US Department of State Dispatch,
Vol 3, No 14, April 6, 1992
Title: Efforts To Aid New Independent States At
'Defining Moment in History'
Bush
Source: President Bush
Description: Excerpts from remarks at a news conference, Washington,
DC
Date: Apr, 1 19924/1/92
Category: Speeches, Testimony, Statements
Region: Eurasia
Country: USSR (former), Armenia, Azerbaijan, Belarus,
Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan,
Turkmenistan, Ukraine, Uzbekistan
Subject: Trade/Economics, Democratization
[TEXT]
I have a statement that is a little longer than the normal, but let me just
say that I have just met with the congressional leadership to request their
bipartisan backing for a new, comprehensive, and integrated program to
support the struggle of freedom underway in Russia, Ukraine, and the other
new states that have replaced the
Soviet Union.
The revolution in these states is a defining moment in history with profound
consequences for America's own national interests. The stakes are as high
for us now as any that we have faced in this century. Our adversary for 45
years, the one nation that posed a worldwide threat to freedom and peace, is
now seeking to join the community of democratic nations.
A victory for democracy and freedom in the former USSR creates the
possibility of a new world of peace for our children and grandchildren. But
if this democratic revolution is defeated, it could plunge us into a world
more dangerous, in some respects, than the dark years of the Cold War.
America must meet this challenge, joining with those who stood beside us
in the battle against imperial communism--Germany, the United Kingdom,
Japan, France, Canada, Italy, and other allies. Together we won the Cold
War, and today we must win the peace.
This effort will require new resources from the industrial democracies but
nothing like the price we would pay if democracy and reform failed in
Russia and Ukraine and Byelarus and Armenia and the states of Central Asia.
It will require the commitment of [a] united America, strengthened by a
consensus that transcends even the heated partisanship of a presidential
election campaign.
Today, I call upon Congress--Republicans and Democrats alike--and the
American people to stand behind this united effort.
Our national effort must be part of a global effort. I've been in contact with
[German] Chancellor Kohl, [UK] Prime Minister Major, [French] President
Mitterrand, [and] other key allies to discuss our plans and to assure them of
the high priority I place on the success of this endeavor. To this end, I
would like to announce, today, a plan to support democracy in the states of
the former Soviet Union.
This is a complex set of issues which took months to sort out; working
within the Administration, working with our major allies, and with the
leaders of the new independent states of the former Soviet Union. A number
of things had to come together to make sure we got it right.
Let me give you a little bit of the history. I asked Secretary Baker to
outline our fundamental approach in his December 12 speech at Princeton
[see Dispatch, Vol. 2, No. 50, December 16, 1991]. I spoke again on the need
to embrace Russia and the other new states of the former Soviet Union in
my January 22 speech at the Washington conference to coordinate the
humanitarian assistance.
On February 1, [Russian Federation President] Boris Yeltsin and I discussed
these issues at Camp David. That same day, Secretary Brady met with Boris
Yeltsin's key economic adviser, Igor Gaydar, to discuss how we could
support Russian reforms.
A week later, Jim Baker followed up during his meeting with Kozyrev--
[Russian] Foreign Minister Kozyrev--and Boris Yeltsin in Moscow. Just
yesterday, the International Monetary Fund [IMF] reached tentative
agreement with Russia on its market reform program. After weeks of
intensive consultations in the G-7 [Group of 7 industrialized nations],
Chancellor Kohl--currently serving as chairman of the G-7--has announced,
today, G-7 support for an IMF program for Russia.
The program that I'm announcing today builds on this progress and includes
three major components:
First, the United States has been working with its Western allies and the
international financial institutions on an unprecedented multilateral
program to support reform in the newly independent states. The success of
this program will depend upon their commitment to reform and their
willingness to work with the international community.
Russia is exhibiting that commitment. I'm announcing, today, that the
United States is prepared to join in a substantial multilateral financial
assistance package in support of Russia's reforms. We are working to
develop, with our allies and the IMF, a $6-billion currency stabilization fund
to help maintain confidence in the Russian ruble. The United States will
also join in a multilateral effort to marshal roughly $18 billion in financial
support in 1992 to assist Russian efforts to stabilize and restructure their
economy. We have been working with the Russian Government for 3 months
to help it develop an economic reform plan to permit the major
industrialized countries to provide support.
We will work to complete action on this approximately $24-billion package
by the end of April. I pledge the full cooperation of the United States in this
effort.
Secondly, the United States will also act to broaden its own capacity to
extend assistance to the new states. I am transmitting to Congress a
comprehensive bill, the FREEDOM [Freedom for Russia and Emerging Eurasia
Democracies and Open Markets] Support Act, to mobilize the executive
branch, the Congress and, indeed, our private sector around a comprehensive
and integrated package of support for the new states.
Now, this package will authorize a US quota increase of $12 billion for the
IMF, which is critical to supporting Russia and the other new states. The
IMF and World Bank will be the primary source of funding for the major
financial assistance needs of the new governments. The US quota increase
for the IMF was specifically assumed in the budget agreement and does not
require a budget outlay.
[It will] support my existing authority to work with the G-7 and the IMF to
put together the stabilization program for Russia and support possible
subsequent programs for other states of the former Soviet Union as they
embarked on landmark reforms, including up to $3 billion for stabilization
funds.
It would also repeal restrictive Cold War legislation so that American
business can compete on an even footing in these new markets. I am
determined that American business be given the chance to invest and trade
with the new states. And to that end, I've also directed that the United
States negotiate trade and bilateral investment and tax treaties with these
countries just as soon as possible. Significant new trade relationships can
create jobs right here in this country.
The package will broaden the use of $500 million appropriated by Congress
last year to encompass not only the safe dismantling and destruction of
nuclear weapons but also the broader goals of nuclear plant safety,
demilitarization, and defense conversion. It will also establish a major
people-to-people program between the United States and the states of the
former Soviet Union to create the type of lasting personal bonds among our
peoples and Russian understanding of democratic institutions so critical to
long-term peace.
This effort will complement our existing programs to bring hundreds of
businessmen to the United States from the Commonwealth [of Independent
States] and then send hundreds of Peace Corps volunteers to the new states.
In sending this authorization legislation to Congress, I call upon the
Congress to act concurrently to provide the appropriations necessary to
make these authorizations a reality.
Third, in addition to the $3.8 billion already extended by the United States
since January 1991, I'm announcing today $1.1 billion in new Commodity
Credit Corporation [CCC] credit guarantees for the purchase of American
agricultural products. Six hundred million of that will go for US sales to
Russia and an additional $500 million for US sales to the Ukraine and other
states.
Now, let me close on a personal note. I think every day about the challenge
of securing a peaceful future for the American people. And I believe very
strongly that President Yeltsin's reform program holds the greatest hope for
the future of the Russian people and for the security of the American people
as we define a new relationship with that great country.
President Yeltsin has taken some very courageous steps for democracy and
free markets. I am convinced that it is in our own national interest to
support him strongly.
For more than 45 years, the highest responsibility of nine American
presidents--Democrats and Republicans--was to wage and win the Cold War.
It was my privilege to work with Ronald Reagan on these broad programs and
now to lead the American people in winning the peace by embracing the
people so recently freed from tyranny to welcome them into the community
of democratic nations.
I know there are those who say we should pull back: concentrate our
energies, our interests, and our resources on our pressing domestic
problems--and they are very important. But I ask them to think of the
consequences here at home of peace in the world. We've got to act now. If
we turn away, if we do not do what we can to help democracy succeed in the
lands of the old Soviet Union, our failure to act will carry a far higher price.
If we face up to the challenge, matching the courage of President Yeltsin, of
Ukrainian President Kravchuk, of Armenian President Ter-Petrosyan, many
other future generations of Americans will thank us for having had the
foresight and the conviction to stand up for democracy and work for peace in
this decade and into the next century.
That's the end of this statement. I'll be glad to take just a handful of
questions, and then Jim Baker and Secretary Brady--I think Secretary
Baker--will go into more detail on the legislation, and Secretary Brady and
others will be available. I think Ed Madigan will talk to you about the
agricultural sect[ion] of it.
Dispatch, Vol 3, No 14, April 6, 1992
Title: Efforts To Aid New Independent States At
'Defining Moment in History'
Baker
Source: Secretary Baker
Description: Excerpts from remarks at a news conference, Washington,
DC
Date: Apr, 1 19924/1/92
Category: Speeches, Testimony, Statements
Region: Eurasia
Country: USSR (former), Armenia, Azerbaijan, Belarus,
Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan,
Turkmenistan, Ukraine, Uzbekistan
Subject: Trade/Economics, Democratization
[TEXT]
Let me make a couple of brief comments, and then I'd be glad to try and
respond to your questions, as I know [Treasury] Secretary Brady would.
First of all, you heard the President in his opening remarks mention that
this is, in effect, a three-part program; it's a three-way approach.
First, you have a multilateral component of this which has to do with the
agreement among the G-7 to provide $24 billion in support for Russia. That
applies to the Russian Federation.
Second, you have the Freedom for Russia and Emerging Eurasian Democracies
and Open Markets Support Act of 1992, which we are going to call the
FREEDOM Support Act and which we are today sending to the Congress in
legislative form, together with fact sheets, in the hopes that Congress will
join with us in what you've heard the President characterize as a very, very
important national imperative.
This bill is very comprehensive. It is very broad. It is very far-reaching,
and it is our view that it will help mobilize support not just among the
legislative branch but among the US public as well.
This is, in our view, a once-in-a-century opportunity that we cannot miss.
We spent trillions of dollars to win the Cold War, and we ought to be willing
to spend a few billion dollars to secure the peace, or we might find
ourselves in the position of having to spend far more again if things go in
the wrong direction over there. And this is, therefore, a very important
national security issue. And it is an issue that is very important to the
American people.
The third element of the program you heard the President mention is the
provisioning of additional CCC credits to an amount of about $1.1 billion--
$600 million of that destined for the Russian Federation; $500 million for
the other former republics of the former Soviet Union.
I'll be glad to give you some detail, if you want it, on the bill. Let me
simply
say that it is a 10-point plan, a comprehensive one, as I've mentioned, that
speaks to the provisioning of additional humanitarian assistance; that talks
to the issue of nuclear safety and responsibility. It expands assistance
opportunities in building free markets. It increases support for democratic
institutions in these new countries. It improves access to credits for
purchases of food. It stimulates greater trade and investment opportunities
for and with these new countries. It supports in many ways the
development of a private sector. It leverages our financial contributions
through the IMF. It points up the importance to the United States and to this
issue of moving on the quota increase for the IMF. It supports US leadership
in developing a stabilization fund or funds for these newly emerging nations
up to an amount of $3 billion, and it expands the American presence on the
ground in Russia and the new states and their presence here. And opens up
quite a few opportunities for person-to-person contact.
There's only one other thing I want to say, and then I'm glad to respond to
your questions--Nick [Brady] may have something he wants to say before we
get to that--and that is picking up on the questions that were asked of the
President about why now. This is not a recent effort. We have been doing
this for not just a period of months but indeed, I would argue, a period of
years--that's supporting the historic transformations that are taking place
in the former Soviet Union. Transformations in which Americans have a
very major stake.
Indeed, as the President mentioned, I said in my speech at Princeton last
December 12: "As we organized an alliance against Stalinism during the
Cold War, today America can mobilize a coalition in support of freedom."
That's what we're doing.
We've also said over the course of the past several months that the first
step, of course, was to match outside support with self-help. And it has
been recently, in the last few months, that we've seen Russia, particularly,
move in the area of adopting credible economic reform programs.
