U.S. DEPARTMENT OF STATE

95/03/08 TESTIMONY: D. BENNET ON FY-96 INTāL ORG. BUDGET

BUREAU FOR INTERNATIONAL ORGANIZATION AFFAIRS







                             STATEMENT BY

                           DOUGLAS J. BENNET

                       ASSISTANT SECRETARY OF STATE

                    FOR INTERNATIONAL ORGANIZATION AFFAIRS

                             BEFORE THE

                      SENATE APPROPRIATIONS COMMITTEE

                      FOREIGN OPERATIONS SUBCOMMITTEE

                             MARCH 8, 1995





Mr. Chairman and Members of the Committee:



I am pleased today to present to you the Administration's Fiscal Year 

1996 request for voluntary contributions to multilateral programs and 

funds under the International Organizations and Programs (IO&P) account.  

The investment proposed is an important and effective means to advance a 

wide range of vital U.S. foreign policy objectives, including promoting 

peace, strengthening democratic institutions, and fostering economic 

prosperity and sustainable development.



United States participation in the organizations and programs presented 

here today contributes to maintaining our global leadership; promoting 

our values of democracy, human rights, and free markets; and cooperating 

in ways that help literally hundreds of millions of people.  Our 

contributions ultimately pay significant dividends back to Americans 

through increased trade, the elimination of epidemic diseases, and the 

reduction of environmental pollution.



The United States achieves enormous leverage through our contributions 

to the agencies and programs in the IO&P account.  For every dollar that 

we contribute to these programs, others in the international community 

typically contribute $8 to $10.  As clearly indicated in a recent survey 

conducted by the University of Maryland, when Americans understand how 

small a percentage of the federal budget goes overseas, they support 

these kinds of expenditures.



Public opinion surveys conducted by the media, university research 

centers, and various think tanks consistently show that a sizeable 

majority of Americans endorse the United Nations' humanitarian, 

developmental, and security objectives.  Americans are pragmatic.  They 

realize that many of the world's problems can only be solved by working 

cooperatively with others, not by going it alone.



The President's FY 1996 Budget requests $425 million for the IO&P 

account.  This includes $355.4 million for programs that promote 

sustainable development, $65 million for promoting peace through two 

non-proliferation programs, and $4.6 million for programs that build 

democracy.  Nearly four-fifths of the sustainable development funds are 

for three key United Nations agencies:  UNDP, UNICEF, and UNFPA.  The 

remaining funding supports several smaller agencies and programs that 

promote economic growth and protect the environment in specialized ways.  

As the following highlights show, many important benefits flow from our 

voluntary participation in these agencies and programs:



UNDP



The UN Development Program is currently charting a bold, new course as 

the central coordinating and funding mechanism for development 

assistance of the UN system.  UNDP emphasizes assistance to emerging 

nations, countries recovering from crisis, and nations working to avoid 

social, political, and economic disintegration.  These programs promote 

free-market reform, privatization, economic growth, democracy, and peace 

-- all of which are congruent with American values.



Benefits to the U.S. include that fact that UNDP's annual purchases from 

American companies typically exceed the amount of the U.S. voluntary 

contribution ($134 million in orders versus $124 million contribution in 

1993).  Furthermore, each dollar we contribute leverages about nine 

dollars through the donations of other nations.



UNDP is a leader within the UN system in management and administrative 

reform.  Since 1992, UNDP has tightened its belt -- cutting its 

administrative budget by 12% in real terms, cutting headquarters staff 

by 25%, and cutting field staff by 8%.  Its new employee performance 

evaluation system, based on those successfully used in private firms, 

has been held as a model for the UN as a whole.

UNICEF



American leadership in the United Nations is epitomized in Jim Grant, 

who died several weeks ago.  Grant leaves a legacy of accomplishments in 

development and humanitarian assistance that made a truly remarkable 

impact on the lives of the world's children.  In his 15 years at UNICEF, 

Jim Grant transformed the agency, focusing it on using low-cost 

technical interventions, modern supply techniques, and advocacy at all 

levels of society to increase immunization of the world's children 

against preventable diseases from 20% in the early 1980s to 80% today.  

