US Department of State 

Dispatch, Vol 2, No 31, August 5, 1991

Title:

US-Turkish Relations

Bush, Ozal Source: President Bush, President Ozal Description: Ankara, Turkey Date: Jul 20, 19917/20/91 Category: Speeches, Testimony, Statements Region: Europe Country: Turkey Subject: Trade/Economics, Security Assistance and Sales, Democratization [TEXT]
Deepening Political Dialogue
Opening statements by Turkish President Ozal and President Bush from news conference following their talks in Ankara, July 20, 1991.
President Ozal:
Ladies and gentlemen, having just completed the main part of our talks which covered a wide range of issues, President Bush and I are now ready to face what might turn out to be the most delicate part of our program--taking on the press. I will now make a short introductory statement, which I believe will be followed by one of President Bush later. We will be glad to take your questions. As your background briefs probably note, this is the second visit to Turkey by an American President and the first one since 1959. This alone makes President Bush's presence an honor and historic occasion. On a personal basis, my wife and I are particularly happy to be able to reciprocate the warm hospitality that was accorded to us by President and Mrs. Bush during our visit to the United States. You all know that during the recent months President Bush and myself consulted each other frequently and, on occasions, almost daily. Although these consultations dealt with the immediate concern of those days, they nevertheless underline the unity of course and parallelism of approach between our two countries. During my last visit to the United States, we had intense discussions in the relaxed atmosphere and seclusion of Camp David. There we came to recognize that our long-standing relations and cooperation have reached strategic dimensions which offered our nations real possibilities. We decided that we should work together and turn these possibilities into lasting benefits. Today we went further on these issues. We noted that the friendship and cooperation that exists between our two countries not only serve our interest on the bilateral level but also constitute an essential element of the broader partnership between the United States and Europe as a whole. It's clear that Turkey's taking its rightful place in Europe in integration will have important implications--on the stability of regions neighboring Turkey and, ultimately, on the peace and stability of Europe and the world. These call for a deepening of our political dialogue. We agreed that while the recent developments in the European security environment allow for a more effective pursuit of dialogue and cooperation as a means for enhancing security, an adequate defense posture is still an essential element in facing prevailing uncertainties and instabilities. Accordingly, the United States has a keen interest in the modernization of Turkish armed forces. On the economic front, we both believe that free trade should be the driving force in our commercial ties and that there is a need for enhancing and diversifying our economic relations through increased and balanced trade and greater US investments and joint ventures in Turkey. Furthermore, we are convinced that the scope of our relations would be incomplete if cooperation areas such as education, science, health, technology, and culture are neglected. The strategic dimension that our relations have already reached and the agenda we have set for the future necessitate arrangements for an institutional framework which will enable us to monitor the progress that we hope to achieve. This is why we have decided to set up a permanent mechanism for consultations which will bring together our high level officials on a regular basis. Different groups each asked to deal with a different field of cooperation will meet as needed, but at least once a year, and work to further our ties. A steering group co-chaired by the Under Secretaries of the Turkish Foreign Ministry and the US State Department will be created to monitor and report the progress achieved. This group will meet twice a year. As you might expect, we also discussed the question of Cyprus. I confirmed that Turkey is fully committed to a negotiated settlement mutually acceptable to the Turkish Cypriot and the Greek Cypriot peoples of the island and that political equality, bi- commonality, bi-zonality, and the maintenance of Turkey's effective guarantee are essential to a just and viable peace there. I emphasize that UN Security Council Resolution 649 provided the necessary framework for such a settlement. And that quadripartite meeting I suggested recently, to be held in accordance with the political equality of the two Cypriot parties, could provide the much-needed turning point. In summary, ladies and gentlemen of the press, this has been a most fruitful visit. I hope and pray that what we, as the heads of state of our countries, have set out to accomplish today will be for the good of our nations and constitute a milestone in our longstanding ties.
President Bush:
Thank you, Mr. President. And I'm in Turkey to pay my respects to this great nation with which my country has been so close for so many years. President Ozal and I have had excellent talks today. He is a courageous leader who has gained great credit and stature for Turkey in the world. And I was also pleased, if I might say so, to meet at his house, his residence, with Turkey's very impressive, new young Prime Minister Mesut Yilmaz, and I want to thank him over here for the time he gave me for fruitful talks as well. We value Turkey's NATO partnership, its commitment to democracy, and its integral position in the Western community. And Turkey played a critical role, as we all know, in the international coalition that liberated Kuwait, valiantly serving our common interests in a lawful, international order and a stable region. President Ozal and Mr. Prime Minister, thank you for today's work. Both of us agreed--all three of us agreed today to build a new strategic relationship based on closer political, security, and, yes, economic links. In this spirit, the United States supports Turkey's military modernization, including its 160-plane F-16 development program. And we have pledged to expand our trade and investment--a point very important to both countries--and to develop new avenues of cooperation in a lot of fields: education, environment, science and technology, medicine, and others. And, finally, I believe that an opportunity may exist for progress on the Cyprus problem. The United States is committed to support the efforts of the UN Secretary General in whatever way we can. And I'm also convinced that the Turkish leadership is serious about building new and better ties with the Greek Government of my friend, Prime Minister Mitsotakis. Let me close, Mr. President, with saying how deeply moved I was and Barbara was, and I expect all of us were, by the warmth of the reception from the Turkish people when we came in from the airport. No one is so sophisticated that those outpourings of interest in and, I think, affection for one's country--and in this instance the United States--[don't] make a difference. I mean, it makes a tremendous difference. And I can't tell you how moved and touched I was--the little children all the way up to the old men and women who greeted us along the side of the road. And I think that started this visit off on a very high plane. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

US-Turkish Relations

Bush Source: President Bush Description: Dolmabahce Palace, Istanbul, Turkey Date: Jul 21, 19917/21/91 Category: Speeches, Testimony, Statements Region: Europe Country: Turkey, Greece Subject: Trade/Economics, Security Assistance and Sales, Democratization [TEXT]
An Alliance Built on a Shared Commitment to Freedom
Remarks at Dolmabahce Palace, Istanbul, Turkey, July 21, 1991. Mr. President and Speaker of the Parliament, Mr. Prime Minister, members of the Turkish Government, Barbara and I want to thank you for this warm welcome. And I am deeply honored to be the first American president to come to this historic city. Among the nations of the world, few claim a past as storied as yours. Turkey stands at a crossroads of cultures and civilizations. Here in Istanbul, one city spans two continents. This city's ancient history is written for all to see in marble, stone, and gold and in the monumental grandeur of the Hagia Sophia, the serenity of the Blue Mosque, the courts of Topkapi, and here in this beautiful palace--a treasure house of Turkish art and architecture. Like Istanbul, Turkey is east and west, ancient and modern. For in Turkey, what might elsewhere appear as contradictions are dazzling facets of culture and character. In this magnificent palace--testament to Turkey's past--in the presence of the men and women entrusted with the future of this nation, it is fitting to speak about new and old, about our new world of change, about the enduring partnership that binds our two nations. This partnership grows out of a shared devotion to the international ideal--the understanding that responsible nations must work together to repel aggression to preserve the peace. From the days of the Korean war, and the legendary bravery of the Turkish brigade, through the long years of the Cold War, as partners in the NATO alliance and today in our effort to forge a new world order, Turkey has stood for this international ideal. For 40 years, Turkey played a strategic role as the bulwark of NATO's southern flank. The alliances, and Turkey's steadfast adherence to common values and interests produced a stunning triumph. Democracy triumphed over totalitarianism in eastern Europe, and the Cold War yielded to prospects for a different kind of world. Then came Iraq's invasion of Kuwait--an act that defied all that the United States and Turkey stand for--an act that exposed your entire region, this entire region--to brutal aggression. Turkey's response, as a key member of the international coalition, stands as a tribute to the leadership of President Ozal, to the professionalism of the Turkish military, and to the great heart of the Turkish people. Turkey's actions as a pivotal coalition member demonstrated again our readiness to defend our common values and interests. It proved that our alliance was built not upon the fear of communism, but out of a profound, shared commitment to freedom and democracy. All during the world's effort to use diplomacy to get Iraq's brutal dictator to remove his forces from Kuwait and then during Desert Shield and Desert Storm, President Ozal and I were in constant touch. There was no individual in any country that was more resolute, more determined to see international law prevail. Once the decision was made to use force, difficult decision that it was, no ally was more solid than Turkey, no leader more staunch than your president--President Ozal. Our work as friends, allies, and coalition partners continues today. Our two nations are part of a newly formed residual force stationed near Turkey's border with Iraq. All of us understand that this force will not stay permanently. But we also understand the importance of sending a strong, unmistakable signal to Saddam Hussein: He must not resume war against his own people. Mr. President, Mr. Prime Minister, our nations for years have fostered a strong relationship. Turkey's stand in the Gulf demonstrated that relationship's strength. Tonight, let us pledge to build further upon our common ties and aims, to strengthen the links our governments have forged. In years to come, we will continue to back our warm words with firm deeds. Our administration hopes to deliver a $625- million military assistance program in 1992--a substantial increase. We support Turkey's production of 160 F-16s. But this new strategic relationship between our nations points beyond simply the military dimension to expanded trade and increased investment in one of Europe's most dynamic economies. Well before the fall of the Berlin Wall and the advent of free- market forces in Eastern Europe, Turkey launched an ambitious reform program. In the 1980s, Turkey outpaced every nation in the OECD [Organization for Economic Cooperation and Development] in economic growth. In the 1990s, as the new nations discover the power of free enterprise, as democracy dispels a long dark era of division and distrust, Turkey can regain its historic place as a trade hub, uniting Europe, East and West, Asia, and the Middle East. Finally, our new relationship means building new bridges-- bringing together the best minds in both our nations in the fields of science and technology, medicine, and the environment; opening the doors to our universities, opening our minds to each others' ideas, cultures, and traditions. The people of our two nations have known and admired each other as allies. It's time now for our people to get to know each other better as friends. A key to this new relationship lies in the opportunities now opening as a direct result of a decade of democracy. Turkey today is a nation confident of its place in the world--a confidence made clear in your nation's opening to the new democracies of Eastern Europe--and your growing relationship with the Soviet Union. Your Black Sea initiative, aimed at expanding trade with the Soviets and other nations that border that great body of water, illustrates the promise of what I have called the new world order. East-West confrontation has made way for trade and cooperation, the cornerstones of lasting peace. These initiatives promise increased prosperity for the Turkish people and increased security for the Turkish republic. In the famous words of Ataturk, "Peace at home, peace abroad," remains a worthy goal for all nations. That means we must begin building a lasting peace right here in the eastern Mediterranean. In the past 2 days, in Ankara and on the island of Crete, I have honored the memories of Kemal Ataturk and Eleutherios Venizelos--two statesmen whose every thought was for the good of their nations; two statesmen who earlier this century made possible a generation of peace between Turkey and Greece. Once again, Turkey and Greece have both produced leaders of vision--both trusted friends of mine. And as a friend of Turkey, let me say the time has come for a new opening to a neighbor and fellow NATO ally. The time has come for lasting peace between Turkey and Greece. After all, Greece and Turkey have been allies in NATO, partners in the coalition that liberated Kuwait, free European nations devoted to a common ideal; so this sad chapter of ill will must end. No two nations who cherish democracy should regard each other as enemies. This opening must include movement on the Cyprus question. In less than 2 years' time, we have witnessed a chain reaction--a chain reaction of change that has swept away the Berlin Wall, and with it, 4 decades of totalitarian rule and the ever-present risk of global war. So the message I bring to Turkey and Greece is simply this: We've seen too much change in the world to settle for the status quo between your two great countries -- both, I'm proud to say, friends of the United States of America; both of whom stand to gain much through friendship. We've seen too much change in this region and throughout the world to stand for the status quo in Cyprus. We support the efforts of [UN] Secretary-General Perez de Cuellar to open the door to a solution for the problem. But I would like to tell the people of Turkey what I've told the people of Greece: The solution lies in your hands. Your friends can and will offer encouragement and support, but only Greeks, Turks, and Cypriots can reach an effective, lasting resolution. I believe the time is right to break through the barrier, tear down the old taboos, and build a lasting peace. When I see the wealth of leadership -- President Ozal, Prime Minister Elmas, Mr. Denktesh, President Karamanlis, Prime Minister Mitsotakis, President Vassiliou -- I know the leadership exists in Turkey, Greece, and Cyprus to set aside old animosities and seize an opportunity for real peace. Mr. President and Mr. Prime Minister, members of the Turkish Government, leaders here with us tonight, I am confident that Turkey can rise to this challenge. A decade of free government and free enterprise have made Turkey a rising star of Europe. Politically and economically, Turkey is today a nation transformed. There should be no question that Turkey deserves entry into the European Community and the Western European Union, and Turkey can count on America's strong support. Turkey stands as a model to those who strive for free elections and free markets. Regimes that force the false choice between progress and piety, between technology and tradition, stand refuted by your experience. Turkey proves that a nation can build a flourishing democracy and a modern economy, can embrace freedom and tolerance and still sustain its ancient face. Turkey aims at the vision of Ataturk--a vision all around us evident in this city, with it minarets and modern skyscrapers, a vision that marks out Turkey's destiny in the region, in Europe, and in the world beyond. More than 30 years ago, President Eisenhower came to your country on a pilgrimage of freedom--a visit that I know some may remember. In the generation since then, Turkey turned promise into prosperity, creating a future few would have thought possible. But for all that has changed, one fundamental fact remains the same, in the words of Eisenhower, "No power on earth, no evil, no threat, can frustrate a people of your spirit." Once again, I thank all of you for the warm welcome that Barbara and I have received in Ankara, and here in this fantastic city of Istanbul. May our two nations always work to preserve peace, freedom, and prosperity, and may God bless the people of Turkey. Thank you all very, very much.
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

US-Turkish Relations

Bush, Ozal Source: President Bush, President Ozal Description: Istanbul, Turkey Date: Jul 22, 19917/22/91 Category: Speeches, Testimony, Statements Region: Europe Country: Turkey, Greece Subject: Trade/Economics, Security Assistance and Sales, Democratization [TEXT]
Companions on the Road to Peace
Remarks by President Bush and President Ozal, Istanbul, Turkey, July 22, 1991.
President Bush:
Mr. President, Mr. Speaker, Mr. Prime Minister, and ladies and gentlemen. Barbara and I just want to simply thank you for our visit and for the warmth of this Turkish hospitality. We are very grateful. A Turkish proverb reminds us, "A long journey is shortened by good companions." Well, our stay here has been brief, but our companions have been splendid. And the proverb applies equally to the quest for peace and prosperity. Its road is arduous. But good companions shorten it, as President Ozal and Prime Minister Yilmaz have proved over these past 2 days. Mr. President, real peace means the triumph of a better life, not merely the absence of war. This goal requires stout hearts and open minds and will provide a fitting object for our new strategic relationship. Turkish-American ties date back more than 200 years. But our goal must be more extensive political ties, deeper security ties, broader economic ties, and more enduring commercial ties. I leave Turkey knowing that our ties are as strong as they have ever been and that they can and will grow even closer. Toward that end, President Ozal and I talked of how to broaden cooperation between our people in fields such as education, the environment, science, technology. We discussed Turkey's commitment to democracy and the free market, and how increased trade and investment can enhance our relationship as allies and friends. We pledged to expand the military cooperation that helped liberate Kuwait. Our Administration supports Turkey's priority objective of military force modernization, including its 160-plane F-16 development program. We stand side-by-side in maintaining an international force to preserve stability on your southeastern frontier. And in that spirit, I'm pleased to announce that the United States will provide $1 million to Turkish villages along the Iraqi border that suffered economic losses during the refugee crisis. And we will remain engaged with you, our Greek allies, the Cypriot people, and the UN Secretary General in hopes of building a lasting peace in Cyprus. If a wall in Berlin can fall to human brotherhood, so can ancient hatreds on Cyprus. I began with a Turkish proverb, so let me close with another one: "The bird with one wing cannot fly." Mr. President, you're a dear friend and colleague. And you know, as I do, that our strategic relationship has two wings--one extending from Maine to Alaska and the other spanning your vast historic land. Together, let us fly toward a better future. So once again, my friend, thank you for this welcome, for the kindness that you and the Turkish people have shown over the past few days. May God bless Turkey and the United States of America.
President Ozal:
Mr. President, Mrs. Bush, ladies and gentlemen. We are coming to the end of the President Bush visit to Turkey. This visit has fulfilled all our expectations. During this visit we have not only confirmed how strong the foundations of Turkish-American relations are, but we have also been able to take new steps for a more comprehensive and deeper relationship, encompassing political security, economic, and social fields. The fact that the second phase of the F-16 project has been agreed upon with a production target of 160 aircraft, that a steering group has been established to conduct intensive political consultation on all key issues of common interest and to monitor other aspects of our relationship are some of the concrete steps demonstrating the political will and determination of our two countries to forge ever-closer relations. This visit has also provided us with the opportunity of exchanging views on all the major issues concerning our two countries and confirming the identity of views among us. But alongside all these important issues, it gave all of us, Mr. President and Mrs. Bush, the opportunity to get to know you even better, to consolidate our friendship and to appreciate once again how lucky the world, whole world is in having such a great leader like you as the President of the United States at a time when such important developments are taking place in our globe that will affect all generations to come. I'm asking you, Mr. President and Mrs. Bush, to convey the greetings and best wishes of the Turkish people to the American people. As we say good-by, we are all proud of the level the Turkish-American partnership has reached through our mutual efforts. Thank you. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

