US Department of State Dispatch,
Vol 2, No 11, March 18, 1991
Title: Two-Track Approach Toward Peace in the Middle East
Baker
Source: Secretary Baker
Description: News conference en route from Riyadh, Saudi Arabia, to
Cairo, Egypt
Date: Mar 10, 19913/10/91
Category: Speeches, Testimony, Statements
Region: MidEast/North Africa
Country: Israel
Subject: Mideast Peace Process
[TEXT]
Secretary Baker. Let me say that I think we've had a good
series of meetings today, particularly the meeting with the Gulf
Cooperation Council (GCC) foreign ministers, the Foreign Minister of
Egypt, and myself. After that, I had separate bilaterals with the
ministers from Syria and from Egypt, and before the plenary
meeting, I had separate bilaterals with each of the GCC foreign
ministers.
I know you are interested in the peace process, so let me say a
word or two about that, and then I'll try and respond to your
questions. First of all, as you know, we have been trying to work a
two-track approach. I've been exploring with our Arab coalition
partners what steps they might be able to take to signal their
commitment to peace and reconciliation with Israel. Before this
trip began, we had communicated to Israel the general outlines of
our two-track approach, and I am now going to have the opportunity,
when we get to Israel, to talk in detail and specifically with their
leadership about what steps they might be willing to consider. Let
me say, I am not going to go into the specific steps now because we
are still exploring that. We still have a long way to go. It is very,
very early. We are trying to get a process going, and I would simply
say that I have a sense that even though it is early, there is a
greater willingness to be active on this issue in the aftermath of
the Gulf crisis than there was before.
Q. Reading the statement tonight, both the Arab portion of it
and the latter part, there doesn't appear to be anything here on the
track of direct contacts with Israel, state to state. It all refers to
the Palestinian issue, and I ask you--also, I should tell you that in
the public statement of the ministers today, there was no
indication of a willingness to go on that track. We have been told
over and over again, this is a two-track process. Did you hear
anything in private that would dissuade us from the view that the
Arab foreign ministers and Gulf ministers were only talking about
one track?
Secretary Baker. Well, we talked at length about two tracks,
and I made it very clear, at a very early stage in what we hope will
be a process, we have not as yet even arrived in Israel. We have not
had detailed discussions with the Israeli government about what
steps they might be willing to consider and so, therefore, I don't
think it is surprising that you don't have Arab governments coming
out and unilaterally making statements about steps that they would
be willing to take in the absence of knowing a little bit more about
what might develop as the process moves forward.
Q. You still are not really saying though whether the two-
track approach is still alive and the second half of the question is
in your statement: You say that the United States plans to signal
peace and reconciliation to Israel. Is there any signal here beyond
their traditional approach?
Secretary Baker. Well, you read the language. The wording you
just read sounds to me like it's like a signal. In terms of whether
it's still alive, let me simply say that it was only born very, very
recently, so please don't declare it dead until it's actually dead. I
happen to think that it's at least alive until we explore the concept
and the possibilities with the leadership of Israel. Let me say that
I think that the Arab governments with whom we talked generally
about this today exhibited, as I have just indicated to you, a greater
willingness to be active than they had in the past or than they did
before the Gulf crisis was resolved, and I would interpret that to be
a willingness to be active along both tracks, assuming it is a
process that is embraced by others, including, most importantly,
Israel.
Q. Did the Arab states with whom you met today give you
specific concrete things they are willing to do assuming that there
is reciprocity of some sort on the part of the Israelis?
Secretary Baker. We are not at that point. I did not ask them
to commit themselves in the absence of knowing what might or
might not be possible on the other side of the equation. What I
asked them to do was to simply consider the possibility of
participating in this process and developing, in due course, some
specific steps that they would be willing to consider taking if there
was a willingness expressed on the part of the government of
Israel.
Q. Have you gotten any response back from your offer to meet
with Palestinians when you're in Israel? And, there's a second part
to that--as you go into Israel, there are new reports of the Israelis
shooting and wounding Arabs after a disturbance--it seems that
there's quite a lot of violence. What kind of signal does that send to
you as you embark on a peace process?
Secretary Baker. Well, obviously we have expressed our deep
concern about violence in the past. I don't know the circumstances
of the incident that you're talking about, so I don't want to comment
beyond saying what I just said. With respect to the question of
meeting with the Palestinians, it's my understanding that we have
received some indication very recently that there was an interest
on the part of some Palestinians in meeting with us, and, as far as I
know, they're still working that question; I don't have a final
answer for you.
Q. Their statement seems to suggest that they did not support
all of what President Bush had to say the other night although some
participants said they did. Can you tell us whether they supported
everything the President said on the issue of Arab-Israeli peace in
the speech?
Secretary Baker. I don't know--we did not sit down and go
line-by-line through the President's speech, nor for that matter his
interview with--the recent interview he had, I don't remember who
the three journalists were. But in their general comments they
were very supportive of the President's speech and conveyed their
overall general agreement, I think, with the thrust of what he had to
say.
Q. Then I just want to add--can you tell me what it is you see
in this statement that gives you the optimism or the hope that you
expressed earlier about their willingness to be more forthcoming
and change their view?
Secretary Baker. I didn't suggest to you that my optimism--
don't by the way, don't make me overly optimistic, because I don't
mean to be--but whatever sense I have there of a greater
willingness to be active derives not just from that formal
statement that's been put out.
Q. Can you talk in a little more detail about the Gulf security
structure? What kind of role are we going to have, what kind of
role would they like us to have, what are your concerns about Iran,
and how are we going to get 537,000 troops home?
Secretary Baker. On the last question, I'm not going to get into
that because that's basically an operational matter that the Defense
Department could better answer for you, except to say that the
President continues to make it clear that he wants to bring all of
our forces home at the earliest possible opportunity. He continues
to make the point that we do not desire a permanent ground
presence in the Gulf, a fact that has been communicated in the
meetings that I've had with all of these representatives--all of
the governments that I've met with here--and one that I feel
comfortable telling you that they not only accept but agree with.
With respect to the security structure, let me say that we're
talking about various levels. We're talking about an enhanced GCC.
We're talking about an Arab force much as was indicated by the
Damascus communique of these very countries that I've just met
with that would be, in addition to GCC forces, would contain
Egyptian and Syrian elements. We are talking about a role for the
United Nations in terms of observers, particularly with respect to
the Iraq-Kuwait border. We are talking about as well the
possibility that the United States--not the possibility but the
probability--that the United States will continue its naval presence
in the Gulf which it has maintained for over 40 years, perhaps
enhanced. We will be discussing with some countries in the Gulf
the pre-positioning of equipment. We will be discussing as well,
joint participation in training exercises and things like that.
US Department of State Dispatch,
Vol 2, No 11, March 18, 1991
Title: Two-Track Approach Toward Peace in the Middle East
Baker, Levy
Source: Secretary Baker, Israeli Foreign Minister David
Levy
Description: Joint news conference, Jerusalem, Israel
Date: Mar 11, 19913/11/91
Category: Speeches, Testimony, Statements
Region: MidEast/North Africa
Country: Israel
Subject: Mideast Peace Process
[TEXT]
Q. Mr. Secretary, either in your talks tonight or in your
meeting tomorrow with Prime Minister Shamir, have you or will you
ask Israel to commit itself in principle to trading land for peace?
Secretary Baker. I have not asked that during the course of the
discussions tonight with David Levy. I don't think it comes as any
surprise to all to know that the US policy position calls for a
comprehensive settlement based on direct negotiations on the basis
of [UN Resolutions] 242 and 338. And of course, President Bush
made specific reference to this policy position in his address to the
Congress several nights ago. Let me say that I do not come to
Israel, to the region, with any specific, particular blueprint with
regard to peace. But I do come with ideas. I come with a desire and
a willingness to explore ideas that might be generated by others. I
have corresponded with the minister about the importance of our
developing ideas that might lead to peace. I told the minister and
his colleagues this evening that I think that there are great
opportunities in the aftermath of the recently concluded war; that I
think the time is now for us to try and seize the moment to try and
take advantage of these opportunities; that I sensed during my 2
days in Riyadh the beginnings of perhaps a bit of a different
attitude on the part of some countries; that we would like to pursue
the possibilities of peace on a dual track--moving in parallel on the
track of Arab state-Israeli relations and on the path of Israeli-
Palestinian relations, dialogue, and so forth.
Q. Mr. Secretary, when your Administration speaks of political
rights for the Palestinians, do you mean self-determination or do
you consider self-rule, autonomy in the territories, as political
rights?
Secretary Baker. Well, I think that discussions of self-
government fall within the definition of political rights. I think
that the term is one that needs further definition and is subject to
further definition, and perhaps further definition through direct
negotiation between the parties.
Q. Mr. Secretary, you spoke of what you sensed in Riyadh which
sounds not quite concrete. Did you hear real, specific words from
any specific Arab leaders of any specific step they're prepared to
take to accept Israel, or do you just find a sort of an atmosphere
that you find conducive to pursuing this mission? And secondly--
Secretary Baker. Let me answer the first question first,
because I'll forget it by the time you ask your third question, so--
Let me elaborate on that by saying that on this trip, so far, I
have seen what I consider to be at least signs of new thinking. I
have seen what I consider to be a willingness to consider new
approaches. I think that whether that ripens and materializes into
specific, concrete commitments will depend in large part upon
whether or not there is a similar attitude coming from the other
side of the equation. And we hope very much that there will be. I
have heard from others that the United States as a consequence of
this recently concluded war has acquired an even greater credibility
than it had before with Arabs and with Israel; I hope that's true. I
don't assume it. And I hope when I say that, that it is understood
that I do so without arrogance or without any sort of hubris. But I
do want to say that it is the firm hope and desire and wish of my
government, of my president, that we will not let what could be an
historic opportunity pass for want of a willingness to commit
ourselves to do the real, hard work of peace.
Q. Mr. Secretary, I'll change my follow-up then, based on what
you've just said. Then you spoke of looking for an attitude here. Is
it correct then that here, too, you're not soliciting specific moves,
specific actions from this government--you're trying to solicit
some disposition, some attitude, some sense of giving to equate the
sense of giving you found on the other side?
Secretary Baker. That's a pretty good way to express it, I
think. I'm encouraged by what I think was a very positive meeting
that David and I have just concluded, together with our colleagues.
Of course let me say that this war was only recently concluded. We
are dealing here--talking about--an issue that is extraordinarily
intractable, has proven to be so for many, many years. It will take a
great deal of work and a great deal of goodwill, and a great deal of
good faith on the part of all. The United States is committed to
working just as hard as it knows how to contribute to the process.
It is our view that we hopefully can serve as a catalyst, but we
cannot impose peace. We would not try if we thought we could. We
do not intend to engage in what some have referred to as pressure.
We intend to reason, to cajole, to plead, and to offer our good
offices to see if we can seize this opportunity and make progress
for peace.
Q. Mr. Baker, you are interested in the Palestinian-Israeli
dialogue. There are Palestinians who are facing major problems in
the occupied territories, both in the sense that political discourse
is not allowed--it is illegal to have any kind of political meetings-
-and economic problems are very difficult with more than 120,000
people out of work. Will you nudge or cajole or plead with the
Israelis to legitimize political discourse, including legitimizing
support or sympathy with the Palestine Liberation Organization
(PLO)?
Secretary Baker. Including what?
Q. Would you encourage them to legitimize political discourse,
including sympathy or support or membership of the PLO, which is
illegal now? And secondly, would you encourage them to ease the
economic strain on the Palestinians in the occupied territories?
Secretary Baker. Certainly we would like to see the economic
strain and burden eased. Certainly we could like to see--being
people who believe as strongly as we believe in democracy and
knowing that Israel is the only real democracy now in the region--
we would like to see freedom of expression; we would like to see
democratic principles permitted to flourish. We have our problems
with the PLO, as you know. We used to have a dialogue with the PLO.
That dialogue is terminated. We think the PLO made a substantial
error in supporting Saddam Hussein in his brutal invasion and
suppression of an Arab nation.
