-
https://clinton.presidentiallibraries.us/files/original/222ae43b904a0dc4d4e1f83b3c8b7a8c.pdf
d34d9d867cae3abf9c4b091e22264b85
PDF Text
Text
THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
IMMEDIATE RELEASE
•'
June 23, 1994
VICE PRESIDENT'S STATEMENT TO THE PRESS
AT THE SIGNING CEREMONY WITH
RUSSIAN PRIME MINISTER CHERNOMYRDIN
When the Prime Minister and I last got together in Moscow this past December, we set out
ambitious tasks for ourselves. Today, we showed that we could accomplish them.
Our Commission had its work cut out for it -- to implement the agreements we signed in
December on space cooperation, business, science and technology, defense conversion, energy, and the
environment. And we had the vital work of building the U.S.-Russian relationship, of moving two old
adversaries toward real and effective partnership.
Our work in the last six months has not been easy - uncertainty about the future of economic
and political reform in Russia drove many to question whether our work together could survive. But
we, both in Moscow and Washington, resolved simply to stay the course.
This is the key. There was work to be done and a way to do it, thanks to the close and
productive ties that rest at many levels ~ from President Clinton and President Yeltsin to the Prime
Minister and me andfromthere to the many people who solve the problems of this relationship on a
day-to-day basis. I know I speak on behalf not only myself but also of the Prime Minister and our
Presidents when I extend my great thanks to you who make this partnership work.
And from the Commission's standpoint, the results are there for all to see:
Our cooperation on the international Space Station is becoming a reality: we signed today a
$400 million contract that will get fundsflowingto the Shuttle-Mir project, an important
precursor to the Station. The interim agreement that we signed cements the details of Russia's
Station partnership. This allows us to build a better Station, at less cost, and in a shorter time
than either of us could achieve acting alone.
We launched the Four-MS project, which involves the AmericanfirmsMarathon and
McDermott, to develop the oilfields of Sakhalin Island. Worth about $10 billion, it will be the
biggest single U.S. investment in Russia and a very positive signal to American investors that
they can successfully do business in Russia.
The environnjent agreetrtent that the Prime Minister and I sighed replaces a 1972 document,
signed during the detonate eria, that in its time was a workhorse for environmental cooperation.
But times have changed. The scope of that agreement Was narrow. This new one provides for
the kind of cooperation that is possible today - for example, between citizen groups in Russia
and the United States.
�In science and technology, we signed five new memoranda of understanding spanning
transportation, biomedicine, geosciences, energy, forestry and basic sciences and engineering.
Here is a tremendous success story -- this committee only signed their umbrella agreement in
December. Already they have created a solid flow of new science and technology cooperation.
And finally, we signed our path breaking agreement to shut down plutonium reactors at Tomsk
and Krasnoyarsk and cease production of plutonium for military purposes. The Prime Minister
and I recommended such an agreement to our Presidents at their summit in January and they
agreed that it should be done. Today that agreement was signed - a testimony to our resolve
to work together to bring nuclear proliferation under control.
My last point deserves a special emphasis. Prime Minister Chernomyrdin and I agree that
nuclear nonproliferation is ourfirstpriority in the security arena. We have acted together to develop an
effective strategy. Our initiatives are designed with four broad goals in mind: preventing theft or
diversion of nuclear materials, building confidence through openness,findingan answer for the longterm disposition of plutonium, and halting accumulation bf excess nuclear stocks. It is this last goal
that the agreement we signed today addresses. We need to pursue our other nonproliferation goals
with equal intensity.
Before I turn the floor over to the Prime Minister, I would like to stress one more issue that has
riveted our attention: the progress of economic reform in Russia. I have to say how impressed I am
that inflation has remained in single digits since February and that privatization has continued apace.
To my mind, privatization is the single most important feature of reform. You and your government
should be congratulated, Mr. Prime Minister, for the results you have achieved. In turn, you have
attracted $1.5 billion in support from the International Monetary Fund - I expect the support of the
internationalfinancialinstitutions to grow with the progress of your reforms.
At the same time, both sides are also focusing intensely on the issues of market access that are
of such concern to both governments. While we are considering the issues for the Russian side ~ the
Jackson-Vanik amendment, for example ~ the Russian side has been considering issues of concern to
us. Recently, for example, they have signed a series of market-opening decrees of great importance to
American business.
Victor Stepanovich, thank you again for a successful meeting, the third of our Commission.
Thank you, too, to Deputy Prime Minister Shokhin (SHOW-kin) and all the members of the
Commission on your side. On the U.S. side, I want to thank our Vice Chairman Ron Brown and
Committee Chairmen Bill Perry, Hazel O'Leary, Carol Browner, Jack Gibbons and Dan Goldin. Lynn
Davis, Undersecretary of State for International Security, also deserves our thanks for her forwardlooking work on nonproliferation matters. And I'd like to thank Ruth Harldn of OPIC for insuring the
success of so many of our pioneering business ventures in Russia.
. .
I am happy to announce that the Prime Minister has invited me to join him in convening our
next session meeting again before too long ~ in Moscow in early winter.
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
AGREEMENTS REACHED BY THE
GORE-CHERNOMYRDIN COMMISSION
The third meeting of the U.S.-Russian Gore-Chemomyrdin Commission was held June 2223,1994, in Washington, D.C. The Commission is co-chaired by U.S. Vice President Al Gore
and Russian Prime Minister Victor Chernomyrdin, and consists of six committees (Space, Energy,
Science and Technology, Defense Conversion, Environment, and Business Development) chaired
at the Cabinet level. As testimony to the breadth of cooperative efforts under the Commission, a
large number of agreements were signed today:
Signed by the Vice President and Prime Minister
- U.S.-Russian Environment Agreement
- Statement of Principle on Data Exchange
- Agreement on the Closure of Plutonium Production Reactors
and the Cessation of Production of Weapons-Grade Plutonium
- Joint Statement on Space Station Cooperation
Signed by Committee Chairs and Others
- Space Station.Interim Agreement
- $400 Million Contract for Joint Shuttle-Mir Program
- Joint Statement on Geostationary Satellite-Aided Search
and Rescue
- MOU on Basic Sciences Cooperation
- MOU on Transportation '
- MOU on Cooperation between Mineral Mining and Management
Service and Roskomnedra (on offshore energy development)
- MOU on Cooperation in the Field of Geoscience
- MOU on Basic Biomedical Research
- MOU on the Establishment of the Oil and Gas Technology
Center
- MOU on Wood, Pulp and Paper Products
- Letter of Commitment for the Lehman Brothers^ Major
Projects Fund (OPIC)
- Framework Agreement on Health Care Support (OPIC)
- Protocol for MIR-Pharmaceutical (OPIC)
- Letter of Commitment for the NIS Frontier Fund (OPIC)
###
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
JUNE 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
THE GORE-CHERNOMYRDIN COMMISSION
The third meeting of the U.S.-Russian Joint Commission on Economic and Technological
Cooperation was held June 22-23 in Washington. The Commission is co-chaired by U.S. Vice
President Al Gore and Russian Prime Minister Viktor Chernomyrdin. The Commission provides a
framework for promoting a partnership between the United States and Russia based on the
principles enumerated in the Vancouver and Moscow Summit declarations. These include a
shared commitment to: democracy and human rights; a market economy and the rule of law; and
international peace and stability. The Commission's work is an effort to realize concrete benefits
from this partnership.
The decision to create the Gore-Chemomyrdin Commission was taken by Presidents
Clinton and Yeltsin at the Vancouver Summit in June 1993. The Commission's original mandate
was to support cooperation in the areas of space, energy, arid high technology. Since then, the
Commission has expanded its scope to include other areas of U.S.-Russian cooperation, such as
business development, defense conversion and the environment. Its six working Committees are
chaired at the cabinet level. A list of American members is attached.
The site of Commission sessions alternates between Russia and the United States. The
inaugural session occurred in Washington, D.C. in August 1993. The second session took place
in Moscow in December 1993. This third Commission session has registered major progress in all
areas of the Commission's work. These achievements include;
- Space: signing of the $400 million contract for the joint Shuttle-Mir program;
- Business Development: signing of the $10-12 billion Sakhalin n project, which
represents the first development of a new Russian energy field involving foreign direct
investment;
- Energy: intergovemmerital agreement requiring a shutdown of plutonium production
reactors and the cessation of use of plutonium for nuclear weapons;
�- Defense Conversion: announcement of thefirstawards to U.S.firmsto establish joint
ventures with Russian defensefirmsconverting to civilian production, and incorporation
of a Defense Conversion Enterprise Fund;
- Science and Technology: conclusion of Memoranda of Understanding on a bilateral
science and technology program; and
- Environment: signing of a bilateral environmental agreement.
Commission meetings have also offered Russian and American participants an opportunity
to travel outside of their respective capitals to meet business leaders and visit plants and technical
facilities. During this visit Prime Minister Chernomyrdin will travel Detroit for meetings with
Michigan business executives and a tour of General Motors auto production facilities.
U.S. MEMBERS OF THE GORE-CHERNOMYRDIN COMMISSION
The Vice President - Co-Chairman of Commission
Secretary of Commerce Ron Brown ~ Vice Chairman of Commission & Chair of Business
Development Committee
Secretary of Energy Hazel O'Leary ~ Chair of Energy Policy Committee
OSTP Director Dr. Jack Gibbons - Chair of Science and Technology Committee
Secretary of Defense Bill Perry ~ Chair of Defense Conversion Committee
NASA Administrator Dan Goldin - Chair of Space Committee
EPA Administrator Carol Browner --. Chair of Environment Committee
Deputy Secretary of State Strobe Talbott
Ambassador at Large for the New Independent States James Collins
ADVISORY COMMITTEE TO THE U.S. CHAIRMAN
U.S. Trade Representative Mickey Kantor
Director of Central Intelligence Agency James Woolsey
Director, Office of Environmental Policy Katie McGinty
AID Administrator Brian Atwood
Under Secretary of Treasury for International Affairs Lawrence Summers
Under Secretary of State for Global Affairs Timothy Wirth
Under Secretary of State for International Security Affairs Lynn Davis
�Chairman, U.S. Nucleat Regulatory Commission Ivan Selin
National Oceanic and Atmospheric Administration Administrator James Baker
OPIC President and CEO Ruth Harkin
EXIM Bank President and Chairman Ken Brodie
Coordinator of U.S. Assistance to the New Independent States Tom Simons
###
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
U.S.-RUSSIAN ENVIRONMENTAL INITIATIVES INCLUDE NEW AGREEMENT
Vice President Al Gore and Russian Prime Minister Viktor Chernomyrdin today signed an
historic bilateral agreement to increase cooperation between the United States and Russia in
protecting our environment.
/
The new agreement, which will be administered by the U.S. Environmental Protection
Agency in consultation with the State Department and other agencies, replaces a 1972 accord
between the U.S. and the U.S.S.R. and provides for:
broader cooperation on global issues such as biodiversity, environmental management, and
public participation in environmental decision-making;
joint formulation of policy on environmental problems of bilateral, regional, and global
significance;
increased data sharing and more vigorous efforts to protect intellectual property rights.
The Gore-Chemomyrdin Commission was established in 1993 to address priority issues
important to the two nations. The agreement signed today by the two leaders will help ensure
that concern for the environment and sustainable use of natural resources are incorporated as a
fundamental element of U.S.-Russian relations in the post-Cold War era.
Among the new cooperative efforts will be other initiatives announced today by
the Commission:
a commitment to work together with other interested countries to reduce the risks
associated with low-level liquid radioactive waste in the Russian Arctic;
a U.S. AID grant of $ 1 million to support the operations of two world-class Russian
research facilities, the Komarov and Vavilov Institutes in St. Petersburg, whose collections
. and capabilities are .critical to biological diversity on a global scale; and
a U.S. EPA grant of $50,000 to the International Cooperative for Ozone Layer Protection
to help Russia phase out the use of substances that deplete the stratospheric ozone layer.
###
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
Fact Sheet
STATEMENT OF PRINCIPLES FOR DATA EXCHANGE
The Statement of Principles for Data Exchange was signed today by Vice President Al
Gore and Prime Minister Victor Chernomyrdin. The statement sets the broad parameters
guiding the exchange of data between the United States and Russia. The free and open
exchange of data is a critical element of our bilateral cooperative relationship. This Statement
is a milestone in allowing full collaboration of scientific information between scientists of
both countries.
Availability of scientific and technological information is central to further progress in
science and technology and, more broadly, to economic growth. In addition, data and
information exchange represents the interests of both countries and of the world scientific
community.
The Statement establishes the following general principles as a basis for cooperation:
The Parties shall, on the basis of parity, provide within the framework of bilateral
cooperation full and open access to scientific and technological data and information relevant
and appropriate to the goals of the cooperation.
The Parties shall promote the exchange of relevant personnel and equipment needed to
implement the goals of scientific and technological data and information exchange.
The Parties agree to develop specific measures to promote the exchange of scientific
and technological data! and information. Among these measures are:
1) Inventories or lists of respective databases relevant to the areas of cooperation,
primarily in fundamental research, space, energy and the environment. Such work could be
conducted by existing or special working groups created within the framework of the U.S.Russia Commission for Economic and Technological Cpoperation
2) The provision of guidance and assistance in developing special procedures for
handling the exchange of sensitive data.
CONTACT; Linda Staheli, Office of Science and Technology Policy, (202) 456-6064
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
JUNE 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
UNITED STATES AND RUSSIA AGREE TO HALT PLUTONIUM PRODUCTION
Vice President Albert Gore and Russian Prime Minister Viktor S. Chernomyrdin today
signed an intergovernmental agreement requiring the shutdown of plutonium production reactors .
and the cessation of use of newly produced plutonium for nuclear weapons.
The agreement obligates both the Russian Federation and the United States to end the
operation of plutonium production reactors by the year 2000. Further, the two countries may not
re-start any of the plutonium production reactors already closed. In the United States, all reactors
used for plutonium production have already shut down. In Russia, three production reactors
remain in operation — in the closed cities of Tomsk-7 (Seversk) and Krasnoyarsk-26
.
(Zheleznogorsk).
The agreement additionally bars both countries from using in nuclear weapons any
plutonium produced by the production reactors after the agreement enters into force. The United
States no longer produces any plutonium for nuclear weapons. The Russian reactors at Tomsk
and Krasnoyarsk have been operating for this purpose. Under this agreement, these reactors no
longer may produce plutonium for nuclear weapons. Measures to assure compliance will be
developed over the next six months.
Because the reactors at Tomsk and Krasnoyarsk are also used to produce heat and electric
power for civilian populations in the surrounding areas, Russia and the United States will work
together to identify and establish replacement capacity. A team of experts from the U.S.
Department of Energy returned from Tomsk and Krasnoyarsk on Saturday, June 18, after
completion,of the first site visit aimed at this goal.
This historic agreement is a major step toward President Clinton's goal of a global ban on
the production of fissile materials for nuclear weapons. The agreement results from discussions
between the Vice President and the Prime Minister at the December 1993 meeting of the U.S.Russian Commission on Economic and Technological Cooperation. The agreement further stems
from subsequent technical meetings and negotiations between Secretary of Energy Hazel R.
O'Leary and Russian Minister of Atomic Energy Viktor N. Mikhailov.
###
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
DECISIONS ON THE INTERNATIONAL SPACE STATION
In today's meeting of the U.S.-Russian Joint Commission on Economic and Technological
Cooperation, chaired by Vice President Al Gore and Russian Prime Minister Viktor
Chernomyrdin, the two sides worked to further U.S.-Russia space cooperation, particularly joint
work on the International Space Station.
In a joint statement, the Vice President and the Prime Minister noted the achievement of a
number of important milestones since the Commission's last meeting in December 1993. Of
particular note is today's signature by the National Aeronautics and Space Administration
(NASA) and the Russian Space Agency (RSA) of an Interim Agreement covering initial Russian
participation in the International Space Station Program. Also signed today was a NASA/RSA
fixed-price contract for $400 million to provide Russian space hardware, services and data in
support of a joint space flight program leading to the development of the International Space.
Station. Key elements of the contract include support of U.S. astronauts onboard the Mir Space
Station for up to 21 months; as many as nine Shuttle docking missions with Mir; provision of
hardware; joint technology developments; and support for peer-reviewed science and technology
research to be conducted onboard Mir.
Other accomplishments include the first flight of a Russian cosmonaut on the U.S. Space
Shuttle, and the commencement of training of U.S. astronauts in Russia to fly on a Russian
spacecraft to Mir. A major technical design review, with participation by all the Space Station
partners, was successfully completed in March. U.S. and Russian hardware has been dehvered.
For example, a Russian docking module model was received for testing in the U.S. to facilitate
future Shuttle dockings with Mir; U.S. solar array components were shipped to Russia as part of a
joint development effort; and Scientific equipment was shipped to Russia for use by U.S. and
Russian astronauts on Mir. In this cooperative effort, the twO governments are encouraging
industry-to-industry arrangements, such as the ones established to provide a Russian docking
module for use onboard the U.S. Space Shuttle and to procure the Russian-developed FGB
Energy Block for guidance, navigation and reboost of the International Space Station.
The Vice President and the Prime Minister charged NASA and the RSA to intensify their
joint efforts in human space flight through, for example,.establishing technical liaison offices in .
Houston and Moscow. They also directed continued efforts to conclude a Protocol to the
Intergovernmental Agreement and a NASA/RSA Memorandum of Understanding on Space
Station cooperation.
###
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
JOINT STATEMENT ON AERONAUTICS
AND SPACE COOPERATION
Recalling the June 17, 1992, Agreement on Cooperation in Exploration and Use of Outer
Space for Peaceful Purposes, and the understandings reached between the U.S. and Russian
Presidents at their summit meetings held in Vancouver on April 3-4, 1993, and in Tokyo on July
8-9, 1993, the U.S. and Russian Governments recognize the great potential for expanded.space
activities between the two nations. At the U.S.-Russian Joint Commission on Economic and
Technological Cooperation on September 1-2,1993, the Governments agreed on a series of
initiatives to expand cooperation in thefieldsof space activities and aeronautics. At the second
meeting of Gore-Chemomyrdin Commission in Moscow in December, 1993, the Governments
took a number of decisions to implement the September initiatives. The Governments note the
excellent progress to date in increasing U.S.-Russian cooperation in aeronautics. Earth sciences
and environmental monitoring, and space sciences, and direct the respective agencies to enhance
their cooperation as outlined in this Joint Statement.
AERONAUTICS
Under the terms of the December 16,1993, Memorandum of Understanding on
Cooperation in Fundamental Aeronautical Sciences between the National Aeronautics and Space
Administration and the State Committee on Defense Branches of Industry, in Moscow, the United
States and Russia have established a new Joint Working Group on Aeronautical Sciences. This
joint working group manages the overall cooperative relationship between the two countries,
develops new proposals for joint aeronautical research, and monitors ongoing activities. The
Institutes of the State Committee on Defense Branches of Industry and NASA expect to start a
number of scientific research programs.
Additionally, the Parties took note of two promising new programs for future cooperation
in the field of aeronautics which build upon the foundation established at the December, 1993,
meeting in Moscow. The United States and Russia announced their intention to pursue high
speed aeronautical research. A Boeing-led U.S. industry team, in cooperation with NASA, will
sign an agreement with the Tupolev Aviation Science and Technology Complex to modify a.
Russian Tu-144 supersonic passenger aircraft for use as an experimental flying testbed for
conducting research which will allow for the development of advanced high speed technologies.
NASA will also conduct several scramjet flight experiments with Russia's Central Institute of
Aviation Motors in order to further the development of scramjet propulsion technology. These
�projects demonstrate how government and industry can work effectively together for the benefit
of all.
SPACE COOPERATION
In accordance with the Joint Statement on the Development of Cooperation in
Environmental Observations from Space and in Space Science from the September 2, 1993,
meeting of the US.-Russian Joint Commission on Economic and Technological Cooperation,
joint plans have been developed to identify opportunities for cooperation in these fields. Both
Governments agree that these activities are subject to the availability of appropriated funds.
Earth Sciences and Environmental Monitoring
U.S.-Russian cooperation in Earth science and environmental monitoring increased
substantially during the past year. The U.S. Vice President and the Russian Prime Minister
approved the plan of the joint U.S.-Russian programs in this area, developed in 1993 by the
Russian Space Agency, the Russian Academy of Sciences, the Russian Federal Service for
Hydrometeorolgy and Environmental Monitoring (ROSHYDROMET), NASA and the National
Oceanic and Atmospheric Administration of the U.S. Department of Commerce, and they directed
their agencies to continue implementing this cooperation.
The Vice President and Prime Minister underscored the important role their science and
technical communities are playing in global change research and environmental monitoring
working on a bilateral basis, and through their broad participation in the international organization
and coordination groups, such as the Committee on Earth Observation Satellites and the
Coordination Group for Meteorological Satellites. These critical activities are advancing our
knowledge of global climate change in order to provide guidance to policy makers who must
balance the needs of constituents with the welfare of the planet and the species that inhabit it.
More than 100 scientists in over 50 U.S. and Russian institutions are currently cooperating
in 22 projects studying everything from physical and biological oceanography to volcanology.
Fifteen additional projects are also under discussion.
Two ofthe proposed cooperative projects involve flying U.S. scientific instruments on
Russian satellites in order to monitor conditions in the upper atmosphere for ozone depletion and
related matters. A related program will also be initiated involving Russian scientists using Russian
ground-based facilities to conduct in-situ measurements to complement the results obtained from
U.S. ozone-monitoring sensors on Russian satellites.
As many as five new projects will be. initiated this year to use a wide variety of Earth
remote sensing instruments to be flown on the Priroda module of the Russian space station Mir in
1995. These American studies represent some 15 institutions engaged in the study of
oceanography, hydrology, and ecology. This program is one of many in the area of scientific
research which results from the newly expanded international space station cooperation.
�During the past year, Russian-supported satellite laser ranging stations tracked over 1380
passes of at least seven-international geodynamics satellites. These data are used by U.S.,
Russian, and other international scientists in their study of geodesy from space. Precision U.S.
equipment is being installed in several Russian locations to better integrate these data into the
international program.
Three satellite receiving stations will be installed within this year in Siberia to support
international efforts to gather a comprehensive, high-resolution data set on the functioning of the
land biosphere and to monitor forest health, detect forestfiresand fire risk, and study the global
carbon cycle.
:
In 1993, a historic joint U.S. Russian field campaign was conducted on the Kamchatka
peninsula. A team of U.S. and Russian geologists surveyed volcanoes and geothermal areas in
this region utilizing on U.S. and two Russian aircraft.
Under discussion are future cooperative activities addressing the detection and prediction
of natural hazards such as earthquakes and cooperative applications of operational environmental
satellite data.
Agreement on Rocket Engine Technologies
NASA will implement a significant, new agreement with the U.S. firm, Pratt & Whimey,
to conduct detailed technology assessments and testing of the RD-170 rocket engine developed
by Russia's NPO Energomash. These studies will also include evaluation of associated
tripropellant technology embodies in the RD-170 engine and the evolutionary tripropellant
(hydrogen, kerosene, and oxygen) rocket engine technology, as developed by NPO Energomash.
NASA and Pratt & Whitney will explore the possible application of these technologies for space
transportation systems. This is one of many examples of the exciting prospects which the future
holds for combining U.S. and Russian know-how and expertise to benefit both industry and the
public at large.
Space Science
-
The Governments noted the many opportunities for expanded cooperative space science
activity. A plan, which was developed by NASA, Russian Space Agency and the Russian
Academy of Sciences regarding cooperation in the field of space science, was presented to the
U.S. Vice President and the Russian Prime Minister. This plan addresses the highest priority
cooperative programs in astronomy and astrophysics, solar system exploration, and solar
terrestrial physics. •
The Vice President and the Prime Minister applauded the emphasis on continuing and
successfully completing the Russian Spectrum series of three great observatories for the
astronomy and astrophysics communities, in which the U.S. scientific community is contributing.
�Vice President Gore and Prime Minister Chernomyrdin fully endorsed the plan to study
solar system exploration cooperation and directed the scientists on both sides to complete the
initial studies and report their findings at the next Commission meeting.
The first of the potential cooperative programs concerns joint studies for Mars
exploration. "Mars Together" is a study of potential cooperative Mars exploration options
consisting of two launches (one U.S. and one Russian) at two-year intervals, with payloads
consisting spacecraft and instruments from both the U.S. and Russia. 1998 and 200L launch
opportunities would be the focus.
The second is a proposal to study jointly a concept in which the United States and Russia
would explore together the extreme ends of the solar system: the Sun ("FIRE") at the center and
Pluto ("ICE") at the outer boundary. These potential missions to the extremes of our universe
hold out exciting prospects for enhancing knowledge of the planets and the forces which bind
them.
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
JOINT STATEMENT ON THE SAKHALIN II PROJECT
Vice President Al Gore and Prime Minister Victor Chernomyrdin today issued a joint
statement in support of the June 22 signing of a Production Sharing Contract for the Sakhalin II
Project. The project represents a major step forward in energy cooperation with the Russian
Federation. Total investment is estimated to be approximately $10 billion to develop, produce
and transport crude oil, liquid condensates and natural gas from the Piltun-Astokhskoye and
Lunskoye fields adjoining Sakhalin Island in the Russian Far East.
The statement reads as follows:
U.S. Vice President A. Gore and Chairman of the Government of the Russian Federation
V. Chernomyrdin, Co-Chairmen of the U.S.-Russian Joint Commission on Economic and
Technological Cooperation, welcome the signing of the Production Sharing Contract for the
Sakhalin II Project, envisaging the production of oil and gas from the Piltun-Astokhskoye and
Lunskoye fields located on the shelf of Sakhalin Island. The signing took place on June 22, 1994,
in Washington, D.C. during the third session of the Commission.
The Sakhalin II project will be executed by Russian companies and'the Sakhalin Energy
Investment Company (SEIC) which was recently established. SEIC was established by U.S.
companies Marathon Oil and McDermott International, and international companies Mitsui &
Company, Ltd.*, Mitsubishi Corporation and Royal Dutch/Shell. The partner companies have been
known as the MMMMS Consortium.
The Co-Chairmen regard the completion of the work over the preparation of the Project,
to be also implemented with participation of companies from other countries, as an important
proof of favorable opportunities for direct investments in Russia, in particular, in oil and gas
production and refining.
The implementation of such a major international project as Sakhalin II is in the interests
of economic development of both countries. It will involve significant financial and technological
resources of western companies in the development of the production and social infrastructure of.
Sakhalin Island and of the entire Russian Far East region. U.S. companies participating in the
project will have new opportunities to increase U.S. exports and employment. Russian
�enterprises and specialists will be equal partners of the foreign participants in the project at all
stages of its implementation. The implementation of the project will involve the use of the latest
world achievements in the field of environment.
The Co-Chairmen are continuing their efforts within the framework of the Commission to
further improve the conditions for the expansion of bilateral trade and investments They expect
an early completion of negotiations now underway on a number of other major investment
projects, in particular the development of oil and gas deposits in the Timan Pechora region (West
Siberia).
' # # #
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
June 23, 1994
. U.S.-Russian Joint Commission
on Economic and Technological Cooperation
U.S.-RUSSIAN NUCLEAR STRATEGY AND SECURITY INITIATIVES
WASHINGTON - The United States and Russia are cooperating in the development of a large
number of nuclear safety and security initiatives. Through these initiatives, the United States and
Russia seek to minimize the risk of nuclear proliferation, enhance the ongoing arms reductions
regime, and build confidence in both. These initiatives are proceeding under the sponsorship of the
Joint Commission on Economic and Technological Cooperation, chaired by Vice President Al Gore
and Prime Minister Victor Chernomyrdin. They are designed to meet four broad objectives:
1.
Securing nuclear materials against theft or diversion:
o Fissile Material Storage Site. The program for the sale and secure dismantlement of
nuclear and other weapons of mass destruction (SSD or Nunn-Lugar program) has set aside
$90 million to help Russia build a safe, secure storage facility for excess plutonium and
highly-enriched uranium (HEU) from dismantled nuclear weapons. Russian officials have
- identified the lack of such a facility as a bottleneck to accelerating dismantlement of nuclear
weapons. Russia will break ground this summer for a site near Chelyabinsk. The first
tranche of U.S. construction equipment will be sent in August. During Prime Minister
Chernomyrdin's June 21-23 visit to Washington, he and Vice President Al Gore agreed that
additional U.S. funds would be set aside for construction of this project.
o HEU Purchase Agreement. At the January Clinton-Yeltsin summit, the U.S.
Enrichment Corporation (USEC) and the Russian Ministry of Atomic Energy (MINATOM)
signed a contract under which USEC will buy low-enriched reactor fuel blended down from
HEU from dismantled weapons. This agreement secures nuclear materials by transforming
them into non-weapons-usable form. This program played a key role in encouraging
Ukraine to ship its nuclear weapons to Russia for dismantlement. Under the Trilateral
Accord signed in January, Ukraine is shipping its warheads to Russia for dismantlement and
is receiving in return LEU to fuel Ukraine's reactors. As of June 23,240 warheads had
been shipped from Ukraine to Russia - ahead of schedule in the Trilateral Accord.
o Material Control and Accounting and Physical Protection. The United States has
offered to provide $30 million in SSD funds for improvements in security and accounting
for nuclear materials in Russia. The proposed program includes $10 million for a fast-paced
comprehensive effort to help Russia find and fix the most urgent security and accounting
weaknesses at its nuclear sites. The United States is also encouraging its national
�laboratories to pursue lab-to-lab cooperation in this area, with $2 million in FY94 and
additional funds in FY95.
o Reduced Enrichment for Research and Test Reactors. The Argonne National
Laboratory and the Russian institute ENTEK are cooperating in the development of
non-weapons-usable LEU fuel to replace HEU fuel in Soviet-designed research reactors.
U.S.-Russian talks on means to broaden and accelerate this conversion program were
initiated in May. An experts meeting will be held in the fall.
o HEU Purchase Agreement Transparency. The United States and Russia reached
agreement in early 1994 on a transparency protocol for the HEU purchase agreement,
designed to ensure that the LEU the United States purchases comes from HEU that in turn
came from dismantled weapons and that the LEU will only be used for peaceful purposes.
o Reciprocal Inspections of Plutonium and HEU from Weapons. In March, the United
States and Russia reached agreement on reciprocal visits to storage sites for plutonium
weapons components from dismantled nuclear weapons. The inspections, which are to take
place by the end of the year, are designed to build confidence that dismantlement is
proceeding in accordance with public statements and that excessfissilematerials are not
being recycled into nuclear'weapons.
o Storage Site Transparency. The United States has proposed a transparency regime for
the fissile material storage site to be built in Russia, designed to ensure that the material
came from weapons and will not be reused in weapons, as required by the Nunn-Lugar
legislation. This regime is under discussion with the Russian side.
o IAEA safeguards on excess materials and all civil facilities. U.S.-Russian discussions on
placing IAEA safeguards on excess fissile materials and all civil facilities were initiated in
May. The January U.S.-Russian Presidential summit committed both sides to consider
placing excessfissilematerials under IAEA safeguards. The United States has long made
all U.S. facilities not directly associated with activities of national military significance
eligible for IAEA safeguards. The January summit statement commits Russia to consider
doing the same.
o Fissile Material Declarations Proposal. U.S.-Russian discussions of their similar
proposals to exchange comprehensive information on the size and locations of their stocks
of HEU and plutonium, both military and civilian, were initiated in late May. The United
States unilaterally made an initial public announcement of past production of weapons
plutonium in December 1993.
3.
Halting further accumulation of excess stocks:
o Shutdown of Plutonium Production Reactors and Bilateral Weapons Plutonium
Production Cutoff. In December 1993, Vice President Al Gore and Russian Prime Minister
Victor Chernomyrdin agreed that Russia would cease production bf plutonium for weapons
�and shut down its last three military plutonium production reactors as soon as alternative
sources were made available to replace the heat and electricity that they provide. Russian
President Boris Yeltsin has pledged to shut the reactors down by the year 2000. The
govemment-to-govemment agreement formalizing these pledges was signed on June 23.
The plutonium produced by these reactors in the interim will be placed under a monitoring
regime to be worked out over the next six months.
o Global Cutoff of Production of Fissile Materials for Nuclear Explosives. President
Clinton has called for the rapid conclusion of a global, verifiable and nondiscriminatory
agreement to end production offissilematerials for nuclear explosives. That objective has ,
been endorsed by Russian President Yeltsin and the U.N. General Assembly. Negotiations
should begin this summer.
4. Carrying out long-term disposition of plutonium:
o U.S.-Russian Fissile Material Disposition and Accumulation Working Group. A
U.S.-Russian working group on the Disposition and Accumulation of Fissile Materials was
established in late May, with agreement on a mandate to consider plutonium disposition and
efforts to ensure that plutonium does not pose an environmental or proliferation threat. The
sides agreed that the issue of further accumulation of excessive stocks-of HEU and civilian
separated plutonium required further discussion.
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
REPORT OF THE DEFENSE CONVERSION COMMITTEE
The U.S.-Russia Committee on Defense Conversion reported substantial progress at the
third meeting of the Gore-Chemomyrdin Commission, June 22-23. The Committee, first
established in November 1993, is the senior-level channel of communication between the U.S. and
Russia for cooperation in the area of defense conversion. It is chaired on the U.S. side by
Secretary of Defense William J. Perry. Mr. Barry Carter, Deputy Under Secretary of Commerce,
serves as the U.S. vice-chair. Mr. Andrei Kokoshin, First Deputy Minister of Defense, and Mr.
Valeriy Mikhailov, First Deputy Minister of the Economy, serve as co-chairs for the Russian side.
The priority objectives of the Committee are to mobilize U.S. assistance to facilitate U.S. private
sector engagement and investment in the conversion of defense industry enterprises in the Russian
Federation, and to work to remove barriers in Russia to effective conversion.
At the meeting the U.S. announced:
- thefirstawards under a March 1994 Nunn-Lugar defense conversion agreement
providing up to $20 million in U.S. assistance to convert Russian defense industries.
International American Products of Columbia, South Carolina will receive $1,949 million to
establish a privatized joint stock company with Leninets of St. Petersburg to produce dental chairs
and other dental equipment. Leninets formerly produced radar and avionics for the military.
Additionally, Double Cola Company of Chattanooga, Tennessee will receive $5,132 to establish a
privatized joint stock company with NPO Mashinostroyenia of Moscow to manufacture Double
Cola brand soft drinks for the Russian market. Mashinostroyenia designed and manufactured
cruise missiles, ICBMs and satellite systems. Additional awards are expected to be announced
shortly.
- the designation of the Defense Enterprise Fund as the Demilitarization Enterprise Fund
authorized by Congress in the FY94 Defense Authorization Bill. It also announced a $7.67
million grant for the Fund and the selection of Randolph Reynolds as the Chairman of the Fund's
Board of Directors. The Fund, a nonprofit, private organization, is designed expressly to assist
converting defensefirmsin Russia and other former Soviet states. It is expected to begin making
awards in August.
- the U.S. Department of Energy's Industrial Partnering program that will provide $35
million to promote joint commercial initiatives between U,S. companies and national laboratories ..
and Russian and former Soviet states'weapons laboratories.
