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U.S. Department of State
96/11/23 Press briefing with Sec. Kantor & Amb. Barshefsky, Manila
Office of the Spokesman



                    U.S. DEPARTMENT OF STATE 
                     Office of the Spokesman

                      (Manila, Philippines)

_________________________________________________________________
For Immediate Release                           November 23, 1996

                    JOINT PRESS AVAILABILITY
                             with
       U.S. SECRETARY OF STATE WARREN CHRISTOPHER
        U.S. SECRETARY OF COMMERCE MICKEY KANTOR
                             and
             AMBASSADOR CHARLENE BARSHEFSKY


                            PICC
                   Manila, Philippines
                    November 23, 1996



SECRETARY CHRISTOPHER:  Good afternoon.  About an hour ago, we concluded 
a very successful APEC Ministerial Meeting.  I believe that here in 
Manila, we have prepared a new and important phase in APEC's evolution 
that our leaders will launch when they meet on Monday in Subic Bay.  
When President Clinton first brought the APEC leaders together at Blake 
Island, some three years ago, they embraced a far-reaching vision of 
economic cooperation in the Asia Pacific region.  Two years ago in 
Bogor, our leaders committed to reach a common goal of free trade and 
investment by 2010 and 2020 in the 18 diverse APEC economies.  Last year 
in Osaka, we agreed upon an Action Plan and, now, here in Manila, we've 
agreed to take specific steps that each of our member nations and 
economies will take to carry out the original vision looking all the way 
back three years to Blake Island.  The APEC economies have each agreed 
take a series of steps that represent the first installment toward 
meeting our fundamental 2010 and 2020 commitments.  

Over the next several years, our Individual Action Plans will produce 
important openings in each APEC economy -- openings that will mean new 
opportunities for new investment, trade, growth and jobs.  We've also 
agreed to sharpen the focus of APEC's significant agenda of economic and 
technical cooperation.  We'll concentrate our efforts in six core areas:  
human resources, capital markets, infrastructure, technology, the 
environment, and small and medium enterprises.  In each area, we will 
work toward concrete outcomes by a fixed deadline.  And, in connection 
with this, we'll enlist the advice and technical support of the private 
sector to ensure that our work makes a direct and positive impact on the 
APEC business environment.  

In this connection, let me say that President Ramos had made a very 
significant contribution by emphasizing that APEC means business.  Since 
the very beginning of my own involvement in the APEC process, I've 
stressed that the critical test of APEC's success is whether it has a 
practical relevance to the private sector.  I believe this message is 
certainly getting through the business communities, and we're beginning 
to see the concrete benefits of our work to knock down barriers and to 
promote liberalization throughout the Asia-Pacific region.

Over the last three years, APEC has emerged as a strong force for global 
as well as regional liberalization.  That's why the consensus of the 
APEC ministers reached on the Information Technology Agreement today is 
at such an important one.  Yesterday, I believe many of you were there 
when we witnessed the power of technology to bring us together when we 
participated in the launch of EduNet, an interactive medium that brought 
home the importance of information technology to regional cooperation.  
Concluding an Information Technology Agreement is a top priority that 
the United States shares with many of its trading partners and my 
colleague, Ambassador Barshefsky, has been working very hard to achieve 
this.  

What happened today at APEC is another achievement by her and, in a 
moment, I'll ask her to report to all of you where we stand, what the 
agreement at APEC means, how it will be significant as we move into 
Singapore.   

Let me conclude by observing that the value of these APEC meetings is 
even greater than the specific steps that the member economies agreed to 
take.  These meetings afford an opportunity for our foreign ministers 
and trade ministers to come together to exchange views, to forge a new 
consensus on various issues, and to move forward as we shape the Pacific 
community and draw all of our economies closer together.  President 
Clinton will build on our work in his meeting with the other APEC 
leaders here in Manila tomorrow and in Subic Bay on Monday.

Now with that opening statement, please let me turn to Ambassador 
Barshefsky and then Secretary Kantor.