We began with humanitarian and technical assistance. You will remember
the coordinating conference in January in which we involved many, many
other nations and through which we provided a substantial amount of
humanitarian assistance to these new states. We will have follow-up
coordinating conferences to be hosted by other countries.
By the beginning of 1992, we had already pledged over $5 billion in
assistance as well as having held a coordinating conference.
The time, we think, to mobilize American public support for this--and we
don't underestimate the responsibility that that is and the job that is before
us--is now. We think that this is a way in which we can integrate our
efforts across the board and in which we can coordinate American
contributions with the contributions of many, many other governments. Now
is the time, we think, to catalyze congressional action, and now is
particularly the time for us to send a very powerful signal to the democrats
and reformers in the former Soviet Union who are trying to convert to
democracy, freedom, and free markets. . . . (###)
Dispatch, Vol 3, No 14, April 6, 1992
Title: [FREEDOM Support Act of 1992:] Assistance to New
States Of the Former Soviet Union
Bush
Source: President Bush
Description: Legislative proposal transmitted to Congress
Date: Apr, 3 19924/3/92
Category: Speeches, Testimony, Statements
Region: Eurasia
Country: USSR (former), Armenia, Azerbaijan, Belarus,
Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan,
Turkmenistan, Ukraine, Uzbekistan
Subject: Trade/Economics, Democratization
[TEXT]
FREEDOM Support Act of 1992
To the Congress of the United States:
I am pleased to transmit a legislative proposal entitled the "Freedom for
Russia and Emerging Eurasian Democracies and Open Markets Support Act of
1992" (the FREEDOM Support Act of 1992). Also transmitted is a section-
by-section analysis of the proposed legislation.
I am sending this proposal to the Congress now for one urgent reason: With
the collapse of the Soviet Union, we face an unprecedented historical
opportunity to help freedom flourish in the new, independent states that
have replaced the old Soviet Union. The success of democracy and open
markets in these states is one of our highest foreign policy priorities. It
can help ensure our security for years to come. The growth of political and
economic freedom in these states can also provide markets for our
investors and businesses and great opportunities for friendship between our
peoples.
While this is an election year, this is an issue that transcends any election.
I have consulted with the congressional leadership and have heard the
expressions of support from both sides of the aisle for active American
leadership. I urge all Members of Congress to set aside partisan and
parochial interests.
Just as Democrats and Republicans united together for over 40 years to
advance the cause of freedom during the Cold War, now we need to unite
together to win the peace, a democratic peace built on the solid foundations
of political and economic freedom in Russia and the other independent
states.
This proposal gives me the tools I need to work with the international
community to help secure the post-Cold War peace. It provides a flexible
framework to cope with the fast-changing and unpredictable events
transforming Russia, Ukraine, Armenia, and the other states. This proposal
will allow us to:
-- Mobilize fully the executive branch, the Congress, and the private sector
to support democracy and free markets in Russia and the other independent
states of the former Soviet Union;
-- Address comprehensively the military, political, and economic
opportunities created by the collapse of the Soviet Union, targeting our
efforts and sharing responsibilities with others in the international
community; and
-- Remove decisively the Cold War legislative restrictions that hamstring
the government in providing assistance and impede American companies and
businesses from competing fairly in developing trade and investment with
the new independent states.
Passage of this proposal will enable the United States to maintain its
leadership role as we seek to integrate Russia and the other new
independent states into the democratic family of nations. Without the tools
this proposal provides, our policy of collective engagement will be
constrained, our leadership jeopardized.
This proposal has 10 key elements:
First, this proposal provides the necessary flexibility for the United States
to extend emergency humanitarian assistance to Russia and the other new
independent states.
Emergency humanitarian assistance will help the peoples of the former
Soviet Union to avoid disaster and to reduce the danger of a grave
humanitarian emergency next winter. In this endeavor, the United States
will not go it alone but will continue to work closely with the international
community, a process we initiated at the Washington Coordinating
Conference in January and will continue in the months ahead in regular
conferences with our allies. By dividing our labors and sharing our
responsibilities, we will maximize the effects of our efforts and minimize
the costs.
Second, this proposal will make it easier for us to work with the Russians
and others in dealing with issues of nuclear power safety and
demilitarization. This proposal broadens the authority for Department of
Defense monies appropriated last fall for weapons destruction and
humanitarian transportation to make these funds, as well as foreign
military financing funds, available for non-proliferation efforts, nuclear
power safety, and demilitarization and defense conversion.
Third, technical assistance can help the Russians and others to help
themselves as they build free markets. Seventy years of totalitarianism
and command economics prevented the knowledge of free markets from
taking a firm hold in the lands of Russia and Eurasia. By providing know-
how, we can help the peoples and governments of the new independent
states to build their own free market systems, open to our trade and
investment. It will also allow agencies authorized to conduct activities in
Eastern Europe under the "Support for East European Democracy (SEED) Act
of 1989" to conduct comparable but separate activities in the independent
states of the former Soviet Union. Through organizations such as a Eurasia
Foundation, we will be able to support a wide range of technical assistance
efforts.
Fourth, this proposal will allow us to significantly expand our technical
assistance programs that facilitate democratization in the new states,
including our expanding rule of law program. It will authorize support for
programs such as "America Houses." It also provides support for expanded
military-to-military programs with Russia and the other new independent
states to cultivate a proper role for the military in a democratic society.
Fifth, this proposal provides a clear expression of bipartisan support to
continue to extend Commodity Credit Corporation credit guarantees to
Russia and the other new independent states in light of the progress they
are making toward free markets. As they overcome their financial
difficulties, we should take into account their commitment to economic
freedom in providing credit guarantees that will help feed their peoples
while helping American farmers.
Sixth, for American business, this proposal expands authority for credit and
investment guarantee programs such as those conducted by the Overseas
Private Investment Corporation (OPIC) and the Export-Import Bank. It will
allow us to waive statutory ceilings on credit guarantee programs of the
Export-Import Bank Act and other agencies that applied to the Soviet Union
and the restrictions of the Johnson Debt Default Act on private lending. In
this way, it will expand US exports to and investment in Russia and the
other new independent states.
Seventh, this bill will facilitate the development of the private sector in
the former Soviet Union. This bill removes Cold War impediments while
promoting outside investment and enhanced trade. It will also allow waiver
of restrictions on imports from the independent states of the former Soviet
Union beyond those applied to other friendly countries. It will support
efforts to further ease Coordinating Committee (COCOM) restrictions on
high technology. The bill will also allow the establishment of enterprise
funds and a capital increase for the International Financial
Corporation.
Eighth, this proposal will allow the United States to work multilaterally
with other nations and the international financial institutions toward
macroeconomic stabilization. At the end of World War II, the United States
stood alone in helping the nations of Western Europe recover from the
devastation of the war. Now, after the Cold War, we have the institutions in
place--the International Monetary Fund (IMF) and the World Bank--that can
play a leading role in supporting economic reform in Russia and Eurasia.
Therefore, this proposal endorses an increase in the IMF quota for the United
States. This will help position the IMF to support fully a program of
macroeconomic stabilization. I request the Congress to pass both the
authorization and appropriations necessary for this purpose.
Ninth, this proposal endorses a significant US contribution to a multilateral
currency stabilization fund. Working with the international financial
institutions and the other members of the G-7, we are putting together a
stabilization fund that will support economic reform in Russia and the other
independent states.
Tenth, this proposal provides for an expanded American presence in Russia
and the other new independent states, facilitating both government-to-
government relations and opportunities for American business. Through
organizations such as the Peace Corps and the Citizens Democracy Corps, we
will be able to put a large number of American advisers on the ground in the
former Soviet Union.
In sending this authorization legislation to the Congress, I also request
concurrent action to provide the appropriations necessary to make these
authorizations a reality. In order to support fully multilateral efforts at
macroeconomic stabilization, I urge the Congress to move quickly to fulfill
the commitment of the United States to the IMF quota increase. I urge
prompt enactment of the appropriations requests for the former Soviet
Union contained in the FY 1992 and 1993 budget requests presently before
the Congress.
I call upon the Congress to show the American people that in our democratic
system, both parties can set aside their political differences to meet this
historic challenge and to join together to do what is right.
On this occasion, there should be only one interest that drives us forward:
America's national interest.
George Bush
Dispatch, Vol 3, No 14, April 6, 1992
Title: Multilateral Financial Assistance Package for
Russia
Fitzwater
Source: White House Press Secretary Marlin Fitzwater
Description: Statement released by the White House, Office of the
Press Secretary, Washington, DC
Date: Apr, 1 19924/1/92
Category: Speeches, Testimony, Statements
Region: Eurasia
Country: USSR (former), Armenia, Azerbaijan, Belarus,
Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan,
Turkmenistan, Ukraine, Uzbekistan
Subject: Trade/Economics, Democratization
[TEXT]
President Bush today announced US support for a multilateral financial
assistance package to help Russia and the other new states of the former
Soviet Union transform their economies to free market systems. There are
three elements of this program:
-- Roughly $18 billion in financial support in 1992 to help Russia stabilize
and restructure its economy;
-- [A] $6-billion currency stabilization fund to bolster confidence in the
Russian ruble; and
-- Early membership for Russia and the other new states in the
International Monetary Fund (IMF).
The President has urged the G-7 to complete action on this approximately
$24-billion package by the end of April.
Financial Support
The United States is working with its allies and the international financial
institutions to marshal $18 billion in financial assistance in 1992 to
support Russia's economic reform efforts.
Russia is already embarked on the path of bold market-oriented economic
reforms. The reforms taken to date are part of an IMF-endorsed "shadow
program" which does not involve financing. Negotiations are now underway
between Russia and the IMF with the aim of converting the shadow program
as soon as possible into a full and comprehensive reform program which
would merit IMF financial support. These reforms would include reduction
of the budget deficit, curbing inflation, privatization, and reform of the
agricultural and energy sectors.
Eighteen billion dollars in financial support could be obtained from:
-- $11 billion of existing and new bilateral commitments from key
industrial countries, including the United States. Negotiations on specific
contributions are underway among the G-7 countries;
-- $4.5 billion from the international financial institutions, including the
IMF, World Bank, and European Bank for Reconstruction and Development
(EBRD); and
-- The remaining $2.5 billion in deferral of debt payments owed to Western
creditors.
Currency Stabilization Fund (CSF)
An integral part of Russia's reform program is an effort to stabilize the
ruble and bolster the public's confidence in it by making it freely
convertible. To help achieve these objectives, [Russian] President Yeltsin
has requested the creation of a currency stabilization fund.
The major industrial countries recognize that a stable, convertible ruble
would have important benefits for the Russian reform effort. Thus, the
United States and the other major countries are working together to
establish such a fund for Russia.
The fund would total $6 billion, an amount equal to roughly 3 months of
Russia's 1991 hard currency imports. Russian membership in the IMF and
compliance with a formal IMF program would be a precondition for use of
the fund.
The resources for the fund will be financed entirely by activating the IMF's
General Arrangements To Borrow (GAB). The GAB consists of emergency
credit lines to the IMF from the G-7 and other industrial countries. The
United States share of the GAB is 25%. US participation in the GAB and the
funds required for the US contribution have been authorized and appropriated
by Congress. Use of the GAB involves no net US budgetary outlays.
Early Membership in the IMF
Russian and the other new states have applied for IMF membership. The
United States has strongly supported early membership for them to promote
market reforms and forge strong links with the West. Russia as well as
some of the other new states should become members of the IMF by early
May.
The IMF Executive Board is in the final stages of determining Russia's terms
of entry into the Fund, including the size of Russia's quota, which will
establish the basis for Russia's representation, voting power, and access to
IMF resources. The board has agreed upon a 3% Russian quota share, which
will place Russia in the ninth position in the IMF.
