AMBASSADOR JOHNSTONE: Thank you very much, Jim. I'm here sporting
two buttons today. The one which was given out this morning at
the White House, representing the fact that this is the first
budget that we have submitted in 30 years that has no addition
to the deficit; hence the big zero. But I don't want to confuse
you, but on the other side there's one that says 1 percent, which
is a reiteration of the fact that we cost only 1 percent of the
federal budget for all the things that we get done in international
affairs.
I wanted to start today by saying, first and foremost, that Secretary
Albright and I worked last week to prepare her to give the opening
statement here; and I know that she would have wanted to be here
if she could. But alas, as you know, the items - the issues that
she's working on in the Gulf have captured her attention today.
This international affairs budget serves seven national interests.
I'll turn to these first. Many of you have been briefed on the
international affairs strategic plan, and you will recognize the
seven interests that come out of this plan. There are seven things
that we in the Department of State are trying to get done on behalf
of the American people -- the Department of State and the International
Affairs agencies as a whole.
The first, to protect our national security - and of course, the
Secretary is in the Gulf right now, working on aspects of national
security that deal with both regional stability as well as the
elimination of weapons of mass destruction.
The second, to protect the economic prosperity of the American
people; to help to promote exports around the world; to try and
service our economic interests by supporting the American business
community, by essentially staffing the Americas desk in the Department
of State, but also through the extraordinary efforts that are
done by Ex-Im Bank, OPIC, TDA to promote American exports around
the world and the efforts of AID to grow foreign markets.
Thirdly, the protection of American citizens and US borders -
over a million times a year, people call upon embassies overseas
for services. Our presence worldwide helps to serve those Americans
who are traveling around the world. Plus, in addition, we also
protect US borders in the sense that we monitor and regulate the
flow of people to and from this country. The number of foreign
visitors that we have visiting the United States each year goes
up geometrically. This is a growing workload, a growing burden
and a growing responsibility for the State Department.
Fourthly, try to protect Americans from international crime, narcotics
trafficking and terrorism - a growing area of concern. There
was a time when international crime did not impinge directly on
the lives of Americans in the way that it does today. This is
an area of growing interest, and an area of growing funding within
the budget, as well. We'll get back to that in a second.
Fifth, we promote democracy and human rights as being core values
of ours; therefore, we consider the promotion of these values
to be in the national interest. Sixth humanitarian response -
we, in keeping with our values, and we provide humanitarian assistance
to victims of crises and disasters around the world, provide humanitarian
assistance to the poor wherever we find them in the world. Finally,
seventh, we protect American interests on a new range of global
issues - particularly those dealing with the environment, with
population and with the spread of contagious diseases around the
world.
In each of these areas, International Affairs programs are designed
to try and help Americans. The emphasis here is on serving Americans
in each of these seven areas. Now, I want to show you a breakdown
of the costs in this International Affairs Budget of the programs
that service these national interests. This is broken down by
program type, not necessarily by national interest.
Let me explain very quickly that it's possible to serve an American
national interest of immigration, for example, by bolstering the
economies of neighboring countries. This chart is not designed
to show you the breakdown by national interests, as much as by
program type. So economic programs, security programs, American
citizen programs, law enforcement, democracy and human rights
are categorized in this budget. You'll see the general breakdown
here of these programs in millions of dollars starting with the
largest being the security programs at $5.7 billion, adding up
to the total budget request of $20.150 billion.
Let me turn now very quickly to the appropriation line items.
Our budget request this year is $20.15 billion, as compared to
an appropriated level this past year of $19.03 billion - so an
increase of about $1 billion in this year's request versus last
year's appropriation level. That, in turn, is higher than the
$18.2 billion which we received in 1997. So we are essentially
asking for the second year of increase in International Affairs
funding; a modest increase, though, let me hasten to add, this
is the fifth time that I have been before the press, presenting
a budget. The first time, if I look at it in 1998 dollars, I
presented to you a budget that was at $23 billion. So it gives
you some sense of the perspective of how far the budget got cut
back, and the very slow and incremental increase that we are seeking.
We have tried to find the balance between being responsible and
maintaining American global leadership, and also meeting the requirements
of the balanced budget. We have, this year, I think, achieved
success in that area. We have a good, solid budget request at
$20.15 billion that we think protects American interests, protects
American leadership around the world in all of the areas that
I showed you; but which also makes its own contribution to a balanced
budget.