ASEAN Post-Ministerial Conference

Baker Source: Secretary Baker Description: Statement at a meeting [July 22-24] with the foreign ministers of the six countries of the Association of South East Asian Nations Date: Jul 24, 19917/24/91 Category: Speeches, Testimony, Statements Region: Southeast Asia Country: Brunei, Indonesia, Malaysia, Singapore, Philippines, Thailand, Vietnam, Cambodia, Laos Subject: Trade/Economics, International Organizations [TEXT] I am very pleased to have this opportunity to meet once again with you, my ASEAN colleagues. Last year at the Post-Ministerial Conference in Jakarta, our discussions included a wide range of topics, including an issue of central importance to the region: Cambodia. Again this year, it is appropriate that Cambodia is on our agenda. [Indonesian] Foreign Minister Alatas has done a remarkable job of keeping negotiations on track toward a comprehensive settlement, building on the work of the Paris International Conference on Cambodia and on the Perm Five [five permanent members of the UN Security Council] proposals. Thailand, too, deserves thanks for hosting the meeting at Pattaya which appears to have broken new--and, we hope, fertile--ground. The United States is encouraged at the signs of progress and recommits itself to remaining engaged in this long and sometimes arduous process. Like you, we recognize the importance of our final goal--affording the Cambodian people the opportunity to chose their own government by means of free and fair elections under UN supervision. We must not accept partial solutions. We need a comprehensive settlement to ensure an enduring peace. The United States draws much of its strength from a pluralistic political system which offers people with contrasting views an opportunity to express themselves and to influence policy. We do not insist that our system is the only appropriate political order, but we do believe that democratic pluralism helps make societies resilient, dynamic, and responsive to popular aspirations. Thus we applaud trends toward political openness in Southeast Asia, and we view with dismay the situation in Burma, where a self-appointed military leadership regularly violates basic human rights and has blatantly ignored the people's voice as clearly expressed in popular elections. We regret that a country with such great potential for economic advancement and cultural achievement has shut itself off from the society of nations by its political brutality and economic disintegration. Within ASEAN, economic development has been rapid and exciting, greatly expanding opportunities for both foreign and domestic businesses to trade and invest. In fact, the region's dramatic economic growth is closely linked to the signs of political opening I mentioned a few moments ago. When people gain economic freedom, they hunger as well for increased political freedom. The formation of APEC [Asia-Pacific Economic Cooperation] 20 months ago was another signal of the vitality of the Asia- Pacific region, stimulated by the vast economic flows linking our economies. It is vital for the APEC countries as a group to work together for our mutual goal of freer trade worldwide and particularly for a successful conclusion of the Uruguay Round [of the General Agreement on Tariffs and Trade]. We are encouraged by the vigor with which APEC's working groups have begun their activities, and we will continue to work cooperatively and energetically with you to make APEC succeed. The United States has relationships of long standing with the nations of Southeast Asia, individually and collectively, in the economic, political, and security realms. We are committed to these relationships. Our participation in the ASEAN Post- Ministerial Conference is one manifestation of that commitment. I look forward to this opportunity to discuss important issues of mutual interest. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

Association of South East Asian Nations (ASEAN)

Date: Aug 5, 19918/5/91 Category: Fact Sheets Region: Southeast Asia Country: Brunei, Indonesia, Malaysia, Singapore, Philippines, Thailand, Vietnam, Cambodia, Laos Subject: Democratization, Refugees, Trade/Economics [TEXT]
Background
Secretary Baker met in Kuala Lumpur, Malaysia, July 22-24, with the foreign ministers of the six ASEAN countries (Brunei, Indonesia, Malaysia, Philippines, Singapore, and Thailand). This was the 13th annual "post-ministerial" consultation with ASEAN at the foreign minister level, which immediately followed the annual meeting of the six ASEAN foreign ministers. The ministers also invited their counterparts from Australia, Canada, the European Community, Japan, New Zealand, and South Korea to the post-ministerial consultation to discuss major world and regional issues. The six ASEAN nations have a total population of more than 300 million people. Covering more than 3 million square kilometers (1.2 million square miles), the ASEAN countries straddle strategic sea routes linking the Pacific Ocean with the Middle East, Africa, and Europe. Rich in natural resources, with a talented and hard-working population and market-oriented development policies, the ASEAN countries grew more rapidly than most developing nations during the 1980s. Their trade with the rest of the world slipped to $144 billion in 1985 because of slackening world trade and falling commodity prices but rebounded quickly and by 1990 reached $295 billion. Two-way trade with the US totaled $46 billion in 1990, making ASEAN our fifth most important trading partner.
What Is ASEAN?
The Association of South East Asian Nations was created in August 1967 with the signing of the Bangkok Declaration by the five original member nations (Brunei Darussalam became the sixth member on January 7, 1984, shortly after its independence). ASEAN's major purposes are to strengthen regional cohesion and self-reliance, emphasizing economic, social, and cultural cooperation. It evolved slowly because of the member countries' varied historical and colonial heritages and because their economies largely compete against each other. Cooperation increased after the US withdrawal from Vietnam in 1975. The first two ASEAN summit conferences of heads of state, held in 1976 and 1977, initiated much closer collaboration in political as well as economic and social matters. The third ASEAN summit was held in Manila in December 1987. ASEAN has a loosely organized structure of ministerial meetings, committees, and a small secretariat located in Jakarta. The six nations have not been ready to give a regional secretariat more centralized authority, nor has there been rapid movement toward regional economic integration.
Economic Growth
ASEAN countries averaged annual real gross domestic product growth of more than 5% during 1978-90, one of the economic success stories among developing countries. The average slipped to 0.6% in 1985 but rose again to 7% in 1990. Future prospects for the ASEAN economies, which are generally among the better managed in the developing world, remain bright.
Regional Cooperation on Cambodia
Since the Vietnamese invasion of Cambodia in 1978, the ASEAN countries have collaborated effectively in working for a comprehensive settlement that would include: 1) verified withdrawal of Vietnamese forces, 2) measures to prevent the return to power of the Khmer Rouge, and 3) genuine self- determination for the Cambodian people through free and fair elections.
External Relations
ASEAN has strengthened its ties with the US and other industrialized countries through periodic economic "dialogues" and the post-ministerial consultations. The ASEAN governments take a constructive, creative approach to important world issues in the United Nations and other forums.
Private Sector Cooperation
The ASEAN governments support private sector entrepreneurial growth, domestic and foreign investment, and an open world trading system. In 1979, the ASEAN Chambers of Commerce joined with the US Chamber of Commerce to form the ASEAN-US Business Council to represent private sector concerns. The council supports the US- ASEAN Center for Technology Exchange, formed in 1984 to promote the exchange of business know-how and investment.
Regional Trade and Economic Cooperation
The ASEAN members agreed at their third summit to accelerate efforts to reduce tariffs on intra-ASEAN trade to promote industrial development. ASEAN also is trying to foster cooperative industrial investment projects with government or private sector involvement.
Refugees
Since 1975, more than 2 million people left Cambodia, Laos, and Vietnam for "first asylum" (temporary refuge) in neighboring ASEAN countries. More than 1.6 million of those refugees have been resettled elsewhere. Concerned about the continuation of this exodus, the ASEAN countries called for an international conference, which was held in Geneva in June 1989. The conference resulted in the Comprehensive Plan of Action (CPA) which consisted of an interlocking set of policies designed to resolve the problem while preserving first asylum. The CPA has resulted in a significant decrease in the outflow from Vietnam. Furthermore, nearly 9,000 Vietnamese from refugee camps in the region have voluntarily repatriated to Vietnam. The Steering Committee of the CPA has met four times since the agreement was reached. Despite some concerns about the speed with which the problem is being handled, each meeting reaffirmed agreement on the CPA and the practice of first asylum. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

Asia-Pacific Economic Cooperation (APEC)

Date: Aug 5, 19918/5/91 Category: Fact Sheets Region: Southeast Asia, Pacific, East Asia Country: Australia, New Zealand, Canada, USSR (former), Japan, Brunei, Indonesia, Malaysia, Thailand, Singapore, Philippines, South Korea Subject: Trade/Economics [TEXT]
Background
Economic relations among countries of the Asia-Pacific region have increased dramatically over the last decade. In the clearest example, US trans-Pacific trade equaled trans-Atlantic trade in 1980. By 1989, US trade across the Pacific ($304 billion) was 37% greater than trade across the Atlantic. APEC was established because there were inadequate mechanisms to deal with the effects of growing interdependence within the Pacific region. A new mechanism for multilateral cooperation among the market-oriented economies of the region was clearly needed. APEC is an informal grouping of 12 Asia- Pacific countries formed to meet that need.1 It provides a forum for ministerial discussion on a broad range of economic issues of importance to the region. APEC ministers first met in Canberra, Australia, in November 1989. The second APEC ministerial took place in Singapore in July 1990. Annual ministerials are planned in Seoul in November 1991, Bangkok in 1992, and the US in 1993. Between ministerial meetings, a group of senior officials (deputy assistant secretary level for the United States) meet to guide the work of APEC and oversee its work program. APEC relies on regular meetings of senior officials and the government hosting the next ministerial to oversee the work program and provide secretariat services. China, Taiwan, and Hong Kong have expressed interest in joining APEC. The United States fully supports the APEC Ministers' agreement at their Singapore meeting that consultations should continue with all three on arrangements for their participation, and, at the same time, on terms agreeable to all three and to current APEC members. South Korea, as the host of the next APEC ministerial, is pursuing these consultations.
APEC Progress
APEC has made remarkable progress since November 1989. Its top priority is a successful conclusion of the Uruguay Round (of the General Agreement on Tariffs and Trade), and, to this end, APEC held a special trade ministers meeting in late 1990. Its senior officials have created 10 working groups, covering broad areas of economic, educational, and environmental cooperation. Data. Develops consistent and reliable data in merchandise trade, trade in services, and investment. Trade Promotion. Develops proposals to exchange trade and industrial information and to promote economic and trade missions among countries of the region. Organizes international seminars and meetings to promote trade, an Asia-Pacific trade fair, and a training course on trade promotion. Expansion of Investment and Technology Transfer. Establishes an investment and technology information network for the Asia- Pacific region. Disseminate information on the development and management of "techno-parks." Human Resources Development. Seeks ways to exchange information among Asia-Pacific countries in such areas as business administration, industrial training and innovation, project management, and development planning. In this working group, the US is encouraging the APEC Partnership for Education which will promote cooperation among educational institutions, private sector internships, and US Government-sponsored private sector training programs. Regional Energy Cooperation. Develops cooperative projects, such as a regional database on energy supply and demand, and exchanges views on, among other things, coal utilization and technology; energy conservation and efficiency; research, development, and technology transfer; and resource exploration and development. Marine Resource Conservation. Examines the extent of the marine pollution problem and develops recommendations for APEC ministers concerning accession by its countries to international legal conventions. Exchanges information on technical and policy aspects of marine pollution, advancement of integrated coastal zone planning, progress on collection of data on damage to shipping by marine debris, and ways to combat pollution by non-hydrocarbons. Telecommunications. Compiles APEC telecommunications development activities, including a description of each member country's telecommunications environment, to be updated annually. Develops a manual/guideline on how to approach training in a telecommunications organization, followed by a pilot project reviewing needs and recommending approaches to solving them in a selected organization. Explores ways to establish and develop regional networks, initially in the areas of electronic customs data interchange and teleports. Transportation. Studies ways to improve infrastructure, to facilitate movement of passengers and freight, to collect and exchange data, and to enhance transportation safety and security. This US-led working group is one of three added in March 1991. The US proposed it because of the central importance of improved transportation links to continued economic growth in the region. Tourism. Studies tourism data exchange, barriers to expansion, training programs, and current projects in APEC countries. Because tourism is of extraordinary importance to the economies of the Asia-Pacific region, this working group was added in March 1991. Fisheries. Also added in March, surveys the pattern of APEC fisheries cooperation to develop fisheries resources. Reports on role of APEC in coordinating and complementing the work of existing organizations and promoting cooperative relations among APEC participants.(###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

US Economic Relations With East Asia and the Pacific

Date: Aug 5, 19918/5/91 Category: Policy Briefs (Gist) Region: East Asia, Southeast Asia Country: Japan, China, Taiwan, Singapore, Hong Kong, South Korea, Thailand, Malaysia, Philippines, Vietnam, Laos Subject: Trade/Economics [TEXT]
Background
The East Asian and Pacific region remains the world's most economically dynamic area, despite the recent worldwide economic downturn. Japan has become the second largest market economy and the second largest donor of development assistance. The region's newly industrialized economies (NIEs)--Hong Kong, Singapore, South Korea, and Taiwan--have consistently maintained high economic growth rates over the last two decades. In the process, they have achieved "middle-income" levels of per capita GNP and have become major participants in international trade. Thailand and Malaysia are fast approaching development levels close to those of the NIEs. The East Asian and Pacific region recently has surpassed Western Europe to become the largest regional trading partner of the United States, both as a supplier of US imports and as a customer for its exports. In 1990, US two-way trade with the region was about $300 billion, about 34% of US global trade. American direct investment in the region was $55 billion in 1989, accounting for 15% of total US overseas investment and providing 18% of its foreign investment income.
US Support for Economic Reforms
The achievements of the successful Asian economies can be attributed largely to market-oriented, outward-looking strategies of growth, together with the high value these societies have traditionally placed on education, discipline, and hard work. The United States contributes to this success and supports appropriate economic reforms by providing: -- The principal market for the region's exports; -- Leadership in promoting an open international trade and financial system; -- Economic assistance to the region's developing nations; and -- A military security umbrella. The Philippines and Indonesia have economic reforms underway that, if sustained, will enable them to capitalize on their impressive potential. Australia and New Zealand also are engaged in difficult economic restructuring and trade liberalization efforts. Some Pacific island mini-countries are not yet fully participating in the region's economic success. Implementation of market- oriented reforms has boosted the economies of Laos and, to a lesser extent, Vietnam, but both countries remain poor. China experienced rapid economic growth during most of the 1980s as it moved toward a more market-oriented system. Beginning in September 1988, however, China embarked on a policy of retrenchment that has slowed economic growth and expanded government control over the economy.
Trade Success and Imbalances
The dramatic success of East Asian and Pacific exports in the US market has led to large, unsustainable trade imbalances. In 1990, East Asian and Pacific economies accounted for about 74% of the total US trade deficit of $102 billion. The United States had trade deficits with Japan ($41 billion), Taiwan ($11 billion), China ($10 billion), and South Korea ($4 billion). On the other hand, the United States had a $4 billion trade surplus with Australia in 1990. Congress and US business have intensified the pressure to reduce imports from and increase US exports to East Asian and Pacific economies. Some progress in reducing these trade imbalances already is evident. Japan has made progress in opening its markets to foreign goods and services as its economy changes from export-led to domestic demand-led growth. The NIEs, particularly South Korea and Taiwan, also have had some success in reducing import barriers. This has helped reduce the overall US trade deficit with the East Asian and Pacific region from $107 billion in 1987 to about $74 billion in 1990. East Asian and Pacific countries have come to recognize that their growth and export successes require them to bear a much larger burden for the health of the world economy. Consequently, they are undertaking appropriate adjustments to help correct international imbalances by: -- Ensuring realistic exchange rates; -- Lowering barriers to imported goods, services, and investment; and -- Adopting macroeconomic and structural policies that encourage growth through increased domestic demand as well as exports. The United States, in turn, must maintain its efforts to reduce domestic fiscal imbalances and to keep its import markets open.
Increasing Regional Cooperation
The United States has been working with East Asian and Pacific economies for several years to strengthen regional economic cooperation. US officials have had extensive consultation with the Association of South East Asian Nations (ASEAN), the Asian Development Bank, the UN Economic and Social Commission for Asia and the Pacific, the South Pacific Council, the South Pacific Forum, and the Pacific Economic Cooperation Conference. Many of the region's leaders recently have called for more intensive consultation among the market-oriented economies of the East Asian and Pacific region on macroeconomic policies, structural reform, and the health of the world trading system, particularly the current Uruguay Round of the General Agreement on Tariffs and Trade (GATT). Secretary Baker played a key role in the formation of APEC (Asia Pacific Economic Cooperation), a regional forum based on those principles. The United States works actively with its East Asian and Pacific partners to promote APEC as a new vehicle for regional economic cooperation. At the invitation of Australian Prime Minister Bob Hawke, the first APEC ministerial conference convened in Canberra in November 1989. A second ministerial meeting took place in Singapore in July 1990, leading to the creation of work projects in various areas of interest to the 12 APEC members. The next APEC ministerial will be held in Seoul later this year. The United States will host the 1993 ministerial meeting. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

