U.S. DEPARTMENT OF STATE DISPATCH
VOLUME 5, NUMBER 18, MAY 2, 1994
PUBLISHED BY THE BUREAU OF PUBLIC AFFAIRS
 
ARTICLES IN THIS ISSUE:
 
1.  American Engagement in a Changing World:  A Vital
Commitment -- President Clinton
2.  Statements by President Clinton
--  South Africa Congratulated on Start of Elections
--  Situation in Rwanda
--  Latvia and Russia Agree on Withdrawal of Military Forces
--  International Fishery Conservation
3.  U.S. Economic Policy and the Asia-Pacific Region:  The
Search for Balance -- Joan E. Spero
4.  Fact Sheet:  Armenia
5.  Fact Sheet:  Azerbaijan
6.  Fact Sheet:  Belarus
7.  Fact Sheet:  Moldova
8.  Fact Sheet:  Ukraine
 
 
 
 
ARTICLE 1:
 
American Engagement in a Changing World:  A Vital Commitment
President Clinton
Radio address to the nation, Washington, DC, April 30, 1994
 
This week, all of us watched with wonder as South Africa was
reborn.  Young men carried their elderly fathers on their
backs to the polling booths; black voters came on crutches
and in wheelchairs, traveling for miles and waiting for
hours in this great march to freedom.
 
The miracle of South Africa's rebirth as a non-racial
democracy is an inspiring testament to the courage and
vision of its citizens.  And I'm proud of America's role in
helping them make the miracle happen.
 
Private citizens, religious leaders, and Members of Congress
worked for years to rally public opinion and impose economic
sanctions against South Africa.  When Nelson Mandela and
F.W. de Klerk reached their agreement to dismantle
apartheid, we were one of the first countries to lift
sanctions so we could help fuel the recovery of a new South
Africa.
 
Just in the last year, we have supported unprecedented
voter-education and election-monitor training programs.  And
this week, I'll be announcing a substantial increase in our
aid to South Africa to help it navigate a new course for all
of its people.
 
This morning, I want to talk about why this kind of vigorous
American engagement and leadership remains vital not only in
South Africa but around the globe.  Consider the former
Yugoslavia, where American engagement today is essential.
The breakup of that country, inflamed by Serb aggression,
has resulted in three years of bloodshed and ethnic
cleansing in Bosnia and elsewhere.
 
We have clear interests at stake in helping to bring a
peaceful end to the Bosnian conflict; an interest in
preventing a wider war in Europe; an interest in preventing
a flood of refugees; an interest in maintaining the
credibility and effectiveness of NATO as a force for peace
in the new, post-Cold War era--and, clearly, an interest in
helping to stop the slaughter of innocent civilians.  That
is why we've been working to spur negotiations among the
warring parties.  And it is why we've harnessed NATO's power
in the service of diplomacy.
 
In February, at the initiative of the.United States, NATO
issued an ultimatum to Bosnian Serbs against the further
shelling of the Bosnian capital of Sarajevo.  Today,
Sarajevo is relatively quiet.  Its citizens are emerging
from the rubble to begin rebuilding their lives.
 
Just last week, we and our NATO allies extended a similar
ultimatum for the besieged town of Gorazde and five other
Muslim-majority towns the UN has designated as safe areas.
After weeks of relentless shelling, the Serbs have backed
off and withdrawn their guns from around Gorazde.  While new
challenges lie ahead in Bosnia, our determination to take
action along with our NATO allies in support of the UN
mission there clearly generated new progress toward peace.
 
In March, Bosnian and Croat leaders came to the White House
to sign a peace agreement.  Since then, we've stepped up our
diplomatic efforts to engage the Serbs as well.  As I've
said, if the parties in Bosnia can negotiate a viable
settlement, I will work with the Congress to deploy U.S.
troops through NATO to help enforce that peace.
 
There are other threats today that also demand our active
engagement--from North Korea's nuclear program to the
efforts of Iran and other backlash states to sponsor
terrorism.  We're meeting those threats with steadiness and
resolve.
 
At the same time, we recognize we've entered an age of
historic opportunity.  South Africa's elections offer vivid
proof.  In the Middle East, age-old enemies have extended
handshakes of reconciliation.  In the former Soviet Union,
we're helping to dismantle nuclear weapons once aimed at us.
And just today, Russia and Latvia signed a historic
agreement to withdraw remaining Russian military forces from
Latvian territory by the end of August.  These and other
promising developments were made possible in part by
American support and resolve.
 
But such engagement requires resources commensurate with our
challenges.  With the Cold War behind us, we've been able to
reduce spending on defense and foreign affairs.  We've put
those programs under tight budgetary constraints.  But now
we're at the razor's edge of a resource crisis.  We cannot
afford to short-change our national security.  That is why I
am working hard against further cuts in our defense budget
and why I am working with Congress to make sure we
adequately fund peace-keeping and other international
efforts that promote the security and prosperity of our own
people.
 
As we approach the 50th anniversary of the D-Day invasion
this June, we should recall the spirit of sacrifice and
common cause that marked the great crusade for freedom in
World War II.  In five weeks, I will travel to Europe to
commemorate D-Day and  honor those in the Second World War
who fought to defend our democratic way of life.  The world
is different now--better because of their courage.  And we
owe it to them to build a better future for the next
generation.
 
As we salute the veterans who will be landing by the
thousands in Normandy this June and as we celebrate South
Africa's elections today, let us remember that American
leadership in a changing world requires sustained
commitment.  Together, let us shape this new world to our
lasting benefit.  (###)
 
 
 
ARTICLE 2:
 
Statements by President Clinton
 
South Africa Congratulated On Start of Elections
Statement released by the White House, Office of the Press
Secretary, Washington, DC, April 26, 1994.
 
On behalf of all Americans, I want to congratulate the
people of South Africa on the start of the three-day
elections now taking place in their country.  Today's images
of South Africans--black and white--going to the polls in
the face of intimidation by vicious opponents of democracy
inspire the imagination and are a stern rebuke to the cynics
of the world.
 
South Africans are taking control of their own destinies and
preparing to tackle the fundamental challenges of
establishing a government of national unity, restoring
stability and prosperity, and improving the lives of the
South African people.  I am proud of the role so many
Americans have played in the struggle against apartheid.  I
can assure South Africans that we will be just as involved
in helping to build the non-racial democracy that can come
in its wake.
 
 
Situation in Rwanda
Text of radio message released by the White House, Office of
the Press Secretary, Washington, DC, April 30, 1994.
 
The horrors of civil war and mass killings of civilians in
Rwanda since the tragic deaths of the Rwandan and Burundian
Presidents three weeks ago have shocked and appalled the
world community.  On behalf of all of the American people, I
call on the Rwandan Army and the Rwandan Patriotic Front to
agree to an immediate cease-fire and return to negotiations
aimed at a lasting peace in their country.
 
I applaud the efforts of regional leaders actively engaged
in the quest for peace.  I reaffirm the American commitment
to participate in renewed negotiations under the Arusha
framework.
 
The pain and suffering of the Rwandan people have touched
the hearts of all Americans.  It is time for the leaders of
Rwanda to recognize their common bond of humanity and to
reject the senseless and criminal violence that continues to
plague their country.
 
 
Latvia and Russia Agree on Withdrawal of Military Forces
Statement released by the White House, Office of the Press
Secretary, Washington, DC, April 30, 1994.
 
I applaud today's agreement signed by Latvian President
Guntis Ulmanis and Russian President Boris Yeltsin that will
lead to the withdrawal of Russian military forces from the
territory of the Republic of Latvia by August 31, 1994.  I
have contacted both leaders to offer my personal
congratulations for their vision and statesmanship in
concluding this historic accord.
 
Since the early days of my Administration, among my highest
foreign policy priorities has been promoting agreement on an
orderly withdrawal of Russian forces from the Baltic
countries.  I discussed this frequently with President
Yeltsin and President Ulmanis.  The United States has played
an active role with both parties during the course of the
Latvian-Russian negotiations.  I believe that our engagement
with both sides, along with the support provided by other
countries, in particular Sweden, has played a constructive
role in bringing this agreement to a successful conclusion.
 
Over the course of their negotiations, both the Latvian and
Russian Governments displayed a pragmatic approach to
resolving their differences.  The understandings that this
document embodies, including the continued operation of the
radar installation at Skrunda as a civilian facility, are
testimony to the determination of both sides to conclude an
agreement that responds to Russian concerns while affirming
Latvia's full and unrestricted sovereignty and promoting its
integration into the world community.
 
The agreement between Latvia and Russia now opens the door
to a more normal relationship between the two countries.  It
constitutes an important contribution to overall stability
in the Baltic region and to European security as a whole.  I
hope that this agreement also will help stimulate a speedy
conclusion of the troop withdrawal negotiations between
Estonia and Russia.
 
 
International Fishery Conservation
Text of a letter to the Senate transmitting an agreement on
fisheries conservation, released by the White House, Office
of the Press Secretary, Washington, DC, April 25, 1994.
 
To the Senate of the United States:
 
With a view to receiving the advice and consent of the
Senate to acceptance, I transmit herewith the Agreement to
Promote Compliance With International Conservation and
Management Measures by Fishing Vessels on the High Seas,
which was adopted at Rome by consensus by the Conference of
the United Nations Food and Agriculture Organization ("FAO")
on November 24, 1993.
 
This Agreement was negotiated largely on the initiative of
the United States, in response to the fisheries crises that
have arisen in many corners of the world.  In my view, it
represents a significant breakthrough and offers the
international community an opportunity to develop
responsible fishing practices on a global basis.  The
Agreement, once implemented, will begin to resolve many of
the problems that have undermined the sustainability of high
seas fishing resources.  By becoming party to this
Agreement, the United States would continue to demonstrate
its commitment to preserving these resources and the
livelihoods that depend on them.
 
The Agreement sets forth a broad range of obligations for
Parties whose fishing vessels operate on the high seas,
including the obligation to ensure that such vessels do not
undermine international fishery conservation and management
measures.  Parties must also prohibit their vessels from
fishing on the high seas without specific authorization and
must take enforcement measures in respect of vessels that
contravene requirements flowing from the Agreement.
 
The Agreement also creates an important role for the FAO as
a clearinghouse of data relating to high seas fishing.
Through the collection and dissemination of such data, it
will be possible to improve our knowledge of all high seas
fisheries, which is of critical importance if the
international community is to protect these valuable
resources successfully.
 
I recommend that the Senate give early and favorable
consideration to the Agreement and give its advice and
consent to acceptance.
 
William J. Clinton  (###)
 
 
 
ARTICLE 3:
 
U.S. Economic Policy and the Asia-Pacific Region:  The
Search For Balance
Joan E. Spero, Under Secretary for Economic and Agricultural
Affairs
Address before the Asia Society, New York City, April 20,
1994
 
It is a pleasure to be with you today.  As many of you know,
New York is my home, and it always feels good to come home.
I especially welcome the opportunity to speak to the Asia
Society, one of the greatest New York institutions.  I have
often enjoyed your public policy programs and your art
exhibits.
 
This is a particularly opportune time to discuss our foreign
economic policy and the Asia-Pacific region.  Because of
your interest in both of these subjects, I couldn't find a
better audience.
 
Last year, with the Tokyo summit, President Clinton's visit
to Asia, the launching of the Japan framework, and the
historic meeting of Asia-Pacific leaders in Seattle, there
was tremendous interest in and excitement about our Asia
policy.  There was growing awareness of the economic
opportunities of the Asia-Pacific region.  The American
people saw a bright future there, and public confidence in
our policies was high.
 
Now the pendulum of public perception is swinging in the
opposite direction, with undue pessimism.  Today, there is a
spate of articles claiming that our policy is adrift.
You've seen the stories:  "Clinton Plans for 'Pacific
Community' Snag" (April 14, Christian Science Monitor) and
"Asia, on the Ascent, Is Learning To Say No to Arrogant
West" (April 13, Wall Street Journal).
 
Despite the shift in headlines, the opportunities and the
potential of the Asia-Pacific region remain.  And our
policy, squarely focused on seizing the opportunities and
developing the potential, has not changed.
 
Let's take a brief look at the basic principles underlying
our policy and then see where we stand today.
 
First, a key insight of the Clinton Administration's Asia
policy and, indeed, its foreign policy generally is
recognition of the critical link between foreign and
domestic economic policy and the new centrality of economics
in our foreign relations.  The logic is simple.
 
On the one hand, to be strong and self-confident in world
affairs, we must first be strong and self-confident at home.
We need to get our domestic economic house in order if we
are to have capability and credibility in our foreign
policy.
 
At the same time, our economic well-being at home is
increasingly linked to our engagement in the world.   We
need access to markets for our goods and services.  That is
why the passage of NAFTA and the Uruguay Round agreement are
so important.  As President Clinton has pointed out
repeatedly, "we intend to compete, not retreat."  And
finally, with economics moving center stage, there is no
region more important to our future than the fastest-growing
and most economically dynamic area in the world--the Asia-
Pacific region.
 