AMBASSADOR BARSHEFSKY:  Thank you very much.  The endorsement today by 
APEC member economies of working to conclude an ITA by Singapore -- and 
may I say that this was not merely consensus, this was unanimity among 
the APEC member economies -- is an extremely important step.  This 
unanimity was our primary objective with respect to the trade portions 
of the Ministerial and I believe that the clear intention of the 
Ministerial declaration will provide a very significant boost to on-
going negotiations in Geneva with respect to the ITA.  We, that is the 
United States, have identified the ITA as a priority for this APEC 
meeting because of its significance to the APEC member economies which 
comprise about 80 percent of global trade in ITA products.  ITA 
production worldwide in 1995 was a trillion dollars.  Exports in 
international trade in IT products was, in 1995, a half a trillion 
dollars, and APEC represents about 80 percent of that global trade.  
This is one reason why unanimity ultimately was achieved.  The interest 
of the APEC member economies in free and open trade in this sector is 
quite clear.

Let me say also that this is a sector that is growing at an astonishing 
rate.  In 1990, global trade was about $350 billion in IT products.  In 
1995, it was a half a trillion.  By the year 2000, 800 billion.  This 
rapid growth exceeds the rate of growth in any other sector in any of 
our member economies.  So, this is clearly an important area for APEC 
and the unanimity reached today with respect to APEC desire that these 
negotiations come to successful conclusion by Singapore attest to the 
importance of this sector to each of our economies and to global growth 
in general.

Let me also say that we achieved, I think, important results with 
respect to the Individual Action Plans by APEC members as well as with 
respect to the Collective Action Plans.  With respect to the Individual 
Action Plans, of particular interest to the United States is a very 
excellent offer by Indonesia to further reduce its tariffs, on an MFN 
basis, particularly in sectors of substantial interest to the United 
States -- for example, scientific equipment, pulp and paper products, 
and automotive parts.  The tariff reductions that Indonesia has put 
forward in its Individual Action Plan are very significant --about a 60 
percent reduction on the average shortly after the turn of the century.  
So, we applaud that plan as well as many of the individual items in many 
of the other plans. 

On the collective action side, among the most dramatic is expanded 
Internet access to various customs and other tariff data bases which we 
were treated to a demonstration of at a Ministerial lunch.  It is 
anticipated that having these broad-based regional data bases on the 
Internet will help businesses cut transaction costs and time by a 
significant amount, enhancing the commercial relations among the members 
and enhancing the profitability of businesses dealing within the APEC 
region.

So, we're very pleased with the outcome of this Ministerial and may I 
also say that we applaud the leadership demonstrated by the Philippines 
and by President Ramos in helping the Ministers bring this session of 
APEC to such a successful conclusion.  And with that, may I introduce 
Secretary Kantor.

SECRETARY KANTOR:  Thank you, Ambassador Barshefsky.  Of all my 
introductions that was the shortest, but the most welcome.  Thank you, 
Secretary Christopher.

I would just like to put this very quickly into some context here.  The 
President's first trip as President, of course, was to Japan, to this 
region.  His first trip as President-elect is to this region.  And with 
good reason.  What we're talking about, of course, the most dynamic 
economies on earth.  When you combine the U.S.-Canada-Mexico-Chile with 
our other 14 partners in Asia, what we have is the most dynamic 
economies on earth, representing well over two billion people, $16 
trillion in income a year, 50 percent of the world's GDP and, 50 percent 
of the world's trade.  

So, it is of necessity that we're here in a modern world where it's 
globalized and interdependent and economic security clearly has become 
inextricably entwined with national security interests, and where growth 
and prosperity are foundations for stability and security, they must be 
mutually assured, and where the opportunities that we are presented with 
could only be achieved by corresponding responsibility.  And what you 
see is, through the leadership of Secretary Christopher and Ambassador 
Barshefsky, working under the President's direction, we've been able to 
take the next giant step.  

If you remember when we were in Seattle where the President called the 
Leaders together in a vision at Blake Island, when we established the 
goals of Bogor, then the Action Plan at Osaka, and now we find ourselves 
in Manila with these action plans, both collective and individual, and 
trade facilitation measures, and business being inextricably involved, 
intimately involved in what we're doing, I think you can see great 
progress has been made.  Sometimes, we're somewhat cynical about what's 
been achieved.  The fact is that, if you look back, there's been 
tremendous progress made by APEC, and I believe it has a very bright and 
prosperous future for all of us.

