US DEPARTMENT OF STATE DISPATCH
VOLUME 4, NUMBER 20, MAY 17, 1993
PUBLISHED BY THE BUREAU OF PUBLIC AFFAIRS
ARTICLES IN THIS ISSUE:
1. Export-Import Bank Plays Key Role In Promoting US Exports --
President Clinton
2. Start II Treaty Approval Urged -- Secretary Christopher
3. Situation in Bosnia-Herzegovina -- Secretary Christopher, NATO
Secretary General Woerner, UNSC Resolution, Madeline Albright
4. A New Generation and America's Post-Cold War Challenges -- Deputy
Secretary Wharton
5. US-Russian Meeting on the Situation in the Former Yugoslavia
6. Trade Central to America's Future in the World -- Michael Kantor
7. Fact Sheet: US National Interests and Cooperation With Mexico
8. Fact Sheet: Mexico--A Solid Market Continues To Serve US Companies
9. Summary of Report on 'Patterns of Global Terrorism: 1992'
10. Statements at Confirmation Hearings
Douglas J. Bennet
Elinor G. Constable
John Shattuck
ARTICLE 1:
Export-Import Bank Plays Key Role in Promoting US Exports
President Clinton
Address at a US Export-Import Bank conference, Washington, DC, May 6,
1993 (introductory remarks deleted)
I have thought a good deal about what I wanted to say to you today about
the subject which brings you here. I hope you will understand if I ask
for a few moments to address the situation in Bosnia first, not only
because the national press is here but because you are very much a part
of the world which will be affected by what happens there and how that
impacts our friends and neighbors in Europe and particularly in the
Mediterranean area.
Over the past week, we saw some very encouraging progress toward a
negotiated settlement of the tragic conflict in Bosnia-Herzegovina. Two
of the three Bosnian parties signed the Vance-Owen agreement. The third
party, the Bosnian Serbs, signed contingent on approval by their self-
styled parliament. Progress, unfortunately, was stopped by the Bosnian
Serb assembly's de facto rejection yesterday of the Vance-Owen
agreement. Their action is a grave disappointment to all of us who seek
an early and peaceful resolution to what has been a very brutal
conflict. It abrogates the earlier approval of the peace plan by the
Bosnian Serb leader Karadzic.
Their call for a referendum on the peace plan can only be seen as a
delaying tactic to further consolidate the gains they have made because
of the enormous advantage they have in heavy artillery coming as it does
from the former Yugoslav army. It ignores the reality that everybody
else in the world has recognized--sooner or later, an enduring peace can
only come from good faith negotiations that lead to a peace plan
acceptable to all the parties.
The international community, I believe, must not allow the Serbs to
stall progress toward peace and continue brutal assaults on innocent
civilians. We've seen too many things happen, and we do have
fundamental interests there, not only the United States but particularly
the United States as a member of the world community.
The Serbs' actions over the past year violate the principle that
internationally recognized borders must not be violated or altered by
aggression from without. Their actions threaten to widen the conflict
and foster instability in other parts of Europe in ways that could be
exceedingly damaging. And their savage and cynical ethnic cleansing
offends the world's conscience and our standards of behavior.
Therefore, I have this morning directed Secretary Christopher to
continue to pursue his consultations with our allies and friends in
Europe and Russia on tougher measures which can be taken collectively--
not by the United States alone but collectively--to make clear to the
Serbs that we are embarked on a course of peace and they are embarked on
a costly course.
The vote last night simply makes this Christopher mission more
important. Secretary Christopher will be insistent that the time has
come for the international community to unite and to act quickly and
decisively. America has made its position clear and is ready to do its
part. But Europe must be willing to act with us. We must go forward
together.
Your presence here--your understanding of the importance of exports to
America's future, to the blending of our nation and our culture and our
values with those of like-minded persons throughout the world--should
only reinforce our determination to confine, inasmuch as the
international community can possibly confine, savage acts of inhumanity
to people solely because of their ethnicity or their religion; and to
confine insofar as we possibly can as an international community the
ability of one country to invade another and upset its borders; and
certainly to try to confine this centuries-old series of ethnic and
religious enmities to the narrowest possible geographic boundaries.
That is what we seek. Not to act alone, not to act rashly, not to do
things which would draw the United States into a conflict not of its own
making and not of its own ability to resolve, but simply concerted
action that the international community can and should take to deal with
these issues.
I'll have more to say about it later, but in view of what happened
today, I thought I ought to say this.
Export-Import Bank's Vital Function
For 59 years, since President Franklin Roosevelt created it to help
increase foreign aid and trade with the Soviet Union, the Export-Import
Bank has assisted United States companies to sell more than $270 billion
in our exports all around the world. And now the bank's role in helping
our economy and helping our exports has never been more important. You
are the people who generate an enormous portion of our high-wage, high-
growth jobs. Without expanding our exports, this country cannot grow--
cannot grow economically and cannot create more jobs.
In the global economy which we now are shaped by, we see [that] a
critical part of every economy's functioning is related to its level of
productivity, especially in the export sector. We also know that
America has some special problems entirely of our own making without
regard to what we may or may not think of every aspect of our trade
policy. We have relatively low savings and investment. We have an
enormous budget deficit, which we ran up [by] not investing in
productive investments at home that would produce later wealth, but
largely in increasing consumption.
Indeed, for the last 5 years, the spiraling growth of the government's
deficit has been related almost entirely to paying more for the same
health care and to bigger and bigger interest payments on accumulated
debt. This is a terrible burden on the economic performance of this
country as well as on our future.
Finally, we have--as I said earlier, in putting more of our government's
money to health care--we've also seen more private sector dollars go to
health care, so that now we are spending 35% more of our national
treasure on health care than any other nation in the world, imposing
significant new burdens on American businesses as they seek to compete
within the American market and beyond the American market.
We now, therefore, face an interesting set of challenges, particularly
for a country used to looking for simple answers and dealing with one
issue at a time. That is, indeed, one of the great debates in which I
am engaged here. Some people say, well, you just ought to do one thing,
just reduce the deficit, no matter what. For the last 12 years we were
on a track that, at least at election time, was focused on one thing--
just lower taxes, no matter what. Never mind what happens to the
deficit; never mind what happens to the investment of the country; never
mind what happens to the long-term economic health.
Do we need to reduce the deficit? Yes, we do. Do we also need a
targeted program of investment in the education and training of the
American work force and in the technologies that will shape this economy
into the future? Yes, we do. Do we have anything so far to replace the
steep, steep cuts in defense spending which have gone to the very heart
of a lot of our high-wage, high-tech economy, with many spin-offs
benefiting the commercial economy to date? No, we don't. But we need a
technology policy and a defense conversion policy that attempts to
replace that. So we need to bring down the deficit, and we need a
target program of investments in jobs, technology, and training.
And thirdly, I would argue that we will never reduce the deficit to zero
and never restore fundamental health to this economy until we address
the health care crisis in terms of providing security to Americans and
controlling the cost. And that is obviously a big part of what we're
about up here.
I do not believe we should be forced into the false choice of saying we
must do one or the other. In the past, our governments have come to
people saying, well, we'll just spend money and solve your problems for
you. Or we'll just cut taxes and solve your problems for you. Today,
we have to have a much more disciplined and coherent approach that says
we are going to bring the deficit down, we are going to target
investments and technology and training, and we are going to do
something abut the health care crisis. But we must have an economic
policy that is more than investments, that involves doing the right
things with technology policy, the right things with defense conversion,
the right things with the Ex-Im Bank, the right things to expand our
commitment to exports. Indeed the economy, I think, must continue to be
the number one priority of our country, and, therefore, the number one
priority of this Administration.
Exports Vital to US Economy
The work that exporters and the Ex-Im Bank do to expand jobs and growth
is fundamentally important, because every time we sell $1 billion of
American products and services overseas, we create about 20,000 jobs.
In all, more than 7 million Americans clearly owe their jobs to exports.
And because those workers in export-related jobs make about 17% more
than the average worker, we need more of those jobs.
I have this chart here I wanted to show. It shows that in all
industries, export-related jobs have average hourly wages of $11.69 as
compared with $10.02 for non-export-related jobs. In manufacturing, the
figures are virtually the same--$11.93 to $10.83. And in services, the
margin is even bigger--$11.30 to $9.83. It is clear, therefore, that
one of the answers to the wage stagnation which has gripped the American
economy for almost 20 years now with most hourly wage workers in the
country working longer work weeks for stagnant or lower wages--one of
the answers to that is to increase our exports.
In the last 5 years, exports have accounted for almost half of our
nation's economic growth. Goods and services exports made up 10.7% of
our GDP in 1992, up dramatically from only 7.5% in 1985, just 7 years
earlier.
Your work is important, because if US technology--whether it is related
to the environment, energy, transportation, or telecommunications--is to
secure its pre-eminence, it must have a global reach. Only with world
markets can we afford the research and development to stay competitive.
Export expansion obviously encourages our most advanced industries. I
am committed to promoting these exports, and that's where the Ex-Im Bank
plays an important role.
In FY 1992, the Ex-Im Bank fostered more than 250,000 American jobs that
were an outgrowth of the bank's support for $14 billion in exports.
That's pretty impressive, but it won't be enough just to hold our own
ground. I know we can top that by strengthening the partnership between
our government and the private sector through the Ex-Im Bank. It's
helped to send abroad everything from machine tools to computer
software. It's been at the forefront of the new export industry that
our Vice President has championed, the environmental industry--one that
is so important that I have directed Commerce Secretary Ron Brown to
work with the Ex-Im Bank, the Environmental Protection Agency, and the
Department of Energy to craft a national strategy for environmental
exports. These efforts will not only help to clean up the planet, they
will put a lot more Americans to work.
We have several environmental services exporters with us here today.
One of them, Harza Engineering of Chicago, helped a rural community in
Venezuela fight off the threat of cholera and other diseases by
channeling a fresh water supply. At the same time, it created more than
1,000 jobs for Americans. That's just one case among many.
We want to increase exponentially these successes in all areas of
exports. We can also make ourselves more competitive by streamlining
our programs, an action long overdue. Right now, there are more than
150 different export promotion programs in more than 10 agencies. They
are tangled like a ball of yarn. And our goal is to untangle them.
We want to end the duplication and overlap to make sure all these
programs are customer-driven. We want our guide to be the needs of the
exporters and the lenders.
Our vehicle to a coherent export promotion plan will be the Trade
Promotion Coordinating Committee, an inter-agency group created by the
Congress largely through the efforts of Senator Don Riegle. Secretary
of Commerce Ron Brown chairs the group, which has been meeting daily.
And once he is confirmed, Ken will also have hands-on involvement in
that effort.
With the Department of Commerce and the Trade Promotion Coordinating
Committee, Ex-Im will help lead the way toward developing an export
mentality throughout our government and throughout our nation. At the
same time, the bank will become more of an active, consumer-friendly
bank, one that will get more attention--give more attention to small and
medium-sized businesses. For every applicant, the bank will aim to
bypass unnecessary red tape.
Right now, it takes the staff about 6 months to process a preliminary
commitment application, and only one in six such preliminary commitments
leads to an actual export sale. But with new procedures, the bank will
be able to respond to most requests within 7 days. Now, that's
reinventing government.
The staff will be able to process more cases and support more real
deals. In short, the Ex-Im Bank will use better management measures to
do more without spending more. In these days of deficit reduction, the
bank will have to live within its means like all other government
agencies. But Ken has assured me that he has a number of ways to make
your tax dollars work harder and more effectively.
What we do domestically and how we do internationally are inseparable.
As I said earlier in my remarks, as the Ex-Im Bank builds export markets
abroad, we have to do more to assure that our workers are equipped with
the skills that they need. The average worker will now change jobs
eight times in a lifetime. We have to do a better job of their education
and training.
We need to become better students of economics. The old ways of doing
business simply don't translate into reality today. One of the first
things I did when I became President was to establish a National
Economic Council. It just made good sense to me. We had a National
Security Council that met with the President on a regular basis to deal
with security issues, but a great deal of our security is in the
economic area. And there was no regular discipline mechanism by which
all the economic decisions were considered in terms of their impact on
one another and the United States could develop a coherent policy.
Today, we have that mechanism, and it works. It works well, and we're
working hard to make it work better.
One of the reasons I was so gratified to get congressional approval of
the overall budget plan that I presented in record time--it was the
first time in 17 years that Congress had passed a budget resolution
within the legal mandate--which reduces the deficit by over $500
billion, through spending cuts and tax increases, and there will be not
be one without the other, I can tell you that. I'm not about to raise
your taxes unless the spending cuts are there first--there will be no
budget without both.