US-Japan Trade

Date: Aug 5, 19918/5/91 Category: Policy Briefs (Gist) Region: East Asia Country: Japan Subject: Trade/Economics [TEXT]
Background
The United States and Japan are the world's two largest economies, with a combined gross national product (GNP) estimated at $8.5 trillion in 1990, almost 40% of world GNP. Japan is the United States' second largest market after Canada, and its best agricultural customer. About 58% of US exports to Japan are manufactured goods. In 1990, US exports to Japan were almost $49 billion, a 9% increase from 1989, while imports from Japan were $90 billion. In 1990, the $41-billion US trade deficit with Japan (40% of the total US deficit) was 16% less than in 1989. The United States is Japan's largest market. Japanese exports to the United States consist primarily of vehicles (33% of the total), non-electric machinery (24%), and electronic products (22%). Japan's global current account surplus declined from $57 billion in 1989 to $36 billion in 1990. Macroeconomic factors, such as different rates of savings and investment as a percentage of GNP, are cited most often as the cause for the external imbalances of the United States and Japan. Nevertheless, US trade officials are working closely with the Japanese Government to remove market and microeconomic impediments, many of them cultural and structural, which restrict access to the Japanese market. Concern about Japan's competitive challenge and its industrial policies has focused US public attention on the issues of high-technology trade, "economic security," and competitiveness. US calls for managed trade have increased.
Structural Factors
Several official and semi-official Japanese studies, most notably the "Maekawa Report," have recommended that Japan make structural changes in its economy to reflect its more advanced level of economic development. The studies indicate that growth no longer should depend on exports but more on domestic demand. In fact, domestic demand in Japan during 1985-90 grew faster than external demand. The Japanese Government also is responding to domestic and foreign requests for deregulation of a highly restrictive economy. The Japanese consumer, who faces high prices for local consumer goods, has become more active in calling for changes in the Japanese economy. To address the root causes of the bilateral payments imbalances, the United States and Japan launched the Structural Impediments Initiative in September 1989. In a June 1990 report, each country committed itself to structural reforms. In Japan, these included reforms in the distribution system, exclusionary business practices, keiretsu (interlocking business groups), land use policies, and savings/investment patterns. In turn, the Japanese urged the United States to improve its savings and investment rates, export promotion, work force training and education, research and development, corporate behavior, and investment activities. The two sides will report annually during the next 3 years on progress in implementing these commitments.
Market Access
Almost all of the expansion in US-Japan trade in recent years can be attributed to growth in US exports to Japan. This growth (9% in 1990) continues to outpace the increase in US exports to the rest of the world (8%). Since 1987, the peak year of the bilateral deficit, US exports to Japan have grown by 72%, from $28 billion to almost $49 billion, while exports to the rest of the world increased by 54%. The Japanese market for US goods and services is twice that of the United Kingdom and 2.5 times that of Germany. In 1988, the United States signed agreements with Japan to liberalize Japan's market for beef, citrus, other agricultural products, and public works contracts. In April 1990, the two countries successfully reached agreements on the three sectors identified for trade liberalization under the Super 301 provision of the Omnibus Trade and Competitiveness Act of 1988: satellites, supercomputers, and wood products. During 1990-91, agreements were reached on amorphous metals, semiconductors, and major projects. Efforts to improve access to the Japanese market continue in semiannual meetings of the Trade Committee and meetings related to the market-oriented-sector-selective (MOSS) process. Talks with the Japanese Government continue in medical equipment/pharmaceuticals, auto parts, agricultural products, construction, telecommunications, semiconductors, electronics, intellectual property rights, and services.
US POLICY
US trade policy with Japan has several elements, including: Negotiations and other market access initiatives that focus on removing barriers to trade in specific Japanese markets; Encouragement of structural changes that will open Japan's economy and further increase imports; Coordination of policies to align bilateral economic trends to foster improved economic balances; and Close coordination with Japan in multilateral trade forums, particularly the Uruguay Round. The two countries have worked effectively to move negotiations forward in the round and, with a few exceptions such as agriculture, are closely allied on substantive positions.(###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

Mongolia's Choice for Freedom

Baker Source: Secretary Baker Description: Remarks before a joint meeting of the Mongolian parliament, Ulaanbaatar, Mongolia Date: Jul 26, 19917/26/91 Category: Speeches, Testimony, Statements Region: East Asia Country: Mongolia Subject: Development/Relief Aid, Trade/Economics, Democratization Thank you, Mr. Vice President. ladies and gentlemen. Today, I come to speak to you as an American, a Texan, and an outdoorsman. As an American, I believe in democracy and free markets. And so on behalf of President Bush and the American people, I come here today to lend our support and to work with you for the success of political and economic freedom here in Mongolia. As a Texan, I believe in the strength that comes from life on the frontier. And so I come to your land, twice the size of my home state and one of the world's last frontiers, to support the Mongolian people's hard work for freedom and to say to you [that] there can be no turning back on freedom's road. As an outdoorsman, I believe in the wonder of nature. And so I come to your breath-taking country to marvel at the gifts God has given it and to take back to the American people tales of its splendor and beauty. And, above all, I come here today to finish the visit we began together a year ago, a visit the warm hospitality of which my delegation and I will never forget, a visit that I am privileged in a sense to continue by addressing this distinguished body today. When last I was honored to be here in Ulaanbaatar, it was to join in the high-spirited festivities celebrating your historic elections. This people, seemingly so cut off from the peaceful democratic revolutions of 1989, had just chosen to join those revolutions and build democracy. This nation, seemingly so remote from the world, had just chosen to join the growing community of free nations. But, in stark contrast to your courageous choice, Iraq's brutal decision to invade Kuwait--a throwback to dictatorship and aggression--cut short our mutual celebration of Mongolia's new- found freedom. Neither the President, nor the American people nor I, will forget how quickly and strongly Mongolia condemned Iraq's brutality and worked with the international community to end Saddam Hussein's aggression. A year has passed. That international community has defeated Iraq's aggression. Democracy remains ascendant across the globe. And many more nations with diverse histories and cultures-- Albania being the latest--have joined Mongolia on the path of free elections, free markets, and democratic institutions. For over a year now, the Mongolian people have been engaged in what President Bush calls the "hard work of freedom." And, despite setbacks, hardships, and shortages, your hard work has begun to show results. You have advanced by fostering a spirit of cooperation and political pluralism, and you have made great strides toward establishing the rule of law here in Mongolia. All Americans appreciate especially your keen interest in our Constitution, our Bill of Rights, and in the workings of our representative government. And we hope you, too, will create democratic institutions that will live decades and centuries into the future. For all of this, you have acquired great merit in the eyes of all those who wish to see democracy prosper throughout the world. But we, the friends of democracy, must speak under no illusions. In Central America and Africa and throughout Central and Eastern Europe, free peoples are discovering that their first bold and brave steps toward freedom may well have been the easiest. Each in their own way, nations the world over who have embarked upon the path of democracy must wrestle with its daunting challenges--the vigorous give and take of debate, the checks and balances among branches of government, the push and pull of market forces, the need to protect the rights of individual citizens while governing for the common good. Indeed, to some the democratic process appears to be a prescription for anarchy and chaos. Yet, it is not. It is instead a classic case of opposing forces, of Yin and Yang in constant creative tension. Its vitality lies in contesting forces held in harmony by the common embrace of shared values--values such as respect for human rights, freedom of choice, tolerance, openness, and cooperation. With these all-embracing values as your guide, I am certain that you will find the way ahead. We know that you face tremendous economic challenges. We know that the legacy of decades of dependency and the folly of central planning may frustrate your efforts for some time to come. I can only urge you to stay the course. However daunting the obstacles you face may seem, retreat to the ways of the past can only make the move more difficult. We are confident that your efforts to instill the discipline of the market and to open trade and investment ties with market economies in Asia and the West ultimately will be rewarded. Your perseverance will help lay the foundation for a prosperous new century, and we will do what we can to help you persevere and succeed. We cannot take the arduous steps forward for you. Only the people of Mongolia can do that. And those of you here today--the people's representatives--can play a special role. You must have the courage to lead your people by continuing your moves to free markets. But we, and other nations who cherish democracy, can help you along that path. In response to a request from President Ochirbat, President Bush is providing 30,000 tons of wheat and flour in emergency food aid, totaling some $9 million. That's 30 lbs. for every Mongolian man, woman, and child. And just last week, our first planeload of medical equipment, some 60,000 lbs. arrived here in Ulaanbaatar. To help Mongolia initiate its privatization efforts and bolster reform, we are providing $2.4 million in technical assistance this year, with $4 million to follow next year. To help you overcome your present economic difficulties, I have also asked the US Congress to approve an additional $10 million in aid from our Economic Support Fund. Provided our Congress approves these funds, we will try to make them available as soon as possible to help meet some of your critical needs. In addition, we are engaging in a trade and development study on how to help Mongolia modernize its coal-fired electric power plants and develop its petroleum industry. And we have signed an Overseas Private Investment Corporation (OPIC) agreement with your government. This will help us to mobilize the American private sector to invest in Mongolia. I am also pleased to say that the first of our Peace Corps volunteers are now in Ulaanbaatar receiving language training at your Pioneer Palace. They will be teaching English and computer science as they begin to implement the agreement I signed here last August. These people-to-people contacts will enrich Mongolians and Americans alike. But America's support for democracy and market reform in Mongolia goes beyond what we alone can provide. We are actively working to mobilize the international community to support your efforts with the international financial institutions--World Bank, the IMF, the Asian Development Bank--we are attempting to develop aid programs to meet Mongolia's needs. Most importantly, we are working closely with Japan, Korea, and other countries to encourage support for Mongolia. We hope that within the next 2 months a number of countries will meet to organize and expand international bilateral support for Mongolia. In all of these ways, the United States and other like-minded nations are making every effort to ensure that your transitions to democracy and free enterprise succeed, for we all recognize that your success will strengthen our worldwide community of free nations. In closing, let me be so bold as to talk to you a bit about your own history. Some seven centuries ago, in the days of conquest under the rule of the great Khans, Mongolia stood at the crossroads of trade and ideas, of power and nations on the vast Eurasian continent. Then, at the mid-point of this century, Mongolia stood as a Stalinist outpost on the road between Moscow and Beijing. Now today, in a vastly different sense, Mongolia has placed itself at the crossroads of a new order for Asia and the world--an order based on democratic values and free markets. You were the first country in Asia to embrace communism. Now, you are the first communist country in Asia to choose democracy. And to your choice, I say this: Mongolia can show others the way ahead. By your example, Mongolians can show the world that freedom works, that a free market works, that international cooperation works. Showing the world that democracy and free markets can work in Mongolia will not be easy. It will be painful. And it will take time. But, in your work, you will not be alone. For we will work with you, as here on the frontier of freedom, you build a better future for the Mongolian people. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

US Economic Sanctions on Burma

Boucher Source: State Department Deputy Spokesman Richard Boucher Description: Washington, DC Date: Jul 22, 19917/22/91 Category: Speeches, Testimony, Statements Region: Southeast Asia Country: Burma Subject: Trade/Economics, Human Rights, Democratization, International Law . . . Section 138 of the Customs and Trade Act of 1990 (the Moynihan amendment) calls on the President to impose appropriate economic sanctions on Burma if the President could not certify that Burma has taken certain political reforms and improved its performance on narcotics suppression. Burma cannot meet these requirements, and we have so informed Congress. The Administration has decided to implement the sanctions legislation by declining to renew the Bilateral Textile Agreement with Burma, which lapsed December 31, 1990. The agreement, which Burma has asked several times to renew, was the foundation for that country's largest single category of exports to the United States. In 1990, textiles accounted for just over $9 million of the total Burmese exports to the United States of $22 million. In just the first 5 months of 1991, Burma's textile exports to the United States have decreased by 26% in volume and 21% in value compared with the same period in 1990. I would note that the United States has already taken several economic measures against Burma in an effort to improve the situation in that country. -- We have long since terminated all forms of non- humanitarian assistance to Burma and actively urge others to do so. -- We have suspended Burma's GSP [generalized system of preferences] benefits. -- We have decertified Burma on narcotics. This requires us to oppose loans to Burma by the World Bank, the IMF [International Monetary Fund], and other international financial institutions. -- We have blocked the sale of arms to Burma from the United States and have attempted to dissuade others from selling arms to Burma. The EC [European Community] also has recently imposed an arms embargo on Burma. -- We have consulted with other industrial democracies to search for further methods to increase pressure on the Burmese regime. Summit countries have expressed a desire to see a return to full democracy. As noted in Under Secretary [Counselor and Under Secretary for Economic and Agricultural Affairs Robert B.] Zoellick's opening statement at the ASEAN [Association of South East Asian Nations] post-ministerial meeting, we expect to direct further collective attention toward Burma. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

Diplomatic Efforts To Resolve the POW/MIA Issue in the Past Year

Kimmitt Source: Robert M. Kimmitt, Under Secretary of State for Political Affairs Description: Remarks before the National League of Families, Washington, DC Date: Jul 12, 19917/12/91 Category: Speeches, Testimony, Statements Region: Southeast Asia Country: Vietnam, Cambodia, Laos Subject: POW/MIA Issues [TEXT] Chairman Scott, Members of the Board of Directors, Ann Griffiths, and all other family members who are here today, I welcome the opportunity to speak to you again as I did at last year's annual meeting. Last year I spoke to you of my deep, personal commitment to the effort of resolving the fate of Americans who served in Vietnam who are still missing and unaccounted for. That commitment stems from the tour of military service that was just described and remains as strong as ever. Secretary Baker, on whose behalf I appear today, shares that sense of moral obligation and has made it an integral part of our foreign policy toward Indochina. Quite a bit has happened since we last met. So today, I would like to describe briefly the Administration's diplomatic efforts to obtain as many answers as humanly possible, particularly as to whether Americans may still be alive and in captivity after these many years. I want to reassure you, the families, veterans, and other concerned citizens that we are doing everything within our power to get to the bottom of this issue. We know that your support is essential if we are to move toward a new relationship with the countries of Indochina. We also know that your support will not be fully forthcoming until we can assure you that we have obtained all the answers that are readily available and have established a viable mechanism for following up any new leads that may subsequently come to light.
Recent Diplomatic Efforts With Vietnam
It was almost a year ago that Secretary Baker announced that we would broaden our dialogue with Vietnam to include discussions on Cambodia. Following that announcement, we met twice in August 1990 with Vietnam's Permanent Representative to the United Nations to discuss Cambodia and POW/MIAs [prisoners of war/missing in action]. The following month we took advantage of the presence of senior Vietnamese officials in New York for the UN General Assembly to arrange a meeting with Vice Foreign Minister Le Mai, followed by a meeting between Secretary Baker and Foreign Minister Thach. Having been closely involved in those discussions, I can tell you that at each opportunity we reminded the Vietnamese of our long-standing policy that, while a comprehensive settlement for Cambodia will initiate the process of normalization, the pace and scope of that process will be directly affected by the seriousness of Vietnam's cooperation on POW/MIA and other humanitarian concerns of importance to the United States. This was underscored by the Secretary's invitation to Minister Thach to visit Washington, the first ever for a foreign minister from Hanoi, to work out specific steps to expedite the accounting for missing Americans. At that meeting in October, General Vessey and members of the POW/MIA interagency group proposed concrete steps to obtain more rapid results and to establish an ongoing program to achieve the fullest possible accounting of American POW/MIAs. These steps were: first, sending a US technical team to Hanoi to plan improved joint investigations; second, forming a joint team of analysts to search for historical documentation on POW/MIA incidents; and third, increased efforts by Vietnam to recover and return the remains of US personnel. The Foreign Minister accepted all of our proposals, and afterward US and Vietnamese experts conducted the first two information-research sessions, as well as the 12th and 13th joint investigations in Vietnam. We thus made some progress but we wanted more--on POW/MIAs as well as Cambodia. In an effort to step up progress, in early April this year we gave Vietnam a road map to normalization. This road map was the product of intensive interagency discussions, including, of course, your Executive Director representing the families' vital interest in this process. In that road map we made clear the high economic costs to Vietnam of continued intransigence, and the great benefits of its cooperation on the issues, including POW/MIAs, that are important to us. We want to put the past to rest--not by sweeping it aside, but by resolving outstanding issues once and for all. We have heard complaints out of Hanoi that in the road map we are creating new conditions for normalization. To the contrary, however, it was precisely to avoid any misunderstanding that we set down for the Vietnamese in writing exactly what things we will do, and when we will do them, to build a more stable and productive relationship. Also in April, General Vessey and members of the interagency group traveled to Vietnam to advance the POW/MIA agenda. At the conclusion of this visit, General Vessey and Foreign Minister Thach reaffirmed the need for increased cooperation on POW/MIAs, and they announced their agreement to establish a US POW/MIA office in Hanoi on a temporary basis. The office will support information research, investigation of live-sighting reports, joint field activities, and forensic review and repatriation of remains made available by Vietnam. It will engage in POW/MIA matters only and will have no diplomatic or consular responsibilities. How long the office actually remains in operation depends on whether the Vietnamese give our people the freedom to carry out their mandate. Our bottom line, as always, is results.
Laos
Our efforts have also extended to Laos and Cambodia. Along with narcotics, the POW/MIA issue remains the top priority in our improving relationships with Laos, and our embassy in Vientiane regularly meets with Lao officials to discuss ways of improving POW/MIA cooperation. Last October, Secretary Baker met with Lao Foreign Minister Phoun at the UN, the highest-level bilateral meeting we have had since 1975. The Secretary said Lao POW/MIA cooperation had been critical to the improvement we have seen in bilateral relations, and he emphasized that continued cooperation would be necessary if relations were to improve further. He specifically mentioned our desire to proceed with joint investigations of discrepancy cases involving men known to have been held by the Pathet Lao as prisoners during the war. Foreign Minister Phoun pledged that the Lao would continue to cooperate on the POW/MIA issue and would fulfill their commitments. We are pleased that in 1991 we reached expanded POW/MIA agreements and have begun working in new areas of the country. We continually remind the Government of Laos of the importance we attach to the POW/MIA issue and the implementation of the work plan that Ann Mills Griffiths helped prepare.
Cambodia
Last year for the first time we sent a team to Cambodia, where 83 men are still unaccounted for, to review remains made available by the authorities there and repatriate any that could be those of Americans. Six were subsequently returned, but it appears doubtful that any of those are our missing. We have also discussed the issue through the channel we opened between our embassies in Vientiane. When Phnom Penh's deputy foreign minister announced last month that his regime would investigate live-sighting reports in the areas that it controls, we followed up again through our channel in Vientiane. We made clear that provision of any information that helps resolve the fate of Americans would be appreciated and viewed as a humanitarian gesture.
Conclusion
Now that Vietnam has its seventh Party Congress behind it, we look forward to Vietnamese actions that would allow us to move the relationship forward. Vietnam could make enormous strides in preparing the way for fast and full normalization by its complete cooperation on the POW/MIA issue. We will do all that we can to elicit that cooperation. This is an obligation that we in government owe to you, the families, and especially to the men we still love who have yet to return from Vietnam. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

