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U.S. INTERESTS IN THE ASIA-PACIFIC:

FY 2018 BUDGET HEARING

HEARING

BEFORE THE

SUBCOMMITTEE ON ASIA AND THE PACIFIC

OF THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED FIFTEENTH CONGRESS

FIRST SESSION

JULY 27, 2017

Serial No. 115–73

Printed for the use of the Committee on Foreign Affairs

(

Available via the World Wide Web: http://www.foreignaffairs.house.gov/ or

http://www.gpo.gov/fdsys/

(II)

COMMITTEE ON FOREIGN AFFAIRS 

EDWARD R. ROYCE, California, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

ILEANA ROS-LEHTINEN, Florida 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

JOE WILSON, South Carolina 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

DARRELL E. ISSA, California 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

MO BROOKS, Alabama 

PAUL COOK, California 

SCOTT PERRY, Pennsylvania 

RON DESANTIS, Florida 

MARK MEADOWS, North Carolina 

TED S. YOHO, Florida 

ADAM KINZINGER, Illinois 

LEE M. ZELDIN, New York 

DANIEL M. DONOVAN, JR., New York 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

ANN WAGNER, Missouri 

BRIAN J. MAST, Florida 

FRANCIS ROONEY, Florida 

BRIAN K. FITZPATRICK, Pennsylvania 

THOMAS A. GARRETT, JR., Virginia 

ELIOT L. ENGEL, New York 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

KAREN BASS, California 

WILLIAM R. KEATING, Massachusetts 

DAVID N. CICILLINE, Rhode Island 

AMI BERA, California 

LOIS FRANKEL, Florida 

TULSI GABBARD, Hawaii 

JOAQUIN CASTRO, Texas 

ROBIN L. KELLY, Illinois 

BRENDAN F. BOYLE, Pennsylvania 

DINA TITUS, Nevada 

NORMA J. TORRES, California 

BRADLEY SCOTT SCHNEIDER, Illinois 

THOMAS R. SUOZZI, New York 

ADRIANO ESPAILLAT, New York 

TED LIEU, California

AMY PORTER, Chief of Staff THOMAS SHEEHY, Staff Director

JASON STEINBAUM, Democratic Staff Director 

SUBCOMMITTEE ON ASIA AND THE PACIFIC

TED S. YOHO, Florida, Chairman 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

TOM MARINO, Pennsylvania 

MO BROOKS, Alabama 

SCOTT PERRY, Pennsylvania 

ADAM KINZINGER, Illinois 

ANN WAGNER, Missouri 

BRAD SHERMAN, California 

AMI BERA, California 

DINA TITUS, Nevada 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

TULSI GABBARD, Hawaii 

(III)

C O N T E N T S 

Page

WITNESSES 

Ms. Susan Thornton, Acting Assistant Secretary, Bureau of East Asian and 

Pacific Affairs, U.S. Department of State .......................................................... 8

Ms. Gloria Steele, Acting Assistant Administrator, Bureau for Asia, U.S. 

Agency for International Development .............................................................. 16

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

The Honorable Ted S. Yoho, a Representative in Congress from the State 

of Florida, and chairman, Subcommittee on Asia and the Pacific: Prepared 

statement .............................................................................................................. 3

Ms. Susan Thornton: Prepared statement ............................................................. 10

Ms. Gloria Steele: Prepared statement .................................................................. 18

APPENDIX 

Hearing notice .......................................................................................................... 42

Hearing minutes ...................................................................................................... 43

The Honorable Gerald E. Connolly, a Representative in Congress from the 

Commonwealth of Virginia: Prepared statement .............................................. 44

Questions submitted for the record by the Honorable Eliot L. Engel, a Representative in Congress from the State of New York ....................................... 46

Written responses from Ms. Susan Thornton and Ms. Gloria Steele to questions submitted for the record by the Honorable Ami Bera, a Representative 

in Congress from the State of California ........................................................... 50

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U.S. INTERESTS IN THE ASIA-PACIFIC:

FY 2018 BUDGET HEARING 

THURSDAY, JULY 27, 2017

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON ASIA AND THE PACIFIC,

COMMITTEE ON FOREIGN AFFAIRS,

Washington, DC. 

The subcommittee met, pursuant to notice, at 2:30 p.m., in room 

2172 Rayburn House Office Building, Hon. Ted Yoho (chairman of 

the subcommittee) presiding. 

Mr. YOHO. The subcommittee will come to order. 

Members present will be permitted to submit written statements 

to be included in the official hearing record. Without objection, the 

hearing record will remain open for 5 calendar days to allow statements, questions, and extraneous materials for the record subject 

to lengthen—or to length limitations in the rules. 

Good afternoon again. We call this hearing to order pursuant to 

our congressional oversight responsibilities to discuss the administration’s fiscal year 2018 state and foreign operations budget request for the East Asia-Pacific region. On behalf of the subcommittee, I thank the panel for joining us today to share the insights and expertise they have gained over—and I don’t want them 

to be offended—over their lengthy diplomatic careers as we deliberate this important topic. 

East Asia and the Pacific represents the opportunities and challenges of this century like no other part of the world. Just over 30 

percent of the world’s population lives in this region. It accounts for 

the same share of global GDP and continues to lead the world in 

annual GDP growth. Four of the top ten U.S. trading partners are 

located in this area. Five of the United States’ seven collective defense arrangements are located in the Asia-Pacific region where 

over 63,000 U.S. troops are stationed. 

This region is home to what many believe to be our most urgent 

existential threat, the nuclear belligerence of North Korea. We also 

see rising Islamist militancy and major territorial disputes in the 

South China Sea, the East China Sea, and the Sea of Japan. About 

a third of the world’s maritime trade passes through these disputed 

areas, as does most of the energy supply of South Korea, Japan, 

and Taiwan, all critical U.S. security partners. This is the same 

area over which China, our chief global rival, seeks hegemony. 

The importance of East Asia to U.S. interests is beyond doubt. 

If the United States is to remain relevant as a global leader, we 

cannot sit out the transformation happening among our neighbors 

2

across the Pacific. Our diplomatic engagement in the region should 

advance our interests throughout Asia and should also be the first 

line of American defense among its many security challenges. As 

Secretary of Defense Mattis famously said, ‘‘When American diplomats don’t have the resources they need, our military needs to 

buy more ammunition.’’

I applaud the administration for their efforts to move toward a 

more fiscally responsible executive branch, but I am concerned that 

the symbolism of cuts have been given more importance than the 

actual value of individual programs. It is worth reiterating that 

even before this year’s foreign operations budget was slashed by 30 

percent, it accounted for just 1 percent of annual Federal outlay. 

