US DEPARTMENT OF STATE DISPATCH
VOLUME 4, NUMBER 52, DECEMBER 27, 1993
PUBLISHED BY THE BUREAU OF PUBLIC AFFAIRS

ARTICLES IN THIS ISSUE:
1.  The U.S. and Japan:  Working Together To Meet Economic Challenges -- 
Walter F. Mondale
2.  The United States and Romania:  Investing in Peace and Prosperity -- 
Secretary Christopher, Romanian Foreign Minister Melescanu
3.  Fact Sheet:  U.S.-Romanian Bilateral Investment Treaty
4.  Meeting of the Friends of Haiti
5.  Gabon Presidential Elections



ARTICLE 1:

The U.S. and Japan:  Working Together To Meet Economic Challenges
Walter F. Mondale, U.S. Ambassador to Japan
Address to the Keidanren Committee on U.S. Affairs, Tokyo, Japan, 
December 16, 1993

Thank you for inviting me to speak here this morning.  I wish to thank 
Mr. Makihara for his kind introduction--and for his very able leadership 
of this important committee.

I also wish to express my sympathy and best wishes for one of Japan's 
foremost business leaders, Akio Morita.  He is a friend of mine, and I 
know that I join with many others in wishing him a speedy recovery.  He 
is a much-needed source of wisdom during this critical period in Japan's 
economic   transition.

Since arriving, I have been very  impressed by the quality and talent of 
Japan's business leadership.  At the same time, I realize that many 
companies are now hurting as a result of the lingering recession and the 
restructuring that is taking place in the Japanese economy.

I sense a growing recognition in  the business community that many of 
Japan's traditional economic policies and business practices must be 
altered to reflect Japan's changing place in the world and its new 
international responsibilities.  I also find that business leaders here 
remain very positive about the need for strong ties between Japan and 
the United States.

As members of this committee, of course, you have a special interest and 
concern for the success of the U.S.-Japan relationship in all its 
dimensions.  This relationship is certainly one of the most remarkable 
international success stories of the past half century.  We are allies, 
partners, and friends.  Our destinies are now inseparable.  We are 
working together in a number of  areas. 

In the security area, the partnership between the United States and 
Japan could not be any better.  Our alliance is the foundation of 
stability here and throughout the region.  We remain fully committed to 
our security arrangements here; every country in the region--except 
North Korea--has told us that they want us to be here.  While we are 
reducing our force levels elsewhere in the world, we have made it clear 
that our presence in Japan will remain strong.  As a result, we will 
soon have as many forces in Asia as in Europe--a dramatic shift from 
only a few years ago.

On the political front, our two countries are working very well together 
in the United Nations and other multilateral institutions--including the 
G-7, World Bank, and OECD.  We are also cooperating on a full range of 
what are called "global issues"--environmental protection, health, AIDS, 
population issues, science, and aid to developing countries. 

 The United States and Japan are effective partners at the regional 
level.  We worked together to make last month's historic APEC meeting a 
success.  The combined leadership of the United States and Japan will be 
crucial to ensuring the continued prosperity and stability of the Asia-
Pacific region.

Likewise, last month's congressional vote on the North American Free 
Trade Agreement (NAFTA)--which reaffirmed America's commitment to free 
trade and open markets--will help reduce trade barriers and produce new 
economic opportunities, not just in North America, but worldwide.  We 
appreciated Japan's support in this effort.

 The difficulties in our relationship come, of course, in the area of 
trade and economics.  Because we are the world's two largest economies 
and because of our deep interdependence, some tensions are inevitable 
between us.  But we cannot be complacent about them.

Japan's huge external surpluses are one of the principal asymmetries in 
the world economy today.  The collapse of your "bubble economy" and the 
protracted recession have worsened your trade imbalances, not just with 
the United States, but with almost every one of your trading partners.  
These imbalances reflect a number of complex factors, but they also show 
that your economic structure is not as open to  imports and foreign 
investment as the other major economies of the world. 

At last July's G-7 summit, Japan pledged to implement fiscal and 
monetary measures as necessary to ensure sustained noninflationary 
growth led by strong domestic demand.  This      reflected a consensus 
among the G-7 nations that robust growth in the world economy depends on 
a sustained expansion of domestic consumer demand in Japan.  Without 
this, Japan's huge     external surpluses will continue to accumulate--
draining demand from an already weak world economy and fueling 
protectionist pressures.