Foreign Minister Levy. [Foreign Minister Levy's remarks as
translated.] With your permission I would like to add to the
question which was put to you here. Israel aspires to see to it that
the Arab population in Judea, Samaria, and Gaza may have the
benefit of the freedom, of true freedom, which Israel only has in
this part of the world. In other words, we would like to enable this
population to improve its economic situation, just as Israel makes
it possible for the Arab population to do. All of these aspirations
can be realized. This can be done and the affairs of the population
can be managed by the population itself. Israel has proposed this,
and continues to do so, provided of course, the population we are
referring to behaves in keeping with what such an approach would
require. When this population is incited to lash out against Israel,
to wreak destruction, to kill people, to commit murders, as you saw
with your own eyes just yesterday in that heinous and barbarous
act, the slaughter of women, innocent women without protection, in
a manner which is unspeakable, and in fact cannot even be compared
with what an animal would do because no animal would commit such
a murder. When such a population then is incited to such deeds, and
to murder of fellow Arabs as well--in fact 500 men and women
were killed in this manner, barbarously--when anyone thinks that
on the one hand such tactics can be adopted, terrorist tactics
coupled with destruction, while on the other hand benefiting from
full rights--this does not even exist in the world to come. It
simply cannot be. So that Israel cannot but adopt measures
designed to protect its own security and the security of its
population.
Our desire is to see a different era open--an era in which
this population no longer follows the incitement of these terrorists,
of these wreakers of destruction who have led them into an impasse--
who have led the population into a road which spells no hope. If,
indeed, they decide to follow the course of peace, and we do, indeed,
offer the course of peace to them--we strive for peace--and we
have reiterated this point--we have repeatedly reiterated the peace
initiative of the government of Israel in 1989. If they are
responsive to this, they will discover that Israel is at the forefront
of those who have offered this population the possibility of taking
part in determining their own fate. No one proposed this before
Israel did--no one, not the British, certainly not the Jordanians, and
we are in fact interested in resolving the problem. We will not give
in. We will not be brought to our knees by terrorism. We will stand
firm. We will stand up to any attempt to lash out against our
citizens, and against that population itself, while at the same time
holding out our hand to them, offering them freedoms and liberties and
the possibility of managing their own affairs--the affairs of the
population--sitting around the same table and discussing this
peacefully, not in a manner which is marked by murder and destruction.
Therefore, the option is open to this population--the option to
choose to respond to this population--the option to choose to
respond to this initiative at long last. It is time that this came to
pass, just as my friend, the Secretary of State Mr. Baker said, we
find ourselves following two parallel courses--two lines of action-
-both of which offer a definite hope of making progress toward
peace. As far as Israel is concerned, peace is the greatest victory
of all. To date, there was a refusal among the Arab states to talk
face-to-face with Israel about peace. I am pleased that they are
beginning to show signs of change, and we will have to work
together, patiently and courageously, with a sense of faith and hope
in order to move towards the goal which is best for all of us--peace
in this region.
Q. Mr. Foreign Minister, are you speaking of the beginning of a
change on the Arab side? From the standpoint of Israel have you
drawn encouragement from anything Mr. Baker told you about
positions expressed by the Arab states where he visited? Is there
any change which shows a direction toward Israel? A move to
Israel?
Foreign Minister Levy. The discussions which we had this
evening first of all from the standpoint of both nations, were frank
ones, open ones, and constructive ones. We share a common
interest--the United States and Israel. The United States in this
regard does not have any interest which runs counter to the need to
coordinate with Israel and to agree with Israel on the measures
being taken, and we appreciate this deeply.
What we have heard--and we will, of course, keep discussing
this and working on this--certainly shows encouraging signs which
we did not see until now. If we do succeed in continuing to
cooperate in reinforcing this direction, we will together succeed,
with the nations of this region, in coming closer to those goals
which seemed so far away until recently. We will have to continue
working in that direction, but we are closer than we were just
yesterday.
Q. Mr. Secretary, did you hear any new thinking tonight from
Foreign Minister Levy, and do you think that if what Israel offers is
the May 1989 Shamir plan, that that will be sufficient for the Arab
states--that that will be sufficient political cover for them--to
then go ahead with some of the measures you've been talking about
with them?
Secretary Baker. Let me say, I think it's important to
recognize that all parties should avoid retreating into stating final
positions as being non-negotiable demands. We should move--if I
can borrow a phrase--to new thinking and away from old thinking.
As I mentioned, the sense I got on my trip was that there is a
chance for new thinking. I think you just heard the minister say he
was somewhat encouraged by what he heard, and maybe we have a
chance now for some new thinking in both directions. It is not--we
will not make progress on either track frankly, either, if one side or
the other says we do not move until after the other side moves. And
I did not detect that attitude or position here tonight. And so to
answer your question, I remain cautiously optimistic that maybe we
can capitalize on what has been a very significant event in the
region, and in the aftermath of this war, maybe we can begin to
grapple with this issue--these issues--and move toward peace,
which is the best guarantee of security for the region.
Q. Would you just answer my question on the May 1989 plan?
Secretary Baker. The May 1989 plan--I expressed to the
minister our pleasure that the government of Israel--that the
cabinet of the government of Israel--reconfirmed that plan. As you
know, we worked very hard for a period of 14 months to implement
that proposal; came very, very close; we didn't quite make it at the
last minute, but there are many features, and many elements of that
proposal that we view very favorably. We think there are elements
of that proposal with which the parties can work.
Q. Mr. Secretary, I'm wondering if you feel on this trip, that
not enough of the flexibility that you mentioned is expressed. I
wanted to know what is the commitment of this Administration to
keep coming back to the region and keep trying it again and again, or
is this like take or leave it--I mean this is an exploratory visit--
are we in a take it or leave it situation if the parties don't do
enough for throwing up our hands. That's one point, and the second
question is, can you tell us--
Secretary Baker. Let me answer the first one, then you ask the
second one, OK? We are certainly not in a take it or leave it. As I
just said, we do not come with a particular, specific blueprint. We
come with some ideas. We hope we'll hear some ideas. I think
we've heard some ideas in the first couple of days. I believe we've
heard some ideas here this evening. We cannot impose peace. There
will not be peace in the region unless the parties themselves
conclude that they want peace and are willing to do the hard, nitty-
gritty work that's involved in getting there. For our part, the United
States is willing to do the hard, nitty-gritty, repetitive work that
will clearly be involved if we're going to make progress on his very,
very difficult problem.
Q. The support that this Administration has shown until now
for Soviet Jewish immigration is known here, and I was wondering
if you could say definitively that any future assistance, be it in
housing guarantees or other forms of assistance, would be totally
unlinked to progress in the peace process or totally divorced from
any movement that you have been speaking of?
Secretary Baker. We have not linked aid to progress on the
peace process, and I told the minister tonight that there's one thing
of which he and the government of Israel should be very, very sure,
and that is that the commitment of the United States to the
security of Israel is firm. That will not change; that will not
waiver. We are willing to work very, very hard. We think and hope
that we can serve as a catalyst, and particularly in the aftermath of
what has just taken place in connection with this war.
US Department of State Dispatch,
Vol 2, No 11, March 18, 1991
Title: Two-Track Approach Toward Peace in the Middle East
Baker, Shara
Source: Secretary Baker, Syrian Foreign Minister Farouk
Shara
Description: Joint news conference, Damascus, Syria
Date: Mar 14, 19913/14/91
Category: Speeches, Testimony, Statements
Region: MidEast/North Africa
Country: Israel
Subject: Mideast Peace Process
[TEXT]
Secretary Baker. I will start by telling you that in the meeting
last night with President Assad and Minister Shara, we covered a
number of different topics and subjects. Of course, we discussed in
detail the four broad issue areas that I have been discussing during
the course of my trip in the region, and I will continue to discuss as
we move on now to Moscow. Those four issue areas being regional
security in the Gulf; arms control and proliferation; economic
cooperation; and the Arab-Israeli conflict. We also talked about
hostages; we talked about Lebanon and the importance of
implementing in both letter and spirit the Taif agreement. We
talked, as well, about terrorism.
With respect to the question of the Arab-Israeli conflict, I
think that the minister would agree with me that we find ourselves
in agreement with respect to sharing a commitment to seek a
comprehensive settlement based on UN Security Council Resolutions
242 and 338. We find ourselves in agreement with respect to the
fact that there is, we think, a window of opportunity now in the
aftermath of the Gulf crisis that should be seized, if at all
possible--a window of opportunity which could make it possible for
us to make significant progress in resolving the Arab-Israeli
conflict. I sense a very serious intent on the part of the Syrian
government to pursue an active peace process and to continue to
work toward that end with the coalition countries that worked
together to reverse Saddam Hussein's aggression.
Q. Mr. Secretary, after the Gulf crisis has ended, now there is
determination by the international community to implement UN
resolutions regarding the Arab-Israeli conflict, as the Italian
foreign minister said here a few days ago, that there should be no
double standard in dealing with this issue. What are you going to do
as the United States on this respect?
Secretary Baker. I agree that there should be no double
standard, and I would submit to you that, indeed, there is not. The
United States, as evidenced by the activity in which I have been
engaged over the past 4 or 5 days, is going to be very vigorous in
attempting to use whatever influence and good offices it might have
to pursue a comprehensive settlement based on those UN
Resolutions, 242 and 338.
Q. Mr. Secretary, after Saudi Arabia, you said you had heard
"new thinking" from some of the Arab leaders you had met with on
the peace process. After talks here, you said you are leaving with a
sense that the Syrians want to proceed with things. But, do you
have a sense of new thinking here by the Syrian government on how
to break the deadlock in the Arab-Israeli conflict?
Secretary Baker. I have a sense, as I have just mentioned, that
the Syrian government agrees with the US government and other
governments that there is now a window of opportunity--that we
should all be very active in trying to capitalize on that. But, that's
not to say that we don't all realize the difficulties of this problem.
It is very intractable. It has been there a long, long time, and I
sense a desire, frankly, on the part of the Syrian government to
pursue an active peace process and an active role in that process.
That sense is pretty much the same as the sense that I had in the
meeting in Riyadh with the eight Arab countries that formed part of
the coalition that fought the Gulf war.
Q. Minister Shara, is there any change on the hostage
situation? Do you see any progress with the release, the freedom
for the Dawa prisoners? Does that change the situation? Have you
had any recent talks that might indicate that that problem would be
set behind? Minister Shara?
Minister Shara. What was our question, please?
Q. On the hostages, sir, have our--had any recent information
that would suggest that there might be progress toward freedom for
all Western hostages, particularly now that the Dawa prisoners no
longer are being held?
Minister Shara. Well, we have the feeling that the hostage
issue has to be resolved, and we would exert maximum effort to
help in securing the release of all the foreign hostages in Lebanon
and we are not pessimistic that this will happen.
Q. Mr. Secretary, are you satisfied with Syrian progress on the
issue of terrorism, or do you still feel it is necessary for Syria to
do more to be removed from the terrorist list?
Secretary Baker. We still have some differences on this issue,
differences that we discussed last night. We would like to resolve
this problem, and I am confident that the Syrian government would
like to resolve the problem. I do believe that there has, as I said in
Washington, that there has been progress. We hope that there can be
some further progress, and we intend to continue the dialogue which
we have had on this issue to see if we can make further progress.
Minister Shara. Let me try and add to, or just to clarify what
Secretary Baker has said. Well, the difference on terrorism is not
on our joint desire and will to combat terrorism, but the difference
is on the definition of terrorism--what is terrorism and what is not
terrorism.
Q. Mr. Secretary, what if Israel refused to implement Security
Council resolutions concerning the Middle East crisis, and what
would be the US position toward--particularly after Mr. Bush said
that we are going for peace with the same force as we went for the
war.
Secretary Baker. Well, I don't think we ought to assume that
countries, particularly countries that are directly involved will not
be participating actively in the search for peace during this window
of opportunity that has been presented. I am quite confident that
they will be. The sense that I got from my trip to Israel of a day or
so ago was that that government shares a strong desire for peace
and so I can't accept the hypothesis of your question. But let me say
that the President was very clear in the statement that he made to
the US Congress, and I had just said it again here today that the US
policy position is that we support and will actively work for a
comprehensive settlement based on 242 and 338.
Q. Mr. Secretary, can you please tell me why the United States
has not dealt with or talked with the Iraqi opposition which has
just been meeting in Beirut, even though the Turks have and the
British have? Are we, are your people authorized to talk with the
Iraqi opposition that is [inaudible] together?
Secretary Baker. The question of what government Iraq ends
up with in the aftermath of this crisis is a matter for, and we have
said, for the Iraqi people to determine. Now, I don't want to
comment any further beyond saying that.
Q. Mr. Secretary, is Syria still receiving missiles from North
Korea, and, Mr. Secretary, did this come up in your talks?