Empty gestures are not the way to truly rein in our control, our 

out-of-control government spending, especially if they undermine 

U.S. interests. 

Business logic dictates that we should continue projects that deliver a good return on investment, yet I see many potentially sound 

investments that have been left out of this year’s request. For example, foreign military financing grants have been mostly stripped 

out of this year’s budget. In the Asia-Pacific theater, these grants 

have been used to advance U.S. national security, for example, by 

boosting our allies’ ability to counter China’s maritime aggression. 

Similarly, the United States has traditionally supported democratic reform, in part because working with friendly democracies is 

better for American peace, security, and influence, and it builds 

stronger relationships with our country. But this year’s request 

drops support for democracy and governance reforms for Cambodia, 

which is just 1 year away from an election that could help transform it away from an autocracy. 

Overall, the most worrying implication of this year’s EAP, Eastern Asia-Pacific, budget may be that it reflects a continuing misalignment of the administration’s strategic planning with the importance of Asia. Even during the so-called pivot to Asia, budgetary 

commitments to Asia were the smallest of any region. This year’s 

request would cut this by a further 46 percent, the largest percentage cut for any region other than Europe. 

This afternoon we discuss the details of this year’s state and foreign operations request for East Asia and the Pacific. We will try 

to strike a balance between fiscal responsibility and sound investments in our national security and other strategic priorities. In 

conducting our oversight of this request we will seek to advance 

the national interests by making sure that U.S. diplomatic engagement is up to the multitude of challenges and opportunities presented by this dynamic region. 

I thank the witnesses for joining us today to discuss this important topic. Without objection, the witnesses’ written statements will 

be entered into the hearing record. 

I now turn to our ranking member for any remarks he may have. 

[The opening statement of Mr. Yoho follows:]

3


26430c-1.eps

U.S. Interests in the Asia-Pacific: FY 2018 Budget Hearing 

Subcommittee on Asia and the Pacific 

House Committee on Foreign Affairs 

Thursday, July 27, 2017, 2:30p.m. 

Opening Statement of Chairman Ted Yoho 

Good afternoon. We call this hearing to order today pursuant to our Congressional oversight 

responsibilities to discuss the Administration's Fiscal Year 2018 State and Foreign Operations 

budget request for the East Asia and Pacific region. On behalf of the Subcommittee, I thank the 

panel for joining us today to share the insights and expertise they've gained over their lengthy 

diplomatic careers as we deliberate this important topic. 

East Asia and the Pacific represent the opportunities and challenges of this century like no other 

part of the world. Just over 30 percent of the world's population lives in this region. It accounts 

for the same share of global GDP, and continues to lead the world in annual GDP growth. Four 

of the top ten U.S. trading partners are located in this area. 

Five of the United States' seven collective defense arrangements are located in the Asia Pacitic, 

where over 63,000 U.S. troops are stationed. This region is home to what many believe to be our 

most urgent existential threat, the nuclear belligerence of North Korea. We also see rising 

Islamist militancy and major territorial disputes in the South China Sea, the East China Sea, and 

the Sea of Japan. About a third of the world's maritime trade passes through these disputed areas, 

as does most of the energy supply of South Korea, Japan, and Taiwan, all critical U.S security 

partners. And not least, this is the same area over which China, our chief global rival, seeks 

hegemony. 

The importance of East Asia to U.S. interests is beyond doubt. If the United States is to remain 

relevant as a global leader, we can't sit out the transformation happening among our neighbors 

across the Pacific. Our diplomatic engagement in the region should advance our interests in the 

opportunities of Asia, and should also be the first line of American defense amongst its many 

security challenges. As Secretary of Defense Mattis famously said, when American diplomats 

don't have the resources they need, our military needs 'to buy more ammunition.' 

I applaud the Administration for their e±l'orts to move towards a more tiscally responsible 

executive branch, but I'm concerned that the symbolic importance of cuts has been given more 

importance than the actual value of individual program. It's worth reiterating that, even before 

this year's foreign operations budget was slashed by 30 percent, it accounted for just I percent of 

annual federal outlay. Empty gestures are not the way to truly reign in out of control government 

spending, especially if they undennine U.S. interests. 

Business logic dictates that we should continue projects that deliver a good return on investment. 

Yet I see many potentially sound investments that have been left out of this year's request. For 
4


26430c-2.eps

example, Foreign Military Financing grants have been mostly stripped out of this year's budget. 

In the Asia Pacific theater, these grants have been used to advance U.S. national security, for 

example, by boosting our allies' ability to counter China's maritime aggression. 

Similarly, the United States has traditionally supported democratic reforms, in part because 

working with friendly democracies is better for American peace, security, and influence. But this 

year's request drops support for democracy and governance reforms for Cambodia, which is just 

one year away from an election that could help transform it away from autocracy. 

Overall, the most worrying implication of this year's EAP budget may be that it reflects a 

continuing misalignment of the Administration's strategic planning with the importance of Asia. 

Even during the so-called "Pivot to Asia", budgetary commitments for Asia were the smallest of 

any region. This year's request would cut this by a further 46 percent, the largest percentage cut 

for any region other than Europe. 

This afternoon, as we discuss the details of this year's State and Foreign Operations request for 

East Asia and the Pacific, we'll try to strike a balance between fiscal responsibility, and sound 

investments in our national security and other strategic priorities. In conducting our oversight of 

this request, we will seek to advance the national interest by making sure that US diplomatic 

engagement is up to the multitude of challenges and opportunities presented by this dynamic 

region. 

I thank the witnesses for joining us today to discuss this important topic. 
5

Mr. SHERMAN. Thank you, Mr. Chairman. 

We should discuss security, economics, democracy, and human 

rights. As to security, our security interests cover familiar and new 

terrain. We have alliances with Japan, South Korea, Australia, 

Thailand, the Philippines. We have security relations with New 

Zealand and Singapore, and are building partnerships with Vietnam, Malaysia, and Indonesia. Of course, we are dedicated to the 

security of Taiwan. These alliances and partnerships provide stability in the Asia-Pacific region and counter terrorism, piracy, and 

provide for humanitarian assistance in the wake of natural disasters. 

The huge proposed reduction in the Asia-Pacific diplomatic and 

aid budgets sends entirely the wrong message. If we do not reassure our partners of our commitment to the region, they’ll be inclined to go with China. It is especially absurd to have a system 

of slashing our aid and diplomacy and public policy outreach to the 

Asia-Pacific region while massively increasing our military, most of 

that going to the Asia-Pacific region. 