This is very important in the export area. I can't tell you how many
years--you probably know this as well as I do--how many years the United
States would show up at some meeting of the G-7 or another international
meeting and all of our trading partners will spend all their time
telling us that we ought to get our financial house in order, we ought
to bring our deficit down, we ought to do something to clean up our own
backyard before we lectured our trading partners about changes in
policy.
Budget Plan Gives United States an Advantage
But now we're in a different position. When I go to the G-7 meeting in
July in Tokyo, the United States will be a success story in the making.
For starters, we have a responsible budget plan that does reduce the
deficit. Our interest rates, as a result, have fallen in many areas to
historic lows, allowing American homeowners and businesses to refinance
with ways that, if we can keep these rates down for a year, virtually
all economists concede will put $100 billion-plus back into this
economy, simply because of lower interest rates.
In this room today, I bet there are scores of people who have refinanced
their home mortgages or been able to have lower business loans as a
result of these interest rates. This is the ultimate stimulus for the
American economy if we can pass the budget that reduces the deficit and
keep these rates down. It is very, very important.
When we can point to these accomplishments, it makes it much easier for
us to work with the Japanese in getting them to stimulate their economy
and buy more exports. It makes it much easier for us to argue to our
friends in Germany that it's a good thing to keep bringing interest
rates down. It makes it easier to try to help work together with a
coordinated economic policy to lift the world out of the economic
stagnation that we now see in Europe and the Pacific, as well as in
North America.
These things are very, very important. But there is more that we have
to do. After 7 years of talks, I would very much like to see a
successful completion of the Uruguay Round of the GATT by December 15.
World economic prosperity depends on it. It's the foundation of the
global trading system. A few days ago, I met with the finance ministers
and the central bakers of the G-7 nations, and I told them that the
United States was prepared to make extraordinary efforts to complete the
Uruguay Round successfully--that we were willing to go the extra mile in
doing that, but we needed their help and support. And I hope we will
get it.
The GATT agreement would be a blessing for US exporters because it will
lower foreign tariffs, curb subsidies that tilt the playing field, and
strengthen the protection of intellectual property, the piracy of which
costs our companies about $60 billion a year. In the GATT and in all of
our trade talks, we have put our trading partners on notice that I
expect access to their markets comparable to the access we want to
extend to them. But we welcome foreign products and services and
investments here, as long as our products, services, and investments
have a chance to be welcomed in other countries as well. It's fair and
it's good business.
These are the principles that will underscore not only our multilateral
but our bilateral relationships as well. With the right markets at home
and the right rules in the international markets, our export
opportunities are virtually limitless.
Support for NAFTA
I want to say a special word about our opportunities in our own backyard
in Latin America. Latin America is reining in its debt, and what is
emerging from a more stable economy is a populace clamoring for consumer
products and entrepreneurs who are shopping for capital goods. It's a
market for our exports that is growing at three times the rate of any
other market in the world. That is why I strongly support the North
American Free Trade Agreement, with the supplemental agreements we are
presently negotiating with Canada and Mexico relating to labor and the
environment.
NAFTA will help us unlock a market that will create hundreds of
thousands of high-paying jobs. And NAFTA, therefore, is a high priority
for this Administration. The reason it is so controversial is that the
American people have seen 12 years in which their wages have gone down
and 3 years in which we actually have fewer private sector jobs. And
everybody is afraid of change. But the only way a rich country can grow
richer is by exporting more and by having more partners and economic
progress. And if we can make this agreement with Mexico work, then we
can move forward to the other market economies of Latin America, to
Chile, to Argentina, to any number of other nations who want to be a
part of this kind of partnership. I think it is very, very important.
Just listen to this: Exports to Canada already support 1.5 million
American jobs. And in the past 5 years, the number of American jobs
tied to Mexico has grown from 300,000 to 700,000 jobs, almost
exclusively because of the unilateral reduction of trade restrictions by
Mexico, which have allowed the volume of trade two-way to go up and the
trade deficit to be erased. These are very encouraging signs. We
project another 200,000 good jobs if we can have a successful
implementation of the NAFTA process.
Mexico is a valued customer for another reason. We also believe that
this new economic thinking, if it works, will help to spread all across
the developing world. We know that there is an impressive array of
political and economic leaders in Mexico, and I know that Secretary of
Finance Pedro Aspe is with us today. I want to welcome him and extend
my best wishes to President Salinas for our emerging partnership.
Emerging Countries in Asia
Outside this hemisphere, I think we have to look increasingly to the
newly industrializing countries of Asia. I know we have someone here
from Indonesia. Indonesia is the fifth- biggest country in the world.
Indonesia is now the leader of the non-aligned nations. They have a
resolution on Bosnia actually being debated in the United Nations today.
Maybe they can figure out how to do a better job with this.
We have enormous opportunities there. When I go to the G-7 meeting in
Japan, I'm going to meet with the President of Indonesia to send a
signal to the nonaligned nations, to the emerging nations of the world,
that the United States wants to be their partner in new trade relations,
that there are all kinds of things that we can continue to do that we
have not done before.
Finally, let me say just a little word about Russia. The bank is now
setting out to do what it was originally set up to do because Russia may
be able to absorb its efforts.
To date, the bank has approved $205 million in final commitments to
Russia. It's working on an oil and gas agreement framework that could
support as much as $2 billion in American goods and services for
Russia's energy sector. As I told President Yeltsin when we met in
Vancouver, the United States once had a famous citizen named Willie
Sutton who was asked why he as devoting his entire life to robbing
banks, and he said because that's where the money is. In Russia, energy
is where the money is. If we can work it out, we can make a huge
partnership there in ways that are enormously beneficial for the
American economy and good for the Russians as well.
Conclusion
At different junctures in this century, our country has shown itself to
be a catalyst for global reform. We have faced off fascism and
communism. We helped to build the international institutions after
World War II that made so many good things happen in the non-communist
world, and now, because of the collapse of communism, are coming into
their own with real potential to fully flower.
The world of tomorrow will reward those of us who not only have the
values which made these institutions possible but which behave in ways
that will be rewarded in the hard glare of international economic
competition.
I just saw today another set of figures showing that in the first
quarter of this year, there was another huge increase in productivity in
the American manufacturing sector. We want those manufacturers who are
increasing their productivity. We want their workers who are the source
of that increased productivity to be rewarded. I am convinced that the
only way we can do it is by opening markets to the United States and
giving the American people the chance to enjoy the benefits, the fruits
of their labor, and giving other countries the chance to grow through
mutual trade and development.
You are on the front lines of that. I came here to salute you and to
assure you that through the Ex-Im Bank and every other means at this
Administration's command, we will do our best to have the kind of trade
policy that will grow the American economy and benefit the entire world.
(###)
ARTICLE 2:
START II Treaty Approval Urged
Secretary Christopher
Statement before the Senate Foreign Relations Committee, Washington, DC,
May 11, 1993
Thank you, Mr. Chairman and members of the committee. Thank you for the
opportunity to speak to you today about the START II Treaty. As you
both have said, few tasks of the Senate are as important as your
constitutional duty to give advice and consent to the ratification of
treaties, especially this treaty. Today, as the committee and the
Senate begin their consideration of the START II Treaty, we have entered
a new era of US-Russian relations. This historic arms control
achievement, if ratified, would have the paradoxical but positive effect
of moving the arms control process away from the center of the stage in
our relations.
Now, the two former Cold War adversaries are forging a new partnership,
based upon common interests and marked by increasing political and
economic cooperation. This new relationship is what made the START II
Treaty possible. Prompt ratification of the START II Treaty will, in
turn, strengthen and deepen both our national security and US-Russian
relations.
First and foremost, START II is in the national security interest of the
United States. By eliminating the most destabilizing weapons facing the
United States, it will reduce tensions and contribute significantly to
US security. It will solidify the broader cooperative relationship that
the United States and Russia are now building. It will bolster the
partnership between the United States and Russia by encouraging Russia
to strengthen democratic institutions and free markets rather than
focusing on maintaining large and unnecessary nuclear arsenals.
START II is also in Russia's interest. I do not mean to suggest, of
course, that all of our interests and Russia's will converge in all
cases. We will, of course, on occasion disagree, just as we sometimes
disagree with our other friends. But with respect to the ratification
of START II, United States and Russian interests converged to a striking
extent.
Evolving Relations Between the United States and Russia
While the era of confrontation has ended, the central importance of
Russia to US foreign policy continues. No development outside our
borders will do more to help ensure a peaceful and prosperous world than
for Russia to continue the process of democratization and economic
reform.
All of us who support Russian democracy and reform were heartened by the
outcome of last month's referendum in Russia. The substantial turnout
was also compelling evidence that Russian democracy is taking hold and
that the Russian people are prepared to continue the difficult task of
reform.
As President Clinton reaffirmed to President Yeltsin in Vancouver, the
United States stands ready to do its part to help reform and democracy
succeed. That kind of support is fundamentally in America's interest.
No relationship is more important to the long-term security of the
United States than our strategic relationship with Russia.
We have seen the development of a cooperative and constructive
relationship with Russia in many areas. Last week, I was in Moscow for
consultations on the crisis in Bosnia. During these discussions, Russia
pledged that it would participate in the implementation of a negotiated
settlement in Bosnia if an agreement can be reached. The prospect of US
and Russian forces working together as peace-keepers demonstrates how
far this relationship has come.
Ultimately, the success of democracy in Russia and the transformation to
a market economy are the best guarantees of international strategic
stability. The Congress has done much to encourage Russia's movement to
a free market democracy governed by the rule of law. I urge you to
continue that support as the Russian people and their government face
even greater challenges in the months ahead.
START II and the US National Interest
While arms control is only one element of our new relationship with
Russia, it remains a very important one. START II, along with the
initial START Treaty, remains in our interest as we move into the post-
Cold War era. It offers enhanced stability, it fosters transparency and
openness, and it eliminates the first-strike capabilities and strategies
of a bygone era. Its formal, binding structure undergirds the political
elements of our relationship. And the cooperative work necessary to
implement the sweeping reductions will lead to collaboration on other
security issues.
As we consider this treaty, we must be mindful of our former adversary's
capability, in case, by some tragic miscarriage of history, their
intentions should change. This treaty meets that important test.
Should the era of confrontation return, the provisions of START II will
significantly increase stability and, thus, reduce the risk of war.
START II mandates reductions in the strategic forces of the two sides
that would have been unthinkable even 2 years ago. By January 1 of the
year 2003, strategic forces will be cut to one-third of their current
levels. Indeed, if we and the Russians are able to agree on a program
of US assistance in dismantling the strategic offensive arms, these vast
reductions could come even earlier--by the end of the year 2000--which
would be an encouraging milestone for the new millennium.
Mr. Chairman and members, more important than the reductions themselves
is the elimination of the MIRVed ICBMs, especially the heavy ICBMs, the
most dangerous and destabilizing legacy of the era of nuclear
confrontation. Under START II, all of the Russian SS-18 heavy missiles
will be destroyed and all of their silos will be destroyed or converted.
No single act better symbolizes the end of the superpower nuclear arms
race. While economic pressures may well have required Russia to reduce
its strategic offensive weapons in a drastic way, it is the START II
Treaty that will ensure that Russia actually reduces and does so in a
stabilizing way. And it is the START II Treaty that will remove the
issue of strategic force size from the Russian political debate.
As the Chairman has said, START II completes the work of the first START
Treaty. Where the first START Treaty discouraged MIRVed ICBMs, START II
bans them. Where the first START Treaty eliminated half the heavy ICBM
launchers, START II eliminates all of them--and their missiles as well.
At the same time, START II preserves the US force structure needed for
deterrence, and it allows us to adapt our bomber force to our future
needs.
The benefits of START II extend well beyond the United States and
Russia. The deep reductions in US and Russian forces well below START I
levels enhance the security of the other START I parties--Ukraine,
Kazakhstan, and Belarus. START II also supports our efforts to gain
universal adherence to the Non-Proliferation Treaty.
When coupled with START I, the START II Treaty will lead to a world in
which nuclear weapons have been eliminated from all of the states of the
former Soviet Union except Russia. It will also lead to a world in
which the strategic forces of Russia are dramatically reduced and
restructured. START II will complement the political integration of
Russia into the family of nations by codifying a strategic relationship
appropriate for an era of cooperation, not confrontation.