It will soon forward membership resolutions to the IMF Board of Governors.
In turn, under standard IMF procedures, the Board of Governors would have
30 days to cast ballots in support of the resolutions. A vote by the Board of
Governors requires a quorum of one-half of IMF members with two-thirds of
the voting power, with approval by a simple majority of those voting.
The President has called for legislation providing for US participation in the
IMF quota increase in order to ensure that the IMF has adequate resources to
meet perspective demands for financing.
Dispatch, Vol 3, No 14, April 6, 1992
Title: Agricultural Assistance for the New Independent
States
Fitzwater
Source: White House Press Secretary Marlin Fitzwater
Description: Statement released by the White House, Office of the
Press Secretary, Washington, DC
Date: Apr, 1 19924/1/92
Category: Speeches, Testimony, Statements
Region: Eurasia
Country: USSR (former), Armenia, Azerbaijan, Belarus,
Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan,
Turkmenistan, Ukraine, Uzbekistan
Subject: Trade/Economics, Democratization
[TEXT]
The President today announced a series of additional measures to assist the
independent states of the former Soviet Union. These include an immediate
increase of $1.1 billion in credit guarantees for the purchase of US
agricultural commodities.
Up to an additional $1.1 billion will be made available under the GSM-102
program. Of this, $600 million will be available to Russia and $500 million
for Ukraine, Armenia, and other states. The Russian guarantees will be
made operational in four monthly tranches beginning on May 1. The other
$500 million will become available to the other republics provided they
meet program qualifications.
The GSM-102 program provides Commodity Credit Corporation (CCC)
guarantees of credit extended by private US banks for the purchase of US
agricultural commodities. The credits are usually repayable over 3 years
with three equal annual installments of principal. The total amount of
credit guarantees made available since January 1991, when the first
allocation for the then-Soviet Union was made, is now $4.85 billion. Russia
and the other republics are fully up to date in repayments to banks of
credits guaranteed earlier by the CCC. Since January 1, 1992, these have
amounted to over $270 million. (###)
Dispatch, Vol 3, No 14, April 6, 1992
Title: OPIC Agreements: US-Armenia
Baker
Source: Secretary Baker
Description: Secretary Baker's remarks at the treaty signing
ceremony with Armenian Deputy Prime Minister Hrant Bagratian,
Washington, DC
Date: Apr, 2 19924/2/92
Category: Speeches, Testimony, Statements
Region: Eurasia
Country: Armenia
Subject: Trade/Economics
[TEXT]
I am delighted to be here with the Deputy Prime Minister of Armenia. We
will be signing two agreements: an OPIC [Overseas Private Investment
Corporation] agreement and a trade agreement. The signing of these two
agreements puts into place the foundation of the US-Armenian economic
relationship. It's important now that we conclude a bilateral investment
treaty and a bilateral tax treaty so as to move the economic relationship
between our two countries forward. We will look forward to working on
those at your earliest convenience.
Let me say finally that this, I think, is the first OPIC agreement that we
have signed with a new state of the former Soviet Union. We are very
pleased to be signing it with Armenia. (###)
Dispatch, Vol 3, No 14, April 6, 1992
Title: OPIC Agreements: US-Armenia
Tutwiler
Source: State Department Spokesman Margaret Tutwiler
Description: Statement, Washington, DC
Date: Apr, 2 19924/2/92
Category: Speeches, Testimony, Statements
Region: Eurasia
Country: Armenia
Subject: Trade/Economics
[TEXT]
Secretary James Baker and Armenian Deputy Prime Minister Hrant Bagratian
signed a bilateral OPIC agreement today at 4:00 pm at the State Department.
This is an executive agreement that does not require congressional approval.
The US-Armenian agreement enables OPIC to provide investment insurance,
project financing, and investor services for US private investors in Armenia.
Armenia is the first of the new independent states on the territory of the
former Soviet Union to sign such an agreement with the United States.
Signature of this agreement demonstrates the commitment of the United
States to help the private sector in Armenia develop and to assist US
companies seeking to invest there. As such, it marks an important step in
establishing normal commercial relations with Armenia.
OPIC is a US Government agency that provides assistance to American
investors in over 120 developing countries and emerging economies
throughout the world. Projects supported by OPIC also create US jobs and
exports and strengthen America's international competitiveness. (###)
Dispatch, Vol 3, No 14, April 6, 1992
Title: OPIC Agreements: US-Russia
Tutwiler
Source: State Department Spokesman Margaret Tutwiler
Description: Statement, Washington, DC
Date: Apr, 3 19924/3/92
Category: Speeches, Testimony, Statements
Region: Eurasia
Country: Russia
Subject: Trade/Economics
[TEXT]
Secretary James A. Baker, III, and Russian Ambassador Vladimir Lukin
signed a bilateral OPIC agreement today at 9:00 am at the State Department.
The US-Russian agreement will enable OPIC to provide investment
insurance, project financing, and investor services for US private investors
in the Russian Federation.
The agreement must now be ratified by the Russian Parliament. It does not
require US congressional approval.
Signature of this agreement demonstrates the commitment of the United
States to help the private sector in Russia develop and to assist US
companies seeking to invest there.
As such, it marks an important step in establishing normal commercial
relations with Russia.
OPIC is a US Government agency that provides assistance to American
investors in over 120 developing countries and emerging economies
throughout the world. (###)
Dispatch, Vol 3, No 14, April 6, 1992
Title: UNSC Resolutions Against Libya
Tutwiler
Source: State Department Spokesman Margaret Tutwiler
Description: Department Statement, Washington, DC
Date: Mar, 31 19923/31/92
Category: Speeches, Testimony, Statements
Region: MidEast/North Africa
Country: Libya
Subject: United Nations, Terrorism
[TEXT]
Once again, the UN Security Council has spoken out for collective action
against state-supported terrorism, in this case the bombings of Pan Am
[Flight] 103 and UTA [Flight] 772 that resulted in the loss of 441 lives.
Today, the UN Security Council adopted a second resolution that will impose
mandatory sanctions on the Government of Libya if Libya fails to comply
with UN Security Council Resolution 731 by April 15. Once sanctions are
imposed, they will remain in effect until the Security Council determines
that Libya has complied fully with the requests referenced in UN Security
Council Resolution 731, which was approved unanimously on January 21.
These require Libya to:
-- Surrender the bombing suspects for trial in the United States or United
Kingdom and accept responsibility for their actions;
-- Disclose all relevant information about the crime;
-- Pay appropriate compensation; and
-- Cease all terrorist actions and support of terrorist groups, which it
must prove by concrete actions.
The sanctions voted by the UN Security Council are specifically related to
Libya's sponsorship of state terrorism, particularly against civil aviation.
The Government of Libya has repeatedly attempted to delay and divert
attention from that fundamental issue: its continuing support for terrorism
and its direct involvement in the two civilian airline bombings.
We repeat that the US Government strongly advises any American citizens
who may be present in Libya to depart immediately. We cannot predict
Libya's response once UN Security Council sanctions are in force. In any
event, once air links are broken, it will be more difficult to leave the
country. US passports have been invalid for travel to Libya since 1981
unless specially endorsed by the US Government. Similarly, any financial
transaction with Libya is prohibited under the provisions of the Libyan
sanctions regulations issued by the Office of Foreign Assets Control of the
Treasury Department.
Resolution 731
UN Security Council resolution of January 21, 1992.
The Security Council,
Deeply disturbed by the world-wide persistence of acts of international
terrorism in all its forms, including those in which States are directly or
indirectly involved, which endanger or take innocent lives, have a
deleterious effect on international relations and jeopardize the security of
States,
Deeply concerned by all illegal activities directed against international
civil aviation and affirming the right of all States, in accordance with the
Charter of the United Nations and relevant principles of international law,
to protect their nationals from acts of international terrorism that
constitute threats to international peace and security,
Reaffirming its resolution 286 (1970) in which it called on States to take
all possible legal steps to prevent any interference with international civil
air travel,
Reaffirming also its resolution 635 (1989) in which it condemned all acts
of unlawful interference against the security of civil aviation and called
upon all States to cooperate in devising and implementing measures to
prevent all acts of terrorism, including those involving explosives,
Recalling the statement made on 30 December 1988 by the President of the
Council on behalf of the members of the Council strongly condemning the
destruction of Pan Am flight 103 and calling on all States to assist in the
apprehension and prosecution of those responsible for this criminal act,
Deeply concerned over results of investigations which implicate officials of
the Libyan Government and which are contained in Security Council
documents that include the requests addressed to the Libyan authorities by
France, the United Kingdom of Great Britain and Northern Ireland and the
United States of America in connection with the legal procedures related to
the attacks carried out against Pan Am flight 103 and UTA flight 772
(S/23306*; S/23307*; S/23308*;
S/23309*; S/23317),
Determined to eliminate international terrorism,
1. Condemns the destruction of Pan Am flight 103 and UTA flight 772 and
the resultant loss of hundreds of lives;
2. Strongly deplores the fact that the Libyan Government has not yet
responded effectively to the above requests to cooperate fully in
establishing responsibility for the terrorist acts referred to above against
Pan Am flight 103 and UTA flight 772;
3. Urges the Libyan Government immediately to provide a full and effective
response to those requests so as to contribute to the elimination of
international terrorism;
4. Requests the Secretary-General to seek the cooperation of the Libyan
Government to provide a full and effective response to those requests;
5. Urges all States individually and collectively to encourage the Libyan
Government to respond fully and effectively to those requests;
6. Decides to remain seized of the matter.
VOTE: Unanimous 15-0.
Resolution 748
UN Security Council resolution of March 31, 1992.