Let us talk about North Korea. We have got a huge threat. Assistant Secretary Thornton observed that North Korea has no intention of abandoning its nuclear program in the current environment. In two hearings this year I mentioned the possibility of moderating our objectives to achieve a freeze of their nuclear missile 

program together with in-person monitoring. North Korea is believed to have roughly 20 nuclear weapons, maybe producing three 

to seven a year, unless we are able to get a freeze. 

Now, of course, that does not meet American political needs for 

politicians and operatives here in Washington. You meet those political needs by pounding the table, saying that any North Korean 

nuclear weapons is completely unacceptable. We have been doing 

that for the last 17 years. People say it is a complete failure because within a year or two my city will be subject to North Korean 

nuclear weapons. But it is not a failure because it has met the political needs of the people who keep bleating the same slogans over 

and over again. 

So, if the objective is to reach a consensus in Washington, and 

all say the same things, and the policy is going well. If the, if a 

goal is to try to keep this country safe from North Korean ICBMs, 

then I suggest we make it clear to China that they cannot have access to U.S. markets unabated on the one hand, and continue their 

current policy toward North Korea on the other. Of course, a lot of 

money would be lost by a lot of big companies if we were to do that, 

or even threaten to do that, and so we won’t. We will continue to 

meet the political needs of Washington and the economic needs of 

Wall Street. 

Moving on to economics. We have got a $340 billion trade deficit 

with China; $69 billion with Japan; $83 billion with the Southeast 

Asian countries. It is about time that we do something about that. 

Access to the U.S. market should be dependent upon fair and balanced trade. 

As to human rights, we see that Laos, Cambodia, and Vietnam 

are not democratic. Democracy has regressed in Thailand. Indonesia, Malaysia, and the Philippines are democratic to a varying 

degree. Myanmar, also known as Burma, has made a transition 

6

from military rule to something that at least seems to be civilian 

government. 

Given the fundamental importance of democracy, human rights, 

and the rule of law why has our FY 2018 budget proposal slashed 

support for these efforts in Asia? We know that 121 three- and 

four-star military officers, retired military officers have said that if 

we slash our diplomatic and aid efforts this will undermine American security. That is why we need a budget that reflects our values. 

Instead, we are being told slash the diplomacy, slash the aid, 

slash the money for communication with the peoples, and somehow 

instead increase the military budget by $50 billion, $60 billion, $70 

billion, and pivot that military toward Asia. I suggest that that is 

a dangerous and shortsighted approach to budgeting. But budgeting is policy. 

And I yield back. 

Mr. YOHO. Thank you for those comments, and very direct. I will 

look forward to an engaging hearing here. 

We next go to Mr. Chabot of Ohio. 

Mr. CHABOT. Thank you, Mr. Chairman. Thank you for holding 

this important hearing this afternoon. 

There are just two topics I would like to comment, the first being 

Taiwan. As one of the, as I mentioned before, one of the co-founders 

of the Congressional Taiwan Caucus I have been interested in this 

issue for over 20 years now and involved in it. I remember when 

I first came to Congress back then, there were a couple hundred 

missiles aimed at Taiwan from across the Taiwan Straits from the 

PRC to Taiwan. That has gone from a couple hundred now to 1,600 

approximately. 

The PRC has been bullying Taiwan for years and years now. I 

would just say that we ought to be very clear that we are committed to the Taiwan Relations Act and the six assurances. Taiwan 

needs to beef up their military. The best way to avoid conflict is 

to be strong and not perceived as being weak. 

Very quickly on North Korea, you have got a madman there. We 

have had three administrations that have had the luxury of being 

able to enter into talks about the threat from North Korea. Essentially what would happen as a result of these talks we would end 

up giving them stuff—oil, food, other necessities—that they 

couldn’t provide themselves because everything they have goes to 

their military. That also freed up these things; because we are giving them food, they could give food to the military. 

So they would say they would back off from their nuclear program but they cheated every time. It was a luxury, I say, because 

they couldn’t, they couldn’t hit us. They could hit our allies. They 

could hit Japan, they could hit our military forces, but they 

couldn’t hit us. Now they can. There is only one thing that I think 

gets China’s attention, and that is if we seriously discuss a nuclear 

programs for South Korea and Japan. I think that is the only thing 

that will get China’s attention to get them to get North Korea to 

back off. 

I know two people have been saying this for years, myself and 

Charles Krauthammer, I don’t know which one of us said it first 

7

but I have been preaching it a long time, and I think that is the 

only thing that will work. 

I yield back. 

Mr. YOHO. I appreciate your comments. And, again, I think this 

is going to be very engaging. 

We next go to Mr. Connolly of Virginia. 

Mr. CONNOLLY. I yield my time to Mr. Bera. 

Mr. YOHO. Okay. Mr. Bera. 

Mr. BERA. Thank you, Mr. Chairman. Thank you, Ranking Member Sherman. 

You know, the countries in East Asia rely quite heavily on U.S. 

assistance for their national and regional security, particularly in 

Southeast Asia. But yet, when we look at the FY 2018 budget request, that is not reflected in here. In there, the rationale for this 

budget says to reinforce the rules-based order in the region by 

building an international commitment to defeat ISIS and defending 

freedom of navigation in the region’s maritime spaces, including 

the South China Sea, with U.S. leadership. 

But the budget request proposes eliminating foreign military financing altogether for the countries in Asia. U.S. foreign assistance 

to Indonesia is cut by 31 percent; 56 percent to the Philippines; 26 

percent to Vietnam. These cuts flatly contradict the administration’s statement of commitment to the region. 

It is my belief that the budget puts America and our standing 

in the region at risk. While administration officials have stated 

that we remain committed to Asia, our words have to be backed up 

by our deeds. This budget does not reflect that commitment. So, I 

really do worry that we jeopardize our relationships in Asia. 

Our support for our allies and partners in Asia increase global 

and regional stability. And better stability there means better security here at home. 

I yield back. 

Mr. YOHO. I appreciate my colleague’s remarks. 

We will next go to Mr. Connolly from Virginia. 

Mr. CONNOLLY. I thank my friend. 

I want to echo our chairman, Mr. Yoho’s, comments about the 

draconian nature of the budget cuts proposed. This isn’t a reduction, this is gutting. To cut almost half of the aid to an entire region, the biggest cut in the world outside of Europe and Eurasia, 

speaks volumes. You don’t make a country great through retreat; 

you make a country weak through retreat, and you hand over assets and dynamics to China in this region. That is the consequence. 