QUESTION: I have a question for the Secretary.  Foreign Minister Qian 
seemed to say a few minutes ago that there was no foundation in the 
allegations in American newspapers about proliferation of Chinese 
weapons to Iran and I suppose, to Syria and Pakistan.  We remember that 
a few days ago in China he said to you, I think, that they had kept 
their promises of 1994.  Is that the American position or are you a bit 
worried about the sales of Chinese weapons abroad?

SECRETARY CHRISTOPHER:  Well, the foundation of the question to Vice 
Premier and Foreign Minister Qian Qichen was newspaper reports 
purporting to stem from intelligence agency materials.  I don't want to 
be in a position in any way of commenting or giving any basis to those 
intelligence reports.  I don't have to say over again that we don't 
comment on those intelligence matters.

When I met with the Foreign Minister, I spoke as we so often do about 
our concern about military sales to rogue nations -- sales of products 
that might aid in the development of weapons of mass destruction.  
There's no secret that the United States is very concerned, particularly 
about sales to Iran because of its reputation in the field of promoting 
terror and trying to assemble weapons of mass destruction.  We urged the 
Chinese not to be involved in that kind of trade, and they indicated 
that they were faithfully complying with the 1994 missile agreement as 
well as other commitments on their part.  What I would say is that we're 
following this matter with great care and very closely because of the 
importance that we attach to it.

QUESTION: How can you ensure that the were adhering to their promises?

SECRETARY CHRISTOPHER:  Let me just say again that we're following very 
closely and with great intensity information that we might develop on 
this subject.  Our obligation is to try to ensure that our information 
is up to date on the subject, and we will certainly bring it to their 
attention as we develop information that might be inconsistent with 
their prior commitment.

QUESTION:  As we know, at the last minute, you changed the title of your 
speech delivered at the Shanghai Fudan University by using the word 
"cooperation" instead of the word "partnership."  Why was the revision 
made at the end of your trip?  What's the implication for tomorrow's 
summit meeting between Jiang and Clinton?  How do you sum up your trip 
to China?  What expectations do you have on tomorrow's summit meeting?

SECRETARY CHRISTOPHER:  I sum up my trip to China by saying that I think 
it was an excellent trip and I think it moved the relationship between 
the United States and China substantially forward.  China is a very 
important country to the United States and to the world.  We've 
emphasized the importance of an intensive dialogue with China.  We 
certainly had over my two days in China a very intensive dialogue, seven 
hours with the three top leaders in Beijing in which we covered very 
intensively proliferation issues, trade issues, and human rights issues 
at very considerable length.  Coming out of these meetings, we look 
forward to the meeting tomorrow between the President of China and the 
President of the United States.  In a sense, our meetings were 
preparatory to those meetings.  

As I said in Beijing and emphasized here again today, confrontation and 
containment is not the direction the United States is going with respect 
to China.  We think that would be self-defeating for the United States 
and for the world as a whole.  We want to emphasize the importance of 
cooperation and working closely together on the many issues in which we 
have common interest and finding ways to manage those issues on which we 
have differences.

QUESTION:  This is for Ambassador Barshefsky, if I may.  The Malaysian 
minister, Mrs. Rafidah, said in the collective press conference that 
there really was no agreement on information technology, that there was 
a consensus to keep working toward the Singapore meeting, which is what 
the text says.  And if I understood you properly, you said there was not 
only an agreement, but unanimous agreement.  I just want to make sure I 
understand what we've agreed or not agreed.  Thank you.

AMBASSADOR BARSHEFSKY:  Yes, Minister Rafidah.  We are all on the same 
wavelength, so, let me be clear in what I said.  We have agreed, 
unanimously agreed, among the APEC members that we should work in the 
WTO, which is where, you know, the negotiations reside to conclude an 
ITA by Singapore.  And we have challenged all of the other WTO members 
to come forward and work with us toward that end.  That is the agreement 
here and this is a significant agreement because it is the first time 
APEC has taken a stand on a WTO-related negotiation and has called not 
only for successful conclusion of it, but within a time certain and that 
is by, or perhaps at, Singapore.  

Now, as to the bounds of the agreement -- that is to say what the 
product coverage is, and the staging for tariff phase-outs -- this is 
all being negotiated in Geneva, as you know.  And indeed, those 
negotiations have gone on the entire week we've been here.  We, that is, 
the United States, were quite insistent, not only here but at the 
Christchurch Trade Ministerial, that we not have two negotiating fora 
for the ITA; that the negotiations should be in Geneva, not only where 
the experts are with respect to the products and the staging of tariff 
elimination and so on, but also because the EU is not a member of APEC.  