Our second principle is to work toward the realization of a
"Pacific Community."  As the President outlined in Tokyo and
Seoul last year, that community should be built on shared
strength, shared prosperity, and a shared commitment to
democratic values.  A continued strong U.S. commitment to
the region's security creates the environment for economic
development, growing markets, and flourishing trade.  We
are, therefore, developing through the ASEAN Regional Forum
a new regional approach to security to supplement our five
bilateral security alliances in Asia.  The forum, notably,
will include the U.S., Japan, China, Russia, the ASEAN
countries, Vietnam, Australia, and others.  Secretary
Christopher will participate in the historic first meeting
of the forum this July in Bangkok.
 
We also are pursuing the economic opportunities in Asia:
globally, with the successful conclusion of the Uruguay
Round; regionally, through the promising development of
Asia-Pacific Economic Cooperation, or APEC; and bilaterally,
through efforts such as the Japan framework and our dialogue
for economic cooperation with Korea.  And of course, the key
here is the rising competitiveness of U.S. business and its
growing interest in Asia.
 
We are working in Asia to advance democratic values and our
global agenda, including non-proliferation, protection of
the environment, and human rights.  To reduce the spread of
weapons of mass destruction, we are encouraging India and
Pakistan to reduce tensions and cap their nuclear programs.
We are making similar efforts with others on North Korea.
Advancing protection of the environment also offers us a
special opportunity.  Rapidly growing Asian countries face
huge environmental challenges and want and need U.S.
environmental technologies.  We are cooperating with Asian
partners through programs such as the U.S.-Asian
Environmental Partnership, forests and biodiversity programs
in Indonesia, and other exchanges, including the first-ever
APEC environment ministers meeting this spring.  Our human
rights efforts are not simply exhortation but include USAID,
USIA, and Department of Defense programs, as well as support
for non-governmental organizations such as the National
Endowment for Democracy, the Asia Foundation, the U.S.
Institute for Peace, and the East-West Center.
 
Finally, we are continuing to build the architecture of a
community that spans the Pacific.  We take the existence of
the "Atlantic community" for granted, but the elements of a
Pacific community are only now just developing.  The
successful APEC ministerial in Seattle and the unprecedented
leaders meeting hosted by President Clinton showcased that
effort, but the work goes on and the momentum continues.
APEC finance ministers met for the first time last month in
Honolulu and agreed to take steps to facilitate the capital
flows necessary to meet the region's enormous infrastructure
development needs.  APEC environment ministers met this
month in Vancouver, again for the first time.  We look
forward to a second APEC leaders meeting to be hosted by
President Soeharto in Indonesia this fall.
 
The Problem:  Competing Goals
In short, our goals in Asia are consistent, focused on
seizing Asia's potential and meeting its challenges, and
widely supported by Americans.  Who doesn't want to see
sustainable, market-oriented economic growth?  What American
opposes greater U.S. access to Asian markets, investment
opportunities, and technology?  Who among us does not
believe that our environment and endangered species should
be better protected, that democracy and human rights should
be universal values, or that proliferation of weapons of
mass destruction should be countered?  We all agree on these
policy objectives at a general level.
 
Then why the negative headlines now?  The facile answer is
that enunciating goals is easier than implementing them.
But there is more to it than that.
 
The public focus at the time of the Tokyo summit and the
APEC leaders meeting was on economic opportunities in the
region, the long-term potential, and the broad vision of
America's future as a Pacific power.  The Clinton
Administration, rightly, won plaudits for this focus and its
new attention to a part of the world so important to
America's future.
 
We also won plaudits for our determination to tackle the
significant challenges that we face in the region--and there
are many.  On the economic side, we face real problems,
including market access and protection of intellectual
property.  Asia is also the region in which the host of new
global issues demands attention.  Asia contains countries
which possess nuclear weapons or are trying to develop them.
It contains countries which sponsor state terrorism and
countries which are undemocratic and abuse human rights.
The region is the world's primary source of heroin.  It
faces tremendous environmental challenges.  All of the
challenges we face in the post-Cold War era, and all of our
interests, come together in Asia.  We are working actively
to seize the opportunities and also to meet the challenges.
But we do have multiple goals, and sometimes it is difficult
to achieve them all at the same time.  When these goals
conflict, what will guide us?
 
During the Cold War, the hierarchy was clear:  security
first, other issues second.  But now the Cold War is over,
and direct threats to our own security have receded.  What
now is our hierarchy of goals as we look at the world?  How
do we come to grips with the new global issues?
 
It is clear that not everyone agrees.  In the absence of the
Cold War's defining principle, or a new and agreed hierarchy
of interests to replace it, many groups assert that their
objectives should be the primary goal of U.S. foreign
policy.  In my view, we as a nation are in the midst of a
fundamental, but as yet largely unanswered, foreign policy
debate over how to adapt to the post-Cold War world and,
specifically, the values and interests that will guide us.
 
The answer, in my view, lies in striking a balance among
these competing policy priorities--recognizing that the
"right" balance may not be the same in all cases.
Complicating this search for the right balance among our
foreign policy interests is the absolute increase in the
importance of economics.  In the conduct of our diplomacy,
particularly during the Cold War, we tended to divorce the
economic and political components as we pursued our national
interests.  Economics, and our economic strength, were taken
for granted.  Economics was there to be used--to pay for our
military strength; to provide assistance for other nations,
often for political and not economic reasons; or to be used
as leverage to attain non-economic goals when the Soviet
Union or others misbehaved.  But for the United States to
pursue its economic interests abroad, to care about jobs and
exports for its people and companies, to demand that other
countries grant us the same access to their markets in trade
and investment that we give them to ours--all this was seen
as secondary or even unworthy for a great nation like ours.
 
But today, economics matters.  Trade accounts for a greater
percentage of our economy than at any time since we became a
world power.  The world is more important to us economically
than ever before.  Economic isolationism is not an option
for us.  At the same time, with the post-war growth in
Europe and Asia, we are a less dominant economic force than
we once were.  There are other markets and other sources of
supply.  As a result, in some cases unilateral economic
sanctions may have more of an impact on the U.S. economy
than on the behavior of a foreign country.
 
We have encountered the conflicts arising from competing
policy goals in a number of our key relationships in Asia,
raising questions, and not a little criticism, from both
Asians and Americans.
 
Human Rights and Economic Sanctions
Some have asked why, if economics is so central to our
foreign and domestic policy, we persist in tying non-
economic issues, such as human rights, to our economic
relations.  Those who oppose the emphasis we place on human
rights today say that economic growth and trade, and greater
interchange of people and information, will inevitably lead
to democracy and greater respect for human rights.  So we
should leave things alone and let economic and political
nature run its course.  But according to that great apostle
of capitalism, Milton Friedman--whoever thought a Democratic
Administration official would quote Milton Friedman--even
Milton Friedman has said, "History suggests that capitalism
is a necessary condition for political freedom.  Clearly it
is not a sufficient condition."
 
We asked our experts at the State Department to go past our
memories and look carefully at recent history, and Friedman
was right.  Economic growth and trade expansion have been a
powerful force in the movement from authoritarian regimes to
more pluralistic, democratic societies over the past two
decades.  But there also is a familiar pattern in which
traditional political elites try to prevent political reform
and respect for human rights from moving in parallel with
economic reform.  In all four cases commonly cited--Taiwan,
South Korea, Chile, and Spain--external pressure, usually
from the United States, played a role in ensuring further
movement toward political reform and the protection of human
rights.  In short, economic freedom and trade helped stir
things up and create the conditions for change.  But by
themselves they were not enough.
 
Nowhere is this more evident than in China.  And since I
know you will ask, let me say now that I fully support the
President's executive order on China MFN.  I hope that China
will take the steps that will allow this very important
economic relationship to continue to develop.  We are not
imposing U.S. values.  We ask only that China live up to its
commitments to meet internationally recognized standards of
human rights.
 
As Under Secretary for Economic Affairs, I am proud to be
part of an Administration that places a greater emphasis on
our international economic interests than any of its
predecessors.  But I am also proud to be part of an
Administration that appropriately places a renewed emphasis
on democracy and human rights and on non-proliferation and
the environment as key concerns in our foreign policy.
 
The conflicts we face in pursuing our foreign policy goals
are not just between economics and human rights.  We face
trade-offs involving non-proliferation and narcotics,
workers' rights, and the environment.  We cannot abandon or
sacrifice any of these basic policy goals.  All of them are
important to our interests and reflect basic American
values.
 
Promoting While Controlling Exports?
Export controls are a good example.  The dynamic economic
growth in Asia has made it a critical market for our nation.
This Administration has made export promotion a priority.
Exports are the main link between growing overseas markets
and domestic jobs.  The Commerce Department has designated a
number of Asian countries "big emerging markets" and has
geared up to promote exports to these attractive markets.
Our embassies overseas and the Department of State as well
are working closely with American business toward this end.
Yet, we continue to control exports in order to advance our
non-proliferation, security, and other foreign policy
interests.
 
Once again, we face a question of balance.  We do need the
flexibility to deny certain exports to further our national
security objectives.  But, with the Cold War over, we have
taken actions recently to ease controls on computers,
supercomputers, and telecommunications and to provide
accelerated procedures for licensing encryption technology.
 
The Administration has also proposed a revised Export
Administration Act which will lessen further the burden of
controls on our exporters by making procedures quicker and
more transparent.  Since unilateral controls and sanctions
are particularly costly to U.S. companies, from now on we
will use them only after the commercial costs are carefully
weighed.  I should note, however, that in some cases, such
as in the non-proliferation area, we are legally prohibited
from considering the commercial impact on the United States.
We are also working to replace COCOM with a multilateral
regime that will more effectively prevent renegade states
from acquiring sensitive weapons technology, while creating
a more level playing field for U.S. exporters.
 
Japan is another good example of an area in which we are
making progress in reaching the right balance.  As Secretary
Christopher told a leading business group in Tokyo in March:
 
We cannot realize the full potential of our relationship
unless we have harmony and  strength among all its elements.
We must make our economic and trade links as mutually
beneficial as our political and security bonds.
 
This will strengthen a relationship that is important not
only for the U.S. but for Asia and the world as well.  While
our framework talks are on hold for the moment, we are
hopeful that the new government in Japan, once formed, will
continue the process of reform and deregulation, will take
steps to re-invigorate its economy and open its market, and
will enable us to get back to the negotiating table.  Part
of our framework is our successful cooperation with Japan to
tackle important global issues, including the population,
AIDS, and the environment.  This "Common Agenda for Global
Cooperation" also demonstrates our commitment to balance in
this key Asian relationship.
 
Resolving Policy Conflicts:  Multiple Goals and Making
Choices
 
Competing interests make for difficult policy choices.
Solutions will not come easily for us after the Cold War.
In addition to balancing policy goals, we must ensure that
the measures we employ to pursue them will bring the desired
results--and at an acceptable political and economic cost.
The President has emphasized that economics is at the center
of American foreign policy, and many of the policy choices
we face in Asia directly affect our economic interests.
This requires a careful weighing of the impact on our
economic well-being in policy-making.  There can be no hard
and fast rules, but let me leave the following suggestions
with you.
 
First, we need to know clearly just what the economic cost
of an action will be--to us and to the foreign country.
This cost then needs to be weighed against the likely policy
benefit.  I am not arguing that economics takes primacy over
all our other interests as a nation or that it has replaced
security as the new organizing principle of our foreign
policy.  I am saying that the costs and benefits of all of
our interests need to be weighed against each other.
 
Second, we should look at those areas where we have
traditionally used economic leverage to achieve non-economic
objectives, to see whether unilateral American action is
sufficient to produce the desired change in behavior by a
foreign government.  In a world with other markets and
sources of supply, linking economics to non-economic changes
often can produce symbolism, not leverage.  We still may
decide that the behavior of a foreign country is such that
we will withdraw economic benefits, but we need to decide
this with our eyes open--and not from a mistaken belief that
our linkage is all-powerful.
 
Third, we should attempt to pursue and incorporate our
objectives in multilateral regimes whenever possible.  While
we would still need to take bilateral steps in some cases, a
multilateral approach would lessen the need for unilateral
actions and thus reduce bilateral tensions.  It also would
demonstrate that these are universal and not just American
concerns.  Such an approach could prove productive in the
new Asia.  This is our goal in proposing to introduce labor
standards into the new World Trade Organization.  Protection
of the environment is another area which would benefit from
broader, multilateral efforts.  In the case of non-
proliferation, there are already a number of multilateral
groups in existence which cooperate to control exports of
chemicals and nuclear components.
 