Secretary Baker. There is, in our opinion, there has been
recently a delivery of Scud missiles to Syria. We discussed at quite
some length the importance of addressing the question of weapons
of mass destruction and the instruments of delivery, therefore. I
thought I'd make that clear.
Q. Minister Shara, would you comment on that question,
please? Why is Syria continuing to seek additional supplies of
those types of weapons against which Syria fought so recently with
Iraq?
Foreign Minister Shara. Well, Syria is still in a state of war
with Israel, and Israel has so many missiles and so many different
types of mass destruction weapons. Yes, a just and comprehensive
peace would solve all these problems. We aspire, of course, to see
our region free of all mass destruction weapons.
Q. Mr. Secretary, don't you find it significant that countries
that subscribe to 242 and 338 on the record in the Security Council
in 1967 and 1973 are talking to you about 242 and 338? What has
progressed here? Israel, Syria, they all agreed on the UN
resolutions. Is there some new interpretation of it? Did you find a
new sense of willingness to go further? What is it that makes it
significant?
Secretary Baker. I think that what makes the situation
perhaps significant today, and as I've made very clear as we left on
this trip, we are dealing with perhaps the most intractable problem
I think that there is, and we ought not to let expectations get out of
control. This is very early in the process of trying to address this
problem in the aftermath of the war, and what is significant is that
there has been a change in the region as a consequence of what has
happened in the Gulf, and I think that all countries involved on all
sides really want to try to seize this opportunity, if possible, to
make progress. It's going to take that kind of an attitude if there is
going to be peace in the region. I want to say one more time that
the United States sees its role as that of a catalyst. We believe
there is some enhanced credibility here as a consequence of what
has happened in the Gulf. We say that with a total absence of
arrogance, as I pointed out in Israel. But, nobody can impose peace
in the Middle East, if the parties to the conflict don't really want
real, true reconciliation. And I think, in the aftermath of this Gulf
war, that there is a better chance than there has been before that
the parties will want real reconciliation.
Q. You say better chance, but are you ready to say--you've met
with the foreign ministers of nine Arab countries only one of which
has accepted Israel. Can you, as you end this trip, say there are
others that now will accept Israel, or do you sense--
Secretary Baker. I don't understand the question--
Q. Well, there's only one Arab country at peace with Israel--
Secretary Baker. There is one Arab country at peace with
Israel, and we need to move the process forward so that there is a
complete peace between Arabs and Israelis, and you've got to take it
a step at a time. You have to crawl before you walk, and you have to
walk before you run, and we've been at it for maybe 5 or 6 days, and
it's a little bit premature to be, it seems to me, suggesting that
somehow there is no opportunity here because we haven't had
instant peace. Let's work at this. This is extraordinarily difficult,
and I think, if I can say this, I think it's reasonably significant that
the Foreign Minister of Israel made the statement that he made in
the aftermath of our visit there, that the Prime Minister said what
he said. I think it's reasonably significant that you find the degree
of agreement that exists here between the United States and Syria
on approaching this issue and between the United States and eight
Arab countries. Now, maybe you don't think that's progress, and
maybe it isn't. Maybe the wheels will come off tomorrow. Let's
give it a chance. We're not going to get there if we're not willing to
work at it--the United States is willing to work at it, and see if we
can serve as a catalyst to peace.
Q. [Inaudible]--that you are going to use your influence and
your good offices with Israel, do you think this will work?
Secretary Baker. Well, I hope so. We certainly believe that
we, as a strong ally of Israel through the years, should have the
ability at least to reason with Israel, help Israel to understand--
which I think they probably already understand--nobody benefits
more from true reconciliation and true peace than does Israel.
Q. Since you saw Prime Minister Shamir, could you tell us
whether or not you saw any evidence of new thinking on the Prime
Minister's part?
Secretary Baker. Well, I think you heard what the Prime
Minister's press spokesman said in the aftermath of our meeting,
and I really do believe that the Prime Minister is willing to, again,
work actively in the aftermath of this crisis to seek peace.
Q. [Inaudible]--that showed that there was perhaps more
convergence than you've seen before?
Secretary Baker. I'm not going to get into the specifics and the
details. It's premature to do that. I think that the government of
Israel is strongly interested in moving rapidly and actively toward
peace. I certainly hope that's the case. I hope that's the case with
the Arab parties to the conflict.
Q. You seem to have better relations with the Arab
governments in the region as a consequence after the war, but what
about the people in the Arab countries, considering that most of the
governments aren't democratically elected--surely the government
might have better relations but the people--[inaudible].
Secretary Baker. That was a question that was asked on
August 3, if you recall: the region was going to go up into flames,
that things were going to totally fall apart on the street. It didn't
happen, did it? It didn't happen to anywhere near the extent or
degree that was predicted. And I certainly don't think that it's
going to happen in the aftermath of a successful stand against
aggression by eight Arab countries and a coalition of other
countries around the world.
Q. Just by definition, do you think that there is a difference
between Iraq's occupation of Kuwait and Israel's occupation of the
Syrian and Palestinian lands [inaudible].
Secretary Baker. Do I see a difference there? I see a
difference there. I see a difference in how it came about, certainly.
Foreign Minister Shara. I will comment on that question. I
don't think that Secretary Baker is talking about the significance
and the importance of using one standard, that is the UN Security
Council resolutions which will resolve the Arab-Israeli conflict. I
think he means the difference in the way that things are taking
place, but the substance we are in full agreement that international
[inaudible] and UN Security Council resolutions have to be abided by
and to be implemented [inaudible]. And the Palestinian question, I
can say that this double standard should not only be used and we are
optimistic [inaudible]--that's why we are optimistic for the future.
That's why we see a window of optimism and hope to give the
momentum to the peace process in our region.
Q. This window of opportunity you're talking about, does that
have a limit; is there a deadline since we have to think ahead
toward the next election cycle?
Secretary Baker. We really don't know the answer to that. We
don't know. We don't know how long the window might be open, and
that's all the more reason why we think we ought to all work as
actively as we can to try and take advantage of whatever time there
is. We don't know.
Q. You don't have a time set?
Secretary Baker. We don't know.
Foreign Minister Shara. Let me just say a couple of words--
that the visit of Secretary Baker to Damascus and the talks that he
held yesterday with President Hafez al-Assad and myself were
positive and constructive, and they will help all of us to work
actively for a just and comprehensive settlement of the Arab-
Israeli conflict and the Palestinian question. We are optimistic
that this opportunity will be utilized in the proper manner, and we
don't like to see the first Gulf crisis era as the same era in the
past. That's why we will keep contacts, and there was agreement
on keeping in touch and keeping these contacts in order to give a
momentum to the peace process for the months to come. (###)
US Department of State Dispatch,
Vol 2, No 11, March 18, 1991
Title: US Policy and Funding Priorities in Latin America and The
Caribbean for FY 1992
Aronson
Source: Bernard W. Aronson, Assistant Secretary for Inter-
American Affairs
Description: Statement before the Subcommittee on Western Hemisphere
Affairs, House Foreign Affairs Committee, Washington, DC
Date: Mar 5, 19913/5/91
Category: Speeches, Testimony, Statements
Region: South America, Central America
Country: Mexico, Guatemala, El Salvador, Nicaragua,
Panama, Brazil, Colombia, Peru, Bolivia, Chile,
Argentina, Uruguay
Subject: Trade/Economics, Narcotics,
Security Assistance and Sales, North America Free Trade
[TEXT]
I am pleased to be here this morning to share with you and the
subcommittee my perspective on the state of our hemisphere and US
policy. I want to discuss the Administration's policy priorities
with regard to Latin America and the Caribbean and to present our
security assistance request for fiscal 1992.
We want to work with the Congress to achieve five basic
objectives in this hemisphere: consolidating democracy and
advancing human rights; encouraging economic reform and
development in which the poor will benefit; promoting regional
peace; ridding the hemisphere of the scourge of drugs; and
cooperating with the nations of this hemisphere on a post-Cold War
agenda of safeguarding our environment and stopping the spread of
missile and nuclear weapons technology around the world.
The opportunity to achieve these objectives is great. In the
last decade, voters led a political revolution throughout the
Americas, burying a tradition of dictatorship through the peaceful
act of going to the polls. In this decade, the leaders they elected
are driving an economic revolution of equally far-reaching
consequence.
Revolution is a strong word, but it is no exaggeration. When
Argentina sells its state airline and telephone company to private
companies, that's revolutionary. When Mexico cuts its tariffs from
over 100% to an average of 10%, that's revolutionary. And when
Jamaica opens its largest export industry--tourism--to private
investment, that's revolutionary. These are but three examples of a
sharp turn to a new economic philosophy that sees opportunity, not
danger, in economic freedom and full participation in the
competitive international marketplace.
This revolution is widespread, but it hasn't yet succeeded. In
many cases, it involves a political struggle against the entrenched
elites that benefit from the privileges of the old, protected
economic system. Let there be no doubt that we have a profound
interest in its success.
A democratic hemisphere with modern, open economies will be
a stable hemisphere. It will be a hemisphere that fulfills the
promise of human rights, not just as people vote in elections but as
they make free choices in the marketplace. It will be a hemisphere
of social justice, where greater economic freedom leads to a broad-
based prosperity.
And it will be a hemisphere that offers increased opportunity
for American workers and businesses. Right now, about 13% of our
exports--$47 billion in 1989--go to Latin America and the
Caribbean. If you doubt that successful economic reform in Latin
America can make a difference to the US economy, just look at
Mexico, a country leading the way in economic reform, where our
exports have doubled between 1986 and 1989.
To help this economic revolution succeed, and to achieve our
broader objectives in this hemisphere, we need the help of Congress.
Reauthorization of fast-track negotiating authority for free
trade agreements is essential, not just for the North American Free
Trade Agreement with Mexico and Canada, but also for the
President's vision of an entire hemisphere free of trade barriers.
The Enterprise for the Americas Initiative offers more than
the vision of free trade--it encourages the free flow of
international investment and offers new opportunities for debt
reduction and environmental protection. To make these investments
and debt initiatives possible, we urge Congress to pass the
Enterprise for the Americas Initiative act.
As we ask the Andean nations to stop the supply of cocaine, we
need to respond to their need for greater export opportunities. The
Andean trade preferences act is a key component of the war on
drugs, and I urge you to support its passage.
Our foreign assistance request is the absolute minimum we
need to help our democratic partners to reach the political and
security goals we have in common, and we need your help in
securing its approval in Congress.
I want to underscore one central point: we stand to benefit
from a period of nearly unprecedented opportunity in this
hemisphere. Democracy is strong. Economic policy is on the right
track. Nations want to cooperate with us in the war on drugs. We
have ended the rancorous debate over Central America that
distanced us from our neighbors and divided us at home.
This hemisphere is turning to the democratic processes and
free market policies the United States has long espoused. The
question before us is whether we can take yes for an answer. We
owe it to our neighbors and to ourselves to respond with energy and
creativity to the extraordinary opportunities before us.
The Persian Gulf
Let me turn briefly to the Persian Gulf and this hemisphere's
reaction to the crisis. We are heartened by the nearly uniform
solidarity of the hemisphere to the crisis. Argentina provided two
ships for the allied effort, and Honduras offered troops. Venezuela,
Mexico, and Colombia all boosted oil production and exports to make
up for the Persian Gulf production shortfall. Every country in the
hemisphere except Cuba has supported the sanctions against Iraq--
even though for some it means real economic sacrifice. And even
Cuba condemned Iraq's invasion of Kuwait. We have also enjoyed
full cooperation in protecting against terrorist threats related to
the Gulf situation.
The Caribbean
On February 7, I attended the inauguration of the first
democratically elected Haitian president in recent memory. The
atmosphere in Port au Prince was full of optimism, as Haiti joined
the hemisphere's democratic mainstream. Under the auspices of the
OAS [Organization of American States] and the UN, and with US
financial support, some 200 election observers from 22 countries
witnessed the Haitian election and helped guarantee its fairness.
I am proud that insistent US support for democratization in
Haiti, and financial support for the elections, contributed to this
happy result. In the past year this support included an invitation to
interim President [Ertha Pacal] Trouillot to meet with President
Bush in Washington and a visit to Haiti by Vice President Quayle. I
made three trips to Haiti myself. We are now committed to
assisting President [Jean-Baptiste] Aristide in consolidating
democracy and improving the lot of the Haitian people.