The Security Council,
Reaffirming its resolution 731 (1992) of 21 January 1992,
Noting the reports of the Secretary-General, 1, 2
Deeply concerned that the Libyan Government has still not provided a full
and effective response to the requests in its resolution 731 (1992) of 21
January 1992,
Convinced that the suppression of acts of international terrorism, including
those in which States are directly or indirectly involved, is essential for
the maintenance of international peace and security,
Recalling that, in the statement issued on 31 January 1992 on the occasion
of the meeting of the Security Council at the level of heads of State and
Government, 3 the members of the Council expressed their deep concern over
acts of international terrorism, and emphasized the need for the
international community to deal effectively with all such acts,
Reaffirming that, in accordance with the principle in Article 2, paragraph 4,
of the Charter of the United Nations, every State has the duty to refrain
from organizing, instigating, assisting or participating in terrorist acts in
another State or acquiescing in organized activities within its territory
directed towards the commission of such acts, when such acts involve a
threat or use of force,
Determining, in this context, that the failure of the Libyan Government to
demonstrate by concrete actions its renunciation of terrorism and in
particular its continued failure to respond fully and effectively to the
requests in resolution 731 (1992) constitute a threat to international peace
and security,
Determined to eliminate international terrorism,
Recalling the right of States, under Article 50 of the Charter, to consult the
Security Council where they find themselves confronted with special
economic problems arising from the carrying out of preventive or
enforcement measures,
Acting under Chapter VII of the Charter,
1. Decides that the Libyan Government must now comply without any
further delay with paragraph 3 of resolution 731 (1992) regarding the
requests contained in documents
S/23306, S/23308 and S/23309;
2. Decides also that the Libyan Government must commit itself definitively
to cease all forms of terrorist action and all assistance to terrorist groups
and that it must promptly, by concrete actions, demonstrate its
renunciation of terrorism;
3. Decides that, on 15 April 1992 all States shall adopt the measures set
out below, which shall apply until the Security Council decides that the
Libyan Government has complied with paragraphs 1 and 2 above;
4. Decides also that all States shall:
a. Deny permission to any aircraft to take off from, land in or overfly
their territory if it is destined to land in or has taken off from the territory
of Libya, unless the particular flight has been approved on grounds of
significant humanitarian need by the Committee established by paragraph 9
below;
b. Prohibit, by their nationals or from their territory, the supply of any
aircraft or aircraft components to Libya, the provision of engineering and
maintenance servicing of Libyan aircraft or aircraft components, the
certification of airworthiness for Libyan aircraft, the payment of new
claims against existing insurance contracts and the provision of new direct
insurance for Libyan aircraft;
5. Decides further that all States shall:
a. Prohibit any provision to Libya by their nationals or from their
territory of arms and related material of all types, including the sale or
transfer of weapons and ammunition, military vehicles and equipment,
paramilitary police equipment and spare parts for the aforementioned, as
well as the provision of any types of equipment, supplies and grants of
licensing arrangements, for the manufacture or maintenance of the
aforementioned;
b. Prohibit any provision to Libya by their nationals or from their
territory of technical advice, assistance or training related to the
provision, manufacture, maintenance, or use of the items in (a) above;
c. Withdraw any of their officials or agents present in Libya to advise the
Libyan authorities on military matters;
6. Decides that all States shall:
a. Significantly reduce the number and the level of the staff at Libyan
diplomatic missions and consular posts and restrict or control the
movement within their territory of all such staff who remain; in the case of
Libyan missions to international organizations, the host State may, as it
deems necessary, consult the organization concerned on the measure
required to implement this subparagraph;
b. Prevent the operation of all Libyan Arab Airlines offices;
c. Take all appropriate steps to deny entry to or expel Libyan nationals
who have been denied entry to or expelled from other States because of
their involvement in terrorist activities;
7. Calls upon all States, including States not members of the United
Nations, and all international organizations, to act strictly in accordance
with the provisions of the present resolution, notwithstanding the existence
of any rights or obligations conferred or imposed by any international
agreement or any contract entered into or any license or permit granted
prior to 15 April 1992;
8. Requests all States to report to the Secretary-General by 15 May 1992 on
the measures they have instituted for meeting the obligations set out in
paragraphs 3 to 7 above;
9. Decides to establish, in accordance with rule 28 of its provisional rules
of procedure, a Committee of the Security Council consisting of all the
members of the Council, to undertake the following tasks and to report on
its work to the Council with its observations and recommendations:
a. To examine the reports submitted pursuant to paragraph 8 above;
b. To seek from all States further information regarding the action taken
by them concerning the effective implementation of the measures imposed
by paragraphs 3 to 7 above;
c. To consider any information brought to its attention by States
concerning violations of the measures imposed by paragraphs 3 to 7 above
and, in that context, to make recommendations to the Council on ways to
increase their effectiveness;
d. To recommend appropriate measures in response to violations of the
measures imposed by paragraphs 3 to 7 above and provide information on a
regular basis to the Secretary-General for general distribution to Member
States;
e. To consider and to decide upon expeditiously any application by States
for the approval of flights on grounds of significant humanitarian need in
accordance with paragraph 4 above;
f. To give special attention to any communications in accordance with
Article 50 of the Charter from any neighbouring or other State with special
economic problems that might arise from the carrying out of the measures
imposed by paragraphs 3 to 7 above;
10. Calls upon all States to cooperate fully with the Committee in the
fulfillment of its task, including supplying such information as may be
sought by the Committee in pursuance of the present resolution;
11. Requests the Secretary-General to provide all necessary assistance to
the Committee and to make the necessary arrangements in the Secretariat
for this purpose;
12. Invites the Secretary-General to continue his role as set out in
paragraph 4 of resolution 731 (1992);
13. Decides that the Security Council shall, every 120 days or sooner should
the situation so require, review the measures imposed by paragraphs 3 to 7
above in the light of the compliance by the Libyan Government with
paragraphs 1 and 2 above taking into account, as appropriate, any reports
provided by the Secretary-General on his role as set out in paragraph 4 of
resolution 731 (1992);
14. Decides to remain seized of the matter.
VOTE: 10 for, 0 against, 5 abstentions.
1 S/23574.
2 S/23672.
3 S/23500. (###)
Dispatch, Vol 3, No 14, April 6, 1992
Title: Middle East Peace Talks and Patriot
Missile
Tutwiler
Source: State Department Spokesman Margaret Tutwiler
Description: Excerpts from the Department daily press briefing by
Margaret Tutwiler, Washington, DC
Date: Apr, 2 19924/2/92
Category: Speeches, Testimony, Statements
Region: MidEast/North Africa
Country: Israel
Subject: Mideast Peace Process,
Security Assistance and Sales
[TEXT]
...My first statement concerns the fifth round of the Middle East peace talks.
The United States, as a co-sponsor of the Arab-Israeli peace process, is
very pleased to be able to state that we have received word from all the
parties to the bilateral negotiations that they will attend the next session
in Washington, DC, on April 27.
We have also received informally from all the parties lists of acceptable
venues for the following round. There is some commonality between the
Arab and Israeli lists. We are, therefore, in a position today to announce
that the fifth round of the bilaterals will take place in Washington starting
April 27 and that the following round will be held in a venue closer to the
region.
We will announce that venue prior to the meeting this month in Washington.
The date of the sixth round will be subject to agreement between all the
parties to the bilaterals and ourselves....
I have a short statement on the recent Patriot mission.
First, we would like to express our appreciation to the Israeli Government,
especially the Defense Ministry, for the superb cooperation it gave to our
team.
Secondly, the US Government would have preferred to pursue the Patriot
missile question through diplomatic channels.
Third, as I said last week and the Secretary repeated this morning, those
who leaked intelligence reports owe both the US Government and the Israeli
Government an apology.
Fourth, our team found no evidence that Israel had transferred a Patriot
missile or Patriot missile technology. We plan no further action on this
question with Israel and consider the matter closed.
Fifth, as far as we are concerned, based on the results of this mission, the
Israeli Government has a clean bill of health on the Patriot issue. . . . (###)
Dispatch, Vol 3, No 14, April 6, 1992
Title: Transition to Democracy In South Africa
Cohen
Source: Herman J. Cohen, Assistant Secretary for African
Affairs
Description: Testimony before the Subcommittee on Africa of the
House Foreign Affairs Committee, Washington, DC
Date: Mar, 31 19923/31/92
Category: Speeches, Testimony, Statements
Region: Subsaharan Africa
Country: South Africa
Subject: Democratization, Regional/Civil Unrest
[TEXT]
It is a pleasure to appear before this subcommittee to report on the
transition to democracy in South Africa now that the events of recent
weeks have confirmed the irreversibility of the process. President De
Klerk's mandate to negotiate has been strengthened, and the negotiations are
solidly on track. Transitional non-racial government may come as early as
the latter part of this year.
Mr. Chairman, I would like to review a few recent events for the
subcommittee to outline how we have gotten this far. As you know, the
Convention for a Democratic South Africa, called CODESA, held its first
meeting December 20-21 in Johannesburg. These were the first actual
negotiations among the various political groups in South Africa; everything
before that had been "talks about talks." CODESA was possible, in part,
because the ANC's [African National Congress] General Congress held in
Durban last July gave the leadership a mandate to pursue negotiations with
the government and the National Party. It was also possible because many
other groups, including the Inkatha Freedom Party, chose to join in the
process.
On the government side, President De Klerk's mandate to pursue reforms
came earlier, from the National Party's victory in the 1989 general election.
However, over the course of the last year, the National Party lost three
consecutive by-elections to the opposition Conservative Party, which
opposes participation in CODESA. While two of the by-election defeats
came in constituencies with traditionally strong conservative support, the
third, in the university town of Potchefstroom, reversed a substantial
National Party majority.
These results come amidst growing concern about persistent violence among
blacks, increasing militancy and terrorist actions by right-wing whites, and
economic stagnation and rampant crime that knows no racial barriers. A
widely held perception that the mandate for reform was slipping led De
Klerk to call for an "up-or-down" referendum on the CODESA negotiations
among white voters. As you know, he won a resounding 69% of the vote on
March 17. Equally impressive, the voter turnout topped 85%, by far the
largest ever in a South African election.
While the Administration attached great importance to a favorable "yes"
vote in the referendum, we were careful to avoid letting charges of foreign
interference become an issue in the referendum. Our public statements
stressed continued negotiations at CODESA and that the referendum was an
internal matter for South Africa. We did, however, express our concern that
a "no" vote might lead to renewed international isolation and internal
discord. We urged the ANC and others to recognize that, however repugnant
a "whites only" referendum might be, a solid "yes" vote was clearly in their
interest. In the event, the ANC adopted a highly responsible approach.
To emphasize the benefits of growing acceptance in the international
community resulting from negotiations, we announced a number of programs
to underscore our concern with the economic well-being of South Africa. By
coincidence, on the day the referendum was announced, the President's
determination that South Africa had made "significant progress" in
eliminating apartheid, thus allowing the Export-Import Bank [Eximbank] to
support US exports to the South African Government, was made public. At
the same time, we reminded white-owned private businesses in South
Africa that they could qualify for Eximbank support for imports from the
United States provided they met our fair labor standards. During the
campaign, the Department of State informed the Trade and Development
Program (TDP) that South Africa should be considered a "friendly country"
for the purposes of initiating activities in South Africa pursuant to the
Foreign Assistance Act. The Overseas Private Investment Corporation
(OPIC) announced that it would send a team to South Africa in May to explore
the investment climate with the South African Government and other
parties engaged in the CODESA process. USAID [US Agency for International
Development] announced a $30-million housing project for victims of
apartheid, part of the doubling of US assistance levels to South Africa
announced by President Bush when he terminated CAAA [Comprehensive
Anti-Apartheid Act] sanctions last July. Now that De Klerk's hand has been
strengthened, we believe that there will be added impetus for CODESA to
move quickly. Last week, the government tabled its proposals for interim
government at the CODESA working group responsible for the issue. While
the ANC's initial public reaction was mixed, we are confident that
negotiations will be fruitful. Clearly, the government proposals are an
opening bid and subject to discussion. It is important to note that,
throughout the referendum campaign, the CODESA working groups continued
to meet. The second plenary session of CODESA is scheduled for May 15 and
16. We believe that this session could come to agreement on interim or
transitional arrangements to oversee preparations for elections.
The next step is likely to be agreement on the election, by all South
Africans on a one-man, one-vote basis, of an interim parliamentary body
which will be empowered to draft the new constitution while, at the same
time, acting as the national legislature. This election could come before the
end of the year or most certainly early in 1993.
Obviously, the final step will be the election under the new constitution of a
fully democratic, non-racial government. Very important differences
remain to be resolved before this or any of the preceding steps can be taken,
but there are many points of similarity among the various proposals
currently on the table. While tough negotiations will follow--and it is only
appropriate that such a momentous step come from serious negotiations--
we believe that there is a will in South Africa to make this transition work.
It can no longer be doubted that the vast majority of all South Africans
support negotiations. The Administration has long held the view that the
process of reform is irreversible; we hope that others will see it this way,
too.
Late last year, several members of the House and Senate, including yourself,
Mr. Chairman, and other members of this committee, wrote to President
Bush proposing a "South Africa Democracy Aid Initiative." My staff and I are
involved in ongoing consultations within the Administration and with
Congress regarding how we can best be supportive of both the transition
process and the non-racial democracy which we are convinced will emerge
from it. Let me state, for the record, that we share your concern that the
international community support South Africa in this crucial period. We
believe that action cannot wait. The economic underpinnings that will be
essential to the success of democracy must be built now, and we and other
international parties, public and private, must be involved.