Fourth, we need to continue to rely on our private sector--
both business and non-governmental organizations.  Through
good labor practices, enlightened environmental policies,
and good corporate citizenship in its operations around the
world, U.S. business can be a strong, positive force for
promoting the principles in which all Americans believe.
And our non-governmental organizations, by working with host
governments in a cooperative, positive manner while pointing
out areas for improvement, can reduce the perception in many
countries that they are hostile or accusatory.
 
Finally, I would add that style may also be a factor.
Asians generally welcome our leadership--if we do it right.
It is often said that, in Asia, style is as important as
substance.  Consulting carefully in advance, seeking
consensus rather than confrontation, delivering tough
messages in private rather than public--these are perceived
as more Asian than American traits.  But they are traits to
which we must become increasingly attuned.
 
As a result of dynamic economic growth, Asians are now more
confident--not just economically but politically and
culturally as well.  They are justifiably proud of their
accomplishments and increasingly willing to put forward
their institutions and societies as models.  They are more
willing to speak out, and they see less need to accommodate
the United States.  As more and more Asian nations establish
themselves as successful, self-confident societies--and as
more Asian governments become stronger democracies that are
answerable to their legislatures, their opposition, their
press, and the public--they will increasingly want to do
things their way or, at least, have a greater say in their
relations with us.
 
The habits of consultation we have developed with ASEAN and
within APEC should serve us well in the future.  But we will
need to balance Asian desires for consensus and consultation
against our occasional need to act unilaterally and publicly
on matters that are essential to U.S. interests and the
values of the American people.  In showing a better
understanding of Asian concerns and values, we cannot
abandon our own.
 
Conclusion
In conclusion, getting the balance right is especially
important in Asia.  Asia is the most economically dynamic
region in the world and thus critical to our economic
future.  It also, as I noted, is the site of some of the
most difficult global issues that we must deal with in the
post-Cold War era, from the proliferation of nuclear
weapons, to the abuse of human rights, to the degradation of
our common environment.
 
Our goal of creating a "Pacific Community" is the right one,
and our determination to pursue the President's vision is
unshaken.  But the "rubber is now hitting the road," and as
we have seen, the road to community will not always be
smooth.  But the journey must continue.
 
Earlier, I expressed my view that we as a nation are in the
midst of a fundamental, but as yet largely unanswered,
foreign policy debate over what values and interests should
guide us in the post-Cold War era and what balance we should
strike among competing policy priorities.  This is not a
decision for the Administration alone,  these are decisions
for all Americans. And as we travel the road toward a
Pacific community, we will need the ideas, the advice, and
the support of groups such as yours.  (###)
 
 
 
ARTICLE 4:
 
Fact Sheet:  Armenia
 
Armenia at a Glance
Armenia is the second most densely populated of the former
Soviet republics.  It is a land-locked country between the
Black and the Caspian Seas, bordered on the north and east
by Georgia and Azerbaijan and on the south and west by Iran
and Turkey.
 
After the destruction of the Seleucid Empire, the first
Armenian state was founded in 190 BC.  At its zenith,
between 95-55 BC, Armenia extended its rule over eastern
Turkey.  For a time, Armenia was the strongest state in the
Roman East.  It eventually became part of the Roman Empire
and adopted a Western political, philosophical, and
religious orientation.  In 301 AD, Armenia became the first
nation to adopt Christianity as a state religion,
establishing in the 6th century a church that still exists
independently of both the Catholic and the Eastern Orthodox
churches.
 
During its political eclipse, Armenia depended on the church
to preserve and protect its unique identity.  For a brief
period between 1918 and 1920, Armenia was an independent
republic, but in 1922, it became part of the Trans-caucasian
Soviet Socialist Republic.  In 1936, it became the Armenian
Soviet Socialist Republic.  It declared its independence on
September 23, 1991.
 
The territory of Armenia is about 30,000 square kilometers.
According to 1991 estimates, the population of Armenia is
3.3 million.
 
Principal Government Officials
President:  Levon Ter-Petrosyan
Prime Minister:  Grant Bagratyan
Foreign Minister:  Vahan Papazyan o
 
U.S.-Armenian Relations
The dissolution of the Soviet Union in December 1991 brought
an end to the Cold War and created the opportunity to build
bilateral relations with the New Independent States (NIS) as
they began a political and economic transformation.  The
U.S. recognized the independence of Armenia on December 25,
1991, and opened an embassy in the capital, Yerevan, in
February 1992.  The U.S. Ambassador is Harry Gilmore.
 
In January 1992, the U.S. initiated the Coordinating
Conference on Assistance to the New Independent States in
response to the humanitarian emergencies facing these
states.  The resulting Operation Provide Hope provided
desperately needed food, fuel, medicine, and shelter.
 
The cornerstone of the continuing U.S. partnership with
Armenia and the other NIS is the Freedom for Russia and
Emerging Eurasian Democracies and Open Markets (FREEDOM)
Support Act, enacted in October 1992, which directly
addresses their military, political, and economic
transformation.  On September 30, 1993, a new $2.45-billion
assistance package for the NIS, funded with a combination of
fiscal year (FY) 1994 and 1993 supplemental appropriations,
was passed by Congress and signed into law by President
Clinton.  It will continue to address political and economic
transformation and humanitarian needs.
 
Through December 1993, the U.S. provided about $305 million
in humanitarian assistance and $30 million in technical
assistance to Armenia.  The focus of U.S. assistance is the
provision of humanitarian assistance and support for
Armenia's transition to a market economy and transition to
democracy.
 
Humanitarian Assistance.  In response to disaster
declarations by the U.S. Ambassador to Armenia in February
1994 and December 1993, $50,000 has been provided by the
U.S. Agency for International Development's  (USAID) Office
of Foreign Disaster Assistance for bread and food/fuel
shortages.
 
Under Operation Provide Hope, launched in February 1992, the
U.S. has delivered food worth about $3.8 million and
medicines and medical supplies worth $6 million to Armenia.
The Medical Assistance Initiative, administered by Project
HOPE, a private voluntary agency, has shipped about $13
million worth of pharmaceuticals and medical supplies and
has implemented a children's immunization program valued at
$1.5 million.  The U.S. delivered more than $2 million worth
of excess Department of Defense pharmaceuticals and medical
supplies in 1992 and 1993.  Under the Emergency Medicines
Initiative, about $500,000 worth of emergency medicines were
delivered.  In FY 1994, the U.S. Department of Agriculture
expects to provide about 140,000 metric tons of food aid,
valued at about $66 million.  USAID expects to provide
another   $11 million in food aid specially targeted to the
nutritional needs of children and postpartum women.
 
USAID has funded a nutritional surveillance team from the
Centers for Disease Control to conduct quality control
assessments to improve nutritional survey data collection.
The U.S. has provided $12 million for earthquake assistance
and pledged $5 million for assistance for Armenian refugees.
 
In response to Armenian President Ter-Petrosyan's December
8, 1992, Declaration of National Emergency, the U.S.
provided more than $1 million in funding to private
voluntary organizations to assist the most vulnerable groups
in Armenia with food, fuel, blankets, and medicines;
$377,000 for emergency need assessment and training in
emergency management; $1.6 million to the UN World Food
Program to help resolve transportation problems in food
delivery; and $15 million to buy transport kerosene and
kerosene heaters and containers.  It also arranged for the
transport of urgently needed antibiotics, anesthetics,
measles vaccines, medical supplies, additional kerosene
heaters, and infant formula.  It has contributed about $5
million to fund the transport of donated fuel supplies to
both Armenia and Georgia and also paid shipping costs for
the transport of 72,000 metric tons of  heating fuel from
Russia to Armenia.
 
Assistance To Support the Transition to a Market Economy.
Technical assistance and training programs have been
provided in agricultural development and agribusiness,
economic reform, democracy and the market economy,
international economics, the establishment of a Junior
Achievement program, power plant construction and
production, energy efficiency, housing law and regulation,
and public health surveillance.  Two medical partnerships
have been established between a Salt Lake City health care
facility and three Boston hospitals, and three Yerevan
hospitals.  The Peace Corps is working in Armenia with a
focus on small business development and English teaching.
 
  Assistance To Support the Transition to Democracy.
Technical assistance and training programs have been
provided in municipal administration, intergovernmental
relations, public affairs, foreign policy, diplomatic
training, rule of law, development of a constitution,
independent media, and English teaching.  Educational
exchange programs play an important role in these areas.
Assistance in the translation and publication of printed
information also has been provided.  The U.S. Information
Agency's American Resource Center contains books and
periodicals on democratic institutions, market economy and
free press issues, in addition to an English teaching
resource center with texts, and video and audio tapes.
 
Bilateral Economic Relations.  On April 2, 1992, the U.S.
and Armenia concluded a trade agreement which provides
reciprocal most-favored-nation status to the products of
each country and guarantees intellectual property
protection.  The government has appointed American citizens
to several economic policy positions and encourages Western
investment.
 
An Overseas Private Investment Corporation agreement with
Armenia, which will encourage U.S. private investment by
providing direct loans and loan guarantees and by assisting
with project/investor matching, entered into force on April
2, 1992.   A bilateral investment treaty was signed on
September 23, 1992, and awaits ratification by Armenia.
 
Military Issues.  Armenia has declared that it will abide by
all of the relevant arms control obligations of the former
Soviet Union, including adherence to the nuclear Non-
Proliferation Treaty as a non-nuclear weapons state.  The
Conventional Armed Forces in Europe (CFE) Treaty was
ratified by the Armenian Parliament in July 1992.  Following
ratification by Armenia and seven other NIS, it entered into
force on November 9, 1992.  The treaty establishes
comprehensive limits on key categories of military
equipment, such as tanks, artillery, armored combat
vehicles, combat aircraft, and combat helicopters, and
provides for the destruction of weaponry in excess of those
limits.  Although Armenia did not provide the data on its
conventional forces required by the treaty as of July 1992,
it has provided other CFE notifications and has accepted on-
site inspections of forces on its territory.
 
Political Conditions
Armenians voted overwhelmingly for independence in a
September 1991 referendum, followed by a presidential
election in October that gave 83% of the vote to President
Levon Ter-Petrosyan.  Ter-Petrosyan was elected head of
government in 1990 elections, when the Armenian National
Movement defeated the Communist Party.  By law members of
the executive branch, including the president, may not
belong to a political party.
 
The government is dominated by the anti-communist,
nationalist Armenian National Movement, which is the largest
party in the highly fractious Supreme Soviet.  Opposition
parties exist but have limited support.  The Armenian
Communist Party declared itself independent of the all-Union
Communist Party in November 1990 and reconstituted itself as
the "Movement for Social Democracy."  Its assets were
nationalized in April 1991.  Presidential and parliamentary
elections are scheduled for 1995.
 
The inability of parliament to ratify a new constitution and
ongoing rivalry between the president and the parliament
have limited Armenia's progress toward substantive political
and economic reform.  Although freedom of the press and
speech are guaranteed, the government maintains its monopoly
over television and radio broadcasting.  Freedom of religion
and the right of peaceful assembly are observed, although
there are restrictions on proselytizing.  International
travel is somewhat limited by the continued validity of
Soviet regulations requiring exit visas.  Legislative reform
of the judicial system, unchanged from the Soviet period,
has not been addressed.  The National Security Agency has
replaced the Committee for State Security (KGB) and as yet
there is incomplete legal protection for the privacy of
citizens.  Legislation guarantees the right of workers to
form or join unions and to bargain collectively.  Although
laws privatizing state enterprises exist,  nearly all remain
under state control.
 
Armenia established a Ministry of Defense in 1992.  Border
guards subject to the ministry patrol Armenia's borders with
Georgia and Azerbaijan, while Russian troops continue to
monitor its borders with Iran and Turkey.
 
In 1988, the territory of Nagorno-Karabakh, a predominantly
ethnic Armenian enclave within Azerbaijan, voted to secede
and join Armenia.  Armenian support for the separatists led
to an economic blockade by Azerbaijan, which has crippled
Armenia's foreign trade and restricted its imports of food
and fuel, three-quarters of which transited Azerbaijan under
Soviet rule.   President Ter-Petrosyan has resisted domestic
pressure to recognize the self-proclaimed independence of
the "Nagorno-Karabakh Republic."  Ethnic Azeris who fled
Armenia or were deported in 1988-89 remain refugees,
primarily in Azerbaijan.  Armenia, in turn, has received the
lion's share of the roughly 400,000 ethnic Armenians who
have fled Azerbaijan since 1988.
 