We also face a number of serious sectoral and structural issues.  We 
have begun to address these problems, and I believe a note of hope is in 
order.

First of all, we have finally brought the Uruguay Round of the GATT to a 
successful conclusion.  This is very good news, and it would not have 
happened without the cooperation and leadership of both Japan and the 
United States.  The stakes were as high as they get, and the world is 
grateful to Japan for taking this historic step to open its rice market.  
By conservative estimates, the success of the Uruguay Round will mean a 
net gain in annual world income of at least $200 billion by the end of 
the decade.  Japan will be one of the biggest winners.

A second positive step in the economic area is the joint Framework for a 
New Economic Partnership, which was signed last July by President 
Clinton and then-Prime Minister Miyazawa.  Prime Minister Hosokawa's 
government has reaffirmed its commitment to this framework agreement.

As you know, on February 11, the President and the Prime Minister will 
meet in Washington to review progress on the negotiations.  It will be 
the first meeting called for under the framework agreement.  Both of our 
governments understand that it must be a productive and successful 
meeting.

At the heart of the framework is a bargain.  The United States has 
agreed to "reduce its fiscal deficit, to promote domestic saving, and to 
strengthen its international competitiveness"--and we have promised to 
keep American markets open.  For its part, Japan has agreed to pursue 
policies in the medium term that would lead to a "highly significant" 
reduction in its global    current account surplus and to a 
"significant" increase in its global imports of goods and services.  The 
United States and Japan have also pledged to work together "to promote 
global growth, open markets, and a vital world trading system." 

On sectoral issues, we have agreed that "tangible progress" must be 
achieved on the objectives laid out in the framework.  We are conducting 
negotiations in five areas or "baskets."  We have agreed to assess the 
progress achieved in each of these baskets by  using "objective 
criteria, either quantitative or qualitative or both as appropriate."

The framework does not call for single-number "targets" for market 
share, nor is the United States asking for them.  The framework also 
does not seek to "manage" trade; instead, it seeks to "unmanage" and 
expand trade by removing market barriers.

The framework agreement is best understood in the broader context of 
U.S.-Japan relations and the global economy.  As the two largest 
economies in the world, the United States and Japan must have a shared 
vision of our economic objectives--and with this shared vision come 
shared responsibilities.

 The rationale behind the framework is an understanding that the world's 
major industrial economies--the United States, Europe, and Japan--should 
be equivalent in terms of their overall openness to imports   and 
investment.  It does not mean that we will be identical in every 
respect.  But it does mean that our fundamental economic patterns should 
be similar.

By helping to open markets and boost domestic demand, successful 
implementation of the framework will strengthen Japan's economy and 
create new opportunities for both Japanese and foreign companies.  But, 
even more, it will create new opportunities for Japanese consumers and 
help bring the living standards of the Japanese people more in line with 
Japan's wealth as a nation.

In his inaugural policy speech to the Diet, Prime Minister Hosokawa 
stated his intention . . . to work vigorously for expanded domestic 
demand and improved market access and for such consumer-oriented 
policies as rectifying the disparity between domestic and international 
prices and promoting deregulation, and to strive to reduce our current 
account surplus, not just to maintain good economic relations, but also 
to improve the quality of Japanese life. 

I am impressed by the many voices, especially in the business community, 
who join with the Prime Minister in calling for Japan to deregulate, 
open its markets, increase consumer choice, stimulate domestic demand, 
and reduce the current account surplus. 

As you may recall, each of these goals was also among the key 
recommendations of the two Maekawa reports.  Likewise, many people have 
been looking forward to the Economic Reform Research Council's final 
report on deregulation, which is being released today.

Japan, of course, must make its own decisions about what economic 
policies it wants.  But these choices inevitably will have international 
implications.

With its decision to accept rice liberalization under the GATT, for 
example, Japan has earned the respect and gratitude of the world, and I 
believe Japanese consumers will ultimately enjoy the benefits.  With   
the framework agreement, Japan has signaled that it wants to move toward 
the kind of broad economic openness that characterizes the other major 
industrial nations.

I did not come to your country to tell your government, your people, or 
your businesses what to do.  That is not my role, and I will not cross 
that line.  We do have a special relationship, however.  As friends, we 
have a responsibility to be straightforward and candid with each other.  
While friends do not try to run each other's affairs, they also do not 
keep silent when useful advice can be offered in the spirit of 
friendship.