You cannot cut 46 percent and fight terrorism. You cannot cut 

all foreign military financing and fight terrorism. You cannot cut 

huge amounts of money from the Philippines and Indonesia when 

you are worried about ISIS-affiliated organizations suddenly resurfacing or surfacing in those countries. That is contradictory. It 

shows a complete lack of understanding of what we do through the 

foreign assistance program. And, Ms. Thornton, I hope you will 

take that message back. 

On one final point, Ms. Steele, I saw you went to Maryknoll College in the Philippines. I went to Maryknoll College in Chicago, Illinois. So you need a promotion. 

Mr. YOHO. The gentleman yields back. 

8

And with that we are thankful to be joined today by Ms. Susan 

Thornton, Acting Assistant Secretary for the Bureau of East Asian 

and Pacific Affairs at the U.S. Department of State; and Ms. Gloria 

Steele, Acting Assistant Administrator of the Bureau for Asia at 

the U.S. Agency for International Development. 

As our meetings in the past, what I encourage you to do is be 

engaging. These guys will be, this panel will be. It is the ideas that 

you give us here that will form policy to help bring some, hopefully, 

some diplomatic responses or actions so that we can have peaceful 

resolve of what is going on in the Asia-Pacific theater, whether it 

is North Korea with the threats of nuclear weapons, or the aggression of China further creating a hegemony in that area. 

So I appreciate it. Ms. Thornton, if you would go ahead and just 

for house cleaning make sure you turn your microphone on. You 

will have 5 minutes. We are going to ask members to respectfully 

try to stay to the 5-minute time limit. I can’t tell you how much 

I appreciate you being here and thank you. 

Ms. Thornton, go ahead. 

STATEMENT OF MS. SUSAN THORNTON, ACTING ASSISTANT 

SECRETARY, BUREAU OF EAST ASIAN AND PACIFIC AFFAIRS, U.S. DEPARTMENT OF STATE 

Ms. THORNTON. Thank you very much, Mr. Chairman. I am very 

happy to be here with you today to discuss the budget situation for 

FY 2018——

Mr. CONNOLLY. Excuse me, Mr. Chairman. Could I ask Ms. 

Thornton to pull the microphone closer to her so we can all hear? 

Mr. YOHO. Thank you. 

Ms. THORNTON. Is that better? Can you hear me now? Okay. 

Well, thank you again, Mr. Ranking Member, members of the 

subcommittee. Thank you for the opportunity to appear before you 

today to testify regarding the President’s fiscal year FY 2018 budget request for East Asia-Pacific. 

The Bureau of East Asian and Pacific Affairs is responsible for 

engaging a region that represents a quarter of the world’s population in GDP, some of the world’s fastest growing markets and, as 

you said, Mr. Chairman, four of our top ten trading partners. Despite all of its dynamism and promise, we do, however, face serious 

challenges to our security interests and we must address these to 

keep the United States, our allies, and our partners safe. 

The FY 2018 budget request supports the President’s vision to 

meet four key challenges: Addressing the North Korea threat, 

maintaining American leadership and influence in the East Asia 

region, defeating ISIS and combating transnational crime, and creating jobs and other economic opportunities for Americans. 

The most pressing threat that we face today, of course, is North 

Korea. The DPRK’s continued pursuit of nuclear weapons and the 

means to deliver them is not new, but the regime has accelerated 

its development of new capabilities over the past 2 years. To address this growing threat we are stepping up our global pressure 

campaign in coordination with allies and partners around the 

world to convince the DPRK regime to return to serious 

denuclearization talks. 

9

Maintaining American leadership in Asia requires us to work 

with our allies and partners on a range of challenges. Our budget 

request allows us to bolster Southeast Asian cooperation on maritime security and the rule of law which underpin regional security 

and economic stability. 

We support peaceful resolution of the contested maritime claims 

in the South China Sea. Destabilizing actions such as Chinese land 

reclamation, construction, and militarization of disputed features 

makes it harder for the region to resolve these disagreements 

peacefully. 

Effective public diplomacy is another key ingredient for American 

leadership in the region. We use educational, cultural, and digital 

exchange programs to communicate U.S. policy perspectives to foreign governments and influential members of their publics, including media, emerging leaders, thought leaders, legislators, and civil 

society across Asia. 

Our FY 2018 request requires improved efficiencies in U.S. public diplomacy that will enhance our ability to remain this dynamic 

region’s partner of choice on a wide range of shared challenges. 

Even as ISIS faces battlefield losses in the Middle East, the siege 

of Marawi City by an ISIS-affiliated group in the Southern Philippines demonstrates the group’s lingering appeal in Southeast 

Asia. 

Our FY 2018 EAP foreign assistance request includes resources 

to support efforts to defeat ISIS and to counter transnational 

crime—a funding source for ISIS, of course—across Southeast Asia. 

Our law enforcement and judicial sector programs have enhanced 

recipient countries’ capacities to identify, prosecute, and effectively 

isolate terrorists and other criminals. 

Regionally, our border security and information sharing programs prevent foreign terrorist fighter transit, trace illicit financing, and counter trafficking in goods and people. 

These programs help to ensure that Southeast Asia’s economic 

integration does not leave it more vulnerable to terrorism, cyber attacks, or other transnational crimes. 

Finally, the FY 2018 EAP foreign assistance request will support 

economic diplomacy to level the playing field and reduce trade barriers for U.S. businesses. Multi-lateral work with APEC and 

ASEAN will lead to truly free and fair trade with the region’s more 

than two dozen economies, while bilateral U.S. economic programs 

in Vietnam, Indonesia, the Philippines, and Burma will hopefully 

lay the groundwork for high quality, free and fair trade with these 

key partners. We will take the lead in setting and raising trade 

standards across the region, supported by the negotiation of bilateral trade agreements, as appropriate. 

Thank you for inviting me today to testify. And I look forward 

to your questions. 

[The prepared statement of Ms. Thornton follows:]

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26430a-1.eps

Statement of 

Susan Thornton 

Acting Assistant Secretary 

Bureau of East Asian and Pacific Affairs 

U.S. Department of State 

Before the 

House Foreign Affairs Committee 

Subcommittee on Asia and the Pacific 

July 27, 2017 

The FY 2018 Budget Request for the Bureau of East Asian and Pacific Affairs 

Chaimmn Yoho, Ranking Member Shennan, and Members of the Subconunittee: 

Thank you for the opportunity to appear before you today to testify regarding the 

President's Fiscal Year (FY) 2018 budget request for East Asia and the Pacific. 1 

would also like to thank the Subconunittee for its leadership in supporting and 

promoting engagement with the Asia-Pacific region and advancing U.S. interests. 