I will leave it for you-I think you all have copies of the highlights
- to go through the individual accounts. I'm not going to go
through every account here with you. I thought I might, instead,
tell you what's new about this budget.
First of all, it contains a number of new programs for Africa.
The President's Partnership for Economic Growth and Opportunity
includes $35 million in debt programs, which are carried under
the special debt relief line here. You'll see the big increase
from $27 million to $72 million. Well, $35 million of that increase
is for Africa, and is part of the President's Partnership for
Economic Growth and Opportunity. In addition to that, $30 million
of Development Assistance Funds in the AID Development Assistance
line here have also been designated for that Africa initiative.
Beyond that, the Secretary announced a Great Lakes initiative,
focused on Rwanda and Burundi, during her visit to Africa. That
is being funded mostly by ESF, at $30 million. That is included
within the Economic Support line here for the ESF account at $30
million. This is a program that involves also looking at trying
to enhance trade and investment opportunities in Africa, and taking
a second look at our GSP preference structures, as it pertains
to certain African countries.
There's an education and development program, which we are in
the process of creating, that will be taken out of existing resources
contained in this budget, that will come in at about $76 million.
It will use a mix of Development Assistance, PL-480 funds, Economic
Support Funds, Peace Corps and USIA funds.
In addition to the Africa programs, we'll have a $20 million Development
Assistance program for a Summit of the Americas follow-up. This
will essentially fund micro-finance projects in Latin America.
It will have a strong emphasis on educational programs in Latin
America, and also promote free trade and investment in the region.
The Office of Transition Initiatives is being increased from $30
million to $45 million. This is an office of AID, and it's funded
out of the Disaster Assistance Account. International Disaster
Assistance has gone from $190 million to $205 million. That $15
million is for the Office of Transition Initiatives. This is
a program to try and help countries that are moving out of anarchy
and civil strife, and put them on the road to sustainable development.
A big increase in this budget is an increase that we are requesting
for the Newly Independent States of the former Soviet Union.
We are requesting $925 million versus an appropriation of $770
million this past year. Now, this past year we did request $900
million. This continues the Partnership for Freedom initiative
within the NIS. This is an initiative to try and stimulate private
sector investment in the NIS countries as part of our effort to
try and help them in their transition to market democracy.
This year we will fund $10 million of Economic Support Funds for
a fund to aid the victims of the Holocaust. This is a $24 million
initiative. We have funding of $4 million of it in 1998. We'll
be funding $10 million each in 1999 and the year 2000. This is
a multilateral effort. A number of countries are contributing
to this fund, and the purpose of it is to help those people who
- the poor people -- who were affected by the Holocaust, and
to provide some relief for them.
We will, in Economic Support Funds, be seeking a substantial increase
from $70 million to $140 million for Haiti. Our efforts in Haiti
are designed to try and build that economy and begin the process
of moving it to self-sustainability. We don't feel we can do
that at the current levels of funding -- the $70-million level
that we have been capped at by the Congress. We're going to seek
an effort to try and get that cap removed and to get the levels
up to $140 million in Fiscal 1999.
Included in this budget also is a $50-million de-mining initiative
within the NADR account. That is a Nonproliferation, Anti-terrorism,
De-mining and Related programs account here. That will be a $50
million program, up from $20 million in Fiscal 1998.
Ex-Im Bank. There has been a substantial increase in demand for
Ex-Im Bank credits. That demand was recognized by the Congress
that appropriated us $696 million in 1998, more than we had actually
requested. We recognize that demand and have increased the Ex-Im
Bank funding for Fiscal 1999 to $824 million, to be able to substantially
meet the new requirements for Ex-Im Bank lending around the world.
The Peace Corps initiative, to raise the total Peace Corps enrollment
to 10,000 people by the year 2000, is funded also in this budget.
This budget will fund the increment from 6,500 - the current
level of the Peace Corps - to 8,500 people. The next increment
would be funded in next year's budget.
A change on previous years -- we have, in the refugee account,
sought exactly the same amount of money as we have always sought
in refugee assistance, within the regular refugee account, the
Migration Refugee Assistance Account, but the ERMA contingency
fund, the Emergency Refugee Migration Account number, being sought
this year is $20 million. We have accumulated $120 million in
the ERMA account. We didn't feel that we needed to ask for the
normal full $50 million replenishment. So, that program has been
cut back somewhat this year, because we have adequate reserves
in the ERMA account.
