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uepartnten t 



jm of state -^^ J ^ 

K Official Monthly Record of United States Foreign Policy / Volume 88 / Number 2133 



April 1988 



National Security / 1 



D:EPOsr;'o;sY 



'H MAY 5 1988 



-OoTOiN] plJBLfO 



Japan / 58 
Egypt / 72 





Cover: Japanese flag (left); 
Egyptian flag (right). 



Dppartntpni of Statp 

bulletin 



Volume 88 / Number 2133 / April 1988 



The Department of State Bulletin, 
published by the Office of Pubhc Com- 
munication in the Bureau of Public 
Affairs, is the official record of U.S. 
foreign policy. Its purpose is to provide 
the public, the Congress, and govern- 
ment agencies with information on de- 
velopments in U.S. foreign relations 
and the work of the Department of 
State and the Foreign Service. The 
Bulletin's contents include major 
addresses and news conferences of the 
President and the Secretary of State; 
statements made before congressional 
committees by the Secretary and other 
senior State Department officials; se- 
lected press releases issued by the 
White House, the Department, and the 
U.S. Mission to the United Nations; 
and treaties and other agreements to 
which the United States is or may be- 
come a party. Special features, articles, 
and other supportive material (such as 
maps, charts, photographs, and graphs) 
are published frequently to provide ad- 
ditional information on current issues 
but should not necessarily be inter- 
preted as official U.S. policy 
statements. 



GEORGE P. SHULTZ 

Secretary of State 

CHARLES REDMAN 

Assistant Secretary 
for Public Affairs 

PAUL E. AUERSWALD 

Director, 

Office of Public Communication 

NORMAN HOWARD 

Chief, Editorial Division 

PHYLLIS A. YOUNG 

Editor 

SHARON R. HAYNES 

Assistant Editor 



The Secretary of State has determined that 
the publication of this periodical is neces- 
sary in the transaction of the public busi- 
ness required by law of this Department. 
Use of funds for printing this periodical 
has been approved by the Director of the 
Office of Management and Budget through 
September 30, 1988. 



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It 
lit 



CONTENTS 



Di;=CSiTOriY IFEATURE 



if-'AYS 1988 \%: 

^■^CM PUBLIC I '■^■^•■"^■'" 



1 National Security Strategy of the United States 
{President Reagan) 



("Ij President 

2 Peace and Democracy for 

Nicaragua 

n? Secretary 

15 The Struggle Against Terrorism 

16 Managing the U.S. -Soviet 

Relationship 
'3 America's Foreign Policy 

Agenda in 1988 
If Interview on "This Week With 

(David Brinkley" 
(Excerpts) 

4 ns Control 

'i. Nuclear Testing "Kilks Open 

Round Two (White House 

Statement) 
)1 Conference on Disarmament 

Reconvenes in Vienna 

(President Reagan) 
i1 Soviet Experts Visit U.S. 

Nuclear Test Site (Joint 

Statement) 



East Asia 

52 U.S.-ASEAN Dialogue Held in 

Washington (Secretary 
Sliultz, Yeo Cheow Tong, 
Joint Statement) 

58 U.S. -Japanese Relations in 

Focus (William Clark, Jr.) 

61 Visit of Japanese Prime Minis- 

ter (President Reagan, 
Noboru Takeshita, Joint 
Stateme7it) 

64 U.S. -Japanese Relations 

Economics 

65 U.S. Removes GSP Status for 

Four Economies (White House 
Statement, White House Fact 
Sheet) 



Europe 



66 



68 



The U.S. Approach to Eastern 
Europe: A Fresh Look 
(John C. Whitehead) 

U.S.-U.S.S.R. Meeting on 
Fisheries Issues (Joint 
Statement) 



I Corrections 

« September 1986 issue of the Bulletin The opening paragraph of a statement 

■ried an incorrect version of the Depart- by J. Stapleton Roy made on September 

Int statement of June 9, 1986, concerning 22, 1987, on New Zealand (see Bulletin of 

tctions to the German Democratic Re- November 1987, page 46) should read: 
plic's Volkskanimer. The second para- "I am pleased to appear before the 

f ph of that statement (page 59) should subcommittee to discuss U.S. policy to- 

I d: ward New Zealand and specifically to pre- 

"The procedure under which the East- sent the Administration's position on H.R. 

«i sector of Berlin directly elects repre- 85, the New Zealand Preference Elimina- 

Sitatives to the Valkskammer. and tion Act. The Administration supports en- 

iTeby treats this sector as if it were part actment of H.R. 85 as an appropriate 

' :he territory of the G.D.R., is in contra- response to New Zealand's recent enact- 

tion with the wartime and postwar ment of its antinuclear legislation." 

•eements defining the status of the spe- 

I Berlin area, and accordingly, also in 

itradiction with the Quadripartite 

leement of September .3, 1971, which ap- 

>s to the whole of Berlin." 



The Editor 



69 35th Report on Cyprus (Mes- 

sage to the Congress) 

Human Rights 

70 The Semantics of Human 

Rights (Richard Schifter) 

l\/liddle East 



72 



74 
79 



Visit of Egyptian President 

(Hosni Mohammed 

Mubarak, President Reagan) 
Arab Republic of Egypt 
Passport Restriction for 

Lebanon (Department 

Statement) 



Soutli Asia 



80 



Continuation of Aid to Pakistan 
(White House Statement) 



United Nations 



81 



UN Agencies and the Budget 
(Richard S. Williamson) 



Western Hemisphere 



85 
85 



86 



Panama (Department Statement) 
Aid to Nicaragua (White House 

Statements) 
Central American Peace 

Process (White House 

Statement) 



Treaties 

87 Current Actions 

Press Releases 

89 Department of State 

Publications 

89 
90 



90 



Department of State 
Foreign Relations Volume 

Released 
CSCE Semiannual Report 

Released 



Index 




FEATURE 
National Security 



National Security Strategy 
of the United States 



This statement of America's National 
Security Strategy builds on my initial 
report to the Congress and the Ameri- 
can people last year. In the twelve 
months since, the strategy outlined in 
that first report has served the nation 
well in protecting our interests and ad- 
vancing our security objectives around 
the world. 

In my last year's report I noted 
that, at the outset of this Administra- 
tion, I had set forth four broad objec- 
tives that underpinned our National 
Security Strategy. They were: 

• First, to restore our nation's mili- 
tary strength after a period of decline 
in which the Soviet Union overtook us 
in many critical categories of military 
power; 

• Second, to restore our nation's 
economic strength and reinvigorate the 
world economic system; 

• Third, to restore the nation's in- 
ternational prestige as a world leader; 
and 

• Fourth, to restore pride among 
all Americans and carry our message to 
the world that individuals and not gov- 
ernments should control their eco- 
nomic, spiritual and political destinies. 

Our National Security Strategy 
continues to be aimed at reinforcing the 
gains we have achieved in each of these 
areas, while employing all the elements 
of our national power — political, eco- 
nomic and military — in a coordinated 
way to advance the full range of na- 
tional security interests outlined else- 
where in this report. 

The fundamentals of our strateg;y 
change Httle from year to year; our in- 
terests and objectives are derived from 
enduring values. Much of the discussion 
in this report therefore parallels that of 
last year, with changes as necessary to 
reflect significant developments in the 
interim. These include: 



• Our persistence and adherence to 
principle have borne fruit in the his- 
toric agreement to eliminate intermedi- 
ate-range nuclear forces (INF) — the 
first of the nuclear era to achieve mean- 
ingful reductions in U.S. and Soviet ar- 
senals. This treaty is a victory for the 
Atlantic Alliance as well, reflecting the 
firmness that all allies showed. We have 
also made further progress toward a 
START [strategic arms reduction talks] 
agreement that could cut U.S. and So- 
viet strategic offensive arms by 50 
percent. 

• Our SDI [Strategic Defense Ini- 
tiative] program is making great prog- 
ress, moving us toward the prospect of 
a safer world — one which depends for 
its security on strategic defense, rather 
than on the threat of mutual nuclear 
retaliation. 

• In the Persian Gulf we have aug- 
mented our traditional military pres- 
ence to prevent Iran from interfering 
with U.S. -flag shipping and to support 
our diplomatic efforts to bring an end 
to the tragic Iran-Iraq war. Our allies' 
contributions to the safe navigation of 
the Gulf by non-belligerent shipping 
are welcomed, and underline the impor- 
tance which the Free World ascribes to 
this strategically and economically piv- 
otal region of the world. 

• Critical imbalances remain in the 
international economy which could por- 
tend problems ahead unless they are 
addressed in a forthright and effective 
manner by the governments of the in- 
dustrialized nations. The major world 
economies, including our own, are 
sound and can provide the basis for 
continued growth and prosperity, pro- 
vided we and our partners deal with 
important fiscal, trade and budgetary 
issues in sensible and cooperative ways. 

• In the Soviet Union we hear talk 
of "new thinking" and of basic changes 
in Soviet policies at home and abroad. 



We will welcome real changes, but we 
have yet to see any slackening of the 
growth of Soviet military power, or 
abandonment of expansionist aspira- 
tions. As we work to find areas for fur- 
ther cooperation, we will continue to 
judge the Soviets by their actions, 
rather than their words, and to found 
our National Security Strategy on a re- 
alistic view of Soviet aims and 
capabilities. 

• On many continents, efforts by 
the Soviet Union and its clients to im- 
pose or maintain Leninist regimes by 
force of arms are meeting increasing 
resistance. In Afghanistan, Nicaragua, 
Angola, and Cambodia, anti-Communist 
insurgencies are raising the cost of ag- 
gi'ession and offering hope of just politi- 
cal solutions. Our strong support for 
Freedom Fighters, from Afghanistan to 
Nicaragua, is a vital insurance policy 
for peace with freedom. We are encour- 
aging the broader democratic trend in 
the world — from Latin America to the 
Philippines, to the Republic of Korea. 

• At home, however, the reluctance 
on the part of the Congress to provide 
the financial resources necessary to 
support our National Security Strategy 
is a cause for rising concern. Our as- 
sessment of risks to important U.S. in- 
terests has increased, and some of the 
recent gains in redressing the military 
and geopolitical balance are in 
jeopardy. The implications of this ad- 
verse trend, now in its third year, are 
discussed in more detail in the final 
chapter of this report. 

I forward this report with the con- 
fidence that it will help the Congress 
and the American people better under- 
stand our National Security Strategy 
and contribute to the consensus needed 
to enable us to fulfill our respon- 
sibilities as leader of the world's 
democracies. 

As I said in last year's report, we 
must never forget that freedom is never 
really free; it is the most costly thing in 
the world. And freedom is never paid 
for in a lump sum. Installments come 
due in every generation. All any of us 
can do is offer the generations that fol- 
low a chance for freedom. In the final 
analysis, this is the assurance that our 
National Security Strategy seeks to 
provide. I commend its reading to all 
Americans. 

Ronald Reagan 



I. Historical Dimensions 
of U.S. National Security Strategy 



This is my second report to the Con- 
gress on our National Security Strat- 
egy. Its focus is on how the principal 
elements of national power — diplomatic 
and informational, economic and mili- 
tary — can be employed to support our 
national interests and promote the ob- 
jectives of peace, security, and free- 
dom. It analyzes the major political, 
economic, and military threats to our 
interests, and discusses the strategies 
that we believe most appropriate to re- 
spond to those threats and to help 
share the futui-e in accordance with our 
positive goals and ideals. It also dis- 
cusses some of the dilemmas, tradeoffs 
and risks that America faces, because 
we realize that our knowledge of our 
adversaries is never certain and that all 
resources, including our national will, 
are finite. Walter Lippmann once 
wrote: 

. . . the behavior of nations over a long 
period of time is the most reliable, though 
not the only index of their national inter- 
ests. For though their interests are not 
eternal, they are remarkably persistent 
. . . There is no great mystery why this 
should be; the facts of geography are per- 
manent . . . thus successive generations of 
men tend to face the same recurrent prob- 
lems and to react to them in more or less 
habitual ways. 

Lippmann's observation is particu- 
larly apt. While it is commonplace to 
hear that U.S. National Security Strat- 
egy changes erratically every four to 
eight years as a result of a new Admin- 
istration taking office, in reality there 
is a remarkable consistency over time 
when our policies are viewed in histor- 
ical perspective. The core interests and 
objectives of this Nation have changed 
little since World War II. 

The first historical dimension of 
our strategy is relatively simple, clear- 
cut, and immensely sensible. It is the 
conviction that the United States' most 
basic national security interests would 
be endangered if a hostile state or 
group of states were to dominate the 
Eurasian landmass — that area of the 
globe often referred to as the world's 



heartland. We fought two world wa 
prevent this from occurring. And, f 
1945, we have sought to prevent thi 
Soviet Union from capitalizing on i' 
geostrategic advantage to dominate 
neighbors in Western Europe, Asia 
and the Middle East, and thereby 
damentally alter the global balance 
power to our disadvantage. 

The national strategy to achie\ 
this objective has been containmen 
the broader sense of that term. Ad 
istrations have differed over which 
instruments of national power — dip 
matic and informational, economic 
military — should receive the most , 
tention at any particular time. But 
the final analysis, every Administr 
since World War II has endorsed t 
concept that the United States, in 
nership with its allies, must prevei 
the Soviet Union from dominating 
those great concentrations of induf 
power and human capacity that arc 
Western Europe and East Asia. Tl 
shortly after World War II, the Ui 
States helped rebuild, through the 
shall Plan, the war-ravaged econon 
of Europe, limiting Soviet opportu 
to exploit Europe's economic distn 
In addition, America deployed mih 
forces forward, as necessary, to he 
deter and contain Soviet military t 
pansion. As Soviet capabilities gre 
our security also required a large i 
tegic nuclear force to augment the 
ward-deployed conventional deterr 
and to reinforce our deterrence of 
nuclear and conventional attacks o 
ourselves or our allies. 

The advent of nuclear weapons 
intercontinental delivery systems i 
another dimension to our thinking 
about National Security Strategy: 
weapons became the primary threi 
our national survival. Thus, for ovi 
forty years, the deterrence of nucl 
war and the reduction of its threat 
been major objectives of U.S. Nat pi 
Security Strategy. We have pursue 
these objectives with renewed vig< 
and heartening results, during thi. 
Administration. 



Department of State Bket 



FEATURE 
National Security 



Similarly, the economic element of 

i national power has long been an 
rtant component of our National 
rity Strategy. This Administra- 
; strong support for an open and 
\j nding world economy and trading 
vS'm reflects a fundamental national 
rtest. The industrial democracies 
a1 long been important trading na- 
,0 . An open world of enterprise and 
ne ree movement of people, goods, 
n. deas are not only the keys to our 
'I lerity, but basic moral principles. 
' ('(■ an e.xpanding global prosperity 
ihaiicing our own. The global econ- 
:: is clearly even more interdepend- 
n' low than early in this century 
■^ I America first endorsed these 
1] >!(■.■<; and our need for access to 
t'ts and raw materials has in- 
ri ^ed. As a result, our commitment 

I ?e and fair trade among nations is 
fi :er today than ever. 

The facts of geography, as Lipp- 
i; 1 pointed out, dictate basic dimen- 
ni' (lur National Security Strategy. 
the early 19th century we have 
' caicd invasions of the American 
land; and even to this day, our na- 
I tei-ritory remains relatively se- 
aiiaiiist conventional attack, 

■ 'ctcd by oceans on the east and 

( aiHJ friendly nations to our imme- 

i: niii'th and south. However, nu- 

w lapons and the means to deliver 

vM'apons over great distances can 

u threaten our national survival. And 

II of our friends and allies — as well 
s le markets and resources that are 
ll (rated with our economy — are 
lically distant from the continental 
'ied States. 

To help protect our friends and al- 
t' and other U.S. interests abroad, 
iiist not only possess national 

■ igth. but we must be able to pro- 
K this power — diplomatic and infor- 
I onal, economic and military — 

ss great sea and air distances. In 
military sphere, we must maintain 
2apability to secure our worldwide 
i of communication; to project mili- 

power quickly; to sustain forces at 
.t distances for extended periods of 
i; and to pose a credible deterrent 
lose who might contemplate aggres- 

against our allies and friends. 



The United States has long recog- 
nized that, even as we have taken up a 
major role of world leadership, our in- 
terests and political values call for a 
deepening partnership with like-minded 
nations to advance the cause of peace 
and freedom. Thus, abiding commit- 
ment to strong alliances has been a con- 
sistent and vital component of 
American strategy since the Second 
World War. Even if we could afford, 
economically and militarily, to chart our 
National Security Strategy without al- 
lies — which we cannot — we would not 
want to do so. "Fortress America" is an 
obsolete concept. Such a policy would 
be dangerously misguided and self-de- 
feating. Solidarity with our allies multi- 
plies the strength of all. It permits a 
sharing of responsibilities and it re- 
minds us that the cause of democracies 
is, after all, one of our most fundamen- 
tal goals. 

As with all Administrations, during 
our stewardship we have faced unique 
security challenges — and oppor- 
tunities — presented by a dynamic world 
and America's own needs. This has 
given our National Security Strategy 
two additional emphases worth noting. 
The first is realism. We have sought to 
deal with the world as it is, not as we 
might wish it to be. A strategy without 



illusions, based on observable facts, has 
been our goal. We attempt to deal with 
both friends and adversaries on a basis 
that recognizes that acts are more 
important than words, and that frank- 
ness is the foundation of productive and 
enduring relationships among nations. 
At the same time, we have emphasized 
our willingness to dialogue — to engage 
our adversaries, in particular, in nego- 
tiations aimed at finding areas of com- 
mon interest, reducing sources of 
tension, and rendering our relations 
more stable and predictable. By empha- 
sizing realism and a willingness to talk, 
we have been able to place our arms 
reduction negotiations with the Soviets 
on a more solid basis, culminating in 
the first agreement between the super- 
powers to achieve significant reductions 
in nuclear arsenals. 

This list of historical dimensions of 
U.S. National Security Strategy could 
be extended. Academics and practi- 
tioners have debated the issue for 
years. But the fundamental point 
should be clear: there has been im- 
pressive continuity in U.S. National Se- 
curity Strategy, reflecting the fact that 
the strategy is grounded in unchanging 
geographic considerations and designed 
to preserve the fundamental values of 
our democracy. 



II. Fundamentals of U.S. National Security Strategy 



THE FRAMEWORK— VALUES, 
INTERESTS, AND NATIONAL 
SECURITY OBJECTIVES 

Traditionally national security has been 
viewed as protection from external at- 
tack, thought of largely in terms of mil- 
itary defenses against military threats. 
But that is clearly too narrow a concep- 
tion. A nation's security today involves 
much more than the procurement and 
application of military forces. 

National Security Strategy must 
start with the values that we as a na- 
tion prize. Last year, in observing the 
200th anniversary of our Constitution, 



we celebrated these values with a sense 
of rededication — values such as human 
dignity, personal freedom, individual 
rights, the pursuit of happiness, peace 
and prosperity. These are the values 
that lead us to seek an international 
order that encourages self-determina- 
tion, democratic institutions, economic 
development, and human rights. The 
ultimate purpose of our National Se- 
curity Strategy is to protect and ad- 
vance those values. But, if they are to 
serve as the basis of a National Se- 
curity Strategy, these values must be 
translated into the more concrete terms 
of national interests and objectives. 



1988 



U.S. Interests 

Our National Security Strategy reflects 
our national interests and presents a 
broad plan for achieving the national 
objectives that support those interests. 
The key national interests which our 
strategy seeks to assure and protect 
include: 

1. The survival of the United States 
as a free and independent nation, with 
its fundamental values intact and its in- 
stitutions and people secure. 

2. A healthy and growing U.S. 
economy to provide opportunity for in- 
dividual prosperity and a resource base 
for our national endeavors. 

3. A stable and secure world, free 
of major threats to U.S. interests. 

4. The growth of human freedom, 
democratic institutions, and free mar- 
ket economies throughout the world, 
linked by a fair and open international 
trading system. 

5. Healthy and vigorous alliance 
relationships. 



the United States, its interests, and its 
allies. Specifically: 

• To deter hostile attack on the 
United States, its citizens, military 
forces, or allies and to defeat attack if 
deterrence fails. 

• To deal effectively with threats to 
the security of the United States and 
its citizens short of armed conflict, in- 
cluding the threat of international 
terrorism. 

• To prevent the domination of the 
Eurasian landmass by the Soviet 
Union, or any other hostile power or 
coalition of powers. 

• To prevent transfer of military 
critical technologies and resources to 
the Soviet bloc and hostile countries or 
groups. 

• To reduce our reliance on nuclear 
weapons by strengthening our conven- 
tional forces, pursuing equitable and 
verifiable arms control agreements, and 
developing technologies for strategic 
defense. 

• To assure unimpeded U.S. access 
to the oceans and space. 



National Security Strategy must start with the values that we as a 
nation prize . . . such as human dignity, personal freedom, individual 
rights, the pursuit of happiness, peace and prosperity. 



Major Objectives in 
Support of U.S. Interests 

U.S. national security objectives are 
broad goals refined from our national 
interests. They provide a general guide 
for strategy in specific situations which 
call for the coordinated use of national 
power. Our principal national security 
objectives are: 

1. To maintain the security of our 
nation and our allies. The United 
States, in cooperation with its allies, 
must seek to deter any aggression that 
could threaten that security and, should 
deterrence fail, must be prepared to re- 
pel or defeat any military attack and 
end the conflict on terms favorable to 



• To foster closer relations with the 
People's Republic of China. 

• To prevent the spread of nuclear 
weapons. 

2. To respond to the challenges of 
the global economy. Our national se- 
curity and economic strength are indi- 
visible. As the global economy evolves 
in increasingly interdependent ways, 
we must be aware of economic factors 
that may affect our national security, 
now or in the future. Since our depend- 
ence on foreign sources of supply has 
grown in many critical areas, the poten- 
tial vulnerability of our supply lines is a 
matter of concern. Additionally, the 
threat of a global spiral of protec- 
tionism must be combatted, and the 



problem of debt in the developing wi ; 
is a burden on international prosperii) 
Specifically: t 

• To promote a strong, prospero ' 
and competitive U.S. economy, in th ' 
context of a stable and growing worl 
economy. 

• To ensure access to foreign m; 
kets, energy, and mineral resource^ 
the United States and its allies and 
friends. * 

• To promote a well-functioning t; 
ternational economic system with m- 
mal distortions to trade and 
investment, with stable currencies, 
broadly agreed and respected rules 
managing and resolving differences. 

3. To defend and advance the a 
of democracy, freedom, and human 
rights throughout the world. To igrt 
the fate of millons around the worl(J 
who seek freedom betrays our natic* 
heritage and over time would endai!- 
our own freedom and that of our all 
Specifically: 

• To promote national independ 
and the growth of free institutions 
worldwide. 

• To encourage and support aid 
trade, and investment programs th; 
promote economic development and 
growth of free and humane social a: 
political orders in the Third World. 

• To encourage liberalizing tem 
cies within the Soviet Union and it 
client states. 

4. To resolve peacefully disputi 
which affect U.S. interests in troul 
regions of the world. Regional conf 
which involve allies or friends of th 
United States may threaten U.S. ii 
ests and frequently pose the risk o. 
calation to wider conflagration. 
Conflicts, or attempts to subvert 
friendly governments, which are in 
gated or supported by the Soviets 
their client states, represent a par 
larly serious threat to the internat; 
system and thereby to U.S. interei 
Specifically: 

• To address, where possible, 1 
root causes of regional instabilities 
which create the risk of war. 

• To maintain stable regional n^ 
tary balances vis-a-vis the Soviet l|a< 
and states aligned with it. 



Department of State BiiJ 



FEATURE 
National Security 



» To neutralize the efforts of the 
oy.t Union to increase its influence in 
levorld, and to weaken the links be- 
VI n the Soviets and their client 
a s in the Third World. 

> To aid in combatting threats to 
W tability of friendly governments 
It nstitutions from insurgencies, sub- 
si ons, state-sponsored terrorism and 
i^ nternational trafficking of illicit 

OS. 

■). To build effective and friendly 
I loiiships with all nations with 

11 t here is a basis of shared con- 
Bi In the world today, there are over 
M ations. Not one of them is the 
qi I of the United States in total 
oj r or wealth, but each is sovereign, 
ninost, if not all, touch U.S. inter- 
b( directly or indirectly. Specifically: 

■ To make major international in- 
ti tions more effective in promoting 
e, ?, world order and political, eco- 

c and social progress. 

• To seek opportunities to improve 
ej ions with the Soviet Union on a 

ej itic and reciprocal basis. 

» To improve relations with other 
A ns hostile to us in order to reduce 
b hance of future conflict. 

• To strengthen U.S. influence 

1 ighout the world. 



INCIPAL THREATS TO 
I INTERESTS 

Smost significant threat to U.S. se- 
y interests remains the global chal- 
; posed by the Soviet Union, 
lite reforms that the leadership of 
tioviet Union has recently under- 
n — the significance and durability 
I lich remain unclear — Soviet mili- 
H power and active diplomacy con- 
■I ; forcefully to challenge our vital 
ll'ests in many parts of the world. 
m. Soviet Union places a high priority 
•(feating and exploiting divisions 
lUin and among the Western allies. 
Bjey developing countries it supports 
•jifiunist parties, insurgent move- 
nts, and other elements that seek to 
llirmine governments allied with or 
Widly to the United States and to 
dice them with authoritarian or to- 
farian regimes. In other developing 



countries, modernizing forces strug- 
gling to create or consolidate demo- 
cratic and free market societies are 
actively opposed by groups supported 
or inspired by the Soviet Union and its 
allies. 

As a result of changes in leadership 
style, the Soviet Union has succeeded 
in projecting a more favorable interna- 
tional image. Proposed domestic re- 
forms and foreign policy initiatives have 
given rise, in some cases, to hopes for 
fundamental changes in Soviet behav- 
ior. The new style of Soviet policy has 
its political impact. Moscow is moving 
in new directions, offering an array of 
initiatives, putting old assumptions in 
doubt, attracting new support interna- 
tionally, and sometimes placing West- 
ern governments on the defensive. This 
poses a new, continuing, and more so- 
phisticated challenge to Western policy. 
Whether recent changes constitute a 
real opportunity for more fundamental 
improvements in relations with the So- 
viet Union remains to be seen. We are 
open-minded on this score. While rec- 
ognizing the competitive and predomi- 
nantly adversarial character of our 
relationship, we shall maintain a di- 
alogue with the Soviet Union in order 
to seize opportunities for more con- 
structive relations. 

Although the Soviet Union still 
poses the primary security threat, we 
and our allies and friends also face a 
diversity of other serious security chal- 
lenges: regional and low-intensity con- 
flicts; the potential for nuclear 
proliferation; international terrorism; 
narcotics trafficking; radical politico-re- 
ligious movements; and problems of in- 
stability, succession, and economic 
development in countries that are 
important friends and allies. 

In Europe, the principal threat to 
America's interests, and to those of our 
allies, continues to be that posed by the 
ongoing buildup of Warsaw Pact mili- 
tary capabilities. For decades the So- 
viet Union has allocated a dispropor- 
tionately high share of its national 
income to military expenditures and 
has created technologically sophisti- 
cated forces far in excess of any plausi- 
ble need for self-defense. Equally 
threatening, but much more subtle, is 



the continuous political warfare against 
Western cohesion through propaganda, 
particularly focused on the younger 
generations of Western Europeans. 
Through such means the Soviet Union 
is attempting to affect public opinion in 
allied countries to weaken relations 
with the United States, erode the com- 
mitment to defense, and encourage sup- 
port for Soviet policies and proposals. 
Ultimately, the Soviet Union still seeks 
to separate Western Europe politically 
and militarily from the United States, 
thereby altering the global balance of 
power in the most fundamental way. 

Beyond the challenges in Europe, 
other areas give cause for concern. 
Free World interests in the Middle 
East are seriously threatened by the 
protracted war between Iran and Iraq, 
and by Iran's drive to become the domi- 
nant power in the region. Tehran's 
threats to friendly Gulf States and to 
international shipping in the Persian 
Gulf have caused the United States and 
several of its allies to provide naval pro- 
tection for their own shipping, and to 
assist certain of the Gulf States. The 
aggressive radical regime in Iran per- 
sists in threatening its neighbors which 
are friends of the United States with 
military force, and through terrorism 
and subversion. Its terrorist surrogates 
in Lebanon fuel the anarchy in that 
stricken country, while Iran advertises 
its willingness to use terrorism against 
United States personnel and facilities in 
the Middle East and elsewhere. What- 
ever Iran's mistrust of the Soviet 
Union, Iran's policies undermine West- 
ern friends and Western relationships 
in the Middle East and objectively ben- 
efit the Soviet Union globally. 

Fragile democratic governments in 
Central and South America are being 
confronted by myriad social and eco- 
nomic problems. At the same time, rad- 
ical and insurgent groups supported by 
the Soviets, the Sandinista regime in 
Nicaragua, and by Cuba are a source of 
political destabilization. Prospects for 
an enduring peace in Central America 
will be bleak as long as the Sandinista 
leaders betray their promises of genu- 
inely democratic government and sup- 
port insurgent forces attempting to 
subvert their neighbors. 



I1 1988 



Other regional tensions and con- 
flicts — such as those on the Korean 
peninsula, in Indochina, in Southern 
Africa, and between Israel and its Arab 
neighbors — threaten both international 
peace and the internal stability of 
friendly states. In the Philippines, for 
example, the fledging democratic gov- 
ernment is besieged by a variety of ex- 
tremist forces some of which wish to 
impose authoritarian regimes. 

Low intensity conflicts, the in- 
creasing linkages between international 
terrorists and narcotics traffickers, as 
well as racial, sectarian, and other ten- 
sions continue to challenge U.S. inter- 
ests and our hopes for human 
betterment. Refugees from these con- 
flicts can place powerful burdens on the 
economies and societies of host coun- 
tries, and require substantial quantities 
of international relief 

The spread of nuclear weapons to 
additional nations threatens to exacer- 
bate regional conflicts and could con- 
ceivably involve the United States and 
the Soviet Union in nuclear conflicts. 
This proliferation could ultimately make 
nuclear deterrence less stable. At this 
time, the most difficult regional nuclear 
rivalry involves India and Pakistan, but 
other areas of the world, including the 
Middle East, Africa, and Latin Amer- 
ica could be subject to similar dangers 
in the future. 

Although in recent years the inter- 
national economic and financial system 
has proved to be remarkably resilient, 
sudden, unexpected shocks can pose 
major new challenges to U.S. interests. 
The hard currency debts of many devel- 
oping nations — including several that 
are neighbors and important friends 
and allies of the United States — have 
had severe and destabilizing conse- 
quences within their societies. Most of 
the debtor states have been unable to 
achieve sustained and significant eco- 
nomic growth since the early 1980s and 
have experienced high rates of unem- 
ployment and inflation, and extended 
periods of unpopular austerity. Many of 
these countries are also adversely af- 
fected by low commodity prices in the 
international market, capital flight, ex- 
cessive government spending, narcotics 
production and trafficking, and other 



indigenous and externally imposed 
problems that will not be easily reme- 
died. The longer the economies of the 
major debtor states fail to rebound 
from these conditions, the greater are 
the possibilities that irresponsible ele- 
ments will gain local support for na- 
tionalistic responses that could damage 
important U.S. interests. 

In addition, rising pressure in some 
major trading nations for greater pro- 
tection from foreign competition could 
place powerful new downward pressure 
on these national economies. Poten- 
tially, this could result in a spiral of 
protectionist measures that would en- 
danger the international trading 
system. 

Finally, the prospects for world 
peace and prosperity — and thus for 
U.S. interest in a just and progressive 
international order — will be influenced 
by other problems in certain parts of 
the world. Critical shortages of food, a 
lack of health services, and inabilities 
to meet other basic needs will keep mil- 



lions of people, particularly in Africa 
in peril. The dangerous depletion or 
contamination of the natural endow- 
ments of some nations — soil, forests, 
water, air — will add to their environ- 
mental and health problems, and in- 
creasingly to those of the global 
community. These problems cannot I 
resolved simply through outside as- 
sistance, for many of them will requ 
policy changes and leadership by go 
ernments and elites in the countries 
themselves. But all create potential 
threats to the peace and prosperity 
that are in our national interest, as 
as the interests of the affected natio 
In summary, this broad range o 
threats to our national interests pro 
vides the backdrop against which w 
formulate our National Security Str 
egy. As we seek ways to promote oi 
national interests and objectives, a 
careful understanding of these evoh 
threats is essential to proper strate; 
formulation. 



I. Power, Policy, and Strategy 



ELEMENTS OF U.S. 
NATIONAL POWER 

Having described our national security 
interests, objectives, and the range of 
threats that we face, it is appropriate 
next to turn to the national means 
available to achieve our objectives and 
to the strategies that relate means to 
ends. 

The means available are the ele- 
ments of national power that the 
United States possesses — diplomatic 
and informational, economic and mili- 
tary — and which we employ to influence 
the behavior of other nations. Power, it 
is often said, is the quintessence of 
strategy. Unfortunately, America's na- 
tional power is sometimes thought of 
only in coercive or military terms. I 
believe, however, that national power is 
also derived from a nation's moral legit- 
imacy and leadership, as we exempli- 
fied by the Marshall Plan after World 
War II — an act of strengthening allies. 



of enlightened self-interest. Today, : 
tions understand that the effective 
of national power is something mon 
than the simple use of force; and W( 
seek to follow a National Security 
Strategy that ensures we can relate 
other nations on the basis of credib: 
rather than simple capability. 

We have an exceptionally diver; 
array of instruments for employing 
various elements of national power, 
ercised by the Executive Departme 
and Agencies, these tools are most 
fective when integrated, tailored to 
specific situation, and guided by a ( 
mon strategy for their implementat 
These instruments include: 

• Moral and political example. 

American spirit and prosperity rep) 
sent a critical challenge to the ideol 
and the practical record of our adve 
saries: free, pluralist societies work 
Since the days of our Founding FatlM 
this power of example has represen d 



Department of State BitSl 



FEATURE 
National Security 



f^ent leverage in international rela- 
o;. But we should not leave its ex- 
^iiin and understanding to chance. 
ill our interest to spread this mes- 
,, ill an organized and effective way. 

• Military strength. A strong mili- 
U capability is essential for a stable, 

e environment in which our adver- 

> lie deterred and diplomacy can 
effective. 

► Economic vitality. America's eco- 

c strength sustains our other ele- 
i« s of power and fortifies our 

el ions with the countries that share 
:. ntt-rest in a free and open interna- 
1 economy. 

• Alliance relationships. The pur- 
ui 3f American security objectives de- 
ft s on cooperation with like-minded 
it national partners. These rela- 

io hips enhance our strength and mit- 
" the understandable reluctance of 
!' American people to shoulder se- 
j y burdens alone. The predictable 
iJ 'ulties that arise from time to time 

1 alliance relationships must be 

U lured against the enormous bene- 

Ihat these ties bring us and our 
ds. 
>» Public diplomacy. This is a key 
ument — one with an impact both 
ig and subtle on international polit- 
jvents and how people perceive 
1. Through our public diplomacy ac- 
les, we seek to explain to foreign 
3nces our policies and actions in 
; that are clear, credible, and likely 
icit support for our interests and 
ctives. 

•• Security assistance. By helping 
ids and allies acquire the means to 
nd themselves, we complement the 
ilding of our own military strength 
increase the human and material 
urces available for the defense of 
world interests. In the process, we 
ce the likelihood of direct Ameri- 
involvement in potential conflicts, 
trity assistance is a key instrument 
ir national security strategies, a 
luctive and highly leveraged invest- 
t that promotes our security inter- 
at bargain prices. 
[• Development assistance. It is in 
national interest to support efforts 
iendly developing countries to pro- 
J for the basic needs of their people. 

^988 



Development assistance plays a vital 
role in encouraging market-oriented ap- 
proaches with the potential to increase 
income levels in recipient countries. A 
well structured and financed develop- 
ment assistance program enhances our 
world leadership and influence. 

• Science and technology coopera- 
tion. For many countries, access to ad- 
vanced scientific and technological 
resources is critical to prosperity and 
long-term economic growth. U.S. world 
leadership and our vast resources in 
science and technology are important 
strategic assets to strengthen existing 
ties with friends and allies; and pro- 
mote positive relationships with key de- 
veloping nations. 

• International organizations. 
Multilateral diplomacy and participation 
in international organizations such as 
the United Nations and the Interna- 
tional Monetary Fund provide oppor- 
tunities to address common global 
problems and share the task of solving 
them. Skillful diplomacy within these 
and other multilateral organizations can 
serve to enhance our overall goals on 
issues such as peacekeeping, promotion 
of human rights, and encouraging the 
development of free economic and poht- 
ical systems. 

• Diplomatic mediation. In re- 
gions where conflict threatens our in- 
terests or those of our friends, political 
efforts can play a major role in ending 
violence, promoting freedom and na- 
tional self-determination, and laying the 
foundations for future stability. The ini- 
tiatives of American diplomacy take 
their strength from effective and inte- 
grated use of the tools already dis- 
cussed, and from the ability of U.S. 
representatives to act credibly as medi- 
ators of disputes. Making clear the 
firmness of our commitments to friends 
and allies increases the incentives to 
negotiate seriously. 



A PERIOD OF TRANSITION 

We are living in times that historians 
will characterize as a period of transi- 
tion in international security affairs. As 
noted in my first National Security 
Strategy Report, this transition really 
began in the late 1970s when our pol- 
icies to rebuild our allies' economies 



had long since succeeded, and America 
no longer held an overwhelmingly pre- 
dominant economic position vis-a-vis 
Western Europe and East Asia. This 
realignment of economic strength is 
Hkely to continue into the next decade 
with the further evolution of East 
Asia's industrial economies, particularly 
that of China. 

This transition period has also been 
marked by the Soviet Union's massive 
military buildup — consuming as much 
as 15-17 percent of annual GNP. This 
large, unmatched investment provided 
the Soviets by the 1980s a position of 
strategic nuclear parity, quantitative 
conventional force superiority around 
the Eurasian rimland, and a modern, 
globally deployed navy. The buildup has 
also supported the projection of Soviet 
influence into many areas of the 
world — particularly the unstable Third 
World regions of Southeast and South- 
west Asia, Africa, and Latin America. 
The buildup's consequences will con- 
tinue to present a major threat to our 
security and that of our allies for years 
to come. 

Two other major trends charac- 
terize this period of transition in inter- 
national security affairs. The first is the 
revolution in military technology that is 
already well underway. New sur- 
veillance and targeting systems, new 
means of destruction, and low observ- 
able (stealth) technology will soon pro- 
vide military capabilities previously 
thought wholly infeasible. Similarly, 
rapid advances in microelectronics will 
allow the command, control and com- 
munications, integrated with intel- 
ligence sources to provide the 
necessary strategic and tactical direc- 
tion of such advanced military 
operations. 

Our military leaders, as well as 
those of our adversaries, are now re- 
thinking military doctrines and force 
structures as a result of these and 
other applications of advanced tech- 
nology to military power As this trend 
continues, military competition is likely 
to focus increasingly on non-nuclear 
weapons, where the combinations of 
stealth and extreme accuracy at long 
ranges will reopen the possibility of 
non-nuclear strategic attack. Space will 
also become a more prominent area of 



activity, not the least because of its 
growing importance for air, ground, 
and naval warfare. We expect that this 
revolution in military technology will 
continue well into the next decade and 
necessitate the adaptation both of mili- 
tary doctrines and of national security 
strategies. In this regard, the recent 
report of the bipartisan Commission on 
Integrated Long-Term Strategy helps 
bring into focus the essentiality of 
maintaining our technological superi- 
ority through coherent military re- 
search and development programs 
aimed at exploiting emerging strategic 
opportunities. 

The last major trend of this transi- 
tion period is the diffusion of economic 
power and advanced technology to the 
Third World. This combination of eco- 
nomic growth and technological matura- 
tion has already provided several 
countries with an independent ca- 
pability to produce large numbers of 
advanced weapons systems, both for 
their own use and for export. Thus, 
countries dependent on neither the 
United States nor the Soviet Union 
could in the not too distant future pos- 
sess the capability to conduct a major 
war, either against each other or 
against a world power. The arsenals at 
the disposal of these sovereign coun- 
tries are likely to include chemical 
weapons, and may eventually include 
nuclear weapons and space systems for 
target location. As this trend con- 
tinues, the potential for mid- and high- 
intensity conflict increases in many re- 
gions of the world, some of which are 
already suffering from various types of 
low intensity conflict. 

In responding to these emerging 
features of the strategic landscape, we 
have formulated our strategies to play 
to our strengths and to exploit our ad- 
versaries' weaknesses. For example, 
our defense policies stress that the 
United States and its allies must con- 
tinue to enjoy technological superiority 
over the Soviet Union. The West's spirit 
of inquiry and the free flow of informa- 
tion permit technology and innovation 
to flourish to a far greater degree than 
in a closed society. Our advantages in 
areas such as precision guided muni- 
tions, stealth technology, submarine 



quieting, and super-computer tech- 
nology are important strategic assets 
and we intend to exploit them, and to 
protect them from Soviet attempts to 
acquire them — either by purchase or 
theft. 

In a similar manner, our diplomatic 
policies are designed to play to the 
strength of our alliance relationships. 
In Europe, we and our NATO allies are 
partners in a voluntary coalition of sov- 
ereign, equal nations — in stark contrast 
to the Warsaw Pact and the Eastern 
European countries still dominated by 
Soviet military power. In this period of 
transition we have new opportunities as 
our allies display an increasing willing- 
ness to seek a larger role in providing 
for Western European defense. We wel- 
come this trend, knowing we are work- 
ing from the strength of an abiding 
alliance partnership, and that increas- 
ing allied contributions are important 
to assuring the Alliance's long-term ef- 
fectiveness and viability. 

But the period of transition is not 
over; and administrations after mine 
will continue to adapt strategic con- 
cepts and policies to the realities of an 
evolving world — one in which America 
must always play a leading role, to help 
shape a positive future for ourselves 
and our allies. 

The remainder of this section dis- 
cusses the fundamental policies — diplo- 
matic, economic and defense — that 
guide our use of the elements of na- 
tional power as we formulate strategy. 
These policy guidelines provide co- 
herence and consistency among the set 
of integrated strategies which are dis- 
cussed in the chapter that follows. 



U.S. DIPLOMATIC POLICY 

Policies to Move America Forward 

As I have stated on many occasions, 
our diplomacy has aimed at ensuring, in 
the nuclear age, both peace and free- 
dom. Working with our allies and 
friends, we have sought to push beyond 
the stalemates of the postwar era and 
directly confront two transcendent is- 
sues affecting our national security — 
the danger of nuclear warfare and the 



continuing expansion of totalitarian 
rule. 

In deahng with the nuclear thre 
we have gone beyond traditional arn 
control and, together with our NAT 
allies, have sought verifiable reductiki 
in nuclear arsenals. At the same tin'i 
we have launched a new program of 
search into ways to defend ourselve: 
against ballistic missile attack. In d | 
so, we seek to maintain deterrence 
while moving away from reliance on - 
taliation, and toward a situation in 
which ballistic missiles will ultimati 
be rendered obsolete. 

While we have sought arms red • 
tions and greater reliance on defens i 
measures, we have never lost sight 
the fact that nations do not disagre 
because they are armed; they are 
armed because they disagree on vei 
important matters of human life an' 
liberty. The fundamental difference 
tween totalitarian and democractic 
remain. We cannot gloss them over 
can we be content with accepted 
spheres of influence, a world only I 
free. Thus, we have sought to adva 
the cause of freedom where oppor- 
tunities exist to do so. Sometimes i 
means support for liberalization; sc 
times support for liberation. 

In regional conflicts, for examp 
we have elaborated a policy of help 
anti-Communist insurgents in theii 
tie to bring self-determination, ind 
pendence, and human rights to the 
own countries. This doctrine was fi 
reflected in our decision to assist tl 
people of Afghanistan in their fighl 
against Soviet invasion and occupal 
It was an important part of our dei 
sion to assist the people of Nicarag 
their battle to restore the integrity 
their 1979 revolution and make the 
Sandinista government keep its pr< 
of democratic rule. Our current eff 
in Angola in support of freedom fif 
ers constitute the most recent ext« 
sion of this policy. 

Undergirding all of this is our 
tinuing commitment to public cand 
about the nature of totalitarian ml 
the ultimate objectives of U.S. fori 
policy: peace, yes, but world freed 
as well. We refuse to believe that i 



Department of State Ell 



FEATURE 
National Security 



3i!how an act of hostility to proclaim 
ulicly the crucial moral distinctions 
eteen democracy and totalitarianism. 

nirmational Support to 
Hiomatic Power 

Vi^.re faced with a profound challenge 
3 ir national security in the political 
- This challenge is to fight the war 

■as and to help support the political 
■J structure of world democracies, lb 
ct nplish this we must be as commit- 
ii the use of the informational as- 
; I if our diplomatic power as to the 
i ■ elements which comprise it. 
Here in the United States, pubhc 
ip on polls consistently find that, de- 
le ing on the issue, up to two-thirds of 
hi \merican electorate normally take 
w iterest in foreign policy. Moreover, 
in a slight majority of Americans to- 
la believe that this country needs to 
L an active part in world affairs. 
n e is no natural domestic constitu- 
in for America's foreign policy — we 
D! : build one. 

The agencies which we use to imple- 
n t such an approach include the De- 
)8 ments of State and Defense, Agency 
" ntprnational Development (AID), 
IS. Information Agency (USIA), as 
a- several less traditional partici- 
ticluding the Departments of 
ice and Treasury, and the U.S. 
■epresentative (USTR). All con- 
1 our Public Diplomacy and re- 
ifiirmational programs. 
Another important way of achieving 
'1 is through the private sector. During 
past seven years, we have encour- 
1 the American private sector to be- 
le a key element in the projection of 
■. foreign policy goals. Leading pri- 
I citizens and groups have taken 
ps to identify and organize the many 
1 forces throughout America that 
e a direct stake in our nation's rela- 
is with the rest of the world. These 
'ate voluntary organizations are doing 
ndispensable job of public education, 
y have our strongest encouragement 
support. 
' While we focus on the needs of an 
active diplomatic and informational 
cy, we must keep in mind that the 



Soviet Union is pursuing a very ag- 
gressive public deception and propa- 
ganda program, using a wide range of 
techniques aimed not only at the Third 
World, but also at us and our alliance 
partners. The challenge is to counter So- 
viet propaganda and so-called "active 
measures" using the full range of our 
informational programs to tell the truth 
about American values, interests, and 
policies. 



. . . our diplomacy has aimed 
at ensuring, in the nuclear age, 
both peace and freedom. 



Our political and informational 
power must also reach to the peoples of 
denied areas, particularly the U.S.S.R. 
and Eastern Europe — to encourage hope 
for the change and to educate publics on 
the benefits of free institutions. We un- 
dertake this through the electronic me- 
dia, written materials, increased 
contracts and the exchange of ideas that 
come from such contacts. Any process of 
change must find its roots within a 
closed society, but knowledge of the 
world at large may be a stimulant; and 
the free flow of ideas and information is, 
in itself, one of the goals of those who 
seek democratic change. For our part, 
we proceed from our fundamental belief 
that a world composed of free, sovereign 
democracies will be a safer, more stable 
world — one where respect for the dignity 
of all people has a better chance to be 
realized. 



U.S. ECONOMIC POLICY 



International Economic Policy 

U.S. national power rests on the 
strength of our domestic economy. A 
growing, resilient and technologically 
vigorous economy is vital to our national 
security. In peacetime it is the funda- 
mental underpinning of our national de- 
fense capabilities. In a crisis or during 
wartime it provides the ability to re- 



spond rapidly with skilled personnel, ex- 
panded production capacity, and supplies 
of critical materials. World Wars I and II 
demonstrated the vital importance of a 
strong domestic economy able to produce 
quickly and efficiently the goods needed 
to defend ourselves and our allies. 

Our economic strength has domestic 
and international dimensions, although 
the distinctions are neither easy nor 
rigid. Domestically, it is in our national 
security interest to maintain a dynamic 
research and development capabiUty 
which enables us to be in the forefront of 
technological advance. Our manufactur- 
ing sector must remain competitive with 
those in other leading industrial coun- 
tries. Our financial and service indus- 
tries must provide up-to-date tools for 
the continued growth of our economy. 
Other sectors of the economy, such as 
energy and transport need to be of suffi- 
cient size and diversity to provide a criti- 
cal nucleus should we need to respond to 
an emergency. Finally, our labor force 
is — and will remain — a key element of 
our economic strength. An innovative, 
adaptive and educated labor force re- 
mains essential to the development of 
new technologies, the continued growth 
of our economy and the production of 
competitive goods. 

While mindful of the need for a 
strong domestic economy, we do not — 
and should not — strive for domestic eco- 
nomic self-sufficiency or for dominance in 
all economic sectors. Market economies 
are interdependent. Since 1945, we have 
pursued a vigorous policy, first, of help- 
ing rebuild the European and Pacific 
economies devastated by war; and sec- 
ond, of supporting economic cooperation 
and development among all Free World 
economies. We strongly believed then — 
as we do now — that national economic 
strength is a shared strength. For exam- 
ple, we support European efforts at eco- 
nomic integration through the European 
Community because we believe that a 
strong European economy will be better 
able to contribute the resources neces- 
sary for a strong Alliance defense. Like- 
wise, the Free Trade Area Agreement 
recently negotiated with our largest 
trading partner, Canada, directly and 
positively contributes to our collective 



11(1988 



security in North America. Just as our 
defense depends on the cooperation and 
participation of our alhes, so does our 
economic prosperity. Thus our economic 
objectives in support of our security pol- 
icies are necessarily global. However, 
one central consequence of our interde- 
pendence is that we cannot dictate eco- 
nomic policy but must consult and 
negotiate, recognizing the realities of 
mutual dependence. 

As the world's leading economic 
power, we have a responsibility by our 
actions at home to help sustain and ex- 
tend the global economic recovery. The 
unprecedented peacetime e.xpansion of 
the American economy since 1982 pro- 
vides a vivid demonstration of the power 
and creativity that free entei-prise can 
unleash. However, the United States has 
not accomplished this alone. Interna- 
tional flows of people, capital and goods 
have enabled us to improve our standard 
of living far beyond that which would 
have resulted from a closed economy. In 
return, American technology, capital and 
goods have enabled other countries to 
improve their economies. Our success 
also provides constructive examples of 
the benefits of open societies and econo- 
mies. At home we must implement eco- 
nomic policies that continue to promote 
growth, while holding down inflation and 
reducing the federal deficit by controlled 
government spending. The budget com- 
promise which we reached late last year 
with the leaders of the Congress is an 
important step toward those ends. Lim- 
iting the cost of central government will 
allow resources to be more productively 
used by the private sector By reducing 
the federal deficit and promoting private 
saving, we can reduce undue dependence 
on inflows of foreign capital and play a 
stronger role in providing capital to sup- 
port growth on the global economy. 

A natural consequence of societies' 
striving to grow and be competitive in 
the world economy is periodic tension 
manifested in trade disputes and other 
bilateral economic difficulties. The 
United States, as the leading proponent 
of an open international trading system, 
has led in the construction of the present 
General Agreement on Tariffs and Trade 
(GATT) system, which has promoted 
over the years a vigorous expansion of 



trade to the benefit of all. We are now 
seeking to strengthen that system and 
bring it up to date. We strongly support 
the Uruguay Round of multilateral trade 
negotiations which aims further to re- 
duce barriers to global trade. For the 
first time, agriculture, intellectual prop- 
erty rights, trade in service (such as 
banking, insurance and transportation), 
and investment will be the focus of seri- 
ous negotiation. 

History has shown that free, open 
economies with unrestricted trade are 
strong economies, which grow faster and 
have the resources with which to defend 
themselves. Open trade and cooperation 
among nations also help to cement al- 
liances which in turn bolsters our coali- 
tion defense efforts. The challenge to the 
United States now is to avoid letting ten- 
sions and disputes over trade issues un- 
dermine domestic support for free trade, 
or become a catalyst for policies which 
only serve to reduce overall economic 
growth, and thus work in opposition to 
our security objectives. In this regard, 
we must actively resist the temptation to 
impose protectionist measures in order 
to cope with trade imbalances, while res- 
ponding to the legitimate concerns of 
U.S. industry about the unfair trade 
practices of other countries. Protec- 
tionist trade legislation would be a major 
threat to our economic health, to eco- 
nomic and political relations with our al- 
lies, and to our collective economic and 
military strength. 

There are times, however, when we 
must restrict economic relations between 
the United States and other countries 
not only for reasons of national security, 
but to protest odious national behavior. 
By restricting economic relations, we 
seek vigorously to persuade the target 
country that its behavior is unaccept- 
able. For example, U.S. economic lever- 
age is employed against nations that 
threaten regional stability or support 
international terrorism, such as Cuba, 
Libya and Nicaragua. However, eco- 
nomic sanctions are never imposed with- 
out careful consideration, as they 
inevitably impose costs on American 
business as well as foreign clients. For 
that reason our policy will continue to be 
to use them sparingly, and only continue 
them when their need and effectiveness 
can be clearlv demonstrated. 



Energy is an important underpir '■ 
ning to our economic, industrial and ijj 
tary strength, and thus to our nation K 
security. Over the long term, our na- 
tional energy policy is aimed at ensui r 
adequate supplies of energy at reasoi 
able prices by strengthening domesti 
energy industries, diversifying energ 
sources, and improving energy effi- 
ciency. We are working through the 1 
ternational Energy Agency to assist 
allies to develop complementary stra 
egies. More immediate objectives art i 
reduce the nation's vulnerability to d 
ruptions in foreign energy supplies 
to lessen the impact on the civil ecu 
if disruptions should occur. This inc' 
plans for increasing the size of the ,- 
tegic Petroleum Reserve, promotini. 
ternational cooperation with allies ar 
partners in the International Energ) 
Agency, and encouraging research in 
economically viable technologies that ■ 
crease energy efficiency or that mak 
use of alternative sources of power 

Internationally, we have led in t 
coordination of economic policy amoi 
the major industrialized countries. li n 
dition, we will continue to assist dt'\ 
ing countries to realize sustained, ii 
inflationary growth, since we undei- 
that this is in our mutual economic :i 
security interest. We will encourage 
effective adjustment process for debi 
nations, supported by adequate pri\; 
and public financing. To help debtor 
countries, we have expressed our \\ 
ingness to negotiate additional resm 
for the World Bank. The United St:, 
has welcomed a proposed enlargeni' 
the IMF's [International Monetary i 
Structural Adjustment Facility. We 
have proposed a broadened IMF far 
to provide a financial cushion for vul 
nerable developing countries dealine 
with the vicissitudes of external eco 
nomic forces. 

As noted earlier, our nation's '1 
fense edge is based on technologic 
rather than numerical superiority, 
lose this edge, we also lose an essi 
element of our military deterrent. 
There is concern that the loss of a<i 
vanced production capabilities in cr- 
cal industries could place our defen 
manufacturing base in jeopardy. Wi 
must avoid situations where increa.- 1 



10 



Department of State Butir 



FEATURE 
National Security 



Ki' on other countries for advances 
tieal technologies could, over the 
:erm, turn into vulnerabilities. 
■\irthermore, the fruits of the free- 
et economy must not strengthen 
lilitary capability of our adversar- 
\'e. as well as our allies, must 
lue to ensure that economic rela- 
lips with the Soviet bloc do not 
Ml our national security. For ex- 
■, we have reached agreement on 
latmg preferential credit terms to 
i\ ut Union. Working through the 
lational Energy Agency, we and 
Hits have reduced the substantial 
f Western European dependence 
viet energy. Acting with our allies 
gh the Coordinating Committee 
unilateral Export Controls 
OM), we are making progress to- 
ensuring that militarily sensitive 
ology does not flow to the Soviet 
1 and that competitor firms in 
)M member nations bear the same 
t restrictions as U.S. firms. We 
ontinue to improve the COCOM 
V process, to harmonize and 
'n national licensing and enforce- 
pnicedures, and to encourage 
■r cooperation with allies and 
is The dual objectives of protect- 
1(1 sharing militarily significant 
nliitjies pose a challenge, one 
till ire difficult by rapid tech- 
ieal changes. But it is a challenge 
ust meet. 

Ve willingly offer our philosophy of 
Tiarket economies to centrally 
! regimes. Indeed, it is only by 
market mechanisms that these 
an satisfy the economic needs 
' es of their peoples. However, 
■tonomies only flourish where 
I mi and individual rights are en- 
ised. The IMF, GATT and other 
national economic institutions are 
ly concerned with improving rela- 
aiiiong free individuals, busi- 
s and financial institutions. While 
111' recent Soviet policy statements 
liiiig "reconstruction" and eco- 
c leform, the Soviet economic 
ni remains at this point fundamen- 
iiicompatible with participation in 
World institutions. Policy state- 
s must be translated into positive 
ns before such participation can be 
dered. 



U.S. DEFENSE POLICY 



A Policy of Deterrence 

The third element of U.S. national 
power is military. In some cases, the 
integrated use of the other elements of 
national power will be insufficient to 
meet the threats to our security inter- 
ests. We therefore must be — and are — 
ready to employ military power in coor- 
dination with the other elements. How- 
ever, the ultimate goal when applying 
mihtary force, or projecting military 
power, is to encourage political solu- 
tions. War is the least desirable alter- 
native, but only by being prepared to 
wage war successfully can we deter it. 

America's defense policy through- 
out the postwar period has been aimed 
at deterring aggression against the 
United States and its allies. Deterrence 
works by persuading potential adver- 
saries that the costs of their aggression 
will exceed any probable gains. Deter- 
rence is the basis of our military strat- 
egy against conventional as well as 
nuclear aggression. Because any con- 
flict carries the risk of escalation, our 
goal is to dissuade aggression of any 
kind. 

We seek also to prevent coercion of 
the United States, its allies, and 
friends. Successful coercion could give 
a hostile power the benefits of victory 
without the cost of war. As discussed 
earlier, the Soviet threat manifests it- 
self not only in the danger of an actual 
attack, but in the form of propaganda, 
intimidation and coercion as well. The 
Soviets still seek to dominate Western 
Europe and Japan without having to 
fire a shot — a coercive threat which 
must and will be deterred by our politi- 
cal determination, our defense ca- 
pabilities, and our alliance 
relationships. 

To deter the Soviet Union, we must 
make clear to its leaders that we have 
the means and the will to respond ef- 
fectively to coercion or aggression 
against our security interests. While 
emphasizing our resolve to respond, our 
policy is to avoid specifying exactly 
what our response will be. This is the 
essence of our strategic doctrine of 
"flexible response," which has been 
United States policy since 1961 and 



NATO strategy since 1967. Specifically, 
our forces deter a potential aggressor 
by confronting him with three types of 
possible responses from which we could 
choose at the appropriate time: 

• Direct Defense: To confront an 
adversary with the possibility that his 
aggression will be stopped without our 
resorting to actions which escalate the 
conflict. This is sometimes referred to 
as "deterrence through denial." Defeat- 
ing a nonnuclear attack with conven- 
tional forces only would be an example 
of direct defense. 

• The Threat of Escalation: To 
warn an adversary that his aggression 
could start hostilities that might not be 
confined in the manner he hopes or en- 
visions and that escalation could exact 
far greater costs than he anticipates, or 
could bear. In this regard, NATO's de- 
terrence of a Soviet conventional attack 
is enhanced by our ability and resolve 
to use nuclear weapons, if necessary, to 
halt aggression. 

• The Threat of Retaliation: To 
raise the prospect that an attack will 
trigger a retaliatory attack on the ag- 
gi-essor's homeland, causing his losses 
far to exceed any possible gains. Our 
deterrence of a Soviet nuclear attack on 
the United States is based on our re- 
solve to retaliate directly against the 
Soviet Union. 

Maintaining Strategic Deterrence 

While deterrence requires capabihties 
across the entire spectrum of conflict, 
its essential foundation is provided by 
our strategic nuclear forces and the 
doctrine which supports them. Nuclear 
deterrence, like any form of deter- 
rence, requires us to consider not what 
would deter us, but what would deter a 
potential attacker, particularly one 
whose perceptions of the world and 
value system are substantially different 
from our own. Since we can never be 
entirely certain of Soviet perceptions, 
we must ensure that both the effective- 
ness of our strategic forces and our will 
to use them, if necessary, are never in 
doubt. 

In the interest of ensuring deter- 
rence, the United States maintains di- 
versified strategic retaliatory forces to 
hedge against a disarming first strike. 



1988 



11 



to complicate Soviet attack plans, and 
to guard against technological surprise. 
To this end we maintain a variety of 
basing modes, launch platforms, and at- 
tack vehicles, achieving diversity 
through a triad of submarine launched 
ballistic missiles (SLBMs), interconti- 
nental ballistic missiles (ICBMs) and 
bombers. Adequate and survivable com- 
mand, control and communications are 
essential to our strategic force struc- 
ture and critical to the credibility of our 
strategic deterrent. 

Our strategic forces and the associ- 
ated targeting policy must, by any cal- 
culation, be perceived as making 
nuclear warfare a totally unacceptable 
and unrewarding proposition for the So- 
viet leadership. Accordingly, our tar- 
geting policy: 

• Denies the Soviets the ability to 
achieve essential military objectives by 
holding at risk Soviet warmaking ca- 
pabilities, including both the full range 
of Soviet military forces and the war- 
supporting industry which provides the 
foundation for Soviet military power 
and supports its capability to conduct a 
protracted conflict; and 

• Places at risk those political en- 
tities the Soviet leadership values most: 
the mechanisms for ensuring survival of 
the Communist Party and its leadership 
cadres, and for retention of the Party's 
control over the Soviet and Soviet-bloc 
peoples. 

This basic policy of targeting those 
assets which are essential to Soviet 
warmaking capability and political con- 
trol has been an integral part of U.S. 
strategy for many years. In implement- 
ing this policy, the United States does 
not target population as an objective in 
itself and seeks to minimize collateral 
damage through more accurate, lower 
yield weapons. 

Holding at risk the full range of 
Soviet assets is necessary for an effec- 
tive deterrent, but is not sufficient. As 
President, I cannot be limited to the 
options of capitulation or massive mu- 
tual destruction in response to aggres- 
sion. We must have flexibility in the 
employment of our strategic forces. For 
our deterrent to be credible, it must be 
clear to the Soviets that the United 



12 



States has military options appropriate 
to a broad range of plausible situations. 

Finally, the United States requires 
sufficient residual capability to provide 
leverage for early war termination, and 
to avoid coercion in a post-conflict 
world. For this reason, we maintain a 
nuclear reserve force as an integral 
part of our strategic forces. In addition, 
we maintain Continuity of Government 
programs to ensure the Soviets cannot 
escape retaliation by initiating a quick, 
"decapitating" attack aimed at inca- 
pacitating our political and military 
leadership. Our civil defense program 
also contributes to the Nation's pre- 
paredness in the event of an attack. 

These capabilities do not imply that 
we seek the ability to fight a nuclear 
war. I have repeatedly emphasized that 
a nuclear war cannot be won and must 
never be fought. But we must deter an 
adversary who has a very different 
strategic outlook from our own — an out- 
look which continues to place great 
stress on nuclear warfighting capability. 
It is essential the Soviets understand 
that they cannot gain their objectives 
through nuclear warfare, or nuclear co- 
ercion, under any conceivable 
circumstances. 

Our policy of flexible response and 
deterrence through the threat of offen- 
sive retaliation has preserved the se- 
curity of the United States and its 
allies for decades. Looking to the fu- 
ture, the Strategic Defense Initiative 
offers an opportunity to shift deter- 
rence to a safer and more stable basis 
through greater reliance on strategic 
defenses. Such defenses, which 
threaten no one, would enhance deter- 
rence by injecting greater uncertainties 
into Soviet estimates of their ability to 
achieve their military objectives should 
they attempt a first strike. Even less 
than perfect defense could increase sta- 
bility by denying the Soviets confidence 
that they could achieve meaningful mili- 
tary goals, thereby eliminating incen- 
tives for a Soviet first strike. In 
judging the suitability of systems for 
possible deployment, we will continue 
to be guided by the criteria of military 
effectiveness, survivability, and cost-ef- 
fectiveness at the margin. 



By reducing the military value c ; 
ballistic missiles, strategic defenses 
would facilitate Soviet acceptance of i; 
significant arms reduction agreemen,,' 
In a world with fewer ballistic missi |" 
however, Soviet incentives to not abi., 
by such agreements would be greate , , 
Strategic defense can effectively nej j 
such incentives by eliminating the u ,, 
ity of covertly stockpiled missiles. T l 
enhanced strategic defenses offer th ,1 
prospect of a safer, more stable wor 
in which deep reductions in strategi 
offensive arms are both negotiable y 
enforceable. We will continue to try 
persuade the Soviets to join with u- 
working out a stable transition to tl 
desirable goal. 

Continuing the modernization o 
our strategic forces is essential to a 
sure rehable deterrence, enhance st 
bility, and to provide motivation for e 
Soviets to negotiate broad, deep, ec ■ 
table and verifiable reductions in st 
tegic offensive arms. While we are 
firmly committed to using arms red 
tions as one component of our polic ci 
enhancing U.S. and allied security, c 
cess in arms negotiations does not ; r 
the need for modern, effective, sur a> 
ble nuclear forces to provide deter- 
rence, promote stability, and hedge 
against Soviet cheating or abrogati- 
Nor does it eliminate the need for ; 
nuclear weapons production complt 
capable of supporting such weapon; i 
the future. Neglecting modernizati( ii 
expectation of arms reduction agrei 
ments would actually decrease the V 
lihood of such agreements by reducff 
Soviet incentives to negotiate. ' 

For their part, the Soviets con I* 
to invest heavily in accurate, fast-f J 
ballistic missiles which can destroy 
hard targets. Their goal has been, 
remains, an effective disarming fin 
strike capability. Moreover, they ar 
continuing to enhance their ICBM 
vivability through silo hardening ai 
mobility, including deployment of t 
road-mobile SS-25 and the rail-bas« 
SS-24. At the same time, they inve 
roughly the same amount in their 5 
tegic defense programs as in their 
fensive force modernization. They 
expanding and improving the work 
only deployed anti-ballistic missile 



Department of State Bu 



FEATURE 
National Security 



AM) system, violating the ABM 
frity with construction of their radar 
itijasnoyarsk and other radar deploy- 
Tlt ts, and increasing their capability 
;o'eploy a territorial ABM defense. 
Pf ir vast growing network of deep un- 
l€ cround leadership shelters is aimed 
r nsuring the survival of Communist 
. y control over the Soviet nation, 
»c lomy, and military forces in war. 
n ir strategic communications are 
li ily redundant, survivable, and hard- 
a i against nuclear effects. 
' In response to the buildup of So- 
capabilities, the United States is 
inning the Strategic Modernization 
t" ^ram in order to maintain the 
Bi mtial survivability and mission- 
si ctiveness of our own forces. The So- 
vi s' active and passive defenses, their 
1)1 dup of offensive forces, and their 
p lished doctrine all continue to pro- 
V > evidence of Soviet nuclear war- 
Si ting mentality, and underline the 
B: >ntiality of maintaining an effective 
1 1. deterrent through support for this 
h lest priority defense program. 

i ns Reductions 

I ns control is not an end in itself, but 
y one of several tools to enhance our 
r ional security. Our arms reductions 
ectives are fully integrated with our 
r, ional security poUcies to enhance de- 
t rence, reduce risk, support alliance 
r ati(jnships, and ensure the Soviets do 
r gain significant unilateral 
i /antage. 

Based on this view of arms control 
i a complement to a strong national 
<fense posture, we have been guided 
J ce the beginning of this Administra- 
t n by several fundamental principles: 

• The United States seeks only 
)se agreements which contribute to 

'r .'iecurity and that of our allies. 

• The United States seeks agree- 
'nts which reduce arms, not simply 
lit their increase. 

• Achieving verifiable agreements 
bmad, deep and equitable reductions 
offensive nuclear arms is the highest 
ms control priority of the United 
ates. 



• Within the category of offensive 
nuclear arms, the United States gives 
priority to reducing the most destabiliz- 
ing weapons: fast-flying, non-recallable 
ballistic missiles. 

• The United States also seeks 
equitable arms control measures in the 
area of nuclear testing, chemical weap- 
ons and conventional forces. 

• The United States insists on 
agreements that can be effectively ver- 
ified and fully complied with. Arms 
control agreements without effective 
verification measures are worse than no 
agreements at all, as they create the 
possibility of Soviet unilateral advan- 
tage, and can affect U.S. and allied 
planning with a false sense of 
confidence. 

Our perseverance in adhering to 
these principles paid off on Decem- 
ber 8, 1987, when Soviet General Secre- 
tary Gorbachev and I signed a treaty 
on Intermediate-Range Nuclear Forces 
(INF) eliminating all U.S. and Soviet 
ground-launched ballistic and cruise 
missiles and their launchers, with 
ranges between 500 and 5,500 kilo- 
meters. The INF agreement is an 
important tribute to NATO solidarity, 
persistence, and political courage. 

The Soviet Union, because of its 
massive buildup, is required by the 
treaty to eliminate an INF missile force 
capable of carrying four times as many 
warheads as the United States. Thus, 
the treaty establishes the important 
principle of asymmetry in arms reduc- 
tion agreements, to compensate for 
large Soviet quantitative advantages. It 
is noteworthy that the systems the So- 
viets must eliminate are primarily 
based within the Soviet Union, where 
they are not particularly vulnerable to 
conventional attack in a possible 
NATO-Warsaw Pact conflict. In con- 
trast, the U.S. systems to be elimi- 
nated are high priority targets for 
Soviet conventional attack. Finally, the 
Soviet systems eliminated, particularly 
the shorter-range INF missiles, have 
chemical and conventional as well as 
nuclear capabilities, and could be em- 
ployed against NATO bases and forces 
during non-nuclear phases of a NATO- 
Warsaw Pact conflict. 



The military benefits of the INF 
Treaty will be even greater if we suc- 
ceed in negotiating a treaty on strate- 
gic arms reductions. An agreement 
which significantly reduces strategic 
systems will lessen Soviet capability for 
a first strike, inhibit their ability to use 
intercontinental weapons against thea- 
ter targets, and substantially increase 
the Soviets' uncertainty of accomplish- 
ing their political ends through military 
means. 

While reducing the Soviet threat 
the INF Treaty does not alter NATO's 
basic approach to deterrence. NATO's 
strategy of flexible response continues 
to demand a strong allied nuclear ca- 
pability. Fears that an INF agreement 
will somehow decouple the defense of 
Europe from the U.S. nuclear arsenal 
are based on fundamental misunder- 
standings of the U.S. commitment and 
capability to participate in the defense 
of Europe. The United States retains 
substantial nuclear capabilities in Eu- 
rope to counter Warsaw Pact conven- 
tional superiority, and to serve as a link 
to U.S. strategic nuclear forces. NATO 
aircraft will continue to have the ca- 
pability to hold at risk a broad range of 
targets, including those within the So- 
viet homeland. In addition, U.S. sea- 
based forces assigned to NATO will 
continue to provide AUiance authorities 
with a comparable targeting capability. 
Thus, the Soviets can be under no illu- 
sion that they could attack NATO with- 
out placing their own territory at risk. 

Eliminating an entire class of 
ground-launched missiles, while an 
achievement of historical proportions, 
does not remove the large Soviet con- 
ventional and chemical threat to Eu- 
rope. The next NATO priority for arms 
control, therefore, is to redress existing 
imbalances in conventional and chemical 
warfare capabilities which favor the So- 
viet Union. Recognizing this, the Al- 
liance Foreign Ministers meeting in 
Reykjavik, Iceland in June 1987 called 
for a coherent and comprehensive con- 
cept of arms control which reduces re- 
maining European-based nuclear forces 
only in conjunction with the establish- 
ment of a conventional balance, and the 
global elimination of chemical weapons. 
I fully support this approach. 



tril 1988 



13 



The most important unfinished 
arms control task is to achieve deep 
reductions in strategic offensive arms. 
Both we and the Soviets have intro- 
duced draft texts for strategic arms re- 
duction treaties (START). Our approach 
provides for specific restrictions on the 
most destabilizing systems — fast-flying 
ballistic missiles, especially heavy So- 
viet ICBMs. We are pursuing a goal 
first agreed to in October 1986 and re- 
affirmed during the December 1987 
Summit: a 50 percent reduction in stra- 
tegic offensive forces to a total of 6,000 
warheads and 1,600 delivery vehicles. 
We are negotiating seriously; if the So- 
viets are willing to match our seri- 
ousness, agreement is possible. At the 
same tirhe, a bad agreement is worse 
than no agreement, and we will not ac- 
cept any agreement which does not en- 
hance our security. 

We are also engaged in a wide vari- 
ety of arms negotiations and discus- 
sions on other subjects. The U.S. 
approach to all of these areas is consis- 
tent; we seek only those agreements 
which are equitable, verifiable, and will 
enhance our security and that of our 
allies. Specifically: 

• Consistent with our belief that 
strategic defenses may offer a safer, 
more stable basis for deterrence, we 
seek Soviet agreement for an orderly 
transition to a more defense-reliant 
world. 

• We seek an effective and verifia- 
ble global ban on chemical weapons. 

• We seek alliance-to-alliance nego- 
tiations to establish a more secure and 
stable balance in conventional forces at 
lower levels from the Atlantic to the 
Urals. Any steps ultimately taken in 
this area must be effectively verifiable 
and must recognize the geographic and 
force asymmetries between the two 
sides. Alliance policy in this regard, 
which we fully support, is quite clear — 
increased security and stability, not re- 
ductions per se, are the objectives of 
Western conventional arms control 
efforts. Given the Warsaw Pact's con- 
ventional superiority in certain key 
areas — particularly those important for 
offensive operations — even modest re- 
ductions in NATO forces, in the ab- 
sence of larger reductions from the 



14 



Warsaw Pact, would reduce NATO's se- 
curity and would not promote stability. 
The challenge is to synchronize NATO's 
force improvement plans and conven- 
tional arms control efforts toward the 
long-term goals of increased security 
and stability. 

• In the area of nuclear testing, on 
November 9, 1987, we began formal ne- 
gotiations with the Soviets on essential 
verification improvements to permit 
ratification of e.xisting treaties: the 
Threshold Test Ban Treaty, and the 
Peaceful Nuclear E.xplosion Ti-eaty. 
Once our verification concerns have 
been satisfied and the treaties ratified, 
we would be prepared immediately to 
engage in negotiations with the Soviets 
on ways to implement a step-by-step 
program to limit and ultimately end nu- 
clear testing, in association with a pro- 
gram to reduce and ultimately eliminate 
all nuclear weapons. Until that ultimate 
stage has been reached, however, the 
United States must continue testing to 
maintain a safe and reliable deterrent. 

• Finally, we seek to enhance sta- 
bility through improved measures 
which could prevent misunderstanding. 
To this end, we signed an agreement 
with the Soviets on September 15, 1987, 
to establish Nuclear Risk Reduction 
Centers in each national capital as a 
mechanism to avoid incidents resulting 
from accident or miscalculation during 
periods of tension. 

In all of these areas we consider 
effective verification provisions to be as 
important as specific negotiated limits; 
they must be negotiated concurrently. 
We cannot accept obligations that limit 
our military programs unless we can 
effectively verify Soviet compliance 
with those same obligations. This is 
particularly important in light of the 
continuing pattern of Soviet violations 
documented in the several reports 
which I have submitted to the Congress 
on Soviet non-compliance. 

We have made solid progress in the 
area of arms reductions. Sound agree- 
ments — those that enhance our security 
and that of our Allies — require pa- 
tience, firmness and strength. If we 
continue to display these qualities, and 
if the Soviets are willing to build on the 
progress we have made, arms reduc- 



tions can help keep us on the path to i 
ward greater stability and a safer 
world. In moving to that world, I wil 
maintain my commitment to broad, 
deep, equitable, and verifiable arms i 
ductions, focused especially on ballist' 
missiles, and my equally strong com- 
mitment to the Strategic Defense |i 
Initiative. f 

Maintaining Conventional Deterrer 

Modern strategic nuclear capabilitie.'^ 
are essential for deterrence, but the,\ 
alone are obviously not enough. The 
United States and its allies require 
robust conventional forces, backed b; 
adequate theater nuclear capabilitie.'^ 
as an integral part of our overall det^ 
rent. As noted earlier, U.S. National 
Security Strategy has historically be 
based on the concepts of forward de- « 
fense and alliance solidarity. Consisti i 
with that strategy, we maintain large i 
forward deployed forces at sea and o I 
the territory of our NATO and Asiar 
allies in time of peace. The overall si k 
capabilities, and characteristics of U t 
Armed Forces are strongly influence |r 
by the need to maintain such presen^ I; 
which is essential to deter aggressio 

The most demanding threat wit! 
which those forces must deal is, of 
course, the Soviet Union. Soviet fore 
will always outnumber our own in an 
presently foreseeable conflict — partii 
larly when viewed in terms of active 
forces and major items of combat eqi 
ment. For this reason we must contii 
to give the most careful attention to 
ensuring our forces' technological suj 
riority and high readinesss to accom 
plish their deterrent and warfightin^ 
missions. 

An additional premise of Americ 
defense policy is that the United Sta 
does not seek to deal with the threat 
from the Soviet Union unaided. A sy 
tem of vigorous alliances is essential 
deterrence; and the most important 
these is NATO. The United States C( 
tributes to the NATO deterrent in s« 
eral ways. Most visible is the peaceti 
stationing of over 300,000 military pi 
sonnel in the Alliance area. This sigr 
cant presence of U.S. forces makes x 



Department of State BulH 



FEATURE 
National Security 



[6: that it is not possible to attack a 
</ ally without simultaneously en- 
a{ ig the full military might of the 
ned States. The proximity of major 
/s;aw Pact ground, air and naval 
)r s to Alliance territory, the speed 
il which modern conflict can unfold, 
le 'act's significant numerical advan- 
if i, and the Soviet's strong doctrinal 
iniasis on surprise, all argue for the 
01 nuation of substantial, qualita- 
v y advanced U.S. and allied conven- 

10 .1 forces in Europe. 

In addition to the direct provision 
fjfces, the United States provides 
e< 'ity assistance to those NATO al- 
e! vhose economies do not permit 
111 1 to make as great a contribution to 
111 ommon defense as we and they 
K d wish; and we encourage the more 
ff ent Alliance members to do so as 
K Such assistance serves as an 
n rtant force multiplier — increasing 
the political solidarity and the mil- 
'£ effectiveness of NATO. 

Under NATO military strategy, the 
u based forces of the Alliance na- 
ic ., including the United States, 
^c d have primary responsibility for 

11 ting a Warsaw Pact attack and de- 
51 ing Allied territory, while simul- 

i: ously disrupting and destroying the 
)1 vv-on forces which Soviet strategy 
61 s upon to exploit any initial suc- 
ei3s. Allied ground forces, supported 
V jctical air power, require the ca- 
a lity to halt a Pact attack and re- 
ti ;■ the integrity of Alliance territory 
AT( ) political and military objec- 
; are to be achieved. Absent such 
<4 bility, Alliance strategy becomes 
e ily dependent on the threat of re- 
ing to nuclear weapons to achieve 

Sntial deterrence and warfighting 
ctives. 
i| The capability needed to halt such 
arsaw Pact attack, without risking 
arly transition to nuclear war, is 
principal determinant of the size 
composition of the more than 
000 military personnel we currently 
! forward deployed in Europe. In 
diboration with our allies, U.S. mili- 
tj planners consider the Pact's ca- 
i^ilities, the battle terrain, allied 

ibilities, and NATO strategy when 
BTmining the size, composition, and 



location of our contribution of forward 
deployed forces along the 720 kilometer 
Central front, and on the flanks and 
adjoining seas. 

In addition, certain U.S. forces 
perform functions for the theater that 
are not within the capability of our al- 
lies, such as certain types of reconnais- 
sance and intelligence missions; or they 
provide the capability to receive and 
rapidly deploy reinforcements and re- 
supply received from the United 
States. While marginal changes may be 
feasible in the future, with adjustments 
in the U.S. -allied division of labor, the 
basic U.S. contribution has been care- 
fully planned to assure that the strat- 
egy for the defense of Western Europe, 
and the U.S. contribution to it, are mil- 
itarily effective, and are seen by our 
adversaries to be so. 

In addition to the right numbers 
and mix of units, U.S. and allied forces 
require constant upgrading and mod- 
ernization to retain a qualitative edge 
in the face of the Pact's superior num- 
bers and rapidly improving technolo- 
gies. Our policies relating to force 
modernization and retention of our 
technological edge emphasize coopera- 
tion among the Allies on research, de- 
velopment, and production. This 
approach reduces duplication of R&D 
[research and development] resources, 
shares the best available allied tech- 
nology, promotes interoperable equip- 
ment, and provides incentives for our 
Allies to increase their contribution to 
Alliance capabilities. Congressional ini- 
tiatives aimed at stimulating cooper- 
ative R&D have aided materially in 
advancing these programs. 

NATO's strategy of flexible re- 
sponse requires a capability for Alliance 
reaction appropriate to the nature of 
Soviet provocation. In addition to con- 
ventional forces, this strategy must be 
supported by effective and substantial 
theater nuclear forces. In contrast to 
the policy of the Soviet Union, it is 
NATO's policy to maintain theater nu- 
clear forces at the lowest level capable 
of deterring the threat. In pursuit of 
this policy, the Alliance decided in Oc- 
tober 1983 to reduce the number of 
warheads in Europe. These reductions, 



taken independently of any arms reduc- 
tion agreement, decreased NATO's nu- 
clear stockpile in Europe to the lowest 
level in over 20 years. 'This makes it 
essential that the remaining stockpile 
be modern, survivable, and effective. 

With the prospective removal of 
our INF forces in Europe, it will be 
particularly important that our remain- 
ing theater nuclear forces be fully capa- 
ble of supporting the Alliance's flexible 
response strategy. We have examined 
the military implications of the treaty 
from that standpoint and are confident 
that the resulting force structure will 
provide the necessary military ca- 
pability, provided that necessary force 
modernization continues and that we ef- 
fectively capitalize on available nuclear 
weapons delivery platforms. 

While neither NATO nor the 
United States seeks to match the Sovi- 
ets weapon for weapon, deterrence 
would be dangerously weakened if the 
Soviets were allowed to field a major 
capability which was completely un- 
matched by a countervailing NATO ca- 
pability. This premise underlies our 
determination to modernize the U.S. 
chemical weapons capability through 
development of modern, safe, binary 
munitions. This modernization will pro- 
vide us the capability needed to deter 
Soviet first use of chemical weapons. 
Absent such capability, we will remain 
dependent on a stockpile of obsolescent 
chemical weapons ill-suited to modern 
delivery systems. This places undue re- 
liance on Alliance nuclear capabilities 
to deter Soviet first use of chemical 
weapons — an obviously undesirable and 
risky situation. 

U.S. strategy recognizes that the 
Soviet Union is capable of simultaneous 
aggression in more than one region. 
Should aggression occur in several 
areas simultaneously, U.S. responses 
would be governed by existing commit- 
ments, general strategic priorities, the 
specific circumstances at hand, and the 
availability of forces. Our strategy is 
not to try to fight "everywhere at 
once." We would do what is strate- 
gically sensible and operationally 
achievable under the circumstances. 



11988 



15 



Our capability to respond would be en- 
hanced by the flexibility we have built 
into our force structure, including ca- 
pabilities for global strategic mobility 
and power projection. This visible ca- 
pability to respond effectively in distant 
theaters reduces the risk that we will 
ever have to meet such attacks. 

NATO is not our only alliance. The 
United States has bilateral or multi- 
lateral security commitments with some 
43 nations around the globe, including 
important treaties with Japan, the Re- 
public of Korea, and Australia. 

In support of those commitments, 
and to deter adventurism by the Sovi- 
ets and their client states, we maintain 
forward deployed forces in other re- 
gions of strategic importance. Our naval 
forces deployed in the Pacific and In- 
dian Oceans assist in protecting our 
growing strategic and economic inter- 
ests, and supporting allies and friends, 
in Asia and the Pacific. Substantial 
ground and air forces are deployed in 
Korea to complement forces of the Re- 
public of Korea in deterring aggression 
from the North. Naval and tactical air 
forces deployed throughout the Pacific 
assist in meeting our security commit- 
ments to such nations as Japan and the 
Philippines. 

These global forward deployed 
forces serve several functions. They are 
essential to the creation of regional 
power balances which deter Soviet ag- 
gression and promote overall regional 
stability. They support the political in- 
dependence of nations on the Soviet pe- 
riphery, hence are key to the 
fundamental U.S. security objective of 
avoiding Soviet domination of the Eura- 
sian landmass. Finally, they provide an 
immediately available capability to deal 
with lesser military contingencies. 
However, for military contingencies not 
involving the Soviet Union, we look pri- 
marily to the nations involved to pro- 
vide for their own defense. 

In the past seven years we have 
made substantial progress in improving 
the capability of our forward deployed 
forces to protect U.S. interests, ex- 
ecute our military strategy, and sup- 
port alliance commitments. We remain 



16 



firmly committed to continued improve- 
ment in our deployed capabilities in 
support of our forward-defense, al- 
liance-based strategy. The following 
paragraphs will discuss selected ca- 
pabilities which provide essential foun- 
dations for that strategy. 

Maintenance of Global Support 
and Mobility Capabilities. The ability 
to reinforce and resupply forward de- 
ployed forces is essential to the execu- 
tion of U.S. military strategy. A 
credible U.S. capability to reinforce 
NATO rapidly during times of tension, 
for example, is critical to effective 
deterrence. 

The Soviets have a natural geo- 
graphic advantage in military opera- 
tions on the Eurasian rim, and growing 
capabilities to launch simultaneous of- 
fensives in Europe, Southwest Asia and 
the Far East. Capitalizing on interior 
hues of communication, they can re- 
deploy and resupply forces over a broad 
geographic range. Recent Soviet efforts 
have significantly improved military ac- 
cess by rail and road to strategically 
important areas along the U.S.S.R.'s 
southern frontiers. 

Our global support and mobility ca- 
pabilities, including airlift, sealift, and 
prepositioning, are therefore essential 
to allow us to meet military challenges 
around the periphery of the Eurasian 
continent, which remains the primary 
locus of Soviet expansionist interests. 
Prepositioning ashore or at sea can 
sharply reduce our response times. Air- 
lift, the quickest and most flexible of 
our mobility assets, would deliver ini- 
tial reinforcements in most contingen- 
cies, but sealift will inevitably carry 
the bulk of our reinforcement and re- 
supply, as it has in past crises. Mobility 
capabilities are especially critical to our 
strategy for dealing with contingencies 
in Southwest Asia, where we have no 
military bases or permanently stationed 
military forces. 

Maintenance of an Adequate Lo- 
g:istics Base. To maintain a strong con- 
ventional deterrent, it is vital that we 
provide adequate logistic support for 
U.S. forces. A robust logistics in- 



frastructure strengthens deterrence |, 
demonstrating our preparations for h); 
tilities at any level of intensity, and f |, 
the length of time necessary to defer i, 
U.S. interests. Adequate, sustained n 
support helps raise the nuclear three,, 
old and improves prospects for early |! 
success in conflict. Adversaries mustp 
not conclude that U.S. and allied ca- 
pabilities would be exhausted if con- 1. 
fronted with a complex or prolonged ,, 
military campaign. With the support,. 
Congress we will seek continued im-,^ 
provement in this unglamorous but ( .[ 
sential component of military power, i; 
Concurrently, we will continue to en ., 
phasize to our allies that the sustain i^ 
ment of their forces in combat must i, 
parallel that of our own. '^ 

Maintenance of Adequate Acti' (* 
Forces. Support of our conventional (■ 
terrent requires that we maintain bi B 
anced and effective active duty forc< b 
sufficient in quality and quantity to s 
make our national military strategy M 
credible. In the context of our alliar 
relationships, deterring and, if necf 
sary defeating, the Soviet threat re 
quires a carefully structured mix of 
U.S. and allied land and sea-based 
forces capable of executing the agre 
strategy until reinforced from the n 
speetive national mobilization bases 

While NATO requirements are 
primary focus of our ground forces' j . 
cern, the global nature of potential 
threats to U.S. interests requires m 
tenance of flexible and diverse grou 
forces capable of rapid deployment 1 
and sustained operations in, other 
areas of strategic importance as wel 
This has led the Army to establish 
rapidly deployable light divisions, w 
continuing efforts have gone into th 
enhancement of Marine Corps ca 
pabilities and amphibious lift. 

U.S. tactical airpower supports 
achievement of theater campaign go 
by maintaining battlefield air super 
ority, providing responsive and effe^ 
firepower for ground combat units, 
conducting deep interdiction of enei 
forces, command and control faciliti 
and sources of logistics support. In 
dition, in the European theater, it ] br 
a critical role in assuring the essen 
reinforcement and resupply of U.S. 



Department of State Bu(i 



h 



k 



FEATURE 
National Security 



'.nd deployed forces by protecting port 
rai ities, aerial ports of debarkation, 
;» )Ositioned equipment and muni- 
i(S, and lines of communication. The 
:a ibility of air forces to deploy rapidly 
in rises adds to our ability to bring 
;f ctive military power to bear in dis- 
la regions in contingencies. 

Maritime forces also play a unique 
ro in supporting our national military 
it tegy. Given the realities of our geo- 
3t tegic position, fronting on two 
X ms, maritime superiority over any 
p( mtial adversary is essential to sup- 
{K . our alliance relationships and for- 
w d deployed forces. The capability of 
N y and Marine Corps forces to pro- 
je and sustain military power in areas 
ii ant from our shores is of particular 
in ortance, given the central position 
iri ae Soviet Union on the Eurasian 
la Imass and the fact that many of the 
L! ted States' most important allies are 
Ic ted on the Eurasian periphery, ac- 
ci dble from the sea. 

Our naval power projection forces 
« lid also play a major role in any 
S thwest Asia contingency. Their cur- 
n t presence in the Persian Gulf and 
A ibian Sea, together with Army and 
A Force units, is providing essential 
i port for several important national 
5 urity objectives. 

II intaining a National 

ibilization Base 
i effective mobilization of manpower 
I industrial resources in the event of 
Bonflict would provide essential sup- 
F 't for our military capabilities. Real- 
b c mobihzation plans also provide a 
Bar means for the United States to 
E nmunicate its resolve to our potential 
li /ersaries in periods of tension or 
sis. 

On the industrial side, the mainte- 
iice of a broad, technologically supe- 
r mobilization base is a fundamental 
ment of U.S. defense policy. As I 
ted when discussing the economic el- 
lents of power, we rely on the size 
d strength of the U.S. economy as 
r ultimate line of defense. And, as 
clear weapons reductions are negoti- 
id, the capability of the U.S. and al- 



lied mobilization bases rapidly to 
generate additional conventional mili- 
tary forces and the supplies and equip- 
ment to sustain them, becomes 
increasingly important. Maintenance of 
this capability supports deterrence and 
provides the ability for a timely and 
flexible response to the full range of 
plausible threats. 

Defense industrial mobilization pol- 
icies focus on steps that industry and 
government can take during peacetime 
and in the early stages of a crisis to 
acquire long-lead time items and to pre- 
pare for surge production. Examples of 
current mobilization plans include those 
providing for surge production of preci- 
sion-guided munitions; for the adapta- 
tion of new production technologies 
such as flexible manufacturing systems; 



capabilities is important to increase 
Alliance-wide efficiency and the ca- 
pability to support war plans. For ex- 
ample, the United States through its 
representation on the NATO Industrial 
Planning Committee, works closely 
with its allies to ensure that member 
nations are prepared to support the Al- 
liance strategy with a coordinated and 
effective industrial mobilization 
response. 

With regard to manpower, our mo- 
bilization plans emphasize achievable 
increases in defense manpower at a 
pace consistent with military needs. 
Under existing plans, active forces — 
depending on their location — would ei- 
ther maintain their forward deployment 
or rapidly reinforce such deployments 
from the United States. Reserve forces 
would mobilize, some military retirees 



Development and execution of sound national security policies, and the 
strategies applicable to specific situations, requires timely, accurate, 
and thorough information regarding actual or potential threats to our 
national security. 



and for the expanded production of ma- 
chine tools. 

To ensure that our industrial base 
can respond in an adequate and timely 
fashion to a broad range of potential 
emergencies, we are testing a new con- 
cept of industrial mobilization responses 
Unked to early warning indicators. Un- 
der this concept, the readiness of our 
industrial base would be progressively 
increased as intelligence suggested an 
increasing probability of hostile actions 
directed against U.S. interests. To sup- 
port this concept, in peacetime plan- 
ners will identify and catalog relevant 
industrial base capabilities, prepare 
specific response options, and create a 
series of graduated responses to be im- 
plemented within existing capabilities 
at a time of crisis. 

Such mobilization planning cannot 
be done on a purely unilateral basis. In 
the NATO context, international collab- 
oration to improve national mobilization 



would be recalled, and civilian man- 
power would be expanded to support 
such necessary defense functions as lo- 
gistics, communications, and health 
services. 

Our plans for military manpower 
mobilization are based upon the Total 
Force policy, established in the early 
1970s, which places increased respon- 
sibihties on the reserve component of 
U.S. forces. With fully 50 percent of 
the combat units for land warfare in the 
reserve components, their importance 
to our conventional deterrent cannot be 
overstated. The priority for manning, 
training and equipment mobilization is 
based on time-phasing of their use in 
operational plans. In many cases, the 
sequence of deployment would place re- 
serve component units side by side 
with, and sometimes even ahead of, the 
active duty forces. While there are spe- 
cific mission areas in which the role for 
reserve components can be expanded. 



iril 1988 



17 



we need to exercise care to avoid fun- 
damentally altering the nature of serv- 
ice in the reserves, or imbalance the 
reserve/active force mix. While not re- 
serves in the conventional sense of the 
term, in time of war Coast Guard forces 
would provide an important augmenta- 
tion to our worldwide naval capabilities. 



SUPPORTING POLICIES 



U.S. National Space Policy 

I recently approved a new national 
space policy which updates and expands 
guidelines for the conduct of U.S. na- 
tional security, civil, and commercial 
efforts in space. The policy recognizes 
that a fundamental objective guiding 
U.S. activities continues to be space 
leadership, which requires preeminence 
in key areas critical to achieving our 
broad goals. These goals include: 

• Strengthening the security of the 
United States. 

• Obtaining economic, technological 
and scientific benefits that improve the 
quality of life on earth, through space- 
related activities. 

• Encouraging the U.S. private sec- 
tor investment in space and space-re- 
lated activities. 

• Promoting international cooper- 
ative activities, taking into account 
U.S. national security, foreign policy, 
scientific, and economic interests. 

• Cooperating with other nations in 
maintaining freedom of space for ac- 
tivities that enhance the security and 
welfare of mankind. 

• Expanding human presence and 
activity beyond Earth orbit into the so- 
lar system. 

The use of space systems to satisfy 
many critical national security require- 
ments is an expanding and vital ele- 
ment of U.S. national power. Functions 
important to our national security 
strategy such as communications, navi- 
gation, environmental monitoring, early 
warning, surveillance, and treaty ver- 
ification are increasingly performed by 
space systems. In many cases, the 
worldwide access provided by the space 
systems makes them the only available 



18 



means for accomplishing these impor- 
tant functions. Absent the assured use 
of space, our nation's security would be 
seriously jeopardized. 

Our military policy for space en- 
compasses five elements. 

First, we recognize that deter- 
rence — at all levels of potential con- 
flict — cannot be accomplished without 
space-based assets, so we seek to en- 
sure that critical space systems will be 
available to commanders, commensu- 
rate with their need. 

Second, we seek to ensure free ac- 
cess to space for all nations, in a man- 
ner analogous to the way that free 
access to the earth's oceans is 
maintained. 

Third, we encourage interaction 
among national security, civil govern- 
ment and, where appropriate, commer- 
cial space programs to share critical 
technologies and avoid unnecessary du- 
plication of activities. 

Fourth, our policies provide for im- 
proved defensive capabilities in the fu- 
ture, deterring or, if necessary, 
defending against enemy attacks on our 
space systems. 

Finally, we will continue to im- 
prove those space systems that directly 
support our military forces by enhanc- 
ing their effectiveness. 

Our civil space activities contribute 
to the nation's scientific, technological, 
and economic well-being in addition to 
making a major contribution to Amer- 
ica's prestige and leadership in the 
world. Our civil space goals are: 

• To advance scientific knowledge of 
the planet Earth, the solar system, and 
the universe beyond. 

• To preserve our preeminence in 
critical aspects of space science, space 
applications, space technology, and 
manned spaceflight. 

• To open new opportunities for use 
of the space environment. 

• To develop selected civil applica- 
tions of space technology. 

• To engage in international cooper- 
ative efforts that further U.S. space 
goals. 



• To establish a permanently mar 
ned presence in space. 

U.S. leadership in civilian space u 
programs has been taken for granted i . 
since the late 1960s. That leadership, 
however, is being increasingly chal- 
lenged both by our friends and allies ., 
abroad, and by the Soviet Union. Thi^! 
ambitious program of space explorati 1 
and research that the Soviets are pui 
suing, centered upon a high level of 
launch capacity and the Mir Space St , , 
tion, have eroded traditional areas of !, 
U.S. space leadership. Initiatives — swi 
as efforts to improve our space trans , ', 
portation systems, develop and deplc 
the Space Station, and develop the 
technologies to support a range of fu 
ture solar system exploration option 
are intended to ensure U.S. preemi- 
nence in areas critical to our nationa 
interests. 

The United States is first amon; 
nations in its efforts to foster a pure 
commercial, market-driven space ind 
try without direct government sub- 
sidies. We believe that private sectoi 
space initiatives will have positive ef 
fects on the U.S. balance of trade, , 
work force skills, and the developme 
of unique manufacturing methods an 
products. These initiatives also prom 
lower costs to the taxpayer and en- 
hanced security to our nation. We ar 
confident that traditional American i 
genuity will yield innovative space tt 
onology applications comparable to, 
exceeding, those achieved in aviation 
earlier this century. 

U.S. Intelligence Policy 

Development and execution of sound 
national security policies, and the st: 
egies applicable to specific situations 
require timely, accurate, and thorouf 
information regarding actual or pote: 
tial threats to our national security. 
Early warning of developments whic 
could place at risk U.S. interests is ' 
tal if we are to employ the relevant 
elements of national power in a timel 
way and deal with threats before the 
become unmanageable, or entail the 
risk of conflict. The primary goal of 



Department of State Bulll 



FEATURE 
National Security 



J . intelligence activities is to provide 
ipropriate agencies of government 
vTi the best available information on 
vT eh to base decisions concerning the 
itjlopment and conduct of foreign, 
K lomic and defense policy. 

It is axiomatic that our National 
3( arity Strategy must be strongly 
51 ported by reliable intelligence con- 
ic ling potential adversaries' national 
li ibilities and probable courses of ac- 
:i . Intelligence also provides essen- 
-i insights into how we are viewed by 
tl !e adversaries. Their perceptions of 
31 capabilities, political will, national 
in rests, and likely reaction to hostile 
pi vocation, provide an important 
m sure of the effectiveness of our 
st tegy. The collection of such infor- 
ir ion is a priority objective of our in- 
K gence activities. It must be pursued 
a vigorous, innovative, and responsi- 
b manner that is consistent with ap- 
p able law and respectful of the 
p iciples upon which this nation was 
ft ided. 

The capability to deal with the hos- 
ti intelligence threat to the United 
S tes is equally important. The large 
a; active intelligence services of the 
S iet Union, its clients and surro- 
g 3S, conduct sophisticated collection 
a analysis operations targeted 
i Inst us, our allies, and friends. The 

lets rely heavily on espionage and 
J. alaborate apparatus for illegal ac- 
q sition of Western military technology 
ti 'urther their strategic aims. The ap- 
p hension over the past few years of 
8! 5s conducting highly damaging es- 
pnage operations against the United 
S tes has dramatically underUned the 
s erity of the threat. I have directed 
t t the U.S. intelligence community 
p e special emphasis to detecting and 
c ntering espionage and other threats 
: m foreign intelligence services. 

International terrorism and narcot- 
1 trafficking, particularly when state- 
i )ported, can threaten the security of 
t ' U.S. and our citizens. Intelligence 
1 ys a critical role in our efforts to 
< itrol and reduce these threats. Intel- 
i ance collection and special operations 
' agencies of the U.S. Government to 

)tect against international terrorism 

i international narcotics activities 

1 remain a high priority. 



The ability to conduct covert action 
operations is an essential element of 
our national security capability. In se- 
lected circumstances such operations 
provide a means to deal with develop- 
ing threats to our security before the 
employment of U.S. military power or 
other actions entaihng higher costs and 
risks are required. Over the past year, 
we have reviewed all existing covert ac- 
tion programs to ensure that they are 
in accordance with apphcable law and 
consistent with U.S. policy. We have 
also put into place procedures for ap- 
proval, review and congressional notifi- 



cation of new covert action operations 
to ensure that such operations receive 
appropriate interagency review, and are 
consistent with applicable law. Addi- 
tionally, we have instituted stricter 
accountability of access to protect confi- 
dentiality, and have established "sunset 
provisions" that require annual review 
of all covert action programs, and their 
continuation only by Presidential ap- 
proval. We will continue to employ such 
covert action operations in support of 
national security objectives, and ensure 
that they are consistently supportive of 
national policy. 



IV. Integrating Elements of Power 
into National Security Strategy 



STRATEGY FOR THE 
WESTERN HEMISPHERE 

Our own territorial security is inex- 
tricably linked with the security of our 
hemispheric neighbors, north and 
south; the defense of North America is 
the nation's most fundamental security 
concern. We sometimes fail fully to ap- 
preciate the great strategic importance 
of the Latin American and Caribbean 
regions, in spite of their proximity to 
our borders and importance to our na- 
tional security. The significance of these 
regions has not been lost to Soviet 
planners, however, who refer to Latin 
America and the Carribean as our 
"strategic rear." The U.S.S.R. has, 
since the early 1960s, increasingly 
sought to expand its influence in these 
areas to the detriment of our own se- 
curity. Our national interests, as well 
as our political principles, have led us 
to promote democracy and economic 
progress throughout the hemisphere. 
In the past, we have relied on a hemi- 
spheric security system composed of a 
strong U.S. deterrent, broadly-based 
cooperation with Canada, and collective 
security arrangements wath Latin 
America. More recently we have built 
on this foundation a policy aimed at 
strengthening the ability of our Central 



American and Caribbean neighbors to 
resist outside aggression and subver- 
sion, and facilitating the transition to 
democracy in the region. Today 28 of 33 
countries in Latin America and the 
Caribbean, with over 90 percent of the 
population, are democratic. As we work 
for further consolidation of democracy, 
we continue to promote economic coop- 
eration with our Hemispheric 
neighbors. 

We remain deeply committed to the 
interdependent, regional objectives of 
democracy and freedom, peace, and 
economic progress. To achieve these, 
we must counter the threat of Soviet 
expansionist policies not only from 
Cuba, but now from Nicaragua. Critical 
national security interests in Latin 
America are based on long-standing 
U.S. policy that there be no Soviet, 
Cuban, or other Communist bloc beach- 
head on the mainland of the Western 
Hemisphere, or any country that up- 
sets the regional balance and poses a 
serious military threat to its neighbors. 
Representative democracy in Nicaragua 
is a key goal in our strategy to achieve 
lasting peace and our other interdepen- 
dent security objectives for the 
hemisphere. 

We support the Guatemala Peace 
Accords and welcome the initial steps 



ijril 1988 



19 



taken by the Sandinistas in the direc- 
tion of a freer, more democratic and 
pluralistic Nicaragua, as agreed to in 
the Accords. Yet we have reason to re- 
main skeptical. It is too soon to tell if 
the Sandinista leaders will comply with 
the pledges they have made. The San- 



tion and trafficking, which pose threats 
not only to the integrity and stability of 
governments to our South, but to the 
social fabric of the United States itself. 
Working bilaterally, and wherever pos- 
sible on a regional basis, we are supply- 
ing resources and e.xpertise to the 



Critical national security interests in Latin America are based on long- 
standing U.S. policy that there be no Soviet, Cuban, or other Commu- 
nist bloc beachhead on the mainland of the Western Hemisphere. . . . 



dinistas have made similar promises in 
the past — including in 1979 to the Orga- 
nization of American States — which 
were broken. It is important to keep in 
mind, however, that even if the Nic- 
araguan government should live up to 
its obligations under the Guatemala 
Peace Accords in full and credible fash- 
ion, security concerns affecting impor- 
tant U.S. interests would remain. They 
include the Soviet and Cuban military 
presence in Nicaragua, and the rapid 
growth of the Nicaraguan military ca- 
pability which threatens the military 
balance of the region as well as Nic- 
aragua's democratic neighbors. 

To encourage the Sandinistas to 
implement the agreed reforms in good 
faith, and to advance U.S. security in- 
terests in Central America, we have en- 
gaged in extensive and close 
consultation with the Central America 
democracies and the Nicaraguan Re- 
sistance. One key element of our diplo- 
matic strategy is the pressure exerted 
on the Sandinista regime by the Nic- 
araguan Resistance. We will continue 
funding the Resistance until we see evi- 
dence that democratization in Nic- 
aragua is real and irreversible. 
Accordingly, the Administration will re- 
quest renewed assistance for the Free- 
dom Fighters early this year. Economic 
and trade sanctions are other key ele- 
ments of our coordinated strategy. 

Currently we are deeply involved 
in the struggle throughout Latin Amer- 
ica against the menace of drug produc- 



20 



governments wishing to engage with us 
in this priority effort. 

Increased trade among the West- 
ern Hemisphere countries is also an 
important element of our national se- 
curity strategy. Such trade will aid 
debtor countries in the region in man- 
aging their obligations in a responsible 
manner while contributing to their eco- 
nomic growth. In addition, the United 
States supports providing additional re- 
sources for the World Bank and the In- 
ternational Monetary Fund (IMF) to 
assist these countries in adjusting to 
the consequences of external economic 
forces, such as the decline of world oil 
and other commodity prices. 

Our close relationship with Canada 
derives from our long historical and cul- 
tural association, as well as geopolitical 
and economic factors — our physical 
proximity, the openness of our more 
than 3,000 mile border, and our impor- 
tant military cooperation, both bilater- 
ally and under the NATO aegis. 
Economically, Canada is by far our 
largest trading partner. Our primary 
objective with respect to Canada, a 
close friend and ally, is to protect and 
strengthen the already excellent rela- 
tions we enjoy. In the near-term, our 
goal can be best achieved by securing 
approval by the U.S. Congress and Ca- 
nadian Parliament of the recently nego- 
tiated United States-Canada Free 
Trade Area agreement. This agreement 
will benefit both countries by removing 



tariff and non-tariff barriers to trade 
goods and services and by facilitating' 
cross-border investment by the prival 
sectors of both countries. I 



STRATEGY FOR THE SOVIET 
UNION AND EASTERN EUROPE 

As mentioned earlier, the most signiJ ' 
cant threat to U.S. national interests' 
remains that posed by the Soviet 
Union. Despite some improvement ir 
U.S. -Soviet relations over the past 
year, the long-term threat has not pe 
ceptibly diminished. 

The differences between the 
United States and the Soviet Union ; 
fundamental in nature, given the gre 
disparities in our political, economic 
and social systems, and our diverger 
geostrategic interests. While the mu 
publicized reforms of the new Soviet 
leadership have raised expectations < 
more benign Soviet policies, there is 
yet no evidence that the Soviets hav 
abandoned their long-term objective; 
This means that U.S. strategy to coi 
ter these objectives must also remai 
consistent and aimed at the long-ter 
We must remain sufficiently flexible 
seize the initiative and explore posit 
shifts in Soviet policy which may 
strengthen U.S. security; but we mi 
not delude ourselves into believing t [ 
the Soviet threat has yet been funda 
mentally altered, or that our vigilan' 
can be reduced. 

Consistent with this approach, c 
overall strategy toward the Soviet 
Union remains to contain Soviet exp 
sionism, and to encourage political d 
mocracy and basic human rights witl 
the Soviet Union and the countries i 
der its hegemony. These have been t 
national security objectives of sue 
cessive U.S. administrations, though 
the manner of their implementation 
varied. Continued emphasis on the 
principles of strength, dialogue and i 
alism in our strategy may eventually 
alter Soviet behavior in fundamental 
ways to create a more stable and pet 
fill world. 



Department of State Bulll 



FEATURE 
National Security 



The maintenance of adequate 
angth to deter Soviet aggression 
ji vhere in the world that our strate- 
ic nterests require is central to our 
u:egy. Such strength must encom- 
ia not only military power, but also 
h> political determination, vitality of 
Jl nces and the economic health es- 
e ial to meet our global respon- 
i\ ities. In areas where the Soviets 
If currently engaged in military ex- 
)a iionism, such as Afghanistan, the 
Jl .ed States is demonstrating its will- 
ni ess to support local resistance 
b" js to the degree necessary to frus- 
n ; Soviet ambitions. In general, our 
1:0 3 are to convince the Soviet Union 
,h the use of military force does not 
ffi and that the build-up of military 
3S beyond levels necessary for legit- 
ir e national defense will not provide 
It iteral advantage. 

National strength must be comple- 
n ted by constructive dialogue. We 
ii i established a four part agenda for 
ii ussion with the Soviet Union: arms 
r« iction, human rights, resolution of 
« onal conflicts, and bilateral ex- 
it iges. We have made clear that sub- 
rt itial progress in all areas is 
u ;ssary to allow a truly qualitative 
in rovement of U.S. -Soviet relations. 
O emphasis on human rights is di- 
rt ly relevant to our security strategy 
bi iuse we believe that the manner in 
w ch a government treats its own peo- 



)€spite some improvement in 
f.S. -Soviet relations over the 
<ast year, the long-term threat 
as not perceptibly diminished. 



0'. reflects upon its behavior in the in- 
lational community of nations. 
Although progress in U.S. -Soviet 
til ins has historically been difficult 
iredict, present indications are that 
Siiviet leadership recognizes that 
le nf the country's past policies must 
iltered to prevent further domestic 

' nomic and technological obsoles- 
ce. In this regard, the policies of the 



current leadership have a marked stra- 
tegic cast to them, to the extent that 
they aim at placing the Soviets in a 
more competitive position vis-a-vis the 
United States over the long term. At 
the same time, should the Soviets de- 
monstrate that they genuinely wish to 
improve the U.S. -Soviet relationship by 
reducing military expenditures and 
force structure, by terminating Third 
World subversion and expansion, and 
by focusing on their internal problems, 
they wall find the United States wel- 
coming their more responsible behavior 
on the international scene. 

While acknowledging that most of 
the countries of Eastern Europe are 
members of the Warsaw Pact, we have 
never recognized Soviet hegemony in 
the region as legitimate or healthy be- 
cause it is based on military power and 
dictatorship, not democratic consent. 
We wish to develop our relations with 
each country of the region on an indi- 
vidual basis. Many East European 
countries at present face severe eco- 
nomic difficulties as a result of forced 
emulation of Soviet economic models. 
The populations of these countries are 
significantly pro- Western in outlook and 
would hke to strengthen ties with the 
Western community of nations. At the 
same time, the economic utility of East- 
ern Europe to the Soviet Union is 
declining. 

These factors combine to give the 
United States an opportunity to im- 
prove its relations with Eastern Euro- 
pean countries. Our objectives in the 
region are to encourage liberalization 
and more autonomous foreign policies, 
and to foster genuine, long-term human 
rights improvements. Our strategy is to 
differentiate our policies toward these 
countries according to their conduct, 
and to develop relations with each 
based on individual merit. 

The United States and its NATO 
Allies also are working jointly to over- 
come the artificial division of Europe 
which occurred after World War II and 
to promote closer ties between Eastern 
and Western Europe. This takes place 
primarily through the 35-nation Confer- 
ence on Security and Cooperation in 
Europe, which serves to maintain pres- 
sure on the Soviet Union and Eastern 



European governments to improve hu- 
man rights performance and increases 
contact and communication between 
East and West. 



STRATEGY FOR WESTERN 
EUROPE AND NATO 

The security of Western Europe is a 
vital component of U.S. National Se- 
curity Strategy. We share a common 
heritage and democratic values with 
Western European countries, have a 
compelling mutual interest in contain- 
ing Soviet expansion, and benefit from 
interdependent economic relations. 

Overall, our objectives in Western 
Europe are to help maintain the re- 
gion's security and independence from 
Soviet intimidation, to promote its po- 
htical and economic health, to consult 
with European governments on effec- 
tive policies toward the Soviet Union 
and the Warsaw Pact, and to work with 
Western Europeans toward overcoming 
the East-West division of the European 
continent. 

The North Atlantic Alliance em- 
bodies the U.S. commitment to West- 
ern Europe as well as the members' 
commitment to defend each other. 
NATO has preserved peace in Europe 
for almost 40 years, by far the longest 
period of peace on the continent in this 
century. Through the Alliance, NATO 
members engage in collective defense 
to deter Soviet aggression and enhance 
security. NATO is, however, both a po- 
litical and military entity. Through 
NATO, the United States also consults 
with its Western European Allies on a 
wide range of issues. 

The cohesion and unity of NATO 
are essential to a successful security 
strategy relative to the Soviet Union. 
The repeated and unsuccessful Soviet 
efforts to drive wedges between the 
United States and Western Europe tes- 
tify to the strength of Alliance unity. 
These Soviet efforts have been 
thwarted through close and frequent 
high-level consultations among allies, to 
maintain our solidarity and our common 
strategy on crucial issues. The most re- 
cent success story of the Alliance has 



ril 1988 



21 



been the conclusion of an Intermediate- 
Range Nuclear Forces (INF) Treaty be- 
tween the United States and the Soviet 
Union. This agreement vindicates 
NATO's 1979 dual-track decision which, 
through commitment both to negotiate 
and to deploy intermediate-range nu- 
clear forces, gave the Soviet Union in- 
centive eventually to agree to the total 
elimination of this category of weapons. 
The cohesion of the Alliance and the 
courage of Allied governments which 



Montebello agreement, including the 
provisions on nuclear modernization, as 
well as some restructuring of NATO's 
nuclear forces. 

• Maintenance of a credible conven- 
tional deterrent with emphasis on fur- 
ther execution of Alliance approved 
conventional defense improvements, in- 
cluding provisions for air defense and 
increased sustainability stocks. 

• More effective use of resources 
available for deterrent capabilities 



NATO has preserved peace in Europe for almost 40 years, by far the 
longest period of peace on the continent in this century. 



deployed INF missiles despite some- 
times significant domestic resistance 
has paid off, and resulted in the first 
agreement in history which will actu- 
ally reduce nuclear arsenals. 

The United States, working closely 
with NATO allies, hopes to reach other 
successful arms agreements with the 
Soviet Union; but we have made clear 
that the strategy of flexible response 
will require the continuing presence of 
U.S. nuclear weapons, and strong con- 
ventional forces, in Europe. This is par- 
ticularly true in view of the great 
disparity in conventional forces on the 
continent which directly threatens 
Western Europe. The pronounced con- 
ventional force imbalance has been a 
matter of concern for many years. In 
1985, the Alliance adopted an ambitious 
plan of action designed to remedy 
NATO's most critical conventional defi- 
ciencies. Progress in some areas — such 
as the provision of aircraft shelters and 
the filling of critical munition short- 
falls — has been encouraging, but much 
more remains to be accomplished. 
Within the context of these ongoing 
efforts, the United States will work in 
close consultation with our allies 
toward: 

• Maintenance of the credibility of 
NATO's nuclear deterrent. We will 
work toward full implementation of the 



22 



through national defense budgets. We 
are just beginning to realize a return 
on initial efforts in armaments coopera- 
tion, and will work closely with our al- 
lies to bring to fruition other programs 
recently initiated with Congressionally 
reserved funds for cooperative research 
and development. We will also continue 
to search for new opportunities to en- 
hance conventional defense capabilities 
in resource-effective ways, such as im- 
proved crisis management procedures 
and rationalization of roles and missions 
with our allies. 