START II and Russian Interests
Enduring treaties must be in the interest of both parties. START II is
such a treaty. I have already mentioned the advantages of the treaty
for the United States, but I've also noted START II is in Russia's
interest as well.
Let me just mention some of the ways in which START II will serve our
mutual interests. START II will bring economic benefits to Russia. It
will allow Russia to avoid the future burden of large strategic arsenals
and the need to invest significant resources to maintain modern
strategic forces at or near current levels. In this way, START II will
facilitate Russia's shift from a military-dominated economy to a free
market economy dedicated to meeting the needs of the Russian people--a
free market economy that also serves as a potential US market. As a
reflection of the new cooperative relationship between our two nations,
START II also represents a political symbol of great importance.
Finally, the START II Treaty will move both Russia and the United States
toward more stabilizing force structures. One of the main
accomplishments is the elimination of the MIRVed ICBMs, traditionally
regarded as a major threat to strategic stability. The less-threatening
forces that will result from the treaty will increase stability and
improve Russia's political relationships with its neighbors as well.
Status of Ratification in the Former Soviet Union
Mr. Chairman, in inviting me to appear today, you specifically asked
that I discuss the remaining obstacles to ratification of the START I
Treaty by Ukraine and the adherence to the NPT Treaty by Kazakhstan and
Ukraine. These developments are crucial, since START II cannot enter
into force until START I has been brought into force first.
The legislatures of Russia, Belarus, and Kazakhstan have already
consented to START I ratification. In approving START I, the Russian
parliament imposed a condition that Russia would not exchange
instruments of ratification until Belarus, Kazakhstan, and Ukraine each
accede to the Nuclear Non-Proliferation Treaty (NPT) as non-nuclear-
weapon states parties. Thus far, only Belarus, as you mentioned, has
approved both treaties. Kazakhstan has ratified START I, and we expect
the Kazakhstani legislature to authorize accession to the NPT Treaty in
the near future.
The Ukrainian parliament has begun hearings on the START I Treaty and
the Non-Proliferation Treaty. Although some Ukrainians are urging delay
in joining the NPT, the Government of Ukraine remains committed both to
START I and to a non-nuclear Ukraine. We have taken a number of steps
to meet the concerns Ukraine has expressed and are looking forward to
having both Ukraine and Kazakhstan complete action on START and the NPT
soon.
Mr. Chairman, just before I came up here this morning, I talked on the
telephone to Strobe Talbott, who is in Moscow today, having returned
from Ukraine. He reports that his conversations in the Ukraine were
encouraging. He was received by the President of the country, who
reaffirmed the intention of the leadership of that country to proceed
with the ratification of START I and accession to the NPT.
Mr. Talbott indicated that the tone of the discussions, he thought, was
improved, although the parliament there continues to have some
difficulties. I was encouraged to find that President Kravchuk will
continue to press for ratification of START I and accession to the NPT
Treaty.
I know that many Members of Congress--of this committee, in particular--
are concerned over the delay. I share these concerns, but I'd like to
put that delay in context for just a moment. I think that all Americans
would rather see a free debate than the rubber-stamped approval of the
Soviet-style legislature. There is a time, however, we all feel, for
debate and discussion, and a time for action. I hope that the time for
action is soon going to arrive in Ukraine for the approval of these two
treaties. Then our two governments can work together on the broader
agenda for cooperation and partnership that we will wish to establish
with Ukraine, a major European nation.
That's essentially the message that Mr. Talbott brought to the
Ukrainians, that we can get over this hurdle of ratification and
accession which was promised in the Lisbon protocols. The relationships
between our two countries can greatly improve.
In any event, I believe the delay on START I is no reason for us to
defer action on START II. START II, after all, reduces the threat to
all of Russia's neighbors by reducing Russian nuclear forces. Thus,
prompt Senate action to approve START II will encourage rapid action on
the part of Kazakhstan and Ukraine.
Summary
As I conclude here, let me say, Mr. Chairman, that regardless of the
outcome of the struggle for democracy and free markets in Russia, START
II dramatically improves the strategic stability by eliminating the
final vestiges of the old Soviet first-strike strategic forces. It is
thus in our interest and, indeed, in the interest of the entire world
that this treaty be promptly ratified.
START II, as you indicated in your comments, Mr. Chairman, is an unusual
treaty, negotiated by one Administration to be ratified and implemented
by its successor Administration of another party. As this committee is
aware, President Clinton warmly endorsed the negotiation of this treaty
and supported its basic concepts before taking office. In the months
since January, we have reviewed the details of the START II Treaty
carefully. That review has convinced us that the treaty is sound and
should be approved without change. Therefore, on behalf of the
President, I urge the Senate to give prompt approval to this important
treaty.
As you know, Mr. Chairman, I'll be followed by many other witnesses on
behalf of the Administration--the Secretary of Defense, the Director of
the Central Intelligence Agency, experts who negotiated the treaty--but
I'll be very glad to try to respond to any questions that you and the
other Senators have. (###)
ARTICLE 3:
Situation in Bosnia-Herzegovina
Secretary Christopher, NATO Secretary General Woerner, UNSC Resolution,
Madeline Albright
Reaction to Bosnian Referendum
Statements by Secretary Christopher and NATO Secretary General Manfred
Woerner, Brussels, Belgium, May 6, 1993.
Secretary Christopher: The decision of the so-called parliament last
night really makes a mockery of the signatures in Athens. It's a grave
disservice to all the people of Bosnia. It makes all the more urgent my
consultations, which I intend to continue. I think there will be a new
focus on those consultations today.
With respect to the proposed referendum, I would not be inclined to
invest it with any legitimacy. It looks to me like another cynical ploy
to accomplish delay while they are rolling up additional territory in
Bosnia. I find the conduct really very unusual, and I must say that I'm
going to remain on the track that I started on at President Clinton's
direction last Saturday, consulting with our allies about new, stronger,
tougher measures.
I've had a good conversation with the Secretary General about these
matters this morning. I must say he shares my view of the seriousness
of the overnight developments, but he certainly is able to speak for
himself. I thank him for his hospitality and friendship, as always.
Mr. Secretary General?
Secretary General Woerner: Thank you, Mr. Secretary of State. We had a
very in-depth discussion, exchange of views on the situation, which is
considered to be very serious, and on possible options.
Our member nations will have to consult here in NATO about further
steps. Of course, we will stay in close contact with the United
Nations, and I hope the international community will now consider
additional measures to come to a solution which stops this terrible war
in former Yugoslavia. And, as the Secretary of State, I am very
disappointed by the vote, and I think it is a blow--a severe blow--to
the efforts to reach a peaceful settlement. We have to continue our
efforts. Thank you very much.
UNSC Resolution 824
(May 6, 1993)
The Security Council,
Reaffirming all its earlier relevant resolutions,
Reaffirming also the sovereignty, territorial integrity and political
independence of the Republic of Bosnia and Herzegovina,
Having considered the report of the Mission of the Security Council to
the Republic of Bosnia and Herzegovina (S/25700) authorized by
resolution 819 (1993), and in particular, its recommendations that the
concept of safe areas be extended to other towns in need of safety,
Reaffirming again its condemnation of all violations of international
humanitarian law, in particular, ethnic cleansing and all practices
conducive thereto, as well as the denial or the obstruction of access of
civilians to humanitarian aid and services such as medical assistance
and basic utilities,
Taking into consideration the urgent security and humanitarian needs
faced by several towns in the Republic of Bosnia and Herzegovina as
exacerbated by the constant influx of large numbers of displaced persons
including, in particular, the sick and wounded,
Taking also into consideration the formal request submitted by the
Republic of Bosnia and Herzegovina (S/25718),
Deeply concerned at the continuing armed hostilities by Bosnian Serb
paramilitary units against several towns in the Republic of Bosnia and
Herzegovina and determined to ensure peace and stability throughout the
country, most immediately in the towns of Sarajevo, Tuzla, Zepa,
Gorazde, Bihac, as well as Srebrenica,
Convinced that the threatened towns and their surroundings should be
treated as safe areas, free from armed attacks and from any other
hostile acts which endanger the well-being and the safety of their
inhabitants,
Aware in this context of the unique character of the city of Sarajevo,
as a multicultural, multi-ethnic and pluri-religious centre which
exemplifies the viability of coexistence and interrelations between all
the communities of the Republic of Bosnia and Herzegovina, and of the
need to preserve it and avoid its further destruction,
Affirming that nothing in the present resolution should be construed as
contradicting or in any way departing from the spirit or the letter of
the peace plan for the Republic of Bosnia and Herzegovina,
Convinced that treating the towns referred to above as safe areas will
contribute to the early implementation of the peace plan,
Convinced also that further steps must be taken as necessary to achieve
the security of all such safe areas,
Recalling the provisions of resolution 815 (1993) on the mandate of
UNPROFOR and in that context acting under Chapter VII of the Charter,
1. Welcomes the report of the Mission of the Security Council
established pursuant to resolution 819 (1993), and in particular its
recommendations concerning safe areas;
2. Demands that any taking of territory by force cease immediately;
3. Declares that the capital city of the Republic of Bosnia and
Herzegovina, Sarajevo, and other such threatened areas, in particular
the towns of Tuzla, Zepa, Gorazde, Bihac, as well as Srebrenica, and
their surroundings should be treated as safe areas by all the parties
concerned and should be free from armed attacks and from any other
hostile act;
4. Further declares that in these safe areas the following should be
observed:
(a) The immediate cessation of armed attacks or any hostile act against
these safe areas, and the withdrawal of all Bosnian Serb military or
paramilitary units from these towns to a distance wherefrom they cease
to constitute a menace to their security and that of their inhabitants
to be monitored by United Nations military observers;
(b) Full respect by all parties of the rights of the United Nations
Protection Force (UNPROFOR) and the international humanitarian agencies
to free and unimpeded access to all safe-areas in the Republic of Bosnia
and Herzegovina and full respect for the safety of the personnel engaged
in these operations;
5. Demands to that end that all parties and others concerned cooperate
fully with UNPROFOR and take any necessary measures to respect these
safe areas;
6. Requests the Secretary-General to take appropriate measures with a
view to monitoring the humanitarian situation in the safe areas and to
that end, authorizes the strengthening of UNPROFOR by an additional 50
United Nations military observers, together with related equipment and
logistical support; and in this connection, also demands that all
parties and all others concerned cooperate fully and promptly with
UNPROFOR;
7. Declares its readiness, in the event of the failure by any party to
comply with the present resolution, to consider immediately the adoption
of any additional measures necessary with a view to its full
implementation, including to ensure respect for the safety of United
Nations personnel;
8. Declares also that arrangements pursuant to the present resolution
shall remain in force up until the provisions for the cessation of
hostilities, separation of forces and supervision of heavy weaponry as
envisaged in the peace plan for the Republic of Bosnia and Herzegovina,
are implemented;
9. Decides to remain seized of the matter.
VOTE: Unanimous (15-0).
US Explanation of Vote On Resolution 824
Statement by US Permanent Representative Madeleine K. Albright, New York
City, May 6, 1993.
We had hoped to be able to vote in the Council today on a resolution
that would at long last begin the long road back to peace in Bosnia-
Herzegovina. Instead, we are voting on a resolution to halt Serbian
aggression. Once again, the Bosnian Serb leadership has thumbed its
nose at the values that every one in this room holds dear. As Secretary
Christopher said in Brussels earlier today, the decision of the so-
called Bosnian Serb parliament has made a mockery of the signatures in
Athens. We are not inclined to invest the proposed referendum with
legitimacy, as it appears to be another cynical ploy to delay while the
Bosnian Serbs continue to roll up additional territory. As a result,
our focus will continue to be on the new, stronger measures President
Clinton has decided on.
I ask my fellow Council members to reflect briefly on the irony of what
has transpired over the past week. On Sunday, in Athens, the self-
styled leader of the Bosnian Serbs, Radovan Karadzic, signed the
remaining portions of the Vance-Owen agreements. He conditioned his
signature, however, on the approval of the so-called Bosnian Serb
parliament. This unelected group of dubious characters declined to
ratify the agreements, instead calling for them to be put to a
referendum at some point later this month.
We are thus faced with the self-declared parliament of a self-declared
leader stating that it needs the agreement of the "people" to stop the
killing for which they are themselves to blame. We have no doubts that
those responsible for war crimes will be allowed to participate in the
referendum if it ever occurs. We doubt, however, that those who have
been forced from their homes at gunpoint will be allowed to participate.