In spite of our generally positive assessment of political developments in
South Africa, I would be remiss if I did not mention a calamity which
threatens the promising developments in South Africa as well as those that
mark much of the Southern Africa region. Southern Africa, this year, has
been the victim of a terrible drought. The region, as a whole, will need to
import over 9 million tons of grain. South Africa, which normally exports to
its neighbors, will import about half of this amount at a cost of over $1
billion. While South Africa will be able to fund these imports on a
commercial basis, they will come at the expense of stimulating economic
growth and addressing the tremendous backlog of black socioeconomic
needs. Costs for food imports elsewhere in the region will hit even harder,
and the problem of getting food assistance to where it is needed and through
an overworked transport network will be considerable.
It is unfortunate that, in a region undergoing such profound political change,
nature appears intent on undercutting so many promising trends. The United
States will do all it can to meet this challenge. In addition to the work
being done in Washington to identify aid resources, we have begun
consultations with South Africa and others in the region on how to deal with
this unexpected crisis. An additional benefit of the changes in South Africa
and elsewhere in the region is evidence that the governments of the region
are prepared increasingly to work together to address their common
problems. (###)
Dispatch, Vol 3, No 14, April 6, 1992
Title: Elections in Ethiopia
Tutwiler
Source: State Department Spokesman Margaret Tutwiler
Description: Statement, Washington, DC
Date: Mar, 30 19923/30/92
Category: Speeches, Testimony, Statements
Region: Subsaharan Africa
Country: Ethiopia
Subject: Democratization, Regional/Civil Unrest
[TEXT]
The United States is committed to the welfare and economic development of
the Ethiopian people and considers a peaceful transition to democratic
government essential to development and human well-being. We are
concerned by reports of violence in various parts of the country. Violence
for the purpose of influencing political behavior--whether by the
government or armed members of political fronts--is inconsistent with the
goals and principles of the Ethiopian National Charter and with progress
toward genuine democracy.
The United States, therefore, applauds the decision of the Ethiopian
Representative Council to arrange for all armed groups to be encamped
during the election process for district and regional representatives and
calls on all armed groups and the national military to comply with its letter
and spirit. Appropriate observers are prepared to monitor the encampment
of armed groups to ensure no side takes unilateral military or political
advantage of the process.
We also encourage all political forces to compete peacefully in the
upcoming elections. We welcome the assurance of the transitional
government that it will permit free and open political competition and
dialogue. We will help in any way we can to ensure that the political
competition and elections are carried out openly and fairly. Foreign
embassies, governments, and other interested non-governmental
organizations are willing to observe the electoral process with monitors
and endeavor to provide technical assistance.
The United States believes that open and fair district and regional elections
will significantly strengthen Ethiopia's chances for successful economic
and political development, which will, in turn, inspire donor confidence and
support. If, however, the elections are not carried out fairly by the
transitional government, we believe Ethiopia's road to democracy and eco-
nomic progress will be much more difficult. (###)
Dispatch, Vol 3, No 14, April 6, 1992
Title: Pursuing US Objectives In Asia and the
Pacific
Solomon
Source: Richard H. Solomon, Assistant Secretary for East
Asian and Pacific Affairs
Description: Statement before the Senate Foreign Relations
Committee, Washington, DC
Date: Mar, 31 19923/31/92
Category: Speeches, Testimony, Statements
Region: East Asia, Southeast Asia
Country: Japan, North Korea, South Korea, Vietnam, Laos,
Cambodia, Thailand, Burma
Subject: Trade/Economics, Regional/Civil Unrest,
United Nations, Democratization, POW/MIA Issues,
Nuclear Nonproliferation, Arms Control
[TEXT]
Mr. Chairman, members of the committee, I am pleased to
have this opportunity to discuss my recent trip to several East Asian
countries and the range of issues which I pursued related to advancing
American interests in the region.
During my trip earlier this month [March], I visited Thailand, Vietnam,
Cambodia, Laos, the Republic of Korea, Japan, and Hong Kong. As this
committee will be holding a separate hearing on Hong Kong later this week, I
will not address issues related to that portion of my travels here today.
Let me say a few words about the broader context of those travels. My trip
took place in the aftermath of the President's visit to the Asia-Pacific
region earlier this year. My consultations reflected many of the challenges
and objectives President Bush emphasized on his trip: realizing a just peace
in Cambodia and attaining the fullest possible accounting of POW/MIA's
[prisoners of war/missing in action] from the Vietnam war era so that we
can begin a new era in our relations with the nations of Indochina; meeting
the challenge of nuclear proliferation on the Korean Peninsula; and forging a
global partnership with Japan by enhancing our foreign policy cooperation
and attaining more balanced and equitable economic relations.
Indochina
Indochina was a central focus of my mission. My visit to Vietnam, Laos, and
Cambodia marked the first time that an Assistant Secretary of State has
visited all three countries in the same trip since the end of the Vietnam
war; and it was the first to Cambodia since Phonm Penh fell to the Khmer
Rouge. As President Bush said in Singapore last January, the United States
seeks to improve its relations with Vietnam, Laos, and Cambodia and help
integrate all three countries into the dynamic East Asian region and the
larger international economic and political system. I went to Indochina to
advance this process of reconciliation between the United States and these
three states; to help create conditions in which we could begin to build as
the President said in his Singapore lecture, "lasting ties of interest and
affection."
Vietnam
As I have testified here previously, in April 1991, we presented to the
Vietnamese a normalization plan sometimes referred to as the "road map."
This policy was designed to allow the United States to pursue--in parallel--
the two primary policy objectives for Indochina that we have maintained
over the past 12 years: attaining the fullest possible accounting for our
POW/MIAS; and a negotiated peace settlement in Cambodia which will result
in the withdrawal of all Vietnamese forces, prevention of a return to power
of the genocidal Khmer Rouge, and free elections for the formulation of a
new Cambodian government.
Our policy framework is a step-by-step process whereby the United States
and Vietnam would take a series of reciprocal measures designed to build
trust and confidence. It would lead to normalization of our economic and
political relations as the Cambodia peace accords are implemented and as
POW/MIA accounting advances. It left Hanoi with no doubt as to where we
stand and under what circumstances we would be prepared to move ahead.
I would note that in the months since the Paris accords were signed last
October, Vietnam has, to varying degrees, addressed many of the concerns
embodied in our policy, including POW/MIA accounting and other
humanitarian issues.
At the signing of the Cambodia peace agreement in Paris last October,
Secretary Baker announced that, in view of the cooperation from Vietnam
and Cambodia on the UN settlement effort as well as certain progress on the
POW/MIA issue, the United States was taking steps to launch this
normalization process. The initial actions in this process included:
-- Changing the embargo rules to permit US-organized group travel to
Vietnam;
-- Lifting the 25-mile travel limit for Vietnamese diplomats assigned to
the United Nations;
-- Beginning talks with Vietnamese officials in New York about the issues
and modalities surrounding the normalization process;
-- Establishing a US mission in Cambodia;
-- Stating publicly our concerns about genocide in Cambodia and our
determination to prevent its recurrence; and
-- Lifting the trade embargo against Cambodia as soon as implementation
of the peace agreement began.
At the same time, the United States has sustained our efforts to address
Vietnam's humanitarian needs, especially in the health and public services
sectors. Vice Foreign Minister Le Mai and I held the first round of
normalization talks in New York last November, and Vietnam's Permanent
Representative to the UN, Ambassador Trinh Xuan Lang, met with my deputy
Ken Quinn in January to review various technical issues that we agreed
would be addressed in a US-SRV [Soviet Republic of Vietnam] working group.
Last September, and again in late January, Gen. John Vessey, the President's
special emissary to Hanoi for POW/MIA affairs, traveled to Hanoi and met
with Vietnamese leaders. During these visits, he obtained important new
Vietnamese commitments on our POW/MIA accounting, as well as some
specific Vietnamese actions to implement those understandings. General
Vessey's important work--in conjunction with the signing of the UN
settlement agreement for Cambodia--helped set the stage for us to begin
the normalization process. However, on his most recent visit at the end of
January, the General was told that there was some reluctance in Hanoi to
move ahead as rapidly as we proposed to achieve our POW/MIA objectives.
General Vessey underscored to Vietnamese leaders our intent to adhere to
our policy objectives, emphasizing that we were prepared to move either
rapidly or slowly toward normalization with Vietnam: The pace and scope
of the process--as we have consistently maintained for years--will depend
on the speed of our progress in POW/MIA accounting. At the same time,
Hanoi indicated a strong desire to discuss the full range of our cooperation
on humanitarian issues, including US efforts to meet Vietnam's
humanitarian needs. In sum, there appeared to be a real danger in late
January that the process was gridlocked.
Fortunately, subsequent developments have been more favorable to progress.
On March 4-5, I led a delegation to Hanoi to discuss humanitarian issues of
concern to the United States and Vietnam. Traveling with me were Mr. Alan
Ptak, the new Deputy Assistant Secretary of Defense for POW/MIA Affairs,
Mr. George Laudato, the Deputy Assistant Administrator of USAID [the US
Agency for International Development] for Asia, and Mrs. Ann Mills Griffiths,
the Executive Director of the National League of Families. Brig. Gen. Thomas
Needham, Commander, Joint Task Force-Full Accounting, joined us in the
region after having presented our plans for an accelerated POW/MIA effort
to his Vietnamese counterparts the previous week. In my discussions with
the Vietnamese, we reached an important new level of understanding on how
both sides can improve our humanitarian cooperation, particularly on
POW/MIA accounting.
The Vietnamese agreed to a five-point program to accelerate their
cooperation with us on POW/MIA investigations, undertaking to do the
following:
-- Allow us greater access to their central records, archives, and museums
and to individuals with information on POW/MIA issues;
-- Implement a mechanism for short-notice "live sighting" investigations;
-- Begin a 2-year plan for accelerated joint investigations in Vietnam, to
include five such investigation cycles over the next 10 months, focusing on
the 135 remaining high-priority discrepancy cases;
-- Continue to work on trilateral cooperation with Lao and Cambodian
authorities; and
-- Reaffirm Vietnam's intention to search for and rapidly repatriate
remains of Americans still unaccounted for and to hold technical exchanges
in order that we understand clearly why remains we believe they might have
access to are not available--if that is indeed the case.
If all five agreements are sincerely implemented, they should significantly
advance us to our goal of attaining the "fullest possible accounting" within a
reasonable period of time.
Vietnam signaled its intent to deliver on this program in several ways.
First, it agreed to the first short-notice investigation of a live-sighting
report on March 5, the day I completed my talks in Hanoi. With only 1 hour's
notice to Vietnam of the destination, a helicopter lifted off from Hanoi that
day with Vietnamese and US experts on board and flew to a remote part of
Thanh Hoa Province, where they were able to conduct a thorough
investigation. US personnel were permitted to conduct spontaneous
interviews with local villagers of their own choosing and were permitted to
move about the area freely. After thorough investigation, our experts
concluded that the report that live Americans were seen in this particular
area in 1986 was not credible.
Also on the day I departed Hanoi, a Vietnamese delegation traveled to Phnom
Penh to participate in the first trilateral talks with US and Cambodian
officials; this followed the US-SRV-Lao trilateral talks held in Vientiane
[Laos] last December. We thus have established a mechanism for pursuing
the fullest possible accounting for Americans missing in the border areas
between these countries. As I left Vietnam, the 16th in a series of joint
investigations was taking place in Vietnam. Results from this activity, as
well as the day-to-day cooperation our POW/MIA office receives in Vietnam,
will help confirm whether Vietnam continues to implement the steps we
reached understandings on in Hanoi. The initial assessments of the 16th
iteration are encouraging. General Needham is in Hanoi today to arrange the
17th joint investigation, which begins next month.