The task is daunting. The poorest country in the hemisphere,
Haiti's needs for both human and infrastructure development are
enormous. Its infant mortality rate of 12% is twice the region's
average, while the percentage of secondary school age population
actually enrolled--17%--is one-third the hemisphere's average.
Sound growth-inducing policies and well-targeted social
investments can, however, move Haiti rapidly forward. At
President Aristide's request, we also are re-examining the
sensitive issue of Haitian migration to the United States.
The island nations of the Caribbean are among our closest
neighbors and best friends. Most of them are poor, with a narrow
economic base. This leaves them vulnerable to sudden changes in
the world economy and, most dangerously, to exploitation by drug
traffickers. Through the Caribbean Basin Initiative and the
Enterprise for the Americas Initiative, we want to help these
nations diversify their economies through expanded trade and
investment.
In most of the Caribbean, democracy and respect for human
rights have quietly flourished for a quarter century. The exceptions
to this trend remain Suriname and, of course, Cuba. We deplore the
December military coup in Suriname that overthrew a
democratically elected government. We urge the interim
government in Paramaribo to keep its pledge to hold free and fair
elections on May 25, to make them open to full international
observation, and to respect the results. OAS Secretary General
[Joao] Baena Soares also has insisted that the present government
guarantee the observers' autonomy in carrying out their mission.
We are also concerned about indications that Suriname is serving as
a transit point for cocaine shipments to Europe and, more recently,
the US. This hemisphere will not tolerate another drug dictatorship.
In Cuba, where a Marxist dictator makes all the decisions,
there is little consideration of democratic reform, and human rights
are systematically denied. Defenders of human rights are routinely
intimidated or arrested for exercising their basic right of free
speech. One example is Samuel Martinez Lara, the leader of the
Cuban Human Rights Party. He was jailed for nearly a year without
charges, then last month was accused of "non-violent rebellion" and
sentenced to 3 years' probation. Even after the wave of democracy
that swept Eastern Europe, the Cuban government has rejected
international calls for a plebiscite.
As Cuba's former allies in Eastern Europe have turned to
democracy and economic freedom, they have limited their economic
relationship with Cuba. Aid from Eastern Europe is almost non-
existent; trade once amounting to 15% of Cuba's total trade is less
than half its previous level. Soviet oil deliveries fell by 20% from
1989 to 1990 and will remain at 1990 levels this year; aid and
technical assistance will be reduced. In an interview on February
14, Fidel Castro described the impact on Cuba's economy of changes
in Eastern Europe and the Soviet Union as catastrophic. The Soviets
have urged Cuba to adopt economic reform in order to compensate
for reduced trade and aid; to date, this advice has fallen on deaf
ears. Castro's response has been extensive rationing, sending
people from the cities to do farm labor, replacing farm machinery
with animals, and importing hundreds of thousands of bicycles. The
Cuban government's behavior has isolated Cuba--from Cuba's former
allies, from the rest of the hemisphere, and from the United States.
We would like to see a change in our relationship with Cuba,
and I believe that change must come. Our relations with the Soviet
Union improved because the Soviet Union committed itself to new
thinking in foreign policy and undertook economic and political
reform. The critical question is, when will the Cuban government
see that reform--both political and economic--is inevitable? Our
hope, like that of many Cubans, is that democratic change will come
soon and peacefully.
Mexico
Nowhere in the hemisphere are the prospects for a closer,
more cooperative bilateral relationship brighter than in Mexico.
President Carlos Salinas has embarked on a bold course of economic
reform. We should assist and encourage his efforts. The Salinas
administration has reduced tariffs, privatized state-owned
companies, and announced its readiness to negotiate a free trade
agreement with the United States and Canada.
A North American Free Trade Agreement is an important goal
of this Administration. It will and already has given momentum to
the entire hemisphere's drive to lower trade barriers. Already,
Argentina, Brazil, Uruguay, and Paraguay are negotiating a common
market for the southern cone. Already, the Andean nations have
established an ambitious plan for regional economic liberalization.
If Congress fails to approve fast track negotiating authority, it will
send a crushing, negative signal to the entire hemisphere at a time
when our neighbors, after a decade of stagnant growth rates, are
moving aggressively to remove barriers to global trade and
investment.
A North American Free Trade Agreement will spur growth in
both the US and Mexico, and it will help make both economies more
competitive vis-a-vis the rest of the world. Free trade with Mexico
also means jobs--not jobs lost but jobs gained. According to US
Department of Commerce estimates, every $1 billion we add to US
exports creates 25,000 new jobs for American workers. In 1990,
we exported nearly $30 billion in goods to Mexico, double our
exports of only 4 years ago. According to that estimate, those
increased exports would translate into 375,000 new jobs.
But our interests with Mexico go far beyond trade. I can tell
you today that our relations with Mexico are stronger across the
board than they have been in many years. To cite just one key
example, our cooperation in the war against drugs has never been
better. We have established the Northern Border Response Force, we
are cooperating on patrol flights by US P-3 aircraft, and we have
provided helicopters to Mexico to bolster interdiction efforts. We
have seen significant progress in marijuana and opium poppy
eradication. Most of Mexico's naval operations and 25% of its army
personnel are devoted to counter-narcotics activity.
Central America
Central America has made great progress in the last decade
and has great opportunity ahead. Elected governments that took the
reins of power from military juntas at the beginning of the last
decade have been replaced, peacefully and quietly, by new
democratic successors. Elections and dialogue have shown the way
to ending military conflict. Full regional peace, once achieved, will
allow Central Americans to devote their energies once again to the
20-year-old dream of economic integration. This time, the effort
will be led by governments that see strength, not danger, in full
participation in the competitive world economy.
The Central American republics have a common historical
identity dating from their independence in 1821. They think in
regional terms, and in our day we see that they prefer to address
problems through common regional approaches. From Washington,
we all see that the crisis atmosphere of the 1980s is past, but we
cannot allow this to draw our attention away from this region.
Instead, our foreign policy must seize today's opportunities and
build on the progress already made.
We will keep our focus on Central America, and we want to
keep our friends around the world involved as partners in the
region's development. During the past year, the Administration has
been working to foster an international partnership--the
Partnership for Democracy and Development (PDD) in Central
America. The objective of the PDD is to pool the energies of the
governments of the 24 OECD [Organization of Economic Cooperation
and Development] nations, the six Central American countries,
Colombia, Mexico, Venezuela, and representatives of key
international institutions in a common effort to support democracy,
peace, and economic development in Central America. This concept
is receiving strong support from key European and Far Eastern
nations as well as from our Central American neighbors themselves.
I will be going to San Jose, Costa Rica, on April 10, along with
representatives of the countries I just mentioned, to participate in
the partnership's organizational meeting.
Guatemala.
The recent elections in Guatemala and the inauguration of President
Jorge Serrano are clear signs of progress and hope. This marks the
first time in Guatemala in 40 years that the candidate of an
opposition party has been elected in a free, honest vote and allowed
to assume office peacefully.
During the [Vinicio] Cerezo administration, Guatemala's failure
to effectively pursue the investigation of the murder of an
American citizen, Michael Devine, made it necessary to suspend
security assistance in December 1990. Earlier, other failures to
prosecute human rights cases led us to recall our ambassador in
March 1990. In contrast, the first signals from President [Jorge]
Serrano--starting in his inaugural address, when he warned the
security forces that their human rights violations would no longer
be met with impunity--tell us that Guatemala has a president who
is firmly committed to establishing civilian authority over security
forces and instituting broad respect for human rights and the rule
of law. President Serrano's economic policies show similar
promise, and we are engaged in an active dialogue with him and his
government to help him meet these important goals.
El Salvador
Voters in El Salvador will go to the polls on March 10 to elect all 84
members of the Legislative Assembly, plus mayors and municipal
council members in all 262 municipalities. Twenty-four seats were
added to the Legislative Assembly as the result of an agreement
among the full range of Salvadoran political parties. Twenty of
these seats will be filled by at-large candidates running on national
lists--this should help smaller opposition parties to win seats.
This will be the seventh election since an era of democratic
reform began in El Salvador in 1979. The people of El Salvador
alone deserve the credit for this achievement, and for the broad
political space beginning to be enjoyed by people of all points of
view. But we should be proud of our role--consistent US support for
the democratically elected governments of the late President Jose
Napoleon Duarte and President Alfredo Cristiani has been an
important factor in the expansion of democracy in El Salvador.
Like previous elections in El Salvador, this election will take
place under the microscope of international observation. The OAS,
to its great credit, is leading the observation effort with over 120
observers deployed in El Salvador's 14 departments, including those
where military conflict has been most intense.
I would note as well that last year El Salvador's economy--
despite the systematic destruction and violence wreaked upon it by
the FMLN [Farabundo Marti National Liberation Front]--enjoyed
positive real growth and one of the lowest inflation rates in the
hemisphere. That is a tribute to the reform policies of the Cristiani
government, but bipartisan US support for economic reform--
steady, patient, continuing--also contributed significantly to this
achievement.
Over a year ago, the world was shocked by the brutal murder of
six Jesuits, their housekeeper and her daughter in San Salvador.
Even though nine Salvadoran officers and enlisted personnel were
arraigned in this case--and four others have been charged with
obstructing justice--the armed forces have not fully cooperated in
the investigation. The government of El Salvador knows that the
disposition of this case will deeply influence our future
relationship.
Nicaragua.
At the same time, under the auspices of the United Nations,
negotiations between the government of El Salvador and the FMLN
aimed at bringing an end to El Salvador's decade-long civil conflict
continue. The US fully supports these negotiations and hopes that
the international community will energetically support a prompt,
negotiated solution to El Salvador's civil war. There are many
obstacles in the path of a lasting peace and sustained democratic
rule in El Salvador, but I am still optimistic that this is the year
for peace in El Salvador.
In Nicaragua, the democratically elected government of Violeta
Chamorro will soon celebrate its first anniversary. Nicaraguans
still bear the heavy burden of a decade of Sandinista misrule--high
inflation, unemployment, a bloated and costly collection of
bureaucracies and state enterprises, and deep social division. But
President Chamorro has brought a new spirit of optimism with her
tireless effort to heal old wounds and the promise of thorough
economic reform. She already has several achievements to her
credit--the war is ended, the resistance peacefully demobilized,
the state's foreign trade monopoly is abolished, wasteful subsidies
have been eliminated, confiscated properties are being returned, and
the army has been reduced by over 50%, to name just a few.
National reconciliation is moving forward despite the tragic
assassination of Enrique Bermudez and the killing of some 40
former Resistance fighters over the past year. We join with
President Chamorro in condemning such violence and urging those
responsible to end the last vestiges of political polarization and
join in the effort to move the country toward greater individual
freedom and economic well-being.
Our aid programs are playing a significant role. Working with
$30 million in funds we provided, the International Commission of
Verification and Assistance--directed by the OAS and the UN--has
helped some 90,000 former combatants and family members of the
Nicaraguan Resistance to return to civilian life.
Since Mrs. Chamorro's election, we have pledged $537.1 million
in economic assistance to Nicaragua. Of that total, $35.1 million
was in immediate emergency assistance. A $300 million assistance
package was approved for fiscal 1990, and an additional $202
million for fiscal 1991. Since April 1990, the United States has
signed agreements obligating $289.4 million of the 1990 aid
package, of which $155.1 million has been disbursed. Of the 1990
funds, $128 million have been set aside to provide balance-of-
payments assistance in support of Nicaragua's economic
stabilization and structural reform. An additional $50 million has
been set aside for the international effort to clear Nicaragua's IDB
[Inter-American Development Bank] and World Bank debt arrearages;
$47 million has been allocated for the repatriation of the ex-
Resistance and refugees; and $75 million is being used for long-
term development projects, to generate immediate jobs, to provide
new textbooks for the public school system, and for emergency
medical supplies.
Panama
Panama is another Central American democracy emerging from a
debilitating period of dictatorship. We are working closely with
President Endara and his government to strengthen democracy and
spur economic recovery.
Under President [Guillermo] Endara's administration and with
US assistance, Panama's economy grew last year at an annual rate
of nearly 4%, among the highest in the region. To assist the
recovery, we are providing Panama with some $452 million in
economic aid and $500 million in loans and guarantees for fiscal
1990 and 1991, the largest aid package in the hemisphere and the
third largest in the world. The United States also made
immediately available to the new democratic government some
$430 million in Canal fees which was held in escrow for the
government of Panama during the last 2 years of the [Manuel]
Noriega regime.