We know that those who now enjoy the peace of the grave will not
participate. This is not democracy in action; this is simply a ruse to
buy time for further territorial conquest.
Let us be honest. The current resolution is a palliative; the only
solution is for the Bosnian Serbs to agree to peace, to live in
tolerance of their neighbors, and to give up for judgment those who have
plunged their country into war and fouled the good name of the Serbian
people. Let me remind the Bosnian Serb leadership that my government
has in recent days made it clear that we are consulting with our allies
about new, stronger, and tougher measures. Their implementation, or
lack thereof, of this and all other relevant Council resolutions in the
next days will determine whether we and the rest of the international
community decide that the use of force is inevitable. (###)
ARTICLE 4:
A New Generation and America's Post-Cold War Challenges
Deputy Secretary Wharton
Commencement address to the graduating class of American University,
Washington, DC, May 9, 1993
I am delighted to be here for several reasons. First, there is nothing
more joyous than celebrating and congratulating a graduating class--so
congratulations! Second, my wife and I are long-time friends of
President Duffey and his spouse, Anne. Third, even though I am a
graduate of a rival school--SAIS--you have honored me. And fourth, you
have given me an opportunity to reflect on certain aspects of US foreign
policy.
When President Clinton spoke here earlier this year, he outlined the
post-Cold War challenges and opportunities facing our nation. He called
on all of us to support a program of enlightened American leadership in
world affairs. President Clinton's words of hope and concern at the
centennial of this university struck a personal chord for me. He
rightly said that the world has not been at a comparable turning point
since the late 1940s.
In 1947, it was my class at Harvard that was graduating. Secretary of
State George C. Marshall was our commencement speaker. His message was
brief and compelling. It changed my life. That day, I became convinced
that assistance would be critical to constructive global change and a
stable international order. And, I have been involved with development
ever since.
At a time when the Cold War was looming and military tensions were
rising, Marshall launched the plan for European recovery and opened the
possibility of a more hopeful path for Europe and the world. The
Marshall Plan was, at its core, a message of hope and a call to
partnership. "Our policy," Marshall said, "is directed not against any
country or doctrine but against hunger, poverty, desperation and chaos.
Its purpose should be the revival of a working economy in the world so
as to permit the emergence of political and social conditions in which
free institutions can exist." Marshall went on to ensure that any
government that was willing to assist in the task of recovery would find
full cooperation from the United States. It was a hinge-point in
European and world history. Tragically, fatefully, Russia turned away
from that colossal opportunity, and the global promise of Marshall's
broader vision was deferred for over 40 years by the realities of the
Cold War.
Today, in every sense of the word, is a new, hopeful day. Forty-six
years late, Russia has decisively rejected communism and world
domination and has taken up our offer of hope and partnership. We have
the rare opportunity to extend our post-war partnerships with Europe and
Japan to the whole of Russia and Eurasia. And, like my generation did
in our day, your generation--indeed, the entire international community-
-stands at a new hinge-point of history. One world--the bitterly
divided world of the Cold War--has been left behind. A new world is
before us--facing major challenges from poverty, nationalism, other
forces unleashed by the demise of communism, and extremism of all kinds.
But it can be made whole through the powers of democracy and economic
freedom. Your generation can help make it happen. Exciting
opportunities for promoting democracy, prosperity, and peace are open to
you. And new perils abound as well.
Let me begin with the defining features of the post-Cold War environment
and the difficult questions they pose.
One, with the demise of communism, there is no longer any serious
challenge to the efficacy of democratic principles of government and
market economics. But how can we help the new democracies, especially
the newly free states of the former Soviet empire, overcome the
devastating legacy of command or centralized state enterprises and
communism's political and economic failure?
Two, as the only country now capable of projecting its military power
anywhere in the world, what is the national interest "template" that we
should use in deciding our foreign policy priorities? What criteria
should we employ in seeking to protect our fundamental goals and
interests? As the superpower, just how broad and inclusive is our
national interest and world leadership responsibility? Does our
leadership status bring with it certain moral imperatives that transcend
narrower political or economic national interests? For example, we have
been agonizing over whether we have an obligation to take the lead in
Bosnia, when others closer to the scene have been unable to end the
tragedy there.
Three, bipolar, East-West dynamics no longer drive policy nor serve as
an adequate justification for foreign aid. But how do we help ensure
that Cold War divisions are not replaced by new gulfs between the stable
and prosperous "haves" and "have nots" wracked by political upheaval and
economic chaos? Further, what are the implications of the bipolar
demise for North-South relations? And what is our responsibility for
the persistence of poverty, whether in Somalia or Haiti, or in our own
inner cities and depressed rural areas?
Four, increasing differentiation among the developing countries has seen
Africa, at one end of the spectrum, lose economic ground. At the other
end, some of the newly industrialized countries are now world-class
economic actors. Across this spectrum, what is the most effective,
efficient use of our technological prowess and our limited financial
resources as we seek to pro- mote greater democracy, prosperity, and
stability worldwide? Moreover, when and how do we determine that a
friendly country no longer qualifies for development assistance,
security assistance?
Five, the threat of massive Soviet attack has dissipated, but other
dangers abound: instabilities spawned by the collapse of empires,
ethnic antagonisms, arms proliferation, and threats posed by the
dangerously irresponsible. At the same time, international
relationships and institutions are no longer locked in a Cold War
catacomb. How can we seize this moment to promote multilateral problem-
solving? How do we configure ourselves to manage, resolve, and even
prevent threats stemming from internal ethnic, religious, and political
strife? Ethnic and religious violence is spreading across the globe
like the Black Plague of old--Bosnia, Sri Lanka, Nagorno-Karabakh,
Sudan--each day seems to increase the list. What is our moral
responsibility to combat this plague? And how can we protect our own
democratic traditions rooted in multicultural visions of a melting pot
and promote these to help other nations cope with their own explosive
diversities?
Six, environmental degradation, rapid population growth, terrorism, drug
trafficking, epidemics, mass migration, and refugee flows are
transnational concerns carrying consequences across the board in human,
political, economic, and security terms. How do we adapt traditional
diplomacy to deal with these global concerns? Can we find mechanisms
which protect national sovereignty yet allow for successful collective
solutions?
Seven, economics has gone global, too, with new economic powerhouses on
the scene; interconnected systems for finance, trade, and
communications; and, increasingly, multinational firms and products.
Regional economic associations and a growing sense of economic rivalry
between nations are also evident. How can we better coordinate national
and international economic policies in the face of growing
interdependence? How do we simultaneously find new ways to open
markets, avoid protectionist backlash, and assure that America has a
competitive edge in this challenging global marketplace? I realize that
those of you looking for jobs can take little comfort in our superpower
status. Nevertheless, that very status must be based on economic
strength. Unless we are able to compete with Europe and Asia
economically, it is inevitable that we will no longer be a superpower in
any sense.
Eight, and finally, ours is a complex, interconnected, multipolar world
in profound transition. And these are tight budgetary times. In this
challenging new context, how do we make the best allocation and use of
our limited resources while exercising effective US leadership? How can
we wisely decide the tradeoffs between dollars for our own urban renewal
and dollars for the reconstruction of war-torn foreign lands?
These are some of the major questions we confront in the new post-Cold
War era. Finding the answers is an awesome and, yet, exciting
challenge. It is particularly a challenge to your generation, for the
answers will not come quickly but require extended and intense study,
planning, experimentation, and implementation.
In considering them, however, there are two broad conclusions which are
already clear. The first is that domestic and foreign policy are
inexorably linked. The second is that a priority emphasis on people is
absolutely central to any solutions.
President Clinton has recognized that the development of foreign policy
is an integral part of domestic policy. It is a recognition that the
domestic economy and the welfare of the American people cannot be
strengthened in isolation; that our ability to be a major participant
and influence in global interdependence is a crucial element in
achieving his domestic goals.
Thus, US foreign policy must encompass the critical bond between our
domestic economic, social, and political health with that of the rest of
the world. All our foreign assistance efforts must be conditioned on
this central reality. Moreover, these efforts constitute a commitment
to invest in the human capital of recipient nations, thereby building a
strong, permanent human infrastructure that will support the building
blocks of democracy and a free market economy.
At home, we must get our own economic house in order. American economic
renewal will lend new authority to our foreign policy and strength to
our security partnerships. It will provide new trade opportunities for
nations attempting to overcome the legacies of authoritarian governments
and centrally planned economies, even as it generates growth at home.
Equally important, our commercial partnerships with reforming nations
will result in new partnerships that enable us to better protect the
global environment from transnational scourges. In turn, fostering
conditions under which people-power and human rights can thrive will
improve long-term prospects for sustainable peace and economic
development.
Second, President Clinton's commitment to "put people first" is a
guiding principle of both our domestic and foreign policy. It is based
on the belief that:
-- Americans have an undying vision of political and economic freedom.
We believe in the rewards of hard work and initiative. We see community
as the foundation of democratic society.
-- We believe that American men and women are the key to an economy
that produces good jobs and high quality goods and services--goods and
services that can compete in the global marketplace. To remain
competitive, all Americans must be empowered to perform to their fullest
capacity.
-- Most important of all, we believe that protecting and promoting the
human rights of men and women is the first duty of domestic government.
The creativity and entrepreneurial spirit of the individual in a free
society is the engine of economic dynamism worldwide. In broad
geopolitical terms, "putting people first" means a world community
committed to liberal democratic and free market values.
Ladies and gentlemen, 46 years ago, George Marshall's commencement
address inspired me to join the cause of development as a critical
dimension of foreign policy. Today, I have tried to give you a sense of
the exciting foreign policy challenges we face--you face--in this new
era.
To meet these challenges, we are counting on the rising generation of
educators, scientists, business people--people like you. If the next
century --your century--is to become an era of unprecedented growth and
well-being, we need you. Your commitment and involvement can make a
critical difference.
As you do so, I ask that you always keep in mind that successful answers
must reflect a framework of values that places the sanctity and
aspirations of the individual human being at the heart of what the US
role in the world should be. We have to, once again, begin seeing the
world as a planet of human beings--not as abstractions tied solely to
national security concerns such as nonproliferation or nationalism and
ethnic hatreds or gaining trade advantage. We must recognize that it
all begins with people, including each and every one of you. (###)
ARTICLE 5:
US-Russian Meeting on the Situation in The Former Yugoslavia
Joint US-Russian press release, released by the Office of the Department
Spokesman, Washington, DC, May 5, 1993.
Secretary of State Warren Christopher of the United States of America,
visiting Russia on behalf of President Clinton, was received today by
President Boris Yeltsin of the Russian Federation and also conducted
talks with Minister of Foreign Affairs Andrei Kozyrev. These were
positive and important meetings on the situation in the former
Yugoslavia. Three major points were agreed upon.
-- They emphasized the importance of the partnership that has developed
between the United States and Russia. They reaffirmed their
determination to continue working closely together to achieve a peaceful
resolution of the tragic conflict in the former Yugoslavia, including an
ongoing dialogue and appropriate meetings at the ministerial level.
-- The signing of the Vance-Owen plan by all parties to the Bosnian
conflict is an important step in the coordinated efforts of the world
community, including Russia and the United States. The United States
and Russia strongly urge the Bosnian Serbs to approve and implement the
Vance-Owen plan. They call upon all parties to act according to its
provisions. If the Vance-Owen plan is approved by the Bosnian Serbs and
all parties act in a way consistent with its provisions, the United
States and Russia will work together to implement the plan and put in
place the appropriate peacekeeping measures under the auspices of the
United Nations. The United States and Russia also are prepared to
commit appropriate military forces of their own to assist in these
peacekeeping endeavors.
If, however, the Vance-Owen plan is not accepted and implemented, the
United States and Russia will immediately resume their discussion on new
and tougher measures. No measures are prejudged or excluded from
consideration. (###)
ARTICLE 6:
Trade Central to America's Future in the World
Michael Kantor, US Trade Representative
Address before the National Press Club, Washington, DC, May 5, 1993
A little over 2 months ago, at American University, President Clinton
set forth his vision of America's role in the global economy. It is a
vision rooted in the belief that we are at the third great moment of
decision in the 20th century.
"Will we repeat the mistakes of the 1920s or the 1930s by turning
inward," he asked, "or will we repeat the successes of the 1940s and the
1950s by reaching outward . . . ?" His answer was clear: We will reach
outward and adapt to the new global economy. We will compete, not
retreat.