Finally, a few days after I left Hanoi, Vietnam informed us that they had
recovered three sets of remains believed to be of American servicemen. We
have repatriated them and are examining the remains to determine whether
they are indeed American.
In Hanoi, we also discussed US efforts to address Vietnam's humanitarian
needs. As you know, Mr. Chairman, since 1987, the United States has urged
American non-governmental organizations (NGOs) to donate humanitarian
assistance to Vietnam under an initiative headed by General Vessey. In
1990, we announced that Treasury Department licensing regulations for
humanitarian donations would be streamlined; in 1991, we made the first
direct donation of US aid, providing $1.3 million for prosthetics assistance
in Vietnam. This past January, we provided our first donation of disaster
relief for Vietnam, giving $25,000 for typhoon relief.
In Hanoi, I told our hosts the United States is prepared to take additional
steps to address Vietnam's humanitarian needs. I outlined a humanitarian
assistance package for 1992 that will include additional funds for
prosthetics assistance, aid for displaced children, excess medical
equipment made available by the Department of Veterans Affairs, Fulbright
scholarships, possible additional disaster relief, and use of the Denton
amendment program to transport humanitarian assistance donated by NGOs.
In addition, Department of Defense medics accompanying our teams doing
POW/MIA investigations in Vietnam will now offer medical services to local
residents.
Laos
In Laos, my delegation was received at an unprecedentedly high level,
meeting for the first time with Prime Minister Khamtai and Minister of
Defense Choummali, as well as Foreign Minister Phoun and Vice Minister
Soubanh. The Lao Government agreed to expand its already considerable
cooperation with us on POW/MIA investigations, including provision of Lao
personnel to work with Department of Defense officials assigned to
Vientiane for this purpose. They informed us they would soon be turning
over two sets of remains, apparently of American servicemen, discovered by
local people in Xieng Khoang Province. They also agreed to accept US
training of helicopter pilots so that they will eventually be qualified to fly
US helicopters for our joint investigative work. Finally, the Lao Government
pledged to continue their cooperation with us to counter the narcotics trade,
particularly in the enforcement area.
I told the Lao the United States is gratified by their cooperation on these
important issues and urged continuing efforts. Our relationship has
improved significantly over the past several years, and the President
announced in November that we will raise the level of our representation to
the ambassadorial level for the first time since 1975. The United States
has recently established a POW/MIA office in our Embassy in Vientiane, and
we look forward to increasingly productive efforts to account for US
servicemen missing in Laos. During this visit, I announced our decision to
provide 4,000 metric tons [mt] of rice and a $400,000 famine mitigation
program in response to recent disasters caused by floods and drought. I also
told the Lao that we would be building more schools in remote areas and
would send a USAID team this spring to survey prosthetics needs with a
view to increasing our assistance in this field.
Cambodia
Achievement of the comprehensive political settlement agreement for
Cambodia last October laid the groundwork for regional peace and national
reconciliation following decades of war. I traveled to Cambodia to
underscore continuing US support for the settlement agreement signed in
Paris last year and to assess progress so far in implementing it. Joining my
delegation was Deputy Assistant to the President Sichan Siv, himself a
survivor of the Khmer Rouge killing fields. We were received by Prince
Sihanouk and met with officials of the UN Advance Mission in Cambodia
(UNAMIC) and a number of Cambodian leaders representing the state of
Cambodia and the non-communist resistance parties on the Supreme
National Council (SNC). All the Cambodians we met expressed their strong
support for the settlement process and looked forward to the impending
arrival the following week of the UN Transitional Authority in Cambodia
(UNTAC).
I found that UNAMIC has done a good job in carrying out its limited mandate
to prepare the country for the arrival of UNTAC, but that implementation of
the settlement will depend importantly on a credible, sizeable UN presence-
-especially during the difficult transitional period--as demobilization and
cantonment of forces is carried out. UNTAC will also have an important role
to play in eliciting the cooperation of the Khmer Rouge. To date, we have
been disappointed and concerned about credible reports of Khmer Rouge
military actions in Kompong Thom and other instances of non-cooperation in
contravention of the requirements of settlement implementation. We also
urged restraint on the part of the state of Cambodia during our meetings
with Hun Sen last week.
Everything I witnessed in Cambodia--from the atrocities of the Tuol Sleng
genocide museum to the newly built refugee repatriation center at Siem
Reap--convinces me it is essential that the United States and other donor
countries act quickly to provide funding for this vitally important UN
mission. The horrors inflicted on the Cambodian people over the last 2
decades must never be allowed to recur. The UN settlement is Cambodia's
last, best--perhaps its only--hope. The visit of SNC [Supreme National
Council] member Hun Sen to Washington last week testified to the hopes of
all Cambodians that the United States will do its share to make the UN
settlement process succeed.
The Phnom Penh authorities continue to cooperate with us fully on POW/MIA
work. The first full-scale joint recovery and excavation operation was in
progress while I was in Cambodia, and US military helicopters were allowed
to operate within the country for this purpose. That investigation has
uncovered at least four sets of remains of individuals missing since 1970.
Mr. Hun Sen and Mr. Chea Sim of the state of Cambodia reaffirmed the
willingness of their administration to continue cooperating with us on this
important endeavor.
In conclusion, I came away from this portion of my trip with the conviction
that we have finally laid in place policies, processes, and personnel which
will help put the past behind us and move toward a new relationship with all
three countries of Indochina. Good faith implementation of these plans by
the leaders of Vietnam, Laos, and Cambodia will be key to achieving this
goal. The Administration and the American people will now be looking for
results.
In particular, we will be seeking to account for as many of our missing
servicemen from the war as possible. Achievement of that important goal,
in the context of continuing progress in Cambodia, will allow us to move
toward the objective announced by President Bush and Secretary Baker of
reconciliation with all three countries of Indochina. With resolution of
these problems, we look forward to the day when progress in all three
countries will enable them to join their Southeast Asian neighbors as
productive partners in a more prosperous and peaceful international
community.
Thailand/Burma
I met with Thai leaders both before and after my trip to Indochina. The Thai
were in the midst of an important election campaign; the recent results of
which we hope will herald a return to democracy to Thailand.
While our support for constitutional rule and democracy as well as bilateral
economic issues were matters I pursued with various Thai leaders, we also
focused on regional issues of mutual concern: Cambodia, Vietnam, and
Burma. Our close cooperation with the Thai Government as a treaty ally and
prominent member of the Association of Southeast Asian Nations (ASEAN)
has facilitated our efforts to bring peace to Cambodia. The Thai share our
interest in adhering to the schedule for elections in Cambodia next year and
recognize that our contribution to UNTAC will be crucial to meeting this
goal. For their part, the Thai are working closely with the UN High
Commissioner for Refugees to assure an orderly and safe repatriation of
Cambodian displaced persons and have contributed personnel and funds to
road-building and mine-clearing projects in support of the repatriation
effort.
The Thai are also very interested in the progress of our relations with Hanoi
and are working to improve their own relations with Vietnam. I explained to
the Thai that I had had a series of constructive meetings with the
Vietnamese and that we hoped that implementation of the five-point
program discussed in Hanoi would enable us to take correspondingly positive
steps. The Thai welcomed this news and shared their impression that the
Vietnamese are eager to improve their relations with the outside world.
I also discussed our continuing concerns about the deteriorating situation in
Burma, which has begun to spill over into Thailand and Bangladesh. Let me
add here that we will work with others [to] ameliorate the situation of the
Rohingya refugees fleeing Burma for Bangladesh, and that, in this
connection, we welcome the forthcoming visit by a representative of the UN
Secretary General to Burma and Bangladesh.
During my discussions, I noted that the refugee outflux is growing and that
narcotics obviously remain a severe problem. I explained that there was
considerable interest in the United States in the safety of Burmese refugees
in Thailand and suggested that if the Thai do set up a safe area for Burmese
students, we believe that appropriate international organizations should
have regular access.
On bilateral matters, I stated that the US Government views Thailand as a
staunch and long-term friend and that we particularly appreciated
Thailand's cooperation during the Gulf war. I noted, as well, that we
welcomed the passage of the narcotics-related asset forfeiture and
conspiracy legislation and that we had made strides in protection of
copyrights and patents and hoped to make further progress on our remaining
concerns. And I stressed our support for Thai efforts to move ASEAN to
become a free trade area.
Korean Peninsula
I also held discussions in Seoul, which, like Bangkok, was consumed by
election fever. As was demonstrated by the March 24 National Assembly
elections, democracy is sinking ever-deeper roots in South Korea. Most of
my discussions, however, centered on the problem of getting Pyongyang
[North Korea] to abandon its efforts to acquire a nuclear weapons capability,
to take meaningful steps to ease tensions on the peninsula, and to become a
responsible international actor on issues such as the proliferation of
weapons of mass destruction and their delivery systems. These discussions
were part of a deepening pattern of consultations with our Republic of Korea
allies with whom we are working closely to resolve the nuclear issue on the
Korean Peninsula.
Our main concern, and that of the Republic of Korea as well, is related to the
international community's suspicion that, despite its agreements with the
South and with the IAEA [International Atomic Energy Agency]--agreements
that remain to be implemented--the North Koreans have not abandoned their
quest for a nuclear weapons capability. Only credible inspection regimes
and their full implementation under both the bilateral agreement and the
IAEA safeguards agreement will begin to give the international community
confidence that the North Koreans are genuinely honoring their commitments
and are prepared to move beyond the military confrontation that has
polarized the peninsula for more than 4 decades.
There are some hopeful signs. In February, the North and South brought into
force two bilateral agreements: One is a broad-ranging agreement on
reconciliation and non-aggression, and the other a non-nuclear agreement.
Subcommittees on military matters, political matters, and economics and
exchange have already begun meeting under the reconciliation agreement,
and the two sides have formed a joint nuclear control commission, or JNCC,
under the non-nuclear agreement.
The two sides have publicly committed themselves to work to produce an
inspection regime within about 2 months after the first meeting of the JNCC
on March 19. They agreed further that inspections would begin within 20
days of agreement on the inspection regime. When completed, that
agreement will form the basis for bilateral inspections to verify the non-
nuclear agreement. The North has also said it would ratify its IAEA
agreement in April, notify the IAEA of its list of relevant facilities in May,
and then have IAEA inspections in June.
Thus, the Democratic People's Republic of Korea now has before it a golden
opportunity to allay suspicions, demonstrate its credibility, and accelerate
an opening to the outside world, thereby joining the mainstream of global
trends toward reconciliation, reform, and economic development. If
Pyongyang acts in good faith, we could see IAEA and bilateral inspections
under both regimes by the end of June.
Such a development would be a historic step forward in moving toward the
stated goal of both Koreas of a secure, de-nuclearized Korean Peninsula.
Further, it would give added impetus to the ongoing North-South dialogue,
which remains the primary means for resolving Korea's problems and
achieving national reconciliation and eventual reunification. Resolving the
nuclear issue would also make possible movement toward a significant
improvement in US relations with the Democratic People's Republic of
Korea. We hope the North will see its interests served by taking advantage
of this opportunity. The alternative can only be heightened suspicions,
rising tensions, and sustained isolation for the North Koreans.
Another area of concern, of course, is North Korea's weapons proliferation
activities, especially its trade in missiles with various countries in the
Middle East. We have urged North Korea's leaders to refrain from this
practice, which is clearly destabilizing to a highly volatile region. We have
told them that these unacceptable activities can only worsen their
international reputation and further retard any prospects for improved
diplomatic and economic relations with the international community. We
are working together with other concerned countries to find ways to limit
the introduction of destabilizing weapons into areas of concern, especially
the Middle East.