During the 1980s, at every G-7 meeting Japan and the other members told 
the United States--pleaded with us--that we had to get our budget 
deficits under control.  At that time, these deficits were the major 
asymmetry in the world economy.  They were getting worse every year, and 
we were not doing anything about it.  Our friends in Japan and elsewhere 
told us that this could not be sustained and that we needed to shape up-
-for our own good and for the good of the world economy.

You were right.  Now the United States is finally attacking these 
deficits.  It was very difficult, and there will be more difficult 
decisions down the road.  But at least now we are headed in the right 
direction.  It was important that Japan and the other G-7 members kept 
reminding us of the urgency of correcting our deficits.  This is an 
example of the proper advice that friends owe to each other. 

I hope that my own comments this morning--and in the future--will be  
accepted in this same spirit.  The relationship between the United 
States and Japan must always be based on dignity and respect.  We cannot 
allow our economic problems to produce the frustration and mistrust that 
would poison this most important relationship.  We have too much at 
stake to permit this to happen.

We should instead be focused on working together as partners to find 
common ground, resolve our problems, and enhance our cooperation.  I 
know this is a time of difficult decisions for your country.  As 
experienced business leaders, you have the knowledge, judgment, and 
leadership to help guide Japan into the future.

If the United States and Japan can work through our economic 
differences--and we must--then our two great nations will be able to 
concentrate on using our enormous power and influence to make a 
difference in addressing the many other problems in the world today.

The recent elections in Russia remind us of how precious our own 
partnership is.  There, we see how an outrageous demagogue, Vladimir 
Zhirinovskiy, can prey on the vulnerability, suffering, and desperation 
of the Russian people.  He is a merchant of hate, but his party got the 
votes. When we see what has happened in Russia, we realize that the 
United States and Japan have so much going for us.  We are prosperous 
economies, we are stable democratic societies, and we are committed to 
working together.

It is in this spirit that I hope we will approach our economic 
challenges in the coming months.  I look forward to working with all of 
you toward this end.  (###)



ARTICLE 2:

The United States and Romania:  Investing in Peace and Prosperity
Secretary Christopher, Romanian Foreign Minister Melescanu
Remarks following the exchange of instruments of ratification of the 
U.S.-Romanian Bilateral Investment Treaty, Washington, DC, December 16, 
1993

Secretary Christopher.  Good morning.  I'm very happy to welcome Foreign 
Minister Melescanu here to Washington.  This is the first visit of a 
Romanian Foreign Minister since the 1989 revolution.  We are strong 
supporters of the political process--the process of economic reform in 
Romania, and we think it's exceedingly important that that process 
continue.  I look forward to talking with the Minister about that.

This morning is a good opportunity for me to announce that we will be 
creating an Enterprise Fund for Romania, funded at some $50 million to 
provide investment capital for private sector development in Romania.  
As you've just seen, the Minister's visit gives us an opportunity to 
exchange instruments of ratification for the Bilateral Investment 
Treaty.  Along with MFN status, this is a major step forward for United 
States and Romanian business.

In our discussions today, I'm sure we'll be stressing the importance of 
rigorous human rights standards and observance as mandated by CSCE and 
Council of Europe membership.  I think we're going to have an 
opportunity to discuss the effects of extreme nationalism and 
intolerance and the way they can serve to weaken democratic institutions 
and, therefore, should be condemned very firmly.

The Foreign Minister has played an important role in making Romania a 
responsible partner in this region, in bringing that country closer to 
the European Union, as well as in the prospects of the Partnership for 
Peace.  We'll be working closely together and discussing here today that 
initiative that the United States will be putting forward, the 
Partnership for Peace.  Of course, those discussions will continue 
between us and our NATO partners in January.

So, I look forward to good discussions with you, Mr. Minister, and I'm 
very pleased that you're here in Washington.

Foreign Minister Melescanu.  Thank you very much.  Mr. Secretary, ladies 
and gentlemen:  It is really an honor and rewarding experience to be 
here with you in Washington.  The opportunity to come here, I think, is 
indicative of the consistent support extended by the Administration for 
the political and economic change currently underway in Romania.  We 
fully appreciate that.

The granting of MFN status; the exchange of the instruments of 
ratification of the Bilateral Investment Treaty; and the Enterprise Fund 
for Romania, which was announced today, seem to be very good omens for 
our bilateral relations--in particular, for the Romanian and U.S. 
businessman.  We are ready to make cooperation with the United States 
the cornerstone of our foreign policy.  This is why we welcome the 
Partnership for Peace as a sign of a closer relation with NATO and the 
European Union.  It will enhance, we are convinced, both our security 
and the security of the European region.