Efforts are underway within the Conference on Security and
Cooperation in Europe (CSCE) to seek a peaceful, negotiated
settlement to the conflict between Armenia and Azerbaijan
for control of Nagorno-Karabakh.  The talks have focused on
securing a cease-fire monitored by a CSCE observer group.
Azerbaijani preconditions for a cease-fire and procedural
disputes over the status of the Nagorno-Karabakh delegation
have delayed negotiations.  Some progress was made in
February and March 1993, but the peace process again was
disrupted by the seizure of Azerbaijan's Kelbajar district
by Nagorno-Karabakh Armenian forces in April.  In June 1993,
all parties to the conflict accepted a proposal by the Minsk
Group (comprised of Armenia, Azerbaijan, Russia, Turkey, the
U.S., and six European countries, plus representatives of
the Armenian and Azeri communities of Nagorno-Karabakh) to
secure a cease-fire, a partial withdrawal from occupied
territory, deployment of international monitors, the lifting
of blockades, and the resumption of negotiations.
Implementation of this proposal has been delayed.
 
Foreign Relations
Armenia is a member of the Commonwealth of Independent
States (CIS), the United Nations, the CSCE, and the North
Atlantic Cooperation Council.
 
Economic Outlook
Like other New Independent States, Armenia's economy suffers
from the legacy of a centrally planned economy and the
breakdown of former Soviet trading patterns.  In addition,
the effects of the 1988 earthquake, which killed more than
25,000 people and made 500,000 homeless, are still being
felt.  Finally, the ongoing conflict with Azerbaijan has led
to a blockade which, since Armenia is dependent on outside
supplies of energy and most raw materials, has devastated
the economy.  Land routes through Azerbaijan and Turkey are
closed; routes through Georgia and Iran are inadequate or
unreliable.  In 1992, GDP fell to about one-third of its
1989 level, and the decline continued in 1993.  Unemployment
and inflation are high.  About 95% of the population is
estimated to live below the official poverty line.  Food and
energy are in critically short supply.
 
Despite these difficult economic conditions, the government
has moved rapidly on economic reforms.  Agricultural land
was largely privatized in 1991, resulting in a 15% rise in
production in that year.  Privatization of small businesses
is underway.  Prices, except for bread, public utilities,
and transport, are deregulated.  Legislation on property,
taxes, mortgages, and banking has been passed or is pending.
Armenia introduced its own currency, the "dram," in November
1993.
 
Armenia's economy is largely industrial--chemicals,
electronic products, machinery, processed food, synthetic
rubber, and textiles--and highly dependent on outside
resources.  Agriculture accounted for only 20% of net
material product and 10% of employment before 1991.
Armenian mines produce copper, zinc, gold, and lead.  About
95% of energy is imported; the main domestic energy source
is hydroelectric.  Small amounts of gas and petroleum could
be developed.
 
Armenia is a member of the International Monetary Fund, the
World Bank,  and the European Bank for Reconstruction and
Development.
 
Environmental Issues
Armenia is attempting to address its environmental problems.
It has established a Ministry of Environment and has
introduced a pollution fee system by which taxes are levied
on air and water emissions and solid waste disposal, with
the resulting revenues used for environmental protection
activities.  Armenia is interested in cooperating with other
CIS states and with members of the international community
on environmental issues.  (###)
 
 
 
 
ARTICLE 5:
 
Fact Sheet:  Azerbaijan
 
Azerbaijan at a Glance
Azerbaijan combines the heritage of two venerable
civilizations--the Seljuk Turks of the 11th century and the
ancient Persians.  The Azerbaijan Republic borders Iranian
Azerbaijan, although the two have never been politically
united as a single state.
 
Azerbaijan was conquered and Islamized by the Arabs in 642
AD.  Centuries of prosperity followed.  Following the
decline of the Arab Empire, Azerbaijan again found
prosperity in the 13th-15th centuries under Mongol rule,
under the native Shirvan Shahs, and under Persia's Safavid
Dynasty.
 
Because of its location astride the trade routes and on the
shore of the Caspian Sea, Turkey, Persia, and Russia fought
to control the area.  Finally, in 1828, the Russians split
Azerbaijan's territory with Persia, along the present
frontier.  After an abortive attempt to form a Trans-
caucasus Federation with Armenia and Georgia, an independent
republic was proclaimed in 1918.
 
Azerbaijan received de facto recognition by the Allies as an
independent state in early 1920 shortly before the Red Army
invaded in April.  It was incorporated into the
Transcaucasus Federated Soviet Republic in 1922, and became
a union republic in 1936.  The Azerbaijanis declared their
independence on August 30, 1991.  Of the population of 7
million, about 83% are Azeris and 6% Russian.  The majority
are Shi'ite Muslims.
 
Principal Government Officials
President:  Heydar Aliyev
Prime Minister:  Surat Huseynov
Speaker of the National Council:  Rasul Quliyev
 
U.S.-Azerbaijan Relations
The dissolution of the Soviet Union in December 1991 brought
an end to the Cold War and created the opportunity to build
bilateral relations with the New Independent States (NIS) as
they began a political and economic transformation.  The
United States opened an embassy in Azerbaijan's capital,
Baku, in March 1992.  The U.S. Ambassador is Richard
Kauzlarich.
 
In January 1992, the U.S. initiated the Coordinating
Conference on Assistance to the New Independent States in
response to the humanitarian emergencies facing these
states.  The resulting Operation Provide Hope, launched in
February 1992, provided desperately needed food, fuel,
medicine, and shelter.
 
The United States is deeply concerned with the ongoing
effort to end the fighting in Nagorno-Karabakh, a
predominantly Armenian enclave inside Azerbaijan, and has
been instrumental in efforts to advance the Conference on
Security and Cooperation in Europe (CSCE) peace process.
 
An important element of the continuing U.S. partnership with
the  NIS is the Freedom for Russia and Emerging Eurasian
Democracies and Open Markets (FREEDOM) Support Act, enacted
in October 1992.  On September 30, 1993, a new $2.45 billion
assistance package for the NIS, funded with a combination of
fiscal year (FY) 1994 and 1993 supplemental appropriations,
was passed by Congress and signed into law by President
Clinton.  It will continue to address political and economic
transformation and humanitarian needs.
 
The FREEDOM Support Act contains restrictions on U.S.
Government assistance to the Government of Azerbaijan until
the President determines, and so reports to Congress, that
the Government of Azerbaijan has taken "demonstrable steps
to cease all blockades and other offensive uses of force
against Armenia and Nagorno-Karabakh."  Thus, humanitarian
and technical assistance may be provided to the Azerbaijani
people through non-governmental organizations, or directly
by the U.S. Government, so long as the provision of
assistance does not require the involvement of the
Government of Azerbaijan.  Assistance to Azerbaijan has been
seriously restricted.
 
Through December 1993, the U.S. provided about $34 million
in humanitarian assistance and $2 million in technical
assistance to Azerbaijan.  The focus of U.S. assistance to
Azerbaijan is the provision of humanitarian assistance and
support for its transition to democracy and transition to a
market economy, as allowed under the FREEDOM Support Act.
 
Humanitarian Assistance.  The U.S. provided $8 million for
American private voluntary organizations to assist the most
vulnerable groups in Azerbaijan with food, fuel, blankets,
and medicines during the winter of 1993.  In November 1993,
an airlift of 20,000 Humanitarian Daily Rations and 1,200
blankets to Azerbaijan was completed, in addition to two
emergency flights that delivered UN World Food Program food
packets.  In November 1993, the U.S. contributed $1.6
million to the UN World Food Program to help resolve
transportation problems that have delayed the delivery of
urgently needed food assistance to all countries in the
Caucasus region.  The U.S. has allocated butter oil, with an
estimated commodity and transportation cost of $772,000,
toward the UN World Food Program Appeal for Azerbaijan.
 
In August 1993, the U.S. provided $1 million each to the
International Committee of the Red Cross and the UN High
Commissioner for Refugees for humanitarian assistance to
displaced persons in Azerbaijan.  In addition, 4,000
blankets were airlifted to Baku for distribution to the
needy, particularly refugees and displaced persons.
 
During Operation Provide Hope, the U.S. delivered food
valued at $1.8 million and medical supplies worth $7.2
million to Azerbaijan.  Under the Emergency Medicines
Initiative, 20 tons of Department of Defense excess medical
supplies were delivered to Baku in February 1993.  An
additional $7,533 worth of medicines, medical supplies, and
medical equipment to be distributed directly to needy
recipients through private voluntary organizations was
delivered in June 1993.  The U.S. also transported 36 tons
of privately donated medical supplies and vegetable seeds to
Baku.
 
Assistance To Support the Transition to Democracy.  Editors
and managers of independent news outlets participated in an
American journalism and media project.  The U.S. Information
Agency is providing television programming to independent
Azerbaijani broadcasters, and a con- tract for Voice of
America radio programming has been signed.  The U.S.
supports a partnership for faculty and curriculum
development in the field of educational reform with a
private Azerbaijani university.  Many students and scholars
from private institutions participate in higher education
exchange programs.
 
Bilateral Trade Issues.  The U.S. and Azerbaijan signed a
bilateral trade agreement in April 1993; it awaits
ratification by the Azerbaijani parliament.  An Overseas
Private Investment Corporation agreement was signed in
September 1992 and is being reviewed by parliament.
 
Military Issues.  In July 1992, Azerbaijan ratified the
Conventional Armed Forces in Europe (CFE) Treaty, which
establishes comprehensive limits on key categories of
conventional military equipment and provides for the
destruction of weaponry in excess of those limits.  Although
it did not provide all data required by the treaty on its
conventional forces at that time, it has provided other CFE
notifications and has accepted on-site inspections of forces
on its territory.  It also has acceded to the nuclear Non-
Proliferation Treaty as a non-nuclear weapons state.
 
Political Conditions
Azerbaijan declared its independence from the former Soviet
Union on August 30, 1991.  Ayaz Mutalibov, First Secretary
of the Communist Party, became President of the Republic.
The country experienced a period of political instability
after he resigned in March 1992, following a massacre of
Azerbaijanis in Nagorno-Karabakh.  A parliamentary coup in
May 1992 returned Mutalibov to power.  His efforts to
suspend scheduled presidential elections and to ban all
political activity prompted the opposition Azeri Popular
Front (APF) to organize a resistance movement and to take
power in a countercoup.  The APF dissolved the predominantly
Communist Supreme Soviet and transferred its functions to
the 50-member upper house of the legislature, the National
Council.
 
Elections held in June 1992 resulted in the selection of APF
leader Abdulfaz Elchibey as president.  The APF government,
however, proved incapable of ending the Nagorno-Karabakh
conflict or managing the economy, and many APF officials
were perceived as corrupt and incompetent.  In June 1993, an
armed insurrection broke out in Ganje, Azerbaijan's second
largest city.  As the rebels advanced virtually unopposed on
the capital, President Elchibey fled to his native region of
Nakhchyvan.  The National Council conferred presidential
powers upon its new Speaker, Heydar Aliyev, a former
Communist Party First Secretary and U.S.S.R. Politburo
member.  Rebel leader, Surat Heseynov, was named prime
minister.  Elchibey was formally deposed by a referendum in
August 1993, and Heydar Aliyev was elected president in
October 1993 with only token opposition.
 
Under President Elchibey, freedom of speech, press, and
assembly generally were respected.  Newspapers, many of
which are affiliated with political parties, operated
without government restriction.  Since Aliyev came to power,
censorship of the press has become increasingly heavy-
handed, and there have been frequent crackdowns on
opposition groups, especially the APF.
 
State-of-emergency regulations in force since April 1993
severely limit travel to areas near the war front and
Iranian border.  All Azerbaijani citizens who wish to travel
abroad must first obtain exit visas or official passports
from the government.
 
Labor unions continue to be highly dependent on the
government.  Although the right to strike exists, wages  are
determined by relevant government ministries.
 
The court system remains unchanged from the Soviet period,
with district and municipal courts and a Supreme Court which
serves as a court of appeals.  The Ministry of National
Security has succeeded the Soviet KGB.
 
 While most Azerbaijanis are Muslims, there are significant
Russian Orthodox and Jewish communities.  Mosques which were
closed during the communist era have re-opened.  Armenian
churches remain closed, but there are no restrictions on the
free practice of religion.
 
In September 1992, President Elchibey issued an edict
calling for the preservation of the distinctiveness of
cultural, religious, and linguistic groups and promoting the
unrestricted exercise of national traditions and customs,
religious rites and ceremonies, and the preservation and use
of holy places.  Although the government has passed
legislation protecting the rights of minorities, it has had
difficulty guaranteeing the safety of the few remaining
Armenians in Baku.
 
The Nagorno-Karabakh Conflict.  The major domestic issue
affecting Azerbaijan is the dispute over Nagorno-Karabakh--a
predominantly Armenian enclave created in 1923 as an
autonomous province inside Azerbaijan.  The Armenian segment
of the province (about 75%), supported by Armenia, seeks
independence and separation from Azerbaijan.  Despite
ongoing international efforts to mediate a solution,
violence and bloodshed continue.
 
The current conflict began in early 1988 with a unilateral
declaration of independence by Nagorno-Karabakh and a
resolution by the Armenian parliament annexing the province.
In February 1988, demonstrations by Armenians in Nagorno-
Karabakh led to mob violence and to purges against other
Armenians resident in Azerbaijan.
 