- plans for a fourth Russian-American Entrepreneurial Workshop, to be conducted next
year by U.S. Arms Control and Disarmament Agency and Department of Energy, to provide more
Russian nuclear weapons scientists with the management training and technical assistance needed
to establish civilian-oriented, high-technology enterprises.
�- distribution by the U.S. component of the Committee of the first edition of a Reference
Guide on U.S. and multilateral technical assistance to key Russian cities. This guide is a major
first step toward facilitating the transfer'of responsibility for social safety net concerns away from
the Russian defense industry, by identifying key sources of assistance to this effort.
The Committee also noted the substantial progress in implementing a second Nunn-Lugar
defense conversion program, providing for up to $20 million in U.S. assistance, to establish a joint
business initiative with a Western firm that will convert defense firms in the Moscow area to
establish a prefabricated housing industry in Russia and produce prefabricated housing, the first
units of which will go for demobilized Russian servicemen. The Russian side is contributing to
this effort by providing infrastructure, land, and foundations for the houses. Proposals are due no
later than June 27; contract award is expected in September-October.
Defense conversion is only a part of the larger problem faced by Russia in terms of
economic restructuring, for which the U.S. also is providing assistance, including programs for
the development of the .private sector, for trade and investment, for legal and fiscal reform, and
for retraining. The Committee is stepping up its efforts to coordinate defense conversion
cooperation with these broader assistance programs supporting economic reform and the transfer
of social welfare functionsfromdefense enterprises to municipal, regional, and Federation level
organizations. The Committee also will focus on removing obstacles to private sector
engagement in defense conversion in Russia and on facilitating cooperation in the conversion of
dual use technologies.
To strengthen cooperation and expedite its work, the Committee established a working
group that will meet between formal sessions of the Committee. The next formal session of the
Committee will be held in October in the United States.
###
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
SCIENCE AND TECHNOLOGY COOPERATION
At today's conclusion of the third meeting of the Gore-Chemomyrdin Commission, Vice
President Al Gore and Prime Minister Viktor Chernomyrdin signed a Statement of Principles
on Data Exchange, a major step forward in removing barriers to cooperation in science and
technology. The Statement will facilitate data exchange in all areas of science and
technology, and will facilitate the development of a database inventory enabling researchers in
both countries to be aware of - and have access to - the work of their peers. The Statement
should prevent misunderstandings about the exchange of sensitive or classified data as well.
In addition, both countries have agreed to establish a working group to address other
impediments to collaboration, such as taxes, custom barriers, and access to research sites.
This will be an interagency group established under the S&T Agreement and will begin work
in July.
Building on last December's umbrella S&T Framework Agreement, the Science and
Technology Committee has now concluded ten agency to agency agreements for specific
cooperative activities in areas of significant interest to the United States. The newest
agreements include health, transportation, basic sciences and engineering, geosciences, and
offshore energy development accords. These combine with previous agreements to form a
solid underpinning to the bilateral collaborative scientific relationship between Russia and the
United States.
Finally, the S&T Committee will now concentrate on coordinating and identifying large-scale
multidisciplinary projects that not only involve several technical agencies on both sides, but
also cut across the entire spectrum of the Commission's activities. Areas identified for
possible collaboration include cooperation in free electron lasers, ocean acoustic thermometry,
and nitrogen- free diamonds.
###
CONTACT: Tim Newell, Office of Science and Technology Policy, (202) 456-6018
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
S&T-RELATED MEMORANDA OF UNDERSTANDING
An impressive number of Memoranda of Understanding (MOUs) were signed during
the Commission Meeting in five major areas of interest:
HEALTH: An MOU on Basic Biomedical Research which will enable the U.S. and
Russia to cooperate in areas of cancer research, molecular biology, and genetics,
immunology and AIDs, neurobiology, clinical research and scientific information
exchange (signed by the Acting Director of the National Institutes of Health and the
Vice President of the Russian Academy of Sciences).
-
TRANSPORTATION. An MOU on Transportation will promote cooperation on
important areas of infrastructure development. These include civil aviation, highways,
public transit, railroads, and maritime transportation. More broadly, the MOU will
also promote efficiency in U.S. and Russian transportation systems (signed by the
Secretary of the U.S. Department of Transportation and the Minister of the Russian
Ministry of Transportation).
BASIC SCIENCE AND ENGINEERING: An MOU on Science and Engineering
Cooperation will establish a new framework for advancing cooperative research
between U.S. and Russian scientists and engineers in universities, research institutes,
and other scientific organizations. Unlike its predecessor, this new agreement allows
for joint activities in all fields of basic science and engineering, including materials .
research, lasers, optics, and ecology (signed by the U.S. National Science Foundation
and the Russian Academy of Sciences).
GEOSCIENCES. An MOU on Geosciences will involve both basic and applied
research in fields such as global climate change, water resources, petroleum geology,
and storage and disposal of toxic wastes -- including radioactive wastes (signed by the
Secretary of the U.S. Department of Interior and the Vice President of the Russian
Academy of Sciences and the Head of the Russian State Committee on Geology
(ROSKOMNEDRA),
OFFSHORE ENERGY DEVELOPMENT: An MOU that addresses technical aspects
of regulating the exploration for and development of offshore oil, gas, and mineral
resources (signed by the Secretary of the U.S. Department of Interior and the Russian
State Committee on Geology (ROSKOMNEDRA).
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
Fact Sheet
BASIC BIOMEDICAL RESEARCH MOU
Memorandum of Understanding on Cooperation in the Field of Basic Biomedical
Research between the National Institutes of Health of the United States of America and the
Academy of Sciences of the Russian Federation
This MOU will contribute to an expansion of cooperative scientific activities of mutual
benefit between scientific institutions, government and non-govemment agencies, higher
educational institutions, and individual scientists of in the field of basic biomedical research.
The main objective of the MOU'and resulting activities will be to promote and facilitate
direct cooperation between individual scientists and scientific institutions of the two countries.
Cooperation under this MOU will initially be focused on the following priority areas:
•Cancer
•Immunology and AIDS
•Molecular biology and genetics
•Neurobiology; clinical research
•Related scientific information exchange
These areas will be reviewed periodically and amended, i f necessary, by mutual
written agreement ofthe Parties. Cooperation under this MOU will facilitate and support
exchange of scientists and cooperative scientific activities. This cooperation will consist
primarily of joint research projects; short term exchange visits; and extended visits to conduct
joint research. Other forms of cooperation may be undertaken by written agreement of the
Parties.
# # #
CONTACT: Claire Hubbard, National Institutes of Health, (301) 496-4784.
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
Fact Sheet
MEMORANDUM OF UNDERSTANDING ON TRANSPORTATION
The U.S. Department of Transportation iand the Russian Ministry of Transportation
signed today a Memorandum of Understanding on Cooperation in Transportation Science and
Technology.
The purpose of the MOU is to strengthen transportation-related S&T capabilities and
to promote and expand relations between the scientific and technological communities in both
countries. The MOU will also allow the Department's modal administrations to provide
technical and regulatory assistance to their Russian counterparts and help them with their
policy formulation and standard-setting processes. Areas and topics for cooperation include: '
Modernization of the Russian air traffic control system
Increasing the capacity for overflight air routes through Russian airspace (for U.S. and
other international operators)
Highway planning, rehabilitation and construction
Intelligent vehicle highway system (IVHS)
Privatization/commercialization of the railroads
High-speed rail
Improvements in icebreaking technology
Port privatization
Improving the safety level and usefulness of transportation systems in each country
Cooperation in transportation S&T provides both sides access to unique scientific
resources and data. One example of beneficial S&T cooperation with Russia is a Federal
Aviation Administration (FAA) project that analyzes Russian data on titanium and composite
materials use This state-of-the-art knowledge is extremely valuable to the aviation industry
in the United States.
1
# # #
CONTACT: Zia Kazimi, International Cooperation Division and Secretariat
Office ofthe Secretary of Transportation, (202) 366-7417
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
Fact Sheet
MEMORANDUM OF UNDERSTANDING ON SCIENCE AND ENGINEERING
The National Science Foundation of the United States of America and the Academy of
Sciences of the Russian Federation signed today a Memorandum of Understanding on Science
and Engineering Cooperation. The objective of this MOU is to:
•
Encourage and increase cooperative scientific activities of mutual benefit between
scientists, engineers, and institutions of research and higher learning of the two countries ,
•
Provide opportunities for the exchange of information, ideas, skills, and techniques
Address problems of common interest
•
Utilize facilities and equipment available to both countries for scientific research
Cooperation will cover all branches of science and engineering, including basic and applied
aspects of the natural sciences and mathematics, the engineering sciences, and the social
sciences, but excluding clinical medical research and business administration. The program
undertaken under this MOU will encourage and support exchange of scientists and
cooperative scientific activities, specifically, cooperative research projects and joint seminars
and workshops.
# # #
CONTACT: Alexandra Stepanian, National Science Foundation,' (703) 306-1703
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
Fact Sheet
MEMORANDUM OF UNDERSTANDING ON GEOSCIENCE
The U.S. Geological Survey, the Russian Federation State Committee for Geology and
the Use of Underground Resources, and the Russian Academy of Sciences signed today a
Memorandum of Understanding on Geoscience.
This MOU will support basic and applied research in the earth sciences and facilitate
contacts and data sharing between U.S. and Russian industry. Key areas of research include
global climate change, energy and mineral resources, hydrology and water resources, seismic
and volcano hazards, and the storage of radioactive and other toxic wastes. Program
highlights include:
Paleoclimate Research on Lake Baikal: The U.S. Geological Survey (USGS), the U.S.
National Science Foundation, and the Russian Academy of Sciences (RAS) are
supporting an effort to reconstruct a detailed record of climate change through studies
of sediment cores from Lake Baikal, a 600 km long rift lake in eastern Siberia. The
longest cores (100 meters) ever recovered from Baikal, representing a climate record
for the past 400,000 years, were obtained in winter 1993-94 by drilling from the
frozen lake surface. Analysis of pollen, diatoms, and other indicators in these cores are
providing a unique record of changes in water temperature, productivity, and
vegetation around the lake which will contribute significantly to our understanding of
natural variations in the earth's climate.
Cooperative Research in Energy Resources: In 1990, USGS and Russian scientists
began several cooperative projects to compare U.S. and Russian techniques, develop
unified terminology and concepts, and to share non-commercial information on U.S.
and Soviet petroleum geology. This work provided the basis for an expanded program
of cooperation with the Russian Federation State Committee for Geology and the Use
of Underground Resources (ROSKOMNEDRA), which is presently being funded by
USAID. The program will establish technical-training facilities for petroleum
geochemistry, GIS technology, and seismic data processing at research institutes in
Moscow and Tyumen (west Siberia). These centers will compile and release digitized
maps, data reports and other information on Russian petroleum geology.
1
�Mineral Resource Studies: Since 1989, scientists from USGS, RAS, and
ROSKOMNEDRA have conducted an extensive comparative study of the geology and
mineral resources of the Russian Far East and Alaska. This work, which has produced
descriptions of over 350 Russian ore deposits, will be useful in both resource.
assessment and in the evaluation of environmental consequences of mining.
In 1994, the USGS established the Center for Russian Mineral Resource Studies
(CERMINS). This center will coordinate efforts with ROSKOMNEDRA and RAS to develop
a digital database of Russian mineral resource information, conduct joint resource assessment
exercises, and facilitate contacts between the U.S. and Russian minerals industries.
###
•
CONTACT: Paul Hern, U.S. Geological Survey, (703) 648-6287.
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
IMMEDIATE RELEASE
June 23, 1994
U.S.-Russian Joint Commission
on Economic and Technological Cooperation
Fact Sheet
MEMORANDUM OF UNDERSTANDING ON
OFFSHORE ENERGY DEVELOPMENT
The Minerals Management Service of the Department of the Interior and the
Commitee of the Russian Federation on Geology and Use of Underground Resources signed
today a Memorandum of Understanding on Offshore Energy Development. This MOU will
formalize the evolving relationship between the Minerals Management Service (MMS) and the
Commitee of the Russian Federation on Geology and Use of Underground Resources
(ROSKOMNEDRA), which has focused on the sharing of information. It will establish closer
and more regular contacts, and promote cooperative activities related to the technical aspects
of regulating the exploration for and development of offshore oil, gas, and mineral resources.
•
The MOU will promote the exchange of information and assist both governments in
the environmentally sound management of offshore minerals development.
The exchange of information with ROSKOMNEDRA will enhance MMS's ability to
meet the requirements of the Outer Continental Shelf Lands Act, particularly in the
Bering and Chukchi Seas which border both nations.
. This effort also supports the National Energy Strategy by encouraging the development
of energy resources outside the Persian Gulf and continuing the leadership role the
United States exercises in energy, economic, security and environmental policy.
BACKGROUND.
During a November 1993 visit to Russia, Ms. Carolina Kallaur, Special Assistant to
the Director of MMS, was approached by the Deputy Chairman of ROSKOMNEDRA, who
expressed interest in developing an MOU with the MMS. Informal discussions were held
with the Deputy Chairman Vladislav Scherbakov. In late December, the ROSKOMNEDRA,
submitted a draft MOU to the MMS.
. ..
Activities envisioned under the MOU will focus primarily on environmentally sound
management of offshore energy development practices including environmental protection,
resource assessment, economic and socioeconomic analysis, methods for conveyance of
mineral rights to the private sector, and public and private sector involvement.
�>
j
The MOU is subject to the Agreement between the Government of the United States
of America and the government of the Russian Federation on Science and Technology
Cooperation.
# # #
CONTACT: Brad Laubach, Minerals Management Service, (703) 787-1295.
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
THURSDAY, SEPTEMBER 2, 1993
REMARKS BY THE VICE PRESIDENT
IN SIGNING CEREMONY WITH
PRIME MINISTER CHERNOMYRDIN OF RUSSIA
Room 450, Old Executive O f f i c e B u i l d i n g
The Prime M i n i s t e r and I have worked hard over the past two days
to b r i n g t o l i f e the v i s i o n f i r s t sketched by President C l i n t o n
and President Y e l t s i n at t h e i r summit i n Vancouver: i t i s time t o
leave behind the vestiges o f the Cold War and reach f o r a new
p a r t n e r s h i p between the United States and Russia.
No where w i l l t h i s p a r t n e r s h i p be so keenly f e l t as i n the area
of high-technology cooperation. Each o f our c o u n t r i e s spent the
Cold War years pourir.g our resources i n t o c o m p e t i t i o n . So much
was achieved, but a t such a high cost. Now, we can work t o r J t h e r
to advance a j o i n t agenda i n energy and space, science and
technology, using our cooperation t o keep costs down, husband our
l i m i t e d resources and work together f o r our mutual b e n e f i t .
Turning f o r t y years o f competition i n t o a f u t u r e o f cooperation
i s no easy task. Our Presidents agreed a t Vancouver t h a t highl e v e l a t t e n t i o n would be needed t o jump-start our cooperation,
and t h e i r agreement was the genesis o f t h i s commission. Prime
M i n i s t e r Chernomyrdin and I have focused f u l l y on beginning the
j u m p - s t a r t i n g process during our two days here i n Washington.
Our aim i s t o broaden the U.S.-Russian p a r t n e r s h i p so t h a t i t
encompasses not only s e c u r i t y and f o r e i g n p o l i c y concerns, but
also the e v o l u t i o n o f an economic p a r t n e r s h i p f o r the f u t u r e .
Nothing pleases me more than the r e s u l t s t h a t we already see
emerging, e s p e c i a l l y the agreements on space cooperation that we
have signed here today. Everyone remembers the great f i r s t s that
each o f our space programs achieved. Sputnik 1, the f i r s t humanmade s a t e l l i t e , e l e c t r i f i e d the world when i t was launched on
October 4, 1957. We were equally e x c i t e d when Yury Gagarin
became the f i r s t human being t o f l y i n space i n 1961. Then came
the great p e r i o d o f lunar e x p l o r a t i o n w i t h the U.S. A p o l l o
program and, on the Russian side, the Luna probes.
But the agreements t h a t we signed here today, as much as they owe
to the accomplishments o f t h a t competitive era, most c l e a r l y have
t h e i r roots i n the Apollo-Soyuz rendezvous and docking i n July
1975.
I t was through t h i s p r o j e c t t h a t Russian and American
- more -
�space scientists and engineers, astronauts and cosmonauts f i r s t
began to work together. I am very pleased to have here today
General Tom Stafford and General Alexei Leonov, who flew together
on that pathbreaking mission. Gentlemen, would you stand to be
recognized?
The future holds more of what the Apollo-Soyuz project foretold:
close work together to minimize costs and cut the time needed to
do projects while achieving more than would otherwise have been
possible. Let me review briefly for you the agreements that we
have signed relating to space: f i r s t , the commercial launch
agreement, which w i l l give Russia access to the international
launch services market; second, a joint statement on space
cooperation, which defines a phased approach for cooperation on
human space flight. This statement embraces the potential for
cooperation on a truly international Space Station i f technical
and partnership considerations are met. Finally, two joint
statements, one on environmental monitoring and space science and
the other on aeronautics, will help us to set a broad strategy
for cooperation in global environmental change as well as in the
design of future aircraft.
Dan Goldin, ovr NASA Administrator, and Yury Koptyev, Director of
the Russian Space Agency, will have much to do in coi.ing months
to nail down the agenda of our joint work. I know, however, that
they relish the task, and we will stand ready to help.
In many ways, the agreements on space that we signed today
represent the leading edge of what we are striving to accomplish,
Russia and the United States together: from broad market access
for Russian high-technology goods to long-term projects to work
together in complex, productive ways.
At the same time, I would like to take special note of an
agreement signed today that puts an important issue behind us:
the Memorandum of Understanding on the Missile Technology Control
Regime. By committing to adhere to the guidelines of the MTCR,
Russia i s showing i t s readiness to be a responsible partner in
the sale of high-technology goods and services. This i s a
welcome and important step, and I would like to recognize the
hard work of Under Secretary of State Davis and Deputy Prime
Minister Shokhin in bringing i t to pass.
But space i s not a l l we have worked on during t h i s meeting. We
also had an exceptionally productive series of discussions on
energy matters: gas, o i l and nuclear energy, as well as our
e f f o r t s , on both sides, to deal with barriers to trade and
investment. In t h i s , I think the Prime Minister w i l l agree with
me when I say that we owe much to the experience and suggestions
that the American business community has brought to us during
these sessions. We r e a l l y welcome the input of business, and
expect to work d i r e c t l y with companies through the j o i n t U.S.Russian Business Development Committee chaired on the U.S. side
by Commerce Secretary Brown and on the Russian side by Deputy
Prime Minister Shokhin. Ultimately, i t w i l l be the American
- more -
�business community and not just the American government, that
supplies the capital and technology Russia needs to continue i t s
long-term reforms.
I would l i k e to outline a few of our accomplishments on the
energy side: we w i l l be working closely with Russia and our own
business communities to complete the many U.S. private sector o i l
and gas deals that are ready to go. We were able, I'm pleased to
say, to agree to two specific projects r e l a t i n g t o the private
sector. I n one, the Overseas Private Investment Corporation w i l l
provide $28 m i l l i o n i n guaranty and insurance support f o r
Texaco's $80 m i l l i o n o i l well restoration project i n Western
Siberia. In another, OPIC and the Russian State Investment
Corporation are together supporting a new Investment Fund,
managed by PaineWebber. These investments — $50 m i l l i o n from
OPIC and $25 m i l l i o n from Russia — are for a p r i v a t e investment
fund that i s a model for the j o i n t cooperation that we are t r y i n g
to achieve.
We w i l l work very hard to expand our energy trade and investment.
We have agreed that each of our governments w i l l name an
ombudsman — one American and one Russian — who w i l l work f u l l
time to i d e n t i f y and overcome obstacles to specific investment
and trade projects. At the same-time, Energy Secretary O'Leary
w i l l be working with her counterpart, Minister Shafrannik, to
define new policies that w i l l encourage cooperation i n energy.
Finally, we agreed to launch an important j o i n t study on nuclear
reactor safety issues. This study w i l l add to the fund of
knowledge that has been accumulated i n the past few years and
w i l l help us to plan the most productive areas f o r j o i n t work on
nuclear safety issues. I especially appreciate the Prime
Minister's personal commitment to enhance the safety of his
nation's nuclear plants.
The Prime Minister and I have agreed i n the course of our
meetings that the commission should s p e c i f i c a l l y focus i t s work
on two other very important subjects: the environment, and
science. We w i l l be organizing two groups to carry forward these
agendas, and w i l l see their f i r s t inputs at our next commission
meeting, which w i l l take place within the next few months. The
Prime Minister has i n v i t e d me to v i s i t Russia t h i s f a l l , and I
look forward to doing so.
In conclusion, I would l i k e to extend my thanks t o the many
people on both the U.S. and Russian side who have made t h i s
meeting possible. Mr. Prime Minister, i f i t s beginning f o r e t e l l s
the future, t h i s Commission w i l l be one of the most productive
engines that we have to propel us forward into new areas of
cooperation and partnership. I welcome the challenge, as I know
you do, and I h e a r t i l y look forward to working with you.
# # #
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
September 2, 1993
Joint Statements on Space Cooperation,
Aeronautics and Earth Observation
Vice President A l Gore and Russian Prime Minister Victor
Chernomyrdin issued three j o i n t statements today i n the areas of
space and aeronautical cooperation. Through our high-technology
partnership, the U.S. and Russia w i l l work to realize new
technological advances, productivity gains and cost savings.
These j o i n t statements create a framework and a strategy for
cooperation i n these important high-technology areas.
Joint Statement on Cooperation in Space
In a j o i n t statement signed at the conclusion of the f i r s t
meeting of the U.S.-Russian Joint Coramission on Energy and Space,
Vice President Gore and Prime Minister Chernomyrdin agreed to
combine our considerable experience and resources i n space to
carry out a large-scale program of s c i e n t i f i c , technical, and
technological research. Both sides agreed that s i g n i f i c a n t
mutual benefits could be achieved through cooperation i n space
science and exploration a c t i v i t i e s .
Through the j o i n t statement, the U.S. and Russian have agreed to
begin the f i r s t phase of space cooperation immediately. This
phase w i l l expand cooperation involving the U.S. Space Shuttle
and the Russian Mir Space Station. A second phase w i l l provide
an interim human-tended space science capability, by u t i l i z i n g a
Mir module with a U.S. laboratory module and the U.S. Space
Shuttle. I t also w i l l provide p r a c t i c a l experience i n the use of
d i f f e r e n t transportation systems, performance of complex
construction and assembly, e f f o r t s , and command and control.
A l l planned U.S.-Russian space cooperation programs are
interconnected and have the common goal of creating an effective
space-based s c i e n t i f i c research complex e a r l i e r and with less
cost than i f undertaken separately. The United States and Russia
are convinced that a unified Space Station can o f f e r s i g n i f i c a n t
advantages to a l l concerned, including current U.S. partners —
Canada, Europe and Japan. The U.S. and Russia w i l l j o i n t l y
develop a detailed plan of a c t i v i t i e s for such a Space Station.
This plan w i l l serve as the basis for early review and decision
within each government and as the basis for consultation with
their current international partners.
Joint Statement of the Development of Cooperation i n
Environmental Observations from Space and Space Science
The Vice President and Prime Minister Chernomyrdin agreed that
the U.S. and Russia w i l l examine the enormous potential and
mutual benefit of expanding cooperation in environmental
- more -
�observations from space and i n space science- The j o i n t
statement highlights the importance each country attaches to
b i l a t e r a l and m u l t i l a t e r a l cooperation i n the f i e l d s of spacebased Earth observation, environmental monitoring and space
science and the benefits to be gained from such cooperation by
both sides.
To advance U.S.-Russian partnership i n t h i s area, we w i l l conduct
a j o i n t study to determine the f e a s i b i l i t y of cooperative
programs i n environmental observations from space and i n space
science. The study w i l l be conducted by NASA, the National
Oceanic and Atmospheric Administration (NOAA), and the Russian
Space Agency, under the auspices of the 1992 U.S.-Russian Space
Cooperation Agreement. I t i s to be completed by November 1,
1993.
Joint Statement on Cooperation in Aeronautical
Sciences
The Vice President and Prime Minister Chernomyrdin agreed that
the U.S. and Russia w i l l undertake new cooperation i n the area of
fundamental aeronautical sciences. To t h i s end, the U.S. and
Russia w i l l negotiate a Memorandum of Understanding (MOU) on
Cooperation i n Aeronrutical Sciences between NASA and the Russian
State Committee for efense Industries (Roskomoboronprom).
Later t h i s month, a delegation of NASA specialists w i l l travel t o
Russia to meet with Russian o f f i c i a l s and v i s i t technical
i n s t i t u t e s which may be involved i n the agreed-upon a c t i v i t i e s .
The delegation w i l l i d e n t i f y specific projects and j o i n t research
a c t i v i t i e s of mutual interest and discuss the p o t e n t i a l
establishment of a U.S.-Russian Joint Working Group i n
Aeronautical Sciences to manage the cooperative relationship. I t
is expected that these negotiations w i l l be completed i n time to
allow the new agreement to be signed and enter i n t o force by
November 1, 1993.
# # #
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
September 2, 1993
FACT SHEET
J o i n t US-Russian Energy and Investment Agreements
Vice President Gore and Russian Prime M i n i s t e r Chernomyrdin, coc h a i r s o f the U.S.-Russian J o i n t Commission on Energy and Space,
signed several important agreements today a t the end o f t h e i r
two-day meeting to promote greater U.S.-Russian cooperation i n
energy and space. These agreements represent our j o i n t i n t e n t i o n
to strengthen economic cooperation and s i g n i f i c a n t l y increase
trade and investment, e s p e c i a l l y i n energy-related p r o j e c t s . The
agreements w i l l also help t o b o l s t e r Russia's move t o p r i v a t i z e
major areas o f i t s economy and increase j o i n t cooperation between
our two governments, as w e l l as our p r i v a t e s e c t o r s .
The Overseas P r i v a t e Investment Corporation (OPIC) announced two
ma- j r p r o j e c t s f o r Russia, demonstrating the A d m i n i s t r a t i o n ' s
coiuitiitment t o f u r t h e r a s s i s t Russia's e f f o r t s t o implement
economic reforms. OPIC President Ruth R. Harkin and Deputy Prime
M i n i s t e r Aleksandr Shokhin signed the f i r s t - e v e r U.S.-Russian
Investment Fund. This $100 m i l l i o n p r o j e c t w i l l support the
p r i v a t i z a t i o n process i n Russia and provide s u b s t a n t i a l e q u i t y
investment t o new, emerging businesses.
The fund i s expected t o
generate over f i v e times the i n i t i a l amount o f investment i n the
Russian economy, roughly h a l f a b i l l i o n d o l l a r s , w h i l e also
c r e a t i n g investment o p p o r t u n i t i e s f o r U.S. businesses.
OPIC w i l l
provide a $50 m i l l i o n loan guarantee w i t h Paine Webber, who w i l l
manage the fund, and the Russian Government has agreed t o
c o n t r i b u t e $25 m i l l i o n .
OPIC signed an additional agreement providing $28 million i n loan
guarantees and insurance for Texaco's $80 m i l l i o n project
to r e s t o r e o i l w e l l s i n Russia's Western S i b e r i a region. The
A d m i n i s t r a t i o n i s hopeful t h i s and s i m i l a r e f f o r t s w i l l help the
Russians t o begin r e b u i l d i n g t h e i r energy sector by r e s t o r i n g and
increasing v i t a l o i l exports.
A Memorandum o f Cooperation i n the F i e l d o f F o s s i l Energy, signed
by Secretary o f Energy O'Leary and the Russian M i n i s t e r o f Fuels
and Energy Yuriy Shafranik, w i l l f a c i l i t a t e cooperation i n f o s s i l
energy development. Through t h i s agreement the U.S. and Russia
w i l l work j o i n t l y i n four major areas: t o i d e n t i f y improved
technologies f o r supplying r e s i d e n t i a l and i n d u s t r i a l energy
needs; t o develop environmental remediation technologies by
t r a n s f e r r i n g U.S. know-how and technology which may improve
Russia's environmental p r o t e c t i o n measures; t o conduct j o i n t
- more -
�research and development for improving the production and
d i s t r i b u t i o n methods of non-nuclear energy sources; and to
provide recommendations to commercialize and p r i v a t i z e Russian
facilities.
EXIMBANK and the Russian Ministry o f Finance signed a memorandum
of understanding that w i l l lead to an expansion of the range of
exports to Russia currently financed by Exirabank. Signed by
EXIMBANK Chairman Kenneth D. Brody and Russian
F i r s t Deputy Minister of Finance Andrey Vavilov, the memorandum
outlines the principles to be included i n a Project Finance
Agreement currently under negotiation which would allow EXIMBANK
to expand the scope of trade relations between the U.S. and
Russia t o new o i l and gas projects, as well as projects i n other
promising sectors. W believe t h i s i s one of many steps the
e
Russians have taken to demonstrate t h e i r continued commitment to
promote market reform and encourage further p r i v a t i z a t i o n .
# # #
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
September 2, 1993
United States-Russian J o i n t Commission on
Energy and Space
J o i n t Statement on
the Development o f Cooperation i n
Environmental Observations from Space and i n Space Science
Having reviewed the status o f the Agreement between the United
States o f America and the Russian Federation Concerning
Cooperation i n the E x p l o r a t i o n and Use o f Outer Space f o r
Peaceful Purposes dated June 17, 1992, the P a r t i e s agree that i t
would be m u t u a l l y b e n e f i c i a l t o examine expanded cooperative
a c t i v i t i e s i n Environmental Observations from Space and i n Space
Science.
Given the p a r t i c u l a r importance t o Russia and the United States
of t h e i r . c u r r e n t e f f o r t s t o understand the s c i e n t i f i c basis f o r
g l o b a l environmental c ange and t o conduct s c i e n t i f i c explorat ion
to expand human understanding o f the o r i g i n and nature o f the
solar system and universe, the Parties consider f u r t h e r
cooperation i n t h i s area as most important and c o n s i s t e n t w i t h
the i n t e r e s t s o f both Russia and the United States, as w e l l as
the e n t i r e i n t e r n a t i o n a l community.
With t h i s i n mind, the U.S. and Russia w i l l ask the J o i n t Working
Groups e s t a b l i s h e d under the 1992 Space Cooperation Agreement t o
i n i t i a t e a study to define and determine the f e a s i b i l i t y o f
cooperative programs i n Environmental Observations from Space and
i n Space Science. This j o i n t study s h a l l be pursued i n
accordance w i t h the f o l l o w i n g p r i n c i p l e s :
o
j o i n i n g on a mutually b e n e f i c i a l basis the resources, and
the s c i e n t i f i c and t e c h n i c a l p o t e n t i a l and experience of
Russia and the United States i n Environmental Observation
from Space and Space Sciences;
o
committing t o the f u l l and open sharing o f c i v i l space-based
and i n s i t u data f o r the purposes o f Environmental
M o n i t o r i n g and Global Change Research;
o
working w i t h current i n t e r n a t i o n a l p a r t n e r s ( i n coordination
mechanisms such as the Committee on Earth Observation
S a t e l l i t e s ) , and b i l a t e r a l l y i n the U.S.-Russian Joint
Working Groups on Solar System E x p l o r a t i o n , Astronomy and
Astrophysics, S o l a r - T e r r e s t r i a l Physics, Earth Sciences,
Mission t o Planet Earth ( i n c l u d i n g .the Subgroup on
Operational S a t e l l i t e s Systems and Data Exchange), and Space
Biomedical and L i f e Support Systems, and c o n s i s t e n t with
e x i s t i n g i n t e r n a t i o n a l o b l i g a t i o n s assumed by each of the
Parties;
- more -
�o
seeking to expand U.S.-Russian cooperation i n Environmental
Observations from Space and i n Space Science with a goal to
increase international cooperation to minimize cost,
decrease duplication, and increase the scope and
effectiveness of research i n these d i s c i p l i n e s .
The Parties hereby instruct the National Aeronautics and Space
Administration, the Russian Space Agency, the National
Oceanographic and Atmospheric Administration, the Russian Federal
Hydrometeorological and Environmental Monitoring Service, the
M i n i s t r y of Environmental Protection and Natural Resources of the
Russian Federation, the Russian Academy of Sciences, and other
relevant e n t i t i e s to undertake, i n pursuance of t h i s Joint
Statement, the planned studies that w i l l define development of
the specific projects involving both countries* firms and
organizations, being guided by the above p r i n c i p l e s and
provisions and by existing agreements of both nations with their
i n t e r n a t i o n a l partners, with a completion date f o r the studies
not l a t e r than November 1, 1993.
#
#
#
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
FOR IMMEDIATE RELEASE
September 2, 1993
United States-Russian J o i n t Commission on
Energy and Space
J o i n t Statement on
Cooperation i n Space
Having reviewed the status o f the Agreement between the United
States o f America and the Russian Federation Concerning
Cooperation i n the E x p l o r a t i o n and Use o f Outer Space f o r
Peaceful Purposes dated June 17, 1992, the P a r t i e s note w i t h
s a t i s f a c t i o n past agreement on the f o l l o w i n g : the f l i g h t o f a
Russian cosmonaut on the Space S h u t t l e System i n 1993 and 1994,
and American astronauts on the MIR s t a t i o n , the docking and a
j o i n t f l i g h t o f these two space complexes i n 1995.
These
a c t i v i t i e s are c o n s i s t e n t w i t h the n a t i o n a l space programs o f
both c o u n t r i e s and the o v e r a l l development o f a s p i r i t o f t r u s t ,
pt r t n e r s h i p , and long-term p o l i t i c a l and s c i e n t i f i c and
tt.chnological cooperation between Russia ..nd the United States.
Based on the agreement reached a t a meeting o f the U.S. and
Russian Presidents i n Vancouver on A p r i l 3-4, 1993 and June 17,
1992, the P a r t i e s see great promise and mutual b e n e f i t through
cooperation i n space science and e x p l o r a t i o n a c t i v i t i e s .
Given the p a r t i c u l a r importance f o r Russia and the U.S. o f t h e i r
respective e f f o r t s i n developing a new generation o f o r b i t a l
s t a t i o n s f o r s c i e n t i f i c and t e c h n o l o g i c a l progress and human
a c t i v i t i e s i n space, the P a r t i e s regard f u r t h e r cooperation i n
t h i s area as most important, and c o n s i s t e n t w i t h the i n t e r e s t s o f
both Russia and the U.S., as w e l l as the broader i n t e r n a t i o n a l
community.