We are requesting a substantial increase, from $231 million to
$275 million, to try and fight international narcotics. I'd like
to remind you that this is a very, very small percentage of the
total amount that we spend on narcotics-fighting as a country,
on governmental programs. It comes to about 3 percent of the
total, in fact, and represents extremely cost-effective utilization
of funds in the war against narcotics.
We have experienced some very real results in this program over
the course of the last two years. I know that cultivation in
Peru, for example, and the production out of Peru is down by 40
percent, largely as a result of this program's activities. We
intend to follow up on those activities, particularly in Latin
America and the Andean countries, by augmenting this program up
to $275 million.
On the Commerce-Justice-State side of the budget, the State Department
operations account shows a 4.8 percent increase. That increase
will fund a very modest increase in personnel -- some 71 people
-- but more importantly, will fund some of the basic requirements
that we have for information systems, our perennial battle to
try and get adequate funding so that we end up being in the 20th
century in information systems.
We are also funding, on the State Department operating side, in
terms of foreign missions activities, two major programs. There
will be $200 million for China and $50 million for Berlin. These
are for new embassy structures in both China and Berlin. I don't
think anybody in this room can have been unaware of the extent
to which our embassy in China has fallen on hard times, if it
ever was in good times, and there is a crying need for a new facility.
This request would fund that new facility.
Finally, we have, under the Asia Foundation, new programs that
would fund rule-of-law programs in Asia, as a whole, and in China,
in particular.
So that, in essence, is what it is that we have in the budget.
Let me highlight a couple of other items that are also taking
place at the same time that the budget goes forward to the Congress.
There will be supplemental requests which will total, for arrearages
to international organizations, including the United Nations,
$1.021 billion ($921 million is a supplemental appropriation and
authorization of $100 million already appropriated).
There are no United Nations arrearages in this budget package,
as you see it here or as you see it in the table that you have
in your handout. There are multilateral development bank arrearages
in this overall multilateral development bank number. That is,
there are $502 million of arrearages in that MDB line. To reiterate,
there are no international organization arrearages; there are
MDB arrearages in the budget request itself. In addition to the
budget request, we're going to have $1.021 billion requested in
the form of a supplemental.
Two other items that will be also requested in the form of a supplemental,
one is the IMF quota increase at $14.5 billion. That comes with
no outlays. This is a no-outlay account, only budget authority.
And, a $3.5-billion New Arrangements to Borrow facility is also
being requested in the form of a supplemental appropriation.
So with that, I think I'd like to turn it over to my colleague,
Assistant Secretary Geithner from the Department of Treasury,
to talk about those two supplementals.
Tim.
ASSISTANT SECRETARY GEITHNER: Thanks. I'm here to give you just
a few of the facts on the President's request relating to the
International Monetary Fund. This is a moment of some delicacy
in the international financial system, and because of the serious
potential risks we see to US interests in this unfolding crisis,
the President has asked the Congress today to authorize US participation
in the new arrangements to borrow and in the pending increase
in IMF quotas, roughly, 3.4 -- I think 3.5, depending on the exchange
rate, for the new arrangements to borrow.
The new arrangements to borrow is an emergency fund, like a reserve
tank, that's available to the IMF in the event of serious threats
to the stability of the international financial system. This
is a fund that we proposed establishing first in 1995, after the
initial onset of the Mexican financial crisis.
The 14.5 is for the IMF quota increase, which is the normal periodic
increase in the IMF's regular standing - some call it its regular
capital base. These resources are both used to provide temporary
financial assistance in support of programs of economic reform,
to help restore financial stability in these countries, to support
policies that promote stronger, more stable exchange rates, and
that encourage a quick return to growth.
These are large and bracing numbers, but they entail, as Craig
said, no budget outlay. They don't come at the expense of other
programs and priorities. And they are provided for in the adjustments
to the caps, to the caps on budget authority that were negotiated
and built into last year's budget agreement.
These entail no outlays because the IMF acts essentially as a
credit union. We provide a credit line to the International Monetary
Fund, and when the IMF draws on that credit line, we get a liquid
interest-bearing deposit in the IMF, backed by its substantial
gold reserves. And for that reason, our participation in the
IMF has always been or has long been treated as an exchange of
assets, with no outlay.