In 1991, Soviet and Azerbaijani militia deported Armenians
from villages in Nagorno-Karabakh.  In September 1991, the
Armenians of Nagorno-Karabakh proclaimed an independent
republic.
 
Fighting in the region escalated in November 1991 after
several Azeri officials and Russian and Kazakh observers
died in a helicopter crash.  Azerbaijan accused Armenian
militants of shooting down the aircraft, imposed a state of
emergency, and abolished the area's autonomous status.
 
In December 1991, Nagorno-Karabakh's Armenian population
voted for independence.  By early 1992, ethnic Armenian
forces had overrun almost all of the Azeri settlements
there.  By May 1992, Armenians gained control of the entire
province and established a land corridor to Armenia.  In
1993, Nagorno-Karabakh Armenians increasingly carried the
conflict into other areas of Azerbaijan, seizing the
Kelbajar region in April, Agdam in July, and the entire
southwestern corner of Azerbaijan in August-October.  These
offensives have driven some 500,000 Azeri civilians from
their homes, in addition to some 150,000 Azeris displaced
from Nagorno-Karabakh, Lachin, and other areas affected by
the conflict.
 
Since 1988, Azerbaijan has blockaded Nagorno-Karabakh and
Armenia.   Armenian forces have destroyed Azeri settlements
within Nagorno-Karabakh and blockaded the Azerbaijani
enclave of Nakhchyvan, an autonomous republic separated from
the rest of Azerbaijan by Armenia.
 
In response to the deteriorating situation, UN Secretary
General Boutros-Ghali dispatched a fact-finding mission--
headed by former U.S. Secretary of State Cyrus Vance--in May
1992.  The mission concluded that a mediation effort under
the auspices of the CSCE was the best hope for bringing the
parties together.
 
In spring 1992, the CSCE created the Minsk Group (comprised
of Armenia, Azerbaijan, Russia, Turkey, the U.S., and six
European countries, plus representatives of the Armenian and
Azeri communities of Nagorno-Karabakh) to encourage a
peaceful, negotiated settlement to the conflict.  Frequent
outbreaks of new fighting initiated by both sides have
impeded progress.  On March 4, 1993, the Minsk Group reached
agreement on the terms of reference for a CSCE mission to
monitor a cease-fire.
 
In June 1993, all parties to the conflict accepted the Minsk
Group proposal to secure a cease-fire, a partial withdrawal
from occupied territory, deployment of international
monitors, the lifting of blockades, and the resumption of
negotiations.  Implementation of this proposal has been
delayed.
 
Some 400,000 ethnic Armenian residents of Azerbaijan who
fled the country during the 1988-90 pogroms, are refugees in
Armenia, Russia, and elsewhere.  During this period, nearly
200,000 Azeris fled Armenia.
 
Foreign Relations
Azerbaijan is a member of the United Nations, the Conference
on Security and Cooperation in Europe, and the North
Atlantic Cooperation Council.
 
Economic Outlook
Azerbaijan is moving cautiously toward a market economy.
State enterprises have not been privatized, but many small
private enterprises have sprung up, mostly in the retail
sector.  Progress toward economic reform has been impeded by
the conflict in Nagorno-Karabakh.  Azerbaijan seeks foreign
trade and investment and has passed laws to guarantee
against government expropriation.
 
Western oil companies believe that Azerbaijan contains one
of the largest undeveloped tracts of oil and gas reserves in
the world.  Several oil companies are negotiating with the
government on leases in the Caspian Sea.
 
Azerbaijan was the source of much of the machinery and
equipment used in the former Soviet oil industry.  Azeri oil
production represented 2% of the U.S.S.R. total in 1989, and
its natural gas production was 1% of the total.  Azerbaijan
is predominantly agricultural and has a lower percentage of
its population employed in industry than the other two
Transcaucasus republics (Georgia and Armenia).  The net
output of Azerbaijan represented only 1.7% of the U.S.S.R.
total in 1988.
 
Azerbaijan is a member of the International Monetary Fund,
the World Bank, and the European Bank for Reconstruction and
Development.  In 1992, it became a member of the Economic
Cooperation Organization--an economic bloc which includes
six Islamic states of the former U.S.S.R. and Afghanistan,
Iran, Pakistan, and Turkey.
 
Environmental Issues
One legacy of the former Soviet regime is a severe pollution
problem from the Caspian Sea petroleum and petrochemical
industries.  Clean-up has not yet begun.  Several
environmental organizations exist, and Azerbaijan has
expressed interest in scientific and technological exchange
in this field.  (###)
 
 
 
ARTICLE 6:
 
Fact Sheet:  Belarus
 
Belarus at a Glance
Belarus has been inhabited since prehistoric times, although
the first recorded settlements date back to the 6th century
AD.  The princes of Kiev ruled Belarus until the invasion of
the Mongols in 1240, when most of its towns were destroyed.
 
The region came under the control of powerful Lithuanians
and, later, under the Lithuanian-Polish Jagiellonian Dynasty
in 1386.  For centuries, the Poles and the Muscovites
struggled bitterly over Belarus.  In 1772, Catherine the
Great gained control over part of the country, and, by 1795,
Russia ruled all of Belarus.
 
During the 19th and 20th centuries, the country again became
a European battleground.  Napoleon passed through Belarus--
and fought there--in 1812, and the Germans fought the
Russians on Belarusian territory in World War I.   Although
a Soviet Socialist Republic was proclaimed in January 1919,
fighting with Poland continued until 1921.
 
Belarus suffered heavy losses in World War II but
experienced a great post-war rebirth. As part of the former
Soviet Union, it had a relatively highly developed
industrial base.  The population of Belarus is now about
10.3 million.  Belarusian is the official language; Russian
remains the predominant working language.
 
Principal Government Officials
Chairman of Parliament:  Mechislav Grib
Prime Minister:  Vyacheslav Kebich
Foreign Minister:  Petr Kravchanka
 
U.S.-Belarusian Relations
The dissolution of the Soviet Union in December 1991 brought
an end to the Cold War and created the opportunity  to build
bilateral relations with the New Independent States (NIS) as
they began a political and economic transformation.  The
United States opened an embassy in Belarus' capital, Minsk,
in February 1992.  The first U.S. Ambassador was David
Heywood Swartz, who assumed his post on August 25, 1992--the
first anniversary of Belarusian independence.
 
In January 1992, the U.S. initiated the Coordinating
Conference on Assistance to the New Independent States in
response to the humanitarian emergencies facing these
states.  The resulting Operation Provide Hope provided
desperately needed food, fuel, medicine, and shelter.
 
The cornerstone of the continuing  U.S. partnership with
Belarus and the other NIS has been the Freedom for Russia
and Emerging Eurasian democracies and Open Markets (FREEDOM)
Support Act, enacted in October 1992.  On September 30,
1993, a new $2.45-billion assistance package for the NIS,
funded with a combination of fiscal year (FY) 1994 and 1993
supplemental appropriations, was passed by Congress and
signed into law by President Clinton.  It will continue to
address Belarus' political and economic transformation and
humanitarian needs.
 
Through December 1993, the U.S. has provided about $140
million in humanitarian assistance and $8 million in
technical assistance to Belarus (not including nuclear
weapons dismantlement programs--see p. 262, "Military
Issues").  The focus of U.S. assistance to Belarus is the
provision of humanitarian assistance and support for its
transition to a market economy and transition to democracy.
 
The U.S. participated in the World Bank Consultative Group
meeting for Belarus held October 26-27, 1993.
 
Humanitarian Assistance.  Under Operation Provide Hope,
launched in February 1992, the U.S. provided 75 tons of
medicines and medical supplies valued at about $8 million to
Belarus.  Under the Medical Assistance Initiative,
administered by Project HOPE, a private voluntary agency,
the U.S. shipped $11.2 million in pharmaceuticals and
medical supplies to Minsk, Mahilyow, and Homyel'--the areas
most affected by the Chernobyl nuclear disaster.  The most
recent shipment was in December 1993.  Additional
commodities, including USAID's Emergency Medicines
Initiative and Department of Defense excess medicines and
supplies, complemented donated supplies delivered in April
and June 1993 for a total value of about $4 million.  In
January 1994, the U.S. began shipping the components of a
Department of Defense acute care hospital valued at $8
million to several Minsk hospitals.  A team of Americans
will assist with installation and training.  During FY 1992,
the U.S. Department of Agriculture (USDA) provided $24
million in concessional loans to purchase U.S. agricultural
products and about $15 million in commodities.  During FY
1993, under the Food for Progress program, USDA provided
corn valued at $19 million and about $20.4 million in other
commodities.  Belarus also received $5 million of both
soybean meal and feed wheat through the Food for Peace
program and Section 416(b) of the Agricultural Act,
respectively.  Citihope International distributed about
8,000 metric tons of USDA commodities.  An additional
agreement was signed on June 14, 1993, with Citihope for
distribution of 4,000 metric tons of Section 416(b) butter.
The Corporation To End World Hunger Foundation provided 120
tons of USDA soybean meal to orphanages in Minsk.
 
Assistance to Support the Transition to a Market Economy.
The establishment of a Western NIS Enterprise Fund was
announced by President Clinton in January 1994 to assist in
privatization in Ukraine, Moldova, and Belarus.  The U.S.
will provide $40 million for start-up of the fund in 1994.
 
U.S. advisers assist Belarus with agriculture and
agribusiness, issuance of government securities, financing,
energy efficiency, policy and pricing, tax administration,
telecommunications, labor statistics, epidemiology, and
hospital administration, management, and finance.
Representatives from Belarus have participated in training
and exchange programs on small business development,
entrepreneurship, market economics, agri-business,
environmental protection, debt, banking, tax administration,
and labor statistics.  A medical partnership has been
established between Pittsburgh Children's Hospital and three
Belarusian medical institutions in Minsk.
 
Assistance to Support the Transition to Democracy.  U.S.
advisers assisted Belarus with establishment of an executive
office; judicial restructuring and constitutional reform;
legislative research; pre-election assessment, election
administration, and voter registration and education;
leadership development; sports and community development;
and higher education.  Representatives from Belarus have
participated in training and exchange programs on rule of
law, non-proliferation policy, copyright legislation,
publishing support, independent media, university
administration, educational reform, teaching of English, and
academic exchanges.  Radio programming and publications also
have been provided.
 
Bilateral Trade Relations.  On February 16, 1993, a
bilateral trade treaty guaranteeing reciprocal most-favored-
nation status entered into force.  In January 1994, the U.S.
and Belarus signed a bilateral investment treaty, although
it is awaiting ratification by both countries before
entering into force.  Negotiations are continuing on a
treaty for the avoidance of double taxation.  An Overseas
Private Investment Corporation agreement was signed on June
24, 1992, and is in force.  Belarus is eligible for Export-
Import Bank short-term financing insurance for U.S.
investments.  Belarus welcomes joint ventures with American
companies.
 
Military Issues.  In Lisbon on May 23, 1992, the United
States signed a protocol to the Strategic Arms Reduction
Treaty (START) with Belarus, Russia, Kazakhstan, and Ukraine
(those states on whose territory strategic nuclear weapons
of the former Soviet Union are located).  The protocol makes
the four states party to the START Treaty and commits them
to reductions in strategic nuclear weapons within the 7-year
period provided for in the treaty.  On February 4, 1993, the
Supreme Soviet ratified the START Treaty and voted to adhere
to the nuclear Non-Proliferation Treaty (NPT) as a non-
nuclear weapons state.  Supreme Soviet Chairman Shushkevich
deposited Belarus' instrument of accession to the NPT with
President Clinton on July 22, 1993, at the White House.
 
The U.S. has signed six agreements with Belarus  to provide
more than $75 million in Nunn-Lugar assistance.  These
agreements would provide Belarus with nuclear accident
emergency response equipment, a government-to-government
communications link for transmission of START and INF
notifications, expanded military-to-military contacts and
assistance for defense conversion, environmental
restoration, and establishment of an effective export
control system.  On October 30, 1992, Belarus signed the
Conventional Armed Forces in Europe (CFE) Treaty to reduce
and numerically limit key categories of military equipment,
such as tanks, artillery, armored combat vehicles, combat
aircraft, and combat helicopters, and to provide for
destruction of weaponry in excess of those limits.
 
Political Conditions
Following Belarus' declaration of independence on August 25,
1991, most power passed to the Council of Ministers
(executive branch), whose decrees have the force of law.  A
new constitution came into effect on March 30, 1994.  It
establishes for the first time a presidency and a
constitutional court.  Presidential elections are scheduled
for June 23, 1994, and new legislative elections are
expected to take place before the end of 1994.
 