For the moment, however, we are in a period of what might be called
"watchful waiting" to see if Pyongyang will take a new direction in its
security policies--especially on the nuclear issue. The North has now made
several important commitments on paper, and we expect them to be fulfilled
completely in the timeframe Pyongyang has publicly committed itself to.
Nothing less can adequately remove the suspicions we share with the rest of
the world. Further delays in what is already an unreasonably protracted
process would be cause for grave international concern.
Japan
My stop in Tokyo involved consultations on the East Asian aspects of our
global partnership and follow-up from the President's trip on a number of
trade and financial issues essential to keeping that partnership on a solid
economic footing. Our relations with Japan must rest on equitable and
mutually advantageous political, security, and economic foundations. That
partnership offers unprecedented opportunities for shaping the post-Cold
War international system through close coordination of US and Japanese
policies to encourage stability, respect for human rights and political
pluralism, economic development, and halting the worldwide proliferation
of weapons of mass destruction.
Since the President's visit, there has been significant progress on a number
of Asian fronts which my consultations sought to reinforce:
Vietnam: Japan has been very helpful in urging Hanoi to be responsive to our
POW/MIA concerns. A recent letter from Japan's Foreign Minister, Michio
Watanabe, to his Vietnamese counterpart seems to have facilitated Hanoi's
decision to agree to the five-point program I mentioned earlier. And Japan's
Vice-Minister for Parliamentary Affairs, Koji Kakizawa, stressed the need
for Hanoi's full cooperation in resolving the POW/MIA issue during a visit to
Hanoi just last week. We are very appreciative of Japan's efforts.
On Cambodia, I debriefed my Japanese counterparts on my assessment of the
situation there and discussed the challenges ahead for the UNTAC in
successfully implementing the Paris accords. There are indications that
Japan will provide generous support for UNTAC. Mrs. Ogata's activities in
the UNHCR and Mr. Akashi's as the UN Secretary General's Special
Representative to Cambodia underscore Japan's increasingly important
leadership role in the UN settlement process.
Korea: Close cooperation with Japan has been key to our diplomatic efforts
to end the North Korean nuclear threat, and I debriefed my Japanese
colleagues on my discussions in Seoul and our assessment of the current
situation on the peninsula. In Japan's normalization talks with North Korea
and in our limited dialogue with Pyongyang, we both have made clear to
North Korea it must meet the concerns of the international community about
its nuclear program if it is to develop normal and constructive international
dealings.
More generally, there have also been close consultations between our two
governments on regional issues with global implications, including the
Middle East peace process and assistance to the republics of the former
Soviet Union.
-- Japan has been very supportive on both Middle East and CIS
[Commonwealth of Independent States] initiatives. Tokyo is taking an active
role in these diplomatic efforts. Of course, much remains to be done on a
number of issues of mutual concern.
-- Having seen recent progress on People's Republic of China [PRC]
participation in the global non-proliferation regime, we must continue to
encourage constructive Chinese involvement in such international security
activities and to encourage improvements in Chinese human rights
practices.
-- We must press the Burmese regime to ameliorate the situation of the
Rohingya refugees fleeing Burma for Bangladesh and to improve its record on
human rights and political activities generally.
-- We need to continue our joint efforts in support of democratization and
development in Mongolia. A second Mongolia donors' conference is
scheduled this spring as a follow-on to the Tokyo conference held last
September.
Economic issues
I also followed up on a range of economic issues raised during the
President's trip. Press reports notwithstanding, I would like to provide an
update on significant progress in trade-related issues over the past 3
months:
-- The President's visit to Japan produced market access gains in sectors
important to our exporters such as computers, glass, paper, and auto parts.
Business leaders who accompanied the President report positive results for
their companies and for US business in general.
-- Japanese auto-makers agreed to more than double their procurement of
US-made parts by 1994. This is consistent with MITI [Ministry of
International Trade and Industry]'s business global partnership program,
which encourages Japanese firms to import more, source more locally in
their overseas operations, and to assist foreign firms entering Japan's
market. We want Japanese car-makers to work with US parts suppliers on
product development, the same way they work with their Japanese
suppliers. US auto-parts-makers tell us they now see changed attitudes and
more interest in US products among Japanese car makers.
-- On autos, we are giving full support to the efforts of US car-makers to
sell in Japan.
-- As The Washington Post reported after the President's visit, the US
computer industry was "stunned" by how rapidly we negotiated the public
sector procurement agreement and the fact that we addressed every major
issue raised by the industry to its satisfaction. Our companies are now
gearing up to take advantage of new opportunities.
-- On paper market access issues, negotiations are continuing to get
measures in place which would expand access for US firms to Japan's
domestic paper market. We are firmly committed to supporting the efforts
of US paper companies to succeed in Japan's market.
-- We are addressing the imbalances in trade and investment through the
Uruguay Round [of the General Agreement on Tariffs and Trade--GATT], the
Structural Impediments Initiative (SII), and market access talks. While our
bilateral trade deficit with Japan has fallen from $57 billion in 1987 to
$42.3 billion in 1991--and our exports to Japan doubled during that period--
the deficit remains unsustain-ably high and could increase as the US
economy strengthens. I must add that Japan's current global account surplus
for 1991 of $78 billion--almost double the previous year--indicates that
its imbalances are of growing concern to Europe and others in Asia as well.
If Japan cannot get these surpluses under control, it will weaken the
country's welcome in many parts of the world.
-- SII is aimed at addressing the structural features in the US and Japanese
economies that block the free flow of goods, services, investments, and
balance-of-payments adjustment. Last year we made good progress on
reform of Japan's distribution system. This will make US products more
widely available to Japanese consumers. In 1992, we are focusing on how
the Japanese business environment affects the entry of newcomers.
-- In the Uruguay Round, agricultural reform is key, which means
tariffication for all commodities from all countries. For Japan, that means
rice. I sought to encourage Japan to demonstrate leadership in increasing
market access for goods and services as well.
Finally, the President and Prime Minister Miyazawa in Tokyo in January
pledged to work together to promote growth in the US and Japanese
economies, which together account for 40% of world GNP. We look for
policies from Japan that will stimulate economic growth through expansion
of domestic demand, not through an ever-growing export sector. (###)
Dispatch, Vol 3, No 14, April 6, 1992
Title: US Policy Toward Hong Kong
Solomon
Source: Richard H. Solomon, Assistant Secretary for East
Asian and Pacific Affairs
Description: Statement before the Subcommittee on East Asian and
Pacific Affairs of the Senate Foreign Relations Committee,
Washington, DC
Date: Apr, 2 19924/2/92
Category: Speeches, Testimony, Statements
Region: East Asia
Country: Hong Kong, China
Subject: Trade/Economics, Democratization
[TEXT]
Thank you for the opportunity to appear before you today to discuss US
policy toward Hong Kong. I have just returned from a visit to Hong Kong
during which I had the opportunity to meet with Governor Wilson, members
of the Legislative Council, and key business and community leaders. I can
tell you that confidence in the territory is high and that people there are
keenly interested in our deliberations here today.
Let me add that as a former resident of the territory and as a [People's
Republic of] China (PRC) hand for more than three decades, the future of
Hong Kong is a subject of great personal interest. Hong Kong is perhaps the
world's most dramatic example of free enterprise; its considerable success
testifies to the results that free markets, human energy, and discipline can
produce. Hong Kong is now an engine of the remarkable growth transforming
the economy of southern China. I would also note that Hong Kong's fate
post-1997 will be a measure of China's own reform efforts and of its
relationship to the international economic and political system.
I will also be pleased to offer some initial comments on Senator [Mitch]
McConnell's bill, the US-Hong Kong Policy Act [S. 1731]. We have been
examining the implications of 1997 for US-Hong Kong relations, and this bill
has helped us sharpen our own thinking on this issue. The Administration
supports the goals of this legislation and is pleased that Congress shares
our interest in the future of Hong Kong. With modifications, this legislation
can make a significant contribution to US efforts to prepare for Hong Kong's
reversion to Chinese sovereignty on July 1, 1997. As I will note a bit later,
the United States has a very substantial stake in the success of Hong Kong's
transition, and US policy has an important role to play in assisting this
process.
Renewed Confidence
Five years before its reversion to China, Hong Kong seems to be in a new
cycle of growth. It appears to have largely recovered from the blow to its
confidence which occurred after the Tiananmen tragedy in June 1989. Signs
of prosperity are everywhere. Emigration declined slightly in 1991.
Economic growth has risen to 4%. Unemployment remains very low at 2%.
Hong Kong's real estate market is up nearly 50% in the past year. Agreement
has been reached between the UK and China on a $16-billion project to
develop new airport and container facilities in Hong Kong, an infrastructure
enhancement plan which promises to boost economic growth for some time
to come.
Hong Kong has taken steps to formalize its commitment to respect the
rights of its residents. Last year, Hong Kong passed a bill of rights and is
reviewing and revising its laws to ensure that they fully conform to
internationally recognized standards of human rights.
For the first time, Hong Kong voters went to the polls last September to
elect 18 of the territory's 60 Legislative Council members. These elections
were an important step in advancing the democratic process. As a result,
the United Democrats, led by Martin Lee, and parties allied with it--all of
whom are committed to ensuring rigorous adherence to the letter and the
spirit of the 1984 Sino-British Joint Declaration--now hold 17 of the 18
directly elected seats.
Sino-UK Joint Declaration
In 1984, China and the UK settled the future status of Hong Kong and
detailed the basic policies of the PRC regarding Hong Kong in the Joint
Declaration, a formal international agreement. China will resume the
exercise of sovereignty over Hong Kong, which will be governed as a Special
Administrative Region of China until, at least, the year 2047. The Chinese
Government will be responsible for Hong Kong's foreign affairs and defense,
just as the UK Government has those responsibilities now.
Under the agreement, Hong Kong will enjoy a high degree of autonomy in all
other matters. The Special Administrative Region will have its own
government and legislature composed of local residents. The fundamental
rights and freedoms of its residents are to be ensured by law, and
independent courts will enforce these laws. China's socialist system will
not be imposed in Hong Kong. Hong Kong will continue to participate after
1997 in international agreements and organizations which are open to non-
states, such as the GATT [General Agreement on Tariffs and Trade] and APEC
[Asia-Pacific Economic Cooperation].
The United States is not a party to the Joint Declaration, nor are we in any
sense a guarantor. The United States has no special standing in regard to
the agreement. Ordinarily in international law, states do not take formal
positions on bilateral agreements to which they are not a party.
However, the United States strongly supports the Sino-UK Joint Declaration
and its objectives. We believe that the Joint Declaration provides the basis
for maintaining Hong Kong's separate--and increasingly democratized--
political system and private enterprise economy for, at least, the next 50
years.
Our interest over the next few years is that the transition from UK to
Chinese sovereignty be smooth, that Hong Kong's current prosperity and
favorable human rights situation continue, that democratization advance,
and that the US relationship with Hong Kong be preserved and strengthened.
Before 1997, it is primarily incumbent on the PRC and the UK Governments
to take the necessary steps to preserve Hong Kong's essential character;
after 1997, that task will be China's alone. Obviously, how China exercises
its sovereignty over Hong Kong will affect American attitudes toward China.
Hong Kong-PRC Economic Relations
China has substantial interests and compelling incentives to respect its
obligations and seek to preserve the conditions that have allowed Hong Kong
to prosper. China's stake in Hong Kong's success is considerable.
-- China has a clear and growing economic stake in Hong Kong's continued
prosperity: the PRC is the largest foreign investor in Hong Kong, and Hong
Kong is the largest source of foreign investment in China and an important
economic and financial entrepot to the outside world.