I am pleased to be joined by USAID Acting Assistant Administrator Gloria Steele. 

The Bureau of East Asian and Pacific Affairs ( EAP) is responsible for engaging a 

region that represents a quarter of the world's population and GDP, some ofthe 

world's fastest growing markets, and four of our top ten trading partners. Despite 

all of its dynamism and promise, we also face serious challenges, the most urgent 

being the threat of North Korea's nuclear and missile programs. ln addition, as 

China's influence and ambitions grow in the region, there is increasing concem 

about how this will affect the rules-based order that has served the region so well 

over the past decades. And as we have seen in the southem Philippines, ISIS is 

seeking to spread violence and its hateful ideology in Southeast Asia. 

The high level of U.S. engagement in the region early in the Trump Administration 

sent a clear signal that Asia remains a top priority. Vice President Pence, 

Secretaries Tillerson and Mattis, and USTR Lighthizer all traveled to Asia within 

the first four months of the Administration. Vice President Pence visited key 

partners and allies- Australia, South Korea, and Japan, as well as Indonesia, where 

he also engaged representatives to all ten A SEAN countries- and there have been 

many meetings at the highest levels of government, including summits with the 

leaders ofJapan, South Korea, China, and Vietnam, among others. The President 

invited leaders of Thailand, the Philippines, and Singapore to Washington. 
11


26430a-2.eps

We expect this pace to continue this year, with the Secretary returning to Asia for 

the Association of Southeast Asian Nations (ASEAN) Regional Fonun and the 

Asia-Pacitic Economic Cooperation (APEC) Ministers Meeting, and USTR 

Lighthizer to attend the ASEAN Trade Ministers Meeting. The earliest-ever 

announcement that the President will travel to Asia for summits this November 

sends a clear signal of the importance we attach to U.S. economic and security 

engagement in the Asia-Pacific Region. 

The President's FY 2018 budget request of$717 million for East Asia and the 

Pacific will allow us to project a strong U.S. presence in the region. The overall 

request includes $393 million in foreign assistance and $324 million for diplomatic 

engagement. 

The budget request supports the President's priorities to defend national security, 

assert U.S. leadership, foster opporttmities tor U.S. economic interests, promote 

respect tor human rights, and ensure accountability to the U.S. taxpayer. The 

request acknowledges that our operations must become more efficient and our 

assistance more effective. 

Government assistance alone cannot resolve complex challenges, nor can the 

United States do so alone. We expect aid recipients to make better use of their 

own investments tor development, and partner donor countries to do more to 

support peace and prosperity in the Asia-Pacific region. 

We had to make some tough tradeoffs. But by focusing our et1orts on our most 

important policy goals and national security and economic interests, we aim to 

maximize our use of taxpayer dollars. 

Policy Priorities 

The FY 2018 budget request enables EAP to advance four key priorities: 

addressing the North Korea threat; maintaining leadership and influence in the 

region; defeating ISIS and combatting transnational crime; and creating jobs and 

economic opportunities for Americans. 

North Korea 

The most urgent and dangerous threat is North Korea. Its continued pursuit of 

nuclear weapons and the means to deliver them is not new. The regime, however, 

has been demonstrating new capabilities over the past two years at a quicker pace 

than it has ever done betore. We are stepping up our pressure campaign to address 

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this growing threat. It starts with our allies. We are increasing our trilateral 

security cooperation with Japan and South Korea. With them and others, we are 

working to isolate and increase pressure on North Korea with the goal of 

convincing the regime to return to serious talks aimed at denuclearization. This 

has been and remains this Administration's top diplomatic priority. 

Addressing North Korea's egregious human tights record is also important. This 

budget request will enable us to support programs that promote the flow of 

independent information into and out of the closed country, including through 

broadcasting. 

Engagement and Influence 

The budget request promotes continued work with our allies and partners to bolster 

Southeast Asian security cooperation, maritime security, and the rule oflaw, which 

are important to regional security and economic stability. We will support the 

ongoing development of regional institutions such as ASEAN, EAS, APEC, and 

the Lower Mekong Initiative to engage with our partners and uphold the rulesbased order. 

The United States has supported ASEAN's central role in the evolving regional 

architecture. The FY 2018 request supports platforms for dialogue that advance 

regional economic and political integration, security cooperation, democracy, 

human rights, labor rights, and humanitarian relief. 

Contested maritime claims in Southeast Asia and destabilizing actions such as 

Chinese land reclamation, construction, and militarization of disputed features in 

the South China Sea make it harder for the region to resolve disagreements 

peacefully. We continue to work with regional partners and allies to build their 

capacity to maintain free and open access to their seas through enhanced maritime 

security capabilities and maritime domain awareness. We seek to complement the 

Department of Defense's Maritime Security Initiative (MSl) and security 

cooperation programs under Section 333 with grants or loans from the global 

Foreign Military Financing (FMF) fund. FMF is used to provide defense articles 

and augment capabilities, whereas MST is better able to maintain and support 

existing articles. The two are not interchangeable, but complement each other. 

The United States remains committed to the promotion of democracy and the 

protection of human rights, including the rights of women, children, and minority 

commtmities to foster responsible Asia-Pacific partners that share America's 

fundamental values. Our $63 million request for Burma supports the country's 

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ongoing transition towards democracy, including support for political, economic, 

and hmnan rights reforms. A successful transition would promote stability in the 

region and ensure Burma continues to develop as a key democratic and economic 

partner of the United States. 

As China and other countries armmd the region increase restrictions on civil 

society and human rights defenders, it is critically important we continue to 

support human tights and democracy. The recent death of Chinese Nobel Peace 

Prize laureate Liu Xiaobo while in custody is a tragic reminder of the datmting 

repression facing democracy and human rights advocates in China and in some 

parts of the region. The United States' support for human rights and democracy 

promotion has been and will remain a key pillar of our strategy. 

The budget also provides up to $38 million for critical War Legacy programs. 

These efforts engender goodwill among local populations and are essential for 

maintaining U.S. int1uence in the Mekong Region. They also provide a platform 

that allows us to broaden other aspects of our bilateral relationship with these 

countries. 

Defeating ISIS and Countering Transnational Crime 

The siege ofMarawi City by ISIS-affiliated groups in the southern Philippines 

demonstrates the group's appeal to home-grown extremists in Southeast Asia, even 

as ISIS faces battlefield losses in the Middle East. 

The FY 2018 EAP foreign assistance request support efforts to defeat TSTS and 

counter transnational crime - a ftmding source for ISIS - in Southeast Asia. 