• Improvement of the military use 
of technology, while strengthening 
NATO's industrial base, particularly in 
some countries on NATO's southern 
flank. 

Narrowing the gap in conventional 
capabilities can enhance deterrence, 
raise the nuclear threshold and reduce 
the risk of Soviet miscalculation. It also 
offers the best hope of inducing the So- 
viets to negotiate seriously toward a 
stable conventional equilibrium at lower 
force levels. 

NATO also provides a forum for 
Western consultation on such political 
processes as the Conference on Se- 
curity and Cooperation in Europe 



(CSCE), where our goal is to ensure 
full Soviet and Eastern European im- 
plementation of the commitments un- 
dertaken in the Helsinki Final Act ar 
Madrid Concluding Document. Of spe 
cial interest are the CSCE provisions 
on human rights and freer flow of pe( 
pies and information across the East- 
West divide. CSCE represents a cruc 
means by which the United States an 
its Allies are working to reduce the r 
pression and the artificial barriers 
which have existed since the Soviet 
Union imposed its will on neighborin; 
countries after World War II. 

Although the NATO Alliance re- 
mains strong and vigorous, aspects oi 
our relationship with Western Europt 
transcend NATO concerns. These in- 
clude issues such as trade and protec 
tionism, methods of dealing with 
terrorism, and policy toward regions 
outside of the NATO geographic are; 
We seek to work closely with Wester 
European governments on these mat 
ters, though there are sometimes dif 
fering viewpoints as is natural amonj 
sovereign, democractic governments. 



STRATEGY FOR THE MIDDLE 
EAST AND SOUTH ASIA 



Despite the multitude of changes in 
Middle East over the past several de 
ades, U.S. objectives have held rems 
ably constant. In harmony with the 
predominant aspiration of the people 
of the region, we remain deeply com 
mitted to helping forge a just and la> 
ing peace between Israel and its 
neighbors. Our regional goals also in 
elude limiting Soviet influence, foste 
ing the security and prosperity of 
Israel and our Arab friends, and cur 
ing state-sponsored terrorism. To 
achieve these aims, we must hurdle 
some serious obstacles including con 
tinuing, deep-seated Arab-Israeli tei 
sions, the emotionally-charged 
Palestinian problem, radical anti- 
Western political and religious move' 
ments, the use of terrorism as an in- 
strument of state policy, and Soviet 
policies which have supported the 
forces of extremism rather than the 
forces of moderation. 



Department of State BulS 



FEATURE 
National Security 



In working to overcome these 
lUacles we pursue a strategy which 
ji ^grates diplomatic, economic and 
11 tary instruments. With regard to 
i Arab-Israeh peace process, the 
U ;. initiative of September 1, 1982, re- 
•n ns the cornerstone of our approach. 
fi ile working diplomatically to narrow 
ti gap and make direct negotiations 
pi sible, we also provide military and 
a( lomic assistance to our friends in 
t.1 region to bolster their security in 
:\ face of continuing threats. Moder- 
ii regimes must be secure if they are 
U un the risks of making peace. At 
tl same time, we remain willing to 
c< Front and build international pres- 
si ; against those states, such as Libya 
a] Iran, which sponsor terrorism and 
p mote subversion against friendly 
g ernments. 

In the Persian Gulf region, we also 
p sue an integrated approach to se- 
ci 3 our four longstanding objectives: 
ir ntaining freedom of navigation; 
si mgthening the moderate Arab 
si es; reducing the influence of anti- 
V ;tern powers, such as the Soviet 
t on and Iran; and assuring access to 

)n reasonable terms for ourselves 
a our allies. Iran's continuation and 
e ilation of the Iran-Iraq War, includ- 
ii its attempts to intimidate non- 

b igerent Gulf Arab states, pose the 
njt serious, immediate threat to our 
ii crests, and provide the Soviet Union 
tl opportunity to advance its regional 
i nda. 

In responding to these threats dip- 
It latically we work persistently to end 
tl war, both unilaterally — as with Op- 
etion Staunch, to cease the flow of 
« • materiel to Iran — and through mul- 
titeral forums, such as the United 
ttions Security Council. The current 
ej Uenge is to get Iran to join Iraq in 
aiepting a comprehensive settlement. 
' Since 1949, our diplomatic commit- 

1 nt to regional stability and un- 
'. rupted commerce has been 

•ported by our military policy of 
intaining a permanent naval pres- 
•e in the Persian Gulf. That presence 
urrently expanded to allow us to 
er Iranian attempts to intimidate 



moderate states in the region, and to 
play our traditional role of protecting 
U.S. flag shipping in the face of in- 
creased Iranian aggressiveness. Five 
other NATO governments have also 
made decisions to deploy naval vessels 
to the Gulf where they assist in pro- 
tecting freedom of navigation. A pru- 
dent but responsive policy of arms sales 
for the self-defense of our friends in the 
region is also an integral part of our 
strategy, as those nations assume 
greater responsibility for their own 
defense. 



looking for ways to improve their rela- 
tions with each other. 

We remain unequivocally opposed 
to the Soviet military presence in 
Afghanistan. In the absence of a politi- 
cal settlement which provides for a 
prompt and complete withdrawal of So- 
viet troops, restoration of Afghanistan 
to its independent non-aligned status, 
and self-determination for the Afghan 
people, we will continue our firm sup- 
port for the Afghan cause. We also 
work to bolster the security of 
Pakistan, the frontline state hosting 



Despite the multitude of changes in the Middle East over the past 
several decades, U.S. objectives have held remarkably constant. 



] 



In South Asia, we aim to reduce 
regional tensions, especially those be- 
tween India and Pakistan; to restore 
freedom in Afghanistan; to promote 
democratic political institutions and 
economic development; to end narcotics 
production and trafficking; and to dis- 
courage nuclear proliferation. These ob- 
jectives are threatened primarily by the 
Soviet occupation of Afghanistan, the 
continuing antagonism between India 
and Pakistan, and the refusal of those 
two states to restrain sensitive aspects 
of their nuclear programs. 

In dealing with the problem of nu- 
clear proliferation in South Asia, we 
have followed a two-track approach. 

First, we have made clear to the 
government of Pakistan that our provi- 
sion of security assistance requires 
Pakistani nuclear restraint. At the 
same time, provision of U.S. military 
and economic assistance helps Pakistan 
meet legitimate security needs without 
resorting to the acquisition of nuclear 
weapons. Secondly, recognizing that 
there is a regional context for the 
Pakistani nuclear program, we have en- 
couraged India and Pakistan toward an 
agreement on confidence building mea- 
sures. We are encouraged that the lead- 
ership in both countries is actively 



nearly three million Afghan refugees, 
with a second six-year assistance plan. 
By expanding our ties with India as 
well as Pakistan, we hope to foster sta- 
bility in South Asia. Recent advances in 
technological and scientific cooperation 
between the United States and India, 
in both civilian and military areas, with 
prospects for further growth, have been 
important in improving relations be- 
tween our two countries. We also pro- 
vide development assistance throughout 
the region and support the work of the 
South Asian Association for Regional 
Cooperation to promote stability by fos- 
tering regional economic growth. 

The sharp reduction in U.S. eco- 
nomic and military assistance funding, 
plus Congressional opposition to the 
sale of modern defense weapons to a 
number of states, has had a negative 
impact on U.S. security interests in 
both the Middle East and South Asia. 
These cutbacks in security assistance 
have been all the more damaging be- 
cause threats to friendly states have in- 
creased their need for security 
assistance and weapons. At the same 
time, the Soviet Union has become 
more aggressive in offering weapons to 
countries unable to obtain them from 
the United States. The Soviets have 



11988 



23 



also become more active in using eco- 
nomic instruments such as debt re- 
scheduling to enhance their own 
poHtical influence. 



STRATEGY FOR EAST ASIA 
AND THE PACIFIC 

As a Pacific power the United States 
faces formidable challenges in project- 
ing its strength across that broad re- 
gion. Our security objectives, as 
elsewhere, are aimed at helping our al- 
lies and friends in the region to develop 
economically and politically as they de- 
fend themselves from encroachment. 
We are meeting with success in most 
areas. The free nations of East Asia 
and the Pacific now lead the world in 
demonstrating an economic and political 
dynamism that stands in stark contrast 
with conditions in other nations in the 
regions such as Vietnam and North 
Korea. Our Asian allies and friends also 



Cooperation with Japan remains 
basic to U.S. relationships in the re- 
gion. The United States-Japan Treaty 
of Cooperation and Security formalizes 
our defense ties, providing a security 
foundation for the broad spectrum of 
economic and political associations 
which uniquely join us. 

During the past ten years, a con- 
sensus has emerged in Japan that Japan 
should undertake the primary responsi- 
bility to defend its homeland, territorial 
seas and skies, and its sea lanes out to 
1,000 nautical miles. In 1985 the govern- 
ment of Japan incorporated that con- 
cept into its current Five Year Defense 
Plan. Japan's defense spending has in- 
creased more than five percent per year 
in real terms for the past five years, 
and we have encouraged Japan to con- 
tinue modernizing its forces in order to 
carry out its legitimate defense respon- 
sibilities. In addition to providing for 
its own defense forces, Japan contrib- 
utes over $2 billion per year to support 
U.S. forces stationed in Japan. 



The free nations of East Asia and the Pacific now lead the world in 
demonstrating an economic and political dynamism. . . . 



stood together vdth us in the years of 
effort required to achieve the INF 
Treaty, which removes a threat from 
Asia, as well as from Western Europe. 
Soviet military power in Asia and 
the Pacific continues its steady qualita- 
tive improvement, but the U.S. re- 
sponse is not confined to technical 
issues of relative military strength. Our 
basic aims are to strengthen the natu- 
ral political and economic ties that link 
us with regional states, to evoke 
greater participation by our allies and 
friends in their own defense, and to 
proceed steadily with necessary mod- 
ernization of our military forces de- 
ployed to the area. 



The economic dimension of our re- 
lationship with Japan, as well as with 
other key nations in the region, is so 
prominent that it must be considered 
an integral part of our national security 
strategy. The massive trade surplus of 
Japan with the United States is unsus- 
tainable and a source of pohtical ten- 
sion, as are the lesser surpluses of 
other regional nations. Such economic 
imbalances must be reduced through a 
combination of measures including sup- 
port for U.S. initiatives for multilateral 
trade liberalization in the GATT. 

In view of the globalization of fi- 
nancial markets, cooperation with 
Japan on economic policy will be key to 
maintaining confidence on world stock 



and currency markets. A recent posi- 
tive development is Japan's significant,, 
increased expenditures on foreign as- . '. 
sistance. Japan continues to target as,, 
sistance on countries of strategic i '. 
importance, and is giving more of its i" 
aid in "untied" form than in the past.,' 

Our alliance with the Republic of 
Korea remains vital to regional sta- 
bility. North Korea maintains forces , 
that far exceed those of the South in • 
quantity, are continuously strengther 
by additonal Soviet weapons, and ar(.| 
the hands of a government whose ag- , 
gressive demeanor and tendency to a 
unexpectedly are well known. Our m 
tary presence in the Republic of Kor 
underpins regional stabihty and buili 
confidence, which is essential to that 
country's remarkable economic devel 
ment and political evolution. Sound .- 
curity, politics, and economics are 
indivisible. In this process, the Unit 
States has used its influence to enco 
age Koreans toward democratic char 
We have done so, however, with resi : 
for Korean traditions and political n 
ities; and we are mindful of the con- 
stant security threat. The Republic 
Korea is our seventh largest trading 
partner; significant market and inve 
ment opportunities for U.S. firms e) 
ist. Market access barriers are comi 
down, but not fast enough, and muc 
more remains to be done. 

Both the People's Republic of CI <■ 
and the United States have cultivate 
good relations based on realistic cal- 
culations of each country's best inter 
ests. For our part, we continue to 
believe that a strong, secure, and mi 
ernizing China is in our interest. Al- 
though our economic, social, and 
political systems differ, we share a c 
mon perception of the requirement i 
stability in the region and for re- 
sistance to expansionism. On this ba 
we have continued to increase our 
trade, people-to-people contacts, an 
even limited, defensive military coop 
ation. Differences persist over some 
sues, but we have continued to deve 
a mature relationship that clearly bi 
fits both countries. 



24 



Department of State Bui 






FEATURE 
National Security 



Through assiduous management of 
th United States-China relationship, 
,v. expect to cooperate when our inter- 
es; and China's are parallel, such as in 
A hanistan, and in maintaining sta- 
oi;y in East Asia. We are confident a 
lel-headed national consensus on how 
tc onduct relations with China will re- 
m n the foundation for additional 
^>vth and interaction in the 
« .tionship. 

The Phillipine government has 
ir ie progress restoring democracy and 
\i ng the foundation for economic 
g- svth. The Aquino government, how- 
e' r, continues to face major political, 
si Jrity and economic challenges. 
T ough all of the tools available to us, 
w are determined to help this impor- 
t: t Pacific ally to overcome these 
p blems so it can sustain economic 
g wth, counter the threat of a virulent 
ii ;rnal communist insurgency, and 
8 jngthen democratic government. 

Thailand, another Association of 
g itheast [Asian] Nations (ASEAN) 
r mber, and our treaty ally, borders 
( nbodia, which is now occupied by 
t Vietnamese and the site of an active 
( nbodian resistance effort struggling 
t regain self-determination for the 
I mer people. In support of Thailand, 
T ich also shoulders the major refugee 
I "den in Southeast Asia, we will con- 
t ue our close security cooperation to 
t ;er any potential aggression and 
I intain our support of eligible refu- 
(3S. We will also continue our cooper- 
i ve effort with Thailand to suppress 
1 rcotic trafficking. 

We view the continued occupation 
( Cambodia by Vietnamese forces as 
J unacceptable violation of interna- 
t nal law that undermines regional 
brts towards development, peace and 
ibility. We also oppose the return of 
2 Khmer Rouge to power in Cam- 
dia. We will continue our strong en- 
rsement of ASEAN's quest for a 
litical solution and support for the 
n-Communist elements of the Cambo- 
in resistance coalition. Under our ini- 
itive on regional problems at the 
nited Nations, we are prepared to 
ay a constructive role in efforts to 
hieve a Cambodian settlement. In the 



context of a settlement involving the 
complete withdrawal of Vietnamese 
troops, we are prepared to enter into 
normalization talks with Vietnam. 

Despite our serious differences 
with Vietnam, through bilateral discus- 
sions we have achieved progress in ac- 
counting for our missing servicemen, 
and in release of reeducation internees 
and Amerasians. We have also seen a 
modest but welcome improvement in re- 
lations between Laos and the United 
States. Our primary measure of Lao- 
tian sincerity in improving relations 
with the U.S. is accelerated efforts to 
account for our servicemen still 
missing. 

As Australia enters its bicentennial 
year, close bilateral bonds and security 
relationships continue to be the key- 
stone of our policy in the region. But 
regrettably, New Zealand has now writ- 
ten into law the policies that caused us 
to suspend our ANZUS [Australia, 
New Zealand, and United States se- 
curity agreement] Treaty obligations to 
Wellington. This has dimmed the pros- 
pect of New Zealand's resuming its 
place in the Alliance. 

The South Pacific more broadly is 
passing through a generational change 
and the stresses of economic and demo- 
graphic shifts. The island nations of the 
South Pacific have joined the legion of 
commodity-exporting countries whose 
efforts to develop a stable economic 
base have been undermined by per- 
sistently low world commodity prices. 
At the same time, the positive effects 
of improved health care have produced 
rapid increases in population. Memories 
of U.S. cooperation with the islanders 
during World War II are dimming. Re- 
source constraints have prevented us 
from assisting as much as we would 
vnsh, but we expect Congress to ap- 
prove expeditiously authorization for 
$10 million annually over the five-year 
life of the new fisheries treaty with the 
region's islands states. This should help 
offset some of the irritants that have 
troubled our traditional good relations 
in the region and have invited Soviet 
probes. 



In Fiji this past year, we have sor- 
rowfully witnessed a prolonged strug- 
gle within that nation's ethnic 
communities over their future. We re- 
main committed to encouraging a 
broadly based resolution of Fiji's politi- 
cal troubles. 

The decision of the people of Palau 
last year to accede to the Compact of 
Free Association lays the foundation for 
creation of a third freely associated 
state and for closing our UN trustee- 
ship in the Pacific Islands. This act of 
self-determination promotes our behef 
in stability through democracy; and the 
Compact of Free Association helps ac- 
compHsh our goal of preventing these 
Pacific states from becoming caught up 
in superpower rivalry. 

Soviet interest in East Asia and 
the Pacific remains on the upswing, 
however, as Moscow's increasingly skill- 
ful propagandists seek to erode the con- 
cept of deterrence and promote 
seemingly benign disarmament 
schemes. The United States and the 
people of the region naturally seek a 
reduction of tensions. But this should 
begin at the real points of tension — 
North Korea and Vietnamese-occupied 
Cambodia, for example. We will not be 
lured into proposals designed to 
weaken relations with our allies or uni- 
laterally impair our ability to protect 
U.S. interests in East Asia and the Pa- 
cific region. 



STRATEGY FOR AFRICA 

The diversity of Africa embodies a 
broad range of national security inter- 
ests and presents numerous challenges 
for the United States. We maintain mil- 
itary access or U.S. facihties in several 
countries in support of our strategic in- 
terests in the region and beyond (such 
as in Southwest Asia and the Persian 
Gulf). Africa is an important source of 
strategic minerals and a potential 
growth market for U.S. exports. Its 
shores adjoin some of the most impor- 
tant international sea lanes. It repre- 
sents a significant voting group in the 
United Nations and other international 
organizations. 



Dhl 1988 



25 



A number of domestic and external 
pressures pose threats to our interests 
in African security. The Soviet Union 
and its surrogates have made the Horn 
of Africa an arena for East- West com- 
petition. They have sustained a costly 
civil war in Angola which has shattered 
the country's economy and seriously de- 
graded the quality of life for innocent 
civilians. The Soviet Union has viewed 
southern Africa as an opportune area 
for its expansionist policies. And it has 
been the preeminent military supplier 
for Libya's Muammer Qadhafi, whose 
southward aggression threatens Chad 
and other sub-Saharan African coun- 
tries. Apartheid will not only continue 
to breed conflict within South Africa, 
but is a primary cause of instability in 
all of southern Africa. 



onciliation and the peaceful resolution 
of conflicts in Angola, Namibia, and 
elsewhere. We will continue to promote 
peaceful progress toward non-racial 
representative democracy in South Af- 
rica, and peace between South Africa 
and its neighbors. We support regional 
economic cooperation among the coun- 
tries of southern Africa and will assist 
collaborative efforts to achieve eco- 
nomic development. We must encourage 
governments to stay the politically 
risky course of economic reform. 

In a region as underdeveloped as 
Africa, which has relatively little access 
to private sources of capital, our ability 
to achieve our objectives depends in 
very significant measure on effective 
economic and security assistance pro- 
grams. Too often security assistance is 



The diversity of Africa embodies a broad range of national security 
interests and presents numerous challenges for the United States. 



Perhaps as in no other region, eco- 
nomic concerns are closely interrelated 
with political stability in Africa. After 
more than two decades of misguided 
statist policies which produced eco- 
nomic deterioration, many African 
countries are now recognizing that mar- 
ket-oriented economic reform is critical 
for renewed growth and development. 
Public reaction to the stringent reforms 
which are now needed will pose another 
kind of threat to political stability, at 
least in the near term. Moreover, Af- 
rica's heavy debt burden has stymied 
the abilities of governments to move be- 
yond economic reform to economic 
growth. 

An effective U.S. strategy toward 
Africa integrates political, military, and 
economic elements. We must continue 
to sustain relationships with our mili- 
tary partners and support regimes 
threatened by Soviet and Libyan aspi- 
rations. We will work for national rec- 



portrayed as a tradeoff against support 
for development. In Africa, this distinc- 
tion is particularly ill-founded. Our se- 
curity assistance programs promote a 
stable political and economic environ- 
ment that permits the exercise of indi- 
vidual choice and the development of 
human talent. Without that environ- 
ment, sustained development is not 
possible. 

U.S. military assistance programs 
in Africa have always been modest, but 
recently funding has been almost elimi- 
nated by Congress. It is in our national 
interest to provide a reasonable level of 
support to moderate, friendly countries 
such as Kenya and Zaire, to regimes on 
the front lines of Soviet-supported ag- 
gression such as Somalia, and to coun- 
tries facilitating access in support of 
our strategies in Southwest Asia and 
the Persian Gulf. 

U.S. military training programs 
are an invaluable instrument for pro- 
moting professionalism and respect for 



human rights. The exposure to Weste 
values that comes from such program 
may foster a respect for the United 
States and democratic institutions 
among individuals who play a key roli. 
in determining the level of freedom a< 
stability in African countries. Many c 
these programs also contribute to ecc 
nomic security. The African Coastal i 
curity Program, for example, provide 
training to West African countries to 
enable them to protect their coastal 
fish stocks from unauthorized foreign' 
fishing fleets. 

The U.S. assistance program in 
South Africa for victims of apartheid 
enacted into law by Congress, helps 
prepare disenfranchised citizens for 
participation in constitutional democ- 
racy and a free enterprise economy i 
post-apartheid South Africa. Our ne^ 
program for regional trade and trans 
port development in the southern Af 
rican states furthers our mutual 
political interests and enables these 
countries to develop alternatives to 
total dependence on South Africa. 

As African countries struggle to 
liberalize and expand their economie; 
market economics are on trial. Our 
challenge is to be able to provide 
enough resources to permit new eco- 
nomic policies to bear fruit and enab 
African countries to become fully int 
grated into the existing world tradin; 
and financial system. A promising st 
has been made with the President's 1 
tiative to End Hunger in Africa, the 
African Economy Policy Reform Pro- 
gram, the Baker Plan providing as- 
sistance on debt, and the Food for 
Progress program. We must ensure 
that our assistance programs and the 
of other donor countries and institu- 
tions give impetus to further progrei 

As part of that effort, we will co 
tinue to work with our Western and 
Japanese partners to find creative so 
tions to the debt problem of countriei 
implementing reforms. Our budgetar 
restrictions limit what we can do di 
rectly, but much is at stake. Althoug 
the aggregate debt is small compared 
to that of Latin America, it has pre- 
vented the growth benefits of econoi 
reform from being realized. 



26 



Department of State Bulirn 



FEATURE 
National Security 



SRATEGY FOR LOW 
rrENSITY CONFLICT 

Viile high intensity conflict has been 
8 cessfully deterred in most regions of 
pmary strategic interest to the 
Lited States, low intensity conflicts 
c: tinue to pose a variety of threats to 
ti achievement of important U.S. ob- 
j( Lives. As described in last year's re- 
p t, low intensity conflict typically 
n nifests itself as political-military con- 
f; ntation below the level of conven- 
t lal war, frequently involving 
r tracted struggles of competing prin- 
rs and ideologies, and ranging from 
- version to the direct use of military 
f. ;e. These conflicts, generally in the 
1 rd World, can have both regional 
a I global implications for our national 
s urity interests. For example: 

• Military basing, access and tran- 
8 rights in the Philippines, key to 

I 5. power projection capabilities in 
t Western Pacific and Indian Oceans, 
i presently threatened by the com- 
r nist insurgency being waged against 
t Philippine Government. 

• In mineral-rich southern Africa, 
i urgencies, economic instability and 
li irtheid, as well as ethnic tribal con- 
I ts, pose potential threats to the ex- 
I ction of essential raw materials and 
t ir export to industries in the West 

i 1 Japan. The conflicts endemic to the 
1 non are exacerbated by the activity 
( the Soviet Union and its surrogates. 

• Soviet, Cuban and Nicaraguan 

i )port for insurgencies in El Salvador 
i i elsewhere in Latin America 
t 'eaten nascent democracies in the re- 
j m which are already struggling with 
«*onic poverty, economic under- 
ivelopment, and the growing influence 
' narcotics cartels. 

• Libya has used the threat of re- 
icting or denying oil shipments to 
mt West European response to state- 
onsored terrorism, while simul- 
leously training terrorists on Libyan 
il. Freedom of action for some U.S. 
ies can be limited by economic ties. 

Our strategies for dealing with low 
ensity conflict recognize that U.S. 
sponses in such situations must be 



realistic, often discreet, and founded on 
a clear relationship between the con- 
flict's outcome and important U.S. na- 
tional security interests. Many low 
intensity conflicts have no direct rele- 
vance to those interests, while others 
may affect them in the most fundamen- 
tal ways. When a U.S. response is 
called for, we take care to ensure that 
it is developed in accordance with the 
principles of international and domestic 
law, which affirm the inherent right of 
states to use force in individual or col- 
lective self-defense against armed at- 
tack; and to assist one another in 
maintaining internal order against in- 
surgency, terrorism, illicit narcotics 
traffic, and other characteristic forms 
of low intensity conflict. 

Consistent with our strategies for 
dealing with low intensity conflict, 
when it is in U.S. interest to do so, the 
United States will: 

• Work to ameliorate the underly- 
ing causes of conflict in the Third World 
by promoting economic development 
and the growth of democratic political 
institutions. 

• Support selected resistance move- 
ments opposing oppressive regimes 
working against U.S. interests. Such 
support will be coordinated with 
friends and allies. 

• T^ke measures to strengthen 
friendly nations facing internal or ex- 
ternal threats to their independence 
and stability by employing appropriate 
instruments of U.S. power. Where pos- 
sible, action will be taken early — before 
instability leads to widespread violence; 
and emphasis will be placed on those 
measures which strengthen the threat- 
ened regime's long-term capabihty to 
deal with threats to its freedom and 
stability. 

• Take steps to discourage Soviet 
and other state-sponsored adventurism, 
and increase the costs to those who use 
proxies or terrorist and subversive 
forces to exploit instability. 



• Assist other countries in the in- 
terdiction and eradication of illicit nar- 
cotics production and traffic. Measures 
which have proven particularly effective 
include aid to expand and improve the 
affected country's law enforcement ca- 
pabilities, to preserve the independence 
and integrity of its judicial system, and 
to provide for the sharing of intel- 
ligence and investigative capabilities. 

Our own military forces have dem- 
onstrated capabilities to engage in low 
intensity conflict, and these capabilities 
have improved substantially in the last 
several years. But the most appropriate 
application of U.S. military power is 
usually indirect through security as- 
sistance — training, advisory help, logis- 
tics support, and the supply of essential 
military equipment. Recipients of such 
assistance bear the primary responsibil- 
ity for promoting their own security in- 
terests with the U.S. aid provided. Our 
program of assistance to El Salvador 
illustrates a successful indirect applica- 
tion of U.S. military power. 

The balanced application of the 
various elements of national power is 
necessary to protect U.S. interests in 
low intensity conflicts. But in the final 
analysis, the tools we have at our dis- 
posal are of little use without the sup- 
port of the American people, and their 
wiUingness to stay the course in what 
can be protracted struggles. We cannot 
prevail if there is a sharp asymmetry of 
wills — if our adversaries' determination 
is greater than our own. At the same 
time we do hold important advantages. 
We represent a model of political and 
economic development that promises 
freedom from political oppression and 
economic privation. If we can protect 
our own security, and maintain an envi- 
ronment of reasonable stability and 
open trade and communication through- 
out the Third World, political, eco- 
nomic, and social forces should 
eventually work to our advantage. 



pril 1988 



M 



27 



V. Executing the Strategy 



The leg:islation requiring this annual re- 
port wisely emphasized the importance 
of discussing not only what our strat- 
egy is, but how well it is supported, 
and whether any significant impedi- 
ments to its execution exist. In a sense, 
this portion of the report is the most 
important, for it brings into focus the 
fundamental issue of whether our strat- 
egy and resources are in balance; and, 
if they are not, whether we should re- 
solve the imbalance by changing the 
strategy, by supporting it more effec- 
tively, or by consciously accepting a 
higher level of risk to our national se- 
curity interest. 

The following paragraphs will dis- 
cuss U.S. capabilities to execute the 
National Security Strategy presented in 
preceding chapters, with particular at- 
tention to those areas where resource 
shortfalls adversely affect our ability to 
execute the strategy in efficient and ef- 
fective ways. 



RESOURCE SUPPORT 

The successful execution of any strat- 
egy depends upon the availability of ad- 
equate resources. This means that we 
must not adopt strategies that our 
country cannot afford; and our diplo- 
mats and military leaders must not 
base their plans on resources that are 
beyond the nation's capability to pro- 
vide. It also means that Congress, op- 
erating from a shared view of U.S. 
national security interests and objec- 
tives, must provide the Executive with 
the resources necessary to implement a 
realistic, prudent, and effective Na- 
tional Security Strategy. Recently, how- 
ever, the Congressional response has 
been inadequate. 

For example, U.S. foreign as- 
sistance, including a balanced mix of 
military and economic assistance, pro- 
motes important national interests and 
helps communicate our values and prin- 
ciples throughout the world. These pro- 
grams convert our regional strategies 



into positive, visible actions which pro- 
vide assistance to people facing severe 
economic privation, and promote the 
economic and political development so 
important to help struggling societies 
evolve in constructive ways. They also 
help governments seeking to defend 
themselves from internal and external 
threats. By helping our friends enhance 
their security, we aid in creating the 
necessary preconditions for economic 
and political development. In short, our 
foreign assistance programs support 
the types of positive change that will 
protect our national interests over the 
long-term. 

We currently spend less than two 
percent of our annual federal budget on 
foreign assistance. This is indisputably 
money well spent. The good we do, the 
problems we help solve, and the threats 
we counter through our assistance pro- 
grams far outweigh the costs. They 
represent a highly leveraged invest- 
ment, with large payoffs for relatively 
small outlays. Nevertheless, our foreign 
assistance programs do not receive the 
support they deserve from the Con- 
gress or from the American people. In 
the last few years, the Administration's 
foreign assistance budget requests have 
been severely cut by the Congress. Al- 
though all programs must bear the bur- 
den of reducing the budget deficit, the 
cuts in foreign assistance have often 
been grossly disproportionate. While 
the federal budget has been growing 
overall, foreign assistance was reduced 
by 29 percent in FY86, an additional 11 
percent in FY87, and faces another re- 
duction in FY88. The security as- 
sistance account now falls significantly 
below the level needed to maintain, 
with no expansion, programs critical to 
our national security interests. 

The problem of inadequate funding 
for foreign assistance is compounded by 
Congressionally mandated earmarks 
and restrictions that take an ever 
larger piece of a shrinking pie. In re- 
cent years, Congressional action has 



earmarked as much as 90 percent of 
certain foreign assistance accounts t( 
specific countries. These and other n 
strictions force us to conduct foreign 
policy wdth our hands tied. We are Ic 
ing the ability to allocate resources a 
cording to our strategic priorities, a: 
we have virtually no leeway to respo 
to emergencies with reallocations of 
funds. The effects of earmarking on i 
developing countries is particularly 
damaging. These smaller programs 
bear a disproportionate share of the 
burden when funds earmarked for iai 
programs are maintained at a constat 
level while the overall assistance pro 
gram is cut. 

The adverse effects of funding c 
are not limited to our foreign develo 
ment and security assistance progra 
To properly coordinate these instru- 
ments and to carry out our policies, 
rely on our diplomatic missions abro 
No foreign policy, no matter how coi 
ceptually brillant, can succeed unles 
is based on accurate information abc 
and correct interpretation of, the de 
opments in countries we are attempi 
to influence. We need to be able to j 
suade others that our goals are worl 
supporting and that our means are ; 
propriate. The essential tasks of inft 
mation, analysis and communication 
the primary responsibility of our em 
bassies and consulates. 

Funds available for operating th 
Department of State and our embas! 
and consulates overseas have been c 
to an unprecedented point. What th: 
means in real terms is fewer people 
work on formulating and implement! 
the nation's foreign policy at all leva 
It means fewer diplomatic and consu 
posts — posts which are the eyes and 
ears of the U.S. Government abroad It 
means not providing the country wil 
the level of services, reporting, anal 
sis, or the representation and protec 
tion of global U.S. interests that we 
have come to expect. 

It cannot be stressed too strong' 
that our diplomatic establishment ar, 
our foreign assistance programs are n 
essential part of our political and ec 
nomic elements of power. We cannot 
support our National Security Strat ;> 



28 



Department of State Buluir 



FEATURE 
National Security 



thout them. They work to resolve 
isions and ameliorate conflicts that, 
ignored, could degenerate into crises 
versely affecting U.S. interests. Un- 
•s we are willing to be an active par- 
ipant in promoting the type of world 
der we desire, we may find ourselves 
mpelled to defend our interests with 
tre direct, costly, and painful means, 
ngressional action to shore up sup- 
1 rt for this weakened link in our ca- 
) bility for strategy execution should 
1 'eive high priority attention. 

Adequate and sustained resource 
I aport is also needed for our defense 
1 jgi'ams. Providing for the common 
I fense is the most important responsi- 
ity of the federal government — 
ired equally by the Executive and 
gislative branches. Partnership is the 
y to its successful execution. In that 
irit, in the early 1980s — for the third 
le since World War II — Congress and 
? Executive joined in a concerted 
ort to rebuild and strengthen our 
litary capabilities. It was clear at 
at time that only an increase in de- 
ise investment would produce the 
cessary sustained impact on the mili- 
ry balance, and redress the serious 
5parities between U.S. and Soviet ca- 
bilities which had emerged during 

♦ e 1970s — a period of unprecedented 
litary investment by the Soviets 

Tied at shifting the global "correlation 
forces" in a decisive and irreversible 
iv. Fortunately, the Congress and the 
Tierican people recognized the criti- 
lity of rebuilding the country's de- 
nses, and we made impressive 
ogi-ess. Having arrested the adverse 
' end, however, the challenge then be- 
■' me not to lose the momentum 
lined — always a difficult task in a de- 
ocracy. Unfortunately, we have not 

• )ne as well in that regard. 

■': When I submitted the FY88 Bud- 
it a year ago, I did not ask the Con- 
"ess to approve Defense funding 
creases of the magnitude that charac- 
'■rized those of the early 1980s. At the 
'ime time, I did emphasize that Con- 
fess must act positively to protect the 
ains that we together had achieved. In 
larticular, I stressed that we must not 
4mtinue on the path of decline in real 



defense spending established during 
the preceding two years. With lack of 
perspective, we had begun a process of 
reversing the improvements in the 
U.S. -Soviet balance achieved during 
the early 1980s. Regrettably, this proc- 
ess continued with the legislative action 
on the FY88 budget. 



to bring the conflict to early termina- 
tion by exerting military pressures on 
the Soviets from several directions. It 
increases the likelihood that force lim- 
itations will require us to conduct se- 
quential operations in successive 
theaters, with the risk and uncertainty 
which that approach entails. 



The resources needed to support our national strategy, at a prudent 
level of risk, are within our ability to pay. 



] 



While the Defense figures coming 
out of the "budget summit" were signif- 
icantly less damaging than would have 
been the case had sequestration oc- 
curred, they continued the downward 
trend of the Defense Budget, in real 
terms, for the third year in a row. So- 
viet spending, on the other hand, main- 
tained its historical pattern of real 
growth on the order of 3.5 percent an- 
nually during this period of U.S. de- 
chne. The unfortunate consequence is 
that sometime in the future the Ameri- 
can people will again be asked to sup- 
port defense capabilities for which they 
thought they had once paid. In the 
meantime, the inefficient procurement 
rates associated with instability and re- 
duced budgetary resources exacerbate 
the impact of the Defense Budget cuts. 

The FY88 cuts, coming on top of 
two prior years of decline, have con- 
fronted us with a situation in which we 
must now either reduce the readiness 
of our forces, or lower investment and 
eliminate force structure in order to al- 
low our remaining military units to 
function at an acceptable level of com- 
bat capability. Either way, risk will 
grow, and deterrence will be reduced. 

The strategic implication of this 
continuing decline is that U.S. forces 
will confront additional risk in regions 
where the potential exists for high- 
intensity conflict, and particularly in 
their ability to conduct high-intensity 
operations in more than one theater si- 
multaneously. In global conflict this 
could require us to forego opportunities 



Some will argue that the cuts do 
not really injure our defense capability; 
that with greater imagination and a 
willingness to innovate, we can do more 
with less in the defense area. In this 
view, more thoughtful military strat- 
egy, improved tactics, or changed em- 
phasis in force structure, can 
compensate for reduced resource levels. 
In fact, our commanders work continu- 
ously to find better ways to use the 
forces we have. With our allies, we con- 
stantly strive to improve force effec- 
tiveness, to capitalize on Soviet 
vulnerabihties, and to employ com- 
petitive strategies which exploit our 
technological, geographic or other ad- 
vantages to stress the Soviets' system 
and require them to make disadvan- 
tageous investments. We seek out new 
ideas on military strategy and force 
employment, and adopt those which 
promise real gains in military effective- 
ness; but we should be under no illu- 
sions that there are quick fixes which 
can fundamentally reduce our current 
military requirements. 

In this regard, it is noteworthy 
that — pursuant to recommendations of 
the 1986 Blue Ribbon Panel on Defense 
Management — the Joint Chiefs of Staff 
over the past year have conducted a 
global net assessment of U.S. and So- 
viet capabilities and reviewed the na- 
tional military strategy to examine 
whether alternative approaches could 
improve our overall military capability 
at a given budget level. They concluded 
that none of the particular alternatives 



iiDpril 1988 



29 



examined was as effective as the ca- 
pabilities generated under current 
plans and strategy. 

That is not surprising given the 
fact that our military strategy and sup- 
porting force structure are based on 
certain fundamental conditions which 
change slowly, if at all. These include 
the immutables of geography; the divi- 
sion of labor entailed in our alliance re- 
lationships; our advantage in certain 
advanced technologies; the large capital 
investment we have in existing forces; 
and the evolution of the threat. We will 
continue to review our military strat- 
egy to revalidate and update its essen- 
tial elements. But in our deliberations 
we need to distinguish between soundly 
analyzed recommendations for improve- 
ments in U.S. or allied strategy — which 
can be helpful — and those that simply 
call for a strategy which costs less, 
without regard to the range of security 
interests it can assure. 

Another way sometimes suggested 
to compensate for reduced resource lev- 
els is to scale back U.S. commitments. 
But commitments are not an end in 
themselves; they are simply ways of 
protecting U.S. interests and achieving 
the objectives of our National Security 
Strategy. 

While details of those interests and 
objectives may vary over time, as noted 
in the first chapter of this report their 
core elements have changed little since 
the 1950s. No one seriously advocates 
abrogation of our treaty relationships 
with the NATO nations, Japan, the 
Phihppines, Thailand, Australia, or our 
Hemispheric neighbors. Nor do respon- 
sible voices argue against our strategic 
relationship with Israel, our friendly 
ties with Egypt, or our cooperative re- 
lations with other moderate Arab 
states. The regional strategy sections of 
this report illustrate how our diplo- 
matic, economic, and military rela- 
tionships with these and other key 
countries interact to support fundamen- 
tal U.S. interests and objectives. While 
there may be room for adjustments at 
the margin in our contributions to re- 
gional security, none of our current 
commitments are plausible candidates 



30 



for major reduction, given the scope of 
our global interests, the threats to 
those interests, and the increasingly in- 
terdependent nature of free world polit- 
ical, economic, and security 
relationships. Both Congress and the 
Executive Branch should continue to 
review our commitments worldwide, 
but I see no prudent way to reduce 
those commitments while remaining 
true to our values, maintaining essen- 
tial and usually beneficial alliance rela- 
tionships, and safeguarding our future. 

This does not imply that the 
United States is necessarily satisfied 
with the contributions which our allies 
and friends make to the common de- 
fense in those regions where we have 
major military commitments. In Eu- 
rope in particular, our NATO allies can 
and should do more to enhance Alliance 
conventional defense capabilities. We 
will continue to press them for more 
appropriate levels of defense invest- 
ment and improved efficiency in the use 
of Alliance resources, while rejecting 
the self-defeating argument that the 
failure of some allies to meet agreed 
goals should prompt us to reduce our 
own contribution to Alliance ca- 
pabilities. We are in Europe because it 
is in our interest to be there; and, 
within the limits of Congressional fund- 
ing, we will continue to contribute 
those forces which we believe are es- 
sential to the support of our national 
security interests and objectives. At 
the same time we expect our allies to 
show an equal interest in the common 
defense, and to recognize the need to 
take on an increasing share of the bur- 
den as we work together to improve 
NATO's conventional defense capability 
and the plans for employing it. 

Finally, I should note that the de- 
fense program required to support our 
strategy is eminently affordable. In 
fact, in the past seven years. Ameri- 
cans have devoted an average of only 
6.1 percent of gross national product 
(GNP) to national defense — well under 
rates in the 1950s and 1960s, which 
averaged about 10 percent. Similarly, at 
about 28 percent of federal outlays, de- 
fense spending falls well below the 
peacetime average of 41 percent during 



the postwar era. In both instances, tl 
increases of the early 1980s seem larg 
only because the spending of the late 
1970s, which averaged less than 5 per 
cent of GNP, was so severely de- 
pressed. The resources needed to 
support our national strategy, at a pr 
dent level of risk, are within our abih 
to pay. Failure to provide these re- 
sources simply defers to future budgt 
the task of regaining lost ground, wh 
increasing risks to our security in the 
near-term. 



BIPARTISAN COOPERATION 

The continued development and suc- 
cessful execution of U.S. National Se 
curity Strategy is a major 
responsibility of the Executive Branc 
But, as the foregoing discussion has 
emphasized, we cannot accomplish th 
alone. Supporting a security strategy 
that provides a sound vision for the f 
ture and a realistic guide to action m 
be a cooperative endeavor of the Ad- 
ministration and the Congress. 

In this regard, I believe both 
branches need to review their constit 
tional roles and the relationship be- 
tween them in the national security 
area. There are important powers hei 
some that are best shared, some that 
are Presidential responsibilities. Afti 
seven years in office, I am convinced 
that the numerous consultative ar- 
rangements established between the 
two branches in areas such as arms n 
gotiations, intelligence, and mihtary 
contingency operations generally repi 
sent the best way to coordinate our 
views and resolve our differences. We 
should continue to look for ways to iir 
prove these arrangements; but they a 
far superior to more rigid structural i 
ternatives that, in response to a speci 
set of circumstances, would attempt t 
define in law the precise constitution; 
boundaries of Executive and Legislati 
authority which the Founding Fathers 
purposely left in broad terms. 



Department of State Bullet 



FEATURE 
National Security 



Equally detrimental is the increas- 
a tendency of the Congress to act in a 
dective manner with regard to details 

breign, defense, and arms control 

p icy, limiting the flexibility of the Ex- 
e tive Branch by enacting into law 
p litions on which the President should 
b allowed reasonable discretion. This 
t nd diminishes our ability to conduct 
r ional and coherent policies on the 
V rid scene; reduces our leverage in 
c ;ical negotiations; and impedes the 
ii jgrated use of U.S. power to achieve 
i] )ortant national security objectives. 

1 ;auses others to view us as unrelia- 
t , and diminishes our influence 

g lerally. 

In addition, I would suggest that 
t Congress reconsider how it can best 
c ;anize itself for fulfilling its Constitu- 
t lal role. Over the past twenty years, 
I ver and authority have effectively 
t fted away from experienced lead- 
( hip and committee chairmen, and to- 
\ rd individual members and special 
i erest coalitions. From a Congres- 
i nal perspective, Cabinet Secretaries 
i 1 White House advisers may present 
( erse points of view while policy is in 
t ' formative state; but the President 
i '.aks with authority once policy deci- 
i ns are made. The President, how- 
i ir, faces a far different situation in 
( iling with Congress. In approaching 



the Congress as a partner in the for- 
mulation of national security policy, the 
President must have confidence that 
the Legislative branch leadership is ca- 
pable of implementing any consensus 
that is reached, without being second- 
guessed or undercut by autonomous 
members or interest groups. 

This suggests the need for other 
legislative reforms. I have often empha- 
sized that restoring and maintaining an 
adequate military balance, and fulfilling 
our international obligations, requires a 
long view and fiscal stability. This is 
not accomplished in a repetitive and 
topsy-turvy annual budget cycle. We 
must face squarely the need for multi- 
year authorizations and appropriations, 
consistent with constitutional limita- 
tions, in order to support our national 
security and international affairs pro- 
grams more efficiently and effectively. 
While some progress has been made, 
particularly with the recent adoption 
by the Congress of a partial two-year 
defense authorization bill, much more 
can and should be done. In this regard, 
it is important to recall the conclusion 
of the Blue Ribbon Commission on De- 
fense Management that, in the future, 
significant efficiencies in the defense 
budget are more likely to be achieved 
through greater program stability than 
through specific management improve- 
ments by the Department of Defense. 



Above all, we must both work 
harder to rebuild a bipartisan public 
consensus on our National Security 
Strategy and the resources needed to 
execute it. The fundamental policies 
and strategies we have pursued are 
similar to, and consistent with, those 
pursued by previous generations of 
American leaders. Renewed consensus 
will be forged on the anvil of public 
debate — among responsible officials in 
government, between the Congress and 
the Executive, in consultations with 
our allies and friends, and among the 
larger community of interested and con- 
cerned American citizens. We look for- 
ward to that debate and to working 
with the Congress to achieve increased 
understanding of, and broad support 
for, our National Security Strategy. 
There can be no endeavor more impor- 
tant for the long-term well-being of 
the American people; and I solicit the 
Congress' closest collaboration in 
achieving it. 



Released by the White House in January 
1988. ■ 



}ril 1988 



31 



THE PRESIDENT 



Peace and Democracy for Nicaragua 



President Reagan's address to the 
nation on February 2, 1988J 

I want to begin tonight by telling a 
story, a true story of courage and hope. 
It concerns a small nation to our 
south — El Salvador — and the struggle 
of its people to throw off years of vio- 
lence and oppression and live in 
freedom. 

The El Salvador Example 

Nearly 4 years ago, I addressed you as 
I do tonight and asked for your help in 
our efforts to support those brave peo- 
ple against a communist insurgency. 
That was one of the hardest-fought po- 
litical battles of this Administration. 
The people of El Salvador, we heard, 
were not ready for democracy; the only 
choice was between the left-wing guer- 
rillas and the violent right, and many 
insisted that it was the guerrillas who 
truly had the backing of the people. 

But with your support, we were 
able to send help in time. Our package 
of military aid for El Salvador passed 
Congress by only four votes — but it 
passed. Some of you may remember 
those stirring scenes as the people of 
El Salvador braved communist gunfire 
to turn out in record numbers at the 
polls and vote emphatically for 
democracy. 

Observers told of one woman, 
wounded in a communist attack, who 
refused to leave the Une at the polls to 
have her wounds treated until after she 
had voted. They told of another woman 
who defiantly answered communist 
death threats saying, "You can kill me, 
you can kill my family, you can kill my 
neighbors, but you can't kill us all." 
That is the voice of a people determined 
to be free. That is the voice of the peo- 
ple of Central America. 

In these last several years, there 
have been many such times when your 
support for assistance saved the day for 
democracy The story of what has hap- 
pened in that region is one of the most 
inspiring in the history of freedom. To- 
day El Salvador, Honduras, Guatemala, 
as well as Costa Rica, choose their gov- 
ernments in free and open democratic 
elections. Independent courts protect 
their human rights, and their people 
can hope for a better life for themselves 
and their children. It is a record of suc- 
cess that should make us proud. But 
the record is as yet incomplete. 



32 



Sandinista Threat to Regional Peace 

This is a map of Central America. As I 
said, Guatemala, Honduras, El Sal- 
vador, and Costa Rica are all friendly 
and democratic. In their midst, how- 
ever, lies a threat that could reverse 
the democratic tide and plunge the re- 
gion into a cycle of chaos and subver- 
sion. That is the communist regime in 
Nicaragua called the Sandinistas — a re- 
gime whose allies range from commu- 
nist dictator Fidel Castro of Cuba to 
terrorist-supporter Qadhafi of Libya. 
But their most important ally is the 
Soviet Union. 

With Cuban and Soviet-bloc aid, 
Nicaragua is being transformed into a 
beachhead for aggression against the 
United States; it is the first step in a 
strategy to dominate the entire region 
of Central America and threaten Mex- 
ico and the Panama Canal. That is why 
the cause of freedom in Central Amer- 
ica is united with our national security. 
That is why the safety of democracy to 
our south so directly affects the safety 
of our own nation. 

But the people of Nicaragua love 
freedom just as much as those in El 
Salvador. You see, when it became 
clear the direction the Sandinistas were 
taking, many who had fought against 



the old dictatorship literally took to tin 
hills and, like the French Resistance (f 
that fought the Nazis in World War LJe! 
they have been fighting the communis. 
Sandinistas ever since. iji 



Contra Struggle and Peace 
Negotiations 



These are the forces of the democrati|E 
resistance — the communist governmeiii: 
named them contras, but the truth [s\): 
they are freedom fighters. Their tens 
cious struggle has helped buy the sui 
rounding democracies precious time 
and, with their heroic efforts, they ai' r 
helping give freedom a chance in Nic- iti 
aragua. A year-and-a-half ago. Con- 
gress first approved significant milita 
aid for the freedom fighters. Since th ' 
they've been winning major victories ii; 
the field and doing what many at firs it 
thought impossible — bringing the cor m 
munist Sandinistas to the negotiating iis 
table and forcing them to negotiate m; 
seriously. '; 

From the beginning, the United 
States has made every effort to negn 
ate a peace settlement — bilaterally, 
multilaterally, in other diplomatic set 
tings. My envoys have traveled to th 
region on at least 40 different occa- 
sions. But until this last year, these 
negotiations dragged on fruitlessly b 
cause the Sandinistas had no incenti' 
to change. Last August, however, wi 



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7468 3-88 STATE (INR/GE) 



Department of State Bull* 



THE PRESIDENT 



iitiiig pressure from the freedom 
ati-8, the Sandinistas signed the 
iiitemala peace plan. 

This time, the leaders of the four 
'^tral American democracies refused 
!t the peace negotiations become an 
•ii'ty exercise. When Nicaragua 
oiied the second deadline for com- 
jlirice, the democratic leaders cou- 
•a;ously stood as one to insist that 
h Sandinistas live up to their signed 
omitments to democratic reform, 
n ir failure to do so, said the demo- 
T ic leaders, was the biggest obstacle 
eace in the region. The Sandinistas 
ir clearly feeling the pressure and are 
M inning to take limited steps. 

J . Support Package 

Ii at this crucial moment, there are 
Y se who want to cut off assistance to 
i freedom fighters and take the pres- 
ii ; off. Tomorrow the House of Repre- 
n ;atives will be voting on a 
S« million bill — a support package to 
i freedom fighters. Ninety percent is 
i nonlethal support such as food, 
'i hing, and medicine and the means 
;< leliver it. Ten percent is for am- 
i lition. That amount will be sus- 
> ded until March 31st to determine 
R !ther the Sandinistas are taking ir- 
rt jrsible steps toward democracy. I 
E hopeful this will occur. However, if 
;! re is no progress toward a negoti- 
i i cease-fire, I will make a decision 
K -elease these additional supplies — 
[) only after weighing carefully and 
CJ roughly the advice from Congress 
I : the democratic presidents of Cen- 
: ! America. 

Over the past several days, I have 
a t with many Members of Congress — 
E publicans and Democrats — concern- 
ii my proposal. In the spirit of bipar- 
t inship, I will tomorrow send a letter 
t the congressional leadership taking a 
(jther step. At the appropriate time, I 
J 1 invite Congress to act by what is 
cled a sense-of-Congress resolution on 
t ! question of whether the Govern- 
li nt of Nicaragua is in compliance 
;h the San Jose declaration. If Con- 
3ss adopts such a resolution within 10 
ys containing this finding, then I will 
nor this action and withhold deliv- 
es of ammunition in this package. 
16 thing is clear; those brave freedom 
hters cannot be left unarmed against 
mmunist tyranny. 

Some say that military supplies are 
t necessary, that humanitarian aid is 
ough. But there is nothing human- 
irian about asking people to go up 
ainst Soviet helicopter gunships with 
'thing more than boots and bandages. 



There is no vote scheduled tomorrow in 
the Soviet Union on continued as- 
sistance to the Sandinistas; that as- 
sistance wall continue, and it will not be 
just humanitarian. 

Our policy of negotiations, backed 
by the freedom fighters, is working. 
Like the brave freedom fighters in 
Afghanistan who have faced down the 
Soviet Army and convinced the Soviet 
Union that it must negotiate its with- 
drawal from their country, the freedom 
fighters in Nicaragua can win the day 
for democracy in Central America. But 
our support is needed now; tomorrow 
will be too late. If we cut them off, the 
freedom fighters will soon begin to 
wither as an effective force. Then, with 
the pressure lifted, the Sandinistas will 
be free to continue the consolidation of 
their totalitarian regime, the military 
buildup inside Nicaragua, and commu- 
nist subversion of their neighbors. 
Even today, with the spotlight of world 
opinion focused on the peace process, 
the Sandinistas openly boast that they 
are arming and training Salvadoran 
guerrillas. 

We know that the Sandinistas, who 
talk of a revolution without borders 
reaching to Mexico, have already infil- 
trated guerrillas into neighboring coun- 
tries. Imagine what they will do if the 
pressure is lifted. What will be our re- 
sponse as the ranks of the guerrillas in 
El Salvador, Guatemala, even Honduras 
and unarmed Costa Rica, begin to swell 
and those fragile democracies are 
ripped apart by the strain? By then the 
freedom fighters will be disbanded, ref- 
ugees, or worse — they will not be able 
to come back. 

Concerns for U.S. National Security 

Let me explain why this should be and 
would be such a tragedy, such a danger 
to our national security. If we return to 
the map for a moment, we can see the 
strategic location of Nicaragua. Close 
to our southern border, within striking 
distance of the Panama Canal, domina- 
tion of Central America would be an 
unprecedented strategic victory for the 
Soviet Union and its allies. And they're 
willing to pay for it. Cubans are now in 
Nicaragua constructing military facili- 
ties, flying combat missions, and help- 
ing run the secret police. The Soviet 
Union and Soviet-bloc countries have 
sent over $4 billion in arms and military 
aid and economic aid — 20 times the 
amount that the United States has pro- 
vided the democratic freedom fighters. 
If Congress votes tomorrow against 
aid, our assistance will very quickly 
come to an end — but Soviet deliveries 
will not. 



We must ask ourselves why the So- 
viet Union, beset by an economic crisis 
at home, is spending billions of dollars 
to subsidize the military buildup in Nic- 
aragua. Backed by some 2,000 Cuban 
and Soviet-bloc advisers, the Sandinista 
military is the largest Central America 
has ever seen. Warsaw Pact engineers 
are completing a deep-water port on 
the Caribbean coast — similar to the 
naval base in Cuba for Soviet sub- 
marines — and the recently expanded 
airfields outside Managua can handle 
any aircraft in the Soviet arsenal, in- 
cluding the Bear bomber, whose 5,200- 
mile range covers most of the continen- 
tal United States. 

Sandinista Military "5-Year Plan" 

But this is only the beginning. Last 
October a high-ranking Sandinista of- 
ficer, Roger Miranda, defected to this 
country, bringing with him a series of 
5-year plans — drawn up among the 
Sandinistas, Soviets, and Cubans — for a 
massive military buildup in Nicaragua 
extending through 1995. These plans, 
which Major Miranda makes clear are 
to be put into effect whether the free- 
dom fighters receive aid or not, call for 
quadrupling the Sandinista armed 
forces — to 600,000, or one out of every 
five men, women, and children in the 
country. 

As I speak to you tonight, several 
thousand Nicaraguans are taking 
courses in the Soviet Union and Cuba 
to learn to operate new high-tech mis- 
siles, artillery, and other advanced 
weapons systems. Of grave concern is 
the fact that the Soviets have scheduled 
delivery of Soviet MiG aircraft to Nic- 
aragua. If these were just the claims of 
one defector, no matter how highly 
placed and credible, some might still 
find reason to doubt. But even before 
Major Miranda's revelations were made 
public, his old boss. Defense Minister 
Humberto Ortega, confirmed them in a 
public speech — adding that if Nicaragua 
chose to acquire MiGs, it was none of 
our business. 

The introduction of MiGs into Nic- 
aragua would be so serious an escala- 
tion that members of both parties in 
the Congress have said the United 
States simply cannot tolerate it. 

Sandinista "Promises" 

The Miranda revelations cannot help 
but make us skeptical of the recent 
Sandinista promises to abide by the 
Guatemala peace accord. The argument 
is made that the freedom fighters are 
unnecessary, that we can trust the 



)ril 1988 



33 



THE PRESIDENT 



Sandinistas to keep their word. Can 
we? It is important to remember that 
we already have a negotiated settle- 
ment with the Sandinistas — the settle- 
ment of 1979 that helped bring them to 
power, in which they promised — in 
writing — democracy, human rights, and 
a nonaligned foreign policy. 

Of course, they haven't kept a sin- 
gle one of those promises, and we now 
know that they never intended to. 
Barely 2 months after assuming power, 
the Sandinista leadership drafted a se- 
cret report, called the '"72-hour docu- 
ment," outlining their plans to establish 
a communist dictatorship in Nicaragua 
and spread subversion throughout Cen- 
tral America. This is the document in 
which they detailed their deception. It 
is now part of the public record, avail- 
able for all to see. 

One day after that 72-hour meet- 
ing. President Carter, unaware of their 
secret plans, received Daniel Ortega 
here in the White House and offered his 
new government our friendship and 
help, sending over $100 million aid, 
more than any other country at the 
time, and arranging for millions more 
in loans. The Sandinistas say it was 
U.S. belligerence that drove them into 
the hands of the Soviets. Some 
belligerence. 

A short while later, the Sandinista 
comandantes made their first official 
trip to Moscow and signed a communi- 
que expressing support for the foreign 
policy goals of the Soviet Union. But 
that, one might say, was only the pa- 
perwork. Already Soviet military plan- 
ners were in Nicaragua, and the 
Sandinista subversion of El Salvador 
had begun — all while our hand was ex- 
tended in friendship. 

This is not a record that gives one 
much faith in Sandinista promises. Re- 
cently Daniel Ortega was up in Wash- 
ington again, this time talking to 
Members of Congress, giving them as- 
surances of his commitment to the 
Guatemala peace process. But we now 
know that at the same time, back in 
Managua, the Sandinistas were drawing 
up plans for a massive military escala- 
tion in Nicaragua and aggression 
against their neighbors. 

As the Sandinistas see the vote on 
aid to the freedom fighters nearing, 
they are making more promises. For- 
give my skepticism, but I kind of feel 
that every time they start making 
promises, like that fellow in the Isuzu 
commercial, there should be subtitles 
under them telling the real story. 



One may hope they're sincere this 
time, but it hardly seems wise to stake 
the future of Central America and the 
national security of the United States 
on it. The freedom fighters are our in- 
surance policy in case the Sandinistas 
once again go back on their word. The 
Sandinistas themselves admit that the 
limited steps they have taken to comply 
with the peace accords were promised 
in order to influence the vote in Con- 
gress. Was there ever a better argu- 
ment for aid? 

Even now, with the entire world 
watching, the Sandinistas have ha- 
rassed and beaten human rights activ- 
ists and arrested several leaders of the 
peaceful democratic opposition, includ- 
ing the editor of La Prensa. Before be- 
ing interrogated, some were sealed for 
over an hour in metal lockers, 3 feet 
square on the floor and 7 feet high. 
Said one comandante of the opposition, 
they are "scorpions. They should return 
to their holes, or we will crush them." 

Just a short while ago, the San- 
dinistas made their true intentions 
clean Even if they were forced to hold 
elections and lost, they said they would 
never give up power. Responding to the 
estimate that the Sandinistas have no 
more than 15% popular support, an- 
other comandante responded by say- 
ing, "That's all right. We can hold on to 
power with only 5%." These are not the 
words, they are not the actions of dem- 
ocratic reformers. 

Those who want to cut off the free- 
dom fighters must explain why we 
should believe the promises the San- 
dinista communists make trying to in- 
fluence Congress but not the threats 
they make at home. They must explain 
why we should listen to them when 
they promise peace and not when they 
talk of turning all Central America into 
one "revolutionary fire" and boast of 
carrying their fight to Latin America 
and Mexico. 

If we cut off aid to the freedom 
fighters, then the Sandinistas can go 
back to their old ways. Then the nego- 
tiations can become, once again, what 
they were before — high-blown words 
and promises and convenient cover 
while the Sandinista communists con- 
tinue the consolidation of their dic- 
tatorial regime and the subversion of 
Central America. 

Contra Successes 

During the last vote in Congress, many 
who voted for aid to the freedom fight- 
ers set conditions on further assistance. 
They said the freedom fighters must 



show that they are a viable fighting 
force and win support from the peopl 
The latest victory in the Las Minas 
area proved that. For several weeks, 
nearly 7,000 freedom fighters maneu- 
vered in secret throughout the coun- 
try — something they could only have 
done with support of the population, 
one of the largest military operations 
Nicaraguan history, they overran en- 
emy headquarters, routed army bar- 
racks, and blew up ammunition dump 
petroleum tanks, and other military 
targets. At one point, they captured 
warehouse where grain was being 
hoarded for the army. The freedom 
fighters opened the doors and invitee 
the hungry people of the area to take 
what they needed. 

The freedom fighters are inside 
Nicaragua today because we made a 
commitment to them. They have dent 
what Congress asked; they have prov 
their effectiveness. Can we, as a mor 
people, a moral nation, withdraw tha 
commitment now and leave them at t 
mercy of the Sandinista regime? Or 
turn them forever into refugees — refi 
gees from the country for which the\ 
are making such a heroic sacrifice? 
What message will that send to the 
world, to our allies and friends in frc 
dom? What message will it send to oi 
adversaries? That America is a fair- 
weather friend, an unreliable ally? 
Don't count on us, because we may n 
be there to back you up when the go 
gets a little rough. 

By fighting to win back their coi 
try, the freedom fighters are prevent 
the permanent consolidation of a Sov 
military presence on the American 
mainland; by fighting for their freedc 
they are helping to protect our natioi 
security. We owe them our thanks, nc 
abandonment. 

Some talk of "containment," but 
must not repeat the mistake we mad^ 
in Cuba. If "containment" did not wn 
for that island nation, how much less 
effective will it be for an expansionis 
Soviet ally on the American mainlam 
I will tell you truthfully tonight, thei 
will be no second chances tomorrow. 
Congress votes down aid, the freedoi 
fighters may soon be gone and, with 
them, all effective pressure on the 
Sandinistas. 

Our goal in Nicaragua is simple- 
peace and democracy. Our policy has 
consistently supported the efforts of 
those who seek democracy throughoi 
Central America and who recognize 
that the freedom fighters are essenti: 
to that process. 



34 



Department of State Bullfi 



THE SECRETARY 



iclusion 

■^1 my fellow Americans, there can be 
ifcnistake about this vote: It is up or 
io n for Central America; it is win or 
01 for peace and freedom; it is yes or 
ic America's national security. 

My friends, I have often expressed 
-n belief that the Almighty had a rea- 
so for placing this great and good 
!al, the "New World," here between 
•? vast oceans. Protected by the seas, 
have enjoyed the blessings of 
.f -free for almost two centuries 
i( from the tragedy of foreign aggres- 
si I on our mainland. Help us to keep 
:h , precious gift secure. Help us to 
w support for those who struggle for 
th same freedoms we hold dear. In 
di ig SO, we will not just be helping 
:\ Ti; we will be helping ourselves, our 
cl dren, and all the peoples of the 
w Id. We will be demonstrating that 
A erica is still a beacon of hope, still a 
li t unto the nations. Yes, a great op- 
P' tunity awaits us, an opportunity to 
si w that hope still burns bright in this 
h 1 and over our continent, easting a 
g V across the centuries, still guiding 
n sions — to a future of peace and 
fi idom. 



The Struggle Against Terrorism 



'Te.xt from Weekly Compilation of 
P sidential Documents of Feb. 8, 1988. 



Secretary Shultz's address before 
the Anti- Defamation League of B'nai 
B'rith on the occasion of receiving the 
Joseph Prize for Human Rights in 
Palm Beach, Florida, on February 12, 
1988A 

From time to time, people — especially 
our friends abroad — have asked me 
what does human rights have to do 
with American foreign policy? Well, the 
answer is straightforward. Human 
rights are at the heart of our foreign 
policy because human rights are at the 
heart of our constitution as a nation. 

Last year, celebrating the Con- 
stitution's bicentennial. President Rea- 
gan called our national charter a 
"covenant with all mankind." America 
holds at the center of its values the 
worth and dignity of the individual. We 
are a great nation because we have 
never forgotten our faith in the unique 
value of every human being. And our 
public policy — if we are to be true to 
ourselves — must always reflect that 
faith and commitment. Our advocacy of 
human rights is, therefore, a natural 
part of our foreign policy. The denial of 
those rights, whether through unjust 
laws or unjust action, arouses our an- 
ger and offends our sense of justice. 

Of course, as the times change, so 
does the challenge to human rights. 
Two centuries ago, it meant revolution, 
speUing out fundamental principles in 
our Constitution. Today, we continue to 
observe those fundamental principles. 
Two decades ago, it meant civil rights 
and opening America's promise to all of 
our citizens. Ten years ago, it meant an 
international code at Helsinki, politi- 
cally binding on all the participants — 
including the Soviet Union. Today, we 
continue our commitment to that ideal. 
And when I meet Soviet Foreign Minis- 
ter Shevardnadze in Moscow later this 
month, human rights, including the 
plight of Soviet Jewry, including the 
plight of those who are divided from 
their husbands or wives, will be at the 
very top of my agenda. 

In this decade, an important part 
of the struggle for human rights has 
also meant the struggle against ter- 
rorism. This is because the terrorist 
uses innocent human beings the way a 
smoker uses matches. People become 
throwaways. They are stripped of their 
humanity; used, then abandoned. Noth- 
ing could be more repugnant to Amer- 
ica's commitment to the rights and 
dignity of the individual. 



Fortunately, we are not alone in 
the fight against terrorism. Among our 
allies, Israel, in particular, has shown 
us a great example. Courage, skill, and 
public support are the watchwords of 
the Israeh effort against terrorism. We 
have been proud to work with Israel on 
this problem, and we will continue to 
do so. When the story is written of how 
the democracies beat the terrorists, let 
our names appear together. 

Today I want to update you on our 
struggle against terrorism. I want to 
tell you, as clearly as I can, that the 
right policies are in place. Not only are 
they in place, they are working. It's 
been a tough fight, and we have had 
our share of bitter experiences. But it 
is paying off. 

Tb succeed against terrorism, we 
have to understand the terrorists' aims 
and strategy and how terrorism affects 
us. That comes first. Second, we need 
timely and accurate intelligence. That 
often means pooling resources with 
other concerned governments. Third, 
we must strengthen security measures 
to protect American citizens from ter- 
rorist attack at home and abroad. And 
fourth, very important, defense is not 
enough. We have to go on the offensive 
to disrupt terrorist operations, destroy 
their networks, and bring them to 
justice. 

Understanding Terrorist 
Aims and Strategy 

So, first, we must understand terrorist 
aims and strategy. The facts show that 
most acts of terrorism are committed 
against the citizens of the democracies. 
That is not just because they oppose 
our policies. Terrorists are drawn to at- 
tack democracies because they believe 
they can turn our regard for human 
rights into a vulnerability. They try to 
play our compassion for the innocent 
against our instinct for self-defense. 
The terrorists say to us, "Look, it's 
very simple. Change your policy, and 
no more planes are hijacked. Figure 
out a way to give us what we want, and 
no more children will be killed. We'll 
release your hostages if you free our 
brothers or pay us a ransom. After all, 
injustice has made us desperate." 
That's the con job they try to put over 
on you. 

Our first response to this challenge 
must be clear thinking. Terrorism natu- 
rally arouses our emotions, our anger, 
our compassion. I have felt it, and you 
have felt it. 1 am saying, however, that 



)ril 1988 



35 



THE SECRETARY 



hard as it may be, the best approach to 
countering terrorism is to act with cool 
reason and cold calculation. 

Let me take, for example, what is 
sometimes called the Stockholm syn- 
drome. Psychologists have noted that 
individuals held hostage often begin to 
sympathize with the cause of their cap- 
tors. Nations, not just individuals, are 
vulnerable to this syndrome. After all, 
if men are so desperate that they com- 
mit indiscriminate violence, should we 
not reexamine their grievances? So 
there are those who conclude that ter- 
rorism is an inevitable response to un- 
resolved political and social problems. 

Cool reason, however, leads us to a 
different conclusion. If we think clearly 
about terrorism, we see the fatal fallacy 
in the slogan "one man's terrorist is an- 
other man's freedom fighter." As Scoop 
Jackson often reminded us, no cause 
justifies attacking the innocent. Free- 
dom fighters do not hijack or blow up 
civilian airplanes. Freedom fighters do 
not shoot people in wheelchairs and 
toss them into the sea. Freedom fight- 
ers do not take teachers and journalists 
hostage. Terrorists do. 

While innocent civilians are the 
pawns, the real object of the game — if 
there is any beyond money and a per- 
verse sense of power — is to get govern- 
ments to change their policies. Much 
international terrorism originates in the 
Middle East, we know. I can tell you 
the policy they do not like. It's our sup- 
port for Israel. It's our support for a 
peace process, for negotiated and com- 
promise solutions to the region's prob- 
lems. It's our support for those Arabs 
who want peace and who want to nego- 
tiate. That is why vigorous efforts to 
defeat terrorism are an essential ele- 
ment in our strategy to advance diplo- 
matic solutions to the Arab-Israeli 
conflict. 

Elsewhere in the world, the pat- 
tern is similar. The closer an issue 
comes to peaceful resolution, the 
harder terrorists try to thwart these 
efforts. In Spain, the ETA [Basque Fa- 
therland and Freedom] claims that its 
terrorism is a response to repression by 
the central government. Yet, the vast 
majority of the more than 700 deaths 
resulting from Basque terrorism have 
occurred since 1979, when the Spanish 
Government granted significant auton- 
omy to the Basque region. 

In Peru, terrorists claim to act on 
behalf of poor peasants. Yet who are 
the victims? The overwhelming major- 
ity of the more than 10,000 innocent 
people murdered by these terrorists 
have been rural poor. 

Hostage-holding is another illustra- 
tion of the terrorists' total contempt for 
humanity. Terrorists employ this tactic 



precisely because they know that civi- 
hzed societies, and particularly the de- 
mocracies, place a high value on human 
life and the rule of law. The choices 
faced by democratic governments in 
hostage situations are, therefore, ago- 
nizingly difficult. 

There is one thing we and other 
countries have learned from bitter — 
very bitter — experience. If we pay ran- 
som, if we release prisoners, if we 
change our policies — or if we encourage 
other governments to do so — then we 
will simply encourage more terrorism. 
Our government has repeatedly made 
clear that we will talk to anyone, to any 
group, to any government about the 
well-being and release of the Americans 
still held hostage in Lebanon. Thus far, 
those holding the hostages have been 
unwilling to discuss with us the issue 
or its resolution, either directly or indi- 
rectly. In fact, their only communica- 
tions are impersonal and one way — 
through press releases and video re- 
cordings. We will continue to pursue 
actively whatever contacts we can. At 
the same time, our policy is firm — we 
will not make concessions to terrorists 
or compromise our fundamental 
principles. 

And what are the demands of these 
terrorists? They want us to force an- 
other country to release their brothers 
in crime. Just think about that. They 
kidnap innocent people to try to force 
us to free other terrorists who have 
been caught and convicted of murder. 
Well, we are not going to do it. I 
don't know how anyone can call that 
moral. I don't know of any religion that 
justifies it. 

I am confident that the American 
people understand and support the 
logic of our policy toward hostage- 
taking. While our deepest sympathies 
go out to the families of those held cap- 
tive — for they, too, are victims of the 
terrorist scourge — we also must protect 
the national interest. We have to pro- 
tect our citizens in the future even as 
we seek to help the victims of the pres- 
ent. As we move into this election year, 
I am equally confident that any effort 
by the hostage-holders to exploit our 
democratic electoral process will be 
met with ringing and cold rejection. 

Eventually, we hope that the 
hostage-takers will realize that there is 
no point in holding innocent Americans. 
I can only tell you that we have not 
given up hope. Circumstances change 
in the Middle East, sometimes very 
rapidly. 

To sum up our position, we believe 
that behavior rewarded is behavior re- 
peated. Terrorism must not pay. It is a 
very difficult rule to follow in practice. 
We know that. But follow it we must if 
we are ever to turn the tables on the 
terrorists. 



Obtaining 

Reliable Intelligence 



I 



The second element of our four-part 
counterterrorism effort is to obtain nfil; 
able intelligence. Who are the ter- 
rorists? Clearly, some are small groui 
of fanatics. Others are well-organizec 
groups operating across national bor- 
ders. Some support themselves throi- 
crime. In some cases, an unholy al 
liance has been formed between druji 
peddlers and terrorists. The peddler 
provide the money, and the terrorist 
provide the muscle. Other terrorists 
draw support directly from govern- 
ments. I think you would agree with 
me that the increase of state-sponsoi* 
terrorism is one of the more disturb]^ 
developments of late on the interna- 
tional scene. 

Solid intelligence on terrorism is 
not easy to develop. Technical means 
collection, through satellite or elec- 
tronic intercepts, are good, but to d* 
better we need people on the spot. I 
penetrating terrorist organizations i; 
difficult and dangerous job. Nev- 
ertheless, in spite of what the leadeil 
of these groups like to think, we ard 
finding ways to reach less-than-loyaJ 
subordinates. We know more about 
them than they think we do. 

I would like to salute the unsun 
heroes of the struggle against ter- 
rorism. These heroes are the intel- 
ligence analysts. Often they have lit 
to go on: a photograph, a fragment ' 
an overheard conversation, the text 
communique, the summary of a mee 
ing, a used airline ticket. Sometime: 
is like piecing together a gigantic ji| 
saw puzzle, but it's a puzzle that car 
save lives. 

We are always ready to hear fro 
other nations who have experience \ 
this problem. We are ready to pool ( 
efforts. I am encouraged by the will 
ness of our close allies and friends t( 
work together on these problems. A 
we are getting good results. Most K 
cently, for example, international co 
eration among a half-dozen countriei 
led to the arrest of the North Korea. 
agents who destroyed the civilian ai: 
liner last November. 

The resources devoted to impro i 
intelligence collection, analysis, and 
sharing are paying off. In the past 3 
years, we may have averted more th i 
200 terrorist attacks through intel- 
ligence efforts. No one writes about 
Not many know about it. But we ca 
take great satisfaction from the fact 
that people are alive and well today 
who never even suspected they were I 
danger. 



36 



Department of State Bulli 



THE SECRETARY 



Inproving Security Measures 

1 e third critical element of our policy 
i aiiist terrorism is to improve our se- 
c'ity measures. Let me give you two 
eamples: 

• Our efforts to improve security at 
IS. embassies; and 

• International efforts to improve 
flline safety. 

The people who represent the 
hited States abroad serve in the front 
les of America's interests. Our diplo- 
iits often work in areas which can 
tly be described as combat zones. I 
; 1 reminded of this every time I enter 
t ? State Department and see two 
jiques on the wall commemorating 
lumbers of the Foreign Service who 
( ;d in the line of duty. The older 
ique took 187 years to fill up. Most of 
? people listed there lost their lives 
■ accident or disease. The more recent 
ique, however, took only 20 years to 
. I up. And most of the people on it 
■re murdered by terrorists. So, don't 
anyone tell you that diplomacy is a 
1 party or pushing cookies. 

We have developed tough new 
indards about how our diplomatic in- 
allations are to be defended, and we 
.ve improved coordination with host- 
untry security officials. The State 
apartment has also taken the lead in 
aining over 6,000 civilian law enforce- 
ent officials from 45 countries in the 
chniques of counterterrorism. 

All of this has been done without 
langing the essentials of our represen- 
tion abroad. The terrorists cannot be 
lowed to run us out of town. 

This progress has not been cheap. 
ver the past 4 years, we have spent 
er a billion dollars to provide a better 
>fense for America's diplomatic facili- 
es overseas. Now look at the results. 
s protective devices have been in- 
alled and our diplomatic establish- 
lents have become harder to hit, 
;tacks and casualties have declined. 
et me give you some examples. 

• In Baghdad, a missile detonated 
ear a plate-glass window in the home 
f the deputy chief of mission. Had 
hatter-resistant film not been placed 

In that window, his daughter would 
ave suffered serious injury or death. 

• On June 25, 1983, the U.S. Em- 
bassy in San Salvador was strafed by 
nachineguns for several minutes. After 
(he attack, it was found that the wall 
i.round the embassy and the armor- 
;)lated windows had prevented several 
'mllets from penetrating offices. 

Other attacks have been thwarted. 
iVe regularly receive reports that ter- 
■orist groups have given up trying to 



attack an American establishment be- 
cause they found it too well defended. 
Experience tells us that the myth of 
the terrorist willing to die for a cause 
is largely that— a myth. Terrorists are 
not dumb, and they are not courageous. 
Most of them do not go on suicide mis- 
sions. That is not their purpose. 

In the field of airline safety as well, 
tremendous strides have been made in 
the past few years. A decade or two 
ago, it was not unusual to have 15 or 
even 18 hijackings a year. In 1970, the 
Popular Front for the Liberation of Pal- 
estine hijacked three airliners in one 
day. Since then, we and the interna- 
tional community have developed near- 
universal screening of airline pas- 
sengers for weapons and explosives. 

As a result, terrorist air piracy has 
declined to its lowest level since we be- 
gan keeping records over 20 years ago. 
In 1986, there were only two terrorist 
hijackings of aircraft, and only one in 
1987. 

Some have criticized the cost and 
effectiveness of defensive measures. I 
remember when we first started at 
this, I was Director of the Budget, and 
along came this program, and you know 
how a Director of the Budget reacts to 
something that's going to cost a lot of 
money. You try to poke holes in it. But, 
of course, I had to go along. And then I 
remember people were complaining: 
"Why do I have to stand in line in the 
airport, because I have to go through 
this thing?" Nowadays, I suspect, that 
any of you who go to an airport, and 
you don't have to go through a security 
measure, you don't like that. You want 
this to go on. I agree that it is costly. 
But I would rather see us spend the 
money than spend the lives. This is 
slow work, it's not exciting, but better 
security equipment and procedures do 
make a difference. 

Let me add here that our policy is 
not simply government people protect- 
ing themselves. Our ambassadors are 
sensitive to security threats to any 
Americans abroad, whatever their sta- 
tus, and we have established an Over- 
seas Security Advisory Council 
designed specifically to help U.S. busi- 
nessmen abroad. And our embassy se- 
curity officers are always available to 
talk about safety measures. 

liking the Offensive 

What I have told you about strategy, 
intelligence, and defense describes only 
part of the policy. The terrorists are 
waging war against us. And we have 
every right under international law to 
defend ourselves. Part of that defense 
is to take the offense. 



The first goal of our action pro- 
gram is to pressure states which spon- 
sor terrorism. An ugly fact of 
international life today is that some 
states provide terrorists with important 
resources — weapons, financing, pass- 
ports, safe houses, training areas. In 
return, the terrorists commit violence 
that serves a government's interests but 
which can be denied by that govern- 
ment. We must expose the link between 
terrorists and their state sponsors and 
then break it. 

The first state to feel the pressure 
of an American offensive against ter- 
rorism was Libya. You all know the 
story. For 5 years we tried to reason 
with Qadhafi. We used political, eco- 
nomic, and diplomatic pressures. But 
they were not enough. When the Presi- 
dent had convincing evidence of Libyan 
involvement in the attack on the La 
Belle disco in Berlin — and a dozen 
other planned attacks on American dip- 
lomatic establishments abroad — he did 
what he had to do. 

The American bombing raid on 
Libya opened a new chapter in the in- 
ternational fight against terrorism. It 
brought home to Qadhafi and other ter- 
rorists that the United States was not 
going to take it anymore. We would use 
mihtary action against terrorism if nec- 
essary. The European allies, initially a 
little reluctant, very quickly followed 
with political, diplomatic, and economic 
measures against Libya. In this regard, 
the work of the Trevi Group of Euro- 
pean ministers has been invaluable. I 
look forward to the day — unfortunately 
not here yet — when Libya is out of that 
business altogether. 

Libya is not the only state support- 
ing terrorism. In late 1986, courts in 
London and Beriin found Syrian com- 
plicity in terrorist attacks in those cit- 
ies. The United States joined with 
Great Britain in an international cam- 
paign to convince Syria to reduce its 
connections with terrorist groups. 
These measures also produced results. 
In June of last year, Syria finally ex- 
pelled the notorious Abu Nidal group 
from Syrian territory. Even so, because 
of its relationship to other terrorist or- 
ganizations, Syria remains on our list of 
terror-supporting states. 

Iran, too, is a key supporter of ter- 
rorism. Terrorism has been a hallmark 
of its policy ever since Ayatollah Kho- 
meini came to power 9 years ago. Iran 
has been responsible for attacks on 
U.S. targets, on French and British in- 
terests, and on moderate Arabs. Our 
government has imposed a series of 
tight sanctions on Iran and encourages 
other governments to do the same. 

Following North Korea's clear 
culpability in the bombing of South 
Korean airliner number 858, last month 



\pril 1988 



37 



THE SECRETARY 



the United States officially designated 
North Korea a terrorist-supporting 
state. Realistically, the United States 
has little leverage it can use directly 
against North Korea. But other govern- 
ments have more leverage. We have in- 
dicated that we want their help in 
persuading North Korea that such tac- 
tics will not succeed. 

I am never reluctant to raise the 
issue of terrorism with governments 
who may be involved and who want bet- 
ter relations with us. Recently, we 
were able to wage a diplomatic cam- 
paign that seriously disrupted the com- 
mercial network supporting the Abu 
Nidal terrorists in Eastern Europe. 

A second goal of our program to 
take the offensive is to streamline inter- 
national legal procedures and promote 
closer cooperation among law enforce- 
ment agencies. We are making headway 
here. The State Department has 
worked successfully to change e.xtradi- 
tion treaties with Britain, the Federal 
Republic of Germany, Belgium, Canada, 
and Spain. Terrorists should not be 
able to escape justice by avaiUng them- 
selves of legal protection intended for 
refugees seeking political asylum. 

At long last, thanks to good police 
work and including international coop- 
eration, we are bringing the terrorists 
to justice. 

• In Britain, Nezar Hindawi is 
serving a life sentence for his attempt 
to destroy an El Al airliner. 

• In France, Georges Ibrahim Ab- 
dallah is serving a life sentence for his 
part in the assassinations of an Ameri- 
can military attache and an Israeli dip- 
lomat and the attempted assassination 
of the American charge d'affaires. 

• In Italy, the Ackille Lauro 
hijackers have been tried and 
convicted. 

• In the United States, Fawaz 
Younis faces trial on charges that he 
held American citizens hostage as he 
led the hijacking of a Royal Jordanian 
Airlines flight in Beirut. 

• In the Federal Republic of Ger- 
many, one Hamadi brother is on trial 
for kidnapping a German businessman 
and the other is expected to go on trial 
shortly for the hijacking of TWA 847. 

This is just a sampling. Over the 
past 2 years, another 40 significant ter- 
rorists were arrested or convicted. 
Many of these cases are important for 
another reason. The prosecutions have 
been undertaken by countries whose in- 
terests were not the primary targets of 
the terrorists. In every case, the pros- 
ecuting government has faced real or 
potential reprisal attacks from support- 
ers of the terrorists. Yet, despite these 
threats, governments have gone for- 
ward with the rule of law. 



It saddens me to report that the 
war against terrorism is still producing 
casualties. Just a few weeks ago, the 
Colombian Attorney General was 
struck down. He was murdered for do- 
ing his job, for trying to lift the curse 
of the drug cartels from his country 
and, for that matter, from our own. In 
their search for allies to overthrow Co- 
lombia's democracy, the political ter- 
rorists and the drug terrorists have 
made common cause. Every free in- 
stitution has been attacked. Two news- 
paper editors, 21 judges, and a minister 
of justice are among the dead in this 
struggle. 

We are going to redouble our 
efforts to help our fellow democracy, 
Colombia, in this hour of crisis and 
pain. And we are going to win. 

A Successful Strategy 
Against Terrorism 

Some 4 years ago, I delivered another 
speech on terrorism. At that time, I 
expressed my fear that moral confusion 
and our instinct for finding fault with 
ourselves would paralyze us in the face 
of this insidious threat. Since then, 
much has happened. But I believe that 
we have all emerged from our experi- 
ences with a firm set of convictions 



about terrorism. We are clearer todajj 
both about the danger and about our- 1 
selves. Above all, the American peopl 
understand more clearly the risks, es 
pecially the risks of dealing with host 
age situations. f 

The policy I have described is th«[-, 
result of those experiences, the good [,' 
ones and the bad ones. It builds uponr 
the enduring foundations of a success j' 
strategy against terrorism: a strategj 
that applies cool reason to the problei 
a strategy that finds the hard facts; a 
strategy that combines defense and o; 
fense to raise the costs and reduce th 
rewards to terrorists; finally, a strate 
that does not flinch from pressuring 
governments that support terrorists. 

What we know about terrorists a 
terrorism indicates that there are no 
instant remedies or easy ways out. )\ 
face a long and hard struggle against 
this modern barbarism. It will take o 
skill and our strength, our will and oi 
wisdom, our patience and our per- 
severance to prevail. But prevail we 
must. I am convinced that if the Amf 
can people and our allies support our 
policy, we will succeed. Terrorism wi) 
ebb. And humanity will be served. 



iPress release 18 of Feb. 16, 1988. ■ 



Managing the U.S.-Soviet Relationshij 



Secretary ShuUz's address before 
the Henry M. Jackson School of Inter- 
national Studies in Seattle on February 
5, 1988A 

Our relationship with the Soviet Union 
has preoccupied American foreign pol- 
icy for nearly half a century. Few public 
figures in the postwar world have done 
so much as Scoop Jackson to shape 
American thinking about that rela- 
tionship. So I was pleased and honored 
to be invited here by the Henry M. 
Jackson School of International Studies. 
Scoop Jackson believed passionately 
in democracy and saw clearly the threat 
that totalitarianism posed to it. He ar- 
gued that the Soviet challenge came in 
many forms and that there was a close 
relationship among all the Soviet pol- 
icies and actions that gave us concern, 
from the Soviet Union's accumulation of 
military power, to its projection of that 
power outside its borders, to its denial 
of the individual's fundamental rights 
and freedoms. He fought with great en- 
ergy and skill to marshal the will and 
resources of the Western democracies 



to protect their freedom and advance 
their vision of a peaceful and just 
world. 

Scoop Jackson believed that the 
West must be realistic about the Sovi 
Union. He had faith in the West's abi 
ity to muster the strength to deal wil 
that reality. He saw that if we main- 
tained both our strength and our real 
ism and dealt forthrightly with East- 
West differences, we might ultimately 
shape the conditions for a new Soviet- 
American relationship that would se- 
cure both peace and freedom. 

This vision of the problem and tb 
solution has stood up well. America h 
restored its strength and stayed real- 
istic. This, in turn, has had a remark- 
able impact on the pace, scope, and 
productivity of U.S.-Soviet relations. 

Features of Global Change 

The change in the tempo of U.S. -Sovi 
relations is also occurring as part of a 
larger transformation of our world. Tl 



38 



Department of State Bullet 



THE SECRETARY 



s sdmetinies are subtle, some- 
Iramatic. The U.S. -Soviet rela- 
p both influences and is deeply 

' 1 by these changes. 

1 e emerging features of global 
.ij are evident all around us: 

• The rapidity both of technological 

V ion and the means to distribute 
chnology on a global scale; scien- 

, conomic, and political matters 

T:K global in dimension; 

increasing economic interdepen- 

c combined with the appearance of 
nters of economic wealth, partic- 
rl in Asia; 

1 The dispersion of political power, 
K jh key elements of the bipolar, 
■f ir world endure; and 

' The common thread in all these 
m !s: the imperative of knowledge — 
d :overy, its transmission as infor- 
tii 1, and the education needed to 
' . The speed of human transactions 
ic lerating. Openness and communi- 
iC are key to the creation and mas- 
yi '. change. 

le net result is a strong and en- 
a ^ng trend toward democracy, 
!i 3SS, and freedom, both within 
i nong nations. The countries that 

I vancing economically, socially, 
i )litically these days are those 

ii have adopted greater freedom in 
i arketplace and in their political 
t itions. In a world where informa- 
n nd innovation are the engines of 
c 'nity, societies that suppress inno- 
i and imprison information are 
] ; farther and farther behind. 

he changes now taking place in 
' immunist world are, in this sense, 

II jndly reactive, a halting and anx- 
i ttempt to catch up to the dyna- 

S and creativity of the West. We 
t much of "new thinking" these 
We should be clear what it repre- 
It is an effort to come to grips 
the reality of a world being shaped 
:y the Soviet Union and its allies 
3 y the community of free nations 
1 he force of freedom. 
)ne consequence of this change is a 
I hope for an eventual end to the 
experiment with totalitarianism 
for most of the 20th century, has 
ed mankind's hopes for a human 
lunity based on peace and free- 
But that experiment is still with 
id must be dealt with. This means 
the American-Soviet relationship 
remain a central U.S. concern for 
des to come. 

rhe question we confront is 
her we can fashion a U.S. -Soviet 
ionship that permits both of us to 
te our energies less to confronting 



one another and more to mastering the 
challenges of global change, both in our 
countries and as important powers in a 
complex international environment. 

The world which emerged after 
World War II was a bipolar world. The 
gravitational pull exerted by the con- 
centration of economic and military 
power in two such different systems as 
those of the United States and Soviet 
Union was enormous. The principal lim- 
itation on the actions of the two former 
allies was the power of the other. 

Restraining the abuse of Soviet 
military power was the focal point of 
U.S. foreign policy after 1945. Contain- 
ment sought to deal with the problem 
directly and led to the establishment of 
NATO and a global system of alliance 
relationships. U.S. efforts to revive the 
world economic system helped deny 
Moscow options for expansion. 

But the bipolar world which 
emerged in the postwar era has been 
steadily eroded by accelerating changes 
on a global scale — changes which have 
widely dispersed political, economic, 
and military power. The rigidly cen- 
tralized Soviet system, with its insis- 
tence on maintaining a monopoly on 
information, was incompatible with 
many of the most important trends. 

Nevertheless, until quite recently, 
the Soviet Union largely blinded itself 
to the significance of these trends. So- 
viet achievement of strategic parity and 
improvements in living standards over 
the immediate postwar era, coupled 
with perceptions of U.S. weakness 
after our withdrawal from Vietnam, 
temporarily masked the Soviet Union's 
growing systemic problems and irrele- 
vance as a model for the developing 
world. 

Thus, Soviet leaders talked of a 
shift in the "correlation of forces" and 
moved aggressively at home and 
abroad. 

• The Soviets continued to place an 
excessive emphasis on military 
strength, with a military buildup which 
showed no signs of abating even after 
the achievement of strategic parity and 
which appeared designed for Soviet ex- 
pansion at the expense of the security 
of other nations. 

• Moscow continued to rely on 
force — or the provision of the means of 
force — to extend its influence abroad. 
This tendency reached its height, but 
by no means its end, with the 1979 in- 
vasion of Afghanistan. 

• Repression of dissidence at home 
reached a post-Stalin peak in the final 
years of the Brezhnev leadership, in 



contravention of solemn Soviet interna- 
tional undertakings, and despite the 
growing trend toward democracy and 
openness throughout the world. 

By the late 1970s, however, Soviet 
practices began to confront changing 
realities. Even the Soviets now de- 
scribe this period as one of stagnation 
and misdirection. 

The United States, for its part, 
initially attempted to preserve a one- 
dimensional detente which had not 
served as a brake on Soviet uni- 
lateralism. But after this period of hes- 
itation, America responded. 

In electing Ronald Reagan, Ameri- 
cans in 1980 served notice that they 
were prepared to do what was neces- 
sary to contain Soviet expansionism, al- 
beit in a world greatly different from 
that which emerged from the ashes of 
the Second World War. 

President Reagan's 
Three-Tracked Strategy 

From his earliest days, President Rea- 
gan has pursued a three-tracked strat- 
egy. Of critical importance was the 
restoration of American strength — mod- 
ernizing our armed forces, rebuilding 
the confidence and unity of our al- 
liances, strengthening our economy, en- 
couraging the growth of democracy and 
freedom throughout the world. Western 
firmness and vigilance were necessary 
then, are so now, and must continue. 
We sought to bring America's re- 
stored strength to bear in accordance 
with a realistic appraisal of the nature 
of Soviet society and its policies. 
Rather than focus only on the weapons 
buildup that is a symptom of the East- 
West conflict, the Administration 
sought to confront the full range of is- 
sues which affected the relationship. 
Thus: 

• Rather than satisfying ourselves 
with half-steps on arms control, we set 
out to achieve agreements which would 
actually reduce arsenals, enhance se- 
curity, and be effectively verifiable; 

• Rather than rail ineffectually 
against intervention by Soviet forces 
and Soviet clients in the developing 
world, we worked with those prepared 
to defend their freedom to demonstrate 
that the price of adventurism was high 
and lasting; 

• Rather than treat human rights 
as an embarassing afterthought, we 
recognized that these issues are a per- 
manent and positive component of in- 
ternational relations that is central both 
to our vision of the world and to our 



1988 



39 



THE SECRETARY 



security. We have made them an inte- 
gral part of the dialogue, one that takes 
genuine pride of place in discussions at 
all levels; and 

• Rather than treating bilateral re- 
lations as inducements or rewards for 
Soviet moves in other areas, we have 
established high standards of reciproc- 
ity of benefit in exchanges. 

Our emphasis on strength and real- 
ism did not preclude dialogue with 
Moscow. Indeed, we sought to make 
that dialogue productive in bringing the 
Soviet Union to understand the impor- 
tance of changes in its approach to is- 
sues in which the United States — and 
the world — had a legitimate interest. 
We have insisted that the dialogue 
cover the full range of interests, from 
arms control and regional issues to hu- 
man rights and bilateral affairs, and we 
have sharply defined American objec- 
tives in each of these areas. 

We have stressed that all of the 
broad areas of this agenda are closely 
related, in the conviction that a stable 
and constructive U.S. -Soviet rela- 
tionship can be achieved and sustained 
only if Moscow is willing to take con- 
crete steps to resolve critical problems. 
The Soviets seem, increasingly, to un- 
derstand that reality. 

While the interrelationships among 
the areas are strong and inescapable, 
we have also maintained flexibility in 
how we pursue our interests in each. 
We do not accept the assumption 
that linkages can be applied indis- 
criminately, however tempting it might 
be to try linkage when there is prog- 
ress in some areas but not in others. 

Clearly, we recognize that excep- 
tional circumstances may arise where 
progress in one area must be made con- 
tingent on another, especially in the 
face of Soviet actions which undermine 
the foundation of a stable peace. Yet it 
is impossible to see how we might ex- 
pect to get anywhere with a policy 
which dictates that nothing can be 
solved until everything is solved. The 
U.S. -Soviet relationship is too difficult 
and complex to make that a practical 
option. 

The flaws of indiscriminate linkage 
as an instrument of policy have been 
demonstrated over the years. As a pol- 
icy, it deprives us of the opportunity to 
pursue realistic agreements that serve 
Western interests. It yields the initia- 
tive to the Soviets to set the pace and 
scope of relations with us and with our 
allies. It disrupts the consistency and 



discipline that are essential for suc- 
cessful Western pursuit of a long-term 
strategy for a more peaceful and demo- 
cratic world. 

And most important, linkage as 
practiced in the past has not worked. 
If, for example, the Soviet Union leaves 
Afghanistan, it will not do so because 
the United States imposed a grain em- 
bargo or withholds arms reduction 
agreements that make sense for West- 
ern security. Rather, the Soviets will 
return the fate of Afghanistan back to 
the Afghan people because the Afghans 
have struggled with courage and deter- 
mination and because the world commu- 
nity, led by the United States, 
ultimately has responded where it mat- 
ters — directly on the ground, with ma- 
terial and political support. 

Despite such outrages as the So- 
viet downing of a Korean airliner in 
1983 or Soviet espionage against our 
embassy in Moscow, President Reagan 
persevered in our agenda, keeping our 
arms control negotiators in Geneva and 
our high-level dialogue with Moscow on 
track. One result is the INF Treaty, 
which fulfills our negotiating objectives 
and will make an impressive contribu- 
tion to U.S. and allied security. 

Rather than break contact, we have 
tailored our responses to the issue at 
hand. For instance, after the downing 
of KAL [Korean Air Lines] 007, we 
suspended Soviet Aeroflot service to 
the United States, even as our arms 
control negotiators returned to Geneva. 
We sought new procedures to ensure 
that a similar tragedy would not recur. 
We achieved solid results: an improved 
civil aviation agreement that guaran- 
tees equal benefits for the American 
carrier and an agreement on civil air 
safety in the North Pacific that benefits 
everyone flying to Japan and Korea. 

Thus, our approach is to recognize 
the interrelationship of our interests in 
arms reductions, human rights, re- 
gional affairs, and bilateral relations 
and to work toward a global environ- 
ment in which real, measurable prog- 
ress is attainable in all. When we have 
reached agreements that further our in- 
terests, we have signed them, while 
pressing forward with unfinished busi- 
ness. This, in turn, has imparted a con- 
sistency and reliability to American 
foreign policy that have contributed to 
the confidence of our friends and allies, 
created strong incentives for the Soviet 
Union to negotiate realistically, and 
have produced concrete agreements 
that enhance Western security. 



Building a More Constructive 
Relationship 

By the end of the President's first 
term, the United States and the V 
had begun to shape new condition 
Even before Mikhail Gorbachev be 
General Secretary, the Soviet Unii 
had begun to respond. Having fail 
threat and boycott to force the We 
negotiate arms control on Soviet t 
the Soviets returned to the bargai 
table at the nuclear and space talk 
1985. Within the Soviet Union itse 
the realities of a resurgent, self- 
confident United States, of a turn 
democracy and free enterprise thr 
out the developing world, of the ir 
ability of Soviet client regimes to 
consolidate their hold on power, ai 
a rising chorus of international coi 
nation of Soviet human rights pra( 
had created a crisis of confidence. 

Increasingly, Soviet citizens— 
ultimately, their leaders — came to 
ize that the Soviet system was no 
longer working and that the Sovie 
Union risked falling further behin 
The process of coming to terms wi 
present-day realities accelerated c 
General Secretary Gorbachev cam 
power. || 

And in terms of concrete resu ^ 
across the broad agenda the Reag ,^ 
Administration had been pursuing |j 
the record has grown increasingly ,( 
impressive. 

• The Soviet Union has accepi H 
our realistic and comprehensive fr U 
work for dealing in practical ways il 
the issues that divide East and W .. 
By encompassing the full range of • 
sues in U.S. -Soviet relations, this ' 
framework has given structure am li 
rection — an agenda — to our dialog . 
Clearly, dialogue by itself is not 
enough. What counts is a change i 
Soviet conduct. But establishing t 
framework was an important steji - 
ward the progress that has followt 

• We have concluded the INF 
Treaty, which is remarkable both I • 
goal of eliminating an entire class ' 
U.S. and Soviet missiles and for it^ 
precedented verification measures 

• We have made important .^ti t 
toward conclusion of a treaty that 
would cut in half the U.S. and Sdv t 
strategic nuclear arsenals. 

• We have improved governme 
to-government communications by F 
grading the Hot Line and through 
agreement to establish Nuclear Ri 
Reduction Centers in Washington < 
Moscow. 



40 



Department of State Ba 

■I 



THE SECRETARY 



• A'e have seen some modest prog- 
jri human rights and humanitarian 
and we have established regular 
uis of views on regional con- 
-ulijects which the Soviets 
ismissed as off hmits or of sec- 
1 importance to arms control. 
«iVe have breathed new life into a 
cm of bilateral cooperative pro- 
- ranging from people-to-people 
ts among young people, to im- 
air service between the United 
and U.S.S.R., to scientific, cul- 
aiul educational exchanges. These 
ms help lower the artificial bar- 
he Soviets have long maintained 
n enrich both countries. 

lis is a hopeful beginning to a 
' nd purposeful effort to establish a 
lUern of more constructive 

lis. 

is much in vogue now — perhaps I 
>ay in "Time" — to attribute to 

cliev the credit for this progress. 

\, the Soviet Union contributed, 
1 e welcome that. As President 
sa n once said, "it takes two to 
If " Both sides benefit from this 

;s. as they must if it is to endure. 

e watching with great interest the 
. e.xperiment with "openness" and 
K ucturing" and hope these evolving 
111 pts result in changes which ad- 
ei American concerns. We already 
e )me evidence that they might. 

et the truth is that the agree- 
a ; that have been reached recently 
id tie prospects for future progress 
e lunded in American "new think- 
? ind innovation, both in our broad 
r. ;gy and in our solutions to specific 
Dems. 

Ul of the agreements I just men- 
B d stem from American initiatives 
Kdeas. And there are more, such as 
M cuts in strategic nuclear arms, the 
K )ects for negotiated solutions to re- 
Oil conflicts, and changes in Soviet 
iin rights practices, that have 
•nd Western interests well. 

Moreover, the process now under- 
ain U.S. -Soviet relations has 
Mrred because it enjoys the broad 
f ort of the American people. For 
i; irst time in years, American policy 
> rd the Soviet Union enjoys a 
.:ig domestic consensus. If this 
) ensus can be maintained — and it 
■ lid be — American policy toward the 
' et Union will be bolstered by an 

ist unprecedented continuity and 

ility and will continue to be dy- 
i,ic and creative in pursuing real 
1 tions to problems. 



A better relationship between the 
United States and the U.S.S.R. may, 
indeed, be possible. Such a relationship 
would be marked by the candor to rec- 
ognize our differences, the initiative to 
solve them where we can, and the abil- 
ity to manage our differences peacefully 
where competition endures, as surely it 
will. During one of his visits to Wash- 
ington last fall. Foreign Minister Shev- 
ardnadze may have been thinking along 
these same lines. He made a point 
which left a strong impression on me. 

He noted that over the past several 
years, the United States and the Soviet 
Union had taken a remarkable number 
of steps in various areas. We had 
reached a point, he concluded, where 
our quantitative progress had created 
the possibility of a qualitative change in 
the nature of the relationship. We 
seemed to be moving, he said, toward a 
more normal relationship. 

I have since thought a lot about the 
Foreign Minister's words, and I have 
decided that I both disagree and agree. 

I find it difficult to believe that our 
relations with the Soviet Union will 
ever be "normal" in the sense that we 
have normal relations with most other 
countries. There are only two super- 
powers in the world. We are vastly dif- 
ferent in the ways we view the role of 
the individual in our societies and in 
the ways we relate to other countries. 
The relationship between us will always 
be unique. It seems unlikely that the 
U.S. -Soviet relationship will ever lose 
what always has been and is today a 
strongly wary and at times adversarial 
element. 

Nor do I think that the accumula- 
tion of individual agreements or cooper- 
ative arrangements will, by itself, 
result in a quantum leap to a qualita- 
tively different kind of relationship. The 
differences between us and the suspi- 
cions they generate are too deep. Expe- 
rience has proved that agreements 
alone cannot bridge such a divide. 

But I believe there is a sense in 
which the Foreign Minister was right. 
The case can be made that we are near 
a threshold of a sustainable U.S. -Soviet 
relationship. On the U.S. side, there is, 
for the first time in many years, a 
strong consensus on how we should 
deal with the Soviet Union. On the So- 
viet side, there may be — for the first 
time ever and as a result of necessity — 
a willingness to reexamine Soviet se- 
curity and other interests in ways that 
are closer to international norms. 
One often hears the question: 
"Does the United States want reform in 
the Soviet Union to succeed or fail?" I 
believe that posing the question in that 



way misses the point. We have worked 
long to put in place a policy that is both 
flexible and resilient enough to adapt to 
changing circumstances and to expand 
cooperation whenever the Soviets are 
ready to reach realistic agreements. In 
short, we are well positioned to deal 
with the best and worst of Soviet 
behavior. 

As interesting as the changes now 
taking place in the Soviet Union may 
be, our concern must be with the way 
these changes affect, in concrete terms, 
the interests embodied in our broad 
agenda. We must deal with the Soviet 
Union as it is, not as we wish it to be. 
The Soviet system is just beginning an 
attempt at economic reform. It has 
barely scratched the surface of struc- 
tural political reform. We have not seen 
changes that suggest the Soviet Union 
has altered its historical objective of al- 
tering the international system to its 
advantage. 

Thus, we should welcome change in 
the Soviet Union — and wish the Soviet 
people well — precisely to the extent 
that the Soviet effort at modernization 
squares with American hopes for a 
safer world and a more productive 
U.S. -Soviet relationship. We are con- 
vinced, moreover, that progress in the 
areas of greatest interest to the United 
States and the world would also serve 
best the people of the Soviet Union. 

Future Goals in U.S.-Soviet Relations 

What, reahstically, can we expect in 
U.S.-Soviet relations during a period of 
change within the Soviet Union and on 
a global basis? Our ultimate goal has 
not changed — a Soviet Union which 
deals with other countries and with its 
own people through dialogue rather 
than intimidation. This would be a 
sweeping change, one which would re- 
verse much of this century's interna- 
tional politics. That destination is 
distant, and getting there will confront 
us with many ambiguities about the 
scope, durability, and meaning of 
change in the Soviet Union and in the 
international environment. 

Thus, it would be mistaken and un- 
realistic to expect to replace, in the 
foreseeable future, the international se- 
curity system. Our security, freedom, 
and prosperity will continue to rest on 
nuclear deterrence, on our system of 
alliances, on our efforts to expand and 
strengthen democracy and a free inter- 
national economy, and, above all, on our 
own strength and will to defend our 
interests and values. 



|l 1988 



41 



THE SECRETARY 



We can, however, work at building 
a relationship with the Soviet Union 
that, while remaining competitive, also 
is less dangerous. Measured progress 
across our four-part agenda vnth the 
Soviet Union provides a blueprint to 
this end, a framework for steps that 
will strengthen international stability 
and foster the conditions for future 
progress. 

These near-term goals are attain- 
able over the coming months and years 
if we, as a nation, pursue them pa- 
tiently, steadily, and seriously and if 
the Soviet Union works with equal ded- 
ication to modernizing its relationship 
with the rest of the world. Achieving 
these goals would go far toward cor- 
recting the Soviet excesses of the last 
decade or so. 

On the military side, our objective 
over the next few years is to deal with 
the consequences of the massive Soviet 
military buildup since the mid-1970s. 
This will require a continued, strong 
effort by the United States and our al- 
Ues to modernize and strengthen con- 
ventional and nuclear deterrence. A 
robust defense budget — as well as 
strong security and economic as- 
sistance — are crucial if we are to con- 
tinue to foreclose Moscow's other 
options. At the same time, we see 
greater opportunities than ever before 
to achieve balanced, effective, verifiable 
arms control agreements that would re- 
dress existing imbalances and impart 
greater stability and predictability to 
the military aspects of the U.S. -Soviet 
relationship. 

• The INF Treaty would eliminate 
entirely an important element of the 
Soviet military buildup of the 1970s — 
the deployment of the SS-20 missile as 
well as the older SS-4 missiles and the 
threat posed by the Soviets' shorter 
range INF missiles. Ratification and 
full implementation of the treaty will 
contribute substantially to Western 
security. 

• The next step is a verifiable 
treaty which cuts U.S. and Soviet stra- 
tegic offensive arms in half and estab- 
Hshes a stable strategic nuclear 
balance. We will work hard to complete 
a treaty by the time President Reagan 
goes to Moscow this year. The Soviet 
Union has pledged a similar effort. 
Many of the critical elements for such a 
treaty are already in sight, but much 
remains to be done, particularly in the 
area of verification. Completing a 
treaty in the next few months will de- 
pend greatly on Soviet willingness to 
work cooperatively and creatively with 
us to solve these complex problems. 



• We also will continue a vigorous 
SDI [Strategic Defense Initiative] pro- 
gram to see whether strategic stability 
might rest increasingly on defense- 
based deterrence rather than ex- 
clusively on the threat of nuclear re- 
taliation. This program is essential, 
both because of Soviet strategic defense 
programs and because it may establish 
a basis in the future for a safer way to 
secure international peace. 

• We and our allies will persevere 
in efforts to achieve greater stability 
and openness regarding conventional 
military forces in Europe; to achieve a 
truly global and verifiable ban on chem- 
ical weapons; to prevent the prolifera- 
tion of nuclear weapons; and to seek 
realistic, step-by-step progress on nu- 
clear testing, beginning with needed 
verification improvements to the exist- 
ing limitations in the Threshold Test 
Ban and Peaceful Nuclear Explosions 
Treaties. 

We will continue to insist on con- 
crete Soviet steps toward the freer flow 
of information, people, and ideas set 
out in the 1975 Helsinki Final Act and 
the follow-on documents of the Helsinki 
process. Without detracting from the 
positive steps that have been taken in 
recent months, we will not shrink from 
insisting that those families who remain 
divided be allowed to join their loved 
ones, that those who wish to emigrate 
be let go, that religious believers be 
allowed to practice their religion, and 
that their rights be guaranteed by ap- 
propriate institutional safeguards. 

To Americans, the human rights is- 
sue will only be resolved when old 
abuses are cured and new ones cease to 
emerge. Given the nature of the Soviet 
system, that situation may be years off, 
but there can and must be steady prog- 
ress toward it. F\irther, as the Presi- 
dent stated in his Berlin initiative last 
June, one place we will look for a real 
change of policy is in Eastern Europe. 

On regional affairs, we cannot as- 
sume that the Soviet Union has aban- 
doned its traditional inclination to 
extend its political writ and cast its 
military shadow over other regions of 
the world. Thus, the United States 
must be prepared to support those who 
are willing to fight for their freedom 
and self-determination. If, however, the 
Soviet Union is willing to rethink past 
positions, we will lend our hand to 
efforts to bring peace and national rec- 
onciliation to regions now torn by 
conflict. 



• On the pivotal question of ' 
Afghanistan, the Soviets have prol| 
to recognize the importance of a ' 
prompt withdrawal of Soviet forces! 
of the need to allow the Afghan pt' 
determine their own fate. We look 
the Soviet leaders to act on this ii 
nition and to put forward promptb 
plan for the rapid, complete, and ij 
versible removal of Soviet forces b ' 
end of this year. 

• Similarly, we will press the 
viet Union to contribute concrete! 
efforts to bring negotiated politics 
lutions to other regions of the wor 
where Soviet clients are fighting t 
own people and their neighbors. 

On the bilateral side of the re 
tionship, we have already put in pi j 
framework of agreements which si j 
concrete U.S. interests — on civil 
tion, on space cooperation, and on 
change activities in the cultural ai 
scientific fields. At the Washingto 
summit, the President and the Ge 
Secretary identified additional are 
where the two sides have much to 
tribute to each other. Some of the 
involve potentially valuable activit 
deal with changes in our world — fi 
stance, bilateral and multilateral ( 
to study the consequences of chan 
the global climate and environmer 
explore the prospects for nuclear 
as an unlimited source of energy, . 
harness the potential of such areas 
increasing importance as the Arct 

Realizing Our Objectives 

What can we do to maximize our 
chances of realizing these objectiv 
Our principal job is to continue sh 
conditions that will affect Soviet b |9 
ior. Western strength and vigilanc |U| 
key to this. If we do our job at sh: |d 
those conditions, the overall framt oi 
which we already put in place can .n 
tinue to be an important means tn iii 
goals. It is more important than e i 
that both sides share a certain coi ifl 
approach if we are to create the k I 
qualitatively different relationship e 
seek. 

During General Secretary Goi 
bachev's visit to Washington, I shafd 
with him, in the form of a luncheo i 
toast, a set of guidelines which mijtt 
apply to both sides as we build on in 
accomplishments thus far. They ar 
worth repeating. 

• First, the U.S. -Soviet rela- 
tionship is as important as it is uniu 
It is important because we each b(r 



42 



Department of State Bib 



THE SECRETARY 



imense burden of leadership in the 
n. It is unique because the nuclear 

■ >mands that we engage each 

despite our profound differences. 

■lu ral Secretary Gorbachev said 

linok, "There is no getting away 
i.'iu'h other." 

Second, our relationship will con- 
into be a difficult one to manage. 
.^ live contrasting philosophies, polit- 
Jystems, and national interests. 
If asic values and systems and inter- 
ig^'ill persist, even as the necessity 
wrk together increases. 

Third, we must be realistic, 
! lie extremes of either hostility or 

■ ria, through the ups and downs of 
r ilations. The best approach to 

alig with one another is to be down- 
i^-th, pragmatic, and businesslike in 
ig to solve concrete problems. 
Fourth, we must speak with clar- 
il candor to one another about our 
■lues. This is why we have always 
eil to the Soviets the fundamental 
tance we attach to human rights, 
t'urth in the Universal Declara- 
: 11(1 the Helsinki Final Act. As the 
uan Community heads of gov- 
■iit stated December 5: "respect 
iiiian rights and freedom is a pre- 
j -iite for confidence, understanding, 
r o(i|)eration." We have spoken with 
n ir about regional issues, as well. 
i< ioviets have not hesitated to speak 
e mind to us. And we have made 
II progress. As President Reagan 
IS aid, we owe each other the tribute 
< idor, and candor will help us get 
sts. 

■ Fifth, we must look to the future 
it mt neglecting the lessons of the 
■ Too often, we face the past and 
I into the future. In 5-10 years, our 
(I i will be vastly different from the 
ve know today and from the post- 
world of the past 40 years, which 
;onditioned so much of our 
jdng. 

» This leads to a sixth point: the 
jljnition that openness to ideas, in- 
I ation, and contacts is the key to 
M'e success. The conceptual break- 
Saghs embodied in the INF Treaty's 
f; isions for verification and onsite in- 
1 tion are but one example of the 

rful pull which openness is already 
• ting in a key area of U.S. -Soviet 
; -ions. 

I concluded my toast by urging 
the United States and the Soviet 
on seek steady progress toward a 
e o])en, more predictable, more sta- 
and constructive relationship. In 



this time of change, I argued, new pat- 
terns of interaction also offer new op- 
portunities for cooperation and 
progress, and we should grasp those 
opportunities. 

The General Secretary did not say 
whether or not he agreed with me. But 
I am convinced, and experience has 
shown, that an approach which is less 
realistic, an approach which is less flex- 
ible, an approach which is less forward- 
looking, will be inadequate to the task. 

I am also convinced that, for our 
part, Americans can approach the chal- 
lenges and opportunities posed by the 
current moment in U.S. -Soviet rela- 
tions with the same leadership, confi- 
dence, and innovation that have 
characterized our national approach to 
change in other areas, from politics to 
technology. 

Americans are not afraid of change 
or new thinking — in the Soviet Union 
or anywhere else. Two hundred years 
ago, we enshrined the concept of new 
thinking in our national life, and we 
have lived by it since. We have thrived 
precisely because we have challenged 
and questioned and have not shied away 
from change but have thirsted for it. 