POW/MIA Investigations

Tutwiler Source: Statement released by the Department of State Office of the Assistant Secretary/Spokesman Description: Washington, DC Date: Jul 29, 19917/29/91 Category: Speeches, Testimony, Statements Region: Southeast Asia Country: Cambodia, Vietnam, Laos Subject: POW/MIA Issues [TEXT] Deputy Assistant Secretary Quinn, accompanied by a POW/MIA specialist from the Defense Intelligence Agency, traveled to Hanoi and Vientiane on July 26 and 27 to request Vietnam, Laos, and Phnom Penh's urgent assistance in investigating photographs in which family members have identified their missing relatives. In his meetings, he conveyed the importance of this issue to the US Government, provided information available to us on the photos, and obtained pledges of cooperation and investigative actions. In Hanoi on July 26, he met with officials from various agencies, the most senior of whom was Vice Foreign Minister Le Mai. Although the Vietnamese officials restated their position that the Government of Vietnam holds no American POWs, in a humanitarian spirit and in acknowledgment of the compelling family identifications, the Vietnamese promised full cooperation. Specifically, they: -- Assured us that they are already publicizing the photo through print and television media; -- Agreed to an immediate search with US personnel of a prison west of Da Nang and the surrounding area where a report indicates the photo could have been taken; -- Agreed to further investigation of Colonel Robertson's case, including immediate excavation of his crash site; -- Provided additional information from war-time archives and recent witness statements on the Robertson case; -- Promised similar cooperation as soon as we deliver the photos in which family members have identified Lieutenant Borah and Captain Carr; -- Indicated strong interest in moving expeditiously on the remaining discrepancy cases that are the priority focus of our ongoing joint activities. In Vientiane, Quinn met with a number of senior Lao officials. They also promised full cooperation. The Lao Government said it would distribute the photo and instruct local officials to seek further information. It agreed to similar actions once it obtains the photos of Carr and Borah. Laos also agreed to provide unprecedented access to Lao officials who may have important POW/MIA information. In Vientiane, Quinn also met with the ambassador from Phnom Penh to propose that a US POW/MIA team go to Phnom Penh for further investigations. The authorities in Phnom Penh have since agreed, and a small team of American POW/MIA specialists should arrive there on July 31 for a stay of about a week or two. In all his meetings, Mr. Quinn emphasized the very great importance the US Government and the American people attach to the POW/MIA issue, particularly the possibility of live Americans missing from the Vietnam war. We will continue to press ahead vigorously in our efforts to resolve this issue. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

Vice President Quayle's Trip to Latin America

Date: Aug 9, 19918/9/91 Category: Fact Sheets Region: South America Country: Argentina, Brazil, Venezuela, Haiti Subject: Trade/Economics, Development/Relief Aid, Democratization, Nuclear Nonproliferation, Security Assistance and Sales [TEXT] Vice President Quayle visited Argentina, Brazil, Haiti, and Venezuela August 5-9. During his four-country trip, the Vice President encouraged trade and investment opportunities with the United States as well as among other countries of the hemisphere. He underscored US support for democracy and free markets and stressed the Bush Administration's view that free markets and democratic institutions lay the best foundations for protecting the region's fragile environment.
ARGENTINA
US-Argentina Relations. The primary US goal in Argentina is to strengthen democracy by encouraging political pluralism and economic reforms that will promote sustained growth and social stability. US policy toward Argentina aims to support the consolidation of democratic institutions, assure maximum cooperation between our countries, and resolve any differences in the spirit of mutual respect and understanding. US-Argentine relations are cordial and cooperative and involve daily official and private contacts at all governmental, business, social, and cultural levels. Based on a shared respect for democracy, ties have strengthened since the return of democratic government to Argentina in December 1983. President Menem's visits to the United States in September 1989 and October 1990 and President Bush's successful visit to Buenos Aires in December 1990 reflect this improvement in bilateral relations. Consolidation of Democracy. Argentina is in its eighth year of democratic civilian government. Peronist Carlos Menem, elected in 1989, formed a broad-based government and appointed many non- Peronists to top positions. In October 1989, he pardoned military officers accused of human rights violations during the 1976-83 period of military rule. Some leftist terrorists were also pardoned. The pardons, intended to promote national reconciliation, were criticized by human rights groups but appear to have been accepted by the population as a whole. President Menem also has announced his intention to pardon military junta leaders from this period who are presently in jail. The leaders of three army rebellions since April 1987 have been retired from the military. Economic and Debt Issues. In 1989, Argentina suffered perhaps its worst economic crisis of this century. Inflation for the year was almost 5,000%. Upon taking office, President Menem embarked on a bold economic reform program to halt hyperinflation, privatize inefficient state enterprises, open up the economy to greater trade and competition, encourage foreign investment, and reform the tax system. Although monthly inflation fell to single digits a few months after Menem took office, by the end of 1989 hyperinflation had returned and the value of the currency (the austral) had plunged. A comprehensive program of fiscal and monetary measures implemented in April 1991 has reduced inflation dramatically. The root cause of Argentina's chronic economic problems remains the government's fiscal deficit. Argentina is the third-largest debtor among developing countries, with more than $61 billion in external debt. One year ago, Argentina began to make small interest payments on its $31- billion debt to commercial banks. Interest arrears are currently about $8 billion. The Menem Government is reducing its debt burden by allowing debt-equity swaps in privatizations. Payments due on much of Argentina's non-bank debt were rescheduled in the Paris Club (official government creditors) in December 1989. Foreign Policy Issues. Under President Menem, Argentina has pursued a foreign policy designed to produce practical benefits for the country. Pursuit of closer economic integration with its neighbors--particularly Brazil, Uruguay, and Paraguay--and strong ties to the West, especially to the United States, are key elements of this policy. Brazil, Argentina, Paraguay, and Uruguay are currently negotiating a new Southern Cone Common Market (MERCOSUR). In June 1991, they and the United States signed the first regional trade and investment framework agreement under the Enterprise for the Americas Initiative. The positions of the Menem Government generally have coincided with US positions on major issues. Argentina's overtures to the United Kingdom led to resumption of diplomatic relations between the two countries in February 1990. (Relations had been broken in early 1982 during the war over the Falkland Islands, which are known in Argentina as the Islas Malvinas). Argentina had two ships participating in the multinational naval force in the Persian Gulf. Nuclear and Military Issues. Argentina has the most advanced nuclear-energy program in Latin America. Argentina signed the Treaty of Tlatelolco, a hemispheric non-proliferation accord, but has not yet ratified it. President Menem has renewed Argentina's commitment to the peaceful uses of nuclear energy. On November 28, Presidents Collor and Menem announced a common nuclear policy calling for a bilateral safeguards system and joint negotiations of a full-scope safeguards agreement with the International Atomic Energy Agency (IAEA). Negotiations with the IAEA have been under way since late winter. Both governments have said they will address Tlatelolco once safeguards are completed. On May 28, Minister of Defense Gonzalez publicly announced the termination of the Condor II missile program, creation of a new civilian space agency, and the Government of Argentina's willingness to adhere to Missile Technology Control Regime guidelines. Argentina at a Glance. About the size of the United States east of the Mississippi River, Argentina is the second-largest country in South America, after Brazil, and the eighth largest in the world. Its population of 32 million is 97% European, primarily descendants of Italian and Spanish immigrants. The Indian population, estimated at 50,000, is concentrated in the provinces of the north and northwest. Eighty percent of the population lives in urban areas, with about one-third of the total in the metropolitan area of the capital, Buenos Aires. Education is compulsory for 7 years; 94% of Argentines are literate. The country's topography ranges from subtropical lowlands in the north to the towering Andes mountains in the west and the bleak, windswept Patagonian steppe and Tierra del Fuego in the south. Argentina's heartland is the rich temperate plains, known as the pampas, in the east central part of the country. This is some of the finest farmland in the world, from which come large quantities of wheat, corn, sorghum, soybeans, and sunflower seeds. The pampas also provide year-round pasturage for Argentina's important cattle industry. Argentina is one of the largest exporters of foodstuffs in the world.
BRAZIL
US-Brazilian Relations. The United States was the first country to recognize Brazil's independence in 1822. During the 1950s and 1960s, Brazil received about $2.4 billion in US economic assistance. Due to Brazil's impressive economic development and its increased ability to obtain loans and technical assistance from private and multilateral sources, most US assistance programs were phased out during the 1970s. The United States is Brazil's most important commercial partner and largest investor. US-Brazilian relations are cordial and cooperative, and the two countries' shared respect for democracy and commitment to economic liberalization has strengthened ties since the return of democratic government in the mid-1980s. President Collor's successful pre-inauguration visit to the United States in January 1990 and his state visit to Washington in June 1991 as well as President Bush's visit to Brazil in December have contributed to an increased warmth in bilateral relations. Consolidation of Democracy. Major events in the transition to democracy include the return to civilian rule in 1985, promulgation of a new constitution in 1988, and the presidential election of 1989. More than 80 million voters went to the polls in November and December 1989 for elections that were both peaceful and free of irregularities. Congressional elections were held in October 1990 for all 503 seats in the Chamber of Deputies and one-third of the 81-member Senate. Many parties are represented in Congress, and party affiliations are highly fluid. Economic, Trade, and Debt Issues. When President Collor assumed office, inflation exceeded 80% per month. He introduced a sweeping program of economic adjustment and reform, beginning with an attack on inflation through a sharp freeze on liquidity. He also announced plans to privatize state enterprises, eliminate the fiscal deficit, and dramatically reduce government intervention in the economy and foreign trade. In response, inflation dropped sharply at first but reappeared by mid-1990. In early 1991, the government introduced a temporary wage-price freeze which is now being phased out. The government continues to work on detailed plans for the sale of state enterprises, reducing the federal work force, and new foreign trade regulations. Brazil enjoyed a foreign trade surplus of $11 billion in 1990 (down from $16.5 billion in 1989). The United States and other trading partners have objected to Brazilian import restrictions, including outright prohibition of imports, market reserves, and other non-tariff barriers. President Collor has made progress in eliminating these practices, and the United States has ended its trade actions under Section 301 of the Trade Act of 1988. Brazil, Argentina, Paraguay, and Uruguay are currently negotiating a new Southern Cone Common Market Agreement (MERCOSUR). In June 1991, the United States and the MERCOSUR countries signed a regional trade and investment framework agreement under the Enterprise for the Americas Initiative, with Presidents Bush and Collor in attendance. Brazil is the largest developing- country debtor, owing $112 billion to external creditors. It has remained current in payments to international financial organizations, although not to other governments (including the United States). The government entered a de facto moratorium on payments to foreign commercial banks in September 1989. It began partial debt service this year and recently agreed on a schedule to repay $8 billion of arrears to the banks. The government plans talks with the International Monetary Fund and debt-rescheduling negotiations with foreign commercial banks. Environmental Issues. International concern about the destruction of the Amazon rain forest was heightened by the December 1988 murder of environmentalist-labor leader Chico Mendes. In April 1989, the government began an environmental program called "Our Nature," designed to slow the destruction of the rain forest while seeking alternatives to develop the region. However, the government lacks the financial resources to implement this ambitious program. President Collor has shown a strong personal commitment to environmental protection. Burning of Amazon forests has decreased over the past year, partly as a result of his policy. Brazil will host the 1992 UN Conference on Environment and Development. Foreign Policy Issues. President Collor has signaled his interest in shifting Brazilian foreign policy toward the industrialized countries and away from the Third World focus that has characterized it in the past. He has made improvement of relations with the United States a high priority. The resolution of trade differences with the United States during the early weeks of his term has done much to remove earlier points of friction in that relationship. Nuclear Issues. The constitution prohibits non-peaceful uses of nuclear energy, but Brazil has an unsafe-guarded nuclear research and enrichment program. It is also committed to developing its own nuclear-powered submarine. Brazil has signed and ratified the Treaty of Tlatelolco, a hemispheric non- proliferation accord, but has not yet taken the final steps required to put the treaty into effect. Shortly after his inauguration, President Collor ordered a complete review of nuclear programs and policy. President Collor told the UN General Assembly in September 1990 that Brazil would not undertake any experiments involving nuclear explosions, even for peaceful purposes. In late November, he and President Menem of Argentina issued a Declaration of Common Nuclear Policy at Iguazu Falls calling for joint negotiation of a full-scope nuclear safeguards agreement with the International Atomic Energy Agency (IAEA) and for steps to bring the Treaty of Tlatelolco into force. Negotiations with the IAEA have been under way since late winter. Brazil has a national space program aimed at developing and launching its own satellites. Brazil at a Glance. With more than 150 million people, Brazil is the largest nation in Latin America and the fifth largest in the world. More than two-thirds of the population live in urban areas. Though 76% of Brazilians are functionally literate, only 20% of those who begin public school complete the primary grades. Per capita income exceeds $2,400 per year, putting Brazil in the ranks of middle-income developing countries. There are wide disparities in income distribution, with only 2% of national income going to the poorest 20% of the population and 65% going to the richest 20%. Brasilia is the capital. Forests cover approximately one-half of Brazil's interior, which includes a major share of the Amazon Basin and the largest tropical rain forest in the world. Largely self-sufficient in food, Brazil is the world's leading exporter of coffee and orange juice concentrate; the second-largest exporter of cocoa and soybeans; and a major exporter of sugar, meat, and cotton.
HAITI
US-Haitian Relations. US policy seeks constructive and cooperative relations with Haiti. It supports democracy, human rights, and the alleviation of poverty. Under the auspices of the Organization of American States (OAS) and the United Nations, and with US financial support for the electoral process and to help defray observer expenses, some 200 election observers from 22 countries witnessed the Haitian election and helped guarantee its fairness. President Bush appointed an official US delegation to observe the December 1990 presidential election in Haiti. The United States has responded to Haiti's movement toward democracy by increasing its economic assistance from $38.7 million in FY 1988 to an estimated $82 million in FY 1991. The figure projected for FY 1992 is $96.5 million. The US Agency for International Development has been active in Haiti since 1973, when US assistance programs were resumed after a 10-year absence. Among USAID's activities, designed to improve the well-being of the nation's poor, is a funding program to provide meals to 45% of all Haitian children of primary school age. The overall USAID program has three basic objectives: -- Natural Resources Management: Reducing and ultimately reversing the process of deforestation and soil erosion. Watershed management, coffee revitalization, and agroforestry are critical economic and environmental issues addressed by US programs. -- Private Sector Development: Providing a sound foundation for sustained growth in the private sector to increase opportunities for employment and income generation. Private sector development programs include training in technical subjects, entrepreneurial management, export and investment promotion, and finance. -- Human Resources Development: Strengthening the human resources of Haiti through education, health, and family planning assistance. US programs include using grants to strengthen the capacity of private voluntary organizations and Haiti's governmental health resources. Family planning and health programs are aimed at improving prenatal care and infant and child health and survival. Drug awareness and prevention are also priority programs. Haiti was designated to be eligible for the trade and investment benefits under the Generalized System of Preferences (GSP) in 1976 and under the Caribbean Basin Initiative, effective January 1, 1984. Consolidation of Democracy. Father Jean-Bertrand Aristide's landslide election victory in December brought to power a leader outspoken in his commitment to improving the lot of Haitians. His inauguration in February 1991 had the support of the Haitian military and was greeted by widespread public celebrations. Economic Conditions. After two centuries of colonialism and autocratic rule, Haiti's GNP remained the lowest in the Western Hemisphere in spite of a capable and industrious labor force and significant development and investment potential. GNP has not kept pace with population expansion. The country's human resources are handicapped by illiteracy, inadequate diet, limited educational and health facilities, and the emigration of large numbers of skilled workers. Agriculture employs about 66% of the work force and provides for about a quarter of the country's export income. Light manufacturing has become a major employer, particularly in the capital. The limited fertile areas are heavily overpopulated, and farming is typically on one-family subsistence plots. Profits from coffee, long the country's main crop and principal agricultural export, have decreased because of diminished productivity and low world prices. Other important exports are cocoa, essential oils, and light manufactured products. The country has few mineral resources. The most dynamic area of the economy is the growth of export oriented transformation industries, in which raw or partially finished materials--mainly electronics, sporting goods, and garments--are assembled for sale abroad, primarily to the US. This sector employs about 40,000 workers. One of the biggest incentives to manufacturers is Haiti's hard-working labor force and low wage structures. The United States purchases about 85% of Haiti's exports and supplies the country with about 62% of its imports, made up mostly of machinery, foodstuffs, petroleum, and cotton textiles. Foreign Relations. Haiti is one of the original members of the UN and several of its specialized and related agencies and the Organization of American States (OAS). Haiti maintains diplomatic relations with most countries in Latin America and Europe, although many of those countries do not maintain embassies in Haiti. Tensions exist between the Government of Haiti and the Dominican Republic over recent Dominican efforts to repatriate undocumented Haitians living in the Dominican Republic. Multilateral Assistance. The Inter-American Development Bank (IDB), the UN Development Program (UNDP), and the International Monetary Fund (IMF) maintain resident representatives in Haiti, and a small OAS technical mission has assisted the Haitian Government since 1968. The IDB, the World Bank, and the UNDP contribute economic assistance to Haiti, as does the European Community, under the terms of the Lome accords, to which Haiti became a full member in December 1989. Haiti also received balance-of-payments financing in 1990 under a standby agreement with the IMF. Other donors include the US, Canada, France, Germany, and Japan. In July 1991, Haiti successfully concluded its first international donor group meeting in Paris. International donors, both bilateral and multilateral, pledged strong support for Haiti's development efforts. Haiti at a Glance. Haiti is the oldest black republic in the world and is the second oldest republic in the Western Hemisphere after the United States. With 6.5 million people in 10,700 square miles, it ranks as one of the most densely populated countries, and, with a per capita income of $300, it is the poorest country in the hemisphere. The economy has declined sharply during the past decade, with per capita income falling 25% since 1980. Serious unemployment, currently estimated as high as 70%, remains a major concern. Although public education is free and compulsory for the first 6 years, only half of eligible children attend. Private and religious education provide perhaps 75% of programs offered. Education beyond primary school is uncommon. The state religion is Roman Catholicism. Protestants number about 10%. Traditional African religious (Voodoo) practices are widespread, as Haitians tend to see little conflict between them and the formal Christian faiths.
VENEZUELA
US-Venezuelan Relations. The United States and Venezuela have a similar global view--one of strengthening democratic institutions around the world; furthering human rights; accelerating sound economic, social, and cultural development through orderly and progressive change within the framework of a free society; and cooperating in the defense and security of the Western Hemisphere against aggression or subversion. Venezuela not only endorses the theoretical goals of democracy but also works with the United States to promote democracy and human rights. For example, Venezuela has adopted the American Convention on Human Rights and supports the Inter- American Commission on Human Rights. Along with the United States, Venezuela supports the goals of nuclear non-proliferation in the hemisphere, conventional arms restraint, anti-terrorism, and the promotion of hemispheric economic development. Venezuela and the United States also have similar views on the importance of democratization as a key element in a solution to the long-term problems of Central America and the Caribbean. President Perez made a state visit to the United States in April 1990, at which time he and President Bush continued their frequent discussions on a broad range of issues. President Bush visited Venezuela in December 1990. Political Conditions. Venezuela's history since 1958 has been marked by periodic competition for political power based on free and open national elections that have earned Venezuela a reputation as one of the most stable democracies in Latin America. In December 1989, governors in 20 states and mayors in 269 municipalities were elected for the first time in Venezuelan history. Those elections were also the first to use a system that allows voters to choose individual candidates by name rather than selecting only among party slates. Opposition parties won nine gubernatorial contests. Carlos Andres Perez was president from 1974-79 but was barred by the constitution from succeeding himself. He began his unprecedented second 5-year term on February 2, 1989, with a series of reforms designed to increase the efficiency and competitiveness of Venezuelan enterprises, reduce Venezuela's dependence on oil exports, and enhance its image with the domestic and foreign investment communities. To help prepare Venezuela for the 21st century, his economic team seeks to reduce the state's role in the economy and scrap protectionist policies. Economic Conditions. About the size of Oklahoma and Texas combined, Venezuela is rich in oil and other mineral resources. The economy is dominated by the petroleum industry, which accounts for 80% of exports and more than 50% of government revenues. Agriculture accounts for only 6% of GDP, with coffee and cocoa the main export crops. Venezuela manufactures and exports petrochemicals, steel, aluminum, textiles, apparel, beverages, and foodstuffs. The United States is Venezuela's most important trading partner, representing more than 45% of its international trade. The United States exports machinery, transportation equipment, agricultural commodities, and automobile parts in exchange for Venezuelan oil and other natural resources. In April 1991, Venezuela and the United States signed a trade and investment framework agreement to explore ways of expanding commercial relations. Foreign Policy Issues. Venezuela has numerous border disputes with its neighbors but is actively working to resolve these centuries-old conflicts in a peaceful manner. President Perez has been active on the international scene. Venezuela has joined the Non-Aligned Movement, helped monitor preparations for elections last year in Nicaragua and Haiti, and provided substantial aid to those countries to help consolidate democratic reforms. President Perez is actively involved in promoting the peace process in El Salvador. Venezuela at a Glance. Venezuela's population of 19 million is changing rapidly from rural to urban. In 1936, 35% of the population lived in cities and towns of more than 1,000 inhabitants. Today, about 80% do. One of five Venezuelans lives in Caracas, the capital. Education is compulsory for 9 years; 88% of Venezuelans are literate. Per capita income is $2,598. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