Our law enforcement and judicial sector programs have resulted in significant 

gains in recipient cmmtries' capacities to identity, prosecute, and effectively isolate 

terrorists and other criminals. We are supporting critical police investigation and 

crisis response skills that helped units respond to bombing attempts in Malaysia 

and the Philippines. 

Regionally, our border security and infom1ation sharing programs will continue to 

assist countries prevent foreign terrorist fighter transit, trace illicit financing, and 

counter trafticking in goods and people. These programs help to ensure that 

Southeast Asia's economic integration does not leave it more vulnerable to 

terrorism, cyber attacks, or other transnational crimes. 

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We will also continue efforts to disrupt ISIS recruitment in the region, including 

sustaining assistance in the Philippines to provide job training opportunities for at 

risk youth in the southern Philippines and addressing radicalization in tmiversities 

across the region. The request provides $23 million for efforts to combat violent 

extremism. 

Development programs in Southeast Asia will also continue efforts to eliminate 

corruption and promote fundamental freedoms, in addition to providing viable 

economic opporttmities. These programs address vulnerabilities to make it more 

difficult for ISIS and other violent extremist groups to recruit and operate. 

Economic Opportunity 

With respect to advancing economic opportunity for the United States, the FY 

2018 EAP foreign assistance request supports economic growth programs that 

level the playing field for U.S. businesses and reduce trade barriers. 

Our use of foreign assistance through APEC and ASEAN is important as it 

provides economies of scale in shaping the policy envirom11ent tor fair trade with 

the region's more than two dozen economies- helping to promote higher standards 

across the region, including countries with which we may pursue bilateral trade 

agreements. 

We are working to raise standards for trade and investment through APEC, the key 

forum for advancing our economic priorities with economies in the Asia Pacific. 

Our engagement with APEC allows us to advocate the standards and practices that 

bolster American competitiveness and prosperity in a market of three billion 

consumers that makes up more than 60 percent of world GDP, and includes nine of 

our top 15 export markets. 

The FY 2018 request includes funding for APEC programs that expand trade and 

investment in the region, reduce barriers to business in the region by advancing 

good governance and transparency, and seek to broaden economic participation 

and promote sustainable growth. Through ASEAN, we are building capacity to 

establish appropriate "light-touch," harmonized regulations that will enable U.S. 

companies to compete on a level playing field across all ten ASEAN member 

states. 

We will continue bilateral U.S. economic programs in Vietnam, Indonesia, the 

Philippines, and Burma, which lay the groundwork tor high quality, fair, and 

reciprocal trade. 

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Diplomatic Engagement 

In addition to foreign assistance, the FY 2018 request requires improved 

efficiencies in public diplomacy programming. 

U.S. public diplomacy advances U.S. foreign policy objectives by informing and 

influencing foreign governments and influential members of their publics, 

including media, emerging leaders, jurists, thought leaders, legislators, and civil 

society. U.S. public diplomacy in EAP will continue to support our highest foreign 

policy objectives related to North Korea, a rules-based order in Southeast Asia, and 

destroying ISIS. 

At the same time, there is more competition. We see dramatic jumps in public 

diplomacy progran1s from China, including its expansion of exchange progran1s 

and academic scholarships for leaders and students from Southeast Asia and the 

Pacific Islands. We use public diplomacy to project America's commitment to the 

region and push back against negative narratives about U.S. actions. In the end, 

we aim to be the region's partner of choice by using educational, cultural, and 

digital exchange programs to promote U.S. security and economic interests. 

EAP's public diplomacy budget is roughly split between public diplomacy funds 

and appropriations to the Bureau of Educational and Cultural Exchanges that are 

used for international and educational exchanges. We will focus on what works 

best, including robust exchanges such as the Fulbright Program, the International 

Visitors Leadership Program, and the Young Southeast Asian Leaders Initiative. 

Our media programs focus on priority U.S. interests in Asia, for example, by 

informing Asians about North Korea and the stakes in the South China Sea. 

Conclusion 

Mr. Chairman and Members ofthe Subcommittee, the Department of State is 

making significant progress toward ensuring that the Asia-Pacific continues to be a 

peaceful, prosperous, and economically dynamic region. We urge your support for 

the FY 2018 budget request and look forward to working with you and other 

Members of Congress to continue to build on our accomplishments in the region. 

Thank you for inviting me to testify today. I am pleased to answer any questions 

you may have. 

6 
16

Mr. YOHO. Ms. Thornton, thank you. 

And, Ms. Steele, if you would go ahead. And don’t forget to push 

the red button. Thank you, ma’am. 

STATEMENT OF MS. GLORIA STEELE, ACTING ASSISTANT ADMINISTRATOR, BUREAU FOR ASIA, U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT 

Ms. STEELE. Chairman Yoho, Ranking Member Sherman, distinguished subcommittee members, thank you very much for inviting 

me to testify today to talk about USAID’s role in advancing U.S. 

foreign policy priorities in East Asia and the Pacific Islands. 

Asia-Pacific economies are deeply intertwined with our own. Asia 

is a leading destination for American exports, which support some 

3.4 million jobs here in the U.S. By 2030 Asia will become home 

to more than half of the world’s consumer class. Asia’s growing 

market potential presents tremendous opportunities to create U.S. 

jobs and support regional and global prosperity. However, complex 

development challenges threaten to derail this trajectory. 

Asia’s income inequality gap has drastically widened over the 

past two decades. Asian countries are under pressure to provide essential services on an unprecedented scale. And, as mentioned earlier, ISIS is increasing local attacks and recruiting foreign fighters. 

A host of other development challenges hold the region back, ranging from pandemic threats to human trafficking. 

The President’s fiscal year 2018 budget request for USAID’s foreign assistance in this region is approximately $235 million. This 

request will enable USAID to continue its vital role in addressing 

key development challenges in the region while strengthening our 

national security, advancing U.S. economic interests, and asserting 

U.S. global leadership and influence. 

On national security, USAID helps to counter threats to the U.S. 

before they mature, then keep a focus on preventing radicalization 

to violence by addressing its underlying drivers. It also includes 

leading regional efforts to combat human and wildlife trafficking. 

It includes working to prevent health threats from reaching our 

country by addressing them abroad. 

We help to reduce non-tariff trade barriers, protect intellectual 

property rights, and support the emergence of a consumer class 

that can buy American goods and services. We also support ASEAN 

and APEC in achieving these objectives. 

We are leading the world in improving global health, particularly 

maternal and child health, malaria, and tuberculosis. We are also 

demonstrating leadership that reflects our core American values 

through lifesaving humanitarian assistance. 