From the point of view of the United States -- because in the first 
instance, the ITA concept was brought to the EU and the U.S. by our 
respective domestic industries at the Trans-Atlantic Business Dialogue 
which Ambassador Kantor chaired -- we felt committed to ensure that 
Europe would also be involved at every stage in the negotiation.  For 
that reason, both at Christchurch and here, we were quite insistent that 
the particular products -- staging and so on -- be negotiated in Geneva 
where the EU could also participate in those negotiations simultaneously 
with the United States.

QUESTION:  Can I just follow up just very quickly?  Since China is a 
member of APEC, but not a member of the WTO, does it have an opinion and 
does this opinion matter in this case?

AMBASSADOR BARSHEFSKY:  Well, the Chinese of course have a view, as do 
the rest of the APEC economies.  The ability to export information 
technology products without, in effect, taxing that export -- which is 
exactly what tariffs are, they are tax on the export -- is very much in 
China's own interest.  And this was a view expressed by Madam Wu in the 
course of the Ministerial.  So they do have a view and it is a view that 
seems to be consistent with that of the other APEC members.

QUESTION:  This is a question for Ms. Barshefsky.  There's been talk 
that China is more willing to make concessions in order to gain earlier 
entry to the WTO.  Could you brief us on the progress of these talks?

AMBASSADOR BARSHEFSKY:  Well, of course, Secretary Christopher recently 
had meetings with Minister Qian as you know, and both Secretary Kantor 
and I have had a number of occasions to meet recently with Minister Wu.  
The United States has consistently taken the view and expressed a view 
to China that we welcome China's admission into the WTO.  We believe 
that is important for the United States.  We believe it's important for 
China.  And we believe it's also important to the multilateral system.  
But we have also consistently said that China must enter on terms 
consistent with the other 124 members and member economies of the WTO; 
that is to say, adherence to WTO rules and significant market access and 
market opening commitments.  We look forward to working with China on 
both of those matters; that is, rules and market access.  Our meetings 
with the Chinese have been quite constructive in that regard.  But there 
is, of course, a very long way to go in these negotiations, as you know.  
And we will be pleased to work with China on it.  

QUESTION:  I'd like to return to the ITA, if I may.  Just a little more 
precision.  Mrs. Rafidah made it clear this morning that she was not 
really interested in an ITA which required members of the WTO to abolish 
old tariffs by the year 2000.  My question is, would an agreement that 
did not commit the contracting parties to that 2000 date and zero 
tariffs be acceptable to United States?

AMBASSADOR BARSHEFSKY:  First of all, I'm not sure you and I heard the 
same Rafidah.  As she pointed out, Malaysia has in fact gone to zero in 
a number of areas with respect to information technology products.  She 
pointed to telecommunications, where 60 percent of their tariffs are at 
zero.  In addition, as you know, she disputed the statement attributed 
to her that she was not in favor of an ITA and, instead, indicated that 
this was absolutely not the case.  And she indicated that at the 
Ministerial.

I certainly would not negotiate the bounds of the ITA in the press. The 
Quad position has been quite clear.  We would like to see tariffs cuts 
begin in 1997.  We would like to see tariffs on ITA products go to zero 
in the year 2000.  We have said further in Geneva repeatedly that if 
there are particular areas of difficulty, especially among developing 
countries, we -- that is the Quad -- would look at those areas, provided 
they tended to be the exception and not the rule.  But, as to the 
specific bounds ultimately of the ITA with respect to the product 
coverage or staging, we deal with that in Geneva with our Quad partners 
and WTO partners.

QUESTION:  Also on the ITA.  I'm not sure we've been hearing the same 
U.S. officials, because in the weeks running up to APEC, the explicit 
backing the U.S. official I spoke to was a very explicit backing for 
zero tariffs by 2000.  And that seems to have completely fallen off the 
table.