With t h i s i n mind i t i s the i n t e n t o f the U.S. and Russia t o
undertake a cooperative human space f l i g h t program. I n t e r i m
i n v e s t i g a t i o n has already i n d i c a t e d p o t e n t i a l advantages o f j o i n t
cooperative a c t i v i t i e s i n a t r u l y i n t e r n a t i o n a l space s t a t i o n
program. The P a r t i e s i n t e n d t o pursue such cooperation i n
accordance w i t h the f o l l o w i n g p r i n c i p l e s :
j o i n i n g on a mutually b e n e f i c i a l basis the resources
and the s c i e n t i f i c , t e c h n o l o g i c a l , and i n d u s t r i a l
p o t e n t i a l s o f Russia and the U.S. i n space a c t i v i t i e s
to c a r r y out a large-scale program o f s c i e n t i f i c ,
t e c h n i c a l , and t e c h n o l o g i c a l research;
working w i t h each o f our current p a r t n e r s , and i n
accordance w i t h e a r l i e r i n t e r n a t i o n a l o b l i g a t i o n s
assumed by each o f the Parties under the Freedom and
MIR p r o j e c t s ;
- more -
�operating in an orbit which i s accessible by both U.S.
and Russian resources;
utilizing compatible service systems, enhancing
r e l i a b i l i t y of the station and increasing the
f l e x i b i l i t y of transportation and technical
maintenance;
performing activities under cooperative programs on
mutually beneficial terms, and including on a contract
basis the procurement of individual systems and units
or the provision of services.
The f i r s t phase of our joint programs begins immediately and i s
designed to form a basis for resolution of engineering and
technical problems. This i n i t i a l phase encompasses an expansion
of our bilateral program involving the U.S. Space Shuttle and the
Russian MIR Space Station. The MIR will be made available for
U.S. experiments for up to two years of total U.S. astronaut stay
time. The number of Space Shuttle flights and the length of crew
stay time will depend upon the details of the experiments to be
defined by November 1, 1993. During phase one, the use of the
Russian modules "Priroda" a i "Spektr," equipped with U.S.
experiments, could undertake a wide-scale research program.
These missions w i l l provide valuable in-orbit experience in
rendezvous, docking, and joint space-based research in l i f e
sciences, microgravity, and Earth resources. I t w i l l bring to
reality performance of large-scale space operations in the
future. The Parties consider i t i s reasonable to initiate in
1993 the joint development of a solar dynamic power system with a
test flight on the Space Shuttle and MIR in 1996, the joint
development of environmental control and l i f e support systems,
and the joint development of a common space suit.
Subsequent j o i n t e f f o r t s on the second phase w i l l be directed to
the use of a Russian MIR module of the next generation, i n
conjunction with a U.S. laboratory module and the U.S. Space
Shuttle. This f a c i l i t y would provide an interim human-tended
space science capability where s i g n i f i c a n t s c i e n t i f i c
experimentation can take place i n a microgravity environment and
also provide p r a c t i c a l experience gained out of the use of
d i f f e r e n t transportation systems (including the U.S. Space
Shuttle and the Russian Proton), performance of complex
construction and assembly e f f o r t s and command and control process
of o r b i t a l structure of considerable complexity. Successful
implementation of this phase could constitute a key element of a
t r u l y international space station.
I t i s envisioned that the U.S. w i l l provide compensation to
Russia for services to be provided during phase one i n the amount
of $100 m i l l i o n dollars i n FY 1994. Additional funding of $300
m i l l i o n dollars, for compensation of phase one and for mutually
- more -
�agreed upon phase two activities, will be provided through 1997.
This funding and appropriate agreements will be confirmed and
signed by no later than November 1, 1993. Other forms of mutual
cooperation and compensation will be considered as appropriate.
All the above programs are mutually connected and are considered
as a single package, the main goal of which i s to create an
effective scientific research complex earlier and with less cost
than i f done separately. The Parties are convinced that a
unified Space Station can offer significant advantages to a l l
concerned, including current U.S. partners, Canada, Europe, and
Japan.
The precise planning process and organization of drafted phases
of joint activity will give the opportunity to benefit both
countries through expanded cooperative efforts on the space
station project.
The Parties hereby instruct NASA and RSA, in pursuance of this
Joint Statement, to develop by November 1, 1993, a detailed plan
of activities for an international space station. This will
serve as the basis f^r early review and decision within each
government and as tho basis for consultations with the
international partners. Upon conclusion of the process of
government approval and consultation, appropriate implementing
agreements w i l l be signed. NASA and RSA w i l l include within the
plan overall configuration, volumes, and forms of contributions
and mutual compensation for Russian and U.S. a c t i v i t i e s .
# # #
�THE WHITE HOUSE
Office of the Vice President
September 2, 1993
FOR IMMEDIATE RELEASE
United States-Russian J o i n t Commission on
Energy and Space
J o i n t Statement on
Cooperation i n A e r o n a u t i c a l Sciences
The United States and the Russian Federation have agreed i n
p r i n c i p l e to undertake new cooperation i n the area o f fundamental
a e r o n a u t i c a l sciences.
As p a r t o f the U.S.-Russian J o i n t Commission on Energy and Space,
co-chaired by Vice President Gore and Prime M i n i s t e r
Chernomyrdin, the two sides agreed t o take concrete steps t o
complete the framework f o r new cooperative research i n
fundamental a e r o n a u t i c a l sciences, u t i l i z i n g the complementary
c a p a b i l i t i e s , f a c i l i t i e s and t a l e n t s o f each side.
The Commission agreed t h a t cooperation w i l l ta'.e place through a
v a r i e t y o f mechanisms, i n c l u d i n g cooperative s c i e n t i f i c research
p r o j e c t s , cooperative u t i l i z a t i o n o f t e s t f a c i l i t i e s and t e s t
a r t i c l e s , j o i n t l y - s p o n s o r e d s c i e n t i f i c conferences, symposia and
workshops, and exchanges o f data, i n f o r m a t i o n and documentation.
Areas t h a t were noted as p a r t i c u l a r l y promising included
hypersonic research, t r a n s i t i o n and turbulence, thermal
p r o t e c t i o n system m a t e r i a l s , chemically r e a c t i n g flows, and
composite s t r u c t u r e s and m a t e r i a l s , i n c l u d i n g computational
modelling.
In order t o a r r i v e a t a concrete agreement on the framework f o r
cooperation i n fundamental a e r o n a u t i c a l sciences, the Commission
agreed that a d e l e g a t i o n o f s p e c i a l i s t s from the National
Aeronautics and Space A d m i n i s t r a t i o n w i l l t r a v e l t o Russia d u r i n g
the month o f September 1993 f o r the purpose o f h o l d i n g t e c h n i c a l
discussions w i t h ROSKOM OBORONPROM. These discussions w i l l be
for the purpose o f i d e n t i f y i n g s p e c i f i c p r o j e c t s and j o i n t
research a c t i v i t i e s t o be pursued over the next several years
between the two c o u n t r i e s . The delegations w i l l also discuss the
establishment o f a U.S.-Russian J o i n t Working Group i n
Aeronautical Sciences to manage the cooperative r e l a t i o n s h i p .
The Commission also agreed t h a t f o l l o w i n g the September 1993
meeting of t e c h n i c a l s p e c i a l i s t s , r e p r e s e n t a t i v e s w i l l meet i n
Washington, D.C, f o r n e g o t i a t i o n s on the t e x t o f a Memorandum o f
Understanding on Cooperation i n A e r o n a u t i c a l Sciences between the
National Aeronautics and Space A d m i n i s t r a t i o n and
ROSKOMOBORONPROM. I t i s expected t h a t these n e g o t i a t i o n s w i l l be
completed i n time t o permit the new agreement t o be signed and
enter i n t o force by November 1, 1993.
K # #
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
September 2, 1993
FOR IMMEDIATE RELEASE
FACT SHEET
U.S.-Russian Commercial Space Launch Agreement
Vice President Gore and Prime M i n i s t e r Chernomyrdin signed an
agreement today between the United States and the Russian
Federation regarding commercial space launch s e r v i c e s . The
agreement opens t h e . i n t e r n a t i o n a l commercial space launch market,
h i t h e r t o l i m i t e d t o U.S., European and Chinese launch service
p r o v i d e r s , t o Russia. The Russian space launch i n d u s t r y , w i t h
i t s strong performance record, should f i n d a ready market f o r i t s
services. We also believe t h i s agreement i s a f i r s t step toward
Russian e n t r y i n t o other high-technology i n t e r n a t i o n a l markets.
The agreement establishes basic r u l e s f o r the commercial space
launch market concerning government involvement i n such areas as
subsidies, marketing inducements and c o r r u p t business p r a c t i c e s .
Russian commercial space laur ;h p r o v i d e r s w i l l be able t o compete
f o r contracts t o launch up t o e i g h t telecommunications
s a t e l l i t e s , i n a d d i t i o n t o the INMARSAT 3 s a t e l l i t e , t o
geosynchronous earth o r b i t f o r i n t e r n a t i o n a l customers u n t i l
December 31, 2000. Up t o four launches may be o f two s a t e l l i t e s ,
and these may be counted as one, i f the p a r t i e s mutually agree
t h a t market conditions warrant such treatment. Russia w i l l also
be able t o provide three launches (of seven s a t e l l i t e s each) t o
low e a r t h o r b i t f o r the I r i d i u m system. Russian proposals f o r
a d d i t i o n a l launches t o low e a r t h o r b i t w i l l be reviewed by the
p a r t i e s and decided by mutual agreement as t h i s unpredictable
market segment develops.
The agreement o b l i g a t e s Russia t o charge p r i c e s f o r i t s launch
services comparable t o Western p r i c e s f o r comparable services.
Prices more than 7.5 percent below the lowest Western b i d f o r
launches t o geosynchronous earth o r b i t would t r i g g e r
c o n s u l t a t i o n s i n which the Russians would need t o explain why
such a p r i c e was comparable t o Western p r i c e s .
Other p r o v i s i o n s o f the agreement include i n f o r m a t i o n exchange, a
mid-term review, annual c o n s u l t a t i o n s on i t s o p e r a t i o n and urgent
c o n s u l t a t i o n s on bids suspected o f being out o f compliance w i t h
the agreement. An "anti-bunching" p r o v i s i o n prevents more than
two launches under the agreement i n a 12-month p e r i o d . The
agreement requires the U.S. t o exercise " b e s t - e f f o r t s " t o issue
export licenses f o r operations under the agreement, but the U.S.
reserves i t s r i g h t t o deny export licenses or impose sanctions
when required under U.S. law. The p a r t i e s may terminate the
agreement by mutual consent.
# # #
�THE WHITE HOUSE
OFFICE OF THE VICE PRESIDENT
F R IMMEDIATE RELEASE
O
September 2, 1993
FACT SHEET
U.S.-Russian Missile Export Controls Agreement
Vice President Gore and Prime Minister Chernomyrdin signed a
Memorandum of Understanding on Missile-Related Exports today, at
the conclusion of the inaugural meeting the U.S.-Russian Joint
Commission on Space and Energy. The agreement i l l u s t r a t e s our
mutual commitment to promoting nonproliferation and effective
export controls. I t provides a strong foundation upon which we
w i l l continue to build our partnership with Russia i n space
cooperation and other areas of mutual i n t e r e s t .
The U.S. and Russian reached an agreement on missile export
controls on July 15. This agreement cleared the way for an
expanded partnership on p r o l i f e r a t i o n issues and i n space
cooperation. In the Memorandum of Understanding (MOU), Russia
agreed to c o n d u c i t s missile-related exports according to the
c r i t e r i a and standards of the m u l t i l a t e r a l Missile Technology
Control Regime (MTCR). This formal commitment on the part of
Russia met a major objective of the U.S. and the 22 other members
of the MTCR. W also reached an understanding on the disposition
e
of Russia's cryogenic rocket engine contract with India. W
e
expect a f i n a l arrangement on t h i s issue to be reached by the
beginning of next year.
Russia's commitment to abide by the c r i t e r i a and standards of the
MTCR i s a welcome and important step that shows i t s readiness to
be a responsible partner i n the sale of high-technology goods and
services.
# # #
�THE WHITE HOUSE
O f f i c e of the Press Secretary
For Immediate Release
A p r i l 12, 1994
REMARKS BY THE PRESIDENT
IN JOINT LEADERSHIP MEETING
The Cabinet Room
10:45 A.M. EDT
THE PRESIDENT: Good morning, l a d i e s and gentlemen o f
the press. This i s our f i r s t b i p a r t i s a n leadership meeting on t h e
resumption o f the Congress and we have a l o t of t h i n g s t o discuss
today.
I want t o begin w i t h a discussion o f the crime b i l l and
the importance o f proceeding d e l i b e r a t e l y and q u i c k l y t o pass i t ; t o
r e i t e r a t e my commitment yesterday t h a t we w i l l do whatever we can t o
get the f i r s t 2 0,000 p o l i c e o f f i c e r s on the s t r e e t s t h i s year i f the
crime b i l l i s passed i n an expeditious fashion.
Then w e ' l l move onto
some other issues where I hope we can have a good b i p a r t i s a n
discussion i n support o f domestic issues l i k e the budget and h e a l t h
care; and also w e ' l l t a l k a l i t t l e about Bosnia today and some other
f o r e i g n p o l i c y issues.
Q
Mr. President, do you have some concern — there's
more s h e l l i n g today. I mean, there's some suspicion t h a t the Muslims
may be t r y i n g t o provoke the Serbs.
Have we s t a r t e d something w i t h
a i r s t r i k e s t h a t w i l l make matters worse r a t h e r than better?
THE PRESIDENT: We c e r t a i n l y haven't s t a r t e d anything.
We have done e x a c t l y what we said we would do under the U.N. p o l i c y
— t h a t i f the U.N. forces t h e r e were put a t r i s k , as they were i n
the s h e l l i n g o f Gorazde, we would o f f e r close a i r support i f t h e
General asked, and the c i v i l i a n a u t h o r i t i e s agreed. We went through
a l l the procedural requirements, and we d i d exactly what I t h i n k we
should have done.
Q
Well, the Serbian
Q
—
What about —
THE PRESIDENT: We have t a l k e d — l e t me answer Andrea's
question — we have cautioned the Bosnian government forces not t o
t r y t o take advantage o f t h i s i n v i o l a t i o n o f the understandings
themselves. And General Rose has been very f i r m on t h a t t h i s
morning.
Q
Are you considering expanding t h i s t o other safe
havens i f the Serbs p e r s i s t and don't get the message?
THE PRESIDENT: Well, I wouldn't r u l e anything out.
We're working very c l o s e l y w i t h General Rose, and he's got a very
aggressive view o f h i s r o l e t h e r e , which I t h i n k i s good —
forces.
arrest.
Q
The Serbian leader has threatened against the U.N.
They've kidnapped some, they're h o l d i n g some i n house
They've escalated the m i l i t a r y a c t i o n .
THE PRESIDENT: Well, every time we have been f i r m ,
though, i n the end i t ' s been a winner f o r the peace process. And I
t h i n k i t w i l l be here. And I'm very encouraged by the p o s i t i o n taken
MORE
�- 2-
by the Russians, t h a t they want the Serbs t o withdraw from the safe
area i n Gorazde, and they want t o r e t u r n t o the n e g o t i a t i n g t a b l e .
Before t h i s l a s t i n c i d e n t , I thought we were g e t t i n g
p r e t t y close t o — not j u s t t o a cease-fire, but t o an absolute
cessation o f h o s t i l i t i e s and a r e a l serious bargaining p o s i t i o n . So
we could g e t back there i n a h u r r y , and I wish t h e Russians w e l l i n
working w i t h the Serbs. I've assured President Y e l t s i n t h a t we have
no i n t e r e s t i n using NATO's a i r power t o a f f e c t the outcome o f the
war. But we do want t o p r o t e c t the U.N. mandate. And we do want a
n e g o t i a t i o n , and I t h i n k we're going t o get one.
Q
Have you seen or heard anything from t h e Serbs t h a t
would i n d i c a t e a response t o the a i r s t r i k e , s i r ?
THE PRESIDENT: I don't know how t o answer t h a t , Peter.
The Russians — Mr. Churkin i s over there now, and we're working on
t r y i n g t o get t h i s t h i n k back on track and I hope we can do i t . But
we have t o be f i r m i n our r e a c t i o n t o t h e plane v i o l a t i o n s o f the
United Nations r e s o l u t i o n s and i n what we set our p o l i c y t o do.
The good t h i n g t h a t we've seen since the t e r r i b l e
i n c i d e n t i n Sarajevo i n the market i s t h a t both the U.N. and NATO
have been able t o f o l l o w what they said t h e i r p o l i c y would be a l l
along, and t h a t was — and I t h i n k t h a t ' s what we have t o do. We
have t o be f i r m i n pursuing t h e p o l i c y t h a t we say we have. I t ' s our
only chance o f success —
Q
W i l l i t be more d i f f i c u l t t o — your domestic
agenda w i t h George M i t c h e l l nominated t o the — w i l l i t be harder,
once he's nominated?
Q
Do you have the name o f a Supreme Court j u s t i c e on
your l e f t ?
THE PRESIDENT: You t h i n k t h e next Supreme Court j u s t i c e
should be t o my l e f t , Helen? (Laughter) —
Q
I s a i d i s he.
Q
Unless you're considering Mr. Foley.
THE PRESIDENT:
Q
He'd be a good one.
Does t h a t make you nervous?
END
(Laughter.)
(Laughter.)
10:50 A.M. EDT
�Sjo^da^ ' W i s
Canu*wa an put* J
Revealed: Russia's secret
weapons for germ warfare
•T
i
RUSSIA issecrcllyet^gcd tn oflcniivr weapons and i f (hey
m tamurc p n y m i m e 10 de- were ever ased. Iheir eflecB
vetop biological weapons, trouM be frily a*fuL"
including J new " s u p c r Boris Yeltsin promised
ptacuc" for vhich there is no Presrfenl Buih thai tbe proimidoic in tfc West, nrites f/nramc had Ixren s*iu( d«wi
Janet Adams from H'aihing- two yetn Zjp. He repeated
n
J
•n
T
•J)
•3
•n
'5
s t i t K>>Rl ahead under (be offidafc tod to a decisioe to
control ot the Russian M rv- e»po« t i e protramrnt
istrf o f Dcfrace. This evi"YeJtsin rs certainly itlhof.
dence wat preseated to us what he bdieves," said J
Yrftsin try Cl<nt»n al iUrir Westera intellisrncr source.
suawit m Moscow last lanu- **8ul thm is not whit is ac
ary.
" E verything
hat laaily ha^pejnn^ If the railiAW.
MoppKl," taid Ydtsin. "You taiy srerealfyabfc todcty »im
thouid not worry."
in this way, it tells us a lot
Tbc platmc i» so powerful
The red death
l i l t j o * ItOkg, spriyed tram
In fact, ike work hat oonttB- about Russia."
pUnn (wmmiiirbuH bombs.
ucd ia deBanoc of Yeltsin's
section 4. page ^
CT»kJ loll 5«aOOO proplt. As.
orders and the military h»s
it b M^smdMt i n * fine pow- that acsumce whe* he met Lakxn steps to expand parts o f
der am] wovid be carried on President Clinton in Vancou- the programme and to hide
Ifie wind, the pbgae s an in- ver US year.
otAen. Until now. perssBie on
dbcrnmniTe weapon.
But evidence from three Yctein has beea applied pnTtoew i t trEB>c»<Jou> oon- defeaon, ant to the CIA and r a l d j tor fear of crodray K B
cenn," s«:d one Weccern M o le M M . has supplied Ihiedr power base, t u t the be^
intdligem sourpe. "Tkcsc t i r proof that the progrmmmc is lief ttat he is being misled br 9 7709SC* 138270
I
�V
lsdimlr P o m l i n i k w»»
h^mln 1917 in SluUngnd.
a city w n to be ravaged
b> (h* tetX'nd wo:M *£r.
lie hvMimt one of the brightrst
vumig joicr.tiil' in the Soviet
Vlnior. diitemiintt) b: use his talfint
ii; tht- CUIM of pwee, iiv-ver allowing hii rcuciircb in biophysics to
pliy any pan in the kind of dcjiruclir>n thnt had cubt lh« live* of his
family.
After graduation, he did reseajch
at the institute of High Molecuisr
Compound* in Lctungrad, wortfing
on r e * intibiotici snd trea-.minis
?(* supposidly incurable illneaies
MK-h ;is cancer.
In 1974. he was approwched by tt
genersl from tl-e Soviet Ministrv of
Defence with
irresistible offer;
f j set up and rur H laboratutv in
Le-.iirnjrnd, with wi oiiliinitcd budget to buy equipneut in tlif Wcit
Slid recruit Ihe bca' awff from all
over the Soviet Union. It would be
known as the Institute of Ultra Pure
Bivcheiviical Preparation*.
For Fatechnik i : was an op pom!nitv to realise many ol ha nwti
cherished ambitions !» the flgiu
agalnsi illness. Hi* earlv reseu-ch
f i t promising; he fell he could produit a cure to some forms of CZJIi<it. Unti: D'.en h j h*d thojghl he
wojld never hsvc me rcsomce* tu
/ I_hav9 a conventional oxter/or
'. ana a
i,,
r :<*..( R : ,k .
r
- i I..;
f ».:«;.t \ \ K
iroir.pleie his work. Now he wa»
being given tha chance to develop
one of the Soviet Union'» ITOM advanced labcrmjrie* in bioieiihnology^ He atcepied
The fact thit -he ot'fei ot.ne froni
the Ministry of Defence did not
worry him unduly. In the Soviet
Union, tha militi.'y was the engine
of most sclemifk research; it had
Ihe cash and the pcdple to run it.
Even if a scicnlinc project had *
strictly civilian application, the
military was still in charge. It was
the Soviet way.
From 1974 to 1981. PHscchruk
built up his special lahorotwy.
scouring the ctmr.try until hi had
400 people on his sttifl. a lavish
budgit and enough hard curroncy to
give his scientists constant tcccs's to
Cie latent biotrehnologicol advancet in ilie West.
Jomes Adams
reveals how
Russia has carried
on developing
weapons of germ
warfare in defiance
of international
agreements.
Exclusive extract
from The New
Spies, his
forthcoming book
THE LABORATORY begun :te
work iri 19S1, Over the nett two
years Pascthmk Icrli^cd the truth:
f(u from being the hein of a new
civilian research ooeralion, he w?,s tact or insect bite, it is namiHi after
at tile ccnlni of s v»»t network of Tulare, California, wheie it w.-e.i
faetojlas arid laboratorie* wuriung dtscovated. The tests on it u-eie iuificiently encourapni; t'er Moscow
on deadly t!«w weapons of ivAr.
"Officially we were involved In :o give permission for full-tcale
vaccine development and in development and production.
Two yeans lattr. the seisndsts at
producing preparations for protecting crops," said Ppsccbnik. " I D ObolsnfW were asked io develop an
fact, we were developing methods even more deadly genn basal on
of production snd equlpncnt for « pneumonic pltigueT anoihet airhuge
biological
warfare oome infection. Pasecurlk's job
wx\ to refine the ['reduction preprogTair.ine."
To begin vvjth. Pasechrik hwd lit- tesse! td mike the operation motetle idoa ofthe scale ofthe opention. efficient. As a result, by 19»7 the
Only Urer did he disvovtr that, & Soviet Union had s-ifficient induswelt as nis laboratory in Leningrad, trial capacity to mttnofacture 200
there were two more In Moscow, kilos of tha s.iper-plajiieii every
two just outside il and one in Novo- week, er.ougli to kill up";o tQb.O'.?)
sibirsk, all working on the sane peopleproject. Five mAnuftciuritls plantt
The tiupei-plaiue g?rm was. of
employing 1?,000 people were course, never manjf^tured on th..«
operating I ' ' ochar pans of the coun- scale. The germ nnJ a sh^n life art.
try. The optration, known is .inly cnougti was made for trstmg.
aiopreparat. nad a budget of 200m But the BiopreDMiii network stood
roubles and t«n» of milliont of on standby, ready to begin fullAmericar dollars c year. It was one scale produetion whvn instruaed. at
Ot the best kep! secrets of ih* cold a time in the iuture t.itu was deswar.
ignated Day X.
Its task was to develop new
Here then w«s a programme
straine of dibe^wt. more powerful producing the most devastatinf.
than anyliilng known to science, gene-jcttUy engineered weaponi
and to prodvee them in aerosol ever seen, j j ^ waiting to be given
form. The jerm also had to be resis- the go-ahead Tinr tjUiintiuw of th.tant IO antibiotics available to th: Riissi.-tn supcr-plaguc eould de^Nuto armies of the West. The astalC any tiiv in the West. kiUir.e
specific job allocated to Passch- millicns uhile leavir.s b'-lildingi.
nik's Inboratory tsutf was to ^riakt factories and raw materials intat-i
them effective' weapons of war The; would tx- th* pcr;'eci detigiiLi
they had to find ways of delivering weapon.
the germii by artillery shell, bomb
At the Soviet (Jvlencc ministrv.
or missile, tc ensure thst t-iey had n Ijigh-ranking g^nerr..\ were fuli>
long Hie in the open air and that aware of this biological citp; bility
they could be dispersed over a wide snd built it into their military planarea.
ning. Kncwr l i ihe Weapons n:
The hreakthrouih came in 19S3 Specifll Pe.tignolkm, they wouid bo
a;
research m.ititutt; of appiie-.i uic<J not only as a las! re.iort but a>
tnicrobiology at Oboiensk. 60 miles support weapons in a conventiona!
SOUtb Cf Moscow. There, with the non-nuclear conflict, to attack '.he
help of work done at Hasetbnik's enemy's troop reserves snd ha.-nwr
laboratory, scientists developed liis op-crotions HI ports und ruil
their firw juper-pUguc: » new ilrnin centres
of '.ulaiaem:':. A severe infectious
Every pjirt of ihis proyramiT'c;
bacterial disease of man and was io breach ot" [);•! 1972 titolo^;domestic animals, carried by con- cal And Tonin Warfark.- C^mtntioi .
;
t
I
t
*
�in irit«niauur»l Bgixcmeni Whlcti
Se Sovlel Union had iiyn#d. It ww
Iso against the spirii of glasno.tt
fid pcreslrotkJ that had b««n p<vItimad by Mikhuil Oo^^3t•he^•
For Pasa^inik, ib<- Gorbnche*
TU WR a chance to try to ch»ng«
i< Jirection of tJie proiiraiiime ai
n laboratory. Ir, late 1985 he prwjred scniot officials in Blopreparat
) let him switL'h icitu of his rttveh st'fort io the civtlian purcscs for which il had ostensibly
<rn cstablisheO. He got nowh»rfc.
' 1 wai '.old tunny times Just to
et on w ilh my work and nay in try
laco," he soid. PMCChnlk did just
hat. Dv 1VS8, he had risen loannk
quivalent to that of major-general
od was in charuo of two mauufactting plants ana three resenrch Ufa.
ifituries. Two of these were
»orking or. biological weapon.;; the
hi.-d WJS given to him to placate hii
itslt'e to dO civil work — and also
4 a cove; for the biological warfare
tseiThBut Pcsechnlk was incteasingly
r.easy. Ho hud no idea that his
S
•VTV WIS in breach of the
Jjnippa.i of iiifomiotion froin
up ta a hundred people, an area
three miles downwind o( the fac- lources in the SoNiet Union t-^t3i> had been coniai'. jniieO. The gei.t*il otti«rwi»e. Satclliic pictures
RxsMtms had tried to contain the showed pian.s and testing sites
damage with » widespread immuni- apparomly tonl.gUied 101 the
sation ptograiYimo but it hud proved m^r.ufaeture ufb ologica! wen|-)iin>
The D1A (ihe Detente Intclliacnce
larfely useless.
AEency. the PenUison'j spies) estiTKROUOHOUT the 1980s, the mated that the Russians had up to
leak had been raised by both British eigiit »ites for ocveloping anc! storand American ufficiaU wi-Ji their ing biological weapons. SIS lurgcW
Soviet counterparts. But the official concurred w-th that view, and a sclir.E rcmsined tie same: Jiat <i bane- ries Of teports *6ie ciivultiUd W
ful of people had died in the city inteliigenee chiefs ar.d British minafter eaiing contaminated meat isters, warning ihat ihe Soiiei blobought on the Slack maricet. There logiual progrimmr had not vlowej
wat no hioiogieiil weapons
cor.tnueet or page S p
\9~2
leat v: l:c did not know such a treaty
I151W. But he fell that th» wtapon*
* wae hclpitig to develop were an
buse of hii jcientific ekilla — and
Itmonstiated hypocrisy in the Rutran military coniin;-;nd about the
iorbachev revolution. Above all,
e felt oitaionntely that genetically
ngineered biolcgical weopons
»MO a crime against humanity.
in late 1988. he began to think
bout Ocfeetins. Despite his long
•xi. illutiu-ioui scientific career,
Stseclinik had oever been allowed
j travel outside the Soviet bloc,
"nen, in the summer of 1989,
liopreparat began negotiation!
Jim a factory in Toulojai, France,
thich manufactures etitiipnitfit for
hemiciil laboratories. Pasechnlk
olunteercd to go to finalise the
kal. Aa « rewaid for his overall
•erformance. permijaion was
:anlcd.
£ ARRIVED In France at Ihe
eginning of October. He had
houghl cansfully about how w
scape the KGB waichers who travlieC with his group. One morning
e telephoned the British embassy
I Paris and in ft briaf convers»don
'ith a surpiUed diplomat »niwiKcd liimself, his position and
ts wish to defect.
The news of his offer reached ;he
'tcret Intelligenc* Sei^joe (313,
•thcrwiw known as M16) in
-endon at a critical time. For the
revious five yean. SIS, the Amwian CIA »;nd a number of NatO mUttfv intelliience orgtmisations had
e*n a>inc to piece toge&er the
nlppcts of information they had
t>OJt the Soviet WolOtical warfere
(Ogranunc.
In May 1979. American intelliuice had heard repons of (Si
tplosion at a secrc: Soviet ree*rc:-) focilitv on the ouukins of
verdOvik, »50 milee cast of Mosjw. A lea*, of anthrw had icillod
.HENLEY
*U>m,n< C'
,
1
CstaDUslicd i n some twenty countries across five
continents. Henley Msnogcment College Is,
without question, one of the world's premier
business schools.
Better placed W give you and your organisation i!
broad pe.-;-pee:ive of jjlobal nunagrment principle^
and priciicw, Henley combines the latest technology
w,ith drwn to earth praciicaJity, provrJi.ng a uniquely
flexiblo approach to managemeni develcipment.
•^'Tieiher you're fiAAiscd on MBA qualificiiiov ™
executive development prugrammes, Sf'ort courset.
cxtende-j leami!^ exix'riences or < specially •ail'jretl
>
programme, you'll find llenUy Mar.agcnwri Collage
will make the world of (Jifferer.ce ...
For more tnfornUUcn call Corporate Marketing O'.l
0491 571454. internationil Code +44 491.
RfrJcy M n.ig'.-nient Cclltjie. Gre«nij<ui .
ncntey-on-Thames. Oxln'dahbe HC.9 }AL'. Fngljnd.
Tfuphone Ot?: 57H54. Fix WJl STtoJJ.
a
i l . u i x r . iMOPi i ;
l
tun.i>iwt»
HUM
�DT* 1 I 1
L J i o n _t._j i i r r-L. ^
ur r i ^ L .
THE RED DEATH
'
j
:
'
tk:vvn iu ii leMi'i or iti« C>J*bldlL»v
rtfcjnil
A3 riTt[urflUjf t i i ^ o j »*tifri
laiciii|(n'.c i * (Hiintas.'v. ffit.
lioliticiiinrcfoKdtrnctOKBWS*A l ihe ticnt all W a u m $ov.
A* u uiual '.n tucn rases, tte Aftaii rjortwtiev j t r . ^ a evirylr;<l!ijtacc
ilr.jaed
frorr. tinn» m'l rr..)»ed ihe noimsily unPn«.'^itili»»«sSuwl wUi
CIA. f.apyuEilc Msjor to wiYt im iniiry
on both n i m j f
Atler.lk ttn Tngw in U.^ !•;« vf il» R a t l i n
i t o j a l c of R'isila i Moloslcai
' W n
« M (OO4* DO
E
weapiitj pr^riinnM wan 8r3<!uill> y<iu." tv itKutefl.
fl'ilcd la. As the- rkture cltaed. so
As tfct iiiiel'.^erne contuiunlty
oets tc ttcai Two raumni Uuer.
Raisis OiiMd to *lli'w t rul!
iiupeciior hut failed to njrnii !b«
Kit'OTM of «11 of ih*ic ,:..v TI*-«
vtrtni-atlon hti i>r>c<J lUirost
liapossiblc.
To idn*nrcc WEiism LunL'e.T^,
OuWucr^vt reTiirnii. i t w n-te w u .^m, .upwli-nr pclitiiil mMtwa. n j n f r u n i u l l v r t t wi-.li Moscow -Jv C l A b m g h l Jul • iWfw'. '
j
ll;>v.iililJld' t o prill* minisic: Foi Lie fuw time, lae politicin"' «.co'iiKi»d thfough the f i t of -Jie B i « p p « a l i i r * i r * » i n e in Salt
I or Dpyictni was M o t i c t l ID risk a *eit kiv»a eoainktuoui reuirts. GcAackcv n d the rise W power of I W I - He cf.nrmr.cO P:i:cbalk s
; coi\froiit«tion w i t h th* S » » i . i CIMTIV
O« * • b u k of See. Yelain. Oc FcWuecy ; I W J . stpty. »ad sdded to WcsWB W fijn: a hi{Wy-plflt«d
Bush
Yelism met for ih«ir first pirion! that, wtiilt Yeltsin
vu
: Union ihm ru^ht i:(wiip eta M i - infamuwa
sUimirt|
il»< prflirflratii«
hti
\ m
Mlanoe ot inteniiutfral t r l i - 3eftC;tir TC U'Xerilne ttw'wnc^* vjnimll. In jdviwc of tir ^twtinj
tioiw. At
tunc ens',- t w t
a ntss o f i!>» arcbUm, Pasecwm r Camp 3ovia, Ainr^c»o dtf- itopptJ. UK roctucli n o oev
•
' seaio:
semt Out C^tcctev * * i ait vvss brotiglit out to brief — - - lo™i» aiwie cleu Ihat the M o b j i - elopmer.t of aew straim of p?*!'lally-eD^ireerea tuperu-ca^Ofll
K f M K a b b nun "ho •^JMJI) not 4l- jfft.-ii)« oo t w * l i d x of the
r u j c r ^Mmtillng blook b o r ^ « n the
tk'w qnj Jilin ai ten lbtc v b r ? l ™ - Attatic.
SVhec President Bill CNIHCH aid
cal »«apon« to be deveUpec '• W r
TTJC evi^nee wa.< (u c o f l j e m i i 1*0 sines ana s gr-imre D>' teltstn
Yci:aio IT.C< in
•
tie w » prcjiicnt Tx- ia:fl'.':{ence if.iit«»enih«f*'liac«iii.whc:rti(iM in i h n arcs
Ynnojuvei «**
_
a ilh tn canfroot G o f b i ^ ^ - " uiert would be
iSlii a y a » ago.