The Supreme Soviet (legislative branch) is technically the
highest branch of government.  It was chosen for a five-year
term under Soviet election rules in 1990.   Its chairman,
Mechislav Grib, is considered head of state until a
president is elected.  Grib was elected by the Supreme
Soviet to become its chairman on January 28, 1994, after his
predecessor, Stanislav Shushkevich, was removed in a vote of
no-confidence on January 26, 1994.  Both the Council of
Ministers and the Supreme Soviet are dominated by former
members of the Communist Party.
 
Belarus is making gradual progress in establishing a
democratic system.  The principal opposition party is the
nationalist organization, the Belarusian Popular Front.  On
February 4, 1993, the Supreme Soviet repealed an August 25,
1991, resolution temporarily suspending the activity of the
Communist Party.
 
Although freedom of the press is guaranteed by law, the
government has attempted to restrict unwanted criticism by
imposing fines and using charges of libel.  During 1992, the
government assisted several newspapers experiencing
financial problems associated with price reform, thereby
ensuring its right to pre-publication review.  Nearly all
radio and television stations are state-owned.  The Popular
Front has introduced legislation to restrict the government
from ownership of more than one newspaper.  Public
demonstrations are permitted, provided a permit is requested
10 days in advance.  Although citizens are free to travel
within the country, official permission is required for
foreign travel.  Belarusians must register their place of
residence and may not move without official permission.  The
Ministry of the Interior has proposed legislation abolishing
both regulations.
 
The right of workers to form and join independent trade
unions is governed by an April 1992 law.  In practice,
workers frequently are inducted into the government-
affiliated Federation of Trade Unions of Belarus.
 
In December 1992, the Supreme Soviet passed legislation
providing strong religious guarantees.  The majority of
Belarusians are Orthodox Christians, and the church has been
criticized by nationalists for its ties to the Russian
Orthodox Church.
 
Foreign Relations
Belarus actively is working to become a full member of the
international community.  Under an arrangement with the
former U.S.S.R., Belarus was an original member of the
United Nations. It also is a member of the Commonwealth of
Independent States (CIS), the Conference on Security and
Cooperation in Europe (CSCE), and the North Atlantic
Cooperation Council.
 
The government has supported CIS and CSCE efforts to resolve
regional disputes.  Minsk serves as the headquarters of the
CIS and is host to a peace conference on the conflict
surrounding the territory of Nagorno-Karabakh (a
predominantly ethnic Armenian enclave located in
Azerbaijan).
 
Economic Outlook
Belarusians face the difficult challenge of moving from a
state-run economy with high priority on military production
to a civilian, free-market system.  The government is
developing plans to privatize local and state enterprises
through a voucher system, but progress has been slow.  A
Council of Ministers' decree allows privatization to proceed
until the Supreme Soviet passes legislation.  The government
has continued to subsidize foodstuffs and other basic goods
to prevent social strife.  The economy remains dependent on
Russia for supplies and raw materials.  About 80% of
Belarusian products are exported there.
 
Economic activity in Belarus has stagnated, as businesses
await the outcome of talks on a monetary union with Russia.
Belarus seeks to join the Russian ruble zone in order to
stabilize its currency and boost its trade links with
Russia.  The rate of inflation in Belarus reached 40% in
February 1994 and is expected to climb to 50% in March.
Negotiations continue over an exchange rate between
Belarusian rubels and Russian rubles.  Agreement on a
monetary union could come later this spring.
 
The 1991 foreign investment law provides protection from
nationalization.  The country welcomes joint ventures with
American companies, particularly in computer software,
electrical components, telecommunications equipment, and
consumer goods.  However, rubel inconvertibility and other
restrictions, such as on land ownership, continue to hamper
investment opportunities.
 
Belarus has a broad industrial and agricultural base and a
high level of education.  Among the former republics of the
Soviet Union, it has one of the highest standards of living.
Leading employers are industry and construction (40%);
agriculture and forestry (22%); and health, science, and
education (16%).
 
Belarus is a member of the International Monetary Fund and
the World Bank.
 
Environmental Issues
Belarus has established ministries of energy, forestry, land
reclamation, and water resources and state committees to
deal with ecology and safety procedures in the nuclear power
industry. The most serious environmental issue in Belarus
results from the accident at the Chernobyl nuclear power
plant in 1986; about 70% of the nuclear fallout from the
plant fell on Belarusian territory.  The government is
receiving U.S. assistance in its efforts to deal with the
consequences of the radiation.
 
Belarus has long been a member of the UN Economic Commission
for Europe (ECE) and has been active in its environmental
meetings.  The country has signed key ECE conventions on
long-range transboundary environmental issues, but
implementation has suffered from a lack of resources.
(###)
 
 
 
ARTICLE 7:
 
Fact Sheet:  Moldova
 
Moldova at a Glance
Moldova is a landlocked area bounded by Ukraine on the east
and, to the west, Romania.   Because of its close ties to
Romania, Moldovan culture and language reflect the make-up
of its population:  Romanian and Russian are spoken, as well
as Ukrainian, Bulgarian, and Turkish (Gagauz).  With an area
of only 34,000 square kilometers (13,000 sq. mi.), Moldova
is the second smallest of the former Soviet republics and
the most densely populated.
 
A hilly plain, Moldova occupies most of what has been known
as Bessarabia.  About two-thirds of the republic's 4.4
million people are Moldovans with Ukrainian (14%), Russian
(13%), Bulgarian, and Jewish minorities.
 
Moldova's location has made it a historic passageway between
Asia and Southern Europe, as well as the victim of frequent
warfare.  Greeks, Romans, Huns, and Bulgars invaded the
area, which in the 13th century became part of the Mongol
empire.  An independent Moldovan state emerged briefly in
the 14th century but fell under Ottoman Turkish rule in the
16th century.
 
After the Russo-Turkish War of 1806-12, the eastern half of
Moldova (Bessarabia) between the Prut and the Dniester
Rivers was ceded to Russia, while Romanian Moldova (west of
the Prut) remained with the Turks.  Romania, which gained
independence in 1878, took control of the Russian half of
Moldova in 1918.  The Soviet Union never recognized the
seizure, creating an autonomous Moldovan republic on the
east side of the Dniester River in 1924.
 
In 1940, Romania was forced to cede eastern Moldova to the
U.S.S.R., which established the Moldavian Soviet Socialist
Republic.  Romania sought to regain it by joining with
Germany in the 1941 attack on the U.S.S.R.  Moldova was
ceded back to Moscow when hostilities between the U.S.S.R
and Romania ceased at the end of World War II.  The present
boundary between Moldova and Romania was established in
1947.  Moldova declared independence on August 27, 1991.
 
Principal Government Officials
President:  Leonid M. Kravchuk
Acting Prime Minister:  Yukhym Zvyahilskyy
Foreign Minister:  Anatoliy Zlenko
 
U.S.-Moldovan Relations
The dissolution of the Soviet Union in December 1991 brought
an end to the Cold War and created the opportunity to build
bilateral relations with the New Independent States (NIS) as
they began a political and economic transformation.  The
United States recognized the independence of Moldova on
December 25, 1991, and opened an embassy in the capital of
Chisinau in March 1992.  The U.S. Ambassador to Moldova,
Mary C. Pendleton, assumed the post on August 17, 1992.
 
In January 1992, the U.S. initiated the Coordinating
Conference on Assistance to the New Independent States in
response to the humanitarian emergencies facing these
states.  The resulting Operation Provide Hope provided
desperately needed food, fuel, medicine, and shelter.  The
cornerstone of the continuing U.S. partnership with Moldova
and the other NIS is the Freedom for Russia and Emerging
Eurasian Democracies and Open Markets (FREEDOM) Support Act,
enacted in October 1992.  On September 30, 1993, a new
$2.45-billion assistance package for the NIS, funded with a
combination of fiscal year (FY) 1994 and 1993 supplemental
appropriations, was passed by Congress and signed into law
by President Clinton.  Through December 1993, total U.S.
assistance to Moldova was about $68 million in humanitarian
assistance and $12 million in technical assistance.  The
focus of U.S. assistance is support for Moldova's transition
to a market economy and transition to democracy and the
provision of humanitarian assistance.
 
Humanitarian Assistance.  Operation Provide Hope, launched
in February 1992, has delivered food valued at about
$655,000 and medical supplies valued at $4.4 million to
Moldova.  An additional shipment of Department of Defense
excess medical supplies worth $8.1 million was delivered in
late August 1993.  Under the Medical Assistance Initiative,
administered by Project HOPE, a private voluntary
organization, $7.8 million in pharmaceuticals and medical
supplies have been delivered.  About $965,670 worth of
maternal and child health care medicines and supplies were
delivered under the Emergency Medicines Initiative.  Between
October 1993 and March 1994, a U.S.-Japan immunization
support program provided Moldova with vaccines, technical
assistance, syringes, and cold-chain equipment valued at $1
million.
 
In FY 1994, USDA is providing about 40,000 metric tons of
food aid, valued at $10 million.  In October 1993, the World
Bank agreed to loan Moldova $20 million to buy fuel oil and
coal.  The U.S. will provide $4.1 million in transportation
funds for this fuel.
 
Assistance To Support the Transition to a Market Economy.
The establishment of a Western NIS Enterprise Fund was
announced by President Clinton in January 1994.  It will
provide funds to assist privatization in Ukraine, Moldova,
and Belarus.  Training programs have been provided in market
economy, economic reform, entrepreneurship, small business
development, agricultural and agribusiness development,
labor management, international trade and investment, and
hospital administration, management, and finance.  Technical
assistance has been provided in the implementation of
privatization programs.  A medical partnership has been
established between Hennepin County Medical Center in
Minneapolis, Minnesota, and the City Ambulatory Center and
the Republican Hospital in Chisinau.
 
 Assistance To Support the Transition to Democracy.
Training and technical assistance programs have been
provided in law school curriculum reform, rule of law, law
enforcement, assessment of the draft Moldovan constitution,
municipal organization and staffing, political parties and
elections, independent media, pluralism, protection of
minority rights, and diplomacy and foreign policy.  Peace
Corps volunteers are working in Moldova with a focus on
teaching English.  Educational exchanges play an important
role in these areas.  Resident advisers have worked with the
executive and legislative branches of the Moldovan
Government.
 
Bilateral Trade Issues.  A trade agreement providing
reciprocal most-favored-nation tariff treatment became
effective on July 2, 1992.  An Overseas Private Investment
Corporation agreement, which will encourage U.S. private
investment by providing direct loans and loan guarantees,
was signed in June 1992.  A bilateral investment treaty was
signed in April 1993.  The Export-Import Bank has not begun
operations in Moldova.
 
Military Issues.  Moldova has accepted all relevant arms
control obligations of the former Soviet Union.  On October
30, 1992, Moldova ratified the Conventional Armed Forces in
Europe Treaty, which establishes comprehensive limits on key
categories of conventional military equipment and provides
for the destruction of weapons in excess of those limits.
It has not acceded to the provisions of the nuclear Non-
Proliferation Treaty but has expressed its intention to do
so.  It does not have nuclear, biological, or chemical
weapons.  Moldova joined the North Atlantic Treaty
Organization's Partnership for Peace on March 16, 1994.
 
Political Conditions
Moldova declared its independence from the former Soviet
Union on August 27, 1991.  Parliament elected  Mircea Snegur
to be president in October 1990.  A former Communist Party
official, he endorsed independence and actively sought
Western recognition.  However, Snegur's opposition to
immediate reunification with Romania led to a split with the
Moldovan Popular Front in October 1991 and to his decision
to run as an independent candidate in a December 1991
presidential election.  Running unopposed, he won after the
Popular Front's efforts to organize a voter boycott failed.
 
Moldova's transition to democracy has been impeded by an
ineffective parliament, the lack of a new constitution, and
continued unrest in the Trans-Dniester region where a
separatist movement, assisted by uniformed Russian military
forces in the region,  and led by supporters of the 1991
attempted coup in Moscow, has declared a "Dniester
republic."  The population of this ethnic area is 40%
Moldovan, 28% Ukrainian, and 23% Russian.  Moldova has
attempted to meet the Russian minority's demands by offering
the region limited cultural and political autonomy.
Although the dispute strained Moldova's relations with
Russia, on July 21, 1992, the government negotiated a cease-
fire arrangement with Russian and Trans-Dniestrian
officials.  The agreement established a tripartite peace-
keeping force comprised of Moldovan, Russian, and Trans-
Dniestrian units.  Negotiations to resolve the conflict
continue, and the cease-fire is still in effect.  The
Conference on Security and Cooperation in Europe (CSCE) also
is attempting to facilitate a negotiated settlement and has
sent an observer mission.
 
The ineffective parliament elected in 1990 to a five-year
term was replaced after new elections were held on February
27, 1994.  The election for the new parliament was conducted
peacefully and received good ratings from international
observers for its fairness.  Authorities in the Trans-
Dniester region, however,  refused to allow balloting there
and tried to discourage inhabitants from participating.
Inhabitants of the Gagauz separatist region did participate
in the elections.  The new parliament is considerably
smaller than the previous one, numbering only 104 deputies.
 