Next I would like to provide a brief overview of our programs in 

key countries. 

Indonesia. Indonesia shares our concern about evolving threats 

from extremists. In response, we are reorienting our programs and 

designing new ones. Our focus is on strengthening moderate voices, 

bolstering community resilience to radicalization, and developing 

the capacity of Indonesian institutions to break the link between 

corruption and extremism. We are also improving access to justice 

for marginalized communities. 

17

Our work in Indonesia strengthens democratic governance and 

improves market access for American businesses, including Indonesia’s $16 billion renewable energy market. Our efforts also include reducing maternal and child deaths and strengthening Indonesia’s ability to contain infectious diseases. 

In the Philippines, where I grew up, the budget request supports 

programs to counter violent extremism, foster inclusive growth, 

and control tuberculosis. USAID is intensifying ongoing programs 

to address the threat of ISIS in Mindanao. In addition, we are 

helping citizens engage with government and bolster economic opportunities, especially among the youth. We will intensify our efforts to improve the court system’s efficiency in order to strengthen 

the rule of law. 

The request supports our continued partnership with the Philippines to stimulate inclusive economic growth. USAID has helped 

advance reforms that benefit the Philippines, as well as the U.S., 

including liberalizing foreign investment laws, establishing an antitrust body, and modernizing customs procedures. 

The Philippine budget also includes assistance that we provide to 

the Pacific Island countries, 12 of them. And they are focused on 

disaster preparedness. 

In Burma, USAID will continue efforts to foster national peace 

and reconciliation, and maintain the momentum for democratic and 

economic reforms, as well as improve the lives of the people of 

Burma. We will continue to respond to humanitarian needs of vulnerable populations, including the Rohingya, and will continue 

working toward a solution to violence in Rakhine. 

In Vietnam, our assistance focuses on strengthening the U.S.-

Vietnam partnership. We are also helping to level the playing field 

for U.S. businesses in Vietnam by helping it to become more market-oriented and committed to good government. 

And, finally, in Cambodia we have helped to significantly drive 

down malaria, TB, infant and child mortality. The budget request 

supports our efforts to build on these gains. 

We have a regional program that is based in Bangkok which will 

focus on activities that combat human and wildlife trafficking, and 

illegal and unregulated fishing. 

Mr. Chairman and committee, investing in development in the 

East Asia-Pacific is not only good for our allies and friends in Asia, 

but it remains in our national interest. In helping build more stable, open, and prosperous societies overseas we enhance our own 

prosperity and strengthen our security. 

Thank you. And I look forward to your counsel and questions. 

[The prepared statement of Ms. Steele follows:]

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Statement of Gloria Steele 

Acting Assistant Administrator, Bureau for Asia 

United States Agency for International Development 

Before the House Committee on Foreign Mfairs, Subcommittee on Asia and the Pacific 

"U.S. Interests in the A.sia-Pac~{ic: FY 2018 Budget Hearing" 

Thursday, July 27, 2017 

Chairman Yoho, Ranking Member Sherman, and Distinguished Members of the Subcommittee: 

Thank you for inviting me to testify on the vital role of the United States Agency for 

International Development (USAID) in advancing U.S. foreign policy priorities in East Asia and 

the Pacific Islands. It is an honor to testify before this committee, and a pleasure to be here 

alongside my colleague from the U.S. Department of State, Acting Assistant Secretary 

Susan Thornton. 

Development plays an indispensable role, alongside diplomacy and defense, in advancing U.S. 

national security and economic interests. With less than I percent of the fiscal year (FY) 2018 

discretionary budget request, USAID's programs help reduce poverty and promote economic 

growth, strengthen democratic institutions, and avert crises worldwide. Our efforts bolster selfreliance in developing countries, which helps them forge sustainable paths of progress that 

benefit us all by building stronger trade and security partners and a more peaceful world. 

When it comes to Asia, a region of the world whose security and economies are intimately 

intertwined with our own, the region's success directly impacts U.S. national security and 

economic interests. As the most populous, fastest-growing region in the world, Asia is one of the 

main drivers of the global economy and is hugely consequential to our own future. Asia is a 

leading destination for U.S. exports, which support some 3.4 million U.S. jobs. Vietnam is the 

fastest-growing market for US exports in the entire world. By 2030, Asia will be home to more 

than half the world's consumer class and account for more than 40 percent of global GOP. Half 

of the next billion people added to the world will be in Asia. Asia's untapped, and growing, 

market potential presents tremendous opportunity to create U.S. jobs and support regional and 

global prosperity. 

Yet, with rapid growth comes complex development challenges that threaten to derail this 

success story. Never before in USAID's history has Asia accounted for such a large share of 

global wealth-and global extreme poverty. While Asia has enjoyed strong economic growth, 

that growth has largely not been inclusive. The income inequality gap has drastically widened 

over the past two decades, leaving about 240 million people in poverty, according to the Asian 

Development Bank. Asia is now home to nearly half of the world's extreme poor, more than half 

of all yearly deaths of newborn babies, and more than two-thirds of the world's undernourished 

children. Asia is also plagued by more than half of all natural disasters. The countries of Asia are 

under pressure to provide food, water, energy, health care, education, and jobs on a scale never 

before seen, outpacing the ability of governments to meet their people's needs. Over the next 15 
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years, electricity demand will triple in the Lower Mekong countries (Burma, Cambodia, Laos, 

Thailand, and Vietnam) alone. As evidenced by recent events in the Philippines, the Islamic 

State of Iraq and Syria (ISIS) is seeking to increase its influence and territory in the region after 

having attracted hundreds of foreign terrorist fighters. A host of other development challenges 

hold the region back, from emerging pandemic threats that undermine global health security and 

disrupt economic productivity, to widespread human trafficking that breaks down the rule of law 

and corrupts global commerce. 

USAID plays an important role in partnering with the countries of Asia. This engagement is key 

because the development decisions they make today will help realize the region's long-term 

success-success that is critical to our own security and prosperity. The President's FY 2018 

budget request for Department of State and USAID-managed assistance in the East Asia-Pacific 

region is $393 million. This request directs foreign assistance investments to approaches that 

have the most impact and are the most cost-effective in advancing U.S. national security 

objectives, while fostering economic opportunities for the American people and asserting U.S. 

leadership. 