W 1 , a< fllS f u t i w chief in lafl vrilh nc ohoi». In April 1990,
«
of a
hickigical v»3rParis flasbeJ the m;jsage to tin Drtiiti unil Amercan javair,-. now ors ir. USfuc »ns l>t ItK
Losdot! l i o t n ihe w.-^d-tve i e f j e - M u t i Jsi itly conTtonWJic Soviet R u i i l c a iclaaKendu. Onc«
tnt in Tduljuit, i i c i u i o l CJUAII- Urjoo with the evidrbcc aad (iocs. This time
atain, Y t l t s i o
t r j b i t esciieinem At Uo. herr was speCec out in dc'.uil what the; Y e l i t i n c j m f
fiadured
lb«
prepated. He
|»oc?f thai y>oi W iet;if;
hnev there was to rMitian.
AnK^iica pre?i*
most ;ceptl;a) [K)UU«I»». PuecMint
Ttiw. « Icur 1W0, Presl'lem tcmjiiey, foi me
d e r t mat i l l
-Mil lir/en l u ' l V i s ir.J caught a G e o ' i e B u i h and M e r & f r e l fiftt lime. Ui:t
wo:k
hsd
"
" T
a i c . e
mot i c D i r s t c i y * i t h there h t i uxceJ
British Airwcyi flight tokHe^thrjw. n . r
atopped. V h n
triv^n; u oi, tVlii* p«p^« anppLed Gortniohav. Both r4ii*0 ilw v**- b«*n •
l i m e . Yeltcio
pro^ranrae and
by Eritiah imtlligcaw
l i « » of S l o l o j i i j e l weapona;
M-US i l l wnvint.
' A t hl> teei Mxh.-J Briuth soil. Gutachcv denied all knowledee. lb a', ^e nui!
ing mn even
PasochniV buist intc t t a n . Tfte Je- Thatvher. «tw UsiievM Ui« l:ad a oidcMd 11 :o tK
sonc of the
cisiun'i,'! ! i r j « liin umnuy stid his speeiolly^losc relatior.tbip wit;. »tut do»o.
iTiyil C)(lie3l ia
I'sniily had fliocd a terriNt strain the SO'iet leader,'.old him ihat ut>BuiU^ssnot
tha ir.tc'ligenc*
CT lac dcfcH'.T. Ht h « i =vf vlocej low ihe fogramnK w»» ewpped. (or
a.nrth»r
(omnivr-.iijr
imnjeif that
*ortt he r » 3 o x n . tac w e s i wonld go p u b l l e . i r o r m
ihm
wenr inc'.lrifj to
doina Was S 'fiT-Uc thai fce '^tiutli CiO:hiiht;v prgm.Sed Ihal he wouid YblUi^l W (Old
O
believe hitn.
p.-utubl> 1'at.e ^erioj-; c h i - i t s sac Icoi ioto the mattet.
hy his ova ofT>i<3l. 1J« aup«rhaf>a priwii in t l » V * * . ii w v
T » a niurlhi lift*', iha^o^iw r<i»- r.ciali .,f i l l . full
tumn, anothor
metimrc of hil coynir? O A "Jcjpiie e i j r nil:\i«ei-. E A : A M E h t t t r i - u t a m of tho
defectrr f r o m
his ftwri, he s*prc<ri.i|T the plane t i a d i c , sent a f o r r a i ! reply, propaiwae. In
tne Dtc?rep«,i(
i reni.ly U' vs'l all. A l
as t t was ttbsuins the charjes. Ey this umt. March, the Rusproject came
;
.a a safe ham; oulsi^e hulh ihe CIA unci SIS luuJ p^ctccJ nan niil'iary f i ever to British
; Loitdoa he Mrs re&sfucd :h.n hi an i»er. i.io.-e ethumive briefing t s i l y
cimc
imalhfanva
11
i hail r.iiinil j lieu l o ^ r iftd u x a for Bush and Tharrbcr Having »r.c- tkao: theT hJRl
Mil
his
]prln:nccil
ceeded'.DroielnjrvtkinotUie.n^> sKn-Oy devel
There was the aotnill net^ou*- evi le>iU afier 'o ma.iy yeari cf opeil bombi andmisiilcs cs^aWe of Oebrisf«.-i whsi iicpa Iftc Ruiilan
new in SIS abotJt oo* uefctur- « M r e ^ ^ i f k i i ^ i t , the i o l a i l i g e m e cam'ms Ihe tL-pex-pluguei m dtfi- ITli!iUJ> had takca :o keep ths
>ic | i p U n l ; A i l l ! * indi^klluA.^ w0.e coiumutiitY
waa dotvmirei to u i t t t* inwnnuir.na'. agr^imanlt. prt-'jee-. goicf.
In erery fo^ilit^ d-.ai bad been
•.tiat he *a; oc-.ta nac. He i:a a x press In i n x urclt .ne P-uwiain Yelain ligotd a frrinal deem
cancelling Ihe prmrainjue.
opened for inspectior. to Wrbten
<r»o* how |o ij.-ive. i ekwr yij^n dai ionfesied.
BJ: ihe dLiuifomation did ns< i n t e l l i i e n e e , tbe S j>|i4ns had
In De<-cnib<r ]99(]. the F'.issicro
'•.,t WSA a meaibtr of itx jrivikged
'A'aihliginn t u o Ciere. u piucunenl Rtsinm cf - established cor.vinolr.j cove; stoelite in the Soviet Vruorr, ^to dic- iiit'eil an inviwiO"
treis h« shywe-.t *bm he reei.wiird a;«l Lsadon io »isit foil/ o' the siies fu-irls ic»o>ed ic the Bi'.prepsrai ries thai mace it ippeor as if eouh
Site- had bwn eorvcrlnj
Irt rUitiroh
pT\;yiinir»c ^ot atwit
me •••.oriL he wis dMug .vas Im^s- in»i nad t-eea niiineii. A join , A
tlo-Anicrlean
Tjnlmat O B M I X iney r * i been ct iranuficnirc of vaeclnss. The
riblc lo tuba,
SDtret »ork a^i.inued it. ?i'U or
aelcgatior. wj> ir.vo|v«j in. t; was s .-in'.paigr.
;licii t'-icie w i t
aitiikiiilMd.
ai*|iaii:lMd.
fdlcd with the cjnd of ilea ar.d eva. the aiiet thu w i t t nrvcr visited bjIlia lov-e of Ma.
If the tup - w •ionj th«: wan. iLj ;»i*d w. hevo th-j Aowrioon or ^ritiib cfrwiali.
m'l
i.i.'aia^.
miended VJ tc ^aHiVitd in :ht new c,-a trf dernoc- At ItK torac t i m , • i£^'« ww
unteh nc wou;o
facititi was hen's Ixiil'. i t Lakhta
j listen lo in the
jeassurinfr, i i ricy in Russia.
, — —
—
I sveninpi after
bad the opposite
Fo; cuamplr. Ccreril Vjleniin near Si fttenbuij. Fir from the
j-;-t anchor dia. f f » t l . • In V.»vttigi«»yiit acruKd the newt. Bioprparat biuluyiia - wirfart pruObolenslt the liapcr N c j i v i s i n i s y a Cazeiu: pjimoe heiuj shut down, il had
ner w i t h his
coniidcmb'c
Bntlsa dlecov- "Tfiae were nci an ina^; pecclc undergone
EvimllMs. ITe
ered a chtur.ber involved .:v it nitghi >een;.•• H« mofietnisntlyn. w x k I I cimilnunig
SIS aebriefer.i
for testing bio- maiautined thii die vark of the as bewe, in Jrfian-.e of Yilisin s
*cr< quickly
h-.^ical W*ap<>r4 varioua kbcratorica u u waentially
roaaaurod.
ft t>ie atory ao tar has aot had a
nnpeaded ia an for civiau ouipesca. Ho atao tried
He t > t ' ; i i j h !
happy cntllBj ^ir twtain
Amern i o s o l . The to d:mir,uh
roli of rsstcDfilK.
willi
hiili
i
tiMlro.-jin.
Reactions lixc thcie CMtrituttd ica, ihe w u K t of the iofcimailon
wealth of new
w W h waa S>i to grou-.ng icepti^iuv in both thai c x ^ i c d the piocnunnie hus
iiifonaition, " l i
• qoare.
hod Lc-rdon and * a | h i r i ( [ t o r thAt b w o mora FvvtvnwM.
Today, Vladimir ^.itduiik is
ests oa ihe Veltsi^'" order to dljraar.tle the
said ont of ihf
happUy stUed in Gn^iand. He be: a
debricfcri. " A
uor ie » I I K J I Blopiv|Mj-at project was twag car- job nc l o v « working for s Brtisti
whule miniilry
saimali could ried out. Altnoueh th: main teitina
expe^ec. b i l be tied "'hile site wov iepi.»t*d in have been shut compiny doing e»ualy the civilian
Uou: cf m i t l u
rtfli4 irt tKe ceil- djwii, iheae ruomtocin^ Iha j>roj«ol ™»a«T;S
wwiad K de vh&o he
>
spent n cumleg allowed poi- were nardly reesiured wben H was grado^Ted. Po.- him the diaappoin:pleie o r g a m i sons tc
dr annoonmJ thai
ina'i put la ment Is tnai ri:s suertlVe V issvlng
•lion choVA ^
tjmiyed inio li-.t ciun*
of tht ditmaritlicg of the cwnuy he "i'l ulw aboai w<a\
bo a frvot; then
room.
Biopropomt vouifi b# Can^nJ
a piir'.uiic
taniincct
kos niit
ihere was ibe
The teivn oljv Aii»toty XUHW-^MII, -ic anhitoot stopped lh* pro»Tm».»i» I A atill
clesr involve_
'
d i « o v » ( 4 d i of ihe Scv;:t Uxon's chemical CCTs-.de-: to h( s laiotis threst to
icent of CXibjJtwv. '.y-i 'ritud of
chamber aicd :c test dcli-^ry sys- weapon iTJiioaiine. His anmiai- h u nthii'icseareh a allowed m conIf u u ; .
IK. W«(i It juii Mtiu jn and cc"
To cope with i l l the laJDrmiilicn t u n : h i bblAgieal weapsoi. AI rrfnt was -.at as a sop to the tiaae '.' defiance of the poiiuesl
leadMhif in Moeocw, it moke* a
PPieennix prudoMC. JI3,
Mm- tr-tiwr site, ihete was raw i f i t r liardlirsrs ia the milita^.
Or: lenioT Wciteni muiLgence mOCtlty Ot RIISV.J'V preierslsiw IT
iM-j of IMenCe m l m i l i w t m - r w of ^ermennra aaed to iraaawis i l s n^aa be a (lesnoeraey. It alto raises senracnt depanneau set up a sper.ial produce MiiKte*:' of Ulos of Mo- ofTlcliii saW:
t.\Uc foxct of ccianliaic iAtv.li^wxi. k ^ i v i i l we«fcrt> — a chilling T\:C had done nctiiing bat iie to u : o-ji ^ » t i a n s sbout Ihe fiiUie ie:
fiver* ar^ e ialj^i^ '.v A*»M'S die ^ £ . r . f i f n i a t i ^ r of everything fox year: oncheraical weapor.a. and tcotifr^a of th* Roftian -nili'.ary.
now eoddtnly .a aj» toppnwd to who h i m w d pol'tioal capital and
| liiielll$6i:ce and [Vjt l i mic a wider Pa.-cc.-inft b » n"raiil»i.
Neventtriess, the Russians j ^ c e f i diat he I i wllLn ljr j o i n t to scant resources to cortinuc a procon'.ext.
eoniinned theii d t n i t b InStpiem. .<et ibeut declroyins bis life's work, eran-.ine that K m s i n a key pert of
It wai painslfllua j w c i c bui very
t r t i foi A> >•» .t.»crb-J h i . *..t;ro her 1991. a tr.onth after *e at- We could haidy oe e j p w e d io *ieir c-w ptacs.
take Yaluin'ff pro^UM - t l fa£a
l i f t , sducaticn snd w o r i . tht >uk- toiuptdd ooup. John Ma^ol, the » *
B r i t i s h p r i i e m i n u t e r , ihe; >a .i:e."
9 James Adama
ftrcc gaaemood for ihe nrst umt
Ocrbsciiev in the Kreitiim. PIBIIKV
ta .--jly 19M. CK snosh and
the teni rsiciioniiiji: oetween ihe the two-iioar ncctinj w i t confiacc Aracncaa lovonmert-s dt-Tiinvled
Aoadauy of 3;:cncci. pitvioosly tc eecnwue laa-jes, bu: Majxr ton- frt.'ii ilia Russians I list of all their Tht '-r^ Spin, by JumeJ Adams.
&* ptJiUtlud bv Nu&VMtvi cr.
i;,;Q0Kier«.i B pu'elj
Cl-ilW; i y . ^ f ,
1(.-»ilod bim with the ovidcrKio of biotopival
i*«a|»un»
t*,.i*ech, \ i r i l i * . i t ? OP
anrf die 3G\l?t militar*.
i r - K t i r l v ; i i p j i ! fTVulvii"'*. t«T»laci mii ar.d itoraje lilee end ac1
V
1
J
:
K
i If this research i$
ailoAfed tc continue in
defiance of fie
polUical lesdwsfiip
in Moscow, I! raises
serious questions
about the future
intentions of ihe
Russian military j
1
1
T
4 There was a sense
that Gorbachev was
an honourshte man
who would not allow
anything as wrlDte as
bioiogica! weapons to
R
be developed. So ths
intelligence warnings
were ignored 9
a
1
S
:
,
�THE WHITE HOUSE
O f f i c e o f the Press S e c r e t a r y
For Immediate Release
March 25, 1994
March 25, 1994
Presidential Determination
No.
94-19
MEMORANDUM FOR THE SECRETARY OF THE TREASURY
THE CHAIR OF THE BOARD OF DIRECTORS OF THE
UNITED STATES ENRICHMENT CORPORATION
SUBJECT:
A u t h o r i z a t i o n t o Make an Advance Payment f o r t h e
Purchase o f H i g h l y E n r i c h e d Uranium from Russia
On February 18, 1993, the Government o f the U n i t e d S t a t e s
and the Government o f the Russian F e d e r a t i o n e n t e r e d i n t o
an agreement t o arrange the safe and prompt d i s p o s i t i o n f o r
p e a c e f u l purposes o f h i g h l y e n r i c h e d uranium e x t r a c t e d from
n u c l e a r weapons as a r e s u l t o f the r e d u c t i o n o f n u c l e a r weapons
i n accordance w i t h e x i s t i n g agreements i n the area o f arms
c o n t r o l and disarmament. On January 14, 1994, the U n i t e d S t a t e s
Enrichment C o r p o r a t i o n , as Executive Agent o f the U n i t e d S t a t e s ,
e n t e r e d i n t o the i n i t i a l implementing c o n t r a c t pursuant t o t h e
February 18, 1993, agreement f o r the purchase o f l o w - e n r i c h e d
uranium d e r i v e d from h i g h l y e n r i c h e d uranium e x t r a c t e d from
n u c l e a r weapons.
Pursuant t o the a u t h o r i t y vested i n me by the C o n s t i t u t i o n
and s e c t i o n 3324(b) (2) o f t i t l e 31 o f t h e U n i t e d S t a t e s
Code, and h a v i n g decided t h a t an advance o f p u b l i c money
i s necessary t o c a r r y out both the d u t i e s o f the d i s b u r s i n g
o f f i c i a l p r o m p t l y and f a i t h f u l l y and the o b l i g a t i o n o f t h e
U n i t e d S t a t e s Government pursuant t o the i n i t i a l implementing
c o n t r a c t executed on January 14, 1994, I a u t h o r i z e an advance
of p u b l i c money t o be made t o the d i s b u r s i n g o f f i c i a l f o r t h e
purpose o f p r o v i d i n g payment t o the Government o f the Russian
F e d e r a t i o n o r i t s d e s i g n a t e d agent, pursuant t o the terms and
c o n d i t i o n s o f t h e i n i t i a l implementing c o n t r a c t .
The S e c r e t a r y o f the Treasury i s a u t h o r i z e d and d i r e c t e d t o
p u b l i s h t h i s d e t e r m i n a t i o n i n the Federal R e g i s t e r .
WILLIAM J. CLINTON
# # #
�THE WHITE HOUSE
O f f i c e o f the Press S e c r e t a r y
For Immediate Release
March 25, 1994
March 25, 1994
Presidential Determination
No.
94-19
MEMORANDUM FOR THE SECRETARY OF THE TREASURY
THE CHAIR OF THE BOARD OF DIRECTORS OF THE
UNITED STATES ENRICHMENT CORPORATION
SUBJECT:
A u t h o r i z a t i o n t o Make an Advance Payment f o r t h e
Purchase o f H i g h l y E n r i c h e d Uranium from Russia
On February 18, 1993, the Government o f the U n i t e d S t a t e s
and the Government o f the Russian F e d e r a t i o n e n t e r e d i n t o
an agreement t o arrange the safe and prompt d i s p o s i t i o n f o r
p e a c e f u l purposes o f h i g h l y e n r i c h e d uranium e x t r a c t e d from
n u c l e a r weapons as a r e s u l t o f the r e d u c t i o n o f n u c l e a r weapons
i n accordance w i t h e x i s t i n g agreements i n the area o f arms
c o n t r o l and disarmament. On January 14, 1994, the U n i t e d S t a t e s
Enrichment C o r p o r a t i o n , as Executive Agent o f the U n i t e d S t a t e s ,
e n t e r e d i n t o the i n i t i a l implementing c o n t r a c t pursuant t o t h e
February 18, 1993, agreement f o r the purchase o f l o w - e n r i c h e d
uranium d e r i v e d from h i g h l y e n r i c h e d uranium e x t r a c t e d from
n u c l e a r weapons.
Pursuant t o the a u t h o r i t y vested i n me by the C o n s t i t u t i o n
and s e c t i o n 3324(b)(2) o f t i t l e 31 o f the U n i t e d S t a t e s
Code, and h a v i n g decided t h a t an advance o f p u b l i c money
i s necessary t o c a r r y out b o t h the d u t i e s o f the d i s b u r s i n g
o f f i c i a l p r o m p t l y and f a i t h f u l l y and t h e o b l i g a t i o n o f t h e
U n i t e d S t a t e s Government pursuant t o the i n i t i a l implementing
c o n t r a c t executed on January 14, 1994, I a u t h o r i z e an advance
of p u b l i c money t o be made t o the d i s b u r s i n g o f f i c i a l f o r t h e
purpose o f p r o v i d i n g payment t o the Government o f the Russian
F e d e r a t i o n o r i t s d e s i g n a t e d agent, pursuant t o the terms and
c o n d i t i o n s o f the i n i t i a l implementing c o n t r a c t .
The S e c r e t a r y o f the Treasury i s a u t h o r i z e d and d i r e c t e d t o
p u b l i s h t h i s d e t e r m i n a t i o n i n the Federal R e g i s t e r .
WILLIAM J. CLINTON
# # #
�UNCLASSIFIED
N C R O PROFILE
S/M
R C R ID: 9401915
EOD
RECEIVED: 11 M R 94 09
A
TO: PRESIDENT
D C DATE: 10 M R 94
O
A
S U C REF: 9405387
ORE
F O : TALBOTT, S
RM
K Y O D : C M O W A T O INDEPENDENT STATES RUSSIA
EWRS OMNELH F
MEDIA
C
M
PERSONS:
SUBJECT: NIS & C E ASSISTANCE P O R M
E
RGAS
ACTION: P E A E M M F R LAKE
RPR
EO O
D E DATE: 15 M R 94 STATUS: S
U
A
STAFF OFFICER: B R S
UN
FILES: W
H
LOGREF:
NSCP:
CODES:
DOCUMENT
F R ACTION
O
BRS
UN
DISTRIBUTION
FR CNURNE
O
OCREC
FORSYTHE
GOTTEMOELLER
S(
F R INFO
O
CLARKE
ITOH
KNE
ENY
SDREG
OEBR
DATE
B HN
Y AD
CMET:
OMNS
DISPATCHED B
Y
O E E BY: NSJDA
PND
CLOSED BY:
UNCLASSIFIED
DC
O
WATH
/TC
1O
F
1
�S/S
9405387
9/0
DEPARTMENT OF STATE
WASHINGTON
March 1 0 ,
MEMORANDUM FOR:
THE PRESIDENT
FROM:
Strobe T a l b o t t , A c t i n g S e c r e t a r y ffT*
SUBJECT:
1994
NIS and CEE A s s i s t a n c e Prograsm
7
A t t a c h e d i s t h e r e p o r t on a s s i s t a n c e t o CEE and t h e NIS t h a t
B r i a n Atwood and I prepared i n response t o your q u e s t i o n s on
the a r t i c l e s i n t h e W a l l S t r e e t J o u r n a l .
Attachment
�REPORT ON ASSISTANCE TO CEE AND THE NIS
Prepared for the President by
Strobe Talbott and Brian Atwood
EXECUTIVE SUMMARY
The Wall Street Journal a r t i c l e s r e f l e c t a basic
misunderstanding of our assistance programs i n both the NIS and
Central and Eastern Europe (CEE). To be blunt, the c r i t i c s blame
us for not writing blank checks or opening expense accounts for
Russia. Such cash assistance in the current environment of chaos
and corruption, especially in the NIS, would be like dropping
money down a black hole. We provide technical expertise, not
cash. Our assistance programs are premised on the belief that
what the reformers and the new private sector most need i s the
know-how to restructure their existing human and capital
resources to build democratic and free market systems.
In awarding contracts to provide t h i s technical support, we
use a competitive bidding process prescribed by U.S. procurement
laws and we give preference to American companies. This r e f l e c t s
the expressed wish of Congress. By engaging U.S. firms in our
assistance programs i n t h i s way, we also develop business
connections in recipient countries which can lead to future trade
and private investment. These connections w i l l be especially
important as we face reduced assistance levels in the future.
U.S. business should have an expanding role in reinforcing the
growing commercial infrastructure and economic reforms. Indeed,
we are taking steps to ensure that a broader, more diversified
cross section of American companies and non-profit organizations
w i l l be able to participate in the program.
We have made a genuine impact with technical assistance,
especially in the areas of democratization and privatization. W
e
have forged ahead in helping reformers develop democratic
i n s t i t u t i o n s with the assistance of experts, who frequently work
pro bono to a s s i s t with elections and rule-of-law programs. Our
collaboration with the Russian Privatization Ministry has been
e s p e c i a l l y f r u i t f u l . We are seeing positive signs that
••privatization fever" may be catching i n Kazakhstan and Ukraine.
Annex A provides additional examples of program results.
Clearly, one of America's strengths l i e s in our human
resources and what they can offer in terms of experience,
management expertise and technical "know-how" to the reformers of
Russia and the NIS. We genuinely believe i n the wisdom of
judiciously engaging technical experts who can readily impart
knowledge and help reformers arrive at creative solutions to the
intractable problems they face. I t i s not a flawless system, but
in offering top-of-the-line technical expertise, we provide
reformers in t h i s post-Communist era an opportunity to make the
�systemic changes that they see t h e i r countries need. To American
taxpayers, the program offers reassurance that the reform they
are funding can endure.
RATIONALE FOR TECHNICAL ASSISTANCE
The NIS and CEE are not underdeveloped, but misdeveloped.
Our assistance strategy i s to address the special problems
created by up to 70 years of p o l i t i c a l dictatorship and
centrally-planned economies.
The c r i t i c a l edge we bring to the table i s not cash, but
technical expertise. Our assistance i s geared toward helping
these nations advance the precepts of democracy while f u l l y
transforming their economic systems and addressing the
t r a n s i t i o n a l deprivation that change engenders. We would have
been c r i t i c i z e d , with greater j u s t i f i c a t i o n , i f our emphasis had
been to transfer cash rather than knowledge. Cash transfers
would open the door to mismanagement and corruption.
This challenge of restructuring demands high caliber
expertise of considerable breadth and experience. Reputable
firms and known talent — bankers, financiers, accountants,
public administrators, attorneys, constitutional experts —
compete to advise their highly talented counterparts abroad.
Occasionally the firms are large, stemming from their success in
the United States. Just as often the talent we employ i s drawn
from smaller organizations, both profit and non-profit.
Generally, the people we engage are the same technical experts
American businesses employ when they need advice.
One example of effective technical assistance i s our
collaboration with the Russian Privatization Ministry. To date,
8,500 medium and large enterprises have been privatized; 900
medium to very large enterprises are being privatized each month;
70,000 small businesses have been privatized; and 40 percent of
the industrial labor force i s working in private firms. Working
from a base of no experience with private property, 96 percent of
Russians picked up their privatization vouchers; 50 million
Russians have become shareholders; 66 percent of Russians support
privatization — up from 30 percent just 18 months ago.
Successes such as these also have a c a t a l y t i c effect.
Presidents Nazarbayev in Kazakhstan and Kravchuk in Ukraine want
to privatize respectively 8,000 and 30,000 small enterprises this
year partly because i t has worked, with our advice, in the
Visegrad countries and Estonia. The Southeast European countries
are looking in the same direction.
A second example of our technical assistance i s in the area
of democratization. Democratic institutions are inescapably
linked to economic reform, notwithstanding sometimes unwelcome
�election r e s u l t s . Respect for human rights and the rule of law
are at the heart of a c i v i l society. Consequently, we have sent
experts — frequently working pro bono — not only to help with
elections but also to develop a far-reaching rule-of-law program
that ranges from assistance in the r e i n s t i t u t i o n of a f a i r t r a i l by- jury system to the codification of commercial codes and reform
of municipal and regional governments. This i n i t i a t i v e
ultimately w i l l advance the protection of human rights and the
development of an effective and f a i r criminal justice system —
which w i l l embed electoral processes in stable systems of
democratic governance.
The Wall Street Journal a r t i c l e s are also deficient in
ignoring two additional important elements of our assistance
program: humanitarian r e l i e f and enterprise funds in support of
private business in CEE and the NIS.
In Annex B, we assess in
greater d e t a i l the s p e c i f i c points raised in the two Wall Street
Journal a r t i c l e s .
Our humanitarian programs, t o t a l l i n g $2.6 b i l l i o n by year
end 1993, have helped to meet c r i t i c a l food, medical and fuel
needs of populations in the NIS. They have been essential in
staving off starvation and reducing human suffering in Armenia,
Azerbaijan, Georgia and T a j i k i s t a n .
Enterprise funds, now being established in Russia, the
Western NIS, and Central Asia and totaling $690 million in multiyear funding, w i l l help develop a private sector in the NIS.
We
have successfully established Enterprise Funds in Poland the
Czech and Slovak Republics, Hungary, and Bulgaria; we are
expanding them to other parts of CEE. To complement our
technical assistance, the funds w i l l make credit and equity
investments available d i r e c t l y to l o c a l enterprises and joint
ventures, thereby providing badly needed capital to promote
private business.
FUTURE COURSE OF ACTION
Having had experience now in these countries, we are gauging
our successes and f a i l u r e s . We are continually refining our
assistance programs. The i n i t i a l phase of our assistance
emphasized responsiveness, sometimes at the expense of a
comprehensive strategy and adequate management oversight. We now
have a regional strategy in place and have restructured our
budgeting system to discourage project proliferation and focus
resources on strategic objectives.
We are revamping our contracting system to encourage
d i v e r s i t y and competition to get the best s k i l l s for taxpayer
dollars. The contracts discussed in the Wall Street Journal were
largely i n i t i a t e d in November 1992.
Although most contracts were
awarded through a competitive process mandated by U.S.
�procurement laws, the competitions could have been structured to
encourage broader outreach. We are headed in that direction,
making s p e c i f i c changes in our contracting approach — for
example, set-asides for small business and minority firms,
requiring prime contractors to include small business outreach
plans and enforcement mechanisms to ensure that the plans are
implemented.
We are also improving program monitoring, evaluation and
accountability. Already there have been numerous independent
reviews by GAO and USAID's inspector general, and no assessment
has questioned the basic direction of the program. Internally,
we continue to monitor programs through our Embassies and USAID
missions. In January, we submitted the 1993 NIS Annual Report to
Congress, which was based on f i e l d input, with far more incisive
c r i t i c i s m (Annex C) than that of the Wall Street Journal. We
have also instituted a periodic reporting system which involves
a l l USG agencies implementing assistance programs as a means to
identify problems, remove bottlenecks, and make the program work
even better.
That said, we need to go further in program evaluation. We
have already instituted a system of formal evaluation in CEE.
We
are integrating the system into the NIS and sharpening i t s focus
and timeliness. Our emphasis w i l l be on quick, punctual feedback
that allows us to make midstream adjustments, increase program
effectiveness, and redirect resources to other a c t i v i t i e s i f they
can be used more effectively. Our f i r s t evaluation of our NIS
democracy programs w i l l be completed t h i s month. We are
heightening attention to t h i s area and augmenting staff resources
accordingly.
Annexes:
Annex A:
Annex B:
Annex C:
Annex D:
Program Results
Analysis of Wall Street Journal A r t i c l e s on Poland and
the NIS
1993 NIS Annual Report, Assessment of Effectiveness of
U.S. Assistance to the NIS, Overview
Wall Street Journal A r t i c l e s
�Annex A
Program Results
The goals of U.S. assistance i n the CEE region and the NIS are
e s t a b l i s h i n g market economies, developing democratic i n s t i t u t i o n s
and p r a c t i c e s , and easing the human costs associated w i t h
p o l i t i c a l and economic t r a n s i t i o n . I n some areas the
accomplishments t o date are very t a n g i b l e . I n other cases the
ground work i s being l a i d f o r s t r u c t u r a l change, and i t may be
too e a r l y t o judge longer-term impact. The f o l l o w i n g summarizes
many important accomplishments under each goal.
1. T r a n s i t i o n t o Market-based Economies: Our programs are
f o s t e r i n g the emergence of competitive, market-oriented economies
i n which the m a j o r i t y of economic resources are p r i v a t e l y owned
and managed. Macroeconomic s t a b i l i t y and e f f i c i e n c y c a l l f o r
l e g a l , r e g u l a t o r y , procedural and i n s t i t u t i o n a l changes t o
support p r i v a t e , market-based a c t i v i t y . S p e c i f i c r e s u l t s
include:
Privatization:
•
I n Russia, t w o - t h i r d s of a l l small scale shops (70,000) and
8,500 medium and large e n t e r p r i s e s have been p r i v a t i z e d .
900 medium, large and very large enterprises are being
p r i v a t i z e d each month. 40% of Russia's i n d u s t r i a l labor
force i s now working f o r the p r i v a t e sector. 50 m i l l i o n
Russians have become shareholders.
•
I n Hungary, over 30% of p r i v a t i z a t i o n t r a n s a c t i o n s have been
accomplished through employee stock ownerships (ESOPS).
•
I n the Czech Republic, a U.S. advisory team reviewed 300
companies proposed f o r p r i v a t i z a t i o n and helped p r i v a t i z e 84
t h a t have led t o $1.9 b i l l i o n i n f o r e i g n investment, w i t h
$0.5 b i l l i o n more expected.
•
Technical advisors helped t o s t r u c t u r e the $4 b i l l i o n Polish
Mass P r i v a t i z a t i o n Program of 450 former state-owned
enterprises, enabling 25 m i l l i o n Poles t o purchase shares.
•
Enterprise Funds are p r o v i d i n g c a p i t a l resources and
t e c h n i c a l assistance t o both p r i v a t i z e d and new enterprises
throughout CEE and w i l l soon begin operations i n NIS.
Roughly $290 m i l l i o n has been invested i n over 3,000 new
p r i v a t e e n t e r p r i s e s i n CEE, c r e a t i n g an estimated 20,000 new
jobs and leveraging almost $200 m i l l i o n from other
investors. The Russian American Enterprise Fund opened i n
February and should make i t s f i r s t investments imminently.
�Economic Reform:
•
The 50 top Russian banks have developed d e t a i l e d reform
plans. 250 Russian bankers have received U.S. t r a i n i n g and
returned t o apply new approaches t o t h e i r own banks.
•
I n Poland, advisors are helping the Central Bank develop i t s
bank supervision capacity and are preparing several s t a t e owned commercial banks f o r p r i v a t i z a t i o n . Hundreds of
bankers have been t r a i n e d i n Poland, i n c l u d i n g 74 from
Belarus, Estonia, Lithuania and Ukraine.
•
I n Russia, laws have been passed t o promote a n t i - t r u s t and
competition procedures t o permit market forces t o work.
Bankruptcy procedures have been developed which w i l l permit
r e s t r u c t u r i n g of many i n d u s t r i e s .
•
I n Russia, we have helped r e g i o n a l , l o c a l and n a t i o n a l
governments t o develop t a x and expenditure p o l i c i e s which
l i n k revenues w i t h p u b l i c service expenditures a t each
l e v e l . 14 high-ranking o f f i c i a l s have studied U.S.
approaches t o state and l o c a l government finances.
Energy:
•
E f f i c i e n c y audits and demonstrations of U.S. technology have
achieved savings of up t o 30 percent i n Russia, Kazakhstan,
Kyrgyzstan and Armenia i n the massive d i s t r i c t heating
systems which dominate the p r o v i s i o n of heat and hot water.
In one Russian c i t y alone, Kostromo, savings were $15
m i l l i o n a year.
•
I n Poland, Romania, Bulgaria and other Eastern Europe
c o u n t r i e s , U.S. e f f i c i e n c y equipment valued a t over $1
m i l l i o n has been i n s t a l l e d i n over 40 i n d u s t r i a l f a c i l i t i e s .
These p i l o t p r o j e c t s are estimated t o have saved over $16
m i l l i o n annually or over 1 m i l l i o n tons of o i l equivalent.
•
I n Poland, a U.S. p r i v a t e corporation has designed and
i n s t a l l e d a high e f f i c i e n c y f l u e gas desulphurization u n i t
at the Skawina power p l a n t i n Krakow. This i s the f i r s t
such u n i t i n Poland and w i l l allow t h i s p l a n t t o meet the
tough Polish environmental regulations t h a t go i n t o e f f e c t
i n 1998. I t w i l l also reduce p o l l u t i o n i n Krakow which i s
destroying the c u l t u r a l a r t i f a c t s and causing serious health
problems.
•
U.S. advisers demonstrated U.S. energy e f f i c i e n c y equipment
at over 40 i n d u s t r i a l p l a n t s i n CEE and saved approximately
$16 m i l l i o n i n annual savings f o r an investment of about
$1.2 m i l l i o n .
�•
I n nuclear safety, advisors have helped improve safety at
p l a n t s i n Bulgaria, Czech Republic, Slovakia, Hungary and
Bulgaria, Russia and Ukraine.
Housing:
•
Armenia has adopted a housing p r i v a t i z a t i o n law, land tax
law, and a land t r a n s f e r tax p o l i c y which permits land
p r i v a t i z a t i o n . I t includes r e g u l a t i o n s f o r urban land
v a l u a t i o n and sale, and r e g i s t r a t i o n procedures.
•
Kazakhstan has established a housing p o l i c y t o p r i v a t i z e
condominiums and permit p r i v a t e ownership and use r i g h t s t o
land.
•
Russia has established p r i v a t i z e d management and maintenance
of housing f o r 2,000 u n i t s i n Novosibirsk and 7,000 u n i t s i n
Moscow, and has developed mortgage instruments which can be
used despite the current i n f l a t i o n a r y environment. This may
be a model f o r other NIS c o u n t r i e s .