Trade is central to the President's vision of America's future in the
world. Trade is not an abstract concept. Trade means money in people's
pockets. Trade means jobs. Trade means that working men and women in
Raleigh, North Carolina, make and sell electrical products for computers
in 70 countries. Trade means that a minority-owned company in
California exports electromechanical products to five countries. All
over this country, trade means that working people can put dinner on the
table and support their families.
The benefits of trade are not limited to the United States. As the
President went on to declare in his speech at American University, the
fabric of commerce will also shape global prosperity: ". . . for now
and for the foreseeable future," he added, "the world looks to us to be
the engine of global growth and to be the leaders."
We can't live up to the twin tasks of American prosperity and global
leadership unless we are competitive. The Clinton Administration is
committed to making America competitive. We can only be competitive if
trade policy is an integral part of economic policy.
Gone are the days when this nation could subordinate trade concerns to
"national security" in the traditional sense of the term. The strategy
of containment was appropriate during the Cold War, but it was a static
strategy, aimed at halting Soviet expansionism. In those years, we
worried about the "doomsday clock"--with hands perilously close to the
midnight of nuclear war. For a long time, our strategy was mutually
assured destruction.
Today our challenges are dynamic, not static. Economic strength,
founded on human resources and nourished by trade, is a pillar of
national security in this new Post-Cold War age. Our security
interests--and those of others--are inextricably linked to the growth
and fairness of the global trading system.
Economic policy begins with the President's domestic economic program.
The challenges are enormous. Unemployment is still at 7%. More than 1
in 10 Americans is on food stamps. More than 16 million people are
looking for full-time work and having no luck at all.
We must provide American workers with the training they need for good
jobs in the industries of the future. We must reduce our structural
deficit. We must provide American enterprise with the capital it needs
to expand and compete. And we must provide the American economy with
the stimulus of a thriving global marketplace.
The goals of the Clinton Administration's trade policy are clear. We
want to open more foreign markets. We want to do more business with
those whose markets are already open. We want to eliminate trade
barriers that are raised against us and others.
We need to build faith in the international trading system. Too many
people in the American public think that trade hurts them, that trade
may take away their jobs. The truth is the opposite.
The numbers speak for themselves. Every billion dollars of exports
creates 20,000 new jobs in the United States. There are now more than 7
million Americans whose weekly paychecks are related to and dependent on
merchandise exports alone. A majority of those people work in the
manufacturing sector, and they earn almost $3,500 per year more than the
average American worker.
And when jobs in the service sector are oriented toward trade, they also
provide workers with valuable incentives. The average salary for a
service worker in the export field is estimated to be 20% higher than
the average service worker's salary.
So trade means the hands of the clock move forward, toward higher wages
and better jobs for working Americans. Take Ron Thomason, a materials
expediter at Caterpillar's large bulldozer assembly plant in East
Peoria, Illinois. He says, "I owe my job to exports." At the IBM
facility in Rochester, Minnesota, 200 out of 900 people know that their
jobs depend on exports. So do the 18 employees of a process control
company in Tucson.
At the same time, we have the largest open market in the world. We take
the largest share of exports from developing countries. In four major
industries--textiles and apparel, steel, autos, and footwear--the United
States imports from 1 to 10 times as much per capita as Japan. With
this record, Americans want to be sure that no one is taking advantage
of them and that others establish and maintain comparably open markets.
To achieve our trade goals we will use all the negotiating tools at our
disposal. We will negotiate multilaterally, regionally, bilaterally,
industry by industry. We insist only that foreign governments respect
our rights under current and future international agreements. And we
will respect theirs. We seek mutuality of obligation and comparability
of action--terms that mean real partnership and mutual responsibility.
Americans are sometimes accused of "unilateralism" when we insist on
enforcement of agreements. But holding countries to their agreements is
the opposite. Enforcement strengthens Americans' support for an open
trading system, and it strengthens the credibility of that trading
system as well.
We cannot ask businesses and their workers to take the risks of doing
business in the global marketplace unless we can guarantee that
agreements will be enforced. That is the essence of real partnership
and mutual responsibility. These principles are reflected in each of
our major trade initiatives.
The Uruguay Round. The Uruguay Round is of primary importance because
the General Agreement on Tariffs and Trade--the GATT--remains the
foundation of the global trading system. These negotiations are now in
their seventh year. To restore momentum, we need to make progress in
market access by agreeing to remove the barriers to trade in
manufactured goods, services, and agriculture; and we intend to finish
the Uruguay Round by December 15.
Some are waiting for the US and the EC to show leadership in this area
before making their own contributions. For our part, we and the
European Community have accepted responsibility and have agreed to aim
for an outline on market access. We will only be successful, however,
if others--like Japan and the developing countries--are full
participants.
Recent events indicate that we can work together with the European
Community and move forward to complete the round. Last January, the EC
unilaterally imposed community-wide requirements on government
procurement that discriminated against non-European providers. There
seemed no alternative but to impose sanctions under our law. Last
month, after 2 days of intense talks, the United States and the EC
reached agreement to open up a major segment of that procurement market
to both sides. The EC will remove the discrimination against US
suppliers of heavy electrical equipment. The United States will remove
"buy America" preferences on certain federal power administrations,
including the Tennessee Valley Authority. We will continue to negotiate
on remaining barriers even as we are imposing sanctions for failure to
open the telecommunications market.
The North American Free Trade Agreement. The North American Free Trade
Agreement is a second key link in the trade and economy chain. In
response to the lowering of trade barriers in Canada and Mexico and in
anticipation of NAFTA, trade and jobs are on the rise. Exports to
Canada already support an estimated 1.5 million US jobs. Export jobs
related to Mexico have grown from 300,000 to 700,000 over the last 5
years, with another 200,000 predicted by 1995 if NAFTA with the
supplemental agreements is implemented. These jobs pay about 12% more
than the national average. And for 38 of the 50 states, Mexico is one
of the top 10 customers. Five of the ten states selling the most to
Mexico are northern industrial states. Without NAFTA, the United States
will be unable to lock in and extend these gains.
The current negotiations are addressing several key areas: border
cleanup; commissions on labor and environment, with provisions for
enforcement; import surges; stronger enforcement of national laws; and
promoting higher wages and productivity. In addition, the agreement we
send to Congress will ensure that there is adequate adjustment
assistance for workers.
Looking beyond NAFTA, we see good prospects for additional trade
agreements with successful market-oriented economies throughout the
Americas, beginning with Chile. The combination of political and
economic reform in this region is breathtaking. US exports to the
region are expanding at a rate that is three times the rate of export
growth to the world as a whole.
The Pacific Rim. A high-priority area for this Administration is the
Pacific Rim. We want to serve as a catalyst connecting the Pacific Rim
and the Americas, the two most dynamic regions in the world today. In
1960, the nations of the Pacific accounted for 8.9% of the world's gross
national product. By the year 2000, the figure will be nearly 26%.
Forty percent of current US international trade is with the Pacific
Basin. Last year, trade across the Pacific exceeded trans-Atlantic
trade by 50%.
This year, the United States is chairing the Asia-Pacific Economic
Cooperation forum, known as APEC. Our hope is that APEC will provide
the framework for expanded trade and an increased investment flow
throughout the region. We intend to work with our Asian partners to
further these goals.
When the United States looks to the Pacific, we think first of Japan.
There is no single country more important to our long-term interests.
For well over a century now, history has bound our two nations closely
together. We have been adversaries and allies. Today, our alliance is
fundamental. Our common interests and our common challenges are
extensive. That's why the issues that divide us must be openly
acknowledged; squarely faced; and, ultimately, resolved.
We are now seeking to remove restrictions on access to Japan's
construction and supercomputer markets. These are but two examples of
deep-rooted political, social, and commercial practices and attitudes
that gravely distort the workings of a free and open international
trading system. When Prime Minister Miyazawa visited Washington last
month, President Clinton made it clear that the time has come for Japan
to take more substantial steps to open its market and play a leadership
role commensurate with its economic strength. But we need to make
concrete, measurable progress on a number of sectoral and structural
issues. Japan and the United States have agreed to identify specific
areas for bilateral negotiation when the Tokyo economic summit convenes
in July of this year.
The purposes of our trade policies and actions are the same: to open
markets and create trade opportunities and, in so doing, to boost the
global economy; strengthen the international trading system; and, above
all, ensure that American workers and American companies are and will
remain competitive. Trade is not a zero-sum game; it is an engine of
growth. This Administration will link all the resources at our disposal
to achieve these goals. Whatever programs we have--export promotion,
export finance, trade-related assistance--are tools of a comprehensive
trade promotion strategy.
The trading system and its supporting institutions must adapt to the
realities of the new global economy. We will need new assumptions--a
whole new set of attitudes on the part of the United States and its
trading partners. The fundamental fact is that the globalization of
production and markets has changed the nature of international
competition. Self-sufficiency is not realistic. "Imported" goods are
no longer entirely produced in the exporting country; domestic
production is often involved. Trade and investment are closely
intertwined.
Similarly, domestic policies and regulations have become as important to
the future of trade as trade measures adopted at the border. Domestic
policies have become major competitive factors in world trade.
Governments are competing to create high-wage, high-skill jobs through a
variety of domestic measures. These new realities dictate the need to
address the environment, technology, and competition policies. Each of
them is interrelated with trade, and each challenges our trade
institutions to be more creative, open, and flexible. Addressing them
and other trade issues will require change.
The United States has always been willing to change. We embrace change,
thrive on change, and depend on change. As the President has said, we
must make change our friend. After World War I, we raised trade
barriers, with disastrous results. After World War II, we lowered
tariffs and built global institutions to expand trade and investment
even as we held communism to a standstill.
The end of the Cold War is the third decisive moment in this century.
We have a chance to build a new future and to make it the brightest and
most enduring of all. Instead of a doomsday clock, with hands pointing
toward a nuclear midnight, we want a "growth clock," with hands pointing
toward noon. Instead of mutually assured destruction, we will strive
for mutually assured growth. Together, we need to summon up a small
portion of the wisdom, vision, courage, and sense of joint mission that
our parents showed when confronted with the daunting task of defeating
fascism, containing communism, and rebuilding the postwar world. I
believe we are up to the challenge. (###)
ARTICLE 7:
Fact Sheet: US National Interests and Cooperation With Mexico
For more than 200 years, the United States and Mexico have shared a
continent but not a vision of the future. In the past 10 years, that
has changed dramatically, as US and Mexican political, social, and
economic leaders have realized that cooperation on a wide range of
issues--from economic growth, to the environment, to narcotics control--
benefit both countries.
Consequently, managing the bilateral relationship across the 2,000-mile
border will be a critical US security challenge in the 21st century.
With Mexico, the US Government has been working to address mutual
concerns and will need to expand such efforts in the years ahead. Key
to this cooperation will be the North American Free Trade Agreement
(NAFTA).
Mexico's Importance To the US Economy
Mexico has become one of the most open, market-oriented developing
countries in the world. In the Western Hemisphere, it has become an
economic model for countries within the region and in Central and
Eastern Europe. Recent Mexican economic reforms include reducing
barriers to trade and foreign investment, privatizing most state
enterprises, and improving legal protection for firms doing business in
Mexico.
These reforms have spurred Mexican economic growth and benefited the
United States. Mexico is the third-largest US trading partner and its
fastest-growing major export market. US exports to Mexico have more
than tripled, from $12.3 billion in 1986 to $40.6 billion in 1992.
Furthermore, the United States had a $5.4-billion trade surplus with
Mexico in 1992.
Mexico recently overtook Japan as the United States' second-largest
export market for manufactured goods. Seventy cents of every $1.00 that
Mexico spends for foreign products is spent on those from the United
States. Under NAFTA, the remaining Mexican trade barriers will be
removed, creating new export opportunities for US firms. This also will
increase US employment: Every $1 billion of US exports to Mexico
creates almost 20,000 jobs in America.
Democracy and Human Rights Reform in Mexico
Under President Salinas, political reforms have opened the political
process and have led to significant opposition gains at the national,
state, and municipal levels. While the ruling Partido Revolucionario
Institucional (PRI) still dominates, President Salinas' reforms have
raised public confidence and reduced complaints of significant election
irregularities. Moreover, the Salinas Administration has proposed
further reforms, including a $1-billion nation-wide voter identification
system, changes in campaign financing, and allowing foreign pollsters to
take exit polls at Mexican elections. These steps should reinforce
trends toward greater democracy.