I would also like to stress the importance we are attaching to the 
implementation of human rights standards, mandated by the CSCE and by 
the Council of Europe.  The recurrence of extreme nationalism and 
intolerance are dangerous wherever that happens.  The President of 
Romania and our government will do their utmost to prevent it.  We 
count, at the same time, on the support and understanding of our friends 
in the United States.  Thank you very much. (###)



ARTICLE 3:

Fact Sheet:  U.S.-Romanian Bilateral Investment Treaty

The United States and Romania exchanged instruments of ratification for 
the Treaty Concerning the Reciprocal Encouragement and Protection of 
Investment, commonly known as a Bilateral Investment Treaty (BIT), in 
Washington, DC, on December 16, 1993.  The U.S. Senate gave its advice 
and consent to ratification on November 17, and President Bill Clinton 
ratified the treaty on December 15, 1993; the Romanian Parliament 
ratified the treaty on November 11, 1993.  The treaty, signed on May 28, 
1992, by Deputy Secretary of State Lawrence Eagleburger for the U.S. and 
Minister for Foreign Affairs Adrian Nastase for Romania, will enter into 
force 30 days after the exchange of instruments of ratification.  

This treaty reflects a wider U.S. interest in signing BITs with the 
countries of Eastern Europe and the former Soviet Union.  Since 1982, 
the United States has signed 25 BITs, 13 of which already are in force.

BITs promote stable, market-oriented policies toward foreign investment.  
As with other BITs negotiated by the United States, this BIT provides 
for:

--  Nondiscriminatory treatment of foreign investment both on and after 
establishment, subject to certain specified exceptions;

--  Free transfers of capital and returns on investment;

--  Expropriation only within international legal standards, which 
require prompt, adequate, and effective compensation;

--  Fair procedures, including access to international arbitration, for 
resolving disputes between investors and governments; and

--  Protections against performance requirements, including obligations 
to purchase local products or services or to export local goods.

This treaty is part of a concerted effort by the United States to expand 
economic relations with Romania.  In November 1993, the United States 
renewed Romania's most-favored-nation trade status.  The BIT agreement 
will assist Romania in its transition to a free market economy by 
helping to create favorable conditions for U.S. private investment and 
to strengthen the development of the private sector in Romania.  (###)


ARTICLE 4:

Meeting of the Friends of Haiti
Following is the text of the Statement of Conclusions of the Meeting of 
the Friends of Haiti, released in Paris, France, December 14, 1993.

Representatives of the Friends of the United Nations Secretary General 
on the question of Haiti (Canada, France, United States, Venezuela) met 
in Paris on the 13th and 14th of December in the presence of the special 
representative of the United Nations Secretary General, Mr. Dante 
Caputo, in order to examine the situation in Haiti and confer on how to 
ensure the return to constitutional legality in that country.

On this occasion, they heard the Prime Minister of Haiti, Mr. Malval, 
explain his proposals of the 6th of December for a national conference 
and give his views on the evolution of his country.  They expressed 
their gratitude to him for having contributed to the success of their 
work and welcomed strongly the fact that Mr. Malval will remain acting 
Prime Minister until his successor has been appointed in accordance with 
the Haitian Constitution.

They agreed on the following:

1.  The process as defined by the Governors Island Agreement which 
provides for the return of President Aristide constitutes the only 
viable framework for Haiti to emerge from the crisis and to lead to the 
establishment of a state under the rule of law guaranteeing freedom, 
security and human rights for all.

2.  It is the task of the Haitian parties to work out the procedures and 
political arrangements required to bring about compliance by both sides 
with their obligations under the Governors Island Agreement and the 
broader objective of national reconciliation it envisions.  The Friends 
are committed to facilitate this essential task.  Mr. Malval's ideas 
about a national conference offer a practical way to address this issue.

3.  The Friends remind both signatories of their obligation under the 
Governors Island Agreement to implement their commitments related to 
points 5c to 9 of this accord.  In accordance with the relevant 
resolutions of the UN Security Council, they consider that the sanctions 
should be suspended only when the military authorities in Haiti have:

--  Created the proper environment for the deployment of the United 
Nations police and military cooperation mission.

--  Created the proper environment in which legislative actions called 
for in the Governors Island Agreement can be taken.

--  Facilitated the changes in the leadership of the police and military 
called for in the Governors Island Agreement.