•
I n Poland, the f i r s t market-based mortgages have been made
f o r p r i v a t e i n d i v i d u a l s i n Eastern Europe, through a housing
guaranty program which immediately a f f e c t s 1,500 r e s i d e n t i a l
units.
•
I n Hungary, Szolnok c i t y o f f i c i a l s are r e d i r e c t i n g housing
subsidies t o the most needy, p e r m i t t i n g a reduction i n cost
and greater equity i n the program.
•
Condominium and p r i v a t i z a t i o n laws i n Albania have resulted
i n over 95% of the 270,000 housing u n i t s i n urban areas t o
be p r i v a t i z e d i n one year.
•
U.S. assistance was instrumental i n i n t r o d u c i n g the concept
and substance of the Housing P r i v a t i z a t i o n and Condominium
Law enacted by the Slovak Parliament i n 1993.
2. B u i l d i n g Democracy: U.S. assistance supports the t r a n s i t i o n
t o democratic p o l i t i c a l systems, f r e e and independent media,
transparent and accountable governance, r u l e of law, and the
empowerment of indigenous c i v i c and economic i n s t i t u t i o n s t o
ensure broad-based p a r t i c i p a t i o n i n p o l i t i c a l l i f e .
Specific
achievements to-date include:
P o l i t i c a l Systems and Institutions:
•
The American Bar Association's Central and East Europe Law
I n i t i a t i v e has helped counterparts i n a number of CEE and
NIS countries d r a f t democratic c o n s t i t u t i o n s .
�•
The L i b r a r y of Congress has helped the parliaments of eight
CEE countries e s t a b l i s h parliamentary research and
i n f o r m a t i o n systems t o empower them with a source of
information independent of the executive branch.
•
The I n t e r n a t i o n a l Foundation f o r E l e c t o r a l Systems, the
National Democratic I n s t i t u t e and the I n t e r n a t i o n a l
Republican I n s t i t u t e have helped e s t a b l i s h e l e c t o r a l systems
and supported party development across Central and Eastern
Europe.
•
Parliamentary and p r e s i d e n t i a l e l e c t i o n s i n Russia, Ukraine,
Georgia, Moldova, Albania, Romania and Estonia have
b e n e f i t t e d from U.S. NGO assistance i n c e n t r a l e l e c t i o n
commission procedures, p o l i t i c a l party development, and
poll-watcher t r a i n i n g .
Rule of
Law:
•
American Bar Association t e c h n i c a l advisers have helped
Russia reintroduce t r i a l by j u r y f o r the f i r s t time since
1917 i n nine regions.
•
The American Bar Association helped d r a f t clauses p r o t e c t i n g
human r i g h t s i n the new Hungarian c r i m i n a l code, expected t o
remain i n the f i n a l l e g i s l a t i o n .
•
U.S. anti-monopoly advisors helped d r a f t the e x i s t i n g
competition law, w i t h Poland becoming the f i r s t former
communist country t o have i t s competition r e p o r t accepted by
the OECD. With help from the U.S. FTC and Consumer
P r o t e c t i o n Agency, a Polish Consumer P r o t e c t i o n Department
has been established w i t h i n the Anti-Monopoly O f f i c e .
•
The National Democratic I n s t i t u t e has helped Romania's ProDemocracy Association (PDA) launch a three-month
parliamentary transparency and a c c o u n t a b i l i t y campaign. As
of January 1994:
(1) small groups of c i t i z e n s are now being
admitted t o the plenary debates i n the Senate; and (2) the
parliamentary newspaper w i l l p u b l i s h the upcoming d r a f t laws
t o be debated.
Independent Media:
•
The I n t e r n a t i o n a l Media Fund (IMF) has helped launch
independent newspapers and r a d i o s t a t i o n s across CEE as w e l l
as e s t a b l i s h media resource centers i n the r e g i o n .
•
Internews (a U.S. NGO) helped l i n k s i x independent Russian
TV s t a t i o n s , f o r the production of two l o c a l news programs
on more than 40 s t a t i o n s i n Russia, Ukraine and Kazakhstan
for a combined viewership o f over 70 m i l l i o n . I n the
�Ukraine, Internews helped create a network of independent TV
s t a t i o n s w i t h a wider viewership than Ukrainian s t a t e
television.
Local Government and C i v i l I n s t i t u t i o n s :
•
The I n t e r n a t i o n a l City Manager's Association has provided
t e c h n i c a l assistance and t r a i n i n g t o several l o c a l municipal
government associations i n Poland, the Czech Republic and
Slovakia, and helped t o e s t a b l i s h s e l f - s u s t a i n i n g vocal
centers p l a y i n g an important r o l e i n the d e c e n t r a l i z a t i o n of
power from c e n t r a l t o r e g i o n a l and l o c a l governments.
•
Over 200 Polish l o c a l municipal c o u n c i l members and
a d m i n i s t r a t o r s were t r a i n e d i n p r i n c i p l e s of p u b l i c service
o r g a n i z a t i o n , management and l o c a l finance.
•
To help the Russian people b u i l d the i n s t i t u t i o n s of a c i v i c
s o c i e t y , grants were provided t o over 300 indigenous
nongovernmental organizations and provided t e c h n i c a l
assistance t o encourage formation of a d d i t i o n a l NGOs. Four
years ago, such organizations were a l l but unknown. Today
there are a t l e a s t 12,000 of NGOs i n the NIS.
3. Easing Human Costs:
Our focus i s on r e d e f i n i n g p u b l i c and
p r i v a t e sector r o l e s i n the management of humanitarian, h e a l t h ,
and r e l a t e d s o c i a l services fundamental t o a s t a b l e t r a n s i t i o n .
Emergency assistance provides some r e l i e f as new systems are put
i n place. S p e c i f i c achievements include:
Emergency Assistance:
•
Emergency humanitarian assistance has helped avoid hunger,
epidemics and other hardships i n s t r i f e - t o r n Armenia,
Georgia, Azerbaijan and T a j i k i s t a n , as w e l l as the former
Yugoslavia. C r i t i c a l l y needed medical supplies and
emergency food a i d have been d i r e c t e d t o the most vulnerable
groups. Emergency kerosene and seed wheat are helping
Armenia survive the w i n t e r and w i l l permit s p r i n g p l a n t i n g .
Looking longer term, pharmaceutical and vaccine production
capacity i s being restored i n Russia.
•
A g r i c u l t u r a l and d a i r y products t o vulnerable groups i n
Armenia, Georgia and Russia have already reached 2,226,000
pregnant and nursing mothers, i n f a n t s and pensioners.
Another $38 m i l l i o n i n such assistance i s being provided
t h i s year.
•
I n Central Asia, v a c c i n a t i o n of over 500,000 c h i l d r e n has
prevented epidemics of measles and other childhood diseases.
�I n Croatia and Bosnia-Herzegovina, we support 20 l o c a l
organizations, i n c l u d i n g women's groups, community
organizations and l o c a l voluntary organizations, t o a s s i s t
war refugee trauma v i c t i m s and r e u n i t e f a m i l i e s separated by
the c o n f l i c t .
I n Romania, emergency assistance was provided t o many of the
100,000 i n s t i t u t i o n a l i z e d c h i l d r e n . Nearly 2,500 c h i l d r e n
under three years of age have received r e h a b i l i t a t i o n
assistance, and 147 c h i l d r e n have been placed w i t h Romanian
and American adoptive parents.
Health:
To r e s t o r e vaccine production, U.S. firms are p r o v i d i n g raw
m a t e r i a l s and inputs f o r production of measles, p o l i o and
DPT vaccines, and t r a i n i n g i n sound manufacturing p r a c t i c e s .
The U.S. FDA i s a s s i s t i n g i n vaccine q u a l i t y c o n t r o l and
r e g u l a t i o n . F e a s i b i l i t y studies f o r p o t e n t i a l p r i v a t e
sector investment i n new production f a c i l i t i e s have been
completed.
31 Partnerships between U.S. h o s p i t a l s and h e a l t h f a c i l i t i e s
i n Central and Eastern Europe and the NIS are d i r e c t l y
improving the q u a l i t y of medical care i n c i t i e s throughout
the region. To improve emergency care, ten such
partnerships have improved ambulance services, emergency
room and i n t e n s i v e care i n Russia, Ukraine, Belarus,
Kazakhstan, Georgia and Armenia. Other partnerships i n both
CEE and the NIS are improving treatment of c h i l d r e n w i t h
leukemia, improving nursing standards and s k i l l s , and
updating medical management.
I n Central Asia, women's access t o f a m i l y planning services
i s being expanded by development o f commercial supply
systems f o r modern contraceptives and t r a i n i n g o f h e a l t h
care providers.
Under the PROJECT HOPE Health Care Partnership, a p e d i a t r i c
cardiovascular team from Boston Children's H o s p i t a l i s
h e l p i n g t o e s t a b l i s h high q u a l i t y treatment c a p a b i l i t y i n
Slovakia. I n the f i r s t e i g h t months of t r a i n i n g , i t i s
reported t h a t the number of c h i l d r e n abroad f o r heart
treatment was reduced by 90%. P r o j e c t HOPE has increased
cardiology services; the w a i t i n g time f o r surgery has been
shortened; and the h o s p i t a l m o r t a l i t y r a t e has been reduced
from 12% t o 5%.
Environment:
Technical advisors have helped r e s t o r e the water supply
system and wastewater system f o r the C i t y o f Yerevan, a
�system that provides service to approximately 50% of the
Armenian population.
In the Central Asian Republics we have launched an Aral Sea
I n i t i a t i v e which i n i t i a l l y focuses on providing potable
water to the most affected populations. Follow-up work w i l l
include TA on water resources management.
The World Environment Center i s introducing new technology
for decreasing industrial wastes. This helped the largest
refinery in the Czech Republic to decrease carcinogenic
emissions by 72% and w i l l also help this company to save
over $130,000 yearly in production costs. Also in the Czech
Republic, the U.S. capitalized with $10 million dollars in
local currency a fund to undertake environmental a c t i v i t i e s
and investments.
In Poland, the Oswiecim chemical works realized a 90%
reduction in emission of vinyl chloride and an annual
savings of $2 million by application of r e l a t i v e l y
inexpensive technological changes. Replicable energy
efficiency demonstrations in multi-family housing in Krakow
are expected to r e a l i z e energy savings of 30-35%. The
r e c e n t l y - i n s t a l l e d sulfur scrubbers at the Skawina power
plant near Krakow are predicted to reduce sulphur dioxide
emissions by 80% — from 4,000 tons to 8,000 tons annually.
�Annex B
Analysis of Wall Street Journal Articles
on Poland and Russia
The WSJ a r t i c l e s provide some f a i r c r i t i c i s m and point out
shortcomings of our assistance efforts. We are working to
improve our program in the light of such analysis. At the same
time, the a r t i c l e s indulge in unfounded c r i t i c i s m and overlook
positive data. Following i s a point-by-point discussion that
c l a r i f i e s mis-impressions l e f t by the a r t i c l e and indicates
actions we are taking to address j u s t i f i e d c r i t i c i s m s . The
discussion i s organized into three sections: strategic issues,
delivery capacity, and contract-related issues.
Strategic Issues
O
Assistance was "scattershot": Early i n our assistance
programs, we were concerned with speed. The p o l i t i c a l
imperative to demonstrate v i s i b l e American support overly
directed the program toward targets of opportunity. Further,
we tended to develop programs without adequate consultation
with recipient government. We now employ country strategies,
based on ongoing consultation with host governments, to
tighten our programmatic focus. Strategies are i n place and
updated annually for a l l the CEE progreuns. We have an
approved strategic framework for the NIS and are f i n a l i z i n g
the country strategies. As we review these strategies, we
continue to look for opportunities to focus assistance and
bring less successful ventures to closure.
O
The U.S. should have dispensed with i t s targeted aid and put
more resources into "direct grants:" The a r t i c l e implies that
the U.S. funds only technical advisors to the CEE and NIS.
The program i s much more diverse. We have provided $2.5
b i l l i o n i n humanitarian assistance to the NIS since 1992. In
FY 1994, the U.S. w i l l provide about $7.3 b i l l i o n i n t o t a l
resources, over $4 b i l l i o n of which i s in USDA, OPIC and EXIM
c r e d i t s . Targeted technical assistance and training (about
$1.7 b i l l i o n i n FY 1994) i s an intentional second phase of the
program. As the a r t i c l e states, our goal i s indeed "to
stretch aid dollars by teaching Russians how to p r i v a t i z e
their industries and cobble together a free market economy."
This transition, beyond humanitarian aid and targets of
opportunity, needs to occur i f our assistance i s to have a
s i g n i f i c a n t impact i n Russia (with an annual GNP about $400
b i l l i o n ) and other countries in the region.
O
Assistance has not done enough to "allay mass poverty" or ease
"the economic strains on ordinary" people: Assistance was
never designed to erect an entire safety net. The West never
contemplated transfers on such a scale, nor engaged i n
�r h e t o r i c suggesting otherwise. We never claimed the
t r a n s i t i o n would be p a i n l e s s . Indeed, as the West knows from
i t s own recent experience, economic adjustment i s p a i n f u l .
Nevertheless, we w i l l provide t e c h n i c a l a s s i s t a n c e to help CEE
and NIS countries implement reforms to phase out mass
s u b s i d i e s and t a r g e t the s t a t e ' s a s s i s t a n c e to v u l n e r a b l e
groups. This i s a new s t r a t e g i c d i r e c t i o n i n our programs
emanating from t h i s Administration.
O
A s s i s t a n c e has not granted any " p o l i t i c a l breathing space:"
I t i s f a r too e a r l y to t e l l whether t h i s i s true and the
statement i s f a r too f a c i l e a judgment. I n Poland, where the
r e f o r m i s t government l o s t an e l e c t i o n , the new government has
not r a d i c a l l y departed from the t r a i l already blazed.
Moreover, Poland i s r e l a t i v e l y s u c c e s s f u l — having achieved
p o s i t i v e growth i n 1993, with unemployment below e a s t e r n
Germany and comparable to western Europe — a b a s i c point that
i s missed i n the WSJ a r t i c l e s . The new Russian government
continues to advocate reform, even though we remain concerned
about t h e i r a b i l i t y t o achieve the macroeconomic d i s c i p l i n e
needed to s t a b i l i z e the economy.
O
Under the Marshall Plan the U.S. "found i t more e f f e c t i v e and
cheaper to bring 26,000 European business and s o c i a l leaders
to the U.S. to l e a r n r e b u i l d i n g s k i l l s , which they then
brought back to Europe." The a r t i c l e does not mention that we
are proceeding r a p i d l y with t r a i n i n g programs, as w e l l as our
t e c h n i c a l a s s i s t a n c e a c t i v i t i e s . Over 8,000 l e a d e r s , business
people and students came from the CEE and NIS on t r a i n i n g and
exchange programs i n 1993. We plan to send another 20,00025,000 on such progreuns over the next two y e a r s . But we are
a l s o cognizant of the urgency of the moment. Reformers need
help now. The t e c h n i c a l advisors we place i n the f i e l d are
conducting on the job t r a i n i n g with immediate impact on
thousands of counterparts.
D e l i v e r y Capacity
O
"Rhetoric of generosity": Expectations of Western a s s i s t a n c e
were r a i s e d which could not p o s s i b l y be met. Western
o f f i c i a l s may have overpromised, but they no longer engage i n
such misleading r h e t o r i c . As you know, we have performed w e l l
on our commitments a t the Vancouver Summit, and we have
s i m i l a r t r a c k i n g systems for new commitments under our
supplemental a s s i s t a n c e package.
O
Some a s s i s t a n c e , "laden with c o n d i t i o n s , " never reached the
country i n questions, or the people i n need: P o l i t i c a l
c o n d i t i o n a l i t y i s c o n t r o v e r s i a l , but we i n s i s t e d from the
outset that CEE governments had to maintain t h e i r commitment
to reform; a s s i s t a n c e would be f u t i l e otherwise. Our guiding
p r i n c i p l e s i n the a s s i s t a n c e program have been four
�conditions:
— conunitment to p l u r a l i s t i c democracy,
—• conunitment to market economies, with an a c t i v e p r i v a t e
sector,
— observation of human r i g h t s , and
— the d e s i r e t o pursue f r i e n d l y r e l a t i o n s with the U.S.
We b e l i e v e such minimal c o n d i t i o n a l i t y i s s t i l l appropriate.
In p r a c t i c a l terms, these conditions have not delayed
b i l a t e r a l disbursements, but they have caused us t o s h i f t
resources t o the c o u n t r i e s that were b e t t e r performers.
C o n d i t i o n a l i t y has been an important determinant of
m u l t i l a t e r a l disbursements.
O
Programs have been slow to d e l i v e r : We agree t h a t "Western"
a s s i s t a n c e has been slow to a r r i v e , often due t o the
c o n d i t i o n a l i t y i s s u e s discussed above, but U.S. a s s i s t a n c e has
been extremely quick to plan and execute programs and d i s b u r s e
resources. For example, we opened the American U n i v e r s i t y i n
B u l g a r i a ( a completely new i n s t i t u t i o n ) i n 11 months, from the
f i r s t informal d i s c u s s i o n to the s e l e c t i o n of students and
opening of c l a s s e s . Throughout the NIS, we are g e t t i n g
p r i v a t i z a t i o n a d v i s o r s on the ground w i t h i n 30 days of
r e c e i v i n g a s s i s t a n c e requests. We obligated 100% of our $1.6
b i l l i o n i n commitments a t Vancouver by the end of 1993.
O
Coordination among donors has lagged: The West never
developed a coordination "command center." Coordination has
indeed been f r u s t r a t i n g a t times. Experience has taught us
that the G-24, designed as a kind of "command c e n t e r , " has not
been e f f e c t i v e . We have begun moving aspects of the
coordination function i n t o the f i e l d , e s p e c i a l l y i n the realm
of democracy b u i l d i n g . U.S. embassies i n Warsaw and Poland,
for example, w i l l coordinate G-24 democracy-building
a c t i v i t i e s . For R u s s i a , we have s h i f t e d key c o o r d i n a t i o n
i s s u e s to a more manageable G-7 forum. We continue t o
encourage the World Bank to play a more proactive c o o r d i n a t i o n
r o l e for the other NIS c o u n t r i e s .
Contract Related I s s u e s
O
"Groups l a c k i n g American partners didn't make the c u t : " This
c r i t i q u e c o r r e c t l y highlighted our i n a b i l i t y t o make d i r e c t
grants t o indigenous NGOs who uniformly did not meet USG
f i n a n c i a l management and a c c o u n t a b i l i t y standards.
Instead,
we matched indigenous NGOs with American PVOs who could
t r a n s f e r s k i l l s and b u i l d the c a p a c i t y of t h e i r p a r t n e r s . We
are about t o s t a r t a new program i n R u s s i a that w i l l t r a i n
l o c a l NGOs i n management, accounting and fund r a i s i n g and thus
i n c r e a s e t h e i r a b i l i t y to obtain funds from f o r e i g n and l o c a l
donors. I n CEE, we developed a "Democracy Network," which
�focuses heavily on developing indigenous national and regional
private voluntary organizations. We recently created a small
grants program to be managed by our embassies, which w i l l make
awards to local c i t i z e n s and organizations in CEE.
O
Money i s wasted on consultants who " f l y in and out":
Shortterm advisors did absorb a significant portion of the
assistance budget when the CEE program was launched. We b u i l t
on this lesson to reduce reliance on short-term consultants in
the NIS and to focus them on specific tasks that require
special expertise. Both the CEE and NIS progreuns now u t i l i z e
long-term advisors, eschew the "seminar approach," and are
more concerned in building indigenous capacity. We started,
for example, with one Russian for every foreign advisor on the
Russia privatization program. The rate i s now 4 to 1.
O
U.S. advisors were inexperienced: This fact serves more as a
commentary on the closed nature of the eastern societies
during the communist age than on the flawed nature of the U.S.
advisors in the post-Cold War era. In examples cited in the
WSJ, advisors learned quickly and modified their approaches
successfully. A growing body of experience in the region w i l l
gradually obviate this c r i t i c i s m .
O
Assistance generated "a veritable feeding frenzy:" I t i s true
that 1,200 firms and individuals expressed written interest in
submitting proposals to participate in the NIS p r i v a t i z a t i o n
program. This i s a compliment. I t shows that we are reaching
out to get the best American expertise. Moreover, i t i s such
intense competition that helps us keep costs down and keep
salary rates, for the most part, capped at $331 a day for
individuals who normally b i l l 4 or 5 times that amount.
O
Our contracting approach creates "redundant capability"
because "tasks haven't been worked out": We have developed
new contracting approaches for the NIS. We contract for
s p e c i f i c technical s k i l l s we know we w i l l use.
Concurrently,
we work on designing s p e c i f i c a c t i v i t i e s on the ground. We
move both processes, contracting and a c t i v i t y design,
concurrently, cutting off 6-9 months i n normal implementation
time. When contractors are put on the ground, they have a
precise scope of work that supplements the basic contractual
document that secures t h e i r technical services.
�Annex C
Excerpt from 1993 NIS Annual Report
ASSESSMENT OF EFFECTIVENESS OF U.S. ASSISTANCE
TO THE NEW INDEPENDENT STATES
OVERVIEW
In 1993, as the New Independent States struggled through the
second year w i t h the colossal problems of t h e i r Soviet legacy,
United States Government (USG) assistance e f f o r t s t o the NIS
began t o s h i f t t h e i r center of g r a v i t y , away from humanitarian
r e l i e f and towards t e c h n i c a l programs designed t o make the
journey toward democracy and the market more stable and d i r e c t .
Q u a n t i t a t i v e l y , across the NIS as a whole, U.S. expenditures on
humanitarian a i d (mainly food) s t i l l predominated.
As of
December 1993, cumulative o b l i g a t i o n s under that r u b r i c had
reached $2.6 b i l l i o n , vs. $591 m i l l i o n on technical assistance
p r o j e c t s . For the l a t t e r , 1993 was the year of taking root.
In 1994, they should s t a r t t o bloom.
D i s p a r i t i e s i n c o n d i t i o n s , customs and reform-mindedness across
the eleven time zones and twelve nations of the ex-USSR have
caused acute unevenness i n the s u i t a b i l i t y and reception of USG
t e c h n i c a l assistance programs there. At the p o s i t i v e end of
the spectrum i n 1993 were the Kyrgyz Republic, Moldova,
Kazakhstan a n d — f o r a l l i t s special u n c e r t a i n t i e s — t h e Russian
Federation. At the spectrum's other end were Uzbekistan and
Turkmenistan, whose p o l i t i c a l leaderships have f o r the moment
delayed s i g n i f i c a n t p r a c t i c a l movement i n the d i r e c t i o n of
democracy and the market. I n Ukraine, lack of w i l l t o reform
w i t h i n the n a t i o n a l leadership has f r u s t r a t e d the high hopes
held i n the e a r l y days of independence i n 1991, and l i m i t e d USG
aid d e l i v e r i e s . An analogous s i t u a t i o n holds f o r Belarus.
S t r i f e i n T a j i k i s t a n , Georgia and Armenia has l a r g e l y precluded
implementation of USG programs there, other than humanitarian
ones. Section 907 of the FREEDOM Support Act contains a
p r o h i b i t i o n on assistance t o the Government of Azerbaijan (GOA)
u n t i l the President determines that the GOA i s taking
demonstrable steps t o cease a l l blockades and other uses of
force against Nagorno-Karabakh and Armenia; consequently, USG
aid t o the displaced Azeri population i s provided v i a
i n t e r n a t i o n a l and p r i v a t e voluntary organizations.
Conscious of t h i s regional unevenness i n w i l l i n g n e s s and a b i l i t y
to absorb USG assistance, and aware t h a t f u t u r e USG aid w i l l
not approach FY-94 s e x t r a o r d i n a r y l e v e l , the Coordinator's
o f f i c e w i l l work w i t h implementing agencies to better focus
resources on sectors most c r i t i c a l t o successful reform and t o
sub-regions where preconditions seem best t o promise prompt,
v i s i b l e payback.
,
�-2- Impact The scope of USG aid programs i n the NIS i s without precedent.
Tangible impact i s already v i s i b l e :
In the sphere of p r i v a t i z a t i o n , the Russian government, w i t h
assistance from USAID c o n t r a c t o r s and U.S. co-financing of
p r o j e c t s managed by the I n t e r n a t i o n a l Finance Corporation, has
t r a n s f e r r e d from s t a t e ownership enterprises i n most of Russia's
89 regions. The c r i t i c a l job of economic r e s t r u c t u r i n g s t i l l
l i e s ahead, but U.S. t e c h n i c a l assistance to the Russian State
P r i v a t i z a t i o n Program has been indispensable to the l e t t e r ' s
success to date.
In the sphere of democratic i n s t i t u t i o n - b u i l d i n g , U.S.
assistance has helped Russia introduce t r i a l by j u r y i n nine
regions f o r the f i r s t time since 1917—an important s t a r t i n
e s t a b l i s h i n g e f f e c t i v e r u l e of law. U.S. non-government
organizations have also influenced the d r a f t i n g of laws,
regulations and procedures to support democratic market systems
i n several NIS, w i t h the American Bar Association's review of
Kazakhstan's d r a f t c o n s t i t u t i o n being a notable example.
Person-to-person programs have served as an important element
of a l l NIS assistance e f f o r t s . A range of t r a i n i n g and
exchange programs, and farmer-to-farmer, Peace Corps, and IESC
volunteers, have had d i r e c t personal impact on the ground at
farms, firms and business centers. Hundreds of v i s i t i n g NIS
students, teachers, businesspeople, s c i e n t i s t s and leaders have
been exposed to democratic market systems. Western values, and
management systems.
Emergency food, f u e l and medical humanitarian assistance—such
as the supply of vaccines and cold-chain equipment which have
reached 500,000 c h i l d r e n i n Central Asia, or the supply of
heating f u e l to Armenia--have helped address the human costs of
economic and p o l i t i c a l change i n the NIS. Recognizing the need
for emergency and humanitarian assistance i n the Caucasus and
T a j i k i s t a n , the U.S. has taken a lead r o l e i n engaging
i n t e r n a t i o n a l organizations to undertake programs i n these
regions, and to issue appeals to other donors.
In the energy sphere, e f f i c i e n c y improvements i n d i s t r i c t
heating systems of seven c i t i e s i n Armenia, Belarus,
Kazakhstan, Kyrgyzstan, Russia and Ukraine have demonstrated
the p o t e n t i a l f o r energy savings of up to 30 percent i n systems
which account f o r a major p o r t i o n of energy use.
�-3- Problems At the same time, e f f e c t i v e n e s s i s constrained by the very
d i f f i c u l t operating environment.
Inadequacies i n the banking
system and commercial law—themselves a target for r e f o r m —
complicate d e l i v e r y of assistance. Payments are d i f f i c u l t
without r e l i a b l e banks. Contract enforcement i s problematic.
O f f i c i a l agreements w i t h bureaucracies can have l i t t l e force.
Contractors report regular d i f f i c u l t y i n matters as simple as
standard accurate i n t e r p r e t i n g and t r a n s l a t i o n s .
A l l implementors report d i f f i c u l t y i n determining where i n the
power s t r u c t u r e ( f e d e r a l or l o c a l ) r e s p o n s i b i l i t y l i e s f o r
approving p r o j e c t s or r e s o l v i n g p r o j e c t - r e l a t e d snags. This
leads i n t u r n t o l o g i s t i c a l snafus i n spheres ranging from
contract compliance t o g e t t i n g visas, securing local ruble
rates f o r transport and other services, etc. A d d i t i o n a l l y ,
most regions r e t a i n enough of the o l d communist p o l i t i c a l
s t r u c t u r e and mind-set t o block or s e r i o u s l y impede reform i f
they choose. Our a b i l i t y t o mount a s i g n i f i c a n t p r i v a t e sector
program i n Ukraine, or s i g n i f i c a n t democratic development
e f f o r t s i n Uzbekistan or Turkmenistan, i s severely l i m i t e d by
those c o u n t r i e s ' o v e r a l l reform stances. While reform prospects
i n Kazakhstan are much b e t t e r , even there the l i m i t e d number of
p r i v a t e farms has made i t d i f f i c u l t t o place a g r i c u l t u r a l
storage f a c i l i t i e s under an a g r i c u l t u r a l p r o j e c t ; i t thus
became necessary t o r e d i r e c t p r o j e c t e f f o r t s to other c o u n t r i e s .
In Russia--where the environment has been conducive to good
performance i n many a r e a s — t h e p i l o t O f f i c e r s ' Resettlement
I n i t i a t i v e revealed the complexity of obtaining agreement at
the l o c a l l e v e l on c o n t r i b u t i o n s of land and i n f r a s t r u c t u r e ,
and the lack of enforceable c o n t r a c t law. Construction
contracts at some s i t e s have hence been cancelled. This
experience has given important lessons t o be applied i n the
larger resettlement e f f o r t t o be undertaken i n 1994. Analogous
d i f f i c u l t y i n reaching agreement w i t h l o c a l a u t h o r i t i e s has
prevented USIA from o b t a i n i n g a s i t e f o r i t s planned America
House i n Vladivostok, and delayed s t a r t s i n Almaty and Kiev.
A l l these circumstances r e i n f o r c e the need for continuous
monitoring by personnel i n the f i e l d .
On the U.S. side, some systemic weaknesses i n design or
implementation have also emerged. These include:
1) F a i l u r e t o reckon w i t h l o c a l r e a l i t i e s . Some p r o j e c t s have
suffered from a r e f u s a l t o recognize t h a t models which might
work i n the U.S., Eastern Europe or the Third World are not
�-4f e a s i b l e for the NIS. More j o i n t planning with NIS counterparts
would better meet local reform needs. The recent development
of country program s t r a t e g i e s should help us focus resources on
a c t i v i t i e s which c o n t r i b u t e to fundamental s t r a t e g i c goals;
2) F a i l u r e to heed or seek input from Embassies and missions,
and t o keep them adequately informed about the status of major
p r o j e c t s . Because of the p o l i t i c a l implications of aid to
Russia, Washington w i l l i n e v i t a b l y develop programs, and i n
many cases be responsible f o r implementation. The f i e l d ' s
e x p e r t i s e and country knowledge should be put to greater use,
however, at design, pre-approval and implementation stages.
3) "Seminar syndrome", meaning lack of follow-through a f t e r
short-term v i s i t s or t r a i n i n g programs. This has c o n t r i b u t e d
to the impression ( i n c l u d i n g among area reformers) that USG
funds go largely to t r a d i t i o n a l , high-priced consultants whose
e x p e r t i s e i s inadequately relevant to the NIS, and who engage
i n "developmental tourism" more apt to strengthen resumes than
support reform. A regular complaint from NIS o f f i c i a l s i s that
t e c h n i c a l aid consists of too many assessments and too l i t t l e
act i o n ;
4) I n d i s c i p l i n e and f a i l u r e to consult with other USG agencies
engaged i n assistance. This leads to d u p l i c a t i o n v i s - a - v i s not
only other b i l a t e r a l programs but also separate USG agencies.
A major Embassy comments that sometimes USG aid v i s i t o r s appear
to have had no contact w i t h the rest of o f f i c i a l Washington and
make promises to the l o c a l government that they cannot keep, or
that i n t e r f e r e w i t h ongoing programs.
CONCLUSIONS
I . A wide array of USG t e c h n i c a l assistance programs and p i l o t
p r o j e c t s were undertaken i n 1993. Future USG assistance i s not
l i k e l y to approach the e x t r a o r d i n a r y $2.5 b i l l i o n l e v e l of FY
1994.
Pruning or weeding out weaker programs, and those which
do not d i r e c t l y c o n t r i b u t e to our s t r a t e g i c o b j e c t i v e s , i s
needed to assure that funds are a v a i l a b l e f o r a c t i v i t i e s w i t h
top p o t e n t i a l impact. Addressing problems which l i m i t
effectiveness and are w i t h i n the c o n t r o l of the USG i s thus a
high p r i o r i t y . The main lessons learned to date include the
following:
Proposals must be b e t t e r vetted f o r overlap w i t h those of
i n t e r n a t i o n a l i n s t i t u t i o n s or other U.S. Government agencies.
(The appointment of a Director f o r the Support Implementation
Group of the G-7 may prove b e n e f i c i a l i n t h i s regard.)
�-5Programs w i l l be v i t i a t e d by a short-term approach on the
part of the a i d - g i v e r , or by a lack of e f f e c t i v e , sustained
personal contact w i t h the r i g h t NIS counterparts. Programs
need to be planned w i t h a longterm perspective, and t o receive
e f f e c t i v e , sustained personal support from the counterparts.
And, as one Embassy summed up: "Much w i l l depend on
whether the p r i v a t e - s e c t o r U.S. partner w i l l engage i n
s i g n i f i c a n t follow-up a f t e r the o r i g i n a l work i s f i n i s h e d . . .
follow-up w i t h the ( l o c a l ) side i s c r u c i a l i f t e c h n i c a l
proposals, reforms and improvements are going t o have a l a s t i n g
effect".
II.
(i)
I n 1994, the Coordinator's
O f f i c e w i l l work t o :
improve and focus program design on s t r a t e g i c p r i o r i t i e s ;
( i i ) prune—and, when c a l l e d f o r , eliminate—programs which
have f a i l e d to prove themselves, so as to preserve funding f o r
those most l i k e l y to succeed;
( i i i ) channel these superior programs i n t o a set of
r e f o r m - f r i e n d l y sub-regions;
( i v ) encourage b e t t e r coordination i n the f i e l d ( i n c l u d i n g
w i t h NIS c o u n t e r p a r t s ) , i n Washington, and w i t h the
i n t e r n a t i o n a l donor community.
�AM Wttboot GMdtet
Poland ought to be aid's showcase.
Breathless promises, however, pr
First to revolt, this country got m r care duced winded deliveries. Aid wu n t on
oe
o
and was promised more cash than any poorly thought through, there wu less o
other place in tbe old But Bloc besides than the Poles were led to believe, and
RunU itaetf. By early 1990. It had gladly t o forever to get here.
ok
net the bndal economic austerity that
Bven loans arrive b slow boat. Th
y
Russia stillresists.Poland freed prices, Buropean Bank hu dispensed just 1%
5
cbecfced Inflatkm. beat receastoo.
MO mlllioo it pledged to Poilsb ventu
O
Yet the West, reluctant to give hand- The Wbrid Bank and others have mrom
outs or take big-risks, has withheld large- fed themselves to lending 8.5 b L n
Uo
scale aidtothe smafl twtoews that are telephones and gufleMsand railroads
Not, Mostly, to the Poles; 'JheUng Poland's trtnsform&tloo; mllUoos the Poles estimate that fl bUlton of it t
Nortfdthe West channel a tt
M budged. Under
attached by
The Advisers Got Some, go It alone.any easier for millions more asnon, more thanconditionscountry's pot*&
make Ufe
half the
B e po
Dm t
shot
weUare dal credit* mist
Some Was Never Sent crumpledymentliving up to 19%.collapsed. exports -fromcorobe spent on Wester
to economists-a prac
and
standards
I V b to One: Tbe West has been dee called "tied aid" long frowned on
ot m
(he Third World.