AMBASSADOR BARSHEFSKY:  I don't know who you spoke to, but the United 
States has never proposed for this meeting zero tariffs by the year 
2000.  What the United States has consistently sought from APEC is the 
political will to conclude an agreement by Singapore.  That is the 
commitment needed.  As to zero tariffs in the year 2000, staging and all 
of that, that's all going to be taken care of in Geneva by all of our 
respective negotiators, none of whom are at APEC because they have 
entirely different portfolios.  But what the United States sought from 
APEC since Christchurch for so many months now was the political will 
unequivocally to move forward and reach agreement at Singapore.  And 
that is what was achieved.

QUESTION:  This is not a new subject, but "Inside U.S. Trade" this week 
is reporting that once again the U.S. is now looking more closely at 
dropping the remaining 1989 sanctions imposed on China.  Is this 
feasible now? Is this an integral part of the U.S. policy of 
comprehensive engagements, of improving relations?  Could this be agreed 
soon?

SECRETARY CHRISTOPHER:  We would like to reach the point where we felt 
that there was justification to dropping the 1989 sanctions.  We're not 
there yet.  We will continue to review the matter.

I see there are a number of people lined up.  I don't want to prolong 
the matter, but one of the matters I do want to emphasize is that, in 
many ways, the Ministerial Meeting was preparatory to the Leaders 
Meeting and we look to the Leaders and their meetings at Subic on Monday 
to provide the ultimate political will to accomplish the things that the 
Ministers recommended to them or took action on over the last 48 hours.  
It is very important that the press all understand that the key to this 
APEC Meeting will reside ultimately in Subic Bay meeting on Monday.

QUESTION:  Secretary Christopher, Hong Kong is currently in the process 
of seeing its directly elected legislature scrapped to make way for an 
appointed one with Beijing's supervision.  The Chief Executive more or 
less is being selected in a similar manner.  With this in mind, how do 
you view the state of freedom and democracy in Hong Kong?  And will how 
Beijing handles Hong Kong significantly affect U.S.-Sino relations?

SECRETARY CHRISTOPHER:  We've emphasized to China many times -- and most 
recently I did this week -- that we expect Hong Kong to be treated by 
China consistent with the agreement between China and the United 
Kingdom.  We are following the matter very closely.  Our citizens, I 
think, are very interested as are the citizens all around the world, in 
the commitment of China to maintain a rule of law there, to maintain the 
market democracy, and the other freedoms that have been so crucial to 
Hong Kong's development as a really quite fantastic economic unit.  I 
think that maintenance of those freedoms is essential.  We are watching, 
as well as the world, as this unfolds over the next eight months.

QUESTION:  For Ambassador Barshefsky again.  Excuse me for coming back 
once more to a similar question on the ITA.  But you mentioned that 
unanimity was United States' primary objective.  I'm wondering if you 
also had secondary objective in the statement today.  For instance, 
perhaps a mention of the year 2000 or a mention of the concept of zero 
tariffs.  And I think part of where some of uncertainty comes from is 
from briefings like the one Ambassador Lord gave in Washington on 
November 14 where he mentioned the action plans.  And there he's saying 
the single biggest concrete goal we have now, in addition to that, will 
be to try get APEC to endorse an Information Technology Agreement which 
will eliminate all tariffs in this critical sector by the year 2000.  So 
I think some of us were expecting that to be in the statement today.

AMBASSADOR BARSHEFSKY:  It isn't anything that I expected or sought.  I 
think, if I may -- and I wasn't there at the Ambassador Lord's briefing 
-- I think he is describing what the ITA is.  There is certainly a 
general understanding within APEC as to what the ITA is.  But the single 
most important thing is to keep the momentum driving toward the 
Singapore meeting.  We might agree here on parameters for an ITA, but if 
there is not momentum to move forward by a time certain, having agreed 
on the parameters is hardly relevant.  

So the issue for us here was to ensure that very strong progress would 
be made in committing to a time certain for the ITA's completion.  
That's number one.  Number two, it was very important for APEC in effect 
to challenge other WTO members, including the EU, to join us in fact in 
concluding the ITA by Singapore.  This is a very complicated 
undertaking.  It is a massive task.  It is also highly technical.  Even 
if we looked at the Quad countries, there are disagreements as to 
product coverage and scope.  There are disagreements as to staging.  
This is among the foremost developed regions or countries in the world.  
So this is quite complicated.  And, from the APEC point of view, the 
impetus, the desire to conclude an Information Technology Agreement is 
what is most important at this juncture, as well as the challenge to 
other WTO members to come forward and work with us toward that end.