We have, as Scoop Jackson advocated, 
been forthright about both the chal- 
lenges we confront and about the 
changing environment in which they 
play out. We have been strong in deal- 
ing with the challenges — and always, 
we have tried to make things better, to 
advance the American vision of a more 
democratic, more peaceful, and more 
prosperous world. 

Today, we recognize that a poten- 
tially important experiment is getting 
underway in the Soviet Union. It sug- 
gests the possibility of a far more satis- 
factory U.S. -Soviet relationship than 
we have known in the postwar era, a 
relationship which could be a construc- 
tive element in a changing world. 

Americans are willing to work with 
dedication and creativity to fashion 
such a relationship. It is a goal which is 
achievable if the Soviet leadership is 
willing to join us in making change for 
the better a permanent reality. 



'Press release 14 of Feb. 8, 1988. 
Question-and-answer session not printed 
here. ■ 



America's Foreign Policy Agenda 
in 1988 



Secretary Shultz's statement before 
the House Foreign Affairs Committee 
on February 2, 1988.^ 

I welcome this opportunity to share 
with you my thoughts on America's for- 
eign affairs agenda for the new calen- 
dar and fiscal years (FY). This is the 
sixth time we have met for this pur- 
pose, and the budget you will soon be 
considering will provide the resources 
and lay the groundwork as the next Ad- 
ministration implants its foreign policy 
initiatives. 

Progress in Foreign Policy 

America's broad foreign policy interests 
and objectives are as old as our nation 
itself: promoting domestic prosperity; 
protecting the safety of our nation 
against aggression or subversion; com- 
batting those activities which would un- 
dermine the rule of law and domestic 
stability; furthering our democratic val- 
ues and the cause of human rights. 



As we review these foreign policy 
interests and objectives and measure 
the progress the President has made 
toward their achievement, we can see 
that this Administration has developed 
an impressive legacy. These achieve- 
ments would not have been possible 
had the President not understood from 
the outset that America's democratic 
values, economic vitality, and military 
strength are the keys to success. 

In 1987, we made significant prog- 
ress on the President's foreign pohcy 
agenda. When President Reagan signed 
the INF [intermediate-range nuclear 
forces] agreement with General Secre- 
tary Gorbachev in December, he ful- 
filled a major arms control objective of 
the NATO alliance and realized the goal 
he set in 1981 when he first presented 
the zero option. And we continued our 
high-level dialogue with the Soviets on 
our key concerns of human rights, re- 
gional, and bilateral matters. The Pres- 
ident has laid the groundwork for a 
more stable and constructive U.S.- 
Soviet relationship based on strength, 
realism, and dialogue. 



11988 



43 



THE SECRETARY 



Throughout the world, democracy 
continued to take root and grow on an 
impressive scale, and the United States 
has encouraged the vital process of 
democratic institution-building. In the 
Philippines, we have supported the 
Aquino government in its efforts to 
consolidate its achievement of democ- 
racy by promoting economic recovery 
and helping to defeat the communist 
insurgency. In Korea, the elections 
clearly demonstrated the depth of dem- 
ocratic feeling within Korean society 
and the determination of the new lead- 
ership to establish a solid base for 
democratic processes in government. 
An interim civilian government has 
been restored in Fiji that has commit- 
ted itself to producing a new constitu- 
tion and returning the nation to 
parliamentary democracy. In Argen- 
tina, in Brazil, and throughout Latin 
America, we have worked hand in hand 
with new democratic forces. In Central 
America, the Guatemala agreement 
would not have been possible had the 
United States not combined diplomatic 
perseverance and military strength in 
behalf of democracy. 

In Afghanistan, Angola, Cambodia, 
and Nicaragua, our determined support 
for those fighting for their freedom has 
forced our adversaries to understand 
that expansionism and aggression are 
costly and that alien and repressive re- 
gimes will be challenged. 

With the reinforcing strengths of 
power and diplomacy, we have managed 
difficult crisis situations in the Middle 
East and elsewhere. In the strategic 
area of the Persian Gulf, our reflagging 
policy is protecting basic U.S. interests 
while we are leading the way in the UN 
Security Council to help end the Iran- 
Iraq conflict. This approach has been 
successful in preserving the security 
and stability of friendly states and avert- 
ing the spread of Soviet influence in the 
gulf. At the same time, it has ensured 
the free flow of oil through the Strait of 
Hormuz. Allies have followed our 
lead (France, Britain, Italy, the 
Netherlands, and Belgium). 

We are more determined than ever 
to continue helping countries eradicate 
narcotic crops and interdict drug ship- 
ments through our international narcot- 
ics program, and we are educating our 
own public and others about the dan- 
gers of narcotics. At least 20 countries 
eradicated narcotics crops in 1987. 
Worldwide interest and broader sup- 
port from our allies was generated by 
the very successful UN conference on 
drug abuse and trafficking last June. 
The National Drug Policy Board is 
completing work on a new national 



strategy, including a strengthened in- 
ternational program in which we are 
emphasizing chemical destruction of 
coca plants. 

We are severely challenged by the 
scourge of international drug traffick- 
ing — not only by the sheer volume of 
narcotics production but by the com- 
bined assault of drug traffickers and in- 
surgents on the governments whose 
cooperation is vital to our success in 
combatting this menace. Only last 
week, the Government of Colombia 
once again paid the price of narcotics 
control when traffickers murdered their 
attorney general. Make no mistake; this 
is a long-term effort. 

We must remain determined and 
vigilant as well with respect to the 
modern-day barbarity of terrorism. I 
can report today, however, that our 
counterterrorism policy is bringing re- 
sults. We have developed a better un- 
derstanding of terrorist methods. We 
have improved our counterintelligence 
and cooperation with other concerned 
governments. We have strengthened se- 
curity measures to protect our citizens 
at home and abroad. And we have gone 
on the offensive to bring terrorists to 
justice, disrupt their operations, and 
destroy their networks. The statistics 
are good. American casualties and 
attacks against U.S. interests are 
dramatically down. Our gains are wide 
ranging — from improved operational 
structures at home to closer allied coor- 
dination overseas. 

The Agenda for 1988 

So 1987 was a year of important ad- 
vances; 1988 promises to be even 
busier, with an exceptionally full for- 
eign policy agenda. Much of our agenda 
will involve building on the initiatives 
for peace, security, prosperity, and 
democracy that the President has made 
over the past 7 years. 

U.S. -Soviet Relations and Arms 
Control. One major priority will be 
pressing ahead on the START [strate- 
gic arms reduction talks] negotiations 
and the other elements of the Presi- 
dent's four- part agenda for U.S. -Soviet 
relations in anticipation of the Moscow 
summit. If the Soviets are prepared to 
match the effort we are making, we 
may be able to take a giant step in 
arms reduction this year and reach a 
verifiable agreement to enhance sta- 
bility by cutting strategic nuclear 
weapons by 50%. The Soviets know we 
will stand firm on SDI [Strategic De- 
fense Initiative]. 



We hope to consolidate the ma 
success of 1987 by gaining Senate a 
vice and consent to ratification of t; 
INF Treaty. We will move forward I 
our allies to modernize our conventl' 
and nuclear forces on the basis of p III 
grams established well before the ]f 
Treaty. We will strive for additional^' 
progress in arms control according • ■ 
NATO's agreed priorities — above all' 
eliminating conventional disparities (•' 
Europe and achieving a truly verifit 
global ban on chemical weapons. I 

But important as it is, arms cci 
is not and will not be our only prio 
with the Soviet Union; we will cont 
vigorously to pursue questions of h 
man rights, both individual cases a*l 
broader concerns of principle whicl 
enshrined in the Helsinki Final Ac 
other international human rights ir 
struments. And, from now on, leac 
up to the next summit in Moscow, 
eign Minister Shevardnadze and I ■ 
meet on a regular basis to discuss 
full range of our concerns. 

Central American Peace Pro( 

One of the most serious matters th 
100th Congress will have to decide 
how to continue our support for th 
democratic resistance forces fightii 
Nicaragua. If the Central America 
mocracies are to succeed in inducir 
the Sandinistas to comply with the | 
Guatemala agreement, our support ■ 
democracy must remain a certaint\ M 
an unknown variable in the region; ^^ 
equation. (■ 

In Central America today, the || 
peratives of human rights, free ele || 
tions, and economic development a ,, 
receiving the kind of attention that |j 
U.S. policymakers once reserved V' 
more traditional concerns of diplon Sj 
and national security. U.S. policy i|^ 
pressing our national conviction th | 
democracy is the only lasting founc r. 
tion for peace and prosperity — for ft 
neighbors as well as for ourselves, li 
for the Nicaraguan resistance is or, 
reason this broad regional strategy ) 
working. 

Ten years ago, Costa Rica was n 
region's only civilian-led democracy (I 
day, the military dictators who ruh, 
the other four countries are all goi 
Three of the countries are moving 
in Costa Rica's direction, with in- 
creasingly open societies and with |V 
ian presidents chosen in competitiv| 
elections. In the last 2 weeks, the , 
rulers of the fifth country, Nicarag^ 
Sandinistas, have begun to tell eve - 
one that they, too, are going to opt 
and respect democratic principles. 



44 



Department of State Bui 



THE SECRETARY 



V democratic Nicaragua would be 
news, indeed, for the United 
s. FUit a new RAND Corporation 
n includes that today Nicaragua is 
n the way to becoming a Soviet 
, particularly in military matters. 
t and indirect Soviet military use 
icaraguan territory, the RAND 
a; makes clear, can be expected in 
leuture. A democratic Nicaragua 
od not provide basing options to the 
c«!t Union in our immediate 
eiiborhood. 

\ democratic Nicaragua would also 
• )od news for Nicarguans. Another 
study, this one by my own depart- 
, reveals that popular opposition to 
i€ Sandinistas is closely linked to the 
i\i\ of basic freedoms. Last week, I 
■p the exiled directors of the Nic- 
lan resistance. Ten years ago, 
■ of them were jailed by Somoza. 
t years ago, one was a member of 
Mist-Somoza governing junta, one 
.■a the junta's secretary, one was a 
eirter for La Prensa. and three 
;i political leaders preparing their 
es for elections. Then the Sand- 
as signed a party-to-party agree- 
i( : with the Communist Party of the 
lo et Union, packed the Nicaraguan 
!( icil of State, and postponed elec- 
i( 5 for 5 years. A democratic Nic- 
r ua would not drive leading citizens 
a' exile or hold nearly 10,000 political 
ir jners. 

The problem is that the hard- 
i€ led people who for 8 years have 
A fully combined force and propa- 
^ la to monopolize Nicaragua's gov- 
't nent will not suddenly open up to 
il w democratic competition if our own 
1« lestic politics make it impossible for 
U support freedom in Nicaragua. To 
ii ;inue the democratic processes now 
I illy but broadly underway in Cen- 
a America will require something of 
l^ryone. For the United States, a key 
flfuirement is that we provide enough 
Mport for Nicaraguan democrats to 
) in to offset the military and security 
liistance the Soviet bloc has invested 
1 he Sandinistas. 

There is a great irony here. Our 
Jiate comes at a time when the Nic- 
1 guan resistance is demonstrating 
' h indigenous support and opera- 
lal skill and the Sandinistas are 
ng support. That is why the Sand- 
tas are working so hard to prevent 
i ^ Congress from deciding in favor of 
( itinued aid. If the Sandinistas get 
V at they want — if Congress fails to 
jrove our request for additional 
ids carefully tailored to progress in 
' peace process — we can be certain 



that no meaningful progress in the di- 
rection of moderation and democracy in 
Nicaragua will occur. 

There is a clear parallel between 
our efforts in Central America and 
our longstanding efforts to bring the 
Soviets to the negotiating table on 
meaningful nuclear arms reductions. 
We knew that we had to make clear to 
the Soviets by our actions, not just our 
words, that it was in their own inter- 
ests to come to the table to negotiate. 
What was not possible in the 1970s be- 
came possible in 1987 because we are 
strong and our aUiance is solid. 

Eight years ago, in response to So- 
viet deployments of SS-20 intermedi- 
ate-range missiles in Europe, which 
began in the late 1970s, NATO agreed 
upon a two-track strategy: deployment 
of Pershing II and ground-launched 
cruise missiles and U.S. -Soviet negotia- 
tions to establish a balance at the 
lowest possible level. In 1981, President 
Reagan proposed the "zero option" to 
eliminate all long-range INF missiles. 
We and our allies hung tough with our 
decision. We began deployments at the 
end of 1983, despite Soviet efforts at 
intimidation and their year-long walk- 
out from negotiations. Our resolve 
brought the Soviets back to the table in 
early 1985. Building on this successful 
model, if we display the same resolve 
and strength in our strategic programs 
and at the negotiating table, there are 
real prospects for success in START. 

During this long effort, there were 
those who argued that building up our 
military strength and deployment of 
our missiles was the cause of the prob- 
lem, not its solution. Remember the 
"freeze movement." And remember how 
wrong it has turned out to be. I am 
happy that the American people and 
their elected representatives refused to 
listen and gave us the means to carry 
out our strategy. It worked. We have 
achieved a first step — the INF agree- 
ment — and we stand on the brink of 
even greater gains in the arms control 
and disarmament field. 

In Central America, as in Europe 
and Afghanistan, we have put power 
behind our pohtical and diplomatic ob- 
jectives. We have made it possible for 
Central Americans willing to work for 
freedom to have the resources to do so. 
And as with INF and Afghanistan, our 
strategy is working. Support for the 
Nicaraguan resistance is today the ele- 
ment of power needed to induce the 
Sandinistas to comply with the terms of 
the Guatemala accord for peace and 
democracy. 



Ninety percent of the funds in the 
Administration's request is for non- 
lethal aid, such as food, clothing, medi- 
cine, and the means to deliver it. Ten 
percent is for ammunition. And this 
part of the request will be suspended 
until March 31st to determine if the 
Sandinistas are truly complying with 
the promises they made in Guatemala 
in August and in San Jose last month, 
to take irreversible steps to democracy 
in Nicaragua. In reaching this judg- 
ment, the President has committed 
himself to consult personally the presi- 
dents of the four Central American 
democracies. 

Last November and again last 
week, the President indicated that once 
serious negotiations between the Nic- 
araguan resistance and the Sandinista 
government are underway, he would 
consider having me enter regional talks 
in Central America with represent- 
atives of all five countries, including 
Nicaragua. I am prepared to do that 
when the conditions are right. 

As Secretary of State, I am com- 
mitted to diplomacy and to pursuing 
negotiations even in the face of the 
most daunting odds. As a practical 
man, I also know that negotiations are 
likely to be genuine only when both 
sides believe they have something to 
gain. The abandonment of the strategy 
and the people that have put the com- 
munists on the defensive — in Nicaragua 
and elsewhere in Central America, for 
the first time in a decade — will not in- 
duce continued progress. Continued 
progress toward democracy in Nic- 
aragua and peace in Central America 
depends critically on continued U.S. 
support for the Nicaraguan resistance. 

Other Regional Conflicts. Just as 
it has furthered the arms control and 
Central American peace processes, so 
the combination of diplomatic per- 
severance and political firmness has 
caused our adversaries in other areas to 
see that expansionism and aggression 
are costly. 

Perseverance and firmness are the 
path to peace in Afghanistan as well. 
We will continue our support for 
Pakistan and will continue to press 
Moscow to withdraw its troops expedi- 
tiously. We must assure that the provi- 
sions of the Geneva accords regarding 
withdrawal are credible and verifiable 
and that they do not put the resistance 
at risk. When we are satisfied that the 
Soviets have fulfilled these conditions, 
the United States will be prepared to 
sign on as a guarantor to the Geneva 
agreements. The United States remains 
fully and firmly committed to the goals 



Iril 1988 



45 



THE SECRETARY 



that the Afghan people, their leaders 
on the battlefield, in Pakistan, and in 
exile have stated clearly and repeat- 
edly: rapid departure of Soviet forces; 
genuine self-determination; neutrality; 
return of the refugees. 

The recent turmoil in the West 
Bank and Gaza Strip demonstrates that 
the status quo in the Middle East peace 
process is not an option. The time has 
come to reinvigorate the process by 
showing Arabs and Israelis that nego- 
tiations can produce a better life for 
people in the occupied territories, en- 
sure Israel's security and well-being, 
and point the way to a negotiated set- 
tlement of the conflict. We need to 
focus less on procedure than on sub- 
stance, in order to show people that a 
negotiating process can meet their real 
concerns. We will be energetic in our 
consultations with leaders in both Is- 
rael and the Arab community as we 
seek to spur a new drive toward peace. 

International efforts to bring an 
end to the Iran- Iraq war and stability 
to the Persian Gulf remain front-burner 
issues for us. We seek a comprehensive 
solution to hostilities on land, at sea, 
and in the air. UN Security Council 
Resolution 598 provides a reliable 
framework for ending the war without 
victor or vanquished. It is a balanced 
document, demanding action on the 
part of both combatants. Iraq has 
agreed to comply unequivocally with its 
terms; Iran steadfastly refuses to com- 
ply. The Security Council must move 
quickly to impose sanctions against the 
Tehran government as the noncompliant 
party to the resolution. We and several 
members of the Council are in near- 
daily consultation in an attempt to gen- 
erate unanimity in the Council for an 
arms embargo against Iran. While we 
want Soviet cooperation in an embargo, 
we will continue to stand by the se- 
curity commitments we have made to 
our friends in the region, and we will 
seek case-by-case assistance in staunch- 
ing the flow of arms to Iran. 

In East Asia, we will continue 
actively supporting all our allies. This 
includes assisting President Aquino 
in leading her nation in building 
democracy and accelerating economic 
growth as the Philippines contends 
with a virulent communist insurgency. 
We support ASEAN [Association of 
South East Asian Nations] and the 
Cambodian noncommunist resistance in 
their efforts to bring about a political 
solution to a Cambodian conflict. The 
solution must encompass a Vietnamese 
troop withdrawal from Cambodia and 
self-determination for the Cambodian 



people. The Republic of Korea can 
count on our full support as it seeks 
international condemnation of North 
Korea for its barbaric terrorist bomb- 
ing of Korean Air Flight 858 last 
November. We will cooperate fully with 
the Republic of Korea as it strives to 
host the 1988 Olympics in a secure 
atmosphere. 

And, in southern Africa, we are 
continuing our efforts to achieve a ne- 
gotiated settlement involving with- 
drawal of all foreign military forces 
from Angola and Namibia and Nami- 
bian independence in accordance with 
UN Resolution 435. There have been 
several meetings with the Angolan 
leadership in recent months. At the 
last such meeting in Luanda just last 
week, the Angolans recognized that 
there would have to be a total with- 
drawal of Cuban forces from their coun- 
try, rather than the partial withdrawal 
they had earlier proposed. Cuban rep- 
resentatives joined the talks briefly as 
members of the Angolan delegation to 
confirm this. This is an important de- 
velopment that holds out the promise of 
a settlement of the Angola/Namibia 
tangle. We now look to the Angolans to 
table concrete and realistic schedules 
for a phased withdrawal of Cuban 
forces, so that we can take this pro- 
posal to the South Africans. 

Apartheid is at the heart of many 
of southern Africa's most serious prob- 
lems. We seek a peaceful and rapid end 
to apartheid and to foster negotiations 
among all parties that will lead to the 
creation of a democratic society with 
equal rights for all South Africans. We 
remain firm in our belief that this can 
best be accomplished through a mix of 
diplomatic and political pressures on 
the one hand and a series of positive 
initiatives on the other, including 
strong support for U.S. programs de- 
signed to assist victims of apartheid 
and to empower black South Africans 
to achieve their own peaceful liberation. 
The United States will take every op- 
portunity to contribute to national rec- 
onciliation among South Africans. 

In the South Pacific, ANZUS [Se- 
curity Treaty Between Australia, New 
Zealand, and the United States] con- 
tinues to contribute to the collective 
strength and vigor of the Western sys- 
tem of defense alliances. In Australia, 
we have a key ally with whom this al- 
liance remains intact and effective, 
despite our suspension of security guar- 
antees to New Zealand. 

Beyond our alliance relationships 
with Asian states, ties with China have 
reached a new level of maturity, and we 



will continue to work on issues tha 
main unresolved between our two i 
tries. I will be meeting with Foreij 
Minister Wu in March to build upo 
possibilities for greater cooperatioi m 
bilateral matters and for U.S.-Chirje 
cooperation in resolving pressing pib- 
lems of international consequence. 

Global Issues. In 1988, we mu 
strengthen cooperative internation: 
efforts to deal with other issues of 
global impact. 

In the economic field, we face a- 
jor challenges at home and abroad 
which we must meet by a firm con \it- 
ment to market-oriented policies. '^ ! 
must sustain our resistance to prot ;- 
tionism. As we have with the U.S. laii 
ada Free Trade Agreement and ou far 
reaching GATT [General Agreeme:ior 
Tariffs and Trade] proposals, we m tt 
choose the path which opens mark 5 
and increases the material well-bei f o 
all trading nations. We look forwai to 
expeditious ratification of the free •at- 
agreement by the Senate. 

The United States will active] 
pursue human rights issues relate^ ;o 
these and other conflicts throughc 
the world at the appropriate forun of 
the United Nations. We intend to i- 
sure that greater attention is paid i 
UN bodies to the rights of Individ ils 
particularly the rights to free spe' ti, 
freedom of association, religious li irt 
and other fundamental freedoms. 

Allied Cooperation and Impi n\ 
Bilateral Relationships. While w. k- 
ing toward solution of the world's r- 
sistent problems, we must mainta la: 
strengthen our alliance relationshi ., 
which are essential to our nationa le- 
curity and the bedrock of our fore 1 
policy. Allied solidarity over the p t 
years has strengthened our defens 
posture and advanced the arms co ir( 
process. On March 2-3, President ei 
gan will travel to Brussels for a si m 
with NATO leaders to discuss the ot 
INF security agenda and continue t 
the highest level the pattern of cK ■ 
allied consultation that has served .^ 
well. 

Allied cooperation in controlli ; 
the export of strategic goods to V\ 's 
Pact countries has improved signil 
cantly in recent months. At a higl ' 
successful meeting in Versailles l;i 
week, we and our COCOM [Coon I . 
ing Committee for Multilateral Se r 
Export Controls] partners reaffinef 
full political support for vigorous a- 
forcement of strategic export cont il 
and demonstrated that multinatioi 1 
operation is the most effective wa;t( 



46 



Department of State Bile 



THE SECRETARY 



otect against breaches in our mutual 
■'curity such as occurred in the 
'shiba/Kongsberg case. 

And the recent visit of Prime Min- 
ler Tkkeshita underlined the funda- 
i?ntal political and economic strength 
(Our relationship with Japan. The 
S. -Japan Treaty of Mutual Coopera- 
tm and Security is the foundation on 
lich our relationship rests and is a 
:;nificant factor contributing to the se- 
■ rity of the Asia- Pacific region. With 
.,e T^keshita government, we will be 
)rking to sustain international eco- 
imic growth by removing impediments 
; trade, expanding access to markets, 
id opposing forces of protectionism. 
' In addition to our aUiance rela- 
mships with NATO countries and 
I pan, the United States enjoys simi- 
•ly strong relations with other Asian 
I d Pacific nations, most notably 
jiailand, Korea, the Philippines, and 
jistralia. The continued strength of 
e alliance between the United States 
d Thailand is symbolized by the re- 
nt establishment of the War Reserve 
ockpile, which will permit American 
ilitary supplies to be kept in Thailand 
r use in a nation-threatening erner- 
•ncy. Our security relationship with 
e Republic of Korea, based on the 
utual Security Treaty of 1954 and sus- 
ined by the continued need to deter 
;gression on the Korean Peninsula, re- 
ains strong and effective. 

In the Philippines, we have unique 
)litical, economic, and security inter- 
its at stake. Our two countries have 
ijoyed a long history of close relations 
id share a democratic tradition — one 
hich will require ongoing U.S. sup- 
)rt. Furthermore, U.S. facilities at 
ubic Naval Base and Clark Air Base 
rotect bilateral and multilateral se- 
irity interests. 

The global economy is in a period 
'profound change. New technologies 
nd the Information Revolution promise 
le opportunity for unprecedented eco- 
omic progress for developed and devel- 
ping countries alike. America and 
ther open societies are well positioned 
make the most of the changes now 
nderway. But first we must address 
he contemporary global economic im- 
alances which could threaten our 
'right future. We will work to promote 
lolicies that help enable markets to 
lalance international trading patterns, 
tabilize financial flows, and avoid 
harp setbacks to stable economic 
nx)wth and freer trade. 

We must also continue to support 
he economic and social development of 



friends and allies in Latin America, Af- 
rica, Asia, and the Middle East. The 
tools at our disposal for this purpose 
include bilateral financial and technical 
assistance, training, and active support 
for the important work of multilateral 
institutions such as the World Bank, 
the regional development banks, the In- 
ternational Monetary Fund, the UN 
Development Program, UNICEF [UN 
Children's Fund], and the specialized 
UN agencies. 

Equitable and sustained growth in 
the developing countries is crucial to 
achievement of our security, economic, 
and humanitarian objectives. It re- 
quires internal structural changes in 
the economies of developing countries 
as well as outside support that encour- 
ages flows of trade, capital, and tech- 
nology. If it occurs, the prospects are 
good for a continuation of the healthy 
trend we have witnessed in recent 
years toward strengthening of demo- 
cratic and free-market-oriented institu- 
tions around the world. 

We will continue our unequivocal, 
strong support for the new democracies 
in Latin American, South Korea, the 
Philippines, and elsewhere as they seek 
greater internal stability. We must 
recognize that democratic institution- 
building is a slow and often fragile pro- 
cess. Yet, the trend toward democracy 
is growing around the world on an im- 
pressive scale, reaffirming American 
values and the effectiveness of our 
policies. 

We will press ahead in our deter- 
mined efforts against international drug 
trafficking and terrorism, and I can as- 
sure you that we will continue to give 
these issues a high foreign policy 
priority. 

These issues of global impact do 
not lend themselves to simple, uni- 
lateral solutions. Rather, they require 
sustained multilateral cooperation. The 
United Nations and its speciahzed 
agencies are contributing to the solu- 
tion of many of the world's shared prob- 
lems — drug abuse, air piracy, AIDS 
[acquired immune deficiency syndrome] 
research, to name a few. We must sus- 
tain our active support for these in- 
stitutions, while continuing to seek 
significant reform of the UN system for 
allocating funds. 

In sum, this will be an excep- 
tionally busy year: for making as much 
progress as we can on the full range of 
issues that comprise our foreign poHcy; 
for consolidating achievements where 
we can; for working away at enduring 
problems as we must; and for taking 
new initiatives where they seem useful 



and promising. I will now turn to the 
practical question of the means we will 
need to accomplish our goals. 

The 1988 Foreign Affairs Budget 

Last year at this time when we met, I 
spoke at length about the resource is- 
sues posed by the foreign affairs bud- 
get. Indeed, budgetary issues still loom 
so large that when I refer to "the 1987 
summit" in conversations with my col- 
leagues, I mean the budget summit — 
not the one with Gorbachev. 

Over the past months, the State 
Department has engaged intensively 
with Congress in the rough-and-tumble 
business of executive-legislative cooper- 
ation in order to reduce the Federal 
deficit in the way that does not harm 
our foreign policy interests. We have 
made headway. The agreement reached 
at the budget summit puts a little more 
flesh on the bones of our foreign affairs 
budget for FY 1988 than would other- 
vidse have been the case. But our bud- 
get is still a painfully thin and rigid 
creature. 

In the next few weeks, we will be 
submitting to the Congress our foreign 
affairs request for FY 1989. You will 
not be surprised by our request. Al- 
though I cannot now discuss the de- 
tailed numbers with you, since the 
budget will not be formally released by 
the White House for another 2 weeks, 
suffice it to say that it will be very 
spare, in keeping with the agreement 
at the budget summit. 

When you have had a chance to 
study our budget presentation and to 
examine Administration witnesses 
about our proposals, I know you will 
agree we have taken a very hard look 
at the programs we support and the 
resources we need to manage them. In 
fact, after taking into account antici- 
pated inflation, the buying power of the 
budget we will propose will be some- 
what less than this year's, which in it- 
self represented a substantial reduction 
from the levels of recent years. We can- 
not do with any less. We would have 
liked more. 

I want to be clear that the moder- 
ate request we will be proposing in 
order to meet the budget summit re- 
quirements in no way reflects any di- 
minution in the scope of our foreign 
affairs interests; in the depth of our 
commitments to friends, allies, and the 
international system; or in the amount 
of resources we consider necessary in 
order to pursue those interests and 
meet those commitments. Rather, our 
very tight request reflects an uneasy 



^pril 1988 



47 



THE SECRETARY 



compromise between our minimum for- 
eign policy needs and our recognition 
that we must play our part to reduce 
the deficit. But we cannot defend our 
interests and meet our most basic obli- 
gations without adequate resources and 
the flexibility to apply them to meet 
the highest priority needs. 

On your part, in turn, we need a 
willingness in Congress to give the ex- 
ecutive branch the latitude we need to 
manage our very limited resources ef- 
fectively. I do not question Congress' 
authority to control the purse strings. 
Yet, as you know, the resources appro- 
priated in the continuing resolution 
are almost completely earmarked by 
Congress for particular countries or 
programs — 97% in the case of the eco- 
nomic support fund and 99% for the 
foreign military sales program. That 
leaves us no flexibility to provide ade- 
quate resources to countries which af- 
ford us vital bases and other defense 
facilities, such as Kenya, Somalia, Por- 
tugal, and Turkey. And it leaves vir- 
tually no security assistance funding for 
such important countries as Bolivia, 
Ecuador, the Dominican Republic, 
Jamaica, and Indonesia. 

If we are to reduce the Federal 
budget deficit — which we must — and 
advance our foreign policy interests — 
which are vital — we need greater flexi- 
bility within the budget framework to 
allocate the funds you have appropri- 
ated. The excessive earmarking which 
characterizes this continuing resolution 
and the multitude of amendments 
accompanying it regarding foreign pol- 
icy and State Department operations 
are not minor hindrances. If continued, 
they threaten the executive branch's 
ability to conduct the nation's foreign 
policy. 

We know that the executive branch 
must do its part to obtain the needed 
flexibility. We must increase congres- 
sional confidence that we will manage 
our financial resources efficiently and 
effectively to achieve commonly agreed 
goals. And the Department of State 
would welcome consultations with Con- 
gress to that end. 

Bipartisanship 

Throughout my tenure as Secretary of 
State, I have been a strong and vocal 
advocate of three things in foreign pol- 
icy, and I trust that the record will 
show that I have practiced what I 
preach. As I see them, the three 



essentials of any successful foreign 
policy initiative are: 

• Clarity of purpose; 

• Staying power; and 

• Bipartisan support. 

That is why I have been and 
remain a strong and vocal advocate 
of meaningful consultation between 
the Hill and the Administration. Late 
last year, some Members of Congress 



pointed out the need for greater bip 
tisanship in foreign policy. Theirs 
approach which I have endorsed. Ai 
I remain willing to do all I can this 
year to lay the foundation for truly 
bipartisan cooperation. 

|)l> 

'The complete transcript of the he: |* 
ings will be published by the committe 
and will be available from the SuperinI 
ent of Documents, U.S. Government P 
ing Office, Washington, D.C. 20402. 



Secretary's Interview on 

"This Week With David Brinkley" 



Excerpts from Secretary Shultz's 
interview on ABC-TV's "This Week 
With David Brinkley" on January 31, 
1988, by David Brinkley and Sam 
Donaldson, ABC News, and George F. 
Will, ABC News analyst.^ 

Q. Now, we've just talked to the two 
whips of the House, as you have 
heard, and we ended on an argumen- 
tative note about what, actually, the 
President is asking for in terms of 
money for the contras: (a) how much, 
they disagreed on; (b) how much of it 
is for humanitarian aid and how 
much is for ammunition and so on? 
Can you clear that up? 

A. Simple. He is asking for $36 
million for around 4 months or so, 
about 10% of which is for military 
assistance. 

Q. What was the $70-odd million 
that [Representative Tony] Coelho 
was talking about? 

A. That's just something he got out 
of his imagination. 

Q. All right. 

A. There is a written document, 
and that's what it says. 

Q. If I may, I think he was pro- 
jecting that after 4 months, you 
might want more money if in fact the 
matter has not been resolved — and 
he's looking toward the end of the 
Administration. 

A. If there is a need for more 
money, we'll ask for it. 

Q. And also he was building in 
the $20 million, I think, which is a 
separate appropriation matter, money 
already appropriated, which you 
would use to transport material. Is 
that not correct? 



d 



I 



A. No, that's a matter of an ins* 
ance policy to enable there to be ar 
airplane leased. And that's been all 
front and described as part of the \ 
age. But the appropriated funds ar 
$36 million. 

Q. Is it possible for the contn 
win the war, that is not get to a r™ 
tiating table, but get to power, ge 
the capital? 

A. Their object is to change th 
nature of government in Nicaragua 
making it more democratic, more c 
patible with what's going on in the 
gion. And I think it's certainly pos 
to make that kind of change. And 
through the evolution of the Presid' 
policies, which have been in place 1 
years, we have seen just that happ 
in El Salvador, in Honduras, and ii 
Guatemala where you now have civ 
elected presidents. 

Q. But you didn't — 

A. And in Nicaragua, we see, , 
result of the strategy that's in 
place, that the Nicaraguans signed 
Guatemala City a set of undertakin 
that amount to the operational cha. 
teristics of democracy. They went t 
San Jose, and contrary to what wa. ; i 
said earlier on the program, the fi\ X. 
presidents did not agree in San Jos .f ' 
The four who were elected by dem( u" 
cratic means really worked the Nic j^i 
araguan communist representative C 
for not living up to what he agreed >£ 
in Guatemala City, and said so at t , T 
outcome. Now, the pressure is on. W. 
what we have on our hands here is 
success for the President's policy o 
pressure and diplomacy working to 
gether. And it seems unbelievable I at 
we're even debating the idea that \ 



r 



48 



Department of State Btte 



THE SECRETARY 



Cl pull the rug out from under a 
ssful strategy just when it's 
|ly working. 

^. Something strange has hap- 
nd in American foreign policy and 
treneral partisanship when you 
i| Members of Congress, in effect, 
ning — have they not been? — advis- 
tihe Ortega regime, the commu- 
iiregime in Nicaragua, on how to 
fit the President's policy in 
i:ress. 

V. It's appalling. It is really 
ailing. 

J. Now, you said a moment — 

V. However, we have to focus on, 
' it is the right thing for the United 
) s right now?" And clearly, the 
i thing for the United States in 
iral America is peace, as Represen- 
J5 [Trent] Lott said, peace — but not 
peace: peace with freedom, peace 
widely shared economic develop- 
I . That's what we're trying to get, 
I ve're getting there. 

3. The reason some people are 
(varm, at most, about contra aid 
ey can't see how you get to your 
ome. There's no precedent any- 
•e in the world for a Marxist re- 

; negotiating down to pluralism, 
any concessions that Ortega 
es, sufficient to kill contra aid, 
•evokable. So aren't the cards in 
land over time? 

4. We need to keep the pressure 
ntil we can find ourselves to a place 
•e the momentum of democracy be- 
!S very powerful, and that's the 

Q. Now, that — then the question 
le criteria — you said a minute ago 

we might need to ask for more 
ey. What are the criteria that 
Itz or Reagan would have to say: 

right. That's it. We don't need to 
)ort the contras because X, Y, and 
IS happened in Nicaragua." 
What are X, Y, and Z? 
A. If you have a satisfactory nego- 
id cease-fire, you don't need to sup- 
more military assistance because 
e is a cease-fire. A satisfactory 
e-fire is hooked into the kind of 
edures that the Guatemala City 
:ement that the five agreed on, put 
lace, such as: amnesty, freedom to 
ish, freedom to broadcast on radio, 
edures for deciding on who is going 
e the representative, and so on. 
5e are the things that characterize a 
alistic, democratic system which 
iga agreed to, so let's get them in 



Q. There were reports this morn- 
ing that if the Administration loses 
the vote on Capitol Hill, that you 
will, nevertheless, continue to try to 
find funds to support the contras, in- 
cluding perhaps going once again to 
third countries. Would you do that? 

A. There isn't any basis for that 
statement, but there certainly is a 
basis for saying that as far as President 
Reagan is concerned and as far as I'm 
concerned, I'm never going to give up 
on peace with freedom in Central 
America. Those are important objec- 
tives for us, and we will keep trying, 
but — and I don't even want to contem- 
plate the kind of outcome that goes 
with pulling out the rug from a strat- 
egy that has produced where we are 
now. 

Q. But, Mr. Secretary — 

A. People say, "Isn't it wonderful 
that there is this negotiation, and that 
finally there is a direct negotiation be- 
tween the freedom fighters and the 
Government of Nicaragua?" 

That is something we have been 
calling for for years. 

Q. But I'm confused — 

A. And it's finally happened. 

Q. — about your answer. 

A. And people say, "Isn't it won- 
derful. Now, we should just quit on the 
job." 

I say, "No. Carry through on what 
has given you success." 

Q. You make your argument very 
forcefully, of course. But I'm con- 
fused as to your answer — 

A. It's correct. It isn't just force- 
ful. It's correct. 

Q. — because you say that you 
think you'll never give up on the 
contras. But you have made the point 
in over the last 18 months "in spades" 
that the law will be obeyed, as far as 
George Shultz is concerned. 

A. It will be obeyed as far as all of 
us are concerned. 

Q. Now, at the moment, the Sen- 
ate not having passed it, you are — 
provision to try to prevent third-coun- 
try solicitation — as I understand it, it 
would be legal at the moment, to so- 
licit funds from third countries. My 
question to you is whether you would 
contemplate doing that should you 
lose the vote? 

A. We're going to wnin this vote, 
and we're going all out to do soothe 
President is fully engaged, and that's 
where we're going — and I believe we 



will, basically, because it is so ob- 
viously right for America. We're on the 
right side; we're on the side of freedom; 
we're on the side of an open system. 
We're absolutely right. We're on a 
sound basis here. 

Q. But what is the answer to my 
question? 

A. Why should I answer your ques- 
tion, an iffy question? 

Q. You have a right not to answer 
it, if you choose, but I'm trying to get 
you to make a choice. 

A. That's my choice. 

Q. — exercising the right not to 
answer. [Laughter] 

A. The reason I didn't want to an- 
swer your question is that the minute 
you start talking about what you're 
going to do if you lose, you've lost. And 
I intend to win, and the President 
intends to win. 

Q. Okay. 

A. That's our orientation. 



Q. The INF [intermediate-range 
nuclear forces] agreement is an ac- 
complished fact and will be ratified. 
And the next Soviet goal in Europe is 
the so-called triple zero: to get rid of 
all nuclear weapons, a denuclearized 
Europe. That would presuppose for 
American security an increase of con- 
ventional forces on the part of our 
NATO [North Atlantic Treaty Organi- 
zation] — 

A. We're not going to agree to 
that, or it is not in the priority of 
things to negotiate about right now. 
What is in our priority in negotiations 
are, first of all, between us and the 
Soviets, an agreement to reduce strate- 
gic arms by 50%; second of all, to work 
out a mandate, so-called, for negotia- 
tions about the conventional arms im- 
balances — that does not include 
anything to do with nuclear arms — and 
third, we want to work out, if it's at all 
possible, a worldwide ban on chemical 
weapons, and we're working hard on 
that. 

Those are the three priority objec- 
tives. Our European allies agree on 
those priorities. And after all of those 
things are done, then and only then 
would it be appropriate to start looking 
again at the nuclear [inaudible]. 

Q. Given the complexity of a 
START [strategic arms reduction 
talks]— 



11988 



49 



ARMS CONTROL 



A. In the meantime, there are a 
great many nuclear weapons left in Eu- 
rope so that the NATO policy of flexi- 
ble response is fully implementable. 

Q. Is there enough time left in 
the Reagan Administration, particu- 
larly the time between now and the 
early summer summit, to do anything 
more than a Vladivostok approach — a 
general, numerical formulation 
agreed to between the two parties on 
a START agreement? 

A. It's possible to work out a full 
treaty, although it will be difficult. 

Q. Do you expect it? 

A. I am not an odds-maker. I am a 
worker, and my job is to try to turn 
something that's possible into some- 
thing that happens, and we'll work at it 
very hard, and I don't know the 
answer. 

Q. Let me swerve back to the 
contras for a minute. If the Soviet 
Union were not supporting the San- 
dinista regime, no one would care 
much, except the Nicaraguans, about 
how badly governed they are. We care 
because they have this disproportion- 
ate military force that they get from 
the Soviet Union. 

Is there nothing the Soviet Union 
wants from us in the way of credits, 
access to international financial in- 
stitutions — nothing we could link — 
that would make it worth their while 
to quit sending this kind of aid to 
Nicaragua? 

A. I don't think that we should ap- 
proach the subject of peace and democ- 
racy and freedom in our hemisphere on 
the basis of some sort of deal with the 
Soviet Union — not that we aren't inter- 
ested in their behavior or the ceasing of 
their behavior. But peace and freedom 
and widely shared economic develop- 
ment in our hemisphere is something 
that we need to work on, and work on 
it in terms of helping the people who 
are wiUing to fight for it right here in 
our own hemisphere. 



Q. One quick question before we 
go. You met this week with the Isra- 
elis, the Ambassador and others. Can 
you tell us anything about what is 
happening there, your view of it, and 
how you see a way to get out of it, if 
you do? 



A. We are in very active discus- 
sions with the key parties — with the 
Israelis, with the Jordanians, with the 
Egyptians, and in a lesser way with 
Palestinian leaders — and what I think 
we are seeing is that somehow, the dis- 
cussion about what should go on in the 
Middle East has become dominated by 
discussion of a process: "Should we 
have an international conference? 
Should we have direct negotiations or 
what?" And we see those processes 
going nowhere because there is no 
substance. 



And so what we're doing is, sa. 
"Let's talk some more about the su 
stance of what can be done right m 
help the situation on the West Banl 
and Gaza quickly," and second, "H( 
can we find our way to a sensible o 
come in the longer run?" We find p 
pie are very responsive on that, an 
think, maybe, if we can find a betti 
understanding about the substance 
then the procedural arguments wil 
seem less important, and we'll be ; 
to proceed. That's what we're doiiij 



'5E; 



'Press release 11 of Feb. 2, 1988. I 



Nuclear Testing Talks Open Round Two 



WHITE HOUSE STATEMENT, 
FEB. 12, 1988' 

On Monday, February 15, the United 
States and the Soviet Union will re- 
sume step-by-step negotiations on nu- 
clear testing with the opening of round 
two of these talks in Geneva. The nu- 
clear testing talks represent a practical 
approach — as the President has long 
advocated — to nuclear testing limita- 
tions which are in our national security 
interest. 

In undertaking these talks, the 
United States and the Soviet Union 
agreed as a first step to negotiate effec- 
tive verification measures for two exist- 
ing but unratified nuclear testing 
treaties — the Threshold Test Ban 
Treaty (TTBT) and the Peaceful Nu- 
clear Explosions Treaty (PNET). Once 
our verification concerns have been sat- 
isfied and the treaties ratified, we will 
propose that the United States and the 
Soviet Union immediately enter into 
negotiations on ways to implement a 
step-by-step program — in association 
with a program to reduce and ulti- 
mately eliminate nuclear weapons — of 
limiting and ultimately ending nuclear 
testing. 

We are making progress toward 
our goal of effective verification of the 
TTBT and the PNET. During General 
Secretary Gorbachev's visit to Wash- 
ington in December, the United States 
and the Soviet Union agreed to design 
and conduct joint verification experi- 
ments intended to facilitate agreement 



on effective verification of these tv 
treaties. These joint experiments, 
which will take place at each othei 
nuclear test site, will provide oppi 
tunities to measure the yield of nu 
explosions using techniques propo: 
by each side. Through these exper 
ments, we hope to provide the So\ 
Union with all the information the 
should need to accept U.S. use of 
CORRTEX [continuous reflectroni 
for radius vs. time experiment] — t 
most accurate technique we have 
fied for verification of the TTBT a 
the PNET 

We and the Soviets also agree 
visit each other's nuclear test sites 
the purpose of familiarizing oursel 
with the conditions and operation 
those test sites. These unpreceder 
visits — which build on an idea the 
ident first proposed in September 
1984 — took place last month in a c 
structive and cooperative atmospb 

With a better understanding c 
practical problems associated with 
ducting these experiments, we no' 
have the information needed to de 
the experiments. The two sides hs 
agreed to begin this work immedii 
upon resumption of negotiations oi 
Monday. We hope that the sides W' 
continue to make expeditious prog 
in these talks. 



'Te.xt from Weekly Compilation o 
Presidential Documents of Feb. 15, IS 



k 



50 



Department of State Btel 



m 



ARMS CONTROL 



Conference on Disarmament 
Feconvenes in Vienna 



PESIDENT'S STATEMENT, 

FB. 2, 19881 

r? Conference on Disarmament plays 
L important role in international en- 
livors to create a more stable and 
jiceful world. You resume your work 
li year that holds promise for realiz- 
I concrete steps toward this universal 
> ective. 

I am pleased to be able to report to 
n that we are making discernible 
jigress on all aspects of my Admin- 
cation's comprehensive agenda: re- 
i;tions in nuclear arms, peaceful 
itlement of regional conflicts, devel- 
; nent of confidence-building mea- 
! 'es, and advancement of human 
' hts and fundamental freedoms. 

The signing of the Intermediate- 
[nge Nuclear Forces (INF) Treaty 
s a historic event. For the first time, 
! United States and the Soviet Union 
.1 begin reducing nuclear arms. We 
pe that this beginning will be fol- 
ded by reaching agreement on our 
jposal for a 50% reduction in U.S. 
d Soviet strategic nuclear arsenals. 

In the field of nuclear testing, the 
lited States and the U.S.S.R. have 
gun full-scale, step-by-step negotia- 
ns with agreement on the needed 
rification improvements to existing 
eaties as the first step. Both sides 
ve also agreed that progress toward 
nning nuclear tests must be part of 
effective disarmament process. 

In Vienna we are working out the 
rms of reference for negotiations on 
nventional stability in Europe. In ad- 
tion, we are continuing the process, 
iiich was successfully initiated in 
ockholm, in the area of confidence- 
lilding measures. 

The Conference on Disarmament 
is an impressive agenda. Of special 
iportance is your effort on a conven- 
Dn banning chemical weapons. Prog- 
:ss has been made in narrowing 
fferences of principle; you now face 
le arduous task of working out the 
Jtails and finding solutions on issues 
hich affect vital security interests of 
1 our countries. General Secretary 
orbachev and I have reaffirmed our 
immitment to negotiations in the Con- 
rence on Disarmament, which would 



result in a truly effective, verifiable, 
and global ban on these terrible 
weapons. 

Under the capable leadership of 
Ambassador Ma.x Friedersdorf, the 
U.S. delegation will continue to work 
vdth you in resolving this and other 



difficult issues which engage this 
forum. I wish you Godspeed. 

'Read at the opening of the 1988 ses- 
sion of the conference by Ambassador Max 
L. Friedersdorf, head of the U.S. delega- 
tion (text from Weekly Compilation of 
Presidential Documents of Feb. 8, 1988). ■ 



Soviet Experts Visit U.S. Nuclear Test Site 



JOINT U.S.-SOVIET STATEMENT. 
JAN. 30, 19871 

In accordance with the joint statement 
issued in Washington on December 9, 
1987, by Secretary of State Shultz and 
Foreign Minister Shevardnadze, a 
group of 20 Soviet experts, led by Mr. 
Igor Palenykh, head of the Soviet dele- 
gation to the U.S. -Soviet full-scale ne- 
gotiations on the problems relating to 
nuclear testing, visited the U.S. nu- 
clear test site in Nevada from January 
25-30. The Soviet experts began their 
visit 1 week after the completion of a 
similar visit by 20 U.S. experts to the 
Soviet nuclear test site in the vicinity 
of Semipalatinsk. 

The purpose of these visits was to 
familiarize the experts of both sides 
with each side's nuclear test sites and 
the activities carried out there in order 
to provide a practical basis for the de- 
sign and conduct of the joint verifica- 
tion experiment which was agreed upon 
by the two sides at the first round of 
the negotiations in Geneva last 
November. The experiment is intended 
to enable the sides to agree on the im- 
proved verification measures necessary 
for the ratification of the U.S. -Soviet 
Threshold Test Ban Treaty of 1974 and 
the Peaceful Nuclear Explosions Treaty 
of 1976 and which also might be used, 
to the extent appropriate, in future 
agreements on further limitations on 
nuclear tests. 

During their visit, the Soviet ex- 
perts were briefed on the organization 
and operation of the U.S. test site, in- 
cluding the various stages in preparing 
for and conducting nuclear tests. The 



U.S. side fully demonstrated the tech- 
nique and equipment used in the 
CORRTEX [continuous reflectrometry 
for radius vs. time experiment] system 
of yield measurement. The two sides 
also extensively discussed hydro- 
dynamic and seismic nuclear yield 
measurement methods. 

The Soviet experts were housed in 
the facilities that would be provided So- 
viet participants in a joint verification 
experiment. They were also shown the 
work areas, offices, and vehicles that 
would be available for their use during 
that experiment. The Soviet experts 
were provided with reports and mate- 
rial on all topics discussed during their 
visit. This information parallels the ma- 
terial received by the U.S. experts dur- 
ing their visit to Semipalatinsk. 

These reciprocal visits have consid- 
erably increased each side's under- 
standing of the practical problems 
connected with the conduct of a joint 
verification experiment. At the same 
time, the visits have provided the infor- 
mation needed for the two sides to 
start work on the design of such an 
experiment immediately after negotia- 
tions resume in Geneva in mid- 
February. 

Just as with the visit of the U.S. 
experts to the Soviet Union, the visit 
of the Soviet experts to Nevada was 
conducted in the constructive and coop- 
erative atmosphere established by both 
sides since the start of these negotia- 
tions in Geneva last November. 



'Released in Las Vegas, Nevada. 



)ril 1988 



51 



EAST ASIA 



U.S.-ASEAN Dialogue 
Held in Washington 



Representatives of the Association 
of South East Asian Nations (ASEAN) 
and the United States held their eighth 
dialogue in Washington February 10-11, 
1988. 

Following are remarks by Secre- 
tary Shultz and ASEAN spokesman 
Minister of State for Foreign Affairs 
Yeo Cheow Tong (Singapore) at the 
opening session and the text of the joint 
statement issued at the conclusion of 
the dialogue. 



OPENING REMARKS, 
FEB. 10, 19881 

Secretary Shultz 

I'm very happy to be able to welcome 
you all to Washington. This is the sec- 
ond time I have had the pleasure of 
opening one of our dialogue sessions 
during my tenure as Secretary of State, 
and, of course, I have attended all of 
the dialogue partner sessions since I 
have been Secretary of State. 

The last time we met here, during 
the sixth dialogue in April 1985, we 
were able to share with you the pleas- 
ure of springtime in Washington. Con- 
vening here in February, perhaps the 
most daunting time of year in these 
parts, is a true test of our resolve and a 
measure of the value we all place on the 
dialogue. 

This is the fourth dialogue we have 
held since Allen Wallis [Under Secre- 
tary of State for Economic Affairs and 
Agriculture] and I assumed our posi- 
tions. So this is an appropriate moment 
for me to remark on the satisfaction I 
have derived from my long association 
with ASEAN, which goes way back, 
counting both my public service in this 
Administration and my earlier years of 
private activity in your region. Some of 
the most gratifying memories I will 
take with me from the post I am now in 
will center on our dialogue with your 
vital regional organization. 

As I have said before, I believe 
ASEAN's evolution over its first two 
decades has set an example for the 
world. As a matter of fact, in many of 
my conversations with people in other 
regions — only yesterday, meeting with 
Prince Sa'ud of Saudi Arabia, and talk- 
ing about the Gulf Cooperation Council 



(GCC) as an organization that is taking 
shape and form — I have said, "You 
ought to go talk to ASEAN and see 
what you can learn." 

You have demonstrated that the 
challenges of economic development can 
best be met by a mix of policies that 
emphasize the dynamic character of 
market forces and minimize the drag of 
state intervention. You have also shown 
that regional cooperation can be a 
means by which states can enhance 
their role on the world stage, but with- 
out doing so at the expense of their 
neighbors. That is an especially wel- 
come counter to the conflict and tur- 
moil we see in many other regions 
today. 

Let me congratulate you once again 
on the success of the third ASEAN 
summit, which marked the start of 
ASEAN's third decade, by reaffirming 
the commitment of your governments to 
the organization's future and to the pro- 
gressive deepening of economic cooper- 
ation among your countries. The 
agreements announced in Manila 
clearly mark a continuation of 
ASEAN's commitment to careful efforts 
to keep moving forward in a realistic 
way toward greater liberalization of 
trading arrangements and toward giv- 
ing market forces greater leeway to 
drive the growth of your economies. 

Your third summit also under- 
scored the vital role ASEAN has come 
to play as an instrument of political sta- 
bility in your region. By persevering 
and holding the summit in Manila in the 
face of recurrent threats, ASEAN gave 
a welcome boost to President Aquino's 
efforts to build a solid democracy in the 
Philippines. I might say, it was quite 
notable that the ASEAN summit went 
off without incident. It was handled 
beautifully — no problems. 

I am also pleased to note that 
ASEAN's firmness in maintaining dip- 
lomatic pressure on the Vietnamese led 
to a record level of support for your 
Cambodian resolution in the last UN 
General Assembly. More recently, 
Prince Sihanouk and People's Republic 
of Kampuchea Prime Minister Hun Sen 
have held direct talks, the first such 
direct encounters between the opposing 
Khmer factions. As we watch to see 
how this situation develops, it will be 
important to maintain economic and po- 
Htical pressures on Hanoi. Keep the 
pressure on. 



d 



I also want to commend the 
ASEAN nations for the constructive 
and generous role they have played ii 
the continuing refugee crisis in SoutI 
east Asia. Your governments have 
granted first asylum to hundreds of 
thousands of refugees from Vietnam, 
Laos, and Cambodia over the past 13 
years. The world applauds the ongoii 
efforts you have undertaken to deal 
with the continuing flow generated b 
the unfortunate policies of Vietnames 
authorities. We urge you to continue 
those humane policies, despite the fr 
tration and impatience many of your 
people undoubtedly feel. As civilized 
nations, we cannot shun the burden i 
condone actions that result in the los 
of innocent human life. For our part, 
you can be assured that the U.S. cor 
mitment to resettle Southeast Asian 
refugees and to provide needed hum; 
itarian assistance remains as firm as 
ever. We will stand with you, for as 
long as is necessary. 

I am also happy to see that your 
economies and our trading relations i 
gained some vigor in 1987, after paus 
ing in 1985 and 1986. Our total trade 
rose some 14% last year and probabl; 
set a new record of just over $27 bil- 
lion. On this basis, ASEAN, as a 
group, ranks as our seventh largest 
trading partner. Nearly two-thirds ol 
last year's increase in our two-way 
trade was attributable to the reboun( 
in our imports from ASEAN. This re 
fleeted both your success in diversify 
ing your economies and our Presiden 
success in keeping our market the mi 
open to imports among the industri- 
alized countries. 

We must press ahead in our cam- 
paign against protectionist folly this 
year, and we will have to work togeth 
to that end. I believe 1988 will see co 
tinued growth in the United States, 1 
by record-setting increases in our me 
chandise exports. Aided by dollar de- 
preciation, these rose in value by 
nearly 12% last year, confirming our i 
timism about America's basic com- 
petitive strength. Despite price 
increases, the value of our imports w; 
rise in 1988 by substantially less than 
will that of our exports. Our trade d( 
cit will come down; there is a debate 
about how rapidly. Some think nothii 
happens fast. Others of us — like me- 
think that at some point, it may happ 



lii 



52 



Department of State Bulle 



EAST ASIA 



re rapidly than the sort of statistical 
jections tend to assume. Because 
absolute value of U.S. exports is 
V substantially less than the value of 
imports, exports must increase 
ch more in percentage terms to re- 
;e the trade deficit. We would much 
her have it that way than have it the 
ler way, where what you see is a 
je decline in imports. 

As the trade deficit decHnes, all of 
must do our part to ensure con- 
ued growth and strengthened trad- 
opportunities for all nations. The 
ure holds unprecedented economic 
joortunities for open societies like 
*s, if we meet today's challenges suc- 
;sfully. The technological and infor- 
tion revolutions now underway are 
king our economies more closely and 
.nsforming the global economy. I 
ow we have talked about that on 
ler occasions, and I spoke about it — 
ed to speak in a careful and system- 
c way — last December on the 
jader implications of these changes 
d what is taking place around the 
rid. 

We must all adopt trade and other 
jnomic pohcies which promote mar- 
t forces today so that we can realize 
i bright promise of tomorrow. 

In the area of trade, I can assure 
u that the President is determined to 
^ep on resisting protectionism. He re- 
ains committed to veto the omnibus 
ade bill if it is sent to him by the 
ingress still containing unacceptably 
strictive measures such as the 
sphardt amendment. Iowa hasn't had 
ly impact on the President's thinking 
)out that amendment, and it won't, 
e are not prepared to accept such re- 
rictive provisions as the price for ob- 
dning renewed negotiating authority 
r the GATT [General Agreement on 
iriffs and Trade] talks. The President 
ill also veto the protectionist textile 
gislation that came out of the House 
' Representatives, should it be passed 
y the Congress. And I might say that 
e did a little better in our vote this 
me than last time, so that our abihty 
) sustain a veto looks pretty good. 
A crucial element in our battle 
gainst trade restrictions, of course, is 
nr continuing work to reform and re- 
italize the GATT system. We welcome 
.SEAN'S contribution to the start of 
le Uruguay Round and to work car- 
ed out in the first phase of the nego- 
ations. We are likeminded with you, 
nd so we were able to work together 
'ell. This year we hope to begin to 
lake substantive headway in a number 



of fields of interest to you and to us, 
leading up to the ministerial midterm 
review toward the end of the year Let 
me urge you to keep up your active 
participation in the new round so that 
together we can reach agreement on 
enduring solutions to the problems that 
have come to plague the trading system 
in recent years. 

With that, I will wash you good 
luck for your dehberations over the 
next 2 days. This will mark another 
step in the maturing of our dialogue 
process. You all know Allen Wallis, my 
own mentor in economics — let alone 
statistics — and a man who brings an 
uncommonly long perspective to consid- 
eration of the economic and trade ques- 
tions before us. Thank you very much, 
and let us hope the winds and weather 
will be favorable. 

Minister Yeo Cheow Tong 

On behalf of my ASEAN colleagues, 
allow me to express our pleasure at be- 
ing in Washington to attend the eighth 
ASEAN-U.S. dialogue. We are grateful 
to our hosts for the very excellent ar- 
rangements which they have made for 
this meeting. I am confident that this 
dialogue will be a success. 

ASEAN-U.S. trade and economic 
relations have grown 25 times between 
1967 and 1986. The United States is 
now ASEAN's second largest trading 
partner. U.S. investments in ASEAN 
have also increased by almost 13 times 
between 1966 and 1986. There is great 
potential for further expansion of two- 
way trade and investments. 

With regard to investments, the 
improved ASEAN industrial joint ven- 
tures scheme is a promising vehicle for 
promoting industrial joint venture op- 
portunities among ASEAN investors 
and between ASEAN and non-ASEAN 
investors. 

The ASEAN-U.S. dialogue is an 
important component of ASEAN's ex- 
ternal relations. ASEAN and the 
United States share a broad range of 
common values, perceptions, and aspi- 
rations, and both have expressed a 
common desire in working toward a 
mutually beneficial long-term trade and 
economic relationship. Both are be- 
hevers in free and fair trade, as showTi 
by our common commitment to the suc- 
cessful conclusion of the Uruguay 
Round, which aims at expanding world 
trade and strengthening the interna- 
tional trading system. 

On ASEAN's part, it agreed at the 
Manila summit, which took place less 
than 2 months ago, to implement an 
immediate standstill and negotiate the 
rollback of nontariff barriers. 



In the area of development cooper- 
ation, ASEAN appreciates the contri- 
butions made by the United States. 
ASEAN looks forward to working with 
the United States to develop new direc- 
tions for development cooperation as 
outlined by the Manila summit. The 
United States could help ASEAN to 
widen or further strengthen the areas 
of development cooperation between the 
two partners. 

'The good relations between 
ASEAN and the United States have de- 
veloped out of the conviction on both 
sides that predictability, stability, and a 
sense of commitment in bilateral rela- 
tions are important. In short, the rela- 
tionship was premised on mutual good 
faith. Some recent developments, how- 
ever, have shaken ASEAN's confidence 
in these premises. 

A good example is the decision of 
the U.S. Administration to graduate 
Singapore from the U.S. generalized 
system of preferences (GSP) program. 
After bilateral consulations with the 
United States, Singapore enacted 
copyright legislation in April 1987, 
which took into account major U.S. 
concerns on copyright protection on the 
understanding that Singapore will be 
granted a favorable GSP package in re- 
turn. In July 1987, the United States 
implemented a favorable GSP package 
for Singapore. Six months later the 
United States announced that, with ef- 
fect from 2 January 1989, Singapore 
will be graduated from the U.S. GSP 
This unilateral action by the United 
States is contrary to the understanding 
reached between the United States and 
Singapore. The U.S. Government had 
been officially informed in a memoran- 
dum from Singapore in October 1987 
that withdrawal of GSP benefits to 
Singapore will lead to a serious reap- 
praisal by the Government of Singapore 
of its commitments to the United 
States during the U.S. GSP general 
review. 

Singapore feels in particular that 
by this decision, the United States has 
undermined the premises of good faith 
on which relations between states are 
based. Its action has cast doubts on 
U.S. credibility and reliabihty. This 
U.S. action is detrimental to the long- 
term relations between ASEAN and 
the United States. 

By the same token, while the U.S. 
Administration remains publicly com- 
mitted to the principle of free trade, 
the possibility of domestic pressure 
leading to protectionist legislation be- 
ing adopted in the United States cannot 
be discounted. The affected ASEAN 



pril 1988 



53 



EAST ASIA 



countries will recall the calls for bar- 
riers, both tariff and nontariff, to be 
raised against such imports as tropical 
vegetable oils, rice, textiles, sugar, and 
sugar-containing articles into the 
United States. At present Congress has 
before it at least another two poten- 
tially damaging pieces of protectionist 
U.S. trade legislation, namely, the om- 
nibus trade bills and the te.\tile bills. 
These, if passed in their present forms, 
would severely damage ASEAN-U.S. 
trade and economic relations. 

While ASEAN understands the po- 
htical and economic imperatives for the 
United States to reduce its huge trade 
deficit, ASEAN feels strongly and be- 
lieves strongly that protectionist trade 
legislation could only exacerbate U.S. 
trade problems by concealing the real 
sources of U.S. lack of competitiveness 
in exports. However, I'm quite encour- 
aged by the Secretary's statement that 
the way to solve this problem is to in- 
crease U.S. exports — that you believe 
that the statistics may not be totally 
correct in terms of projections, that 
there could be a big increase in exports 
in the near future, and that the way to 
go is not to reduce imports. 

However, if ASEAN's ability to ex- 
port is curtailed, its import capacity 
will also be reduced. If other developed 
countries follow the U.S. example, the 
problems will be multiplied and magni- 
fied to result in a global recession. 

It might seem, from my preceding 
remarks, that we are confronted by a 
morass of problems in ASEAN-U.S. re- 
lations, both real and potential. Nev- 
ertheless, I am encouraged by the 
ongoing consultations between ASEAN 
and the United States aimed at con- 
cluding an agreement on an ASEAN- 
U.S. Initiative, or AUI for short. This 
could provide a way out of the uncer- 
tainty that dogs bilateral relations and 
serve as the basis on which to develop a 
more stable ASEAN-U.S. trade and 
economic relationship. 

Since the ASEAN-U.S. post- 
ministerial conference in July last year, 
the AUI proposal has moved forward 
with the appointment of AUI coordi- 
nators for ASEAN and the United 
States to pursue discussions on this ini- 
tiative. Agreement has now been 
reached between the AUI coordinators 
of ASEAN and the United States on 
starting a joint study on ASEAN-U.S. 
economic relations, which will help us 
to define possible approaches in ex- 
panding and extending the ASEAN- 
U.S. economic relationship. The coordi- 
nators of the two sides also agreed on 
the terms of reference, funding, and 



54 



the appointment of consultants for such 
a study. We look forward to the imple- 
mentation of their recommendations 
and the conclusion of the study by the 
end of this year. 

The launching of the AUI could 
constitute a new phase in our mutual 
efforts to expand ASEAN-U.S. trade 
and economic relations that will further 
improve the standard of living of our 
peoples and facilitate the reduction of 
bilateral trade frictions between 
ASEAN and the United States. It 
would also be consonant with the nego- 
tiation of a series of bilateral trade 
agreements between the United States 
and the Caribbean countries, Israel, 
Canada, and Mexico. 

On behalf of my ASEAN col- 
leagues, I thank Your Excellencies for 
the warm greetings and hospitality ex- 
tended to us. My colleagues and I look 
forward to a constructive and friendly 
dialogue. 

Secretary Shultz 

Before I leave, I feel I must respond to 
your comment that you consider the 
United States to be untrustworthy and 
unreliable. I don't accept that at all. 

In the first place, your country is 
well-served to pay attention to intellec- 
tual property rights. In the kind of 
world we are moving — that we have to- 
day, let alone we are moving toward — 
knowledge and intellectual property 
will be a very strong part of the total 
picture, and countries that are unwill- 
ing to make provision for that will be 
the losers. In working with you on that 
question, of course, we were arguing on 
behalf of concerned U.S. companies. 
But I don't think that you did us any 
favor by doing that — you did yourself a 
favor, and we did you a favor, by push- 
ing at it hard. 

Now as far as GSP is concerned, 
the purpose of that program is to help 
the countries which are having a hard 
time — particularly with their nontradi- 
tional exports — to get going. Therefore, 
it makes perfect sense to take countries 
that have gotten going off the list. And 
certainly Singapore, Hong Kong, Tai- 
wan, and Korea have gotten going, in a 
big way, and we're all for it. We sit and 
cheer. 

However, the longer these special 
privileges — they aren't your rights, 
they're your privileges in our market; 
it's not your market, it's our market — 
the more those privileges are extended 
to people who don't need them, the less 
they mean to those who do need them. 
So we have had to struggle with this, 
and we have had many conversations 



with your government. Nothing was feA? 
done that totally surprised you. Time lUl 
was given. j i,* 

All these things are difficult, just pora 
as we have a difficult job to do here ii jcy, 
fighting off protection. You just try jiiiif 
going before a congressional committe tlf 
and saying, "We should give a special! iChi 
break to Singapore, because that pooB |li 
struggling country hasn't figured out j.^ 
how to export," and see how you're p 
treated. You can't make that case 

I don't mind a good argument, anjr* 
I'm putting it here. But to have the n^ 
of that argument be that your countrj 
considers my country to be untrustwc 
thy and unreliable is, I think, going 
further than I would like to go, becau 
I think the United States tries to plaj 
by the rules. 

As I said in my remarks, with all 
of our problems, we are the most opei' (i{ 
of the industrialized economies. Our n 
market has been taking the bulk of thi|EA 
manufactured exports, and our trade 
deficit, for which we are criticized coit 
stantly and which I believe will shrink lo| 
has been the basis on which other cou( h 
tries, including those of ASEAN, hav«|Eii 
been able to have export surpluses. 
When our trade deficit goes away — y( 
have to remember there is a sort of 
double-entry bookkeeping here, and i 
all of you are going to have export sui 
pluses, there's got to be somebody wi 
a deficit, and I don't know who it's 
going to be. 

I welcome your statement. But I 
don't welcome the accusation that the 
United States is unreliable and untru; 
worthy. If that's what you believe, 
there's very little basis for a genuine 
dialogue. 



JOINT STATEMENT, 
FEB. 11, 1988 

The eighth meeting of the ASEAN- 
U.S. dialogue was held in Washington 
D.C., on February 10-11, 1988, in the 
Department of State. 

The U.S. delegation was led by IV* 
Allen Wallis, Under Secretary of Stat 
for Economic Affairs [and Agriculture 
Mr. William Piez, Deputy Assistant 
Secretary of State for East Asian and 
Pacific Affairs, was deputy leader of 
the U.S. delegation. Also participating 
were representatives of the Depart- 
ments of State, Treasury, Commerce, 
Agriculture, Defense, and Labor, as 
well as representatives from the Officf 
of the U.S. Trade Representative, the 



Department of State Bullet 



EAST ASIA 



i. Agency for International Develop- 
ut, the Federal Maritime Commis- 
ii, the Overseas Private Investment 
ipdration, the U.S. Information 
iMicy, and the U.S. Food and Drug 
t'liinistration. 

The ASEAN delegation was led by 
' Cheow Tong, Acting Minister for 
lilth and Minister of State for For- 
11 Affairs of Singapore. Pengiran 
lidin Bin Pengiran Haji Hashim, Di- 
(t(ir General, ASEAN Brunei 
j-ussalam; Mr Wisber Loeis, Direc- 
( General, ASEAN Indonesia; Am- 
i: .sador Dato Abdullah Zawawi Bin 
)ii Mohamed, Director General, 
liEAN Malaysia; Ambassador Fe- 
idad B. Gonzales, Assistant Secre- 
; V. Office of ASEAN Affairs and 
. ector General, ASEAN-Philippines 
. ;ional Secretariat, Department of 
eign Affairs, Philippines; and Mr 
; iwat Arthayukti, Director General, 
IE AN Thailand, headed their coun- 
ts' delegations. 

i Mr. Roderick Yong, Secretary Gen- 
1 1 of the ASEAN Secretariat; Mr. 
Izwan Dzafir, Chairman of the 
EAN Committee on Trade and Tour- 
i; Dato Ramon Navaratnam, Chair- 
n of the ASEAN Committee on 
insport and Communications; and 
to Dr. Mohamed Nor Ghani, Chair- 
n of the ASEAN Committee on 
Iture and Information, also 
•ticipated. 

The dialogue was opened by Mr 
orge P. Shultz, Secretary of State of 
! United States. In his welcoming re- 
,rks, he noted that ASEAN, during 
first two decades, had set an exam- 
' for the world through its emphasis 
regional cooperation and market-ori- 
ted development strategies. 

The Secretary congratulated 
;EAN on the success of its third 
mmit in Manila as a reaffirmation of 
3 organization's commitment to real- 
ic efforts to deepen economic cooper- 
on among its members. He observed 
at the ASEAN economies and their 
ide relations with the United States 
d strengthened in 1987 and that total 
ide between ASEAN and the United 
ates had set a new record. ASEAN 
d come to rank as the seventh largest 
iding partner of the United States, 
le Secretary assured the delegations 
at President Reagan would continue 
resist protectionist trade legislation 
ch as certain provisions of the om- 
3us trade bill and the textile legisla- 
in currently being considered by the 
S. Congress. He also noted ASEAN's 



contribution to the start of the Uru- 
g^iay Round of multilateral trade nego- 
tiations and urged the ASEAN 
governments to continue their active 
participation in the new round in order 
to reach agreement on enduring solu- 
tions to the problems of the world trad- 
ing system. 

In his opening remarks, H.E. Min- 
ister Yeo Cheow Tong noted the growth 
in ASEAN-U.S. trade and economic re- 
lations over the previous two decades. 
He noted that the ASEAN-U.S. di- 
alogue was an important component of 
ASEAN's external relations, adding 
that both sides shared a broad range of 
common values and aspirations. Among 
these was a belief in free and fair 
trade, demonstrated by a common com- 
mitment to a successful conclusion to 
the Uruguay Round of multilateral 
trade negotiations. The Minister noted 
with regret the recent decision of the 
U.S. Administration to graduate Sing- 
apore from the U.S. GSP program, in- 
dicating that this decision would be 
detrimental to long-term U.S. -ASEAN 
relations. Singapore enacted copyright 
legislation which took into account ma- 
jor U.S. concerns on copyright protec- 
tion, on the understanding that 
Singapore would be granted a favorable 
GSP package in return. The Minister 
added that ASEAN was encouraged by 
ongoing consultations concerning the 
ASEAN-U.S. Initiative (AUI). He ob- 
served that agreement had been 
reached between the AUI coordinators 
on terms of reference and other opera- 
tional details of a joint economic study 
under the AUI to define possible ap- 
proaches to extending ASEAN-U.S. 
economic relations. It was hoped that 
this study could be launched and con- 
cluded by the end of 1988 and that the 
AUI would facilitate and enhance trade 
economic relations. 

Speaking in reply, Secretary Shultz 
defended the decision to graduate Sing- 
apore and three other newly industri- 
alized economies from the GSP 
program. The Secretary noted that the 
U.S. GSP was intended to help coun- 
tries having trouble getting started as 
exporters of nontraditional products. 
Singapore and the other three benefici- 
aries involved had made great strides in 
that direction, he added, and it was 
necessary to ensure that the benefits of 
trade privileges offered through the 
GSP were available for beneficiaries ac- 
tually needing them. The Secretary 
noted that Singapore's increased intel- 
lectual property protection, agreed on 
in the context of the GSP general re- 
view, was in Singapore's own interest. 



The Secretary noted that the U.S. mar- 
ket remained the most open of the in- 
dustrialized countries, despite the 
recent rise in protectionist pressure 
caused by the persistent U.S. trade 
deficit. 

Overview of ASEAN-U.S. 
Dialogue Relations 

The two sides reviewed ASEAN-U.S. 
relations and exchanged views on a 
wide range of economic and trade is- 
sues of interest to ASEAN and the 
United States. They stressed their 
common desire to work toward a long- 
term economic relationship of mutual 
benefit. The two sides were pleased to 
note marked improvements in the di- 
alogue process since the seventh di- 
alogue. The two sides also discussed 
future direction of development cooper- 
ation and agreed that future coopera- 
tion should focus on the dominant 
theme of economic growth in ASEAN. 

The ASEAN side informed the 
meeting of the results of the third 
ASEAN summit in Manila in December 
1987. It was noted that the decisions 
taken by the ASEAN heads of govern- 
ment would provide excellent oppor- 
tunities for promotion of intra-ASEAN 
trade and investment and would also 
provide incentives for U.S. companies 
to increase trade with and investment 
in ASEAN. In response, the U.S. dele- 
gation was encouraged to note that the 
proposed measures would not result in 
trade barriers to third countries. 

Exchange of Views on International 
Economic Issues 

The two sides reviewed recent develop- 
ments and prospects concerning a wide 
range of important international eco- 
nomic issues. 

The ASEAN side stated there was 
an urgent need to restore and stabilize 
prices for internationally traded com- 
modities so as to stabilize foreign ex- 
change earnings needed to pay for 
imports and ensure future supplies to 
consumers. ASEAN observed that in- 
ternational cooperation on commodities 
was at its lowest ebb and regretted that 
major economic powers, including the 
United States, were lukewarm to global 
initiatives on commodities. ASEAN 
stressed the role of developed countries 
in assisting producers and pointed out 
that ASEAN growth depended largely 
on recovery of the commodity sector. 
ASEAN urged the United States to 
propose alternative measures to bring 
about effective, practical, and favorable 
trade in commodities. 



ril 1988 



55 



EAST ASIA 



Rubber. The ASEAN side ex- 
pressed appreciation to the United 
States for signing the International 
Natural Rubber Agreement (INRA) 
but urged the U.S. side to e.xpedite 
ratification in order to bring the agree- 
ment into force as early as possible. 
The U.S. side stated that it supported 
efforts to bring INRA II into force and 
indicated that, despite difficulties, the 
Administration expected to proceed 
with the domestic procedures required 
for ratification of INRA II. 

Tin. ASEAN urged the United 
States to take steps to keep disposals of 
the General Services Administration 
(GSA) tin stockpiles to the minimum 
level possible to avoid undue market 
disruption and to assist in the imple- 
mentation of the Association of Tin Pro- 
ducing Countries' supply rationalization 
scheme aimed at bringing the tin mar- 
ket back to normalcy. U.S. cooperation 
was also sought in establishing an in- 
ternational tin study group to handle 
certain functions of the International 
Tin Council. In addition, ASEAN called 
for a collaborative research and devel- 
opment project to develop new uses for 
tin. The U.S. side indicated that GSA 
tin disposals could not be said to cause 
market disruption. U.S. Government 
officials remained ready to consult with 
ASEAN regarding tin disposals. The 
United States planned to take part in 
the UNCTAD [UN Conference on 
Trade and Development] meeting in 
April on the proposed establishment of 
the international tin study group and 
would consider its position in light of 
that meeting. The United States also 
noted that the ASEAN research and 
development proposal would be consid- 
ered in the context of the ASEAN-U.S. 
development cooperation program. 

Tropical Vegetable Oils. ASEAN 

expressed appreciation for the strong 
stand taken by the U.S. Administration 
in opposition to the proposed tropical 
oil labeling legislation, on the ground 
that it discriminated against tropical 
vegetable oils produced in ASEAN. In 
response the U.S. side stated that the 
Administration would continue to op- 
pose this bill. The ASEAN side urged 
the United States to continue to work 
closely with ASEAN to oppose the Eu- 
ropean Economic Community Commis- 
sion's proposed levy on vegetable oils 
and fats. ASEAN also expressed con- 
cern about U.S. sales of vegetable oils 
to developing countries through the ex- 
port enhancement program and PL 480, 
which ASEAN feared would displace 
sales of nonsubsidized ASEAN oils. 



Sugar. ASEAN noted that its 
member countries exporting sugar to 
the United States were being adversely 
affected by steadily declining U.S. im- 
port quotas and indicated it sought 
larger import quotas on the basis of 
historical export performance. ASEAN 
also sought U.S. support for agreement 
to implement the economic provisions of 
the International Sugar Agreement 
(ISA). The U.S. delegation indicated 
that the Administration was committed 
to seek reform of the sugar program 
and was sympathetic to the problems it 
caused ASEAN sugar exporters. The 
United States considered the problem 
of sugar to be one of the agricultural 
questions to be addressed in the new 
GATT round through the U.S. proposal 
to eliminate subsidies and market ac- 
cess barriers. 

The ASEAN delegation expressed 
appreciation for U.S. support regarding 
the reallocation of export quotas in the 
International Coffee Agreement and re- 
quested that this support be continued. 

The ASEAN side requested the as- 
sistance of the United States on re- 
search and development to improve 
productivity and product quality and to 
find new uses and applications for cer- 
tain commodities to cope with market- 
ing requirements. ASEAN invited the 
United States to participate in invest- 
ments and technology transfers to that 
end. 

Both sides reviewed recent devel- 
opments and prospects in the Uruguay 
Round GATT negotiations, stressing 
the commonality of interest between 
ASEAN and the United States in a 
successful new round. The U.S. side in- 
dicated that agriculture was a core ele- 
ment of the new round and expressed 
the view that it should be possible to 
achieve the framework and objectives 
for a final agreement by the midterm 
review later this year. 'The U.S. side 
also indicated that progress and even 
final agreement on institutional issues, 
such as dispute settlement, the func- 
tioning of the GATT system, and tariff 
and nontariff measures, should be pos- 
sible by the midterm review. 

The ASEAN side noted that it 
would like to see early agreement on 
agriculture, tropical products, natural 
resource-based products, safeguards, 
subsidies, and dispute settlement, as 
well as a standstill on nontariff meas- 
ures and a roll-back of GATT-illegal 
actions. 

The U.S. delegation indicated that 
the U.S. commitment to seek improve- 
ments in intellectual property protec- 
tion was a worldwide effort. The 



United States appreciated the achievfl ' 
ments of the ASEAN countries in imi '.*' 
proving intellectual property protecti*'' 
and expressed the hope that such im- 
provements would continue. The Unii 
States urged the ASEAN governmeir 
to support the U.S. proposal on Intel 
lectual property in the Uruguay Rou 

The U.S. delegation urged the 
ASEAN governments to consider ac- 
ceding to the Vienna Convention on 
Protection of the Ozone Layer and it: 
Montreal protocol regulating ozone-d 
pleting chemicals. 

On the international monetary si 
ation, ASEAN called for a new work 
economic recovery plan to avert furtl 
worsening of the global situation 
brought on by low current prices for 
and other commodities. The plan sho 
incorporate both domestic structural 
reforms and external cooperation. 

In the context of its review of in 
ternational monetary and financial is * 
sues, the U.S. side replied that the 
Administration did not embrace debt 
relief plans such as the Bradley plan 
The Program for Sustained Growth ( 
Baker plan) had made progress but 
would require more time for full suc- 
cess. The U.S. side indicated it 
strongly supported a general capital 
crease at the World Bank, noted its 
proposal for an external contingency 
fund at the IMF, and stated its supp 
for a "menu" approach to debt 
management. 

Concerning ASEAN financial m; 
kets, the U.S. side emphasized the 
need for free market access for all U 
service firms, including financial in- 
stitutions, in the region. 

General Bilateral Economic 
and Trade Issues 

Each ASEAN delegation registered 
concern over the decision of the Unit 
States to graduate Singapore from tl 
U.S. GSP program. The U.S. side 
noted the presentations made by the 
ASEAN delegations, assured the 
ASEAN side that the U.S. Administ 
tion had considered their viewpoints 
carefully when dehberating the grad 
tion decision. 

The ASEAN side requested favo 
able consideration of ASEAN produc 
in eight tariff-product categories thai 
were being considered for inclusion ii 
the GSP program under the current 
nual review. The U.S. side respondet 
by noting that both product and couj 
try practices petitions affecting 
ASEAN were being reviewed, and a« 
ditional information might be require 



56 



EAST ASIA 



The ASEAN side expressed con- 
1 with the proliferation of protec- 
|iist trade bills before the U.S. 
jigress, which, if passed, would ad- 
sely affect ASEAN-U.S. trade. The 
1. delegation noted that the Admin- 
ation was working with the Con- 
ss to try to develop a responsible 
le bill and assured ASEAN that the 
sident would veto the bill unless 
re were substantial changes. The 
5. delegation also reaffirmed that the 
ninistration was strongly opposed to 

textile bill and that the President 
lid veto it if passed by the Senate. 

Both sides noted with satisfaction 
t the coordinators for the ASEAN- 
;. Initiative had at their meeting on 
truary 8 agreed to launch a joint 
dy on ASEAN-U.S. economic 
itions. 

Both sides also continued discus- 
is on the subject of the exchange of 
de data. 

vate Sector Participation 

! ASEAN and U.S. delegations met 
h a delegation from the ASEAN- 
5. Business Council (AUSBC) and 

ASEAN-U.S. Center for Tech- 
ogy Exchange. A wide-ranging dis- 
sion was held on trade and economic 
lies of concern to the U.S. and 
EAN private sectors. 

Mr. William Tucker, cochairman of 
: AUSBC, and Mr Jose Luis Yulo, 
, Secretary General of the ASEAN 
le, briefed the ASEAN and U.S. del- 
itions on the activities of the council 
1 on the council's views concerning 
ispects for ASEAN-U.S. economic 
ations. It was noted that the AUSBC 
d completed a study of U.S. -ASEAN 
momic relations, and copies were 
iide available to the delegations. The 
jmcil stated that the U.S. business 
ptor was also disappointed in the re- 
lit GSP graduation ruling. It was the 
!;w of the ASEAN private sector that 
Ivernments and the private sector 
':re working in tandem to promote 
jonomic cooperation and growth in the 
'gion. The 1987 report of the private 
|Ctor Group of 14 of the ASEAN 
lamher of Commerce and Industry 
iCCI) was cited as a blueprint for 
jivernment-business cooperation in 
Ich fields as: trade Uberalization, 
lade in commodities, transportation 
jstworks, investment, energy coopera- 
m, and strengthening the monetary 
■stem. Other AUSBC representatives 
;ade more detailed presentations re- 
iirding the private sector's concerns in 
|ich fields as trade policy, trade in 
irvices, investment regulation, and in- 



tellectual property protection. The 
ASEAN and U.S. delegations ex- 
pressed gratitude for the contribution 
made by the AUSBC to the ASEAN- 
U.S. relationship and to increasing 
awareness of ASEAN among the U.S. 
business community. 

Mr. Robert Driscoll, President of 
the U.S. -ASEAN Center for Tech- 
nology Exchange, reviewed the pro- 
grams of the center and its plans for 
the coming year He reported that the 
center had conducted 57 technical semi- 
nars and six technical missions to the 
United States, with participation by 
4,800 ASEAN and 400 U.S. business 
executives. Mr Driscoll stated that the 
center had been challenged to shift 
away from seminars to a more compre- 
hensive format. This would require con- 
centration on key industries, and the 
center would review its program in the 
coming year to determine the feasibility 
of this suggestion. The center would 
seek additional grants from the U.S. 
Agency for International Development. 

Specific Bilateral Trade Issues 

The ASEAN delegation presented its 
concerns regarding U.S. programs to 
subsidize its exports of rice and edible 
oils. ASEAN urged the United States 
to reduce its rice acreage by the maxi- 
mum amount of 35%. ASEAN urged 
the United States not to implement the 
export enhancement program, GSM 
[general sales manager] loans, or a tar- 
geted export assistance program for 
rice and to seek to amend the Farm Act 
so as to remove the rice program. 
ASEAN asked the United States to 
modify its sugar price support program 
with a view to increasing U.S. sugar 
imports. ASEAN further asked the 
U.S. Administration to exempt certain 
ASEAN sugar-containing food articles 
from the emergency quota on these 
products. The ASEAN side pointed out 
that the extensive U.S. export program 
for soybeans and soy products affected 
tropical vegetable oil production and ac- 
cess to markets where ASEAN coun- 
tries have an interest. ASEAN urged 
the United States to continue to consult 
on a timely basis concerning its export 
enhancement programs for edible oils, 
in order to allow ASEAN to plan the 
marketing of vegetable oils. Finally, 
ASEAN requested the U.S. Admin- 
istration to hft the ban on the importa- 
tion of mangoes and carageenan from 
an ASEAN country. 

The United States stated that most 
of its edible oils and virtually all meal 



and other similar products were ex- 
ported at world prices without sub- 
sidies. The export enhancement 
program was a temporary program de- 
signed to convince the European Com- 
munity to negotiate elimination of 
subsidies. The U.S. side reaffirmed its 
intention to seek legislation to reform 
the sugar program, but no effort was 
contemplated to seek an exemption for 
items exceeding the 10% limit for sugar 
content. On rice, the U.S. side re- 
affirmed that the rice marketing loan 
program is not designed to take mar- 
kets from nonsubsidizing exporters. 
The rice acreage set-aside for 1988 had 
been set at a realistic 25%. Regarding 
mangoes, the U.S. delegation stated 
that the U.S. Agricultural Plant Health 
Inspection Service (APHIS), an arm of 
the Agriculture Department, was ex- 
amining the problem of pest infestation 
and would have a decision soon. 

ASEAN noted the U.S. Admin- 
istration's explanation that antidumping 
and countervailing duty cases were in- 
dustry-initiated and not under its con- 
trol. ASEAN also felt that the use of 
these actions was contrary to the U.S. 
Uruguay Round commitment on non- 
tariff barriers and constituted harass- 
ment of ASEAN trade. The U.S. 
delegation responded that the U.S. 
Commerce Department was legally 
accountable for antidumping and coun- 
tervaihng duty investigations. The U.S. 
side added that the Administration did 
not support measures in the omnibus 
trade bill that would encourage filing of 
more cases. 

ASEAN referred to U.S. Govern- 
ment procurement policies as discrimi- 
natory toward its high-tech industries. 
The U.S. delegation noted that the Ad- 
ministration was compelled by Con- 
gress to implement the measures 
mentioned by ASEAN. The U.S. side 
invited the concerned ASEAN mem- 
bers to consider acceding to the GATT 
procurement code. 

ASEAN countries exporting steel 
to the United States noted a desire on 
the part of U.S. interests for voluntary 
restraint agreements with ASEAN 
members. The U.S. delegation replied 
that voluntary restraint agreements 
were used to help the U.S. steel indus- 
try recover from import penetration 
but noted that the voluntary restraint 
agreement program was due to end in 
September 1989. 

The U.S. side expressed its con- 
cern regarding quantitative restrictions 
and discriminatory taxes in some 
ASEAN countries which adversely af- 
fected U.S. agricultural exports, espe- 
cially tobacco. The United States urged 



57 



EAST ASIA 



the ASEAN side to roll back trade 
measures which were inconsistent with 
the GATT. In response, the ASEAN 
delegations noted the U.S. concerns 
and added that they were being consid- 
ered primarily at the bilateral level. 

The ASEAN delegation discussed 
the Ocean Shipping Act of 1978 and the 
"Controlled Carriers Act." The U.S. 
side responded that, based on previous 
unsuccessful efforts to obtain a legisla- 
tive e.xemption from the Controlled 
Carriers Act, it did not believe the 
U.S. Congress would either ratify a 
treaty or pass any other legislation to 
exempt ASEAN carriers as a class. 
The United States informed ASEAN 
that a review of the 1984 Shipping Act 
was due in 1989 and advised ASEAN to 
present its views directly to the Con- 
gress at that time. In this regard 
ASEAN stressed the need for the U.S. 
Administration to give higher priority 
to using its good offices, especially with 
the private sector, in resolving these 
outstanding issues as the value of 
ASEAN-U.S. shipping and freight was 
$3.5 billion annually. 

Investment Cooperation 

ASEAN and the United States agreed 
that private foreign investment had an 
important role to play in ASEAN's de- 
velopment. ASEAN informed the U.S. 
side of the steps being taken to improve 
the investment climate in the region, 
particularly the improvements ageed to 
at the third ASEAN summit with re- 
spect to the ASEAN industrial joint 
ventures scheme. The ASEAN side 
urged the United States to consider 
providing assistance in the following 
areas: (a) identifying investment proj- 
ects of interest to both ASEAN and 
U.S. investors; (b) mounting invest- 
ment missions and industrial confer- 
ences to increase U.S. business 
awareness of opportunities in ASEAN; 
and (c) organizing a workshop involving 
U.S. and ASEAN officials and the U.S. 
private sector to increase understand- 
ing concerning business conditions and 
expectations in ASEAN. The U.S. side 
affirmed that both sides agreed that 
private foreign investment had an 
important role to play in ASEAN's de- 
velopment. The United States believed 
the best way to attract foreign invest- 
ment was by removing barriers rather 
than by providing investment incen- 
tives. The U.S. side also urged the 
ASEAN governments to support the 
U.S. proposal in the GATT new round 
concerning the elimination of invest- 
ment measures which distort or impede 
trade flows. 



58 



Development Cooperation 

The two sides reviewed with satisfac- 
tion the progress made in development 
cooperation and agreed that new areas 
should be identified in the context of a 
medium- and long-term economic coop- 
eration program. 



Date and Venue of the Next Meetin; f 

Both sides agreed that the ninth di 
alogue would be held in Thailand. Bot 
sides agreed that the date and specifi 
venue would be determined subse- 
quently though diplomatic channels, 



'Press release 16. 



U.S.-Japanese Relations in Focus 



by William Clark, Jr. 

Address before the University of 
Georgia Alumni Society's seminar on 
Japan in Athens on February 12, 1988. 
Mr. Clark is Deputy Assistant Secre- 
tary for East Asian and Pacific 
Affairs. 

Dr. Sigur [Gaston J. Sigur, Jr. , As- 
sistant Secretary for East Asian and 
Pacific Affairs] is sorry he could not be 
with you, but I am delighted to be here 
today on his behalf to speak to you 
about our most important bilateral rela- 
tionship: that between the United 
States and Japan. For two nations to be 
so closely intertwined as the United 
States and Japan today, despite dis- 
similar histories and a bitter war still 
within memory, is unprecedented. It is 
difficult to understand how we could 
have forged, during the period follow- 
ing World War II, such a remarkably 
durable alliance. 

We have built this alliance over 
40 years upon shared values and exten- 
sive mutual interests and on those 
things we need from each other. Our 
relationship is now deep and multidi- 
mensional. And it is important that we 
keep the many dimensions in mind as 
we confront difficult individual issues. 
For while the United States and Japan 
continue to be close partners, both in 
the economic arena and in terms of in- 
ternational political and security coop- 
eration, it is also true that headlines 
about our relations these days more of- 
ten than not highlight trade frictions 
between the two nations. Someone once 
said good news is no news. Still I would 
like to accentuate the positive, without 
overlooking the sore points, to bring 
our relationship with Japan into better 
focus. 

Japan's extraordinary economic as- 
cendance and our own trade and budget 
deficits have led many to see Japan as a 
hostile economic competitor and the 
United States as in danger of losing its 



preeminence as the economic and pel 
cal leader of the free world. This vie^ 
overlooks the many benefits our rela 
tionship with Japan brings to us and 
strays from the traditional American 
spirit of competition. We Americans 
competitors. We believe competition- 
open and fair competition — makes ui 
excel. That philosophy is the basis 
our policy toward Japan. We are de 
mined to bring our trade with Japan 
into a more balanced equilibrium, to 
promote our own economic interests, 
and to maintain our strong political i 
security relationship. 

Japan's selection of a new prime 
minister last November and his visit 
Washington this January provided th 
opportunity for a fresh look at our b 
lateral relationship. Ambassador [to 
Japan] Mike Mansfield has called it t 
most important bilateral relationship 
the world, bar none. During his Jam 
ary visit to Washington, Prime Minii 
'Kikeshita, a most experienced and c 
pable political leader, reaffirmed his 
view that Japan's relations with the 
United States are the cornerstone oi 
Japan's foreign policy. President Rea 
emphasized Japan's role as America's 
most important partner and ally in t 
Pacific. Let me touch on the reasons 
why the United States and Japan 
should view each other as close allie; 
as well as tough competitors. 

Economic Ties 

At about $115 billion last year, two-v 
trade between our countries is large 
than the gross national product of m 
nations. The United States is Japan's 
number one export market, absorbir 
36% of Japan's exports, and Japan is 
our number one supplier. In return 
Japan receives about 11% of U.S. ex 
ports, including $6.8 billion in 
foodstuffs last year, making Japan b; 
far the U.S. farmer's best customer, 
fact Japan bought more goods from 1 
United States than did West Germai 



Department of State Bull il9i 



EAST ASIA 



Ki , and Italy combined. We esti- 

' tliat the $27.5 billion in goods 
! 11 lidught from us last year sus- 

■il over 700,000 American jobs. 

W it bin Japan we are the number 
i(f()i-fign investor at $11 billion. 
rrican firms such as IBM, Xerox, 
ii Schick hold significant market posi- 
es in Japan. Affiliates of U.S. multi- 
ai^nals had $80 billion in sales, 
rijrted $3 billion in goods from the 
i.ed States, and had $2 billion in net 
icme in Japan in 1985. And right from 
frgia, the Coca Cola Company took 
1 stimated 60% share of the Japanese 
I drink market that year. 

In the United States, Japanese di- 
!i investment is rising dramatically, 
tough Japan is only the number 
I e foreign investor behind the 
:;ed Kingdom and the Netherlands, 
ii $24 billion in direct investments. 
1 985 Japanese firms employed 
I 000 Americans and exported $23 
J on in goods. Since then, to use the 
1) industry as an important example, 
U of the major Japanese companies 
I built plants here, bought more 
.-made parts, and begun imple- 
iting plans to export cars back to 
m. 

In 1986 we estimate that Japanese 
!stors put $65 billion into U.S. 
ley markets. Interest on our budget 
cit would increase if Japanese funds 
not flow in. The United States is 
Japanese investment country of 
ice. In 1987 Japans net overseas in- 
tment increased to an astounding 
il of $137 billion. Japan exports more 
ital overseas in global investments 
n it earns from its current account 
plus. 
Since 1981 our trade imbalance 
h Japan has tripled, from $18 billion 
m billion. The U.S. global trade 
icit quadrupled from $40 billion to 
ut $170 billion over the same period, 
ire are barriers to U.S. exports in 
an, and these must be dismantled. 
; the imbalance with Japan is a 
iptom of broader macroeconomic 
:es. We have a global trade im- 
ince problem, as well as a bilateral 

We have worked hard with Japan to 
uce these external imbalances — 
an's surplus and the U.S. deficit — 
le maintaining non-inflationary 
wth. The most visible aspect of this 
peration has been the appreciation 
he yen from 265 to 130 per dollar 
:e 1985. This has helped boost U.S. 
orts and helped U.S. firms vrin mar- 
share in Japan and at home. 



At the same time, new purchases 
of foreign assets became economical for 
Japanese overseas investors. When con- 
verted to dollars at the new rate, 
Japan's per capita GNP now exceeds 
our own. Foreign travel and imported 
goods are great bargains now for most 
Japanese. And the physical volume of 
Japan's exports has declined along with 
the yen value of those exports. Growth 
now comes from Japan's domestic econ- 
omy, not exports. 

Japan's global current account sur- 
plus, which was $87 billion in 1987, and 
our bilateral trade imbalance are pro- 
jected to decline this year. Japan is 
shifting from export-led to domestic-led 
growth policies to aid the reduction fur- 
ther. Japan had negative net external 
growth in 1987 and strong domestic ex- 
pansion and is expected to have 3.7% 
real GNP growth in the fiscal year 
which ends in March. 

Already, by taking measures to 
spur private consumption, housing in- 
vestment, and public works, the Jap- 
anese Government has reduced reliance 
on export-led growth. An influential 
study, the Maekawa report issued in 
April 1986, contains a blueprint for al- 
leviating the Japanese surplus and put- 
ting Japan on course for economic 
growth in harmony with the needs of 
its economic partners. It has been em- 
braced by Japan's business leadership 
and supported by Prime Minister Take- 
shita, but only partially implemented. 
We encourage Japan to follow through 
on its recommendations. 

In sum, our economic pohcy toward 
Japan has as its central goal the expan- 
sion of trade, not the limiting of it. We 
seek removal of individual trade bar- 
riers. We encourage appropriate struc- 
tural and macroeconomic reforms in 
Japan. And we seek to cooperate with 
Japan in promoting the success of the 
new GATT [General Agreement on Tar- 
iffs and Trade] trade round, where we 
both aim to establish new rules for 
trade in agriculture, services, and intel- 
lectual property. 

Security Ties 

Since 1952 when the U.S. -Japan peace 
treaty went into effect, Japan has be- 
come a valued U.S. ally and a staunch 
member of the Western community. The 
bilateral arrangements established un- 
der the 1960 Treaty of Mutual Coopera- 
tion and Security have been crucial to 
peace and stability in East Asia. That 
treaty, spelling out our security rela- 
tionship with Japan, is the cornerstone 
of U.S. security policy in the Pacific. 



Japan's 1947 constitution precludes 
the projection of force abroad or an as- 
sertive military role in international re- 
lations. But Japanese perceptions of its 
security requirements have been made 
acute by Soviet intransigence on ter- 
ritorial issues, by the relentless Soviet 
mihtary buildup in the Pacific, and by 
Moscow's aggression in Afghanistan and 
its support for Vietnam's invasion of 
Cambodia. A consensus has emerged in 
Japan which supports steady improve- 
ments in Japan's self-defense ca- 
pabilities and expanded bilateral 
defense cooperation with the United 
States. 

Our defense cooperation with Japan 
has never been better. Japan hosts 
some 60,000 U.S. troops and supports 
7th Fleet ship visits and homeporting, 
including the only U.S. aircraft carrier 
battle group based overseas. Japan con- 
tributes $2.5 billion annually in "host- 
nation" support for U.S. Forces Japan. 
At over $40,000 per U.S. troop, that is 
the most generous "host-nation" sup- 
port arrangement we have anywhere in 
the world. U.S. bases and facilities in 
Japan enable us to maintain regional 
defense capabilities, thus serving both 
U.S. and mutual security 
interests. We maintain these bases be- 
cause it is in our own self-interest, our 
own self-defense, to do so. 

The United States and Japan en- 
gage in extensive joint planning and ex- 
ercises. Japan is participating in 
President Reagan's Strategic Defense 
Initiative (SDI), and transfers of impor- 
tant military technology from Japan to 
the United States are on the rise. 

Just as Japan's "host-nation" sup- 
port of U.S. forces and U.S. -Japan de- 
fense cooperation have increased, so 
has Japan's own self-defense efforts. 
Japan has undertaken to defend its ter- 
ritorial homeland, skies, and sealanes 
out to 1,000 nautical miles, providing a 
credible deterrent to Soviet adven- 
turism in Northeast Asia. This allows 
flexibility for U.S. forces in case of 
emergencies in the Southwest Pacific 
and Indian Oceans. None of our forces 
in Japan is tied to the direct defense of 
Japan. Their role is regional. 

These defense roles are consistent 
vdth Japanese and American expecta- 
tions. They are in keeping with the 
views of Japan's neighbors which still 
remain sensitive to past militarism. 
Japanese defense spending rose 5.4% a 
year in real terms over the last 10 
years. For FY 1988, the Japanese de- 
fense budget is $30 billion, fifth largest 
in the world and second largest of any 
non-nuclear power. 



il 1988 



59 



EAST ASIA 



Mutual Need and Common Values 

A book on U.S.-Japan relations just 
published by the Council on Foreign 
Relations is titled For Richer, For 
Poorer, and I want to borrow the meta- 
phor of marriage it uses to characterize 
the U.S.-Japan relationship. Despite 
the competitive frictions in our part- 
nership, we can profit more together 
than apart. 

In many of our industries most af- 
fected by Japanese competition, such as 
electronics or autos, calls for barriers 
or "tough action" on trade cause us to 
overlook quietly successful U.S. -Jap- 
anese joint operations. All the U.S. 
auto companies have cross-invested and 
cross-marketed with their Japanese 
competitors. Electronics giants such as 
IBM, Motorola, Texas Instruments, and 
others have joint ventures, wholly 
owned subsidiaries, or both in Japan. 
More and more, as interrelationships 
grow to maturity among U.S. and Jap- 
anese companies, consumers will bene- 
fit and trade will grow. 

In Japan today, the younger gener- 
ation, raised in relative affluence, 
seems to be shifting to greater consum- 
erism. The Japanese Government can 
help this trend and help U.S. products 
by removing structural inefficiencies, 
such as those in agriculture and dis- 
tribution, which limit sales of foreign 
products most. 

In contrast, Japan-Soviet relations 
are not close. The Soviets, since World 
War II, have occupied and militarized 
four Japanese islands known as the 
Northern Territories. Japan joined 
world condemnation of the Soviet inva- 
sion of Afghanistan and the occupation 
of Cambodia by Moscow's clients in 
Hanoi. It has helped provide UN refu- 
gee relief for the victims of these cruel 
tragedies. Following the Toshiba Ma- 
chine Company affair, the Japanese 
Government and Japanese firms have 
become increasingly wary of Soviet in- 
terest in high technology. 

In a fundamental sense, our mutual 
security and the security our alliance 
with Japan provides other friends and 
allies in the Pacific is as strong as it 
has ever been. At its core, it is sus- 
tained by beliefs both partners cherish 
dearly. A common faith in democracy, 
human rights, and free enterprise has 
permitted two great nations to remain 
competitors and friends for over three 
decades. 

It is interesting to note that in re- 
cent years, the level and frequency of 
the U.S.-Japan bilateral dialogue has 
changed dramatically. Starting with 



60 



V 



Gerald Ford, all our Presidents have 
visited Japan while in office. President 
Reagan did so in 1983 and again in 1986 
for the Tokyo [economic] summit. Dur- 
ing former Foreign Minister Abe's 4- 
year tenure, he and Secretary Shultz 
met almost 30 times. Subcabinet level 
meetings seem to be in almost constant 
session; all signs of a strong rela- 
tionship with a key ally. 

Despite its own self-image, Japan is 
not, and never has been, a poor island 
nation without natural resources. 
Japan's vibrant culture and industrious 
people have insured its strength and 
prosperity. Its modern combination of 
great financial power, cutting-edge 
technology, and strong international 
companies makes Japan a force to be 
taken seriously. It can make Japan a 
force for peace and progress, much as 
the United States has been in the post- 
war era. 

Japan's leadership realizes that it 
must take actions to preserve the free 
market trading system, if for no other 
reason than to keep from being isolated 
in an increasingly trade-conscious 
world. But we need Japan to do more 
and have urged Japan to assume a 
global political role commensurate with 
its status as a world economic super- 
power. The Japanese leadership has 
sought to do that in numerous ways 
that support our shared foreign policy 
goals. 

Japan has contributed to decision- 
making on U.S. arms control initia- 
tives, including the U.S.-U.S.S.R. 
agreement on intermediate-range nu- 
clear forces. In the Persian Gulf, where 
the U.S. fleet is protecting U.S. flag 
ships sailing to Japan and elsewhere 
with energy cargoes, Japan has taken 
steps to increase aid flows to Oman and 
Jordan and to install a precise naviga- 
tional aid system with a $10 million 
price tag for the benefit of commercial 
mariners from all nations. 

In the Philippines, Japanese aid 
flows have increased enormously since 
the Aquino government took the stage, 
amounting to over $600 million in JFY 
1987. Prime Minister Takeshita made 
his first overseas trip a visit to Manila 
for an Association of South East Asian 
Nations (ASEAN) conference last 
December 

In fact Japan is the world's second 
largest donor of foreign aid after the 
United States. Together we provide 
about 45% of all economic assistance to 
developing nations. It is in this area 
that we are at work to map out con- 
structive, mutually reinforcing strat- 
egies to benefit nations in need of 
growth and nourishment. Japan is the 



leading donor of economic aid to Chi 
and provides Korea with economic at 
sistance as well. Tokyo gives aid to 
Egypt, Turkey, and Pakistan, nation 
strategic importance to the West. In 
short Japan has taken significant ste 
to play a larger role in the field of ai 
and this has greatly benefitted stabi 
and development in areas of vital int 
est to us both. 

Structural changes in its econon 
can provide an even more important 
portunity for Japanese cooperation. ^'- ■ 
Japan can accelerate imports of low ,' '[' ' 
middle technology products, particu- '" 
larly from the developing world, it c '-"* 
offer a new opportunity for global e( ^'f' 
nomic growth which has been provid f 
by the United States in the past. Th 
are signs that this is happening. Jap ' 
anese firms are erecting new factori< ' 
in ASEAN countries, the United ''i 
States, and Europe, but they have y !*' 
to export homeward as U.S. multim i^' 
tionals have. 

We must continue to consult on 
ternational security, trade, and inve 
ment issues and encourage Japan to 
expand and deepen its role in the gl 
economic institutions: the United N. 
tions, the World Bank, the Interna- 
tional Monetary Fund, the General 
Agreement on Tariffs and Trade, th 
Organization for Economic Cooperat 
and Development, and the internati( 
development banks. Trade is only oi 
of several economic imbalances facin 
the United States, Japan, and the n 
of the world. The Third World debt 
crisis threatens the international ba 
ing system. There is a glut of agri- 
cultural production worldwide, mucl 
it caused by too much government s 
port and artificial incentives to 
produce. 

Now is a time of change, fraugh 
with opportunity. The dawn of the ii 
formation age offers challenges that 
free nations of the world are best po 
to meet, and the United States best 
all. The example of Japan's economic 
cent under a democratic, free-marke 
orientation has invigorated Asia. 
Around the world, the American exi 
pie of democracy and free enterprise 
imitated, from the Philippines to Ko 
to Central America. Economic and \ 
litical reforms in China, Hungary, ar 
even the Soviet Union demonstrate i 
is true even behind the Iron Curtain 
There is a connection between freed' 
and economic progress. We can be 
proud of our example. 

There are pages we can borrow 
from the guide to Japanese success. 



Department of State Bull 






EAST ASIA 



to reduce budget deficits, to in- 
e productivity and com- 
veness, and to make more 
ous efforts to export quality 

apan looks to the United States 
lees lessons for itself. Japan seeks 
itate our success in higher educa- 
Japanese brood over why a Jap- 
; scientist won a Nobel prize for 
.rch performed in the United 
s, not at home where laboratories 
ierarchically organized. Japanese 
its now look at the U.S. experi- 
for clues as their own multina- 
Is adopt overseas manufacturing 
egies to survive the rapid appre- 
m of the yen. 

\fter all the changes and adjust- 
s in recent years, our $4.5 trillion 
)my remains significantly larger 
Japan's, at $2.7 trillion. Japan's 
jerity is dependent more than ours 
able overseas energy supplies. 

land prices, directly related to 
I's protection of agriculture, deny 

Japanese what is taken for 
ted by middle-class Americans, the 
,y to own your own home. It is 
;ing to read that the total price for 
ii's land is more than twice that of 
le land in the United States, with 
latural resources and greater size. 
In the U.S. -Japan relationship, as 
any others, simplistic reactions to 
i imbalances and economic adjust- 
:s are wrong, even counterproduc- 

We see rising employment, 
Uent products, and new technolo- 
emerging all around us. Despite 
idjustments forced by Japanese 
petition on many of our important 
stries, the bottom line is that total 
loyment growth in the United 
es has outpaced that of Europe and 
,n in this decade. U.S. manufaetur- 
has achieved greater productivity to 
t international competition, so that 
ly our exports are booming and the 
is-producing sector of our economy 
'ides 22% of gross national product, 
:h is consistent with our historical 
•age. 

So it is within the context of our 
)al economic, political, and security 
tnership that we must deal with the 
ous trade imbalance between the 
ted States and Japan. Our rela- 
iship today is at once broader, more 
iplicated, and less divisible than just 
•w years ago. In our own interest, 
must conduct our relations with 
an in such a way as to maximize the 
lefit for the United States and for 
an. If we do, together we vdll surely 
lefit the world. ■ 



Visit of Japanese Prime Minister 




Prime Minister Noboru Takeshita 
of Japan made an official working visit 
to Washington, B.C., January 12-15, 
1988, to meet with President Reagan 
and other government officials. 

Following are remarks made by 
President Reagan and Prime Minister 
Takeshita following their meeting on 
January 13 and the text of the joint 
statement on economic issues A 



REMARKS, 
JAN. 13, 1988 

President Reagan 

It has been a great pleasure to welcome 
Prime Minister Takeshita on his first 
visit to Washington since taking office 
in November. He is the leader of one of 
the world's great nations and one of 
America's most valued friends. 

Our meetings were constructive 
and amiable. We discussed the vital is- 
sues of the day and established an ex- 
cellent personal rapport. Good personal 
relationships between the leaders of 
Japan and the United States are essen- 
tial as our two nations strive to con- 
front the challenges of this century and 
the next. 

During our discussions today. 
Prime Minister Takeshita and I found 
that our views on international ques- 
tions coincide to a remarkable degree. 
We share an abiding commitment to 
democratic institutions and to free mar- 
kets to protect freedom and human 
rights. We are dedicated to improving 
the economic well-being not just of our 
own people but of all mankind. In this 
regard, I was especially pleased with 
the Prime Minister's global economic 
perspective. He outlined significant 



plans for expanding Japanese domestic 
demand and stimulating growth. He re- 
viewed Japan's plan to increase its for- 
eign assistance budget next year to an 
amount second only to that of the 
United States. And he expressed 
Japan's determination to continue the 
process of economic adjustment. 

The Prime Minister and I discussed 
and affirmed our support for the eco- 
nomic policy coordination process 
adopted at the Tokyo and Venice eco- 
nomic summits. A joint statement con- 
cerning our bilateral undertakings in 
that regard will be released shortly. 

The U.S. -Japan treaty of mutual 
cooperation and security is the founda- 
tion upon which our relationship is 
built. I was satisfied to note that U.S.- 
Japan cooperation in the national se- 
curity area is strong and growing and 
that Japan's recently announced budget 
provides for continued significant in- 
creases in the area of national defense. 
Japan's growing contribution to the 
maintenance of U.S. forces in Japan is 
of immense value to the United States. 
I might add that Japan's national de- 
fense program is entirely consistent 
vnth the concept of self-defense and in 
no way poses any threat to others. 

During our meetings, I briefed the 
Prime Minister on the details of last 
month's summit. We agreed on the ben- 
efits of the INF Treaty, and he was 
encouraged by the possibility of even 
further arms cuts with the Soviet 
Union. I was gratified that the Prime 
Minister expressed Japan's fullest sup- 
port of our actions, and I assured him 
that we would consult fully with all of 
our allies as we continue our discus- 
sions with the Soviet Union. 



61 



EAST ASIA 



The Prime Minister and I recog- 
nized the danger posed to our mutual 
security in the export of certain kinds 
of high technology. The Prime Minister 
assured me that Japan has taken the 
necessary legislative and administrative 
measures to prevent technology leak- 
age. I told the Prime Minister that I 
appreciated his actions and his commit- 
ment to the vigorous implementation of 
controls over exports of sensitive 
technology. 

The Prime Minister and I concur 
on the importance of the new nuclear 
cooperation agreement. We believe it to 
be a good agreement, and we will exert 
our best efforts to have it come into 
force expeditiously. 

The Prime Minister noted that 
Japan's global trade surplus is declining 
and underlined his determination to ad- 
dress bilateral issues. I was pleased 
with his assurance that he intends to 
resolve a particularly difficult trade is- 
sue — the problem of access for the U.S. 
construction industry — in a satisfactory 
manner. 

We agree the Uruguay Round 
[General Agreement on Tariffs and 
Trade negotiations] must succeed and 
that revision of the world trading sys- 
tem should include a comprehensive re- 
form of trade in agriculture and 
services. I expressed appreciation for 
the Prime Minister's efforts on trade, 
stressing the urgency of expanding op- 
portunities for U.S. farmers and other 
exporters at a time of increasing pres- 
sure for protectionism here in the 
United States. We concurred on the im- 
portance of keeping trade flowing and 
barriers down. For our part, I intend to 
continue my efforts to reduce our budg- 
et deficit, improve American com- 
petitiveness, and combat protectionism. 

We reaffirmed our determination to 
conclude a new science and technology 
agreement, with equitable and expand- 
ing research benefits for scientists of 
both countries. I expressed apprecia- 
tion for Japan's initiatives to provide 
more than $4 million in science fel- 
lowships to American researchers. We 
also reaffirmed the spirit of the 1983 
U.S. -Japan joint policy statement on 
energy cooperation. 

The Prime Minister and I noted 
with satisfaction political developments 
in the Republic of Korea and our inten- 
tion to help make the 1988 Olympic 
Games a success. We also pledged to do 
our utmost to help the Philippine Gov- 
ernment and its people in this period of 
economic adjustment. 

In sum, our talks were positive and 
forthright, and it's been a great pleas- 
ure to have the Prime Minister here 



with us in Washington. I look forward 
to being with him again in Toronto this 
spring. 

Prime Minster T^keshita^ 

I'm extremely pleased with the results 
of the cordial and candid exchange of 
views I had with you today. 

Thanks to your efforts over the 
past years, the historic INF Treaty was 
signed last month. I look forward to its 
expeditious entry into force. And as 
one representing a member of the 
West, I am determined to firmly sup- 
port the President in his pursuit of sub- 
stantive progress in East- West 
relations, where much remains to be 
done across a broad spectrum of areas. 

The President and I confirm that 
the cooperative relationship between 
Japan and the United States, with the 
unshakable security arrangements as 
its cornerstone, is essential for the 
peace and stability of the Asia-Pacific 
region. I will continue my efforts, with 
the cooperation of the President, for 
further strengthening the credibility of 
the Japan-U.S. security arrangements. 

I explained to the President that 
the Government of Japan has continued 
to provide the funds necessary for 
achieving its current defense program. 
Japan has also continued to increase its 
host-nation support for U.S. forces in 
Japan, whose stationing is an indispens- 
able part of the Japan-U.S. security 
system. Moreover, in view of the recent 
economic conditions adversely affecting 
the financial situation of U.S. forces, I 
noted to the President that the Govern- 
ment of Japan has decided on its own 
initiative to increase further Japan's 
share of such expenditures. 