Mingy. Strip out canceled debt,
Lend to Business? Too Risky grants that go undlspersed.plus toau Tbe West's more generous grants don
and
and pun
gifts to Poland come to under 1% of the 1 o e any faster. Of SI billion promised
0
3m
c5
b U o total When a highway costs S the European Union (the former Burope
Uo
4
By BxittY NEWMAN
btllion and cleaning the air ISO bUtkm, Oommunity). 3% hu arrived. Anotlx
0
Slajf Rrportrr of T m WALL STmrrr JoumMAL
Poles can feel rooked.
tt.5 billion isn't fresh m n y at all;
oe
WARSAW-The Idea wu to do it fut. to
u p
do it cheap, to make It pay and to make It lite Impact came dear last September. cancels debt that Western banks p m
0
•tick. Designed and underwritten In tbe Three months before the Russians gave ainto Poland 2 yean ago. An unused 1
billion fund meant to steady the iloty i
West, the restoration of capitalism In shocking decdoo victory to the far right,
tbe Poles voted In the o left. Pbnner still in U b Instead of being distributed
M
mo
Bastern Europe would be. in 1 9 rhetoric,
90
the task and the triumph of tbe century. Communists run the government today, agreed to Poland's banks.
and
Businesspeople were going to put the vic- bold u many seats tn Parliament as Excuses for the delays abound on b
99
p
tims of communism back into business. they did after tbe rigged 1 * election. sides. Paperwork holds u everything, du
u much to rusty Communist laws u i
People like Barbara Lundberg. She wasAn OM World Order
oe
3 in 19S9, a Wharton M.B.A. and a former Not every Western cent has g n for Western fears of real or Imagined trau
6
vice president at Kidder, Peabody A Co. naugtit, of oourse. Plenty of Polish busi- The World Bank makes credits cooditioa
on progress in reforms.
N w she's at work in the old Central nesses and burtaucrtdca havfr~g|teed panies decline loans theyPolish state co
o
dearly need b
fromiMnitM^owledglng this, tboifets.
Committee Building of Poland's C m u
o mhave come to feel that aid hasfear they can't handle.
)
nist Party, running tbe U.S. goverament'
a M part in their escape toy^ But if there is one thing the West I
t
tan. "I knew nothing about Poland." she"capitalism. "With or wlthouTaglgaart; delivered quickly and In abundance, it
Eife beeuabK lbifirtrefonus advice.
•ays. "I wanted to get back into venture ^
and reach the point we're at now," says
capital."
A GrMn Revolution
Pawel SamecM, w o
h
Barbara Lundberg is no aid worker, but tracking Western runs Poland's office Revolution wu still rolling tenss Ku
for
grants. "It's an illuwhen the West recruited an army to m p that foreign rM Is changing the en Europe w e the West's advisen t
o
hn
>
sion
gan pouring into Warsaw. They entered
economic situation in the Bast."
worid n n of them knew, and t o on J
oe
ok
First of two articles
The iDusioc had a Joyous birth. On Nov. o one o u tell them h w to do. b
n
oM
o
uh
up after the Gold War. it didn't want aid15. 1989. Lech Walesa, not yet Pound's hindsight, m c of their work seems naln
wu
private dtlzen to h n
workers. It wanted a corps of corporate president, Jointthe first ct the VJ&. Con- W e their advice wu on target. Pok
address a
session
n m e by communism often didn't ta)
u bd
role models-coos ul tan ts, bankers and engress In 1(6 yean. Recalling StaUn's re- IL But nothlQg hu stopped tbe advise
trepreneurs- to clinch a friendly takeover.fusal to let Poland take part in the Marshal)
from charging their usual fees, paid fo
With n n w enemy shaking (ts missiles at
o e
Plan, be saM. N w the m m n
o et
Western aid, and helping themselves .
Europe, Western leaders were convinced Bastern Burope" o isan Investmentwhen
of least u much u they have helped Pi
that business would soon b o and pros- kind . . . anawaits
om
Investment adequate to
perity bloom; the Communists would neverthis greatness of the American nadoo."
the
Steve Buckley wu In the San franct
be seen again.
Cheen and applause stopped M M office of BainftCo., a consulting fin
m
By early 1993, tbe 2 richestnadoos of
4
does. Oongren swiftly voted Poland andw e tbe wan f O In Berlin. At
hn
the West had made paper pledges of S O
THungary loir times what President Harvard MJLA.eand a yuppie's Si. be ha
salao
bilDoo to Bast European countries fromGeorge Bush had asked.
'Td have had a bardtimefinding POan
Estonia to Albania. Poland akne got a chit " e an started with tremendous opti- the map." be says. "But when the w
W
on
for&Sbmkn.
mism," says a manager at one aM agency.
came down. I said,-Gee. . . . ' "
What happenedtoIt? Pair question TDriDed by the potency of Poland's 1 9
9 0 He quit M J b and Ow to Warsaw
s o
e
given that tbe West n w must dedde price shock. Western governments
o
May 9 0 found some British and Amer
.
whether totowbillions more Into Russia'spected a torrent of private capitaltowaalf a1 9money, and startedridingtb
can M
fBiriftrofx).
away communism's slops
rails. " o o y had seen the inside of
Nbd
The answer Is discouragtag: A has that the whole system,fromcourts
M
Polish factory before." he says, or at lea
been fired like scattenhotat aflltdnrbird.
not many tile M . He visited 350. and to
m
Replacing commuhlam flth capitalism , banks, badto be scrubbed out be*** w n an a contract to "stop the bleeding
o
M
has been far trickier than tbe brkks-aad- ddal wave rase.
U 2 of them.
0
nortar salvaging of postwar Burope. Many
N b d knew much of anything. Beooy
eM Mian benefit donors more than cause they assumed the market would d He asked factory managen. "What d
o
Mi
e
donees. And many, laden with conditions, the wort, the industrialised worid's donor need?" The reply: "You t U ia."
• A year later. Mr. Buckley and tw
sit unused.
nadons and aM Institutions never set im utnen o e e a consulting firm, C m
a
pnd
o
Skimpier In quantity and quality than It think tank or command center to coordimy Assistance Ltd.. with an Irish offlo
appears. Western aid hasn't done enough ute a to (he Bsst Their purpose wu in
M
to promote mass enterprise or allay mass Nit poUdcsl: to put on iertangam tap tbe vein of grants from the Buropea
nkm. CAL hired 3 stafTen. mosth
6
poverty. Tbe market machinery It ts help- •how.andbiiyaquJctfU.
Mricans between college and buslnes
ing to install In many countries hasn't
provided the political breathing space to Missei-faire economy at great speed." tool. They piledfileboxes into tbe to
por of a student residence and g t d w t
o on
prevent theriseof a nationalistrightor a uys a Western consultant
wambling for w r against an armada o
ok
sodaJUt left.
West Pledged Billions
Of Aid to Poland—
Where Did It All Go?
�Tte d e wuted t 1 3 U.S. agenda:
d
n 4
But w o Is g o t t e ordinary Poles?
h
od o h
t e D p rm n o Labor, t e Securities HO^MTS Hi^p TYMHIMIVM
b e at e t f
b
N t t e BBRD. or a y o t e West's oh r
o h
n f h
te
a d Kxcbange Oommisslon. Rannle Uae. Just u aid for Western advice hu M public benefacton. T o mlllioo b sn
g
w
ut
Aid paid advisersfromt e U.S. a d t e B o ty aided Western advisen. Western
b
n b m sl
U
have started here since 1 8 . T e
9 9 hy
en
tell Poles bw t grade meat, tu p w r
o o
o business hu b e the biggest gainer from
e,
half t e wort force a d turn o t
h
n
u
t
h
M
burn blobrlquettes, plug Into e-maiL Theye West's buslneu loans. A agencies
t e national product Small entrepreh
h e r n u cd
a
explAln bw to confront x n p o i , stand- v a p o o n e preference for sa/e
o
e o h ba
are laying t e concrete o t e m dr
h
f h o eh oe
u p s d o ate,
ardlze measurements, run parliaments. bets. T e m n y they are s p oe t lend stable d m c a y the W s w ns
e or c
et a t
to
os
e
Packing 5 0 Poles Into a r o for a s d Inspire enterprise tn the Bast often g here. Yet, because they are considered
0
om
Oe
o s o hr
sbrw In English o g r e t lndustrr mto Westernen. or It g e n w e e at all.highriskhmosto t e can't g t a dm o
n amn
ac
f hm
e
i e f
s
dm e
roeconomics Is o e w y t scatter advice. Al M office window. A a d Sola Pool
n a o
Western credit
takes
n
Another w y Istowrite a report, advanc- In a vista of steeples a d warea
B R are o t f
BD
ae e
f
ing the transltioofromC m u it d u l houses. Be says, "This m k s m think o Direct loansfromthe difficult for us oo
o m ns o be
u t
Poland," b t his view is o L n o ' But a e Individual loans," says Yves Fortln.
u
f o d ns thekquestion. "It's very
talk to capitalist technoipeak.
Bnd, seenfromthe beadquarien o the m bank's administrator in Warsaw.
f
The n m s o BU advisory p o r m u o e
a e f
r ga s pa
n the '
read like a list o Iste-tnodel cars: T m u,er i pneBank for Reconstruction a d " ed lose o r shirt"
f
e pB v o m n
s
W
u
D e
L
Fiesta. Sierra. Their jargon-laden reports
But the EBRD's attempts to deal
o
favor things like restructuring sectoral Mr. Pool is M. and g t his UMJL atthrash md l m n d nt wort; t e w nt
de e o '
o
w
e
ao o stick theiri necks out. dtber. Th yH C '
c m o e t systems with market-orientedMIT. T o yean ago, h wu at S l m n
o p nn
b O
e
Brothers in Nw York, a private banker •ifflww u h n e commercial b n s hu
e
financing mechanisms In horlsontal tnstia dd
ak
e
tutiooalframeworkso competitive struc-with profits In mind. In London, b Is a
f
never b e passed o
n
public banker with Polish profits in mind.The BUetried,too.It ntoprivate business.
tural solutions.
asked Polish b n s t
ak o
Ms f y
o p ne
" a y times." Mr. Buckley recalls, " ot o m clients areforeignc m a i sdistribute 9 0 minion. They didn't T e
Mn
b
interested In Investing In Poland," b W rd B n 6also gave t o e b n s 30
e ol a k
" e pe said. ' h t d w k o a o t
po l
W a o e nw b u
hs
says, pouring a glass o spring water. million, and also flopped. a k 70
f
this?' I said. 'What's tbe alternative?' "
" o ' b surprised b w m n pass
Y ud e
o
ay
W o Istoblame? Westernen uy t e
h
h
Tools of Mtefortune
t r u h Heathrow."
ho g
o'
Ignorance wu n obstacle t consult- A tasteforCarrara marble that adornsPoles w nt take chances. The Poles uy
o
o
oh a
ants hired to rescue and sell state industry.e bank's halls drove his bank's presi- Westernen wont share the risk. B t m y
t
h
b
A BU adviser can m k tlJOO a day. d n, Jacques Attall, to quit last June: in e right
n
ae
et
b
Brussels a a d d 5 6 contracts w rh 18 three yean o existence, t e BBRD h d " h y shifted responsibility for t e
wr e 4
o t 26
its
f
b
a o rT e f
o e no
h
million in 1 9 ; Polish consultants g t half e t m r o constructing lavish bead-p o use o their m ny o t us." says t e
91
o s n oe n
p
credit chief o Poland's d v l p e t bank.
f
e eo m n
a percent o that Yet, a L n o adviser quarien than it had dlspenfed in loans. A
f
o dn
ak ol ae o
figures 9% of his Arm's Butern r v eu president a d a n w organlutkm Madej Stanczuk. His b n w ud h v t
0
e nw
e e
n
n
e
p y ak b
c m sfromaid agencies.
o e
chart are sorting things out, b t t e critics a b c t e aid-given If small borroweno
u h
h
%
Along with every otherfirmwr n in o ' stay mute. They uy t e premier defaulted. That's w y it hu lent just 5 f
oM g w nt
h
5
ol a k
Poland, CAL first expectedtoparlay t e
b Institution createdtospeed t e a v n o a S 6 million W rd B n credit. That
h de t f
aid m n y it g t for reviving state c m a
oe
o
o pcapitalism still d e m r for the W s bank. Mr. Stanczuk uys.e"creates Illu- for
o s oe
et sions" that Western m ny Is available
o
nies Into success fees forflushingo t t a t e Bast
u hn h
f
Westerners to b y them. Butrivalspu k d T e EBRD's record In Poland m k s itthe mass o Poles.
u
lce
b
ae
pu s like t e s a - o d r Industry, with o that way. The b n hu w a p d u 2 "Our procedures aren't t e Issue." relm
b o pp w e
l k
o
ak
r p e p plies Ian H m , w o b a s h e W rd B n
6
u e h ed t
h o
its ready-made domestic market F r tlxdeals. G v r m n borrowen a d o e
O
o en e t
n n in Warsaw. "If w disburse funds i Ina k
e
2 machine-tool and 3 s o c m a l chicken processor aside, t e rest have
8
5 h e o p ne
b
e
a n
o
that CAL hu tried toflogIn endless calls U et r partners, and b r o o bard Africa, w can d m sure d It in Poland."
W se n
or w n
e
ot e West, n t a single bid hu c m In. terms, u they wu fromany commercial Polish banks, h contends, scare off b r
b
o
o e
oM
e
o
" o o y here u d r t o t e unattrac bank. S m Westernen in Poland w n e rowen b d m n i g coOateral w rh
Nbd
n e so d h
o e
o d rtwice they m ua dn small-business t
a on o a
t f
loan.
tiveoess o Polish assets." Mr. Buckle bw this patternfluthe definition o aM.
f
o
f The
u e ed
says. "After five minutes o the p o cT e BBRD. they say, should b lending to Poles, says Mr. H m , n e "greater
o
bo h
e
courage" to take n e
e id
either you have a compelling story or It'
Poles, n ttoforeignen w o can g t their track record byo5nw customen d ne
o
h
e
a
4 yean o history.
f
'dick.'"
m ny elsewhere.
oe
n
To c m o n hisfrustrations,m n a " o can a y o y there say they w nt S the aM-glven a d Polish banken
o pu d
ay
Hw
nbd
o' o
n
f
unattractive Polish c m a y hu sa m b n o Polish companies?" says o e i bicker on. Meantime, o etinyminority o
o pn
lm e a k n
n
on o e
• t e receiver o his consultants. CAL, faW se n consultant. A d another: "They n w entrepreneurs hu at last f u d s m
h
n
et r
ds
'e
example, w oe a reporttarH d m t one e e sivposedtoblase trails, b t they d
rt
y o a, w r
u
o
n the w yto
market. h
o Its leu-hopeless machine-tool clients. joint ventures with Westernen. W y Be- cash odesigneda o k thefreee o t oT e
f
h?
newly
p c e it c m s u f
t o
The report wu full ct Ideu to dear t e wcauMtt'saafe."
h a^
y
betongBtoUndeSam.
tar prtvatlxation. W eh r or n t t e Mr. Pool sips his spring water.
ht e
o h
vice wu g o b c m a m o point,
o d ea e
ot
Funds snd Gflntes
•1 doot think w d very safe proje o
with m n aaotber consultant's report ects," h says. "Any project In Bastern W e the Bush W ie H ue set o t t
ay
e
hn
h o
Poland, this o e never f u d a reader B r p hurisk.I will d a dealforany deliver a totbe Bast.t It w st d t u r o
n
on
uo e
o
M
a e o po
n
c m a y that demonstrates c m ee c tom t enterprise in an enterprising way. Its
o pn
o ptne
oe
' TV g o n floorof Bydomat's
ru d
n a business and repay a ban. It h p e s e Ma wu the P UhA e l a Enter
m
a p nn w e
o s - m rc n
office o Wamw's e g displays a
n
de
ot
o p ne
prise Fund, inventedtofinancesmall
of CAL's Inspiration: A trader ha« that to date m s of those c m a i s have
buslneu while maximlilng profit for Itself
rented it u a s o r o toHp^Jj"? bete Westera."
h wo m
The BBRD sees Itself u a b a o in theand Its o n managen. B t Is maximlilng
ecn
w
u
and executive chain.
«*ugh,
vM
h a
h
tefunlturt la strictly Sa n - The nwo . notes Mr. P o are still leery of the an aM-vehlde's profit t e w ytohelp t e
tU W
e Bast, Western banks Only the BBRD, say
m xm m u b r f
l£rett«- Mr. Buddey t o g t b j m Its banken, lendso Lvital Western Inves- - a i u n m e o Polish entreprehuh e
neun? The answer. It seems, is no.
SoKSg with Is gone. Miroslaw PadudUn tors. Otherwise, to e w ud ' c m at
s m o l nt o e
o
In the eyes o the West's other aid
f
^oid guard's name, hu retaken the tn.
given, at least, the f n hu w r e
ud
okd
director's offle*.
^^
.
wooden. "It's t e m s successful effort In
b ot
•The worten' councflflredt e prrri- Reflections of Opportunity
h
Poland," uys
Hm f h
oi
ay
0
out m n g m n, h says. Doesnt this Yet m n do. At least 9 big foreignBank. Against Mr. o u e o t e W rd
a a e e t" e
his w small-loan record,
n
SedhUirelationship with CAL? M - c m a i s have Invested t2 blllkn in Po- the Enterprise Fund's n m e s shine. O
r o p ne
u b
Paduch's face darkens. "They doot wortland without the BBRD. Its banken as- tbe 3 4 minion b so e b rCbogreu. f
20
t wd y
for* now." h « ^ u s j sume, kr instance, that Britain's P M g hu sprinkled S6 emillion a o g 25 0 it
e
U n4
iwMrt. These materials doolfitPoun toowouM never havefloatedIts float-glassa But1t o e n m m n o '. 1
en a i .
o m ne
h s u b n d nt tell
e
^ ^ W u c h ^ U M ^
plant wt o t their W minion. PD n t n
tb u
l d go
d m t private for n w '"T^ioonwa, assumes It would. "Probably yes," says Its tbe fun story.
o a
o .
b saysV'lor drastic steps B e selling statep k s a , T f y Cove. " e w ne toget
e
k
s o e m n oa
W a td
p. 2
into Poland anyway. P o o BBRD. It's
or M
wealth."
1
1
v
W.J
.
It.
~J .
«—
u _ _
.
�"Thrw ytin t|0. cottrprlM hail
Poles are u fuspldous o banks u
f
• Ulty Americui tbe*." uyi Ms. Potiii banks an of them. Tbe Oedlt Corp.
A Direct Route
f
y
Unxftwrf, the fimd's fnenl dtrtctor scot its filer t every laundry In Warsaw. As the West en ten Its llWi year of consists o dropping b the embassy
o
q
" o o y Irotclned we'd miie mooey." All b t three Ignored It Tbey didn't k o tutoring Eastern Erope In the ways o i > annual reports.
Nbd
u
nw
f Tbe Poles have borrowed a *
Mtklnc money, botrrrcr. Is wttt tbt Its banken make bouse calls.
e
n oe
e
Bnterprtse Fund Is about, tod not jurt tar laundries always pay well." says Mr.capitalism, It may finally b learning o m o y and listened to a load ot lecb
kssoo: Recognizing that a g o chunk of West hu directed them toward c
od
tbe
Poles. Tbe sUly Idei wu to bin ml
Wasowskl, piahlng open tbe door of Ste-aid Is going to be dissipated oo Western
ism. In hindsight, they and m n
ay
capitalists to male smart tavestmeati.
taala Nocun's sunny shop. She washes eonmltants with no measurable results,
Once tbey paid off. tbe U.S. taxpayer could
trnen also n w accept that itapi
o
IOO
.
• dlsencafe. and the real capUa"itt would sheets now. and wants SO O for a cyperhaps It's better to let the Poles spendsdbcess of s m indr.tdua] aid e
It
o e
cleaning machine. The banken sit bar
get real mooey.
ior>rthlng meatier-moR direct gn
ODQgreu had the Imprtssloo that a
In January 1 9 . Hubert SilasxewskJ particular - might have tared Pt
90
on
S
salary ceiUng of tlM.000 a year would duly d w and gril bv for 4 minutes. All sbi at an empty desk In a ban state office. and Jobless much grief, given r
sat
poor
cu s o is a seribbled cash book. She tai B-year-oU lawyer raised tn the West be
hw
"IncendTiie" its U.BJL aid wnten.
A
room to theirfishfarmen and tc
n coUatenl. Shefinaglesbet taxes.
o
Not quite.
had returned to pitch tn u Poland tried writen, and helped avoid tbe four r
to
n
Tbe managen ID Polaod have found a A d she gets her loan. "Strang caab cope with the West's sudden benevolence.
political slapstick that finally brout
way to enhance tbelr rewards stUl further Bow, experienced owner." Mr. Wasowskl W need all kinds of assistance," be said
"
without offeoding tnyooe to Washlngtoo. says o Us way out "She hu g o coo e " O of It Is welcome. The delicateCommunists back.
o
o d then. A
After eoosulting with Ooocnas. they cre- tads. Probably, she bribes. W have n
Today, Poles have stopped wait
e
o put is making sun it Is well spent"
ated an bterprlse Fund done, the Psilsh p o e s with such a business."
Western aid to match tbe rbetc
r Mm
Ptlrate Equity Fund. This fund raised 81 Ihe Oedlt Corp. spprom 1 0 loans a Mr. Sdasiewtfj hu s desk piled withgenerosity that greeted their revo
9
paper today. Otbding a batch of aid activimillion fttn private investon. t o SO m ob this way, steering more mooey to
ok
Tbey would simply prefer m r tra<
oe
ot
mllUon of U.S. m o y t m tbe original
oe
ties,
that
o e fewer loans, more tn vestment ai
ordlnaryPolesthananyotberaldgtver.lt w d be still triestoseestU Istbe m o y Is
Enterprise Fund and got B mlllioo m r
O
oe
e
and that
tbe delicate
w ud lend m r If it bad more to lend. But spent -have to be nasooable," be advice. Experts still fly In to b
ol
oe
from an admiring EBRD.
Its parent the Enterprise Fund, gave it part "Youdooon often anoX "Poles Polish cherries, while Western dut
To run tbe new private fund, a managesays, but
Polish cherry exports. Tbe Poles c
2
2
ment firm wu formed. Its offlcen an theJust S 8 mlllioo. plus 1 0 miUiootoloans
should be tn charge," be says, but donon
wooder if a tariff cut wouldn't less
e
same people w o manage tbe Enterprise that can b re-lentto Poles. And the fund's
h
usually an.
absurdity. If a small loanfindsno '
e
Fund. Tbey make the same Investments n w partner, the Prtnte Equity Fund,
Poland's bureaucrats an no longer they ask, why not sugar It with a g
for both funds. If the private fund makeswon't give It anything.
unschooled in the ways of fOre'gn aid. Yet o es
the
h
good mooey, though, the oOcers get a
The nasoo Is that labor-intensive lend-tbe West wool allow them a major uy In J W s coal miner w o wantsto
car
piece of the profits.
ing at the grassrootsof Poland's nston- way aid Is used. Poles wait months for wash?
tbe
Tbe Washington a establishment
M
- Two yean ago, Poland asked tb
wasn't convinced this was entirely ethical. doo-a service no Polish bank can afford- EU to dear ideu tbey spprove. Their
tbe
think over such things. Cherrla s
"If you try to explain It. a lot o tbe U e wool make tbe kind of mooey that the sole brush with the U.S. aid program have no hope, but the car wash
f
m
Enterprise Fund's venture capitalists bethey don't understand," Ms. Lundberg
does: S 0 million In grants are
9
uys. " e had discussions with enormous here they need to make tbelr operedon
W
risingfromthe Brussels bureaucr.
sensitivity to the conflict-of lnterwl possi- self-sustaining In this extremely risky
makes Mr. Silaszewski feel u cc
frontier of capitalism.
bilities."
gnteful today u he did In 1 9 for
90
Washington did understand, tfaougti.
"They're looking for a 2% return."
0
ever goodwill the West hutooffer.
that the setup would help ease tbe U.S. out Marek Kuksynskl. the Credit Oorp's
uys
of spending much more o Polish tree Polish president "and from us tbey can't
n
Is 3 now. and four yean tbe wiser
6
enterprise. If the funds prosper, tbey sus-expect more than 4 . Don't forget, micro"Foreign assistance Isn't a pai
%
tain themselves. If tbe managen prosper, lending Isn't very profitable. W consider
he uys. "Here and there. It helps
e
they won'trashback to Wall Street Once it
Judging It by b w many millions an
o
ourselves a developroent Institution. Our
It's much bettertothink. 'Does thl
wu convinced that no ooe wu siphoning objective Isn't to earn mooey."
sense?'"
off money. Oongress wu happy. But b w
o
many Poles would be bafpy.too?N t
o
many.
The Enterprise Fund's boast of staking
2,510 companies with SIM mlUoo turns out
to be a tad misleading: in bet Just 4
3
companies got S O mlllioo. Itese tenderly
U
nurtured Investments rangefromSIS mllU n for a Polish-American printer d w to
o
on
$ 9 , 0 for a boat builder. Tbe other 24 7
1 90 0
,6
companies got their loans, avenging C4,000.froma much smaller Enterprise Fund
spinod. the Enterprise Credit Corp.
Stnal Wondore
What may be the prickliest Job - and
tbe greatest success - of (be whole SB
MU o aid effort fanstotbe young Poilsb
lo
banken who do the credit corporattoo's
scut work. Jerry GUniecky and SUwonlr
Wasowskl pass their days driving from
copy shop to dentisttobakoy. N w tbey
o
are showing off s place oo CUodu Street
that fbes Oats. Tbe owner borrowed SS0.M fromtbe Oedlt Corp. for a computer
0
tied German leak detector.
"From a sophisticatedflatfixer,we're
nroinf into a more sophisticated flat
fixer." the owner says. "Cappucdno?"
Acron tbe street in a rival repair shop,
HaUna Wisnlewska watches skeptically.
'Americans lending mooey?" she uys.
That's good, but Fd be afraid. You take It
and you don't sleep at night"
P.3
�TIIE V. J_L STREET JOURNAL THURSDAY. FEBRUARY 24. 1994
hopes to spawn a viable Russian pnvatelege, recently (old Ihe Senate Banking sector consulting operation that can then
Committee (hat Russian aid in the hands of win contracts from other foreign aid proU.S. consulianu a d 'beltway bandits'' viders, such u the Worid Bank.
n
benefits Russians • minimally, if at all."
• Citizens N t o k for Foreign Affairs,
ew r
He added. "I l o for a scandal d w the an agribusiness trade association, wu
ok
o n
road that's K m to upset the American hired by AID to help pick firms to advise
o g
taxpayer.
Russia's farm sector. It went on to pick
eight of Its own members to receive $ 34
2.
Spy Scandal
million in AID money. AID quickly ratified
Aid to Russia, already under criticism the group's choices, which Induded Monbecause of waste and meager results, faces santo Co.. Grand Metropolitan PLC's PillsXA/L I rpi
n
\MW
new pressures in the wake of this week's bury Co. unit ConAgn Inc.. W.R. Grace b
While Ifiey Keap MIIUORS spy scandal, in which M s o is alleged to Co. and Cargill Inc.
oc w
o
r> -x i- J. o J
P > - Intelligence official for
l o w i n g Capitalist oeeOS, secrets. Yesterday, lawmaken called for a Russians See Red
n
r« i i u r \ t.
' ^d to Russia until Moscow
The Russian backlash is predictable.
.
KUSSians reel Lett UUt cooperates with the U.S. in assessing the S m Russian offldals are beginning to
o e
____
damage from the affair, including with- flex their authority by exercising veto
. rp
t. t i r \
c
drawing from Washington a number of power over contracts awarded to U.S.
A 1 arget Ot Ire Uver spying Russian diplomats said to have been In- concerns. Russia's Privatization Center,
volved. (See page A3.) Ironically, though. for example, scaled back the AID contracts
any attempt to punish M s o by freezing awarded to Sawyer/Miller after Russians
oc w
By JOHN J. FUUCA
the aid pipeline would mainly hurt the began questioning the wisdom of its TVStaff Reporter of T M « W A L L SnirrxT JOUMNAL
droves of U.S. consultants who are deliver advertising campaign.
WASHINGTON - The U.S. has pledged ing the assistance.
"All of my friends were saying. " h
Wy
$5.8 billion in aid to the former Soviet
With so m c aid money Involved, are you putting those stupid ads on TV?'"
uh
Union, most of it destined for Russia: therethere has already been a veritable feeding explains Maxim Boycko. the 34-year-oM
is dancing in the streets - though not the fremy in Wuhington. The Agency for. economist w o runs the center. Mr. Boycko
h
streets of Russia. The chief celebrants? International Development, or AID. which also wu upset that the U.S. firm hadn't
Hordes of U.S. consultants who are g b is overseeing the bulk of the U.S. package, hired Russian experts to help plan the
obling up much of the U.S. aid pie.
says 12 0 consultants applied to get into project Sawyer/MlUer uys it believes it
.0
Consider one example of h w the the program, a record for the 33-year-old lived u to its contracts, but the matter hu
o
p
money is being spent: Last year, about 9%
5 agency.
raised eyebrows among other U.S. consultof Russian television viewers saw this
ants, w o recognize that the Russian
h
The American helpers
flash of loitallst enthusiasm. A camera cheap. Sawyer/Miller got S don't come agency is tbe funnel for about S 0 million of
9
7 million to put aid m n y each year.
closes ir i a cluster of schoolchildren in a together its ad campaign promoting privaoe
playground. "My dad Is a shareholder In a tization on Russian television. Mark MaiThe contrast ot struggling Russians
'
whole biscuit factory." trumpets a young loch Brown, w o oversaw tbe effort In and well-paid U.S. consultants is sharpest
h
boy. "So there!"
Moscow, also did s m self-promotion in at Moscow's Radlsson-Slavianskaya Hotel
o e
Por most Russians, commercials like Wuhington. He requested that AID pay One recent evening, a string quartet wu
this, produced by Sawyer/Miller Group, a him $ , 5 a day. not the S 2 that be wu performing In tbe marble-floored lobby u
11 0
30
getting, according to documents obtained •a crowd of American businesspeople|
Second of two articles
under the Freedom of Information Act . many of them aM consultants - dined and
AID refused. It allows consultants In Rus- drank in pampered splendor. In tbe freezWashington eoosulting concern, were the sia no m r than S 8 a day. whichrisesto ing darkness nearby, a hundred or so
e
30
first visible evidence of the U.S. billions about $o0 by figuring in pensioo benefits elderly men and w m n milled about tn
o e
8
0
that have begun toflowto Russia as part of
dirty slush, each trying to sell passenby a
a three-year aM package approved last and overhead.
prized beiooglng - a bottle of vodka or
year. And for many, the expensive, flashy Where Does the Money Go?
perhaps a favorite pair of shoes.
TV campaign couM be the last.
A look at other contracts gives an
For though the package is outwardly Indication of why Utile of the program hu ManhaUar Opposition
generous, in reality Utile of tbe money Is filtered d w to avenge Russians:
This is exactly the kind of dichotomy
on
targeted toward easing the economic
• KPMG Peat Marwidt assembled and that architects of the Marshall Plan, the
strains of ordinary Russians. Instead, re- manages five huge dusten of coosuitants postwar project that rebdtt Europe,
flecting nodoos that Russia needs experavoided by deliberately playing down the
garnered
tise, not handouts, tbe program seeks to that privatized$98 million in contracts to role of OS. consultants. James M. SUber
businesses.
stretch aid dollars by teaching Russians help
man. an SfryearcM World Bank consulthow to privatize their Industries and cobble • Bunon-Marsteller. the public-rela- ant and architect of Ibe Marshall Plan's
tions giant, is getting u to SIS mllUon for tecfanical-aM package, recalls that ptanp
together a free-market economy.
various schemes
This may wort In the kng run. But prise. One of IU to promote private enter nen foundttmore effective and cheaper to
jobs involved sending
short-term, it is galling to many Russians, teams on predawn treks to collective (arms hriny 2S,W EuropeantaminftsEf* fct*!
leaden to the UA to learn rebuilding
who And the UA attitude both patronizing near
ogr
o
and stingy-while enriching scores of U.S. pressNizhni N v oofd tn central Russia to skills, which they then brought back to
the benefits privatization to mllk- Europe. The notion of big-spending, wellconeuttants who are pocketing between m M brigades.
a
paid VS. consultants raking in aM "wu
5 % and 9% of the money In a given aM
0
0
contract With cash-starved Russians try- • Haglar BalUy. an Arlington. Va.. con- resented then and It Is resented even more
2
ing tojumjutart theirfledglingbusinesses sulting firm, won a S 0 million contract by now." Mr. SUberman uys.
4
and economy — and antireform poiitw^m luhing together 3 subcontractors, includAID'S tm toward American consultants
gaining ground - "we don't need 9% of ing four different law firms. "We need a lot is rooted In the agency's belief that Ameri0
tectmlcal-assistance money going to of redundant capability" because exact cans can best deliver capitalist expertise to
American experts." uys Aleksandr A. tasks haven't been worked out yet, ex- a country with few native notions of free
Jltnlkov. bead of a Russian commission plains Neils DeTerra. a vice president The enterprise. But there is also a political
firm plans to help privatize Russian utilicoordinating foreign aid.
ties and encourage them to Install VS.Some U.S. poUcy experts share those
concerns. Marshall Goldman, a Russia made equipment At the sametime,it
specialist and professor at WeDesley CM-
Helping Ourselves
U.S. Aid to Russia
Is Quite a Windfall—
For U.S. Consultants
h a v e
aid
u
s
r r M z e In U S
1
�component. Btcten o t (tnerous Rusilin presence in the polentlally huge Russian
f
lU&fruatftofcnMr
od
aid pactage found It easier to win votes forcanned f o martet
ka-U-oMSSMOi
N o e has gotten a bigger slice of the
o n
the plan by oonnnanc Confms that b
y
P G
being generous to the Russians. It would b program than K M Peat Marwick. To
e
help newly private firms manage the varihelping Amencin business, loa .
f
"One of the ways w get conptsslonal ous challenges o free enteronse. KPMG
e
support for the p o r m is that It does help
r ga
wired together J.P. Morgan It Co.. Bain A
American jobs and American businesses." Co.. Bechtel Corp.. Land 0' Lakes Inc. and
says Ambassador T o a W. Simons Jr., Young tt Rublcam's Bunon-Marsteller
hms
w o oversees AID'S Russia program for unit, a o g othera.
h
mn
the Stale Department H plays d w the Exactly what this all-star agglomerae
on
resentment and t e strength of antireform tion will d for Russia hasn't been fully
h
o
Communist and fasdst m v m ns In Rus- specified - and that shows another pecuoe e t
sia. "Everyone In M so these days Is liarity of the
oc w
trying to
alarmist." he says, adding that the Russia commit m nU.S. aid program. In a devicebought Into everything w said o a theoe
n
y quickly. AID uses
aid program Is delivering aid five times k o n as o e "Indefinite-quantity con- retical level, but there wu still a psychonw
an
faster than a normal one.
logical bamer." explains
tract." which leaves the details of a partic- BOG team leader. Martin Reeves,
the
ular project to b determined later by Mr. Then BOG. which AID Is paying S1.7
e
Layers of Advice
W a Is indisputable Is that the U.S. Boycko. on the Russian side, and AID million for this and other privatization
ht
consultants seem t c m In layers. World officials in Washington. IQCs. as they aremissions, discovered it had brought one of
o o e
Learning inc.. a Bratlleboro. Vt. firm that called, require an "omnibus contractor." athe problems with it Tbe worten sushas worked on AID'S Africa programs for firm like KPMG that can handle the heavy
pected tbe consultants were fixing u the
p
o e
2 years, was hired-with AID mooey-to accounting requirements that c m with business to buy it and b c m absentee
0
eo e
teach the art of writing AID grant propos- AID money. Uyen of subcontractors are bosses. So the B G t a put o o clothes
O em
o M
als to 2 0 U.S. volunteer groups eager to then folded in.