President Salinas also has attacked long-standing problems of government
corruption and worked to improve respect for human rights. In 1990, he
established the National Commission on Human Rights, which is earning
considerable foreign and domestic respect for investigating and
correcting abuses, resolving controversial cases, and reducing official
impunity for abuse of power. The Mexican public increasingly turns to
the commission for assistance in human rights cases.
In January 1993, President Salinas appointed Jorge Carpizo, a former
head of the commission, as Attorney General to address law enforcement
problems. He aggressively is pursuing convictions and sentencing of
officials who are guilty of human rights violations. He also has stated
his commitment to eliminate corruption from the Office of the Attorney
General of the Republic and from the Mexican Federal Judicial Police.
The US supports these efforts to improve professionalization of law
enforcement agencies with technical assistance.
Bilateral Cooperation
Illegal Drugs. The security of the United States and Mexico are
threatened by the scourge of illegal drug use, trafficking, and
production. Mexico shares the US Government's deep concern with illegal
narcotics and supports enhanced bilateral cooperation to stem their
spread to the United States. The Mexican Government has made
significant seizures, especially of cocaine; has stepped up eradication
efforts; and has arrested officials involved in narcotics-related
corruption.
President Salinas has declared drug-trafficking to be a threat to
Mexico's national security. He has made the Attorney General
responsible for anti-narcotics coordination and increased the budget to
combat illegal drugs threefold since 1989. He energetically tackled the
endemic corruption that undermines effective law enforcement and
benefits drug-traffickers. The results have been notable: In 1992,
Mexican authorities seized nearly 40 metric tons of cocaine and 97
kilograms of heroin and eradicated almost 6,900 hectares of opium poppy
and more than 12,000 hectares of marijuana with US intelligence and
logistic support.
Mexico is reforming its legal system to make money-laundering and other
drug-related financial activities crimes and is undertaking a vigorous
asset seizure program. It also broadened drug treatment, education, and
prevention programs to reach its young people.
An active partnership between US and Mexican authorities is vital to
keeping narcotics out of the growing commerce between both countries.
US-Mexico anti-narcotics cooperation has reached unprecedented levels in
policy coordination and operations. The US-Mexico Mixed Permanent
Commission reviews cooperative efforts. The Mutual Legal Assistance
Treaty enhances both governments' ability to prosecute criminals
operating on either side of the border. The countries are coordinating
their efforts to assist Central and South American nations in
implementing drug education and treatment programs. The United States
also supplies helicopters and sophisticated aircraft to Mexico's rapid
response force.
Mexico is a leader in promoting regional cooperation to stop drug-
trafficking. It also has played a key role in anti-narcotics efforts of
the Organization of American States.
US-Mexico Border. Developments along the US-Mexico border significantly
affect cooperation and stability in bilateral relations. For example,
efforts to control criminality and illegal smuggling of goods and people
sometimes have generated tension in this relationship. Border
environmental problems, trade flows, and narcotics-trafficking are other
key issues with "spillover" effects.
However, US-Mexico border relations are increasingly constructive,
cooperative, and fruitful. Local and state officials on both sides of
the border meet frequently to discuss cooperative ways to deal with
shared problems. The US and Mexico joined to provide relief to
thousands of victims of disastrous floods in early 1993.
The Mexican Government created a special border police force, the Grupo
Beta, which successfully has reduced violence by smugglers of illegal
immigrants and effectively has monitored border traffic. Additionally,
Mexico has helped combat illegal migration to the United States by
apprehending more than 123,000 third-country nationals in 1992 (up from
13,000 in 1988), most of whom were bound for the United States. These
efforts helped save millions of dollars spent on detention by the United
States.
Nonetheless, Mexico continues to be a major source of illegal
immigration. About 1.5 to 2.7 million Mexican nationals without legal
status may be residing in the United States. Through US border patrols,
employer sanctions, and other programs, the US Immigration and
Naturalization Service will continue to deal with illegal immigration.
Environment. No issue demonstrates the need to manage issues
cooperatively more than environmental problems which cannot be
constrained by national boundaries. The US and Mexico have a long
history of joint efforts to deal with wide-ranging environmental
problems and natural resource management. Various agreements and
institutions provide the framework for cooperation to protect the shared
environment:
-- The 1944 Water Treaty gave the International Boundary and Water
Commission (IBWC) authority to deal with border sanitation problems, and
several border sewage projects have resulted. The IBWC, which is more
than 100 years old, also is responsible for flood control, for
conservation and division of the use of border water resources, and for
maintaining the international boundary.
-- The 1983 La Paz Agreement is an important, comprehensive framework
agreement with Mexico dealing with transboundary pollution. Through
work groups and specific problem-solving annexes, the La Paz agreement
deals with border air pollution; contingency planning for pollution
accidents; hazardous waste disposal and trans-boundary shipments;
technical assistance and data exchange; and, in cooperation with the
IBWC, water quality.
-- The US and Mexico concluded the Mexico City Environment Agreement in
1989 and a US Department of Energy-Mexican Petroleum Institute
memorandum of understanding in 1990, both aimed at improving the
environment in and around Mexico City.
-- In 1992, the US and Mexico concluded the landmark Integrated
Environmental Plan for the Mexican-US Border Area in a process notable
for its public participation and input. That plan, covering 1992-94,
comprises a detailed review of border conditions and specific proposals
to solve problems. The plan will be updated next year.
-- The two governments also have about 100 joint wildlife/park projects
ranging from conservation and management of migratory bird habitats, to
protecting endangered species such as the jaguar, to research on
tropical birds. Mexico has extensive programs, including the
establishment of 44 national parks, 8 reserves, and 14 biosphere
reserves. It also has joined the Convention on International Trade in
Endangered Species.
Mexico's Role in the World
Mexico has become a regional leader on key issues important to the US,
notably US efforts to promote peace in Central America. Mexico helped
persuade the rebel forces and Government in El Salvador to demobilize
and end their war. Similarly, it has played a constructive role in
encouraging the end to conflict in Guatemala and Haiti. It also has
been an important regional ally in US efforts to combat drug-
trafficking, to improve environmental conditions, to support the growth
of democracy, and to promote more open, market-oriented economies. (###)
ARTICLE 8:
Fact Sheet: Mexico--A Solid Market Continues To Serve US Companies
Following is an article by Rebecca Reynolds Bannister reprinted from the
April 19, 1993, edition of Business America, which is published by the
US Department of Commerce's International Trade Administration.
Mexico is the fastest-growing US export market. Total merchandise
exports to Mexico in 1992 were up 22% to a record $40.6 billion, three
times their level as recently as 1986. While 1993 may not quite
approach last year's impressive growth rate, it is expected that Mexico
will continue to be a stellar market for US products, boosting exports
to the $47-48 billion range.
Last year was a banner year for trade with Mexico on several counts,
especially in manufactured goods. Mexico surpassed Japan as the second-
largest market for US exports of manufactured goods. (The United
States' other North American Free Trade Agreement--NAFTA--partner,
Canada, is the largest market.) At the same time, the United States
trade surplus in manufactured goods with Mexico ($7.5 billion) was the
largest with any country in the world, larger even than that with the
entire European Community. Mexico prefers American products and spends
15 cents of each dollar of per capita income on US goods (compared with
2 cents in Japan and the European Community).
Imports from Mexico also set a record in 1992, increasing 13% to $35.2
billion. Export growth exceeded import growth for the third year in a
row, a phenomenon that is expected to continue next year as well. As a
result, the overall US trade surplus with Mexico widened to $5.4 billion
in 1992 and should improve further next year.
The strong, positive growth in the US trade surplus with Mexico runs
counter to the arguments of some that exports to Mexico are largely
returned to the United States after further processing. Quite the
contrary: Production sharing comprises only about 25% of US exports to
Mexico, and its share is declining. Mexico represents a vibrant market
of 82 million consumers with a preference for US goods--nearly 70% of
Mexico's imports come from the United States. (Compare this to the 22%
US share of imports in Japan and 7% share in the European Community.)
Since reducing its trade barriers beginning in 1986 and undertaking
major economic reforms, Mexico has been on a steady growth course of
roughly 3% per annum for the last 4 years, and this is expected to
continue. Strong growth has increased the demand for capital goods and
equipment as well as consumer goods and agricultural products. It may
surprise some, but even traditionally import-sensitive industries like
textiles, footwear, apparel, steel, and auto parts have found a
receptive Mexican market. The North American Free Trade Agreement
promises to improve this outlook by phasing out and eliminating
remaining barriers. Congress is expected to vote on NAFTA later this
year in order to meet the target implementation date of January 1, 1994.
Some of the Most Promising Mexican Markets
Descriptions of some of the most promising Mexican markets for 1993 and
beyond follow.
Infrastructure. Most exciting for US exporters is the investment Mexico
is making in infrastructure to support the needs of its growing economy.
Mexico's President Carlos Salinas de Gortari has made a major and highly
visible commitment to bring Mexico "from the third world into the first
world'' by the end of the decade. What this amounts to is massive
investment in infrastructure--all kinds, from telecommunications, to
roads and ocean ports, to building and modernizing enough electrical
power plants to effectively service the needs of its growing industry,
to water purification and distribution systems, and to environmental
cleanup infrastructure such as sewage treatment plants and incinerators.
Billions of dollars in private and leveraged public dollars are being
spent this year in what has to be one of the most ambitious national
infrastructure improvement projects in the world. Many of the purchases
of equipment and technology to improve Mexico's infrastructure are from
the United States (33% of US exports to Mexico are capital goods).
Telecommunications. In telecommunications, Mexico is making great
strides to modernize its infrastructure. Telmex, Mexico's privatized
telecommunications company, has embarked on a huge capital investment
program calling for a 63% increase in total infrastructure, with
expenditures of around $13 billion by the year 2000. (In 1991, $1.8
billion was spent; 1992 and 1993 expenditures should total $4.6
billion.) US exports of telecommunications equipment to Mexico totaled
$1.5 billion in 1992.
A concrete example of this upgrade is Hughes Aircraft Company's $200-
million contract for two new communications satellites for the Mexican
Government to be launched in November 1993 and February 1994. (Hughes
built the two satellites that are currently used by Mexico's
Communications Ministry.) This contract will support an average of 250-
300 jobs over 36 months in Hughes Aircraft's Long Beach [CA] facility
and various US subcontractors.
Related to the Telmex modernization, Jefa International, a Native
American-owned radio telecommunications service company, recently won a
multi-million-dollar, multi-year contract with Telmex's Telcel cellular
company to engineer and install the cellular microwave interconnect
system for several Mexican cities.
Energy. Big changes are also happening in Mexico's energy sector.
Market liberalization, which has been so dramatic in most segments of
the Mexican economy, has been slow to reach the energy sector, largely
because Mexico's constitution restricts ownership of oil and gas
resources and control over electrical power generation to the state.
Nevertheless, changes are being made in response to demands for more
efficient and reliable energy. It is estimated that Mexico will have to
invest $20 billion to $30 billion by the year 2000 to upgrade its energy
capabilities.
In June 1992, the Mexican national oil company, PEMEX, reorganized its
operations into four separate subsidiaries: an exploration and
production unit, a refining unit, a natural gas and primary
petrochemicals unit, and a secondary petrochemicals unit. Other
internal reforms within PEMEX indicate that there is a willingness to
explore creative methods of working with foreign suppliers/contractors
in order to move to the level of production and efficiency in energy
services that Mexican producers need to compete. These changes,
combined with the market access achieved in NAFTA, promise new
opportunities for US firms.
In 1992, US exports of chemicals to Mexico totaled $3.2 billion. NAFTA
eliminates import and export licenses on all petrochemicals, except for
five remaining "basic'' petrochemicals reserved to Mexican state
control.
In the area of electrical power generation, NAFTA provides new
investment opportunities for electricity-generating facilities for "own
use,'' co-generation, and independent power production. It allows NAFTA
investors to acquire, establish, and operate such facilities without any
involvement from the state energy monopoly, CFE. Investors may also
purchase or build independent power production (IPP) facilities.
A recently announced $675-million contract between General Electric and
Bechtel and Mexico's Federal Electricity Commission to build a 700-
megawatt electrical power plant is a big success story, resulting from
Mexico's push to modernize and expand its energy grid. The fact that
these two US companies are committed corporate citizens in Mexico and
that they formed a consortium with a major Mexican
engineering/construction firm, ICA, gave them the knowledge to present a
winning bid. This contract alone will directly result in 1,000 jobs in
New York and South Carolina over the next 3 years.