We submitted these as supplemental requests because we feel it's
important to move forward quickly to ensure that the IMF has the
resources necessary to deal with any spread or intensification
of the current crisis, and we're in the process of consulting
with the congressional leadership and all the relevant committees
on how best to move forward to ensure the US can participate in
both the NAB and the quota increase.
It's important to recognize that neither of these will happen
without us. The NAB will not be established without the United
States, and the quotas will not be increased without the United
States. And that's one reason we think it's prudent to try and
move forward as quickly as possible to get these done.
Thank you.
AMBASSADOR JOHNSTONE: I'll be glad to take your questions.
QUESTION: I was going to ask the Assistant Secretary how serious the IMF
cash flow situation is.
ASSISTANT SECRETARY GEITHNER: The IMF has a significant but substantially
depleted cushion now available to deal with financial crises.
I'm happy to walk through the numbers separately with you, if
you like. But we think there's been such a substantial depletion
of this resource, and we're at a moment of such uncertainty in
the system as a whole that we really think the prudent thing to
do is try and move forward quickly to expand those normal resources.
But if you want to talk separately about the specific numbers,
I'm happy to do so.
QUESTION: Does this budget assume that ACDA and USAID will not be voted
into State?
AMBASSADOR JOHNSTONE: It was necessary, in this budget request,
to break them out separately, because the legislation that would
cause them to be integrated hasn't been passed yet. Had the legislation
passed, we would not have broken out separately the ACDA request.
We still would have separated USIA, because the plan isn't to
integrate USIA for another year yet. So as soon as the legislation
is passed, you'll start seeing integrated budgets.
QUESTION: Craig, I wanted to ask you two questions quickly. Would you
run those Africa numbers again, please? And then would you explain
why KEDO needs $10 million in supplemental debt service money,
when it's an organization that just got started?
AMBASSADOR JOHNSTONE: I'll be glad to run the Africa numbers
for you while I think of the answer to the other question.
(Laughter.)
We may take a long time on Africa here.
No, the African numbers - the Partnership for Economic Growth
and Opportunity, $35 million in debt relief, specifically targeted
at Africa. I should point out that the special debt relief line
here of $72 million also includes $37 million under the Paris
Club debt relief program for the poorest countries. And some
of those are African countries, as well, but there's a special
$35 million debt relief line for Africa, as part of this initiative,
as well as Development Assistance Funds of $30 million.
The Great Lakes initiative is Economic Support Funds targeted
at the Great Lakes region, specifically trying to bring stability
to an area that has chronic instability and trying to move them
into having functioning judicial systems. I would say in the
first instance, the emphasis of the program is on justice within
the region, and that the program will use some $25 million to
$30 million of ESF. It's a $30 million program. We haven't figured
out the exact components. It depends upon exactly what the program
content ends up being at the end of the day.
Now, back to your question on KEDO, though. We are seeking this
year $35 million for KEDO. That's not out of keeping with what
we have been saying all along KEDO would require. So I'll be
glad to get further into it. Maybe we should talk off-line.
QUESTION: Well, there's a note in here that talks about a $10 million
add-on for debt.
AMBASSADOR JOHNSTONE: For debt.
QUESTION: For debt. I mean, what do we owe them money for?
AMBASSADOR JOHNSTONE: Well, KEDO funds the heavy fuel oil shipments
to North Korea as a part of the agreement, and has been funding
them on the basis of lines of credit, and the debt relates to
that.
QUESTION: I have two questions. One is, if you could say something more
about the new fund for Holocaust victims. Is this for individuals,
organizations, including Americans? How is that going to work?
AMBASSADOR JOHNSTONE: No nationality is being excluded from participation
in the fund, but let me just say that we intend that these funds
would be administered and distributed through non-governmental
organizations; that is to say, there will not be direct applicants
for the funds, but rather the funds will be distributed through
a list of NGOs that has been agreed between the various contributing
nations, and they will be the ones that will administer it.
It is my understanding that the majority of poor victims of the
Holocaust are to be found in Central and Eastern Europe today.
I would expect that they would be the primary beneficiaries of
the program.