The President and I agreed that 
today, more than any other time in his- 
tory, policy coordination among major 
countries is required to ensure sus- 
tained growth of the world economy 
and to correct external imbalances. In 
this respect, we agreed that the roles 
to be fulfilled by Japan and the United 
States are of vital importance. We 
shared the recognition that, together 
with the measures taken by individual 
countries, stability of exchange rates is 
indispensable to the achievement of 
these goals as described in our joint 
statement. 

Fully aware of the heavy responsi- 
bility commensurate with Japan's status 
in the international economy, I am de- 
termined to carry out a vigorous eco- 
nomic management policy with 
emphasis on domestic demand expan- 
sion to promote structural adjustment 
to the improved market access and to 



strive for a further steady reduction ;;: 
the current account surplus. In this f 
connection, I explained to the Presid 
that despite an expected drop in net 
exports, Japan's growth for fiscal ye: 
1988 is now projected at 3.8%, a rate 
higher than the previous fiscal year, 
through the formation of the fiscal 
[year] 1988 budget geared toward do 
mestic demand expansion with a subi 
stantial increase in public works 
spending. I also explained the prosp' 
for a $10 billion reduction in Japan's 
current account surplus for fiscal [ye Id 
1988 through these measures. The P 
ident highly appreciated my 
explanation. 

The President, on the other hanJuS 
explained that the measures for bud|( ul 
deficit reduction have been enacted 
based upon the recognition that defii 
reduction is essential to the stability 
today's world economy. I paid tributi 
the President for his endeavors. 

With regard to various economii 
and trade issues which arise as a mj 
ter of course between two increasing 
interdependent economies of Japan i 
the United States, the President am 
confirmed the basic posture that the 
solutions should be sought in the sp 
of cooperation and joint endeavors a 
with the aim of expanding, and not i 
tracting, economic exchanges. 

I expressed my hope that a mut 
ally satisfactory solution will be 
reached on the pending issue of acce 
to major Japanese public works on t 
basis of the proposal that Japan has 
cently made. I also stated to the Pn 
dent the need for early resolutions c 
the pending issue of Japan-U.S. sem 
conductor trade. 

The President and I exchanged 
views on the trade bill currently unc 
deliberation in the U.S. Congress, a 
I expressed my firm support to the 
President's determination to contain 
protectionism. The President and I 
shared the recognition that this yeai 
especially important for the success 
the Uruguay Round and agreed that 
our two countries should take the le 
in its promotion. 

I explained Japan's intensive eff( 
to prevent the recurrence of illegal c (1; 
version of high technologies. The Pn li 
dent highly appreciated the measure ' 
which Japan has taken for this purin 
In this connection, I expressed Japai 
deep concern about moves in the U.; 
Congress toward sanctions against fi 
eign companies, including Toshiba C • 
poration. The President and I agree' 
on the importance of enhancing the ( 
operation in the field of science and 



62 



Department of State BulldP 



EAST ASIA 



imology. I explained about my gov- 
tnent's initiatives to increase the 
jiber of American scientists who will 
iinvited to Japan for research. The 
Isident welcomed these initiatives. 
I e.xpressed my views concerning 
(recycling of funds to the developing 
iitries, including the quantitative 
I qualitative improvement of our offi- 
1 development assistance, in particu- 
land stated that in the draft budget 
Ifiscal [year] 1988, an increase of 
[i over the previous year was se- 
hd for ODA [official development as- 
imce]. In this connection, I was 
huraged that the President appreci- 
(I highly my recent participation in 
I ASEAN [Association of South East 
iin Nations] summit and my subse- 

int visit to the Philippines. The 
jident and I affirmed, in particular, 
ontinue our support to the Aquino 
>rnment and to welcome the Re- 
lic of Korea's firm stride along the 
1 of democracy, as evident in the 
int presidential election, as well as 
ooperate closely toward the success 
le Seoul Olympics this fall. 

The President and I agreed on the 
ortance of the new Japan-U.S. nu- 
r cooperation agreement and its 
■npt entry into force. The President 

I, looking forward to a successful 
)nto summit, agreed to meet again 
bronto. 

In completing my meeting with 
, Mr. President, I feel confident that 
have strengthened further the foun- 
on of the relations between our two 
ntries. It is my determination to 
d upon this basis to make Japan a 
on that contributes to the world. 

I wish to express my heartfelt ap- 
ciation to President and Mrs. Rea- 

for the warm welcome extended to 
and my wife as well as our grati- 
e to the American people for their 
dness and consideration during our 



INT STATEMENT, 

f4. 13, 1988 

!sident Reagan and Prime Minister 
keshita reaffirmed their support for 
I economic policy coordination proc- 
I adopted at the Tokyo and Venice 
Inmits. The President and Prime 
liister endorsed the economic goals 
]1 policies set forth in the December 
I statement of the G-7 [Group of 
I/en finance ministers]. They agreed 
jit the achievement of sustained non- 
ilationary growth and reduced trade 
balances remains a top priority of 



Japan — A Profile 




Geography 

Area: 377,76.5 sq. km. (145,8.56 sq. mi.); 
slightly smaller than California. Cities: 
Capital — Tokyo. Other major cities — Yoko- 
hama, Nagoya, Sapporo, Osaka, Kyoto. 
Terrain: Rugged, mountainous islands. 
Climate: Varies from subtropical to 
temperate. 



People 

Nationality: Noun and adjective — Jap- 
anese. Population (Dec. 1985 est.): 
121,180,000. Annual growth rate (1985): 
0.6%. Ethnic groups: Japanese; Korean 
0.6%. Religions: Shintoism and Buddhism; 
Christian 0.8%. Language: Japanese. 
Education: Literacy — 100%. Life expec- 
tancy (1983)— males 74.2 yrs., females 79.8 
yrs. Work force (58.0 million, 1985): 
Agriculture — 9.5%. Trade, manufactur- 
ing, mining, and construction — 34.1%. 
Services — 48.1%. Government — 5.9%. 



Government 

Type: Parliamentary democracy. 
Constitution: May 3, 1947. 

Branches: Executive — prime minister 
(head of government). Legislative — bi- 
cameral Diet (House of Representatives 
and House of Councillors). Judicial — Civil 
law system with Anglo-American 
influence. 

Subdivisions: 47 prefectures. 



Political parties: Liberal Democratic 
Party (LDP), Japan Socialist Party (JSP), 
Democratic Socialist Party (DSP), Komeito 
(Clean Government Party), Japan Commu- 
nist Party (JCP). Suffrage: Universal over 
20. 

Flag: Red sun on white field. 

Economy 

GNP (1985): $1,322 trillion. Real growth 
rate: 4.5% 1985; 4.3% 1975-85. Per capita 
GNP (1985): $10,922. 

Natural resources: Negligible mineral 
resources, fish. 

Agriculture: Products — rice, vegeta- 
bles, fruits, milk, meat, silk. 

Industry: Types — machinery and 
equipment, metals and metal products, 
textiles, autos, chemicals, electrical and 
electronic equipment. 

Trade (1985): Exports— $175.6 bilHon: 
motor vehicles, machinery and equipment, 
electrical and electronic products, metals 
and metal products. Major markets — U.S. 
37.1%, EC 11.4%, Southeast Asia 18.9%, 
communist countries 9.2%. Imports — 
$129.5 billion: fossil fuels, metal ore, raw 
materials, foodstuffs, machinery, and 
equipment. Major suppliers — U.S. 19.9%, 
EC 6.9%, Middle East 23.1%, Southeast 
Asia 23.4%, communist countries 6.5%. 

Fiscal year: April 1-March 31. 

Exchange rate (Sept. 1986): About 
155 yen = US$1. 

Total net official development as- 
sistance: $3.8 billion (1985 disbursements 
0.29% of GNP). 



Membership in International 
Organizations 

UN and several of its specialized and re- 
lated agencies, including the International 
Monetary Fund (IMF), International Court 
of Justice (ICJ), General Agreement on 
■ftriffs and Trade (GATT), International 
Labor Organization (ILO); International 
Energy Agency (lEA); Organization for 
Economic Cooperation and Development 
(OECD); INTELSAT. 



Taken from the Background Notes of Feb- 
ruary 1987, publishedf by the Bureau of 
Public Affairs, Department of State. Edi- 
tor: Juanita Adams. ■ 



63 



EAST ASIA 



their economic policies. They welcomed 
the recent actions of other industrial 
countries in support of these objectives, 
and called on the newly industrialized 
economies to play a more constructive 
role in fostering a strong world econ- 
omy with reduced external imbalances. 

The President stressed his deter- 
mination to continue the progress that 
has been made in reducing the U.S. 
budget deficit. He indicated that the 
fiscal [year] 1989 budget to be transmit- 
ted to the Congress will continue the 
effort to reduce the budget deficit and 
will meet the deficit reduction objec- 
tives established in the Gramm-Rud- 
man-Hollings budget legislation. The 
President also reiterated his pledge to 
veto protectionist trade legislation 
while seeking authority for the Uru- 
guay Round of trade negotiations. 

Prime Minister 'fokeshita indicated 
that Japan will pursue economic policies 
to continue its strong growth in domes- 
tic demand and to reduce its trade sur- 
plus. The Prime Minister reaffirmed his 
commitment to carrying forward struc- 
tural reform of the Japanese economy 
through implementation of the recom- 
mendations of the Maekawa Report and 



by accelerating liberalization of domes- 
tic financial markets, including de- 
regulation of domestic interest rates. To 
achieve sustained grovrth as well as to 
foster exchange rate stability, the Bank 
of Japan agrees, under the present sta- 
ble price conditions, to continue to pur- 
sue the current policy stance and to 
make efforts to accommodate declining 
short-term interest rates. 

The President and the Prime Min- 
ister believe that the close coordination 
of their policies within the framework 
of the arrangements adopted by the 
Venice summit is establishing the fun- 
damental economic conditions for 
greater stability of exchange rates and 
that a further decline of the dollar 
could be counterproductive. In addi- 
tion, they noted that their authorities 
are cooperating closely on exchange 
markets and have developed arrange- 
ments to assure the adequacy of re- 
sources for their cooperative efforts. 



'Text from Weekly Compilation of 
Presidential Documents of Jan. 18, 1988. 

2Prime Minister Takeshita spoke in 
Japanese, and his remarks were translated 
by an interpreter. ■ 



U.S. Japanese Relations 



Background 

Since 1952 when the U.S. -Japan peace 
treaty went into effect, Japan has be- 
come a valued U.S. ally, a major eco- 
nomic power, and a staunch member of 
the Western community. In his January 
1988 Washington visit. Prime Minister 
Noboru Takeshita restated the primacy 
of the U.S. relationship in Japan's for- 
eign policy. Japan receives about 11% of 
U.S. exports — a share larger than that 
of any country except Canada — and we 
buy roughly one-third of Japan's ex- 
ports. Our combined gross national 
product totals about one-third of world 
GNP. Close and cooperative relations 
with Japan form the cornerstone of 
U.S. policy in Asia. The President and 
Japan's Prime Minister, the Secretary of 
State and the Japanese Foreign Minis- 
ter, and subcabinet level officials meet 
frequently on bilateral and global 
issues. 



Mutual Security 

Japan's cooperation with the United 
States under the 1960 bilateral Treaty 



of Mutual Cooperation and Security has 
been crucial to peace and stability in 
East Asia. Japan hosts 60,000 U.S. 
troops and supports 7th Fleet ship vis- 
its and homeporting, including the only 
aircraft carrier battle group based over- 
seas. Japan contributes $2 billion in 
host-nation support for U.S. forces. 
U.S. bases and facilities in Japan en- 
able the United States to maintain re- 
gional defense capabilities, thus serving 
our mutual security interests. Although 
Japan's Constitution and government 
policy preclude an assertive mihtary 
role in international relations, Japan 
has undertaken to defend its sealanes 
within 1,000 nautical miles, providing a 
credible deterrent to Soviet adven- 
turism in Northeast Asia and allowing 
more flexibility for U.S. forces in case 
of emergencies in the Southwest Pacific 
and Indian Oceans. Defense spending 
increased an average 5.4% in real terms 
over the last 10 years, well above 
NATO's 3% goal. For FY 1988, the Jap- 
anese defense budget is $30 billion, 
fifth largest in the world and second 
largest of any non-nuclear power. 



Economic Relations 

Japan is our largest agricultural cus- a 
tomer and our third largest foreign i it 
vestor. We are Japan's largest exporl :esi 
market and largest foreign investor. ISf'i 
Our trade deficit with Japan was clo ^f^ 
to $60 billion in 1986 and again in 19 linti 
Long-term capital inflows from Japa hsii 
are estimated at $65 billion in 1986, ta 
with increasing direct investment in' ib 

1987. The United States, Japan, the set' 
United Kingdom, Canada, West Gen lep 
many, Italy, and France make up th fcl 
Group of Seven industrial nations th ill) 
have worked to coordinate exchangi |(j 
rates and economic policies to assur It) 
stable economic growth. The yen-do* 
rate reached a high point of 262 yen la 
dollar in February 1985 and lowered lir 
about 130 yen per dollar by January ' 

1988. Over time this will help reduce 
Japan's global current account surph 
($86 billion in 1986) as well as our bi 
eral imbalance. Japan is shifting fro; 
export-led to domestic-led growth p' 
icies to reduce imbalances. After en 
ing $36 billion in domestic stimulus 
measures in 1987, Japan experiencec 
negative net external growth and 
strong domestic expansion and is ex 
pected to have 3.7% real GNP grow 
in its FY 1987 (April 1987-March 19J 
Japan's exports measured by volumt 
fell 1.9% in 1987, while imports rose 
8.2%. Japan's current account surph 
should decline in 1988. 



East-West Issues 

Japan has supported U.S. arms coni 
initiatives, including the U.S.-U.S.S 
agreement on intermediate-range m 
clear forces, which will reduce Sovit 
missiles in range of Japan. Japan is ; 
member of the Coordinating Commi 
for Multilateral Export Controls 
(COCOM) that works to control stra 
gic exports to the Soviet bloc. Follo\ 
ing the Toshiba Machine diversion c; 
Japan strengthened penalties, staffii 
and enforcement to prevent future d 
versions. Relations with the U.S. S.I 
have never been close, in part becau 
the Soviets since World War II have 
occupied four islands that the Japam 
claim as their "Northern Territories 



Relations With Other Nations 

After relations with the United Stai 
Japan places primary importance on 
lations with its Asian neighbors. Tit 
between Beijing and Tokyo have de^ 
oped rapidly since 1978, and Japan L 
the leading donor of economic aid to 



64 



ECONOMICS 



apan maintains economic, but 
inatic, relations with Taiwan. 
leives significant Japanese eco- 
>istance as a result of a his- 
r tvchange of visits in 1983, 1984, 
ifUtMi by Prime Minister Nakasone 
President Chun. Japan has long- 
1 interests in the Persian Gulf 
h supplies most of its oil, and will 
ice a $10 million system to aid navi- 
)n by commercial ships. Tokyo pro- 
s economic aid to countries of 
legic importance to the West, such 
gypt, Turkey, and Pakistan, and 
ntly announced new programs for 
in ($200 million) and Jordan ($300 
on) to promote regional stability. 
n has become increasingly active in 
ca and Latin America through mul- 
eral development projects. It has 
id the United States in support of 
refugee relief programs, UNESCO 
Educational, Scientific and Cul- 
1 Organization] reform, a $21 mil- 
study of alternatives to the Panama 
al, and in many other activities that 
jfit world peace and prosperity. 

istance to Less Developed 
intries 

986-90 Japan will disburse more 
1 $40 billion in foreign assistance, 
easing annual aid to more than 
> billion. In 1986 Japan was the sec- 
largest donor of foreign aid, and 
in could surpass the United States 
he world's largest donor in the 
■)s. In 1987 Japan announced a $20 
on program to recycle funds to de- 
)ping countries without restricting 
chases with these monies to Jap- 
se goods. Subcabinet level consulta- 
is are held regularly to coordinate 
foreign assistance programs, and 
United States supports Japan's 
)rts to open its markets to develop- 
countries' products. Japan's aid is 
tributed roughly 70% to Asia and 
each to Latin America, Africa, and 
Middle East. 



U.S. Removes GSP Status 
for Four Economies 



en from the GIST series of January 
i, published by the Bureau of Public 
airs, Department of State. Editor: Har- 
. CuUey. ■ 



WHITE HOUSE STATEMENT, 
JAN. 29, 19881 

Because of their remarkable advance- 
ments in economic development and 
their recent improvements in trade 
competitiveness. President Reagan to- 
day has decided to remove four partici- 
pants from the trade preference 
program that permits certain imports 
from developing countries to enter the 
United States duty-free. Effective Jan- 
uary 2, 1989, Hong Kong, the Republic 
of Korea, Singapore, and Taiwan will be 
graduated from the generalized system 
of preference (GSP), a move that will 
affect nearly $10,000 million in imports. 

Since its inception in 1976, the gen- 
eralized system of preferences has been 
a program of temporary incentives 
rather than permanent tariff advan- 
tages. Through the years, we have reg- 
ularly reviewed the 3,000 products from 
141 beneficiaries that are eligible for 
GSP treatment and removed benefits 
from those products that no longer 
needed preferential treatment to com- 
pete in the U.S. market. Today's action 
is in keeping with the original intent of 
the program and with its operation dur- 
ing the past 12 years. 

Over the past decade, Hong Kong, 
the Republic of Korea, Singapore, and 
Taiwan have made such tremendous 
strides in their economic development 
that they can now compete effectively 
in the United States without preferen- 
tial treatment. Indeed, they have suc- 
cessfully fulfilled the objectives of the 
program. Last year nearly 60% of GSP 
benefits went to these four benefici- 
aries, a disproportionate amount for 
such advanced economies. Their gradu- 
ation will open additional opportunities 
for the remaining beneficiaries — those 
most in need of the program. 

This move should not be inter- 
preted as penalizing any of the benefici- 
aries being graduated from the 
program. On the contrary, it reflects 
the great economic successes they have 
had. All four are good friends and val- 
ued trading partners. But the gener- 
alized system of preferences is a 
development program, and when GSP 
beneficiaries no longer need the pro- 
gram benefits, they should be 
graduated. 

America's relationship with these 
four advanced developing economies has 



entered a new phase, one that is char- 
acterized by greater equality. The 
United States admires their economic 
achievements and their advancement 
toward full partnership in the interna- 
tional trading system. We look forward 
to continued friendship and even closer 
economic ties in the years ahead. 



WHITE HOUSE FACT SHEET, 
JAN. 29, 19882 

The generalized system of preferences 
is a program of tariff perferences 
granted by the United States to devel- 
oping countries to assist in their eco- 
nomic development. Nineteen other 
countries also maintain GSP programs. 
At present the United States grants 
duty-free treatment to approximately 
3,000 products from 141 beneficiaries. 
Since the program's implementation on 
January 1, 1976, the value of GSP-eligi- 
ble benefits has risen from $3,200 mil- 
hon to $13,900 million in 1986. 

GSP-eligible imports from Hong 
Kong, the Republic of Korea, Sing- 
apore, and Taiwan totaled nearly 
$10,000 million in 1987. These four ben- 
eficiaries alone accounted for 58% of all 
GSP duty-free trade in 1986 and about 
60% through the first 10 months of 
1987. 

The President took this action after 
examining a broad range of economic 
development and competitiveness indi- 
cators, including their per capita gross 
national product, their economic growth 
rates, and their ability to export man- 
ufactured goods into the United States. 
He has directed the U.S. Trade Repre- 
sentative [Clayton Yeutter] to prepare 
the necessary documentation to imple- 
ment his decision. 

Although GSP trade with these 
four beneficiaries is nearly $10,000 mil- 
Uon, their graduation from the program 
will have limited impact on their econo- 
mies. GSP trade represents only 
15%-20% of their total trade with the 
United States. Furthermore the aver- 
age U.S. tariff on GSP-eligible items is 
only about 5%. 



'Text from Weekly Compilation of 
Presidential Documents of Feb. 1, 1988. 

^Text from White House press 
release. ■ 



•11 1988 



65 



EUROPE 

The U.S. Approach to Eastern Europe: 
A Fresh Look 



by John C. Whitehead 

Address before the Washington 
Institute of Foreign Affairs on Jan- 
uary 19, 1988. Mr Whitehead is Deputy 
Secretary of State. 

The Eastern Europe we have known 
since World War II is on the verge of 
dramatic change. The push for change 
comes from many different sources — 
from the Soviet Union, from restless 
populations, and from the demands of 
the world economy. This change, when 
it comes, will present both dangers and 
opportunities to the United States. We 
must seek to avoid the dangers and to 
capitalize on the opportunities. 

More than 40 years ago, in Fulton, 
Missouri, Winston Churchill described 
how Europe had come to be divided: 
"From Stettin on the Baltic to Trieste 
on the Adriatic, an Iron Curtain has 
descended across Europe," he said. 
Behind it to the east was a third of a 
continent. There, on the other side, 
were vigorous nations — some old, some 
new — with rich cultures and great po- 
tential for creativity and development 
in freedom. The curtain which de- 
scended on them was drawn by the So- 
viet Union. It was not drawn by the 
Soviet Union's wartime allies or the 
people of Europe on either side. 

We are all familiar with the world 
that has evolved in Europe since 
Winston Churchill's speech. It is a 
world where heavily armed camps have 
confronted each other across an arti- 
ficial divide; a world where the le- 
gitimate aspirations of formerly 
independent peoples have been 
smothered by an uninvited presence; a 
world where the Western half has 
blossomed with economic vitality and 
cultural and political diversity while the 
East has consoled itself with struggling 
economies and questionable regimes 
propped up by habit, by fear, and, 
when need arose, by mihtary 
intervention. 



Potential for Change 

But more than at any other time since 
Churchill spoke, the world of Eastern 
Europe is now ripe for change. The im- 
pulse to change is a constant generated 



from within and is reinforced from out- 
side. Improved U.S. -Soviet relations, 
and the INF [Intermediate-Range Nu- 
clear Forces] Treaty that is one tangi- 
ble result of that improvement, have 
eased tensions in Europe, East and 
West. The Soviet Union itself, under 
General Secretary Gorbachev, has al- 
tered the rules of the game. No longer 
the ham-handed enforcer of Stalinist 
doctrines of central planning, Gor- 
bachev's Soviet Union is promoting eco- 
nomic and political reforms in the 
countries of the area and has gotten far 
ahead of the aging leaders of some of 
them. In others, like Hungary and 
Poland, the impulse toward reform has 
already led to significant liberalization. 
Our own policies, which have remained 
remarkably consistent through Demo- 
cratic and Republican administrations 
over four decades, have encouraged di- 
versification and closer ties with the 
West. 

The Soviets' true motives in East- 
ern Europe are still the subject of much 
discussion. And, let us be clear, the 
long-run Soviet interest in maintaining 
a hegemonic relationship with Eastern 
Europe has not changed, although the 
Soviet definition of what this means in 
practice may have evolved. The re- 
sistance to genuine reform is strong 
in countries like Czechoslovakia and 
East Germany. But there is no question 
that a confluence of easing East- West 
tensions, the reform process in the 
U.S.S.R., and enlightened self-interest 
present the United States and the West 
our most important opportunity in 
Eastern Europe in the four decades 
since Winston Churchill's speech. 

Eastern Europe is in flux. Its 
political elites have been cast adrift, 
in terms of role models and reference 
points to the Soviets. We in the United 
States now have a unique and perhaps 
short-lived chance to influence change 
in Eastern Europe in the direction of 
political and economic liberalization. 
These countries are looking for new 
solutions to their stubbornly familiar 
problems. Our challenge is to make 
sure they look to the West for some of 
these solutions and that meaningful po- 
htical as well as economic change oc- 
curs in a peaceful and permanent 
manner. 



llfc 



Observations and Findings 

I have been fortunate to have had a ir'"' 
to play during this critical period. In 
the summer of 1986, Secretary of Sts 
Shultz asked me, as his deputy, to 
a special interest in U.S. relations w 
the countries of Eastern Europe. I v 
comed the challenge. As a private cil 
izen I had had an active personal 
interest in the area for many years, 
believed new opportunities were erne* 
ing for enhancing ties to the mutual 
benefit of the individual countries an- 
the United States. I found a solid for 
dation of policy continuity, which enj 
a bipartisan consensus in this countr 
I found a strong team of interested s 
experienced officials in place in the t 
Department of State and other U.S. 
Government agencies. Drawing on 
these assets, I have since visited eve 
Warsaw Pact country, as well as 
Yugoslavia — some more than once— 
am now going back for followup visit 
including a trip week after next to 
Poland, Bulgaria, Romania, and 
Czechoslovakia. 

In every country I have visited.jl'* 
have talked with the leaders of the 
ernment and the ruling party. I hav#P 
also taken every opportunity for disi 
sions with leading representatives ol 
significant groups who oppose the g« 
ernment and the party. In Czechoslcil|'' 
vakia, for example, I met both with 
Czechoslovak Communist Party Polit 
buro member Vasil Bilak and with 
spokesmen for Charter '77, a moveni 
dedicated to the preservation of poll 
cal and moral values. In Poland, I ni 
with Chairman Jaruzelski, with Car- 
dinal Glemp, and with Solidarity leai 
Lech Walesa and his senior colleagU( 
In every country, I have sought ' 
broad range of contacts which would 
give me a clear picture of local condi i 
tions from contrasting and sometime ' 
competing points of view. In this I v. 
merely building on the practice of oi 
resident diplomats, who in recent ye 
have made such contacts a normal p: 
of their legitimate activities. This ha 
benefited U.S. understanding of loca 
conditions and has had a good effect 
how the United States is seen. It ha 
enhanced the quality of our official r 
tions as well. Finally, I have sought 
found opportunities to learn about n: 
tional, political, and cultural traditio 



66 



Department of State Bulk 



EUROPE 



t ( lonomic organizations; and 

t cultural and economic ties with 
(!■ 'nited States. 

^\liat have I found? On the one 
r . I have found these countries 
a ' a number of undesirable traits. 

y Warsaw Pact country has similar 
• tares and habits of arbitrary gov- 
ritiii and party rule. Even in a 
uti'N as independent from the Sovi- 
5 s Yugoslavia, it is still possible to 

1 jail for nonviolent expression of 
si|n(ived political opinions. There 
.: iftii a tremendous expansion of in- 
i.rial plants, of education, of health 
lict's in Eastern Europe. But expan- 
I has taken place within very similar 
Jieworks designed to impose central 
jrol over every significant aspect of 
j)nal life. 

' If that framework was ever an effi- 
\: vehicle for mobilizing and direct- 
j scarce resources, it no longer is. 
I ry where and in almost every area, 
I a constraint. It stifles initiative 
I imposes unnecessary limits on fur- 
I development. Where it creates in- 
i ives, they are incentives to produce 
wrong goods for the wrong mar- 

, to educate young people for the 
ng jobs or no jobs at all, to guaran- 
employment in the wrong sectors, 
hort, the system creates incentives 
^aste and misallocate resources and 
lan energies. Compared to Western 
ope, the United States, and East 
i, I found an ocean of grayness, un- 
ainty, and discouragement. 

But I also found, in every country, 
nds of initiative and creativity, both 
de and outside the governments and 
parties. Everywhere there are men 

women who see that the old forms 
organization and the old political 
,ures are now obstacles to further 
gress. They recognize that the old 
's no longer mobilize new resources, 
block the efficient use of what they 
e and the creation of what they 
it. In some countries, this recogni- 
1 has penetrated government strat- 

and programs. To be sure, there 
powerful vested interests opposed 
;hange, and the institutional obsta- 
1 to real change in the right direc- 
1 are immense. But governments are 
longer the preserve of the poHtically 
rer and economically illiterate. There 
. spreading consciousness in the 
ty elites that, as the people in each 
ntry have long known, real change 
equired if the country is to advance. 

In each country, finally, I found 
t the drive is not only to modernize 
to modernize in ways that enhance 



national identity and support national 
aspirations. In other countries this 
might lead toward isolationism, toward 
self-absorption. Not in Eastern Europe; 
here, strengthening national identity is 
associated with an end to isolation, 
with breaking down barriers within so- 
ciety and between countries, with re- 
joining Europe and the world. Today's 
East Europeans want to contribute, to 
be sure. They no longer see themselves 
as merely on the receiving end of East- 
West economic transactions and cul- 
tural ties. They are people who have 
suffered long, worked hard, and have 
achievements they wish to share. They 
do not wish to give them up. They are 
seeking to transform rather than de- 
stroy what they have. 

To some extent, this resembles the 
Soviet situation under Gorbachev. But 
it is important to recognize that fer- 
ment in Eastern Europe has indigenous 
roots in history and in the gap between 
reality and opportunity in each country. 
It antedated the reform impulse in the 
Soviet Union. While there may be par- 
allel paths for reformers in the Soviet 
Union and individual East European 
countries in the period ahead, the appe- 
tite for change will persist in the area, 
whatever happens in the Soviet Union. 
The motor is not in Moscow, but in 
Warsaw, Budapest, and Sofia, and it is 
driving in the right direction. 

But perhaps the most important 
thing I found in my visits was the as- 
tonishing diversity in countries often 
considered to be a single faceless bloc. 
These are countries with dramatically 
different cultures, languages, and histo- 
ries. Some have been conquerors; oth- 
ers, the conquered. Some are Roman 
Catholic; others, Muslim and Orthodox. 
Their topography ranges from fertile 
landlocked plains to barren coastal 
mountains, and their people are as dif- 
ferent as their geography. 

Building Better Relations 

The U.S. policy toward Eastern Europe 
has always been based on a recognition 
of this diversity. Americans of every po- 
litical stripe, in and out of government, 
want the nations of Eastern Europe to 
be proud, free, and prosperous. We 
want them to be nations in their own 
right and refuse to consider them as 
part of a faceless bloc. We believe that 
Europe and the world will be more sta- 
ble when the peoples of the area be- 
come more free to assert and develop 
their own personalities and become 
more modern. 



For the past three decades, and 
formally for the past dozen or so years, 
the United States has pursued a policy 
of seeking to improve official ties and to 
develop unofficial ties with each individ- 
ual country at whatever pace it can 
stand. During my trips to Eastern Eu- 
rope, I have laid out an agenda of areas 
where the United States would like to 
make progress as a condition for better 
relations and invited these nations' 
leaders to make step-by-step progress. 

High on our list of priorities in 
every country is human rights and the 
extent to which a country is moving 
toward greater pluralism and democ- 
racy. During my recent trip to East 
Berlin, for example, I told Erich Hon- 
ecker that it was impossible for the 
United States to understand a country 
that shoots its own citizens for trying 
to escape across the Berlin Wall, and I 
received indications these shoot-to-kill 
orders at the wall had been rescinded. I 
have quizzed Zhivkov of Bulgaria on the 
way he treats the Turkish minority. Ro- 
mania's whole approach to human rights 
and fundamental freedoms — not only its 
treatment of its Hungarian minority 
but its treatment of its entire popula- 
tion — will be on my agenda during my 
upcoming trip there. I have urged Pol- 
ish authorities to begin a real dialogue 
with Solidarity. Only through a di- 
alogue with the church and with the 
Polish people can the cycle of cynicism, 
unrest, and repression be broken. 

Also on our list of objectives is im- 
proved trade. Our trade with Eastern 
Europe is small, both as a percentage 
of our trade and as a percentage of 
Eastern Europe's trade with the West. 
But our exports to some of these coun- 
tries have grown significantly in the 
last year. Our 1987 sales to both Poland 
and Hungary, for example, were up 
more than 30% over 1986. There are 
reasonable opportunities for further 
growth: aircraft, food processing, and 
nonstrategic computer equipment are 
areas for true opportunity worth ex- 
ploring. The Hungarians have even set 
up a graduate management institute to 
teach Western business practices to 
their executives. 

These kinds of contacts with the 
West help move these countries incre- 
mentally onto their own paths of devel- 
opment. To the extent they can show 
independence in business dealings, they 
may also come to show independence on 
other matters of interest to the United 
States, from votes in the United Na- 
tions to the fight against international 
terrorism. 



11 1988 



67 



EUROPE 



Of course, since every relationship 
between governments is a two-way 
street based on a balance of benefits, it 
is just as important to consider what 
the countries of Eastern Europe want 
from us. In general terms, what these 
countries want most is to rejoin the 
modern world. There was, perhaps, a 
time when the Stalinist approach to do- 
mestic arrangements and foreign policy 
seemed modern and efficient, but that 
belief is dying where it is not already 
dead. Important elements among both 
those who govern and those who are 
governed in these countries are now 
seeking to minimize or eliminate the 
constraints which keep the country 
backward. These constraints include 
rigid structures, excessive centraliza- 
tion, and the lack of a two-way street in 
relations between the state/party appa- 
ratus and the people. 

Because of these constraints. East- 
ern Europe is playing catch-up ball in a 
game where the rules are changing. We 
in the West have a hard enough time 
adjusting to the pace of social and polit- 
ical change driven by technological and 
scientific development. Such adjust- 
ment is a disaster in Eastern Europe. 
The transition to an information age 
means increased economic marginaliza- 
tion for many of these countries, since 
neither the raw materials nor the heavy 
industrial goods they produce are now 
as important as they need to be, and 
the Stalinist system is inefficient 
when it comes to knowledge-based 
production. 

As a result, what the countries of 
Eastern Europe want most from us is 
economic support. Since the United 
States is and will continue to be an 
important decisionmaker in interna- 
tional financial institutions and remains 
critically innovative when it comes to 
new forms of economic activity and or- 
ganization, we have the leverage to in- 
tegrate all aspects of policy — political, 
economic, cultural — in our developing 
relationships. East European countries 
know that they will have to take into 
account America's most basic objec- 
tives, involving values rather than 
goods, if they are to move ahead in the 
economic field. 



U.S.-U.S.S.R. Meeting 
on Fisheries Issues 



'& 



JOINT STATEMENT, 
JAN. 29, 1988 

U.S. and Soviet fisheries delegations 
met in Moscow during January 26-28 to 
discuss a broad range of fisheries issues 
of mutual concern. These talks were 
held in the spirit of the joint American- 
Soviet statement between President 
Reagan and General Secretary of the 
Central Committee of the Communist 
Party of the U.S.S.R. Gorbachev con- 
cerning fisheries and other matters of 
mutual interest of December 10, 1987. 
The U.S. side was headed by Ambas- 
sador Edward E. Wolfe, Deputy As- 
sistant Secretary for Oceans and 
Fisheries Affairs, U.S. Department of 
State. The Soviet side was headed by 
Dr. V.K. Zilanov, Chief, Department of 
Foreign Relations, Ministry of Fisheries 
of the U.S.S.R. 

Both delegations characterized the 
talks as highly productive. It was 
agreed that the two sides would soon 



conclude arrangements allowing accea * 
by U.S. fishing vessels to the econonl »P 
zone of the U.S.S.R. on the same tert'-' 
as the U.S.S.R. vessels now have inl 
U.S. exclusive economic zone, as pro- 
vided in the current U.S.-U.S.S.R. 
fisheries agreement. 

The two delegations also agreed 
immediately form a bilateral U.S.- 
U.S.S.R. working group on fisheries 
the Bering Sea. This group will inclu 
legal, scientific, and technical spe- 
cialists of both sides which will devel 
recommendations for deaUng with in- 
creased fishing in the Bering Sea. 
Plans are for this group to meet in la 
February or early March in the Unit 
States. 

The talks included finalizing plar ^ - 
for a March industry-to-industry met t'H 
ing in the Soviet Union to discuss po * 
sible fishery commercial joint ventur "' 
and plans to address additional scien *"' 
tific and other issues to improve ovei 
bilateral fisheries cooperation on a ir Tj 
tually beneficial and equitable basis. 



Judging by my three, soon to be 
four, trips to Eastern Europe, I believe 
our approach is working. We have new 
consular conventions with Czechoslo- 
vakia and Yugoslavia and a science and 
technology agreement with Poland. We 
have achieved better cooperation on 
fighting international terrorism with a 
number of the countries. We have won 
important concessions on human rights 
in East Germany and Romania. These 
would be important at any time in our 
relations. 



But, as I said at the beginning, 
activist approach to Eastern Europe 
even more critical now, when the pas 
barriers to change erected and main 
tained by the Soviet Union and by tl 
Stalinist model for 40 years have bee 
partially lowered. We have had a ten 
dency in the United States to focus { 
Eastern Europe only at times of cris 
Now we have an opportunity to help 
effect real change in a direction favoi 
able to our interests without upheav; 
that would endanger all our accompi 
ments to date. We should not squand 
that opportunity. ■ 



68 



Department of State Bulk 



fh Report on Cyprus 



EUROPE 



iSAGE TO THE CONGRESS, 

a 22, 1988' 

jcordance with Public Law 95-384, I 
1 ibmitting to you a bimonthly report 
1 ogress toward a negotiated settlement 
ti Cyprus question. 

'he United Nations Secretary General 
Ijjred his latest biannual report to the 
O'ity Council on Cyprus on November 
, >87, a copy of which is attached. The 
C'tary General highlighted a number of 
anuing concerns. These included the 
sock in the negotiating process, his 
r sting unease over the military buildup 

ith sides on the island, a Greek 
T iot women's march that violated the 
jrity of the buffer zone, and the con- 
,1 ig presence of students in Varosha. 
1 Secretary General also mentioned that 
! Committee on Missing Persons (CMP) 
( Vequently during the past 6 months. 
1 3MP is to be commended for efforts to 
! erate its investigation and its declara- 
)f a "firm intention to reach a conclu- 
itage as soon as possible." 
'he Secretary General underscored 
eed for the parties to foster an atmo- 
re that would reduce tensions and to 
;rate fully with his new Special Repre- 
itive. We share the Secretary Gen- 
i concerns and fully agree with his 
igs on cooperation and reducing 



The Secretary General's new Special 
Representative for Cyprus, Mr. Oscar 
Camilion, traveled to Cyprus, Greece, and 
Turkey in early December Mr. Camilion 
met with Cypriot Foreign Minister 
[George] lacovou, Turkish Cypriot leader 
Denktash, and high-level officials in Greece 
and Turkey. We understand that the new 
Special Representative was well received 
and is preparing to return to Cyprus in the 
near future to begin his efforts to help the 
parties toward the goal of a lasting, mutu- 
ally acceptable settlement. 

The United Nations Security Council 
unanimously adopted Security Council Res- 
olution 604 on December 14, extending the 
mandate of the United Nations Force in 
Cyprus (UNFICYP) for another 6 months. 
The resolution also requests the Secretary 
General to continue his mission of good of- 
fices in Cyprus. 

Unfortunately, the financial condition 
of UNFICYP, which is totally supported 
by voluntary contributions, continues to 
worsen. Seven of the eight troop-contribut- 
ing countries recently sent joint letters to 
the Secretary General and to the Security 
Council President for December (the So- 
viet Union) pointing out that UNFICYP's 
accumulated deficit, which they bear, has 
now passed $160 million. The November 30 
Secretary General's report to the Security 
Council remarks that UNFICYP is fulfill- 
ing its mission in an exemplary manner 



under difficult conditions and that its pres- 
ence remains indispensable. We concur em- 
phatically with the Secretary General's 
assessment and continue to urge other 
countries to increase or initiate contribu- 
tions to UNFICYP. 

We continued active consultations with 
parties and individuals interested in the 
Cyprus dispute during the past 2 months. 
Special Cyprus Coordinator M. James 
Wilkinson responded to requests for meet- 
ings from Cypriot Presidential candidate 
George Vassiliou and from a delegation of 
the Cypriot Committee of Relatives of 
Missing Persons on November 18 and 20, 
respectively. Special Cyprus Coordinator 
Wilkinson and Department of State Deputy 
Assistant Secretary [for Human Rights 
and Humanitarian Affairs] Robert W. Far- 
rand also held separate meetings on De- 
cember 3 and 4 with a delegation from the 
Committee for the Restoration of Human 
Rights throughout Cyprus. 

Sincerely, 

Ronald Reagan 



'Identical letters addressed to Jim 
Wright, Speaker of the House of Represen- 
tatives, and Claiborne Pell, chairman of 
the Senate Foreign Relations Committee 
(text from Weekly Compilation of Presiden- 
tial Documents of Jan. 25, 1988). ■ 



1988 



69 



HUMAN RIGHTS 



i 



The Semantics of Human Rights 



by Richard Schifter 

Address before the Conference on 
Human Rights and Religious Freedom 
sponsored by the Giorgio Cini Founda- 
tion, in Venice, Italy, on February J,, 
1988. Ambassador Schifter is Assistant 
Secretary for Human Rights and Hu- 
manitarian Affairs. 

In the last few decades, an interna- 
tional debate has raged over the vari- 
ous classifications of human rights. We 
have heard discussions of what have of- 
ten been referred to as "civil and politi- 
cal rights," which have been either 
bracketed with or juxtaposed to what 
are called "economic, social, and cul- 
tural rights." Some theoreticians in the 
field of human rights have also spoken 
of a first, second, and third generation 
of human rights. 

The first generation has generally 
been viewed as encompassing civil and 
political rights, the rights so clearly 
enunciated by the writers and thinkers 
of the Enlightenment in the 18th 
century. 

The second generation of human 
rights is generally assumed to include 
the aforementioned "economic, social, 
and cultural rights." In learned discus- 
sions of the subject, it is said that these 
are the contributions of the Marxist- 
Leninist societies. 

The third generation appears to 
be a concoction of issues developed dur- 
ing the last quarter century, including 
what has been referred to as the right 
to a clean environment, the right to 
die, and other relatively new matters of 
social concern. 

Nuclear disarmament has also been 
injected into the debate under the 
rubric "right to life." (I might note that 
anti-abortionists who use the same 
term have evidently not attempted to 
advance their cause in the context of 
the international human rights debate.) 

As a footnote to this introduction of 
the three so-called generations of 
rights, let me point out that the at- 
tribution of the second generation to 
Marxist-Leninist thinking is historically 
and substantively inaccurate. If you 
take a good look at the rights spelled 
out in the Universal Declaration of Hu- 
man Rights and the Covenant on Eco- 
nomic, Social, and Cultural Rights, you 
will find that they fit into the program 



of Franklin D. Roosevelt rather than 
Karl Marx or Lenin. And that should 
not be surprising. After all, it was Ele- 
anor Roosevelt, President Roosevelt's 
widow, who, in her capacity as Chair- 
man of the UN Human Rights Commis- 
sion, played a very important role in 
the framing and ultimate adoption of 
the Universal Declaration, whose text 
served as a basis for the framing of the 
covenants. 



The Relationship Between 
Government and the Individual 

The point I would like to make to you 
today, and this is the theme of my talk, 
is that a good many of us have fallen 
into a semantic trap. Rather than get- 
ting to issues of substance, we often 
debate ad nauseam the question of 
what does or does not constitute a hu- 
man right. It is a debate which has 
become extraordinarily sterile. 

I would suggest that we try to deal 
with these topics by using different ter- 
minology. The bundle of issues with 
which we are here concerned focuses on 
the relationship between government 
and the individual citizen. Let us divide 
that bundle between, on one hand, the 
limits imposed upon government to 
safeguard the integrity and dignity of 
the individual and, on the other hand, 
the affirmative programs and policies to 
be conducted by government to achieve 
the same ends. And let us say further 
that the fact that we are dealing with 
one large bundle of relationships be- 
tween government and the individual 
does not mean that that entire bundle 
must, at all times, be discussed jointly 
or that the same persons are qualified 
to discuss every single issue that comes 
up in this context. In my country, at 
least, the typical expert on the right to 
freedom of expression is not normally 
an expert on the delivery of medical 
care to the elderly. 

Nor is there value in debating the 
question of which set of relationships is 
more important than the other. Let us 
simply say that all are important. That 
point is well illustrated by a story I 
heard quite a number of years ago, 
which, I believe, is also applicable to- 
day. It is the story of two dogs meeting 
at the Czechoslovak-Polish border. One 



dog, seeking to cross from Czechoslo 
vakia to Poland, is slightly on the fat 
side and well-groomed. The dog seek 
to cross from Poland to Czechoslovak 
is bedraggled and scraggly. The dog 
leaving Czechoslovakia asks the othe 
one: "Why are you going to CzechosL, 
vakia?" The other dog answers: "To 
eat," and continues: "But why are yo 
going to Poland?" The first dog an- 
swers: "To bark." 

This story is not only political co 
mentary on comparative conditions ii 
Czechoslovakia and Poland. It is also 
profound observation about the in- 
stinctual character of the drive to ex 
press oneself The philosophers of th' 
Enlightenment defined that instinct. 
They built an ideology around it. Bii 
they did not invent the human drive 
freedom. They described a phenome- 
non, an essental aspect of human 
nature. 

It follows that the desire to be 
free, to be able to express oneself, t 
write as one pleases, to worship God 
accordance with one's conscience or i 
to worship God — all these are not th 
inventions of Western civilization. Tl 
reflect natural human aspirations an 
that is, indeed, why an ideology bas 
on them has worldwide appeal and h 
understandably, served as an underf 
ning for such international standard- 
setting instruments as the Universal 
Declaration of Human Rights. 

But then there are those who ar 
gue that persons who are starving a; 
not concerned about freedom of spee 
That may very well be true. But whi 
we of the West say is that the choice 
before humanity is not one of starvir 
in freedom and eating in slavery. On 
the contrary, as we look around the 
world, we can see that freedom and 
prosperity go hand in hand. The idej 
solution is one in which we, unlike tl 
Czech and Polish dogs in my anecdot 
can both eat and bark. 

What we frequently hear at inte 
national gatherings is that one of the 
principal differences between the twi 
major options of governmental syste) 
offered the world today is that one p 
attention to the special concerns of a 
few individuals and the other cares 
about the welfare of the masses. I si 
mit to you that if one really cares ab 



70 



Department of State BulfBii 



HUMAN RIGHTS 



assfs, one must also care about 
Mini every individual that makes 

mass. Otherwise, as is often the 
; "i.aiiiig" becomes an abstraction, 
ije promise that is not sought to 
ralized. 

vTiat we, who profess the demo- 
: id eulogy, believe is that, as 
. as Jefferson put it when he wrote 
eclaration of Independence, we 
1 eiulowed with certain unaliena- 
trhts, including the right to life, 
y, and the pursuit of happiness. 
!■ rights, we believe, may not be 
(dinated to any allegedly higher 
^dve, as determined either by a 
I' potentate or a collective, self- 

Ituating leadership group. In other 
i, we do not subscribe to what in 
nian terms is called "democratic 
falism." 

n the countries in which principles 
I ividual freedom are now well es- 
Ihed, the basic precepts of individ- 
leedom are not even the subject of 
inent. Such debate as still con- 
is deals with what we might con- 
i marginal questions, such as what 
llowable restrictions on pornogra- 
how serious must be a person's 
al illness before such a person can 
voluntarily committed to a psychi- 
institution; what may government 
restrict freedom of assembly if 
■nstrators interfere with access to 
)lic building? But, as I have said, 
•asic precepts are not in doubt and 
ubject to argument. 
A'^e are then told that with all the 
tion paid to these freedoms to 
i, publish, or assemble, we neglect 
inemployed, the homeless, the sick, 
nyone paying attention to these is- 
of public policy?" is the challeng- 
luestion posed to us in debates. 
My response is that precisely be- 
3 the issues of basic freedoms have 
me so noncontroversial, public de- 
and election campaigns in the 
Dcratic world do, indeed, revolve 
nd questions of economic and social 
y, not because anyone has called 
1 "rights" or outlined them in a 
titutional document but because 
are often in the forefront of the 
king of our ultimate decision- 
ers, the voters. Voters choose 
ng candidates on the basis of who, 
leir opinion, advocates better solu- 
3 to the problems that we face in 
economic and social sphere. It is in 
context that the issue is not one of 
nise, of writing guarantees into 



constitutions and other basic docu- 
ments, but one of delivering results. 

Since the beginning of the century, 
one of the principal arguments in the 
political arena has, indeed, been the 
question of which system of government 
can deliver the best solution to the 
problems we confront in the economic 
and social sphere. By now, in the ninth 
decade of the century, it appears that 
the verdict is in. With all the problems 
that we in the democratic world still 
face, that we continue to grapple with 
day by day, the private-incentive sys- 
tem has proved itself better capable of 
delivering the goods than the various 
collectivist experiments. As we all 
know so well, the country which oper- 
ated the largest collectivist program in 
agriculture abandoned it totally about 8 
years ago and thereafter experienced 
an extrordinarily rapid growth in agri- 
cultural production. It is now trying to 
reintroduce private incentives into all 
other aspects of economic enterprise. 
And, more recently, in other Leninist 
countries, we hear talk of restructur- 
ing, the term that concedes that the 
collectivist command economy has 
proved to be a massive failure. 

The Limits of Government 

Let me now return to my point of de- 
parture. We need to gather at confer- 
ences such as this one to gather those 
experts, practitioners, and thinkers 
who are prepared to discuss the basic 
principles of human freedom and per- 
sonal dignity and the limits which must 
be imposed upon the powers of govern- 
ment to assure respect for those princi- 
ples internationally. And there is, most 
assuredly, nothing wrong with holding 
meetings for the purpose of discussing 
ways and means of dealing with the 
problems of unemployment, as well as 
vocational training, the advisability or 
inadvisability of subsidizing uneconomic 



enterprises, of the creation of make- 
work jobs. We could also discuss differ- 
ing approaches to the encouragement of 
the construction of quality housing, 
providing adequate, safe, and sanitary 
dwellings for those who are now ill- 
housed, the furnishing of medical care 
of quality, and provisions to be made 
for the elderly. All this should be done 
by qualified experts in the fields in 
question and should not be injected into 
discussions on the limits of government, 
which deal with issues, as I noted ear- 
lier, in a wholly different area of 
expertise. 

This conference, devoted to the 
themes which relate to the limits of 
government, should, therefore, appro- 
priately deal with the major threats to 
individual dignity and freedom which 
are posed by the authority of the state. 
It is appropriate, I suggest, to go 
through the relevant articles of the 
Universal Declaration of Human Rights 
which were thereafter incorporated into 
the Helsinki Final Act and determine 
where shortfalls can be identified and 
how steps could be taken to encourage 
correction in these shortfalls. 

For today, almost 40 years after 
adoption of the Declaration and 12 
years after the signing of the Helsinki 
Final Act, the limitations imposed on 
governments to protect the individual's 
liberty; security of person; freedom of 
thought, conscience, and religion; free- 
dom of expression; and similar free- 
doms are, in many places, consistently 
and deliberately violated. These vio- 
lations must not be ignored, for ignor- 
ing them means betraying the heroes 
and heroines throughout the world who 
take great risks and make major per- 
sonal sacrifices, endangering their life 
and personal security so that the cause 
of freedom may live. It is to them that 
we all owe a debt of gratitude. And we 
must continue to discharge that debt by 
speaking up on their behalf wherever 
and whenever we can. ■ 



il 1988 



71 



MIDDLE EAST 



P 



Visit of Egyptian President 



ri i > ' 




President Hosni Mohammed 
Mubarak of the Arab Republic of Egypt 
made a state visit to the United States, 
January 26-30, 1988. While in Wash- 
ington, B.C., he met with President 
Reagan and other government officials. 

Following are remarks made by the 
two Presidents at the arrival ceremony 
on January 28.^ 

President Reagan 

Welcoming good friends to Washington 
and to the White House is one of my 
more pleasant responsibilities as Presi- 
dent. I'm especially pleased today to 
greet, once again, President Mubarak, 
a personal friend and a friend of the 
United States. President Mubarak is 
the proud leader of a proud land: 
Egypt, a country with a special fascina- 
tion for Americans; Egypt, a venerable 
society rich in culture, a country not 
unaccustomed to making history. 

Americans learn from their earliest 
school days about Egypt's extraordi- 
nary place in the history of civilization. 
And recent history records that our 
two countries were partners in one of 
the monumental events of our era: the 
securing of peace between Egypt and 
Israel. The first step toward ending the 



cycle of violence in the Middle East was 
as arduous, painstaking, and wrought 
with danger as any that a country ever 
made. It was a tremendous accomplish- 
ment and a tribute to the vision, cour- 
age, and sincere desire for peace on 
both sides. And, President Mubarak, 
we're heartened by the progress that 
continues under your dynamic and re- 
sponsible leadership. 

In the past few months, Arab coun- 
tries that broke relations with Egypt 
years ago have resumed diplomatic re- 
lations with your country. It's a victory 
for the cause of peace and a tribute to 
your steadfastness as well as a recogni- 
tion that Egypt is again exerting the 
leadership role it has traditionally 
played in Arab councils. We applaud 
you at this moment, when time and 
events have proven you right. 

The United States and Egypt con- 
tinue to work together to broaden the 
peace that started with that first step 
10 years ago. The recent explosion of 
violence in the West Bank and Gaza, 
and the sad toll it has taken in lives 
and injuries, vividly remind us that 
much remains to be done. The danger 
of allowing the Palestinian problem to 
fester is evident and reinforces the 
urgency of moving toward negotiations: 



hard work, creativity, and a willingr 
to take practical, not merely rhetori 
steps are needed. 

If peace is to be achieved, if an- 
other giant step is to be made, mucl 
depends on Egypt and the United 
States. We are partners in this en- 
deavor, and Egypt's own experience 
provides it with special insights. I'n 
looking forward to discussing with y 
your ideas as well as our own thougl 
on how to ensure that hope displace 
despair and real progress is made t( 
ward peace. 

Both of our countries also look 
distress on the seemingly endless C( 
flict between Iraq and Iran. The lat 
aggressive measures to intimidate a 
destabilize other countries in the gi 
and elsewhere in the Middle East ai 
reprehensible and reason for alarm. 
Both the United States and Egypt 
strongly support UN Security Cour 
efforts to end the war, and we shan 
firm commitment to freedom of nav 
tion in the region and the security i 
friendly gulf Arab states. As your i 
cent trip to the gulf clearly demon- 
strates, Egypt has a vital role to pi 
in the pursuit of these goals; and I'' 
pleased to have this opportunity to 
cuss how we can work together to 
achieve them. 

The scope of our cooperation, c 
course, goes far beyond the formuh 
of foreign and diplomatic policy. Eg 
and the United States have also ma 
common cause in advancing Egypt's 
economy and bettering the living si 
ard of its people. America's contrib 
tions to agriculture, industry, powe 
generation, and private sector deve 
ment stand as visible symbols of ou 
broader partnership for progress, a 
partnership that we expect to bene 
both our peoples for many years to 
come. 

All Americans are especially d< 
Hghted that your visit will take you 
yond Washington. I hope that in th 
limited time you have you'll capture 
glimpse of America's heart and sou 
You'll find it in cities and towns aci 
the country, in businesses, in unive 
sities, and in our churches. And thi 
you'll find a love of freedom and a g 
ine good will to you and the people 
Egypt. Your visit, I know, will 
strengthen the bonds and expand t 
potential of American and Egyptiai 
friendship. 



It* 



72 



Department of State Biutii 



MIDDLE EAST 



1 closing, I'd like to share with 
bit (if history. Some may not real- 
: it the U.S. -Egyptian collabora- 
; 1 security issues goes back over 
jars. Shortly after the American 
iltVar, General Charles Pomeroy 
n and General William Wing Lor- 
, )gether with some 50 other of- 
r from the Union and Confederate 
i;^, went to Egypt to work with 
ijyptian Armed Forces. They 
■I d on military training, helped 
!rthen coastal defenses, and shared 
I ideas and their experience. 
eneral Stone left Egypt in 1878, 
is last job after his return to the 
. d States provides a fitting symbol 
enduring relationship. Stone was 
I to design and construct the base 
huge statue, designed and con- 
: ed by a Frenchman, presented to 
nitt'd States by the schoolchildren 
mce. Stone went to work with his 

I energy. He gave lectures on 

I I to help finance the project, and 
I ed two of his former colleagues 

I his days in Egypt to help with 
ng the plans and erecting the 
ture. So, Mr. President, when you 
it the Statue of Liberty, you can 
oud that those who built its solid 
spent nearly a decade in the serv- 
■ Egypt, building a base as well for 
elationship. 

ibday we offer you our welcome 
elebrate the solid friendship be- 
n our countries. President 
Irak, welcome. 



ident Mubarak 

again we meet in your glorious 
al in order to strengthen the bonds 
lendship and understanding be- 
n our peoples. The Egyptian peo- 
.re sending you and each and every 
rican warm greetings and heartiest 
es for success and fulfillment. 
They value the United States as a 
id and a partner in the search for 
e and progress. This friendship is a 
ng one, for it is based on mutual 
ect and a profound conviction that 
ations, regardless of origin and de- 
, share a common interest in the 
ervation of peace and maintenance 
curity. Over the years, our Ameri- 
friendship has served as a force of 
ility and progress; today it remains 
irce of hope and promise. We are 
rmined to deepen this friendship 
intensify our cooperation for our 
mon good. 



President Reagan has made a great 
contribution to the process of strength- 
ening these ties and deepening their 
roots. He's a man of wisdom and convic- 
tion. During the past few years, he has 
taken many steps for the purpose of 
enhancing world peace and security. We 
commend him on his recent achieve- 
ment and congratulate the American 
people on the courageous steps that are 
certain to reduce tension and pave the 
way for a better future for mankind. 

People of good will should build 
upon it in the years ahead to eliminate 
insecurity and stop violence and suffer- 
ing throughout the world. Sincere and 
concrete and concerted efforts are 
urgently needed for solving regional 
conflicts. In this respect, the Middle 
East is a region that requires special 
attention and top priority. It is con- 
fronted with great challenges and rising 
dangers. The United States can do 
much to help all nations of the Middle 
East cope with these problems. 

A few days ago I met with most of 
the area's leaders, and it was their con- 
sensus that certain steps must be taken 
urgently and effectively in order to 
check the continuous deterioration of 
the situation in different parts of the 
Middle East. This is needed not only to 
safeguard the interests of the region's 
people and save the lives of millions of 
innocent individuals but also to protect 
vital American interests. 

The futile war which is raging in 
the gulf threatens the safety and the 
security of all parties. It endangers the 
freedom of navigation and blocks the 
flow of strategic materials that are es- 
sential in international trade as well as 
the prosperity of many nations. It's an 
illusion to speak of restricting the the- 
ater of operations. Even if it happens, 
the fallout from the war would cer- 
tainly spread throughout the region. 
Therefore, the only real solution is to 
end the war immediately and to bring 
the dispute to the negotiating table. 

The tragic situation in the West 
Bank and the Gaza is another source of 
alarm and concern. It is evident that 
the continuation of occupation and op- 
pression would bring loss to and inflict 
damage on all the parts without excep- 
tion. It would badly hurt American in- 
terests in the Middle East. It deals a 
devastating blow to our peace efforts at 
a time when we are looking for a 
breakthrough. 



In the course of our discussion to- 
day, we shall focus on these issues in 
full awareness of their importance and 
ramifications. We shall exchange views 
candidly and sincerely and examine cer- 
tain ideas designed to generate a new 
momentum and initiate movement. 

We realize that many governments 
are preoccupied this year with domestic 
matters and international events. But 
history does not stop, and it is an abso- 
lute must that we continue to move for- 
ward to attain our objectives. This is 
the crux of public responsibility. 

In the past few weeks, we noticed 
with satisfaction that the United 
States, under the leadership of Presi- 
dent Reagan, has taken courageous 
steps in the right direction. This active 
role must continue for our mutual bene- 
fit. The risks involved here cannot be 
compared with the damage that is cer- 
tain to result from inaction and 
stagnation. 

African problems need greater at- 
tention, too. The debt problem is crip- 
pling growth and development in most 
parts of our continent. An equitable so- 
lution must be reached if we want to 
save the lives of millions who face the 
danger of starvation and fatal disease. 

On the other hand, we cannot ac- 
cept the continuation of the worsening 
situation that exists in southern Africa 
today. The fundamental rights of our 
fellow Africans are being violated, and 
their security is being endangered 
every day. The fight for human rights 
and the dignity of man — indivisible, and 
we must maintain our firm commitment 
to work for a better future for coming 
generations. 

I am looking forward to a stimulat- 
ing and fruitful discussion with Presi- 
dent Reagan and his able associates, 
and we shall continue to an objective 
exchange of views during the months 
ahead. We shall always be guided by 
the spirit of genuine friendship and sin- 
cerity, which has dominated our rela- 
tions consistently. 

Together we shall endeavor to 
serve the cause of peace and derive 
hope in the midst of despair and frus- 
tration. Together we shall overcome. 



'Made in the East Room at the White 
House, where President Mubarak was ac- 
corded a formal welcome (text from Weekly 
Compilation of Presidential Documents of 
Feb. 1, 1988). ■ 



11988 



73 



MIDDLE EAST 



Arab Republic of Egypt 



Geography 

Egypt is located in the northeastern 
corner of Africa and has a land area of 
about 1 miUion square kilometers. It is 
bounded by the Mediterranean Sea, 
Libya, Sudan, the Red Sea, the Gulf of 
Aqaba, and Israel. The total area uti- 
lized by the people — the Nile Valley 
and Delta — is less than 40,000 square 
kilometers, about half the size of South 
Carolina. Egypt is part of the wide 
band of desert that stretches from the 
Atlantic coast of Africa into the Middle 
East. 

There are four distinct physical di- 
visions: the Nile Valley and Delta, the 
Western Desert, the Eastern Desert, 
and the Sinai Peninsula. Of 26 gover- 
norates, four are cities (Cairo, Alex- 
andria, Port Said, and Suez), nine are 
in Lower Egypt (the Nile Delta region), 
eight are in Upper Egypt, and five 
cover the Sinai and the desert areas 
east and west of the Nile. 

"Egypt," wrote the Greek historian 
Herodotus 25 centuries ago, "is the gift 
of the Nile." The seemingly inexhausti- 
ble resources of water and soil carried 
by this mighty river created in the Nile 
Valley and Delta the world's most ex- 
tensive oasis; without the Nile, Egypt 
would be little more than a desert 
wasteland. The river carves a narrow, 
cultivated floodplain, never more than 
20 kilometers wide, as it travels north- 
ward from Sudan and forms Lake 
Nasser behind the Aswan High Dam. It 
then winds past the archeological won- 
ders of Luxor (ancient Thebes) and the 
cities of Qina and Asyut. Just north of 
Cairo, the Nile spreads out over what 
was once a broad estuary that has been 
filled by riverine deposits to form a fer- 
tile delta about 250 kilometers wide 
(150 mi.) at the seaward base and about 
160 kilometers (96 mi.) from south to 
north. 

Until the erection of dams on the 
Nile, particularly the Aswan High 
Dam, the fertility of the Nile Valley 
was dependent not only upon the flow 
of water but also upon the silt depos- 
ited by annual flood waters. Sediment 
is now obstructed by the Aswan High 
Dam and retained in Lake Nasser. The 
discontinuation of yearly, natural fertil- 
ization and the increasing salinity of the 
soil have detracted somewhat from the 
high dam's value. Nevertheless, the 
benefits remain overwhelming: more in- 
tensive farming on millions of acres of 



land made possible by improved irriga- 
tion; prevention of damage caused by 
periodic serious flooding; and produc- 
tion of billions of kilowatt-hours of elec- 
tricity yearly at very low cost. 

The Western Desert accounts for 
about two-thirds of the country's land 
area. For the most part, it is a massive 
sandy plateau marked by seven major 
depressions. One of these, Fayoum, was 
connected about 3,600 years ago to the 
Nile by canals and is now an important 
irrigated agricultural area. The largest 
and lowest depression is Qattara, a 
huge saltwater marsh, lake, and 
badlands area about the size of New 
Jersey, which reaches about 120 meters 
(400 ft.) below sea level. 

The Eastern Desert differs dramat- 
ically from the Western Desert. The 
land rises abruptly from the Nile and 
forms an upward-sloping plateau of 
sand, which gives way within 80-130 
kilometers (48-78 mi.) to rocky, defoli- 
ated hills running north and south be- 
tween the Sudanese border and the 
delta. This region is isolated from the 
rest of the country and, except for a 
few towns on the Red Sea coast, is 
largely uninhabited. 

The Sinai Peninsula is slightly 
smaller than West Virginia (61,000 sq. 
km. -24, 400 sq. mi.). Closely akin to the 
desert, it is largely mountainous in the 
south and contains a flat coastal plain 
in the north. The southern mountains 
include Egypt's highest point (2,637 
m.-8,702 ft.). Mount St. Catherine. 

The climate is characterized by a 
two-season year, long hours of blazing 
sunshine, and a severe lack of rainfall. 
A relatively cool winter lasts from 
November to March, and the hot sum- 
mer extends from April to October. 
Temperatures in coastal regions fluctu- 
ate from a minimum mean of 14°C to a 
maximum mean of 30°C (57°F-86°F). In 
the inland deserts, temperatures vary 
widely on a daily basis, from a maxi- 
mum annual mean of 40°C during the 
daylight hours to a minimum mean of 
7°C after sunset (109°F-45°F). Tem- 
peratures in such places as Luxor and 
Aswan, however, can reach 49°C (120°F) 
and higher. 

Most rain falls along the coast, but 
even there the average annual pre- 
cipitation is only 20 centimeters (8 in.). 
Inland, the amount declines rapidly un- 
til it averages just over 1 centimeter a 
year at Cairo. At the Sudanese border, 



«1 



d 



precipitation is minimal. Years with '|" 
rain may be followed by a heavy doM 
pour, resulting in flash floods and cc 
siderable damage. 

A phenomenon of Egyptian 
weather is the hot, driving windstoi 
called the khamsin. Khamsins, whip 
occur in the spring, have been know 
raise the temperature 20 degrees in 
hours and to carry winds of up to l^f*' 
kilometers (84 mi.) per hour. 

People 

Egypt is the most populous countrj 
the Arab world and the second mos 
populous on the African Continent. 
Ninety-nine percent of the country's 
million people live in Cairo and Ale: 
andria, elsewhere on the banks of t 
Nile River, in the Nile Delta, whicl 
fans out north of Cairo, and along t 
Suez Canal. These regions are amo 
the world's most densely populated, 
containing an average of over 1,450 
sons per square kilometer (3,600 pe 
sq. mi.). Small communities spread 
throughout the desert regions of E; ^' 
are clustered around oases and hist f " 
trade and transportation routes. Tl 
government has tried, with mixed ; 
cess, to encourage migration to nev> 'u 
irrigated land reclaimed from the d li 
ert. However, the proportion of the 
population living in rural areas has 
tinued to decrease as people move 
the cities in search of employment 
a higher standard of living. 

The Egyptians are a fairly hon 
nous people of Hamitic origin. Med 
ranean and Arab influences appear 
the north, and there is some mixinj, 
the south with the Nubians of nort 
Sudan. Ethnic minorities include a 
small number of bedouin Arab nom 
dispersed in the Eastern and West( 
Deserts and in the Sinai, as well as 
some 50,000-100,000 Nubians clustc 
along the Nile in Upper Egypt. Be 
construction of the Aswan High Da 
began, Nubian villages stretched ir 
ularly along the Nile; they have sin 
been relocated along the banks of I 
Nasser. 

The literacy rate is about 44% 
the adult population. Education is 11 
through university and compulsory 
from ages 6 to 12. About 80% of all 
children enter primary school; half 
these drop out after their sixth yea 
There are 11,000 primary and secon 
schools with some 6 million student 
and 12 major universities with abou 
500,000 students, as well as 67 teac 
colleges. Major universities include 
those of Cairo (100,000 students) ai 



74 



Department of State BuMii; 



MIDDLE EAST 



gndria and the 1,000-year-old Al- 
ia I'liiversity, one of the world's 
[ ers of Islamic learning. 
. s vast and rich literature 
Uiius an important cultural ele- 
vin the life of the country and in 
.rail world as a whole. Its novelists 
Ki s were among the first to ex- 
iiem with new styles of Arabic lit- 
e, and the forms they developed 
)een widely imitated. Egyptian 
and films are available through- 
16 Middle East. 



ry 

t has endured as a unified state 
ore than 5,000 years, and arch- 
cal evidence indicates that a de- 
3d Egyptian society has existed 
longer. Modern leaders urge 
tians to take pride in their 
aonic heritage" and in their de- 
from mankind's earliest civilized 
y. The Arabic word for Egypt is 
which originally connoted civiliza- 
ir metropolis. 

ircheological findings show that 
tive man lived along the Nile long 
e the dynastic history of the phar- 
began. By 6000 B.C., organized 
ulture had appeared, 
n about 3100 B.C., Egypt was 
d under a ruler known as Mena, or 
IS, who inaugurated the 30 phar- 
dynasties into which Egypt's an- 
history is divided — the Old and 
le Kingdoms and the New Empire, 
he first time, the use and manage- 
of vital resources of the Nile 
r came under one authority, 
rhe pyramids at Giza (near Cairo) 
built in the fourth dynasty, show- 
he power of the pharaonic religion 
state. The Great Pyramid, the 
) of Pharoah Khufu (also known as 
)ps), is the only surviving example 
e Seven Wonders of the World. An- 
; Egypt reached the peak of its 
;r, wealth, and territorial extent in 
period called the New Empire 
?-1085 B.C.). Authority was again 
ralized, and a number of military 
paigns brought Palestine, Syria, 
northern Iraq under Egyptian 
rol. 

Persian, Greek, Roman, and Arab 
querors. In 525 B.C., the Persian 
"ior Cambyses, son of Cyrus the 
it, led an invasion force that de- 
ned the last pharaoh of the 26th 
isty. The country remained a Per- 
province until the conquest of Al- 
ider the Great in 332 B.C. This 
ndary figure founded and gave his 



A Profile 




Geography 

Area: 1,001,258 sq. km. (386,650 sq. mi.); 
slightly smaller than Texas, Oklahoma, and 
Arkansas combined. Cities: Capital — 
Cairo (pop. over 12 million). Other cities — 
Alexandria (4 million), Aswan, Asyut, Port 
Said, Suez, Ismailia. Terrain: Desert ex- 
cept Nile Valley and Delta — desert, waste- 
land, urban (96.5%), cultivated (2.8%), 
inland water (0.7%). Climate: Dry hot 
summer, moderate winters. 



People 

Nationality: Noun and adjective — Egyp- 
tian(s). Population (1986): 50.5 million. 
Annual growth rate: 2.8%. Ethnic 
groups: Egyptian, bedouin Arab, Nubian. 
Religions: Sunni Muslim 90%, Coptic 
Christian. Languages: Arabic (official), 
English, French. Education: Years com- 
pulsory — ages 6-12. Literacy — 44%. 
Health: Infant mortality rate — (1986) 
102/1,000. Life expectancy— 58.3 yrs. Work 
force: Agriculture — 41%. Services — 22%. 
Industry — 14%. Trade and finance — 11%. 
Other— 12%. 

Government 

Type: Republic. Independence: 1922. 
Constitution: 1971. 

Branches: Executive — president, 
prime minister, cabinet. Legislative — Peo- 
ple's Assembly (448 elected and 10 presi- 
dentially appointed members) and Shura 
(Consultative) Council (140 elected, 70 
presidentially appointed). Judicial — Court 
of Cassation, State Council. 



Administrative subdivisions: 26 

governorates. 

Political parties: National Democratic 
Party (ruling), New Wafd Party, Socialist 
Labor Party, Socialist Liberal Party, Na- 
tional Progressive Unionist Grouping, 
Umma Party. Suffrage: Universal over 18. 

Central government budget (FY 
1987): $12.2 billion. 

Flag: Three horizontal stripes — red, 
white, and black from top to bottom — with 
a golden hawk in the center stripe. 

Economy 

GDP (1986 est.): $30 billion. Annual 
growth rate: 2.0%. Per capita GNP (1986 
est.): $600. 

Natural resources: Petroleum and nat- 
ural gas, iron ore, phosphates, manganese, 
limestone, gypsum, talc, asbestos, lead, 
zinc. 

Agriculture: Products — cotton, rice, 
onions, beans, citrus fruits, wheat, corn, 
barley, sugar. 

Industry: Types — food processing, tex- 
tiles, chemicals, petrochemicals, construc- 
tion, light manufacturing, iron and steel 
products, aluminum, cement, military 
equipment. 

Trade (FY 1985-86): Exports— $Z.Z bil- 
lion: petroleum, cotton, manufactured 
goods. Major markets — U.S., Japan, 
Italy, F.R.G., France, U.K. Imports— 
$11.4 billion: foodstuffs, machinery and 
transport equipment, paper and wood 
products. Major suppliers — U.S., F.R.G., 
France, Japan, Netherlands, U.K., Italy. 

Free market exchange rate: 2.20 
Egyptian pounds = US$1 (fluctuates). 

Membership in 
International Organizations 

UN and some of its specialized and related 
agencies, including the International Mon- 
etary Fund (IMF), World Bank; General 
Agreement on Tariffs and Trade (GATT); 
Nonaligned Movement; Organization of Af- 
rican Unity (OAU); Organization of the Is- 
lamic Conference (OIC). ■ 



11988 



75 



MIDDLE EAST 



name to Alexandria, the port city that 
became one of the great centers of the 
Mediterranean world. After Alex- 
ander's death in 323 B.C., the Macedo- 
nian commander, Ptolemy, established 
personal control over Egypt, assuming 
the title of pharaoh in 304 B.C. The 
Ptolemaic line ended in 30 B.C. with 
the suicide of Queen Cleopatra. 

The Emperor Augustus then estab- 
lished direct Roman control over 
Egypt, initiating almost seven centuries 
of Roman and Byzantine rule. Accord- 
ing to tradition, St. Mark brought 
Christianity to Egypt in A.D. 37. The 
church in Alexandria was founded 
about A.D. 40, and the new religion 
spread quickly, reaching Upper Egypt 
by the second century. 

Following a brief Persian recon- 
quest, Egypt was invaded and con- 
quered by Arab forces in 642. A 
process of Arabization and Islamization 
ensued. Although a Coptic Christian 
minority remained — and remains 
today, constituting about 10% of the 
population — the Arabic language inex- 
orably supplanted the indigenous Cop- 
tic tongue. Ancient Egyptian ways — 
passed from pharaonic times through 
the Persian, Greek, and Roman periods 
and Egypt's Christian era — were gradu- 
ally melded with or supplanted by 
Islamic customs. For the next 1,300 
years, a succession of Turkish, Arabic, 
Mameluke, and Ottoman caliphs, beys, 
and sultans ruled the country. 

European Influence. Napoleon 
Bonaparte arrived in Egypt in 1798. 
The 3-year sojourn in Egypt (1798-1801) 
of Napoleon's army and a retinue of 
French scientists opened Egypt to the 
direct influence of the West. Napoleon's 
adventure awakened Great Britain to 
the importance of Egypt as a vital link 
with India and the Far East and 
launched a century-and-a-half of Anglo- 
French rivalry over the region. 

An Anglo-Ottoman invasion force 
drove out the French in 1801, and, fol- 
lowing a period of chaos, the Albanian 
Mohammed All obtained control of the 
country. All ruled until 1849, and his 
successors retained at least nominal 
control of Egypt until 1952. He im- 
ported European culture and tech- 
nology, introduced state organization of 
Egypt's economic life, improved educa- 
tion, and fostered training in engineer- 
ing and medicine. His authoritarian 
rule was also marked by a series of 
foreign military adventures. All's suc- 
cessors granted to the French pro- 
moter, Ferdinand de Lesseps, 
concession for construction of the Suez 



76 



Canal — begun in 1859 and opened 10 
years later Their regimes were charac- 
terized by financial mismanagement 
and personal extravagance that reduced 
Egypt to bankruptcy. These develop- 
ments led to rapid expansion of British 
and French financial oversight, produc- 
ing in turn popular resentment, unrest, 
and, finally, revolt in 1879. 

In 1882, the arrival of a British ex- 
peditionary force, which crushed this 
revolt, marked the beginning of British 
occupation and the virtual inclusion of 
Egypt within the British Empire. Dur- 
ing the rule of three successive British 
High Commissioners between 1883 and 
1914, it was the British Agency — not 
the khedive's palace — that was the real 
source of authority. Under the "capit- 
ulations" to which Egypt submitted, 
special courts were set up to enforce 
foreign laws for foreigners residing in 
the country. These capitulations and re- 
sultant privileges for foreigners gener- 
ated increasing Egyptian resentment. 
To secure its interests during World 
War I, Britain declared a formal protec- 
torate over Egypt on December 18, 
1914. This lasted until February 28, 
1922, when, in deference to growing na- 
tionalist current, Britain unilaterally 
declared Egyptian independence. Brit- 
ish influence, however, continued to 
dominate Egypt's pohtical Hfe and fos- 
tered fiscal, administrative, and govern- 
mental reforms. 

In the postindependence period, 
three political forces competed with one 
another: the Wafd, a broadly based, na- 
tionalist political organization strongly 
opposed to British influence that had 
led the effort for independence immedi- 
ately after the war; King Fuad, whom 
the British had installed on the throne 
during the war; and the British them- 
selves, who were determined to main- 
tain control over the Suez Canal. 
Although both the Wafd and the king 
wanted to achieve independence from 
the British, they fought one another for 
control of Egypt. Other political forces 
emerging in this period included the 
Communist Party (1925) and the Mus- 
lim Brotherhood (1928), which eventu- 
ally became a potent political and 
religious force. 

During World War II, British 
troops used Egypt as a base for Allied 
operations throughout the region. Brit- 
ish troops were withdrawn to the Suez 
Canal area in 1947, but nationalist, 
anti-British feelings continued to grow 
after the war Violence broke out in 
early 1952 between Egyptians and Brit- 
ish in the canal area, and anti-Western 
rioting in Cairo followed. 



k 



V. 



On July 22-23, 1952, a group of 
affected army officers led by Lt. Co 
Gamal Abdel Nasser overthrew Kinj 
Farouk, whom the military blamed ! ( 
Egypt's poor performance in the 194 
war with Israel. Following a brief e 
periment with civilian rule, they abi 
gated the 1923 constitution and 
declared Egypt a republic on June 1 
1953. Nasser evolved into a charism 
leader, not only of Egypt but of the 
Arab world as a whole. 

Nasser and his "Free Officer" 
movement enjoyed almost instant le 
imacy as liberators who had ended 
2,500 years of foreign rule. They we 
motivated by numerous grievances ; 
goals but wanted especially to breal 
the economic and political power of 
landowning elite, to remove all vest 
of British control, and to improve tl 
lot of the people, especially the fellc 

A secular nationalist, Nasser d 
oped a foreign policy characterized 
advocacy of pan- Arab socialism, lea 
ership of the "nonaligned" or "Thin 
World," and close ties with the Sov 
Union. He sharply opposed the Wei 
ern-sponsored Baghdad pact. Wher 
United States held up military sale 
reaction to Egyptian neutrality vis 
vis Moscow, Nasser concluded an a 
deal with Czechoslovakia in Septem 
1955. When the United States and 
World Bank withdrew their offer to 
help finance the Aswan High Dam 
mid-1956, he nationalized the privat 
owned Suez Canal Company. The ci 
that followed, exacerbated by grow 
tensions with Israel over guerrilla ; 
tacks from Gaza and Israeli reprisa 
resulted in the invasion of Egypt tl 
October by France, Britain, and Is 
While Egypt was defeated, the invj 
forces were quickly withdrawn und' 
heavy U.S. pressure. The Suez wai 
as the Egyptians call it, the tripart 
aggression) instantly transformed 
Nasser into an Egyptian and Arab 
hero. Nasser soon after came to tei 
with Moscow for the financing of th 
Aswan High Dam — a step that enoi 
mously increased Soviet involvemer 
Egypt and set Nasser's government 
a policy of close ties with the Sovie 
Union. In 1958, pursuant to his poll 
of pan-Arabism, Nasser succeeded 
uniting Egypt and Syria into the 
United Arab Republic. Although th 
union had failed by 1961, it was not 
officially dissolved until 1984. 

Nasser's domestic policies were Hi 
bitrary, frequently oppressive, yet 
erally popular All opposition was 



ink, 



MIDDLE EAST 



it'll out, and opponents of the re- 
l'i\i|uently were imprisoned with- 
ial Nasser's foreign policies, 
; other things, helped provoke the 
i attack of June 1967 that vir- 
destroyed the Armed Forces of 
t, Jordan, and Syria and led to 
's occupation of the Sinai Penin- 
the Gaza Strip, the West Bank, 
he Golan Heights. Nasser, none- 
s, was revered by the masses in 
t and elsewhere in the Arab world 
his death in 1970. 

)ne of the original "Free Officers," 
President Anwar al-Sadat, was 
d president after Nasser's death. 
71 Sadat concluded a treaty of 
Iship with the Soviet Union but a 
later ordered Soviet advisers to 
Egypt. In 1973 he launched the 
)er war with Israel, in which the 
tian Armed Forces performed ef- 
ely. With his country's credibility 
red, Sadat felt able, in 1974 and 
with U.S. participation, to negoti- 
ffo Sinai disengagement agree- 
s with Israel by which Egypt 
ned the Suez Canal and parts of 
iinai. 
n 1977 Sadat journeyed to Jerusa- 

meet with Prime Minister Men- 

1 Begin and to address the Israeli 
set. This breakthrough fore- 
owed the Camp David accords of 
smber 1978 and the Egypt-Israel 
e Treaty of 1979, both negotiated 
intensive U.S. participation, 
ughout this period, U.S. -Egyptian 
ions steadily improved, but Sadat's 
ngness to break ranks by making 

e with Israel earned him the en- 
of most Arab states. 
In domestic policy, Sadat intro- 
id greater political freedom and a 
economic policy, the most impor- 
aspect of which was the infitah, or 
n door." This policy relaxed govern- 
t controls over the economy and en- 
aged private investment. Sadat 
lantled much of Nasser's police ap- 
,tus and brought to trial a number 
rmer government officials accused 
iminal excesses during his prede- 
or's rule. This liberalization also in- 
ed the reinstitution of due process 
the banning of torture. Sadat tried 
icpand participation in the political 
ess in the mid-1970s but later aban- 
;d this effort. In the last years of 
ife, Egypt was racked by violence 
ng from discontent with Sadat's 
and sectarian tensions, and it ex- 
enced a renewed measure of 



On October 6, 1981, President 
Sadat was assassinated by Islamic ex- 
tremists. Hosni Mubarak, vice presi- 
dent since 1975 and Air Force 
Commander during the October 1973 
war, was elected president later that 
month. Mubarak has maintained 
Egypt's commitment to the Camp 
David process, while at the same time 
improving ties with the Arab world and 
resuming a more active role in such in- 
ternational forums as the United Na- 
tions and the Nonaligned Movement. 
Domestically, he has supported the 
public sector of the economy while also 
encouraging the private sector. His 
most notable achievements have been to 
strengthen democratic institutions, to 
increase greatly freedom of the press, 
and to put an end to sectarian strife. 
President Mubarak was re-elected to a 
second term in October 1987. 

Government and Political Conditions 

The Egyptian constitution provides for 
a strong executive. Authority is vested 
in an elected president who can appoint 
one or more vice presidents, a prime 
minister, and a cabinet. The president's 
term runs for 6 years. Egypt's legisla- 
tive body, the People's Assembly, has 
458 members — 448 popularly elected 
and 10 appointed by the president. The 
constitution reserves 50% of the assem- 
bly seats for workers and peasants. The 
assembly sits for a 5-year term but can 
be dissolved earlier by the president. 
There is also a 210-member National 
Shura (Consultative) Council, in which 
70 members are appointed and 140 
elected under a system in which the 
party receiving the majority of votes 
takes all the seats. The council's func- 
tions are more advisory than legisla- 
tive. Below the national level, authority 
is exercised by and through governors, 
mayors appointed by the central gov- 
ernment, and by popularly elected 
councils. 

Although power is concentrated in 
the hands of the president and the Na- 
tional Democratic Party's majority in 
the People's Assembly, opposition par- 
ties organize, publish their views, and 
represent their followers at various lev- 
els in the political system. In addition 
to the National Democratic Party, there 
are five legally constituted parties: the 
New Wafd Party, the Socialist Labor 
Party, the Nationalist Progressive 
Unionist Grouping, the Socialist Lib- 
eral Party, and the Umma Party. The 
New Wafd Party and the Socialist La- 
bor Party (in alliance with the Socialist 



Liberals and the MusHm Brotherhood) 
won seats in the People's Assembly in 
elections of April 1987. The law prohib- 
its the formation of parties on religious 
or class lines, thereby making it illegal 
for Islamic or communist groups to 
organize formally as political parties. 
However, members of the Muslim 
Brotherhood, an organization legally 
proscribed under the provisions of this 
law, are members of the assembly as 
part of the Socialist Labor Party 
delegation. 

Egypt's judicial system is based on 
European (primarily French) legal con- 
cepts and methods. Under the Mubarak 
government, the courts have demon- 
strated increasing independence, and 
the principles of due process and judi- 
cial review have gained greater respect. 
The legal code is derived from the 
Napoleonic code, and within the Mus- 
lim community. Islamic law plays a sig- 
nificant role. 

The process of gradual political lib- 
eralization begun by Sadat has con- 
tinued under Mubarak. Egypt now 
enjoys unprecedented freedom of the 
press, and opposition political activity 
is regarded by the government as both 
desirable and natural. The April 1987 
parliamentary elections were marked 
by the greatest freedom of political ex- 
pression seen in Egypt for more than 
three decades. Although some electoral 
irregularities were reported, there 
were no accusations of widespread in- 
volvement by the internal security 
forces in these activities — a charge fre- 
quently leveled in the past. 

Economy 

Egypt's 51 million people produced a 
gross domestic product (GDP) of about 
US$30 billion in FY 1987. Agriculture 
and services each contribute roughly 
one-third of GDP; the remainder comes 
from industry, petroleum, mining, elec- 
tricity, and construction. 

Although Egypt's private sector is 
expanding, public sector enterprises re- 
main predominant in the industrial sec- 
tor. Most sizable enterprises, including 
virtually all heavy industries, are 
owned by the state. Many privately 
owned small- and medium-scale indus- 
tries' prices are controlled by the state 
or face competition from products sub- 
sidized by the government. Only 35% of 
industrial production originates in the 
private sector, but this share is grow- 
ing. Much of agriculture, though nomi- 
nally private, is, in fact, regulated 



11988 



77 



MIDDLE EAST 



through price control, import alloca- 
tions, and guidelines on production ad- 
ministered through local agricultural 
cooperatives. Construction, nonfinancial 
services, and domestic marketing are 
largely private. 

For several years following na- 
tionalization of the Suez Canal Com- 
pany in 1956, the economy performed 
reasonably well, and Egypt experi- 
enced steady growth: GDP increased at 
4%-7% per year. This growth was 
broadly based, with the construction 
sector performing above this range and 
agriculture at the low end. 

From the mid-1960s through the 
early 1970s, the economy stagnated. 
The initial momentum in the early 
1960s was lost as economic centraliza- 
tion outran limited managerial exper- 
tise. The terms of trade shifted against 
Egypt, and a chronic foreign exchange 
shortage developed. The drain on re- 
sources and morale from Egypt's in- 
volvement in the war in Yemen and the 
June 1967 war was especially damaging. 
The loss of Suez Canal revenue and 
Western assistance, together with a 
heavy military burden, reinforced nega- 
tive pressures on the economy. Per cap- 
ita growth was negligible. Neverthe- 
less, at the expense of a steadily deteri- 
orating capital stock, Egypt was able to 
maintain consumption and an adequate 
living standard. 

Economic prospects began to 
brighten after the 1973 war. Sadat's 
turn to the West and first steps toward 
economic liberalization encouraged the 
private sector and foreign investment. 
The central element of these policies 
was Law 43, the so-called open door, 
which brought foreign banks to Egypt 
and provided a liberalized investment 
code to foreign investors. Law 159 
eventually extended new investment in- 
centives to indigenous entrepreneurs as 
well. The reopening of the Suez Canal 
in 1975 and the return of the Sinai 
oilfields added new sources of foreign 
exchange to Egypt's economy, but the 
balance of payments remained strapped 
as food, capital, and consumer goods 
imports grew. New oil production 
added to revenues, as did the revival of 
the tourist trade. Egyptians in ever- 
mounting numbers found employment 
abroad, primarily in other Arab coun- 
tries, and their remittances became the 
largest single source of foreign ex- 
change earnings. The influx of Arab 
(until 1979) and Western funds (both 
public and private) also helped. In the 
late 1970s and early 1980s, despite 
mounting budget and current account 



78 



deficits, Egypt attained real growth 
rates in the range of 8%-10% annually. 
Today the Egyptian economy faces 
several challenges. In 1986 Egypt was 
faced with a difficult economic situa- 
tion. Falling oil prices, tourist earnings, 
and expatriate remittances through offi- 
cial channels reduced foreign exchange 
inflows, which in turn made it more 
difficult for the Government of Egypt 
to service its $38-billion debt. The 
Egyptian Government initiated a major 
review of economic policy and em- 
barked on an economic reform program 
aimed at simplifying the exchange rate 
system and introducing a greater re- 
liance on market forces and an ex- 
panded role for the private sector. This 
program enabled Egypt to qualify for 
financial assistance from the Interna- 
tional Monetary Fund and a multilateral 
rescheduling of external debts owed to 
Western creditors. 

Agriculture. More than one-third 
of the Egyptian labor force is engaged 
directly in farming, and many others 
work in the processing or trading of 
agricultural products. All but a tiny 
part of Egyptian agriculture takes 
place in some 2.5 million hectares (6 
million acres) of fertile soil in the Nile 
Valley and Delta. Although some desert 
lands are being reclaimed for agri- 
culture, other more fertile lands in the 
Nile Valley and Delta are being lost to 
urbanization and erosion. 

The climate and ready availability 
of water, especially since the building of 
the Aswan Dam, permit multiple crop- 
ping — several crops a year on the same 
piece of land. This, in effect, almost 
doubles the actual crop area per y^^ar. 
Although improvement is possible, agri- 
cultural productivity is high, consider- 
ing the traditional methods used. 
Egypt has little subsistence farming. 
Cotton, rice, onions, and beans are the 
principal crops. Cotton is the largest 
agricultural export earner. 

The United States is a major sup- 
plier of wheat to Egypt, particularly 
through the PL 480 (Food for Peace) 
program, and other Western countries 
have also supplied food on concessional 
terms. 

Natural Resources. Egypt has few 
natural resources other than the agri- 
cultural capacity of the Nile Valley. The 
major minerals are petroleum, phos- 
phates, and iron ore. The fall in world 
oil prices during the mid-1980s hit 
Egypt hard. On top of a large drop in 
per-barrel oil earnings, Egypt's slow- 
moving price-setting mechanism pre- 
vented it from competing successfully 



for oil sales. As a consequence, Egy 
tian oil production in 1986 dropped b 
low 1985 levels in spite of new additilj 
to production capacity. As oil prices 
stabilized in late 1986, Egypt began 
regain its share of the market. Pe- 
troleum production is steadily incres (] 
ing, and exploration continues, 
particularly in the Western Desert, 

Transport and Communication 

Transportation facilities in Egypt fo 
the pattern of settlement along the 
Nile. The major line of the nation's 
4,700-kilometer (2,800-mi.) railway i 
work runs from Alexandria to Aswa 
Other important lines run along the 
north coast to the Libyan border an 
eastward to the Suez Canal. Egypt 
about 12,300 kilometers (7,600 mi.) 
paved roads and some 16,700 kilome 
(10,400 mi.) of gravel or improved e; 
roadways. Most of these roads are 
found in the Nile Valley and Delta, 
the Suez Canal, and along the Red I 
and Sinai coasts. An additional 18,0' 
kilometers (11,200 mi.) of unimprove 
desert track can be found in the We 
em and Eastern Deserts. The Nile 
River system (about 1,600 km., or 1 
mi.) plus another 1,600 kilometers o 
navigable canals are important for i 
land transport. Major ports are Ale 
andria. Port Said, and Port Suez. A. 
major cities have airports, although 
all have civil air service. Cairo Inte: 
tional Airport is the most importan 
Egypt has long been the cultur 
and informational center of the Ara 
Middle East, and Cairo is the regioi 
largest publishing and broadcasting 
center. 'There are 20 daily newspapt 
with a total circulation of more thar 
million, as well as a large number o! 
weekly and monthly newspapers, m 
zines, and journals. Newspapers sei 
not only to inform but also are an 
important element of the political pi 
ess. Every political party has its ow 
newspaper, and these papers conduc 
lively, often highly partisan debate i 
public issues. Major papers include 
prestigious, establishment daily Al- 
Ahram; the dailies Al-Akkbar, Al- 
Gomhuriya, and Wafd (newspaper o 
the New Wafd Party); the weekly pj 
newspapers — Mayo (National Demo 
cratic Party), al-Shaab (Socialist La 
Party), al-Ahali (Nationalist Pro- 
gressive Unionist Grouping), and al- 
Ahrar (Socialist Liberal Party); and 
merous other publications such as R 
al-Yusef, al-Mussawwar, and Octob' 
Egypt's Middle East News Agency 
(MEN A) was the first of its kind in 



ngt 



let 



ing 



^l^ 



MIDDLE EAST 



ji and continues to play an impor- 
tiolc in reporting news to and from 
1(1. lie East. 

iiiler President Nasser, Egypt led 
r:ili world in developing a compre- 
M' broadcasting system. State-run 
■) til ins are coordinated under the 
vtuui Radio and Television Federa- 
Thf Egyptian Broadcasting Cor- 
ion operates seven domestic and 
nternational radio stations, trans- 
ig in 32 languages for a total of 
Durs a day. The state-owned Egyp- 
Television Organization operates 
hannels, broadcasting to a rapidly 
ng national audience. 



t's Armed Forces are the largest 
; region, totaling roughly 470,000 
nnel divided into four services, 
irmy is by far the largest — 
00 — followed by air defense with 
0, air force with 27,000, and navy 
120,000. Beginning in 1979, the 
! ;d States entered into a military 
y relationship with Egypt that has 
nued throughout the 1980s. 
it's inventory also includes equip- 
from European sources — France, 
the United Kingdom — and China, 
much of the military equipment is 
viet origin, reflecting the long pe- 
of almost exclusive Soviet supply 
the late 1950s until the 1973 war 
Israel. Most of this equipment is 
obsolete. Egypt has provided mili- 
assistance and training to a 
Der of African and Arab states, as 
eks to bolster stability and modera- 
in the region. 

ign Relations 

it and Camp David. In a momen- 
change from the Nasser era, Pres- 
t Sadat shifted Egypt from a policy 
nflict with Israel to one favoring 
eful accommodation through direct 
itiation. Following the Sinai disen- 
ment agreements of 1974 and 1975, 
:sh opening for progress was cre- 
by Sadat's dramatic visit to Jeru- 
n in November 1977. This led to 
ident Jimmy Carter's invitation to 
it and Israeli Prime Minister Begin 
in him in trilateral negotiations at 
p David. The outcome was the his- 
Camp David accords, signed by 
it and Begin and witnessed by Car- 
m September 17, 1978. These 
ements comprise frameworks for a 
Drehensive settlement of the Middle 
. conflict and for a peace treaty be- 
in Egypt and Israel. 



Passport Restriction for Lebanon 



DEPARTMENT STATEMENT, 
FEB. 5, 1988' 

On February 1, Secretary Shultz ex- 
tended his directive invalidating U.S. 
passports for travel to, in, and through 
Lebanon. This decision follows a deter- 
mination that the situation in Lebanon 
remains so dangerous for Americans 
that no U.S. citizen can be considered 
safe from terrorist acts. 

Recent events in Lebanon under- 
score our concern. On January 27, 
Ralph Schray, a Lebanese-German dual 
national, was kidnapped. Although 
Schray has a West German passport, 
his German ties are extremely tenuous. 
Schray reportedly has lived in Lebanon 
his entire life and speaks little, if any, 
German. Nevertheless these weak links 



were sufficient to make him a kidnap 
victim, apparently in an effort to pres- 
sure the West German Government dur- 
ing the trial of Abbas Hamadeh. 

American dual-national citizens 
could be equally vulnerable to the same 
fate. The Department of State takes 
this opportunity to reiterate its warn- 
ing that the situation in Lebanon is so 
dangerous that all Americans, including 
dual nationals, can become targets of 
terrorist acts, including kidnapping. 
The U.S. Government reminds all U.S. 
citizens that its ability to provide nor- 
mal consular services there is ex- 
tremely circumscribed. 



'Read to news correspondents by De- 
partment deputy spokesman Phyllis 
Oakley. ■ 



Negotiations on bilateral peace be- 
gan in October 1978 and were concluded 
with the signing of the Egypt-Israel 
Peace Treaty on March 26, 1979. How- 
ever, efforts at progress on the other 
framework, which provides for the es- 
tablishment of transitional arrange- 
ments for the West Bank and Gaza, 
proved problematical. After Jordan and 
representative Palestinians declined to 
take part, the United States joined 
Egypt and Israel in the negotiations to 
shape an autonomous self-governing au- 
thority for the area. Some progress was 
made in bridging differences on the 
nature and responsibilities of the self- 
governing authority, but the negotia- 
tions ended in 1982 without a final ac- 
cord on transitional arrangements. 

Mubarak Era. President Mubarak 
has reaffirmed and built upon the pol- 
icies he inherited from Sadat, placing 
heavy emphasis on negotiated solutions 
to the Arab-Israeli dispute, peace with 
Israel, and close ties with the United 
States. At the same time, he has moved 
toward reintegration with the Arab 
world and taken a more active role in 
the Nonaligned Movement, the Organi- 
zation of African Unity, and other mul- 
tilateral forums. He has, by and large, 
succeeded. At mid-decade, Egypt is 
playing a prominent role in interna- 
tional affairs, and Egyptian diplomats 
are often among the candidates for 
important international positions. 



Egypt's relations with Israel are solid, 
and officials of the two countries meet 
frequently. Headed by an ambassador, 
Egypt's embassy in Tel Aviv and 
consulate in Eilat are staffed and open 
for business. In 1986, Egypt and Israel 
agreed to resolve the T^ba border dis- 
pute through arbitration. Egypt has 
also reestablished its important posi- 
tion in the Islamic and Arab worlds. 
Readmission to the Organization of the 
Islamic Conference and restoration of 
full diplomatic relations with Jordan in 
1984 were key steps. Despite the lack of 
official diplomatic relations with much 
of the Arab world, Egypt maintains 
close political, commercial, and social 
ties with nearly all Arab countries. 

U.S. -Egyptian Relations 

Before 1967 U.S. relations with Egypt 
went through several cycles. In the 
wake of the 1952 revolution, ties be- 
came strained for a number of reasons, 
which included: 

• Egypt's opposition to U.S. -spon- 
sored collective security efforts, espe- 
cially the Baghdad pact of 1955; 

• Its arms purchases from the 
Eastern bloc and improving ties with 
the Soviet Union; 

• U.S. refusal to finance the Aswan 
High Dam; and 

• Differing American and Egyptian 
perspectives on the Arab-Israeli 
dispute. 



11988 



79 



SOUTH ASIA 



Relations improved somewhat in 
the late 1950s, and the United States 
provided Egypt with technical as- 
sistance, development loans, and food 
aid. In 1964, however, there was an- 
other downturn, and following the out- 
break of the June 1967 war, Egypt 
severed formal diplomatic relations. 
Nevertheless, diplomatic contacts, 
trade, and scientific exchanges 
continued. 

President Sadat's decision following 
the October 1973 war to opt for nego- 
tiations with Israel was accompanied by 
a turn toward the United States. For- 
mal diplomatic relations were re- 
established on February 18, 1974. The 
series of negotiations between Egypt 
and Israel, culminating in the Camp 
David accords of 1978 and the Egypt- 
Israel Peace Treaty of 1979, demon- 
strated that Egypt and the United 
States could work together and opened 
the way for wider regional and bilateral 
cooperation. 

Since his election in October 1981, 
President Mubarak has strongly sup- 
ported a special U.S. -Egyptian rela- 
tionship. During his 6 years in office, 
he has met on several occasions in 
Washington with President Reagan, re- 
ceived many senior U.S. officials and 
Members of Congress, and maintained 
an active dialogue with the United 
States on Middle East and other re- 
gional concerns. 

U.S. economic and military aid to 
Egypt reached a level of $2.3 billion in 
FY 1987. As development projects con- 
structed with U.S. assistance and 
weapons systems procured with foreign 
military sales credits have begun to be 
completed and delivered, the fruits of 
this aid have become more apparent to 
the average Egyptian. U.S.-Egyptian 
strategic cooperation, including joint 
mihtary exercises, has also improved 
the capacity of both countries to re- 
spond to threats to regional security. 

Between 1974 and 1987, the United 
States authorized $23 billion in total aid 
for Egypt — $13 billion in economic aid 
and $10 billion in military assistance. In 
FY 1987, the United States is providing 
$815 million in economic assistance (eco- 
nomic support fund); $189 million in 
food aid (PL 480); $1.3 billion in grant 
mihtary assistance; and almost $2 mil- 
lion in military training (international 
miUtary education and training). 

U.S. aid is designed to assist 
Egypt's economic development and sup- 
port U.S.-Egyptian cooperation. U.S. 



economic aid helps stimulate economic 
growth by funding direct commodity 
imports such as raw materials and cap- 
ital equipment. U.S. assistance also 
supports electric power, telecommunica- 
tions, housing, and transport projects. 
Powerplants built with U.S. assistance 
generate more electricity than the 
Aswan High Dam. In 1983 the United 
States agreed to a 5-year, $l-billion pro- 
gram to overhaul the water and 
sewerage systems of Cairo, Alexandria, 
and other Egyptian cities. 

U.S. military cooperation has 
helped Egypt replace its deteriorating 



/ 



inventory of Soviet-supplied weapoi 
with modern equipment and impro\ 
ability to support regional security 
stability. Major items the United S'lfk 
is providing Egypt under FMS pro- 
grams include F-4 jet aircraft, F-I 
fighters, M60A3 tanks, armored pe 
sonnel carriers, Improved-Hawk 
(I-Hawk) antiaircraft missile battel 
E-2C aerial surveillance aircraft, a> <i 
other equipment. 



Taken from the Background Notes of ] 
cember 1987, published by the Bureau 
Public Affairs, Department of State. I 
tor: Juanita Adams. ■ 



inf 



Continuation of Aid to Pakistan 



WHITE HOUSE STATEMENT, 
JAN. 15, 19881 

The President today signed and sent to 
Congress waivers to the law that would 
require a cutoff in aid to Pakistan un- 
der the Symington and the Solarz 
amendments because of activities in the 
nuclear weapons development area. 
This waiver action was based on the 
recognition that disrupting one of the 
pillars of the U.S. relationship with 
Pakistan would be counterproductive 
for the strategic interests of the United 
States, destabilizing for South Asia, 
and unlikely to achieve the non- 
proliferation objectives sought by the 
sponsors. 

The Government of Pakistan is 
aware of our continuing concern over 
certain aspects of its nuclear program. 
Despite these problem areas, there are 
crucial nonproliferation criteria which 
Pakistan continues to honor. The 
United States will insist on the mainte- 
nance of these restraints even as we 
work with Pakistan on progress in the 
areas of concern. 

The President's action is preceded by 
months of extensive consultations with 
Congress. We have achieved an under- 
standing on the general approach which 
is reflected in approval by Congress of 
a 30-month waiver of the Symington 
amendment and near-full funding for 
Pakistan for FY 1988. The Administra- 
tion pledged to continue pressing 



Pakistan away from a nuclear weaf 
option and is obliged to certify anr 
that Pakistan does not possess nuc 
weapons. 

The reasons which convinced t 
Administration to waive the Symin 
amendment also apply to the Solar 
amendment, where the waiver app 
only retroactively. The Governmen 
Pakistan has pledged that procedui 
will be tightened to ensure an end 
procurement activities in the Unit* 
States. We will continue to monito 
procurement activities in this coun 
to ensure compliance with Pakistai 
new procedures. 

There is no diminution in the ] 
dent's commitment to restraining t 
spread of nuclear weapons in the I 
subcontinent or elsewhere. We will 
tinue to urge Pakistan and India t( 
cuss measures which might be takt 
reduce the threat of a nuclear arm: 
race in South Asia. As arms contn 
negotiations between the United S 
and the Soviet Union begin to bea: 
fruit and set an example, the Adm 
istration will be seeking still furthi 
ways to make this commitment 
effective. 



J I 



'Text from Weekly Compilation of 
Presidential Documents of Jan. 18, 19J 



80 



Department of State BuM*' 



TED NATIONS 



Agencies and the Budget 



hard S. Williamson 

atement before the Subcommit- 
i Human Rights and Intema- 
Organizations and on 
ational Operations of the House 
n Affairs Committee ow February 
?5. Ambassador Williamson is 
ant Secretary for International 
ization Affairs.^ 

my first appearance before a 
;ssional committee since my re- 
onfirmation as Assistant Secre- 
f State for International 
ization Affairs. It is a pleasure 
mor to be here. 

nee I will be joining Ambassador 
*s [U.S. Permanent Represen- 
to the United Nations Vernon A. 
rs] 2 days from now in a presenta- 
)r you on the United Nations, I 
icus today on other parts of the 
/stem. I would, of course, be 
■d to join with my colleagues at 
epartment of State in addressing 
organizations covered by the Con- 
ions to International Organiza- 
(CIO) account, if and when you or 
;olleagues elsewhere in the Con- 
are interested. In like manner, I 
orward to addressing the signifi- 
vork undertaken in behalf of eco- 
■ development through our 
tary contributions to such organi- 
is as UNICEF [UN Children's 
I, the UN Development Program, 
he UN Environment Program, 
ly statement for the record today, 
fore, highlights the following 
areas: 

My initial impressions of the sub- 
ive work undertaken by the major 
lical and specialized agencies of the 
;d Nations, with particular empha- 
1 the extent to which they serve 
rtant U.S. national interests; 
• The results of efforts encouraged 
le U.S. Congress and the executive 
ch to achieve reform in the deci- 
naking procedures on budgetary 
ers in these technical agencies of 
Jnited Nations; and 
» Finally, the criteria-based inter- 
cy process used by the executive 
ch, in close consultation with the 
fress, to allocate the limited funds 
able for fiscal years (FY) 1988 and 



The Productive Work 
of the UN Agencies 

These subcommittees will be discussing 
the work of the United Nations during 
the hearing 2 days from now. We can go 
into more detail on the United Nations 
at that time. However, suffice it to say 
here that many believe that, for too 
long, the debate over the United Na- 
tions in New York, and the need for 
specific changes in its administration, 
have overshadowed much of the work of 
the smaller but very important tech- 
nical agencies in the UN system. 

In general, I believe that the tech- 
nical agencies, such as the World 
Health Organization and the Interna- 
tional Atomic Energy Agency, have re- 
ceived insufficient public attention. 
Many Americans are not familiar with 
the important and constructive work 
being performed by many technical and 
specialized agencies in the UN system. 
All of us here today are painfully aware 
of the global challenges resulting from 
acquired immune deficiency syndrome 
(AIDS), the tragic hijacking of the 
cruise ship Achille Lauro, the recent 
bombing of Korean Air Lines Flight 
858, and the widespread fear and legiti- 
mate concerns that followed the acci- 
dent at the Soviet nuclear power plant 
at Chernobyl. 

We also are familiar with less dra- 
matic but important continuing prob- 
lems such as food shortages in sub- 
Saharan Africa and other places, the 
high incidence of disease and malnutri- 
tion among children of the developing 
world, the need for effective airport se- 
curity in the wake of continuing inter- 
national terrorism, the growing 
concerns about drug abuse and drug 
trafficking, and the ever-present threat 
that more countries will develop nu- 
clear weapons, with all of the attendant 
insecurity and tension that will bring to 
the international community. 

In dealing with such sobering prob- 
lems, there is a clear need to work 
steadily to achieve effective interna- 
tional cooperation. That is precisely 
what is happening in the majority of 
the technical and specialized agencies in 
the UN system today. I would not pre- 
tend that those agencies present us 
with no problems. They do. These orga- 
nizations, like the U.S. Government, 
are not perfect. But the work they do 



in regard to these pressing interna- 
tional problems is impressive. I would 
like to touch upon the activities of just 
a few of these agencies to illustrate 
their importance to U.S. national inter- 
ests. It was not by accident — nor with- 
out good reason — that the most recent 
economic summit looked to many of 
these organizations for leadership and 
critical followup on problems requiring 
a multilateral solution. 

The World Health Organization 
(WHO), which led the fight that eradi- 
cated smallpox, is now leading the in- 
ternational effort to coordinate the 
attack on the pandemic of AIDS. It has 
played a major role in development of 
oral rehydration salts, which are used 
to combat diarrheal diseases, and it is 
working to ensure protection of chil- 
dren everywhere against six major 
childhood diseases. The successful com- 
pletion of work on a new vaccine 
against malaria, carried out by WHO in 
cooperation with U.S. Government 
agencies and others, will have revolu- 
tionary social and economic impact 
throughout the world. 

The International Atomic Energy 
Agency (IAEA) serves as the cor- 
nerstone of international efforts to pre- 
vent the further spread of nuclear 
weapons. IAEA serves as the focal 
point for efforts to improve nuclear 
safety practices around the world. Its 
safeguards constitute a unique interna- 
tional system of verification, providing 
essential assurance that nuclear mate- 
rial in peaceful nuclear programs is 
used exclusively for peaceful purposes. 
The United States is required by law to 
apply IAEA safeguards to U.S. nuclear 
exports, which currently total approxi- 
mately $1 billion a year. If, for some 
reason, IAEA were not able to apply 
safeguards, the United States would 
have to either discontinue its nuclear 
exports or initiate a bilateral system of 
safeguards, which would be costly and 
possibly less effective than the current 
safeguards system. Neither approach 
would be beneficial to the U.S. 
taxpayer. 

The International Labor Organi- 
zation (ILO) mirrors to the world the 
U.S. democratic traditions of labor, 
management, and government working 
together. It is strongly supported by 
U.S. labor and employer organizations 
because it has been highly effective in 
setting minimum standards of employ- 
ment for workers all over the world. Its 
work in the area of human and workers' 
rights is a role that was endorsed by 



11988 



81 



UNITED NATIONS 



the Senate just in the past few weeks 
as it agreed to the ratification of two 
key ILO conventions. 

The World Meteorological Organi- 
zation (WMO) has pioneered new 
efforts to forecast the weather and to 
bring these benefits, not only to farm- 
ers around the world but also to com- 
munities everywhere. Its work is 
essential to aviation, shipping, and ag- 
riculture, as well as to storm detection 
and warnings. 

The Food and Agriculture Organi- 
zation (FAO) and its related agencies 
are helping the world come to grips 
with food shortages and drought and to 
eradicate pests and animal diseases. Its 
fisheries and forests programs are of 
great importance to the U.S. private 
sector, and the work it does with WHO 
in setting international food standards 
is of great value to U.S. food 
industries. 

The International Civil Aviation 
Organization (ICAO) promotes safety 
in air navigation by setting up com- 
monly accepted standards for radio 
transmission, landing systems, and 
communication. Its pioneer work in 
combatting international terrorism has 
led to creation of new procedures for 
dealing with airplane hijackings, bomb- 
ings, and attacks on airports. ICAO 
continues to serve the international 
community by facilitating discussion of 
the outrageous bombings by North 
Korea of Korean Air Lines Flight 858. 
Similarly, the International Mar- 
itime Organization (IMO) is promot- 
ing, through a new convention, 
safeguards against terrorism at sea, 
such as the vicious attack on the pas- 
sengers of the cruise ship Achille 
Lauro, which resulted in the murder of 
a U.S. citizen (Leon Klinghoffer). 

The UN Industrial Development 
Organization (UNIDO) encourages 
private sector emphasis in the develop- 
ing nations. This approach, in turn, 
stimulates the local economy and leads 
to increased markets for U.S. goods 
and services. UNIDO also promotes 
other goals pursued by the United 
States — most notably, focus on small 
enterprise and rural development in the 
Third World. 

I could go on, because there are 
many agencies in the UN system which 
make vital contributions to America's 
national interests and to U.S. foreign 
policy. One of my purposes as Assistant 
Secretary will be to bring increased in- 
formation about the work of these 
agencies to the Congress and to the 
American people. We cannot let their 



work go uncriticized, and I intend to 
remain vigilant. But, our policy toward 
them needs to be constructive and sup- 
portive. I hope the Congress will assist 
in this effort. 

Movement for Change 

Let me now turn to the efforts under- 
taken by this Administration, in con- 
cert with the Congress, to bring about 
improvements in decisionmaking pro- 
cedures on budgetary issues. The rele- 
vant legislation — that is, the 
Kassebaum-Solomon amendment and 
the modifications included in the State 
Department authorization bill adopted 
at the end of 1987— focused on these 
processes. The recent authorization leg- 
islation says that no payment of an as- 
sessed contribution can be made to any 
specialized agency if the payment would 
cause the U.S. share to exceed 20% of 
the budget, unless the President deter- 
mines and reports to the Congress that 
the agency has made substantial prog- 
ress toward the adoption and imple- 
mentation of decisionmaking procedures 
on budgetary matters in a manner that 
substantially achieves the goal of 
greater financial responsibihty. 

On the surface, the standard voting 
system in the UN agencies is one na- 
tion-one vote. But, in fact, the major 
donors have substantial influence in the 
UN's technical organizations. We and 
the other major contributors are most 
outspoken on matters of budgetary con- 
cern. Indeed, representatives of the 
U.S. Government often are so out- 
spoken that representatives of some of 
the agencies accuse us of being able to 
exert undue influence over their work 
simply because we are responsible for 
such a large portion of the budget. On 
programmatic matters, U.S. expertise 
on technical issues such as health, the 
environment, agriculture, labor law, 
copyrights, weather research, nuclear 
energy, aviation or maritime affairs, 
just to give a few examples, is so per- 
vasive and outstanding that we provide 
leadership in developing these pro- 
grams. The United States exerts a ma- 
jor influence in shaping the direction 
and activities of these organizations, re- 
gardless of the one country-one vote 
situatior 

In response to the Kassebaum-Sol- 
omon amendment, the United States 
pursued this financial issue first in the 
United Nations and achieved what ap- 
peared to be a promising victory in late 
1986 — the prospect of major decisions 
on budgetary questions reached in a 



relatively small committee, by cons 
sus. President Reagan issued a stai 
ment commending the United Nati 
for this constructive action. Follow 
implementation of the major refom 
New York will be addressed in moi 
detail at the congressional hearing 
February 25. 

In the specialized agencies, wi 
the exception of FAO, there has be 
positive response to U.S. requests 
reform. In fact, some of the agenci 
such as the International Civil Avi 
Organization — already had in place 
sensus-based decisionmaking pro 
cedures that exceeded even the 
standards of the agreement approv 
by the UN General Assembly. If v 
look at them one by one, the resul 
reform in the technical and special 
agencies of the United Nations are 
follows. 

• The World Health Organiza 

executive board in January 1987, ji 
months after the UN General Asst 
decision, adopted its own resolutic 
"cooperation in program budgeting 
This resolution asked each of the "* 
governing body units to work towj 
consensus in reaching conclusions 
budget proposals. This commitmei 
eluded even the 31-member execut 
board, which has the most signific 
impact on budget review. 

The revised WHO procedure 
help to solidify the longstanding o 
satisfaction of the United States v 
the who's administration and ma 
ment. WHO staff have been open, 
erative, and responsive to U.S. 
interests. Our delegations have ofl 
held up WHO as a model for emul 
by other UN-system agencies at t 
same time we have praised WHO ] 
grams that promote primary healt 
care and coordinate the internatioi 
effort against AIDS. The revised ( 
sionmaking system is now in opert 
In June 1987, the WHO Program ( 
mittee agreed on a planning ceilin) 
the 1990-91 program budget. And, 
ing 1988, the regional committees 
the program committee will be de^M 
ing consensus proposals on the ne: ' ' 
budget and working out other moc" 
nisms to ensure more effective ai 
cient operations. 