0
and led the Russians o a day-long deanup
o
oc w
provide help to the former Soviet Unkm. In KPMG's expanding M s o operation of a stinking warehouse. "Thai seemed to
addition, the firm w n a contract to vet is housed in tastefully refurbished officesdo it" explains Mr. Reeves. Nw fresh
o
o
proposals on building a "sodal safety net" In a former Communist Party office. Tbe
cabbages, even Uwifruitare showing u
p
for the newly unemployed. "People were firm figures that after the AID funds run the shelves tn Perm.
on
calling saying Where's the money? H w out It will have a strong dient base here.
o
can w get Into It?" recalls Margo Mlnnlnl. "This is a huge market" explains Peter Shot Out
e
the firm's senior p o r m officer.
r ga
Jovic. the partner in charge. The account- These bright spots don't offset the
disillusionment felt In Russia, w oe comhs
ing firm has trained more than 2 0 Rus0
Although Russian volunteer groups
wanted to partidpate. Worid Leaning
sians to do the b o s for banks and big panies are eligible to bid on VS AID
ok
contracts but are coralsten U shut out
y
picked only American concerns, with m c government-run companies.
uh
M s have little experience In grant writot
of the money going to big. n m entera e
ing
But Russians won't see m c of the AID and find themselves unabletocomply
uh
prises like the United Way. tbe U^. Red
oe
Cross and the YMCA. M s t o on Russian m n y that flows through the firm. Mr with arcane accounting regulations, or to
ot o k
Jovic adds. "Tbe AID m n y Is almost meet AID'S unprecedentedlytight304ay
oe
partners. But Russian groups lacking
h
American partners didn't m k the cut exdusively for consultants w oflyin anddeadline for filing grant applications.
ae
Nowhere is the disappointment m r
oe
Size and clout matter, even a o g the out"
mn
U.S. bidders. Take Citizens N t o k for
ew r
Still, the Russians have figured o t b w
u o acute than in the aid targeted for nuclear
disarmament - a field where Russians
Foreign Affairs, the agribusiness associa- t redirect s m a tosocial needs. Mr.
o
o e M
nm l yd
tion, which lists former Defense Secretary Jltnlkov. for example, sold donated VS. have oonsMerahle u e po e expertise.
There wu much exdtement in Russia
Frank Cariucb as chairman of its execu- equipment and f o for rubles that be used
od
tive committee. By letting tbe trade group to complete Russia's first germ-free ma- when Washington unveiled a SU billion
program to help dismantle Russia's aging
include some of Its largest m m e s in the ternity hospital In Saratov. 2 0 miles southe br
0
program. AID figured It could m k Its east of Moscow. "People in Russia k o nuclear anenal and reemploy its scienae
nw
tists in civilian research.
money g further. "We're leveraging over about this program." he says. "It Is not
o
S 0 million." explains one AID offldaL experts comingfromthe VStoinvesti- The Russians thought much of the
10
noting that the companies had already gate what is going on here. It Is real m n y wu coiningtothem, but It han't
oe
sunk that much in various Russian private support"
So far. tbe Pentagon, which runs the
ventures.
74
Supporten of the a package u de- program, hu contracted for S 5 mlffloo of
M
The trade group's pifiMnit. John H. signed contend that s m AID projects are goods and experts. Defense offldals
VS.
o e
OoeteOo. dedaieri recently that •The lor already producing tangible -results u wefl.uy it wu Congreu's suggestion to ue
mer Soviet Union does n t need foreign aidPrice Waterhouse. which snagged S 4 milo
3 Americans where "feasible"; they have,
the way we delivered It In the past They lion in contracts, set u a systemtosentaken the admonition a step further by
p
making tt a "guiding tenet"
want partners w o can w r with then ts a Russians shares in several thousand newly
h
ok
sustainable fashion to improve the food privatized companies. N w the Russians John H. Btrely, iwhitnt secretary of
o
system and create taoamk opportu- are pressing the firmtodesign a registry
defensefaratomic energy,recentlytoMa
nity.''
group of cheering defense contncton that
system and a Russian securities and exJohy Green
one of the program's goals wutoshow.
change commission.
W D these partnerships are designed And a 1 - a teamfromBoston Coo-Russians "the spirti offreeenterprise."
he
0m n
to create "pockets of efddeacjr a o g suiting Group spent three m nh strug- One proposal getting serious consider
mn
ots
ation: spending S 0 mllliootobuiM copies
6
emerging Russian companies, tbey also gling to help a privatized vegetable wholeuse taxpayer funds to bdp American busi-saler In Perm manage Its markets and of Russian railway tank can in a U.S.
nesses expand tn Russia. O e of the Inventories. Tbey found stores in tbe plant for export to Russia. Nearly
n
pockets getting tbe m n y belongs to Pots-gritty, industrial dty In the Urals starvedeveryone agrees that the cars, needed to
oe
bury's Green Giant unit w e already for vegetables, yet the wholesaler wu haul corrosiverocketfuel, could be built
Mh
bad invested tn a projed to grow, can and
floundering in rotting piles of beets much more cheaply tn Russia.
and
sell Its peas tn Russia. Under Its S m Un
3 U ocabbages. Bven after tbe consultants intro- Vadlm A. Slmonenko. a shy. smiling
h
AID grant POIsbury win teach a Russian duced sales commissions and other West-man w o beads the theoretical division at
Oietyablnsk-n, a fonnerty secret Russian •
cooperative h w to g o peastoGreen ern Incentives, not i^uch changed. "They
o
rw
base where nudear warheads are de- *
Giant specifications - while enlarging its
signed, seemsresigned." h t we have
Wa
learned Is that tbe Americans have a great
tendency to keep this m n y in tbetr o n
oe
w
country." be uys.
MS*
**
�THE WHITE HOUSE
Office of the Press Secretary
For Immediate Release
March 9, 1994
REMARKS BY THE PRESIDENT
IN ANNOUNCEMENT
O ADVANCE EARNED INCOME TAX CREDIT
N
FOR FEDERAL EMPLOYEES
The Oval Office
10:50 A.M. EST
THE PRESIDENT: Thank you very much, Mr. Vice President,
other members of the administration.
The earned income tax credit i s an important symbol of
the core commitment of t h i s administration to promote the values of
work and family and community, and to help people who work hard and
play by the rules. I t ' s been the driving force of everything we have
t r i e d to do since we took o f f i c e , from bringing the d e f i c i t down to
working to help create over two million jobs, health care reform to
welfare reform, a l l the other things we are doing.
This earned income tax credit can help to improve the
l i v e s of working people a l l across the country by l i f t i n g them above
the poverty l i n e . You a l l know that millions and millions of working
people now have had stagnant wages for v i r t u a l l y two decades; that
more and more people work hard and t h e i r wages don't keep up with
i n f l a t i o n . The principle behind what we are doing with the earned
income tax credit i s simple: I f you work for a l i v i n g you shouldn't
be i n poverty.
This year across our nation, 14 million Americans w i l l
claim the credit when they f i l e t h e i r 1993 tax returns. So we know
that w i l l help a l o t of people i n need. But we think there are some
more things we can do. The vast majority of the millions of
Americans who qualify receive t h e i r money i n a lump sum payment, l i k e
a refund, after they f i l e t h e i r taxes. But many of them, i f they
have a t l e a s t one child at home, could be receiving the benefit for
the current year right now in t h e i r regular paychecks. By simply
f i l l i n g out a form with only four yes or no questions, the W-5 form,
qualifying workers could be c o l l e c t i n g as much as 60 percent of t h i s
benefit due them i n t h i s way spread throughout the year. That means
extra money when they need i t to pay for groceries or clothing or
j u s t to make ends meet between paydays.
W want qualifying Americans to know about t h i s option.
e
In the coming weeks we'll be getting the word out to employers
everywhere, but today we're starting here in our own backyard. I n
the federal government, believe i t or not, hundreds of thousands of
workers are e l i g i b l e for the earned income tax credit. We want
e l i g i b l e government workers to be an example of how t h i s program can
be used.
So today I am sending a memorandum to a l l Cabinet
Secretaries and agency heads, instructing them to get that word out,
to get t h e i r personnel and payroll o f f i c e s on board so that
government employees know about the advance payment option for t h i s
earned income tax credit.
MORE
�- 2 -
I t ' s our responsibility
and who have earned i t . This i s not
That's an important distinction. I t
people who, day in and day out, have
take care of t h e i r families, to make
supporting taxpayers.
to help the people who need i t
a handout, i t i s a helping hand.
gives some breathing room to
done everything they could to
t h e i r own way, to be s e l f -
I've met with many families already who have benefitted
from t h i s credit and, for some, i t ' s helped with the most basic needs
— food, clothing, shelter. For others i t ' s helped to bridge the way
from being a semi-skilled job holder to a better l i f e with a better
training program and a better income. For s t i l l others, i t ' s j u s t an
incentive to keep going. This program works.
Let me say that t h i s year, because of our economic
program which passed, as you know, l a s t year, beginning in 1994, we
w i l l increase the number of people e l i g i b l e for the earned income tax
credit from 14 million people to almost 20 million people. And in
addition to that, the s i z e of the benefit w i l l begin going up rather
dramatically, phased in from this year to a l l future years.
But what t h i s means as a p r a c t i c a l — for the next four
or five years when i t goes up. What t h i s means as a p r a c t i c a l matter
i s , a person with a marginal income, working hard, e l i g i b l e for 60
percent of t h i s benefit every month might l i t e r a l l y get another $100
a month to help feed children, or clothe them, or meet basic family
expenses. I t i s a very important d i s t i n c t i o n . And I want to
emphasize that on the terms of getting the benefit every month, those
people w i l l qualify for the increased benefits and there w i l l be more
people qualifying t h i s year because that applies to 1994. So i t ' s
very, very important.
I'm going to sign t h i s executive order, and then ask
Secretary Bentsen and our IRS Commissioner, Peggy Richardson, to t a l k
about what they're going to do.
(The President signs the executive order.)
* * * * *
THE PRESIDENT: To give you — l e t me j u s t say one other
thing to kind of r e i t e r a t e t h i s . To give you some idea about the
numbers of people we're talking about i n America, starting t h i s year,
about 83 percent of the American people w i l l pay the same income tax
rates they've been paying, adjusted for i n f l a t i o n ; about 1.2 percent
w i l l pay a higher rate; and about 16.6 percent of total taxpayers in
the country are e l i g i b l e for a tax reduction. Those with children
are e l i g i b l e to get the monthly benefits as well as the lump-sum
payment at the end of the year. This i s b a s i c a l l y an income tax in
the form of a c r e d i t . So i t ' s a very s i g n i f i c a n t thing. One i n s i x
American taxpayers e l i g i b l e for t h i s benefit.
Q
Mr. President, can you t e l l us what
Q
—
Have you paid your taxes yet?
THE PRESIDENT: No, I haven't f i l l e d out my returns yet,
I don't think. I hadn't signed my return yet. I always —
You're not going to get an earned income?
(Laughter.)
THE PRESIDENT: I t ' s not time yet. They'll be f i l e d in
a timely fashion. And you'll see them, as you always do.
MORE
�- 3-
Q
Mr. President, can you t e l l us what you think of
Boris Y e l t s i n refusing to see Richard Nixon? Did you t e l l Richard
Nixon i t was okay with you i f he met with former Vice President
Rutskoy and the other opposition leaders?
THE PRESIDENT: I did, yes. He told me he wanted to do
that because, as a nongovernment o f f i c i a l , he f e l t that i t was an
appropriate thing for him to do, b a s i c a l l y going to Russia on a factfinding mission to l i s t e n to people who had views very different from
not only the Russian government, from h i s own, and from my own. And
he said he thought he was i n a different position from me, for
example; and I agreed that he was i n a different position. So he
said that's what he intended to do. And I told that was — I would
be interested in hearing h i s report when he got back.
Q
What do you make of Boris Y e l t s i n refusing to see
Richard Nixon as a result?
THE PRESIDENT: Well, of course, you have to — i t ' s up
to President Yeltsin whom he sees and doesn't see. I wish he would
see him because I think they'd enjoy talking to one another. And I
think Richard Nixon i s b a s i c a l l y quite sympathetic with the dilemmas
faced by Boris Y e l t s i n and generally quite supportive of h i s
administration. So I would hope that he w i l l see him, but I don't
think i t ' s — you know, i t ' s not the end of the world.
Q
Mr. President, how do you feel about the pull-out,
now, of a l l the troops from Somalia?
THE PRESIDENT: Well, f i r s t , I want to compliment our
m i l i t a r y people — they are doing an excellent job. They've handled
i t very well. And I think — as I have said a l l along, t h i s was
o r i g i n a l l y — i f you go back to 1992, t h i s whole mission was b i l l e d
as a humanitarian mission. And the f i r s t time President Bush spoke
with me about i t , he said he thought maybe they would be out before I
was inaugurated, or by the end of January. And what we learned from
that, of course, i s that a t l e a s t i n the case of Somalia and many
other cases, you can't have a humanitarian mission divorced from the
p o l i t i c a l problems of the time. The people i n Somalia were starving
not because there was no food that could be given to them, they were
starving because of the p o l i t i c a l and m i l i t a r y c o n f l i c t s consuming
the country.
The United States, and then the United Nations, went i n
there to give the people of Somalia a chance not only to save l i v e s ,
restore normalcy, end starvation, but to give them a chance to work
out t h e i r own problems i n a different way. And I think we have given
them that chance. The American people have been very generous with
t h e i r money and with t h e i r support. We have l o s t some of our most
precious resources, our young people, i n Somalia because of the
nature of the c o n f l i c t . And I think we have done our job there and
then some. And I feel very —
Q
But the c i v i l war w i l l resume there.
THE PRESIDENT: Well, we don't know that. I mean, they
s t i l l — that's up to them. There are c i v i l wars i n a l o t of
countries i n t h i s world that we have not made anything l i k e the
e f f o r t for we've made i n Somalia. There's a c i v i l war i n Sudan,
there's a c i v i l war i n Angola, there were l o t s of people k i l l e d i n
Burundi. That's j u s t i n Africa, never mind a l l these other places.
So we have made an extraordinary effort — the United
States has — to help the people of Somalia. And the leaders there
now have a choice to make. There are s t i l l United Nations forces
there. They're s t i l l i n a position to guarantee the a v a i l a b i l i t y of
food and medicine and a more humane l i f e . And they w i l l have to
decide whether they care more about that, and care more about t h e i r
people and seeing t h e i r children healthy, or whether they want to l e t
the country be consumed i n war again. But they have to take some
�- 4 -
r e s p o n s i b i l i t y now.
The responsibility i s shifting back to the
leaders there on the ground. And they ought to work i t out. They
ought to prefer the l i f e t h e i r people have had the l a s t 14 months or
so, 15 months, to what they had before. But i t ' s up to them.
Q
Mr. President, back on Russia, can you t e l l us
about your conversation with Mr. Yeltsin? He seemed to suggest that
you agreed with him on the Nixon v i s i t . Did you t a l k with him about
this?
THE PRESIDENT:
Q
With Mr.
Yeltsin?
Did you talk with him or with anyone?
THE PRESIDENT: I don't believe — I don't think Boris
Y e l t s i n and I discussed President Nixon's v i s i t . I don't believe we
did.
You know, I talked to him on a f a i r l y regular basis, but I
think the l a s t time we talked we were t a l k i n g about Bosnia, and I
don't think we had a conversation about i t .
But I did talk with Richard Nixon, President Nixon
before he went there. And he raised t h i s prospect of meeting with
some of the opposition leaders. He said he thought i t would be
interesting. He wanted to get a feel for where they were and what
kind of people they were. Again, he said he was not i n the
government of the United States, he was i n a different position. And
I said I had no — he should meet with whomever he wanted and I'd be
interested to hear h i s reports when he got back.
Q
But you don't think i t ' s a diplomatic i n s u l t for
Richard Nixon to have seen other leaders — opposition leaders?
THE PRESIDENT: No, because he's not in the government.
You know, he's not even — he's over there on a fact-finding mission
and I — as I said, Richard Nixon has been extremely supportive of
t h i s administration's Russia policy, which has been extremely
supportive of President Y e l t s i n and h i s objectives. So I think he's
been, i n that sense, as an American c i t i z e n and a longtime expert on
that area of the world, he's been very supportive of the objectives
of President Y e l t s i n , and I think i t should be seen i n that l i g h t .
Again, I can't speak to whatever the dynamics are in
Russian domestic p o l i t i c s at t h i s time and whether that i s having any
impact on President Yeltsin's decision. I can't speak to that. But
a l l I'm saying i s that I think that President Y e l t s i n should not
assume that Richard Nixon i s not friendly toward h i s administration
and toward democracy and toward reform, because, quite the contrary,
he has been a very strong supporter of our policy for the l a s t year.
And I wouldn't overreact to the fact that he met with some people who
are i n opposition to President Y e l t s i n .
Thank you.
Q
Mr. President, what advice do you have for top
aides who are appearing before — i n federal court about Whitewater
and —
THE PRESIDENT: Just the same advice I give everybody.
Just t e l l them what happened, answer the questions and go on.
Be
very open.
Q
Whitewater, s i r ?
Do you plan any other s t a f f changes as a r e s u l t of
END
11:10 A.M.
EST
�THE WHITE HOUSE
Office of the Press Secretary
For Immediate Release
February 25,
1994
PRESS CONFERENCE BY THE PRESIDENT
The Briefing Room
11:55 A.M.
EST
THE PRESIDENT: Good morning. I want to speak b r i e f l y
about events in the Middle East and in Russia.
Early t h i s morning, Palestinian Muslim worshipers at
prayer in the Mosque of Abraham in Hebron were b r u t a l l y gunned down
by a lone I s r a e l i s e t t l e r . I t can be no coincidence that the
murderer struck during the holy month of Ramadan and chose a s i t e
sacred to Muslims and to Jews. His l i k e l y purpose was to ruin the
h i s t o r i c r e c o n c i l i a t i o n now underway between the Palestinians and the
Israelis.
On behalf of the American people I condemn t h i s crime in
the strongest possible terms. I am outraged and saddened that such a
gross act of murder could be perpetrated. And I extend my deepest
sympathies to the families of those who have been k i l l e d and wounded.
I also c a l l on a l l the parties to exercise maximum
r e s t r a i n t i n what we a l l understand i s a t e r r i b l y emotional
situation. Extremists on both sides are determined to drag Arabs and
I s r a e l i s back into the darkness of unending c o n f l i c t and bloodshed.
We must prevent them from extinguishing the hopes and the visions and
the aspirations of ordinary people for a l i f e of peaceful existence.
The answer now i s to redouble our e f f o r t s to conclude
the t a l k s between I s r a e l and the PLO, and begin the implementation of
the agreement they have made as rapidly as possible.
Accordingly,
t h i s morning I asked the Secretary of State to contact Prime Minister
Rabin and Chairman Arafat and to invite them to send a l l t h e i r
negotiators involved in the Israel-PLO t a l k s to Washington as soon as
possible, and to stay here in continuous session u n t i l t h e i r work i s
completed. They have both agreed to do that.
Our purpose i s to accelerate the negotiations on the
Declaration of Principles and to t r y to bring them to a successful
conclusion in the shortest possible time. Those negotiations have
already made considerable progress as marked by the Cairo Agreement.
I t i s my hope that the parties can turn today's t r a g i c event into a
catalyst for further progress and r e c o n c i l i a t i o n .
I'd also l i k e to say a word about the Ames espionage
case, and our broader interests regarding Russia. Three days ago, an
employee of the CIA, Aldrich Ames, and h i s wife were arrested for
spying, f i r s t for the Soviet Union and then for Russia, over a period
dating back to the mid-1980s. I f the charges are true, the Ames
couple caused s i g n i f i c a n t damage to our national security and
betrayed t h e i r country.
This i s a serious case and we've made that c r y s t a l clear
to the Russian government. The CIA i s working to assess the damage
to our intelligence operation. The J u s t i c e Department i s vigorously
pursuing the court case. The FBI i s continuing to pursue i t s
investigations.
MORE
�- 2-
I t i s important that we not say anything at t h i s point
that could jeopardize the prosecution. We need to be firm as we
pursue both t h i s case and our national interest i n democratic reform
in Russia.
Support of the United States for reform i n Russia does
not flow from a sense of charity or blind f a i t h . Our policy i s based
on our clear American interests c l e a r l y pursued. I t i s i n our
national interest to continue working with Russia to lower the
nuclear threshold; to support the development of Russia as a peaceful
democracy, stable and at peace with i t s neighbors; to be a
constructive partner with the United States i n international
diplomacy; and to develope a flourishing market economy that can
benefit both t h e i r people and ours. I t i s , therefore, i n our
interest to make every effort to help the long-term struggle for
reform i n Russia succeed.
That's why I've worked with members of both parties i n
Congress to secure assistance for reform i n Russia, Ukraine, Armenia,
and other new states; why I went to Moscow i n January, to urge the
Russian people to stay the course of reform, to j o i n us i n building a
more positive partnership, and to advance the process of democracy
and market reform.
E a r l i e r today, I met with members of Congress from both
parties to discuss these issues; to stress the need for continuing
our long-term and bipartisan approach to dealing with Russia. And I
urged them to r e s i s t c a l l s to reduce or suspend our assistance for
reform i n Russia and the other new states of the Soviet Union —
former Soviet Union. After a l l , a great portion of our aid i s to
f a c i l i t a t e the dismantlement of nuclear weapons that were aimed at
the United States for over four decades. I t i s i n our interest,
plainly, to continue t h i s policy.
The majority of our economic assistance i s flowing not
to government but to reformers outside Moscow, mostly i n the
nongovernmental sector to help them s t a r t business and privatize
existing businesses, to help private farmers and to help support
exchange programs.
Throughout the Cold War, our nation acted with a
steadiness of purpose i n overcoming the challenge of Soviet
communism. Today, whether i t i s i n our p o l i c i e s toward Russia or
toward the Middle East, we need that same steadiness of purpose. Our
p o l i c i e s must be designed for the long-term and for the American
national i n t e r e s t s .
Q
Mr. President, Russia seems to be taking the view
that the spy case i s no big deal. Are you s a t i s f i e d with Russia's
response and cooperation to t h i s ? And i f they don't withdraw
individuals from t h e i r embassy here, w i l l you expel them?
THE PRESIDENT: Well, l e t me t r y to c l a r i f y , f i r s t of
a l l , what we have sought and why we have sought i t . We have not
sought Russian cooperation i n any damage assessment. That was
simply, I think, an erroneous report. We have sought Russian
cooperation, i f you w i l l , i n terms of taking what we believe i s
appropriate action i n t h i s case; and we think i t ' s appropriate action
be taken.
We have expressed our views i n what we hoped the
Russians would do. I f they do not do that, then we w i l l take action
and we w i l l take i t quickly, and then i t w i l l be apparent what we
have done.
Q
Mr. President, has there been any formal response?
Out of Moscow today they said they think they can have a dignified
MORE
�- 2-
I t i s important that we not say anything at t h i s point
that could jeopardize the prosecution. We need to be firm as we
pursue both t h i s case and our national interest i n democratic reform
in Russia.
Support of the United States for reform i n Russia does
not flow from a sense of charity or blind f a i t h . Our policy i s based
on our clear American interests c l e a r l y pursued. I t i s i n our
national interest to continue working with Russia to lower the
nuclear threshold; to support the development of Russia as a peaceful
democracy, stable and at peace with i t s neighbors; to be a
constructive partner with the United States i n international
diplomacy; and to develope a flourishing market economy that can
benefit both their people and ours. I t i s , therefore, i n our
interest to make every effort to help the long-term struggle for
reform i n Russia succeed.
That's why I've worked with members of both parties i n
Congress to secure assistance for reform i n Russia, Ukraine, Armenia,
and other new states; why I went to Moscow i n January, to urge the
Russian people to stay the course of reform, to j o i n us i n building a
more positive partnership, and to advance the process of democracy
and market reform.
E a r l i e r today, I met with members of Congress from both
parties to discuss these issues; to stress the need for continuing
our long-term and bipartisan approach to dealing with Russia. And I
urged them to r e s i s t c a l l s to reduce or suspend our assistance for
reform i n Russia and the other new states of the Soviet Union —
former Soviet Union. After a l l , a great portion of our aid i s to
f a c i l i t a t e the dismantlement of nuclear weapons that were aimed at
the United States for over four decades. I t i s i n our interest,
plainly, to continue t h i s policy.
The majority of our economic assistance i s flowing not
to government but to reformers outside Moscow, mostly i n the
nongovernmental sector to help them s t a r t business and p r i v a t i z e
existing businesses, to help private farmers and to help support
exchange programs.
Throughout the Cold War, our nation acted with a
steadiness of purpose i n overcoming the challenge of Soviet
communism. Today, whether i t i s i n our p o l i c i e s toward Russia or
toward the Middle East, we need that same steadiness of purpose. Our
p o l i c i e s must be designed for the long-term and for the American
national interests.
Q
Mr. President, Russia seems to be taking the view
that the spy case i s no big deal. Are you s a t i s f i e d with Russia's
response and cooperation to t h i s ? And i f they don't withdraw
individuals from t h e i r embassy here, w i l l you expel them?
THE PRESIDENT: Well, l e t me t r y to c l a r i f y , f i r s t of
a l l , what we have sought and why we have sought i t . We have not
sought Russian cooperation i n any damage assessment. That was
simply, I think, an erroneous report. We have sought Russian
cooperation, i f you w i l l , i n terms of taking what we believe i s
appropriate action i n t h i s case; and we think i t ' s appropriate action
be taken.
We have expressed our views i n what we hoped the
Russians would do. I f they do not do that, then we w i l l take action
and we w i l l take i t quickly, and then i t w i l l be apparent what we
have done.
Q
Mr. President, has there been any formal response?
Out of Moscow today they said they think they can have a dignified
MORE
�THE WHITE HOUSE
Office of the Press Secretary
For Immediate Release
February 25,
1994
PRESS CONFERENCE BY THE PRESIDENT
The Briefing Room
11:55 A.M.
EST
THE PRESIDENT: Good morning. I want to speak b r i e f l y
about events i n the Middle East and in Russia.
Early t h i s morning, Palestinian Muslim worshipers at
prayer i n the Mosque of Abraham in Hebron were brutally gunned down
by a lone I s r a e l i s e t t l e r . I t can be no coincidence that the
murderer struck during the holy month of Ramadan and chose a s i t e
sacred to Muslims and to Jews. His l i k e l y purpose was to ruin the
h i s t o r i c r e c o n c i l i a t i o n now underway between the Palestinians and the
Israelis.
On behalf of the American people I condemn t h i s crime in
the strongest possible terms. I am outraged and saddened that such a
gross act of murder could be perpetrated. And I extend my deepest
sympathies to the families of those who have been k i l l e d and wounded.
I also c a l l on a l l the parties to exercise maximum
r e s t r a i n t in what we a l l understand i s a t e r r i b l y emotional
situation. Extremists on both sides are determined to drag Arabs and
I s r a e l i s back into the darkness of unending c o n f l i c t and bloodshed.
We must prevent them from extinguishing the hopes and the visions and
the aspirations of ordinary people for a l i f e of peaceful existence.
The answer now i s to redouble our e f f o r t s to conclude
the t a l k s between I s r a e l and the PLO, and begin the implementation of
the agreement they have made as rapidly as possible.
Accordingly,
t h i s morning I asked the Secretary of state to contact Prime Minister
Rabin and Chairman Arafat and to invite them to send a l l t h e i r
negotiators involved i n the Israel-PLO t a l k s to Washington as soon as
possible, and to stay here in continuous session u n t i l t h e i r work i s
completed. They have both agreed to do that.
Our purpose i s to accelerate the negotiations on the
Declaration of Principles and to t r y to bring them to a successful
conclusion in the shortest possible time. Those negotiations have
already made considerable progress as marked by the Cairo Agreement.
I t i s my hope that the parties can turn today's t r a g i c event into a
c a t a l y s t for further progress and r e c o n c i l i a t i o n .
I'd also l i k e to say a word about the Ames espionage
case, and our broader interests regarding Russia. Three days ago, an
employee of the CIA, Aldrich Ames, and h i s wife were arrested for
spying, f i r s t for the Soviet Union and then for Russia, over a period
dating back to the mid-1980s. I f the charges are true, the Ames
couple caused s i g n i f i c a n t damage to our national security and
betrayed t h e i r country.
This i s a serious case and we've made that c r y s t a l clear
to the Russian government. The CIA i s working to assess the damage
to our intelligence operation. The J u s t i c e Department i s vigorously
pursuing the court case. The FBI i s continuing to pursue i t s
investigations.
MORE
�- 3-
resolution. Has anything been offered? And, also, are you looking
for a second possible double agent i n the CIA?
THE PRESIDENT: We are — we have made our position
clear. We have been i n contact with the Russians. We think
appropriate action w i l l be taken one way or the other very soon.
Q
Mr. President, you referred to the perpetrator of
the massacre today as a lone s e t t l e r , and the evidence so far
suggests that he did act alone. But there have been repeated reports
over the years of Americans providing aid, both fundraising and other
sorts of aid to extremist groups on both sides. And I wonder
whether, i n l i g h t of today's massacre, whether there i s more that
needs to be done here to t r y to prevent Americans from providing aid
and other forms of support to Jewish extremist groups that may be
involved i n these sorts of actions.
THE PRESIDENT: Well, l e t me say, based on what we now
know, we have no reason to believe that t h i s k i l l e r was involved with
any group. I f we find out differently, we w i l l assess our position
at that time.
I can say t h i s : that Prime Minister Rabin, himself, has
recognized the need to strengthen the security provided by I s r a e l i
forces against extremists, including I s r a e l i extremists. But as far
as we know, t h i s was the action of one individual.
Q
Mr. President, what i s i t about t h i s massacre as
opposed to other setbacks that have occurred i n the Middle East that
has brought you to t h i s podium today, that makes you feel i t ' s
necessary to make a strong statement?
THE PRESIDENT: F i r s t of a l l , i t s scope and setting i s
horrible from a purely human point of view. Secondly, i t comes at a
time when i t appears to be c l e a r l y designed to affect the l i v e s of
hundreds of thousands of others by derailing the peace process. And
I am hoping that the statesmanship of the leaders i n the region and
the attention that t h i s w i l l bring to the t e r r i b l e problem w i l l not
only diffuse what could become a much worse round of k i l l i n g s and
counterattacks, but w i l l actually be used to thwart the purpose of
the murder and to reinvigorate the peace process.
Q
Mr. President, j u s t to follow up on the e a r l i e r
question. There have been reports from the scene that the I s r a e l i
army stood by and allowed t h i s massacre to go on. What kind of
recommendation would you make to I s r a e l to t r y to do an investigation
to see what happened and change the perception maybe of that?
THE PRESIDENT: Well, we have no reason — we do not
know that to be true. I can say that at t h i s time. And we have —
the Secretary of State has talked with Prime Minister Rabin. I was
not able to t a l k with him myself yet because of the other meetings I
had t h i s morning. I believe the I s r a e l i s are committed to increasing
security where they can do so. And I don't want to comment on that
without some evidence or reason to believe i t s true.
Q
Mr. President, there's a G-7 meeting on Saturday in
Frankfort. I t ' s supposed to focus on Russian aid. Do we go to that
meeting with any particular proposition on the speed of aid, or the
conditionality of aid to Russia? And also, at that meeting, Bentsen
w i l l be meeting with Japanese Finance Minister F u j i i regarding the
f a i l e d trade talks, framework t a l k s . Do you see the Gephardt and
Rockefeller open markets s t i l l being helpful to your mission to open
markets i n Japan? Do you support that?
THE PRESIDENT: Well, we've taken no position on any
particular l e g i s l a t i o n . I think that i t shows the determination of
the American people to improve our trade and open the markets;
MORE
�- 4 -
especially the involvement of Senator Rockefeller, who's actually
lived in Japan and I think i s thought of genuinely as a friend of
Japan, but someone who understands what i s at stake here.
With regard to the other question, I think we're where
we always have been. The kind of aid and the amount of aid which
w i l l flow to Russia, and the sources from which i t flows I think w i l l
be a function of the p o l i c i e s and conduct of the Russians.
Q
Are you concerned now, s i r , apart from the Ames
case, about other developments in Russia that might make your policy
there appear almost to be in denial, based on what you and others
wish were happening or hope w i l l happen, rather than what r e a l l y i s
happening there?
THE PRESIDENT: No, I mean, t h i s has — my policy has
nothing to do with what I wish or hope w i l l happen. Our response
w i l l be dictated by t h e i r behavior. But I think the — what I think
i s naive in t h i s whole element i s the suggestion that we should have
ever believed for a moment that every event in Russia and every
speech made by every Russian p o l i t i c i a n in every election of every
member of Parliament would somehow be in a constant straight line
toward a goal that we wanted to predetermine. They have to make
t h e i r own future. That's what I said there over and over again.
This i s not black and white; t h i s i s grey. There w i l l
be developments over the course of our relationship with Russia which
— as there are over the course of our relationship with every other
country — where we won't l i k e everything that happens. We should do
things based on a clear-headed appreciation of what i s in our
national i n t e r e s t .
No one has made a compelling case to me, publicly or
privately, that i t i s not in our national interests to continue to
work with the President of Russia and the government of Russia on
denuclearization, on cooperation and respect for neighbors and on
economic reform where we can support i t . That i s , the privatization
movement, for example, I would j u s t remind you, i s s t i l l going on in
Russia and has b a s i c a l l y occurred more rapidly there than in other
former Soviet countries.
So I don't believe the fact that a few speeches are made
that we don't agree with, or that p o l i c i e s are pursued based on an
election they had for a Parliament that we don't agree with should
force us to abandon what i s in our national i n t e r e s t . When i t i s no
longer in our national interest to do these things, then we should
stop i t . But we cannot be allowed — deluded into thinking that our
national interest can be defined by every election and every speech
in Russia; that can't be.
Q
Mr. President, in i n v i t i n g the parties to come here
to Washington, do you also anticipate that you or the Secretary of
State w i l l adopt a different posture toward these negotiations? Up
to now, we've kind of l e t them handle i t and keep a hands-off
approach — wisely. But do you see, in fact, now that they're going
to be here and given the urgency you've assigned to i t , do you see
yourself or the Secretary taking a different posture toward the
talks?