Part of our aid is repairing war damage, providing new housing
for the residents of the Chorillo neighborhood in Panama City, which
was destroyed by the fleeing Noriega forces during Operation Just
Cause. Other aid has been used for the health care system, public
works, and to provide new credit for the private sector.
Panama is committed to transform the former corrupt,
Noriega-dominated Panama Defense Forces into a civilian-led
national police. Most officers above the rank of captain have been
replaced. Thirteen million two hundred thousand dollars of our aid
is devoted to an extensive police training program administered by
the Justice Department's International Criminal Investigative and
Training Assistance Program. The first class of police trainees at
the newly established US-supported police academy graduated last
February 22.
At the end of this decade, Panama will assume full control of
the canal and its operations, as provided in the 1979 treaties. Last
September, in accord with the treaties, the first Panamanian
citizen, Gilberto Guardia, was installed as Administrator of the
Panama Canal Commission. Panamanian participation in the canal
workforce has grown to 86%.
It is fashionable to denigrate the achievements of Panama's
new democratic government--measuring it against a standard of
perfection instead of how far it has come from where it began. But
a little over 1 year since American forces bravely liberated Panama
in Operation Just Cause, Panama is free; honest and open elections
for National Assembly seats have been held; the economy is
growing, and unemployment has been reduced by 10 full percentage
points; civilians--not the military--make political decisions; the
country successfully restructured its official bilateral debt at the
Paris Club and is moving to regularize its financial relations with
the World Bank, IMF [International Monetary Fund], and Inter-
American Development Bank; tough statutes have been enacted on
money laundering; the Panama Canal treaties are being
implemented; and Panama has been welcomed into the Central
American regional economic and political summit talks. The United
States can be proud of the role it has played in the liberation of
Panama.
South America
The democratic governments of South America today are eager
to define their new role in a post-Cold War world and their
relationship to the United States, and need our continued support.
The large countries of South America--notably Brazil and
Argentina--are increasingly important global actors. Democratic
Chile will also assert itself on the international stage in the period
ahead. We hope to strengthen our cooperation with these countries
in key areas such as curbing nuclear proliferation and supporting
regional stability elsewhere in the world.
Argentina, Brazil, and Peru are still grappling with serious
inflationary pressures and a daunting array of related economic
problems. These problems derive from the ingrained statist and
protectionist economic model which resulted in the region's poor
growth record during the 1980s. Most countries in the region have
begun to pursue market-oriented and private-sector driven policies.
Some, such as Chile, Bolivia, Colombia and Mexico, have made
significant progress and achieved deep structural changes.
Although reform often carries short-term social costs, these costs
pale in comparison to the prospect of repeating another "lost
decade" under the old economic policies. The new thinking is taking
hold, and in key countries investor confidence is beginning to return.
Brazil
Brazil, President Fernando Collor [de Mello], the first directly
elected president in 29 years, has embarked on a bold economic
reform program designed to break Brazil's inflationary spiral and
liberalize economic and trade policy. Much remains to be done,
including reduction of the government's deficit and privatizing
state industries, in order to reduce Brazil's high inflation.
We are working closely with the Collor government to improve
our cooperation in scientific research. We are also working to
address the problem of controlling the spread of technologies with
potential military applications.
The survival and preservation of Brazil's Amazon region is an
important environmental concern. In April 1989, the government of
Brazil introduced a program called "Our Nature" to preserve the
Amazon; it included suspension of certain tax incentives that
encouraged deforestation. When President Collor took office, he
eliminated those tax incentives permanently. His government is
moving aggressively to create guidelines and zoning regulations for
land use, with an emphasis on the Amazon. As a further sign of
President Collor's commitment to work with the international
community to address environmental concerns, Brazil will host the
1992 UN Conference on Environment and Development. The Agency
for International Development has also recently initiated a new
cooperative program with Brazil to address problems related to the
issue of global climate change.
Narcotics Control. In the struggle against narcotics, the
United States continues to assist the signatories of the Declaration
of Cartagena in their efforts to reduce production, improve
interdiction, control precursor chemicals, and stop money
laundering. Just 2 months after Cartagena, Attorney General
[Richard] Thornburgh joined some 20 other ministers of justice in
an OAS-sponsored meeting in Ixtapa, Mexico to give region-wide
application to the Cartagena principles. With full support from the
Administration, the OAS has developed the world's toughest model
standards on the export and import of precursor chemicals. Our
Justice Department is helping OAS experts to draft comprehensive
model codes to curb money laundering in the hemisphere.
Colombia
In Colombia, President [Cesar] Gaviria, like his predecessor, has
shown great political courage in dealing with the problems of
violent drug traffickers and insurgency. In 1990, Colombia seized
over 50 tons of cocaine, destroyed over 200 cocaine labs, and
arrested over 7,000 suspects on trafficking charges. In the first 2
months of this year, about 12 metric tons of cocaine were seized.
Last month, President Gaviria came to Washington for a working
visit with President Bush and signed an agreement that will help
our two governments share evidence in narcotics investigations. No
nation has shown more courage or commitment in the war against
narco-trafficking or paid a greater price than Colombia.
We are also encouraged by recent successes in negotiating a
peaceful end to Colombia's guerrilla insurgencies. We support the
initiative of President Gaviria to offer dialogue to the EPL [People's
Liberation Army] and FARC [Revolutionary Armed Forces of
Colombia] guerrillas and hope they respond affirmatively.
Peru. President [Alberto] Fujimori of Peru faces the triple
scourges of an entrenched, brutal guerrilla war, powerful cocaine
trafficking organizations, and now pandemic cholera. In the past,
anti-narcotics programs in Peru have suffered from a lack of firm
policy guidance, but President Fujimori is working on
comprehensive approaches to stop drug trafficking and provide
economic alternatives for peasants now dependent on the cocaine
economy. We are funding a $27.9-million Upper Huallaga Valley
special project to provide agricultural services and community
development support to ex-coca farmers who switch to alternate
crops.
The Fujimori government has courageously sought to address
the economic and debt crises it inherited. It needs and deserves the
international community's continued support as it moves forward on
the path of economic reform.
Bolivia.
Bolivia, the region's second largest producer of coca leaves, is
making steady, progress toward its commitment to reduce and eventually
eliminate illicit coca production. Nevertheless, the threats of
corruption and growing terrorism remain of serious concern.
In 1990, the US provided $45.5 million to Bolivia for basic
economic reform and for alternative development projects. For the
past 3 years, an AID-funded project has provided irrigation to the
arid and poor Cochabamba high valleys to eliminate the population's
need to earn extra income through seasonal work in the Chapare
coca region. Before the program started, surveys showed that up to
75% of the available men migrated from the high valleys to the
Chapare for temporary work. This year, almost none have left.
Other projects we fund have employed over 100,000 laborers in road
building and other community development work.
Five years ago, Bolivia faced a 25,000% inflation rate; today,
its inflation is lower than ours--a testament to Bolivia's steadfast
commitment to sound economic policy.
Chile
In the Southern Cone, our relations with the new democratic
government of Chile continue to expand and strengthen. In his
December visit to Chile, President Bush addressed a joint session of
the Chilean Congress and supported Chile's democratic transition
and pace-setting free-market policies. In many ways, Chile is
emerging as a model for Latin America--a model of democratic
consolidation and national reconciliation and a model of economic
reform that produces real gains, as Chile's steady record of growth
and new investment demonstrates.
Chile has expressed interest in a free trade agreement similar
to the one being negotiated with Mexico. We have restored GSP
[generalized system of preferences] benefits to Chile, lifted
sanctions imposed on the previous regime, and made progress in
bilateral trade and investment issues. We are concerned, however,
about the escalation of terrorism against US interests in Chile.
Argentina.
Perhaps nowhere in the region has the shift in foreign policy
emphasis been clearer than in Argentina under President Carlos
Menem. Argentina has renewed diplomatic relations with the United
Kingdom and contributed naval vessels to the Gulf coalition. Just
before President Bush's South America trip on November 28, 1990,
Presidents Menem and Collor announced that they will place all
their nuclear facilities under International Atomic Energy
Administration safeguards and work to bring the Treaty of
Tlatelolco, the Latin American non-proliferation treaty, into force.
This agreement is a major step forward, and it could be a model for
similar agreements elsewhere in the world. On the economic front,
privatizations of the national telephone company (Entel) and airline
(Aerolineas Argentinas) are beginning to reverse state domination
of the economy. Politically, it is clear after the failed military
revolt last December that the Argentine people have no desire to
return to authoritarian rule.
Uruguay.
President Bush also visited Uruguay on his five-nation tour of South
America, underscoring our support for democracy and for President
[Luis Alberto] Lacalle's efforts to create a more open, market-
oriented economy and spelling out the benefits to be derived from
the Enterprise for the Americas Initiative. Uruguay, as a middle-
income developing country, is not eligible for some kinds of US
assistance, but we have provided some security assistance to
enhance Uruguay's ability to interdict drugs. We also made a
surplus food grant last year, the sale of which provided about $2.8
million for Uruguay's Social Investment Fund. To their credit, both
Uruguay and Brazil adhered with great integrity to UN economic
sanctions against Iraq, despite the serious cost.
Paraguay.
In Paraguay, President Rodriguez is steadily, courageously leading
his nation--so long locked into dictatorship--into the mainstream
of the hemisphere's democracies. The US has reinstated GSP
benefits, contingent on the reform of labor practices, including the
right to organize. We also are providing, through the National
Endowment for Democracy, money to train observers for the May
1991 municipal elections, the first such vote in Paraguay's history.
Finally, Paraguay has joined its Southern Cone neighbors in
negotiations for a common market and in negotiating a joint
framework agreement with the United States under the Enterprise
for the Americas Initiative.
The Enterprise for the Americas Initiative
When I began my statement, I discussed a revolution in
economic thought and policy in this hemisphere--a sharp turn away
from statist, protectionist policy and toward economic freedoms.
For the poor of this hemisphere, for those who want to see
democracy succeed, for those who look to participate in the
economy of the Americas, this change in thinking represents a
profound opportunity, and its impact can be far greater than any
amount of aid we would extend.
President Bush got a strong sense of this new thinking in
February 1990 when he went to the Andean drug summit in
Cartagena, Colombia. The presidents he met gave him an emphatic
message--more than aid, they want their citizens to have the
opportunity to sell their goods in the world economy, including the
US market. On the flight home from Cartagena, President Bush told
his advisers that we owe our neighbors a bold response.
Within 4 months, on June 27, 1990, the Enterprise for the
Americas Initiative (EAI) was born. In its spirit, it is an offer of
partnership among countries eager to forge ahead with economic
reform. It is based not on dependency and aid, but on concerted
action to free our economies from restrictions that have helped
economic elites and stifled the poor and the industrious. It offers a
vision of free trade throughout the Americas.
The programs of EAI promote prosperity through trade and
investment liberalization and debt relief, with a new emphasis on
environmental protection. EAI offers the most to those that are
doing the most to reform. We are encouraging other nations,
especially Japan, to pursue similar objectives for the region. We
hope that Japan and the European Community will contribute to a
proposed EAI Multilateral Investment Fund to be administered by the
Inter-American Development Bank. The fund would provide $300
million in grants annually over the next 5 years to support
comprehensive reforms in investment policy, privatization, and
human capital needs.
Since the EAI was launched, we have negotiated framework
agreements with five countries, and discussions are underway with
nine others. These agreements establish principles for cooperation
on trade and investment, and can set the framework for negotiating
free trade agreements. We trust that the Congress will provide the
President the authority necessary to move ahead in expanding free
trade in this hemisphere.
We are also working with the Inter-American Development
Bank on a new program that will provide lending to support
countries that removing impediments to international investment.
I also urge the Congress to take rapid action on the remaining
portions of the debt element of the EAI. We are moving forward
quickly with debt reduction agreements on PL 480 programs under
the authority granted by the 1990 farm legislation. We still need
authority for debt reduction agreements on concessional debt
administered by AID, and for debt-for-equity and debt-for-nature
swaps relating to Commodity Credit Corporation and Export-Import
Bank programs.
The Latin American region today is in a position to launch
self-sustaining growth within a democratic and stable political
framework. There is nothing automatic nor guaranteed about
continued progress, but it is certain that the programs of the EAI
provide powerful leverage to continue economic reforms.