• At the International Labor r- 

ganization, the conference in 1987 
adopted a key reform measure tha pi 
vides an additional consultative stt.f 
the review of main program option |ai 
resource parameters in off-budget 
years. Like the WHO procedures, ^i 
approach will facilitate developmerjo 



82 



Department of State B'l 



UNITED NATIONS 



- - at a key point in the budget 
lit process. The new mecha- 
iim- ILO's medium-term plan 
-)itnnial programs and budgets, 
itniifies program priorities for 
Ml and subsequent periods within 
cic lesource levels in real terms. In 

ith the new procedures, the Pro- 
r Finance, and Administrative 
nit t re and the governing body of 
A ) are considering the medium- 
Tpl.in, including the identification 
tfs and a budget ceiling for 
I their meetings this month 

At the International Civil Avia- 
nJrfranization, the United States 
ionally has been a major player in 
iview of the proposed budget. We 
joined the customary consensus 
lave praised ICAO for both its 
financial management and its 
tant contributions to the safety 
ecurity of international civil avia- 
Nevertheless, we promoted adop- 
if a decision at ICAO to ensure 
luation of this consensus-based ap- 
h to budget and financial issues, 
in 1987, the ICAO council re- 
ined the organization's commitment 
e consensus principle, 
would note that, in terms of 
)'s substantive work, both the 
3 and Venice summits endorsed 
)'s action on air traffic and airport 
■ity, which had been pursued de- 
the budgetary constraints on 
). Indeed, these constraints were 
vere that ICAO not only sought to 
^sponsive by lowering assessments 
^87 and 1988 but also found it nec- 
*y to institute a hiring freeze, still 
feet in 1988. The organization also 
usly considered giving notice to a 
ber of staff when severe cash flow 
lems led to uncertainty about 
3's ability to continue paying 
ies. 

• The World Meteorological Orga- 
tion has been responsive to U.S. 
osals for UN budget reform, par- 
arly efforts to provide major do- 
wth more influence in the 
nization. In response to U.S. 
ts to cement into place the normal 
ensus-based decision procedures, 
iVMO secretariat in 1986 — even 
re action was taken by the UN 
;ral Assembly in the fall of that 
— proposed the establishment of a 
ncial Advisory Committee to ad- 
the Secretary General on budget- 
ind financial matters. The WMO 
^ess, meeting in May 1987, ap- 
ed the proposal and created a com- 
ee composed of the eight largest 



contributors (including the United 
States), the president of the executive 
council, and six regional represent- 
atives. The committee, which works by 
consensus, began its work immediately, 
holding its first meetings during the 
1987 session of the WMO Congress. 

The new Financial Advisory Com- 
mittee will consider all WMO budget- 
ary and financial matters when the 
WMO executive council holds its annual 
meeting in June 1988. The agenda will 
include recommendations on program 
expenditures for 1989, which must be 
within the overall 4-year budget ceiling 
established by the 1987 Congress. 

• The UN Industrial Development 
Organization was created in 1966 to ac- 
celerate the process of industrialization 
in developing countries. It became a 
specialized agency of the UN system 
only recently, on January 1, 1986. The 
constitution and rules of procedure for 
the newest specialized agency, including 
many of the provisions that we are now 
discussing, were developed with major 
input from the U.S. Government. They 
already permit significant input by ma- 
jor contributors. To supplement that in- 
put, the general conference in 1987 
adopted by consensus a decision on im- 
provements in the program budget 
process, following up on a proposal ini- 
tiated by the U.S. delegation to the 
Program Budget Committee meeting in 
March 1987. 

Among the results during 1986 and 
1987, its first 2 years of operation, 
UNIDO has reduced staff; cut some 
programs and increased others, consist- 
ent with U.S. priorities and interests; 
adopted budget reforms urged by the 
United States; and achieved negative 
real growth in the budget. We still have 
problems with the orientation of some 
UNIDO program activity, but the oper- 
ation of consensus-based decisionmak- 
ing on financial issues is coming along 
well. 

• Of the major technical agencies in 
the system, the Food and Agriculture 
Organization is the one that has not 
responded well to longstanding calls for 
reform from the majority of its largest 
donors, including the United States. 
For some time, the United States and 
other FAO member states have been 
asking for revisions in budget presenta- 
tions in order to obtain a clearer view 
of proposed or actual expenditures. 
However, the secretariat has refused to 
comply fully. 

Specific reform proposals were 
made in 1986 and 1987 and rebuffed. 
For example, the U.S. delegation to the 
FAO council in June 1987 was ruled out 



of order because we proposed discus- 
sion of needed decisions on reform in 
the organization. At the FAO confer- 
ence in November 1987, the United 
States introduced a budget reform reso- 
lution, supported by other major con- 
tributors. But the conference voted 
overwhelmingly against the U.S. reso- 
lution. It also rejected overwhelmingly 
the reform proposals put forward by 
the Nordic nations, the United King- 
dom, Canada, Australia, Japan, New 
Zealand, the Netherlands, the Federal 
Republic of Germany, and others. Rep- 
resentatives of 12 major donor member 
states of FAO (the so-called Camberley 
Group, named for the group's first 
meeting place) met in Helsinki in early 
February and reaffirmed their commit- 
ment to pursue reform in the FAO. 

The likely result of the situation to 
date is that the President will not be 
able to provide for FAO the determina- 
tion required in the recently revised 
Kassebaum-Solomon legislation. Nor 
can the FAO rank high among the 46 
organizations in the CIO account, based 
on the criteria for distribution of scarce 
funds indicated by the Congress. We 
have, therefore, proposed that the 
funds for FAO be set aside in the hope 
that the FAO will make progress on 
reform in the near future. We are con- 
tinuing longstanding efforts to work 
with other FAO member states and the 
FAO secretariat to help assure that 
FAO serves the needs of those who re- 
quire assistance most, the hungry and 
malnourished in developing nations. 
The United States, as demonstrated by 
the magnitude and range of its contri- 
butions in this regard, is strongly com- 
mitted to reducing the needless tragedy 
that afflicts countless millions in the de- 
veloping nations. 

In sum, I would argue that, in the 
majority of the UN technical agencies, 
we have achieved the goal set by the 
Congress. That is, we have ensured 
that the major donors, especially the 
United States, have significant influ- 
ence over budgetary and administrative 
questions. My intention, as I take over 
the reins as Assistant Secretary, is to 
maintain the momentum that has been 
established and to ensure that the new 
procedures put into place actually 
work. 

Specifically, for this year, I will 
urge that U.S. delegations to meetings 
of UN organizations do the following: 

• Continue to ensure that key 
budget decisions are taken by 
"consensus," at least in the fora subor- 



1988 



83 



UNITED NATIONS 



dinate to the chief governing bodies 
where there is a clear right to a vote; 

• Continue to ensure "major do- 
nor" (i.e., U.S. Government) represen- 
tation on the key committees in the 
budget process; 

• Continue to work to ensure 
establishment of ceilings for develop- 
ment of the next budget, possibly with 
subceilings for subsidiary parts; 

• Work to create new committee 
mechanisms to serve these purposes if 
the existing ones are not effective or 
cannot be modified adequately; 

• Develop procedures for item-by- 
item review and decisionmaking on the 
components of budgets, rather than 
have delegations forced to deal with an 
entire budget package; 

• Continue to use mechanisms, or 
to develop new mechanisms as needed, 
to require the organizations, which now 
make their own internal decisions on 
the creation of new program activities 
and the elimination or curtailment of 
old ones, to present decisions on pri- 
orities to a representative group of 
member states for review or revision; 

• Reinforce efforts to make secre- 
tariat operations more transparent, 
where this appears necessary, in order 
to let member states have a clearer un- 
derstanding of the real components of a 
budget proposal and on activities actu- 
ally pursued during the preceding cycle 
(perhaps encouraging the establishment 
of new member-state evaluative mech- 
anisms); and 

• Ensure that U.S. Government 
domestic agencies, and others involved 
in the substantive operations of the UN 
organizations, join officials at the De- 
partment of State in renewed efforts to 
evaluate the work of the UN organiza- 
tions, so that we can make more con- 
crete proposals for reducing, 
eliminating, or expanding specific ac- 
tivities or for starting new ones. 

All of these steps are possible, as 
they always have been. U.S. represen- 
tatives to the UN's technical and spe- 
cialized agencies have always advocated 
improved efficiency and effectiveness. 
There is no reason not to continue pur- 
suing these goals. Indeed, there are 
important reasons, given the prospect 
for the foreseeable future of too few 
resources to meet seemingly unlimited 
needs, to press on with vigor in behalf 
of setting priorities more thoughtfully, 
employing budgetary discipline, and 
planning ahead. 

I understand that the purpose of 
the legislation of recent years was to 
help assure that the United States has 
major influence on important deisions 



within the UN system, including those 
made within the technical agencies. 
Now, by and large, we have done that. 
The opportunity before us now is to 
take advantage of the enhanced influ- 
ence that we have in order to promote 
the substantive, technical program ac- 
tivities that we believe are in the best 
interests of the agencies themselves — 
and, most fundamentally, in the best 
interests of U.S. taxpayers. 

Allocation of Resources 

As you know, from the account for Con- 
tributions to International Organiza- 
tions — we pay the assessed contribution 
for the United States to 46 different 
international organizations. Only one of 
those 46 organizations is the United 
Nations. The United Nations — ob- 
viously the biggest of the agencies — 
accounts for about 34% of the require- 
ment for U.S. contributions. The other 
66% goes to the UN's technical agen- 
cies, as well as to other important or- 
ganizations such as NATO [North 
Atlantic Treaty Organization], the 
OECD [Organization of Economic Coop- 
eration and Development], and GATT 
[General Agreement of Tariffs and 
Trade]. 

But when the overall appropriation 
falls below the total requirement for 
U.S. assessments — as it has for the 
past 3 years — a serious blow falls on 
the entire account, including the UN's 
technical and specialized agencies. In 
FY 1988, the appropriation covered 84% 
of the request ($480 million out of $571 
million), which was a substantial in- 
crease over that of the previous year, 
but it still left many of the specialized 
organizations hurting. 

The question for all of us, Congress 
and Administration alike, is how we 
make payments to these organizations 
when the appropriations are not suffi- 
cient to meet the total requirements. 
As you know, the Appropriations Con- 
ference Committee Report (for the FY 
1988 continuing resolution — PL 
100-202) asked the Department of State 
to evaluate international organizations 
objectively, utilizing five specific fac- 
tors, in order to rationalize the deci- 
sions made by the Department in 
making payment of assessed contribu- 
tions to these 46 organizations. 

We have sought to establish a disci- 
plined set of criteria for use in assign- 
ing funding priorities. The criteria that 
were developed included the following: 

• The level of direct benefit or sub- 
stantive importance of the agency's 
work to the United States in political, 
strategic, or economic terms; 



• The extent to which the agen •'"' 
has achieved program budget refon "P 
an effective budget process; 

• The quality of the agency's re 
source management, including final * 
and personnel resources; 

• Importance of current politic! 
and operational factors, such as ke; 
elections, Soviet influence, or place 
ment of Americans in key positions 

• The level of domestic U.S. su 
port for the organization and/or its 
programs; 

• The possible negative impact 
U.S. interests and on the organizat 
should there be shortages in U.S. 1 
ing; and 

• Organization performance in 
fillment of its chartered mission. 

The first decision was to pay ir 
the U.S. assessments to the 30 sm: 
organizations in the account. These 
highly specialized and generally efl 
tive bodies requiring relatively smt 
contributions. Their total requirem 
were $8.6 million for FY 1988. Non 
was above $1 million, and most wer 
well below it. 

The next step was to apply th( 
teria I have just described to the r 
maining 16 agencies in the account 
which receive 98.5% of the appropi 
tion. These were the UN, OECD, 
NATO, GATT, WHO, FAO, ILO, "W 
IAEA, UNIDO, ICAO, OAS 
[Organization of American States], 
PAHO [Pan American Health Orga 
tion], IICA [Inter-American Institi 
for Cooperation on Agriculture], IT 
[International Telecommunications 
Union], and CCC [Customs Coopei 
tion Council]. 

As a result of careful study of 
criteria, by the Department of Sta( 
and other interested U.S. Governn A 
agencies, these 16 agencies were pi « 
in four clusters, with each agency 
each cluster to receive approximat 
the same percentage of the U.S. ;i 
sessment. For example, the WHO 
the IAEA will receive 100% fundin 
and the United Nations will receiv( ; 
75%. 

The results of this clustering »■ 
else form the basis for the reprogr: 
ming letter that is being sent forw; ^ i 
by the Department. It is, of course ^ 
unfortunate that we cannot fund in ill 
all of the organizations that we beli > 
are serving us well, particularly c<i u- 
ering the treaty obligations that atipd 
our membership in each of them. B ,, 
in the circumstances, we believe th 
outcome is both reasonable and fairW 
hope that the Congress will be sup)lrt 
ive of our approach, which was in f;t 



84 



Department of State Bulrti 

J. 



WESTERN HEMISPHERE 



ated by the criteria suggested by 
mgress. 

suspect that the committee might 
sk why it is that the Administra- 
as not requested funds for FY 
ufficient to meet total require- 
. This is a legitimate question, 
ularly given my generally favor- 
ttitude toward the UN's technical 
ies and my concern that they may 
maged by the shortfall in overall 
priations for the CIO account, 
'he financing question will, of 
e, be discussed before the appro- 
o'ns committees in the coming 
;. But it can be noted now that 
Dtal of U.S. requirements for fund- 
om the FY 1989 budget is $657 
n. The President's budget re- 
s $490 million, creating a shortfall 
7 million. That shortfall will inev- 
• have a negative impact on the 
technical agencies, 
'he reason for the President's budg- 
juest, quite simply, is the agree- 
at the budget summit that 
red at the end of 1987. It was an 
ment between the Administration 
he Congress that, in order to 
ve the Gramm-Rudman-Hollings 
gs, overall FY 1989 requests 
1 be no more than 2% over the FY 
levels. Our FY 1989 request of 
million for CIO account— 2% over 
2vel approved for FY 1988— is in 
vith this agreement. We are now 
e process of applying the same cri- 
-based approach used to allocate 
988 funds for distribution of FY 
funds. 

:lusion 

36 that this review has been helpful 
acing the UN's technical and spe- 
2ed agencies in the context of the 
all UN system. My experience— 
d primarily upon my work as Am- 
ador to the United Nations Agen- 
in Vienna— is that the technical 
licies are often misunderstood in the 
'Jied States, and too often caught up 
Questions about the New York-based 
Bted Nations. This is unfortunate. 
^''ir work in health, agriculture, avia- 
'•^ safety, nuclear energy safeguards, 
''! many other areas is vital to this 
ntry and to our policy affecting the 
, of the world, in particular the de- 
- )ping nations. How the U.S. Govern- 
*' it treats those agencies is worthy of 
'" deepest consideration. 

Ai 'The complete transcript of the hear- 
i will be published by the committee 
will be available from the Supenntend- 
of Documents, U.S. Government Print- 
Office, Washington, DC 20402. ■ 



eiil 1988 



Panama 



DEPARTMENT STATEMENT, 
FEB. 12, 19881 

Our relations with Panama are com- 
plex, encompassing not only the close 
personal and cultural ties we share 
with all the nations of the hemisphere 
and our active economic, business, and 
military relationships there but also the 
historic and strategic dimension of the 
Panama Canal and our unique treaty 
relationship. 

In recent years, our relations with 
Panama have become seriously strained 
because of the failure of Gen. Noriega 
to move Panama toward a more demo- 
cratic system of government and be- 
cause of persistent reports of his 
involvement in narcotics trafficking and 
other corruption. Nevertheless during 
this period, Panama and the United 
States have cooperated successfully in 
joint administration of the canal, efforts 
to halt regional drug trafficking, and 
other bilateral and multilateral areas. 

In spite of numerous allegations of 
illegal activity by Gen. Noriega, the 
Department of Justice has determined 
until lately that there was not sufficient 
evidence to indict Gen. Noriega. When 
new evidence recently came to hght. 



Aid to Nicaragua 



WHITE HOUSE STATEMENT, 
JAN. 19, 1988' 

The President today made the deter- 
mination and certification under Section 
111(b)(2)(A) of the fiscal year 1988 con- 
tinuing resolution (PL 100-202) that 
permits resumption of transportation of 
military assistance to the Nicaraguan 
democratic resistance authonzed by the 
Congress. . 

Section 111 of the continuing resolu- 
tion provided for suspension of trans- 
portation of military assistance to the 
resistance on January 12, 1988, and for 
resumption of such assistance after Jan- 
uary 18, 1988, if the President deter- 
mined and certified to the Congress 
that: 

• No cease-fire is in place that was 
agreed to by the Government of Nic- 
aragua and the Nicaraguan democratic 
resistance; 

• The failure to achieve such a 
cease-fire results from the lack of good 



the Department of Justice successfully 
sought indictments by grand juries in 
Florida. Although law enforcement 
matters proceed independently of for- 
eign policy matters, this action by the 
Justice Department had the full sup- 
port of all foreign affairs agencies. As a 
matter of policy, we do not make sub- 
stantive comment on pending criminal 
cases. 

Our policy remains unchanged, we 
remain firmly committed to democracy 
and constitutional rule of law in Pan- 
ama. We have repeatedly stated our 
view of the need for a Panamanian solu- 
tion to its internal political problems— a 
process best achieved by dialogue and 
negotiation. We recognize that what- 
ever solution emerges must make a 
place for all elements of Panamanian so- 
ciety, including the Panamanian defense 
forces. We look to maintain bilateral re- 
lations with the Government of Pan- 
ama as we continue to fulfill our treaty 
responsibilities and try to help Panama 
emerge from its present difficulties. 

iRead to news correspondents by De- 
partment deputy spokesman Phyllis 
Oakley. ■ 



faith efforts by the Government of Nic- 
aragua to achieve such a cease-fire; and 

• The Nicaraguan democratic re- 
sistance has engaged in good faith 
efforts to achieve such a cease-fire. 

The President's determination was 
based on the Secretary of State's find- 
ings, set forth in his January 18, 1988, 
report, that the conditions for resuming 
assistance to the resistance have been 

met. , , 

The Sandinistas have a record, be- 
ginning writh promises to the Organiza- 
tion of American States in 1979 and 
continuing through the Guatemala ac- 
cord of August 7, 1987, of making 
promises of democracy and freedom 
that they do not keep. After the Cen- 
tral American Presidents summit meet- 
ing this past weekend in San Jose, 
Costa Rica, the Nicaraguan President 
issued yet more promises. That very 
weekend, the Sandinistas' internal se- 
curity forces executed a wave of arrests 
and interrogations of leading members 



85 



WESTERN HEMISPHERE 



f 



of the surviving democratic political el- 
ements in Nicaragua. Moreover, while 
the Nicaraguan President demands uni- 
lateral termination of support for the 
forces of freedom in Nicaragua, the 
massive flow to the Sandinistas of So- 
viet-bloc arms continues unabated. 

The United States remains fully 
committed to the achievement of de- 
mocracy in Nicaragua and security in 
all of Central America as the essential 
conditions for a just and lasting peace 
in the region. The events which have 
unfolded since the signing of the Guate- 
mala accord on August 7, 1987, have 
demonstrated once again that a strong 
Nicaraguan democratic resistance re- 
mains essential to the achievement of 
those conditions. 



WHITE HOUSE STATEMENT, 
JAN. 27, 19882 

• The President today submitted a 
request to the Congress pursuant to 
Section 111 of the fiscal year 1988 con- 
tinuing resolution (PL 100-202) for 
$36.25 million of additional aid for the 
Nicaraguan democratic resistance 
(NDR) to sustain the resistance. The 
request ensures that the resistance can 
continue the pressure on the Sandinista 
regime to comply with its obligations 
under the Guatemala accord of August 
7, 1987, to bring democracy to 
Nicaragua. 

All funds under the request are de- 
rived by transfer from existing defense 
appropriations. Ninety percent of the 
funds requested provided nonlethal aid, 
such as food, clothing, medicines, and 
the means to deliver it. Ten percent 
provides for Redeye air defense mis- 
siles, for use against the Sandinistas' 
Soviet-made Hind helicopter gunships 
and ammunition. 

The request prohibits the purchase 
of aircraft to transport aid to the re- 
sistance, but permits leasing aircraft. 
To ensure the availability of leased air- 
craft, the request authorizes the Presi- 
dent to transfer not more than $20 
million from defense appropriations to 
indemnify the owners of leased aircraft 
in the event of loss, but which will oth- 
erwise not be spent. The request also 
provides for electronic equipment, 
radar, and other passive air defense 
equipment to protect the safety of 
transportation. 

The request supports the Central 
American peace process by providing a 
clear opportunity for the Sandinista re- 



gime to comply with its obligation to 
establish democracy and to negotiate a 
cease-fire directly with the resistance. 
The request prohibits delivery of all le- 
thal aid after February 29, 1988, which 
is the date on which current authority 
to deliver lethal aid expires. There- 
after, delivery of lethal aid may begin 
only if, after March 31, 1988, the Presi- 
dent certifies to the Congress that (A) 
there is no cease-fire in place between 
the Government of Nicaragua and the 
resistance, (B) that Nicaragua has not 
met its obligations to comply with the 
requirements of the declaration of the 



Presidents of the Central American 
tions at San Jose, Costa Rica, on Ja (fS 
ary 16, 1988, and (C) that the resist 
has negotiated in good faith. 

The Congress will consider a ji 
resolution to approve the President 
quest under expedited procedures t,' 
provide for a vote in the House of F 
resentatives on February 3 and a \-< 
in the Senate on February 4. I. 

t 



'Text from Weekly Compilation of 
Presidential Documents of Jan. 25, 198' 

'Text from Weekly Compilation of 
Presidential Documents of Feb. 1, 198J 



Central American Peace Process 



WHITE HOUSE STATEMENT, 
JAN. 19, 1988' 

President Reagan believes that the out- 
come of the January 15 summit meeting 
of the Central American presidents 
presents important opportunities to 
further peace and democracy in this 
troubled region. 

At the San Jose summit, there was 
a clear consensus among the four Cen- 
tral American democratic presidents 
that the Sandinistas had not complied 
with the peace accord. By making his 
last minute promises, President 
[Daniel] Ortega implicitly acknowl- 
edged the accuracy of that judgment. 

The Guatemala City plan aims at 
peace and democracy for all of Central 
America. Its objectives, in combination 
with the pressures from the Central 
American democracies and the Nic- 
araguan democratic resistance, have 
prompted the Sandinistas to reluctantly 
promise to diminish their tight control 
over the Nicaraguan political system 
and to provide a glimmer of hope to the 
Nicaraguan people that democracy and 
freedom may eventually be established. 

The key issue is whether Daniel 
Ortega is really committed to genuine 



democracy or just seeks the elimini 
of the Nicaraguan democratic re- 
sistance. The Sandinistas' track rec 
is clear and must be considered in 
uating the latest Sandinista offer. T 
is a need for openmindedness and 1 
along with skepticism. We welcome 
new promises, but note that while 
Daniel Ortega was in Costa Rica n- 
ing them, his government was arre 
prominent democratic leaders insid 
Nicaragua. 

The focus is where it belongs: 
the Sandinistas — their promises an 
their actions. The President believi 
that continued support for the Nic- 
araguan democratic resistance will 
the pressure on the Sandinistas to 
forward with genuine and enduring 
democratic reforms. The Nicaragu; 
democratic resistance is the best ir 
ance policy for keeping the peace p 
ess on track and producing a 
democratic outcome in Nicaragua, 
is not the time to falter in our sup| 
for the freedom fighters. 



'Text from Weekly Compilation of 
Presidential Documents of Jan. 25, \9i 



86 



Department of State Bustii 



ATIES 



irent Actions 



ILATERAL 



;tica 

mendations relating to the fur- 
ce of the principles and objectives of 
itarctic treaty (TIAS 4780). Done at 
beton Nov. 10, 1972. Entered into 
eMay 29, 1975, for recommendations 
-through VII-3 and VII-6 through 

- June 24, 1981, for recommendations 

- ami VII-9. 

i at inn of approval : U.K., Feb. 10, 
; ())■ ri'commendation VII-5. 
£ ■(! into force : Feb. 10, 1988, for rec- 
-idatKin VII-5. 

( nit'iiilations relating to the fur- 
■ cc uf the principles and objectives of 
.Itarctic treaty (TIAS 4780). Done at 
'Is Oct. 18, 1985.' 

:ation of approval : Uruguay, Dec. 29, 
lapan, Dec. 25, 1987, except for rec- 
fidations XIII-10 through XIII-13. 

on. Civil 

ntion for the suppression of unlawful 
e of aircraft. Done at The Hague 
6, 1970. Entered into force Oct. 14, 
riAS 7192. 
sion deposited : Maldives, Sept. 1, 

ntion for the suppression of unlawful 
gainst the safety of civil aviation, 
at Montreal Sept. 23, 1971. Entered 
irce Jan. 26, 1973. TIAS 7570. 
sion deposited : Maldives, Sept. 1, 



Is 

col to the treaty concerning the per- 
nt neutrality and operation of the 
na Canal (TIAS 10029). Done at 
ington Sept. 7, 1977. Enters into 
for each state at the time of deposit 
instrument of accession. 
ssions deposited : Barbados, Sept. 14, 
Germany, Fed. Rep., Feb. 9, 1988.2 

ne Pollution 

ention on the prevention of marine 
tion by dumping of wastes and other 
;r, with annexes. Done at London, 
;o City, Moscow, and Washington Dec. 
)72. Entered into force Aug. 30, 1975. 
1 8165. 
ssion deposited : Ivory Coast, Oct. 9, 

idments to the convention of Dec. 29, 
on the prevention of marine pollution 
imping of wastes and other matter 
S 8165). Done at London Oct. 12, 
1 

ptance deposited : Switzerland, Dec. 

)87. 



International convention relating to inter- 
vention on the high seas in cases of oil 
pollution casualties, with annex. Done at 
Brussels Nov. 29, 1969. Entered into force 
May 6, 1975. TIAS 8068. 
Ratification deposited : Switzerland, Dec. 
15, 1987. 

International convention on civil liability 

for oil pollution damage. Done at Brussels 

Nov. 29, 1969. Entered into force June 19, 

1975.3 

Ratification deposited : Switzerland, Dec. 

15, 1987. 

Protocol relating to intervention on the 
high seas in cases of pollution by sub- 
stances other than oil. Done at London 
Nov. 2, 1973. Entered into force Mar. 30, 
1983. TIAS 10561. 

Accession deposited : Switzerland, Dec. 15, 
1987. 

Annex V to the international convention 
for the prevention of pollution from ships, 
1973: regulations for the prevention of pol- 
lution by garbage from ships. Done at Lon- 
don Nov. 2, 1973. 
Enters into force : Dec. 31, 1988. 

Maritime Matters 

International convention on load lines, 
1966. Done at London, Apr. 5, 1966. En- 
tered into force July 21, 1968. TIAS 6331, 
6629. 

Amendments to the international conven- 
tion on load lines, 1966. Adopted at London 
Oct. 12, 1971.1 

Accessions deposited : Burma, Nov. 11, 
1987. 

Amendments to the international conven- 
tion on load lines, 1966. Adopted at London 
Nov. 12, 1975.' 
Acceptance deposited : Switzerland, Dec. 

15, 1987. 

Convention on the international regulations 
for preventing collisions at sea, with reg- 
ulations. Done at London Oct. 20, 1972. 
Entered into force July 15, 1977. TIAS 
8587. 
Accession deposited : Burma, Nov. 11, 1987. 

International convention for the safety of 
life at sea, 1974, with annex. Done at Lon- 
don Nov. 1, 1974. Entered into force May 
25, 1980. TIAS 9700. 

Protocol of 1978 relating to the interna- 
tional convention for the safety of life at 
sea (TIAS 9700). Done at London Feb. 17, 
1978. Entered into force May 1, 1981. TIAS 
10009. 

Accessions deposited : Burma, Nov. 11, 
1987. 

International convention on standards of 
training, certification, and watchkeeping 
for seafarers, 1978. Done at London July 7, 
1978. Entered into force Apr. 28, 1984.^ 
Accession deposited : Canada, Nov. 6, 1987* 
Ratification deposited : Switzerland, Dec. 
15, 1987. 



International convention on maritime 

search and rescue, 1979, with annex. Done 

at Hamburg Apr. 27, 1979. Entered into 

force June 22, 1985. 

Accession deposited : Uruguay, Dec. 15, 

1987. 

Migration 

Amendments to the constitution of the in- 
tergovernmental committee for migration 
of Oct. 19, 1953 (TIAS 3197). Adopted at 
Geneva May 20, 1987. Enters into force 
upon acceptance by two-thirds of the mem- 
ber states or as further provided in Art. 
30(2).' 
Acceptance deposited : U.S., Feb. 19, 1988. 

Patents — Microorganisms 

Budapest treaty on the international recog- 
nition of the deposit of microorganisms for 
the purposes of patent procedure, with 
regulations. Done at Budapest Apr. 28, 
1977. Entered into force Aug. 19, 1980. 
TIAS 9768. 

Accession deposited : Korea, Rep. of, Dee. 
28, 1987. 

Pollution 

Montreal protocol on substances that de- 
plete the ozone layer with annex. Done at 
Montreal Sept. 16, 1987.' [Senate] Treaty 
Doc. 100-10. 

Signatures : Greece, Oct. 29, 1987; Belorus- 
sian S.S.R., Jan, 22, 1988; Ukrainian 
S.S.R., Feb. 18, 1988; U.S.S.R., Dec. 29, 
1987. 

Prisoner Transfer 

Convention on the transfer of sentenced 
persons. Done at Strasbourg Mar. 21, 1983. 
Entered into force July 1, 1985. TIAS 
10824. 

Ratifications deposited : Greece, Dec. 17, 
1987;5 Switzerland, Jan. 15, 1988.^ 
Territorial application : Extended to Faroe 
Islands by Denmark, with effect May 1, 
1988. 

Terrorism 

International convention against the taking 
of hostages. Done at New York Dec. 17, 
1979. Entered into force June 3, 1983; for 
the U.S. Jan. 6, 1985. 
Accession deposited : Czechoslovakia, Jan. 
27, 1988. 

Trade 

UN convention on contracts for the inter- 
national sale of goods. Done at Vienna Apr. 
11, 1980. Entered into force Jan. 1, 1988. 
[52 Fed. Reg. 6262] 
Proclaimed by the President : Feb. 11, 1988. 

Protocol of provisional application of the 
General Agreement on Tariffs and Trade. 
Concluded at Geneva Oct. 30, 1947. En- 
tered into force Jan. 1, 1948. TIAS 1700. 
Contracting party status accorded : 
Lesotho, Jan. 8, 1988. 



1988 



87 



TREATIES 



Protocol amending the agreement of Apr. 
12, 1979, on government procurement 
(TIAS 10403). Done at Geneva Feb. 2, 1987. 
Entered into force : Feb. 14, 1988. 

Whaling 

International whaling convention and 
schedule of whaling regulations. Done at 
Washington Dec. 2, 1946. Entered into 
force Nov. 10, 1948. TIAS 1849. 
Notification of withdrawal : Belize, Dec. 30, 
1987, effective June 30, 1988. 

Wheat 

Wheat trade convention, 1986. Done at 
London Mar 14, 1986. Entered into force 
July 1, 1986. [Senate] Treaty Doc. 100-1. 

Food aid convention, 1986. Done at London 
Mar. 13, 1986. Entered into force July 1, 
1986. [Senate] Treaty Doc. 100-1. 
Ratification deposited : U.S., Jan. 27, 1988. 
Definitive entry into force for the U.S. : 
Jan. 27, 1988. 



BILATERAL 

Argentina 

Memorandum of understanding on the ex- 
change of officers between the U.S. Marine 
Corps and the Argentine Marine Corps. 
Signed at Washington Oct. 7 and Dec. 3, 
1987. Entered into force Dec. 3, 1987. 

Canada 

Agreement extending the agreement of 
Aug. 25, 1982 (TIAS 10456), respecting co- 
operation in radioactive waste manage- 
ment. Effected by exchange of letters at 
Washington and Pinawa May 29 and June 
25, 1987. Entered into force June 25, 1987. 

Arrangement in the area of natural gas hy- 
drates research and development. Signed 
at Ottawa and Washington Dec. 11, 1987, 
and Feb. 16, 1988. Entered into force Feb. 
16, 1988. 

Treaty on mutual legal assistance in crimi- 
nal matters, with annex. Signed at Quebec 
Mar. 18, 1985.' [Senate] Treaty Doc. 100-14. 
Transmitted to Senate : Feb. 22, 1988. 

Dominican Republic 

Agreement for sales of agricultural com- 
modities, with memorandum of under- 
standing. Signed at Santo Domingo June 
30, 1987. Enters into force upon an ex- 
change of notes indicating that internal 
procedures of both countries have been 
completed. 

Agreement amending special access agree- 
ment of Dec. 18, 1986, relating to trade in 
certain textiles and textile products. Ef- 
fected by exchange of notes at Santo 
Domingo Oct. 19 and Dec. 16, 1987. En- 
tered into force Dec. 16, 1987. 



Agreement amending special access agree- 
ment of Dec. 18, 1986, as amended, and 
agreement of Dec. 30, 1983, as amended, 
relating to trade in certain textiles and 
textile products. Effected by exchange of 
notes at Santo Domingo Dec. 15 and 17, 
1987. Entered into force Dec. 17, 1987. 

Egypt 

Agreement regarding the consolidation and 
rescheduling of certain debts owed to, 
guaranteed by, or insured by the U.S. Gov- 
ernment and its agencies, with annexes 
and related letter Signed at Cairo Nov. 14, 
1987. Entered into force Feb. 22, 1988. 

Grant agreement for commodity imports. 
Signed at Cairo Feb. 9, 1988. Entered into 
force Feb. 9, 1988. 

El Salvador 

Agreement concerning relief from double 
taxation on income derived from operation 
of aircraft. Effected by exchange of notes 
at San Salvador, Dec. 17, 1987. Entered 
into force Dec. 17, 1987. 

Germany, Federal Republic of 

Agreement extending the agreement of 
June 8, 1976 (TIAS 8657), as extended, in 
the field of liquid metal-cooled fast breeder 
reactors. Effected by exchange of letters 
at Bonn and Washington Dec. 15 and 31, 

1987. Entered into force Dec. 31, 1987. 

Supplementary agreements amending the 
agreement on social security of Jan. 7, 
1976, and the administrative agreement of 
June 21, 1978 (TIAS 9542). Signed at Wash- 
ington Oct. 2, 1986. 
Entered into force : Mar 1, 1988. 

Guinea-Bissau 

Agreement relating to the establishment of 
a Peace Corps program. Effected by ex- 
change of notes at Bissau Jan. 12 and 15, 

1988. Entered into force Jan. 15, 1988. 

Japan 

Parcel post agreement, protocol, and de- 
tailed regulations of execution. Signed at 
Tokyo and Washington Oct. 2 and Nov. 3, 
1958. Entered into force Nov. 3, 1958. 
Termination : Notification given by U.S. 
Feb. 1, 1988, effective Aug. 1, 1988. 

Agreement between the U.S. and Japan 
amending and extending the agreement of 
Sept. 10, 1982, concerning fisheries off the 
coasts of the U.S. (TIAS 10480), with 
agreed minutes. Signed at Washington 
Nov. 10. 1987. 
Entered into force : Dec. 31, 1987. 

Agreement extending the agreement of 
May 1, 1980 (TIAS 9760), as extended, on 
cooperation in research and development in 
science and technology. Effected by ex- 
change of notes at Washington Jan. 29, 
1988. Entered into force Jan. 29, 1988; ef- 
fective Feb. 1, 1988. 



.Jill; 



Macao 

Agreement amending agreement of Di 
28, 1983, and Jan. 9, 1984, as amendet 
relating to trade in textiles and textil 
products. Effected by exchange of nol 
Hong Kong and Macao Jan. 8 and 12, 
Entered into force Jan. 12, 1988; effec 
Jan. 1, 1988. 

Madagascar 

Agreement amending the agreement 
June 10, 1987, for sales of agricultura 
modifies. Effected by exchange of noi 
Antananarivo Oct. 23 and 30, 1987. E 
tered into force Oct. 30, 1987. 

Mexico 

Treaty on cooperation for mutual leg! 
sistance. Signed at Mexico Dec. 9, 19 
[Senate] Treaty Doc. 100-13. 
Transmitted to Senate : Feb. 16, 1988. 

Netherlands 

Agreement amending the air transpo 
agreement of Apr 3, 1957, as amende 
(TIAS 4782, 6797, 8998). Effected by 
change of notes at Washington Oct. 1 
Dec. 22, 1987. Entered into force pro 
sionally, Dec. 23, 1987; definitively, o 
date on which the U.S. is informed b 
Netherlands that all necessary interi 
procedures have been completed. 

Agreement on preinspection in respe 
Aruba. Signed at Oranjestad June 16 
Entered into force : Mar. 11, 1988. 

Peru 

Grant agreement for an agricultural 
nology transformation project. Signe 
Lima Sept. 25, 1987. Entered into fo 
Sept. 25, 1987. 

Rwanda 

International express mail agreemen 
detailed regulations. Signed at Kigal 
Washington Jan. 15 and Feb. 8, 1988. 
tered into force Mar. 15, 1988. 

South Africa 

Agreement for cooperation in the de 
ment, building, installation, and ope 
of an integrated, real-time global sei 
data acquisition system. Signed at Pi 
Dec. 1, 1987. Entered into force Dec. 
1987. 

Spain 

Agreement on social security, with a till 
istrative arrangement. Signed at Ma idl 
Sept. 30, 1986. 
Entered into force : Apr. 1, 1988. 

Tanzania | 

International express mail agreemen Iw 
detailed regulations. Signed at Dar eSaj 
laam and Washington Dec. 30, 1987, d 
Jan. 25, 1988. Entered into force FeblSj 
1988. 



88 



Department of State Ellel 



-ftSS RELEASES 



PUBLICATIONS 



fcient regarding the consolidation and 
liiiuling of certain debts owed to, 
ratefcl by, or insured by the U.S. Gov- 
niit and its agencies, with annexes. 
< at Kampala Jan. 13, 1988. Entered 
rvf Feb. 22, 1988. 



. R. 

i (III the elimination of intermediate- 
jand shorter range missiles, with 
■ramlum of understanding and pro- 

! Siu'ned at Washington Dee. 8, 1987.' 
I I IVeaty Doc. 100-11. 
.1 II I lied to the Senate : Jan. 25, 1988. 

II Kingdom 

ij'mentary treaty to the e.xtradition 
i1 of June 8, 1972 (TIAS 8468), with 
e Signed at Washington June 25, 
) Entered into force Dec. 23, 1986. 
c inu'd by the President : Feb. 4, 



lartment of State 



(releases may be obtained from the 
of Press Relations, Department of 
Washington, D.C. 20520. 

Date Subject 

2/1 Shultz: interview on ABC- 
TV's "This Week With 
David Brinkley," Jan. 31. 

2/4 Shultz: statement. House 
Foreign Affairs Commit- 
tee, Feb. 2. 

2/4 Shultz: remarks, American 
Friends of Turkey, 
Crystal City, Va. 

2/8 Shultz: address and 

question-and-answer ses- 
sion, Henry M. Jackson 
School of International 
Studies, Seattle, Feb. 5. 

2/10 Shultz: interview on PBS- 
TV, University of Wash- 
ington, Seattle, Feb. 5. 

2/10 Shultz, Yeo: remarks at 

opening session of the 8th 
U.S. -ASEAN Dialogue. 

1/16 Program for the official 
working visit to Wash- 
ington, D.C, of West 
German Chancellor Kohl, 
Feb. 17-19. 

1/16 Shultz: address before the 
Anti-Defamation League 
of B'nai B'rith, Palm 
Beach, Feb. 12. 

1/17 Shultz: news conference, 
Bal Harbour, Feb. 16. 



Agreement extending the agreement of 
Sept. 20, 1976, as amended and extended 
(TIAS 10213), in the field of liquid metal- 
cooled fast breeder reactors. Effected by 
exchange of letters at Risley and Wash- 
ington Nov. 25 and Dec. 28, 1987. Entered 
into force Dec. 28, 1987. 

Agreement concerning the investigation of 
drug trafficking offenses and the seizure 
and forfeiture of proceeds and instrumen- 
talities of drug trafficking, with attach- 
ment and exchange of notes. Signed at 
London Feb. 9, 1988. Enters into force on 
the date of exchange of notes setting forth 
the intention of both governments to be 
bound by agreement. 



'Not in force. 

'Applicable to Berlin (West) 
■^Not in force for the U.S. 
•■With reservation. 
*With declaration(s). 
*With amendments. ■ 



*20 2/18 Chester E. Norris sworn in 
as Ambassador to Equa- 
torial Guinea, Feb. 17 
(biographic data). 

*21 2/18 Richard S. Williamson 

sworn in as Assistant Sec- 
retary for International 
Organization Affairs (bio- 
graphic data). 

*22 2/19 Shultz: interview on USIA's 
"Worldnet," Feb. 18. 

*23 2/22 Program for the official 
working visit to Wash- 
ington, D.C, of Por- 
tuguese Prime Minister 
Silva, Feb. 23-25. 

*24 2/24 Shultz, news conference, 
Helsinki, Feb. 20. 

*25 2/24 Shultz: remarks at human 
rights reception, Moscow, 
Feb. 21. 

*26 2/25 Shultz: news conference, 

Moscow, Feb. 22. 
27 2/25 Foreign Relations of the 
United States. 1961-63, 
Volume I, Vietnam, 1961, 
released. 

*28 2/29 Shultz: news 

conference, NATO 
Headquarters, 
Brussels, Feb. 23. 

*29 2/29 Shultz: statement, Ameri- 
can Colony Hotel, Jerusa- 
lem, Feb. 26. 

*30 2/29 Shultz: departure remarks, 
Amman, Jordan, Feb. 27. 

*Not printed in the Bulletin. ■ 



Department of State 



Free single copies of the following Depart- 
ment of State publications are available 
from the Correspondence Management Di- 
vision, Bureau of Public Affairs, Depart- 
ment of State, Washington, D.C. 20520. 

Secretary Shultz 

The Struggle Against Terrorism, Anti- 
Defamation League of B'nai B'rith, Palm 
Beach, Feb. 12, 1988 (Current Policy 
#1045). 

Managing the U.S. -Soviet Relationship, 
Henry M. Jackson School of Interna- 
tional Studies, Seattle, Feb. 5, 1988 
(Current Policy #1043). 

America's Foreign Policy Agenda in 1988, 
House Foreign Affairs Committee, Feb. 
2, 1988 (Current Policy #1040). 

The INF Treaty: Strengthening U.S. 
Security, Senate Foreign Relations Com- 
mittee, Jan. 25, 1988 (Current Policy 
#1038). 

Arms Control 

U.S. Arms Control Initiatives, Feb. 15, 
1988 (Special Report #176). 

The INF Treaty: Negotiation and Ratifica- 
tion, Ambassadors Kampelman and Glit- 
man, House Foreign Affairs Committee, 
Jan. 26, 1988 (Current Policy #1039). 

East Asia 

U.S. -China Science and Technology 

Exchanges (GIST, Feb. 1988). 
U.S. -Japanese Relations (GIST, Feb. 1988). 

Europe 

The U.S. Approach to Eastern Europe: A 
Fresh Look, Deputy Secretary White- 
head, Washington Institute of Foreign 
Affairs, Jan. 19, 1988 (Current Policy 
#1044). 

U.S.-U.S.S.R. Cultural and Educational 
Exchanges (GIST, Feb. 1988). 

Human Rights 

The Semantics of Human Rights, Assistant 
Secretary Schifter, Conference on Hu- 
man Rights and Religious Freedom, Ven- 
ice, Feb. 4, 1988 (Current Policy #1041). 

Implementation of Helsinki Final Act April 
1-October 1, 1987 (Special Report #172, 
Feb. 1988). 

Refugees 

Refugees Worldwide and U.S. Foreign Pol- 
icy: Reciprocal Impacts, Ambassador 
Moore, World Affairs Council, Los An- 
geles, Nov. 19, 1987 (Current Policy 
#1036). 

United Nations 

International Civil Aviation Organization 
(GIST, Feb. 1988). 



Western Hemisphere 

El Salvador: U.S. Policy (GIST, 
Feb. 1988). ■ 



1988 



89 



PUBLICATIONS 



Foreign Relations Volume Released 



The Department, on February 25, 1988, 
released Foreign Relations of the 
United States, 1961-1963, Volume I, 
Vietnam, 1961. This is the most recent 
volume in the official published histor- 
ical documentation on American foreign 
policy and the first volume recording 
the events and efforts of the Admin- 
istration of President John F. Kennedy. 

In 1961, the U.S. Government made 
repeated efforts to assess the growing 
strength of the communist insurgency 
in South Vietnam and to urge President 
Diem and his regime to take the neces- 
sary measures to defeat the Viet Cong. 
This volume chronicles the debate 
within the Kennedy Administration 
over the terms and degree of American 
involvement in Vietnam. The American 
experience in the Korean war, the con- 
tinuing turmoil in Laos, and the crisis 
in Berlin all had an impact upon the 
efforts to contain communism in South- 
east Asia. Despite measured military 
and economic assistance and a morale- 
boosting visit by Vice President Lyn- 
don Johnson, an increasingly pessi- 
mistic appraisal of the situation in 
South Vietnam by the early summer of 
1961 gave rise to proposals in Wash- 
ington for the introduction of U.S. com- 
bat forces into the country. President 
Kennedy's military representative. Gen- 
eral Maxwell Tkylor, visited Vietnam at 
the end of the year and came back with 
recommendations for wide-ranging re- 
forms of the Diem government and the 
dispatch of U.S. troops. The proposals 
set off a controversy among the Presi- 
dent's advisers, but by year's end the 
President had decided against sending 
troops. 

Foreign Relations, 1961-1963, Viet- 
nam, comprises 768 pages of previously 
classified foreign affairs records from 
the Department of State, the White 
House, and other government agencies. 
The Department of State is currently 



publishing the Foreign Relations series 
with the goal of releasing the record of 
the Eisenhower foreign policy by 1990. 
The Department recognizes the con- 
tinuing interest in the diplomacy of the 
Vietnam war and is expediting the pub- 
lication of the Foreign Relations 
volumes on Vietnam. The Foreign Rela- 
tions series is prepared by the Office of 
the Historian, Bureau of Public Affairs, 
Department of State. 



Copies of Volume 1 (Departme 
State Publication No. 9625, GPO S 
No. 044-000-02195-1) may be purch. 
for $21.00 (domestic postpaid) from 
Superintendent of Documents, U.J 
Government Printing Office, Wash- 
ington, D.C., 20402. Checks or mol; 
orders should be made payable to If' 
Superintendent of Documents. 



Press release 27 of Feb. 25, 1988. 



CSCE Semiannual Report Released 



On behalf of the President, tne Secre- 
tary of State on December 4, 1987, 
transmitted the 23d semiannual report 
on the implementation of the Helsinki 
Final Act and the Madrid concluding 
document to the congressional Commis- 
sion on Security and Cooperation in 
Europe. 

This report covers the period April 
1, 1987, to October 1, 1987, and provides 
an assessment of Soviet and East Euro- 
pean compliance with commitments 
they undertook as signatories of the 
Helsinki Final Act and the Madrid con- 
cluding document. Among the issues 
discussed are human rights and human- 
itarian concerns; security and confi- 
dence-building measures; economic, 
scientific, and technological coopera- 
tion; emigration; freedom of informa- 
tion; and educational and cultural 
exchanges. 

The report acknowledges that the 
record of compliance varied among the 
East European states, but it makes evi- 
dent that overall performance by the 
Warsaw Pact nations in the area of hu- 
man rights and human contacts remains 
deplorable. While recognizing that 
some positive developments have taken 



place, the report highlights the fat 
that many citizens of these countri 
continue to suffer persecution for i 
tempting to exercise their basic hi 
rights or for focusing attention on 
lations of these human rights and 
damental freedoms. 

At the Conference on Securitj 
Cooperation in Europe (CSCE) fol 
lowup meeting currently underway 
Vienna, the United States and oth 
lied delegations have also made th 
points, recognizing improvements 
they occur and vigorously highligh 
continuing Soviet and East Europi 
failures where they remain. 

This report is an important el 
ment in the continuing U.S. effort 
assess the progress and shortcomi 
in the implementation of the CSCI 
goals of protecting human rights, 
strengthening security, expanding 
eration, and building mutual 
confidence. 

Free single copies of this 46-f 
report are available from the 
Correspondence Management Divi 
Bureau of Public Affairs, Departm 
of State, Washington, D.C. 20520. 
Please request Special Report #17 



90 



Department of State Blei 



EEX 



1988 
Tie 88, No. 2133 



■• N:(tii)nal Security Strategy of the 

.1 States (Reagan) 1 

- (iiitrol 

•■as Inreign Policy Agenda in 1988 

ntzi 43 

'. lire nn Disarmament Reconvenes in 

K.'agan) 51 

u' U.S. -Soviet Relationship 

38 

il Security Strategy of the United 

s I Keagan) 1 

ir Tisting 'Rilks Open Round Two 

' tf House statement) 50 

(iry's Interview on "This Week With 

I 1 [irinkley" (e.xcerpts) 48 

t Kxperts Visit U.S. Nuclear Test Site 

I ; statement) 51 

>ati(>n of South East .4sian Nations. 
-.\SEAN Dialogue Held in 
lington (Shultz, Yeo, 

statement) 52 

, U.S. Removes GSP Status for Four 
lomies (White House statement, 

;e House fact sheet) 65 

ess 

:a's Foreign Policy Agenda in 1988 

Itz) .' 43 

lal Security Strategy of the United 

es ( Reagan) 1 

:eport on Cvprus (message to the 

gress) ....'. 69 

gencies and the Budget 

Hamson) 81 

s. 35th Report on Cyprus (message to 

Congress) 69 

tment & Foreign Service. America's 
?ign Policy Agenda in 1988 

altz) ' 43 

Asia 

nal Security Strategy of the United 

:es (Reagan) 1 

ASEAN Dialogue Held in Washington 

ultz, Yeo, joint statement) 52 

omics 

ging the U.S. -Soviet Relationship 

ultz) 38 

nal Security Strategy of the United 

tes (Reagan) 1 

Agencies and the Budget 

illiamson) 81 

J.S. Appi-oach to Eastern Europe: A 

;sh Look (Whitehead) 66 

ASEAN Dialogue Held in Washington 

lultz, Yeo, joint statement) 52 

t 

Republic of Egypt 74 

of Egyptian President (Mubarak, 
agan) 72 



Europe 

National Security Strategy of the United 

States (Reagan) 1 

The U.S. Approach to Eastern Europe: A 

Fresh Look (Whitehead) 66 

Fisheries. U.S.-U.S.S.R. Meeting on 

Fisheries Issues (joint .statement) .... 68 
Hong Kong. U.S. Removes GSP Status for 

Four Economies (White House statement, 

White House fact sheet) 65 

Human Rights 

Managing the U.S. -Soviet Relationship 

(Shultz) 38 

The Semantics of Human Rights 

(Schifter) 70 

The Struggle Against Terrorism 

(Shultz) 35 

The U.S. Approach to Eastern Eui'ope: A 

Fresh Look (Whitehead) 66 

Japan 

U.S. -Japanese Relations 64 

U.S. -Japanese Relations in Focus 

(Clark) 58 

Visit of Japanese Prime Minister (Reagan, 

Takeshita, joint statement) 61 

Korea. U.S. Removes GSP Status for Four 

Economies (White House statement. 

White House fact sheet) 65 

Lebanon. Passport Restriction for Lebanon 

(Department statement) 79 

Middle East 

National Security Strategy of the United 

States (Reagan) 1 

Secretary's Interview on "This Week With 

David Brinkley" (excerpts) 48 

Nicaragua 

Aid to Nicaragua (White House 

statements) 85 

America's Foreign Policy Agenda in 1988 

(Shultz) 43 

Central American Peace Process (White 

House statement) 86 

Peace and Democracy for Nicaragua 

( Reagan) 32 

Secretary's Interview on "This Week With 

David Brinkley" (excerpts) 48 

North Atlantic Treaty Organization. 

National Security Strategy of the United 

States (Reagan) 1 

Nuclear Policy. Continuation of Aid to 

Pakistan (White House statement) 80 

Pacific. National Security Strategy of the 

United States (Reagan) 1 

Pakistan. Continuation of Aid to Pakistan 

(White House statement) 80 

Panama. Panama (Department 

statement) 85 

Passports. Passport Restriction for Lebanon 

(Department statement) 79 



Presidential Documents 

Conference on Disarmament Reconvenes in 

Vienna 51 

National Security Strategy of the United 

States 1 

Peace and Democracy for Nicaragua .... 32 
Visit of Egyptian President (Mubarak, 

Reagan) 72 

Visit of Japanese Prime Minister (Reagan, 

Takeshita, joint statement) 61 

Publications 

CSCE Semiannual Report Released 90 

Department of State 89 

Foreign Relniious Volume Released 90 

Singapore. U.S. Removes GSP Status for 

Four Economies (White House statement, 

White House fact sheet) 65 

South Asia. National Security Strategy of 

the United States (Reagan) 1 

Terrorism 

America's Foreign Policy Agenda in 1988 

(Shultz) ." 43 

The Struggle Against Terrorism 

(Shultz) 35 

Trade 

America's Foreign Policy Agenda in 1988 

(Shultz) 43 

National Security Strategy of the United 

States (Reagan) 1 

U.S. Removes GSP Status for Four 

Economies (White House statement. 

White House fact sheet) 65 

Treaties. Current Actions 87 

U.S.S.R. 

Managing the U.S. -Soviet Relationship 

(Shultz) 38 

Nuclear Testing Talks Open Round Two 

(White House statement) 50 

Soviet Experts Visit U.S. Nuclear Test Site 

(joint statement) 51 

The U.S. Approach to Eastern Europe: A 

Fresh Look (Whitehead) 66 

U.S.-U.S.S.R. Meeting on Fisheries Issues 

(joint statement) 68 

United Nations. UN Agencies and the 

Budget (Williamson) 81 

Western Hemisphere 

Central American Peace Process (White 

House statement) 86 

National Security Strategy of the United 

States (Reagan) 1 

Name hidex 

Clark, William, Jr 58 

Mubarak, Hosni Mohammed 72 

Reagan, President 1,32,51,61,69,72 

Schifter, Richard 70 

Shultz, Secretary 35,38,43,48,52 

Takeshita, Noboru 61 

Whitehead, John C 66 

Williamson, Richard S 81 

Yeo Cheow Tong 52 



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he Official Monthly Record of United States Foreign Policy / Volume 88 / Number 2134 



May 1988 




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Deparimtrnt of Siait* 

bulletin 



Volume 88 / Number 2134 / May 1988 



Cover photo: 

President Reagan and Secretary Shultz 
at the North Atlantic Council meetinK in 
Brussels, March 1988. 

(White House photo by Pete Souzal 



The Department of State Bulletin, 
published by the Office of Public Com- 
munication in the Bureau of Fhjblic 
Affairs, is the official record of U.S. 
foreign pohcy. Its purpose is to provide 
the public, the Congress, and govern- 
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GEORGE P. SHULTZ 

Secretary (jf State 

CHARLES REDMAN 

Assistant Secretary 
for Public Affairs 

PAUL E. AUERSWALD 

Director, 

Office of Public Communication 

NORMAN HOWARD 

Chief, Editorial Division 

PHYLLIS A. YOUNG 

Editor 

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Assistant Editor 



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CONTENTS 



e President 

President Attends NATO Sum- 
mit (Presideyit Reagan, Stafe- 
I rnent. Declaration) 

President's Visit to Mexico 
(Miguel de la Madrid Hur- 
tado. President Reagan) 

News Conference of February 24 
(Excerpts) 



e Secretary 

Meeting Our Foreign Policy 

Goals 
The INF Treaty: Advancing U.S. 

Security Interests 
Interview on "Meet the Press" 



Irica 



South Africa's Proposal to Ban 
Foreign Funds (Department 
Statement) 



ms Control 

SDI: Enhancing Security and 

Stability (Edward L. Rowny) 
U.S. Arms Control Initiatives 



St Asia 

Current Reflections on U.S.- 
Japan Relations (Gaston J. 
Sigur, Jr.) 

Pacific Development and the 
New Internationalism 
(Richard H. Solomon) 

Indochinese Refugees and Rela- 
tions With Thailand 
(William A. Brown) 



Europe 

42 Secretary Shultz Visits Moscow 
(Joint Statement) 

42 Soviet Foreign Minister Visits 

Washington (Joint Statement) 

43 Romania Renounces MFN Re- 

newal (Department Statement) 

44 Chancellor Kohl Meets With 

President Reagan (Helmut 
Kohl, President Reagan) 

46 Lithuanian Independence Day, 

1988 (Proclamation) 

47 Visit of Portuguese Prime Minis- 

ter (Anibal Cavaco Silva, 
President Reagan) 

48 Republic of Portugal 



Human Rights 

54 Human Rights and Change in 
Eastern Europe (John C. 
Whitehead) 

l\/liddle East 



United Nations 



67 



56 



57 



A Statement for Palestinians 

(Secretary Shultz) 

Middle East Peace Plan 

(Secretary Shultz) 



Refugees 

58 Aspects of U.S. Resettlement 

Programs for Vietnamese Ref- 
ugees (Robert L. Funseth) 



Terrorism 

61 



62 



64 



Terrorism: Myths and Reality 
(Paul L. Bremer, HI) 

U.S. Signs Treaty on Maritime 
Security (Department State- 
ment) 

U.S. Condemns North Korean 
Terrorism (William Clark, Jr., 
Clayton C. McManaway) 



U.S. Interests in the United Na- 
tions (Vernon A. Walters) 



Western Hemisphere 

69 Events in Panama (Elliott 

Abrams, President Reagan, 
Secretary Shultz, White House 
Statements) 

73 Sandinista Offensive (Secretary 

Shultz, Department and White 
House Statements) 

74 Nicaraguan Resistance and 

Sandinistas Reach Agreement 
(Secretary Shultz) 
76 U.S. -Cuba Migration Agree- 
ment: Resolving Mariel 
(Kenneth N. Skou.g, Jr.) 



Treaties 

81 Current Actions 

Press Releases 

85 Department of State 

Publications 

85 Department of State 
85 Background Notes 

Index 







n 




THE PRESIDENT 



President Attends NATO Summit 



President Reagan joined the heads 
of state and government of the members 
of the North Atlantic Treaty Organiza- 
tion (NATO) at a meeting of the North 
Atlantic Council in Brussels 
March 2-3, 1988. 

Following are remarks made by the 
President on various occasions during 
the visit and the texts of the statement 
and declaration issued by the North 
Atlantic Council. 



DEPARTURE REMARKS, 
MAR. 1, 1988' 

I am going to Europe to meet with a 
group of friends and colleagues: the 
leaders of the North Atlantic alliance. 
We and our foreign affairs and defense 
ministers see a good deal of each other, 
just as friends should. But the meeting 
that begins in Brussels tomorrow will 
be special. It will be the first time in 
almost 6 years that leaders of all the 
NATO countries have met together for 
a summit. 

Much has happened in those 
6 years that we can be very proud of, 
including the INF [Intermediate- 
Range Nuclear Forces] Treaty with the 
Soviet Union that removes an entire 
class of U.S. and Soviet nuclear weap- 
ons—weapons that, on the Soviet side, 
have held the European Continent at 
risk. That historic agreement was pos- 
sible, because the alliance's steadfast 
political and military resolve backed up 
our negotiations with the Soviets. But 
the purpose of this summit is not self- 
congratulations. Our responsibility is to 
the future, and it will be to the future 
that we turn our attention tomorrow. 

Our first priority is to maintain a 
strong and healthy partnership be- 
tween North America and Europe, for 
this is the foundation on which the 
cause of freedom so crucially depends. 
We will never sacrifice the interests of 
this partnership in any agreement with 
the Soviet Union. NATO's agenda for 
peace and freedom has always been am- 
bitious, and it must remain so. 

In the arms control area, we will 
continue to press for Soviet agreement 
to 50% reductions in the strategic nu- 



clear forces of both sides and for a 
truly global and verifiable ban on chem- 
ical weapons. My colleagues and I will 
be working to give negotiations on con- 
ventional forces a new start as well. 

We will also discuss Soviet behav- 
ior toward its own citizens and toward 
other countries, since problems of hu- 
man rights and external aggression re- 
main key obstacles to long-term 
improvement of East-West relations. 

If our common approach to the 
East over the years has given co- 
herence to our message of peace and 
world freedom, it has been our un- 
wavering commitment to defend our- 
selves that has given it credibility. 
Arms reduction can only succeed if it is 
backed up by a strong defense. My At- 
lantic colleagues and I will rededicate 
ourselves to maintaining the deterrent 
that has protected our freedom and 
prosperity for almost 40 years. I will 
repeat to my colleagues my strong 
conviction that American troops will 
remain in Europe, under any Admin- 
istration, so long as Europeans want 
them to stay. 

We can be rightfully proud of these 
40 years of peace that our common com- 
mitment has brought, but the job is not 
finished. We in the alliance will not be 
satisfied merely with a record period 
without war. We seek nothing less than 
permanent peace with freedom in Eu- 
rope and the North Atlantic. This bold 
objective can be attained, but we must 
have the courage to follow the course 
that we have set for ourselves. For four 
decades, the combination of a strong 
common defense and pursuit of dialogue 
with the East has been a winning for- 
mula for NATO. It is a combination 
that can lead us to a future of peace, 
freedom, and prosperity for generations 
to come. 



PRESIDENT'S REMARKS, 
MAR. 2, 19881 

I promised a statement; I have a state- 
ment. Today's meetings have been ex- 
tremely productive. There is a strong 
sense of unity in the alliance, as re- 
flected in the statement on conventional 
imbalance in Europe. This document is 



THE PRESIDENT 



a major step forward for the alliance. 
The most direct threat to our security 
and to stabihty in Europe lies in the 
Soviet Union's massive military pres- 
ence at a level far exceeding its defense 
needs. 

First, effective defenses are vital. 
We are determined to ensure that the 
alliance's defenses remain strong. We 
will continue to cooperate on better and 
more efficient ways to maintain our 
defenses. 

Second, we also seek to strengthen 
stability through effective and verifia- 
ble conventional arms reduction. Large 
asymmetrical reductions in the Warsaw 
Pact tanks and artillery, which pose the 
greatest threat to peace, are essential 
in meeting this goal; but arms reduc- 
tion is not enough. Arms are only the 
symptom, not the cause of the political 
division of Europe between free and 
unfree societies. 

In addition to arms reductions, we 
also look for greater respect for the hu- 
man rights and fundamental freedoms 
on which lasting security and stability 
in Europe ultimately depend. 

During my meetings in Brussels, I 
have kept close watch on the situation 
in the Middle East. Secretary Shultz 
briefed me fully on his negotiating 
efforts, and it is clear all countries in 
the region believe it is useful for the 
United States to remain engaged in 
this process. We will spare no effort in 
our search for a comprehensive peace 
settlement. I have directed Secretary 
Shultz to return to the Middle East to- 
morrow to continue his discussions. 



NORTH ATLANTIC COUNCIL 

STATEMENT. 
MAR. 2, 1988 

Conventional Arms Control: 
The Way Ahead 

At Halifa.x in 1986, our governments is- 
sued a clear call to strengthen stability 
in the whole of Europe through conven- 
tional arms control negotiations. At 
Brussels later that year, they elabo- 
rated the basic purposes and methods 
of such negotiations. 

The military confrontation in Eu- 
rope is the result, not the cause, of the 
painful division which burdens this con- 
tinent. While seeking to overcome this 
division in other ways, we also seek 
security and stability in Europe at the 
lowest possible level of armaments. 
Both arms control and adequate de- 
fense programs can contribute toward 
this goal. 



A. The Present Realities 

1. The Soviet Union's military pres- 
ence in Europe, at a level far in excess 
of its needs for self-defense, directly 
challenges our security as well as our 
hopes for change in the political situa- 
tion in Europe. Thus the conventional 
imbalance in Europe remains at the 
core of Europe's security concerns. The 
problem is, to a large extent, a function 
of the Warsaw Pact's superiority in key 
conventional weapons systems. But it is 
not only a matter of numerical im- 
balances. Other asymmetries are also 
important, for example: 

• The Warsaw Pact, based on the 
Soviet Union's forward-deployed forces, 
has a capability for surprise attack and 
large-scale offensive action; the allies 
neither have, nor aspire to, such a 
capability. 

• The countries of the Warsaw Pact 
form a contiguous land mass; those 

of the alliance are geographically 
disconnected. 

• The Warsaw Pact can generate a 
massive reinforcement potential from 
distances of only a few hundred kilo- 
meters; many allied reinforcements 
need to cross the Atlantic. 

• The Warsaw Pact's military pos- 
ture and activities are still shrouded in 
secrecy, whereas those of allied coun- 
tries are transparent and under perma- 
nent public scrutiny. 

2. These asymmetries are com- 
pounded by the dominant presence in 
Europe of the conventional armed 
forces of the Soviet Union. They repre- 
sent 50% of all the active divisions in 
Europe between the Atlantic and the 
Urals. This Soviet conventional superi- 
ority and its military presence in other 
East European countries serve a politi- 
cal as well as a military function. They 
cast a shadow over the whole of 
Europe. 

3. Conventional arms control is not 
merely a technical corrective to a self- 
contained problem. It should be seen in 
a coherent political and security 
framework. 



B. A Political and Security 
Framework 

4. We reiterate our conviction that mili- 
tary forces should only exist to prevent 
war and to ensure self-defense, not for 
the purpose of initiating aggression and 
not for the purposes of political or mili- 
tary intimidation. Our ability to pre- 
vent every kind of war, nuclear or 



conventional, rests on our capacity ; 
determination to deter any form of ; 
gression. All the allies' military re- 
sources are designed to contribute t 
that objective. This approach is shai, 
alike both by those allies who belon 
the integrated military organization 
by those who do not. 

5. The relationship between nuc 
and conventional forces is complex, 
existence of a conventional imbalanc 
favor of the Warsaw Pact is not the ■ 
reason for the presence of nuclear 
weapons in Europe. The countries o 
the alliance are, and will remain, un 
the threat of Soviet nuclear forces o 
varying ranges. Although conventio) 
parity would bring important benefi 
for stability, only the nuclear elemer 
can confront a potential aggressor w 
an unacceptable risk; therefore, for 
foreseeable future, deterrence will c 
tinue to require an adequate mix of : 
clear as well as conventional forces. 

6. Hence the determination of oi 
nations to ensure defense preparedn 
as a means of achieving the stability 
seek. We will continue to ensure tha 
our military forces are effective and 
to-date, in particular by: 

• Continued compliance with the 
principle of shared risks and respon- 
sibilities and acceptance of the pri- 
orities essential to the strengthening 
our defense capabilities; 

• Provision of adequate defense i 
penditures, together with efforts to i 
tain the greatest return on our defen 
investment; 

• Closer cooperation designed to 
remedy key deficiencies and, in this 
context, support for recent legislativi 
and other initiatives designed to fosti 
cooperation in the area of convention 
armaments, especially research, deve 
opment, production, and procuremen 
and 

• Helping to meet the needs of 
the less advantaged allies in strength 
ening their conventional defenses, thi 
redressing important existing 
deficiencies. 

7. It will be important that defen 
and arms control policies remain in hf 
mony in order to ensure their comple 
mentary contribution to the security ( 
the countries of the alliance. In frami 
their negotiating proposals for conven 
tional stability, the allies will ensure 
that the continued requirement for de 
terrence and defense is not prejudicec 
accordingly, they will neither make nc 
accept proposals which would involve 
an erosion of the allies' nuclear deter- 
rent capability. 



lit: 



THE PRESIDENT 



8. Security in Europe involves not 
; military but also political, eco- 

lic, and, above all, humanitarian fac- 

We look forward to a Europe 
ivided, in which people of all states 
freely receive ideas and informa- 
i, enjoy their fundamental human 
its, and determine their own future, 
ed forces are stationed outside their 
lonal territory to protect these val- 
and to uphold the solidarity of our 
; alliance. They cannot, therefore, 
aquated with Soviet forces stationed 
i]astern Europe. A just and lasting 
ceful order in Europe requires that 
states enjoy relations of confidence 
h their own citizens, trust them to 
ce political or economic choices of 
ir own, and allow them to receive 
rmation from and e.xchange ideas 
ti citizens of other states. 

9. Conventional arms control talks 
uld be guided by a coherent political 
on which reflects these values. It 

■ their adherence to this vision 
ch enabled the allies to secure a 
:essful outcome to the Stockholm 
ference. It is these same considera- 
is that have led the allies to decide 
t both the negotiations which they 
e now proposed, on conventional 
Dility, as well as those on confidence- 
security-building measures, will be 
lertaken within the framework of 
CSCE [Conference on Security and 
)peration in Europe] process. 

10. Those on confidence- and 
urity-building will involve all 35 

CE signatory states and will have as 
ir objective to build upon and e.x- 
id the results of the Stockholm con- 
;nce; the agreement reached there 
rked a significant step toward reduc- 
the risk of war in Europe. Fully 
)lemented over time, it would create 
re transparency and contribute to 
ater confidence and predictability of 
itary activities in the whole of Eu- 
e. The momentum generated by 
ckholm must be maintained. 

11. At the same time, we are con- 
)us of the specific responsibility of 

23 members of the two military al- 
ices in Europe whose forces bear 
3t directly on the essential security 
itionship in Europe. Hence our deci- 
1 that distinct and autonomous nego- 
ions on conventional stability should 
e place between the 23 states. 

12. The adoption of mandates for 

h of the negotiations must be part of 
alanced outcome to the Vienna 
2F, followup meeting, which necessi- 
;s substantial progress in all areas of 
Helsinki Final Act. 





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President Reagan and NATO Secretary General Lord Carrington. 



C. The Allies' Objectives 

13. In accordance with the principles of 
our approach to conventional arms con- 
trol, as set out in the Brussels declara- 
tion, our objectives in the forthcoming 
conventional stability negotiations will 
be: 

• The establishment of a secure and 
stable balance of conventional forces at 
lower levels; 

• The elimination of disparities 
prejudicial to stability and security; and 

• As a matter of high priority, the 
elimination of the capability for launch- 
ing a surprise attack and for initiating 
large-scale offensive action. 

14. This latter capability is the 
most worrying in relation to the seizure 
of territory by an aggressor. Its essen- 
tial ingredient is the forward deploy- 
ment of conventional forces capable of 
rapid mobility and high firepower. 
Tanks and artillery are among the most 
decisive components, though other ele- 
ments of combat capability could prove 
to be similarly significant. Manpower is 
also important. But not all items of 
equipment are appropriate for limita- 
tion, if only for technical reasons, and 



manpower alone is an imprecise guide 
to offensive capability. 

15. Our aim will be to establish a 
situation in Europe in which force pos- 
tures, as well as the numbers and de- 
ployments of weapons systems, no 
longer make surprise attack and large- 
scale offensive action a feasible option. 
We shall pursue this aim on the basis of 
the following criteria. 

• We need to enhance stability in 
the whole of Europe from the Atlantic 
to the Urals and to do so in a way 
which, while safeguarding the security 
of all allies, takes account of the con- 
centrations of Warsaw Pact forces and 
the particular problems affecting the 
central, southern, and northern 
regions. 

• In seeking to eliminate the ability 
to conduct large-scale offensive action, 
we shall focus on the key weapons 
systems. 

• We shall propose provisions deal- 
ing with stationed forces, taking ac- 
count of the weight of forward-deployed 
Soviet conventional forces. We shall 
also take into consideration capabilities 
for force generation and reinforcement. 



Lii 



THE PRESIDENT 



• Equal number or percentage re- 
ductions by both sides would not elimi- 
nate the disparities which threaten 
stability in Europe. Our proposals will 
concentrate instead on results and re- 
sidual entitlements. 

• Our goal is to redress the conven- 
tional imbalance. This can be achieved 
through a set of measures including, 
inter alia, reductions, limitations, re- 
deployment provisions, and related 
measures, as well as the establishment 
of equal ceilings. 

• This outcome will require highly 
asymmetrical reductions by the East 
and will entail, for e.xample, the elim- 
ination from Europe of tens of thou- 
sands of Warsaw Pact weapons relevant 
to surprise attack, among them tanks 
and artillery pieces. 

• Reductions of combat-decisive 
equipment and modification of the So- 
viet forward deployment posture will 
only be part of our approach to reduc- 
ing the risk of conflict. As a concurrent 
element in any effort to enhance sta- 
bility and security, we shall also pro- 
pose measures to produce greater 
openness of military activities through- 
out Europe, safeguard the maintenance 
of lower force levels, and support a 
rigorous, effective, and reliable moni- 
toring and verification regime. 

• This monitoring and verification 
regime will need to include the ex- 
change of detailed data about forces 
and deployments and the right to con- 
duct sufficient on-site inspections to 
provide confidence that agreed provi- 
sions are being complied with. 

D. The Way Ahead 

16. Early agreement on a conventional 
stability mandate, as part of a balanced 
outcome to the Vienna followup meet- 
ing of the CSCE, would be an impor- 
tant step forward. We seek the 
elimination of the conventional im- 
balances which so threaten stabihty and 
security in Europe. We also seek en- 
hanced respect for human rights and 
fundamental freedoms on which lasting 
security and stability ultimately 
depend. 

Greece recalls its position on nu- 
clear matters. 



PRESIDENT'S REMARKS, 
MAR. 3, 19881 

My aUiance colleagues and I have just 
concluded our latest round of consulta- 
tions on the full range of issues facing 
us. First, let me say that the state of 
the alliance is excellent. We are strong; 
we are united; we are prosperous; and 
we are free. 

This is the second full-fledged al- 
liance summit that I have attended. 
Some of my colleagues and I also met 
here following my first meeting with 
Mr Gorbachev. So while this is a spe- 
cial occasion, it is also only one element 
in the much larger pattern of close and 
continuous consultations that is a fun- 
damental reason for the success of this 
alliance. 

NATO will soon begin its fifth dec- 
ade. The North Atlantic alliance is the 
most successful in history. While other 
alliances have been formed to win wars, 
our fundamental purpose is to prevent 
war while preserving and extending the 
frontiers of freedom. 

The INF Treaty is the most recent 
NATO success. My colleagues and I are 
all justifiably proud of that achieve- 
ment. It was the direct result of our 
steadfastness and persistence in carry- 
ing out the two-track decision that we 
made as an alliance over 8 years ago. It 
goes without saying that our allies sup- 
port this treaty, and every leader sol- 
idly reaffirmed its value to the security 
concerns of the alliance. Now our focus 
turns on meeting the challenges of the 
future. 

During the past 2 days, we went 
over the full range of issues that affect 
our collective security. I reiterated the 
strong bipartisan support that exists 
for the alliance in the United States 
and the commitment that American 
troops will remain in Europe, under 
any Administration, so long as the need 
for a forward defense of our common 
values remains. 

We cannot and will not put our 
peace and freedom, and that of our chil- 
dren and their children, at risk. All of 
us understand the absolute necessity of 
maintaining the credibility of our deter- 
rent. We will never trade that cred- 
ibility away at the negotiating table, 
and we will not give it away through 
neglect. 

The most direct threat to our se- 
curity and to stability in Europe lies in 
the Soviet Union's massive military 
presence. The alliance has given its 
needs a lot of thought, knows what it 



!•»! 



wants to do, and has programs that 
has committed to carry out. And th 
is no doubt the alliance stands on 
strength and unity. 

The alliance is the most dynam) v 
force for improvement in East-Westi i*'"' 
lations. From our meetings here, ot 
commitment is to move forward to r 
our defense requirements while con 
tinuing discussions on our four-part 
agenda with the new Soviet leaders! 
The alliance has agreed on its arms 
control priorities and is ready to ge1 
down to business. NATO fully suppi 
my effort to negotiate deep reductic 
in strategic weapons. 

While arms reduction is a part- 
but only a part — of our discussions, 
progress in this area must always be 
based on enhancing our security, noi' 
substituting for it. Our alliance has 
guaranteed peace in Europe and the 
North Atlantic for almost 40 years, 
am more confident than ever, after 
these 2 days of meetings, that the al 
liance remains on the right path and 
that, as always, we have the courag( *" 
and the will to follow it. 

Let me conclude by noting that 
this will be one of the last alliance 
meetings for Secretary General Pete'Ci 
Carrington. Lord Carrington has he» t 
at the helm of the alliance and NATC m 
for 4 crucial years. He has steered tU 
ship of 16 states with a steadiness th'-f'- 
has earned our unbounded admiratio 
I am sure that I speak for all my col- 
leagues in expressing our heartfelt 
thanks to Lord Carrington and our b 
wishes to Dr. Manfred Woerner, who 
strong hand will soon be at the helm 
The West has no better champions th 
these two distinguished statesmen. 



NORTH ATLANTIC COUNCIL 

DECLARATION, 
MAR. 3, 19881 

A Time for Reaffirmation 

We, the representatives of the sixteen 
members of the North Atlantic Alliance, 
have come together to re-emphasize our 
unity, to assess the current state of East 
West relations, to review the opportuniti' 
and challenges which lie ahead and in so 
doing: 



• To reaffirm the common ideals and 
purposes which are the foundation of our 
partnership; 

• To rededicate ourselves to the princ 
pies and provisions of the Washington 
Treaty of 1949; 

• To reassert the vital importance of 
the Alliance for our security, and the valii 
ity of our strategy for peace. 



Department of Slate Bullets 



THE PRESIDENT 



Purposes and Principles 
nr Alliance 

ir Alliance is a voluntary association 
;e and democratic equals, united by 
aon interests and values. It is un- 
jdented in its scope and success. Our 
rity is indivisible. Our Alliance is dedi- 
i to preserving peace in freedom and 
llective self-defence, as recognized by 
Jnited Nations Charter. None of our 
)ons will ever be used e.xcept in re- 
se to attack. 

3. Our concept of a balanced security 
:y as set out in the Harmel Report has 
essfuUy stood the test of time. It re- 
is valid in its two complementary and 
ually reinforcing approaches: political 
larity and adequate military strength, 

on that basis, the search for construc- 
dialogue and co-operation, including 
5 control. The ultimate political pur- 

of our Alliance is to achieve a just and 
ng peaceful order in Europe. 

4. The security in freedom and the 
perity of the European and North 
■rican Allies are inextricably linked, 
longstanding commitment of the North 
•rican democracies to the preservation 
;ace and security in Europe is vital, 
presence in Europe of the conventional 
nuclear forces of the United States 
ides the essential linkage with the 

;ed States strategic deterrent, and, to- 
ler with the forces of Canada, is a tan- 
5 expression of that commitment. This 
ence must and will be maintained. 
Likewise, a free, independent and in- 
I singly united Europe is vital to North 
ijrica's security. The credibility of Allied 
I nee cannot be maintained without a 
iDr European contribution. We therefore 
1 'ome recent efforts to reinforce the Eu- 
nan pillar of the Alliance, intended to 
! ngthen the transatlantic partnership 
I Alliance security as a whole. 
1 The Atlantic Alliance cannot be strong 
(i urope is weak. 

5. Our aim will continue to be to pre- 
b: any kind of war or intimidation. By 
intaining credible deterrence the Al- 
ice has secured peace in Europe for 
rly forty years. Conventional defences 
le cannot ensure this; therefore, for the 
^seeable future there is no alternative 
he Alliance strategy for the prevention 
/ar. This is a strategy of deterrence 
ed upon an appropriate mix of adequate 
effective nuclear and conventional 
:es which will continue to be kept up to 
3 where necessary. 

6. While seeking security and stability 
ower levels of armaments, we are deter- 
iied to sustain the requisite efforts to 
jure the continued viability, credibility 
I effectiveness of our conventional and 
ilear forces, including the nuclear forces 
Europe, which together provide the 
Lrantee of our common security. Taking 
jj account the structure of the Alliance, 
h of us undertakes to play his part in 



this joint endeavour in a spirit of soli- 
darity, reaffirming our willingness to share 
fairly the risks, burdens and respon- 
sibilities as well as the benefits of our com- 
mon efforts. 

7. We seek a just and stable condition 
of peace in which the sovereignty and ter- 
ritorial integrity of all states are respected 
and the rights of all individuals, including 
their right of political choice, are 
protected. 

We want gradually to overcome the un- 
natural division of the European continent, 
which affects most directly the German 
people. We will continue to uphold the 
freedom and viability of Berlin and to sup- 
port efforts to improve the situation there. 
The search for improved and more sta- 
ble relations with the Soviet Union and the 
other countries of Eastern Europe is 
among our principal concerns. We call upon 
these countries to work with us for a fur- 
ther relaxation of tensions, greater se- 
curity at lower levels of arms, more 
extensive human contacts and increased ac- 
cess to information. We will continue the 
effort to expand co-operation with the East 
wherever and whenever this is of mutual 
benefit. 

East-West Relations: The Way Ahead 

8. We have noted encouraging signs of 
change in the policies of the Soviet Union 
and some of its allies. This creates the 
prospect for greater openness in their rela- 
tions with their own people and with other 
nations. We welcome such progress as has 
been already achieved in certain areas. But 
we look beyond pronouncements for tangi- 
ble and lasting policy changes addressing 
directly the issue dividing East and West. 
9. However, we have to date witnessed 
no relaxation of the military effort pursued 
for years by the Soviet Union. The Soviet 
Union persists in deploying far greater 
military forces than are required for its 
defence. This massive force, which the So- 
viet Union has not refrained from using 
outside its borders, as is still the case in 
Afghanistan, constitutes a fundamental 
source of tension between East and West. 
The steady growth of Soviet military ca- 
pabilities," as it affects every region of the 
Alliance, requires our constant attention. 
10. We will continue to be steadfast in 
the pursuit of our security policies, main- 
taining the effective defences and credible 
deterrence that form the necessary basis 
for constructive dialogue with the East in- 
cluding on arms control and disarmament 
matters. 

To meet our security needs in the 
years to come will require ever greater ef- 
ficiencies in the application of our scarce 
resources. We are therefore determined to 
expand our practical co-operation in the 
field of armaments procurement and else- 
where. In this context we recognise the 
challenges to our industrially less advanced 
Allies and the need to address them 
through mutual assistance and co- 
operation. 



11. Arms control is an integral part of 
our security policy. We seek negotiations 
not for their own sake but to reach agree- 
ments which can significantly reduce the 
risk of conflict and make a genuine contri- 
bution to stability and peace. We shall 
work together vigorously and on the basis 
of the closest consultation to this end. 

12. Our representatives to the North 
Atlantic Council continue actively the fur- 
ther development of a comprehensive con- 
cept of arms control and disarmament as 
directed in the Statement of our Ministers 
at Reykjavik in June 1987. 

13. The recently concluded INF agree- 
ment between the US and the Soviet 
Union is a milestone in our efforts to 
achieve a more secure peace and lower lev- 
els of arms. It is the impressive result of 
the political courage, the realism and the 
unity of the members of the Alliance. The 
treaty's provisions on stringent verification 
and asymmetrical reductions provide useful 
precedents for future agreements. We look 
forward to its early entry into force. 

14. Consistent with their security re- 
quirements, the fifteen Allies concerned 
will make use of all possibilities for effec- 
tively verifiable arms control agreements 
which lead to a stable and secure balance 
of forces at a lower level. For them, the 
comprehensive concept of arms control and 
disarmament includes: 

• A 50% reduction in the strategic of- 
fensive nuclear weapons of the US and the 
Soviet Union to be achieved during current 
Geneva negotiations; 

• The global elimination of chemical 
weapons; 

• The establishment of a stable and se- 
cure level of conventional forces, by the 
elimination of disparities, in the whole of 
Europe; 

• In conjunction with the establish- 
ment of a conventional balance and the 
global elimination of chemical weapons, 
tangible and verifiable reductions of Amer- 
ican and Soviet land-based nuclear missile 
systems of shorter range, leading to equal 
ceilings. 

15. Recognizing the urgency and cen- 
tral importance of addressing the conven- 
tional force imbalances in Europe, we have 
adopted a separate statement on conven- 
tional arms control. 

16. The resolution of East- West differ- 
ences will require progress in many fields. 
Genuine peace in Europe cannot be estab- 
lished solely by arms control. It must be 
firmly based on full respect for fundamen- 
tal human rights. As we continue our 
efforts to reduce armaments, we shall 
press for implementation on the part of the 
governments of the Soviet Union and of 
other Eastern countries of all of the princi- 
ples and provisions of the Helsinki Final 
Act and of the Madrid Concluding Docu- 
ment. We support the continuation and 
strengthening of the CSCE process. It rep- 
resents an important means of promoting 
stable and constructive relations on a long- 



THE PRESIDENT 



term basis between countries of East and 
West, and, moreover, enhances closer and 
more fruitful contacts between peoples and 
individuals throughout Europe. We call 
upon all participating states to make every 
effort for an early conclusion to the CSCE 
follow-up meeting in Vienna with a sub- 
stantial and balanced final document. 

17. We agree that the speedy and com- 
plete withdrawal of Soviet troops from 
Afghanistan and the effective restoration 
of that country's sovereignty would be of 
major significance. It is against these cri- 
teria that we shall assess General Secre- 
tary Gorbachev's recent statements. 

18. We hope that at their forthcoming 
summit in Moscow President Reagan and 
General Secretary Gorbachev will be able 
to build upon the progress achieved at 
their Washington meeting last December. 
We strongly support the efforts of the 
United States. These fully accord with our 
consistent policy to seek, through high- 
level dialogue, early and substantial prog- 
ress with the Soviet Union on a full range 
of issues, including greater respect for hu- 
man rights, arms control, a lessening of 
regional tensions and improved oppor- 
tunities for bilateral contacts and co- 
operation. 

19. Reflecting upon almost four dec- 
ades of common endeavour and sacrifice 
and upon the results achieved, we are con- 
fident that the principles and purposes of 
our Alliance remain valid today and for the 
future. We are united in our efforts to en- 
sure a world of more secure peace and 
gi-eater freedom. We will meet the oppor- 
tunities and challenges ahead with imag- 
ination and hope, as well as with firmness 
and vigilance. We owe no less to our 
peoples. 

Greece recalled its position on nuclear 
matters. 



'Te.xt from Weekly Compilation of 
Presidential Documents of Mar. 7, 1988. 



President's Visit to IVIexico 



President Reagan visited Mexico 
on February 13, 1988, for a meeting 
with President Miguel de la Madrid 
Hurtado. 

Following are arrival remarks 
made by the two Presidents, a luncheon 
toast made by President Reagan, and 
the text of a White House statement.'^ 



ARRIVAL CEREMONY, 

MAZATLAN, 

FEB. 13, 1988 

President De la Madrid^ 

On behalf of the people and the Govern- 
ment of Mexico, I am very pleased to 
extend a most cordial welcome to the 
President of the United States of Amer- 
ica and to the distinguished members of 
his party. 

This is the sixth time that we two 
Presidents have met, and, on balance, 
this type of top-level communication be- 
tween the governments of our countries 
has shown itself to be both effective 
and useful. On the basis of personal 
friendship and direct, frank communica- 
tion, we two Presidents have peri- 
odically had the opportunity to review 
issues of interest to us and to improve 
the manner in which our relations are 
conducted. 

I must gratefully acknowledge 
President Reagan's interest in maintain- 
ing our relations within an atmosphere 
of mutual cordiality, dignity, and re- 
spect. We have dealt successfully with 
delicate issues and broadened the basis 
for cooperation, which, as neighbors, 
our two countries require. Today we 
can affirm that our relations are con- 
ducted on a very positive level. There is 
fluid and wide-ranging communication 
between the two governments, and we 
have institutional mechanisms, not only 
to solve but also to prevent problems. 

I am certain that on this occasion, 
perhaps the last time we meet as Presi- 
dents, we will strengthen the basis for 
good and productive relations and dis- 
cuss as frankly as we always have the 
problems on our agenda. 

President Reagan, I cordially wel- 
come you and also the members of your 
party. 



«(l 



President Reagan 

President De la Madrid, distinguishi 
guests, people of Mexico: This is a r 
mentous occasion for me. Over 5 yej 
ago, President De la Madrid and I f 
met near the border in Tijuana. We 
dedicated ourselves to building on tl 
strength, friendship, and cooperatio 
that are traditional bonds between c 
two countries. We resolved to addre 
the daily concerns of our citizens wi 
mutual respect and understanding, 
set out to make progress on difficult 
issues and to discuss areas of disagr 
ment with the candor of good friend 
The personal rapport we developed 
served the interests of both our 
peoples. 

Today Mexico and the United 
States stand together as we strive t 
meet the perplexing challenges that 
face our nations. We can be proud ol 
what has been accomplished in so sh 
a period. We have created dynamic 
commercial ties that lay the foundat 
for a stronger and expanding trade i 
lationship and more competitive ecoi 
mies. We have worked together to fi 
positive and creative solutions to a ' 
threatening international debt probl. 
We have established strong new mec 
nisms to deal with border matters. \ 
have strengthened law enforcement i 
operation, reducing the ability of crii (■ 
nals to take advantage of different , 
jurisdictions. , 

Today we will meet again in the » 
spirit of good will and cooperation th. 
has been the hallmark of our relation 
Today we help pave the way for a nev „ 
generation of political leaders in both ,; 
our countries who will .soon follow us 
and build on the foundation we've laic 
That foundation is cemented by o 
shared values and common goals: a be 
ter quality of life for our peoples, op- 
portunities for our children, and the (, 
dignity of living peacefully in free anc 
democratic societies. Much still needs 
to be done to achieve these goals, but 
we can be proud of the legacy we leav 

Next year we will commemorate 
the 100th anniversary of the founding 
the U.S. -Mexico International Bound- 
ary and Water Commission. The com 
mission has been a success, a model ft 



iilii 



;ioi: 



Denartmpnt nf .9tate Rnllot; 



'HIJIH 



THE PRESIDENT 



ijers throughout the world. It is con- 

' p 'ml living proof that two nations 
as neighbors, deal with the re- 
a 3,000-kilometer border, and 
Hi each other's sovereign independ- 

u' and identity. 

r] There will be no greater monument 
his upcoming anniversary, which 
•ks a century of Me.xican-American 
peration, than the current high 
le of relations between the leaders 
ur countries and the bonds of fam- 
commerce, and friendship between I 
peoples. This is the spirit in which 1 

)me today. 5 



[ITE HOUSE STATEMENT, 
|IB. 13, 1988 

sident Reagan and President De la 
irid met privately for approximately 
luinutes with only notetakers pres- 
. President Reagan congratulated 
sident De la Madrid on his 5 years 
eadership and for the modernization 
t he had brought to Mexico. The 
sident stressed that during the ten- 

of the two Presidents significant 
cesses had been achieved in trade, 
sstment relations, drug enforce- 
nt, commercial ventures, and gen- 
1 economic improvements. 

The President stressed the impor- 
ce of the drug problem for our two 
ntries. He raised the issue of cer- 
?ation to Congress by March 1 and 
;ed the Mexican President to work 
n harder on drug eradication. Presi- 
it De la Madrid emphasized his deep 
cern and intensive efforts to deal 
h the drug problem. He said he con- 
nns narcotics and would have more 
jay on the matter publicly later, 
^sident De la Madrid quoted a 
nber of statistics concerning their 
ig enforcement activities. President 
igan recognized that Mexico has 
n very cooperative in fighting 
gs, but also pointed out that "this is 

year we have to show results." 

The two leaders also discussed 
itral American policy. The President 
eated his commitment to the peace 
cess and to his support for the re- 
ance. President De la Madrid said 
country has been supportive of the 
}uipulas plan [Guatemala accords]. 

They also discussed East-West re- 
ons, and the President commented 
his recent summit meeting with 
leral Secretary Gorbachev. 




President Reagan and President De la Madrid. 



Mexico — A Profile 



Geography 

Area: 1.978 million sq. km. (764,000 sq. 
mi.); about three times the size of Texas. 
Cities: Capital — Mexico City (pop. 18 mil- 
lion, est. 1985). Other cities — Guadalajara 
(3 million), Monterrey (2.7 million), Ciudad 
Juarez (1.12 million), Puebla de Zaragoza 
(1.1 million), Leon (1 million). Terrain: 
Varies from coastal lowlands to high moun- 
tains. Climate: Varies from tropical to 
desert. 



People 

Nationality: Noun and adjective — Mex- 
ican(s). Population (July 1987): 81.9 mil- 
lion. Annual growth rate (1987 est.): 
2.09%. Ethnic groups: Indian-Spanish 
^mestizo) 60%, American Indian .30%, Cau- 
casian 9%, other 1%. Religion: Roman 
Catholic 97%, Protestant 3%. Language: 
Spanish. Education: Years compulsory — 
10. Literacy— 88%. Health: Infant mor- 
tality rate (1984)— 51.0/1,000. Life expect- 
ancy (1984) — 65.4 yrs. Work force 
(26,320,000, 1985): Agriculture, forestry, 
hunting, fishing — 26%. Manufacturing — 
12.8%. Connnerce—\3.9%. Services- 
Si. 4%. Mining o?(rf quarrying — 1.3%. 
Construction — 9.5%. Electricity — 0.3%. 
Transportation and communication. — 
4.8%. 



Economy 

GDP (1987 est.): $126 billion. Per capita 
GDP (1987 est.): $1,537. Annual real GDP 
growth (1987 est.): 1.5%. Avg. inflation 
rate (1987 prelim.); 158.8%. 

Natural resources: Petroleum, silver, 
copper, gold, lead, zinc, natural gas, 
timber. 

Agriculture: Products — corn, beans, 
oilseeds, feedgrains, fruit, cotton, coffee, 
sugarcane, winter vegetables. 

Industry: Types — manufacturing, serv- 
ices, commerce, transportation and com- 
munications, petroleum and mining. 

Trade (1987 est.): Exports— $20.6 bil- 
lion: manufacturing 48%, petroleum and 
derivatives 42%, agriculture 7%, mining 
3%. Imports — $12.1 billion: intermediate 
goods 73%, capital goods 21%, consumer 
goods 6%. Major trading partners — US, 
EC, Japan. 

Official exchange rate: (mid-Jan. 
1988); 2,207 pesos = US$1 (controlled rate); 
2.223 pesos = US$1 (free market rate). 



Taken from the Background Notes of 
February 1988, published by the Bureau of 
Public Affairs, Department of State. 
Editor: Juanita Adams. ■ 



Mgss 



THE PRESIDENT 



PRESIDENT REAGAN'S 

LUNCHEON TOAST, 
FEB. 13, 19883 

This is the sixth time President De la 
Madrid and I have met, as he told us, 
since 1982. I am extremely pleased with 
our discussions and with the remark- 
able record of accomplishment since we 
last met in Washington. 

Our commercial relations are per- 
haps the most dramatic example of this 
progress. The signing of our new 
framework understanding last 
November marked the beginning of a 
special trade and investment rela- 
tionship between our countries. Today 
we have rededicated ourselves to work 
together through the framework proc- 
ess and in the GATT [General Agree- 
ment on Tariffs and Trade] to seize 
every opportunity to expand commerce 
between us. One day I hope these steps 
will be seen as part of the historic evo- 
lution toward the free and unimpeded 
trade and investment on this continent 
and in the Western Hemisphere. 

There are, of course, obstacles to 
overcome, not the least of which is a 
persistent debt problem. There is, how- 
ever, reason for optimism on this ac- 
count. Innovative, market-based ideas 
on how to manage the international 
debt problem are emerging. Mexico's 
plan to exchange debt for long-term 
bonds is but one example. 

And cooperation on the debt is but 
one of the many areas where progress 
is being made. Agreements that have 
been reached or are near in several 
areas — such as textiles, telecommunica- 
tions, and civil aviation — are positive 
steps forward. 

We can also point to the successful 
management of difficult environmental 
problems along our common border. 
Under the agreement we signed in 
1983, we're meeting our respon- 
sibilities. This is exemplified by the re- 
cently signed contingency plan on 
hazardous substances. 

Population movement and employ- 
ment needs will continue to be crucial 
factors in our relationship. And I'm 
gratified by the new dialogue we've un- 
dertaken on these subjects and by the 
establishment of U.S. and Mexican 
commissions to study these questions 
jointly. 



In 1986, the U.S. Congress passed, 
and I signed into law, the Immigration 
Reform and Control Act, intended to 
reestablish control of our borders. It 
offers protections for well over 1 million 
undocumented immigrants living in the 
United States, many of whom are from 
Mexico, by providing a means for them 
to find legal employment and to partici- 
pate openly and freely in our society. 

The mutual legal assistance treaty 
signed in December has already been 
ratified by the Mexican legislature. A 
few days ago I transmitted this treaty 
to the U.S. Senate for prompt ratifica- 
tion so that cooperation against crimi- 
nals can be intensified. 

And as for the fight against crimi- 
nals, Mr. President, perhaps our most 
serious undertaking has been the battle 
against the scourge of international 
drug trafficking and the use of these 
drugs in our societies. The people of 
the United States are now turning away 
from drugs. Drug use is no longer fash- 
ionable, and in most circles it's no 
longer tolerated. My wife, as you're 
aware, has taken the lead in an ener- 
getic program to combat drug abuse. 
Our success, measured by the number 
of people rejecting drugs, should curb 
the demand that fuels the trafficking. 

This menace threatens the fabric of 
both our societies. The heartache and 
corruption brought on by these traf- 
fickers are pervasive. President De la 
Madrid, if the decent people of our two 
societies are to win, it requires cooper- 
ation and a mutually reinforcing effort. 
And, Mr President, I'm certain we are 
both committed to victory in this war 
against drugs and the evil it has 
wrought on our peoples. 

Our first responsibility to our cit- 
izens is to assure them an environment 
where they can raise their families in 
peace and freedom and prosperity. And 
that is why our commitment to democ- 
racy in our hemisphere must be un- 
shakable. Totalitarian societies — such 
as those in the Soviet Union, Cuba, and 
now Nicaragua — have demonstrated for 
all to see that tyranny doesn't work. 
Mexico and the United States have a 
common interest in stable, free, and 
democratic governments in this hemi- 
sphere. I would hope this common in- 
terest will manifest itself in a common 
stand against the expansion of 
totalitarianism. 



A year from now, new president 
will be in office in both our countrie; 
They will be challenged, as have you 
and I, Mr. President, to achieve real 
measurable progress on matters that 
concern us both because they affect 
daily lives of our people. In the past 
years, we have demonstrated that W( 
can cooperate to achieve creative, mi 
tually beneficial solutions, and this is 
valuable legacy that we leave to our 
successors. 

Mr. President, I want to say pulf*'l 
licly before we part that I truly belif 
history will honor you for the wise a 
politically courageous way you're gui 
ing Mexico on the difficult but ulti- 
mately rewarding path to economic 
recovery and national development. 
This is an effort worthy of our admir 
tion, our respect, and our support. I 
I know that with continued per- 
severance it will be crowned with sui 
cess. I also believe, Mr. President, tl|''f 
you and I together have turned the r 
lationship between the United States 
and Mexico in a new, more construct 
direction that our successors can bui! p 



jiii 



upon. 

When I arrived today, I spoke ol 
the foundation for Mexican- Americai 
relations that we've laid these last .5 
years. Well, you know, one of my firs 
jobs as a young man was digging fou ' ■ 
dations at a construction site. I work <!-■ 
there with strong, decent men whost fc 
hard work was a necessary part of th h 
building process. P 

President De la Madrid, it's beer " 
an honor for me to work with you ani 
your colleagues, to labor beside you, 
and to have your friendship. Our peo- 
ples will live better lives for what we fc 
done together. I can think of no goal 
better than that. 

So, I propose a toast to you and 1 
relations between the United States 
and Mexico. And may they always be 
sunny as the skies here today over 
Mazatlan. 



'Text from Weekly Compilation of 
Presidential Documents of Feb. 22, 19; 

-President De la Madrid spoke in 
Spanish, and his remarks were translatec 
by an interpreter. 

'Made in response to a toast propose 
by President De la Madrid at the Camino 
Real Hotel. ■ 



npn;,rtmpnt nf St^tP Rullelk 



THE PRESIDENT 



ews Conference of February 24 
•xcerpts) 



President Reagan held a news con- 
znce on February 2k, 1988.^ 

:retary of State George Shultz today 
orted to me on his recent trip to 
iscow, and it was encouraging. Prog- 
s continues to be made on our four- 
t agenda, and the commitment re- 
ins to do all that we can to advance 

cause of peace and to settle re- 
nal conflicts. 

In the Middle East, it's time for all 
■ties to rid themselves of old ideas 
I stances that cannot work and to 
^n a serious process of negotiation 
I reconciliation. Any process that is 
iertaken must meet Israel's security 
'ds and satisfy the legitimate rights 

he Palestinians. Secretary Shultz 
ves tonight for the Middle East to 

if practical and real progress can be 
de that provides a pathway to a com- 
■hensive settlement, and he carries 
h him my full support. 

There's another regional conflict 
.t has serious implications for our 
intry's security interests: Nicaragua, 
r policy consistently has been to 
ng peace and freedom to all of Cen- 
1 America. Today four of the five 
ntral American countries choose 
dr governments in free and open 
■nocratic elections. Independent 
irts protect their human rights, and 
;ir people can hope for a better life 

themselves and their children. One 
mtry, Nicaragua, with its communist 
?ime, remains a threat to this demo- 
itic tide in the region. 

So our message to the people of 
caragua tonight is the same as it has 
en for the past 7 years: freedom 
sed on true democratic principles. In 
s past several months, there've been 
me limited steps taken by the com- 
anist regime in Nicaragua toward re- 
-m. Now is not the time to reverse 
at process. 

There's no argument that all of us 
ek peace and democracy in Nic- 
agua, and the difference is how to 
hieve that goal. On February 3d, 
ingress voted on continued support 
r the decmocratic resistance in Nic- 
agua, and to my disappointment, the 
ajority in the House of Represen- 
tives voted to remove the pressure of 



the democratic resistance on the San- 
dinista regime. However, the Senate 
agreed with me that we cannot leave 
those fighting for freedom in Nicaragua 
at the mercy of the communist regime 
and expect the process toward democ- 
racy to move ahead. 

We've already seen what happens 
when pressure is removed. In just 2 
short weeks, the Sandinistas threat- 
ened the only free press in that country 
and rejected a cease-fire proposal made 
by the mediator. Cardinal Obando, 
which incorporated the essential ele- 
ments laid out and agreed to last Au- 
gust. And in the first 2 months of 1988, 
Soviet military assistance to Nicaragua 
has almost doubled, compared to the 
same period in 1987. These do not rep- 
resent signs of peace; these remain 
troubling indications of a regime deter- 
mined to crush its opposition and 
threaten its neighbors. 

There is a choice. We must act to 
ensure that freedom is not smothered 
in Nicaragua and to guarantee that 
these latest promises will be kept in a 
timely way. 

Q. Through the years you've been 
very eloquent on the subject of hu- 
man rights in the Soviet Union and 
Nicaragua. The question really is: 
Why have you never condemned the 
treatment of the Palestinians in the 
occupied areas — shooting unarmed 
protesters, beating people to death, 
children, trying to bury some alive? 
And I'd like to follow up. 

A. We have spoken to the govern- 
ment there, and we've also spoken to 
the Palestinian leadership, because 
there is every evidence that these riots 
are not just spontaneous and home- 
grown. But we have spoken, and that's 
part of the reason why the Secretary of 
State is going back over there. We 
don't support that sort of thing, and we 
are trying to persuade all the partici- 
pants to try to arrive at a solution rep- 
resenting justice for all. 

Q. If you want that and you say 
you believe in security for Israel and 
legitimate rights of the Palestinians, 
why don't you go on the public record 
now and say that there should be an 
exchange of removal of the occupa- 
tion and of peace? 



A. I don't think it's up to us to 
dictate the settlement in the Middle 

East. 

Q. We certainly are great sup- 
porters of Israel, so we certainly have 
some influence. 

A. Yes, and we have used that a 
number of times and are using it now. 
But we think that — and the thing that 
is taking the Secretary of State there — 
we think that the necessity is for all 
who are represented in that situation, 
on both sides, should come together, 
when you stop to think that legally a 
state of war still exists there in the 
Middle East, between the Arab nations 
and Israel, and that it's time for us to 
arrive at a true peace and recognize the 
rights of all. 

Q. Shi'ite militiamen are scour- 
ing southern Lebanon for Colonel 
Higgins, the American kidnapped last 
week, and you've expressed a deter- 
mination to get him out. Can you say 
that the same intense efforts, the 
same kind of dragnet, will be used to 
find the other American hostages, 
one of whom, Terry Anderson, is 
about to mark the end of his third 
year in captivity? 

A. We have never given up on that. 
As you can realize, it's very frustrating 
to try and establish a location, know- 
ing, of course, that you are governed by 
the fact that unwise action on our part 
could bring about harm to the hos- 
tages. But we've never let up, and we 
never will, in trying to obtain the free- 
dom of all the hostages. 

Q. Pat Robertson said today that 
his Christian Broadcasting Network 
once knew the location of American 
hostages in the Middle East, and that 
the United States, in effect, missed 
an opportunity to rescue them. I un- 
derstand he's clarified that remark, 
but I wonder if you have any thoughts 
about the tone that he's setting in 
this campaign. 

A. I don't want to comment on the 
campaign, but I can only say this: that 
it would be very strange if he actually 
did have information as to the location 
of those hostages. Isn't it strange that 
no one in our Administration was ever 
apprised of that? We have tried our 
best, and through every kind of chan- 
nel, to establish their whereabouts, be- 
cause that's the beginning of efforts to 
try and get them free. But if he 
thought that he knew, he kept it to 
himself. 



THE PRESIDENT 



Q. As of now, is there any change 
in our policy of not talking with the 
PLO [Palestine Liberation Organiza- 
tion], in light of the fact that there 
are reports out of Geneva that Mr. 
[Yasir] Arafat [PLO leader] is now 
ready to accept UN Resolution 338 
and 242? 

A. I know that this is one thing 
we're pursuing. If he really is, and if he 
is willing to acknowledge the right of 
Israel to exist as a nation — this has 
been one of the blocking points, that 
how do you sit down and try to get into 
a talk about peace when someone says 
they have no right to even e.xist? And 
I'm sure that the Secretary of State is 
apprised of that fact and will see what 
we can do there. 

Q. And given the 40-year hostility 
in the area which has been built up, 
how can you as the "great commu- 
nicator" try to alleviate some of the 
antagonism between the Israelis and 
the Palestinians before you leave 
office? 

A. We are trying to and will con- 
tinue to try to. That's a goal that I 
would think would be one of the great- 
est achievements of this Administra- 
tion — if before I leave, we could bring 
about a peace in the Middle East. 

Q. Whom precisely are you criti- 
cizing when you say that the riots are 
not homegrown and not spontaneous? 

A. We have had— it's a little diffi- 
cult for me, because there are some 
things that I shouldn't be saying. But 
we have had intimations that there have 
been certain people suspected of being 
terrorists, outsiders coming in, not only 
with weapons but stirring up and en- 
couraging the trouble in those areas. 
Now, that isn't something you can go 
out and say we absolutely know, but 
certainly the violence is both ways. 

Q. But it would seem that that's 
still a generalization if you say some 
people from the outside. Can't you be 
specific and say just who is? 

A. No, because I get into areas 
there that would be violating security 
rules, and I don't think I should. 

Q. The PLO, Russians? 
A. What? 

Q. PLO, Russians? 

A. No, no. 



Q. It's my understanding that in 
1985 your national security adviser, 
Robert McFarlane, briefed you on the 
Iraqi pipeline project and gained your 
approval for it. In light of the diffi- 
culties that your Attorney General, 
Mr. Meese, is encountering now, 
could you explain your position on 
the pipeline and tell me if you think 
it was a good idea at that time? 

A. I have no recall of knowing any- 
thing about this pipeline plan until 
fairly recently, and then found out with 
regard to the transmittal of the letters 
that have now been turned over to the 
special investigator. And this was about 
the first information that I recall 
having. 

Now, I can't say to you that I was 
given information earlier, because I just 
have to tell you if I was I have totally 
forgotten — that I have no knowledge of 
anything of that kind. 

Q. Does it trouble you at all that 
your dear friend Mr. Meese has be- 
come entangled in this project, and it 
has yet been another case which has 
brought him, some would say, 
embarrassment? 

A. Let me say one thing. I have 
every confidence in his integrity. I've 
known him for more than 20 years, but 
I cannot comment in any way on his 
case that is now before a special 
investigator. 

Q. The white minority govern- 
ment of South Africa has now effec- 
tively banned activities by dissenting 
organizations, even when those ac- 
tivities are peaceful. What is your 
view on that, and what can you do, if 
anything, to reverse it? 

A. 'The State Department has al- 
ready contacted them about that, and 
we are making our own feelings clear 
that they should be working toward a 
multiracial democracy and not oppress- 
ing political organizations there. And 
we've made our feelings clear about 
that. 

Q. May I follow up? Have you 
considered sending aid to the freedom 
fighters — the ANC [African National 
Congress] or any other organiza- 
tion — against this oppression just as 
you send aid to other freedom fighters 
around the world? 

A. No, we have not involved our- 
selves in that, other than things such 
as the sanctions and so forth. We have 
tried our best to be persuasive in this 
very difficult problem and to find — or 
to encourage a better solution. 



Q. What's the difference? 

A. The difference is that we doi 
have an armed insurrection going as- 
have in some other countries, and W' 
have a great division even among thi 
people who are being oppressed. It i 
tribal policy more than it is a racial 
policy, and that is one of the most di 
cult parts here. 



I'lil 



Q. What are you doing to mak 
things easier for corporations to tr 
with the Soviet Union in nonstrate 
items, such as food processing, ph£ 
maceuticals, automotive, and hotel 
for instance? And do you believe th 
Soviet Union should join GATT, tht- 
General Agreement on Tariffs and 
Trade? And will you discuss these z< 
other trade items with Mr. Gorbach 
in your forthcoming summit? 

A. I can't relate to you discussio 
about those particular things with hi: 
But I do know that there has been c( 
sideration of them involving themseh 
in the GATT procedure; and that, of 
course, is being reviewed among thos 
of us who are participants now. But 1 
don't know whether that answers yoi 
question or not, but our trade with tl 
Soviet Union is restricted mainly on 
the basis of where we might be givin] 
them technology and information thai 
could be used one day against us. 

Q. I know you have to remain 
neutral in the Republican race, but 
you could clear up a major issue rigUi 
now by telling us whether George 
Bush, in fact, did have reservations 
about the sale of arms to Iran; 
whether he had reservations about I 
rael's role in that policy; and wheth<|t(i 
in fact, he's telling the truth when h 
tells us that he did have those 
reservations? 

A. Yes, in the general discussion, 
and that's not unusual here. I've or- 
dered our people on Cabinet matters ( 
anything else, and I want to hear wha 
they really feel. I don't want to be sur 
rounded by yes-men. And, yes, there 
were reservations, but I'm not going ti 
go into — ^just as he wouldn't go into th 
private discussions that we may have 
had. 



10 



n^r^-,rtrr,^»t ^1 Ct^t^ D..l<^tit 



THE PRESIDENT 



But I think it's time for me to point 

what the opposition was based on of 
'one who did oppose. Particularly, 
been revealed that Secretary Wein- 
ger and George Shultz both ob- 
ted. They did not object, the idea 
t we were trading arms for hos- 
es. Their objection — they knew what 
were trying to do. This had been a 
uest that came to us from some peo- 
not in the Government of Iran but 
wanted to privately meet with us 
how there could be a better rela- 
iship if and when the day came that 
re was a new government in Iran, 
d if you'll remember, back in those 
's, almost every other day there was 
:culation that the health of the Kho- 
ini was failing to where there might 
this contest of a new government. 

Their objection was — what we had 
16, we'd gotten this request; and in 
iling with it, in this conversation 
h these private individuals, we 
nted out our feelings about ter- 
ism and so forth. They agreed with 

And the thing was that they, the 
5ballah [radical Shi'ite group operat- 

in Lebanon], as we know, is philo- 
)hically attuned to Iran. The idea 
s that they could perhaps influence 
! Hizballah to give up some of our 
stages. And indeed, as the talks 
nt on, they did. We got two of them 
e. 

But their objection was that if and 
len this became known, as it would 
, it would be made to appear that we 
re trading arms for hostages. Now, 

were giving these arms to these in- 
dduals, because we felt that maybe 
jy could influence the Hizballah. We 
■ren't dealing with the kidnappers at 
. And this was what the whole situa- 
■n was. But it turned out that George 
d Cap and those who had doubts 
!re right in that when it did become 
own, by way of a henchman of the 
/atollah, then everyone just automati- 
Uy said that— and to this day are say- 
g — it was arms for hostages. 
• • • • 

Q. The resignation of Secretary of 
e Navy Webb has ignited a contro- 
rsy about your buildup of the U.S. 
ivy. And the question is: Are you 
tisfied that the budget cuts in the 
ilitary have not damaged our na- 
jnal security, and are you still com- 
itted to a 600-ship navy at a time 
hen the Soviets are not cutting their 
ivy? 



A. I am committed at the 600-ship 
navy. And I want you to know, that 
from the very beginning, since I've 
been here, the Congress has cut my 
request for defense every time. And 
sometimes, they have tried to pretend 
that that is in an effort to reduce the 
deficit spending and so forth. But in a 
5-year period, the Congress cut my de- 
fense budgets a total of $125 billion at 
the same time that they increased my 
request for domestic programs by $250 
billion. And this budget which is now 
being attributed to me — no, this isn't as 
low as they originally wanted to cut it, 
but it was as high as we could get it in 
the negotiations for the present budget. 
And it has been harmful. 

But let me tell you that in 1980, 
when we came here, the navy had 479 
vessels, and by 1987, we had 568. And 
by next year, it will be 580. And so, 
what has happened is that there will be 
a little delay in the achieving of the 
600-ship navy. But I can't help but re- 
mind — or tell all of you, when I was 
campaigning in 1980 and knew the state 
of our defenses, I was faced with the 
question. And some of you will recall I 
did a lot of campaigning on question- 
and-answer basis. At almost every 
gathering, there would be a question: 
Well, if I came to a choice between def- 
icit spending and buildup of our defense 
structure, which would I choose? And 
every time, I said, in responsibility, I 
would have to choose the buildup of our 
defenses. And every time, every au- 
dience in America that I said that to 
gave me an applause that was almost an 
ovation for saying that. 

Q. The second part of the ques- 
tion was: Is it a threat to the national 
security that the navy is not going to 
have 600 ships on the schedule that 
you had in mind? 

A. I don't think right at the mo- 
ment — and with the way we're pro- 
gressing in various treaties and so 
forth — I don't believe that the threat is 
that immediate, and because very 
shortly we will achieve our 600. We 
want 15 carriers and their squadrons, 
and we've just launched the 15th car- 
rier, 100 nuclear-powered attack sub- 
marines, and 4 battleships, and we're 
achieving that. 



Q. You must certify by March 1st 
whether Panama has been cracking 
down on drug trafficking through 
that country or whether aid to Pan- 
ama should continue to be suspended. 
What are you going to do? 

A. I can't give you the answer yet, 
because we're still working on that and 
still collecting the facts as to what their 
effort has been at trying to intercept 
the drugs and join us in that campaign. 
But as you said, March 1st we will be 
giving the answer. 