The largest political group in parliament is the Agrarian
Party, which holds a majority in the legislature with 56
seats.  The Socialist-Edinstvo Bloc won 28 seats, while the
pro-Romanian unification parties--the Peasants and
Intellectuals Bloc and the Popular Front--won 11 and 9
seats, respectively.  Several other parties did not receive
a sufficient percentage of the popular vote to be
represented in the new parliament.  Former speaker of
parliament, Petru Lucinschi, was re-elected as speaker on
March 29, 1994.  The previous Prime Minister, Andrei
Sangheli, was re-elected to his post on March 31, 1994.  The
government was restructured somewhat with parliament's
approval of a new cabinet on April 5, 1994.
 
Freedom of speech, press, assembly, and religion are widely
respected.  Political parties and other groups publish
newspapers which often criticize government policies.  An
independent news service, Basa Press, was established in
November 1992.  However, dependence on government subsidies
inhibits complete objectivity by the press.  There are no
independent broadcast media.  Peaceful assembly generally is
allowed.  Permits for demonstrations must be obtained, and
private organizations, including political parties, are
required to register with the government.  Legislation
passed in 1992 codified religious freedom but required that
religious groups be recognized by the government.
 
A 1990 Soviet law and a 1991 parliamentary decision
authorizing formation of social organizations provide for
independent trade unions.  However, the Federation of
Independent Trade Unions of Moldova, successor to the former
organizations of the Soviet trade union system, is the sole
structure.  It has attempted to influence government policy
in labor issues and has been critical of many economic
policies.  Moldovan labor law, which is  based on former
Soviet legislation, provides for collective bargaining
rights.
 
There have been increased tensions among the ethnic
minorities of the region due to civil unrest, but no serious
violations of human rights have been reported.  Language
policy is an increasing source of friction.  In August 1989,
the Supreme Soviet adopted legislation making Romanian the
official language and replacing the Cyrillic alphabet with
the Latin.  Although the law protects the use of Russian and
other languages,  it has raised much skepticism, especially
among Russian speakers.  A new constitution that will
provide a legal framework to protect minority rights is not
yet in place.  Although many former Soviet judges and chief
prosecutors were replaced in 1990 and 1991 during a
parliamentary review, an independent judiciary does not
exist.
 
Foreign Relations
Parliament approved Moldova's membership in the Commonwealth
of Independent States (CIS) and a CIS charter on economic
union on April 8, 1994.  Moldova is a member of the United
Nations, the CSCE, and the North Atlantic Cooperation
Council.  President Snegur signed the North Atlantic Treaty
Organization's Partnership for Peace agreement on March 16,
1994.
 
Moldova has worked with its neighbors, Romania, Ukraine, and
Russia, to seek a peaceful resolution to the conflict in the
Trans-Dniester region.  It has cooperated with CSCE and UN
fact-finding and observer missions and called for
international mediation.
 
Economic Outlook
Like many other former Soviet republics, Moldova has
experienced economic difficulties.  Since its economy is
highly dependent on the rest of the former Soviet Union for
energy and raw materials, the breakdown in trade has had a
serious effect, which was exacerbated by drought and civil
conflict.  Despite its difficult economic situation, Moldova
has made substantial progress in economic reform.  The
government has liberalized most prices and is phasing out
subsidies on basic consumer goods.  A privatization program
adopted in March 1993 aims to privatize about 35% of state
assets by the end of 1994.  Moldova has International
Monetary Fund standby and systemic transformation programs
in effect.  Moldova's economy resembles those of the Central
Asian republics more than those of the other states on the
western edge of the former Soviet Union.  Industry accounts
for only 20% of its labor force, and agriculture's share is
more than one-third.
 
Moldova's proximity to the Black Sea gives it a mild and
sunny climate, making the area ideal for agriculture.  Its
fertile soil supports wheat, corn, barley, tobacco, sugar
beets, and soybeans.  Beef and dairy cattle are raised, and
beekeeping and silkworm breeding are widespread.
 
Moldova's best-known product comes from its extensive and
well-developed vineyards, which are concentrated in the
central and southern regions.  In addition to world-class
wine, Moldova produces liquors and champagne and is known
for its sunflower seeds, prunes, and other fruits.
 
Moldova is a member of the International Monetary Fund, the
World Bank, and the European Bank for Reconstruction and
Development.  (###)
 
 
 
ARTICLE 8:
 
Fact Sheet:  Ukraine
 
Ukraine at a Glance
Ukraine's population traces its origins to the 9th century
Rus, a medieval civilization that introduced Orthodox
Christianity in 988 AD.  In 1392, the Grand Duke of
Lithuania seized the territory of Ukraine, and in 1569,
Lithuania merged with Poland.  Ukrainian peasants who fled
Polish efforts to force them into serfdom came to be known
as Cossacks and earned a reputation for a fierce fighting
spirit.  In 1667, Ukraine was partitioned between Poland and
Russia.   In 1793, it was reunited as part of the Russian
Empire.  Despite a proclamation of independence in 1917,
Ukraine was incorporated into the Soviet Union in December
1919.  Between the two World Wars, a nationalist movement
remained active and, unsuccessfully, attempted to restore an
independent republic after the German invasion in 1941.
During the war, Ukraine and its capital, Kiev, were heavily
damaged.  On August 24, 1991, Ukraine declared its
independence.
 
The territory of Ukraine is 233,080 square miles, slightly
larger than that of France.  It is primarily a vast plain
bounded by the Carpathian mountains in the southwest and by
the Black Sea and the Sea of Azov in the south.  The Dnieper
River has long been a trade route linking the Baltic coast
countries with the Black and the Mediterranean Seas.
 
According to 1991 estimates, the population of Ukraine was
52 million, about 18% of the population of the former Soviet
Union.
 
Principal Government Officials
President:  Leonid M. Kravchuk
Acting Prime Minister:  Yukhym Zvyahilskyy
Foreign Minister:  Anatoliy Zlenko
 
U.S.-Ukraine Relations
The dissolution of the Soviet Union in December 1991 brought
an end to the Cold War and created the opportunity to build
bilateral relations with the New Independent States (NIS) as
they began a political and economic transformation.  On
December 25, 1991, the United States officially recognized
the independence of Ukraine.  It upgraded its consulate in
the capital, Kiev, to embassy status on January 21, 1992.
The U.S. Ambassador to Ukraine is William Miller, who was
sworn in on October 13, 1993.
 
In January 1992, the U.S. initiated the Coordinating
Conference on Assistance to the New Independent States in
response to the humanitarian emergencies facing these
states.  The resulting Operation Provide Hope provided
desperately needed food, fuel, medicine, and shelter.
 
A cornerstone for the continuing U.S. partnership with
Ukraine and the other NIS has been the Freedom for Russia
and Emerging Eurasian Democracies and Open Markets (FREEDOM)
Support Act, enacted in October 1992.  In September 1993, a
new $2.45-billion assistance package for the NIS, funded
with a combination of Fiscal Year (FY) 1994 and 1993
supplemental appropriations, was passed by Congress and
signed into law by President Clinton.  The legislation
continues to address political and economic transformation
and humanitarian needs.
 
The U.S. encourages Ukraine's transition to a free,
democratic society and its efforts to develop free market
institutions.  Ukrainian President Leonid M. Kravchuk met
with senior government officials during his first official
visit to Washington, DC, May 5-7, 1992.  The U.S. and
Ukraine signed a series of agreements designed to enhance
economic, technical, environmental, and cultural
cooperation.
 
Secretary Christopher visited Ukraine in October 1993, and
President Clinton made a brief stop in January 1994, prior
to the January 14, 1994 signing of the Trilateral Statement
with Russia and Ukraine in Moscow.  President Kravchuk
visited Washington March 3-5, 1994.  During his visit, he
and President Clinton reached agreement on an expanded
economic assistance package that will provide up to $700
million to Ukraine:  $240 million will be in the form of
grant technical and humanitarian assistance; $60 million in
U.S. Department of Agriculture (USDA) concessional credits
and credit guarantees; and $50 million in Overseas Private
Investment Corporation (OPIC) insurance and financing.
Assistance related to economic reform will be contingent
upon Ukraine undertaking concrete measures necessary.  An
additional $350 million in Nunn-Lugar funds has been pledged
to assist with nuclear dismantlement, non-proliferation
programs, and defense conversion.
 
Through December 1993, the U.S. provided about $183 million
in humanitarian assistance and $95 million in technical
assistance to Ukraine, not including nuclear weapons
dismantlement programs--see p. 268, "Military Issues".  The
focus of U.S. assistance is support for Ukraine's transition
to a market economy and transition to democracy and the
provision of humanitarian assistance.
 
Assistance To Support the Transition to a Market Economy.
The establishment of a Western NIS Enterprise Fund was
announced by President Clinton in January 1994 to assist in
privatization in Ukraine, Moldova, and Belarus.  U.S.
advisers have provided technical assistance in small-scale
and municipal services privatization, public education,
corporatization, bankers training, financial sector reform,
tax policy and administration, land legislation, design of a
strategy to fight inflation, non-inflationary methods of
financing deficits, development of management training
curriculum for the manufacturing and industrial base,
agricultural development and agribusiness, and business
development.  Ukrainian representatives have participated in
U.S. programs on land and electric power privatization; coal
mine safety; energy efficiency; nuclear reactor safety;
private land ownership and real estate markets; local
government finance of urban developments; planning and land-
use practices; architectural restoration; democracy and the
market economy; economic development; banker training;
business education; tax administration; managerial
accounting; labor statistics; pro- motion of agricultural
development; telecommunications; labor management relations;
security and defense conversion; international trade and
investment; entrepreneurship and small business development,
public health; and hospital administration, management, and
finance.  Three medical partnerships have been established
between U.S. and Ukrainian medical institutions.  Peace
Corps volunteers are working in Ukraine with a focus on
small business development and English teaching.
 
Partial funding has been provided for studies in air-traffic
control and airport construction, establishment of an
agricultural center to provide training on U.S. agricultural
equipment, and the conversion of a coal-power plant to gas.
The U.S. also has provided grain storage facilities.
 
Assistance To Support the Transition to Democracy.
Ukrainian representatives have attended U.S. programs in
anti-monopoly regulation, rule of law, civilian control of
the police and American civil rights, administrative law and
the governmental process, regional security issues and U.S.
global perspectives, foreign policy, international
relations, military defense policy, congressional-military
relations, non-proliferation policy, American government,
public administration, independent media, minority
relations, diplomacy, and volunteer organizations.  U.S.
advisers have assisted in parliamentary legal reform and
constitutional law, condominium law, land privatization,
development of civilian oversight procedures for military
and national security affairs, political party training,
management of government finances, civil service, and
English teaching.  The U.S. provides funding to private
voluntary organizations to support the activities and to
strengthen the development of local non-governmental
organizations.  Funding for two university New Independent
States Linkage programs has been provided, and many students
and scholars have participated in higher education
exchanges.
 
Humanitarian Assistance.  The U.S. provided $25,000 in
response to the January 1994 flood disaster in Ukraine's
Zakarpatska oblast.  In October 1993, $25,000 was provided
in international disaster funding for the drilling of water
wells in the flood-stricken area of Rivne.  The U.S. has
provided funding for non-governmental organizations to
deliver surplus Department of Defense food and medicines, in
addition to providing transport for privately donated food,
medicines, medical supplies, and clothing.
 
Operation Provide Hope, launched in February 1992, has
delivered food worth about  $46,000 and medicines and
medical supplies worth $12.3 million.  A large portion of
these supplies was designated for hospitals treating victims
of the Chernobyl accident.  Under the Medical Assistance
Initiative, Project HOPE, a private voluntary organization,
has shipped more than $22 million worth of pharmaceuticals
and medical supplies to Ukraine.  In response to an epidemic
of diphtheria, the U.S. sent two assessment advisers from
the Centers for Disease Control, along with $1.3 million
worth of vaccines, syringes, and needles under the Emergency
Medicines Initiative.  Under the Emergency Immunization
Program, through Project HOPE, measles vaccine was provided
for all Ukrainian children up to 2 years of age during 1993.
In response to a 1994 request from the Ukrainian Government,
the U.S. will provide diphtheria vaccines for adults and
children to help Ukraine eradicate this deadly disease.  In
FY 1994, USDA expects to provide Ukraine with more than
70,000 metric tons of food aid, valued at about $24 million.
In addition, USDA has approved Ukraine for $40 million in
export credit guarantees (in two tranches) under the GSM-102
program for FY 1994.
 