QUESTION: (inaudible)

AMBASSADOR BARSHEFSKY:  This has to do with the Geneva negotiations, 
which predicated on the notion of zero in 2000, recognizing countries 
may have some specific difficulties with that; recognizing there are 
some Quad countries that may have some specific, targeted difficulties 
with that.  The overall parameter of the ITA -- that is, that its 
product coverage should be broad and very detailed and that there should 
be a time certain for tariff elimination -- is broadly understood.

QUESTION:  Let me try this one more time, unfortunately.  Did the U.S. 
delegation here ever try to have inserted in the Ministerial statement 
the language of a goal of the year 2000 for the elimination of all 
tariffs on information technology?

AMBASSADOR BARSHEFSKY:  No.  Never at any time.  Not between 
Christchurch, New Zealand, when this issue was first discussed in APEC, 
and at this very moment, when the same question has been asked.  No.  
That is not what we needed at APEC.

QUESTION:  My question for Secretary Christopher -- you will be relieved 
to know -- is about South Korea. (Laughter.)  What do you expect and 
hope from the bilateral with South Korea tomorrow, both in general and 
on two subjects in particular:  First of all, the apology for the 
submarine incursion which South Korea is demanding and the North appears 
so far reluctant to give?  And secondly, the Geneva Framework and the 
time of its implementation?

SECRETARY CHRISTOPHER:  Let me say that we're working very closely with 
the South Korean government on these matters.  I met with the new 
Foreign Minister, Mr. Yu.  And I think we developed a very good 
relationship on these issues.  We happened to sit together last night at 
dinner, so we had a good opportunity to extend our discussion, and I 
think there's a high degree of convergence between the United States and 
South Korean positions at the present time.

We regard the submarine incident as being a highly provocative incident.  
One that certainly required firm action on behalf of both South Korea 
and the United States in terms of denouncing it as a very troublesome, 
very provocative incident.  In that connection, the United States 
continues to believe that the North Koreans should make a gesture that 
indicates that they have a similar assessment of the seriousness of that 
action on their part.

There is between the United States and South Korea a total convergence 
of views that the Framework Agreement is important and we should do our 
part in complying with the various elements of that very technical 
complex agreement, as North Korea must.  We are also fully agreed on the 
importance of four-party talks.  Those will be the subjects of the 
discussions between the President of the Republic of Korea,  President 
Kim, and President Clinton when they meet tomorrow, based upon the good 
discussions that I had with the new Foreign Minister, Yu.

QUESTION:  Could I have a quick clarification?  Very briefly: You speak 
of a gesture indicating North Korea shares your view.  The South appears 
to want something detailed, in particular a letter directed at them 
expressing an apology.  Is the gesture a letter, or is it your view that 
something less than that will be adequate?

SECRETARY CHRISTOPHER:  I don't think it serves any valuable purpose 
here to get bogged down in the semantics of this particular issue.  
What's important is that there be a gesture, an indication that the 
North Koreans recognize the seriousness of what has happened there.  I 
don't want to prescribe a particular modality, but I think the result 
must be the one that I mentioned.  We've had a lot of experience with 
this particular system and it doesn't, I think, serve the purpose of 
peace and stability in this region to try to define in advance in a 
public forum like this precisely what would and would not be acceptable.  
But there has to be recognition, by a gesture of some kind, of the 
seriousness of this matter.

QUESTION:  I have a question for Charlene Barshefsky.  You spoke about 
Indonesia and the progress you thought they had made in reducing 
tariffs.  I wonder if you could qualify for us the Individual Action 
Plan that China has put forward and what the United States thinks of it?

AMBASSADOR BARSHEFSKY:  I don't want to characterize any of the 
Individual Action Plans.  There is no question that China has moved to 
open its trade regime.  I believe they've made further indications with 
respect to tariffs cuts, in particular.  There is also no question that 
China's trade regime remains highly protected and that trade barriers 
must come down.  Market access must be significantly improved for U.S. 
companies as well as for companies around the world.  We are certainly 
admiring of the progress China has made, and we certainly appreciate the 
progress China has made, as also reflected in their Individual Action 
Plan.  But it is imperative that the market openness of the Chinese 
economy improve significantly.

SECRETARY CHRISTOPHER:  Thank you very much.

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