Q. Some officials in your Admin- 
istration have suggested that if Nor- 
iega [Commander of the Panamanian 
Defense Forces] would step down and 
go into exile, that you would stop the 
prosecution of him on drug charges. 
Would you consider that kind of deal? 

A. No, and I'm not going to com- 
ment on something of this kind. This 
man has been indicted by a Federal 
grand jury, and so I'm not going to 
make any comment of that kind, nor 
have we made any advances or sugges- 
tions of that kind to the Government of 
Panama. What we would like to see is a 
return to democracy and a civilian gov- 
ernment in Panama, and not this domi- 
nation by — literally — a military 
dictator. 

• • • • 

Q. Back to the contra aid ques- 
tion. In your opening statement, you 
seemed to suggest that the Sandinistas 
are taking advantage of Congress not 
coming through with contra aid to 
withdraw some of the concessions they 
had made. With Congress about to 
consider new humanitarian aid — both 
a Democratic and a Republican plan — 
is it worth it to pass humanitarian aid 
without military aid? 

A. I think the only comment that I 
can make there is that anything that 
will keep the freedom fighters as a 
pressure on the Sandinistas is worth 
doing. Just as when we tried to pass 
our own bill and narrowly failed, you 
could see that the military aid was 
down the road aways — it was not neces- 
sary right now. The other aid — human- 
itarian aid — is more imminent. And so, 
if we can get that, that's fine, and then 
we'll take our chances on the other in 
trying to get it. But they do still have 
some military store for a limited period 
of time. 



THE SECRETARY 



Q. In the two plans that are be- 
ing considered, the Democrats want 
the Defense Department to deliver 
whatever stores and supplies are au- 
thorized. The Republican plan would 
give that responsibility to the CIA 
[Central Intelligence Agency]. Do you 
favor either course? 

A. I certainly would favor the 
CIA. I think that involving our military 
when there is no need to is very rash 
and foolish, because you would be put- 
ting our military into a combat situa- 
tion, and this is what we've been trying 
to avoid in Central America all the way. 

Q. In that regard, I'd like to ask you 
about the latest hostage situation. Do 
you think it was responsible for your 
Administration to allow a Marine 
Lieutenant Colonel, William Higgins, 
to operate in southern Lebanon at a 
time when eight Americans were al- 
ready being held in that country and 
when your own State Department was 
recommending against travel there 
and considering the ramifications of 
the abduction of William Buckley 
earlier? 

A. I don't think that you can use 
that as a measure of where officers can 
be assigned to duty. They're in a dan- 
gerous business to begin with. And we 
are a part of the United Nations, and 
we have obligations to the United Na- 
tions with regard to the UNIFIL force 
[UN Interim Force in Lebanon] that 
has been there for a number of years 
now. And this particular officer hap- 
pened to volunteer when there was a 
vacancy at that spot — volunteered for 
that. And I think that we have the con- 
fidence — and I do have the confidence 
in men like him — that someone would 
have a hard time getting secrets that 
could harm this country from a person 
of that kind. 



'Te.xt from Weekly Compilation of 
Presidential Documents of Feb. 29, 1988. 



Meeting Our Foreign Policy Goals; 



Secretary Shultz's prepared state- 
ment before the Subcommittee on For- 
eign Operations of the House 
Appropriations Committee on March 
10, 1988.'- 

I am pleased to come before the sub- 
committee to discuss the foreign opera- 
tions component of our FY 1989 budget 
request. The funding we are requesting 
complies with both the letter and the 
spirit of the budget summit compro- 
mise. It is the bare minimum we will 
need to support our fundamental for- 
eign policy objectives and interests. We 
would have preferred more. We can't do 
the job with less. 

From the outset, President Reagan 
has been guided by the conviction that 
the United States must remain a fully 
engaged force around the globe for 
peace, prosperity, democracy, and hu- 
manitarian values. We have been mak- 
ing impressive strides in fulfilling these 
goals. 

At the core of our diplomacy are 
our efforts to ensure the strength and 
unity of our alliance relations, the effec- 
tive management of East- West issues, 
the peaceful resolution of regional con- 
flicts, and the advancement of our 
broader security and economic inter- 
ests. With our tangible support and en- 
couragement, democratic and free 
market values are gaining strength 
among the peoples of Latin America, in 
the Philippines, in Korea, and in Af- 
rica. That's good news for everybody. 
Countries with free people, free elec- 
tions, and free markets aren't the coun- 
tries that threaten our security. 
Democratic countries respect the rule 
of law both at home and abroad; they 
are more stable internally from both an 
economic and a political standpoint; and 
they are more capable of resisting ag- 
gression through their own efforts. 

Our achievement of the historic 
INF [Intermediate-Range Nuclear 
Forces] Treaty offers convincing proof 
that success in advancing our peaceful 
objectives depends not only on cohesion 
and clarity of purpose but also on the 
political will to provide the means nec- 
essary to meet our objectives. The 
treaty would not have been possible had 
we or our allies balked at the economic 
or political costs of countering the So- 
viet SS-20 menace. 



Working for peace means buildir 
up and sustaining our military strenj 
and that of our friends while concur- 
rently engaging in hard-nosed diplo- 
macy. The daily effort to defend our 
security, to establish more stable anc 
workable relations with our adversar 
ies, to ensure continued economic 
growth, and to achieve negotiated se 
tlements in strife-ridden areas is a 
costly exercise. But, instability and \ 
are even costlier and not just in mon^ 
tary terms. 

It is, indeed, ironic that just wht 
the need for effective U.S. leadershij 
in the world is increasing and we are 
scoring remarkable successes, we fin^ 
that we lack adequate means and 
enough fle.xiblity either to advance oi 
interests or to meet our commitment; 
to friends and allies. 

The realities of our time dictate 
that the United States cannot achievt 
our interests and objectives alone, no 
can we do so with insufficient re- 
sources. Other countries around the 
world cannot adequately protect thei: 
security, ensure their domestic welfai 
or protect their democratic institutioi 
absent the active support of the Unit 
States. 

And, especially now, when the d; 
gers of terrorism and the broad rangi 
of threats to many societies posed by 
international narcotics trafficking are 
becoming so stark, we must marshal 
the means necessary to counter these ^ 
assaults on human dignity and civilize 
society. I have committed the State Dfi 
partment — and you have my personal 
commitment — to use every opportunit 
and every resource at our disposal to 
combat these twin scourges. 

East-West Relations 



The United States and our allies have 
set in motion a number of efforts that 
could, with Soviet cooperation, bring 
major strides toward a safer, more se- 
cure, and more humane world. Will we 
have that Soviet cooperation? Yes, we 
will, if we shape the right conditions. 
And how do we shape these conditions 
By being fully and actively engaged 
and by committing the necessary 
resources. 

The critical importance of world- 
wide U.S. engagement came through 
loud and clear to the President during 
his recent meetings with his NATO 
counterparts. In Brussels, we and our 



'i 



12 



nsnartrnpnt nf qtatp Rnllptuji. 



THE SECRETARY 



rO partners agreed that if we ex- 
t to advance our agenda with the 
.t, we must demonstrate the same 
)lve and be prepared to commit sim- 
ly vital resources as we did in our 
suit of the INF Treaty. 

That agenda includes greater 
nness and full respect for human 
its in the East and on arms control: 
;e priority tasks — 50% reductions in 
nsive strategic arms, a global and 
y verifiable ban on chemical weap- 
, and correction of the imbalance in 
ventional forces. 

Realism, strength, and dialogue 

remain America's watchwords as 
continue the high-level exchanges 
■un in 1985 with the Soviet lead- 
hip. Through this ongoing process, 

relationship with the Soviet Union 
ow developing on a more stable and 
structive basis. I will be meeting 
ularly with Foreign Minister Shev- 
nadze in the period leading up to 
next summit in Moscow. 

We will pursue the full range of 
les that concern us, including human 
its, arms control, bilateral matters, 
I settlement of regional conflicts. We 
1 continue vigorously to challenge 
Soviet Government to respect the 
nan rights and fundamental free- 
ns of people in the U.S.S.R. as well 
the sovereign rights of its neighbors, 
will pursue progress toward a 
ART [strategic arms reduction talks] 
aty — the President has made clear to 
of us that he wants no letup in our 
Drt to achieve a good treaty. 

gional Issues 

^^hanistan. After 8 long years, the 
irage and tenacity of the Afghan re- 
tance and people may be about to 
r off in the resumed negotiations at 
neva. We are proud to stand with 
im and with Pakistan. The United 
ites will continue its support for 
dstan and for the Afghan people and 
1 continue to press Moscow to with- 
iw its troops expeditiously and cease 
itary assistance to the Kabul re- 
le. The United States remains fully 
1 firmly committed to a rapid depar- 
■e of Soviet forces, the restoration of 
jhanistan to an independent and 
laligned status, genuine self-deter- 
nation for the Afghan people, and re- 
■n of the refugees in safety and 
lor. 



The Middle East. In the Middle 
East, this is a time of decisions. The 
situation on the ground does not serve 
anyone's interests, and rapid change 
through negotiations must occur. My 
discussions with the leadership in Is- 
rael, Jordan, Syria, and Egypt focused 
on the need for realism in our approach 
to negotiations. 

The approach we are pursuing is 
ambitious and compelling. It calls for 
an early start of interlocked negotia- 
tions on transitional arrangements and 
final status. These will be launched and 
supported by a properly structured in- 
ternational conference. This process can 
and should begin as early as mid-April. 
The mechanics of our approach meet 
everyone's fundamental concerns and 
provide for serious negotiations. 
But the mechanical aspects of this are 
secondary to what can be accomplished. 
Our objective is a comprehensive peace. 

• Israeli security can be enhanced. 
Israel can enjoy the recognition and re- 
spect which flow from negotiations. Is- 
raelis can be free from the increasing 
human and moral burdens of occupa- 
tion — free to devote their considerable 
talents and energies to improving their 
quality of life. Most important, Israel 
can achieve peace with its neighbors. 

• Palestinians can achieve rapid 
control over political and economic deci- 
sions which directly affect their lives. 
Palestinians can participate actively in 
negotiations to determine their political 
future. Palestinians can achieve their 
legitimate rights and live lives of dig- 
nity and self-respect. 

• The Arab world can turn a 
corner, resolve this festering conflict, 
and get on with the business of meeting 
human needs. The refugee problem can 
be solved. A stable new environment 
can be created in which the human and 
economic resources of the Middle East 
can flourish. 

This is a moment of testing for the 
leaders of the Middle East. All must 
face up to the challenge of peace and 
beat back the forces of radicalism. Vio- 
lence and threats achieve nothing. They 
stand in sharp, empty contrast to what 
negotiations can accomplish. 

No resolution of this conflict can 
fulfill all dreams. Compromise is re- 
quired. The plan we have put forward is 
compelling. It is an integral whole. We 
have asked for decisions soon, so that 
we can proceed rapidly toward a com- 
prehensive peace. 



Central America. In Central 
America, we must be equally realistic 
and determined in our efforts. The 
cause of peace, stability, and democracy 
in Central America — already severely 
challenged by the Sandinista regime in 
Nicaragua and its Cuban and Soviet al- 
lies — received another blow recently 
when General Noriega refused to ac- 
cept his suspension as head of the Pan- 
ama Defense Forces. The United States 
has rejected Noriega's attempted dis- 
missal of President Delvalle — a dis- 
missal which is, in essence, a coup 
d'etat without a visible military 
presence. 

What we face in Panama is a threat 
to democracy; a threat to our ability to 
stop the international drug traffickers; 
a threat to the safety and stability of 
this hemisphere. We will not shirk our 
responsibility to defend ourselves 
against this triple threat — to stop the 
drug dealers, the tyrants, and the 
terrorists. 

Our policy in Panama is straight- 
forward and consistent: we support 
fully and unequivocally the government 
of President Delvalle. And so do many 
others. Just this week. President Del- 
valle received enormous support from 
a broad spectrum of the Panamanian 
opposition. They made a commitment to 
unity for democracy. We applaud that 
effort. 

The struggle for democracy in Pan- 
ama also has received widespread sup- 
port from the other democracies in this 
hemisphere. Perhaps El Salvador's 
President Duarte put it best when he 
said: "El Salvador, as a democratic na- 
tion, will never agree to a solution 
based on abuse of power and imposition 
of Noriega's dictatorship on the Pan- 
amanian people." 

We and the democratic world will 
do what is necessary to help democratic 
government survive and bloom in Pan- 
ama. We will continue actively to coop- 
erate with President Delvalle and his 
government in their efforts to reassert 
legitimate civilian authority. 

The deteriorating situation in Nic- 
aragua further illustrates my point that 
failure of the United States to mate- 
rially reinforce democratic government 
and efforts to gain a peaceful settle- 
ment to conflicts in Nicaragua and El 
Salvador can only harm our own se- 
curity interests. Unless we back up our 
policies with adequate resources, our 
friends and foes alike around the world 
will conclude that America's words lack 
substance; our commitments, cred- 
ibility; and our plans, effective 
execution. 



wJO»» 



13 



THE SECRETARY 



Since Congress ended U.S. as- 
sistance to the Nicaraguan resistance, 
the Sandinistas have once again re- 
verted to their true totalitarian goals. 
Their repression and intransigence have 
increased. Two weeks ago, the San- 
dinistas rejected proposals by Cardinal 
Obando y Bravo, the mediator they 
themselves selected, to further the 
plan. Those proposals had been immedi- 
ately accepted by the representatives of 
the resistance. Then, the Sandinistas 
informed Cardinal Obando that his serv- 
ices as mediator are no longer required. 
Just recently, the communists balked 
again and postponed a meeting with the 
resistance. Sandinista mob violence 
against Nicaraguan citizens has in- 
creased dramatically in recent weeks. 

It is time for the Congress to sit 
up and take notice: the Sandinistas are 
brutalizing their own people. Those 
who may have believed that cutting off 
aid to the freedom fighters would help 
achieve peace and freedom have made a 
grave mistake. They must undo the er- 
ror before it is too late. As Violetta de 
Chamorro, the head of Nicaragua's 
leading opposition newspaper, recently 
wrote President Arias: "The Sandinista 
regime, taking advantage of the sus- 
pension of military actions by which it 
had been besieged, has entered into a 
phase of total indifference" to the terms 
of the Guatemala agreement. 

Persian Gulf. Elsewhere in the 
world, an engaged U.S. presence and 
our sustained support remain essential 
to international stability and well-be- 
ing. In the strategic area of the Persian 
Gulf, our reflagging policy is protecting 
basic U.S. interests, and allied govern- 
ments are following our lead. We will 
continue to stand by the security com- 
mitments we have made to our friends 
in the region. We are at the forefront of 
international efforts to bring an end to 
the Iran-Iraq war via UN Security 
Council Resolution 598. We are working 
within the Security Council to adopt an 
enforcement resolution imposing sanc- 
tions against Iran as long as it refuses 
to comply with 598. And we are con- 
tinuing our own active efforts to 
staunch the flow of arms to Iran. 

East Asia. In East Asia, the re- 
markable worldwide trend toward dem- 
ocratic government has had two notable 
successes in the Philippines and South 
Korea. 



We are supportive of the major 
steps the Republic of Korea has taken 
toward full democracy over the past 
year We are cooperating fully with 
South Korea as it strives to host the 
1988 Olympics in a secure and peaceful 
atmosphere. And we are assisting Pres- 
ident Aquino in leading her nation in 
building democracy and accelerating 
economic growth as the Philippines con- 
tends with a virulent communist insur- 
gency. The struggle against communist 
aggression is evident in Cambodia. We 
are supporting ASEAN [Association for 
South East Asian Nations] and the 
Cambodian noncommunist resistance in 
their efforts to bring about a political 
solution to the Cambodian conflict en- 
compassing a complete Vietnamese 
troop withdrawal from Cambodia and 
self-determination for the Cambodian 
people. 

Southern Africa. Apartheid is at 
the heart of South Africa's problems 
and is a principal source of instability 
in the southern African region. Our 
goal remains its rapid and peaceful 
demise. To that end, we are working to 
foster negotiations among all elements 
of South Africa's population that will 
lead to the creation of a democratic so- 
ciety with equal rights for all. At a 
time when the misguided actions of the 
South African Government are stifling 
the interplay of ideas so essential for 
the evolution of a free society, and iso- 
lating South Africa from the free 
world, we must do all we can to keep 
dialogue alive and new ideas coming in. 

Despite the recent serious escala- 
tion of repression in South Africa, we 
remain firm in our belief that this can 
best be accomplished through a mix of 
diplomatic and political pressures on 
the one hand and a series of positive 
initiatives on the other. It is critically 
important that we maintain strong sup- 
port for U.S. programs designed to as- 
sist victims of apartheid and to 
empower black South Africans to 
achieve their own peaceful liberation 
through higher education and growing 
economic leverage. We are working 
with our democratic allies to exchange 
data on assistance programs and to ex- 
plore ways of assuring a free flow of 
information to South Africa in the face 
of rising censorship and repression. 

Elsewhere in the region, we are 
continuing our efforts to achieve a ne- 
gotiated settlement involving with- 
drawal of all foreign military forces 
from Angola and Namibia and the 
achievement of Namibian independence. 



,W 



lent, 



at 



We now look to the Angolans to mah f 
concrete their professions of support S" 
a phased complete withdrawal of Cu) k 
forces and to South Africa to honor ii 
commitments under UN Security Co * 
cil Resolution 435. To promote econo: ^' 
independence and stability througho« P 
the region, we also strongly support 
the work of the Southern African De fe 
velopment Coordination Conference i''^' 
(SADCC). In addition to bilateral aio ^51 
we are providing SADCC with $50 n »t 
lion in assistance for FY 1988. -'T 

International Economics. In th '.j 
field of international economics, we a^ |,, 
entering a new era. The world econo 
is changing profoundly as new techni- 
gies are developed and the capability 
apply them is spreading to all region, 
of the globe. National boundaries an 
becoming increasingly irrelevant as { 
duction, finance, technology, and knc 
edge become increasingly globalized, 
order to make the most of the changr 
now underway, America must first ei 
sure that our economic and social in- 
stitutions are prepared and willing t( 
compete in this new global economy. 
We must promote policies that enabL 
market forces to direct international 
patterns of trade and financial flows. 
And, along with our allies in the indi i 
trial world, we must keep our sights f 
sustainable, noninflationary economic 
growth as the principal objective of e 
nomic policy. 

The Specifics of Our Funding Requ<'|ii 

This brief review of the foreign policy 
challenges that face us is enough to 
show how busy this Administration w » 
be in the coming year. If this Admin- i 
istration — any administration — is to r 
alize America's fundamental foreign 
policy objectives, it must have both a( 
equate funding and sufficient flexibilit 
to use financial resources to best 
advantage. 

But, today, in a time when our ac 
tive engagement is more important 
than ever, a steady erosion of our re- 
sources and severe constraints on our 
ability to apply them threaten our lea( 
ership position and our vital security, 
economic, and humanitarian interests 
the world. 

For foreign affairs, or Function 15' 
in toto, we seek $18.1 billion in discre- 
tionary spending authority for FY 1981 
The foreign operations component of 



our budget request includes most form 
of foreign assistance (excluding only P 
480 food aid) and is the largest single 



14 



j^saaiiaaai^L^tii^Sullaik 



THE SECRETARY 



ponent of our request as a whole. 

funds we make available under this 
ding help our friends and allies, 

first and foremost, they serve 
erica's own interests abroad. 

We seek a total of $14 billion for 
ign operations. The discretionary 
nent, that is to say funding for ev- 
hing except the Guarantee Reserve 
d and Foreign Service retirement, 
Is $13.3 billion, or 73% of our entire 
aest for foreign affairs appropria- 
s. This also represents an increase 

the comparable FY 1988 level of 
ut 2%. 

Let me emphasize once again that 

modest request in no way reflects 
diminution in the scope of our for- 
1 affairs interests or in the depth of 
commitments to friends, allies, and 
international system. Rather, our 
f tight request reflects a compro- 
e between our foreign policy needs 

our recognition that we must play 
part in reducing the budget deficit. 

Let me try to put this discussion in 
•oader perspective by describing 
' the foreign assistance resources we 
k serve our national goals and val- 
— and commitments to allies and 
nds. 

:ional Security 

we have seen, the unwavering com- 
ment of our allies to America's se- 
ity — and ours to their own — is 
sntial if we are to maintain the de- 
sive framework which protects us 
Many of our friends in the develop- 
world lack the resources to see to 
ir national security while at the 
le time they are struggling to pro- 
e for the basic economic needs of 
ir own people. Because we know 
t they must do both if they are to 
vive and grow, we give these nations 
nomic support and help them fi- 
ce the modernization of their armed 
;es. We also provide defense and 
nomic support to some of our NATO 
;s to help them to modernize their 
itary forces and to grow eco- 
lically. The enhanced capabilities 
ch result from our assistance con- 
lute directly to the common defense. 

For FY 1989, our total request for 
;retionary military assistance fund- 
under Title III of the bill (MAP, 
S, IMET [Military Assistance Pro- 
m. Foreign Military Sales, Interna- 
lal Military Education and Training], 

peacekeeping operations) is $5 bil- 
.. That compares with $4.8 billion in 
1988 and $5.1 billion in FY 1987. In 



percentage terms, the increase is under 
4%; however, if the Congress refrains 
from the massive earmarking which 
characterized FY 1988 military as- 
sistance programs, we should be able to 
restore funding to the dozens of key 
friends and allies from which we were 
forced to terminate funding in FY 1988. 

Despite the small increase relative 
to FY 1988, what we are seeking for 
military assistance is still below the 
level appropriated in FY 1987. The per- 
centage reductions from the levels ap- 
propriated in FY 1985 and 1986 are 
even more severe. 

For the two major military as- 
sistance accounts — Foreign Military 
Sales and Military Assistance Pro- 
gram — we are requesting respectively 
$4.5 billion and $467 million. Due to the 
major debt burdens which many se- 
curity assistance recipients face, we 
plan to provide all FMS and ESF [Eco- 
nomic Support Fund] resources on a 
grant basis. 

The switch from credits to grants 
in our FMS program represents a ma- 
jor improvement in the quality of the 
assistance we are providing. By provid- 
ing the assistance in the form of for- 
given FMS credits, those countries 
with the bureaucratic infrastructure ca- 
pable of doing so will be able to apply 
FMS funding to commercial purchases, 
a process that is not possible under 
MAP, which is strictly government to 
government. This all-grant program ini- 
tiative is consistent with a trend which 
began in the Congress a few years ago. 
In 1985, Congress, for the first time, 
permitted concessional, on-budget FMS 
programs. Two years later, it expanded 
this authority by authorizing the Ad- 
ministration to make all FMS programs 
concessional, except, of course, those 
programs for Israel and Egypt where 
repayment was forgiven. And in the 
current fiscal year, Congress again lib- 
eralized FMS by permitting forgiven 
FMS progi-ams to Pakistan and Turkey. 

Our present efforts to reinvigorate 
the Arab-Israeli peace process under- 
score the critical importance of the 
Middle East to the United States. Is- 
rael and Egypt, two key partners in 
the Middle East process, will receive 
the largest component of our security 
assistance (i.e., military assistance and 
Economic Support Funds) in FY 1989 
($5.1 billion or 62% of the total), just as 
they have for the past several years. 
Our security and economic assistance 
programs to Israel and Egypt have 
played a key role in keeping peace in 
these areas. 



In the West Bank and Gaza, our 
foreign assistance funding is direct evi- 
dence of our determination to help pro- 
duce a better life for the people of the 
occupied territories. Of the $12.5 mil- 
lion in ESF we seek for Middle East 
regional programs, $7.5 million would 
be channeled through private voluntary 
organizations in the West Bank and 
Gaza. And, of our $18 million ESF re- 
quest for Jordan, $6 million is for ac- 
tivities in the West Bank. 

In addition to the funds for Israel, 
Egypt, and the occupied territories, we 
are also requesting an additional $196 
million in this bill in assistance for our 
close friends Tunisia, Jordan, Oman, 
and Morocco, thereby furthering the 
prospects for stability and growth in 
the region as a whole. Security as- 
sistance is also used to strengthen the 
defenses of friends and allies which pro- 
vide us with access to military facilities 
in the interests of their own security 
and ours. During the past few years, 
and particularly in FY 1988, cuts in our 
budget requests and extensive ear- 
marking have combined to make it 
impossible for us to meet our "best 
efforts" commitments to some countries 
or to provide the level of support neces- 
sary for countries to perform effec- 
tively in the defense area. For 
Portugal, our assistance is well below 
the "best efforts" commitment we un- 
dertook when we signed the current 
base agreement; this situation recently 
has led the Portugese Prime Minister 
to request consultations on the agree- 
ment. Assistance to Turkey is already 
hundreds of millions of dollars below 
the level necessary if our Turkish allies 
are to meet their NATO commitments. 
Our assistance to Greece has fallen one- 
third below the level provided following 
the signing of our 1983 base agreement. 

Our FY 1989 budget request will 
not accommodate enough to make up 
for past shortfalls. We must begin to 
reverse the downward trend. There- 
fore, for these three countries we are 
requesting $1.1 billion in FY 1989. 

In the Philippines, our assistance 
program has been directed toward help- 
ing a struggling ally revitalize democ- 
racy, beat back a communist 
insurgency, and promote economic 
growth. Because of the extraordinary 
challenges faced by President Aquino in 
recent years, we have been able to pro- 
vide significant assistance levels that 
are crucial to the success of her pro- 
grams. Despite budget stringencies, we 
cannot lose sight of the important mu- 
tual security interests at stake in the 
Philippines and the need for substantial 
support. 



' iQ«ft 



15 



THE SECRETARY 



I would note that we will shortly 
undertake with the Philippine Govern- 
ment the 5-year bilateral review of our 
bases agreement. We look forward to 
its successful completion, which would 
set the stage for an extension or re- 
negotiation of the bases agreement, the 
fixed term of which ends in 1991. 

Central America is of vital impor- 
tance to the United States because of 
its geographic proximity and strategic 
position. We have long recognized that 
the best way to protect our interests in 
the region is to pursue a multifaceted 
policy aimed at promoting regional se- 
curity, democratization, and social and 
economic development. We are request- 
ing approximately $900 million in FY 
1989 to serve these ends. 

With respect to Nicaragua, in par- 
ticular, the Administration continues to 
seek funding from Congress for the 
contras. At the same time, we will con- 
tinue our varied forms of assistance to 
our friends in the region. In the event 
the current efforts to secure peace and 
substantially ease the repression in 
Nicaragua fail, our provision of security 
assistance to the other countries in the 
region will serve as a bulwark against 
spreading instability. 

Promoting Prosperity and 
Development 

Ensuring our domestic prosperity in to- 
day's increasingly integrated world 
economy requires us to do more than 
keep our own economic house in order. 
It means assisting other countries to 
develop their own economies. In this 
way, we develop in the global economy 
a growing demand for U.S. goods and 
services. American growth and pros- 
perity are, more than ever, influenced 
by conditions abroad. I am not just 
speaking of conditions in Western 
Europe and Japan, important though 
they may be, but of those in the devel- 
oping countries as well. These countries 
take over a third of our exports. The 
production of 1 out of every 20 workers 
in our manufacturing plants and 1 out 
of every 5 acres of our farmland is sold 
in Third World markets. 

By promoting economic develop- 
ment abroad we make a direct contribu- 
tion to our own economic well-being. 
Current economic stagnation in a large 
number of developing countries, espe- 
cially those with heavy debt burdens, 
illustrates the point vividly and pain- 
fully. For example, between 1981 and 



1986, the countries of Latin America 
and the Caribbean experienced sharp 
declines in their real incomes. Our ex- 
ports to that region dropped by over 
$11 billion. For the same reason, in Af- 
rica, our exports dropped by $2.8 bil- 
hon. In contrast, our significant role in 
the development of Pakistan has paid us 
dividends. In 1960, Pakistan's per capita 
income was barely $100. By 1985, 
Pakistan had more than doubled its in- 
come and had become a major pur- 
chaser of U.S. products. Since 1979, 
U.S. exports to Pakistan have risen by 
more than half. 

We are requesting appropriations 
of $7.6 billion for bilateral and multi- 
lateral economic assistance programs 
(including ESF). That constitutes al- 
most 60% of our total discretionary for- 
eign operations request. It includes 
development assistance, voluntary con- 
tributions to international organiza- 
tions, assistance provided through 
multilateral development institutions, 
the Peace Corps and other bilateral as- 
sistance programs, as well as $3.3 bil- 
lion for ESF. ESF serves economic 
stability and development as well as se- 
curity objectives. 

Again, we seek only a modest in- 
crease of $80 million, or 2.5%, in ESF, 
but we enjoin Congress to refrain from 
the massive earmarking which required 
us in FY 1988 to eliminate funding for 
numerous countries, particularly in 
South America and the Caribbean. Our 
allocation of the ESF request would al- 
low resumption of important programs 
in Jamaica, the Dominican Republic, 
Ecuador, and throughout the region. 

In addition to ESF, economic as- 
sistance takes many forms: 

• Development assistance ($1.6 bil- 
lion, including the new Development 
Flind for Africa) to fund projects ad- 
ministered by the Agency for Interna- 
tional Development (AID) in such areas 
as agriculture, education and human re- 
sources development, health, nutrition, 
and private sector development; 

• Funding for the multilateral de- 
velopment banks (MDB) — $1.3 billion: 
$70 million will go to the World Bank as 
the first installment of our contribution 
to the new General Capital Increase 
which, together with the contributions 
of others, will support $75 billion in 
new Bank project lending and support 
of growth-oriented structural adjust- 
ment and policy reform. The largest 
component, $958 million, will be used 
for a U.S. contribution to the eighth 
replenishment of the International De- 



ft 



:»« 



velopment Association (IDA). IDA isi 
the "soft" loan window of the World 
Bank which finances development ac- 
tivities in low-income developing cout^Btai 
tries and, sometimes in conjunction 
with the International Monetary FunAei 
(IMF), supports essential economic p« 
icy reform in these countries. Becausi 
of the budget summit ceiling, none of j 
these funds will be used to pay U.S 
arrears (currently about $400 million) itai 
to any of the multilateral developmen to! 
banks. MED arrears raise serious qui m 
tions about our credibility, and we wi am 
have to address the arrears problem i [iiii 
FY 1990; '^i 

• Funding for Peace Corps pro- ItJng 
grams — $150 million; and J^:' 

• Voluntary contributions to such 
international organizations as the UN 
Development Program ($110 million) ^,<i 
and UNICEF [UN Children's Fund]-ilit( 
$31 million. Li 

Our domestic prosperity is also fi 
thered by helping U.S. exporters con . 
pete with financing arrangements r' 
offered by foreign governments. For j 
this purpose, we are requesting $705 f 
million for the Export-Import Bank's f 
(Eximbank) direct credit programs. 
These programs provide U.S. exporti 
the financial support they need to 
match foreign officially supported ex- 
port credits. Eximbank financing is a 
critical in markets in which commerci 
financing is limited or unavailable be- ' 
cause the risk is too great for commei ^' 
cial banks. r 

lei 
Promoting Democratic and Human- 
itarian Values 

The American people fully support ou 
efforts to strengthen democracy aroui 
the globe. The United States has a vi- 
tal stake in promoting democratic val- 
ues around the world and supporting 
new and growing democracies. Demo- 
cratic institution-building is a slow am 
difficult process. Fragile new democ- 
racies face daunting political, economi 
and military challenges that we must 
help them meet with more than mere 
words of encouragement. 

In Central America and the Carib 
bean, our support for democratic force 
has shown good results. Democratic in 
stitutions are taking root in countries 
where just a few years ago many de- 
spaired of that ever happening. These 
new democracies desperately need our 
help. The President's Caribbean Basin 
and Central America Initiatives, basecf 
on the recommendations of the Nation;| 
Bipartisan Commission on Central \ 



16 



noncrtmont r.f C»oi^ R.illotifi, 



THE SECRETARY 



lerica, provide comprehensive strat- 
es for such support. For FY 1989, 

are requesting $643 million in eco- 
nic assistance (not including PL 480 
d aid) for the countries of Central 
lerica and $148 million for those of 

Caribbean. 

The United States is never more 
e to its most cherished values than 
ten we defend human rights and hu- 
initarian values abroad. In our tur- 
l.ent and often cruel world, the 
|"ense of human rights means more 
in just speaking up, although speak- 
i: up in itself is important. We must 
to provide funds to help the refugees 
jeing oppression and the populations 
/astated by want and disaster. 

Over the past few years, the as- 
tance we have provided has meant 
! difference between life and death 

literally millions of Africans who 
ed the worst drought and famine the 
itinent has experienced in this cen- 
•y. During the crisis, the United 
ites provided 2.2 million metric tons 
food aid at a cost of over $1 billion; 
other $150 million was spent to pro- 
le medicines, shelter, wells, and the 
ler immediate needs for those worst 
ected by the drought. This was all in 
dition to the regular economic as- 
tance we provided during the same 
riod. 

Similarly, we assisted Colombia at 
; time of its volcanic disaster, we con- 
buted to major earthquake relief 
brts in San Salvador and Mexico 
ty, and we helped to combat locust 
"estations in 17 African countries. Our 
pport for the World Health Organiza- 
m and UNICEF has helped rid the 
irld of some of the most deadly and 
ntagious diseases and has dramat- 
illy reduced infant mortality. 

We can be proud of America's re- 
rd of assistance to the world refugee 
pulation. Since the passage of the 
ifugee Act of 1980, the American peo- 
; have offered new homes to more 
an half a million refugees — a greater 
mber than has been provided by all 
ler resettlement countries combined. 

For FY 1989, we are requesting 
40 million for migration and refugee 
sistance, less than $2 million more 
an the FY 1988 appropriation. Of that 
tal, we plan to allocate $217 million 
• relief assistance for refugees in first 
ylum camps around the world admin- 
ered by such agencies as the UN 
gh Commissioner for Refugees, the 
ternational Committee of the Red 
'oss, and the UN Relief and Works 
jency. An additional $115 million will 
available for refugee admissions to 



the United States for a minimum of 
68,500 refugees — the same number as 
in FY 1988. Since we will have fewer 
dollars than we do this year to admit at 
least the same number of people, we 
will have to reduce the services we pro- 
vide to these refugees. If we did not do 
so, we would have to cut down on ad- 
missions at a time when the pressure of 
admissions is growing, given the likely 
increases in refugees from Vietnam, the 
Soviet Union, and Cuba, and perhaps 
other countries as well. 

Combatting International Narcotics 
Trafficking and Terrorism 

Since 1981, stemming the flow of nar- 
cotics into the United States has been a 
foreign policy issue of the highest pri- 
ority for the Reagan Administration. 
As we have seen graphically in Colom- 
bia, and most recently in Panama, in- 
ternational narcotics trafficking poses a 
threat not only to the health and wel- 
fare of our citizens but to the national 
security of democratic governments 
throughout the world. And the threat 
continues to grow. 

For FY 1989, we are requesting 
$101 million for international narcotics 
control, an increase of only $2.25 mil- 
lion from the amount appropriated in 
the continuing resolution for FY 1988. 
This budget includes $31 million in di- 
rect assistance to Colombia, Bolivia, 
Peru, Ecuador, and Venezuela. Our nar- 
cotics control strategy gives top pri- 
ority to helping key Latin American 
and Caribbean countries stop cocaine 
trafficking. Airlift capacity — meaning 
helicopters and planes to support aerial 
and manual eradication of coca and for 
transporting police and paramilitary 
troops on raids against cocaine labs — is 
crucial in the Andes. We plan to use 
another $18 million to provide aircraft 
and maintenance support. 

These programs constitute only a 
part of our total effort to control inter- 
national drug trafficking. Our direct as- 
sistance to many foreign governments 
and private self-help organizations lets 
them carry out public awareness pro- 
grams and projects to find alternative 
crops for farmers who now depend on 
growing drug crops for their livelihood. 
We are also strengthening the ca- 
pability of military forces to eradicate 
fields and destroy drug labs. 

International terrorism, like inter- 
national narcotics trafficking, offends 
the most cherished humanitarian values 
of democratic societies and poses a seri- 
ous threat to international stability. 



Through long and often bitter experi- 
ence, we have developed an effective 
policy to deal with this modern day bar- 
barity. We have developed a better un- 
derstanding of terrorist methods. We 
are working closely with other coun- 
tries, in part by pooling intelligence re- 
sources. We are also working to 
persuade countries reluctant to cooper- 
ate in combatting international ter- 
rorism of the error of their ways. We 
are providing training and training-re- 
lated equipment to those with the will 
but not the means to cooperate. We 
have strengthened security measures to 
protect our citizens at home and 
abroad. And we have gone on the offen- 
sive to bring terrorists to justice, dis- 
rupt their operations, and destroy their 
networks. But we must remain pre- 
pared and vigilant. 

In 1987, we counted 832 interna- 
tional terrorist incidents. Among the 
casualties, over 600 were killed and 
2,200 wounded. These figures tend to 
understate the actual level of terrorist 
activity, since incidents confined to one 
country, with the nationals of only one 
country involved, are not included. 

U.S. programs to enhance the 
counterterrorism skills of other nations 
consist of training and provision of 
equipment and logistical support. These 
efforts are coordinated by the State 
Department and are carried out by the 
Departments of State, Defense, and 
Justice; the intelligence community; 
and other concerned agencies. For FY 
1989, we are requesting $9.8 million to 
continue the Department of State's 
Antiterrorism Assistance Program. 
With the requested funds we will be 
able to train some 1,500 security of- 
ficers from around the world in a vari- 
ety of antiterrorism skills. These 
officers are selected for training be- 
cause they have major responsibilities 
for the security of embassies, Ameri- 
cans living abroad, and travelers. They 
will join a group of nearly 6,000 other 
officials from 46 countries who have re- 
ceived antiterrorism training during the 
first 4 years of this program and who 
are now cooperating with us in our 
counterterrorism efforts. 

The Need for Resource Flexibility 

To meet all of these major foreign pol- 
icy objectives, we will need more than 
your support for our total funding re- 
quest, which is already at the bare- 
bones level. We will also need legisla- 
tion that gives the executive branch the 



17 



THE SECRETARY 



latitude we need to manage the very 
limited resources we have effectively. 

The continuing resolution for FY 
1988 does not give us that flexibility. In 
the security assistance area, almost 
95% of the total appropriation is ear- 
marked for particular countries or pro- 
grams. Of course, in many instances 
congressional earmarks are consistent 
with the levels we recommended and 
represent a congruence of views be- 
tween the Administration and the Con- 
gress regarding the priority of 
particular programs. 

But the overall effect of massive 
earmarking in the context of sharp cuts 
across the board is to place the burden 
of those cuts disproportionately on pro- 
grams which must be funded from the 
5% of the budget which is not ear- 
marked. We have been forced to cut 
drastically ESF, MAP, and/or FMS pro- 
grams to such staunch friends as Tur- 
key, Portugal, El Salvador, Honduras, 
Jordan, Kenya, Somalia, and Zaire. 
Moreover, we have been forced to elimi- 
nate entirely programs in a whole host 
of other countries, particularly in South 
America, the Caribbean, and Africa. 

If we are given the needed flexibil- 
ity, the levels of funds in the budget 
request for FY 1989 will enable us to 
reconstitute on a modest scale many 
programs we had to curtail or cut off 
this year. And, what is the alternative? 
Can the United States withdraw its 
support for long from so many areas of 
the world and still protect the security, 
ensure the prosperity, and promote the 
democratic values of the free world? My 
answer is an unequivocal no. We could 
debate the point here in the comfort of 
a committee room, but out there in the 
world, I can assure you that we will not 
have the luxury of making the wrong 
choice. 

Conclusion 

In closing, I would like to draw your 
attention to the American eagle on the 
seal of the United States. I am fond of 
pointing out that our internationally 
recognized symbol is clutching an olive 
branch in one set of talons and a bunch 
of arrows in the other The eagle's head 
is turned in the direction of the olive 
branch. Our far-flying eagle is grasping 
both olive branch and arrows because 



America must commit military strength 
to the service of peace if we are to 
remain true to our values and advance 
our interests abroad. 

Today I have described the particu- 
lars of an austere foreign operations 
budget for FY 1989. During the next 
fiscal year, two successive administra- 
tions will shoulder the burden of Amer- 
ica's global responsibilities. Both will 
face the challenge of fulfilling our na- 
tional objectives in a complex and 
changing world. To meet this challenge, 
both administrations will need not only 
the full amount of requested funds but 
also the latitude to apply them 
effectively. 



The message I want to leave wit 
the committee today is this: we must 
not allow the American eagle to beco 
so undernourished or so encumbered 
her flight that she loses her gi-ip on 
either the arrows or the olive branch 
Neither this Administration nor the 
next one can afford to let that happei 
Far too much is riding on her wings. 



'Press release 40 of Mar. 11, 1988. Tl 
complete transcript of the hearings will 
published by the committee and will be 
available from the Superintendent of Do' 
ments, U.S. Government Printing Office 
Washington, D.C. 20402. ■ 



idii 



The INF Treaty: Advancing 
U.S. Security Interests 



Secretary Shultz's statement before 
the Senate Foreign Relations Commit- 
tee on March U. 1988 J 

It has been 7 weeks since I testified 
before this committee on behalf of the 
INF [Intermediate-Range Nuclear 
Forces] Treaty. Since then, the treaty 
has received careful and thorough ex- 
amination by this committee, by the 
Armed Services Committee, and by the 
Select Committee on Intelligence. I 
have followed the hearings carefully. I 
believe the three committees have ex- 
amined all the tough questions in a 
searching and responsible manner. 

We have sought to give you as com- 
plete a picture as possible of this 
treaty. Senators have submitted more 
than 1,000 written questions to the Ad- 
ministration and to our witnesses. Our 
written answers, together with our tes- 
timony, have offered extensive informa- 
tion. In addition, we have taken the 
exceptional step of providing to the 
Senate our records of the INF 
negotiations. 

I testified to you at some length in 
my last appearance. I think the case I 
made then for the treaty stands up 
well. That is because the treaty stands 
up well. I believe that, as it considers 
all the relevant evidence, this commit- 
tee should recommend consent to 
ratification of this treaty, without 
amendments or conditions. 



INF: How NATO 
Met the Challenge 

There is one fundamental question yo 
are called on to answer as you considi 
this or any other arms control treaty: 
it in the security interests of the 
United States? 

In the nuclear age, the only true 
basis for security is collective securitj 
This means a strong defense and stror 
alliances. For almost 40 years, with 
consistent bipartisan support, our con' 
mitment to the NATO alliance has bee 
a basic element of our national securit, 
policy. By strengthening NATO, the 
INF Treaty strengthens the United 
States. 

From the outset, the INF process 
has been, first and foremost, about thf 
security of NATO. It has been based 
on the fundamental principle that a 
threat to any part of the alliance is a 
threat to all of it. I reviewed in my 
earlier testimony how, in 1979, the al 
liance adopted a dual-track strategy to 
meet such a threat and how it carried 
that strategy out with steadfastness 
and determination. 

In its 1979 decision, NATO clearly 
established its objective: to meet the 
challenge of the gi-owing disparity be- 
tween NATO and Warsaw Pact ca- 
pabilities in INF missiles. In 1981, 
President Reagan proposed the zero 
outcome. The allies agreed then — and 
repeated throughout the 6 years of ne- 
gotiations — that the zero outcome was 
the best possible way to achieve the 
objectives NATO had established. 



18 



THE SECRETARY 



ATO knew we would get nowhere in 
e negotiations unless we showed that 
i would take the necessary measures 
preserve our own security. U.S. INF 
ployments were absolutely essential 
our success in Geneva. 

At the same time, we kept the 
urage of our convictions at the bar- 
ining table and persisted until our 
iijectives were achieved. We agreed on 
je essential elements of a good agree- 
ent. By now, you are familiar with 
em: 

• Equality of rights and limits; 

• U.S. and Soviet systems only; 

• Global limits, with no transfer of 
e threat from Europe to Asia, or vice 
Tsa; 

• No adverse effect on NATO's con- 
mtional defenses; and 

• Effective verification. 

I described in detail during my last 
)pearance how, over a period of 6 
•ars, we moved from a situation in 
hich the Soviets rejected all of these 
■curity criteria to one in which they 
gned a treaty that embodies each and 
'ery one. 

ATO: Building 
n Its INF Success 

one can have any doubt about how 
jr allies feel about this treaty. When 
ATO's leaders met in Brussels, less 
lan 2 weeks ago, they spent their time 
■oking forward, not back. For those 
iterested in the future of NATO, I 
jmmend to your attention the summit 
eclaration and the separate statement 
n the way ahead in the next big chal- 
;nge for the alliance — conventional 
rms control. I want to quote to you 
xactly what our allies had to say at 
le summit about the treaty you now 
ave before you for consideration. 

The recently concluded INF agree- 
lent between the U.S. and the Soviet 
nion is a milestone in our efforts to 
:hieve a more secure peace and lower 
ivels of arms. It is the impressive result 
'the political courage, the realism and 
le unity of the members of the Alliance, 
he treaty's provisions on stringent ver- 
ication and asymmetrical reductions 
rovide useful precedents for future 
jreements. We look forward to its early 
ntry into force. 

Secretary [of Defense] Carlucci, 
.dmiral Crowe [Chairman of the Joint 
Ihiefs of Staff] and the other Chiefs, 



and General Galvin [Supreme Allied 
Commander Europe] have all described 
the security benefits of this treaty. Let 
me simply add that NATO defense min- 
isters have also fully endorsed the 
treaty. 

Benefits of the INF Process 

Many of you have heard this message of 
allied support first hand, both from al- 
lied leaders who have come here and 
from those with whom you have met on 
your own travels. In particular, I would 
note the trip last month by the Major- 
ity Leader [Senator Robert Byrd] and a 
bipartisan delegation — which included 
you, Mr.. Chairman [Claiborne Pell], as 
you noted — and the important report 
which it produced. Our friends and al- 
lies in the Far East, whose security 
will also be directly enhanced by this 
treaty, all fully support it as well. 

The treaty is by no means a U.S. 
achievement alone: I give full credit to 
our allies, especially the five INF bas- 
ing countries. NATO consultations on 
INF were unprecedented and directly 
enhanced allied solidarity. Nor is the 
treaty an achievement of this Admin- 
istration alone: NATO made the INF 
dual-track decision over a year before 
President Reagan took office. And this 
treaty is not an achievement of the ex- 
ecutive branch alone: Congress has 
fully supported our efforts, on the de- 
ployment track and in the negotia- 
tions — including through the Senate 
Observers Group — and, I might say, in- 
cluding a vote in 1981 fully supporting — 
and unanimous in the Senate — fully 
supporting the objectives the President 
sought. 

Specific Concerns 

As I followed the discussion in this and 
the other committees and reviewed the 
written questions that you and your 
colleagues posed, I singled out a few 
specific points which I thought I should 
address directly. 

Does this treaty stand on its own 
merits? 

This treaty does just what NATO 
set out to do in 1979. It eliminates the 
disparity in INF missiles that led to 
the dual-track decision. As we devised 
our negotiating position, in consultation 
with our allies, we ensured that it could 
always stand on its own merits. 



For years, we rejected Soviet 
efforts to hold this treaty hostage to 
other areas of arms control. We did so 
because this treaty, in and of itself, en- 
hances our security. At the same time, 
the benefits of this treaty will clearly 
be enhanced if and when we conclude a 
START [strategic arms reduction talks] 
treaty, achieve a truly verifiable global 
ban on chemical weapons, and establish 
a conventional balance in Europe at 
lower levels. These are our priorities in 
arms control, and we are pressing ahead 
to achieve them. A single treaty can 
solve some of our problems, but no sin- 
gle treaty can solve all of our problems. 
So we should move ahead when we can 
and when we have an agreement that is 
clearly in our interest and that of our 
allies. To wait for everything to be done 
at once is the surest means of accom- 
plishing nothing. 

Does anything in this treaty keep 
us or our allies from taking the steps 
necessary to maintain an effective 
deterrent? 

The NATO summit declaration 
makes exphcit that the alliance is 
"determined to sustain the requisite 
efforts to ensure the continued 
viability, credibility, and effectiveness 
of our conventional and nuclear forces, 
including the nuclear forces in Europe." 
The allies agreed that "an appropriate 
mix of adequate and effective nuclear 
and conventional forces... will continue 
to be kept up to date where necessary." 

Those of you who have looked into 
the question have seen how completely 
we succeeded in protecting such future 
options. We excluded from this treaty 
any language that the Soviets could 
twist to argue otherwise. Article XIV 
of this treaty means exactly what it 
says, no more and no less. It does not 
affect existing patterns of cooperation 
or future cooperation in modernization. 
When Foreign Minister Shevardnadze 
was asked by the Supreme Soviet last 
month if the treaty would block NATO 
force modernization, he replied that it 
gives no such guarantee. 

In particular, have we somehow 
made a mistake by banning a conven- 
tional ground-launched cruise 
missile? 

The United States and NATO did 
not and do not have any specific plans 
or military requirements to deploy con- 
ventionally armed ground-launched 
cruise missiles with the range covered 
by this treaty. There was no point in 



19 



THE SECRETARY 



inviting the Soviets to add to the 
conventional and chemical threat by 
deploying their recently tested 
intermediate-range cruise missile. 

Moreover, the United States has 
been unable to develop — and the Soviet 
Union has not put forth — a regime to 
effectively verify the differences be- 
tween nuclear and conventionally 
armed ground-launched cruise missiles. 
Thus, we would have to assume that 
any Soviet ground-launched cruise mis- 
sile was capable of carrying nuclear 
weapons. 

This situation is different from the 
one in START, where the United States 
must and will protect its substantial 
force of nuclear and conventional sea- 
launched cruise missiles, as well as 
prospects for a conventional air- 
launched cruise missile. 

Do we need a more intrusive ver- 
ification regime? 

There is no such thing as absolute, 
100% verification. The INF verification 
regime is the most stringent and intru- 
sive in history. You have heard consid- 
erable detail about it, which I will not 
repeat. It is our judgment that the 
treaty, through its successive layers of 
procedures, contains the measures 
needed for effective verification of 
compliance. 

The zero outcome really pays divi- 
dends for verification. Once the elim- 
ination period is over, the existence of 
any intermediate or shorter range mis- 
sile would be a violation. Flight testing 
is not permitted. Such testing can be 
detected by national technical means. 
Without testing, weapons systems lose 
their reliability over time and become 
obsolete. 

Aren't there uncertainties over 
the basic data? 

We designed this treaty so that we 
would not have to take Soviet data on 
trust. But we also ensured that we 
would have more basic data for the INF 
Treaty than for any other arms control 
treaty in history. We have all the initial 
Soviet data and will get a complete up- 
date 30 days after the treaty enters 
into force. This gives us an excellent 
basis on which to assess the data we 
have developed ourselves, as well as the 
means we have used to develop it. 



I know you have heard about some 
differences within the U.S. intelligence 
community over the estimated numbers 
of Soviet systems. I would be surprised 
if there were not differences of opinion; 
they reflect independent analysis which 
helps keep us all alert. The Soviet num- 
bers for deployed and nondeployed 
forces are near the estimates of our in- 
telligence community, allowing for the 
range of our uncertainties. 

There are some differences in 
agency views on the number of non- 
deployed SS-20s. Estimates for non- 
deployed systems are, of course, 
inherently less certain. They vary by 
agency, reflecting the independent anal- 
ysis I have mentioned. 

The treaty is designed to deal with 
possibilities such as the Soviets having 
more nondeployed SS-20s than we think 
they do. Our national technical means 
can verify Soviet compliance with the 
treaty's ban on INF flight testing, as I 
have already noted, as well as with the 
treaty's ban on INF infrastructure. 
Both testing and infrastructure are es- 
sential to a militarily effective force. 
Thus, even if the Soviets did have some 
concealed SS-20s, their effectiveness 
would steadily atrophy. And covert 
systems are of no use for political 
intimidation. 

What will we do if the Soviets 
don't comply with this treaty? 

The Soviet record of compliance 
with treaties is far from perfect. We 
have incorporated into the INF Treaty 
some lessons we learned the hard way. 
For one thing, its terms are more de- 
tailed and precise than those of any of 
its predecessors. Its verification provi- 
sions, by increasing the likelihood of 
getting caught, clearly decrease the at- 
tractiveness of cheating. And the struc- 
ture of the reductions will give us a 
basis to assess Soviet compliance 
early on. 

Thus, the Soviet Union will have to 
destroy all its shorter range missiles 
within 18 months. This "front-end load- 
ing" means that we will be able to see, 
from the outset, whether or not they 
are complying with treaty obligations of 
real military significance. We will be 
destroying our shorter range systems 
in the same timeframe, but for us this 
will involve missiles in storage, not de- 
ployed systems. 



The reductions in intermediate- jCf' 
range missiles will be asymmetrical. 
We will keep a substantial force of Pe 
shing lis until well into the final 
months of reductions. This should pre 
vide an additional incentive for the 
Soviet Union to comply with the 
timetable it agreed to. 

But no treaty in and of itself can 
fully guarantee compliance with its 
terms. We must and will react vig- 
orously to any questionable Soviet ac 
tivities. If we detect an action that 
seems to be a violation, we will press 
the Soviets on it. Besides regular dipltl'^' 
matic channels in Washington and '™ 
Moscow, we will have a new compliaiw " 
forum. Article XIII of the treaty estai *''' 
lishes the Special Verification Commis !"" 
sion, or SVC. •" 

At the SVC, we will describe oun '' 
concerns and press for a response. TH '" 
Soviets may be able to demonstrate ' 
that the action in question was not a *" 
violation. If they do not, this Admin- "* 
istration has shown its determination '' 
take the actions necessary to safegua 
our security. Faced with continuing S 
viet refusal to live by the rules of 



Sfci 



H 



SALT II, the President took an apprc \\ 
priate and proportional response. I 

The role of the Congress in this P 
will remain essential. As I said to yoi 
weeks ago, "If the Soviets cheat on tl 
treaty, the President must be able to 
count on Congress to help him take tl 
measures necessary to preserve our s 
curity and that of our allies." 



Conclusion 

The last question is the fundamental 
one, which I posed at the outset: is th 
treaty in the security interests of the |ij 
United States? I submit to you that tF 
answer is yes. The more closely you 
have studied this treaty, the more I 
am sure you will have joined me in coi 
eluding that it deserves your full | 

support. 



'Press release 43 of Mar. 15, 1988. Tht I 
complete transcript of the hearings will b( , 
published by the committee and will be 
available from the Superintendent of Docii 
ments, U.S. Government Printing Offict", 
Washington, D.C. 20402. ■ 



20 



nonartmont rsl Qtot^ D,,llartb 



THE SECRETARY 



^cretary's Interview 
n "Meet the Press" 



Secretary Shultz was interviewed 
NBC-TV's "Meet the Press" by An- 
■a Mitchell and John Cochran, NBC 
ws, and R.W. Apple of The New 
-k Times on March 20, 1988 ^ 

In Panama, talks have broken off 
ween U.S. officials and Manuel 
riega, but there are reports that 
! Catholic Church is also involved 
efforts to get Noriega to leave. 

The Sandinistas seemed to be 
thdrawing from Honduras but lay- 
r mines as they leave, prompting 
w air attacks by Honduras. And 
at will be the role of U.S. forces 
>t to Honduras? 

First, Panama. Noriega has ap- 
rently rebuffed our initial over- 
•es. What is the situation? What is 
; chance of getting him out? 

A. The situation is that Noriega 
ist leave sooner or later — the sooner 
i better. There is completely eroding 
oport for him. The civilians want him 
leave. Increasingly, the mihtary is 
icking open and making it clear that 
3y want him to leave. 

The most recent development is 
at his two personal pilots — one to pi- 
. his fixed-wing aircraft and the other 
lelicopter — have come to the United 
ates; and that's evidence of a cracking 
■en very close to him. So he must 
dve. I think the weight of opinion is 
at way, and he's going to have to do 

Q. What are the possible terms? 
e apparently are willing to waive ex- 
adition but not drop the indict- 
ents. He wants the indictments to 
; dropped, and he wants some say in 
transition. What is the state of play 
lere? 

A. He can't expect any indictments 
I be quashed — that's out of the ques- 
on— and he can't expect to have any 
iy in the transition. He tried to pro- 
ide an illegal transition through a vir- 
lal coup by this unconstitutional and 
hony process in which he tried to dis- 
lace the legitimate President of Pan- 
ma. So what he has to do is leave, and 
e should settle quickly before the op- 
ortunity that's there before him to go 
D Spain should disappear. 



Q. Now we want to get back to 
that in a moment, but first also es- 
tablish what is the latest situation on 
the ground. We've had the Honduran 
air attacks Saturday against the with- 
drawing — we believe withdrawing — 
Sandinista troops. Are the Sandi- 
nistas out of there, and what side of 
the border was hit by the Hondurans? 

A. I think you described it fairly in 
your opening statement. The Nic- 
araguan Government did invade Hon- 
duras. They had troops in there. That's 
unquestioned. 

It's interesting that President Or- 
tega, at the time they were actively in 
there, said on the radio that they 
weren't. Simultaneously, his Foreign 
Minister was calling the Speaker of the 
House of Representatives here, who 
told me that the Foreign Minister as- 
sured the Speaker that the troops were 
leaving. As it turned out, both of them 
were lying, although their troops now 
are leaving — no doubt in response to 
the strong international reaction to 
what happened and in response to the 
Honduran Government, their actions, 
and the support given to them by the 
United States. 

Q. And will that support extend 
to transporting Honduran farces close 
to the combat zone or to the combat 
zone if requested? 

A. We don't go into the combat 
zone. On the other hand, if we have any 
kind of request from the Government of 
Honduras, we try to honor it; and 
sometimes it's easier than other times 
because our government is tied up in all 
sorts of restrictions, and we try to do it 
properly and legally. So you have to 
struggle your way through this maze, 
but we manage it. 

Q. But do you think we would 
help them move forces to or close to 
the front if they need that? 

A. I'm not going to make a com- 
ment on any particular thing; but any 
request they make, we've tried to 
honor it. 

Q. Back to Panama for a mo- 
ment. You sounded as if you were say- 
ing that the U.S. Government was 
prepared to withdraw its offer to Mr. 
Noriega if he didn't accept it in the 
next couple of days. Is that a correct 
inference? 

A. You can make any inference 
you want. I do think that right now he 
has the opportunity to make a semi- 



graceful exit. The sooner he makes it, 
the better for Panama, the better for 
the Panamanian Defense Forces. He 
would have an airplane that would take 
him there, and the Spaniards are ready 
to receive him. 

Q. And, if not, are we prepared to 
throw him out? 

A. I'm not going to get into such 
iffy questions. The point is not what 
the United States is doing; it's the peo- 
ple of Panama who are taking charge of 
him. 

Q. Let's suppose for just a mo- 
ment that he doesn't leave and that 
the people of Panama do take things 
into their own hands. American mili- 
tary commanders in that area are be- 
coming quite worried about the well- 
being of Americans in the area. I've 
been out on the campaign trail. The 
presidential candidates are becoming 
quite agitated about the Panama Ca- 
nal, some of them saying we should 
abrogate our agreement to turn it 
over to the Panamanians. Aren't we 
in danger of chaos down there? 

A. No. What is happening is that 
Noriega increasingly is seen as a drug 
runner, as a person who has very close 
Cuban-Libyan ties. It shouldn't be lost 
on anybody that the first foreign gov- 
ernment president to come to his side 
was President Ortega of Nicaragua. So 
you see the kind of company he's keep- 
ing. And the Panamanians see that. 
They want to get him out, and they are 
expressing that in all sorts of ways. I 
think that they're going to succeed, and 
we'll help them. 

Q. Is there anything there to suc- 
ceed him? 

A. Yes. In the first place, there is 
a proper, recognized President, civilian 
President, that will succeed him — or he 
will succeed him. 

Second, the [National] Civic 
Crusade and opposition party members 
have kind of rallied together to support 
him and support a transition. 

And, third, certainly there are 
many credible and worthwhile people in 
the Panamanian Defense Forces. They 
have an honorable, continuing role to 
play in Panama; and leadership cer- 
tainly will be found, without a doubt, in 
that case. So there is plenty of succes- 
sion around. 

Q. Going back to Honduras and 
Nicaragua, do the events of the past 
week make you more optimistic than 
you were a week ago about getting 
contra aid? And what are your plans 
for requesting contra aid? 



21 



THE SECRETARY 



A. First of all, let me say that the 
President's policies in Central America, 
which were set out very clearly way 
back in 1983 to a joint session of Con- 
gress, have been gradually succeeding, 
and we now see four civilian-elected 
presidents in Central America instead 
of just one. And we saw great progress 
in having an impact on Nicaragua and 
trying to get it to change. 

It was doing fine until in early 
February, a majority — a bare major- 
ity — of the House of Representatives 
voted to stop further American aid to 
the freedom fighters in Nicaragua. It's 
been downhill since that time. That 
vote was a real setback for the inter- 
ests of the United States and for the 
interests of freedom in Central Amer- 
ica. It certainly is not too late to turn 
that around, and the freedom fighters 
deserve support. But that was a severe 
blow to freedom; there's no doubt about 
it. 

Q. So what happens next? Is this 
cross-border incursion — alleged or 
otherwise — going to help your case? 

A. It's not alleged or otherwise; it's 
a fact, and even Andrea Mitchell said so 
in the opening of this show — she said 
so. She reported the news accurately. 
So it has had an impact on people, and 
it has helped to e.xpose the Nicaraguan 
Government and Ortega for what they 
are. They lied about it again. How 
many times are we going to buy a used 
car from that guy? 

Q. You made a comment up on 
the Hill on Thursday to a Senate 
committee. Talking about a conversa- 
tion between the Nicaraguan Foreign 
Minister and House Speaker Jim 
Wright, you said, "There must be a 
direct line between Managua and Jim 
Wright's office." 

I know it was just a joke, but in 
fact I thought there was a peace 
treaty between the two of you. I 
gather you're still upset about Mr. 
Wright being in direct negotiations 
with the Nicaraguan Government. 

A. I thought it was very interest- 
ing, and it helped us to know what the 
Foreign Minister of Nicaragua wanted 
Mr. Wright and all of us, through him, 
to believe. He wanted us to believe 
something that wasn't so. And now as a 
result of the reactions that have taken 
place— very broad-scale reactions; not 
only in this country, but abroad — per- 
haps the Nicaraguans are retreating. 
And, as I think also was pointed out 
here, they are trying to lay mines as 



22 



they do so to make life more difficult 
for people to re-use the airport that 
they took and other things of that kind. 

Q. And you don't object to Jim 
Wright talking to the Nicaraguans? 

A. He is the Speaker of the House 
of Representatives, and he can talk to 
anybody he wants to talk to, and does. 

Q. What about contra aid, includ- 
ing a military component? Several 
senators suggested that just the other 
day. Would the Administration sign 
on to that, or, in fact, has the Admin- 
istration been behind the scenes, sug- 
gesting— 

A. No. Quite a number of sen- 
ators — Democrats and Republicans — 
produced a plan. It's a very interesting 
plan. We're studying it. It seems a lit- 
tle low on money, but it is an interest- 
ing effort on their part and deserves 
careful study, and I hope that some- 
thing goes forward. It should go 
forward. 

Q. Do you think those cease-fire 
talks will be held as scheduled tomor- 
row, or have the recent events made 
that impossible? 

A. I don't know. I think the like- 
lihood is they will, but I'm not certain 
of that. There seems to be a certain 
amount of maneuvering among the par- 
ties. But I think a reasonable and sen- 
sible cease-fire would be a good thing, 
and so we're for it. We're for pushing 
forward on the accord that was signed 
in Guatemala City last summer and re- 
affirmed in San Jose in January. We'd 
like to see that go forward. The prin- 
cipal obstacle is the Nicaraguan 
Government. 

Q. A very basic question: Perhaps 
I need educating, but I've always felt 
that the reason for a show of force 
was to scare the other guy, and I 
don't understand what good it does to 
send a bunch of troops to a hot spot, 
saying "Under no circumstances will 
they engage in combat. They won't 
even get close to combat. We'll tell 
you in advance they're going to be out 
of there in X days." How does that 
show force to anyone? 

A. It shows support for the Gov- 
ernment of Honduras. It does it in a 
way that, among the options, they 
thought was the most worthwhile. It 
shows immediate U.S. responsiveness, 
and it does put forces in there should 
the Nicaraguans invade much more 
fully into Honduras than they have so 
far. And to the extent that — 



rier^ 



Q. So there is no commitmenl 
not to use them under any circum 
stances? There are circumstances u 
der which you could use those foro 

A. Those forces are not there w 
any plan to engage in anything othei,,,^ 
than an exercise, which is just what 
they are doing. 

Q. But if there should be a m^n* 
invasion, as you just said? 

A. Any time a country that's p. 
of the OAS [Organization of Americ. 
States] system, part of the Rio treat 
system, is invaded in a major way, oi 
viously there's going to be a respon ' 
this hemisphere and we're going to 
part of it. 

Q. And those troops could be p| 
of it? 

A. I don't want to in any way de 
ate from the fact that those troops ai 
sent in there to show support for the 
Government of Honduras, which aske i| 
for them, and thereby beef up the ex aiJi 
cise procedure that was going on. lltul 
That's exactly what they're doing, am |«s( 
that's all they're doing. iu 

Q. Didn't they ask for help but L 
not explicitly for troops? I read at 
least the cable that was disclosed. 1 
don't know if there were other secrt 
requests. 

A. The process is something like 
this: The Nicaraguans invaded Hon- 
duras. The Government of Honduras, 
among others, was concerned about i1 
to put it mildly, so they said, "You ha 
said you'd support us under such cir- 
cumstances. Will you do so?" And the' 
President reaffirmed through the am- 
bassador, "Of course." 

In the meantime we had discus- 
sions here, if asked, what are differen 
things that could be done? And so, in 
back-and-forth discussion between oui 
ambassador, speaking for us, and the 
President of Honduras, the different 
options were looked at; and the Presi- 
dent of Honduras said, "Do this. That 
would help me." So we did it. 

Q. The events in Central Americ 
have pushed the Middle East now ofl 
the front page, but I think you're sti 
very much involved in it. You make 
much of the fact that Prime Ministei 
Shamir didn't actually say no to you 
peace plan, but he said no to the in- 
ternational conference. He said no t( 
territory for peace. You've also said 
that none of the components of your 
plan can be changed. So in effect, 
even though the Israeli Cabinet 
hasn't voted, hasn't he said no, 
really? 



.!_.;. l3l 



AFRICA 



A. The situation is that we have an 
jroach to getting the peace process 
ng in the Middle East. So far as I 
!, nobody else has one. At the same 
18, the need to move is clear, and 
irybody acknowledges it — including 
I me Minister Shamir, including For- 
;n Minister Peres, including the Arab 
iders. Everybody says it's time. As it 
IS put to me in Israel, I think by 
me Minister Shamir, the page has 
jn turned; we have to write a new 
iipter. 

So how are we going to write that 
iipter? It must be through negotia- 
ns. How do we get into those direct 
ateral talks that have to be the es- 
ice of a settlement? We have pro- 
ved a way to do it, and we're talking 
)ut it with all of the parties. Every- 
iy's evaluating; nobody says no; no- 
iy says yes; and it's in the nature of 
s process. 

Q. Henry Kissinger for one has 
d that he has the gravest doubts 
out an international conference be- 
ase the United States would just 
d up being beaten up by everyone 
'olved and blamed for everything, 
lat do you say about his analysis? 

A. Prime Minister Shamir, to a 
"tain extent, and others who have 
itten against our concept, singling 
t the international conference we've 
Dposed, have been opposing an inter- 
tional conference that we did not pro- 
se. In fact, they have been opposing 
3 kind of international conference 
at was proposed by the Soviets in the 
M Security Council and which we 
toed. 

We proposed a conference that is 
t able to impose solutions on the par- 
!S, not able to veto any agreements 
at are made by the parties, but is a 
hide for getting negotiations started, 
lat's what we proposed, and that's be- 
nning to become clearer as a result of 
tacks that people are making on a 
fferent kind of conference, which we 
•pose too. 

Q. As John pointed out, isn't it 
sad? 

A. I don't think so. We'll see. For 
■e sake of the region, as President 
jagan said, "You don't have to answer 
me. You have to answer to your own 
fople in your own region." 

Q. Everybody agrees that what 
•u're doing is important — I mean, 
ying to effect peace in the Middle 
ast, that's God's work — but at some 



South Africa's Proposal 
to Ban Foreign Funds 



DEPARTMENT STATEMENT, 
MAR. 2, 19881 

On the proposed South African prohi- 
bition of foreign funds which would ban 
organizations from receiving funds from 
abroad for political purposes, we regard 
this proposed legislation as unwar- 
ranted. Coming on the heels of last 
week's effective outlawing of most anti- 
apartheid organizations, this is further 
evidence that the South African Gov- 
ernment, not content with being iso- 
lated by others from the rest of the 
world, is determined to isolate itself 
from Western democracies and the 
world at large. 



Americans, like others throughout 
the civilized world, are providing help 
to groups seeking peaceful change in 
South Africa. The South African Gov- 
ernment's action may well discourage 
such efforts. For our part, we intend to 
continue our support for constructive 
change and expanded black opportu- 
nity, and we urge those concerned with 
a democratic alternative to apartheid to 
do likewise. 



'Read to news correspondents by De- 
partment deputy spokesman Phyllis 
Oakley. ■ 



point you have to say you're beating 
your head up against a stone wall 
here. You're inviting a certain 
amount of, if not humiliation, at 
least — can a superpower keep going to 
people and pleading with them? At 
some point don't you have to just say 
"enough?" 

A. We're not going to people plead- 
ing with them. We're going to people 
trying to help them. And I don't think 
you should ever get tired of working for 
peace. 

Q. Are you ready to go back to 
the Middle East? 
A. Sure. 

Q. What are the chances of your 
going back? 

A. I don't know. I'm ready. If 
there's something constructive to be 
done, I've always been ready. 

Q. What's the signal you need to 
go back? What's the minimum you 
need to go back? 

A. We'll just evaluate the situation 
as it goes and see in what way we can 
do the most good. 

Q. Mr. Shevardnadze [Soviet For- 
eign Minister] is due in Washington. 
We're clearly going to have or appar- 
ently going to have a summit meeting 
in Moscow this spring. I can re- 
member you saying to me and to oth- 
ers on a number of occasions, "It's 
very important not to have summit 
meetings until you have something 



ready." We're going to have the sum- 
mit, and we apparently don't have 
anything ready — at least not an 
agreement. Is this a mistake? 

A. No. I think it is important that 
summit meetings have content, but it's 
also true that we are now evolving into 
a process where perhaps they will come 
to be a little more normal — not that 
they'll ever be like meetings between 
any other two countries — and I think 
that's healthy. But there are plenty of 
things on our plate right now that can 
come to fruition other than the strate- 
gic arms treaty. 

But both sides would like to see a 
strategric arms treaty if we can get a 
good one that's solid and we see in our 
interests and, of course, they have to 
see it in theirs. 

Q. But that's not possible — we'll 
not have any strategic arms treaty at 
this spring's meeting — is it? 

A. Oh, I think it's possible. 

Q. You still think it's possible? 

A. I think it's very hard work, and 
it's by no means in the bag, but it's 
possible. But we're not going to try to 
have one just for the sake of a treaty. 
We'll only be willing to go forward — the 
President will — if it's something we re- 
gard as good. 

Q. Can you tell us how you feel 
about the Israeli crackdown on the 
press, on TV crews? 



av 1988 



23 



ARMS CONTROL 



« 



Q. They've been blocked from the 
occupied territories today. 

A. I think that it's by and large a 
good rule to be open to the press and 
let people see what's going on. In dem- 
ocratic societies, people want to see 
what's going on and get an accurate pic- 
ture. 

Q. So you disapprove. 

A. The Israelis have a problem. 
They have the problem of maintaining 
order. It isn't so much trying to pre- 
vent people from knowing what's going 
on; in a sense it's incitement that the 
television camera may give. A person 



sees a camera, runs out, and throws a 
rock, so that a person can get beat on — 
that kind of thing — and the Israelis are 
worried about that. 

Q. It sounds a little bit like the 
excuses made in the American south 
a generation ago. 

A. No, no. I'm not giving excuses. 
I'm explaining the situation they're in. 
But, as I said to begin with, I think 
basically the right policy is an open 
policy. 



'Press release 47 of Mar. 22, 1988. 



SDI: Enhancing Security 
and Stability 



by Edward L. Rowny 

Address before the Institute for 
Foreign Policy Analysis Conference on 
the Strategic Defense Initiative on 
March U, 1988. Ambassador Rowny is 
special adviser to the President and the 
Secretary of State for arms control 
matters. 

My introduction to what has become 
the Strategic Defense Initiative (SDI) 
dates to my conversations with then- 
Governor Reagan during the 1980 cam- 
paign. The "Governor" had a rhetorical 
question. Why, he asked, should we and 
the Soviet Union be content to sit like 
two people with pistols pointed at one 
another's heads? How could we change 
this inherently dangerous situation? I 
answered that there were two basic ap- 
proaches to bring about a change. We 
could agree to put the pistols down — to 
reduce arms — or we could put on 
helmets — defend ourselves. At that 
time, however, technology was not suf- 
ficiently advanced to support the 
"helmet option." 

This conference is evidence that 
the situation has changed. In the 5 
years since President Reagan's speech 
launching SDI, we have seen great 
progress in the technology of strategic 
defenses. Indeed, the Defense Acquisi- 
tion Board has approved six key SDI 
technologies for demonstration and 
validation. 

But I will leave the technology to 
the scientists. My remarks will focus on 
SDI in its strategic context — how it fits 
in with our defense and arms control 



goals. I will also address how the So- 
viet Union responds to these goals. 

Pursuing both of the approaches I 
discussed with him in 1980, two of the 
highest priorities on President Reagan's 
agenda are SDI and START [strategic 
arms reduction talks], a treaty which 
would reduce strategic offensive arms. 
The President is deeply committed to 
developing effective defenses against 
ballistic missiles and to working toward 
a strategic arms reduction treaty that 
will cut in half existing U.S. and Soviet 
nuclear arsenals in a manner that con- 
tributes to stability. 

The common theme uniting these 
goals is security and stability. Future 
strategic defenses offer us hope against 
the threat of ballistic missile attack. A 
good START treaty will reduce that 
threat, too. The overarching link be- 
tween these objectives is the goal of 
enhancing deterrence. Both seek to re- 
duce the risk of war. 

However, the popular debate on the 
role of strategic defense and deterrence 
often centers around the notion that 
START and SDI are competing objec- 
tives. But they must not be viewed as 
competitors. In fact, the United States 
pursues the two goals in such a fashion 
as to make them mutually reinforcing: 
fewer strategic offensive weapons sim- 
plifies the task of defending against 
them, while the prospect of effective 
strategic defenses discourages Soviet 
reliance on their preemptive offensive 
nuclear strategy. This, as I will discuss 
later, is not the approach now taken by 
the Soviets. 



Again, the common theme in 
START and SDI is enhanced security 
and stability. A treaty reducing the 
strategic nuclear arsenals of the Unite 
States and Soviet Union can contribute 
to the goal of enhanced security, but 
only if it provides for stabilizing reduc 
tions — that is, reductions in those So- 
viet weapons and delivery systems wit 
the greatest first-strike potential. To 
use an appropriate cliche, any strat- 
egist worth his salt will tell you that it 
is more important to decrease first- 
strike incentives than it is to decrease 
weapons inventories. And given the Si 
viet record on compliance and the high 
national security stakes of a START 
agreement, it is critical that these 
reductions be carried out under a 
verification regime that provides 
confidence for the United States that 
the Soviets are complying with the 
agreement. 

Strategic defenses meeting the 
stringent criteria of the United 
States — military effectiveness, sur- 
vivability, and cost effectiveness — will 
contribute to those very goals of im- 
proved security and strategic stability 
furthered by a good START agreemen 

Inhibiting Soviet 
First-Strike Planning 

What about SDI and deterrence? It is 
important to recognize that deterrence 
can be enhanced even with a partially 
effective strategic defense system. Thii 
is because of the havoc such effective 
strategic defenses could wreak on a po- 
tential attacker's first-strike plans. 
Planning a nuclear first strike is a 
highly complicated effort with specific 
military objectives. Soviet military 
strategy has been based on the pre- 
emptive use of nuclear weapons in the 
effort to destroy or neutralize Western 
nuclear assets and to disrupt our com- 
mand and control systems. Their over- 
all objective in a nuclear war would be 
to deny the United States the option of 
effective retaliation, thereby preserving 
the Soviet Government and their elite. 
The weapon best suited to this goal 
is the large, MIRVed [multiple indepen- 
dently-targetable reentry vehicle] 
ICBM [intercontinental ballistic mis- 
sile], which constitutes the backbone of 
Soviet strategic forces. Effective Amer- 
ican strategic defenses would severely 
inhibit the military utility of the Soviet 
planner's favorite weapon and greatly 
contribute to the uncertainty of the So- 
viet attack plan. As Soviet planners 
come to realize the decreasing utility of 



24 



Department of State Bulletirl 



ARMS CONTROL 



ballistic missile in this critical stra- 
c role, they will have no incentive to 
lire greater numbers. Rather, they 
be led to reduce their reliance on 
weapon and alter their doctrine. 
Denying Soviet ballistic missiles a 
ride to their targets can throw a 
ikey wrench into the best-laid plans 
le Soviet General Staff. And it is in 
(interest to see to it that no Soviet 
I ner could contemplate a first strike 
nr any circumstances with any con- 
ince. This is what enhancing strate- 
ideterrence is all about. SDI 
Iributes to this goal. 
Our experience since 1983 has 
tvn that SDI has reinforced and con- 
es to reinforce the American posi- 
at the negotiating table, especially 
TART. SDI played a key role in 
ing the Soviets back to the nego- 
ng table in 1985 and has helped 
D them there since. The record has 
vn that the Soviets take arms con- 
seriously only when it is clear that 
United States is prepared to do 
t is required to preserve the mili- 
• balance. The INF [Intermediate- 
ge Nuclear Forces] Treaty is an ex- 
;nt example of what can be achieved 
rms control when the United States 
its allies are ready to meet their 
irity needs by their own action. 
In the strategic arms field, con- 
ed modernization of U.S. strategic 
nsive forces, coupled with a vig- 
is strategic defense program, gets 
message to the Soviets that their 
■e for strategic superiority will not 
olerated by the United States. SDI 
motes Soviet seriousness at the 
gaining table. Moreover, deployed 
itegic defenses would actually 
■ngthen a START regime. While 
/ would not decrease the importance 
heating, effective defenses could re- 
e its impact by providing a margin 
afety as a hedge against a clan- 
tinely deployed offensive force. 

Cooperative 
nsition to Defenses 

t as clearly, a good START treaty 
ports our goals for SDI. It's as sim- 
as realizing that fewer offensive bal- 
ic missile warheads — a smaller 
Bat — make the defensive job that 
:h easier. This is another reason we 
sue a START treaty — and why we 
>ct the Soviet effort to kill or cripple 
Strategic Defense Initiative as the 
;e of that deal. 



The U.S. approach to strategic sta- 
bility and enhancing deterrence is di- 
rectly reflected in our arms control 
positions at the nuclear and space 
talks. We are working toward a stabiliz- 
ing and verifiable 50% reduction in 
strategic offensive arms, while advanc- 
ing in the defense and space talks a 
treaty that would help provide for pre- 
dictability in the strategic relationship 
and for the possibility of moving coop- 
eratively toward a more stable, in- 
creasingly defense-rehant deterrent 
regime. 

The Soviet Union, however, has not 
adopted a similarly progressive ap- 
proach. The Soviets would like to pre- 
serve their offensive force advantages 
while they pursue their own strategic 
defense programs. So the Soviets still 
maintain their linkage between START 
reductions and crippling restrictions on 
the U.S. SDI program, limits they seek 
to impose on SDI above and beyond 
those already agreed by the sides in 
the ABM [Antiballistic Missile] Treaty. 
They continue to hold offensive reduc- 
tions hostage to U.S. compliance with 
Soviet-defined limits on strategic de- 
fense work. They do this even though 
Soviet strategic weapons are now four 
times the number they were in 1972, 
when the United States concluded the 
ABM Treaty in the belief that it pro- 
vided the premise for reducing the 
then-existing strategic offensive nuclear 
arsenals. 

The Soviets don't impose linkage 
because they object to strategic defense 
in principle. They have their own stra- 
tegic defense program, estimated to 
cost about $20 billion annually, the exis- 
tence of which they categorically denied 
until General Secretary Gorbachev's off- 
hand admission of it to Tom Brokaw. 

The Soviet strategic defense effort, 
in fact, is comprehensive and long- 
standing. It consists of the permitted 
100-interceptor system deployed around 
Moscow, which the Soviets are now up- 
grading; a comprehensive passive de- 
fense program for the protection of the 
Soviet leadership and key industry; 
massive strategic air defenses (over 
12,000 SAM [surface-to-air missile] 
launchers); and programs investigating 
many of the same advanced strategic 
defense technologies under investiga- 
tion in SDI. 

This advanced technology program 
is, moreover, no "response" to SDI. Its 
various elements have been in place 
since the 1960s, and it represents, as a 
whole, a much greater investment of 



plant space, capital, and manpower 
than does SDI. The Soviets are investi- 
gating weapons technologies for kinetic 
energy, particle beam, radio-frequency, 
and laser weapons. 

Soviet investment in their laser 
weapon program is especially interest- 
ing and instructive, since the Soviets so 
often denigrate the prospects for these 
advanced technology weapons. The So- 
viet military laser program involves 
some 10,000 of their top scientists and 
engineers and would cost us $1 billion a 
year to duplicate. It is centered at Sary 
Shagan, where the Soviets also conduct 
other ABM activities. The Sary Shagan 
facility features several air defense 
lasers and two lasers probably capable 
of damaging some components of satel- 
lites in orbit. One of these lasers is 
suitable for ballistic missile defense fea- 
sibihty testing. 

"Semantic Infiltration" 
Opposing SDI 

It stretches one's credulity to reconcile 
the aggressive Soviet strategic defense 
program with Soviet rhetoric on SDI. 
The Soviets have charged that SDI is a 
U.S. attempt to gain strategic superi- 
ority, to generate a new round in "the 
arms race," to "militarize space," and 
to undermine the basis for offensive 
arms reductions. However, in Geneva, 
the Soviets have shown themselves un- 
wilHng to engage in open discussion of 
key issues, such as the nature of strate- 
gic stability, the possible contributions 
of defenses to stability, measures for 
ensuring predictability in the strategic 
relationship, and the offense-defense 
relationship. 

No state is so strong a proponent 
of strategic defense in practice as the 
Soviet Union, yet none is more strongly 
opposed to SDI in public. Standing So- 
viet rhetoric side-by-side with their 
strategic defense efforts, one is led to 
conclude that the Soviets are far more 
interested in stigmatizing the U.S. de- 
fense effort than in engaging in a rea- 
sonable and constructive dialogue on 
the future of the strategic relationship 
and the role of strategic defenses in it. 

The Soviets have recently adopted 
the theme that the issue in the defense 
and space talks is not SDI but the 
ABM Treaty. They have downplayed 
their polemical attacks on SDI in favor 
of arguing for "stability," which they 
say means an unconditional commit- 
ment to the ABM Treaty. But changes 
in Soviet public statements, in my 
judgement, reflect more of a shift in 
the style than in the substance of their 
position. 



Lli 



25 



ARMS CONTROL 



If there is one thing that Gor- 
bachev and his new team in Moscow 
represent, I believe, it is the reahzation 
that one can draw more flies to honey 
than to vinegar. So the Soviets are 
practicing their time-honored technique 
of semantic infiltration by employing 
some of our lexicon to serve their politi- 
cal ends; for example, by emphasizing 
the word "stability," by which they 
mean the United States observing the 
ABM Treaty on Soviet terms, although 
the Soviets themselves are violating the 
treaty. They have toned down some of 
the harsher aspects of their rhetoric. 
But their goal remains the same — kill- 
ing SDI, quickly or slowly. In their 
well-orchestrated public campaign of 
antipathy to the U.S. investigation of 
strategic defenses, the Soviets even 
trot out the very same Soviet scientists 
who develop Soviet strategic defense 
technology to allege that "it can't be 
done" and "it's destabilizing." This must 
be recognized as another cynical at- 
tempt to undermine a legitimate effort 
that "threatens" only a Soviet mihtary 
advantage. 

We must look to our own interests. 
The American people overwhelmingly 
support the idea of defense against bal- 
listic missile attack. Yet the U.S. Con- 
gress has been unwilling to provide the 
funds necessary to move the program 
as fast as the technology will permit. 

It is clear now, 5 years from Presi- 
dent Reagan's visionary speech, that 
SDI's future depends not so much on 
the ingenuity of our scientists or the 
limits of technology as it does on our 
willingness to meet the political chal- 
lenges posed by the possibility of effec- 
tive strategic defenses. The road ahead 
is difficult, and we can expect the Sovi- 
ets to remain uncooperative. We must 
demonstrate to them our resolute de- 
termination to move forward to a stra- 
tegic balance incorporating defenses 
which threaten no one. There is no rea- 
son we should be wedded to an uneasy 
balance of nuclear terror. Rather, we 
should recognize that the incorporation 
of effective strategic defenses in the 
balance could serve to decrease both 
the chances and the threat of war. This 
is the real challenge of SDI. ■ 



U.S. Arms Control Initiatives 



Arms reduction negotiations are a key 
element in the Administration's strat- 
egy to build a safer peace and ensure 
the security of the United States and 
its allies. Through arms reductions, we 
seek to enhance strategic stability at 
lower levels of military forces, thus re- 
ducing the risk of conflict. The United 
States took an important step toward 
that goal with the signing in Wash- 
ington on December 8, 1987, of the INF 
Treaty. We continue to seek further re- 
ductions at the nuclear and space talks 
(START and defense and space) in Gen- 
eva as well as at other negotiating for- 
ums where the United States has taken 
the initiative to reduce the risk of war. 

Intermediate-Range Nuclear Forces 

The INF negotiations have successfully 
concluded. On December 8, 1987, Presi- 
dent Reagan and General Secretary 
Gorbachev signed the historic INF 
Treaty, which provides for the elimina- 
tion of the entire class of U.S. and So- 
viet ground-launched INF missile 
systems. The success of these negotia- 
tions is a direct consequence of the 
President's steadfast commitment to 
achieving real arms reductions, rather 
than merely hmiting increases as in 
previous treaties. The treaty is also the 
result of NATO solidarity in responding 
to the threat posed by Soviet deploy- 
ment of SS-20 missiles. 

The treaty provides for the elim- 
ination of all U.S. and Soviet ground- 
launched INF missile systems in the 
range of 500-5,500 kilometers (about 
300-3,400 miles) and the elimination of 
related support facilities and support 
equipment within 3 years after it en- 
ters into force. The treaty bans all pro- 
duction and flight testing of these 
missiles immediately upon entry into 
force. After the 3-year period of elim- 
ination, the treaty will ban all facilities 
for deployment, storage, repair, and 
production of these missile systems. 
The treaty contains the most compre- 
hensive verification provisions in the 
history of arms control, including vari- 
ous types of short-notice, onsite inspec- 
tions as well as inspection by resident, 
onsite teams at a key missile facility in 
each country. 

The INF Treaty is consistent with 
longheld U.S. positions in key areas of 
the negotiations. 



Intermediate-range missiles 
(range 1,000-5,500 km). From the be 
ginning of formal talks with the Sovie 
Union in November 1981, the United 
States sought to eliminate all U.S. an 
Soviet IRM systems — the President's 
original "zero option" proposal. In Jul 
1987, the Soviets finally agreed to elii 
inate these systems. 

Shorter range missiles (range 
500-1,000 km). The United States in- 
sisted from the beginning of the nego 
tiations that an INF agreement must 
constrain shorter range missiles to pr 
vent a Soviet buildup of such systems 
which, if forward deployed, could hit 
many of the same targets as the IRM. 
The agreement to eliminate all U.S. 
and Soviet SRMs as an integral part i 
an INF accord satisfies this U.S. 
requirement. 

Reductions on a global basis. Tl 

United States required that any limit; 
tions on INF missiles must be global i ^ , 
prevent the transfer of the Soviet INI P 
threat from Europe to Asia. The Sovi- ¥' 
ets accepted this in the context of I' 
global elimination of both categories o] 
U.S. and Soviet INF missiles. ' 

No allied forces. The United 
States maintained that bilateral agree- 
ments between the United States and 
the U.S.S.R. cannot constrain allied 
forces or affect existing patterns of co- 
operation with our allies. The INF 
TVeaty is consistent with this principle 

No adverse impact on conven- 
tional forces. The United States in- 
sisted that the INF Treaty must not 
weaken NATO's conventional defense 
posture and successfully resisted Sovie 
efforts to include forward-based, dual- " 
capable aircraft. The treaty will actu- ' 
ally improve NATO's ability to i-einfore 
its conventional forces by eliminating 
Soviet shorter range forces which couk 
be armed with nuclear, conventional, Oi 
chemical warheads and could attack 
NATO ports and airports. 



Strategic Offensive Forces 

The United States places highest pri- 
ority on its efforts to reach an equita- 
ble and effectively verifiable agreement 
with the Soviet Union for deep and sta- 
bilizing reductions in strategic nuclear 
arms. In particular, the United States 
seeks reductions in the most destabiliz- 



26 



Department of State Bulletioal 



ARMS CONTROL 



nuclear arms — fast-flying ballistic 
lies, especially heavy, interconti- 
tal ballistic missiles with multiple 
heads. 

As a concrete step toward this end, 
United States presented a draft 
ty at the strategic arms reduction 
s in Geneva on May 8, 1987. This 
't treaty reflected the basic areas of 
pement on strategic arms reductions 
i;hed by President Reagan and Gen- 
I Secretary Gorbachev at Reykjavik 
iictober 1986 to achieve 50% reduc- 
s in U.S. and Soviet strategic nu- 
r arms. The Soviets presented a 
't treaty on July 31, 1987. While the 
let draft contained some areas of 
ilarity to the U.S. proposal, it of- 
d no movement on the major out- 
iding issues. The U.S. and Soviet 
't treaties provided the elements for 
int draft treaty text, which con- 
es to be the basis of negotiations. 
During their meetings in Wash- 
on in December 1987, President 
gan and General Secretary Gor- 
nev agreed to instruct their nego- 
ors to work toward completion of a 
iRT agreement at the earliest possi- 
date — if possible, in time for sig- 
jre of the treaty during their next 
;ting in Moscow in the first half of 
S. In so doing, the negotiators are 
ding upon the agreements of 50% 
uctions as reflected in the joint 
ft START treaty text, including 
eement on ceilings of no more than 
)0 strategic offensive delivery sys- 
is, 6,000 warheads, and 1,540 war- 
ds on 154 heavy missiles; the agreed 
i of account for heavy bombers and 
ir nuclear armament; and an agree- 
nt that, as a result of the reductions, 
aggregate throw-weight of Soviet 
jrcontinental ballistic missiles and 
imarine-launched ballistic missiles 
1 be reduced to a level approximately 
i> below the existing level, and this 
si will not be exceeded by either 
e for the duration of the treaty. 
During the summit, the two lead- 
made further progress on START, 
luding agreement on a sublimit of 
00 for the total number of ballistic 
isile warheads, a method for count- 
the number of warheads on existing 
les of ballistic missiles, and, building 
the verification provisions of the 
F Treaty, guidelines for effective 
•ification of a START treaty. How- 
T, important differences remain, in- 
ding such issues as whether to ban 
bile intercontinental ballistic mis- 
;s, a warhead sublimit on ICBMs, 



sea-launched cruise missiles, and the 
details of an effective verification sys- 
tem. In addition, the Soviets continue 
to link agreement on strategic arms re- 
ductions with U.S. acceptance of meas- 
ures which would cripple the U.S. 
Strategic Defense Initiative. 

The United States seeks a fair and 
durable agreement to bring about — for 
the first time in history — deep reduc- 
tions in the strategic nuclear arsenals 
of the United States and the U.S.S.R. 
We believe such an agreement could be 
reached this year if the Soviet Union 
shares our constructive approach to the 
Geneva negotiations. 

Defense and Space Issues 

In the defense and space forum, the 
United States seeks to discuss with the 
Soviets the relationship between strate- 
gic offense and defense. We also seek to 
discuss how, if we establish the feasi- 
bility of effective defenses, the United 
States and U.S.S.R. could jointly man- 
age a stable transition to deterrence 
based increasingly on defenses rather 
than on the threat of retaliation by of- 
fensive nuclear weapons. 

During their December 1987 meet- 
ings in Washington, President Reagan 
and General Secretary Gorbachev 
agreed to instruct their Geneva nego- 
tiators to work out an agreement that 
would commit the sides to observe the 
Antiballistic Missile Treaty, as signed 
in 1972, while conducting their re- 
search, development, and testing as re- 
quired, which are permitted by the 



Acronyms 

ABM — Antiballistic Missile Treaty 
GORRTEX— Continuous Reflectometry 

for Radius versus Time Experiment 
CSCE — Conference on Security and 

Cooperation in Europe 
CW — chemical weapons 
IAEA — International Atomic Energy 

Agency 
ICBM — intercontinental ballistic missile 
INF— intermediate-range nuclear forces 
IRM — intermediate-range missiles 
MBFR— mutual and balanced force 

reductions 
PNET— Peaceful Nuclear Explosions 

Treaty 
SDI — Strategic Defense Initiative 
SRM — stiorter range missiles 
START — strategic arms reduction talks 
TTBT— Ttireshold Test Ban Treaty 



ABM Treaty, and not to withdraw from 
the ABM Treaty for a specified period 
of time. They agreed that intensive dis- 
cussions of strategic stability shall be- 
gin not later than 3 years before the 
end of the specified period, after which, 
in the event the sides have not agreed 
otherwise, each side will be free to de- 
cide its own course of action. Such an 
agreement would have the same legal 
status as the START treaty, the Anti- 
baUistic Missile Treaty, and other sim- 
ilar, legally binding agreements and 
would be recorded in a mutually satis- 
factory manner. 

On January 22, 1988, the United 
States put a draft defense and space 
treaty on the table at the Geneva nego- 
tiations. This draft embodies the ele- 
ments of the agreement reached by the 
two leaders in Washington. By present- 
ing a draft treaty, the United States 
seeks to transform the areas of agree- 
ment reached at the Washington sum- 
mit into treaty language and to provide 
a vehicle for identifying and resolving 
areas of disagreement. 

The U.S. draft calls for a new and 
separate treaty and incorporates the 
following elements: 

• Entry into force contingent upon 
entry into force of a START treaty; 

• Agreement not to withdraw from 
the ABM Treaty for a "specified period 
of time" to be determined through 
negotiations; 

• Continued observance of the 
ABM Treaty through that period and 
until either party chooses to deploy; 
and 

• After the "specified period of 
time," either party is free to choose to 
deploy strategic missile defenses that 
are prohibited by the ABM Treaty, 
upon giving the other party 6 months' 
written notice of its intention to do so. 

The United States also proposes 
that confidence-building measures to 
provide predictability for each side re- 
garding the strategic defense programs 
of the other be included as an integral 
part of the defense and space treaty in 
the form of a protocol. U.S. -proposed 
predictability measures include an an- 
nual exchange of data on planned stra- 
tegic defense activities, reciprocal 
briefings on respective strategic de- 
fense efforts, visits to associated re- 
search facilities, and establishment of 
procedures for reciprocal observation of 
strategic defense tests. 

On January 15, 1988, the Soviets 
proposed adding a protocol to the draft 
START treaty which deals entirely with 
defense and space issues. This protocol 



V 19Rfi 



27 



ARMS CONTROL 



contains language that is inconsistent 
with the agreement reached at the 
Washington summit. In addition, the 
Soviet proposal retains unacceptable 
linkage between reductions in strategic 
offensive arms and restrictions on stra- 
tegic defense which go beyond those 
agreed in the ABM Treaty. 

We hope that the Soviets will join 
us in serious discussions to conclude a 
defense and space treaty that achieves 
the important goals which the two lead- 
ers identified at the Washington sum- 
mit. We hope that such a treaty will 
hasten progress toward a safer, more 
stable world — one with reduced levels 
of nuclear arms and an enhanced ability 
to deter war based on the increasing 
contribution of effective strategic de- 
fenses against ballistic missile attack. 

Nuclear Testing 

The United States and the Soviet 
Union have begun step-by-step negotia- 
tions on nuclear testing. In undertaking 
these talks, the two countries agreed as 
a first step to negotiate effective ver- 
ification measures for two existing but 
unratified nuclear testing treaties, the 
Threshold Test Ban Treaty and the 
Peaceful Nuclear Explosions Treaty. 
Once these verification concerns have 
been satisfied and the treaties ratified, 
the United States would immediately 
propose negotiations on ways to imple- 
ment a step-by-step parallel program — 
in association with a program to reduce 
and ultimately eliminate all nuclear 
weapons — of limiting and ultimately 
ending nuclear testing. 

We are making progress toward 
our goal of effective verification of the 
two existing treaties. During the De- 
cember 1987 summit in Washington, the 
United States and the Soviet Union 
agreed to design and conduct joint ver- 
ification experiments intended to facili- 
tate agreement on effective verification 
of these two treaties. These joint ex- 
periments, which will take place at 
each other's nuclear test site, will pro- 
vide opportunities to measure the yield 
of nuclear explosions using techniques 
proposed by each side. Through these 
experiments, we hope to provide the 
Soviet Union with all the information 
they should need to accept U.S. use of 
CORRTEX— the most accurate tech- 
nique we have identified for verification 
of the TTBT and the PNET. 

We and the Soviets also agreed to 
visit each other's nuclear test sites for 
the purpose of famiharizing ourselves 
with the conditions and operations at 



those test sites. These unprecedented 
visits — which build on an idea the 
President first proposed in September 
1984 — took place in January 1988 
in a constructive and cooperative 
atmosphere. 

These familiarization visits con- 
tributed to a better understanding of 
the practical problems associated with 
conducting the joint verification ex- 
periments, and we now have the 
information needed to design the exper- 
iments. The two sides began this work 
when round II of the nuclear testing 
talks opened on February 15 in Geneva. 
It is our hope that the United States 
and the Soviet Union will continue to 
make expeditious progress in these 
talks. 

Nuclear Risk Reduction Centers 

On September 15, 1987, Secretary 
Shultz and Soviet Foreign Minister 
Shevardnadze signed an agreement to 
establish Nuclear Risk Reduction Cen- 
ters in their respective capitals. This 
agreement, which is the direct result of 
a U.S. initiative, is a practical measure 
that will strengthen international se- 
curity by reducing the risk of conflict 
between the United States and the 
Soviet Union that might result from 
accident, misinterpretation, or 
miscalculation. The centers will ex- 
change information and notifications 
required under certain existing and 
possible future arms control and confi- 
dence-building measures agreements. 
For example, the centers will be used 
to transmit notifications required under 
the INF Treaty. The United States is 
currently in the process of establishing 
the U.S. center, which will be located 
in the State Department. 

Nuclear Nonproliferation 

In January 1988, the United States 
and the Soviet Union held the 10th 
round in an ongoing series of consulta- 
tions, which began in December 1982, 
on nuclear nonproliferation. These con- 
sultations have covered a wide range 
of issues, including prospects for 
strengthening the international non- 
proliferation regime, support for the 
Nuclear Non-Proliferation Treaty, and 
the mutual desire of the United States 
and the U.S.S.R. to strengthen the In- 
ternational Atomic Energy Agency. 
These consultations are not negotia- 
tions but, rather, discussions to review 
various issues of common concern, es- 
pecially prevention of the dangerous 
spread of nuclear weapons. The next 



consultations will be held around the 
time of the June IAEA Board of Gov 
nors meeting. 

Chemical Weapons 

In April 1984, the United States pre-i"^' 
sented, at the 40-nation Conference (I 
Disarmament in Geneva, a compreheil,(|,j 
sive draft treaty banning developmei 
production, use, transfer, and stockpi *" 
ing of chemical weapons, to be verifif' •' 
by various means, including short- ^ij 
notice, mandatory onsite challenge in S 
spection. At the November 1985 Gem «■«' 
summit. President Reagan and Genei P 
Secretary Gorbachev agreed to inten ■ 
sify bilateral discussions on all asped P 
of a comprehensive, global chemical P 
weapons ban, including verification, m 
Since then, we have held seven round I 
of bilateral talks on a chemical weapo |,|,f 
treaty. An eighth round is proposed f .y, 
spring 1988. These discussions have jj 
narrowed differences in a few areas, i |(y 
eluding early data exchange and de- 
struction of production facilities. 

Until March 1987, the Soviets, w 
possess by far the world's largest che ■• 
ical weapon stockpile, had not admitt E- 
that they even possess such weapons. 1^ 
In April, they claimed that they had 
stopped producing them, had no chen j^j 
ical weapons positioned outside their :i j 
borders, and were building a facility t f 
destroy existing stocks. They also Ifir 
hosted a visit by Conference on Disar |( 
mament representatives to the Soviet w 
chemical weapon facility at Shikhany i 1 
October In addition, the Soviets final |« 
accepted a longstanding U.S. invita- I 
tion to observe the U.S. chemical |i 
weapon destruction facility in Tooele, ' 
Utah; on November 19-20, 1987, a delt ifi 
gation of Soviet experts visited that fa 
cility. We see these moves as useful 
steps toward building confidence, whic 
will facilitate negotiation of an effec- 
tively verifiable ban on chemical 
weapons. 

Nonetheless, a number of key is- 
sues remain unresolved, including en- 
suring participation of all states that 
could pose a chemical weapons threat; 
strengthening verification in light of 
new technologies, the continuing pro- 
liferation of chemical weapons, and the^ 
expansion of chemical industries capa- 
ble of both military and civilian produc 
tion; maintaining security during the 
chemical weapon destruction phase un- 
der a convention; and defining how to 
protect sensitive nonweapons-related 
information during inspections. 



28 



Departmen^^tat^uNetir 



ARMS CONTROL 



Chronology: January 1, 1986-February 15, 1988 



S.-SOVIET ARMS 
WTROL NEGOTIATIONS 

iiclear and Space Talks 

i)und IV: January 16-March 4, 1986 
|)uncl V: May 8-June 26, 1986 
)uncl VI: September 18-November 13, 
1986 

!)und VII: January 15-March 6, 1987 
(INF continued to March 26) 
)und VIII: April 23-December 7, 1987 
(INF); May 5-November 23, 1987 
(START and defense and space) 
)und IX: Began on January 14, 1988 

inference on Confidence- 
id Security-Building Measures 
id Disarmament in Europe 
lultilateral) 

3und IX: January 28-March 15, 1986 
Dund X: April 15-May 23, 1986 
Dund XI: June lO^uly 18, 1986 
Dund XII: August 19-September 19, 
1986 — agreement concluded 

onference on Security 
id Cooperation in Europe 

irst Round of Followup Conference: 

November 4-December 20, 1986 
econd Round of Followup Conference: 

January 27-April 11, 1987 

bird Round of Followup Conference: 

May 4^uly 31, 1987 
ourth Round of Followup Conference: 

September 22-December 18, 1987 
ifth Round of Followup Conference: 

Began January 22, 1988 

'onference on Disarmament 
Vlultilateral) 

Chemical Weapons Committee Rump 
Session: January 13-31, 1986 

pring Session: February 4-April 25, 
1986 

ummer Session: June 10-August 29, 
1986 

Ihemical Weapons Committee Chair- 
man's Consultations: November 
24-December 17, 1986 

Ihemical Weapons Committee Rump 
Session: January 6-30, 1987 

ipring Session: February 2-April 30, 
1987 



Summer Session: June 8-August 26, 

1987 
Chemical Weapons Committee Rump 

Session: November 30-December 16, 

1987 
Chemical Weapons Committee Rump 

Session: January 11-29, 1988 
Spring Session: Began February 2, 1988 

Mutual and Balanced Force 
Reductions (Multilateral) 

Round 38: January 30-March 20, 1986 
Round 39: May 15-July 8, 1986 
Round 40: September 25-December 4, 

1986 
Round 41: January 29-March 19, 1987 
Round 42: May 14^uly 2, 1987 
Round 43: September 24-December 3, 

1987 
Round 44: January 28-March 17, 1988 

(proposed ending date) 

Nuclear Risk Reduction Centers 

Round I: January 13, 1987 

Round II: May 3^, 1987 — agreement 
concluded, ad referendum; agreement 
signed in Washington on September 
15, 1987 

Nuclear Testing 

Round I: November 9-20, 1987 
Round II: Began on February 15, 1988 



U.S.-SOVIET ARMS CONTROL 
EXPERT-LEVEL MEETINGS 



Nuclear and Space Talks 

August 11-12, 1986, in Moscow 
September 5-6, 1986, in Washington 
December 2-5, 1986, in Geneva at the 
negotiator level 



Mutual and Balanced 
Force Reductions Talks 

August 6-7, 1986, in Moscow 
September 10-11, 1986, in Washington 

Conference on Confidence- 
and Security-Building Measures 
and Disarmament in Europe 

August 14-15, 1986, in Stockholm 



Chemical Weapons Treaty Talks 

January 28-February 3, 1986, in Geneva 

April 15-25, 1986, in Geneva 

July 1-18, 1986, in Geneva 

October 28-November 18, 1986, in New 

York City 
February 16-March 5, 1987, in Geneva 
July 20-August 7, 1987, in Geneva 
November 30-December 17, 1987, in 

Geneva 



Biological and Toxin 
Weapons Convention 

March 31-April 15, 1987, in Geneva 



Chemical Weapons 
Nonproliferation Discussions 

March 5-6, 1986, in Bern 
September 4-5, 1986, in Bern 
October 7-8, 1987, in Bern 

Conventional Stability Mandate 
Consultations (Multilateral) 

February 17-April 6, 1987, in Vienna 
May IWuly 31, 1987, in Vienna 
September 2S-December 14, 1987, in 

Vienna 
January 25, 1988, began in Vienna 

Nuclear Testing 

First Session: July 25-August 1, 1986, 
in Geneva 

Second Session: September 4-18, 1986, 
in Geneva 

Third Session: November 13-25, 1986, 
in Geneva 

Fourth Session: January 22, 1987, re- 
cessed on February 9, resumed on 
March 16, concluded on March 20 in 
Geneva 

Fifth Session: May 18-29, 1987, in 
Geneva 

Sixth Session: July 13-20, 1987, in 
Geneva 



Nuclear Risk Reduction Centers 

May 5-6, 1986, in Geneva 
August 25, 1986, in Geneva 



Nuclear Nonproliferation Talks 

December 15-18, 1986, in Washington 
July 28-30, 1987, in Moscow 
January 11-14, 1988, in Washington 



lav 1988 



29 



ARMS CONTROL 



At the Washington summit, Presi- 
dent Reagan and General Secretary 
Gorbachev reaffirmed the need for in- 
tensified negotiations toward conclusion 
of a truly global and verifiable conven- 
tion encompassing all chemical weap- 
ons-capable states. They also agreed on 
the importance of greater openness and 
confidence-building measures. The 
United States is prepared to work con- 
structively with other members of the 
Conference on Disarmament to resolve 
outstanding issues. 

In addition to treaty discussions, 
we are working with allies and other 
friendly countries as well as with the 
Soviets on preventing the proliferation 
of chemical weapons. Primarily in re- 
sponse to the continuing use of chem- 
ical weapons in the Iran-Iraq war, the 
United States and 18 other Western in- 
dustrialized countries have been con- 
sulting since 1985 to harmonize export 
controls on commodities related to 
chemical weapon production and to de- 
velop other mechanisms to curb the il- 
legal use of such weapons and their 
dangerous spread to other countries. 
Also, in bilateral discussions with the 
Soviets on chemical weapon non- 
proliferation, we have reviewed export 
controls and political steps to limit the 
spread and use of chemical weapons. 

Conference on Confidence- 
and Security-Building Measures 
and Disarmament in Europe 

In September 1986, after almost 3 
years of negotiations, the 35-nation 
Stockholm Conference on Disarmament 
in Europe adopted a set of concrete 
measures designed to increase openness 
and predictability of military activities 
in Europe. These measures, which are 
built around NATO proposals, provide 
for prior notification of certain military 
activities above a threshold of 13,000 
troops or 300 tanks, observation of cer- 
tain military activities above a thresh- 
old of 17,000 troops, and annual 
forecasts of upcoming notifiable mili- 
tary activities. The accord also contains 
provisions for onsite air and ground in- 
spections for verification. Although 
modest in scope, these provisions are 
the first time the Soviet Union has 
agreed to inspection on its own ter- 
ritory for verification of an interna- 
tional security accord. The United 
States is encouraged by the record of 
implementation to date which generally 
reflects both the letter and the spirit of 
the Stockholm document. 



On August 30, 1987, the United 
States — under the terms of the Stock- 
holm document — successfully completed 
the first-ever onsite inspection of a So- 
viet military exercise. In September, 
the United Kingdom inspected an exer- 
cise involving Soviet and East German 
forces in the German Democratic Re- 
public; in October 1987, the Soviets con- 
ducted similar inspections of NATO 
exercises in Turkey and the Federal 
Republic of Germany (F.R.G.) involving 
U.S. forces; in November 1987, the 
German Democratic Republic inspected 
a F.R.G. military activity; and in Feb- 
ruary 1988, the United States inspected 
an exercise in Hungary which involved 
Hungarian, Czechoslovakian, and So- 
viet forces. The United States consid- 
ers the successful conclusion of these 
inspections an important step in the 
process of improving openness and 
building confidence and security in 
Europe. 

Flirther Negotiations on Confidence- 
and Security-Building Measures 

At the Vienna CSCE Followup Confer- 
ence in July 1987, NATO proposed that 
the 35 CSCE participating countries re- 
sume negotiations on confidence- and 
security-building measures in order to 
build on and expand the work begun in 
Stockholm. Warsaw Pact and neutral 
and nonaligned states also support re- 
sumption of these negotiations. How- 
ever, final agreement to resume such 
negotiations can only come as part of a 
balanced outcome to the Vienna CSCE 
Followup Conference, including signifi- 
cant progress in Eastern-bloc human 
rights performance. 

Mutual and Balanced 
Force Reductions 

On December 5, 1985, NATO presented 
at the MBFR negotiations a major ini- 
tiative designed to meet Eastern con- 
cerns. The proposal deferred the West- 
ern demand for data agreement on 
current forces prior to treaty signature. 
The Soviets had claimed that this West- 
ern demand was the primary roadblock 
to agreement. The proposal also called 



for a time-limited, first-phase with- jjilf 
drawal from Central Europe of 5,000 i 
U.S. and 11,500 Soviet troops, followetlH 
by a 3-year, no-increase commitment I 
all parties with forces in this zone. 
During this time, residual force levels i|W 
would be verified through national tecl 
nical means, agreed entry/exit points, 
data exchange, and 30 annual onsite ii 
spections. Thus far, the Soviets have 
not responded constructively to the 
Western initiative. 



NATO High-Level Task Force 
on Conventional Arms Control 

This task force presented a report on 
the direction of NATO's conventional 
arms control policy to the North Atlan: 
tic Council on December 11, 1986. At 
that meeting, NATO ministers issued 
the "Brussels declaration," which state 
NATO's readiness to enter into new ne- 
gotiations with the Warsaw Pact aimed 
at establishing a "verifiable, compre- 
hensive and stable balance of conven- 
tional forces at lower levels" in the 
whole of Europe from the Atlantic to 
the Urals. 



Conventional Stability Talks 

NATO began discussions with the War- 
saw Pact in February 1987 to develop a 
mandate for new negotiations on con- 
ventional stability in Europe. In July, 
representatives of NATO presented a 
draft mandate for negotiations that 
would directly involve the 23 nations of 
NATO and the Warsaw Pact and would 
cover their conventional forces on land 
from the Atlantic to the Urals. These 
negotiations would take place within 
the framework of the CSCE process, 
but would be autonomous regarding 
subject matter, participation, and 
procedures. On December 14, 1987, the 
negotiators reached preliminary 
agreement on certain aspects of the 
mandate. Discussion continues on the 
remaining issues. We hope to conclude 
these mandate discussions in 1988 so we 
can get the new negotiations underway. 
As with the negotiations on confidence- 
and security-building measures, our 
ability to proceed with new conven- 
tional stability negotiations depends on 
the achievement of a balanced outcome 
to the Vienna CSCE Followup Confer- 
ence, including progress in Eastern- 
bloc human rights performance. ■ 



30 



Dfinartmsnt of Rt^^tP RiillPtii^ 



.ST ASIA 



jrrent Reflections 
1 U.S.-Japan Relations 



jaston J. Sigur, Jr. 

Address before the Johns Hopkins 
versity School of Advanced Intema- 
al Studies — Japan Forum on March 
1988. Mr. Sigur is Assistant Secre- 
I for East Asian and Pacific Af- 



n always pleased to be able to come 
ne Johns Hopkins School of Ad- 
!ed International Studies and to 
■e my observations and comments 
■ur policies with so many colleagues 
friends. It is a special pleasure to 
lere tonight since this event coin- 
s with a joint research project on 
.-Japan relations between students 
)hns Hopkins SAIS and the Inter- 
onal University of Japan. The joint 
erence reports of the last few years 
3 well received, and I look forward 
lis year's assessment. 
In many ways, this year is a time 
•ansitions. After a successful Janu- 
visit here with the President, 
ne Minister T^keshita resumed the 
k of his new administration in 
^^0. Here in the United States, our 

presidential election campaign is 
erway. The transition of administra- 
s is a good time to reflect on the 
I or issues in U.S.-Japan relations — 
les, I might quickly add, that tran- 
i id administrations or political 
i;ies. 
The Reagan Administration has de- 
d and continues to devote consider- 

time and attention to relations 
1 Japan. I think the President 
med it up the best when he said of 
relationship, "Great care has been 
?n over four decades by political 
lers on both sides of the Pacific to 
d and create this gem of friendship 
ch is of such immense value." The 
sident went on to say that even the 
est of friends have differences and 
t our challenge is to keep trade and 
imerce flowing equitably between 

peoples. 

It is in this context that we must 
ays bear in mind that the rela- 
iship between the United States and 
an is not a single relationship but a 
) of connections — political, defense, 
imercial, financial, personal. With 



Japan, our relations go beyond the tra- 
ditional bilateral levels to shared re- 
sponsibility for close coordination on 
broader political and security matters 
and for the maintenance and improve- 
ment of the global economic system and 
institutions. I would like to highlight 
the main elements of those relations be- 
tween Japan and the United States. 

The Defense Relationship 

The U.S.-Japan Mutual Security Treaty 
is the foundation upon which our bilat- 
eral relationship rests. The interests of 
both the United States and Japan — and, 
indeed, the interests of the West, of 
which Japan is a part — are well served 
by it. Our security arrangements with 
Japan, including the presence of our 
troops and facilities there, are essential 
for the peace and security not only of 
Japan but of the entire Pacific region, 
including, of course, the United States. 

So, as the term "mutual security" 
implies, we share the benefits, as most 
will agree. There is, however, growing 
controversy over sharing the cost of 
that security. The buzzword around 
Washington these days is "burden- 
sharing." And in this time of budget 
austerity, an important focus of admin- 
istration as well as congressional con- 
cern is — and must be — defense 
burdensharing. Japan, in particular, has 
been criticized for taking a "free ride" 
on defense costs. Is that true? What is 
Japan contributing to our mutual de- 
fense burden? 