Overview of Budget Request
The Administration's request for assistance for Latin
America and the Caribbean for fiscal 1992 balances the vital
interests of the United States, the need to meet the challenges that
the region poses, and the reality of ever-increasing fiscal
constraints.
For fiscal 1992 we are requesting $1.52 billion for economic
and anti-narcotics assistance and $280.2 million for security aid.
This represents an increase of $104 million, or 6% over levels
requested for fiscal 1991. The total requested, $1.799 billion,
accounts for less than 17% of our worldwide assistance request, a
modest sum considering the importance of the region to the United
States.
Security Assistance
At this point, I would like to address the security assistance
component of our request. In fiscal 1992, we have requested $713.9
million in economic support funds (ESF) and $280.2 million for
military assistance (FMF and IMET), totaling $994.1 million, or
12.1% of the requested worldwide security assistance. In addition,
AID has targeted $406 million in development assistance with
special emphasis on job creation to benefit the poor, primary health
care, education, strengthening of democratic institutions, and
preserving the environment.
Of the sum requested for military assistance, $13.75 million
will go to the International Military Education and Training (IMET)
program. In past years, this popular program has provided
professional and technical training to Latin American military
officers and non-commissioned officers. Through well-structured
courses, this program gives the future military leaders of our
region important training in human rights and civil-military
relations. In the hope that we can build on the successes of the
past, we are requesting IMET programs in virtually all countries in
Latin America and the Caribbean with which we maintain diplomatic
relations.
This year, thanks to the initiative of friends in the Congress,
we have a revision in the fiscal 1991 IMET legislation which
enables us to include civilian officials in our IMET training
programs. Effective civilian control of the military will become
reality only when there are enough well-trained civilians who can
play leading roles in defense programs and budgets, strategic
planning, force structure management, and of course the
management of the US military assistance programs. We are
working to make IMET-funded courses for civilians begin within the
next few weeks.
Of the $266.4 million in Foreign Military Financing (FMF) that
we have requested, $137 million will support the Andean counter-
narcotics strategy in Bolivia, Colombia, and Peru. It also includes
$5 million for Ecuador. A total of $108.9 million in FMF will
support the key democratic countries in Central America. This
leaves only a request for $15.5 million in FMF outside the Andes and
Central America. Of that amount, $11.9 million is for the drug-
threatened Caribbean. The remaining $3.5 million will go toward
reinforcing civil-military relations in Argentina, Chile, Paraguay,
and Uruguay.
We have taken steps to ensure that our security assistance,
including that provided to fight narcotics trafficking, supports our
key policy objectives in the region. Together with the Defense
Department, the Drug Enforcement Administration, and other
agencies, we have developed a human rights training program which
will be administered to our officials, both military and civilian,
before they assume duties related to the implementation of our
counter-narcotics and military assistance programs in our
embassies. The training will provide our personnel with a thorough
understanding of human rights law and policy, as well as
information about the human rights situation in the country to
which they will be assigned.
Our security assistance has helped us make progress in the
drug war in the first year of the Andean strategy. We have helped
Colombia to maintain its vigorous campaign against narcotics
traffickers, yielding a 37% increase in seizures over the previous
year. Accomplishments include the seizure of over 50 metric tons
of cocaine, the destruction of over 300 processing labs, and 7,000
arrests. Colombian police also have eradicated virtually all
marijuana cultivation in traditional growing areas. The government
has dealt severe blows to the leadership structure of the Medellin
cartel by keeping drug kingpins, such as Pablo Escobar, constantly
on the run. Colombia extradited 14 drug suspects to the United
States in 1990; the total extradited since August 1989 is 26. Three
other major traffickers have surrendered under President Gaviria's
amnesty decrees which guarantee confessing traffickers a
shortened sentence and no extradition. However, Colombian
security forces continue to pay a heavy price. In the last year, over
400 national policemen have died at the hands of the traffickers.
Our narcotics-related security assistance has yielded good
results in Bolivia as well. Coca eradication during the year reached
a record level of over 8,000 hectares, making possible a net
reduction in the amount of coca cultivation for the first time. Joint
police, air force, and navy task forces have expanded counter-
narcotics operations, disrupting trafficking patterns. A major
narco-trafficker was arrested, along with his lieutenants, planes,
laboratories, and other personal assets, in a combined operation.
In Peru, President Fujimori has expressed his government's
commitment to fight narcotics trafficking. Though concrete actions
have, until recently, been limited, we are beginning to see
promising signs. There are increasing reports of effective Peruvian
military and police coordination against traffickers in the Upper
Huallaga Valley. In addition, the Peruvian air force has forced down
two planes in the Upper Huallaga Valley, both laden with narcotics.
President Fujimori has proposed an innovative, comprehensive
agreement, integrating alternative development and law
enforcement, which should provide a solid framework for our future
counter-narcotics cooperation. Negotiations should conclude
shortly. We, thus, are hopeful that our two governments will soon
be jointly working effectively against narcotics production and
trafficking.
Our focus is fighting narcotics, not insurgency,
notwithstanding the evidence of collusion between narco-
traffickers and guerrilla groups in Colombia and Peru. Our
assistance is in all instances channeled through the civilian
governments. While our preference is to work with established
police forces, we have seen that these units are often not trained or
equipped to engage the paramilitary forces of narcotics traffickers
in remote and dangerous areas. Thus, we believe that specially
trained military units can bring a significant resource in the war on
drugs, if properly coordinated and directed by civilian authorities. I
want to stress that our military trainers will be limited in number
and will not become directly involved in counter-narcotics
operations. As their title conveys, they will only train.
Conclusion
I have submitted this detailed statement to give you a full
picture of the challenges and opportunities we face in this
hemisphere. I am optimistic about the future of the Americas, and I
believe our policies respond to our interests and to our neighbors'
concerns. Moreover, I am confident that we are delivering a dollar's
worth of good for US interests for every dollar we spend in the
region. My staff and I look forward to working with all of you to
make our policies and programs a success. (###)
US Department of State Dispatch,
Vol 2, No 11, March 18, 1991
Title: Debt and Growth in Latin America and the Caribbean
Date: Mar 18, 19913/18/91
Category: Policy Briefs (Gist)
Region: Central America, South America, Caribbean
Subject: Trade/Economics
[TEXT]
Background
The United States is encouraging major international efforts
to help relieve Latin America's severe debt and to promote economic
growth in the region.
Latin America experienced a deep recession in the 1980s.
After vigorous expansion in the 1970s, during which annual per
capita growth averaged 3.6%, per capita gross domestic product
(GDP) fell 8.3% between 1981 and 1989. These statistics, compiled
by the UN Economic Commission for Latin America and the
Caribbean, mask wide variations from country to country. Per
capita GDP of oil-exporting countries declined more than 14% during
the period, while oil-importing countries experienced a cumulative
decline of 4.8%. Only Colombia, Chile, Barbados, and the Dominican
Republic enjoyed per capita growth.
Debt-Related Problems
Severe debt complicates future economic growth in Latin
America. In 1989, Latin America's external debt totaled $417
billion, about 40% of the total indebtedness of all developing
countries. Payments to service these obligations absorbed about
30% of export earnings (this ratio would be higher except for
substantial arrears built up by some countries).
Although debt is a major problem and debt service a heavy
burden to Latin America's developing countries, inappropriate
domestic policies have been the principal constraint on economic
growth. Lack of confidence, the result of policies such as
overvalued exchange rates, price controls, inflation induced by
government spending, and over-regulation, has hindered domestic
savings and investment, discouraged foreign investment, and led to
huge capital flight (now estimated to be at least $240 billion since
1977).
For many Latin American countries, increasing external debt
allowed them to neglect economic reform and avoid policies to
attract foreign investment. The borrowed money, therefore, often
did little to improve competitiveness and long-term growth
potential. External economic developments, such as high interest
rates in the early 1980s, commodity price fluctuations, and the
recent sharp rise in oil prices, have made the resulting deficits
much worse.
In March 1989, the United States announced several proposals
to strengthen the international debt strategy. The principal
proposal, known as the Brady Plan, encourages voluntary, negotiated
debt and debt-service reduction with commercial creditors as a
complement to new bank lending, domestic and foreign investment,
and return of flight capital in middle-income debtor countries.
Mexico, Costa Rica, Chile, Uruguay, and Venezuela have reached
Brady Plan agreements with commercial banks to restructure and
reduce their external commercial debt. These measures support
policy changes needed for sustained growth and improved living
standards for the people of Latin America and the Caribbean.
Economic Stabilization and Structural Adjustment
Debt problems have forced governments to realize that they
cannot sustain large fiscal deficits indefinitely through excessive
borrowing or monetary expansion. Recognition is growing in Latin
America that private initiative and private saving and investment
must be stimulated if sustained growth is to be realized. As a
consequence, most countries in the region now are making economic
adjustment supported by international financial institutions and
creditor countries, including the United States.
In the last few years, many Latin American governments have
begun to move away from the excessive government control, market
intervention, and import substitution strategies that they have
relied upon for decades. Most have begun to adopt more realistic
exchange rates, expand exports, and address the persistent problem
of inflation, which exceeded 1000% in countries such as Argentina,
Peru, and Brazil in 1989.
Of even greater importance for the longer term, most
governments in the region are beginning to lower structural
barriers to growth. They have taken steps to reduce price controls
and subsidies, liberalize trade, attack excessive regulation and
bureaucratic controls, and improve the investment climate,
including removing some restrictions on foreign private investment.
For example, Chile, Mexico, and Bolivia have made significant
strides toward more market-oriented economies and more open
trading. New governments in El Salvador and Honduras have shown
their commitment to market-oriented policies. Nicaragua and Peru,
two of the countries most burdened by debt, excessive government
spending, and economic mismanagement, have taken the first steps
toward restructuring and opening their economies. Other countries
have recognized the heavy burden of inefficient and highly
subsidized public enterprises that siphon domestic savings and
often increase external indebtedness. Chile and Mexico, among
others, have made progress in transferring government-owned
industries to private ownership.
In June 1990, President Bush announced the Enterprise for the
Americas Initiative to support economic reform in Latin America
and to forge a partnership with the new leadership in the region
that understands that the future for Latin America lies with free
government and free markets. The initiative, most of which still
must be approved by Congress, seeks to increase trade through
bilateral framework agreements that will lead to free trade
agreements within regions and with the United States; promote
investment by funding efforts to implement market-oriented
investment reforms and privatization; and ease the debt burden by
reducing the debt owed to the US government for countries that
adopt strong economic and investment reform programs. Latin
American and Caribbean leaders have greeted enthusiastically the
President's initiative.
International Efforts To Encourage Growth
The International Monetary Fund (IMF) and the World Bank
provide financing to encourage new commercial debt reduction
agreements and to assist debtors in pursuing fundamental economic
reform. Since 1986, the IMF has established a compensatory and
contingency financing facility to help countries continue reform in
the face of external economic shocks and two special facilities to
support structural adjustment in low-income countries. The World
Bank has taken an increasingly important role in stimulating
sustainable economic growth in debtor countries through policy-
based, fast-disbursing loans.
The United States is encouraging market-based reform through
the Enterprise for the Americas Initiative, bilateral and
multilateral economic assistance, the strengthened debt strategy,
and continued efforts to achieve free trade and open markets. The
United States is by far the largest contributor of development
assistance to the region, averaging more than $1 billion annually
over the last few years. The Caribbean Basin Initiative (CBI) gives
Central American and Caribbean countries improved US trade
opportunities, which have helped create jobs in countries with
sound economic policies. The United States has supported increases
in World Bank and Inter-American Development Bank resources to
advance economic adjustment and growth in the region. The United
States remains committed to open world markets through
multilateral trade negotiations.
Further Information
For the origin of debt-related problems, as well as US policy
regarding debt and growth in the region, see the Gists on "Third
World Debt" and the "Enterprise for the Americas Initiative," US
Department of State Dispatch, September 24, 1990, Vol. 1, No. 4.
(###)
US Department of State Dispatch,
Vol 2, No 11, March 18, 1991
Title: Fact Sheet: Albania
Date: Mar 18, 19913/18/91
Category: Fact Sheets
Region: E/C Europe
Country: Albania
Subject: Democratization, History, Trade/Economics
[TEXT]
US-Albanian Relations. Albanian Foreign Minister Muhamet
Kapllani and Assistant Secretary Raymond Seitz signed a
Memorandum of Understanding on March 15 resuming diplomatic
relations between the United States and Albania (see p. 198). The
Foreign Minister also met with Acting Secretary of State Robert
Kimmitt, Members of Congress, and other US officials.