Panama--Road to Recovery

Aronson Source: Bernard W. Aronson, Assistant Secretary for Inter- American Affairs Description: Statement before the Subcommittee on Western Hemisphere Affairs of the House Foreign Affairs Committee, Washington, DC Date: Jul 30, 19917/30/91 Category: Speeches, Testimony, Statements Region: Central America Country: Panama Subject: Democratization, Regional/Civil Unrest, Narcotics [TEXT] Mr. Chairman, members of the Subcommittee. I welcome the opportunity to appear before you today to discuss the situation in Panama and our efforts to help Panama consolidate democracy and rebuild its economy. Nineteen months after Operation Just Cause, Panama is free, and democracy, I believe, is irreversible. The government chosen in an election [that] General Noriega tried to hijack is now in office. A free, critical press operates without fear of intimidation. Open, vigorous competition among democratic political parties has replaced the repression of the Noriega era. The Panamanian Government has adopted new regulations and agreements with the United States to combat drug trafficking. The military which ruled and looted Panama for two decades has been abolished, and a new civilian-controlled police is being trained to take its place. Economic confidence is being restored and unemployment has been cut in half. Panama has been welcomed by its Central American neighbors into regional efforts to achieve political and economic integration and has normalized its diplomatic relations with all other Latin American nations. Panama was looted and repressed for more than two decades. As a result, the Endara Government inherited a country in ruins. The National Bank had $1 billion outstanding in bad checks written by the Noriega regime. Virtually every storefront in Panama City and Colon had been ransacked, resulting in over $400 million in business losses. Over 80% of Panama's commercial establishments were closed at the beginning of 1990, and roughly 35% of the work force was unemployed. Around 16,000 members of Noriega's Panama Defense Forces [PDF] had to be either fired or retrained as civilian policemen. Schools were reduced to hollow shells, with all books, desks, blackboards, and even plumbing fixtures stripped from within. Public services were at a standstill. Garbage collection did not begin until the United States provided gasoline for the few remaining trucks. In December 1989, when President Bush ordered US forces into that country, the rule of law had ceased to exist in Panama. The results of the May 7, 1989, elections were annulled and the regime mocked the OAS [Organization of American States] when it tried to mediate a peaceful solution. Those who were nominally responsible for upholding the laws were actually involved with large-scale officially sanctioned drug trafficking and money laundering. There was a cocaine lab operating in the offices of the chief of Noriega's immigration service. The regime was involved in virtually every sort of corruption. For $10,000, visas were made available to Cubans seeking to escape their homeland. At the same time, the administration offered protection to Cuban front companies established in Panama to seek ways around the US trade embargo. The Noriega regime also established the paramilitary "Dignity Battalions" armed by Castro, which were on their way toward becoming a permanent paramilitary force loyal only to Noriega. Noriega's forces were also heavily armed, as evidenced by the seizure or purchase of 55,000 personal weapons during and immediately after Operation Just Cause. The political initiatives taken by General Torrijos at the end of the decade toward restoring democratic processes were reversed by the military after his death in 1981. Year by year, opponents of the military regime were jailed, silenced, exiled, or killed. Not one of the 2,000 habeas corpus petitions presented to the Supreme Court from 1986 until 1989 was resolved in favor of a political prisoner. Independent media voices were eliminated. Basic legal and political rights were curtailed. By December 1989, the memory of democratic politics in Panama was in fact over 20 years old. On December 20, 1989, the government just empowered to meet these challenges consisted of only three men, President Endara and his two vice presidents. There was as yet no cabinet. In most government offices there were no desks, no office equipment. Government workers employed by Noriega had to be reintegrated into an honest and accountable bureaucracy. Despite these overwhelming problems, post-Operation Just Cause Panama is held to a standard of performance that no government--let alone a new coalition government taking over from a corrupt dictatorship--could meet. Much remains to be done to reduce poverty, improve public services, combat drug trafficking, train a new national police force, reform the administration of justice, and prepare for the transfer of the canal in the remaining years before 1999. But important progress has been made in each of these areas. Through our diplomacy and with the resources we are able to provide, we will continue to help Panama meet these goals.
Supporting Democracy
The goal of US policy in Panama is to support and consolidate the democratic process. We do not and will not support specific groups or individuals in their pursuit for power or advantage. We do and will support a process that allows all members of society to compete through political means and makes them accountable for their decisions. Essential to the establishment of stable democracy in Panama--and, therefore, key US policy objectives--are a healthy, open economy, a professional civilian police force which respects the basic human rights and political liberties of Panamanian citizens, and an honest, efficient, and apolitical system of justice. The Panamanian people recognize and appreciate the role the United States has played in re-establishing and supporting democracy in Panama. In January 1990, a Gallup poll showed that 90% of Panamanians supported the US military action which removed Noriega, deeming it a "liberation" rather than an "invasion." Panama's view toward the United States has remained favorable. A March 1991 poll showed that 80% of Panamanians have a favorable personal opinion of the United States. A more graphic demonstration of this close bond occurred during the first week of July, when "Friendship Week"--in which 100,000 Panamanians participated--was organized by Panamanians to highlight our close bilateral ties. Panama today is a functioning democracy. For the first time in more than two decades, Panama is ruled by a democratically elected government. Legal and constitutional rights have been restored. A free media flourishes; Panama has six daily newspapers, three commercial TV stations, and many radio stations filling the entire range of the ideological spectrum. The Panamanian people are exercising their political rights, including the right to criticize their elected leaders and to debate the merits of government policies and actions. Moreover, the elected Government of Panama no longer facilitates the illegal narcotics trade; instead, it is committed to cooperating with us against drug traffickers and money launderers. The past 19 months have seen the progressive normalization of Panamanian political life within a democratic framework. In January 1991, the government held legislative elections to fill nine seats for which the May 1989 national elections had yielded disputed results. In April, the Christian Democrats withdrew from the governing alliance over substantive and patronage issues and are now the principal opposition party. The Democratic Revolutionary Party, the party associated with Torrijos and Noriega, holds 10 seats in the 67-person Legislative Assembly, along with three other opposition parties. As with any newly emerging democracy, the process has not always been tidy and smooth. Panama's problems are complex and interrelated, its resources are constrained, and its society's claims are varied and competing. Tension and friction are normal in an open political process, even in industrialized democracies which have existed for many years. These difficulties were perhaps all the more likely in a society in which some had unrealistically come to expect that the return of freedom would itself cure all problems. It is not the absence of problems that constitutes evidence of democratization but rather the resolution of those problems by democratic means. By this standard, democratization is on track in Panama.
Economic Progress and US Aid
I am also pleased to report that Panama continues on the path to economic recovery. The Government of Panama estimates that GDP grew by at least 3.4% in real terms in 1990, and private sources place growth at over 5% for that year. Growth is projected to be at least 5% for 1991. Exports grew by 8.4% in 1990. Trade and construction have shown a strong recovery. The banking system has been strengthened by capital repatriation--deposits have increased by over $6.3 billion since Operation Just Cause. Unemployment has decreased from over 35% to under 20%. The Panamanian Government deficit was cut from 11% of GDP in 1989 to 3.4% in 1990. The government is moving forward on the privatization and restructuring of state enterprises and on clearing Panama's arrears with international creditors. Panama's debt to official, non- commercial creditors was rescheduled in November 1990 on highly favorable terms. I have provided the members of the subcommittee with a fact sheet on the delivery of 1990 US aid in the form of Economic Support Funds (ESF). The United States and Panama have signed agreements covering over 95% of the $461 million provided last year. The President's request was designed to provide sufficient funds to "jump start" the economy. These arrangements are now in place, and disbursements are progressing under each element of the aid program. As of the beginning of this month, Panama had received over $280 million in direct assistance, and $130 million of this amount has been set aside in escrow at Panama's request to help clear its arrears to the World Bank, IMF [International Monetary Fund], and Inter-American Development Bank. The $41 million of US assistance provided in February 1990 as part of the "Urgent Assistance to Democracy Act" has been used to help create 3,500 new jobs for Panamanians, [and] to provide loans to small businesses that suffered damage during the looting which followed Operation Just Cause and homes for the people of the El Chorrillo neighborhood, which was destroyed by fleeing Noriega forces. The remainder of the aid is being used to help the banking system provide medium-term credit for private sector investment and plant expansion, for budget support to assist Panama refurbish its poorly maintained infrastructure, and for clearance of Panama's arrears with the international financial institutions. Other funds are for projects to help train Panama's police, to improve the administration of justice, and to help Panama protect is environment. Our assistance has gone a long way toward improving social and economic conditions in Panama, especially in the immediate aftermath of Operation Just Cause. We have provided real assistance to real people. Over 1,900 families from Chorrillo have moved into their new homes. Over 250 small businesses received loans which allowed them to reopen their doors. Over 2,000 law enforcement personnel have attended ICITAP [the US Department of Justice's International Criminal Investigative Training Assistance Program] training, and over 5,000 have taken a course in basic police skills taught by Panamanian instructors who were previously trained by ICITAP. Two hundred-eighty park guards are being trained and equipped to protect Panama's natural resources.
Building the Judicial System
With US assistance, Panamanian authorities have made steady progress in creating a new, professional, national police. With the dissolution of Noriega's PDF during Operation Just Cause, the Endara Government faced an urgent need to reestablish the law enforcement functions previously performed by the PDF. At the same time, the new government was committed never to permit again the re-emergence of a military force that could threaten civilian democratic rule. The PDF itself was abolished, and the current police force now numbers 10,642 as opposed to the 16,000 PDF on the eve of Operation Just Cause. The government has removed or replaced over half of the officers at the rank of captain or above and all of the officers ranked at or above lieutenant colonel. With our assistance, Panamanian authorities have made steady progress in transforming the PDF into a professional, civilian law enforcement entity. The Department of Justice's ICITAP is working with the new police to ensure that they acquire the skills necessary for the performance of civilian law enforcement duties. ICITAP is providing a $13.2 million in training and non-lethal equipment such as police cars, uniforms, and communications equipment to Panama. Over 5,000 have taken a course in basic police skills taught by Panamanian instructors who were previously trained by ICITAP. A new police academy, assisted by ICITAP, will train 1,250 new recruits per year, all of which will be at least high school graduates--an exceptional level for police in Latin America. A civilian lawyer who opposed the Noriega regime directs the National Police, while another civilian now directs the investigative service, the Technical Judicial Police. Finally, to ensure that the PDF is not reborn at some later date, Panama is amending its constitution to abolish permanently its armed forces, thus joining Costa Rica as one of only two demilitarized Central American countries. Also with our assistance, the new government has taken important steps for narcotics control. Panama continues to be a transshipment point for drugs and essential chemicals, but conditions in Panama and the performance of the Panamanian Government on narcotics are far better than recent press articles would have us believe. The July 16 GAO [US General Accounting Office] report which has provoked criticism by the press and even by Members of Congress states that there are no reliable statistics on the level of drug trafficking or money laundering in Panama. Yet those who are quick to accuse state that these problems are on the rise in Panama. In reality, what has happened in Panama is that a corrupt dictator who actively promoted and participated in drug trafficking and money laundering has been replaced by a government which actively pursues counter-narcotic efforts and is committed to cooperating with the United States in this area. Panama and the United States have signed a Mutual Legal Assistance Treaty, and President Endara called a special session of Panama's Legislative Assembly which ratified the agreement on July 15, 1991. This is the latest in a steady progression of actions demonstrating the Endara Government's commitment and cooperation on counter-narcotics. Within 3 weeks of taking office, the Endara Government had signed a bilateral mutual cooperation on narcotics agreement with us. One month later, the cabinet issued bank regulations on the recording of cash transactions in excess of $10,000. Agreements are in place for US authorities to board suspect Panamanian ships and for joint patrols and training by the US Coast Guard and the Panamanian Maritime Service. Panama's attorney general has provided bank records for use in six ongoing money-laundering investigations covering over 400 accounts in 12 different banks. Vice President Ford has stated that Panama will shut down any bank proved to be involved in money laundering and has asked that the United States provide proof rather than allegations in such cases. Panamanian law enforcement institutions have a credible record of narcotics seizures and drug- related arrests. The judicial technical police captured more than 5,000 kilograms of cocaine in Panama in 1990, including a 2,118 kilogram confiscation which was the largest single seizure in Panamanian history. Some areas of performance, however, have been less positive, such as the administration of justice, which is among the most difficult problems Panama faces. The legacy of the Noriega years is particularly difficult in this area. Court records and actual court rooms were destroyed. Prisons were overcrowded and conditions were well below minimum standards. The Endara Government's objective is a professional, apolitical justice system which protects the human rights and political freedoms of the Panamanian people. We share and support that goal. The serious problems within the judicial system are due to a shortage of judges, prosecutors, public defenders and investigative personnel, their often inadequate professional skills, and a continuing increase in an already overwhelming caseload. Nevertheless, the Endara Government has taken several initial positive steps, and it is committed to further reform. Four new judges and ten administrative officers have been appointed to begin clearing the backlog of cases in the Panama City area. Panama's 1991 budget included funding for 15 new public defenders, bringing the total to 31 of the 36 currently required by law. Judicial officials have been visiting penal facilities to review cases, set trial dates, and issue writs of release for individuals whose sentences were nearing completion or who had been held for long periods without trial. The number of prisoners in Panama serving pre-trial detention has dropped from 91% of the population in 1990 to 80% today. Because of the seriousness of their offenses, many of these accused offenders do not qualify for release on bail or restriction to house arrest. However, the judicial reform code enacted in January permits alternatives to preventive detention for many accused offenders. Trials of Noriega-era criminals have begun; on July 1, a former captain in the Noriega-era PDF received a 42-month prison sentence for extortion. This autumn, the legislature will consider a bill providing for an 18-month window in which trials of Noriega cronies accused of human rights violations will be given priority in court dockets. The United States and Panama are engaged in a 5-year project for the improvement of the administration of justice in Panama. The goal is a criminal justice system that is fair, efficient, and free from political and extra-judicial influence. Implementation of the program, which began in March, is principally designed to improve the operation and coordination of the judiciary, the prosecutors, and the public defenders in criminal investigations and trials. To date, our assistance has helped renovate office space for the Supreme Court; purchase office equipment, computers, and supplies for the Supreme Court and Public Ministry; and sponsor workshops for judges and prosecutors. We are now in the process of providing full legal reference libraries to the courts and are planning a training school for judges and prosecutors. In addition, we will provide equipment and training to help the judiciary better manage its personnel, records, and budget. Our aid will pay for a computerized case tracking system. US assistance was used last summer to buy a minibus to carry jurors to trials. In the period from August to December 1990, the minibus transported jurors to the 2nd Superior Court. As a result, the court completed 38 cases in that period; the same court completed only 17 cases per year from 1987-89. The Panamanian correctional system is badly in need of reform. In February, at the request of the Government of Panama, a team from the US Bureau of Prisons visited Panama, surveyed the situation, and made recommendations for correcting the stark deficiencies of the Panamanian prisons system. These include inadequate medical care, unsanitary conditions, insufficient and demoralized supervisory staff, and inappropriately long pre-trial detention periods. The Panamanian Government has asked for the assistance of the Bureau of Prisons in implementing these recommendations, but neither FAA [Foreign Assistance Authorization Bill] Section 534 nor the Panama supplemental authorizes direct assistance to prisons. We are pleased that the FY 1992 Foreign Assistance Authorization Bill that will soon go to conference permits the kind of direct US assistance to prisons that the Government of Panama has requested. We urge enactment of this important expansion in regional authority for the administration of justice program. In the meantime, we will continue to explore other options to support the Government of Panama in the implementation of the Bureau of Prisons recommendations. Panama is currently negotiating with the international financial institutions to clear its financial arrears so that it will become eligible for renewed lending and the disbursal of tied aid. In so doing, Panama should recognize that the structural economic reforms it is being asked to make represent an excellent opportunity to open its economy and thereby stimulate long-term economic growth. Another important change in our bilateral relations was symbolized by the appointment of Gilberto Guardia, the first Panamanian administrator of the Panama Canal. The United States is committed to implementing fully the Panama Canal Treaties. Panama must also begin to plan carefully for the turnover of the Panama Canal in 1999. The canal and its related properties make up Panama's greatest resource, providing $80 million in revenues to the Government of Panama each year and over $200 million in salaries to Panamanians employed by the Panama Canal Commission. Even though the Government of Panama has taken some initial steps toward post-1999 planning, it must now fully engage in the process to guarantee a successful outcome.
Casualties From Operation Just Cause
Let me now turn briefly to the issue of civilian casualties during Operation Just Cause. Frankly, there should be no need to do so, but some shoddy, demagogic reporting about Panama makes it necessary. There is no basis whatsoever to the reports that thousands of civilians died in Operation Just Cause. Thorough investigations by several human rights groups--including Physicians for Human Rights, Americas Watch, and the Panamanian Committee for Human Rights--found no evidence to support such allegations. The Institute of Legal Medicine in Panama, which based its estimates on recovered remains, suggests a range of between 270 confirmed dead and a maximum of 345 possible military and civilian deaths. There are only two known instances in which Panamanian nationals were interred in common graves during Operation Just Cause. In both cases, Panamanian officials ordered the burials for public health reasons, and the Panamanian Coroner's office subsequently exhumed the bodies for proper identification and final disposition. These deaths were included in the Panamanian Government's casualty figures. I have provided a fact sheet for your convenience which gives a detailed discussion of this subject. With regard to compensation, according to the US Code and the Foreign Claims Act, a claim may not be allowed if it arises as a result of action by an enemy or as a result of military actions by the US Armed Forces. The US Army Claims Service at Fort Clayton, Panama, has been reviewing claims arising out of Operation Just Cause that did not fall under the restrictions established in US law. By July 1991, payments of over $180,000 had been made in over 150 cases to US citizens, Panamanians, resident aliens, and third country nationals. The US aid program has also been designed to assist others who suffered in connection with Operation Just Cause regardless of the reason, such as the residents of El Chorrillo.
Conclusion
In conclusion, Mr. Chairman, Panama has rejoined the community of democracies in this hemisphere. Like many other nations in the Americas which have just emerged from dictatorship, Panama is working to overcome all the difficulties inherent in establishing democratic processes, a sound economy, a judicial system, and a smoothly functioning government administration all at once. The people of Panama have made great progress to date. We are working closely with the Government of Panama on a wide spectrum of issues, and we expect continued progress, including in areas such as drug enforcement and preparations for the canal transfer, which are key to our interests. The Panamanian people are grateful for US support, but in the end Panama's future depends not on us, but on them. We are confident Panama's democracy is here to stay, that Panama's economy will continue to grow--if necessary reforms are set in place--that as Panama's new government grows stronger its ability to cooperate with the United States on counter-narcotics will grow, and that democratic Panama will be able to shoulder the important responsibility of administration of the canal in the year 2000 and beyond. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