--  Created the proper environment for the return of the democratically 
elected President and maintenance of constitutional order.

The Friends recognize that the successful completion of some of the 
steps provided for in the Governors Island Agreement requires the active 
cooperation of parties other than the Haitian military authorities.  The 
sanctions adopted by the Security Council are based solely on the 
failure of the Haitian military authorities thus far to fulfill their 
commitments.  Accordingly, should the Haitian military in good faith 
take all necessary action within its capacities to bring about the 
fulfillment of the Governors Island Agreement, as outlined above, the 
sanctions should be suspended regardless of the actions of other 
parties.  However, should the Haitian military fail to act in good faith 
to fulfill its obligations, the sanctions should be maintained 
regardless of the compliance of the other parties.

4.  If the military fails to comply with its obligations, the Security 
Council should meet to consider additional measures including making the 
embargo already applied by the OAS universal and mandatory, applying 
further sanctions against the main supporters of the military 
authorities or banning non-commercial flights into and out of Haiti.  
They welcome additional national measures to support this objective.

5.  A high level mission from the Friends including military officers 
shall travel to Haiti to transmit this message of resolute determination 
to the Haitian military authorities.

6.  The Friends are determined to ensure the full respect of the present 
sanctions arrangements.  They welcome the continuation of the 
international cooperation for naval enforcement of the present measures 
and note the special situation of the Dominican Republic; they offer 
their availability to assist this country to ensure that the sanctions 
are fully respected.

7.  The Friends have decided to intensify their cooperation to deter the 
use of the Haitian territory by international drug traffickers.

8.  Aware of the suffering of the Haitian people caused by the continued 
intransigence of the military, the Friends are committed to continue to 
provide and intensify their humanitarian aid to people in need and urge 
the international community to join their efforts.

9.  They call for the redeployment of the MICIVIH as soon as conditions 
permit.

10.  The Friends call for the establishment by the UN of an active 
communication campaign which would include study for the establishment 
of a radio station directed at promoting democracy in Haiti.

11.  The Friends thank the UN Secretary General, the OAS Secretary 
General and their special envoy, Mr. Dante Caputo, for their untiring 
efforts and reaffirm their full support to them.

12.  The Friends will inform President Aristide of their positions.

13.  The Friends shall meet as required, at ministerial level if 
necessary.  (###)



ARTICLE 5:

Gabon Presidential Elections
Statement by Acting Department Spokesman Christine Shelly, Washington, 
DC, December 20, 1993.

The United States applauds the people of Gabon for participating in 
overwhelming numbers in Gabon's first multi-party presidential elections 
on December 5.  Numerous reports of administrative confusion before and 
during the election, however, have been noted.

We are not in a position to determine if these administrative problems 
affected the outcome of the election.  International observer 
delegations-- including the African-American Institute (AAI), the 
Organization of African Unity (OAU), the African National Congress 
(ANC), and the International Commission of Jurists (ICJ)--in an interim, 
joint statement issued December 6, noted a series of administrative and 
technical imperfections which affected the conduct of the polls, 
particularly in Gabon's capital of Libreville.  They termed the absence 
of electoral lists in many polling stations as the most serious problem.  
Subsequent statements by some observers, again, note serious 
organizational flaws but do not challenge the validity of the election.

Assistant Secretary of State for African Affairs George Moose met with 
President Bongo's Minister of Petroleum and personal emissary, Jean 
Ping, on November 10.  Mr. Moose reiterated the U.S. commitment to 
Gabon's democratic transition and expressed concerns regarding what  the 
Government of Gabon and opposition leaders admitted were problems with 
election preparations.  At that time, Minister Ping was asked to convey 
to President Bongo our hope that the election process would be judged as 
credible and transparent by all the citizens of Gabon.

We are disappointed that the Government of Gabon did not do more to 
resolve the problems with electoral preparations before the election 
took place.  Nevertheless, we urge the people of Gabon to continue to 
respect the constitutional process they themselves have established.  
That process has declared President Omar Bongo the winner.  We note that 
some Gabonese leaders have declared their intention to challenge the 
election results before the constitutional court.  The U.S. hopes that 
this process will continue peacefully, in accordance with Gabon's 
constitution, and that the Government of Gabon will respect the human 
rights of all its citizens.

We applaud the dedication of the people of Gabon to the democratic path 
they have chosen.  The U.S. intends to continue to support this 
important process.  (###)

[END OF DISPATCH VOL. 4 NO. 52]

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