Japanese defense spending has 
grown in real terms at a rate of some 
b.2% over the past 10 years, signifi- 
cantly higher than that of our NATO 
allies. Japan's defense budget in 1988, 
estimated at some $30 billion, will 
likely be the fifth largest in the world 
and the second largest of non-nuclear 
powers, following West Germany. That's 
an expensive free ride. 

Moreover, Japan will contribute 
$2.5 billion in 1988 for the support and 
maintenance of U.S. forces in Japan. 
That comes to about $45,000 per U.S. 
serviceman stationed there. It is worth 
noting that in some countries where we 
have mutual security obligations, we 
pay the host government for the base 
arrangements. By contrast, in material 
terms Japan provides the most gener- 
ous host-nation support program for 
U.S. forces we enjoy anywhere. And 



we have just signed an agreement un- 
der which Japan, by 1991, will increase 
its contribution to combined U.S. 
forces-Japan labor costs by some $300 
million a year. 

So is Japan taking its defense bur- 
densharing responsibilities seriously? 
Of course it is. Can Japan do more? 
Yes, we believe Japan should and will. 
We think, for example, Japan can move 
more quickly to acquire the capabilities 
to fulfill defensive missions it has set 
for itself, including protection of its 
sealanes out to 1,000 nautical miles. 

This brings us to an ironic turn of 
events. Japan, in order to acquire the 
defense capabilities we wholeheartedly 
agree with, has decided to buy the 
American guided-missile destroyer 
weapons system known as "Aegis." 
Aegis, by the way — at over a half- 
biUion dollars per system — is certainly 
no free ride. Yet some of the same 
Members of Congress who criticize 
Japan for not spending enough on de- 
fense oppose selling Aegis to Japan, cit- 
ing the sensitive defense technology 
involved or arguing that we can some- 
how force Japan to buy not only the 
Aegis system but also the hull to put it 
in. We have been sharing sensitive de- 
fense technology with Japan for 30 
years to our mutual benefit, and the 
Japanese have an excellent record of 
protecting that technology. And while 
the Aegis sale may not directly benefit 
our shipyards, the sale of each system 
will provide over 5,000 man-years of 
U.S. labor in other areas. This issue is 
illustrative of the misunderstanding 
surrounding our defense relationship 
with Japan. 

The argument over sensitive tech- 
nology relates back to the illegal sale of 
advanced milling machines by the 
Toshiba Machine Company, which gave 
the Soviet Union substantially in- 
creased production capability for quiet 
submarine propellers and caused signif- 
icant harm to our mutual security. The 
Government of Japan, of course, shares 
our outrage over that industry diver- 
sion to the Soviets. Tokyo has taken 
several steps, including revision of its 
export laws, to improve its controls on 
strategic technology and prevent a rep- 
etition of illegal trading activity by Jap- 
anese firms. Japan is also working 
closely with us to strengthen COCOM 
[Coordinating Committee for Multi- 
lateral Security Export Controls], the 
multilateral forum responsible for con- 
trolling strategic technology flows to 
the Soviet bloc. 



ii 1988 



31 



EAST ASIA 



Another area where Japan can and 
should do more is in its contribution to 
the maintenance of U.S. forces in 
Japan. As I said earher, Japan's host- 
nation support program already is the 
most generous we have, and we appre- 
ciate it. But the fact is that the strong 
yen has had a dramatic impact on our 
base expenses. Base worker salaries, 
fuel for our trucks and aircraft, the 
electricity bills at our bases, just to 
mention a few areas, are paid in yen, 
not dollars — and Japan could assume a 
larger share of that burden. 

Development Aid and Foreign 
Policy Cooperation 

But burdensharing is not limited purely 
to defense expenditures, just as our co- 
operation with Japan is not limited only 
to the defense relationship. One of the 
areas in which we cooperate very 
closely is overseas development aid. 
Japan now has the second largest for- 
eign aid program in the world, and if 
current trends continue, Japan will 
overtake the United States in 1991 as 
the world's largest aid donor. 

Increasingly, Japan provides for- 
eign aid to countries of strategic 
importance to the West. Japan has 
substantial development assistance pro- 
grams in countries like the Philippines, 
Pakistan, Egypt, Jordan, Oman, Tur- 
key, and Jamaica, which are of special 
importance to us. Still, we believe 
Japan could do more in this regard. 

Japan also has stepped up its 
efforts to increase financing to develop- 
ing countries. In 1986-87, the Japanese 
Government committed itself to recycle 
$30 billion over 4 years to LDCs [less 
developed countries]. This ambitious 
program, which includes some conces- 
sional bilateral lending and cofinancing 
with multilateral development banks as 
well as nonconcessional loans, should 
provide substantial help to middle- 
income LDCs with heavy debt burdens. 
In addition, the Japanese Government 
has stated the recycling will be com- 
pletely untied, which could benefit U.S. 
exports to LDCs. 

Obviously, defense and foreign aid 
are not the only areas in which we con- 
sult and cooperate closely with Japan. 
In fact, there is hardly any aspect of 
foreign policy on which we do not coor- 
dinate closely, including issues involv- 
ing Asia, Africa, Latin America, the 
Middle East, the United Nations, the 
Soviet Union, and arms control. And I 
can say that, across the board, we have 



found Japan's views to be valuable and 
geared to Western goals; we have seen 
our cooperation become increasingly in- 
timate and fruitful. 

Much of the consultation to which I 
refer has occurred for many years be- 
tween senior officials of the two govern- 
ments. What is noteworthy about the 
last several years is that consultations 
at all political and economic levels have 
become more numerous, more detailed, 
and more useful. Frequent summit 
meetings between the President and 
the Japanese Prime Minister, semian- 
nual subcabinet economic sessions, and 
numerous other exchange visits are 
just a few examples. Obviously, a good 
part of the conversations between gov- 
ernment officials of our two countries 
concerns bilateral relations, and partic- 
ularly economic relations. But the 
leaders have taken up a variety of 
international topics as well, and the dis- 
cussions have taken on the character of 
routine coordination and cooperation. 
We believe this pattern will continue. 

The Economic Relationship 

It is precisely because our defense rela- 
tionship with Japan is crucial, and be- 
cause our cooperation with Japan on 
international matters is so important 
and cordial, that the economic friction 
between the two countries is so vexing. 
The resolution of the trade problems 
between our two countries is necessary 
and central to the maintenance of a 
sound overall relationship. 

Let me summarize my analysis of 
the challenge we face in our economic 
relations with Japan. With determina- 
tion and with goals shared by business, 
government, and citizens, Japan has 
built an economic structure capable of 
developing and producing attractive, 
high-quality products at very com- 
petitive prices. In the past, Japan often 
resorted to "infant industry" protec- 
tion. That sort of protection, question- 
able in any event, is no longer 
defensible. The large Japanese manu- 
facturers have the engineers, the ex- 
panding research and development, and 
ample finance to compete vigorously 
and successfully at home and abroad in 
the absence of government protection. 
There is no more visible evidence of 
this than the volume of Japan's exports 
to the United States and to the world. 
Inefficient industries in Japan, which 
certainly exist, should restructure or 
retrench in an environment of open 
markets. I believe Japan already is on 
that path and should be encouraged to 
adhere to it. 



U.S. Trade Policy Toward Japan , 

One sometimes hears the allegation ir 
Washington that the Administration h 
no trade policy. That simply is not so. ' 
With regard to Japan, we have a polic 
which addresses both individual trade 
problems and the structural issues th; ' 
lie behind our deficit, and it is workir ' 

Before I go into the specifics of 
just what we are doing, I think we ha 
to put the trade imbalance into per- - 
spective so that we know just what th i ' 
problems before us are and so we can "■ 
avoid doing damage to our own self- 
interests through shortsighted ' 
solutions. 

The U.S. economy and the econo 
mies of our large trading partners arc 
very much interdependent. We do not 
and cannot, exist in isolation. Our ecc 
omy is particularly closely intertwinei 
with that of Japan. Our two-way tradt 
with Japan in 1987 of $116 billion was 
our second-largest trading relationshi 
The United States and Japan togethei ,, . 
account for some 60% of total OECD ^^ 
[Organization for Economic Cooperati jj^^ 
and Development] production. „. 

Not just trade but investment 
flows tie our two economies. The dire 
investment position in each other's 
economies stands at $38 billion and is 
expanding rapidly. Japanese direct in- 1, 
vestment in the United States has 
meant employment for U.S. workers. 
There are Japanese-owned manufactui 
ing facilities in 40 U.S. states, employ 
ing well over 100,000 Americans. Thes 
investments have increased U.S. pro- 
ductivity, making U.S. products more fj 
competitive at home and abroad. We 
continue to be Japan's largest export 
market. Although the common wdsdon '!' 
these days is that Japan will not buy 
U.S. products, the facts do not bear 
this out. Japan imported $28-billion 
worth of U.S. products in 1987, far 
more than any other nation except Ca; 
ada. To put that number into perspec- 
tive, it is more than we exported to 
West Germany, France, and Italy 
combined. 

Within this broad economic rela- 
tionship, the trade imbalance continue fii 
as a major problem. Our trade deficit 
with Japan in 1987 was about $60 billior 
out of our total global deficit of $172 
billion. There is no doubt that the U.S 
Japan imbalance must be reduced, and 
soon. 

During the past several years, we 
have developed a firm and consistent 
set of policies to increase exports to 
Japan and deal with the trade im- 
balance. These include: 



lif 



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it I 



rniK 



*: 



32 



Department of State Bulieta., 



EAST ASIA 



• Working for the removal of trade 
Uriers affecting individual U.S. 
iducts; 

• Working w^ith Japan and other 
|ntries to obtain exchange rates that 
(lect economic fundamentals; 

• Encouraging structural adjust- 
iit in the Japanese economy to 
ratly reduce its reliance on exports 

1 growth and to move toward signifi- 
;tly more domestic-led growth; 

• Taking action under our trade 

, s, when necessary, to remove re- 
lative trade practices; and 

• Cooperating with Japan interna- 
(lally to strengthen the world trade 
|tem and promote the success of the 
(' trade round. 

We have succeeded in opening the 
ianese market in many areas, but too 
!iy import barriers remain. Much 
■k remains to be done, although 
an now has the lowest average im- 
t tariffs of any major industrial na- 
1. Because of our efforts, various 
riers to imports of U.S. fish and fish 
ducts, tobacco, legal services, and 
;st products have been removed, 
an is one of the few countries now 
loving barriers to trade. Apart from 
'thing else, doing so will result in 

higher standard of living that the 
anese people have earned. 

We should not underestimate the 
nificance of the changing nature of 
an's economy. In the past few years, 
anese poHcymakers have adopted 
icies to reorient production and in- 
tment toward domestic sectors, to 
rease imports, and to maintain 
uctural reforms in order to sustain 
linflationary growth. These policies 
■ succeeding as the Japanese econ- 
y has emerged with vigorous 
iwth, close to 4% in 1987, on the 
ength of domestic demand. The same 
inomic results are projected for this 
ir as well. The continued strength of 
' Japanese economy has also made a 
nificant contribution to sustaining 
bal economic expansion. 

servations 

t me add some of my own personal 
lervations on the conduct of our eco- 
nic relations with Japan. In the 
irse of the series of intense trade 
jotiations during my time as as- 
tant secretary, the U.S. and Jap- 
;se Governments have worked 
;ether to solve problems. Some of the 
jotiations have been strained at 
les, but they have been successful, 



especially in seeking greater market ac- 
cess for U.S. firms in the areas of tele- 
communications, medical equipment 
and pharmaceuticals, electronics, forest 
products, and financial services. 
Through the talks, Japanese agencies 
and U.S. agencies have established du- 
rable working relationships. The nego- 
tiations have been educational for both 
sides, and the cooperation they have 
engendered will continue to be essen- 
tial, given the growing integration of 
the U.S. and Japanese economies. 

In our attempt to deal with the ef- 
fects of trade on our own industries and 
with political pressures in the United 
States, we often forget that other dem- 
ocratic governments must deal with 
much the same political realities and 
problems. This is by no means an argu- 
ment for inaction. Rather, we should 
keep a sense of proportion in our rela- 
tions with Japan and our other trading 
partners when dealing with trade prob- 
lems. The goal we must strive for, 
through international trade and invest- 
ment, is increased prosperity for our- 
selves and the global economy. 
Protectionism, therefore, is not the an- 
swer to our trade difficulties. 

In the present international econ- 
omy, goods and funds flow easily across 
borders. Businessmen have many op- 
tions. If interest rates are high in one 
country, companies can borrow in an- 
other. If the yen appreciates, Japanese 
businesses are likely to invest in the 
United States or serve this market 
from third countries. If we bar imports 
from one country, we are likely to see 
shipments from others. To survive in 
this kind of world, we must look to the 



fundamentals. We must save and in- 
vest, research and innovate. The gov- 
ernment must create an environment 
conducive to these things. But only pri- 
vate individuals and companies can ac- 
complish them. 

I think that both Japan and the 
United States are headed in the right 
directions. As a result of the yen's ap- 
preciation, in volume terms, Japanese 
exports to the United States are declin- 
ing, and Japanese imports from the 
United States are growing. The United 
States is taking steps to correct coun- 
terproductive economic policies of its 
own. At the same time, the Japanese 
Government has resolved to alter its 
economic structure. The United States 
and Japan are supporting the economic 
policy coordination process adopted at 
the Tokyo and Venice economic sum- 
mits, and market access negotiations on 
specific products will continue. 

In conclusion, I would like to leave 
with you the message that our current 
problems, including those in the trade 
area, should be viewed in the perspec- 
tive of the fundamentally strong ties 
between the United States and Japan 
and of other problems we have ad- 
dressed and solved over the years. I am 
confident that, through perseverance 
and cooperation, the United States and 
Japan will solve their economic prob- 
lems in a way that will contribute to 
increased prosperity in each country 
and to an ever more solid and produc- 
tive relationship across the board. This 
is all the more essential as our rela- 
tionship continues to expand beyond 
the bounds of the bilateral and becomes 
truly global in scope. ■ 



Pacific Development and 
the New Internationalism 



by Richard H. Solomon 

Address before the Pacific Future 
Conference in Los Angeles on March 
15, 1988. Mr. Solomon is Director of the 
Policy Planning Staff. 

We live in a time when for many people 
the words "Pacific" and "future" are 
nearly synonymous. The nations of the 
Pacific rim have grasped the tech- 
nological and economic trends that are 
transforming our world. They are the 



pace-setters of a new internationalism 
that is reshaping our lives and the 
world order of the 21st century — now 
little more than a decade away. 

• The economic dynamism of the 
Pacific rim is now a crucial source of 
growth for the global economy. Japan, 
of course, has led the way and is now 
an economic superpower with major 
global responsibilities, as well as our 
anchor in East Asia. 

• The new centers of economic 
power and political influence in the Pa- 
cific are steadily moving the world 



v_L£aS_ 



33 



EAST ASIA 



away from the bipolar era of the post- 
World War II years. 

• The struggle for democracy in 
the Philippines and South Korea re- 
flects a worldwide surge toward more 
open politics. 

• And — of particular concern to 
those of us involved in foreign policy 
planning — important changes, now 
underway among the region's major 
communist powers, may hold the pros- 
pect for a more secure Pacific. 

As the 14th Director of the State 
Department's Policy Planning Staff— 
whose founding fathers were George 
Kennan and Paul Nitze— I am keenly 
aware that for nearly three decades our 
internationalism remained firmly cen- 
tered on Europe. It was with Europe- 
through the Bretton Woods agree- 
ments, the Marshall Plan, and NATO— 
that the structure of the postwar inter- 
national system was created; a system 
that, four constructive decades later, 
has brought us to the edge of a new ' 
world. 

When the Policy Planning Staff was 
first established, in the spring of 1947, 
the Pacific was anything but "pacific."' 
When Americans faced Asia in those 
days, they saw the newly victorious 
communist regime in China, the Sino- 
Soviet alliance, the Korean war, and 
then— in the 1960s and early 1970s— the 
war in Vietnam. 

Yet, in the past decade, our per- 
spective on the Pacific has changed dra- 
matically: from the challenges of 
warfare to those of economic competi- 
tion; from hostile political rivalry to 
normal relations with former adversar- 
ies; from distant countries with esoteric 
cultures to new partners in a global 
process of change. We have had to 
broaden our international outlook to 
include a dynamic region that in- 
creasingly rivals Europe for influence 
in world affairs. 

Our challenge as Americans is to 
grasp the essence of the trends that are 
transforming the Pacific and to balance 
our relations with the region with our 
continuing commitments to Europe. 
America is an island continent that 
links the two great oceans, and we can- 
not pursue our Pacific interests at the 
expense of those across the Atlantic, or 
vice versa. 

Nothing illustrates this truth bet- 
ter than the recent arms control treaty 
on eliminating medium and shorter 
range nuclear missiles. We made it 
clear in the course of negotiations with 
the Soviets that we would not sign an 



agreement which merely shifted the 
SS-20s from west of the Urals to the 
east. We could not tell our allies and 
friends in the Pacific that the price of 
greater security for Europe must be 
greater insecurity for Asia. We could 
not, and we did not. And we will not do 
so as we now pursue a much broader 
arms control agenda, including re- 
straints on strategic and conventional 
arms, chemical weapons, and the grow- 
ing global market for high-techology 
weaponry. 

New security challenges, of course, 
are but one dimension of the new inter- 
nationalism. I want to take this oppor- 
tunity to e.xplore with you the other 
critical challenges we face in the 
Pacific: 

First, structural adjustments in a 
global economy that is being trans- 
formed, in part, by new technologies 
and the challenge of trade imbalances 
that reflect this transformation; 

Second, the surge of democracy in 
the Pacific and the tasks we face in 
helping the Philippines and South 
Korea to consolidate their more open 
political systems; 

Third, the unique, outward-looking 
regionalism of the Pacific and problems 
of linking the region to the global sys- 
tem; and 

Finally, the security challenges 
that remain, especially the issue of how 
to deal with the communist countries as 
they struggle to keep pace with the 
market-oriented economies of the Asia- 
Pacific region. 

Our Economic Future 

Let me begin with the Pacific's as- 
tounding economic progress. It is not 
just the production of wealth in the re- 
gion that has impressed the world. The 
ability of many "developing" nations to 
leap-frog from basic industry into the 
computer age in just one generation 
has seized our imagination. 

Now, as we approach the end of 
this century, another series of economic 
transformations is at hand. Let's start 
with agricultural production. Malthus 
is being stood on his head. The capacity 
to produce food is not a limiting factor' 
for world population growth. Bio- 
technology is creating new varieties of 
pest-, frost-, and drought-resistant 
crops which are bringing rich harvests 
to countries heretofore dependent on 
agricultural imports. And when new 
agricultural technologies are combined 
vvith market-oriented reforms, produc- 
tion increases dramatically. 



it 



Take China, for example. Stimu- * 
lated by Deng Xiaoping's reform pro- 
gram, the most populous nation in th 
world has increased its agricultural o 
put by 50% over the last 6 years. Suo 
developments make ever more costly 
and futile the agricultural subsidies 
that are the focus of the current GAT 
[General Agreement on "Ririffs and 
Trade] round. 

Then consider the relationship hi 
tween new technologies and basic 
commodities. Science is changing tht 
marketplace for raw materials by re- 
ducing the demand for such basic con 
modities as copper and steel. Every 
month seems to bring a new advance 
the field of superconductivity, which i 
time could revolutionize the world's ei 
ergy markets. The lesson here is that 
country's natural resources matter le? 
than its human resources — the scien- 
tific skills and entrepreneurial talent 
its people. 

Another trend transforming the 
world economy is the globalization o 
production processes. In recent year 
multinational sourcing, manufacturing! 
and marketing have become the rule 
more than the exception. About 40% . 
U.S. trade, for instance, involves one 
branch of a firm selling to another 
branch located in a different country. 
Today's successful firms source globall 
use the newest technologies from 
around the world, and employ fewer 
but more skilled workers. This means 
higher level of international economic 
integration and a market that is globa) 
in scope. 

Communications and informatio i 
advances are erasing the old distinc- 
tions between international and domeS' 
tic affairs— blurring the boundaries of 
the nation-state and giving rise to wha 
some call the "information age." Do- 
mestic issues now rapidly become mat- 
ters of international interest, and vice 
versa. Information and knowledge are 
now readily available to a global scien- 
tific community, and a society's open- 
ness—or glasnost, as the Soviets are 
discovering— is fundamental to the 
most advanced levels of economic 
development. 

Business itself has been greatly 
changed by the emergence of global fi- 
nancial markets. Deregulation and the 
sheer force of technological change havf 
fused the world's financial centers into 
a global network of tremendous speed 
and scope. Markets are no longer 
places but electronic networks. Vast 
flows of money— estimated at $1 trillion 
a day — can move rapidly in response to 



ilv 



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34 



Deoartment of State BulletlrSfl" 



EAST ASIA 



Itical and economic news, as we saw 
'black" Monday, when the New 
k, London, Tokyo, and Hong Kong 
k markets reacted to each other in 
time. 

Finally, service industries — partic- 
ly finance, data processing, soft- 
ie development, engineering, and 
lagement consulting — have become 
fastest growing sector for employ- 
it. More goods are becoming knowl- 
e-intensive as they embody these 
i-technology services. Clearly, a 
e educated and skilled work force 
become a prerequisite for economic 
jipetitiveness. 
These technologically driven trends 
contributing to a dramatic disper- 
1 of economic power. Over the past 
lade, a number of Pacific rim nations 
e graduated from the ranks of the 
veloping countries" to become 
Id-class performers in one or an- 
er technological area. China, for ex- 
ile, is now commercializing its 
ce-launch capacity. Computer chips 
now a major source of foreign ex- 
nge for Malaysia. And South Korea 
rapidly become a major global 
,fer in the manufacture of automotive 
iponents and in ship construction. 
The high-growth nations of the 
ific have benefited more than most 
Ti the scientific and technical trends 
t are changing our world and from 
openness of the international trad- 
system. But their future pros- 
ity — our prosperity — depends on 
I critical and interrelated factors. 

First, maintaining — indeed, ex- 
iding — the openness of the global 
ding system; and 

Second, dealing with the serious 
de imbalances which now threaten 
t system. 

A "globalized" American economy 
ans that we can no longer success- 
y pursue our national commercial in- 
ests without considering global 
iditions and trends. Economic logic 
i our own well-being argue that the 
nciple of economic openness must be 
• (Cornerstone of our international 
inomic policy. Yet some Americans 
'. showing signs of doubt. Just as our 
)nomy is poised for strong export 
,)wth and adjustment in our trade 
Scit, we must not jeopardize our fu- 
•e with short-sighted, protectionist 
:islation under the guise of "fair 
de." 



Instead, we must pursue the 
course illustrated most clearly by the 
recently concluded U.S. -Canada free 
trade agreement. This pioneering ac- 
cord will eliminate trade barriers be- 
tween ourselves and our neighbor to 
the north — both of us Pacific rim coun- 
tries — and create important new oppor- 
tunities for growth. 

The liberalization of trade to 
promote global economic expansion is 
also our goal in the Uruguay Round of 
multilateral trade negotiations now un- 
derway in the GATT. The Uruguay 
Round is designed to open markets, 
strengthen existing trading rules, and 
extend those rules to new areas such as 
agriculture, services, intellectual prop- 
erty, and investment. 

A transition to new relationships 
among the major players in the global 
economy is clearly underway. Among 
the Pacific Basin countries, Japan and 
the "four tigers" of East Asia now bear 
a much greater responsibility for the 
health of the world economy. Their pro- 
ductivity, their income, and their 
share of world output and trade admit 
of no other conclusion. 

It follows that these countries must 
now share a commensurate responsibil- 
ity for maintaining and expanding the 
openness of the world economy. This 
means setting realistic exchange rates, 
restructuring economies to seek growth 
from domestic markets as well as ex- 
ports, and lowering outdated barriers 
to imports. 

So that is our first challenge: to 
retain the open trading system while 
we work to distribute new respon- 
sibilities according to new capabilities 
and to reduce the imbalances that now 
threaten us all with destructive 
protectionism. 

Strengthening Democracy 

Our second challenge in the Pacific goes 
to the very essence of America — our 
democracy. It used to be said that de- 
mocracy was a political system appro- 
priate only to the industrialized nations 
of the West. Yet we see in the Philip- 
pines and in South Korea a democratic 
surge that is the Asian counterpart of 
the trend that began in Portugal and 
Spain in the mid-1970s and then spread 
throughout most of Latin America. 

The Pacific nations are also giving 
us a more profound understanding of 
the relationship between political open- 
ness and economic development. Free 
markets and democracy go together. 



After all, what are the ingredients of 
economic success? A high level of edu- 
cation, an openness to the world, a ra- 
tional distribution of decisionmaking 
power, an emphasis on individual initia- 
tive, and greater freedom of informa- 
tion and association — these are the 
building blocks of democracy, as well, 
and today the idea of democracy is 
among the most powerful political 
forces of our time. 

The transition to democracy, how- 
ever, is a difficult and fragile process. 
The open society has its enemies — from 
the far left and the far right. It is a 
process that can be reversed or sabo- 
taged — by pohtical extremism, mili- 
tarism, first-family corruption, and 
economic stagnation. 

To be specific, in the Philippines, 
financial and security assistance will be 
essential if the Aquino government is to 
defeat a persistent communist insur- 
gency, restructure its economy, and set 
the country on a course toward sus- 
tainable and equitable economic 
growth. Manila will have to do its part 
by allowing a free market to work and 
creating the right domestic environ- 
ment so that the assistance it receives 
is used effectively. But the free world 
must be there to support the effort. 

In South Korea, democracy faces a 
different challenge. The government 
and the opposition must learn the give- 
and-take of a working democratic sys- 
tem. We want the Korean Government 
to feel confident of our security com- 
mitment as it addresses contentious do- 
mestic issues in the face of a vicious 
communist adversary in the north. The 
South Koreans have a great asset in 
their strong, dynamic economy, but 
they will be challenged to continue the 
process of opening their economy — de- 
spite popular resistance — to ensure 
long-term economic growth. 

Regional Cooperation 

The economic and political transforma- 
tion of the Pacific countries has led to a 
unique, outward-looking regionalism. 
This is the third dimension of change in 
the Pacific. Asians are coming to under- 
stand that attempts to isolate their 
economies — or their political systems — 
from international influences carry an 
unacceptably high price. More and 
more, countries are discovering that 
there is a premium to be gained from 
cooperation rather than unilateral 
action. 



ly 1988 



35 



EAST ASIA 



Regional and functional groupings 
are gaining in stature, and international 
organizations such as the GATT, OECD 
[Organization for Economic Cooperation 
and Development], the IMF [Interna- 
tional Monetary Fund], the World 
Bank, and the specialized and technical 
UN agencies are playing ever greater 
roles. And regional associations now 
provide vehicles for a number of coun- 
tries to exercise broadened influence in 
global affairs. ASEAN [Association of 
South East Asian Nations] and the 
South Pacific Forum are examples of 
this trend. 

• ASEAN efforts on the Cambodia 
problem, for example, have allowed its 
members to marshal international sup- 
port for an end to the Vietnamese 
occupation. 

• In the economic arena, ASEAN 
as a group has been more effective in 
such organizations as the GATT than 
its individual member states would 
have been otherwise. 

• And the South Pacific Forum was 
instrumental in obtaining a major fish- 
eries treaty with the United States. 

These organizations also have a fre- 
quently overlooked security dimension. 
They serve to minimize conflict among 
members and provide a mechanism for 
resolving differences. The Philippines 
and Malaysia have seen it in their inter- 
est to submerge territorial disputes in 
the interest of ASEAN unity. And all 
the ASEAN states have played a role in 
providing refuge and support for the 
displaced people of Indochina. 

In the final analysis, these efforts 
reflect both a high level of regional in- 
tegration and perhaps an even higher 
degree of participation in arrangements 
that transcend the region. Notably, at- 
tempts to organize the Pacific Basin 
along the lines of a NATO or the Euro- 
pean Community have failed to take 
hold. The geographical expanse and po- 
litical diversity of the region partly ac- 
count for this fact. But it may also 
reflect an understanding in the region 
that the future is being cast in global 
terms. 

New Security Challenges 

This brings us to a fourth dimension of 
the new internationalism, the security 
challenges. Nowhere has the transfor- 
mation been more profound than in 
Asia. The emergence of the Sino-Soviet 
conflict in the early 1960s began the 
transition from a Pacific divided by the 
communist-capitalist confrontation into 



an era of diffusion of power among 
many nations. No one can forecast with 
certainty where this trend will lead. 
But the Chinese decision in the early 
1970s to normalize relations with the 
United States has been of profound 
benefit to both China's security and to 
regional stability. 

The result is that China today is 
also catching the wave of the future. 
Under Deng Xiaoping's adaptive lead- 
ership, China has worked to open its 
economy to the world and unbind the 
energies of the Chinese people from bu- 
reaucratic and pohtical restraints. The 
so-called sociahst model of develop- 
ment — whether Stalinist or Maoist — 
is clearly bankrupt, discredited by 
domestic experience and the power- 
ful example of development in the 
noncommunist world. 

Now it is Moscow's turn to wrestle 
with the burden of its Soviet past. Mr. 
Gorbachev and his reformist comrades 
clearly see the global trends that are 
impelling the market-economy states 
into a new era of growth. And whatever 
perestroyka may finally come to mean, 
it is clear that a closed, militarized so- 
ciety can only spell economic disaster. 

Central to Gorbachev's foreign pol- 
icy reforms has been a new approach to 
the Pacific. Speaking in Vladivostok in 
the summer of 1986, the General Secre- 
tary argued for rapprochement with 
China, a less militant Soviet approach 
to regional problems, and — above all — 
Soviet participation in the economic 
growth of the Pacific Basin. 

Yet, nearly 2 years later, the prom- 
ise of Vladivostok remains unfulfilled. 
This major Soviet port on the Pacific 
remains a closed military bastion, and 
Asians still see the Soviet Union as a 
threat to their security. 

• Despite Gorbachev's call at 
Vladivostok for a reduction in the So- 
viet military presence in the region, 
there have been no significant reduc- 
tions. With the exception of a showcase 
troop withdrawal from Mongolia, the 
Soviet military presence along the Sino- 
Soviet border and the occupation of 
Japan's northern islands remain vir- 
tually unchanged. 

• In Cambodia, Moscow continues 
to underwrite the Vietnamese military 
occupation to the tune of hundreds of 
millions of dollars annually. Despite ex- 
pressions of support for a diplomatic 
solution to the conflict, we see no signs 
that Moscow is willing to put at risk its 
mihtary access to Cam Ranh Bay in 
Vietnam by pressuring Hanoi to come 
to the bargaining table. 



.A3 



And then there are the two com- ''"* 
munist recalcitrants in Asia, Vietnan 
and North Korea — military threats t 
their neighbors, even as they remain 
mired in economic stagnation. 

• Vietnam's military occupation ( 
Cambodia, its refusal to negotiate wi 
Prince Sihanouk, and its strong pres 
ence in Laos indicate that Hanoi has 1 
not yet abandoned its hopes of creatiil 
an Indochina federation. 

• And North Korea's threat to 
peace on the Korean Peninsula is un- 
diminished. Pyongyang continues to 
engage in such vicious acts of state- 
sponsored terrorism as the bombing i 
South Korea's leadership in Burma in 
1983 and the more recent destruction 
a South Korean civilian airliner on a 
flight from the Middle East. 

Still, there are interesting, 
if ambiguous, signs of change: in 
Afghanistan, we are encouraged by 
Moscow's publicly stated willingness t 
end its military occupation. But we 
have to make sure that, in withdraw- 
ing, the Soviets do not continue to pr 
vide arms to their client regime and 
thus pi'olong the violence or achieve j 
litically what they have failed to gain 
militarily in 8 years of brutal warfare 

In present circumstances, our tas 
is to respond to changes in the comm 
nist states with caution and prudence t 
while firmly supporting our front-line r, 
friends, including Pakistan, South h 
Korea, and Thailand. ii 

Beyond these security issues, the ;; 
Pacific has begun to experience a par- 
ticularly troublesome dilemma of our 
times. Although advanced technology 
holds tremendous opportunities for eo 
nomic progress, it also poses great 
risks to international security. As we 
see in the Iran-Iraq war, sophisticated | 
weaponry is widely available in the in- \\ 
ternational arms markets. 

Asia's emergence as a center of 
high-technology industries will require 
its nations to act aggressively to moni- 
tor and limit the availability of ad- 
vanced weaponry. The spread of such 
arms to regional adversaries or to ter- 
rorist networks would be particularly 
harmful to the international system. 
Moreover, because many advanced tech 
nologies have military, as well as com- 
mercial, applications, we will have to 
work together to control the spread of 
dual-use items and prevent their use bj 
states bent on damaging the interna- 
tional order. 



36 



Department of State Bulleti-' 



EAST ASIA 



iclusion 

;hat is the new internationalism — 
|i opportunities and the challenges — 
Bve deal with change in the Pacific 
H the broader transformation of the 
jirnational system: 

• An ever-more integrated, high- 
mology global economy, where rapid 
kvth and the need for restructuring 
jatens to produce a protectionist 
klash against an open trading 

:em; 

Popular pressures for more open 
tics and the dangers to fragile dem- 
litic institutions from the totalitarian 
and the authoritarian right; 

• The erosion of national bound- 
is through instantaneous electronic 
imunications and through economic 
•es that are integrating national 
nomies into new regional and global 
:erns; and 

• The struggle of the communist 
.es to become competitive in a world 
vhich market-oriented economies, 

trend toward democracy, and inter- 
ional associations of free nations are 
ling the way into the 21st century. 

No one should underestimate the 
ential for disruption as we go 
ough these changes. Yet, we have 
■d reason for confidence about the 
are. After all, our challenges are 
se of social progress; of cultural in- 
ation; of growing prosperity and 
ater security for the United States, 
allies, and its friends. The chal- 
ges play to our strengths. 

As Secretary Shultz likes to put it, 
re face up to our responsibilities as 
ll as our opportunities, it is clear 
t the democracies of the Pacific rim 
d the winning hand. ■ 



Indochinese Refugees 

and Relations With Thailand 



by William A. Brown 

Statement before the Subcommittee 
on Asian and Pacific Affairs of the 
House Foreign Affairs Committee on 
February 2h, 1988. Ambassador Brown 
is U.S. Ambassador to Thailand.^ 

I am pleased to be here today to dis- 
cuss with you the issue of Indochinese 
refugees and its impact on our impor- 
tant bilateral relationship with 
Thailand. I realize that the impetus for 
this hearing is the rapidly evolving sit- 
uation with regard to Vietnamese boat 
arrivals on the east coast of Thailand. 
Nonetheless, one cannot effectively ad- 
dress this specific situation without 
looking at the broader context of the 
Indochina refugee issue which affects 
most of the ASEAN [Association of 
South East Asian Nations] states as 
well as our bilateral relationship with 
Thailand. 

The Refugee Situation in Thailand 

The partnership between the interna- 
tional community and Thailand in 
providing asylum and subsequent reset- 
tlement to Indochinese asylum seekers 
has, in general, been one of the great 
humanitarian success stories of the past 
decade. Thailand has provided refuge to 
nearly 1 million persons who fled Indo- 
china. In turn, the international com- 
munity has resettled over 575,000 of 
these refugees in the West. The United 
States has played the leading role in 
this effort, resettling over 400,000 refu- 
gees out of Thailand. 

Yet, despite this resettlement 
effort, the Thais find themselves still 
providing refuge to over 400,000 Indo- 
Chinese refugees and "displaced per- 
sons." There is no immediate prospect 
for the safe return of the 288,000 
"displaced Khmer" on the Thai- 
Cambodian border to their home coun- 
try. In addition, of the 112,000 asylum 
seekers in UNHCR [UN High Commis- 
sioner for RefugeesJ-supported camps, 
nearly 69,000 have been in Thailand 
more than 3 years. 

Furthermore, the Thai see a sud- 
den upsurge of Vietnamese boat arriv- 
als after several years when it appeared 
that the flow might be under control: 
11,245 Vietnamese boat people entered 



Thai refugee camps in 1987, nearly tri- 
ple the total of 3,886 boat arrivals in 

1986. The Thai Government also acted 
in 1987 to begin to regularize the status 
of more than 9,600 Hmong who were 
illegally residing in Ban Vinai Camp, 
many of whom had entered Thailand in 
the last year. 

Under these circumstances, it is 
not surprising that there arose voices in 
Thailand questioning whether a con- 
tinuation of the kingdom's generous 
first asylum policy was in the national 
interest. The Thai press and public 
opinion is virtually unanimous in dis- 
missing the new wave of arrivals as 
"economic migrants" or "opportunists." 
Some even see in this new flow a delib- 
erate Vietnamese attempt to undermine 
Thai security, while others worry about 
the corruption associated with wide- 
spread smuggling activities, of which 
"people smuggling" is only one 
element. 

Whatever the character of this new 
wave of arrivals, one fact remains 
clear — the policies of the Government of 
Vietnam remain the root cause of the 
continued Indochinese refugee outflow. 
The sophisticated smuggling operation 
that moves large numbers of Viet- 
namese citizens through Cambodia to 
Thailand could only take place with offi- 
cial tolerance, if not official approval. 

Nonetheless, Thailand continued to 
accept large numbers of refugees in 

1987. In addition, the Royal Thai Gov- 
ernment took a number of commenda- 
ble steps, some of them unprecedented, 
directly responsive to U.S. human- 
itarian concerns. These included: 

• Granting the United States full 
access to interview and resettle border 
Khmer with close family members in 
the United States under the special 
border humanitarian parole/immigrant 
visa program; 

• Giving the United States access 
to process the nearly 7,000 "ration card 
holders" at Khao-i-Dang; 

• Opening up access for the Hmong 
to the refugee screening process by ad- 
mitting to screening 9,600 Hmong il- 
legally in Thai refugee camps; 

• Allowing international access and 
assistance to the more than 1,500 Nam 
P\in Hmong, including authorizing their 
processing for third-country resettle- 
ment; and 



ly 1988 



37 



EAST ASIA 



• Improving protection at the 
Khmer border displaced persons 
camps, particularly through the estab- 
lishment of a legal market at Site Two, 
the planned replacement of the Thai 
rangers by a new unit to provide pro- 
tection to Khmer displaced persons, 
and authorization for expanded 
education. 

The Current Problem: 
Vietnamese Influx Into Thailand 

While the Thais took these significant 
steps, no solution was found to the dif- 
ficult problem of the continued influx of 
Vietnamese boat refugees into 
Thailand. My Embassy reported to 
Washington as early as October 1987 
that creative new approaches were re- 
quired to address the Thais' legitimate 
concerns over the Vietnamese boat in- 
flow in a manner consistent with our 
own humanitarian concerns. 

The problem finally came to a head 
in January 1988. January marked the 
third straight month in which boat 
Vietnamese arrivals were at record 
highs, not seen in Thailand since 1981. 
There were almost 6,000 new boat ar- 
rivals in the period November 1987- 
January 1988. Equally important, the 
vast majority of these new arrivals 
came via the east coast of Thailand, 
mostly through the Province of Trat. 
The passage was not that of the tradi- 
tional "boat people" who braved long 
and dangerous trips across the seas 
from Vietnam to reach the shores of the 
free countries of Southeast Asia. In- 
stead, these new arrivals came via a 
sophisticated smuggling network 
through Cambodia by land and then on 
a short boat trip to the coast of Trat. 
Many, indeed most, Thais questioned 
whether this new group was as deserv- 
ing of first asylum as the "traditional" 
boat people. 

Faced with these growing pres- 
sures, the corruption and the threat to 
national security posed by smuggling 
generally between Thailand and Cam- 
bodia, the Ministry of Interior acted 
vigorously to tighten up on admitting 
refugees to the east coast of Thailand. 
A meeting chaired by the Interior Min- 
istry in Trat on January 27 resulted in 
a dramatically new Thai approach de- 
signed to deter future east coast boat 
arrivals. A naval and marine police 
blockade was set up to turn back boats 
carrying Vietnamese asylum seekers 
trying to enter Thai waters from Cam- 
bodia. Those Vietnamese who did man- 
age to reach shore were to be pushed 
off in boats back to Cambodia. Viet- 
namese already ashore, but not yet in a 



38 



refugee camp, who were determined to 
have come to Thailand via a short trip 
from Cambodia would be heretofore 
treated as "land Vietnamese" and sent 
to the Site Two displaced persons camp, 
as part of an overall tough deterrence 
policy. 

The implementation of this new 
policy had some tragic consequences. 
Between 500 and 550 Vietnamese 
asylum seekers were pushed off Thai 
shores betwen January 27 and Febru- 
ary 11, according to our information and 
the public statements of local Trat offi- 
cials. On the basis of second- and third- 
hand reports, we estimate more than 
100 persons have died, primarily from 
drownings after boats were pushed off 
but, in one case, from a reported ram- 
ming by a Thai fishing vessel of a boat 
carrying Vietnamese refugees. Over 
500 Vietnamese were stranded on is- 
lands off the coast of Trat, with no reg- 
ular source of food, water, or medical 
care. 

Thai policy has been modified in 
recent days to address some of these 
problems. The [Thai] National Security 
Council decided on February 19 to give 
UNHCR access to the islands off Trat; 
provide food, water, and medical care 
under the auspices of local Thai offi- 
cials; and evacuate medical emergency 
cases to mainland hospitals. We have 
reports from Trat that these decisions 
are being implemented, with refugees 
being consolidated at several locations 
to facilitate their care and assistance. 
Furthermore, there appears to have 
been a decision made to stop boat push- 
offs. The boat interdiction program and 
policy of sending new arrivals to Site 
Two remains in effect. 

Throughout this situation, the U.S. 
Embassy has taken action simul- 
taneously on three fronts. 

First, we moved to deal with the 
immediate threat to life. 

Second, we have worked together 
with the Thai Government and the 
UNHCR toward a compromise on Viet- 
namese boat refugee policy consistent 
with both legitimate Thai national se- 
curity concerns and our own human- 
itarian interests. 

Third, we have proposed ideas that 
would address the underlying causes of 
the ever-increasing number of refugee 
crises that threaten our bilateral rela- 
tionships with Thailand. 

Our first concern was the most 
basic — the protection of human life. We 
had advance warning on January 20 of a 
possible change in Thai boat refugee 



policy. On the basis of this warning, 
sought Washington authorization to 
proach the Thais with our concerns. 
Through Mr. Victor Tomseth, Count 
Director for Thailand and Burma wh 
was visiting Bangkok, we raised this 
issue on January 25 with Suwit 
Suthanakul, the Secretary General c 
the National Security Council — the 
body charged with formulating Thai 
refugee policy. The same day, we 
briefed the Foreign Ministry on our 
concerns in preparation for the Jan- 
uary 27 interagency meeting in Trat 
which we knew would discuss this is 
sue. We stressed the importance of j 
serving first asylum and avoiding boi 
pushoffs. 

When the first boat pushoff fron 
the mainland become known on Janu- 
ary 27, my Embassy stepped up its 
efforts to persuade the Thai Govern- 
ment to maintain a humanitarian pol: 
and avoid actions that could and did 
lead to loss of life. I personally dis- 
cussed the matter in separate calls oi 
the highest government officials inclu 
ing, inter alia. Foreign Minister Side 
Interior Minister Prachuab, and the 
Secretary General in the Prime Minis 
ter's Office, Prasong. My Deputy Chi 
of Mission was equally active, calling 
senior officials at the Interior and Fo: 
eign Ministries, National Security 
Council, and Supreme Command. My 
refugee staff maintained its own intei 
sive contacts with their Thai 
counterparts. 

We also worked closely with 
UNHCR, as the lead international 
agency in refugee protection in 
Thailand. UNHCR was in constant 
touch with us as it pursued its own 
intensive dialogue with senior Thai 
officials. 

We did not, however, restrict our 
efforts to Bangkok. We worked initiall 
through UNHCR which had a perma- 
nent staff in Trat and had been assist- 
ing for many months the refugees whc 
sought first asylum on the east coast. 
When we learned on February 3 that 
UNHCR had been denied access to ne 
Vietnamese arrivals, we decided that i 
more direct Embassy role was appro- 
priate. Our first Embassy/Joint Volun- 
tary Agency team visited the east coas. 
on February 5 for 2 days. By Febru- 
ary 9, we had established a 24-hour 
Embassy presence on the east coast to 
monitor the situation. That presence 
has remained continuously to this date 

Our officers on the spot quickly 
alerted to us an urgent life-threatening 
situation — the presence of over 400 
Vietnamese off the coast of Trat, many 
without adequate food and water. By 
February 11, our Embassy team was 

Department of State Bulleti? 



ill 



EAST ASIA 



on a boat visiting the islands and 
nding assistance to those refugees 
located. We continued to go out on 
ts, providing food and/or cash to 
food where we went. We also pro- 
3d our information to the appropri- 
international agencies and voluntary 
ups who could provide assistance, 
uding medical care, on a more sys- 
latic basis. Our field work played an 
)ortant role in advancing a joint 
)rt by private and governmental in- 
national agencies to provide food and 
dical assistance to the refugees on 
islands. The Thai Government has 
V agreed to a UNHCR-supported re- 
■ effort to the islands with UNHCR 
1 local government participation. The 
ibassy team remains in Trat on a 24- 
ir basis, but our role is now pri- 
rily monitoring and reporting on the 
IHCR-supported rehef effort. 

I personally visited Trat on Febru- 
' 21 prior to departing Thailand to 
end these hearings. Accompanied by 

Refugee Counselor, Embassy doc- 
, and Thai- and Vietnamese-speaking 
'cers, I visited over 1,200 Vietnamese 
ugee's in three shelters in Trat. I 

overflew by helicopter the islands, 
serving no groups of refugees not 

I eady identified and receiving as- 
Itance from the UNHCR-supported 
I ief effort. 

' The shelters we visited were 
:)wded, but the Vietnamese were in 
;od condition, and they said they were 
i ,isfied with their treatment by the 
: ai. Several of the persons I spoke 
ith had reeducation camp experience, 
(th one man having been imprisoned 
I- 12 years. 

In my talk with the governor of 
'at, I stressed our mutual interest in 

1 manitarian treatment of the Viet- 

1 mese asylum seekers and expressed 
I r willingness to work with the Thai 
«)vernment in dealing with this issue. 
Immediate action to deal with the 
ireat to life was, however, only part of 
He challenge we faced. Working with 
fiai officials and UNHCR, we sought 
i) promote a policy that would accom- 
modate Thai concerns about reducing 
e refugee flow while preserving first 
;ylum and humanitarian treatment, 
'e worked closely in support of 
NHCR's proposal to create a holdmg 
■nter for new Vietnamese boat arriv- 
s, which would deny the refugees 
.immediate access to resettlement proc- 
^sing as a means of "humane deter- 
■lUf" of new arrivals without pushoffs 
• loss of life. We also pledged to inten- 
fy (lur resettlement processing ac- 
v'ity at the existing Vietnamese boat 



Thailand— A Profile 



Geography 

Area: .513,115 sq. km. (198,114 sq. mi.): 
about the size of Texas. Cities: Capital- 
Bangkok (pop. 6 million). Other cities- 
Chiang Mai (155,471), Hat Yai (123,389), 
Nakon Ratchasima (200,051). Terrain: Four 
general regions— a densely populated cen- 
tral plain watered by the Chao Phraya 
River system; an eastern plateau bordered 
on the east by the Mekong River; a moun- 
tain range spanning the country in the 
west and separating the plain and plateau 
in east-central Thailand; and the southern 
isthmus joining the land mass with Malay- 
sia. Climate: Tropical monsoon. 

People 

Nationality: Noun and adjective— ThaKs). 
Population (1987): 54 million. Annual 
growth rate (1987): Less than l.e*?,^.. 
Ethnic groups: Thai 84%, Chinese 12%, 
other 4%. Religions: Buddhist 95%, Mus- 
lim 3%, other 2%. Languages: Thai, eth- 
nic, and regional dialects. Education: 
Years compulsory— e. Attendance— 96%. 
Literacy—S9%. Health: Infant mortality 
,.(,(e— 45/1,000. Life expectancy— M.2 yrs. 
Work force (21.4 million); Agriculture— 
58.9%. Industry, commerce, and services- 
26.3%. Government— 8.\S%. 

Government 

Type: Constitutional monarchy Consti- 
tution: December 1978. Independence: 

Never colonized. 

Branches: E xecutive— king (chief of 
state), prime minister (head of govern- 
ment). Lc9(.s/a;ii'P— bicameral National As 
sembly Judicial— three levels of courts. 

Administrative subdivisions: 73 
provinces, subdivided into 650 districts. 

Political parties: Multiparty system; 
the Communist Party is prohibited. 
Suffrage: Universal over 20. 

Central government budget: About 
$9.4 billion (243 billion baht). 



Defense: 17.6% of budget. 

Flag: Two red stripes at top and bot- 
tom, two white inner strips, and wider 
blue band in middle. The blue represents 
royalty; the white, Buddhism; and the red, 
"Thailand." which means "land of the 
free." 

Economy 

GNP (1986): $40 billion. Annual growth 
rate: 3.4%. Per capita income: $771. Avg. 
inflation rate: 4.3%. 

Natural resources: Tin, rubber, natu- 
ral gas, timber, fisheries products, tung- 
sten, lignite, zinc. 

Agriculture (16.7% of GNP): Prod- 
ni-ts — rice, corn, sugarcane, manioc. 
Land— 24% agricultural. 

Industry (20.6% of GNP): Types— tex- 
tiles, agricultural processing, wood prod- 
ucts, tin and tungsten mining. 

Trade: Exports— $S.S02 million: tex- 
tiles, rice, fish products, rubber, tin, tap- 
ioca, shrimp, corn, sugar, precious stones/ 
jewelry. Major markets — Japan, EC, US, 
Singapore, Hong Kong. Imports— $9, \S6 
million: petroleum, machinery, food, capital 
equipment, fertilizer, chemicals. Major 
sources — Japan, EC, US, ASEAN. 
Official exchange rate: 26.27 
baht = US$1. 

Membership in International 
Organizations 

UN and some of its specialized agencies, 
including the World Bank Group and Gen- 
eral Agreement on Tariffs and Trade 
(GATT); Association of South East Asian 
Nations (ASEAN); Asian Development 
Bank; INTELSAT 



Taken from the Background Notes of 
March 1988, published by the Bureau of 
Public Affairs, Department of State. 
Editor; Juanita Adams. ■ 



jlay 1988 



39 



EAST ASIA 



refugee camp at Phanat Nikhom to ad- 
dress Thai fears that they had too 
many boat Vietnamese in their country. 

I offered the Thais a comprehen- 
sive approach to dealing with the boat 
refugee problem in a February 19 letter 
to the Foreign Minister. Drawing on 
ideas from the Thai Ministry of Inte- 
rior, the UNHCR, and my Embassy, I 
presented — with the State Depart- 
ment's concurrence — a six-point plan 
for resolving the current crisis involv- 
ing Vietnamese boat arrivals. This plan 
incorporated not only immediate life- 
saving measures but also steps to con- 
solidate the Vietnamese who have 
landed on islands or are now located in 
mainland beach shelters. It also incor- 
porated measures to speak to the Thai 
concern about the buildup of Viet- 
namese refugees in Phanat Nikhom, to 
provide incentives for future asylum 
seekers to use the Orderly Departure 
Program and, finally, to support 
UNHCR in the search for durable solu- 
tions beyond the traditional resettle- 
ment approach. The initial response of 
the Thai Government to these proposals 
has been positive. 

Addressing the Underlying 
Issues in the Refugee Program 

The need to address the underlying 
causes of the refugee dilemma in South- 
east Asia forced us to grapple with the 
most difficult choices. There are, 
frankly, no easy answers to the di- 
lemma of dealing with the continued 
flight of persons from Indochina — 12 
years after the end of the Vietnam 
war — at a time when other compelling 
refugee situations are demanding our 
attention and resources. With the help 
of my staff, however, I came to the con- 
clusion that the core issues in the cur- 
rent refugee dilemma in Southeast Asia 
can be most effectively addressed with 
the following four-point approach. 

One, exercise U.S. leadership in 
developing a comprehensive interna- 
tional strategy involving both resettle- 
ment and first-asylum countries for 
dealing with the long-stayer and poten- 
tial long-stayer refugee population in 
the region. Such a strategy needs spe- 
cifically to address the issue of what to 
do with the growing number of Indochi- 
nese asylum seekers who do not qualify 
under current criteria for third-country 
resettlement. 

Two, develop an effective and equi- 
table refugee screening system that en- 
sures first asylum for legitimate 



refugees while reducing the overall ref- 
ugee flow to a level which can be han- 
dled by the third-country resettlement. 

Three, continue to reinvigorate the 
Orderly Departure Program from Viet- 
nam with a particular focus on Amera- 
sian children and former reeducation 
camp inmates, two groups of special hu- 
manitarian concern to the United 
States. 

Four, carry out an intensive di- 
alogue with Vietnam on the possibility 
of repatriation with strict international 
safeguards of persons prepared to re- 
turn to their homeland. 

The Broader U.S. 
Relationship With Thailand 

The refugee issue is properly of great 
concern to this committee, as it is to 
the people of the United States. It is 
one of the most important issues in our 
relationship with Thailand. 

If I may, however, I would like to 
take this opportunity to broaden our 
focus beyond the particular issue of ref- 
ugees and relate it to our overall rela- 
tionship with Thailand. As American 
Ambassador in Bangkok, I have the re- 
sponsibility of dealing with the Royal 
Thai Government simultaneously on a 
wide range of matters which have an 
equally great bearing on the security, 
health, economic well-being, and hu- 
manitarian interests of the American 
people. I refer particularly to the areas 
of security, narcotics, and trade. 

On balance, our relationship with 
the Thai Government and people in 
these four areas — refugees, security, 
narcotics, and trade — has been amica- 
ble and has clearly served the interests 
of both our countries. But it is also true 
that when difficulties arise in one 
sphere, the spill-over impact on other 
dimensions of our relationship is often 
instantaneous and sometimes severe. 

Security. Thailand and the United 
States are joined in mutual defense as 
treaty allies under the Manila Pact of 
1954, a relationship strengthened by 
the 1962 Rusk-Thanat communique, and 
security issues are always at the top of 
our mutual agenda. Thailand fought 
with the United States and its allies as 
far back as World War I and as recently 
as Vietnam. We share with the Thai a 
deep concern about the growth of the 
Soviet presence in Southeast Asia, par- 
ticularly Soviet support for the illegal 
Vietnamese occupation of Cambodia. 
Our Thai friends are providing impor- 
tant cooperation in efforts to defend 
the region and maintain the security of 
vital shipping lanes. 



We are also sensitive to Thai con- 
cerns — as a front-line state in the de- 
fense of freedom — about the presence 
of Vietnamese troops on their border 
with Cambodia and also in Laos. In 
that connection, let us not forget thatl|!^' 
Thailand has, until a few days ago, 
been involved in some very bloody 
fighting on its border against the fore ""i 
of a Lao Government which is sup- 
ported by Vietnam and the U.S.S.R. 
Last year, it faced Vietnamese Army 
incursions on its border with 
Cambodia. 

Both our countries take regular 
steps to nurture our mutually benefici 
security relationship. Our continuing 
strong support for Thai security is 
demonstrated in such areas as the Wai' 
Reserve Stockpile that we jointly are 
about to establish in Thailand and 
through our declining, but still signifi- 
cant, security assistance for the mod- 
ernization of Thai military forces. Our 
two nations benefit from an active pro- 
gram of joint military exercises, this 
year numbering more than 30. Thailan 
is one of a dimishing number of coun- 
tries that permit us to exercise in theii 
territory. When adding up the various 
benefits that the United States derives 
from this relationship, it is worth not- 
ing that, as we meet today, the U.S.S 
Midway and seven other vessels of the jj] 
U.S. Seventh Fleet, freshly in from 3 
months on station in and near the Per- 
sian Gulf, are paying visits to two of 
their favorite liberty ports, Patthaya 
Beach and Phuket, and that this year 
more than 60 other U.S. ships are 
likely to put in for rest at these two 
Thai ports. 

Narcotics. Another issue of the 
greatest concern to the American peo- 
ple is narcotics. The notorious Golden 
Triangle — which covers parts of Burma, 
Laos, and northern Thailand — is the 
source of a significant percentage of the 
world's opium and heroin. The Royal 
Thai Government has committed itself 
to cooperation in this issue. It has 
made remarkable strides in eradicating 
the opium produced within Thai ter- 
ritory and is eradicating marijuana 
fields wherever they are found. This 
has not been an easy task as Thai mari- 
juana growers are encouraged by 
American criminal syndicates. The Thai 
have welcomed a large DEA [Drug En- 
forcement Administration] presence in 
their country to provide technical and 
investigative cooperation. 

The Thai are acting with commend- 
able skill and success. Two weeks ago, 
Thai antinarcotics forces, with whom 



40 



Department of State Bulletin 



EAST ASIA 



cooperate closely, seized 2,800 
nds — more than a ton — of No. 4 her- 
headed straight for a warehouse 
r New York City and from there to 
streets of America. That haul, the 
rest in history and worth hundreds 
nilhons of dollars, may have ex- 
ded the total amount of heroin going 
he United States from the Golden 
angle during all of 1987. The cooper- 
|)n between our two countries that 
kes such a seizure possible does not 
le easy, and I cannot emphasize to 
I strongly enough the value which 
United States derives from it. It is 
result of extremely painstaking 
'k and cultivation of good relations 
ween our two countries at all levels. 

Trade. Important to the defense of 
isdom and preservation of our shared 
ties is a healthy economy, and the 
lis have this by and large, although 
■kets of poverty exist in the coun- 
side, particularly in the populous 

theast. They have one of the most 
lamic free enterprise economies in 

world, and it provides a secure in- 
tment area for the capital of many 
American company. The United 
ites takes more of Thailand's man- 
ctured exports than any other coun- 
. We are Thailand's most important 
rket, although our own imports from 
ailand are dwarfed by our imports 
m other Asian countries such as 
ina, Hong Kong, Japan, Taiwan, and 
jth Korea. In sum, Thailand is hop- 
: to move into the big leagues of in- 
national trade. With that status 
ne some problems as the Thai 
)e with textile quotas and other 
il and perceived evidence of U.S. 
"otectionism." 

Visiting congressional delegations 
ning to Thailand in recent years have 
'ariably stressed to me that they are 
tting intense heat from their constit- 
nts about trade issues. The American 
3ple, they tell me, have made it plain 
it, however they may feel about lim- 
tions on certain imports into the 
lited States, they want to see a world 
free and fair trade for the goods 
tierica wants to export to the inter- 
tional marketplace. The Thai have 
nefited greatly from the openness of 
; U.S. market, and they have a good 
:ord overall of providing access to 
;ir markets as well, but they could do 
tter. And I do not mind telling them 

even when I know I am inviting a 
tare from them on how the U.S. rice 
•mers receive all kinds of benefits as 
jy compete in the world market with 
I unsubsidized, and often im- 
verished, Thai rice farmers. In this 



regard, I am bound to report bitter and 
pervasive resentment at the inclusion of 
the rice title in the Food Security Act 
of 1985 and at the failure of the United 
States to remedy that situation despite 
its demonstrated adverse effect on 
Thailand. 

Intellectual Property Rights. 

These days, intellectual property rights 
protection — through copyrights, pa- 
tents, and trademarks — has become a 
front-burner issue, and Thailand's 
mixed performance in that area is of 
great concern to our government and to 
sections of the American public who 
seek to prevent the pirating of their 
products. Notwithstanding the fact that 
the United States has not yet signed 
the Bern convention, we have asked the 
Thais to amend their copyright law to 
give us protection similar to what Bern 
convention signatories enjoy in 
Thailand. The Royal Thai Government 
has sponsored legislation to achieve 
that objective, but — as a coalition gov- 
ernment operating in a parliamentary 
context — support must be cultivated. 

The atmospherics on the issue have 
become quite heated, in an increasingly 
assertive parliament (inspired by its 
understanding of the U.S. congres- 
sional oversight role) and by a free- 
wheeling Thai press. At this point, we 
are optimistic on passage of the 
copyright bill, but it is difficult to pre- 
dict with precision where we may be 
going on the even more sensitive ques- 
tion of patents for pharmaceutical prod- 
ucts. For the immediate term there is 
no doubt that our relations will be sub- 
ject to strains which, if not dealt with 
effectively, could threaten long-term 
harm to the heretofore healthy U.S.- 
Thai trading relationship. 

Conclusion 

U.S. -Thai cooperation on security, nar- 
cotics suppression, and trade matters is 
buttressed by a warm and active peo- 
ple-to-people relationship. That rela- 
tionship extends to thousands of 
visitors traveling each year between 
our two countries, including, most re- 
cently, Senators Rollings, Bentsen, and 
Boschwitz and several separate con- 
gressional delegations led by Con- 
gresswoman Beverly Byron, as well as 
Congressmen Rangel, Atkins, Mc- 
Closkey, Pepper, and Mrazek. There 
are some 10,000 Thai students in Amer- 
ican universities, and thousands of 
Americans, including businessmen, 



Peace Corps volunteers, missionaries, 
etc., who live and work in Thailand, as 
well as a more or less permanent Thai 
community in the United States of 
300,000 persons. 

I have discussed these other facets 
of the U.S. -Thai relationship today be- 
cause it is essential to realize that we 
have a very wide-ranging relationship 
with Thailand, and the various facets of 
that relationship are not discrete. Each 
affects the others. If we can find ways 
to reach workable and supportive un- 
derstandings with the Thais over the 
myriad refugee questions that arise — 
above all, undertakings which alleviate 
their burden over the longer term — it 
will greatly facilitate our task of han- 
dling the other issues we face. Con- 
versely, a deterioration of U.S. -Thai 
understandings and cooperation on ref- 
ugees could set back our relations along 
a very wide front, indeed. 

Before I respond to questions from 
your distinguished subcommittee, may 
I respectfully draw your attention to a 
feeling which, rightly or wrongly, is 
currently shared by many Thai at all 
levels of the government and society. 
That is, bluntly, that the United States, 
which has been a long-time friend and 
to which they look with considerable 
respect based on many shared values, 
is overbearing in pressuring them on 
the refugee issue and does not under- 
stand Thai concerns. 

In examining recent Thai policy to- 
ward Vietnamese seeking first asylum 
in Thailand — or, indeed, any other con- 
tentious issue — it behooves us not to 
lose sight of the wide breadth and un- 
derlying strength of our overall and 
growing relationship with this ancient 
kingdom with which we have had 
friendly relations for 150 years and 
whose monarch was born 60 years ago 
in Cambridge, Massachusetts, close to 
Mr. Atkins' congressional district. I 
believe the U.S. -Thai relationship epit- 
omizes that which a strong, friendly, 
balanced, and mutually — let me stress 
the word mutually — beneficial rela- 
tionship between two countries 
should be. Let us all work to keep it 
that way. 



'The complete transcript of the hear- 
ings will be published by the committee 
and will be available from the Superintend- 
ent of Documents, U.S. Government Print- 
ing Office, Washington, D.C. 20402. ■ 



ly 1988 



41 



EUROPE 



Secretary Shultz Visits IVIoscow 



Secretary Shultz departed Wash- 
ington, D.C., February 19, 1988, to 
visit Helsinki (February 20-21), 
Moscow (February 21-23), and Brussels 
(February 23). He returned to Wash- 
ington on February 23. 

Folloiving is the text of the joint 
U.S. -Soviet statement of February 22. 

Secretary of State George P. Shultz and 
Foreign Minister Eduard Shevardnadze 
met in Moscow on February 21-23 for 
the first of a series of previously agreed 
meetings. Their discussions, in which 
Lt. Gen. Colin Powell, Assistant to the 
President for National Security Affairs, 
participated, encompassed a detailed 
review of all aspects of U.S. -Soviet re- 
lations. They also initiated discussions 
to prepare for the summit between 
President Ronald Reagan and General 
Secretary M.S. Gorbachev, which will 
be held in Moscow during the first half 
of 1988. 

Secretary Shultz and Gen. Powell 
were received by General Secretary 
Gorbachev and met with Chairman of 
the Council of Ministers Ryzhkov. 

The two sides agreed on the impor- 
tance of sustained progress in the 
months ahead across the full range of 
U.S. -Soviet relations, including arms 
control, human rights, regional issues, 
and bilateral affairs. To this end, they 
gave priority attention to implementa- 
tion of the agreements and instructions 
which were set forth by the President 
and the General Secretary during the 
Washington summit. To review progress 
in achieving these objectives and to 
continue their close coordination of 
preparations for President Reagan's 
visit to the U.S.S.R., Secretary Shultz 
and Foreign Minister Shevardnadze will 
meet in Washington in March. 

In their meetings over the last 
2 days, the two sides held a candid and 
constructive discussion of human rights 
and humanitarian cases. 

They reviewed outstanding ques- 
tions regarding the nuclear and space 
talks (NST), nuclear testing, conven- 
tional stability, and chemical weapons 
arms control. 

They affirmed the commitment 
made in the Washington summit joint 
statement to make an intensive effort 
to complete a treaty on the reduction 



and limitation of strategic offensive 
arms and all integral documents "at the 
earliest possible date, preferably in 
time for signature of the treaty during 
the next meeting of leaders of state in 
the first half of 1988." The ministers 
reviewed the entire comple.x of issues 
associated with the treaty, with a par- 
ticular focus on finding mutually ac- 
ceptable solutions to differences which 
still remain. Emphasizing the impor- 
tance of verification, they directed their 
negotiators to develop, by the time of 
the March foreign ministers' meeting, a 
joint draft protocol on inspection; a 
joint draft protocol on conversion or 
elimination of strategic offensive arms; 
and a joint draft memorandum of un- 
derstanding, which will be integral to 
the treaty on the reduction and limita- 
tion of strategic offensive arms. 

Concerning the ABM [Antiballistic 
Missile Treaty] as discussed during the 
Washington summit, they also directed 
their negotiators to work toward an 
agreement building on the language of 
the December 10, 1987, joint statement 
issued by President Reagan and Gen- 
eral Secretary Gorbachev. 

Noting the progress made in the 
U.S. -Soviet full-scale, step-by-step ne- 
gotiations on questions relating to nu- 
clear testing, the ministers instructed 
their delegations to accelerate work on 
verification protocols to the U.S.- 
U.S.S.R. Threshold Test Ban Treaty of 
1974 and the Peaceful Nuclear Explo- 
sions Treaty of 1976 in order to have 



draft protocols completed for their re'|i)'""'" 
view at the next ministerial meeting. 
The ministers agreed that this reflect ^f'^ 
the goal established at the Washingto 
summmit to make it possible for both *' 
sides to ratify the two treaties in 
accordance with their national laws ai 
practices. 

The ministers discussed issues re 
lating to a truly global, comprehensi 
and effectively verifiable ban on che 
ical weapons (CW). They reviewed ou' 
standing problems, exchanged views < 
ways to build confidence and increase 
openness, and agreed to study ideas i<Y- 
concrete means for making progress 
and to intensify negotiations toward 
conclusion of a convention encompass 
ing all CW-capable states. 

There was an exchange of views 
between the sides on the state of progi|lF 
ress in the Vienna talks on a mandate '™' 
for conventional stability negotiations. 
This has led to clarification and deepe 
understanding of their respective posi- 
tions. The results of these consultatioi '■' 
will be conveyed to the respective neg ' 
tiators in Vienna to assist in completii 
of the mandate. 

The two ministers conducted a 
wide-ranging and candid exchange of 
views on regional questions, including 
Afghanistan, the Iran-Iraq war, the 
Middle East peace process, Cambodia, 
southern Africa, Central America, and 
the Korean Peninsula. 

The two ministers reviewed the 
work underway to expand areas of bi- 
lateral cooperation between the United 
States and the Soviet Union. In this 
regard, they exchanged notes on devel- 
oping bilateral cooperation in the area 
of fisheries. ■ 



Soviet Foreign Minister 
Visits Washington 



Soviet Foreign Minister Eduard 
Shevardnadze visited Washington, 
D.C., March 21-23, 1988, to meet with 
President Reagan and Secretary 
Shultz. 

Following is the text of the joint 
U.S. -Soviet statement of March 23, 
1988. 

Secretary of State Shultz and Foreign 
Minister Shevardnadze met in Wash- 
ington from March 21 to 23, 1988, for 
the second of a series of meetings to 
review developments in U.S. -Soviet re- 



lations and to prepare for the meetings 
between President Reagan and General 
Secretary Gorbachev, which will take 
place in Moscow from May 29 to 
June 2, 1988. 

President Reagan received the For- 
eign Minister for a discussion of the 
state of relations and of objectives in 
the coming months in arms control, hu- 
man rights and humanitarian questions, 
regional affairs, and bilateral matters. 

The two sides gave priority atten- 
tion to implementation of the agree- 
ments and understandings recorded in 



42 



Department of State Bulletin' 



EUROPE 



joint statement issued by the Presi- 
it and the General Secretary in their 
shington meeting, as developed fur- 
■r during Secretary Shultz's visit to 
scow in February 1988. Both sides 
le worked hard, and some progress 
i been realized in a number of areas, 
; much more needs to be done. 

By mutual desire, the meetings be- 
een the Secretary and the Foreign 
nister began with a frank and busi- 
i5slike e.xchange of human rights and 
imanitarian questions. The discussion 
these issues will continue at the e.x- 
-t level. 

The Secretary and the Foreign 
nister and their senior experts held 
ensive discussions on arms control. 

They reaffirmed the strong com- 
:ment made in the Washington sum- 
t joint statement to make an 
ensive effort to complete a treaty on 
■ reduction and limitation of strategic 
snsive arms and all integral docu- 
nts at the earliest possible date, 
iferably in time for signature of the 
aty during the next meeting of the 

leaders. The ministers reviewed 
i joint draft texts of a protocol on 
.pection; a protocol on conversion or 
mination of strategic offensive arms; 
d a memorandum of understanding, 
veloped in accordance with their di- 
;tive at the February ministerial in 
)SCOw. Reemphasizing their commit- 
;nt to effective verification measures, 
2y agreed that the negotiators in 
■neva will seek to resolve the remain- 

1 differences in these documents and 
port on progress at the next 
nisterial. 

The ministers continued their re- 
3W of the key remaining substantive 
iues associated with the treaty, as 
i\\ as a wide range of treaty topics of 
terest to each side, including prob- 
ms associated with: verification and 
unting of nuclear-armed long-range 
r-launched cruise missiles (ALCMs); 
nitation and verification of nuclear- 
med long-range sea-launched cruise 
issiles (SLCMs); and mobile intercon- 
nental ballistic missiles (ICBMs). 
ley also reviewed issues related to 
iblimits on warheads within the 6,000 
vel. 

The Secretary and the Foreign 
Minister also reviewed the progress at 
le nuclear and space talks (NST) on 
le negotiations regarding the ABM 
Vntiballistic Missile] Treaty as dis- 
issed at the Washington summit. They 
irected their negotiators in Geneva to 
xpedite preparation of a joint draft 



Romania Renounces 
MFN Renewal 



DEPARTMENT STATEMENT, 
FEB. 26, 1988' 

The Romanian Government has in- 
formed us it has decided to renounce 
renewal of most-favored-nation (MFN) 
subject to the terms of the Jackson- 
Vanik agreement. Therefore, the Ad- 
ministration this year will not exercise 
the waiver authority under that amend- 
ment. The U.S. Government remains 
firmly committed to the Jackson- Vanik 
amendment as the law of the land. 

Under the Jackson- Vanik amend- 
ment, without another annual waiver, 
Romania's MFN status will expire on 
July 3, 1988. Therefore, all Romanian 
products arriving in U.S. ports after 
July 2, 1988, will be subject to the 
higher non-MFN duties. In addition, 
effective July 3, Romania will no longer 
be eligible for any U.S. Government- 
supported export credits through such 
programs as the Commodity Credit 
Corporation (CCC) or the Export-Im- 
port Bank. 

Since 1975 Romania has had MFN 
tariff status under a bilateral commer- 
cial agreement, contingent on annual 
renewal of a waiver provided for by the 



Jackson-Vanik amendment. Section 402 
of the 1974 Trade Act. 

We will be consulting with Roma- 
nian officials regarding the legal and 
policy implications for our bilateral 
commercial agreement of Romania's re- 
quest. We welcome and reciprocate the 
Romanian Government's expressed de- 
sire to continue to work for better rela- 
tions, to maintain a broad range of 
contacts and consultations, and to work 
to promote trade and economic 
relations. 

The Government of Romania has 
authoritatively stated to us it will con- 
tinue to allow emigration for family re- 
unification purposes without relation to 
economic ties with the United States. 
We welcome this. It is particularly 
important because of the continuing in- 
tense concern shared by the Admin- 
istration, the Congress, and the 
American people with human rights in 
Romania. 'This concern will continue to 
be a central part of the U.S. -Romanian 
dialogue. 



'Read to news correspondents by De- 
partment deputy spokesman Phyllis 
Oakley. ■ 



text of a separate agreement building 
on the language of the December 10, 
1987, joint statement issued by Presi- 
dent Reagan and General Secretary 
Gorbachev, allowing consideration of 
any unresolved issues at the next meet- 
ing of the Secretary and the Foreign 
Minister in Moscow. 

Taking note of further progress in 
U.S. -Soviet full-scale step-by-step ne- 
gotiations on issues of nuclear testing 
and confirming the commitment by the 
sides to the implementation of the 
agreed mandate of these negotiations, 
the ministers instructed their delega- 
tions in Geneva in particular to design 
and conduct as soon as possible the 
joint verification experiment (JVE) in 
full conformity with the December 9, 
1987, ministerial statement; complete a 
detailed plan and schedule for the JVE 
by the April ministerial; prepare a joint 
draft of the Threshold Test Ban Treaty 
(TTBT) protocol by the time of the 



JVE, to be finalized through the con- 
duct and analysis of the JVE; and ac- 
celerate work on verification issues for 
the Peaceful Nuclear Explosions Treaty 
(PNET). 

The two sides reviewed the situa- 
tion on conventional arms control, with 
special reference to the mandate nego- 
tiations in Vienna, and expressed the 
hope for their completion in the context 
of a successful outcome of the Vienna 
CSCE [Conference on Security and Co- 
operation in Europe] meeting. 

The ministers discussed the on- 
going multilateral and bilateral negotia- 
tions toward a comprehensive, 
effectively verifiable, and truly global 
ban on chemical weapons and in- 
structed their delegations in Geneva to 
continue working constructively in this 
direction. 



lay 1988 



43 



EUROPE 



The Secretary and the Foreign 
Minister observed a test of the commu- 
nications link between the Nuclear Risk 
Reduction Centers established under 
the Nuclear Risk Reduction Center 
Agreement signed on September 15, 
1987. 

The sides held extensive talks on 
regional questions. They reaffirmed 
that the goal of the U.S. -Soviet re- 
gional dialogue should be to help the 
parties to regional conflicts find peace- 
ful solutions that advance their inde- 
pendence, freedom, and security, and 
within this context, reviewed the situa- 
tion regarding Afghanistan, Central 



America, Iran-Iraq, the Middle East, 
southern Africa, Cambodia, and the 
Korean Peninsula. Contacts and con- 
sultations on these issues will continue. 

The two sides examined the work 
underway to expand areas of bilateral 
cooperation between the United States 
and the Soviet Union. 

To continue their discussions on the 
wide spectrum of issues in U.S. -Soviet 
relations and to ensure successful prep- 
arations for the Moscow summit. Secre- 
tary Shultz and Foreign Minister 
Shevardnadze agreed to meet again in 
Moscow from April 21 to 25, 1988, and 
then again in the middle of May. ■ 



Chancellor Kohl Meets 
With President Reagan 




Chancellor Helmut Kohl of the 
Federal Republic of Germany made an 
official working visit to Washington, 
D.C., February 17-19, 1988, to meet 
with President Reagan and other gov- 
ernment officials. 

Following are remarks ynade by the 
President and the Chancellor after 
their meeting on February 19 A 



President Reagan 

It has been a very great pleasure to 
meet with Chancellor Kohl again for a 
friendly and highly useful discussion. 

This year marks the 40th anniver- 
sary of a series of events that have 
shaped the destiny of our two coun- 
tries. In 1948 the United States 
stepped forward and helped spark the 
postwar recovery of West Germany and 
Europe and assisted in starting the 
constitutional process that created a 



ill a 



to 



West German state. In response to S 
viet challenges, we launched the Ber 
airlift and aided in laying the founda|(i«i 
tion for collective security and the ec 
nomic integration of Western Europe 
It was in this crucible of events that 
the modern relationship between the 
Federal Republic of Germany and th« 
United States was forged, a rela- 
tionship that has prospered and man; 
times proven its value to both our 
countries. 

As befits good friends, the Chan 
cellor and I have met regularly since 
we assumed office. Our discussions re 
fleet the richness of our relationship irs 
and the many interests we share. I e; id 
pecially benefit from hearing the Cha 
cellor's views on world problems. 

Among the many subjects we dis 
cussed today was the state of the 
NATO alliance, including our common 
defense efforts and arms control strat 
egy. I thanked the Chancellor for his 
support throughout the long INF 
[intermediate-range nuclear forces] n( 
gotiations and now for the treaty itsel 
This treaty represents a major politic; 
victory for NATO, a success far beyon 
what many thought possible. It carrie 
important lessons on how successfully 
to negotiate arms reductions with the 
Soviet Union. 

We also reviewed progress on the 
NATO alliance's next arms control pri L 
orities. These include negotiations to- n 
ward a 50% reduction in strategic arm 
a verifiable global ban on chemical 
weapons, and redressing the serious 
imbalances in conventional forces in 
Europe. 

We agreed that we must deal with 
the Soviet Union from a position of re- 
alism, strength, and alliance unity. An 
we agreed that the alliance must main- 
tain both military strength and read- 
iness. These are the underpinnings am 
preconditions of any successful dialogu 
with the Soviet Union. Only a strong 
West can have a positive influence on 
the way in which the Soviet Union 
deals with other countries and with its 
own people; we know that a weak West 
ern alliance cannot. The NATO summit 
meeting early next month will provide 
an opportunity to continue discussion o: 
these important matters within the al- | 



a 



Uance as a whole. 

The Chancellor and I also discussec 
economic and trade issues. In particu 
lar, I told the Chancellor that I sup- 
ported the efforts he has made to 
stimulate the West German economy, 



44 



Department of State Bulletin' 



EUROPE 



I expressed the hope that he would 
nore. The Chancellor, in turn, wel- 
led our efforts to reduce the U.S. 
ral deficit. We both agreed on the 
d to avoid trade protectionism. Pro- 
ionism would be an economic disas- 
for both our countries. 
In the course of our discussions, we 
touched on a subject close to both 
hearts: the city of Berlin and its 
ve people. We both agreed that they 
t be included in whatever benefits 
roved East- West relations may 
ig. We look forward to a positive 
jonse to the invitation the Western 
ers extended last December to the 
iet Union to join with us in taking 
)s to improve the lives of Berhners. 
The Chancellor's visits to Wash- 
on are always welcome. We will be 
ng each other again soon at the 
rO summit in Brussels. And until 
1, we do not say goodbye but 
■viedersken [until we meet again]. 

incellor Kohl^ 

visit to Washington — and this is my 
h bilateral meeting with President 
gan — is by all a return visit to the 
norable visit the President paid to 
lin and Bonn last June. 
The Berlin initiative announced by 
was one of the points on which we 
ised in our conversation. I once 
in expressed my appreciation and 
;itude to President Reagan for this 
iative, and I assured him that the 
eral Republic and the Federal Gov- 
ment will do all it can in order to 
ie its contribution toward the suc- 
i of this initiative. 
In the meantime, the three West- 
protective powers have entered into 
:s with the Soviet Union on this is- 
, and the President assured me that 
retary of State Shultz, on the occa- 
1 of his forthcoming visit to Moscow, 
. make it plain to his Soviet inter- 
itors that Berlin must be included 
n the very beginning in positive de- 
)pments of West-East relations. 
I might take this opportunity to 
iress my appreciation for [your] hav- 
issued a proclamation declaring the 
of October 1987 German-American 
!. And I may request you to make 
> a permanent feature. 
We had intensive exchanges on the 
sent state of West-East relations, 
rer in the postwar history has the 
ited States of America and the So- 
t Union been engaged in such an 
msive dialogue at the highest level 



as in the last few years. And with the 
INF agreement, the third summit 
meeting between you and General Sec- 
retary Gorbachev has, for the first time 
in history, opened the way toward gen- 
uine disarmament. And I have seized 
this opportunity, once again, to express 
my congratulations to the President on 
this success — the success which will be 
your success and which will always be 
linked with your presidency. 

The INF agreement is in the inter- 
est of the United States of America; it 
is in the interest of the Atlantic al- 
liance; and it is, not least, also in the 
interest of our own country. 

Nobody who has objections as far 
as this agreement is concerned, be it 
here in Washington or somewhere else 
in the United States, can point to the 
Federal Republic of Germany. And that 
is the reason why yesterday, when I 
had talks and meetings with the lead- 
ership of the Senate, I pleaded in no 
uncertain terms in favor of the ratifica- 
tion of this agreement without any re- 
stricting amendments. 

You referred to the present nego- 
tiations concerning START [strategic 
arms reduction talks]. The Government 
of the Federal Republic of Germany 
vigorously supports a 50% cut in the 
strategic offensive potential of either 
power, because this step is not only in 
the interest of the United States of 
America but it would also be in the 
very real interest of the Federal Re- 
public of Germany and of Western 
Europe. 

We staunchly support a worldwide 
ban on chemical weapons, and we sup- 
port the early adoption of a mandate 
for negotiations on conventional sta- 
bility in the whole of Europe, from the 
Atlantic to the Urals. 

In accordance with the decisions 
taken by the alliance in Reykjavik and 
in Brussels, I have supported the posi- 
tion that, in conjunction with the estab- 
lishment of a conventional balance and 
the global elimination of chemical weap- 
ons, tangible and verifiable reductions 
of nuclear systems of shorter range 
should also be reached, the objective 
being equal ceilings, no zero resolution, 
no denuclearized zone — and least of all, 
in Europe. 

We are in agreement that all these 
disarmament questions and issues, as 
well as the necessary measures to pre- 
serve our common security, should be 
combined and form an overall concept 
for our aUiance. And we think that the 
forthcoming NATO summit meeting 
must be an incentive for that and give 
new impulses to that effort. 



We have agreed that we will re- 
main in bilateral contact as far as all 
these issues are concerned. And along 
this line— and the President and I were 
in complete agreement on that — trust 
and confidence between West and East 
must be further developed and inten- 
sified, and this would also include the 
solution of regional conflicts as well as 
ensuring respect for human rights, par- 
ticularly so in the countries of the War- 
saw Pact. 

You have just made the same point, 
and we are all in agreement that we 
will be able to face up to the talks 
ahead of us. And this new phase can be 
mastered only when we show unity, co- 
herence, and the closest measure of co- 
ordination and consultation. 

I would like to take this opportu- 
nity here to express, as Chancellor of 
the Federal Republic of Germany, be- 
fore the American public that we are 
fully aware of the fact that the Federal 
Republic of Germany knows that only 
together, with their allies and only to- 
gether with the support of all the free 
nations of Western Europe and the 
United States of America, will it be 
possible to attain its legitimate aim of 
easing, in the interest of the people, 
the consequences of the division of our 
country and to make the frontier be- 
tween East and West more permeable. 
We are belonging to the West, and that 
is the way it will be also in the future. 

I came here not only in my capac- 
ity as Chancellor of the Federal Re- 
public of Germany but also as the 
Chairman and the President of the Eu- 
ropean Community. I was able to re- 
port to you about the successful 
conclusion of this summit meeting — the 
European Community — we had a week 
ago in Brussels and the measures we 
agreed upon there, particularly the re- 
striction in the limitation of agricultural 
production and our commitment to the 
maintenance and to the support of the 
common policy favoring continued free 
trade all over the world — were some of 
the main positions we have taken there. 
And I also assured you that we will 
certainly not adopt a tax on oils and 
fats. 

It has been a reassuring experience 
in all the visits I paid to you here in 
the White House, that as far as our 
commercial relations — transatlantic 
commercial and economic relations — are 
concerned, we have always renewed our 
commitment to the concept of a free 
trade and to rejection of protectionism; 
that this is part of the spirit in which 
we are facing these talks and in which 
we will be able to live up to the tasks of 
the future. 



y 1988 



45 



EUROPE 



Once again, I thank you very much 
for the extremely friendly atmosphere 
for our exchanges and for the support I 
have been receiving from you, from the 
members of your Cabinet, and the 
members of your staff These have been 
2 short days I spent here in Wash- 
ington, but I think these were 2 good 
days. And I think it is this spirit in 
which we will go on working also in the 
future together. 

President Reagan 

Your suggestion during your last visit 
for a U.S. -German Youth Exchange 
Council has resulted in the recent es- 
tablishment of a body of prominent 
Americans and Germans who have ac- 
cepted the challenge to expand youth 
exchanges between our two countries. I 
fully support the work of this youth ex- 
change council and share your strong 
personal commitment to advancing mu- 
tual understanding, particularly be- 
tween the younger generations in our 
two countries. I am, therefore, espe- 
cially pleased to be able today to ex- 
change with you, in the presence of 
Director [of the U.S. Information 
Agency Charles Z.] Wick and Professor 
Weidenfeld [Werner Weidenfeld, Coor- 
dinator of German-American Coopera- 
tion], the two coordinators of U.S.- 
German cooperation, copies of the docu- 
ments estabhshing the U.S. -German 
Youth Exchange Council. 

Chancellor Kohl 

I think what we have just done is more 
important than anything else we could 
have possibly done. We discussed the 
issues, the great international issues, 
but what we have done here concerns 
the future. It relates to the next gener- 
ations, and I think they will form their 
opinion and their judgment about what 
we have done by measuring us against 
this background. And I think they will 
enable us to live up and to stand up to 
that measurement if we will be able to 
go on along this line. 



'Made in the East Room of the White 
House {text from Weekly Compilation of 
Presidential Documents of Feb. 22, 1988). 

2Cha„(.giiQ^ j^pjj] gpgj^g i^ German, and 
his remarks were translated by an inter- 
preter. ■ 



Lithuanian Independence Day, 1988 



PROCLAMATION 5772, 
FEB. 11. 19881 

Seventy years ago, on February 16, 1918, 
the Lithuanian National Council declared 
the independence of Lithuania and estab- 
lished the Republic of Lithuania. This res- 
toration of Lithuania's sovereignty was 
recognized around the world — even by the 
Soviet Union, in 1920. Lithuania joined the 
League of Nations in 1921, and for the next 
two decades Lithuanians enjoyed liberty 
and self-determination under a government 
that fostered political and religious free- 
dom for all citizens. 

Then, in June 1940, the year after the 
signing of the Molotov-Ribbentrop Pact, 
the Soviet Union invaded and illegally oc- 
cupied Lithuania and the other Baltic 
States. The United States unequivocally 
condemned this violation of national sov- 
ereignty and national integrity, and ever 
since then our policy has remained consist- 
ent. We have never recognized the forcible 
incorporation of Lithuania into the Soviet 
Union, and we never will. 

Observance of the anniversary of 
Lithuania's Declaration of Independence is 
natural for Americans, who faithfully cele- 
brate our own Independence Day each 
year America has long been a beacon of 
hope to Lithuania, because Americans 
cherish their self-determination, individual 
liberty, and independence— the God-given 
rights the Lithuanian people seek to re- 
claim in the face of religious and political 
persecution, forced Russification, and eth- 
nic dilution. It is therefore fitting to show 
our solidarity with the people of Lithuania. 

We join in Lithuania's proud and sol- 
emn remembrance of the 70th anniversary 
of its independence, and together with peo- 
ple the world over we share the spirit and 



the hope of the Lithuanian people as th( 
commemorate that day. Among the Lith 
nian people the spirit of liberty remains 
unbroken — the spirit of a true leader of 
people, Nijole Sadunaite, whose sacrific 
for country and conscience continue so ( 
rageously to the present day, and who 
wrote from the Gulag, "Our brief days o 
earth are not meant for rest, but to par 
cipate in the struggle for the happiness 
numerous hearts;" the spirit of the free- 
dom marchers of Vilnius, Lithuania's caj 
ital, and of Kaunas; the spirit of every t 
and place where bold sons and daughter 
remember their heritage and their highi 
ideals. 

To demonstrate our common commit 
ment to the cause of freedom, the Con- 
gress, by Senate Joint Resolution 39, ha 
designated February 16, 1988, as 
"Lithuanian Independence Day" and has 
authorized and requested the President 
issue a proclamation in observance of thi 
day. 

Now, THEREFORE, I, RoNALD ReAG 

AN, President of the United States of 
America, do hereby proclaim February 1 
1988, as Lithuanian Independence Day. 1 
call upon the people of the United States 
to observe this day with appropriate cer 
monies and activities in reaffirmation of 
their devotion to the just aspirations of; 
peoples for self-determination and libert 
In witness whereof, I have hereu: 
set my hand this 11th day of February, ir 
the year of our Lord nineteen hundred a 
eighty-eight, and of the Independence of 
the United States of America the two hu 
dred and twelfth. 

Ronald Reaga 



'Text from Weekly Compilation of 
Presidential Documents of Feb. 15, 1988. 



46 



Department of State Bulletii<| 



EUROPE 



sit of Portuguese Prime Minister 




Prime Minister Anibal Cavaco 
va of the Republic of Portugal made 

official working visit to Washington, 
C, February 23-25, 1988, to meet 
th President Reagan and other gov- 
anient officials. 

Following are remarks made by 
esident Reagan and Prime Miyiister 
,vaco Siiva after their meeting on 
bruary 2iA 

esident Reagan 

has been a pleasure and an honor for 
; to meet today with Prime Minister 
.vaco Silva on his first official visit to 
ishington. Portugal is a founding 
imber of the North Atlantic Treaty 
ganization, a valuable friend, and an 

y- 

We salute Portugal's impressive 
insition to democracy and its continu- 
l commitment to the collective de- 
ise of the West. Beyond the shared 
lues and common interests that link 
r two countries, the Portuguese- 
nerican community has made a last- 
l contribution to American society 
It we can all appreciate. 

Mr. Prime Minister, you and I have 
3t concluded a most useful discussion 
rering a broad range of international, 
well as bilateral, issues of impor- 
fice. Southern Africa, the Middle 
ist, and Afghanistan were among the 
pics we covered today, and I am 
ateful for your advice and counsel. 



High also on our list of topics was 
the agenda for the NATO summit, 
where we will meet again next week. I 
listened intently to the Prime Minister's 
views on East- West issues. I brought 
him up-to-date on recent developments 
in U.S. -Soviet relations and our plans 
for the Moscow summit. Secretary 
Shultz discussed his meeting with So- 
viet Foreign Minister Shevardnadze. 
Prime Minister Cavaco Silva briefed us 
on Portugal's assessment of the recent 
European Community summit in 
Brussels and the current political and 
economic situation in Portugal. 

As our meeting today under- 
scored — while trying to improve rela- 
tions with adversaries — America still 
remains strong and unflinching in its 
commitments to our friends. The core 
of our foreign policy is our permanent 
partnership with our fellow democ- 
racies in the Atlantic alliance, on which 
the global balance of power and the 
cause of freedom so crucially depend. 
Be assured we will never sacrifice the 
interests of our allies and friends in any 
agreement with the Soviet Union. 

The people of the United States 
and the people of Portugal are united 
with all other free peoples in the cause 
of freedom and the responsibility of 
maintaining the peace. The United 
States and Portugal are doing their 
part in this historic adventure. We are 
honored to have such friends. 



These are challenging times. From 
our cordial and candid conversation, I 
know that we share similar goals and 
many of the same concerns. Portugal's 
role as a key and trusted ally is much 
appreciated here. We applaud Portugal's 
desire to modernize its armed forces 
and to play a more active role in 
NATO's collective defense efforts. Our 
commitment to assist Portugal in these 
efforts remains firm, even within the 
context of the harsh budget realities 
that we all face. The task of leadership 
is to rise to that challenge. 

I believe from our meeting today, 
^ our two governments will accelerate the 
t pace of our extensive cooperation and 
^ develop even further the close and mu- 
£ tually beneficial relationship, which has 
5 traditionally existed between our two 
> countries. 

Z Prime Minister Cavaco Silva^ 

I This morning we had the opportunity to 
I have a useful exchange of ideas on the 
I strengthening of the Atlantic alliance in 
a perspective of peace and security for 
the Western world, on the relations be- 
tween our two countries, and, finally, 
on the international situation. Por- 
tugal's and the U.S. positions converge 
toward the need for firmness and cohe- 
sion in the Western world. 

I reiterated to President Reagan 
the Portuguese Government's support 
of the INF [intermediate-range nuclear 
forces] agreement and the continuation 
of the dialogue with the Soviet Union. I 
expressed my firm belief that Western 
Europe's defense is not feasible without 
the U.S. commitment in the framework 
of NATO. I am sure that, at the next 
NATO summit meeting which will be 
held in a few days, we will have the 
opportunity to restate our common de- 
termination to strengthen the Atlantic 
alliance as a requisite for the preserva- 
tion of peace and our common values. I 
informed President Reagan of the con- 
clusions of the last European Council 
and the prospects for building a united 
Europe and for Portugal's development 
and modernization. 

In the context of Portugal-U.S.A. 
relations, I reasserted our desire to 
maintain a preferential relationship 
since Portugal, being the U.S. mar- 
itime frontier with Europe, is a strate- 
gically important ally and wishes to 
remain a close and reliable ally. 

A few differences have emerged re- 
garding the agreement signed between 
our two countries in 1983, in the con- 
text of the defense agreement, which 



jy 1988 



47 



EUROPE 



has bound us since 1951; namely, the 
legitimate Portuguese expectations re- 
garding assistance levels granted to 
Portugal by the United States. We ap- 
proach this subject within the spirit of 
openness that should guide relations 
between friends and allies. I stressed 
the difficulties that will result for Por- 
tugal if that assistance were curtailed, 
particularly at a time when we are com- 
mitted to the reequipment of our armed 
forces and trying to modernize the 
country in an effort that cannot be de- 
ferred. I stated to President Reagan 
that the Portuguese Government 
intended to request that consultations 
be held in deterrence of the agreement. 
In holding these consultations, we 
do not have the intention of ceasing or 
reducing the facilities enjoyed by the 
United States in Portuguese territory 
but rather to identify and overcome ex- 
isting difficulties. As friends and allies, 
we want to look for solutions that will 
meet our common interests, so as to 
ensure a framework of cooperation to 



Republic of Portugal 



GEOGRAPHY 

Portugal is made up of the mainland 
and the Azores and Madeira Islands. 
Mainland Portugal is divided into two 
distinct topographical and climatic re- 
gions by the Tkgus River, which flows 
into the Atlantic at Lisbon. North of 
the Tkgus, Portugal is mountainous, 
with a rainy, moderately cool climate; 
the south has rolling plains, less rain- 
fall, and a warm climate, particularly in 
the interior. 

The Azores consist of nine rugged, 
mountainous islands (2,300 sq. km. — 
888 sq. mi.) of volcanic origin lying 
1,300 kilometers (about 800 mi.") west of 
Lisbon. Their climate is moist and mod- 
erate. The regional capital is Ponta Del- 
gada (pop. 35,000) on Sao Miguel 
Island. 

The Madeira Islands, located about 
560 kilometers (350 mi.) west of Mo- 
rocco, are more rugged than the 
Azores. The archipelago consists of two 
main islands and many uninhabited is- 
lets (790 sq. km.— 305 sq. mi.). Mild 
year-round temperatures attract many 
tourists. 



strengthen the preferential relations 
that exist between our two countries. 

When we analyzed the interna- 
tional situation, we gave special rele- 
vance to the situation in southern 
Africa, a region where Portugal has 
important responsibilities to fulfill. I 
am gratified by the ongoing talks be- 
tween the U.S. and the Angolan Gov- 
ernments — which are a positive step in 
the peace process — and by the support 
provided to Mozambique. 

I wish to express my appreciation 
for the opportunity to meet with you on 
this occasion which, I am sure, has con- 
tributed to strengthen the relations be- 
tween our two countries, as well as the 
Atlantic alliance's cohesion. 



'Made on the South Portico of the 
White House (text from Weekly Compila- 
tion of Presidential Documents of Feb. 29, 
1988). 

-Prime Minister Cavaco Silva spoke in 
Portuguese, and his remarks were trans- 
lated by an interpreter. ■ 



Portugal's dependency of Macau, on 
the southern coast of China, is an au- 
tonomous entity under Portuguese ad- 
ministration. In April 1987, Portugal 
and China signed an accord to return 
Macau to Chinese administration in 
1999. The former overseas territory of 
Goa, on the west coast of the Indian 
subcontinent, was annexed by India in 
December 1961. The former colony of 
Portuguese Timor, the eastern half of 
Timor Island in the Indian Ocean north 
of Australia, was annexed by Indonesia 
in July 1976. Portugal's former overseas 
territories in Africa — including Angola, 
the Cape Verde Islands, Guinea-Bissau, 
Mozambique, and Sao Tome and Prin- 
cipe — achieved independence between 
September 1974 and November 1975. 



PEOPLE 

Portugal's earliest recorded inhabitants, 
members of an Ibero-Celtic tribe known 
to Imperial Rome as the Liisita)ii and 
first mentioned in the second century 
B.C., have mixed with Germanic, Cel- 
tic, Roman, Arabic, and African peo- 
ples to form today's relatively 



homogeneous Portuguese population, 
Portuguese citizens of black African c i'' 
scent, who emigrated to Portugal afU i'"'' 
decolonization of Portugal's African t€ '"'■ 
ritories, make up the country's only s "■* 
nificant and distinct minority group b ft''' 
probably number fewer than 100,000 



Portuguese Culture 



dtti 



■\p< 



Luis Vaz de Camoes (1524-80) is the 
most famous poet to have written in 
Portuguese and is a Portuguese na- 
tional hero. His best-known work is 
The Lusiads, an epic poem in 10 cantosijw 
about the discovery by Vasco da Gamii 
of the sea route to India in 1497-98. 

The Portuguese concept of 
aaudade. or nostalgia mixed with a 
melancholy acceptance of fate, finds it 
clearest expression in the songs oi fad' 
encountered most often in the restau- 
rants of Lisbon's older districts, such i 
the Alfama. 

Portugal is noted for an abundanc 
of ancient and medieval monuments an- 
buildings, including: 

• Pena and Sintra palaces; 

• The ex-royal residence of Queluz 

• The walled city of Obidos; 

• The cathedrals at Batalha and 
Alcobaca; 

• The castle of Sao Jorge in Lisbor 

• Roman temple ruins in Evora; an 

• The castle of Afonso Henriques ii 
Guimaraes, near Oporto, from which 
the Portuguese nation was founded. 



a 



HISTORY 

Portugal is one of the oldest states 
in Europe, tracing its modern history 
to A.D. 1140 when, following a 9-year 
rebellion against the King of Leon- 
Castile, Afonso Henriques, the Count 
of Portugal, became the country's first 
king, Afonso I. Afonso and his suc- 
cessors expanded their territory south' 
ward, capturing Lisbon from the Moors 
in 1147. The approximate present-day 
boundaries were secured in 1249 by 
Afonso III. 

By 1337, Portuguese explorers had 
reached the Canary Islands. Under the 
inspiration of Prince Henry the Navi- 
gator (1394-1460), explorers such as 
Vasco da Gama, Bartolomeu Dias, and 
Pedro Alvares Cabral roamed the globe 
from Brazil to India and Japan. Por- 
tugal eventually became a massive co- 
lonial empire with territories in Africa 
and Latin America (Brazil) and out- 
posts in the Far East (East Timor, 
Macau, Goa). 



48 



Department of State Bulletin] 



EUROPE 



Dynastic disputes led in 1580 to 
■ succession of Philip II of Spain to 

Portuguese throne. A revolt ended 
jnish hegemony in 1640. and the 
use of Braganca was established as 
•tugal's ruling family. Their mon- 
hy lasted until the establishment of 

Portuguese Republic in 1910. 

During the ne.xt 16 years, intense 
itical rivalries and economic in- 
bility undermined newly established 
Tiocratic institutions. To answer 
ssing economic difficulties, a mili- 
y government, which had taken 
ver in 1926, turned for guidance to 
rominent university economist. Dr. 
tonio Salazar Dr. Salazar, named fi- 
ice minister in 1928, became prime 
lister in 1932. For the next 42 years, 
and his successor, Marcelo Caetano, 
pointed prime minister in 1968, ruled 
[■•tugal as an authoritarian "corporate" 
ite. Unlike most other European 
mtries, Portugal did not play a com- 
ant role in World War II. It was a 
irter member of NATO, joining in 

:9. 

In the early 1960s, wars with in- 
pendence movements in Portugal's 
•rican territories began to di-ain labor 
d wealth from Portugal. Professional 
;satisfaction within the military, cou- 
'd with a growing sense of the futility 
the African conflicts, led to the for- 
ition of the clandestine "Armed 
rces Movement" in 1973. 

The downfall of the Portuguese 
rporate state came on April 25, 1974, 
len the Armed Forces Movement 
ized power in a nearly bloodless coup 
d established a provisional military 
vernment. 

Gen. Antonio de Spinola was in- 
lUed as president after the coup but 
signed in September 1974 to protest 
e growing power exercised by com- 
inist and leftist forces. He was re- 
iced by another general, Francisco 
Costa Gomes, who retained a pro- 
mmunist. Gen. Vasco dos Santos Gon- 
Ives, as prime minister. On March 11, 
75, a rebellion by rightist military of- 
ers failed, and former President 
linola fled the country. 

On April 25 (now Portugal's na- 
inal day), the first anniversary of the 
74 coup, Portuguese voters chose a 
)nstituent Assembly to draft a con- 
itution. The vote gave an overwhelm- 
g majority of 127c to candidates of 
ree democratic political parties: the 
icialists (PS), Popular Democrats 
hich later changed its name to Social 
jmocrats — PSD), and Center Social 
jmocrats (CDS). 



Portugal 




The communists and their allies in 
the Armed Forces Movement attempted 
to play down their relative lack of popu- 
lar support (the Communist Party won 
only 12.5% of the vote) by tightening 
their hold on the provisional govern- 
ment and by seeking to diminish 
sharply the role of political parties. 

Goncalves resigned under mounting 
civilian and military pressure, and a 
new provisional government (the sixth 
since April 1974) took office in Sep- 
tember 1975, led by Adm. Jose Pinheiro 
de Azevedo. 

The political tug-of-war continued 
until November 25, when left-wing mil- 
itary elements seized conti'ol of several 
strategic military bases, only to sur- 
render peacefully the next day after a 
determined show of force by loyal units 



under the direction of Lt. Col. Antonio 
Ramalho Eanes. 

Portugal's new constitution took ef- 
fect on April 25, 1976, when elections 
for a parliamentary Assembly of the 
Republic also were held. In June, 
Eanes was elected president with 62% 
of the vote after gaining the support of 
the three major democratic parties. He 
chose Mario Soares, whose Socialist 
Party had won a plurality in the parlia- 
mentary elections, to serve as prime 
minister of Portugal's first democratic 
government since the 1920s. 

Soares' minority socialist govern- 
ment fell in December 1977 and was 
followed by a succession of short-lived 
coalition and minority governments un- 
til the parliamentary elections of July 
19, 1987, when PSD' leader Cavaco Silva 



ay 1988 



49 



EUROPE 



led his party to a stunning victory, re- 
sulting in the first absolute majority for 
a single party. The PSD received a 
slight majority (just over 50%) of the 
popular vote but won 148 of the 250 
seats in parliament (see table). The PS 
rose slightly to 22'^ and 60 seats, while 
the CDS fell to 4% and 4 seats (below 
the 5 seats necessary to participate in 
parliament as an organized group), and 
the PRD plummeted from 18% to S^f 
with only 7 seats. The communists, 
running as the new Unitary Democratic 
Coalition (CDU), dropped to an all-time 
low of 12%' and 31 seats. Mario Soares, 
who had been elected president in Feb- 
ruary 1986, consequently invited Prime 
Minister Cavaco Silva to form a govern- 
ment, the first that appeared likely to 
complete its 4-year term since the 1974 
revolution. 



GOVERNMENT 

The April 2, 1976, constitution defines 
Portugal as a "republic... engaged in 
the formation of a classless society." 
Modeled on the Napoleonic Code, the 
lengthy and detailed document provides 
strong safeguards for individual civil 
liberties. After a long debate, the 1976 
constitution was revised in 1982. The 
revision implemented significant 
changes in the political system. The 
military was placed under strict civilian 
control, the Revolutionai\y Council (a 
nonelected political watchdog commit- 
tee with legislative veto powers) was 
abolished, and the powers of the presi- 
dent were trimmed. In addition, most 
of the Marxist rhetoric of the original 
document was excised, signaling a re- 
turn to greater free enterprise in the 
economy. 

The four main organs of national 
government are the presidency, the 
prime minister and Council of Ministers 
(the government), the Assembly of the 
Republic (parliament), and the courts. 

The president, elected to a 5-year 
term by direct, universal suffrage, is 
also commander in chief of the armed 
forces. Presidential powers include ap- 
pointing the prime minister and Council 
of Ministers (in which the president 
must be guided by the Assembly elec- 
tion results), dismissal of the prime 
minister, dissolution of the Assembly in 
order to call early elections, veto over 
legislation (which may be overridden by 
the Assembly), and the declaration of 
states of war or siege. 



The president is assisted by an ad- 
visory body, the Council of State, which 
comprises incumbents of six senior ci- 
vilian offices, any former presidents 
elected under the 1976 constitution, five 
members chosen by the Assembly, and 
five chosen by the president himself. 

The government is headed by the 
presidentially appointed prime minister, 
who names the Council of Ministers 
subject to presidential approval. A new 
government is required to define the 
broad outlines of its policy in a program 
and present it to the Assembly for a 
mandatory period of debate. Failure of 
the Assembly to reject the program by 
a majority of deputies confirms the gov- 
ernment in office. 

The Assembly of the Republic is a 
unicamei'al body, composed of 250 depu- 
ties elected by direct universal suffrage 
according to a system of proportional 
representation. The term of office for 
deputies is 4 years, unless the presi- 
dent dissolves the Assembly and calls 
for new elections. 

The constitution pi-ovides for dis- 
trict and appeals courts, with the na- 
tional Supreme Court designated as the 
court of last instance. Military, admin- 
istrative, and fiscal courts are desig- 
nated as separate court categories. The 
constitution also provides for a nine- 
member Constitutional Ti-ibunal to re- 
view the constitutionality of legislation. 

The constitution gives substantial 
autonomy to the locally elected govern- 
ments of the Azores and Madeira Is- 
lands. A regional autonomy statute for 
the Azores, establishing the Govern- 
ment of the Autonomous Region of the 
Azores, was promulgated July 25, 1980, 
and amended in 1987. The Government 
of the Autonomous Region of Madeira 
operates under a provisional autonomy 
statute in effect since 1976. 

Finally, the constitution provides 
for the progressive decenti'alization of 
administration, calling for future re- 
organization on a regional basis. Apart 
from the Azores and Madeira, the coun- 



Assembly of the Republic 
July 1987 Election Results 



Party 

PSD 
CDS 

PS 

PCP/CDU 

PRD 



% Votes Seats 



,51.1 


14« 


4.4 


4 


22.2 


60 


12. « 


31 


4.9 


7 



try is currently divided into 18 dis 
tricts, each headed by a governor ap.! ^| 
pointed by the Minister of Internal 
Administration. 



)ti« 



)pei 



tot 



Principal Government Officials 

President of the Portuguese Republic 

Mario Soares 
Prime Minister — Anibal Cavaco Silva 

Ministers 

Deputy Prime Minister and Defense 

Minister — Eurico de Melo 
Minister of Foreign Affairs — Joao de 

Deus Pinheiro 
Minister of Interior — Jose Silveira 

Godinho 
Minister of Justice and of the 

Presidency of the Council of 

State — Fernando Nogueira 
Minister of Finance — Miguel Ribeiro 

Cadilhe 

Armed Forces 

Chief of Staff of the Armed Forces — 
Gen. Jose Lemos Ferreira 1. 

Service Chiefs of Staff^Gen. Jorge d: 
Costa Salazar Braga (army), Adm 
Antonio Egidio Sousa Leitao 
(navy), and Gen. Jorge Manuel Br 
chado de Miranda (air force) 

Ambassador to the United States — .Jn; 
Bastos 

Portugal maintains an embassy in 
the United States at 2125 Kalorama 
Road NW., Washington, D.C. 20008 
(tel. 202-328-8610); consulates general 
in New York City, Boston, and San 
Francisco; consulates in Providence, 
R.I.; Newark, N.J.; and New Bedford, 
Mass.; and honorary consulates in Hon 
olulu, Los Angeles, Houston, New Or- 
leans, Chicago, Philadelphia, Miami, 
and Waterbury, Conn. The Portuguese 
National Tourist Office in the United 
States is located at 548 Fifth 
Avenue, New York, NY 10036 
(tel: 212-354-4403). 



ECONOMY 

After nearly a decade of rapid growth, 
Portugal's economy declined in the 
mid-1970s due to disruptions after the 
1974 revolution and the large influx 
of refugees from Portugal's former co- 
lonies in Africa. This period was 
characterized by chronic balance-of- 
payments deficits, followed by an In- 
ternational Monetary Fund (IMF)- 
supported stabilization plan. Growth re 
sumed in the late 1970s, but structural 



50 



EUROPE 



jiblcms and a frequently adverse in- 
iiaimnal economic environment have 
tati.l a "stop-and-go" pattern in 
ler tn keep balance-of-payments def- 
is under control. The current eco- 
iiiic recovery started in mid-1985 
I vr - >'ears of recession. 

Since 1960, the proportion of the 
; 111- tnrce engaged in agriculture has 
lipped from 42% to 21.6'7f. Agri- 
tural production contributes only 
I' I (if the country's gi'oss domestic 
iichkt (GDP), and the country im- 
I't.-' a substantial share of its food as 
ill as feed for its animals. The agrar- 
: lel'iii-m program, implemented in 
■ siiuth during 1975, resulted in the 
iiiiiation of many large, privately 
■ ned estates formerly characteristic of 
lit region, but a 1977 law has led to 
!• return of portions of nationalized 
iperties to previous owners and the 
tribution of other portions among in- 
idual tenant farmers. 

Industrial employment has risen 
m 219f to :34.6'7f of the labor force 
ce 1960. Industry contributes 31.6% 
:he GDP. Major products are tex- 
'S, clothing, cork products, electronic 
aipment, machinery, steel, woodpulp 
1 paper, cement, tomato paste, 
ined seafood, olive oil, assembled 
omobiles, refined petroleum, and 
■mical products. Portugal also has 
ge shipbuilding and repair yards. 

The volume of foreign trade in- 
cased from $873 million in 1960 to 
i billion in 1986, with imports total- 
; $8.8 billion and e.xports $7.2 billion, 
rtugal's main trading partners are 
■stern Europe and the United States. 

Portugal's foreign trade deficit has 
ditionally been covered by remit- 
ices from Portuguese workers abroad 
i by earnings from tourism. The 
rid recession in the early 1980s, 
ich caused those remittances and 
•nings to decline, coupled with high 
prices, adverse e.xchange rate rela- 
nships, and e.xpansionary domestic 
;al and monetary policies led again 
ring 1980-82 to a deterioration in 
"tugal's external accounts. In 1982, 
! balance-of-payments deficit reached 
3 billion, and in 1983, Portugal had 
sell $1 billion from its sizable gold 
erves. 

The government that took office in 
le 1983 moved rapidly to implement 
eries of short-term corrective meas- 
!S and to negotiate an 18-month 
ndby agreement with the IMP' 
used on holding down the growth of 
nestic credit and foreign indebted- 



Portugai — A Profile 



Geography 

Area: 94,276 sq. km. (36,390 sq. mi.), in- 
cluding the Azores and Madeira Islands; 
about the size of Indiana. Cities: Capital— 
Lisbon (pop. 2 million in the metropolitan 
district). 0?/;pr— Oporto (1.56 million in 
metropolitan district). Terrain: Mountain- 
ous in the north: rolling in central south. 
Climate: Maritime temperate. 

People 

Nationality: Nonn and adjective — 
Portuguese (sing, and pi.). Population 
(1986): 9.74 million. Annual growth rate 
(1986): 4.0%. Ethnic groups: Homogeneous 
Mediterranean stock with small black Af- 
rican minority. Religion: Roman Catholic 
977f. Language: Portuguese. Education: 
Years ciiwpiilsory — 6. Attendance — 607f. 
Literacy (1985)— 83.3%. Health: Infant 
mortality rate (1985)— 17.8/1,000. Life 
expectancy (1985)— 73 yrs. Work force 
(4.5 million. 1986): Agriculture— 21.6%. 
Industry — 34.6%'. Government, commerce, 
and service.'^ — 43.8%. 

Government 

Type: Parliamentary democracy. 
Constitution: Entered into effect April 25, 
1976: revised October 30, 1982. 

Branches: Executive— president 
(chief of state). Council of State (presiden- 
tial advisory body), prime minister (head 
of government). Council of Ministers. 
Legislative — unicameral Assembly of the 
Republic (250 deputies). Judicial — 
Supreme Court, district courts, appeals 
courts. Constitutional Tribunal. 

Major political parties: Center Social 
Democratic Party (CDS), Portuguese Com- 
munist Party (PCP), Social Democratic 
Party (PSD), Socialist Party (PS), Demo- 
cratic Renewal Party (PRD). Suffrage: 
Universal over 18. 

Subdivisions: 18 districts, 2 autono- 
mous regions, and 1 dependency. 



Central government budget (1987): 
.$11.3 billion (expenditures). 

Defense (1987): 2.9% of GDR 
Flag: A vertically divided field — 
one-third green along the staff two-thirds 
red; centered on the dividing line is the 
Portuguese coat of arms encircled in gold. 

Economy 

GDP (1986): $28.9 billion. Annual growth 
rate (1986): 4.0%. Per capita income 
(1986): $2,970. Avg. inflation rate (1986): 
11.7%. 

Natural resources: Fish, cork, tung- 
sten, iron, copper, and uranium ores. 

Agriculture (9.1% of GDP): Products- 
grains, potatoes, olives, winegrapes, rice, 
citrus fruits, almonds. 

Industry (31.6% of GDP): Types- 
textiles, footwear, wood and pulp, paper, 
cork, metalworking, ore processing, chem- 
icals, fish canning, wine, electronics, auto- 
mobile assembly. 

Trade (1986): Exports— $7.2 billion: 
clothing, fabric, pulp, cork manufactures, 
leather goods, canned vegetables, wines, 
fish products. Imports— $8.8 billion: non- 
electrical machinery and appliances, crude 
oil and petroleum products, sugar, wheat, 
corn, chemicals, metal manufactures, 
transport equipment. Partners— EC, US, 
EFTA. 

Official exchange rate (June 1987): 
142 escudos=US$l. 