Together with the use of oral rehydration salts and other child and 

maternal health initiatives, it is estimated that 25 million children 

and mothers owe their lives today to the energetic and persistent 

efforts of UNICEF.  As Jim Grant said a few weeks before he died:



"These achievements (by UNICEF) have not made the nightly news.  But 

they have changed the daily lives of many millions of families in some 

of the world's poorest communities.  For such progress means that 

approximately 2.5 million fewer children will die in 1996 than in 1990."



The value of UNICEF is well understood by the American people, who have 

supported the organization generously through private donations for over 

40 years.



UNFPA



The UN Population Fund is at the center of a major international effort 

to improve developing countries' family planning and maternal/child 

health care programs.  UNFPA's efforts over the past 25 years have 

contributed significantly to the major decline in birth rates in much of 

the world.  The percentage of couples in developing countries who are 

using contraceptives has increased from 14 percent three decades ago to 

55 percent today.  Those trends have, in turn, reduced pressures for 

trans-border migration, increased per-capita wealth, and slowed 

environmental degradation in many nations.  I should note that UNFPA's 

mission is voluntary family planning.  It does not promote abortion.  In 

fact, it is prohibited from doing so by its charter.



At the present, the world is spending approximately $5 billion annually 

on family planning programs, of which donors contribute only about 20%.  

The world's nations know that now is not the time to declare victory and 

walk away.  The "demographic bulge" of women of child-bearing age is at 

a record high.  Over one hundred million couples still do not have 

access to contraceptives.  The number of people being served by these 

family planning and reproductive health programs is expected to increase 

from 450 million today to 650 million in the year 2000.  If we reduce 

our efforts now, we will likely pay the price later as increasing 

poverty and civil strife overseas push more and more illegal immigrants 

toward our shores.



IFAD



Our request for the International Fund for Agricultural Development is 

vital to our strategy for alleviating rural poverty in developing 

countries.  More than one third of its annual lending goes to Sub-

Saharan Africa.  Its beneficiaries are those most vulnerable in poor 

rural areas, including ethnic minorities, women (who often cannot own 

land in their own right), and recently resettled refugees.  Since 1977, 

IFAD has mobilized loans and grants totalling $4.5 billion to assist the 

rural poor in 102 nations.



MONTREAL PROTOCOL MULTILATERAL FUND



The Multilateral Fund for the Implementation of the Montreal Protocol is 

the complicated-sounding name of an undertaking that is quite simple and 

is important to every human being.  This Fund enables developing 

countries to reverse the human-caused depletion of our planet's ozone 

layer in order to protect against increasing rates of skin cancer, 

immune system suppression, and damage to the environment.  Because ozone 

depletion is a global threat, our nation suffers from damage done beyond 

our borders.



I am happy to report that currently approved Fund projects are expected 

to reduce developing countries' use of certain ozone-depleting 

substances by over 25 percent during the next three years.  But this can 

only happen if the U.S. contributes to the effort.  Should we refuse, 

other nations such as India and China would likely bail out, causing an 

international domino effect that could scuttle the entire effort.  I 

would also point out that, given our global technological leadership, 

U.S. industry's earnings from Fund-financed sales are expected to far 

exceed our contributions to the Fund.



The IO&P account supports a number of other important environmental 

protection programs and conventions such as the Ramsar Convention on 

Wetlands which helps to conserve our stocks of waterfowl and the 

Convention on International Trade in Endangered Species which directly 

benefits U.S. producers and traders of plants and wildlife.



ORGANIZATION OF AMERICAN STATES (OAS)



The Organization of American States promotes democracy and political 

stability in our own back yard.  Led by a dynamic new Secretary General 

and coming off of the recent success of the Summit of the Americas, the 

OAS is well placed to help advance the democratization and development 

of such nations as Guatemala, Nicaragua, Suriname, and Haiti.  The 

contributions contained in our IO&P request would give the OAS the means 

to continue this vital work.  The end result, for the U.S., will be more 

stable and prosperous neighbors that are better able to import our goods 

and less likely to "export" their own people to our shores.