QUESTION: My second question deals with Central and Eastern Europe and
the former communist countries. In the past, the budget allocations,
to some degree, reflected political motives or considerations
-- countries that had authoritarian or totalitarian regimes, like
Belarus, for instance, got their aid cut. And I notice in the
detail here that Serbia, Slovakia, Belarus, all countries that
have not fully implemented or even tried to implement economic
and democratic reforms get substantial increases. So could you
explain a little bit the thinking that's gone into this?
AMBASSADOR JOHNSTONE: Well, I think that when you're putting
together a budget request, you are putting together a budget request
on your expectation and hopes for the future. It doesn't always
turn out that we allocate funds exactly the way that they have
been requested.
We're requesting funds for Fiscal 1999 at this stage, and I think
the expectation is that substantial progress will have been made
in trying to meet the kind of reforms that we're trying to advance.
We're essentially putting on the table the fact that we're prepared
to assist. If reforms are not met, then we, of course, reserve
the right to change allocations of funds later on.
QUESTION: For the first time since the 1940s, you canceled request for
foreign military aid or foreign military financing to both Greece
and Turkey. I believe that this financing or military aid or
military financing is a part of both countries' some kind of defense
agreement. Can we trust that the canceling of this request is
changing the both countries' defense agreement?
AMBASSADOR JOHNSTONE: Not probably in the sense that you intend
the question, I suspect. I think you can assume that this represents
the maturing of our relationship; that there is not the need for
the same levels of assistance that we have had in the past, in
order for these countries to continue to play active roles in
NATO. We have had consultations with the countries. We're all
in agreement on the fact that the time to graduate has come, and
this is the first year of graduation. So I think it's a very
mature, responsible relationship that we have with these countries.
I think the fact that they have now graduated away from an assistance
relationship to be much more like all of the other NATO members
is a representation of that.
QUESTION: Mr. Ambassador, it appears, roughly, according to my calculations,
that you're asking for about a little over 5 percent in your increase.
Could you translate that to real growth, minus inflation? And
what is this supplemental about again? I didn't catch that.
That was going to pay UN debts?
AMBASSADOR JOHNSTONE: We are substantially - let me take the
second question - all these questions seem to have two different
parts. The second part of your question - we owe substantial
sums of money to the United Nations by virtue of not having paid
all of our assessments.
We are intending to pay $1.021 billion of these arrearages to
the United Nations and to other international organizations through
the supplemental appropriation route.
You'll bear in mind that we made a similar request last year,
and that at the end of the year, those funds were not appropriated
by the Congress. They were held hostage to the whole population
issue. This is essentially a renewal of that request.
QUESTION: And then the other part was, what's your real growth in this
budget?
AMBASSADOR JOHNSTONE: A difficult question. The domestic deflator
runs around 2 percent; the international deflator, closer to the
4 percent to 5 percent range. Our budget is roughly half and
half, so you'd have to take a mid-line number, so that of your
5 percent increase, then probably 1.5 percent of it represents
real growth. That's about as crude as you can get in terms of
analysis.
QUESTION: In terms of the increased funding you've requested for arrears
for multilateral development banks, I see you have $300 million
down for the global environmental facility, which has been incredibly
unpopular on the Hill. How do you expect to get anywhere near
that amount of money? They haven't funded the $100 million you've
had in previous years.
AMBASSADOR JOHNSTONE: I think the discussions in Kyoto and the
dialogue that we've had domestically have shed a lot of light
on the problems that we face on global climate change.
The GEF is one of the principal mechanisms that we have to address
that issue. Let me correct your numbers a little bit. We're
requesting $300 million for the GEF; only $192 million of that
is for arrearages. The rest is for current assessments for the
GEF.
So a $300 million number will catch us up on our arrearages, meet
our current assessments and then we will be clean going into the
next fiscal year on our obligations for the GEF. We think it's
past time to get these things in order.
QUESTION: On page 42, there's a footnote number two that this is for NIS
and that includes $1 million in parking fines. What is that?
AMBASSADOR JOHNSTONE: This is on page 42;let me go to page 42.
But Kathleen, I think you - are you our expert on parking fines?
JIM PAINTER, AID: There is a requirement in the Foreign Operations
Appropriations Act that would withhold foreign assistance for
those countries which do not pay parking fines in the District
of Columbia. We withhold those funds until the fines have been
paid, at which time we would release the funds to that country.
AMBASSADOR JOHNSTONE: Jim Painter, of AID, who stepped in to
answer the question. Thank you very much.