The US seeks to support the movement toward democratic and
economic reform in Albania and to expand relations in the cultural
and economic fields. Relations between the United States and
Albania ended in June 1939, when Italy took over the conduct of
Albanian foreign affairs. In 1945, an informal US mission was sent
to Albania to study the possibility of establishing relations with
the National Liberation Front (NLF) regime. However, the regime
refused to recognize the validity of prewar treaties and
increasingly harassed the US mission, which was withdrawn in
November 1946. The United States had no contact with the Albanian
government between 1946 and 1990.
Location and Population.
Albania, one of the smaller countries in Europe, is located on the
Adriatic Sea and borders Yugoslavia and Greece. Ninety-six percent
of the 3 million inhabitants are ethnic Albanians.
Background
Prior to the 20th century, Albania was a nation subject to foreign
domination except for a brief period of independence from 1443 to
1478. The Albanians declared independence from the Ottoman Turks
in 1912. After the upheaval of World War I, Albania was
reestablished as an independent state largely through the efforts of
President Woodrow Wilson at the Paris peace conference, and
remained independent until Mussolini invaded the country in 1939.
After Italy's surrender in 1943, German troops occupied the
country and were challenged by the communist-led NLF, which
gained control in November 1944. Yugoslav communists were
instrumental in establishing the Albanian communist party in
November 1941, and the NLF regime became a virtual satellite of
Yugoslavia until the Tito-Stalin break in 1948. Albania's hard-line
communism led to growing difficulties with the Soviet Union under
Krushchev and came to a head in 1961 when the Soviet leaders
openly denounced Albania at a party congress. The two broke
diplomatic relations later that year. However, Albania continued
its charter membership in the Warsaw Pact until the 1968 invasion
of Czechoslovakia.
China emerged as Albania's staunch ally and primary source of
economic and military assistance. But this close relationship
faltered during the 1970s when China decided to seek a
rapprochement with the United States. After years of rocky
relations, an open split came in 1978, when the Chinese government
ended its aid program and terminated all trade. Although the two
renewed trade in 1983, diplomatic relations are cool and inactive.
In the late 1970s, after the break with the Chinese, the
Albanians sought closer economic and cultural ties to Western
Europe in an attempt to find alternative markets for their former
exports to China. Since then, ties generally improved with selected
Western states--such as Italy and Greece--but Albania has
continued to pursue an independent foreign policy.
Political Conditions
Albania is scheduled to hold its first multi-party elections since
1945 on March 31, 1991, with a run-off round on April 14. This
election will choose members for the 250-seat People's Assembly,
the unicameral legislative body.
According to the current constitution, adopted in 1976, the
People's Assembly is the supreme organ of government. In practice,
however, the assembly has met only a few days each year to ratify
actions taken in its name by the presidium of the assembly, the
chairman of which is the head of state.
The Albanian Party of Labor, which has about 125,000
members, was the only legally functioning party in Albania until the
government decision on December 11, 1990, to permit the formation
of other parties to compete in the legislative elections. Several
new parties have been registered, including the Democratic Party,
the Republic Party, and the Ecology Party. Bowing to the wishes of
several newly formed parties, the government delayed the elections
from February 10 to March 31. In late December, the government
authorized the publication of independent newspapers, and both the
Democratic and Republic parties are now publishing their own
newspapers. The government also has announced its support for
limited economic reform and has released a number of political
prisoners. President Alia announced on March 12 that about 200
prisoners believed to be held on political grounds would be released
this month.
Demonstrations in support of a faster pace of reform, as well
as demonstrations in support of the policies of former leader Enver
Hoxha, continue in Albania's major cities. A large number of
Albanians, dissatisfied with economic and political conditions, have
sought to leave the country by entering Yugoslavia or Greece, or by
sea to Italy.
Economy
As the poorest country in Europe, Albania's development lags behind
other countries of the region. The Stalinist-type economy operates
on the principles of central planning and state ownership of the
means of production. In recent years, Albania has implemented
limited economic reforms to stimulate its lagging economy,
although they do not go nearly so far as current reforms in the USSR
and Eastern Europe. Attempts at self-reliance and a policy of not
borrowing from international lenders have greatly hindered the
development of a broad economic infrastructure. Albania, however,
possesses considerable mineral resources and is largely self-
sufficient in food. Numerical estimates of Albanian economic
activity are subject to an especially wide margin of error because
the government has not publicly released data and has pursued a
policy of diplomatic isolation.
Foreign Policy
Albania has moved away from its virtually total diplomatic
isolation, motivated, in large part, by the government's desire to
improve its flagging economy. Recently, Albania has participated as
an observer in meetings of the Conference on Security and
Cooperation in Europe (CSCE) and has participated in ministerial-
level meetings furthering Balkan cooperation. It resumed relations
with the Soviet Union in 1990. (###)
US Department of State Dispatch,
Vol 2, No 11, March 18, 1991
Title: Country Profile: Albania
Date: Mar 18, 19913/18/91
Category: Country Data
Region: E/C Europe
Country: Albania
Subject: Trade/Economics, History,
International Organizations
[TEXT]
Official Name: People's Socialist Republic of Albania
Geography
Area: 28,750 sq. km. (11,100 sq. mi.); slightly larger than
Maryland.
Cities: Capital--Tirane. Other cities--Durres, Elbasan, Vlore,
Korce, Shkoder.
Terrain: 77% mountainous, 23% fertile river valleys and
coastal lowlands.
Climate: Mediterranean along coast, and varied temperate
inland.
People
Nationality: Noun and adjective--Albanian(s).
Population (1990): 3.2 million. Annual growth rate: 1.9%.
Density: 111 per sq. km. (288 per sq. mil.); rural 66%, urban
33%.
Ethnic groups: Albanian (Gegs and Tosks) 90%, Greeks 8%, other
2%.
Religions: Albania claims to be the world's first atheist state;
all churches and mosques were closed in 1967 and religious
observances prohibited; pre-1967 estimates of religious affiliation:
Muslim 70%, Albanian Orthodox 20%, Roman Catholic 10%.
Government
Type: Communist. Constitution: 1976.
Branches: Executive--President of the Presidium of the
Peoples Assembly (chief of state); chairman, Council of Ministers
(head of government). Legislative--unicameral Peoples Assembly
(Kuvendi Popullor). Judicial--supreme court; regional and district
courts.
Subdivisions: 26 districts (rrethe).
Political parties: Albanian Workers Party, Democratic Party,
Republican Party, Ecology Party. Suffrage: Universal and
compulsory over 18.
Elections: Scheduled for March 31, 1991.
Defense (1986): 10.9% of budget.
National holiday: Liberation Day, November 29.
Flag: Black, two-headed eagle centered on a red field; above
the eagle is a red star outlined in yellow.
Economy
GNP (1989 est): $3.8 billion. Per capita income (1989 est):
$1,200.
Natural resources: Oil, gas, coal, chromium, copper, timber,
and nickel.
Agriculture: Arable land per capita among the lowest in Europe;
60% of work force engaged in farming; produces wide range of
temperate-zone crops and livestock; claims self-sufficiency in
grain output. Products--wheat, corn, potatoes, sugar beets, cotton,
tobacco.
Industry: Types--food processing, textiles and clothing,
lumber, oil, cement, chemicals, basic metals, hydropower.
Trade (f.o.b. 1987 est.): Exports--$378 million: asphalt,
bitumen, petroleum products, metals and metallic ores, electricity,
oil, vegetables, fruits, tobacco. Imports--$255 million: machinery,
machine tools, iron and steel products, textiles, chemicals,
pharmaceuticals. Major partners--Yugoslavia, Czechoslovakia,
Romania, Italy, Poland, Germany, France, Greece, Bulgaria, Hungary.
Official exchange rate (1986): 8 leks=US $1.
Fiscal year: Calendar year.
Membership in International Organizations
UN and some of its specialized and related agencies, including
the International Atomic Energy Agency (IAEA), International
Telecommunications Union (ITU), World Health Organization (WHO),
Food and Agriculture Organization (FAO), Universal Postal Union
(UPU), and World Meteorological Organization (WMO). (###)
US Department of State Dispatch,
Vol 2, No 11, March 18, 1991
Title: Memorandum of Understanding Between the United States
and Albania
Date: Mar 15, 19913/15/91
Category: Fact Sheets
Region: E/C Europe
Country: Albania
Subject: International Law, State Department
[TEXT]
The Government of the United States of America and the Government
of the People's Socialist Republic of Albania, as a result of
discussions of their representatives and considering that the
Governments have re-established diplomatic relations effective
this date, have agreed as follows:
Article I
1. The Governments shall conduct their diplomatic relations in
accordance with the Charter of the United Nations, signed at San
Francisco on June 26, 1945, and the Vienna Convention on
Diplomatic Relations, signed at Vienna on April 18, 1961, to which
both Governments are parties. The Governments shall exchange
diplomatic representatives with the rank of Ambassador
Extraordinary and Plenipotentiary, as soon as the necessary
administrative and legal arrangements in the sending State so
permit.
2. The two Governments shall provide all necessary assistance
for the early establishment, and performance of the functions,
including consular functions, of diplomatic missions in their
respective capitals, in accordance with international law and
practice. Such assistance shall include, inter alia, consent to the
use of wireless transmitters including the use of satellite links, by
the respective Embassies for purposes of official communication,
subject to compliance with the laws and regulations of the
receiving State. Such laws and regulations shall, however, be
applied so as to give full effect to the consent hereby recorded.
3. The Governments affirm their intent to respect the
fundamental principles on which diplomatic intercourse is based,
including, inter alia, the principle of inviolability of the premises
of the diplomatic mission.
4. The two Governments shall extend the privileges and
immunities of diplomatic agents, as defined in the Vienna
Convention on Diplomatic Relations, to those members of their
respective administrative and technical staffs of the diplomatic
missions accredited to Washington and Tirana, as well as their
families. The stated privileges and immunities will not be accorded
to persons who are nationals or permanent residents of the
receiving State.
5. The two Governments intend to hold discussions on the
conduct of consular relations at the earliest practicable time. Until
such time, the two Governments agree to the following interim
practical arrangement:
If a citizen of the sending country is arrested or detained in
any manner, the authorities of the receiving country shall, within
72 hours, notify the designated representative of the sending
country of the arrest or detention of the person and permit within
24 hours of such notification access by a representative of the
sending country to the citizen who is under arrest or detained in
custody.
Article II
The two Governments intend to promote relations in economic,
cultural and other fields.
Article III
The Treaty of Naturalization signed at Tirana on April 5, 1932,
shall terminate upon the entry into force of this Memorandum of
Understanding. In this connection, the Government of the United
States of America notes that the statement made in paragraph 2 of
the diplomatic note delivered on June 23, 1922, by the American
Commissioner in Tirana to the President of the Council and Minister
of Foreign Affairs of Albania concerning the "interpretation and
application of laws affecting naturalization in the United States"
has for a number of years ceased to be an accurate representation
of United States law.
Article IV
Following the re-establishment of relations, the two
Governments, upon the request of either side, shall enter into
negotiations for the prompt settlement of claims and other
financial and property matters that remain unresolved between
them, each Government being entitled to raise during such
negotiations the matters it wishes to be addressed.
Article V
This Memorandum of Understanding shall enter into force upon
signature.
Done at Washington, in duplicate, in the English and Albanian
languages, this 15th day of March, 1991.
For The Government Of The United States: Raymond Seitz
For The Government Of The People's Socialist Republic Of Albania:
Muhamet Kapllani
Joint Communique, March 15, 1991 [Box]
The Government of the United States of America and the
Government of the People's Socialist Republic of Albania, following
consultations between their duly authorized representatives, and
having confirmed their commitment to the principles of equality,
mutual respect, and mutual benefit, have decided to re-establish
diplomatic relations with effect from March 15, 1991, and
subsequently to exchange diplomatic missions at the level of
Ambassador. (###)
US Department of State Dispatch,
Vol 2, No 11, March 18, 1991
Title: International Women's Day
Bush
Source: President Bush
Description: Letter from President Bush delivered to the UN
Commission on the Status of Women by Ambassador Juliette
Clagett McLennan, US Representative to the Commission,
Vienna, Austria
Date: Mar 8, 19913/8/91
Category: Speeches, Testimony, Statements
Subject: Human Rights
[TEXT]
Barbara and I are delighted to send warm greetings to the
members of the UN Commission on the Status of Women on the
occasion of the International Women's Day. We welcome the
opportunity to reaffirm the professed purpose of your organization,
which is to uphold fundamental human rights, the dignity and worth
of the human person, and the equal rights of men and women.