Procurement. Although Mexico has privatized nearly all state-owned
enterprises, government purchases still represent a major market
opportunity. However, except for those purchases involving multilateral
lending, there is no requirement to open government procurement to
foreign bidders today. New rules on NAFTA government procurement will
open up opportunities to US firms seeking government contracts in Mexico
and Canada. NAFTA gives North American suppliers immediate and growing
access to the Mexican Government procurement market, not only in
parastatal firms such as PEMEX and CFE (national electric company) but
other government entities. NAFTA also breaks new ground by including
services for the first time, substantially increasing export
opportunities for North American providers of a wide variety of
services--construction, environmental, and software to name just a few
areas.
Environmental Products and Services Market. Mexico spends the
equivalent of 1% of its gross national product on environmental
improvement. In 1992, the total market for pollution control products
and services in Mexico was approximately $1 billion. Average growth of
the Mexican pollution-control products and services market is expected
to reach 20% per annum through 1994, and US exports of environmental
products and services to Mexico are expected to grow by 20% during 1993.
Currently, very few non-tariff barriers impede sales of US pollution-
control equipment and services in Mexico. Tariffs on pollution-control
equipment and services range from zero to 20%. Under NAFTA, tariffs on
most pollution-control equipment will be eliminated on the date of
implementation of the agreement or within 5 years of implementation,
stimulating US exports by further enhancing the relative price
competitiveness of US pollution control and equipment vis-a-vis non-
NAFTA products.
Continued growth of the Mexican economy, spurred by NAFTA, will
encourage increased sales of new US pollution-control equipment and
services in Mexico as citizens demand a cleaner environment and the
financial resources exist for these purchases.
Increasingly strict Mexican enforcement of its sweeping 1988 General Law
of Ecological Equilibrium and Environmental Protection will necessitate
diligent maintenance of existing environmental control equipment.
Mexico's recent intensification of enforcement of its environmental laws
is also contributing to increased sales of US environmental products and
services in the Mexican market. In 1992, Mexico created a new super-
agency, the Secretaria de Desarrollo Social (SEDESOL), which is
empowered to set and enforce Mexico's environmental norms and
regulations. Notable increases in both the number of SEDESOL inspectors
employed and the frequency and seriousness of their inspections have
made compliance with Mexican environmental law a high priority for firms
operating in this market. Implementation of NAFTA is likely to
reinforce this trend by strengthening enforcement efforts and by
generating additional resources in Mexico to address environmental
problems.
Services. The market for services is another very important new
opportunity under NAFTA. The agreement opens Mexico's $146-billion
services market for US telecommunications companies (both equipment and
services); banks; insurance, law, and accounting firms; and
transportation companies. To make it possible for service providers to
have real access to these markets, NAFTA allows professionals to cross
the border. This means, for example, that an equipment vendor can offer
follow-up services to its clients--a very important advantage when it
comes to sales.
Export Assistance Services
To join the expanding ranks of successful small, medium, and minority
firms that have added Mexico to their sales base, tap into these
Department of Commerce services.
-- For quick answers about the Mexican market, call the Commerce
Department' s Flash Facts Information Hotline. Over 1,000 businesses
call this resource hotline 24 hours a day, 7 days a week to order Mexico
market information that is sent via fax. Call (202) 482-4464 and order
the Flash Facts Menu (Document #0101) to see what you can learn about:
NAFTA, tariffs, permits, and customs regulations; marketing,
distribution, and finance; statistics; and even tips for traveling in
Mexico.
-- If you are interested in Trade Shows and Direct Marketing Help in
Mexico, the US Trade Center in Mexico City provides a range of services
to promote US exports to Mexico. The Trade Center provides facilities
for exhibiting products, as well as market research and other services.
In addition, the Trade Center's facilities are available for private
business-sponsored events such as product promotions, sales meetings,
product demonstrations, seminars, and workshops. Eleven trade events
are scheduled at the center between April 1993 and March 1994. For
further information, contact the US Trade Center at (011-525) 591-
0155.(###)
ARTICLE 9:
Summary of Report on 'Patterns of Global Terrorism: 1992'
Department Statement
Statement by Department Spokesman Richard Boucher, Washington, DC, April
30, 1993.
Today the Department of State submitted to Congress its annual report,
"Patterns of Global Terrorism: 1992." Copies of the report are
available in the press office.
The report covers international terrorist and counter-terrorist activity
for calendar year 1992. It does not cover events that have taken place
this year.
Among the main points:
-- International terrorist attacks declined last year to the lowest
level since 1975;
-- US casualties from acts of terrorism were the lowest in a single
year since 1968. Two Americans were killed and one was wounded during
1992.
-- Iran and Iraq were the most active state sponsors of terrorism last
year. Other sponsors were largely quiescent.
-- Today's report contains no changes to the so-called "Terrorism
List." However, we continue to monitor behavior by Pakistan and Sudan
closely.
The report also notes that, despite the dramatic drop in terrorist
attacks, we must remain vigilant to counter the threat.
Excerpts From Report
Following is the text of the "Year in Review" and "State-Sponsored
Terrorism Overview" from Patterns of Global Terrorism: 1992, released
April 1993. The Department's Office of the Coordinator for Counter-
terrorism released the report, which is available through the Office of
Public Liaison, tel. 202-647-9658. It also is available electronically
through GPO's Federal Bulletin Board (see inside back cover for more
details).
The Year in Review
One of the largest one-year decreases in the number of international
terrorist incidents since the United States began keeping such
statistics in 1968 occurred in 1992. International terrorist attacks
declined during 1992 to the lowest level in 17 years. This is roughly
35% fewer than the 567 incidents recorded in 1991, a figure that was
inflated by a spate of low-level incidents at the time of the Gulf war.
During 1992, US citizens and property remained the principal targets
throughout the world; nearly 40% of the 361 international terrorist
attacks during the year were directed at US targets.
US casualties from acts of terrorism were the lowest ever. Two
Americans were killed* and one was wounded during 1992, as opposed to
seven dead and 14 wounded the previous year:
*Five American missionary nums were brutally murdered in Liberia in two
separate attacks during 1992. We have not included the murders as
terrorist attacks because a political motivation appears to be lacking.
-- On 8 January 1992 naturalized US citizen Jose Lopez was kidnapped by
members of the National Liberation Army in Colombia and subsequently
killed.
-- On 10 June, Sgt. Owell Hernandez was killed in Panama when the US
Army vehicle he was driving was raked by automatic gunfire from a
passing car. Another American serviceman in the vehicle was wounded.
No group claimed responsibility. This attack occurred just before the
visit of President Bush to Panama.
The one "spectacular" international terrorist attack during the year
occurred on 17 March when a powerful truck bomb destroyed the Israeli
Embassy in Buenos Aires, Argentina. The blast leveled the embassy and
severely damaged a nearby church, school, and retirement home.
Twenty-nine persons were killed and 242 wounded. Islamic Jihad, a cover
name for the Iranian-sponsored group Hizballah, publicly claimed
responsibility for the attack and, to authenticate the claim, released a
videotape of the Israeli Embassy taken during surveillance before the
bombing. There is mounting evidence of Iranian Government
responsibility for this act of terrorism.
As was the case during the preceding three years, Latin America saw more
terrorism in 1992 than any other region. Antiforeign attacks in that
region were predominantly against American targets. Leftwing terrorism,
particularly in Europe, is in decline, but ethnic and separatist groups
in Europe, Latin America, South Asia, and the Middle East remained
active last year.
The deadly Peruvian terrorist group Sendero Luminoso was dealt a major
blow in September when security forces in Lima captured the group's
founder, Abimael Guzman, and many of its high command. Guzman was
subsequently sentenced to life imprisonment for his terrorist crimes.
None of the traditional state sponsors of terrorism has completely
abandoned the terrorist option, especially against dissidents, nor
severed ties to terrorist surrogates. Iraq's international terrorist
infrastructure was largely destroyed by the Coalition's counterterrorist
actions during that war. Since Operation Desert Storm, however, Saddam
has used terrorism to punish regime opponents and to intimidate UN and
private humanitarian workers. The Iranian regime has practiced state
terrorism since it took power in 1979; it is currently the deadliest
state sponsor and has achieved a worldwide reach.
There were fewer deaths caused by international terrorism during 1992,
93 vice 102 in 1991, but many more persons were wounded, 636 vice 242.
The single bombing of the Israeli Embassy in Argentina accounted for
about 40 percent of all those wounded in terrorist attacks in 1992.
State-Sponsored Terrorism Overview
The United States, its allies, and increasingly the UN Security Council
(UNSC) recognize the need to make those governments that support,
tolerate, and engage in international terrorism pay a significant price
for doing so. There was dramatic action by the UNSC in 1992 when it was
presented with clear evidence of Libya's responsibility for the bombings
of Pan Am Flight 103 and UTA Flight 77 and the resulting loss of 441
lives. In Resolution 731, the UNSC demanded that Libya end its
sponsorship of acts of international terrorism and cooperate with
American, British, and French judicial requirements in the trials of
those Libyan officials charged with the bombings. The Security Council
later voted mandatory sanctions against Libya when it determined that
Libya had not complied. The sanctions included an arms and air embargo,
a demand that Libyan Arab Airlines offices be closed, and a requirement
that all states reduce Libya's diplomatic presence abroad. The UNSC
reviews the Libyan case every 120 days. The UNSC's requirement that
Iraq refrain from sponsoring terrorism remains in effect as a part of
Resolution 687.
Despite these counterterrorism accomplishments, state sponsorship poses
an ongoing danger. Iran continued to be the most active of the state
sponsors. Iranian agents or surrogate groups conducted over 20 attacks
in 1992. Again this year, Iran's prime targets were Iranian opponents
of the regime and Israeli interests. Iran was the principal sponsor of
extremist Islamic and Palestinian groups. Besides providing funding,
training, and weapons to groups that conduct terrorist acts, Iran also
hosted a series of high-profile meetings with Hizballah and HAMAS that
had the stated goal of coordinating efforts against Israel and bringing
the Arab-Israeli peace process to a halt. Islamic Jihad, a cover name
for Hizballah, was responsible for the lethal car-bombing of the Israeli
Embassy in Argentina--an attack that killed 29 people and wounded 242.
Iraq, though constrained by UNSC sanctions and the expulsion of Iraqi
agents from many countries during the Gulf war, sponsored in the last
half of 1992 numerous attacks against Kurdish opponents and UN and
Western relief personnel and killed an Iraqi scientist in Jordan. Libya
and Syria continue to provide support and safehaven to a number of
Palestinian and non-Palestinian groups that engage in international
terrorism.
The United States currently lists Cuba, Iran, Iraq, Libya, North Korea,
and Syria as state sponsors of terrorism. This list is maintained
pursuant to Section 6 (j) of the Export Administration Act of 1979.
This and related US statutes impose trade and other restrictions on
countries determined by the Secretary of State to have repeatedly
provided support for acts of international terrorism. The list is sent
annually to Congress, although countries can be added or removed any
time during the year as circumstances warrant. (###)
ARTICLE 10:
Statements at Confirmation Hearings
Douglas J. Bennet
Assistant Secretary-designate For International Organization Affairs
Statement before the Senate Foreign Relations Committee, Washington, DC,
May 7, 1993.
Mr. Chairman and members of the committee, it falls to this nation, this
Administration, and this committee, in this decade, to help the world
define its expectations for a new era. International institutions that
really work will be essential, and part of America's global leadership
role is to see that they do.
So it is a great honor to be nominated by President Clinton to serve as
Assistant Secretary of State for International Organization Affairs. It
is a pleasure to appear again before this committee. Those who recall
my previous stints as Assistant Secretary for Congressional Relations
and as Administrator of AID know that I am committed to close and open
consultations with Congress and to bipartisan- ship. These are all the
more important in today's unfamiliar circumstances.
The United Nations and many of its agencies were created in the
aftermath of a global war. Their charters are noble constitutions,
established by people who knew the cost of chaos among nations and
realized that it arose from poverty, oppression, arms proliferation, and
forces of history that could rage out of control. Our country had a lot
to do with those charters. They were written at another time of American
leadership in the world, when we took the opportunity, together with
others, to define global hopes in terms consistent with American
standards of freedom and human dignity.
It would be hard to create a UN system today if we were starting from
scratch. Fortunately, we already have a set of global institutions
inspired by our values. We now have a fresh chance to help restore
their effectiveness. During 41/2 decades, they have done some useful
experimentation and achieved some important successes. These
institutions are not free-standing, however. They do as well or as
poorly as they are used by their member nations. The agencies often
have been compromised by veiled patronage interests of donors and
beneficiaries alike. Lack of consensus objectives has meant lack of
accountability; lack of accountability has meant lack of credibility;
lack of credibility has made it all the easier for member states to
ignore or disparage these important global institutions.