-- The economic integration of South China with Hong Kong has been key to
the remarkable success of the Special Economic Zones adjacent to Hong Kong
and the Pearl River delta, which has made South China an engine of Chinese
economic growth.
-- China views its success in Hong Kong as something that may have a
bearing on its future relations with Taiwan.
The symbiotic economic relationship between southern China and Hong Kong
grew out of China's policies of modernization and opening to the outside in
1979. These trends accelerated dramatically after the 1984 Joint
Declaration. Lured by investment opportunities, Hong Kong businesses
spread into China, relocating factories processing goods for export. Today,
more than 20,000 Hong Kong companies employ some 3 million PRC workers
in these plants. Many more workers depend indirectly on these enterprises
for their livelihood.
Foreign investment, much of it from Hong Kong, has generated economic
development and wealth in China. This has led Chinese companies to invest
in Hong Kong, strengthening ties between the two economies. Chinese-
owned firms participate in infrastructure projects; invest in the property
market and stock exchange; and operate taxi fleets, hotels, and restaurants.
China has very substantial interests in Hong Kong's banking sector. Chinese
provincial and municipal traders and construction and manufacturing units
have also set up companies in Hong Kong. These interests offer China
compelling incentives not to tamper with Hong Kong's economic system.
After 1997, the world will continue to engage in economic relations with
China through Hong Kong. By that time, mainland firms will have had more
than 18 years of on-the-job training in how to do business the Hong Kong
way. They will use Hong Kong as a base to increase their trade, investment,
and financial interchange with the rest of the world just as foreign firms
now use Hong Kong as a bridge to China.
Deng Xiaoping's [senior Chinese leader] January visit to Guangdong Province
and particularly to Shenzhen, the Special Economic Zone on the Sino-Hong
Kong Border, was symbolic of South China's success and the importance
attached to it for China's future. Subsequent to Deng's visit, China's
Politburo publicly issued an endorsement of Deng's policies of economic
openness and reform which, it stated, should be followed for the next 100
years. These developments should re-enforce the positive trends which
have created an integrated and rapidly growing market-oriented economy in
southern China. Continued prosperity of this economy, which also involves
investments from the United States, South Korea, and Taiwan, offers
perhaps the best guarantee that Hong Kong will remain a financial,
manufacturing, and communications center.
Hong Kong's Political Future
In its last years under UK rule, Hong Kong is developing its own unique
political identity. Since the signing of the Joint Declaration, a process of
democratization has begun in Hong Kong and brought the partial realization
of China's stated intention that the Hong Kong people themselves will rule
the territory after 1997. China's commitment in the Joint Declaration to a
high degree of autonomy for Hong Kong offers hope for continuation of this
process after 1997.
As I noted in my departure statement during my visit to Hong Kong last
month, a fully successful transition must safeguard human rights, even as a
basis for continued economic prosperity. Therefore, we view with some
concern China's criticism of Hong Kong's Bill of Rights. In our view, this
legislation ensures that the Hong Kong Government, and the Hong Kong
Special Administrative Region, which is to follow it, has in place a
systematic process to protect human rights.
In this regard, we would also note with concern China's media attacks on
Hong Kong's democratically elected Legislative Council members and its
appointment of 44 "Hong Kong advisers," both of which suggest unease with
the democratic process that bears watching. I would also note that, since
1984, some of the activities of the New China News Agency, Beijing's de
facto representative office in Hong Kong, have periodically fueled
controversy that has affected confidence. We believe that it is in China's
best interests to respect the expressed will of the people of Hong Kong and
to refrain from any action which would call into question the future
protection of internationally recognized human rights and fundamental
freedoms in Hong Kong.
In the next few years, the trends of economic symbiosis and growth in
political awareness will emerge more clearly. What will be visible is a
Hong Kong more highly integrated with China but no less integrated with the
rest of the world, a Hong Kong which still functions as an open society with
an independent legal system and where civil liberties continue to be
respected. That is what the Joint Declaration intends, and that is what the
people of Hong Kong expect.
US-Hong Kong Relations
The United States has significant interests in Hong Kong which warrant
concern for the success of the 1997 transition to Chinese rule. Our close
attention is in keeping with the admiration and respect which Hong Kong's
residents have won over the years by creating one of the most vibrant and
productive societies on earth.
Our economic stake in Hong Kong's future is substantial. The United States
has more than $7 billion in investments in Hong Kong. Over 900 US firms
have offices, and over 21,000 Americans reside there. The United States is
Hong Kong's largest market. Hong Kong is our 14th largest trading partner.
In 1991, US exports to Hong Kong amounted to $8.1 billion, and US imports
were worth $9.3 billion. Put another way, each Hong Kong resident bought a
staggering $1,300 worth of US products last year. American business has a
great deal to contribute to Hong Kong's future. US companies are competing
for contracts in the project to develop the new airport and container
facilities in Hong Kong.
The United States also has a deep interest in protecting human rights in
Hong Kong, as we do throughout the world. Because Hong Kong residents
have long enjoyed respect for their basic human rights, this aspect of the
transition merits the special attention of the United States and the world.
US Policy Toward Hong Kong
We are not here today to discuss MFN [most-favored-nation status] for
China, but I would be remiss if I did not point out that this is the single
most important US trade policy measure affecting Hong Kong. In view of the
increasingly close economic integration of Hong Kong and southern China,
the United States cannot impose prohibitive tariffs on Chinese goods and
imagine that Hong Kong would escape the inevitable serious economic
consequences. Tens of thousands of Hong Kong workers would lose their
jobs, and business confidence would sustain tremendous damage. Such a
step would be inconsistent with Congress' concern for Hong Kong.
That concern has, before today, manifested itself in congressional passage,
with Administration support, of provisions in the immigration act of 1990,
which were specifically directed at Hong Kong. These measures ensured
that Hong Kong would not be amalgamated into China's immigration quota in
1997. The provisions assisted in creating an immigration "safety net" for
Hong Kong by allowing most immigrant visa recipients to delay decisions on
leaving Hong Kong until as late as 2002. These provisions have started to
make a small but noticeable contribution to giving talented Hong Kong
residents the confidence to stay in the territory.
Many of Hong Kong's talented residents have been educated in the United
States, more than 55,000, in fact. Currently, 12,000 Hong Kong residents
are enrolled in American universities. In recognition of these increasing
cultural ties, the US Information Agency is helping establish a Center for
Hong Kong-US Educational Exchanges at the Chinese University of Hong Kong.
We are also working hard to establish a Fulbright program for Hong Kong
residents to come to the United States for academic studies, as Americans
have gone to Hong Kong for years. This would add yet another dimension to
the flourishing existing network of public and private exchanges.
The Administration has also reviewed US export control regulations with a
view toward facilitating export of high-technology goods to Hong Kong. Our
desire is to meet the needs of Hong Kong's increasingly advanced economy
for high-technology goods and make to sure that American companies are
competitive in the Hong Kong market. Once we have fulfilled procedural
requirements, we hope to announce new regulations taking positive steps in
this area.
We have also begun the process of negotiating agreements with the Hong
Kong Government, which we expect to extend beyond 1997. At present, from
civil aviation to extradition, almost every US agreement which relates to
Hong Kong is actually a US-UK agreement applied to Hong Kong. Under
international legal principles, such agreements will lapse with the change
of sovereignty in 1997, absent any specific arrangement otherwise with the
new sovereign.
By building a new framework of agreements in advance of reversion--a
framework more specifically adapted to Hong Kong's circumstances --to
replace existing US-UK agreements, the United States is lending practical
support to the Joint Declaration's goal of preserving Hong Kong's position as
a leading center of international commerce and finance.
McConnell Bill
It is in this context that we support the goal of Senator McConnell's bill of
revising US law to ensure that US legal requirements enable the United
States to continue to interact with Hong Kong after it becomes an special
administrative region of the PRC. In the Sino-UK Joint Declaration, and [in]
its own Basic Law for Hong Kong, China has enunciated a policy of "one
country, two systems" that it will follow with respect to Hong Kong.
However, if left unchanged, our own law might force us to operate on a "one
country, one system" basis, to the disadvantage of Hong Kong after 1997.
The extensive commercial, cultural, transportation, communication, and
other relations that US citizens and companies now maintain with Hong Kong
and its people are possible because, for most purposes, Hong Kong is treated
as a part of the United Kingdom under US law. In a few important areas,
notably the rights and obligations accorded under the GATT and related
agreements, Hong Kong participates and receives favorable treatment (e.g.,
most-favored-nation- tariff rates) in its own right. Finally, for a few
purposes--notably immigration and textile quotas--US law now treats Hong
Kong as a separate territory.
The result of this treatment is that Hong Kong receives most of the
advantages under US law of being part of the United Kingdom, with a few
advantageous modifications that give effect to the territory's economic
autonomy and cultural distinctiveness from the United Kingdom. Most
important, Hong Kong is subject to none of the US domestic legal
constraints that limit our commercial, cultural, and other relations with
the PRC. Statutes now in force set forth mandatory rules that apply to
China by name, or to "states," "countries," or similar terms. These statutes,
which include the Jackson-Vanik provisions and the current China sanctions
legislation, could require the imposition on Hong Kong of restrictions and
disabilities that would be inconsistent with our desire to respect Hong
Kong's promised autonomy from the PRC.
We, therefore, would welcome a bill that establishes clearly the authority
of the US Government to treat Hong Kong, where appropriate, as a non-
sovereign entity which is distinct from the PRC for purposes of US domestic
law. Such a bill would be in full keeping with our intent as a major partner
of Hong Kong to assist the United Kingdom and China in achieving the goals
of the Joint Declaration.
On the question of reports, we recognize Congress' legitimate interest in
developments in Hong Kong as the transition progresses. Indeed, it is our
intention to closely monitor all aspects of the transition process. However,
we believe any report would best focus on US interests in Hong Kong and
changes which result from the reversion to Chinese sovereignty that may
affect our interests. Let me point out that there are many possible changes
resulting from Hong Kong's reversion to the PRC of concern to US interests
which go beyond the scope of the 1984 Joint Declaration. We assume that
Congress would want us to report on such matters.
Bill S. 1731 embodies many of the goals and concepts which we share with
Congress and provides an excellent basis on which to develop a bill the
Administration can support. We have carefully reviewed it and are prepared
to comment on specific points which may require revision in order to
accomplish the bill's intent. We hope to have the chance to work with you
and your staff to address the Administration's particular concerns in S.
1731 and to create a bill that achieves the goals which Congress and the
Administration share. (###)
Dispatch, Vol 3, No 14, April 6, 1992
Title: Suriname Strengthens Civilian Authority
Tutwiler
Source: State Department Spokesman Margaret Tutwiler
Description: Statement released by the Office of the Assistant
Secretary/Spokesman, Washington, DC
Date: Apr, 1 19924/1/92
Category: Speeches, Testimony, Statements
Region: South America
Country: Suriname
Subject: Democratization
[TEXT]
Our Embassy in Paramaribo reports that on March 26 the National Assembly
of Suriname unanimously approved a series of constitutional changes that
remove from the armed forces the political powers that were used to
rationalize the coup d'etat that it staged in December 1990.
We congratulate the Surinamese Government on this historic event which
constitutes an important step toward consolidation of democratic, civilian
rule. In this regard, we commend the statement made on the occasion by
President Venetiaan, who said: "We do not want a military organization
which is going to play a role in politics, in industry, or in labor unions. As
has been demonstrated repeatedly in the past, there are always those who
cannot withstand the temptation to use force of arms in ways not intended
by the people of Suriname."
The United States strongly supports President Venetiaan's Government and
its continued effort to consolidate and strengthen democratic institutions
and promote economic reform.(###)