This is an important session of the commission because it
addressed the specific problems of those women around the world
who are most in need of help: women who are displaced, women
with disabilities, women who are refugees or migrant workers, and
women who are single parents. In determining how best to assist
those with particularly dire needs, we lend our support to policies
that foster self-sufficiency and equal opportunity. We are pleased
that many of the recommendations made by your commission also
seek to make women full and active partners in decisions that
directly affect their lives and those of their families.
The United States remains committed to advancing the status
of women, both at home and throughout the world. I applaud the
worthy goals of your organization, as well as your efforts to
develop programs and policies that offer women greater
opportunities to participate freely in the social, political, and
economic mainstream.
On this International Women's Day, I send best wishes for a
productive 35th session.
GEORGE BUSH (###)
US Department of State Dispatch,
Vol 2, No 11, March 18, 1991
Title: Displaced Persons in the Middle East
Date: Mar 18, 19913/18/91
Category: Fact Sheets
Region: MidEast/North Africa
Country: Iran, Syria, Jordan, Turkey
Subject: Refugees, Development/Relief Aid
[TEXT]
Post-war displaced persons outflows in the Middle East
continue to be steady but not large. Foreign nationals arriving in
the asylum states (Iran, Turkey, Syria, and Jordan) are mainly, but
not exclusively, Egyptians and Sudanese. In early March, the League
of Red Cross and Red Crescent Societies (LICROSS) reported that
about 2,000-2,500 Egyptians returned to Egypt daily; probably not
all of these were from the asylum states. The International
Organization for Migration (IOM) stated that most of its
repatriation caseload in Iran was Sudanese. Small but steady
numbers of Iraqis were entering Turkey, while increasing numbers
of Iraqis, Iranians, and third-country nationals were crossing into
Iran. Syria received very few displaced persons.
Because of ongoing civil unrest, an area of obvious and
immediate concern is the potential for substantial numbers of
refugees arriving at the Kuwait-Iraq border. Efforts are underway
to assess their numbers and condition. The revised UN Plan of
Action does not provide for a relief presence on the Kuwait-Iraq
border; the International Committee of the Red Cross (ICRC) is
assessing the situation and will respond.
Given the current civil unrest inside Iraq, officials of both the
asylum states and international relief organizations remain
concerned about the possibility of large migrations of displaced
persons. Preparations and improvements of camp facilities
continue in the asylum states. Both the United Nations and ICRC are
holding stockpiled materials for deployment in the region if needed.
Private Contributions
The following organizations are accepting private
contributions.
UN Disaster Relief Office (UNDRO)--covers UNDRO, World Food
Program, UN Children's Fund, UN Development Program, UN High
Commissioner for Refugees
Address: Phillippe L. Boulle, Director, UNDRO, Room S-2935,
New York, NY 10017 Phone: (212) 963-5704
Earmark contribution: Fund for Displaced Persons in the Gulf
American Red Cross--covers ICRC and LICROSS
Address: American Red Cross, PO Box 37243, Washington, DC
20013 Phone: (202) 639-3314
Earmark contribution: Middle East International Response
US Association for International Migration--covers IOM
Address: USAIM, 1750 K Street, NW, Suite 1110A,
Washington, DC 20006 Phone: (202) 862-1826
Earmark contribution: IOM Airlift (###)
US Department of State Dispatch,
Vol 2, No 11, March 18, 1991
Title: Focus on Central and Eastern Europe: Overview of US
Assistance
Date: Mar 18, 19913/18/91
Category: Focus on Emerging Democracies
Region: E/C Europe
Subject: Trade/Economics, Development/Relief Aid
[TEXT]
US Assistance to Central and Eastern Europe
In response to the revolutions of 1989 in Central and Eastern
Europe, the US government has mounted a far-reaching program of
regional assistance. In December 1989, President Bush designated
Deputy Secretary of State Lawrence S. Eagleburger as Coordinator
of US Assistance to Central and Eastern Europe. The President also
appointed Treasury Deputy Secretary John E. Robson and Council of
Economic Advisers Chairman Michael J. Boskin to be deputy
coordinators. Ambassador Robert L. Barry is Mr. Eagleburger's
Special Adviser for East European Assistance.
There are now more than 30 US government agencies involved
in this effort. The US government, however, cannot by itself
provide all of the assistance that is needed. It cannot transfer the
entrepreneurial energy or professional skills required to ensure the
transition to a market economy. That is the role of private
business. There is also a role for US trade unions, non-
governmental organizations (NGOs), and private voluntary
organizations (PVOs). This edition of Focus outlines the steps that
businesses, NGOs, PVOs, and other private organizations could take
to become involved in the ongoing assistance program for Central
and Eastern Europe. It also provides the addresses and telephone
numbers of relevant US government offices and other related
offices that are resources for the private sector.
NGOs, PVOs, and Others
Priorities and policies for US assistance to Central and
Eastern Europe are set by the Department of State's Office of the
Coordinator of East European Assistance (see Dispatch Vol. 2, No. 5
for a summary of those policies and priorities). The US Agency for
International Development (USAID) receives most of the money
appropriated for assistance to the region and is responsible for
implementing projects with those funds. Most of these projects are
open for competitive bidding by the private sector, although a small
amount of money is transferred to US government agencies that
have expertise in particular priority areas. For example, the
Department of the Treasury will be directing technical-assistance
projects in the financial sector.
Projects are being developed in several categories of
assistance ranging from humanitarian assistance to help in setting
up a private banking system. USAID will be releasing requests for
proposals and requests for applications for these projects, which
will be advertised in the Commerce Business Daily or other
appropriate channels.
There may be questions regarding particular programs that are
identified in the legislation or referred to in legislative reports. If
there are questions as to whether or not a project will be
implemented in a particular area, NGOs, PVOs, and others should
contact USAID's Office of European Affairs (202-647-3853) or the
Office of the Special Adviser for East European Assistance to the
Deputy Secretary of State (202-647-0695) for clarification and
advice. Personnel in those offices can say whether or not there will
be projects in particular areas and how to get more information if
necessary.
US Business
For the most part, funds appropriated for assistance to Central
and Eastern Europe cannot be used for purely commercial ventures.
Rather, they are intended for use in providing technical assistance
and other help to establish the conditions under which free-market
enterprises can flourish. In this way, the US government seeks to
prepare the way for US private-sector investment in Central and
Eastern Europe.
There are several sources of governmental and non-
governmental information and possible funding of which US
businesses interested in the region should be aware. The
Departments of Commerce and Agriculture provide information
about the economic/commercial climates and business
opportunities in Central and Eastern Europe. They also sponsor
trade missions and seminars and participate in trade fairs in the
region. US firms interested in becoming active in Central and
Eastern Europe should also contact the Overseas Private Investment
Corporation, the Export-Import Bank, and the Trade and Development
Program.
US businesses should make the Eastern Europe Business
Information Center (EEBIC) in the Department of Commerce their
initial point of contact when considering trade and investment in
Central and Eastern Europe. The EEBIC provides the business
community with "one-stop shopping," serving as the clearinghouse
for information on economic/commercial conditions and market
opportunities in the region and on all US government programs that
support the activities of US private enterprise there. The EEBIC
also publishes the Eastern Europe Business Bulletin, a bimonthly
newsletter on business opportunities in Central and Eastern Europe.
For country policy guidance, US companies should contact the
Commerce Department's Eastern Europe Division. Overseas,
Commerce's US and Foreign Commercial Service offers trade-
promotion information and advocacy on behalf of US firms from all
US embassies in Central and Eastern Europe, except Sofia, Bulgaria,
where the Department of State offers similar services.
The Department of State's country officers in the Bureau of
European Affairs, the Bureau of Economic and Business Affairs, and
the Office of the Special Assistant to the Secretary/Coordinator for
International Labor Affairs can provide additional information.
Those businesses involved in the telecommunications sector
should contact the Communications and Information Policy Bureau
of the Department of State, the Federal Communications
Commission, and the National Telecommunications and Information
Administration of the Department of Commerce.
Below is a description of private organizations and US
government agencies most directly involved in supporting US
business in Central and Eastern Europe.
Enterprise Funds
Under the Support for East European Democracy (SEED) Act of
1989, the Congress authorized $300 million for the establishment
of two enterprise funds for Hungary and Poland. In November 1990,
President Bush announced the creation of a similar fund for
Czechoslovakia that would be capitalized at $60 million over a
multi-year period.
The Polish-American Enterprise Fund (authorized at $240
million) and the Hungarian-American Enterprise Fund ($60 million)
promote the development of the private sector in those two
countries. Funds are provided through grants, loans, equity
investments, and support for training and technical assistance. The
two funds invest primarily in Polish-owned or Hungarian-owned
companies, Polish-American or Hungarian-American joint ventures,
and occasionally in subsidiaries or affiliates of US companies with
business operations in Poland or Hungary. The funds focus on small
and medium-sized companies. US businesses interested in obtaining
capital from the funds should be prepared to submit proposals of no
more than 3-5 pages. After an initial review, a more detailed
business plan may be required.
Details and financing arrangements for a Czechoslovak-
American Enterprise Fund are being prepared. The new fund is
expected to be similar to its Hungarian and Polish counterparts.
Addresses and telephone numbers of the funds are below.
Overseas Private Investment Corporation (OPIC)
OPIC is a self-sustaining US government agency whose purpose
is to promote economic growth in developing countries and
emerging democracies by encouraging US private investment in
those nations. By doing so, OPIC can help American companies
remain competitive in the international marketplace.
OPIC assists US investors through two principal programs:
-- Financing investment projects through direct loans and/or
loan guarantees and
-- Insuring investment projects against a broad range of
political risks.
As part of new US initiatives toward Central and Eastern
Europe in 1989, Congress authorized OPIC to operate in Hungary and
Poland. Subsequently, OPIC has begun to operate in Czechoslovakia
and the eastern region of Germany. OPIC has been in Yugoslavia
since 1973. OPIC suspended its operations in Romania in 1987 due
to worker-rights concerns and has not yet reopened. Work has begun
on a bilateral agreement with Bulgaria.
OPIC conducts investment missions for US companies to look
at investment opportunities. In November 1989, OPIC led a mission
of 29 US companies to Poland. During 1990, more than 80 US
companies participated in OPIC missions to the eastern region of
Germany, Hungary, and Poland. Since October 1989, more than 200
US firms have registered for OPIC investment insurance or
financing for projects in Central and Eastern Europe.
In addition to investment missions, OPIC also works closely
with other US government agencies to provide conferences to
encourage US business involvement in Eastern Europe. OPIC also
helps ensure that it is supporting the enterprise funds wherever
appropriate.
US Trade and Development Program
The Trade and Development Program (TDP) is an agency of the
US government's International Development Cooperation Agency.
TDP promotes US exports for major development projects in
middle-income and developing countries by funding feasibility
studies, consultancies, training programs, and other project-
planning services. In Central and Eastern Europe, TDP assists US
firms by identifying major development projects that offer large
export potential and by funding US private-sector involvement in
project planning. This should position US firms for follow-on
contracts when these projects are implemented.
TDP invites Central and East European governments to apply
for grant assistance for planning studies of major public-sector
projects. Such projects should include plans to allocate substantial
resources for foreign goods and services. Official requests for TDP
assistance may be made directly to TDP in Washington by the
appropriate foreign local government agency or ministry, or through
a US embassy.
If TDP approves the request for assistance, US firms are asked
to conduct the study under competitive bidding by the foreign
government agency. While TDP makes direct payment to the
contractor selected, these studies are implemented under the
control and direction of the foreign government agency. Studies are
given to the foreign government for further action. Any projects
resulting from these studies are competitively bid by the foreign
government.
Export-Import Bank of the United States
The Export-Import Bank (Eximbank) is an independent US
government agency that helps the American business community
export goods and services by offering financing support. Through a
wide variety of loan-guaranty and insurance programs, the Eximbank
has supported more than $200 billion in US exports since 1934.
Eximbank programs for US businesses interested in Central and
East European markets include short- and medium-term trade-
credit insurance and medium- and long-term loans and guaranties
for financing