IAEA



Our contributions to the International Atomic Energy Agency serve to 

protect Americans from the awesome danger posed by nuclear 

proliferation.  The IAEA administers a unique system of international 

safeguards to deter the diversion of material and equipment for nuclear 

explosive purposes.  In so doing, the IAEA makes a major contribution to 

international peace and security.  IAEA today applies safeguards on 

nuclear materials and technology at some 822 locations in 61 countries 

around the globe.  This, I think all will agree, should allow Americans 

to sleep a little easier at night.



KOREAN ENERGY DEVELOPMENT ORGANIZATION (KEDO)



The final activity that I would like to single out is the Korean 

Peninsula Energy Development Organization.  KEDO's task will be to 

implement key aspects of the October 21, 1994 Agreed Framework between 

the U.S. and North Korea.  This, if successful, will ultimately lead to 

the complete dismantlement of North Korea's dangerous and destabilizing 

nuclear capability -- a worthy goal indeed.  The Clinton Administration 

strongly believes that full funding for KEDO is a critical instrument 

for promoting our vital national interests in Northeast Asia.



CONCLUSION



There are a number of other organizations and programs in addition to 

the IO&P accounts that I have highlighted.  There is a strong rationale 

for U.S. participation in each.  A strong case exists for the full 

funding of every one of them.  The sums are modest, the burden is 

shared, the benefits are real, our national interests are engaged, and, 

in every case, a measure of U.S. leadership is involved.



With the Cold War behind us, the United States has an unprecedented 

opportunity to shape a world of open societies and open markets -- a 

more peaceful, more democratic, and more prosperous world in which 

America can thrive.  But we cannot do this unilaterally.  Nor can we do 

it by contributing only words.  What is needed is the type of 

multilateral engagement that our FY 1996 IO&P budget request seeks.



Mr. Chairman, I thank you very much and will be pleased to answer any 

questions that you or the Committee may have.



(###)







     UNITED NATIONS DEVELOPMENT PROGRAM (UNDP)

PROGRAM FOCUS:

--  Promote poverty alleviation, job creation, environmental 

regeneration, and the advancement of women

--  Help countries coordinate development assistance

ACCOMPLISHMENTS AND BENEFITS:

--  Expanded markets for U.S. goods and services through more prosperous 

developing nations

--  25% reduction in headquarters staff since 1992

--  $134 million worth of orders to American companies in 1993

--  9:1 match

EXAMPLES:

--  In the West Bank and Gaza, UNDP invested $30 million in 

1994 for shelter, infrastructure, and developing the private sector

--  In Haiti, Mozambique, and El Salvador, UNDP helped conduct 

elections that produced democratically elected governments

--  In South Africa, UNDP helped draft and mobilize funding for the 

nation's reconstruction and development program

--  In India, UNDP financed new applications for jute fibers, including 

apparel and even interior panels for Cadillacs,  improving the lives of 

20 million people depending on jute





     UN CHILDREN'S FUND (UNICEF)

PROGRAM FOCUS:

--  Improve the well-being of children and mothers, the most vulnerable 

groups in developing countries, through long-term development programs 

and emergency assistance

ACCOMPLISHMENTS AND BENEFITS:

--  Helps save lives of over 4 million children annually

--  Pioneered low-cost oral rehydration and other techniques

--  Expresses the humanitarian ideals of the American people, who have 

supported UNICEF with donations for over 40 years

EXAMPLES:

--  Increased immunization of the world's children against 

preventable diseases from 20% in 1980 to 80% today

--  Pioneered "Corridors of Peace" in Guatemala, Sudan, Mozambique, and 

elsewhere to provide vaccines and other assistance to children caught in 

armed conflict

--  Organized the 1990 World Summit for Children where 

governments committed themselves to achieving 20 specific, measurable 

goals to dramatically improve children's lives by the year 2000





     UN POPULATION FUND (UNFPA)