Membership in International 
Organizations 

UN and its specialized agencies. Council 
of Europe, NATO, European Community 
(EC), Organization for Economic Coopera- 
tion and Development (OECD), Interna- 
tional Energy Agency (lEA), INTELSAT, 
African Development Bank, African Devel- 
opment Fund. 



ness and on reducing public sector and 
balance-of-payments deficits. The aus- 
terity measures and related improve- 
ments in Portugal's trade balance suc- 
ceeded in converting the former 
balance-of-payments deficit to a $411 
million surplus in 1985. The tightening 
of fiscal and monetary policies, how- 
ever, led to a sharp recession and 



a 1.5% GDP decline during 1983-84. 
Export-led growth resumed in 1985, and 
the GDP increased 3.3%. Strong export 
and, later in the year, consumption per- 
formance caused the 1986 growth rate 
to reach 4%. Lower oil and agricultural 
commodity prices, falling interest rates, 
and the dollar's depreciation produced 
in 1986 a balance-of-payments surplus of 



V 1988 



51 



EUROPE 



about $1.1 billion and a budget deficit 
equal to 9% of GDP, compared to the 
corresponding 1985 figure of 12%. In- 
flation, which reached 29.3% in 1984, 
was reduced to 11.7% in 1986. The Por- 
tuguese Government hopes to achieve 
investment-led growth in 1987, while 
lowering inflation to 8%-9%. Its pol- 
icies aim to reduce consumption and 
credit growth to avoid an inflationary 
surge and deterioration in Portugal's 
internal and external balances. 

Portugal is a member of the Orga- 
nization for Economic Cooperation and 
Development and COCOM. It joined 
the European Community (EC) in Jan- 
uary 1986. Transition periods to bring 
most Portuguese agricultural prices and 
import charges in line with those of 
other EC countries and liberalize cap- 
ital movements generally end in the 
early 1990s. The sizable'amount of EC 
structural adjustment assistance al- 
ready received and expected in the 
future will help the Portuguese 
Government carry out its plans to 
modernize industry and agriculture. 

Portugal's economic system has 
changed profoundly since the 1974 revo- 
lution. Financial and commercial rela- 
tions with former colonies have declined 
in importance. The large industrial- 
financial groups that once controlled 
much of the economy have been 
dismantled. 

Most or all Portuguese-owned 
firms in the following sectors were na- 
tionalized in 1974 and 1975: banks, in- 
surance, airlines, railways, electricity, 
oil, gas, petrochemicals, cement, brew- 
eries, tobacco, woodpulp, steel, ship- 
ping, urban transit, and shipyards. 
Many other companies, although not 
nationalized, are under government 
control. Some eventually may be re- 
turned to their owners. Foreign-owned 
firms were exempted by statute from 
nationalization. Since 1979, Portuguese 
governments have sought to expand the 
scope for private enterprise and foreign 
investment in the economy. Constitu- 
tional revision in 1982 resulted in modi- 
fication of many of the socialist features 
of the 1976 constitution and set the 
stage for legislation that opened up sev- 
eral sectors, including banking, which 
had previously been off limits to private 
enterprise. Since 1984, six foreign 
banks (including three from the United 
States) and four Portuguese private 
banks have begun operations. Portugal's 
foreign investment legislation was liber- 
alized considerably in 1986. The liber- 
alization's major effect was to stream- 



52 



line the process of seeking government 
approval of foreign investment proposals 
in Portugal. Investment proposals from 
EC countries and, in practice, those 
from other countries, are generally 
approved on a pro forma basis by the 
Portuguese Government's foreign in- 
vestment institute. 

Labor unions — before the revolu- 
tion mainly instruments of government 
policy — have become active, indepen- 
dent agents. Two major labor con- 
federations have emerged. The oldest, 
the General Confederation of Por- 
tuguese Workers (CGTP-Intersindical), 
is communist conti-olled. In January 
1979, the General Union of Workers 
(UGT) was formed. This confederation 
of unions is viewed as the democratic 
alternative to, and has grown to about 
the same size as, the CGTP. The UGT 
has become a major force in the Por- 
tuguese labor movement and has gained 
international respect. 



FOREIGN RELATIONS 

Portugal's foreign policy reflects its 
geographic, cultural, and historic roots 
in the Western community and the de- 
termination of its post-1974 elected gov- 
ernments to reinforce those bonds and 
the democratic values they help sus- 
tain. Portugal took a major step in that 
direction by formally entering the 
European Community in January 1986. 
The government continues to give high 
priority to integrating Portugal suc- 
cessfully into the Community, and 
Portugal holds a broad range of new- 
opportunities and responsibilities as 
an EC member. A charter member of 
NATO, Portugal is seeking to modern- 
ize and convert its armed forces from 
their colonial-era configuration in order 
that they may play an increased role in 
alliance defense. 

Five centuries of exploration and 
colonizing activity have bequeathed 
Portugal a significant legacy of ties to 
the Third World, particularly in Africa. 
Since granting independence to the for- 
mer overseas territories of Angola, 
Mozambique, Cape Verde, Guinea- 
Bissau, and Sao Tome and Principe, the 
Portuguese Government has made ma- 
jor efforts to maintain and strengthen 
diplomatic, economic, and aid linkages 
with the governments of these nations. 



iTO 



[la 



In recent years, Portugal also has *'° 
sought to broaden diplomatic contacti 
with moderate Arab states in order tf" 
lay the basis for expanded economic 
and commercial relations. At the sam 
time, the Portuguese Government has 
maintained relations with Israel at th|" 
ambassadorial level. 

Following the 1974 revolution, 
Portugal opened relations with the 
Soviet Union and East European coiT' 
munist regimes. Ti-ade and cultural e: 
changes, however, remain at a low levf: 
As a NATO and EC member, Portugj 
approaches East-West issues in the 
framework of its own strong political, 
economic, and military ties to Westeril"!' 
Europe. 

Portugal continues to administer 
the small overseas territory of Macau, 
near Hong Kong. Portugal and China 
concluded an agreement on April 13, 
1987, to return the territory to Chines- 
rule in 1999. The interim period is 
intended to permit a smooth transitioi 

A dispute with Indonesia over 
the status of Portuguese East Timor 
resulted in a diplomatic break on De- 
cember 7, 1975, and Indonesia annexe 
East Timor in July 1976. Portugal doe 
not recognize the annexation as repre- 
senting an act of self-determination bj 
the East Timorese and has contested 
the Indonesian action in international 
fora. In 1982, the UN General Assem- 
bly asked the UN Secretary General t 
consult with both governments in an 
effort to resolve the issue. Portugal ar 
Indonesia subsequently have conductec 
discussions under the auspices of the 
Secretary General. 

Well over 2 million Portuguese 
reside in Europe, Africa, and the 
Western Hemisphere as permanent 
emigrants or — particularly in the case 
of Western Europe — as temporary 
workers. Through cultural and educa- 
tional programs as well as diplomatic 
efforts, Portugal seeks to maintain ties 
to these emigrant communities and to 
support efforts by emigrant workers to 
secure adequate social benefits from 
their host countries. 



Department of StatR Riillfitirii 



EUROPE 



.-PORTUGUESE RELATIONS 

iteral ties date from the earliest 
rs of the United States. On Febru- 

21, 1791, President George Wash- 
ton opened formal diplomatic 
itions between the two countries, 
ling Col. David Humphreys as U.S. 
lister Portugal's history of looking 
ward on the Atlantic, rather than 
■ard continental Europe, and the 
i. position as an Atlantic power 
e long brought the two nations into 
e contact. Emigration has furthered 

relationship, and sizable Portu- 
'se communities in the United Stales 
resent a strong cultural bond. 

The United States encourages a 
ble and democratic Portugal that is 
^ely associated with the industrial 
nocracies of Western Europe and 
TO. Portugal's nearly bloodless tran- 
on from authoritarian rule to con- 
utional democracy during 1974-76, 

exclusion of communists from its 
•liamentary governments, and its 
■ellent human rights record dem- 
itrate the commitment of the 
•tuguese to democratic values. The 
ited States has supported Portugal's 
•cessful entry into the West Euro- 
m economic and defense mainstream. 

S. Economic 

d Developmental Aid 

ice 1975, U.S. economic assistance to 
ftugal administered by the Agency 

International Development (AID) 
5 included a $300-miilion balance- 
payments loan, project loans and 
ints, including technical assistance 
i training totaling more than $109 
llion, $207 million in food assistance 
ns under the PL 480 (Title I) pro- 
im, $339 million in cash grants for 
)nomic and social development in 
Dport of U.S. -Portuguese security co- 
jration agreements, and $43.5 million 
grants for refugee assistance. Also, 
J million in housing investment loan 
arantees has been authorized with 
Dther $25 million programmed. 

The United States provided imme- 
,te assistance in the wake of a cata- 
ophic earthquake in the Azores on 
luary 1, 19<S0. Emergency supplies 
i services, funded by AID, were pro- 
led, and $10 million in grant aid for 
'onstruction assistance was later 
,de available. Voluntary efforts by 
S. forces stationed on Terceira Island 
were significant. 



From the cash grants provided by 
the United States, the Portuguese Gov- 
ernment has contributed nearly $100 
million to endow the Luso-American 
Development Foundation. The founda- 
tion was created in 1985 to support Por- 
tugal's economic and social development 
by promoting cooperation between 
Portugal and the United States in the 
scientific, technical, cultural, education- 
al, commercial, and entrepreneurial 
fields. By the end of 1986, the founda- 
tion had approved 138 projects. 



DEFENSE 

The United States, together with other 
NATO allies, provides assistance in the 
form of modern equipment and training 
to support efforts by the Portuguese 
Armed Forces to increase their par- 
ticipation in NATO defense. U.S. as- 
sistance has been used by Portugal to 
acquire two squadrons totaling 50 A-7P 
aircraft, as well as equipment for the 
Portuguese Army's NATO brigade, 
committed in a reserve capacity to an 
operational theater in Italy. The Por- 
tuguese Government hopes to complete 
its squadron of C-130Hs, a total of nine 
aircraft, through U.S. assistance. In 
addition, Portugal has moved to mod- 
ernize its antisubmarine warfare ca- 
pability in the Atlantic by ordering 



three new frigates with NATO assis- 
tance. The Portuguese Air Force has 
also purchased six P-3B aircraft that 
will be modified to a P-3P configura- 
tion for antisubmarine warfare 
missions. 

A 1951 bilateral defense agreement 
provides for U.S. Air Force and Navy 
access to the Portuguese air base at 
Lajes in the Azores. Under extensions 
to the 1951 agreement signed in June 
1979 and December 1983, the United 
States has provided Portugal $200 mil- 
lion in grant economic support funds 
during FY 1980-85, most of which has 
been devoted to the economic and social 
development of the Azores. The United 
States also is continuing to provide Por- 
tugal with both military assistance pro- 
gram grants and foreign military sales 
credits (see table p. 7). In addition to 
access to Lajes, Portugal agreed, by an 
exchange of notes in March 1984, to in- 
stallation of a U.S. satellite observation 
facility in southern Portugal. 



Taken from the Background Notes of 
November 1987, published by the Bureau 
of Public Affairs, Department of State. 
Editor: Juanita Adams. ■ 



U.S. Economic Assistance 

($))nniiins) 



198.5 1986 1987 

80 77 04.8 



Blended Credits— GSM-5 and GSM-102. 

The figure 11.5 for Commodity Credits (CCC) for FY 1987— total available— none has 
been used as of August 1987. 





FY 


198.3 


1984 


Economic Support P\inds 




20 


40 


Commodity Credits (CCC)-GSM-102 




550 


441 


Blended Credits 




70 


- 



U.S. Defense Assistance 



Military Assistance Program (grant) 

International Military Education and 
Training Program (grant) 

Foreign Military Sales Credits (loan) 



($inilli()iin) 












FY 1982 


198.3 


1984 


1985 


198H 


1987 


20 


37.5 


60 


70 


67.0 


80 



2.3 



y 1988 



53 



HUMAN RIGHTS 



Human Rights and 
Change in Eastern Europe 



jKity 



by John C. Whitehead 

Address before the International 
Human Rights Forum sponsored by the 
New York Academy of Sciences in New 
York City on February 26, 1988. Mr. 
Whitehead is Deputy Secretary of State. 

I am delighted to be here this morning 
to talk to you about a subject of keen 
interest to all of us — human rights. It 
has been and will continue to be a fun- 
damental tenet of our foreign policy. 
Within the State Department, we have 
a special bureau — the Bureau of Human 
Rights and Humanitarian Affairs — to 
focus this concern in our dealings with 
other countries. Secretary Shultz has 
given me the special responsibility of 
spearheading the efforts on human 
rights and Eastern Europe. Human 
rights is an integral element of our pol- 
icy toward Eastern Europe. 

Differentiation and 
the Process of Change 

Over the last 18 months, I have been 
engaged in a process of differentiation. 
It has been my goal to take a close look 
at the countries of Eastern Europe as 
separate nations within the world com- 
munity and not simply view them as 
members of a monolithic bloc with un- 
wavering political, economic, and mili- 
tary ties to the Soviet Union. While we 
can never forget the threat that the 
Warsaw Pact poses for us and our al- 
lies, we must also remember that East- 
ern Europe consists of a collection of 
disparate nations of central Europe, 
culturally, linguistically, and historically 
very distinct from each other and from 
the Soviet Union. As my fourth trip 
through the region earlier this month 
again made clear, while all are domi- 
nated by communist governments, they 
are remarkably differentiated in the 
level of freedom they allow their people 
and how they have reacted to Gor- 
bachev's "glasnost" and reformist 
policies. 

While the press and public opinion 
have concentrated on changes taking 
place in the Soviet Union and on the 
recent signing of the INF [Intermedi- 
ate-Range Nuclear Forces] Treaty, the 
winds of change have also begun to 



blow again with differing intensity 
through Eastern Europe. This is a re- 
sult of several factors. First and fore- 
most, as in the Soviet Union, economic 
stagnation has led the leaders in most 
of Eastern Europe to introduce eco- 
nomic reforms designed to revitalize 
their ailing economies. Some have be- 
gun once more to e.xplore the pos- 
sibilities for economic advancement 
through e.xpanded links with the West, 
including financial credits, heightened 
trade, and the transfer of technology. 
This has created an opportunity for the 
United States to push its human rights 
agenda in Eastern Europe with positive 
effect. 

A second factor is Gorbachev him- 
self He has endorsed economic reforms 
and, as a result, put conservatives in 
Eastern Europe on the defensive. Re- 
formers within the communist parties 
of Eastern Europe can now look east to 
Gorbachev for support, a situation radi- 
cally different from that of only a year 
or two ago. Now, the East European 
countries are behind the curve when 
compared with the Soviet Union. This 
fact has enormous significance for the 
outlook for change in these six 
countries. 

A third factor is generational. The 
old-line communist leaders, many of 
whom came to power soon after World 
War II, must now think about the 
transfer of power to a new generation 
that is less ideological, hence more 
open to economic reform. 

Bilateral Relations 
and Human Rights 

Our relations with the countries of 
Eastern Europe have long been condi- 
tioned by human rights concerns. We 
have always condemned policies and in- 
ternal regulations which keep families 
apart, prevent people from practicing 
their religious beliefs, or incarcerate 
them for what they think. Our respect 
for the basic human freedoms to which 
every person is entitled has always 
guided our policy toward countries 
which do not respect those freedoms. 
This policy remains unchanged. Trade 
relations, technology transfer, most- 
favored-nation (MFN) tariff status, sci- 
entific and cultural exchanges, all de- 
pend in whole or in part on human 
rights practices in these countries. 



JcJ 



le 



As a concrete example, consider 
MFN. Currently, Romania, Poland, a 
Hungary have MFN status. Romania! jt 
human rights record has shown no im jjij 
provement over the last year. As a re ^\ 
suit, its MFN status, subject to annul jj 
review under U.S. law, is in serious 
jeopardy. Poland had most-favored- 
nation status restored just over a yeaj 
ago, a recommendation I made after 
my first visit, based on significant imi w, 
provements in its human rights recorci 
and the steps it has taken toward gen 
ine national reconciliation in the past 
2-3 years. Hungary continues to enjo; 
MFN because it does not impose dis- 
criminatory emigration rules on its mi 
nority citizens and because it continue 
to pursue reform. 

One of the central goals of my tri] 
to Eastern Europe has been quietly 
and persistently to tie improvement in 
our political and economic relations to 
improvement in their human rights pe 
formance. The U.S. commitment to hu 
man rights does not depend on who sil 
in the White House. Nor can this com- L 
mitment be turned aside by claims thj- 
we are interfering in the domestic af- 
fairs of sovereign nations when we crit 
cize the human rights performance in 
other countries, a claim I hear all too 
frequently. As I point out to leaders 
around the world, the Universal Decla 
ration of Human Rights of 1948 and, 
in the case of Eastern Europe, the 
Helsinki Final Act of 1975 provide a se 
of international norms to which all sig- 
natory nations are bound. 

By way of detailing how our humai' 
rights concerns affect our foreign polici 
in Eastern Europe, let me turn to a 
description of my recent trip. I visited 
Poland, Bulgaria, Romania, and Czech- 
oslovakia this month. The goal of my 
trip was to assess progress we have 
made in these countries over the past 
year in our step-by-step process — the 
means we use to link improved relation! 
to demonstrated progress — and to 
gauge where we go from here. 

Poland 

Overall relations, at a very low point 
only a few years ago, have expanded 
considerably. This was my second trip 
to Poland in just over a year. I met 
with Chairman of the Council of State 
General Jaruzelski, Archbishop 
Dabrowski, and Solidarity leader Lech 
Walesa. My conversations were direct, 
substantive, and useful. 

A major reason for our reengage- 
ment with the Polish Government is im- 
provement in human rights there. The 



54 



Department of State Bulletin 



HUMAN RIGHTS 



mesty of political prisoners in Sep- 
nber 1986 has, in essence, held; pass- 
rt issuance policies have been liber- 
zed; and an independent journal has 
reived permission to publish. There is 
.0 a sincere effort to institute eco- 
mic reform. We welcome this as a 
Icessary element in improving the lot 
the Polish people and in increasing 
land's economic — and political — 
liependence. 

As a result of these improvements, 
signed a civil aviation agreement, 
licussed our recent agreement to pro- 
le up to $10 million to the Catholic 
lurch's Agricultural Foundation Rural 
liter Supply Project through Catholic 
i'lief Services, and initiated a dialogue 
ways of combatting drug trafficking, 
krlier this month, the first meeting in 
me years of the U.S. -Polish Joint 
ade Commission was held. And I ex- 
ided an invitation from Secretary 
ultz to Foreign Minister Orzechowski 
visit the United States. 

Yet much remains to be done. The 
ide union Solidarity is still banned, 
d opposition figures are harassed, 
le government must achieve genuine 
tional reconciliation if economic re- 
-ms are to succeed. I told the Poles 
; support their efforts at meaningful 
onomic reform and are very inter- 
ted in their bid for a sound standby 
reement with the International Mon- 
ary Ftind. I also told them the Polish 
idership will have to win support for 
; reforms from the broad spectrum of 
ilish society before any measures can 
ally be effective. Walesa told me Soli- 
irity is ready to give that support but 
at it must be consulted by the gov- 
nment. And Archbishop Dabrowski 
nfirmed that the church is ready to 
cilitate such a dialogue. 

Poland constitutes our greatest 
iccess in the step-by-step approach, 
elations have improved to the benefit 
the American as well as the Polish 
>ople. We both agree our bilateral re- 
tions are ready to move to a "higher 
age." We wall continue to develop and 
I encourage both an improved human 
ghts atmosphere and economic re- 
talization in Poland. 

ulgaria 

found a surprising degree of progress 
Bulgaria. The government has em- 
irked on an ambitious economic re- 
rm program and clearly desires to 
lin greater access to the world econ- 
ny. Far-reaching steps have yet to be 
iken, but they have developed an im- 
ressive, reasonable reform program 
hich, if successful, will establish a 



market economy and banking system. 
The energetic President Zhivkov has 
entrusted this program to a number of 
bright young Bulgarians who seem 
committed to change. I assured them 
the United States was ready to help 
but that their human rights record 
would have to show improvement. 

In 1984, the Bulgarian Government 
began forcibly assimilating the 
600,000-900,000 ethnic Turks (almost 
10% of Bulgaria's population) by com- 
pelling them to abandon their Turkish 
and Muslim names and adopt Bulgarian 
and Christian ones, often at gunpoint. 
In my conversations with President 
Zhivkov and other government leaders, 
I discussed at length our human rights 
concerns, especially the disturbing 
plight of the Turkish minority in Bul- 
garia and divided family cases. We have 
been getting good results on those 
cases. I was encouraged to find 
Zhivkov was more open to discussing 
the Turkish minority situation than last 
year He talked about the possibility of 
resettlement and a visit to ethnic Turks 
in their villages by an impartial multi- 
national investigative group. We have a 
long way to go, but I believe we opened 
the door to further progress. 

Romania 

U.S. -Romanian relations have deterio- 
rated over the last year. President 
Ceausescu was unwilling to acknowl- 
edge the importance we attach to hu- 
man rights as a key part of our 
bilateral relations. I made clear to him, 
privately and publicly during my depar- 
ture press statement, that I was disap- 
pointed by what I saw. The chances of 
renewal of Romania's MFN status are 
less than fifty-fifty as a result. MFN 
has provided a well-established forum 
for measuring human rights progress in 
Romania. Its renewal has been harder 
to achieve as the internal situation has 
deteriorated. 

I saw and experienced firsthand 
evidence of Romania's human rights 
problems. Militia men followed my 
every movement by car or by foot. Sev- 
eral of those invited to a reception our 
ambassador hosted in my honor were 
harassed by the poHce and were able to 
gain access to the reception only with 
considerable difficulty. Others were 
prevented from coming at all. At least 
one well-known figure was kept under 
house arrest to prevent any contact 
during my visit. This was in notable 
contrast to the situation in Poland, 
for example, where I met with Lech 
Walesa and other Solidarity leaders at 
the ambassador's residence without 
interference. 



The economic situation in Romania 
is bleak, yet no efforts have been made 
to introduce meaningful reform. The 
leadership, fixed on a draconian cam- 
paign to reduce foreign debt, is either 
unaware of or unmoved by the growing 
economic chaos which has caused severe 
deprivation to Romanian citizens and 
families, including a severe shortage of 
basic foods and limited heat, light, and 
hot water When public frustration with 
this situation erupted last November in 
the city of Brasov, the government re- 
sponded with numerous arrests. The 
one bright spot is that the Romanians 
clearly signaled their continued interest 
in maintaining relations, regardless of 
MFN status. We will continue to link 
those relations to progress in human 
rights in Romania. 

Czechoslovakia 

I received mixed signals in Czechoslo- 
vakia. There, too, our relations have 
expanded, in part due to some marginal 
improvement on the human rights 
front. Over the last year, we signed a 
new civil aviation agreement, brought 
into force a new consular convention, 
and held three sessions of the joint bi- 
lateral working groups on humanitarian 
affairs and business facilitation. We also 
expanded exchanges in the fields of ed- 
ucation and culture. Our low level of 
trade is an area where I believe there 
is potential to improve our relations. 

I was struck by an improvement in 
the overall environment — dissidents 
and government officials attended the 
same reception held by our ambassador 
in Bratislava, in sharp contrast to the 
discreet meeting I had with Charter '77 
members in Prague a year ago, but se- 
vere human rights violations still con- 
tinue in Czechoslovakia. I told Presi- 
dent Husak, Foreign Minister 
Chnoupek, and others that we need to 
see tangible and real progress in the 
areas of freedom of religion, freedom of 
assembly, the release of political pris- 
oners, and relaxed emigration rules and 
procedures. I offered to stop talking 
about human rights, but only at the 
expense of severely limiting future im- 
provement of our relations. President 
Husak assured me they wanted to keep 
human rights on our bilateral agenda. 

There is potential for progress in 
Czechoslovakia. Some divided family 
cases have been resolved, but others 
remain. Negotiations are now taking 
place between the Czechoslovak Gov- 
ernment and the Vatican on the ques- 
tion of filling some of the openings for 



av Iflfifi 



55 



MIDDLE EAST 



bishop that now exist in the country. 
These negotiations are a faint begin- 
ning toward the free exercise of re- 
ligion. I made it clear that once there is 
significant and genuine progress in all 
of these areas, Czechoslovakia will 
qualify for the MFN status it seeks. 

Objectives of U.S. Policy 

The United States forcefully projects 
its human rights policy in Eastern 
Europe and will continue to do so. The 
logical question is: what do we hope to 
achieve? In practical terms, the answer 
varies according to the country. We re- 
alize that human rights problems in 
Eastern Europe are not going to disap- 
pear overnight. But talk of change is 
starting to be reflected in changed 
policies. 

In our human rights dealings with 
Eastern Europe, therefore, we seek to 
gain as much as we can, through 
steady, incremental improvement to 
push these systems as far as we can get 
them to go at the moment. We look for 
greater freedom for the peoples of 



Eastern Europe to express themselves, 
to assemble, to believe as their con- 
sciences guide them. We seek to influ- 
ence their governments to be more 
sensitive to national aspirations and 
more willing to respect human and po- 
litical rights and fundamental freedoms. 
As these East European governments 
respond, we are willing to increase 
trade and the whole range of relations 
with them. We believe this ultimately 
benefits the people of these countries, 
as well as ourselves, through economic 
betterment and a more Western 
orientation. 

As I said a few minutes ago, 
change is in the air in Eastern Europe. 
Much of the impetus for change is 
coming from the Soviet Union, but 
more importantly, much of it is self- 
generated. Most leaders in Eastern Eu- 
rope now clearly recognize the need for 
economic reforms that in turn may be 
the genesis for liberalization in other 
areas. U.S. policy is firmly committed 
to a step-by-step process to promote 
change in Eastern Europe which, in the 
long run, will benefit us all. ■ 



A Statement for Palestinians 



Secretary ShuUz's statement made 
at the American Colony Hotel in East 
Jerusalem on February 26, 1988 A 

I have a statement for Palestinians. 
Palestinian participation is essential to 
success in the peace process. I had 
hoped to carry this message to East 
Jerusalem this evening and to hear 
firsthand from leading Palestinians 
about your aspirations and your point of 
view. Peacemaking is difficult. Peace 
has its enemies. Even small steps to- 
ward peace can be significant in moving 
beyond mistrust and hatred. In a small 
way, I wanted to do that this evening. 

All the peoples of this land need to 
be able to look to a future of dignity, 
security, and prosperity. New respect 
for rights and new readiness for politi- 
cal change must replace old recrimina- 
tion and distrust. 

The United States is for positive 
and rapid change. Fundamental consid- 
erations guide our approach. 

First, Palestinians and Israelis 
must deal differently with one another. 
Palestinians must achieve control over 



political and economic decisions that af- 
fect their lives. Palestinians must be 
active participants in negotiations to 
determine their future. Legitimate Pal- 
estinian rights can be achieved in a 
manner which protects Israeli security. 
Israeli security and Palestinian security 
are necessary conditions for a better 
future for Palestinians, as well as for 
Israelis. 

Second, these moves must be part 
of a broader effort to reach a compre- 
hensive settlement. Israel and the oc- 
cupied territories do not exist in 
isolation. Jordan, Syria, Lebanon, and 
Palestinians living outside the territo- 
ries have concerns which need to be 
resolved. In moving toward a compre- 
hensive settlement. Resolutions 242 and 
338, in their entirety, must be the basis 
for negotiations. 

Third, what we are seeking must 
be achieved through negotiations. Ne- 
gotiations work. Negotiations produce 
agreements which meet the fundamen- 
tal concerns of all parties. Experience 
shows you that you can have an agree- 
ment with Israel, and it will be kept by 
Israel. 



Fourth, the start of negotiations 
must be soon, and the pace of negoti; 
tions must be rapid, so that results c 
be achieved with equal rapidity. 

The human resources and potent 
of Arabs and IsraeUs are boundless. 
They have energy and drive which, if 
not directed against each other, can 1: 
marshaled collectively to explore sci 
ence and technology, literature, and t 
arts. This region, which nurtured 
three great world religions, carries 
within it a powerful and moral force. 
Islam, Christianity, and Judaism can 
work together in creating a more dur 
ble, moral, and spiritual world for all 



lert 



:ep.' 



Our vision is of Israelis and Pal- 
estinians living together in peace in 
this land; where the rights of each ar 
respected; where the energies of all a 
directed at peaceful purposes; where 
security and trust exist. Israelis and 
Palestinians need to see in each other 
the embodiment of their own dreams. 
They will realize that the fulfillment ( 
their own dreams is impossible withoi 
the fulfillment of the other side's 
dreams. They will see that dreams 
rooted in reality are dreams which ca; 
be fulfilled. 

Opportunity knocks loudly on yoi 
doors. Now is the time to get to work 
We have a workable plan, and we are 
ready to commit our efforts to it. The 
time is right, together, to make deci- 
sions of historic importance. Let us 
translate our dreams into the reality c 
peace, rights, and security for all 



laki 



"Press release 29 of Feb. 29, 1988. 



Secretary Shultz's Visit 
to the Middle East and Europe 



February 24 


Depart U.S. 


February 25-27 


Jerusalem 


February 27 


Amman 


February 27 


Damascus 


February 27-28 


Jerusalem 


February 28 


Cairo 


February 28-29 


Jerusalem 


February 29 


Amman 


February 29-March 1 


Jerusalem 


March 1 


London 


March 1-3 


Brussels 


March 3 


London 


March 3-4 


Jerusalem 


March 4 


Damascus 


March 4 


Cairo 


March 5 


Return U.S. 



56 



MIDDLE EAST 



i/liddle East Peace Plan 



The following article by Secretary 
hultz was published in The Wash- 
igton Post on March 18, 1987. 

'here are few fixed rules for resolving 
onflicts. Each conflict has a unique 
istory and unique characteristics. 
]ach party to a conflict has its own 
reams, concerns and fears. The task is 

find the right inducements to draw 
he parties off the battlefield and into 
he negotiating room. The success of 
egotiations is attributable not to a 
articular procedure chosen but to the 
eadiness of the parties to exploit op- 
ortunities, confront hard choices and 
lake fair and mutual concessions. 

1 In the Arab-Israeli conflict, nego- 
jiations work. They provide the means 
ir parties to learn to deal with each 
ther. They produce durable and real- 
5tic agreements that meet the funda- 
lental concerns of the parties. 
Experience shows that Arabs and Is- 
aelis can make agreements and keep 
(hem. 

The United States has launched an 
nitiative designed to produce negotia- 
ions — direct, bilateral Arab-Israeli ne- 
:otiations to achieve comprehensive 
leace. Our concept is based on all the 
irovisions and principles of U.N. Se- 
urity Council Resolution 242, which is 
he internationally accepted framework 
or negotiations. In the case of the 
Vest Bank and Gaza, the initiative in- 
'olves a two-stage interlocked set of ne- 
gotiations designed to produce rapid 
md fundamental change in the way 
\rabs and Israelis relate to each other. 

The United States is a firm and 
consistent supporter of direct, bilateral 
legotiations between Israel and all of 
ts neighbors as the means to achieve a 
jomprehensive peace. At the same 
ime, the United States has always 
jeen willing to consider any approach 
,hat could lead to direct negotiations, 
ncluding an international conference. 



In recent months, some parties 
have focused on a specific kind of inter- 
national conference — one that would 
have an authoritative role or plenipo- 
tentiary powers. In January of this 
year, the United States vetoed a resolu- 
tion in the U.N. Security Council that 
called upon the secretary-general to 
convene such a conference. The United 
States made clear its belief that this 
kind of conference would make real ne- 
gotiations impossible. It would be a ve- 
hicle for avoiding meaningful 
negotiations, not promoting them. 

The issue confronting the parties in 
the Middle East, therefore, is not 
whether an international conference 
should or should not be convened. That 
misses the point. The Arabs require a 
conference to launch negotiations; with- 
out a properly structured conference, 
there will be no negotiations. But the 
wrong kind of conference should never 
be convened. The United States will 
not attend that kind of conference. No 
sovereign state would agree to attend 
the kind of conference that would pre- 
sume to pass judgment on issues of na- 
tional security. 

The issue is whether the moment is 
here to negotiate an end to the Arab- 
Israeli conflict; whether each party is 
ready and able to confront hard choices 
and make difficult decisions; and 
whether the requirements of the par- 
ties are amenable to a procedural blend 
that satisfies minimal demands. 

The strength of the American ap- 
proach is its integrity; no individual as- 
pect of it can be extracted, finessed or 
ignored without sacrificing its balance. 
The conference we support launches a 
series of bilateral negotiations and 
thereafter may receive reports from the 
parties on the status of negotiations, in 
a manner to be agreed by the parties. 
All conference attendees will be re- 
quired to accept Security Council Reso- 



lutions 242 and 338 and to renounce 
violence and terrorism. The conference 
will be specifically enjoined from in- 
truding in the negotiations, imposing 
solutions or vetoing what had been 
agreed bilaterally. 

The United States is committed to 
this integral concept for beginning di- 
rect, bilateral negotiations. We will not 
permit any aspect of our proposal to be 
eroded, compromised or expanded be- 
yond its meaning. In particular, we will 
not permit a conference to become au- 
thoritative or plenipotentiary, or to 
pass judgments on the negotiations, or 
to exceed its jurisdiction as agreed by 
the parties. 

The ingredients for a peace process 
are present. There is an unacceptable 
and untenable status quo. There are 
competing parties willing to shed illu- 
sions and temper dreams to the under- 
lying realities. And there are realistic 
and achievable ideas on the table that 
meet the fundamental concerns of 
everyone. 

Our task is also clear. We must act 
with integrity, resolve and tenacity to 
bring Arabs and Israehs off the bat- 
tlefield and into negotiations. The ini- 
tiative put forward by the United 
States — two interlocked stages or 
direct negotiations launched by a prop- 
erly structured international confer- 
ence — is realistic and compelling. 

This is the moment for a historic 
breakthrough, and this is the plan. The 
time for decisions is now. ■ 



^^^ -"^fifi 



57 



REFUGEES 



Aspects of U.S. Resettlement Programs 
for Vietnamese Refugees 



by Robert Funseth 

Addresses before the annual dinner 
meeting of the Families of Vietnamese 
Political Prisoners Association on 
November U, 1987, in Falls Church, 
Virginia, and before the annual con- 
sultative meeting on the UN High 
Commissioner for Refugees Orderly 
Departure Program from Vietnam, 
Geneva, and Switzerland, on December 
3, 1987. 

Mr. Funseth is Senior Deputy As- 
sistant Secretary for Refugee Pro- 
grams. 



NOVEMBER 14, 1987 

I am deeply honored by your invitation 
to share this evening with you in sup- 
port of the Vietnamese political pris- 
oners and to be asked to address you. I 
have the gi'eatest respect for your noble 
cause and the greatest admiration for 
your personal courage in sustaining 
your heartfelt efforts and in maintain- 
ing your hope in the face of tremendous 
emotional hardship and torment. 

Sitting together to share a meal is 
one of the most venerated of traditions 
in the history of the human family. It 
is, therefore, right and proper that we 
should experience together this pro- 
foundly symbohc act as we commemo- 
rate and rededicate ourselves to the 
freedom of your husbands, your fa- 
thers, your brothers, and your relatives 
and our Vietnamese colleagues and our 
friends. 

You will all remember that in Sep- 
tember 1984, Secretary Shultz made 
the historic announcement of President 
Reagan's great humanitarian initiative 
aimed at bringing all of the "reeduca- 
tion" camp prisoners and their qualify- 
ing family members to the United 
States. You will also recall that, sadly, 
the Vietnamese authorities backed 
away from their initial willingness to 
negotiate with us to implement the 
President's program. We profoundly re- 
gret that change. We sincerely hope it 
will change. 

When it was my privilege to speak 
briefly at your solemn commemoration 
in April at the U.S. Capitol— which 
marked the 12th anniversary of the im- 
prisonment of your loved ones — I re- 
affirmed our readiness to resume 



bilateral discussions with Hanoi at any 
time. Six weeks ago, in his testimony 
before the Congress of the United 
States, Secretary of State Shultz again 
reiterated this pledge on behalf of the 
government. 

And this evening I stand before 
you to reaffirm with the strongest pos- 
sible words and feelings our firm com- 
mitment to continue our steadfast 
efforts to bring about the release and 
resettlement in the United States of all 
the former and current "reeducation" 
camp prisoners and their accompanying 
family members who wish to be reset- 
tled in America. 

Proposals To Hasten 
Resettlement and Reunification 

I believe you all know that we have 
urged the Vietnamese Government to 
allow all the prisoners who have been 
released from their "reeducation" camp 
prisons to apply to leave Vietnam 
through the Orderly Departure Pro- 
gram (ODP) and to approve their ap- 
plications for exit permits. Since our 
formal presentation of the President's 
initiative to the representatives of the 
Vietnamese Government in Geneva in 
1984, 270 former prisoners and over 
1,000 of their accompanying family 
members — for a total of nearly 1,300 
persons — have been allowed to come to 
the United States. Perhaps some of you 
are here this evening. 

However pleased we are that these 
1,300 persons have been permitted to 
leave, we remain greatly disappointed 
that there are 11,000 other Viet- 
namese — including 2,280 former pris- 
oners — whose names we have sent to 
the Vietnamese, who have not been 
given permission to leave, as well as 
many, many others who still have not 
come to our attention. 

In your association's letter to me, 
you noted the September announce- 
ment in Hanoi of the release of 480 po- 
litical prisoners and asked that we 
consider five specific proposals that 
might hasten their resettlement and re- 
unification with relatives in the United 
States. Please allow me now to respond 
directly to each of your proposals. 

First, you asked that we: "continue 
to press Vietnam to release the pris- 
oners for resettlement in the United 

States." 



■ps 



ta 



We have done so. We are doing so. l?*'" 
We will do so. Our policy is clear; our US" 
objective is clear. We have declared, itri 
again and again, our readiness to nego- ptk 
tiate the release of all political pris- j i 
oners, and we intend to keep trying. I 
will once more be leading the U.S. del- 
egation to the annual meetings with tb 
Vietnamese in Geneva 3 weeks from 
now, and I pledge that we will again 
use these bilateral meetings to reaffirw| 
strongly President Reagan's human- 
itarian initiative for the release of the 
"reeducation" camp prisoners and for 
their resettlement in the United States" nt 

Second, you asked that we: "assuni i 
that, if these political prisoners are al- 
lowed to emigrate, adequate budget 
and resettlement numbers are available) 
to take care of this increased 
requirement." 

You always have our assurance to 
do this. We stand prepared to take all 
necessary steps, in consultation with 
the Congress, to ensure that we have 
the necessary money and refugee ad- 
mission numbers to resettle ahy and all 
of these prisoners the Vietnamese au- 
thorities allow to emigrate and who 
wish to be resettled in the United 
States. 

Third, you asked that we: "assure 
that letters of introduction (LOIs) are 
issued to any of the recently released 
political prisoners who do not have such* 
a letter as soon as the names of these 
political prisoners can be identified." 

Again, you have our assurance. 
When we are informed of the identity oj 
recently released prisoners, the Ameri- 
can Embassy in Bangkok is instructed 
immediately to review the files and is- 
sue LOIs wherever needed. 

Fourth, you asked that we: "be 
prepared to establish a bilateral pro- 
gram with Vietnam to process the polit- 
ical prisoners if necessary and required 
by the Vietnamese." 

You ask that we be prepared to 
establish a bilateral program. We have 
already had direct bilateral meetings 
with the Vietnamese in 1984, 1985, and 
1986. I can assure you that we are fully 
prepared to establish such a bilateral 
program if this is necessary. It may not 
be necessary. Our current Orderly De- 
parture Program mechanism and the 
initiative we have put to the Viet- 
namese representatives for these pris- 
oners would be perfectly sufficient 
without the establishment of a separate | 
program. Through it, we have resettled j 
1,300 former prisoners and their fami- j 
lies. However, if the Vietnamese au- 
thorities indicate that they would j 



58 



Deoatlmen^^tate 



REFUGEES 



refer to establish such a bilateral pro- 
ram with us for these prisoners, we 
re ready to discuss the modalities of 
.ich a program without further delay. 
Finally, fifth, you asked that we: 
;)i-()\ ide to the Vietnamese community, 

I w riting, clear guidelines on what 
imily members can accompany." 

We appreciate that clear guidelines 

II accompanying family members are of 
reat importance to all of you. Our of- 
ce has already provided your presi- 
ent with a written explanation of the 
jrrent guidelines. If additional infor- 
lation or clarification is required, we 

ill be more than happy to provide that 
s well, and we are always available to 
nswer any of your questions. 

Resumption of the 

'•rderly Departure Program 

am pleased to be able this evening to 
ive you some good news about the Or- 
erly Departure Program itself. It is 
■orking again, and we are encouraged 
y the way things seem to be going, 
.fter 18 months of persistent U.S. dip- 
)matic activity, we succeeded in July 
1 reaching an agreement with the 
'ietnamese Government for the re- 
umption of interviews for the ODP. In 
eptember, a parallel agreement was 
eached on a bilateral program with the 
Ietnamese Government for the Amer- 
sian children. Two interview trips to 
letnam by teams of U.S. consular and 
NS [Immigration and Naturahzation 
.ervice] officers from the American 
Embassy in Bangkok have now been 
uccessfully completed. Each resulted 
n the interview and approval of over 
,000 persons. We now expect to be 
naking further interview trips on a 
easonably regular basis, and we hope 
or similarly positive results. 

I am sure that all of you are aware 
hat at the beginning of 1986, the ODP 
uffered a severe setback. At that time, 
he Vietnamese authorities unilaterally 
;uspended the interviewing of new 
)DP applicants for the United States 
md sharply cut back the ODP program 
or all other participating countries. We 
;onducted a series of meetings with 
v'^ietnamese officials over the next 18 
nonths, during which we urged that 
nterviewing be allowed to resume and 
luring which we made proposals on 
low the interviewing process could be 
improved and accelerated once it was 
resumed. 

In July of this year in Hanoi, the 
Vietnamese Government accepted our 
proposals and agreed to a resumption of 



interviewing in Ho Chi Minh City. 
Since then, we have twice sent inter- 
view teams to Ho Chi Minh City. I am 
very pleased to be able to report to you 
this evening that these trips have been, 
in our view, successful, and we are en- 
couraged by the way they have gone 
and, indeed, by the very good coopera- 
tion which the Vietnamese officials in 
Ho Chi Minh City have extended to the 
U.S. officials. 

Let me explain briefly how the in- 
terview process has changed and why 
we believe it could result in faster de- 
partures from Vietnam for those we are 
able to interview and approve. Before 
the end of 1985, the interviewing was 
done for us by UNHCR [UN High 
Commissioner for Refugees] personnel. 
The results of the interviews were then 
taken back to the American Embassy 
in Bangkok, where they had to be re- 
viewed by U.S. consular and immigra- 
tion officers. Under the new U.S.- 
proposed procedures, U.S. consular and 
immigration officers are going directly 
to Ho Chi Minh City to conduct the 
interviews in person. This means that, 
hopefully, most cases can be adjudi- 
cated on the spot, subject to satisfac- 
tory medical examination results, with 
final approval normally occurring 
within only a few weeks after the inter- 
views take place. Since there is no 
longer a long backlog of people waiting 
for flights, we hope that the first of 
those approved in September will be 
able to join their relatives in the United 
States before the end of the year. 

There still remain some unresolved 
processing problems. As you know, the 
ODP office at the embassy in Bangkok 
issues letters of introduction on behalf 
of applicants whose files are sufficiently 
complete and who have either an ap- 
proved Form 1-130 petition which is 
"current," or nearly so, or who have 
been tentatively approved for travel. 
The United States has provided to the 
Vietnamese authorities the names of 
everyone to whom we have issued an 
LOI. In August of this year, after the 
Vietnamese Government agreed to the 
resumption of interviewing, the Ameri- 
can Embassy sent them a new consoli- 
dated list of everyone to whom an LOI 
had been issued who was still in Viet- 
nam. That list contained about 95,000 
names. We hope that the Vietnamese 
authorities will increasingly draw from 
these U.S. lists of persons who have 
already been issued LOIs. 

For most of the time that inter- 
viewing was suspended, the Viet- 
namese Government did not issue any 
exit permits — or issued only a very few. 



The good news is that they have, in 
recent months, resumed issuing some 
exit permits again. So we will make 
this one suggestion for something you 
can do: if your relatives in Vietnam 
have LOIs but do not have exit per- 
mits, we would suggest that you urge 
them to reapply now, either for an exit 
permit or for an appointment for an 
interview. The chances for favorable ac- 
tion on a request may be better than 
they have been for some time. Urge 
your family members in Vietnam to 
take a copy of their LOI to the appro- 
priate authorities and try again now. 
They may not be successful, but they 
may be. 

U.S. Commitment 

to Refugee Resettlement 

Our mission is not to posture. Our mis- 
sion is to bring about the freedom of 
your relatives and to obtain Vietnamese 
agreement for their resettlement in the 
United States. Therefore, we must be 
discreet and careful in what we say in 
public. We leave the polemics to others. 
WTien we meet with the Vietnamese au- 
thorities on this unresolved human- 
itarian issue we must be sober, sincere, 
and serious — and we are. 

There is, we believe — based on the 
recent positive developments concern- 
ing the Orderly Departure Program — 
some reason to be hopeful that there 
may be better news ahead about the 
"reeducation" camp prisoners and their 
prospects for being allowed to leave 
Vietnam for resettlement here. 

In June, in an address to the for- 
eign ministers of the Southeast Asian 
countries meeting in Singapore, Secre- 
tary of State George Shultz declared 
that the United States would support 
the countries of first asylum for the 
long haul, including the continuation of 
a substantial American refugee reset- 
tlement program. In September, this 
pledge was made concrete in President 
Reagan's formal proposal to the Con- 
gress and subsequent determination to 
set the first-asylum admissions ceiling 
for FY 1988 at 29,500 and the ODP 
ceiling at 8,500, for a total of 38,000 
persons. 

Commitment is, indeed, the watch- 
word of U.S. refugee policies and pro- 
grams. We are committed to humani- 
tarian ideals as a nation. We are com- 
mitted to helping refugees who are 
the victims of oppression in this world. 
We are committed to generous refugee 
admissions programs in order to offer 
hope and new lives to the thousands 
and thousands who have lost their 



May 1988 



59 



REFUGEES 



homes. And we are committed to fight- 
ing for the freedom to emigrate of 
those still imprisoned for their beliefs. 
Your loved ones are uppermost in our 
thoughts and actions, and we commit 
ourselves — and rededicate ourselves 
again this evening — to unceasing efforts 
to obtain their freedom. 



DECEMBER 3, 1988 

Mr. High Commissioner [Jean Pierre 
Hocke], we would like first to express 
appreciation to you and those of your 
organization for your efforts and inter- 
est on behalf of the UNHCR's Orderly 
Departure Program. The sponsorship 
by UNHCR of this very important an- 
nual consultation and your personal 
participation again this year as chair- 
man is a significant manifestation of the 
commitment of UNHCR to do every- 
thing possible to ensure that this pro- 
gram becomes truly a viable, safe, and 
orderly alternative to clandestine, dan- 
gerous departures from Vietnam as en- 
visaged in the 1979 memorandum of 
understanding between the Socialist 
Republic of Vietnam and the UNHCR. 
We believe that your recent visit to 
Hanoi contributed in an important and 
helpful manner to the renewal of this 
vital program. 

The United States is greatly en- 
couraged by the resumption of process- 
ing of applicants for resettlement in our 
country which has occurred in the past 
months and by the recent increase in 
approval for other countries. We are 
here to build on that progress. We sa- 
lute the good will and cooperation dem- 
onstrated by the Government of the 
Socialist Republic of Vietnam and its 
representatives, the UNHCR, the ICM 
[Intergovernmental Committee for Mi- 
gration], and all other parties involved. 
Together, we now have the opportunity 
and the challenge for a new begin- 
ning — to restore departures to the lev- 
els achieved in 1984 and 1985, when, for 
the first time, more Vietnamese left via 
the ODP than risked clandestine, dan- 
gerous departures. But our goal must 
be to go beyond those levels. We, there- 
fore, welcome the Minister's [Viet- 
namese Vice Minister for Foreign 
Affairs Tran Quang Co] clear statement 
that his country does not wish its cit- 
izens to become "boat" people. 

It is useful to recall on this occa- 
sion that the memorandum of under- 
standing recognizes both "family 
reunion and other humanitarian cases." 
It provides that selection of those per- 
sons authorized to leave Vietnam is to 



Is 



be made on the basis of lists of persons 
submitted by the Vietnamese Govern- 
ment and lists of persons submitted by 
the receiving countries. The 1979 mem- 
orandum also affirms the central role of 
the UNHCR. 

U.S. Commitment to the ODP 

On behalf of my government, I reaffirm 
the steadfast commitment of the United 
States to the UNHCR Orderly Depar- 
ture Program within the terms of the 
1979 understanding. This American 
commitment was further strengthened 
by all of the Members of the U.S. Con- 
gress in a 1987 resolution unanimously 
endorsing the program's provision for 
departures from Vietnam for both fam- 
ily reunification and for humanitarian 
reasons. 

Vietnam's Southeast Asian neigh- 
bors also recognize the central human- 
itarian role of the Orderly Departure 
Program. At their June meeting in Sin- 
gapore, the Foreign Ministers of the 
Association of South East Asian Na- 
tions strongly urged the Government of 
the Socialist Republic of Vietnam to 
take measures to remove the causes of 
clandestine departures from Vietnam 
and to cooperate earnestly with the 
UNHCR and the resettlement coun- 
tries to ensure the success of the Or- 
derly Departure Program. 

Alternative to the Perils 
of Clandestine Flight 

Since 1980, the Orderly Departure Pro- 
gram has enabled more than 130,000 
persons to depart Vietnam safely and in 
an orderly way to build new lives in 
new homelands, with over 60,000 com- 
ing to my country. In 1984, more than 
28,000 persons departed Vietnam under 
this program, and in 1985, more than 
26,000. In those years, the Orderly De- 
parture Program truly was becoming 
an alternative to the perils of clan- 
destine departure. Sadly, this is not 
now the case, vdth clandestine depar- 
tures now exceeding departures under 
the Orderly Departure Program. How- 
ever, with the recent renewal of the 
program, we are hopeful that it will 
once again become the principal means 
for persons to depart Vietnam. 

Amerasians and Prisoners 

At our consultations in 1984, I had the 
honor to announce on behalf of my gov- 
ernment two special humanitarian ini- 
tiatives of the President of the United 
States. One called for the admission to 
the United States of all Amerasian chil- 



« 



rj' 



dren, their mothers, and close family 
members from Vietnam who wished to 
be resettled in the United States. The 
second called for the resettlement of al r 
the so-called reeducation camp inmates 
and their qualifying family members 
who also wished to be resettled in the 
United States. 

We are very pleased that recent 
steps have been taken to fulfill the in- 
tent of the initiative on behalf of 
Amerasians. We remain, however, pro- 
foundly disappointed that the Viet- 
namese authorities have not as yet 
responded positively to our initiative ow 
behalf of the reeducation camp pris- 
oners — a population of compelling con 
cern to the international community. 

This afternoon — as was done at thii" 
consultation last year — I once again re- 
affirm that we are ready to resume dis- 
cussions with the Government of the 
Socialist Republic of Vietnam on this 
important issue. Our humanitarian goal 
must be to develop ways to receive 
these prisoners or former prisoners and 
their immediate families who wish to bei 
resettled in the United States. We are 
hopeful that the cooperative spirit re- 
flected in the recent resumption of the 
Orderly Departure Program and 
Amerasian Program will now manifest 
itself in addressing this profound, unre- 
solved humanitarian issue. 

In a special act of amnesty, the 
Vietnamese authorities recently an- 
nounced the release of 480 persons 
from "reeducation" camps — persons 
who had been incarcerated since 1975 
and who held positions under the for- 1 
mer government. We appreciate, ap- 
plaud, and welcome this humane 
gesture of amnesty by Vietnam. We in- 
vite the Vietnamese authorities to allow 
any of this group who wish to be reset- 
tled in the United States or in any 
other country to be accorded priority in 
the ODP on special humanitarian 
grounds. We also reaffirm our request 
that all former "reeducation camp" pris- 
oners be allowed unhindered access to 
the Orderly Departure Program. 

Conclusion 

This year's international meeting is a 
significant consultation. My delegation 
is looking forward very much to con- 
tinuing consideration of this very 
important humanitarian undertaking 
in meetings tomorrow with the 
Vietnamese delegation led by Vice 
Minister Co. ■ ; 



60 



Department of State BulletinJ 



'lERRORISM 



terrorism: Myths and Reality 



L. Paul Bremer, III 

Address before the Nonvegian At- 
itic Committee in Oslo on February 
1988. Ambassador Bremer is Ambas- 
ior at Large for Counter-Terrorism. 

e impact of terrorism has spawned a 
ge volume of literature and commen- 
•y. There are scores of self-styled ex- 
rts and consultants. Analyzing and 
plaining terrorism has become a 
owth industry. 

Of course, we should try to under- 
md terrorism. But much of what has 
en written and said about terrorism 
created a mythology which instead 
s served to confound the public and, 
I some cases, to romanticize ter- 
rists. If we are to have a sound coun- 
rterrorism policy we must know the 
hts. 

Three myths, in particular, confuse 
linking about terrorism. 

• Solve the "underlying problems" 
d terrorism will cease. 

• Terrorists are crazy. 

• Vigorous action against terrorism 
ily increases it. 

Today I will address these myths 
d tell you about the American Gov- 
nment's strategy for countering 
rrorism. 

yth One: Solve the Underlying 
-oblems and Terrorism Will Cease 

lO often terrorist acts are followed by 
lilt-ridden responses which begin by 
linting out the wrongs done to the 
rrorists and end by declaring that 
lere is no solution until the "underly- 
ig problem" is solved. This argument, 
"ten made by well-intentioned people, 
osely parallels the line of reasoning 
at forward by terrorists. Stripped of 
lossy phrases, the terrorists' argu- 
lent goes something like this: 

• Had we been treated justly, there 
ould be no violence. 

• We seek justice. 

• Whatever we do in pursuit of jus- 
ce is, therefore, justified. 

This line of reasoning is not only 
rrogant — leaving the judgment of 
ght and wrong to the terrorists — but 
nsupported by the facts. Let us exam- 
le some cases. 



Again and again, terrorist attacks 
in the Middle East have been specifi- 
cally designed to derail progress in 
dealing with the region's deep 
problems. 

• In 1948, UN mediator Count Ber- 
nadotte was assassinated as he worked 
on a cease-fire during Israel's war for 
independence. 

• In the early 1950s, King Abdallah 
of Jordan was assassinated in part be- 
cause of his talks with Israel. 

• In 1974, while then-Secretary of 
State Kissinger was negotiating a dis- 
engagement agreement on the Golan 
Heights, Palestinian terrorists seized 
and killed 32 Israeli school children in 
the town of Ma'alot. 

• President Anwar Sadat was as- 
sassinated in large part because he 
made peace with Israel. 

• In 1983, the Abu Nidal Organiza- 
tion (ANO) — at the urging of Syria — 
conducted a series of attacks against 
Jordanian interests when Jordan 
seemed to be taking a more moderate 
approach to a Middle East settlement. 

It is not just in the Middle East 
that terrorism has increased as under- 
lying problems are dealt with. 

• Basque terrorism in Spain has 
dramatically increased as its demands 
for Basque autonomy have been real- 
ized. In 1975, the year Franco died, 
Basque terrorists killed 16 Spaniards. 
Five years later, after the implementa- 
tion of democratic rule in Spain and the 
granting of significant autonomy in the 
Basque region, Basque terrorists killed 
96 Spaniards — a sixfold increase. 

• In Turkey, Kurdish terrorists, in 
addition to kidnapping and murdering 
Kurdish village guards and headmen, 
have attacked bridges, roadbuilding 
equipment, and other elements of an 
economic infrastructure which was im- 
proving conditions for impoverished 
Kurds in southeast Turkey. 

Terrorism occurs in the most free 
and just societies ever known to 
mankind. 

• In the Federal Republic of Ger- 
many, the Badder-Meinhof gang and 
the Red Army Faction have practiced 
terror France has been beset by the 
terrorism of the Direct Action group. 
Terrorists have also been active in 
other democratic, free countries — 
Belgium, Italy, Canada, and Japan. 



• In the United States, there have 
been terrorist actions by the Weath- 
ermen, the Order, the Aryan Broth- 
erhood, and the Symbionese People's 
Liberation Army. 

Individuals frequently join groups 
because of a need to "belong." More- 
over, it is not at all clear that terrorists 
themselves are motivated by a desire to 
solve underlying problems. In fact, re- 
cent psychiatric research makes it clear 
that many individual terrorists are not 
motivated by their so-called cause. For 
example, Dr. Jerrold M. Post of George 
Washington University concludes that 
the "cause" is not the fundamental rea- 
son most terrorists join up. The "cause" 
provides the rationale, but the moti- 
vation is the terrorist's desire to belong 
to a group. 

Social isolation and personal failure 
are frequently seen in preterrorist his- 
tories. Studies in Italy and Germany 
have shown that members of the Red 
Army Faction and the Red Brigades of- 
ten came from incomplete family struc- 
tures and had shown a high frequency 
of educational and job failure. Fully a 
third had been convicted in juvenile 
court before they joined a terrorist 
group. While the leadership remains 
focused on the political goal, many of 
the rank and file join not out of deep 
ideological commitment to a "cause" 
but because the terrorist group, in ef- 
fect, offers a "home," a "family." 

Another example of this phe- 
nomenon is found in the Basque ETA 
[Basque Fatherland and Freedom] or- 
ganization. In the Basque region, only 
8% of the population is from mixed 
Spanish-Basque heritage, and children 
from mixed marriages are not well ac- 
cepted in Basque society. Yet fully 40% 
of ETA members are from mixed 
heritage. 

Causes can be addressed without 
giving in to terrorism. Of course, we 
cannot and should not ignore underly- 
ing problems while we devote ourselves 
to countering terrorism. No country 
has done more to promote a peace set- 
tlement in the Middle East than the 
United States. We recognize the legiti- 
mate grievances of many groups, but 
nothing justifies terrorism. Recognizing 
a grievance does not require accepting 
terrorism as the solution. 

We do not have the luxury of 
choosing between policies which coun- 
ter terrorism and those which seek to 
resolve underlying issues. We must do 
both. 



ay 1988 



61 



TERRORISM 



Myth Two: Terrorists 
Are Suicidal Lunatics 

A second myth is that terrorists are 
crazy. A corollary is that they are will- 
ing to die for their cause, so arresting 
and imprisoning terrorists will have no 
deterrent effect. Both elements of this 
myth are incorrect. 

Most terrorists are not crazy. In 
fact, it is their sanity which makes 
them dangerous. They are calculating 
fanatics. They may use unstable people 
in their operations, but it is their abil- 
ity to calculate and plan which makes 
them dangerous. Terrorism is rarely 
"mindless." 

Nor does their distortion of good 
and evil make terrorists insane. Rus- 
sian terrorist Mikhail Bukanin put it 
this way: 

To the revolutionist, whatever aids the 
triumph of the revolution is ethical; all that 
hinders it is unethical and criminal. 



U.S. Signs Treaty on 
Maritime Security 



DEPARTMENT STATEMENT, 
MAR. 11, 19881 

In a significant display of international 
cooperation against terrorism, the 
United States and 22 other countries on 
March 10 signed an important new anti- 
terrorism treaty on maritime security. 
The treaty fills a gap in international 
law by ensuring that states will have 
jurisdiction to prosecute or extradite 
individuals who commit acts of ter- 
rorism on or against vessels on the high 
seas or elsewhere. A related protocol 
covers oil rigs or platforms anchored to 
the Continental Shelf and the people 
aboard them. Both were negotiated un- 
der the auspices of the International 
Maritime Organization (IMO), a spe- 
cialized agency of the United Nations. 

The need for such a treaty was 
highlighted by the 1985 attack on the 
cruise ship Achille Lauro and its pas- 
sengers. We regard this treaty as a ma- 
jor step forward in bringing the rule of 
law to bear against terrorists. This 
treaty, together with the recently 
signed protocol on aviation security and 
airport safety, will contribute to reduc- 
ing the vulnerability of travelers to 
terrorism. 



'Read to news correspondents by De- 
partment spokesman Charles Redman. ■ 



Let us look at a few examples. 

• The 1985 Rome and Vienna air- 
port massacres, carried out by the Abu 
Nidal Organization with Syrian and 
Libyan assistance, were not the work of 
lunatics. The attacks were not random 
but directed against the El Al counters. 
The purpose was to terrify El Al pas- 
sengers and travelers to Israel, thus 
weakening Israel's economy and 
"furthering the revolution." 

• Last October, the notorious Peru- 
vian terrorist group, Sendero Lumi- 
woso, occupied a small village in the 
Department of Ayacucho and captured 
eight members of the local civil defense 
force. After a mock trial, the villagers 
were tortured and beheaded. Such gro- 
tesque treatment of the very people 
whose support Sendero seeks might 
seem counterproductive. Actually, 

it is an example of "enforcement ter- 
rorism." The intention is to terrify the 
caynpesinos into supporting Sendero or, 
at a minimum, to prevent them from 
collaborating with the government in 
any way. 

• "Enforcement terrorism" is wide- 
spread in the Middle East. Most Pal- 
estinian terrorism over the years has 
been directed against rival Palestinians 
and other Arabs. For example, while 
the Abu Nidal Organization's goal is the 
destruction of the state of Israel, only 
14% of its attacks have been against 
Israeli or Jewish targets. Sixty-three 
percent of all attacks have been against 
Palestinian and Arab targets. Clearly, 
"enforcement" is a major goal for the 
ANO. And most of what they are en- 
forcing is a hard line against negotia- 
tion or accommodation with Israel. 

Few terrorist attacks are intended 
to end in the death of the terrorist. 
Spectacular bombings, such as those 
against the Marine barracks and the 
U.S. Embassy in Beirut have drawn at- 
tention to suicide attacks. Yet, in fact, 
very few terrorist attacks are deliber- 
ately suicidal. 

According to a study of terrorist 
missions between 1968 and 1974, less 
than 2% of all terrorist attacks are gen- 
uinely suicidal. In about a third of the 
cases, the terrorists were willing to die 
but preferred to live. In more than 60% 
of the cases, elaborate escape plans 
were made. In spite of prominent sui- 
cide attacks since that study, recent 
events do not suggest dramatic varia- 
tions in these figures. 

So terrorists make careful calcula- 
tions about their attacks. They intend 
to escape unharmed. Their rationality 
means that forceful action to deter ter- 



rorists can have a beneficial effect. Bi 
this brings us to the last of the myths 



jtks 
Myth Three: Forceful Action Againsi 
Terrorists Only Fuels Terrorism mi! 

It has been argued that jailing ter- 
rorists only leads to attacks to free 
them, that military action only leads t . 
counteraction. This is a myth, and a 
dangerous one, because it can paraly© 
us into inaction. The reality is that 
forceful action is a necessary element ; 
any successful response to terrorism 

By forceful action, I mean not jus^ 
military responses but aggressive law 
enforcement practices and stiff sen- 
tences when terrorists are convicted. 
Since the acts that terrorists commit-||Sii 
murder, arson, kidnapping, air piracy- 
are invariably crimes, the law is a tooli ,, 
for us to use. Yes, in the short run w( 
may face reprisals when we imprison 
terrorists. But over time, the rule of 
law will prevail. 

One of the reasons that we have s 
little domestic terrorism in the United il 
States is that the FBI [Federal Burea^t 
of Investigation] and the Justice De- 
partment have, for years, brought the 
full weight of the law to bear on organ 
zations like the Aryan Brotherhood an 
the Symbionese Liberation Army. 
Tough law enforcement measures in 
Europe, including stiff sentences for 
convicted terrorists in France, Spain, 
Italy, the Federal Republic of Germany, 
and the United Kingdom in the past 
year, coincide with a 40% decline in in- 
ternational terrorism there. 

But sometimes international real- 
ities limit the use of the law. Simply 
put, our writ did not run to Qadhafi's 
headquarters, so we turned to other ; 
means to defend ourselves. ' 

Here too, many people fell victim 
to the myth that forceful action in- 
creases terrorism. For example, a day 
after the U.S. strike on Libya on 
April 15, 1986, 97 Western terrorism 
experts meeting at a seminar in Aber- 
deen, Scotland, unanimously agreed 
that the United States had committed 
an error. Neither the morality of nor 
the justification for the strike was at 
issue; efficacy was. The experts' view 
was that the air strike would just stim- 
ulate Qadhafi to more terrorism. 

These experts were dead wrong. 
We believe that as many as 35 attacks 
planned by Libya were averted within 
weeks after the attack. Yes, Qadhafi 
still practices terrorism. And he con- 
tinues to assassinate his dissidents 
abroad. Recently, he was caught in Oc- 
tober trying to ship 150 tons of arms to 



62 



Department of State Bulletin^ 



TERRORISM 



IRA [Irish Republican Army]. But 
ihafi clearly reduced his planning for 
acks on us after the bombing. 
\ Moreover, military actions have 
limilitary consequences far removed 
|m the scene. While some friendly 
I'ernments questioned the wisdom of 
r limited attack, the message of U.S. 
lolve was unequivocal and as surely 
ierstood in Western capitals as in 
rorist training camps. Overall, there 
s a dramatic drop in Middle East- 
msored terrorism in Europe follow- 
■ our Libya attack and the accom- 
liying diplomatic and political 
lasures we and our allies took. 

B. Counterterrorism Policy 

[sed on our understanding of the real 
I eat we face, the American Govern- 
I nt has fashioned a three-part policy 
liigned to suppress terrorism. 

Firmness Toward Terrorists. We 

I ieve that terrorists are logical and 
|il oriented. For them, terrorism is a 
I tic, a means pursued to an end. 

You cannot permit terrorism to be- 
I ne a profitable tactic unless you want 
i.re of it. Behavior rewarded is behav- 
r repeated. That is why we must not 
i.ke concessions to terrorists. Yes, we 
; 11 talk to terrorists. We will talk to 
iyone, anywhere, anytime, about the 
s ety and well-being of American cit- 
1 ns'. But since our goal is to prevent 
1-ther terrorist acts, we will not 
jange our policies, pay ransom, re- 
lise prisoners, or engage in other be- 
I vior which might encourage further 
ics of terrorism. 

Pressure on Terror-Supporting 
ates. The second element of our 
-ategy is to bring pressure to bear 
states which sponsor terrorism, 
irough a marriage of convenience, 
ates can provide to terrorists impor- 
nt resources — weapons, financing, 
fe houses, training areas. On the 
her hand, terrorists can conduct out- 
Af activities on behalf of their state 
lonsors. The state sponsors can then 
i!ny any role in actions which could 
(ad to war if undertaken openly. It has 
l^en an important objective of U.S. 
)licy to try to break this nexus. 

The first state to feel the pressure 
I American policy was Libya. Over a 
briod of 5 years, the United States led 
|i international campaign to put pohti- 
d and economic and diplomatic pres- 
ire on Libya to persuade Qadhafi to 
op his terrorist ways. Our peaceful 
ensures did not succeed. And, in the 
id, when the President had convincing 



evidence of Libyan involvement in the 
attack on the La Belle disco in Beriin, 
he ordered a limited military attack on 
Libya in an attempt to dampen Colonel 
Qadhafi's enthusiasm for terrorism. 

The American bombing raid repre- 
sented a watershed in the international 
fight against terrorism. It shocked 
Qadhafi and other terrorists to realize 
that the United States was prepared to 
use military action, if necessary, to 
stop terrorism. 

In late 1986, courts in London and 
Berlin found Syrian complicity in ter- 
rorist attacks in those cities. The 
United States joined with Great Britain 
in an international campaign to pres- 
sure Syria into reducing its connections 
with terrorist groups. These measures 
also succeeded. In June last year, Syria 
expelled the notorious Abu Nidal group 
from Syrian territory. 

Iran, too, is a key supporter of ter- 
rorism. Its government has practiced 
terrorism ever since coming to power 8 
years ago. Iran has been responsible 
for attacks on U.S. targets, on French 
and British interests, and on moderate 
Arabs. Our government has imposed a 
series of tight sanctions on Iran and 
encourages other governments to do 
the same. 

When the evidence of North 
Korea's involvement in the destruction 
of KAL [Korean Air Lines] Flight 858 
became available, the United States 
quickly designated North Korea as a 
terrorist state. We are currently work- 
ing with other governments to be sure 
that the North Koreans understand 
that practicing terrorism is unaccept- 
able behavior. 

A Program of Action to Bring 
Terrorists to Justice. In spite of 
myths, we know that most terrorists 
are not eager to be killed or im- 
prisoned. So if we can identify, track, 
arrest, and punish terrorists — treat 
them like criminals — we can reduce the 
number of terrorist attacks. 

International cooperation has 
proven important here. The "watch 
lists" we have developed are in the 
hands of border police in many coun- 
tries. Border police are becoming much 
more attentive to suspicious travelers, 
too. As a result, terrorists run consid- 
erable risks crossing international bor- 
ders. In January 1987; two Lebanese 
terrorists were arrested on successive 
days trying to smuggle explosives into 
Italy and Germany. 

Because of increased attention to 
terrorism by Western governments, ter- 
rorist groups can no longer be sure 
they have not been penetrated by West- 



ern intelligence agencies. Contrary to 
what terrorist leaders may think, many 
of their operatives are, indeed, inter- 
ested in our money. 

And as countries dedicate more re- 
sources to the fight against terrorism, 
they are catching and prosecuting in- 
creasing numbers of international 
terrorists. 

• In Paris, Georges Ibrahim Ab- 
dallah received a life sentence for his 
role in the murders of a U.S. Army 
attache and an Israeli diplomat. 

• In Germany, a Lebanese terrorist 
named Hamadei faces air piracy and 
murder charges for his role in the TWA 
847 hijacking. 

• In New York City, Mohammed 
Atta, an Abu Nidal terrorist, awaits 
extradition to Israel to face murder 
charges arising from fire bombing and 
machinegunning of a bus. 

• In Washington, D.C., a Lebanese 
terrorist named Fawaz Younis awaits 
trial on hostage-taking charges arising 
from the hijacking of Jordanian Airlines 
Flight 401 in June 1985. 

More and more, civilized nations 
are coming to share our view that ter- 
rorism is a common menace and we 
must respond with a common dedica- 
tion to the rule of law. 

Conclusion 

Our strategy is working. In 1983 and 
1984, international terrorism increased 
30%-40% each year. In the past 3 
years, incidents of international ter- 
rorism have stabilized at about the 
same level — still too high, but at least 
the geometric expansions of prior years 
have ended. 

Why these improvements? Because 
the international political and philo- 
sophical climate is changing. Govern- 
ments which used to tolerate terrorists 
have become tougher More and more, 
we are seeing world debate focusing on 
the criminal effects of terrorism, not 
the "causes." 

But I don't want to mislead you. 
Deahng with terrorism is a long-term 
project. We are not likely to eliminate 
terrorism completely. But by de- 
mythologizing it, by dealing with real- 
ities and concentrating on common 
sense responses, we can set about the 
business of making the world a safer 
place. ■ 



63 



TERRORISM 



! 



U.S. Condemns North Korean Terrorism 



statements by Ambassador 
Clayton C. McManaway, Deputy to the 
Ambassador at Large for Counter- 
Terrorism, and William Clark, Jr., 
Deputy Assistant Secretary for East 
Asian and Pacific Affairs, before the 
Subcommittee on Asian and Pacific Af- 
fairs of the House Foreign Affairs Com- 
mittee on February i, 1988 J 

AMBASSADOR McMANAWAY 

I am a deputy in the State Depart- 
ment's Office of the Ambassador at 
Large for Counter- Terrorism, which is 
responsible for interagency pohey for- 
mation and coordination on matters 
concerning international terrorism. I 
will address our government's view of 
the evidence linking North Korea to the 
destruction of KAL [Korean Air Lines] 
Flight 858 and the steps we are taking 
in response. I will outline why we are 
convinced that North Korea was re- 
sponsible for this terrorist attack; what 
actions the United States has taken so 
far to register our outrage and concern; 
and some of the actions we are con- 
templating — in consultation with the 
Republic of Korea (R.O.K.) — to encour- 
age the international community to con- 
demn this mass murder of 115 innocent 
air passengers. Our aim is to deter 
North Korea from future terrorism. 
Countering state-supported ter- 
rorism is fundamental to our counter- 
terrorism policy. We, therefore, take 
action to condemn and punish, when- 
ever possible, any state which supports 
attacks on civil aviation or other acts of 
terrorism. Given North Korea's record 
of egregious violence against South 
Korea, however, we think it especially 
important that all civilized countries 
make it clear to North Korea that its 
murderous behavior must never be re- 
peated. Should the world prove indif- 
ferent, we fear that North Korea will 
conclude that terrorism is cost free and 
conduct further atrocities against inno- 
cent South Korean citizens. Such ac- 
tions could make the Korean Peninsula 
dangerously unstable. 

The Evidence 

I believe you have seen the white paper 
issued by the Republic of Korea on the 
destruction of KAL 858. After careful 
review, we have concluded that it con- 
tains compelling evidence that North 
Korea planned, organized, and carried 



64 



out this act of terrorism. The Korean 
white paper details the confession of 
Ms. Kim Hyon-hui. Highly trained, 
Korean-speaking U.S. officials have met 
with her and believe she is telling the 
truth. 

We offer the following additional 
facts, which we believe confirm her 
story. 

• North Korean agents have used 
suicide capsules when captured in the 
past. More importantly, technical analy- 
sis shows the cyanide capsule (taken 
from Ms. Kim) to be chemically identi- 
cal to those found on North Korean 
agents captured in earlier incidents. 

• According to a public Japanese 
statement, the documents needed to 
produce the forged Japanese passport 
used by Mr. Kim were obtained by an 
individual wanted in Japan as a North 
Korean agent. 

• U.S. experts have concluded that 
the forged passports are of such high 
quality that they were almost certainly 
prepared by a government intelligence 
service. No terrorist group is known to 
have the capability to produce forgeries 
of this quality. 

• We know from non-Korean 
sources that Ms. Kim and her compan- 
ion traveled with coded phone numbers 
of North Korean missions in Vienna and 
Belgrade. 

• As part of her cover, Ms. Kim 
initially spoke Japanese and denied she 
was a Korean. However, in her subse- 
quent public and private appearances, 
she spoke fluent Korean vdth a North 
Korean accent. 

• Finally, U.S. officials showed Ms. 
Kim a large selection of photographs of 
individuals and asked her to identify 
any who had played roles in the KAL 
858 bombing. She identified two men 
known to the United States as North 
Korean agents. One of them, Han Song- 
sam, was a North Korean official sta- 
tioned in Budapest. Ms. Kim said she 
and Mr. Kim stayed with Han while in 
Budapest. The description she provided 
of his house matched that of U.S. Gov- 
ernment officials who have seen it. The 
other was Yi Yong-hyok, the man she 
said gave her the order to bomb the 
airliner 

We have no doubt that North 
Korea is responsible for this act of mass 
murder. 



How the Bombing 
Was Carried Out 

This terrorist act was not launched 
overnight. It took careful planning, in- 
tensive training and indoctrination for 
the two operatives, and coordination 
and support from North Korean diplo- 
matic missions abroad. 

Ms. Kim has detailed her training 
as a covert agent, beginning in 1980. 
She has said that she and her accom- 
plice, Kim Sung-il, began to train in 
1984 for missions against the 1988 Seoi 
Olympics. After receiving the order tc 
bomb KAL 858 in October 1987, she 
and her partner received specialized 
training in the use of e.xplosives. 

Ms. Kim and the other operative 
began their trip last November 12 wh( 
they left Pyongyang for Moscow accon 
panied by two North Korean intel- 
ligence officers. They then traveled to 
Budapest, Vienna, and Belgrade. In 
Belgrade, they were given the bomb b 
a North Korean official. It was con- 
cealed in a portable radio with addi- 
tional liquid explosive concealed in a 
wine bottle. From Belgrade, the pair 
flew to Baghdad aboard an Iraqi Air 
flight. 

In Baghdad, they transferred to 
KAL Flight 858. The agents left the 
bomb aboard the plane when they got 
off in Abu Dhabi. When the plane dis- 
appeared while approaching Bangkok, 
an urgent search was begun for the 
passengers who had deplaned at Abu 
Dhabi. The two were tracked to 
Bahrain, where they were apprehende 
at the airport while awaiting a flight t 
Rome. It was at that point that Ms. 
Kim and her companion took cyanide. 
Her companion died, but Ms. Kim sur 
vived with medical treatment. 

I believe you have received a full 
briefing in closed sessions on still clas 
sified information, so I will move on a1 
this point to what we have done to 
bring North Korea to account for this 
despicable act. 

U.S. Actions to Date 

As soon as we were satisfied at North 
Korean culpability, the United States 
announced the following steps. 

• The Secretary of State desig- 
nated North Korea as a state sponsor 
terrorism under Section 6(j) of the Ex 
port Administration Act and notified 
the Secretary of Commerce of this ac- 
tion. Congress was also notified as par 
of the Commerce Department's report 
on exports controlled for foreign polio; 



npnartmpnt nf Qtato RiiIIqIi. 



TERRORISM 



• The Department of State tight- 
led its already strict visa regime on 
;orth Korean passport holders. 

• The Department of State with- 
.ew its earlier authorization, issued 
St .March, which allowed U.S. diplo- 
ats to hold substantive communica- 
ans with North Korean diplomats in 
?utral settings. 

We have also called on all nations 
I condemn North Korea for this action 
id encouraged individual countries to 
lopt appropriate measures, including 
msideration of economic and other 
inctions. 



nternational Response 

he response to date by other govern- 
lents has been mixed. A number of 
ountries, including Japan, Denmark, 
Sngapore, and the Netherlands, have 
sued strong statements condemning 
oth the bombing and North Korea's 
esponsibility for it. Japan has also an- 
ounced its intention to impose sanc- 
ons on the D.P.R.K. [Democratic 
'eople's Republic of Korea]. Inter- 
stingly, the RR.C. [People's Republic 
f China], despite its close relations 
/ith North Korea, printed both North 
nd South Korean versions of the ind- 
ent in official media. 

Others have issued cautious state- 
nents saying, in effect, that they want 
hear the South Korean charges de- 
lated further before reaching final con- 
lusions. The European Community, for 
example, condemned the bombing as an 
ict of terrorism but stopped short of 
laming North Korea specifically as the 
;ulprit. We have urged governments to 
ssue statements clearly condemning 
Doth the terrorist act and North 
Korea's responsibility for it, taking into 
iccount both the South Korean white 
Daper and other available evidence. 

I also understand that considera- 
;ion is being given by the International 
federation of Airline Pilots Associa- 
;ions as to whether to declare North 
Korea an "offending state," a step 
ivhich could lead to sanctions by that 
Dody. 

B\iture Actions 

We are consulting with the R.O.K. re- 
a;arding additional measures. I would 
anticipate that they would include: 

• Urging international organiza- 
tions to take action on this issue. We 



believe the KAL case should be raised 
in the United Nations and the Interna- 
tional Civil Aviation Organization. The 
South Korean Government is currently 
deciding when and how they intend to 
raise the issue in those bodies and what 
action they intend to request to be 
taken. We are consulting with them to 
coordinate our approaches and have in- 
dicated we are prepared to give them 
firm support; 

• Urging those with close relations 
with North Korea to use their influence 
in Pyongyang to curb further unaccept- 
able behavior; 

• Continuing to seek condemnation 
of North Korea by individual govern- 
ments for its terrorist attack; and 

• Assisting South Korea in security 
arrangements for the Seoul Olympic 
games. 

Implications for Aviation Safety 

I would also like to mention some of the 
steps we are taking in aviation security 
in general. While this particular act 
was aimed at South Korea, it is only by 
chance that none of our own citizens 
were aboard the flight. 

In the past 2 years, security at air- 
ports in Europe and other areas has 
improved. We are working on further 
improvements in three ways. 

First, we are cooperating with Eu- 
ropean and other governments to im- 
plement more rigorous passenger 
screening, tighter baggage checks, and 
other measures. 

Secondly, we are providing antiter- 
rorism assistance (ATA), including air- 
port security assistance, to govern- 
ments which request it. Currently, we 
operate ATA programs in some 40 
countries. 

Finally, we have supported the 
adoption of a new international conven- 
tion on airport security. This would 
amend the Montreal convention on sab- 
otage to include airports themselves as 
well as aircraft in flight. We hope that 
this will be adopted at a diplomatic con- 
ference which begins next week in 
Montreal. 

At the same time, we are working 
to improve our own ability to ensure 
that explosives and other weapons are 
detected before being brought onto air- 
planes. Certain types of explosives can 
only be detected by a rigorous hand 
search. Through the interagency coun- 
terterrorism research and development 
program chaired by the State Depart- 
ment, we are developing new technolo- 
gies to detect them mechanically. 



I would like to make special men- 
tion of our work with the R.O.K. to 
make the Seoul Olympics as safe as 
possible from terrorism. Given the hor- 
ror of the 1972 Olympics in Munich and 
North Korea's demonstrated willingness 
to use terrorism against the South, our 
efforts have already begun and will be 
intensive. While this forum is not ap- 
propriate to go into detail, I can say 
that the Department of State and our 
embassy in Seoul are coordinating the 
efforts of seven other U.S. agencies. I 
am pleased that in the aftermath of the 
KAL 858 bombing, Japan has an- 
nounced that it, too, will assist the Re- 
public of Korea on Olympic security. 

In closing, I wish to emphasize 
that we remain committed to support- 
ing the R.O.K.'s lead in bringing this 
matter before international forums and 
to the attention of other countries in 
seeking international condemnation of 
North Korea for this heinous act of in- 
ternational terrorism. At the same 
time, it is in our interest not only to 
support the R.O.K.'s intitiative but to 
strongly condemn and, where possible, 
punish North Korea for this action. 

The bombing of KAL 858 con- 
stitutes state-supported terrorism at its 
worst and is a danger to us all. It is 
essential that the civilized world do 
everything in its power to put an end to 
this threat. Our actions on KAL 858 
are consistent with, and should be seen 
as part of, our continuing struggle to 
counter international terrorism wher- 
ever it occurs. 



MR. CLARK 

Let me begin by thanking you for this 
opportunity to speak on a matter of se- 
rious concern, the terrorist bombing of 
flight KAL 858 on November 29, 1987. 
This brutal act of state terrorism de- 
stroyed 115 innocent lives. We deeply 
regret this tragic loss of life; we sym- 
pathize and share with those who lost 
family members their great sorrow and 
profound outrage. 

The destruction of KAL 858 is not 
simply a personal tragedy but reminds 
us vividly that we are engaged in a 
bitter global struggle against ter- 
rorism. It also reminds us that those 
who currently control North Korea re- 
peatedly ignore civilized rules of behav- 
ior; in fact, the Pyongyang regime 
seems to play by no rules at all. The 
history of North Korean savagery is 
long and bloody, going back as far as 
its unprovoked attack on the R.O.K. on 
June 25, 1950. It has continued — with- 
out cessation — to this very day. 



^'^" •"^»« 



65 



TERRORISM 



• In Rangoon, in 1983, North 
Korean commandos planted explosives 
which killed 17 members of the R.O.K. 
President's official party, as well as 4 
Burmese. 

• In 1976, North Korean soldiers 
axe-murdered two unarmed American 
officers at Panmunjom. 

• In 1974, North Korean agents, at- 
tempting to assassinate then-President 
Park, shot and killed his wife in Seoul. 

The year 1968 proved a banner year 
for North Korean unlawfulness: they in- 
tercepted, in international waters, the 
unarmed U.S.S. Pueblo, killing one of 
the crew and subjecting the rest to bru- 
tal torture; they shot down an unarmed 
U.S. military plane; and their comman- 
dos carried out the infamous "Blue 
House raid," nearly succeeding in as- 
sassinating President Park. North 
Korea also dispatched numerous com- 
mando units into South Korea in the 
late 1960s to savage and terrorize the 
South Korean populace. 

This is, of course, only half the 
story. North Korea continues to devote 
record levels of its scarce resources to 
its enormous military establishment. 
Defectors tell chilling tales of the sav- 
agery and paranoia of that regime. 
Koreans living above the demilitarized 
zone, in almost total isolation from con- 
tact with the civilized world, suffer a 
deprivation of basic freedoms virtually 
unparalleled anywhere else. They lack 
information, privacy, and truth; and, in- 
creasingly, they suffer shortages of food 
and other basic human needs. The re- 
gime in the North evokes the darkest 
memories of the horrors of fascist rule, 
with its Fuehrer prinzip (leader princi- 
ple); its military machine; and organs of 
control, terror, and repression. 

North Korea's Threat to Peace 

We have long been aware of the threat 
to peace posed by the North. Tradition- 
ally, we have countered this threat in 
two ways. 

Militarily, we maintain a strong al- 
liance with the R.O.K. , stationing U.S. 
troops in Korea to deter North Korean 
aggression and to provide the shield be- 
hind which our ally has developed eco- 
nomically and politically. 

Diplomatically, we have sought to 
contain or deflect North Korea's reck- 
less and brutal behavior as much as 
possible. 



This Korean act of sabotage and 
murder against KAL 858 occurred not 
against a backdrop of unremitting hos- 
tility; rather, it tore asunder the fabric 
of carefully woven offers of peaceful 
contact and the prospect of improved 
relations. As you know, the Interna- 
tional Olympic Committee, working 
closely with the Government of the Re- 
public of Korea, offered to the North 
the privilege of staging a number of 
events in the 1988 Seoul Olympics. That 
offer has no precedent in the history of 
the modern Olympics. Similarly, we and 
the R.O.K. Government worked to- 
gether to offer a series of small but 
concrete, achievable steps to stimulate 
tension reduction and understanding. 
We did so not in ignorance of 
Pyongyang's miserable record but in 
recognition that the North Korean state 
needs to open itself further to the 
world. We proceeded in the hope that 
Pyongyang's leaders would come to rec- 
ognize this need. We hoped they would 
act rationally, allowing the North to 
join the progress toward economic mod- 
ernization and democracy taking place 
in many other parts of Asia. 

Such steps could have led to a 
lessening of tension on the peninsula, 
an improved economic outlook for the 
faltering North Korean economy, and, 
perhaps, progress toward the peaceful 
reunification of the peninsula that 
Pyongyang claims to seek and that all 
Koreans long to achieve. 

What response did the North give 
to this olive branch? Their "messenger 
of peace" was a meticulously trained 
North Korean agent, Kim Hyon-hui, 
who freely and credibly confessed that 
high-level D.P.R.K. officials directed 
her key role in the destruction of KAL 
858. She claims — and we have every 
reason to believe her — that the 
D.P.R.K. directed this savagery against 
the 1988 Seoul Olympics. Certainly, the 
killing of 115 civilians 9 months before 
the commencement of the games would 
be insufficient to disrupt the games, 
but we must assume that the North 
intended to evade discovery. Had its 
agents escaped, had the cyanide ampule 
served its intended purpose, the world 
would miss the conclusive link to the 
North provided by her testimony and 
the opportunities that testimony has af- 
forded for independent corroboration. 
The North would then have been freer 
to implement further such actions. 



P 



m 



Economies of scale suggest that 
other agents have been trained by the 
North. We ask ourselves how many 
more "angels of death" the leadership 
in Pyongyang will dispatch into the 
world on missions of destruction before 
that state recognizes the folly of its pol 
icies? We do not know, but we must 
make clear that this once is too much. 
Ms. Kim's confession takes forever fror 
the North the remaining tatters of its 
cloak of "plausible deniability." The 
world will know where to point should 
Pyongyang attempt a bloody encore to 
KAL 858. 

Ms. Kim also stated that her train- j 
ers told her that "high-level officials" 
personally ordered the destruction of 
KAL 858 and had even reviewed opera 
tional details as well. Well schooled in 
how to interpret such statements, she 
drew the inference that Kim Chong-il 
may have personally directed her mis- 
sion and, at the time, was appropriate 
pleased and flattered. While we will 
most likely never obtain independent 
evidence directly linking the highest 
echelons of that regime to this act, hei 
belief certainly is credible. We know 
that in that dictatorial regime, the de- 
gree of personal direction by the Kims 
father and son, is unparalleled any- 
where else in the world. The two lead- 
ers provide supposedly expert "on-the- 
spot guidance" in areas as diverse as 
agriculture, industry, and military af- 
fairs. Thus, "on-the-spot guidance" for 
acts of terrorism, especially those as 
significant as the mission on which Ms 
Kim was dispatched, seem to me more 
than just plausible. Nonetheless, we 
note that president-elect Roh Tke Woo 
has remarked that this operation may < 
have been the work of a "rogue ele- '■ 
ment" within the D.P.R.K. No pos- 
sibility can be dismissed. | 

I 

Conclusion 

In closing, let me make three points, i 

First, our friend and ally, the Re- ' 
public of Korea, has shown remarkabl* 
restraint and statesmanship in the af- I 
termath of this act of terror: the 
R.O.K. Government canceled its initia 1 1 
tive allowing its officials to talk with ! ! 
North Korean officials, called upon 
other governments to condemn this in 
ternational act of lawlessness, and is 
actively considering other diplomatic 
measures. Of equal importance is whal f 
the R.O.K. Government has not done 



66 



non.rfm^nt nf Qt.to RnllotI 



UNITED NATIONS 



< iidt rescinded its offer to share 
111' of the Olympic events with the 
/iith. and it has not called for violent 
r aliation. The people and Government 
c South Korea have responded to this 
i ernational outrage with outrage, but 
s;o with restraint and dignity. We ap- 
jiud their prudence, objectivity, cour- 
se, and determination. 

Second, we — the entire world com- 
linity — must let the North know that 
I one can or will tolerate acts of state 
irrorism like the destruction of KAL 
!8; the North Korean leaders must un- 
I rstand that they have no alternative 
iit to abandon their confrontational 
; d murderous approach to interna- 
mal affairs. 

Finally, a word about the upcom- 
g Olympics: the North cannot be al- 
ived to disrupt them, whatever con- 
raints are required. While the 
imary security responsibility for the 
imes lies with the R.O.K. authorities, 
i are working closely with them to 
isure that the games are safe. We are 
■nvinced that the Seoul Olympiad will 
! one of the most successful Olympics 
nee their modern resurrection in 1896, 
true celebration of the international 
)mmunity, in which we still hope the 
orth will find it possible to participate 
)nstructively. Pyongyang need only 
Dandon its bloody and unproductive 
impaign of terror. 



U.S. Interests in the United Nations 



'The complete transcript of the hear- 
igs will be published by the committee 
nd will be available from the Super- 
itendent of Documents, If.S. Govern- 
lent Printing Office, Washington, D.C. 
0402. ■ 



by Vernon A. Walters 

Statement before the Subcommittees 
on Human Rights and International 
Organizations and on International Op- 
erations of the House Foreign Affairs 
Committee on February 25, 1988. Am- 
bassador Walters is U.S. Permanent 
Representative to the United Nations. 

I am delighted to have this opportunity 
to appear before members of the House 
Foreign Affairs Committee to address 
issues of importance to the United 
States. The United Nations is engaged 
in a major way on key foreign policy 
issues where there is a strong consen- 
sus in the United States: getting the 
Soviets out of Afghanistan and the 
Vietnamese out of Cambodia, bringing 
peace to the Persian Gulf and a settle- 
ment in Cyprus, and promoting respect 
for human rights and fundamental free- 
doms. These are issues that will remain 
high on our list of foreign policy pri- 
orities for the rest of this Administra- 
tion and beyond. 

Iran-Iraq War 

The United States has supported the 
UN Secretary General's intiative to 
form a coalition at the United Nations 
determined to bring an end to the war 
between Iran and Iraq. A major step 
was taken last year: Security Council 
Resolution 598— adopted with the sup- 
port of all Council members — not only 
orders the parties to end the war 
but defines the shared commitment of 
the international community to a 
settlement. 

Following the adoption of Resolu- 
tion 598, the Secretary General con- 
ducted intensive discussions, including 
two rounds of talks with Iran and Iraq, 
to seek agreement on ways and means 
to implement the resolution. While 
Iraq agreed to comply, Iran, despite 
deceptive signals to the contrary, has 
maintained its commitment to the path 
of war. In order to persuade Iran to 
comply with the resolution by agreeing 
to an immeditate cease-fire and with- 
drawal of its forces to the international 
frontier, the five permanent members 
of the Security Council are now actively 
working on a second resolution which 
would impose an arms embargo on 
Iran. The United States is urgently 
seeking passage of this resolution 



intended to enforce 598. Half mea- 
sures — such as the proposal for a UN 
naval force in the gulf — are not work- 
able. They would play into Iran's hands 
by addressing only one aspect of the 
conflict and by allowing the land war to 
continue unabated. 

Middle East 

Throughout most of 1987, deceptive 
calm prevailed at the United Nations 
with regard to the Arab-Israeli conflict. 
The Security Council was focusing its 
attention primarily on Iran-Iraq. All of 
this changed with the sudden outbreak 
of widespread violence in the occupied 
territories in late November. 

Between December 18 and Febru- 
ary 1, the Security Council was in al- 
most constant session on the occupied 
territories. Four separate resolutions 
were put to the vote. The United 
States supported one, abstained on 
two, and voted against the last resolu- 
tion. Though our votes were different, 
our goals were the same: reduction of 
tension in the occupied territories, Is- 
raeli compliance with the fourth Geneva 
convention, and movement toward an 
overall peace settlement in the region. 
We voted for the resolution which 
seemed to further this policy, abstained 
on those whose impact appeared ambig- 
uous, and voted against a resolution 
which would not have advanced those 
principles. 

The Administration is working at 
present with the parties in an effort to 
agree on the substantive principles 
which should govern direct negotiations 
as well as on the procedural aspects of 
such negotiations. We are addressing 
short-term problems in the occupied 
territories as well as an overall peace 
settlement. We need to remember two 
things: 

• The UN Security Council has 
played an important role on these is- 
sues by establishing Resolution 242 as 
the basis of all subsequent diplomatic 
effort; and 

• At some point, the United Na- 
tions, and particularly the Security 
Council, may again have an important 
role to play in guaranteeing a just and 
durable settlement. 



67 



UNITED NATIONS 



Afghanistan 

The United Nations has been working 
since 1982 to bring about a negotiated 
settlement in Afghanistan. UN-spon- 
sored talks have shown considerable 
progress, progress purchased with the 
blood of Afghan resistance fighters. At 
the same time, the political costs to 
them of continuing the occupation in 
the face of near-universal international 
disapproval also figure in Soviet cal- 
culations. Nine UN General Assembly 
resolutions, adopted with ever-increas- 
ing majorities since 1980, underline 
Moscow's isolation on this issue. 

I believe that the spotlight which 
the United Nations has focused on 
Afghanistan has played an important 
part in inspiring General Secretary 
Gorbachev's February 8 announcement. 
Gorbachev stated the Soviet Union's 
willingness to withdraw its forces over 
10 months starting on May 15, provided 
that an agreement can be reached at 
the Geneva negotiations by March 15. 

This announcement appears to have 
improved prospects for a settlement in 
Afghanistan. While important details 
remain to be worked out, we welcome 
Mr. Gorbachev's announcement as a 
positive sign of serious Soviet intent to 
withdraw from Afghanistan. The next 
big test will occur early next month 
when UN Under Secretary General Di- 
ego Cordovez undertakes a final round 
of negotiations with the Government of 
Pakistan and the Afghan regime in 
Geneva. 

42d UN General Assembly 

Let me turn to some of the most impor- 
tant developments at the 42d session of 
the General Assembly. Overall, U.S. in- 
terests advanced on several fronts in 
spite of massive withholding of our as- 
sessed contributions. 

• Overwhelming record majorities 
demanded the withdrawal of foreign 
forces from Afghanistan and Cambodia 
despite strenuous efforts by the Soviet 
Union and Vietnam to gain support for 
their positions. 

• Seventy-nine other member 
states — a record — voted with the 
United States to reject an effort to bar 
Israel from the General Assembly. 

• U.S. -supported resolutions criti- 
cizing human rights abuses in Iran and 
Afghanistan obtained larger margins of 
support this year than ever before. 

• Resolutions on human rights in 
Chile and El Salvador were more bal- 
anced than in past years, and the 



-SB- 



United States repeatedly criticized 
Cuba's deplorable human rights record. 

• Important resolutions adopted by 
consensus included those uniting all 
countries in an effort to prevent and 
control AIDS [acquired immune defi- 
ciency syndrome] and strengthening in- 
ternational cooperation in the war on 
drugs through preparation of a draft 
convention against illicit traffic. The 
resolution on AIDS explicitly recog- 
nized that AIDS is a naturally occur- 
ring virus, countering Soviet propa- 
ganda that U.S. biological warfare was 
behind the epidemic. 

• Protracted U.S. diplomatic 
efforts resulted in the near disap- 
pearance of expHcit critical references 
to the United States — that is, name- 
calling — from General Assembly resolu- 
tions relating to apartheid and the Mid- 
dle East. There was no name-calling in 
any of the Nambia resolutions. 

• The United States and other 
Western countries defanged and then 
eroded support for the major Soviet ini- 
tiative on international security, a 
vaguely worded but pernicious attempt 
to rewrite the UN Charter under the 
guise of a new "comprehensive system 
of international security." 

Of course, there were disappoint- 
ments as well. The General Assembly 
criticized the U.S. trade embargo 
against Nicaragua in a resolution seek- 
ing to isolate the embargo from the 
broader issues of Central America. It 
also adopted a Nicarguan-sponsored 
resolution demanding U.S. compliance 
with the International Court of Justice 
ruling on Nicaragua. 

We were not able to obtain a reso- 
lution that we could support on the ex- 
ternal debt of the developing countries. 
We withdrew our draft resolution on 
periodic free elections to avoid an im- 
plicit attack upon Israel. 

While the assembly's resolution un- 
equivocally reaffirming its condemna- 
tion of terroism met our principal 
objectives, it contained some language 
on self-determination susceptible to 
harmful misinterpretation. We voted 
aginst it. 

Finally, the West found httle sup- 
port for its opposition to resolutions en- 
couraging armed struggle in South 
Africa and designating SWAPO [South 
West Africa People's Organization] as 
the "sole and authentic representative 
of the Namibian people." 



UN Voting 

You will soon be receiving my annual 
report to the Congress on voting prac- 
tices in the United Nations. I have seri- 



ous reservations about the methodolog 
used to measure coincidence of voting 
with the United States. That meth- 
odolgy, for example, does not ade- 
quately reflect the 56.4% voting 
coincidence with the United States on 
the 10 key issues at the 42d General 
Assembly. Nor does it take into ac- 
count that 55% of all resolutions were 
adopted by consensus last year, up to 
176 resolutions from 159 at the 41st 
General Assembly. This reflects an in- 
creasing tendency to work out agree- 
ments which are not acceptable to all 
members. Vote tallies alone are not si 
ficient to measure the results of the 
General Assembly. The increased coop 
eration, reduced rhetoric, and behind- 
the-scenes help which characterized tl 
42d General Assembly are difficult to 
capture in statistics. 

UN Reform 

An issue of paramount importance to 
the United States is the progress of 
administrative and budgetary reform. 
The reform movement started with di 
satisfaction voiced by the United Stat 
and other countries over the way UN 
funds were spent and the rapid growl 
of the UN budget in the late 1970s an 
early 1980s. A perception arose that 
"those who have the votes don't pay t 
bills, and those who pay the bills don 
have the votes." The Congress passec 
the Kassebaum-Solomon amendment 
1985, calling for the withholding of 20 
of our UN assessment until the Unite 
States and other donors were given a 
say over UN spending proportional t( 
their contributions. 

In response to this and other 
strong signals from major donors, th( 
United Nations established a group o 
experts, the Group of 18, which work 
during much of 1986 and proposed mc 
than 70 recommendations for admin- 
istrative and budgetary changes. At t 
1986 General Assembly, member cour 
tries accepted most of these recomme 
dations. The General Assembly also 
modified the budget process to includ 
consensus approval of the overall func 
ing level before the detailed budget is 
prepared. This procedure, in effect 
gives each country a veto over UN 
spending and satisfies the intent of ti 
original Kassebaum-Solomon amend 
ment. UN member countries under- 
stood that this budget reform would i 
followed by a return by the United 
States to full payment of our 
assessment. 

The implementation of the admin 
istrative and budgetary reforms has 



n.^r^-^rt.^^r^» /^« C<-^♦^ p..ll^h : 



WESTERN HEMISPHERE 



ixed, but substantial progress 
urred in some areas. On the ad- 
riiisirative side, the Secretary Gen- 
^il has reduced UN professional staff 
3; almost the full 15% targeted for a 3- 
fl.r period ending in 1989, and the re- 
1 -tinns in clerical and support staff 
I also well along. The United Nations 

I also reorganized a number of major 
i )artnients to eliminate duplication 

I I to increase efficiency and has re- 

1 'etl e.xpenses for staff travel and con- 
jtants by some 30%. The staff cuts 
li other economies allowed the Gen- 
? 1 .Assembly to adopt in December, 
;i the first time in UN history, a bud- 
j for the next 2 years that is smaller 
real terms than its predecessor. 

A key disappointment in the area 
: reform is the inabihty of the UN's 
. niniittee for Program and Coordina- 
: n to agree on a budget ceiling and a 
. itiiiKency fund for the 1988-89 bud- 
1 .. While the new process will begin 
er this year with the outline for 
JO-91, we had hoped to accelerate the 
locess by a year. I must admit that 
-3 U.S. failure to pay even half of our 
^ dues last year made other coun- 
es unwilling to move the new process 
•ward. The initial shock of our with- 
Iding created the impetus for reform, 
t reforms are unlikely to take full 
cect in an organization paralyzed by 
lancial instability. 

As members of the committee are 
/are, the President must determine 
at three specific aspects of the re- 
rms are proceeding acceptably before 
ly additional FY 1988 funds can be 
sbursed to the United Nations. The 
cecutive branch is currently reviewing 
lose three areas and will report to the 
ongress in the coming weeks. I have 
ready touched briefly on two of them, 
16 staff cuts and the new budget proc- 
)S, and I should also say a word about 
16 third, the topic of seconded staff. 

Secondment refers to a practice by 
hich governments "lend" their na- 
onals to work at the United Nations 
ir fixed periods of time. The Soviet 
nion and other East European coun- 
ies have, since the UN's beginning 
id even before that time, seconded al- 
lost all of their nationals who work for 
iternational organizations. We believe 
lat this contravenes the idea, embod- 
d in the UN Charter, of an independ- 
it international civil service whose 
rst loyalty should be to the organiza- 
on. The practice, however, is not one 
lat can be changed overnight, because 
lany countries believe that the General 
ssembly should not dictate to member 



states the conditions under which their 
nationals must serve in the Secretariat. 
There are, however, signs of tangible 
change in the approach of the Soviet 
Union to this subject, and we will be 
reporting on such progress in connec- 
tion with the presidential determination 
mentioned above. 

Conclusion 

In conclusion, let me say that if the 
United States intends to use the United 
Nations as a serious arm of our foreign 
poHcy in Iran/Iraq, the Middle East, 
Afghanistan, and other areas, we must 
treat it as a serious institution. We can 
not continue to neglect our financial 
commitments to the United Nations 
and then expect that our opinions, pol- 
icies, and positions will carry their for- 
mer weight in the world body. The 
United Nations is not a perfect organi- 
zation, politically or administratively, 
from the U.S. perspective, nor vnll it 



Events in Panama 



WHITE HOUSE STATEMENT, 
FEB. 25, 19881 

We understand that President Delvalle 
today dismissed Gen. Noriega from his 
position as Commander of the Panama 
Defense Forces. At this time, we want 
to reiterate our unqualified support for 
civihan constitutional rule in Panama. 
There is but one legitimate sovereign 
authority in Panama and that is the 
Panamanian people exercising their 
democratic right to vote and elect their 
leadership in a free society. 



WHITE HOUSE STATEMENT, 
FEB. 26, 19881 

We condemn all efforts to perpetuate 
military rule in Panama, including 
efforts to remove President Delvalle 
from office. We want to reiterate our 
unqualified support for civilian con- 
stitutional rule in Panama. There is but 
one legitimate sovereign authority in 
Panama and that is the Panamanian 
people exercising their democratic right 
to vote and elect their leadership in a 
free society. We have also initiated a 
series of consultations to learn the 
views of other countries in the hemi- 
sphere with regard to this situation. 



ever be. After all, the world is hardly a 
perfect place, so the United Nations 
can hardly be otherwise. It is the orga- 
nization of 159 independent countries 
who gather to discuss problems and is- 
sues of common concern. We must work 
to improve the way it serves our needs, 
but with realistic expectations for the 
results that will be achieved. I assure 
all members of these subcommittees 
that, so long as I am your represent- 
ative to the United Nations, we will 
continue to press hard for U.S. objec- 
tives, on reform issues as well as politi- 
cal issues, with the overall goal of 
advancing U.S. foreign policy interests 
in the world body. 



'The complete transcript of the 
hearings will be published by the com- 
mittee and will be available from the 
Superintendent of Documents, U.S. 
Government Printing Office, Washington, 
D.C. 20402. ■ 



WHITE HOUSE STATEMENT, 
MAR. 3, 19882 

The United States welcomes the state- 
ments issued by President Delvalle, 
Vice President Esquivel, and the politi- 
cal parties and National Civic Crusade 
of Panama favoring a government of na- 
tional reconciliation. This is a blueprint 
for progress toward democracy in Pan- 
ama. We support their goal of restoring 
democratic government and civilian 
constitutional order. Once this goal has 
been achieved, we will work cooper- 
atively with the Government of Panama 
toward the recovery of Panama's finan- 
cial and economic health. The United 
States remains committed to fulfilling 
its Panama Canal Treaty obligations, 
and we are prepared to resume working 
with the Panamanian Defense Forces 
under the treaty once civilian rule and 
constitutional democracy are 
established. 

WHITE HOUSE STATEMENT, 
MAR. 8, 19882 

The United States welcomes the state- 
ments issued by President Delvalle, 
Vice President Esquivel, and the politi- 



aviQRR 



69 



WESTERN HEMISPHERE 



cal parties and [National] Civic 
Crusade of Panama favoring a govern- 
ment of national reconciliation. This is a 
blueprint for progress toward democ- 
racy in Panama. We support their goal 
of restoring democratic government and 
civilian constitutional order. Once this 
goal has been achieved, we will work 
cooperatively with the Government of 
Panama toward the recovery of Pan- 
ama's financial and economic health. 
The United States remains committed 
to fulfilling its Panama Canal treaty ob- 
ligations, and we are prepared to re- 
sume working with the Panamanian 
Defense Forces under the treaty once 
civilian rule and constitutional democ- 
racy are established. 



ASSISTANT SECRETARY ABRAMS' 

STATEMENT, 
MAR. 10, 19883 

Today, as you know, Panama faces a po- 
litical crisis with roots in charges of 
official corruption, fraud, undemocratic 
practices, and, most recently, of illegal 
involvement in narcotics trafficking and 
related criminal activities. 

We believe these problems can only 
be resolved by supporting civilian con- 
stitutional rule and the legitimate 
Delvalle government. 

Recent Developments 

Allow me to summarize recent 
developments. 

On February 25, President Eric 
Arturo Delvalle ordered Gen. Manuel 
Antonio Noriega replaced. Noriega's ci- 
vilian henchmen called the national 
Legislative Assembly into rump session 
and in 10 minutes took measures they 
claimed impeached President Delvalle 
and Vice President Esquivel. The same 
rump session of the national Legislative 
Assembly called upon the cabinet to 
elect a new president. At 3:30 a.m., 
Manuel Solis Palma was sworn in as 
Panama's Minister of the Presidency, 
the new (figure) head of state. 

President Delvalle, however, re- 
fused to accept his "impeachment" or 
go quietly into exile. He stayed inside 
Panama to continue the battle against 
actions he believes violate the letter of 
the Panamanian Constitution and the 
spirit of democracy. 

On February 26, the White House 
issued the following statement [for 
text, see above]. 



70 



President Delvalle, the opposition 
political parties, and the National Civic 
Crusade, united in their disapproval of 
Noriega and to the Solis Palma presi- 
dency, called a nationwide general 
strike on February 29. The strike was 
successful, both in participation and in 
duration. It lasted for 4 days and dur- 
ing peak periods drew rates of par- 
ticipation as high as 80%. 

In the United States, strong bipar- 
tisan support has been expressed for 
moves to restore democratic civilian 
government to Panama. In the view of 
the U.S. Government and the American 
people. President Delvalle is the lawful 
President of Panama. 

On March 7, Panama's major op- 
position parties — Authentic Pan- 
amenista (PPA), Christian Democratic 
(PDC), and Nationalist Republican Lib- 
eral Movement (MOLIRENA) — issued 
a communique of support for President 
Delvalle and offered to join him in the 
formation of a government of national 
reconciliation. One member of the rul- 
ing Democratic Revolutionary Party 
(PRD) joined in this communique, and 
more are expected to follow. 

The Financial Situation 

On March 1, President Delvalle issued a 
proclamation giving notice to those hav- 
ing dealings with the Government of 
Panama that all obligations owing the 
government should be made directly to 
the Delvalle government and not to the 
Noriega regime. Juan Sosa, Panama's 
Ambassador to the United States and 
one of the officials loyal to President 
Delvalle, took action under this procla- 
mation to marshal and conserve assets 
of the Panamanian Government in U.S. 
federally insured banks. His directions 
to these institutions not to send funds 
from U.S. -based Government of Pan- 
ama accounts to Panama and his initia- 
tion of actions in U.S courts to freeze 
Panamanian Government accounts have 
caused a severe shortage of cash in the 
Panamanian economy, which uses the 
U.S. dollar as its official currency. This 
has accentuated the political crisis. 

Most businesses have ceased to ac- 
cept credit cards or checks for con- 
sumer transactions. Pensioners and 
retirees received government annuity 
checks on March 4 but were initially 
unable to cash them due to bank clos- 
ings. After demonstrations by the pen- 
sioners, the government acted to 
furnish ad hoc check-cashing facilities. 
More government paydays will mate- 
rialize as the month progresses. In the 
absence of new cash infusions from 



some source, the fiscal and financial 
crisis will only worsen. The Delvalle 
government has, in fact, made a forma 
request to the U.S. Government to paj 
canal treaty obligations into an escrow 
account. We have this request under 
review. 

Narcotics Involvement 

Panama's location and dollar-denomi- 
nated banking system have made it a 
key transshipment point and money 
laundering center for drug traffickers. 
In early February, Gen. Noriega 
and others were indicted by two Flor- 
ida grand juries, in Miami and Tampa, 
on charges of profiting from drug traf- 
ficking and protection of traffickers; 
that was the final straw in a situation 
that had already been deteriorating 
dramatically. 



Panama Defense Force 



Let me say in no uncertain terms that 
we bear no ill will toward the Panama 
nian Defense Force as an institution, 
fact, we have a great deal of respect f 
the notable accomplishments of the 
PDF. Civilian activists in Panama, an^ 
indeed, observers in the United State 
must remember the unique services 
that the Panamanian Defense Forces 
have provided in Panama's neglected 
rural areas. The past contributions of 
the PDF to national security and rurj 
development and their potential for ti 
future make the defense force a vital! 
important part of the fabric of Panami 
nian society. 

Military leaders must, for their 
part, take immediate steps to remove 
their institution from politics, deal wi 
the corrupt few, and modernize the 
PDF to carry out military tasks in de 
fense of the canal. Deep military in- 
volvement in politics weakens the I 
civilian and military institutions, just ij; 
as it detracts from Panama's ability tc 
fulfill its crucial role in defense of the 
canal. In professional military matters 
the Panamanian military can continue 
to count on the full support of the 
United States. We believe that strict 
adherence to the canal treaties by bot 
partners is fundamental to Panama's 
democratic future. 



Conclusion 

In Panama today, the issue is civilian 
government and democracy. Civil un- 
rest, official corruption, denial of med 
freedom, and drug scandals have und( 
mined the confidence of foreign inves 
tors and of users of Panama's heavily 



WESTERN HEMISPHERE 



i||/ice-oriented economy. While the 
*king sector is suffering most right 

. larger interests are at risk. With 
iipit te transfer of the Panama Canal 

than 12 years away, and with the 
rn lational transportation sector 
t fiuding significant change, it is 
1 ital that Panama maintain the confi- 
( cf (if future users of the canal. It is 
K.'xatrgeration to say that today's 
I is puts Panama's future on the line. 

Despite the significant U.S. and 
iter foreign interests there, Panama's 
r'rnal political problems are for Pan- 
.miiaiis themselves to resolve. 

The best guarantor of Panama's 
c tiimed economic well-being is a sta- 
1 civilian constitutional government 
, a professional apolitical military 
. vice which enjoy the confidence and 
■pint of the Panamanian people. The 
. v (i(jvernment is firmly committed 
-upjiorting the forces of democracy 
Panama. 

We are promoting dialogue among 
lamanians and the strengthening of 
lama's civihan political institutions, 
latever solution emerges from the 
!sent crisis must make a place for all 
ments of society. And that includes 
i Panama Defense Force, whose de- 
opment as a professional, apolitical 
litary establishment we support to- 
f as in the past. 

We will continue to seek ways to 
Dport democratic civilian rule in Pan- 
la, and we will continue to fulfill our 
sponsibilities under the Panama Ca- 
I Treaties. We are firmly committed 
continue to help this important 
end and ally in the Caribbean Basin 
its search for true democracy. 



SESIDENT'S STATEMENT, 

AR. 11, 19882 

le United States has had a long and 
itually productive relationship with 
.nama. The people of the United 
ates consider the people of Panama to 
near neighbors and friends. The his- 
ric Panama Canal Treaties exemplify 
e close cooperation that has tradition- 
y characterized the friendship be- 
'een the two countries which created 
e of the great engineering works of 
e human race. 

Out of concern for our friendship, 
! have been saddened and in- 
Basingly worried in the recent years 
Panama's political crisis deepened, 
ir policy with respect to the situation 
Panama is clear. We strongly favor a 
pid restoration of democracy and the 



resumption by the Panamanian Defense 
Forces of a role consistent with con- 
stitutional democracy. 

In the present circumstance, I be- 
lieve that Gen. Noriega would best 
serve his country by complying with 
the instruction of President Delvalle to 
relinquish his post. In so doing, Gen. 
Noriega would contribute very substan- 
tially to reducing political tensions and 
set the stage for a prompt transition to 
democracy in Panama. 

Until such a time as democratic 
government is restored in Panama, the 
United States cannot proceed on a 
"business-as-usual" basis. Today, there- 
fore, I have taken a number of steps 
against the illegitimate Noriega regime 
that will contribute significantly to the 
goal of a democratic, stable, and pros- 
perous Panama. 

I have directed that actions be 
taken to suspend trade preferences 
available to Panama under the gener- 
alized system of pi-eferences (GSP) and 
the Caribbean Basin Initiative (CBI). 
Further in keeping with the spirit of 
our war against drugs, I have ordered 
that Panama be subject to intensified 
scrutiny by our immigration and 
customs services in order to apprehend 
drug traffickers and money launderers. 
Moreover because we recognize Presi- 
dent Delvalle as the lawful head of gov- 
ernment in Panama, I have directed 
that all departments and agencies in- 
ventory all sources of funds due or 
payable to the Republic of Panama from 
the U.S. Government for purposes of 
determining those that should be placed 
in escrow for the Delvalle government 
on behalf of the Panamanian people. In 
that light, I have directed that certain 
payments due to Panama from the Pan- 
ama Canal Commission be placed in es- 
crow immediately. This step is in 
complete compliance with our obliga- 
tions under the terms of the Panama 
Canal Treaties. I am prepared to take 
additional steps, if necessary, to deny 
the transfer of funds to the Noriega 
regime from other sources in the 
United States. 

We have welcomed the recent 
statements issued by President Del- 
valle, the political parties, and the Na- 
tional Civic Crusade of Panama calling 
for a go