US Policy Toward Cuba

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: Jul 11, 19917/11/91 Category: Speeches, Testimony, Statements Region: Caribbean Country: Cuba Subject: Democratization, Travel, Immigration, Nuclear Nonproliferation [TEXT] Mr. Chairman and members of the subcommittee, it is a pleasure to join you today to discuss the Administration's views and policy toward Cuba. I recently returned from the annual General Assembly of the Organization of American States, which was held in Santiago, Chile. This meeting was more than a celebration of Chile's return to democracy--it was the first time that all 34 nations were represented by freely elected governments. The people of Latin America and the Caribbean, long freed from colonial domination, have embraced democracy as the only legitimate form of government. To reach that aspiration, many of these states-- Nicaragua, Chile, Guatemala, Haiti, Paraguay, Panama, and El Salvador among them--invited the international community to support democracy by observing and reporting on their elections. Another trend was apparent at Santiago: these democracies are discarding the closed economic models of the past and are embracing open markets. No government is sticking with the failed statist model. In the past, in too many countries in this hemisphere, strong central government control led to closed systems, often rigged in favor of a privileged few, where the poor were shut out and society as a whole squandered its opportunity to develop. In the Americas today, the future belongs to free men and women in free, open societies, competing and developing to the fullest of their abilities. At Santiago, the General Assembly warmly endorsed the Enterprise for the Americas Initiative as "an especially valuable instrument for promoting the region's comprehensive development." Unfortunately, Cuba stands apart from these trends. The Government of Cuba holds no free elections and denies basic political, civil, and economic freedoms. Cuba stands alone in providing weapons and political support to groups such as the FMLN [Farabundo Marti National Liberation Front] in El Salvador, which are violently assaulting democratic constitutional governments. In defying the trend toward democratic reform of authoritarian regimes elsewhere, the Government of Cuba has isolated itself from its traditional sources of support, including countries of Eastern Europe, the Non-Aligned Movement, Latin America, and even the Soviet Union. Germany and Czechoslovakia have, in the past year, terminated trade ties with Havana, citing its human rights practices. In international forums, Cuba has isolated itself by complicating progress toward consensus on major issues. For example, as a member of the UN Security Council, Cuba voted against several crucial resolutions on Iraq, including the seizure of Iraqi sea and air vessels, the use of force, the cessation of hostilities and terms for a cease-fire. There is another area where the policy of the Cuban Government stands in sharp contrast to the positive and hopeful trends in Latin America--nuclear non-proliferation. As you know, the President of Brazil, Fernando Collor de Mello, was in Washington recently on a state visit to meet with President Bush. I know some of you had the chance to meet with President Collor also. Brazil and Argentina announced last November a common nuclear policy calling for joint negotiations of a full scope safeguards agreement with the International Atomic Energy Agency (IAEA) to guarantee the peaceful use of their nuclear programs and to follow that step by waiving into force the Treaty of Tlatelolco. On his visit to Santiago, Chile, in December 1990, President Bush was told by President [Patricio] Aylwin that Chile intended to take parallel action with Brazil and Argentina in waiving Tlatelolco into force. President Collor told President Bush in June that the negotiations with the IAEA are on schedule, and agreement with the IAEA should be reached later this fall. Soon, therefore, every nation in Latin America, with the exception of Cuba, will have committed itself by treaty to renouncing development of nuclear weapons. I point out these trends not to engage in "Cuba bashing" but to make a point; the Government of Cuba stands isolated today from this hemisphere--by refusing to permit its people to vote in free and fair elections, by refusing to permit freedom in the marketplace, by refusing to renounce support for violent revolutionary movements, and by refusing to join the international community in curbing proliferation of nuclear weapons--in other words, by its own policy decisions, not as a result of US policy. The Cuban Government often speaks of a military threat from the United States and wastes enormous sums of money in defense exercises. The United States poses no military threat to Cuba; we have no aggressive intentions toward Cuba, and we have no desire to order Cuba's internal affairs. The US "threat" exists only as an excuse for the Cuban Government to justify its denial of basic liberties to the Cuban people. Last May 20, on Cuban Independence Day, President Bush made it clear that he would welcome changes in the US-Cuban relationship. He said: "If Cuba holds fully free and fair elections under international supervision, respects human rights, and stops subverting its neighbors, we can expect relations between our two countries to improve significantly." We hope the Government of Cuba will choose that course. Democratic processes could assure peaceful change in Cuba. Democratic institutions would give legitimacy to a successor government. Cuba could embark on a path that would bring it into this hemisphere's democratic mainstream, and we would build the kind of relationship with a democratic Cuba that is appropriate to two close neighbors whose peoples share many common hopes, many family bonds, and a long history of friendship.
Conditions in Cuba
After years of sacrifice in the name of revolutionary change, Cubans are reaping not the fruits of success and growth, but widening misery and continued political repression. They see empty shelves and long lines--and government officials blaming shortages on the "psychology of consumer anxiety," in other words, on the Cuban people. The best restaurants, hotels, and shops are not available to ordinary Cuban citizens but instead are reserved for wealthy foreigners with hard currency to spend. The economic crisis has reached such proportions that a nationwide austerity plan, the "Special Period in Peacetime," was announced in July 1990. The "Special Period" includes rationing of basic goods and electricity. If a family violates the rationing procedures, its electricity can be cut off for 1 month. Urban workers are being sent to the countryside for 2-week stints as field laborers. Oxen are replacing tractors, urban bus service is being cut back, and hundreds of thousands of Chinese bicycles are on order. We have seen one report that Cuba plans to create up to 5,000 new rural towns to return the population to agriculture. On June 1, bread rationing began in Havana. Waiting in line for basic goods has become such a burden that a new enterprise sprouted up--waiting in line for a fee. This is a crime, however. Last December, Havana television reported nine people received fines or prison sentences for selling their places in line. In a recent interview, Fidel Castro was looking ahead to the October congress of the Cuban Communist Party. Despite Cuba's current difficulties, he said "there is not even a remote possibility" that the congress would favor a market economy. He also said: "Changes such as abandoning the principle of the single party will never happen."
Current Bilateral Relations
It is often suggested that Cuba and the United States hold a dialogue. In fact, despite our deep disagreements with the fundamentals of Cuban policy, the United States does maintain government-to-government contact and exchanges through the US Interests Section in Havana and the Cuban Interests Section in Washington, DC. We recognize the usefulness of having a line of communication on issues which concern both countries as close geographic neighbors. We have bilateral agreements or understandings on migration, search and rescue, and the exchange of real-time information to aid in the apprehension of narcotics traffickers. Some of this cooperation, at least on our side, is prompted by humanitarian concerns. The immigration agreement, for example, has allowed Cuban citizens to come to this country to escape repression and to rejoin their families. Since the Mariel Migration Agreement was signed in December 1984, more than 19,000 Cuban citizens have arrived in the United States as immigrants, refugees, or parolees. Most would not have been able to come here had the agreement not been in place. In addition, Cuba has accepted the return of 658 Cubans who are considered excludable from the United States under US law. In recent months, more and more Cubans have arrived in the United States. In a series of decisions beginning in March 1990, the Cuban Government gradually changed its policy on travel abroad. The age limit for foreign travel was reduced from 65 and 60 for men and women, respectively, to 35 and 30, and exit permits were issued to the majority of those who applied. We understand the age limit may be reduced even further, possibly as low as 18. One motivation for this change in policy is clearly financial, as the Cuban Government adds $900 or more in fees, payable in US currency only, to the cost of each Cuban's travel. Although we welcome the decision of the Cuban Government to liberalize exit requirements, Cubans who seek to enter the United States should do so in accordance with US law and established procedures. Those individuals who wish to come to the United States to establish new lives must apply for immigrant visas, not seek to enter on non-immigrant or tourist visas. In addition, Cubans should not risk the hazardous passage across the Florida Straits in small boats or rafts. This is extremely risky, and many have lost their lives in the attempt. Given the continuing repression and economic deterioration in Cuba, there has been speculation about the possibility of another "Mariel" boatlift. The President's policy is clear--the United States will not permit another Mariel. The Cuban Government knows this. We have plans to deal with such a contingency, and we are fully prepared to do so. On June 5, 1991, my principal deputy, Michael Kozak, provided information to this subcommittee on the issue of Cuban migration and Cuban/Soviet construction of a nuclear energy facility at Cienfuegos, Cuba, and I will not repeat his testimony here, but I am prepared to answer questions.
Soviet-Cuban Relations
The political transformations of the Soviet Union and Eastern Europe have led many to ask whether and when change will come to Cuba. That question has no clear answer. What is clear is that change in the socialist bloc has left Cuba politically isolated from its former close allies, and it has accelerated economic decline. Soviet aid is crucial to Cuba's economy, and the future of Soviet aid is a major factor in any estimation of prospects for change in Cuba. The Soviets, with economic shortages of their own, are vigorously debating their policy toward Cuba, and the outcome of that debate is not yet clear. As the debate continues, we receive many conflicting signals. For example, last month an unconfirmed news report from Moscow said that an interim barter trade arrangement (of unstated duration) had been worked out until both the Soviets and Cubans were capable of trading in convertible currencies. Amid all the conflicting signals, the conclusion I draw is that the Soviets have made some interim arrangements with Cuba, they are doing their best to fulfill their commitments, and their overall support is declining. The Soviet-Cuban economic relationship is clearly not on a stable long-term footing. Over the past 5 years, Soviet economic and military aid has ranged as high as an estimated $5 billion annually, or, the equivalent of about one-fifth of the total production of the Cuban economy. The Soviet Union alone accounted for 70% of Cuba's total trade in 1989. Total estimated Soviet military and economic aid in 1990 was $4.5 billion. There is no single country or group of countries which can easily replace the Soviet Union as a source of vitally needed imports and a reliable market for Cuban exports. Soviet trade and assistance, however, do not have to remain at 1989 levels to ensure the survival of the regime. Cubans are making do with less. Although lower than before, Soviet economic assistance to Cuba in 1990 reached an estimated $3.5 billion in development aid, trade credits, and subsidies. The most important Soviet subsidy is for Cuban sugar. The Soviet Union purchases the bulk of Cuba's sugar and nickel, in return providing Cuba with 90% of its oil and much of its grain and machinery. The Soviets value Cuban sugar substantially above the world spot-market price. In 1990, total net bookkeeping subsidies (Soviet overvaluation of sugar minus Cuban overvaluation of oil) amounted to about $2.2 billion. This overvaluation (or subsidy) appears to have dropped significantly during 1990 as a result of a shift in terms of trade with the Soviet Union. In 1989, Cuba received 3 tons of oil for each ton of sugar; in 1990, Moscow supplied only 2.5 tons of oil for each ton of sugar. This overvaluation will shrink further in 1991, reflecting the lower sugar price agreed for this year, which is comparable to what the European Community pays for imported sugar. Last year, Soviet trade credits to Cuba (loans, as distinct from subsidies) amounted to an estimated $500 million in additional aid. Direct Soviet technical and development assistance totaled approximately $792 million. We estimate that between 1989 and 1990, Soviet oil deliveries have dropped from 13 to 10 million tons annually. The two ongoing major Soviet development projects in Cuba are the Cienfuegos nuclear energy plant and a large oil refinery. The completion of these projects would reduce by 10% to 15% Cuban reliance on Soviet oil. The 1991 1-year Soviet-Cuban trade agreement projects bilateral trade and aid at the same levels as 1990. Soviet deliveries, however, are behind schedule. In addition, Moscow has, in the past year, withdrawn half of its civilian technical advisers-- about 1,200--from Cuba as part of a worldwide cutback and states that it will recall more. Eastern Europe also has curtailed most aid to Cuba and drastically reduced trade, which used to represent 15% of Cuba's total world trade. For decades, Soviet military aid has allowed Cuba to build the second largest military force in Latin America --second only to Brazil, a country 15 times Cuba's size--and to influence and intervene militarily in countries as diverse as Ethiopia, Angola, Chile, Grenada, Nicaragua, and El Salvador. Estimated at about $1.3 billion annually over the past 5 years, Soviet military aid declined in 1990 as part of the overall reduction in Soviet assistance. Reduced supplies of Soviet oil have resulted in reduced training and use of its military equipment. However, in 1990 Cuba received a partial squadron of Soviet MiG-29 fighters. The return of sizeable quantities of military equipment and weapons systems from Angola has helped mitigate the impact of reduced Soviet deliveries. The Soviet Union continues to receive major strategic and intelligence benefits from Cuba. The Lourdes signals intelligence facility, for example, is the most sophisticated outside the USSR. And the Soviets maintain a 2,800-member military brigade stationed at or near the facility. Although the Soviet presence in Cuba has been drawn down as part of worldwide cutback, there is no indication the Soviets intend to reduce their presence at Lourdes.
Cuba and US-Soviet Relations
Soviet military and economic aid to Cuba remains a major problem in the Soviet Union's relationship with the United States. It helps prolong the tenure of an anachronistic and autocratic government and enables Castro to avoid political and economic reform. It makes it easier for Cuba to continue to help send arms and logistical support to violent revolutionary groups like the FMLN, contrary to Cuba's public and private disclaimers. The Soviet Union recognizes the difficulty of maintaining good relations with both the United States and Cuba but is attempting to balance their competing interests. The Soviet military does not want to lose its valuable strategic relationship with Cuba. The Soviet economic system is accustomed to relying on Cuba for sugar (3.5 to 4 million tons annually), nickel, citrus fruit, seafood, and medical care, including treatment for victims of Chernobyl. On the political side, the Soviet Union is reluctant to jettison a 32-year relationship with a long-time ally. Nevertheless, many Americans find it hard to understand how the Soviet Union can claim that economic reconstruction is its overriding priority while it provides oil, grain, and valuable military equipment to the Castro Government year after year.
The Outlook
It is impossible to gauge the prospects for reform in Cuba, but the Castro regime appears committed to resist change and reform as long as possible. The Soviets have more influence within the Cuban Government and with Castro personally than any other nation, certainly more than we have. They could do more to prevent Cuban support for violent groups like the FMLN and encourage internal reform. In our dialogue with the Soviet Union, we will continue to urge them to do so. International attention also can make a difference. The decision of the UN Commission on Human Rights in March to establish a special representative to review human rights in Cuba demonstrated continued world concern about Cuba and may have contributed to the release of a number of prominent political prisoners. Unfortunately, Cuba rejected out of hand the UN special representative named by the Secretary General--Rafael Rivas Posada--as soon as he was named earlier this month. Cuba's disrespect for a decision of the UN body is particularly egregious since it comes at the time that Cuba chairs the UN Security Council and after Cuba fought hard to retain a seat on the UN Human Rights Commission. Inside Cuba, the human rights situation has deteriorated in recent weeks. The Cuban Government brands Cuban human rights activists "US stooges" or "worms," instead of addressing their legitimate demands to exercise basic freedoms. Last month, plainsclothesmen attacked and beat members of the independent "Harmony Movement" following a Sunday church service. Then, the group's leader Yndamiro Restano was accosted and beaten when he tried to attend the trial of a doctor charged with conspiracy to assassinate Castro. Restano was later briefly detained and warned to cease his political activity. Cuban authorities may intend these incidents to send a signal that it will not tolerate any dissident political activity during the Pan American Games, which take place in Havana in August. We hope the Cuban authorities release Mario Chanes de Armas--one of the world's longest-serving political prisoners--when his 30-year sentence ends on July 17. The United States also will continue efforts to assure that the Cuban people have access to alternative sources of information on what is happening in Cuba as well as in other countries. Radio and TV Marti play an important role in that effort. The Cuban people deserve to have access to alternative views--not just the party line from the state. On May 10, 10 Cuban intellectuals --including dissidents and official award-winning poets and writers--issued an appeal urging their government to prevent a national "catastrophe" by allowing direct legislative elections, freedom of travel, the re-opening of farmers markets, and by decreeing a general amnesty to prisoners of conscience. This courageous statement attests to the degree of disillusionment with Castro's revolution among those who have long been its core ideological defenders. Four of those who signed the appeal were leading members of the official Cuban Writers' and Artists' Union. The "union" responded the next day by denouncing the statement as collusion with the US Government. To an extent almost unique in world politics, the Cuban state is dominated by one person. Nevertheless, change in Cuba depends on the Cuban people themselves. Throughout Cuba, and even in the government, there are people who are well educated, capable, and aware of the events that have swept the socialist world in recent years. These are patriotic people who see the ways in which the revolution has failed. They understand the kind of reforms that can make Cubans free and prosperous, and their nation more independent than ever. The United States hopes that the Cuban people can soon enjoy a peaceful transition to the free, democratic future they deserve. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