Now we are in the process of revalidating the hopes of the original
chapters and remaking the institutions. President Bush ultimately saw
the UN as a building block for the new world order. In one of his first
actions, President Clinton announced that his Ambassador to the United
Nations would be a member of his Cabinet and of the National Security
Council. The bipartisan decision to pay our assessments and arrearages
was a result of significant strides the UN has made with regard to
budget reform and of recognition of the growing role the UN is being
asked to play, particularly in peace-keeping. This decision reflected
an understanding that not meeting our financial obligations has caused
the US to lose influence with both the international community and the
UN Secretariat.
With US support, meanwhile, progress is being made in redefining and
reworking the UN system for the post-Cold War era. The United States
has welcomed the constructive leadership put forward by Secretary
General Boutros-Ghali in his reform efforts, including his "Agenda for
Peace." We will work with him and the other members of the United
Nations to make UN peace-keeping more effective and to ensure that the
UN system is capable of handling other important items on the global
agenda. Let me outline some of the broad directions this Administration
will be pursuing.
Strengthening the Security Council
Nothing is more critical to the long- term prospects for peace than
assuring the effectiveness of the Security Council as the supreme global
authority for peace-making, peace-keeping, and peace enforcement,
including their humanitarian dimensions. The United States must work
with the other members of the Council and the world community, in
general, to ensure the effectiveness of Council decisions on these
matters.
During his campaign, President Clinton opened the question of expanding
membership to ensure that the Security Council represents today's
international realities. As we review ways to reach this objective, we
will give highest priority to ensuring that the Security Council can
operate effectively. The Security Council now is swamped with peace-
keeping business. It is meeting almost round- the-clock. Its policy,
planning, and intelligence support is inadequate. What the Security
Council decides, the Secretary General and the world community must be
prepared to undertake. Today, the world continues to experiment
urgently to find effective ways to keep the peace through multilateral
action. We are testing combinations of diplomacy, emergency relief
assistance, electoral monitoring, economic sanctions, and armed
intervention. We are saving lives, and we are losing lives, because our
tools and responses in this new era are still grossly inadequate. It is
not clear whether these instruments can work in Bosnia, but what is now
absolutely clear is that America has an unavoidable leadership role in
multilateral efforts for peace.
This Administration is preparing a plan for the long-term strengthening
of UN peace-keeping and US capacity to participate. We are building on
the series of efforts starting with the statement by heads of state and
government at the meeting in January 1992 of the UN Security Council.
They called upon the Secretary General to recommend ways to strengthen
and make more efficient the UN's capacity for preventive diplomacy,
peace-making, and peace-keeping. Last summer, Secretary General
Boutros-Ghali responded with his "Agenda for Peace." That document and
subsequent proposals made by the previous Administration last September
at the UN General Assembly are the basis for [our] own review.
Beginning in February, a number of US foreign affairs agencies have
looked at US participation in operations involving not only peace-
keeping but also humanitarian relief, observer groups, and enforcement
of UN man- dates. Some of the topics reviewed have been the overall
role of peacekeeping, the role of regional organizations, the
administrative and operational capabilities of the UN, financing,
Article 43 and command relationships, how the US military is organized
for these activities, the executive-legislative relationship, and
legislation which may require amendment.
To assist the UN, we have looked specifically at helping the Secretary
General establish a planning cell and a 24-hour operations center to
prepare for and then stay on top of peace-keeping missions;
standardizing training and developing joint exercises, as well as peace-
keeping doctrine and rules of engagement; adopting financial and
managerial reforms; and identifying force capabilities which could be
made available to the UN on short notice. We hope to achieve these
reforms in concert with other members of the Security Council and with
the support of the General Assembly. Our objective in all of this is to
strengthen the system of international security which the founders of
the UN had intended, and which had been hampered for over 40 years by
the influence of the Cold War in the Security Council.
Good Governance and Good Management of UN Agencies
Just as the Security Council struggles to meet the demands of a new era
in peace-keeping, so must the rest of the UN make real progress
elsewhere on the global agenda. Secretary General Boutros-Ghali is
committed to reform. He has launched a major effort--long encouraged by
the United States--to rationalize the activities of the Secretariat and
eliminate duplication and overlap in UN programs and activities. We have
been supportive of the Secretary General's objectives.
Together [with] the leaders of the institutions themselves and with
donors and beneficiaries alike, the Bureau of International Organization
Affairs will prepare a plan to enhance the performance of the most
important of these institutions. Reform plans need to be tailor-made,
but there are some basic principles that apply across the board.
-- Clarify objectives.
-- Establish accountability. Be sure leaders can lead, managers can
manage, and governing bodies take responsibility for the success of the
institutions.
-- Evaluate results.
-- Work for transparency.
We need to ensure that the UN's economic and social capacities improve
in tandem with the expansion of the UN's peace-keeping efforts and that
the urgency of peace-keeping does not distract us from other important
global issues. Unless the UN is effective across the board, it may
prove difficult to maintain an international consensus that the UN
operate as an effective guardian of the interest of the world community
in places like Somalia and Bosnia.
In one recent reform, the major development agencies and programs were
brought directly under the Economic and Social Council umbrella, with
ECOSOC now providing system-wide policy guidance, implementation
coordination, and better governance through open, high-level oversight.
In the United Nations Conference on Trade and Development, developing
countries have begun to examine economic issues with new realism based
on market-oriented policies. The old confrontations over increased aid,
debt-forgiveness, and a changed world order have given way to a
constructive agenda of national policy reforms to liberalize trade, to
attract investment, and to support private-sector development. The US
has worked for many years to help bring about this shift and to support
constructive economic dialogue in the UN, generally. Our goal has been
"an OECD for developing countries" and to set a model for reform
elsewhere in the UN system.
With the growing role of the United Nations in meeting a global agenda,
there very likely will be increased need for funds to finance UN
operations. The United States, in its own interest, will want to
contribute. This, in turn, increases the requirement for assurance that
UN funds be spent effectively. Last week in Geneva at a meeting of
major donor members, the United States put forward our proposal for a UN
inspector general or another comparable mechanism. The concluding
statement of the meeting underlined the importance of achieving the
highest standards of accountability and transparency throughout the UN
system, and welcomed the US offer to produce a paper on establishing an
office of inspector general for review by the group.
Fair and Adequate Assessments
Secretary General Boutros-Ghali requested last autumn that the Ford
Foundation sponsor an independent advisory group on UN financing--the
Volcker-Ogata group whose report was recently released. The
introduction to the report reads, "the examination of UN financing is
important precisely because it is part of a broader debate--a debate
about how to build a lawful and just world order while the opportunity
to do so still exists. Only with foresight, and a willingness on the
part of governments to face up to their responsibilities and
commitments, can the UN become the organization that our times demand."
Last week, representatives of the major funding nations discussed the
Volcker-Ogata report at their Geneva meeting. The members of the Geneva
Group agreed that this report "was an impressive and perceptive document
which helped clarify the UN's current financial problems and could help
advance discussion of possible solutions." While not all
recommendations were equally attractive, the group members broadly
supported the overall thrust of the report. We will encourage and
monitor appropriate follow-up.
The Clinton Administration is committed to meeting its financial
obligations to the UN and other international organizations and to
helping to restore their financial stability. This commitment is
especially important in regard to the greatly increased peace-keeping
expenses of the UN. In undertaking this commitment, we share with
Members of Congress concern about the disproportionate share of UN
peace-keeping assessments borne by the United States. The present
special peace-keeping scale reflects a 20-year-old agreement among
member nations to meet a special situation in the Middle East. The
capacities of many of these nations, and surely the circumstances, have
changed over two decades. Today, all nations are supposed to pay
something toward peace-keeping, but our belief is that the US shares
should be the same as for regular UN assessments. Precisely, because we
know we have to expect higher peace-keeping expenses in the future, it
becomes all the more important now that the burden be equitably shared
so that commitments are willingly met.
Sustained Participation
Mr. Chairman, I said the world's nations were experimenting urgently
with peace-keeping through the UN. We are experimenting in other areas
as well--for example, putting the concepts of sustainable development
into practice. The United States will participate as a full partner.
It is no longer in our interest to operate at arms length as we have
done sometimes in the past, turning to the UN when we needed it and
turning away when we did not.
We need to listen carefully to voices from other nations. In forums
like the Security Council, the Economic and Social Council, and the
General Assembly--and this comes as no surprise in a nation accustomed
to democratic legislatures--we must work with other nations and other
views toward durable consensus. When it comes to governance of the
agencies, some of which have been politicized to a point where they
cannot be effective, we and other nations need to start operating in the
collective interest rather than political self-interest.
As Secretary Christopher testified, this Administration intends to
"organize our foreign policy around the goal of promoting the spread of
democracy and markets abroad." These objectives imply global
engagement. They require global systems and institutions that are
reliable and credible.
These issues are not for diplomats and generals only. Publics
everywhere are witness to the events in Bosnia and Somalia. In the
agony of the former Yugoslavia we are testing not the UN, but the
capacity of the world community, through the UN, to stop brutality,
which is by no means unique to the Balkans. It is morally indefensible
that hundreds of thousands of people should die each year from
starvation and genocide. It is just as untenable when relief workers
die for lack of protection or peace-keepers die for lack of a credible
mandate or adequate support. My guess is that it will become politically
unsustainable if these atrocities occur for long on international TV
without a proportionate response.
Ultimately, it is the public in democracies around the world who must
decide to support interventions, to risk their own sons and daughters,
to save the lives of others, and to make an adequate financial
investment in global peace. Our leadership obligation, as I see it, is
to create credible instruments that deserve their support.
I view it as my task not just to respond to events, although that we
must, but work with the committee in building an agenda for making these
international institutions into powerful assets. With an agenda, the
United States may be able to shape to events in ways that build an
acceptable structure for the new world order; without an agenda
opportunities may be lost irretrievably. Declaring for change and
helping it happen, the US can help revitalize instruments for peace,
human rights, and development whose potential is even greater now than
in the past.
Elinor G. Constable
Assistant Secretary-designate For Oceans and International Environmental
and Scientific Affairs
Statement before the Senate Foreign Relations Committee, Washington, DC,
May 7, 1993.
Mr. Chairman, it is a privilege to testify before you today as the
President's nominee for the post of Assistant Secretary for the Bureau
of Oceans and International Environmental and Scientific Affairs (OES).
Given your critical role in this bureau's creation some two decades ago,
it is particularly appropriate that I appear before you at this time.
The OES bureau's mandate has never been more crucial or more
challenging. As the United States moves into the post-Cold War era,
issues such as climate change, biodiversity, ocean policy, and science
and technology cooperation will become increasingly important elements
of US foreign policy.
I have been personally concerned about many of these issues for years
and am honored that the President has asked me to advance the
Administration's agenda in these areas of great significance for this
country and for the world.
Should I be confirmed, I will do my best to address the broad range of
international environmental concerns the United States faces and to
build on the progress made at last year's earth summit in Rio. The
earth summit goal of a truly sustainable future can be achieved if we
pursue sound policies that promote both environmental objectives and
economic growth. To reach this goal, we will engage in an enhanced
global dialogue to deal with climate change, depletion of the ozone
layer, destruction of forests, and other pressing concerns.
Our environmental goals encompass many significant oceans issues. We
hope to make progress in dealing with marine pollution, protecting
marine mammals and other species, and conserving fish stocks of
importance to the US industry. We will also take a more active role in
international discussions on the Law of the Sea Convention, a topic I
know is of deep and abiding interest to you, Mr. Chairman.
Bilateral and multilateral cooperation on science and technology
programs is essential for developing new technologies to benefit
mankind, such as those in the area of energy and the environment.
Access to scientific developments in other countries also can help
ensure that the United States remains the world's scientific and
technological leader. This is vital for our nation's long-term economic
competitiveness.
In summary, Mr. Chairman, the OES Bureau and the State Department face
tremendous challenges in the years ahead. I am very pleased about this
opportunity to advance an agenda that I care about deeply. I look
forward to working closely and often with this committee on these very
important issues.
John Shattuck
Assistant Secretary-designate for Human Rights and Humanitarian Affairs
Statement before the Senate Foreign Relations Committee, Washington, DC,
May 7, 1993.
Mr. Chairman, members of the committee, it is a