THE PRESIDENT: I think, f i r s t of a l l , the very act of
i n v i t i n g them here indicates some sense of urgency on our part. What
we have done to date, as you know, i s largely to t r y to give both
sides the security they needed to proceed, and the assurances that we
would support i t , but that they would have to freely make the
agreement. We s t i l l believe they w i l l have to freely agree.
We believe they are close to agreement. We want to do
things that w i l l prevent t h i s l a s t t e r r i b l e incident from derailing
MORE
�- 4 -
especially the involvement of Senator Rockefeller, who's actually
lived in Japan and I think i s thought of genuinely as a friend of
Japan, but someone who understands what i s at stake here.
With regard to the other question, I think we're where
we always have been. The kind of aid and the amount of aid which
w i l l flow to Russia, and the sources from which i t flows I think w i l l
be a function of the p o l i c i e s and conduct of the Russians.
Q
Are you concerned now, s i r , apart from the Ames
case, about other developments in Russia that might make your policy
there appear almost to be in denial, based on what you and others
wish were happening or hope w i l l happen, rather than what r e a l l y i s
happening there?
THE PRESIDENT: No, I mean, t h i s has — my policy has
nothing to do with what I wish or hope w i l l happen. Our response
w i l l be dictated by t h e i r behavior. But I think the — what I think
i s naive in t h i s whole element i s the suggestion that we should have
ever believed for a moment that every event in Russia and every
speech made by every Russian p o l i t i c i a n in every election of every
member of Parliament would somehow be in a constant straight line
toward a goal that we wanted to predetermine. They have to make
t h e i r own future. That's what I said there over and over again.
This i s not black and white; t h i s i s grey. There w i l l
be developments over the course of our relationship with Russia which
— as there are over the course of our relationship with every other
country — where we won't l i k e everything that happens. We should do
things based on a clear-headed appreciation of what i s in our
national interest.
No one has made a compelling case to me, publicly or
privately, that i t i s not in our national interests to continue to
work with the President of Russia and the government of Russia on
denuclearization, on cooperation and respect for neighbors and on
economic reform where we can support i t . That i s , the privatization
movement, for example, I would j u s t remind you, i s s t i l l going on in
Russia and has b a s i c a l l y occurred more rapidly there than in other
former Soviet countries.
So I don't believe the fact that a few speeches are made
that we don't agree with, or that p o l i c i e s are pursued based on an
election they had for a Parliament that we don't agree with should
force us to abandon what i s in our national i n t e r e s t . When i t i s no
longer in our national interest to do these things, then we should
stop i t . But we cannot be allowed — deluded into thinking that our
national interest can be defined by every election and every speech
in Russia; that can't be.
Q
Mr. President, in i n v i t i n g the parties to come here
to Washington, do you also anticipate that you or the Secretary of
State w i l l adopt a different posture toward these negotiations? Up
to now, we've kind of l e t them handle i t and keep a hands-off
approach — wisely. But do you see, in fact, now that they're going
to be here and given the urgency you've assigned to i t , do you see
yourself or the Secretary taking a different posture toward the
talks?
THE PRESIDENT: I think, f i r s t of a l l , the very act of
inviting them here indicates some sense of urgency on our part. What
we have done to date, as you know, i s largely to t r y to give both
sides the security they needed to proceed, and the assurances that we
would support i t , but that they would have to freely make the
agreement. We s t i l l believe they w i l l have to freely agree.
We believe they are close to agreement. We want to do
things that w i l l prevent t h i s l a s t t e r r i b l e incident from derailing
MORE
�- 3-
resolution. Has anything been offered? And, also, are you looking
for a second possible double agent i n the CIA?
THE PRESIDENT: We are — we have made our position
clear. We have been i n contact with the Russians. We think
appropriate action w i l l be taken one way or the other very soon.
Q
Mr. President, you referred to the perpetrator of
the massacre today as a lone s e t t l e r , and the evidence so far
suggests that he did act alone. But there have been repeated reports
over the years of Americans providing aid, both fundraising and other
sorts of aid to extremist groups on both sides. And I wonder
whether, i n l i g h t of today's massacre, whether there i s more that .
needs to be done here to t r y to prevent Americans from providing aid
and other forms of support to Jewish extremist groups that may be
involved i n these sorts of actions.
THE PRESIDENT: Well, l e t me say, based on what we now
know, we have no reason to believe that t h i s k i l l e r was involved with
any group. I f we find out differently, we w i l l assess our position
at that time.
I can say t h i s : that Prime Minister Rabin, himself, has
recognized the need to strengthen the security provided by I s r a e l i
forces against extremists, including I s r a e l i extremists. But as far
as we know, t h i s was the action of one individual.
Q
Mr. President, what i s i t about t h i s massacre as
opposed to other setbacks that have occurred i n the Middle East that
has brought you to t h i s podium today, that makes you feel i t ' s
necessary to make a strong statement?
THE PRESIDENT: F i r s t of a l l , i t s scope and setting i s
horrible from a purely human point of view. Secondly, i t comes at a
time when i t appears to be c l e a r l y designed to affect the l i v e s of
hundreds of thousands of others by derailing the peace process. And
I am hoping that the statesmanship of the leaders i n the region and
the attention that t h i s w i l l bring to the t e r r i b l e problem w i l l not
only diffuse what could become a much worse round of k i l l i n g s and
counterattacks, but w i l l actually be used to thwart the purpose of
the murder and to reinvigorate the peace process.
Q
Mr. President, j u s t to follow up on the e a r l i e r
question. There have been reports from the scene that the I s r a e l i
army stood by and allowed t h i s massacre to go on. What kind of
recommendation would you make to I s r a e l to t r y to do an investigation
to see what happened and change the perception maybe of that?
THE PRESIDENT: Well, we have no reason — we do not
know that to be true. I can say that at t h i s time. And we have —
the Secretary of State has talked with Prime Minister Rabin. I was
not able to t a l k with him myself yet because of the other meetings I
had t h i s morning. I believe the I s r a e l i s are committed to increasing
security where they can do so. And I don't want to comment on that
without some evidence or reason to believe i t s true.
Q
Mr. President, there's a G-7 meeting on Saturday in
Frankfort. I t ' s supposed to focus on Russian aid. Do we go to that
meeting with any particular proposition on the speed of aid, or the
conditionality of aid to Russia? And also, at that meeting, Bentsen
w i l l be meeting with Japanese Finance Minister F u j i i regarding the
f a i l e d trade t a l k s , framework t a l k s . Do you see the Gephardt and
Rockefeller open markets s t i l l being helpful to your mission to open
markets i n Japan? Do you support that?
THE PRESIDENT: Well, we've taken no position on any
particular l e g i s l a t i o n . I think that i t shows the determination of
the American people to improve our trade and open the markets;
MORE
�- 5 -
that, and to t r y to send a signal to the peoples in the region to not
overreact to t h i s horrible act, that the path of peace i s s t i l l the
right path. Whether that w i l l require us to do more in particular
meetings, I can't say, because we have discussed t h i s with Chairman
Arafat, with Prime Minister Rabin because we wanted to move quickly
and they did, too, and we'll j u s t have to wait for that to unfold.
Q
Mr. President, Senator Nunn has j u s t said that we
should not be asking Russia to voluntarily bring back t h e i r
diplomats, but we should have simply expelled them the way we would
have during the Cold War and after the Cold War; that t h i s i s too
serious a case. Why didn't we j u s t expel the diplomats s t i l l working
here?
THE PRESIDENT: I think that the judgment of the
security services was — and the national security team — was that
the Russians ought to be at least told what we know — not negotiated
with, there was no negotiation — told what we know and given an
opportunity to take whatever action they wanted to take. And i f they
don't, then we w i l l do what we should do. And we w i l l take
appropriate action. We w i l l do that soon.
Q
Mr. President, does that also mean, as Senator
Leahy and Senator Mitchell and others are suggesting following your
meeting t h i s morning, that you, the United States government, w i l l
also expose Russian diplomats who are, in effect, who are r e a l l y
intelligence o f f i c e r s who are not declared to the U. S. government as
intelligence officers? Will you take that step and, i f you do, don't
you invite r e t a l i a t i o n , counterexpulsions, counterdeclarations,
exposures on the part of the Russian government against U.S.
o f f i c i a l s in Moscow?
THE PRESIDENT: We intend to take the action that we
think i s appropriate and you won't have to wait long to find out what
that i s .
Q
Mr. President, are you in any way interfering with
the j u d i c i a l process in appearing with Congressman Rostenkowski in
I l l i n o i s on Monday? There have been suggestions
THE PRESIDENT:
Absolutely not.
Q
— that Attorney General Reno had concerns that you
would be appearing with someone under investigation?
THE PRESIDENT: F i r s t of a l l — l e t me make a couple of
comments about that. F i r s t of a l l , I have had no conversations to
that effect with anyone in the Justice Department. Secondly, there
i s no way in the world we would do anything l i k e that. Thirdly, t h i s
investigation has been going on for months. I have been in Chicago
before with Congressman Rostenkowski.
I am going there and w i l l be
with other members of Congress, at least one other I know and perhaps
more, to t a l k about issues that d i r e c t l y relate to t h i s
administration's work that he i s a c r i t i c a l part of: health care and
crime. And f i n a l l y , there i s s t i l l a presumption of innocence in
t h i s country. He has not yet been charged with anything.
But I can t e l l you, there has been absolutely no contact
of any nature about t h i s case with the J u s t i c e Department and the
White House that anyone could draw any inference of impropriety on.
And I have received nothing back the other way that I shouldn't go to
Chicago. I am going there to fight for things I believe i n that he
has played a c r i t i c a l role i n . I am going to be with at l e a s t one
other, perhaps more members of Congress — I don't know yet — and
I'm going to be doing something that I have already done while t h i s
investigation has been going on. No one ever said anything about i t
before.
MORE
�- 6-
Q
You said that the Ames case had caused s i g n i f i c a n t
damage to the national security. Can you be more s p e c i f i c , s i r ? And
secondly, you've said the FBI investigation i s ongoing. Are you
s a t i s f i e d that we know the f u l l extent of the penetration of the CIA
at t h i s point?
THE PRESIDENT: Well, I can say very l i t t l e about that
except to assure you — I talked with Director Freeh t h i s morning
myself — I am confident that the FBI, working with the CIA, i s doing
everything that i s humanly possible to f u l l y investigate t h i s case.
I do not want to r a i s e red herrings or other p o s s i b i l i t i e s , only to
say t h i s : that i t i s not unusual, as the FBI Director said t h i s
morning. Sometimes i t happens that when you're i n a criminal
investigation and you're on to something, the investigation turns up
information that could not have been anticipated i n the beginning. I
am not trying to say that has occurred. I'm not trying to r a i s e any
false hopes. A l l I'm t e l l i n g you i s , I have directed the FBI and the
CIA and everybody else to do everything they can to get to the f u l l
bottom of t h i s . And I have nothing else to say about i t .
And, again, I'm not trying to r a i s e some t a n t a l i z i n g
inference, I'm j u s t saying that we have to keep going and t r y to root
i t out. After a l l , t h i s i s fundamentally a problem within America,
about whether people here who are Americans are spying, and that's
our r e s p o n s i b i l i t y to t r y to find i t out.
Thank you.
THE PRESS:
Thank you.
END
12:16 P.M. EST
�- 6-
Q
You said that the Ames case had caused s i g n i f i c a n t
damage to the national security. Can you be more s p e c i f i c , s i r ? And
secondly, you've said the FBI investigation i s ongoing. Are you
s a t i s f i e d that we know the f u l l extent of the penetration of the CIA
at t h i s point?
THE PRESIDENT: Well, I can say very l i t t l e about that
except to assure you — I talked with Director Freeh t h i s morning
myself — I am confident that the FBI, working with the CIA, i s doing
everything that i s humanly possible to f u l l y investigate t h i s case.
I do not want to r a i s e red herrings or other p o s s i b i l i t i e s , only to
say t h i s : that i t i s not unusual, as the FBI Director said t h i s
morning. Sometimes i t happens that when you're i n a criminal
investigation and you're on to something, the investigation turns up
information that could not have been anticipated i n the beginning. I
am not trying to say that has occurred. I'm not trying to r a i s e any
false hopes. A l l I'm t e l l i n g you i s , I have directed the FBI and the
CIA and everybody else to do everything they can to get to the f u l l
bottom of t h i s . And I have nothing else to say about i t .
And, again, I'm not trying to r a i s e some t a n t a l i z i n g
inference, I'm j u s t saying that we have to keep going and t r y to root
i t out. After a l l , t h i s i s fundamentally a problem within America,
about whether people here who are Americans are spying, and that's
our r e s p o n s i b i l i t y to t r y to find i t out.
Thank you.
THE PRESS:
Thank you.
END
12:16 P.M. EST
�- 5 -
that, and to t r y to send a signal to the peoples in the region to not
overreact to t h i s horrible act, that the path of peace i s s t i l l the
right path. Whether that w i l l require us to do more in particular
meetings, I can't say, because we have discussed t h i s with Chairman
Arafat, with Prime Minister Rabin because we wanted to move quickly
and they did, too, and we'll j u s t have to wait for that to unfold.
Q
Mr. President, Senator Nunn has j u s t said that we
should not be asking Russia to voluntarily bring back t h e i r
diplomats, but we should have simply expelled them the way we would
have during the Cold War and after the Cold War; that t h i s i s too
serious a case. Why didn't we j u s t expel the diplomats s t i l l working
here?
THE PRESIDENT: I think that the judgment of the
security services was — and the national security team — was that
the Russians ought to be at least told what we know — not negotiated
with, there was no negotiation — told what we know and given an
opportunity to take whatever action they wanted to take. And i f they
don't, then we w i l l do what we should do. And we w i l l take
appropriate action. We w i l l do that soon.
Q
Mr. President, does that also mean, as Senator
Leahy and Senator Mitchell and others are suggesting following your
meeting t h i s morning, that you, the United States government, w i l l
also expose Russian diplomats who are, in effect, who are r e a l l y
intelligence o f f i c e r s who are not declared to the U. S. government as
intelligence o f f i c e r s ? Will you take that step and, i f you do, don't
you i n v i t e r e t a l i a t i o n , counterexpulsions, counterdeclarations,
exposures on the part of the Russian government against U.S.
o f f i c i a l s in Moscow?
THE PRESIDENT: We intend to take the action that we
think i s appropriate and you won't have to wait long to find out what
that i s .
Q
Mr. President, are you in any way interfering with
the j u d i c i a l process in appearing with Congressman Rostenkowski in
I l l i n o i s on Monday? There have been suggestions
THE PRESIDENT:
Absolutely not.
Q
— that Attorney General Reno had concerns that you
would be appearing with someone under investigation?
THE PRESIDENT: F i r s t of a l l — l e t me make a couple of
comments about that. F i r s t of a l l , I have had no conversations to
that effect with anyone in the Justice Department. Secondly, there
i s no way in the world we would do anything l i k e that. Thirdly, this
investigation has been going on for months. I have been in Chicago
before with Congressman Rostenkowski.
I am going there and w i l l be
with other members of Congress, at least one other I know and perhaps
more, to t a l k about issues that d i r e c t l y relate to t h i s
administration's work that he i s a c r i t i c a l part of: health care and
crime. And f i n a l l y , there i s s t i l l a presumption of innocence in
t h i s country. He has not yet been charged with anything.
But I can t e l l you, there has been absolutely no contact
of any nature about t h i s case with the Justice Department and the
White House that anyone could draw any inference of impropriety on.
And I have received nothing back the other way that I shouldn't go to
Chicago. I am going there to fight for things I believe in that he
has played a c r i t i c a l role i n . I am going to be with at least one
other, perhaps more members of Congress — I don't know yet — and
I'm going to be doing something that I have already done while t h i s
investigation has been going on. No one ever said anything about i t
before.
MORE
�THE WHITE HOUSE
Office of the Press Secretary
For Immediate Release
February 25,
1994
PRESS CONFERENCE BY THE PRESIDENT
The Briefing Room
11:55
A.M.
EST
THE PRESIDENT: Good morning. I want to speak b r i e f l y
about events i n the Middle East and in Russia.
Early t h i s morning, Palestinian Muslim worshipers at
prayer in the Mosque of Abraham in Hebron were b r u t a l l y gunned down
by a lone I s r a e l i s e t t l e r . I t can be no coincidence that the
murderer struck during the holy month of Ramadan and chose a s i t e
sacred to Muslims and to Jews. His l i k e l y purpose was to ruin the
h i s t o r i c r e c o n c i l i a t i o n now underway between the Palestinians and the
Israelis.
On behalf of the American people I condemn t h i s crime in
the strongest possible terms. I am outraged and saddened that such a
gross act of murder could be perpetrated. And I extend my deepest
sympathies to the families of those who have been k i l l e d and wounded.
I also c a l l on a l l the parties to exercise maximum
r e s t r a i n t i n what we a l l understand i s a t e r r i b l y emotional
s i t u a t i o n . Extremists on both sides are determined to drag Arabs and
I s r a e l i s back into the darkness of unending c o n f l i c t and bloodshed.
We must prevent them from extinguishing the hopes and the visions and
the aspirations of ordinary people for a l i f e of peaceful existence.
The answer now i s to redouble our e f f o r t s to conclude
the t a l k s between I s r a e l and the PLO, and begin the implementation of
the agreement they have made as rapidly as possible.
Accordingly,
t h i s morning I asked the Secretary of State to contact Prime Minister
Rabin and Chairman Arafat and to invite them to send a l l t h e i r
negotiators involved i n the Israel-PLO t a l k s to Washington as soon as
possible, and to stay here in continuous session u n t i l their work i s
completed. They have both agreed to do that.
Our purpose i s to accelerate the negotiations on the
Declaration of P r i n c i p l e s and to try to bring them to a successful
conclusion in the shortest possible time. Those negotiations have
already made considerable progress as marked by the Cairo Agreement.
I t i s my hope that the parties can turn today's t r a g i c event into a
c a t a l y s t for further progress and r e c o n c i l i a t i o n .
I'd also l i k e to say a word about the Ames espionage
case, and our broader interests regarding Russia. Three days ago, an
employee of the CIA, Aldrich Ames, and h i s wife were arrested for
spying, f i r s t for the Soviet Union and then for Russia, over a period
dating back to the mid-1980s. I f the charges are true, the Ames
couple caused s i g n i f i c a n t damage to our national security and
betrayed t h e i r country.
This i s a serious case and we've made that c r y s t a l clear
to the Russian government. The CIA i s working to assess the damage
to our i n t e l l i g e n c e operation. The J u s t i c e Department i s vigorously
pursuing the court case. The FBI i s continuing to pursue i t s
investigations.
MORE
�- 2-
I t i s important that we not say anything at t h i s point
that could jeopardize the prosecution. We need to be firm as we
pursue both t h i s case and our national interest i n democratic reform
in Russia.
Support of the United States for reform i n Russia does
not flow from a sense of charity or blind f a i t h . Our policy i s based
on our c l e a r American interests c l e a r l y pursued. I t i s i n our
national interest to continue working with Russia to lower the
nuclear threshold; to support the development of Russia as a peaceful
democracy, stable and at peace with i t s neighbors; to be a
constructive partner with the United States i n international
diplomacy; and to develope a flourishing market economy that can
benefit both t h e i r people and ours. I t i s , therefore, i n our
i n t e r e s t to make every effort to help the long-term struggle for
reform i n Russia succeed.
That's why I've worked with members of both parties i n
Congress to secure assistance for reform i n Russia, Ukraine, Armenia,
and other new states; why I went to Moscow i n January, to urge the
Russian people to stay the course of reform, to j o i n us i n building a
more p o s i t i v e partnership, and to advance the process of democracy
and market reform.
E a r l i e r today, I met with members of Congress from both
p a r t i e s to discuss these issues; to stress the need for continuing
our long-term and bipartisan approach to dealing with Russia. And I
urged them to r e s i s t c a l l s to reduce or suspend our assistance for
reform i n Russia and the other new states of the Soviet Union —
former Soviet Union. After a l l , a great portion of our aid i s to
f a c i l i t a t e the dismantlement of nuclear weapons that were aimed at
the United States for over four decades. I t i s i n our interest,
p l a i n l y , to continue t h i s policy.
The majority of our economic assistance i s flowing not
to government but to reformers outside Moscow, mostly i n the
nongovernmental sector to help them s t a r t business and privatize
e x i s t i n g businesses, to help private farmers and to help support
exchange programs.
Throughout the Cold War, our nation acted with a
steadiness of purpose i n overcoming the challenge of Soviet
communism. Today, whether i t i s i n our p o l i c i e s toward Russia or
toward the Middle East, we need that same steadiness of purpose. Our
p o l i c i e s must be designed for the long-term and for the American
national i n t e r e s t s .
Q
Mr. President, Russia seems to be taking the view
that the spy case i s no big deal. Are you s a t i s f i e d with Russia's
response and cooperation to t h i s ? And i f they don't withdraw
individuals from their embassy here, w i l l you expel them?
THE PRESIDENT: Well, l e t me t r y to c l a r i f y , f i r s t of
a l l , what we have sought and why we have sought i t . We have not
sought Russian cooperation i n any damage assessment. That was
simply, I think, an erroneous report. We have sought Russian
cooperation, i f you w i l l , i n terms of taking what we believe i s
appropriate action in t h i s case; and we think i t ' s appropriate action
be taken.
We have expressed our views i n what we hoped the
Russians would do. I f they do not do that, then we w i l l take action
"and we w i l l take i t quickly, and then i t w i l l be apparent what we
have done.
Q
Mr. President, has there been any formal response?
Out of Moscow today they said they think they can have a dignified
MORE
�- 3-
resolution. Has anything been offered? And, also, are you looking
for a second possible double agent i n the CIA?
THE PRESIDENT: We are — we have made our position
c l e a r . We have been i n contact with the Russians. We think
appropriate action w i l l be taken one way or the other very soon.
Q
Mr. President, you referred to the perpetrator of
the massacre today as a lone s e t t l e r , and the evidence so far
suggests that he did act alone. But there have been repeated reports
over the years of Americans providing aid, both fundraising and other
sorts of aid to extremist groups on both sides. And I wonder
whether, i n l i g h t of today's massacre, whether there i s more that .
needs to be done here to t r y to prevent Americans from providing aid
and other forms of support to Jewish extremist groups that may be
involved i n these sorts of actions.
THE PRESIDENT: Well, l e t me say, based on what we now
know, we have no reason to believe that t h i s k i l l e r was involved with
any group. I f we find out differently, we w i l l assess our position
at that time.
I can say t h i s : that Prime Minister Rabin, himself, has
recognized the need to strengthen the security provided by I s r a e l i
forces against extremists, including I s r a e l i extremists. But as far
as we know, t h i s was the action of one individual.
Q
Mr. President, what i s i t about t h i s massacre as
opposed to other setbacks that have occurred i n the Middle East that
has brought you to t h i s podium today, that makes you feel i t ' s
necessary to make a strong statement?
THE PRESIDENT: F i r s t of a l l , i t s scope and setting i s
horrible from a purely human point of view. Secondly, i t comes at a
time when i t appears to be c l e a r l y designed to affect the l i v e s of
hundreds of thousands of others by derailing the peace process. And
I am hoping that the statesmanship of the leaders i n the region and
the attention that t h i s w i l l bring to the t e r r i b l e problem w i l l not
only diffuse what could become a much worse round of k i l l i n g s and
counterattacks, but w i l l actually be used to thwart the purpose of
the murder and to reinvigorate the peace process.
Q
Mr. President, j u s t to follow up on the e a r l i e r
question. There have been reports from the scene that the I s r a e l i
army stood by and allowed t h i s massacre to go on. What kind of
recommendation would you make to I s r a e l to t r y to do an investigation
to see what happened and change the perception maybe of that?
THE PRESIDENT: Well, we have no reason — we do not
know that to be true. I can say that at t h i s time. And we have —
the Secretary of State has talked with Prime Minister Rabin. I was
not able to t a l k with him myself yet because of the other meetings I
had t h i s morning. I believe the I s r a e l i s are committed to increasing
security where they can do so. And I don't want to comment on that
without some evidence or reason to believe i t s true.
Q
Mr. President, there's a G-7 meeting on Saturday in
Frankfort. I t ' s supposed to focus on Russian aid. Do we go to that
meeting with any particular proposition on the speed of aid, or the
conditionality of aid to Russia? And also, at that meeting, Bentsen
w i l l be meeting with Japanese Finance Minister F u j i i regarding the
f a i l e d trade talks, framework t a l k s . Do you see the Gephardt and
Rockefeller open markets s t i l l being helpful to your mission to open
markets i n Japan? Do you support that?
THE PRESIDENT: Well, we've taken no position on any
p a r t i c u l a r l e g i s l a t i o n . I think that i t shows the determination of
the American people to improve our trade and open the markets;
MORE
�- 4 -
especially the involvement of Senator Rockefeller, who's actually
lived i n Japan and I think i s thought of genuinely as a friend of
Japan, but someone who understands what i s at stake here.
With regard to the other question, I think we're where
we always have been. The kind of aid and the amount of aid which
w i l l flow to Russia, and the sources from which i t flows I think w i l l
be a function of the p o l i c i e s and conduct of the Russians.
Q
Are you concerned now, s i r , apart from the Ames
case, about other developments i n Russia that might make your policy
there appear almost to be i n denial, based on what you and others
wish were happening or hope w i l l happen, rather than what r e a l l y i s
happening there?
THE PRESIDENT: No, I mean, t h i s has — my policy has
nothing to do with what I wish or hope w i l l happen. Our response
w i l l be dictated by t h e i r behavior. But I think the — what I think
i s naive in t h i s whole element i s the suggestion that we should have
ever believed for a moment that every event in Russia and every
speech made by every Russian p o l i t i c i a n in every election of every
member of Parliament would somehow be in a constant straight l i n e
toward a goal that we wanted to predetermine. They have to make
t h e i r own future. That's what I said there over and over again.
This i s not black and white; t h i s i s grey. There w i l l
be developments over the course of our relationship with Russia which
— as there are over the course of our relationship with every other
country — where we won't l i k e everything that happens. We should do
things based on a clear-headed appreciation of what i s i n our
national i n t e r e s t .
No one has made a compelling case to me, publicly or
privately, that i t i s not i n our national interests to continue to
work with the President of Russia and the government of Russia on
denuclearization, on cooperation and respect for neighbors and on
economic reform where we can support i t . That i s , the privatization
movement, for example, I would j u s t remind you, i s s t i l l going on in
Russia and has b a s i c a l l y occurred more rapidly there than in other
former Soviet countries.
So I don't believe the fact that a few speeches are made
that we don't agree with, or that p o l i c i e s are pursued based on an
election they had for a Parliament that we don't agree with should
force us to abandon what i s i n our national i n t e r e s t . When i t i s no
longer i n our national interest to do these things, then we should
stop i t . But we cannot be allowed — deluded into thinking that our
national i n t e r e s t can be defined by every election and every speech
in Russia; that can't be.
Q
Mr. President, in i n v i t i n g the parties to come here
to Washington, do you also anticipate that you or the Secretary of
State w i l l adopt a different posture toward these negotiations? Up
to now, we've kind of l e t them handle i t and keep a hands-off
approach — wisely. But do you see, in fact, now that they're going
to be here and given the urgency you've assigned to i t , do you see
yourself or the Secretary taking a different posture toward the
talks?
THE PRESIDENT: I think, f i r s t of a l l , the very act of
i n v i t i n g them here indicates some sense of urgency on our part. What
we have done to date, as you know, i s largely to t r y to give both
sides the security they needed to proceed, and the assurances that we
would support i t , but that they would have to freely make the
agreement. We s t i l l believe they w i l l have to freely agree.
We believe they are close to agreement. We want to do
things that w i l l prevent t h i s l a s t t e r r i b l e incident from derailing
MORE
�- 5 -
that, and to t r y to send a signal to the peoples in the region to not
overreact to t h i s horrible act, that the path of peace i s s t i l l the
right path. Whether that w i l l require us to do more in p a r t i c u l a r
meetings, I can't say, because we have discussed t h i s with Chairman
Arafat, with Prime Minister Rabin because we wanted to move quickly
and they did, too, and we'll j u s t have to wait for that to unfold.
Q
Mr. President, Senator Nunn has j u s t said that we
should not be asking Russia to voluntarily bring back t h e i r
diplomats, but we should have simply expelled them the way we would
have during the Cold War and after the Cold War; that t h i s i s too
serious a case. Why didn't we j u s t expel the diplomats s t i l l working
here?
THE PRESIDENT: I think that the judgment of the
security services was — and the national security team — was that
the Russians ought to be at least told what we know — not negotiated
with, there was no negotiation — told what we know and given an
opportunity to take whatever action they wanted to take. And i f they
don't, then we w i l l do what we should do. And we w i l l take
appropriate action. We w i l l do that soon.
Q
Mr. President, does that also mean, as Senator
Leahy and Senator Mitchell and others are suggesting following your
meeting t h i s morning, that you, the United States government, w i l l
also expose Russian diplomats who are, in effect, who are r e a l l y
i n t e l l i g e n c e o f f i c e r s who are not declared to the U. S. government as
i n t e l l i g e n c e o f f i c e r s ? Will you take that step and, i f you do, don't
you i n v i t e r e t a l i a t i o n , counterexpulsions, counterdeclarations,
exposures on the part of the Russian government against U.S.
o f f i c i a l s i n Moscow?
THE PRESIDENT: We intend to take the action that we
think i s appropriate and you won't have to wait long to find out what
that i s .
Q
Mr. President, are you i n any way interfering with
the j u d i c i a l process in appearing with Congressman Rostenkowski in
I l l i n o i s on Monday? There have been suggestions
THE PRESIDENT:
Absolutely not.
Q
— that Attorney General Reno had concerns that you
would be appearing with someone under investigation?
THE PRESIDENT: F i r s t of a l l — l e t me make a couple of
comments about that. F i r s t of a l l , I have had no conversations to
that e f f e c t with anyone in the J u s t i c e Department. Secondly, there
i s no way i n the world we would do anything l i k e that. Thirdly, this
investigation has been going on for months. I have been in Chicago
before with Congressman Rostenkowski.
I am going there and w i l l be
with other members of Congress, at l e a s t one other I know and perhaps
more, to t a l k about issues that d i r e c t l y r e l a t e to t h i s
administration's work that he i s a c r i t i c a l part of: health care and
crime. And f i n a l l y , there i s s t i l l a presumption of innocence in
t h i s country. He has not yet been charged with anything.
But I can t e l l you, there has been absolutely no contact
of any nature about t h i s case with the J u s t i c e Department and the
White House that anyone could draw any inference of impropriety on.
And I have received nothing back the other way that I shouldn't go to
Chicago. I am going there to fight for things I believe in that he
has played a c r i t i c a l role i n . I am going to be with at l e a s t one
other, perhaps more members of Congress — I don't know yet — and
I'm going to be doing something that I have already done while this
investigation has been going on. No one ever said anything about i t
before.
MORE
�- 6-
Q
You said that the Ames case had caused s i g n i f i c a n t
damage to the national security. Can you be more s p e c i f i c , s i r ? And
secondly, you've said the FBI investigation i s ongoing. Are you
s a t i s f i e d that we know the f u l l extent of the penetration of the CIA
at t h i s point?
THE PRESIDENT: Well, I can say very l i t t l e about that
except to assure you — I talked with Director Freeh t h i s morning
myself — I am confident that the FBI, working with the CIA, i s doing
everything that i s humanly possible to f u l l y investigate t h i s case.
I do not want to r a i s e red herrings or other p o s s i b i l i t i e s , only to
say t h i s : that i t i s not unusual, as the FBI Director said t h i s
morning. Sometimes i t happens that when you're i n a criminal
investigation and you're on to something, the investigation turns up
information that could not have been anticipated i n the beginning. I
am not t r y i n g to say that has occurred. I'm not trying to r a i s e any
f a l s e hopes. A l l I'm t e l l i n g you i s , I have directed the FBI and the
CIA and everybody else to do everything they can to get to the f u l l
bottom of t h i s . And I have nothing else to say about i t .
And, again, I'm not trying to r a i s e some t a n t a l i z i n g
inference, I'm j u s t saying that we have to keep going and t r y to root
i t out. After a l l , t h i s i s fundamentally a problem within America,
about whether people here who are Americans are spying, and that's
our r e s p o n s i b i l i t y to t r y to find i t out.
Thank you.
THE PRESS:
Thank you.
END
12:16 P.M. EST
�
Dublin Core
The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/.
Title
A name given to the resource
Office of Press and Communications - Philip J. “P.J.” Crowley
Creator
An entity primarily responsible for making the resource
National Security Council
Is Part Of
A related resource in which the described resource is physically or logically included.
<a href="http://clinton.presidentiallibraries.us/items/show/36076">Collection Finding Aid</a>
Identifier
An unambiguous reference to the resource within a given context
2011-0516-S
Description
An account of the resource
This collection consists of White House press releases from the files of P.J. Crowley. Crowley served as Special Assistant to the President for National Security Affairs and Senior Director of Public Affairs the National Security Council from 1997–1999. The press releases are arranged by subject or, as in the case of the Weekly Compilation of Presidential Documents, by date.
Provenance
A statement of any changes in ownership and custody of the resource since its creation that are significant for its authenticity, integrity, and interpretation. The statement may include a description of any changes successive custodians made to the resource.
Clinton Presidential Records: White House Staff and Office Files
Publisher
An entity responsible for making the resource available
William J. Clinton Presidential Library & Museum
Extent
The size or duration of the resource.
370 folders in 33 boxes
Text
A resource consisting primarily of words for reading. Examples include books, letters, dissertations, poems, newspapers, articles, archives of mailing lists. Note that facsimiles or images of texts are still of the genre Text.
Original Format
The type of object, such as painting, sculpture, paper, photo, and additional data
Paper
Dublin Core
The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/.
Title
A name given to the resource
Russia [2]
Creator
An entity primarily responsible for making the resource
National Security Council
Office of Press and Communications
Philip "PJ" Crowley
Identifier
An unambiguous reference to the resource within a given context
2011-0516-S
Is Part Of
A related resource in which the described resource is physically or logically included.
Box 12
<a href="http://catalog.archives.gov/id/7585702"></a>
<a href="http://clinton.presidentiallibraries.us/items/show/36076">Collection Finding Aid</a>
Source
A related resource from which the described resource is derived
7585702
42-t-7585702-20110516s-012-016-2015
Provenance
A statement of any changes in ownership and custody of the resource since its creation that are significant for its authenticity, integrity, and interpretation. The statement may include a description of any changes successive custodians made to the resource.
Clinton Presidential Records: NSC Cable, Email, and Records Management System
Publisher
An entity responsible for making the resource available
William J. Clinton Presidential Library & Museum
Format
The file format, physical medium, or dimensions of the resource
Adobe Acrobat Document
Medium
The material or physical carrier of the resource.
Preservation-Reproduction-Reference