Cuba: Visa Procedures at US Interests Section

Tutwiler Description: Statement released by the Department of State Office of the Assistant Secretary/Spokesman, Washington, DC Date: Jul 29, 19917/29/91 Category: Speeches, Testimony, Statements Region: Caribbean Country: Cuba Subject: Travel, Immigration [TEXT] Due to an unforeseeable increase in applications for non-immigrant visas at the US Interests Section in Havana, the Department of State has decided that, as of today, the Interests Section will, as a temporary measure, suspend the acceptance of new applications for non-immigrant visas from the Cuban public. This will enable our consular staff to devote its full attention to the backlog of 28,000 tourist visa applications now on file and to provide faster service to those applicants. New applications for tourist visas will be accepted once the backlog of old applications is cleared. In the interim, the Interests Section will continue to accept applications for emergency travel for humanitarian considerations, as well as from third country travelers residing in Cuba, diplomats, and Cuban academic and official visitors. Normal processing of immigrant visa applications and refugee cases, both covered under the 1984 US-Cuban migration agreement, will continue. We plan to increase our consular staff in order to provide faster service in the future. Until then, we ask the Cuban public to cooperate by not sending new applications to the Interests Section by mail or in person. We have had to take this temporary administrative measure due to an increase in applications caused by the Cuban Government's decision to lower the age limit for foreign travel. Whereas in March 1990, the age limit was 65 for men and 60 for women, today, Cuban men may travel at age 35 and women at 30. The United States welcomes Cuba's decision to ease restrictions on travel by its citizens. In order to be prepared with adequate staff, we asked for advance notice of these changes, but no notice was given. We have received approximately 70,000 tourist visa applications sine the beginning of fiscal year 1991-- well over twice last year's application rate--and processed over 41,000, more than in all of FY 1990. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

Andean Trade Preference Act: Essential To Combating Narcotics Traffic

Aronson Source: Bernard W. Aronson, Assistant Secretary for Inter- American Affairs Description: Statement before the Subcommittee on Trade of the House Ways and Means Committee, Washington, DC Date: Jul 25, 19917/25/91 Category: Speeches, Testimony, Statements Region: South America Country: Colombia, Peru, Bolivia, Ecuador Subject: Narcotics, Trade/Economics I appreciate this opportunity to discuss H.R. [House Resolution] 661, the Andean Trade Preference Act, with you. Granting special trade preferences to Colombia, Peru, Bolivia, and Ecuador is an essential component of our effort to help these front-line states to stop the production and trafficking of cocaine. The Administration strongly supports its passage. We are making progress in the war on drugs. At home, cocaine use is down, cocaine prices are up, and drug use is waning among young Americans. Internationally, we have ended the sterile, finger-pointing debate between producer and consumer nations over who is to blame and which country bears the first obligation to act. We are allies, we are working in close partnership with the Andean nations, and our work is paying off. At the Cartagena summit in February 1990, President Bush joined the Andean presidents in mutual commitments to fight drug trafficking through a strategy of mutually reinforcing actions to cut demand and supply. For our part, that commitment includes supporting the Andean nations in the development of new export opportunities, to give their people a way out of dependence on the cocaine economy. The issue in this legislation, then, goes far beyond trade. Passing the Andean Trade Preference Act means keeping our end of a bargain with our partners in the war on drugs--partners on the front lines who have sacrificed a great deal and who face tremendous social and economic difficulties. Colombia lost three presidential candidates to narcotraffickers' violence in the last presidential campaign. Even as it confronts massive poverty and a battle against over 200,000 cases of cholera, Peru is moving to stop cocaine production. Bolivia, South America's poorest country, also is devoting funds and human resources to this fight. Last October, the European Community granted broad duty-free treatment for Andean exports. Now it is our turn to take this important step to advance our strategy to stop the drug trade. The United States will derive four principal benefits from the Andean Trade Preference Act (ATPA). -- By creating new export opportunities for Andean nations, ATPA will create new economic incentives that will draw people and resources away from the illegal economy and into legal activities. Our current economic aid programs will have a greater impact with ATPA in place. -- A more prosperous legal economy will broaden the tax base of the Andean governments and increase the resources they can devote to fighting drugs. -- Passage of the ATPA will reaffirm our commitment to the Andean nations' long-term economic development and enhance the spirit of cooperation that is essential to all facets of our counter- narcotics work with these countries. -- As these countries export more to us, we can expect them to buy more of our exports. H.R. 661 is modeled on the Caribbean Basin Initiative (CBI). CBI trade preferences boosted Caribbean exports to the United States; at the same time, we increased our exports to the Caribbean. Between 1983 and 1990, our trade balance with CBI countries went from a $3-billion deficit to a $2- billion surplus, and our market share compared with Japan increased.
The Andean Strategy
To show you the impact and importance of the Andean Trade Preference Act, let me first discuss the context into which it fits. The world's entire cocaine supply originates in the Andes and makes its way to markets in the United States, Europe, and Asia. Coca leaf has been produced by peasants in the Andean highlands for centuries, but only in the past 2 decades has a sophisticated, multi- billion dollar industry grown up around coca's refined product, cocaine. To meet this challenge, we worked with Congress to put in place the Andean strategy, a comprehensive 5-year effort to support the Andean governments in fighting the illegal drug trade. We are in the second year of that strategy, and we know that our ultimate success will depend on sustained, steady work to carry out each part of the strategy. We are helping police and, when necessary, military forces to acquire the training, equipment, and intelligence they need to confront the narcotraffickers and disrupt their operations. We are helping to develop judicial systems so they can prosecute drug criminals effectively. Our economic assistance is geared to creating viable economic alternatives for the people who now earn their livelihoods in the illegal drug industry. The Administration is requesting $250 million in Economic Support Funds and $141 million in police and military aid to sustain these programs in fiscal year 1992. This is a long-term struggle. It will not be waged or won like Desert Storm. Still, even at this early stage we can cite some important accomplishments. -- For the first time in a decade, the land area under coca cultivation in the Andes did not grow in 1990. In recent years, 10- 20% annual increases had been the norm. -- The price coca farmers receive for their crop is down. In the Andes, coca leaves sell in hundred-pound units which brought prices as high as $200 as recently as 1987. Today, the high prices are in the $60-$80 range, and the price at times dips to $10, well below the estimated $30-$40 breakeven point. This reflects success in disrupting the cartels' production and transportation operations, which has resulted in weaker demand for the farmers' coca leaves. -- Cocaine seizures are up throughout the region. This year, Colombia's law enforcement authorities are seizing cocaine at nearly twice last year's rate. -- Colombia, Peru, Bolivia, and Ecuador have all adopted laws consistent with the model legislation developed by the Organization of American States to restrict access to imported chemicals essential to cocaine production. At the same time, the United States recognizes the great difficulties of fighting the Andean drug cartels. -- The cartels are flexible and able to adapt to changing conditions. They use violence to intimidate government officials and the citizens of the Andean countries, and they are able to use their enormous funds to corrupt others. -- Police and military forces in these countries need training of all kinds, including human rights instruction. -- Political will to continue the fight must be sustained even as these societies address other major social and economic problems. We have made the most progress in Colombia. With our assistance, the police and military are now able to conduct counter- narcotics operations by helicopter in any area of the country. Improved intelligence and training have enabled them to use that mobility very effectively. In consecutive weeks last April, Colombia's national police made two 10-ton seizures of cocaine. To date, 1991 seizures total 56 tons, more than the total for all of last year. Marijuana cultivation has been virtually eliminated. With our aid--$7 million this year, $36 million planned over the next 4 years--Colombia is undertaking a major judicial reform program to protect judges, increase the effectiveness of investigators and prosecutors, improve the administration of the court system, and develop new laws and regulations. The leaders of the Medellin cartel are now either in prison or dead. The surrender of Pablo Escobar and his top lieutenants is an impressive achievement. As little as a year ago, no one would have believed it possible. Colombia's judicial system now faces the test of prosecuting and convicting Escobar, and winning a jail sentence commensurate with his crimes. Peru faces a difficult situation because of the complexity of its problems. Facing an economic crisis and two terrorist movements, its performance is not always what we would like to see. Even so, the [Alberto] Fujimori Administration has publicly committed itself to fight the narcotics traffickers and their insurgent allies. Last May, we signed an umbrella agreement with Peru to set the framework for our overall counter-narcotics effort. Last week, we signed specific agreements to implement the economic and law enforcement parts of that effort. There has been some progress. In 1990, Peruvian Government forces destroyed (in coca seedbeds) the equivalent of over 15,000 hectares of mature coca, dismantled 151 coca base labs, and completed the Santa Lucia base. Eight tons of cocaine and cocaine base were seized in 1990, up from less than a ton the year before. And this year, the Peruvian Air Force has repeatedly staged aircraft at Santa Lucia for flight interdiction operations. In the last 2 months alone, 47 unscheduled aircraft were forced down, three carrying narcotics. We are receiving reports that trafficker pilots are now demanding large bonus payments to fly into the Upper Huallaga Valley. In Bolivia, we have seen successes in several areas. Eight thousand hectares of coca were eradicated last year. A major trafficking network was dismantled last year, and its leader, "Meco" Dominguez, was arrested. When questions about ties to narcotics traffickers were raised about some top government appointees, President Paz Zamora accepted the resignations of his top counter- narcotics official as well as the interior minister and chief of police. Last June, a major raid in the town of Santa Ana, an area that had been considered out of reach of law enforcement officials, yielded the arrest of one top narcotrafficker and the seizure of assets of many others. This raid contributed to the July 9 surrender of Erwin Guzman, one of Bolivia's largest traffickers. Bolivia also has achieved an important success in agricultural development. Bolivia's Chapare Valley is an area where, in recent years, unemployed workers--up to three-fourths of the male work force--have migrated to coca regions to earn money cultivating coca. One year ago, the Chapare produced no legal exports at all. Today, with our economic aid, new crops are now being grown in the Chapare Valley, and, as a result this year almost no workers left the valley to work in coca-growing areas. The crops include pineapples which are being exported to Argentina, bananas to Chile, turmeric to Argentina and Venezuela, and passion fruit for the local market. Ecuador virtually wiped out its fledgling coca growing industry in the mid-1980s and continues to eradicate any coca found. Ecuador has enacted a comprehensive drug law which toughens sentences for drug crimes and criminalizes drug-related activities, including bribery and intimidation of enforcement and judicial officials, lending assets for use in drug production or transport, and money laundering. We have provided Ecuador with technical assistance on chemicals control, money laundering, and intelligence to help implement the law. In the last year, Ecuador has eradicated 30 hectares of coca and seized over a ton of cocaine and cocaine base. Last month we completed negotiations with Ecuador on a money-laundering control agreement. The Borja Government has publicly condemned and dismissed from office public officials and judges suspected of corruption in drug crimes.
Building Alternatives to the Cocaine Economy
In large part, the drug war is an effort to change incentives and behavior throughout the chain of production and consumption. The more we convince users and traffickers of the likelihood they will serve time in jail, the likelier they are to opt out of illegal activity. When we interrupt supplies, we raise producers' cost of doing business and the price users pay for drugs. And, as I mentioned earlier, the Andean nations' success in disrupting cocaine production has caused an oversupply of leaf and paste and, hence, lower prices for coca leaf. That begins to tilt the incentive for farmers toward legal crops and away from coca. For our policy to succeed, we need to be ready to deal with those who respond to new incentives. That means providing treatment to former drug users, it means dealing with drug traffickers who want to abandon their trade, and it means having economic alternatives ready for farmers who are ready to abandon coca and grow legal crops. At the Cartagena summit in February 1990, President Bush heard an appeal not primarily for aid but for increased trade. The Andean presidents strongly requested new trade opportunities to create new, legal sources of employment and foreign exchange to permanently displace the cocaine economy in their countries. The Andean Trade Preference Act (ATPA) responds to that need. It is modeled after the CBI, creating broad categories of goods that will enjoy 10 years of preferential treatment (reduced or eliminated tariffs) in the US market. It excludes the same sensitive sectors that are excluded from CBI. ATPA would complement economic development programs we now have in place in the Andean region. These programs received a major boost with the completion last December of a US Government study of the problems facing agricultural development in the Andes. An inter-agency task force, led by former Ambassador Edwin Corr, traveled to the region and made a series of recommendations that have been translated into an action plan by the [US] Agriculture Department and the US Agency for International Development. This includes measures to improve pest and disease control, to increase knowledge of product marketing, to help Andean farmers meet US regulatory standards and to improve infrastructure in rural areas. The impact of these measures will be multiplied once new trade preferences are enacted. Based on the experience of CBI, we would expect ATPA to lead to more exports of the products the Andean countries currently sell to the United States and to the development of new lines of exports to take advantage of duty-free treatment. About $300-million worth of Andean products now charged duties would become duty- free. These products include cut flowers, some fruits and vegetables, zinc, and some seafood. New exports would most likely come in sectors such as agriculture, aquaculture, and ceramic goods. Countries receiving CBI benefits have increased their non- traditional exports about 15% annually since the program began in 1983. It is impossible to exaggerate how badly these countries need new opportunities for economic development. They need to diversify their exports. More than 90% of Bolivian and Ecuadorian exports are primary commodities like fuel, minerals, bananas, and coffee. The percentage for Colombia and Peru is over 75%. In Colombia, the damage caused by guerrillas cost $376 million, the equivalent of 1 percent of gross domestic product, in the first quarter of this year alone. Peru is struggling with massive international debt, a combined rate of unemployment and underemployment of 86 % in the capital city of Lima, and a cholera epidemic that has afflicted some 220,000 Peruvians. These countries are doing the right things to put their economies in order and to establish the basis for economic growth. Bolivia has been implementing market-oriented reforms since 1985. Last year, Colombia began an ambitious program to open up its economy to foreign trade and investment. Under President Fujimori's leadership, Peru began an economic reform program which the World Bank has called the most thorough in Latin America in the post-war era.
ATPA's Impact on the US Economy
This legislation is designed to give special help to our key partners in the war on drugs at a time when their economies are in dire need. Its greatest impact, and the greatest benefit to the United States, will be measured in the counter-narcotics arena. However, the Administration has given careful consideration to ATPA's impact on the US economy. We believe these trade preferences will carry little or no adverse impact, and we see the potential for economic benefits in the form of increased US exports to the Andean region. Andean exports are not of sufficient weight in US trade to have a major economic impact. They account for less than 1% of US imports. Their value is about $5 billion, of which $2 billion is in petroleum, a product excepted from ATPA treatment. ATPA would give duty-free treatment to products that now account for $300 million of Andean exports to the United States. Worldwide, we import $9 billion worth of these products. Favorable tariff treatment for the Andes could result in a greater Andean share of that $9 billion, as US importers respond to lower prices of Andean products. Rather than an overall increase in US imports, we may see a shift among suppliers. Moreover, the CBI experience and recent trade patterns throughout the hemisphere show that we can generally expect to sell more to countries that sell more to us. When CBI began in 1983, we had a $3.3 billion trade deficit with CBI countries. Within 3 years, the deficit disappeared. By 1990, US exports to CBI countries had grown 72% (to $9.5 billion), and our deficit turned into a $2-billion surplus. Looking at the hemisphere's economy as a whole, we see a general pattern where our exports increase as our neighbors grow more prosperous. The region's economic problems in the early 1980s caused a sharp drop in US exports, from $42 billion in 1981 to $26 billion in 1983. As the region's economy recovered, our exports rose to $49 billion in 1989 and $55 billion in 1990. Moreover, our market share increased. In 1980, we sold half the exports to Latin America and the Caribbean; in 1989, we sold 56%. Given our competitive and geographical position, the US economy can only gain from greater prosperity in this hemisphere. The data bear this out.
Conclusion
The Andean Trade Preference Act is clearly in our national interest. It will fulfill an important commitment to our allies in the war on drugs. It will build on our economic development efforts and draw resources away from the cocaine cartels. In the long run, it is likely to help the US economy as the Andean nations acquire a greater capacity to buy US exports. For these reasons, the Administration strongly urges this committee and the Congress to help our key allies to prosecute the drug war by approving H.R. 661. (###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