QUESTION: Which countries will be entitled for the Holocaust funds, and
under which criteria?
AMBASSADOR JOHNSTONE: It is not countries that will be entitled
to the Holocaust fund, but rather individuals who will be entitled
to receive funds from non-governmental organizations, who will
be the first recipients of the funds. So the funds will be distributed
to the victims of the Holocaust, who will apply to non-governmental
organizations who will receive the funds directly.
QUESTION: But what countries will have these individuals?
AMBASSADOR JOHNSTONE: It is not broken out by country. It's
not a country-level program. This will be done by non-governmental
organizations, for wherever the victims happen to be. No country
is excluded; this is not a country-level program.
QUESTION: So as a follow-up to your answer on the supplemental, you mentioned
that those funds were held hostage by the Republicans at the end
of the last session. Do you have any reason to believe that those
funds are still not - still won't be held hostage? Have you spoken
with people on the Hill?
AMBASSADOR JOHNSTONE: For all of the issues in which the conditions
were established around the population issue -- that is to say
the organizational issue as well as the New Arrangements to Borrow
and the arrearages for the international organizations -- is we
intend to argue very strongly for de-linkage of those issues from
the population issue. We don't think that it is a responsible
course for the Congress to take, to deny funding for critical
US national interests on the pretext that somehow it's linked
to the population issue, which clearly it is not.
QUESTION: One follow-up, then, do you have any allies, specific allies,
you can mention on the Republican side in the Republican leadership
for this?
AMBASSADOR JOHNSTONE: I think there is a growing sense up on
the Hill that we need to move ahead with these programs, and that
they cannot continue to be stalled on this issue. I don't want
to get into specific names.
QUESTION: A question about the New Independent States. Armenia receives
more US Government assistance per capita than any other republic
in the new independent states. At the same time, we know that
Armenia occupies 20 percent territory of Azerbaijan and have military
cooperation with Russia. Armenia recently received Russian arms
worth $1 billion. Should we conclude that the US considers Armenia
to be a model for the other states in the new independent states?
How can you explain why Azerbaijan received only $21 million,
when Armenia receives $87 million?
AMBASSADOR JOHNSTONE: First of all, I think it's a serious mistake
in terms of funding assistance levels, to try and take a specific
number and attribute to it an importance of a relationship. What
we do, in trying to develop the numbers, is to try and measure
what the circumstances are in the specific country, in terms of
need; what the degree of reform impetus is that exists within
the country; what we think is likely to happen over the next couple
of years; and put forth a program that best matches our national
interests in that regard, with all of those situations on the
ground.
The breakout that you see here, I think, satisfies that requirement,
but certainly doesn't represent one country being more or less
important to us than any other country.
AMBASSADOR JOHNSTONE: If I could just take this gentleman here
first.
QUESTION: You maintain the traditional levels of funding for the Middle
East in this budget. The Israelis have come in suggesting that
they would be willing to forego some of their economic aid in
return for some enhanced military assistance, and with the total
level coming down. Is there a reason that you have - is it just
a matter of timing that that wasn't addressed in this budget request?
And if there are savings from the Israeli Government, would that
be kept in the Middle East, let's say, or does that go somewhere
else?
AMBASSADOR JOHNSTONE: Our request has been to try and keep funding
in the aggregate for the Middle East at traditional levels. I
think we have a lot of discussions to hold with the parties within
the region, directly, as well as with the Congress, on how exactly
that should be administered, given the proposals made by the government
of Israel, and given also the needs of other countries in the
region.
QUESTION: On page 46, there is a line there, "South Asia regional
democracy." What exactly is that?
AMBASSADOR JOHNSTONE: I beg your pardon?
QUESTION: There is a line there, on page 46, "South Asia regional
democracy." What exactly is that?
AMBASSADOR JOHNSTONE: We have, within each of the regional areas
of the world, set aside some funds for the promotion of democratic
institutions. These are usually relatively small programs. They
get into the issues of training judiciaries, exchange programs
-- a whole series of things that help to solidify democracy or
essentially to form partnerships with other democratic states
within the regions. We did not have a fund for South Asia for
some number of years. This past year we established one. We
intend to continue on into this next year with that kind of program.
QUESTION: The President is supposed to go to Latin America, to Africa
and to South Asia this year. I notice you have new programs for
each area. Is there a connection between the fact that he's visiting
and the fact that you're having new programs for each of these
areas?