PROGRAM FOCUS:

--  Assure safe, effective, voluntary family planning services

--  Promote awareness of population issues

--  Integrate population concerns into sustainable development plans

ACCOMPLISHMENTS AND BENEFITS:

--  Contributed to the decline in birth rates from around 6 children per 

woman to less than 4 over the past 25 years in developing countries

--  55% of couples in developing countries now use contraceptives 

compared to 14% three decades ago

--  Voluntary family planning saves lives and promotes the health of 

women and children

--  7:1 match

EXAMPLES:

--  Organized the 1994 International Conference on Population and 

Development in Cairo which focused attention on critical population 

issues and outlined a Program of Action to address them

--  UNFPA helped the Republic of Korea stabilize its population growth, 

allowing that nation to focus on economic growth





     INTERNATIONAL ATOMIC ENERGY AGENCY (IAEA)

PROGRAM FOCUS:

--  Stop diversion of nuclear materials from peaceful purposes

--  Upgrade nuclear safety and radioactive waste management

--  Promote the use of nuclear technology for peace, health, and 

prosperity

ACCOMPLISHMENTS AND BENEFITS:

--  Cornerstone of U.S. nonproliferation strategy

--  Develops new technologies to improve safeguards

--  Strengthens ability to track nuclear smuggling

--  Addresses basic human needs (food, water, health) through nuclear 

technology

--  Stimulates export opportunities for U.S. scientific and 

engineering equipment, such as ionization chambers and power generators

EXAMPLES:

--  Helping Eastern European countries improve the operational safety of 

their nuclear power plants

--  Controls destructive medfly populations in Central America U.S. 

contributions for FY 96:

     Assessed  $59.8 million

     Voluntary $43.0 million

     Total    $102.8 million





     INTERNATIONAL FUND FOR AGRICULTURAL DEVELOPMENT (IFAD)

PROGRAM FOCUS:

--  Small-scale projects help rural poor in developing countries grow 

more food, earn more income, and improve nutrition

--  Develops agricultural projects which benefit the most disadvantaged 

of the rural poor, especially women, children, and displaced persons

--  Tests new approaches to rural poverty alleviation that other, larger 

institutions can replicate

ACCOMPLISHMENTS AND BENEFITS:

--  IFAD reduced its administrative spending 13% last year

--  Multipliers:

     --  Provided loans and grants totalling $4.5 billion since 1977 to 

assist the rural poor, leveraging projects worth $14.2 billion

     --  7:1 match

EXAMPLES:

--  Last year, IFAD helped countries that had accepted large numbers of 

Rwandan refugees to switch from emergency relief to long-term 

development

--  An early supporter of the innovative Grameen Bank in Bangladesh, 

IFAD has adapted the Bank's model methods for lending to the rural poor 

for use in Latin America and Africa





     MONTREAL PROTOCOL MULTILATERAL FUND

PROGRAM FOCUS:

--  Reverse depletion of the stratospheric ozone layer which has 

weakened the Earth's shield against ultraviolet radiation

--  Provide financial and technical assistance to developing nations to 

bring them into this global effort

--  Given our technological leadership, U.S. industry's earnings from 

Fund-financed sales are expected to far exceed our contributions to the 

Fund

ACCOMPLISHMENTS AND BENEFITS:

--  Fights cancer and immune system damage

--  Montreal Protocol ratified by over 140 nations, accounting for 

nearly 99 percent of the world's production of ozone-depleting 

substances

--  Currently approved Fund projects are expected to reduce developing 

countries' use of ozone-depleting substances by 25 to 33 percent

EXAMPLES:

--  Broke new ground by implementing accounting concepts that ensure it 

finances only the extra cost of conversion

--  Brought about the successful conversion of facilities in many 

countries, as well as recycling halons and chlorofluorocarbons (CFCs)