Looking Forward to a New South Africa

Cohen Source: Herman J. Cohen, Assistant Secretary for African Affairs Description: Statement before the Subcommittees on Africa and on International Economic Policy and Trade, House Foreign Affairs Committee, Washington, DC Date: Jul 31, 19917/31/91 Category: Speeches, Testimony, Statements Region: Subsaharan Africa Country: South Africa Subject: Human Rights, Trade/Economics, Regional/Civil Unrest [TEXT] Thank you for inviting me to come before this hearing of the two subcommittees. I appreciate the opportunity to continue our dialogue on South Africa. Since I last testified before you on April 30, progress toward non-racial democracy in South Africa has continued. In June, the Group Areas Act, the Population Registration Act, and the Land Acts were repealed by Parliament. In early July, the ANC [African National Congress] held its first major conference inside South Africa in 30 years and gave Nelson Mandela, its newly elected president, a mandate to move ahead with constitutional talks. Prisoner releases continued; over 1,000 prisoners have been released under an agreement between the ANC and the government, as well as many more under a recent remission of sentences. On July 10, President Bush signed Executive Order 12769 terminating sanctions pursuant to the Comprehensive Anti- Apartheid Act (CAAA) of 1986 . In doing so, he concluded that the South African Government had met all five of the conditions set forth in Section 311(a) of the act. I would like to summarize the basis for the President's determination. President Bush acted in full conformity with the purposes of Section 311 and of the CAAA as a whole. The language, structure, and legislative history of the act show that the possibility of lifting sanctions was intended as an incentive for the South African Government to create the conditions for good faith negotiations by taking the five specific steps listed in Section 311(a). Lifting sanctions was not intended as a reward to be withheld until the apartheid system had been completely eliminated, which would require adoption of a new constitution. The intent of Congress in 1986 was clearly expressed during House consideration of the bill that became the CAAA. As one member stated during that debate, "the incentives and sanctions work together to provide a carrot and stick approach. . . . The incentives provided in the legislation are directed toward those very necessary first steps that the South African Government must take to end apartheid and bring about needed reform." We are very concerned by the recent revelations and allegations concerning the South African Government, including the funding of Inkatha activities, covert South African funding to parties during the Namibian elections, and alleged complicity of members of the security forces in the violence. We are following these developments closely and will take appropriate action. However, this does not lessen our conviction that an irreversible process of change is occurring in South Africa. Let me now address each of the conditions in the act. -- The first condition required the South African Government to release from prison Nelson Mandela and "all persons persecuted for their political beliefs or detained unduly without trial." This standard is consistent with the criteria we have long applied in our annual human rights reports. It is different from the much broader criteria approved by the South African Government and ANC for defining "political prisoners" under the Pretoria Minute. Unlike the Pretoria Minute, the CAAA criteria exclude persons incarcerated after receiving due process, even if the offense was politically motivated. In light of the text, purpose, and legislative history of Section 311, we also concluded that it applies to prisoners who are detained by the South African Government but not to persons who may be held by other entities, be it the ANC or the authorities in the so-called "independent" homelands. This interpretation of the CAAA does not prejudice our firm policy against recognition of these four pseudo-states, which must be re-integrated into the democratic, non-racial South Africa that emerges from negotiations. Although the release of prisoners in the homelands is not required by Section 311, I wish to emphasize that we have consistently urged the South African Government to bring its full influence to bear in resolving this issue, specifically in Bophuthatswana. I do so again, publicly, today. In late June, our Embassy in Pretoria completed an exhaustive review of persons incarcerated by the South African Government. The Embassy had solicited the views of the ANC, PAC [Pan Africanist Congress], AZAPO [Azanian People's Organization], the Human Rights Commission, the ICRC [International Committee of the Red Cross], and other organizations, and had asked for names of alleged political prisoners. Our personnel were granted complete access to South African prison records and reviewed the basis for the conviction and continued detention of each of the over 5,000 prisoners who had applied for release under the Pretoria Minute as well as all other identifiable prisoners whose names appeared on any of the lists we had received. Cases that the ANC and PAC identified as of special interest were given particularly close scrutiny. Upon completion of this extensive review, the Embassy concluded that the South African Government held no prisoners or detainees who met the criteria of Section 311(a). -- The second condition in Section 311(a) required the South African Government to repeal the state of emergency in effect in 1986. The government did so in 1990. This second condition also required the release of all detainees held under the state of emergency. These detainees have been freed, as confirmed by the South African Human Rights Commission. -- The third condition in Section 311(a) required the South African Government to unban democratic political parties and permit South Africans of all races to form political parties, express political opinions, and otherwise participate in the political process. Political parties were unbanned following President de Klerk's speech to Parliament on February 2, 1990. Since then, South Africans of all races have freely exercised the right to form parties (including the ANC, PAC, AZAPO, and South African Communist Party) and to express political opinions (including strident denunciations of the government). Some have asserted that this third condition requires that black South Africans be given the right to vote. A new constitution which will give all South Africans the right to vote must be the outcome of negotiations, but was not a condition of the CAAA. -- The fourth condition in Section 311(a) required the South African Government to repeal the Population Registration Act and Group Areas Act and "institute no other measures with the same purposes." In June, the government repealed the two laws. The transitional measures contained in the repeal legislation were limited solely to maintain the existing constitution until a new constitution is adopted. The population register was "frozen" as of the date of repeal of the Population Registration Act, and no racial information will be entered for newborns or added for other persons in the future. Similarly, the residential standards provisions adopted in connection with the repeal of the Group Areas Act are zoning rules, not unlike those that exist throughout the United States, and expressly prohibit racial discrimination. -- The fifth condition in Section 311(a) required that the South African Government agree to enter into good faith negotiations with truly representative members of the black majority without preconditions. It has done so. Some critics have challenged the government's "good faith" in the negotiating process. We are firmly convinced that President de Klerk and his government are committed to achieving non-racial democracy in South Africa, that they know that there can be no turning back to the policies of apartheid and white privilege, and that they approach the coming negotiations in good faith and with the full intention that they succeed. The action taken by President Bush on July 10 resulted in the termination of the measures in title 3 of the CAAA, of two other CAAA provisions, and of the Rangel amendment denying foreign tax credits with respect to South African income. A number of other South Africa sanctions remain in place. These include the UN embargoes on arms exports and imports, the prohibition of exports to the South African military and police, the Gramm amendment restricting US support for IMF [International Monetary Fund] drawings by South Africa, the ban on intelligence cooperation, and the Fair Labor Standards Program that applies to US firms employing more than 25 persons in South Africa. It is our intention to monitor further developments in South Africa carefully and to consider, in consultation with Congress, the appropriateness of lifting or amending particular measures as the situation warrants. We will act in strict compliance with all requirements of existing legislation and Security Council resolutions. The pre-negotiations phase in South Africa is coming to an end. An all-parties conference proposed by the ANC should soon commence, paving the way for a new constitution. Widespread agreement already has emerged that South Africa's new, non-racial constitution must provide for one person, one vote on a common voters' roll in a multiparty democracy, with equal rights and privileges enshrined in a justifiable bill of rights. This represents a striking degree of convergence of views on fundamental elements of the post-apartheid system. Many of you have expressed concern that the lifting of sanctions will take the pressure off the South African Government to move forward with constitutional talks. But the clock cannot be turned back. While sanctions have played a role in encouraging the South African Government to move ahead with reforms, an irreversible process of dismantling apartheid is now underway. There is no viable alternative to negotiating a non-racial, democratic constitution. President de Klerk and his governing party have acknowledged that there can never be another general election which excludes the majority of South Africa's citizens because of race, and the ANC has agreed to give up the armed struggle for the negotiating table. South Africans have already begun to feel the positive effects of reforms, manifested by a dramatic increase in diplomatic ties, decisions to lift EC [European Community] and other international sanctions, increased trade, re-admittance to the Olympic games, and the goodwill displayed toward President de Klerk during his widespread travels throughout Africa and overseas. These steps by the international community have not made the South African Government complacent; rather, they have spurred further reform measures. Moreover, increasing acceptance overseas has strengthened President de Klerk's support among white South Africans--support which will be crucial for a successful, peaceful settlement. In its efforts to clear the way for constitutional talks, the South African Government has not been bound by the requirements of our sanctions legislation. In addition to the repeal of the two pillars of apartheid cited in the CAAA, the Population Registration Act and the Group Areas Act, Parliament also has repealed the Land Acts, the Separate Amenities Act, and other legislation. The government also has released many prisoners who do not meet the CAAA criteria. Clearly, the government has not merely been ticking off items on a CAAA checklist but is operating according to its own reform and negotiating agenda. The termination of CAAA sanctions does not at all lessen our commitment to support the creation of non-racial democracy in South Africa. While the process of change in South Africa is primarily an internal one, we are supporting these efforts through a balanced policy of frequent contacts with all parties. President Bush has met with President de Klerk, Nelson Mandela, Mangosuthu Buthelezi and other key South African political leaders. He has used these occasions to encourage them to go forward into negotiations and to do everything possible to advance the prospects of peaceful change in South Africa. The President remains in direct contact with President de Klerk and Mr. Mandela to keep them apprised of developments in US policy and to seek their assessment of progress in South Africa. The President also has pressed all parties to work together to find a mutually agreeable means of dealing with the tragic problem of violence which has taken an enormous human toll and distracted energy and attention from the all-important process of negotiations on South Africa's political future. Lastly, the eagerness of South Africans across the political spectrum to draw on our political system and our experiences as they endeavor to establish their own non-racial democracy ensures a continuing US role. We have not hesitated to state forcefully our concerns to any party engaged in actions detrimental to negotiations, including, most recently, revelations of covert South African Government financial support to Inkatha. Such actions could seriously undermine the integrity of the negotiating process. The South African Government must provide a full account of its activities in this regard and take appropriate action against those responsible. We are closely monitoring the South African Government's response to this development. We also urge the South African Government to finalize an agreement with the UNHCR [UN Human Rights Commission] so that the return of South Africa's tens of thousands of exiles can move ahead more rapidly. We have announced our intention to pledge $4 million to a UNHCR repatriation effort. We will continue to press actively for further measures to redress 40 years of legalized discrimination and isolation. Much more must be done to address the basic human needs of the black majority. The beginning of a new South Africa lends particular urgency to efforts to prepare disadvantaged South Africans to participate fully in the revitalization of the economy and assume future leadership positions. To this end, the President directed this month that financial assistance to South Africa's black majority should be doubled from $40 million to $80 million. The current assistance program in South Africa is designed to prepare representatives of the black majority for leadership in the post- apartheid South Africa. We plan to focus the additional $40 million on housing and education. We will work to develop and support credit and financing programs for home ownership for black South Africans. Our current education program will be expanded to include scholarships for secondary education, and vocational training and adult literacy programs. My colleagues and I look forward to working with Congress to make sure this increased assistance is disbursed rapidly and effectively. Termination of sanctions will stimulate the economic growth which is essential to providing jobs and allowing South Africa to address the gross economic inequalities which are the tragic legacy of apartheid. Those who oppose the lifting of sanctions, including many state and local governments which have imposed their own measures, should bear in mind that the burden of continued sanctions will fall particularly on the future non-racial, democratically elected government which will emerge from negotiations. Inevitably, there will be a considerable lag between the end of sanctions and substantial external contributions to economic growth in South Africa. Deprived of the resources generated by growth, the future majority government will be less well equipped to address the aspirations of its people to overcome the damage done by 4 decades of apartheid. CAAA sanctions were one facet of a comprehensive US approach toward South Africa. Our goal remains firm and unswerving--to encourage broad-based negotiations toward the establishment of a non-racial, multi-party democracy in South Africa, with a constitution which enshrines individual rights and establishes the legal basis for a viable, market-based economy. The role of the United States in helping bring about democracy in South Africa will continue to be an active one. The Administration looks forward to continuing to work with Congress in bipartisan efforts aimed at furthering peaceful democratic change in South Africa.(###)
US Department of State Dispatch, Vol 2, No 31, August 5, 1991 Title:

Gulf Responsibility-Sharing

McAllister Source: Eugene J. McAllister, Assistant Secretary for Economic and Business Affairs Description: Statement before the House Ways and Means Committee, Washington, DC Date: Jul 31, 19917/31/91 Category: Speeches, Testimony, Statements Region: MidEast/North Africa Country: Kuwait, Greece, Portugal, Yugoslavia (former), Germany, Japan, South Korea, Saudi Arabia, United Arab Emirates Subject: Military Affairs Thank you for the opportunity to testify today on Gulf responsibility-sharing efforts. We believe that our efforts to assure a fair responsibility-sharing among our allies and partners were an unprecedented success. -- Over $70 billion in total financial commitments was raised. This $70 billion in extraordinary spending is greater than the GDP of a number of countries, including Greece, Portugal, and Yugoslavia. -- In the sphere of economic assistance, 26 countries have committed $16 billion in 1990 and 1991, mainly for those front- line states critical to the sanctions regime, notably Egypt and Turkey. This effort has been coordinated through the US led Gulf- Crisis Financial Coordination Group. -- In military responsibility- sharing, our partners have committed $54 billion to the United States: $9.7 billion in 1990, or 73% of the $13.2 billion in 1990 incremental costs; and $44.2 billion for 1991 incremental military costs. -- In addition, contributors to responsibility-sharing have assisted our military partners. Germany, for instance, provided $822 million to the United Kingdom, and Japan provided $330 to the UK. Gulf states--Kuwait, Saudi Arabia, and the United Arab Emirates--have provided more than $5 billion to support our military partners. Let me briefly describe the status of Desert Shield/Desert Storm contributions to the United States. --- Germany has disbursed all of its Desert Shield/Storm commitments. Germany's strong commitment to responsibility- sharing was demonstrated by its very rapid disbursements of military financing in support of Desert Shield and Desert Storm. Chancellor Kohl committed $5.5 billion for Desert Storm. Two months later, all of that committed funding had been deposited in the defense cooperation account. --- Japan has disbursed all of its 1991 commitments, and we are concluding the final accounting of 1990 disbursements. --- Korea, in recognition of its global responsibilities, also contributed financially to offset our costs and has disbursed $220 million of its $355- million Desert Shield/Storm commitments. The remaining account consists of in-kind support for which delivery is being arranged. --- The United Arab Emirates has disbursed all of its $4- billion 1990 and 1991 Desert Shield/Storm commitments. --- Kuwait has met all of its 1990 Desert Shield commitments. Kuwait also has disbursed $10 billion of its 1991 Desert Storm commitments. --- Saudi Arabia has disbursed $12.7 billion of $16.8 billion in Desert Shield/Storm pledges. This is the largest amount for both disbursements and pledges of any country. In summary, the United States has received $46 billion, or 85%, of the $54 billion in total commitments. We are confident that we will receive all of the commitments in a timely manner. (###)