AMBASSADOR JOHNSTONE: We have new programs for each of these
areas probably most years, including the years in which he doesn't
visit. I think we try and base our programs on the basis of need
within the respective areas. Certainly, the program for the Summit
of the Americas is designed to try and meet our commitments under
the agreements that have already been reached, not future commitments
on the Summit of the Americas.
Clearly, when a President of the United States visits a region,
it causes a lot of focus of attention on policy, and it can cause
some readjustment of policy, as well as how we dispose of funds,
but not specifically, no.
QUESTION: The Central Europe defense loans program, is that a new program?
AMBASSADOR JOHNSTONE: No, it is not.
QUESTION: How does that compare with previous years?
AMBASSADOR JOHNSTONE: There you've got me. Do we have - is Tom
here?
STATE DEPARTMENT OFFICIAL: Same level.
AMBASSADOR JOHNSTONE: Same level as previous years.
QUESTION: The NATO Partnership for Peace, is that the same level, as well?
AMBASSADOR JOHNSTONE: We have - here you're talking about things
that occur in more than one budget, so I need to be a little bit
careful. We had set out $100 million as being the level that
we wanted to have for Partnership for Peace/Central-Eastern Europe
loan programs. And that is the level that it's at in this budget.
In any given year, because Defense also has programs that relate
to building up the capacity of some of these countries to join
NATO, the levels may fluctuate. But I'm not sure if the net level
is different this year for our programs. They are more or less
in the same ball park.
QUESTION: Yes, could you give a breakdown on the UN and other organizations
arrears number -- the $1.021 billion that you would request in
the supplemental?
AMBASSADOR JOHNSTONE: No, the reason being that we're looking
at the issue right now, in terms of how we would want to allocate
those funds, and we have not yet decided on what the allocation
should be.
Our total arrears, as counted by the international organizations
themselves, is actually somewhere on the order of $1.5 billion.
So we will have some discretion in terms of which arrears we
want to meet now and which ones we want to meet at some later
time. And we haven't come to a final conclusion. I don't think
we will come to a final conclusion until we've had discussions
with the Congress on that issue.
QUESTION: One more question on Russia. It really jumps out at you from
the page, it's such a huge increase, from $129 million to $225-plus
million. Can you give us an idea of where all that's going?
Is this all for the economic initiative?
AMBASSADOR JOHNSTONE: I'd be delighted. I think what should
jump out at you from the page is the $129 million number, not
the request number. Our request has always been substantially
higher for Russia than what it is that we have been allowed to
spend in Russia, as a result of congressional earmarks that don't
relate to Russia at all, but relate to other countries. So when
the Congress has imposed requirements that we fund other countries
at specific levels, they have left only a residual amount for
Russia that we have considered, consistently, to be inadequate
to meet our security requirements in Russia.
So this simply restates what we have always considered to be our
security requirements in Russia, and doesn't represent a change,
in that sense, from past practices. What we think is necessary
is to get the overall level of the NIS account, the Freedom Support
Act funds, up to a level that we can fund, not just the other
countries of the NIS adequately, but also fund Russia adequately,
as well.
QUESTION: Ambassador, why your government has decided to terminate all
the FMS military program to Greece and Turkey? Is there any specific
reason for this?
AMBASSADOR JOHNSTONE: I think it is part of a normal process.
We announced our intent to terminate these programs three years
ago. We announced our intent two years ago. We finally got around
to doing it. The honest answer is that this has been the subject
of considerable discussion in the past. We've all known that
we were coming up to the day in which graduation would take place.
We've had consultations with the governments involved. This
is the right moment to do it, and we've gone ahead and done it.
Any more questions?
(No response.)
AMBASSADOR JOHNSTONE: I'd like to thank - well, I'll take one
more, then. Yes.
QUESTION: Building the new embassies, that's also in Berlin as well as
in China, you said?
AMBASSADOR JOHNSTONE: Yes. The current embassy is in Bonn, as
you know, and needs to be moved to Berlin. So we need a new structure
to put the new embassy into.
QUESTION: I missed the number for the Bonn embassy.
AMBASSADOR JOHNSTONE: $50 million.
QUESTION: Million.
AMBASSADOR JOHNSTONE: Thank you very much.
QUESTION: Thank you.
[end of document]