Bilateral Trade Issues.  The U.S. and Ukraine concluded a
trade agreement, effective June 22, 1992, which provides
reciprocal most-favored-nation tariff treatment to the
products of each country and an agreement to authorize OPIC
to provide investment insurance, project financing, and a
variety of investor services to U.S. private investors in
Ukraine.  The  OPIC agreement entered into force May 6,
1992.  The Export-Import Bank is making available short-term
financing insurance for U.S. investments.  In March 1994,
Presidents Clinton and Kravchuk signed treaties on bilateral
investment and double taxation.
 
Military Issues.  In Lisbon on May 23, 1992, the United
States signed a protocol to the Strategic Arms Reduction
Treaty (START) with Ukraine, Russia, Belarus, and Kazakhstan
(those states on whose territory strategic nuclear weapons
of the former Soviet Union are located).  The protocol makes
the four states party to the START Treaty and commits all
signatories to reductions in strategic nuclear weapons
within the 7-year period provided for in the treaty.
Ukraine, Belarus, and Kazakhstan also agreed to join the
nuclear Non-Proliferation Treaty (NPT) as a non-nuclear
weapons state.
 
While Ukraine has not yet acceded to the NPT, its parliament
ratified the START Treaty and the Lisbon Protocol on
February 3, 1994.  On January 14, 1994, President Kravchuk
signed the Trilateral Statement and Annex with President
Clinton and President Yeltsin in Moscow, which provided for
the transfer of all nuclear weapons in Ukraine to Russia for
dismantlement.  The statement specified prompt compensation
by Russia to Ukraine for the highly enriched uranium in
nuclear weapons transferred to Russia; previewed security
assurances that the U.S., Russia, and the United Kingdom
(NPT co-depositories) will provide Ukraine on its accession
to the NPT as a non-nuclear weapons state; and reaffirmed
the U.S. commitment to assist the safe and secure
dismantlement of nuclear forces.
 
The U.S. has pledged to provide $350 million to Ukraine
under the Nunn-Lugar program to assist in the dismantlement
of strategic offensive arms, defense conversion, nuclear-
reactor safety and fissile material control, and accounting.
The U.S. also has pledged $10 million to assist in the
establishment of a Science and Technology Center designed to
provide peaceful employment opportunities to scientists and
engineers formerly involved with weapons of mass destruction
and their delivery systems.
 
On June 5, 1992, Ukraine and the seven other new independent
states with territory west of the Urals Mountains replaced
the Soviet Union in the Conventional Armed Forces in Europe
Treaty (CFE).  CFE  establishes limits on tank, artillery,
armored combat vehicle, combat aircraft, and attack
helicopter holdings in the treaty's Atlantic-to-the-Urals
zone, and provides for the destruction of weaponry in excess
of those limits.  On November 9, 1992, the treaty formally
entered into force.
 
Ukraine has hosted several on-site inspections of its forces
and met all CFE data and notification requirements in a
timely manner.  It is cooperating with the U.S. and the
International Atomic Energy Agency in efforts to limit
proliferation of weapons and technologies of mass
destruction.
 
Political Conditions
Ukraine declared independence in August 24, 1991.  Following
free elections held on December 1, 1991, Leonid M. Kravchuk,
former Chairman of the Ukrainian Supreme Soviet, was elected
president for a 5-year term.  At the same time, a referendum
on independence was approved by more than 90% of the voters.
 
The government continues efforts for economic recovery and
full democratization.  It is a parliamentary democracy with
separate executive, judicial, and legislative branches.  The
president nominates the prime minister and members of the
cabinet, who must be confirmed by the parliament.  The 450-
member parliament (Supreme Rada) initiates legislation,
ratifies international agreements, and approves the budget.
Its members were elected to five-year terms in 1990 and are
divided between conservatives from the former Communist
Party and a coalition of nationalists and reform-oriented
deputies.  The parliament has voted to hold new legislative
elections in March 1994 and presidential elections in June
1994.  Ukraine held the first round of early parliamentary
elections on March 27, 1994, with run-offs expected to be
completed by April 10, 1994.  Early presidential elections
are scheduled for June 26, 1994.
 
Political groupings in Ukraine include former communists,
Rukh nationalists, the Congress of National Democratic
Forces, "New Ukraine" (combining economic reformers and
environmentalists), and the Civic Congress, which supports a
federated structure and closer ties to Russia and within the
Commonwealth of Independent States (CIS).  The Communist
Party has reorganized as the Socialist Party of Ukraine.
 
Since becoming independent, Ukraine has named a
parliamentary commission to prepare a new constitution, has
adopted a multi-party system, and has adopted legislative
guarantees of civil and political rights for national
minorities.  New parliamentary elections were scheduled to
take place following ratification of the new constitution,
but criticism of the draft constitution's allocation of
presidential authority resulted in its being referred to the
Parliament's Constitutional Committee.  A coalition of
parties, including the Rukh and New Ukraine parties, failed
to obtain sufficient support for a referendum to force
parliamentary elections in early 1993.
 
In February 1992, at his request, the parliament granted the
president extraordinary powers to manage the implementation
of economic and administrative reforms by appointing
representatives to provincial and municipal governments.  In
November 1992, the parliament also granted extraordinary
powers to the prime minister until May 1993 to reform the
economy.  His economic decrees have the force of law unless
revoked by parliament within 10 days.  These powers were
returned to the president in May 1993.
 
Freedom of speech and press are not legally protected.  In
August 1992, President Kravchuk publicly warned that foreign
critics of the government, including journalists, could be
deported within two hours, although this threat has not been
enforced.  While no official censorship mechanism exists,
most newspapers receive state subsidies and are reluctant to
publish information critical of government policies.  State
radio and television are censored, and there are strict
regulations concerning the kind of material which can be
broadcast.
 
Legislation governing public assembly stipulates that
organizations must apply to the respective local
administration 10 days before a planned demonstration.  A
June 1992 law prohibits the state from financing  political
parties and other public organizations and restricts members
of the police and the armed forces and executive branch
officials from joining political parties.
 
Freedom of religion is guaranteed by law, although religious
organizations are required to register with local
authorities and with the government's Council of Religious
Affairs.  The dominant faiths are the Ukrainian Greek
Catholic Church and the Ukrainian Orthodox Church, which
retains its links to the Russian Orthodox Church.  The
Ukrainian Autocephalous Orthodox Church is nationalist
oriented and independent of Moscow.
 
Minority rights are respected in accordance with a November
1991 law guaranteeing ethnic minorities the right to schools
and cultural facilities and the use of national languages in
conducting personal business.  In the Crimea and eastern
Ukraine, areas with significant Russian minorities, Russian
is permitted as a language of official correspondence.  It
is recognized as an official language of Crimea.
 
Ethnic tensions in the Crimea during 1992 prompted a number
of pro-Russian political organizations to advocate secession
of Crimea and annexation to Russia.  In July 1992, the
Crimean and Ukrainian parliaments determined that in return
for political, cultural, and economic autonomy, Crimea would
remain under Ukrainian jurisdiction.
 
Crimea held its first presidential elections in January
1994, electing Yuriy Meshkov, a Republican Party of Crimea
member advocating closer ties to Russia.  The results of a
non-binding poll on March 27, 1994, demonstrated voters'
overwhelming support for greater powers for Meshkov, dual
Russian-Ukrainian citizenship for Crimeans, and a treaty to
govern relations between Crimea and Ukraine on a more equal
basis.
 
The court system follows the Soviet model with local or
people's courts, provincial courts, and a Supreme Court.
Parliament currently is reviewing the division of roles
between the Supreme Court and the Constitutional Court.
 
Ukraine maintains a Soviet law requiring citizens to
register with a "Visas and Registration Office" to obtain
employment or living quarters, although it is scarcely
enforced.  Exit visa requirements for foreign travel have
been eliminated for those holding Ukrainian passports.
 
Official trade unions have been grouped under the Federation
of Trade Unions.  A number of independent unions which
emerged during 1992 have formed the Consultative Council of
Free Trade Unions.  While the right to strike is legally
guaranteed, strikes based solely on political demands are
prohibited.  The National Mediation and Reconciliation
Service exists to regulate disputes between management and
labor not resolved at the enterprise level.  A new law on
trade unions is under consideration.
 
Security forces are controlled by the President, although
they are subject to investigation by a permanent
parliamentary commission.  Surveillance is permitted for
reasons of national security.
 
Ukraine has established its own  military forces of about
700,000 from the troops and equipment inherited from the
former Soviet Union.  It aims to reduce the force to between
250,000-300,000 by the end of the decade.
 
Foreign Relations
On December 8, 1991, Ukraine became a member of the
Commonwealth of Independent States (CIS).  However, in
January 1993, it refused to endorse a draft charter
strengthening political, economic, and defense ties among
CIS members.  Ukraine's relations with Russia have been
strained due to the continuing issue of the status of the
Crimea and disagreement over the transfer of nuclear
weapons.
 
Ukraine joined the United Nations  in 1945 as one of the
original members, following a compromise with the former
Soviet Union, which had asked for seats for all 15
republics.  On  January 31, 1992, Ukraine joined the
Conference on Security and Cooperation in Europe (CSCE), and
on March 10, 1992, it became a member of the North Atlantic
Cooperation Council.
 
Ukraine consistently has supported peaceful negotiated
settlements to disputes.  It has participated in the
quadripartite talks on the conflict in Moldova and has sent
a battalion to serve with UN peace-keeping forces in the
former Yugoslavia.  Through contacts with the countries of
the West, Ukraine seeks to increase consultation and
cooperation in areas such as defense planning; the
conversion of defense production to civilian purposes; and
scientific, economic, and environmental issues.
 
Economic Outlook
The Ukrainian economy continues to deteriorate, with its
decline recently accelerating.  Price increases for energy
supplies from Russia and irresponsible credit policies by
the government have led to hyperinflation.  Production
continues to drop, with overall GDP falling by 20% in 1993.
The financial system is in disarray.  The Ukrainian coupon
exchange rate, 900 to the dollar in February 1993, dropped
to less than 35,000 to the dollar in 1994.  Pressured by the
industrialist-faction led by former Prime Minister Kuchma,
on February 21, 1994, the Kravchuk Government continued a
pattern set in 1993 and announced  massive new subsidies
worth more than $300 million to the agricultural and
industrial sectors.  These will deepen the state budget
deficit and ensure that inflation will continue at current
high levels in the near term.
 
The vast majority of Ukrainian trade is with countries of
the former Soviet Union, and principally with Russia.
Demand for Ukraine's non-agricultural exports--ferrous
metals, steel pipe, machinery, and transport equipment--
continues to fall.  Forced to pay high prices for fuel,
Ukraine continues to run large, unsustainable trade
deficits.  Ukraine's trade deficit with Russia was more than
$1.5 billion in 1993.
 
Ukraine's dependence on Russian fuel supplies has crippled
its economy.  Ukraine imports 90% of its oil and most of its
natural gas from Russia.  During 1993, Russia raised fuel
prices (although still significantly below world-market
prices) and reduced deliveries to one-half 1992 levels.
Ukrainian authorities have been forced to cut supplies to
industrial enterprises by 40%, reduce transport services by
one-third, and use rolling brownouts in major cities to
preserve supplies.
 
In January 1994, the parliament passed an ambitious
privatization law which envisions transferring one-quarter
of the state enterprises into private hands by the end of
1994.  The government aims to negotiate a stabilization
program with the International Monetary Fund which could
serve as the basis for a comprehensive reform effort.
 
 Ukraine encourages foreign trade and investment.  The
parliament has approved a foreign investment law allowing
Westerners to purchase businesses and property, to
repatriate revenue and profits, and to receive compensation
in the event that property is nationalized by a future
government.  An agreement to provide relief from double
taxation is being negotiated.
 
Ukraine is rich in natural resources.  It has a major
ferrous metal industry, producing cast iron, steel, and
steel pipe.  Its chemical industry produces coke, mineral
fertilizers, and sulfuric acid.  Its manufactured goods
include metallurgical equipment, diesel locomotives, and
tractors.
 
It also is an important agricultural and industrial region.
It is a major producer of grain and sugar and possesses a
broad industrial base, including much of the former
U.S.S.R's space industry.  Although oil reserves are largely
exhausted, it has important energy sources, such as coal and
natural gas, and large mineral deposits.
 
On April 27, 1992, Ukraine became a member of the
International Monetary Fund and the World Bank.  It is a
member of the European Bank for Reconstruction and
Development.
 
Environmental Issues
Ukraine has significant environmental problems resulting
from the Chernobyl nuclear power plant disaster in 1986 and
from industrial pollution.  The government has established a
Ministry of Environment and has introduced a pollution fee
system by which taxes are levied on air and water emissions
and solid waste disposal, with the resulting revenues
channeled to environmental protection activities.  However,
enforcement of this pollution fee system is lax.  Ukraine is
interested in cooperating on regional environmental issues.
Conservation of natural resources is a high priority.  It
established its first nature preserve, Askanyia-Nova, in
1921 and has a program to breed endangered species.  (###)
 
 
END OF DISPATCH VOL.5, NO 18

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