First, this budget request enables USAID to continue its vital role in strengthening U.S. national 

security. USATD helps counter threats to the homeland before they mature-whether violent 

extremism, transnational crime, or pandemics. We are focused on preventing radicalization to 

violence by ISIS and other terrorist organizations by addressing the underlying drivers of violent 

extremism, and building strong economic and political foundations that adhere to the rules-based 

international order, thereby advancing our national interests. In the Philippines, USATD is 

intensifying ongoing programs to address drivers of radicalization to violence, disrupt ISIS 

recruitment, and erode support for ISIS. In Indonesia, we are starting this work through adapting 

our existing programs and designing new programs to prevent radicalization to violence and 

support for violent extremism. We are leading regional efforts to combat human and wildlife 

trafficking, a lucrative source of funding for criminal and terrorist networks. We are also 

working to prevent health threats from reaching our country by addressing them abroad. 

Second, this budget request enables USATD to continue its vital role in advancing US economic 

interests. USAID fosters the elimination ofnon-tarifftrade barriers and supports the emergence 

of a consumer class that can buy American goods and services. USAID encourages a level 

playing field for U.S. businesses by promoting international norms that enjoin others to follow 

international rules. We help to drive policy reforms that protect intellectual property and foster 

regulatory transparency-persistent areas of weakness in Asia. We also help strengthen regional 

bodies such as the Asia-Pacific Economic Cooperation (APEC) forum and the Association of 

Southeast Asian Nations (ASEAN) to achieve these objectives, at the same time that we work 

bilaterally with partner governments. 

In Vietnam, for example, we have achieved tremendous success in improving the business 

enabling environment through a ratings system initiated by US AID and the Vietnam Chamber of 

Commerce and Industry that motivates provinces to outdo each other in welcoming investment. 

Vietnam is now helping 10 other countries replicate the system. In the Philippines, USATD's 

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work through the U.S.-Philippines Partnership for Growth with Equity has helped 

advance meaningful reforms that are fostering an environment that is more enabling for U.S. 

businesses, including the Customs and Tariff Modernization Act, which benefits American 

exports to the Philippines through streamlined procedures in cargo clearances, and the Philippine 

Competition Act, which regulates anti-competitive behavior and promotes a better environment 

for the entrance of new market players. The United States is now the Philippines' second largest 

trading partner and U.S. exports to the Philippines totaled $8.2 billion in 2016. 

Third, this budget request enables USAlD to continue asserting U.S. leadership and influence in 

the region We are leading the world on improving global health, with a focus on maternal and 

child health, HlV/AlDS through our PEPFAR-supported efforts, and the fight to control malaria 

and tuberculosis (TB). ln Cambodia, USAlD investments have yielded high returns, driving 

down infant mortality and malaria so much that US AID is now helping Cambodia take steps 

toward the elimination of malaria-a feat unthinkable just a decade ago. Across Asia, we are 

demonstrating leadership that reflects our core American values through life-saving humanitarian 

assistance when and where it is needed most. We also play a critical role in preventing 

humanitarian crises and other security threats from metastasizing in the first place, including by 

addressing and reversing the root causes of instability and irregular migration, such as poor 

governance, corruption, poverty, weak institutions, and human rights abuses. Our ongoing work 

to build responsive local governance continues in FY 2018 in Burma, Indonesia, the Philippines, 

and Vietnam. 

Next, I will provide a brief country-by-country overview of the FY 2018 budget request. 

Indonesia 

We seek to expand our partnership with Indonesia, the world's largest Muslim-majority country 

and a G-20 member economy. US AID programs advance the core tenets of democracy, 

expanding tolerance and mitigating conflict over territory, religion, and resources. We are 

designing new programs to strengthen moderate voices in opposing violent extremist rhetoric, 

bolster social resilience, and help enhance Indonesian institutions. USA !D's regional work 

supports policies to reduce barriers faced by American businesses and position the United States 

as the preferred economic partner in the region. Moreover, USA !D's mission in Indonesia 

operates at the regional level to strengthen the institutions of ASEAN for good governance and 

economic integration. 

Indonesia shares our concern about the evolving threats from returning foreign terrorist fighters. 

USAID is reorienting existing programs and designing new programs to address drivers of 

radicalization to violence, disrupt ISIS recruitment, and erode support for ISIS. Prevention 

activities will include assisting the justice sector in identifying linkages between corruption and 

violent extremism, countering messages of violent extremism in media and civil society, and 

piloting knowledge exchange visits for officials of Indonesia and other Asian countries. Our 

democracy and governance programming will complement these efforts by strengthening 

governmental and civil society institutions and community leaders on the frontline in countering 

violent extremist recruitment and upholding justice and rule of law. Interventions will include 

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raising awareness-especially among law enforcement and the justice sector-offunding flows 

to violent extremist groups; countering the trend of violent extremists infiltrating schools, 

universities, and workplaces; and building the resilience of migrant workers against violent 

extremist recruitment. The budget request also supports research into the enabling role of 

corruption, analysis of radicalization trends at the subnationallevel, and comparative analysis of 

interventions by Indonesia and other Asian countries as part of South-South cooperation. These 

bilateral efforts are complemented by regional programming that promotes the rule oflaw, youth 

engagement, and human rights in ASEAN institutions. 

Our regional A SEAN efforts promote the development of an Indonesian market that is friendlier 

to U.S. businesses and investment. For example, we are helping to strengthen the policy and 

regulatory environment for Indonesia's renewable energy market-a potential $16 billion a year 

opportunity. American companies have a comparative advantage in providing high-quality, indemand renewable energy technologies, and expertise. USAID will further support work to 

improve the business enabling environment for U.S. companies in Indonesia and throughout 

A SEAN by encouraging policies to reduce barriers to market entry, streamline regulatory 

requirements, and combat corrupt business practices. 

Other efforts include: helping the world's major tuna exporter sustainably manage its fisheries; 

reducing maternal and child deaths; strengthening Indonesia's ability to better address its 

infectious disease threats by engaging U.S. companies like Cepheid and Johnson & Johnson; 

leveraging private sector support to help Indonesia achieve universal and equitable access to safe 

drinking water and safely managed sanitation services; as well as helping Indonesia strengthen 

its education system and provide opportunities for Indonesians to break out of the cycle of 

extreme poverty. 

Philippines 

The United States partners with the Philippines, our treaty ally, to promote regional security and 

economic prosperity. U.S. assistance supports mutual objectives to improve internal and external 

peace and stability, foster conditions for sustainable and inclusive economic growth, strengthen 

democratic processes, and increase transparency and respect for the rule of law and human 

rights. The budget request supports programs to counter violent extremism and trafficking in 

persons, reduce trade barriers, control TB, and strengthen environmental resilience. 

The growing influence of ISIS is alarming in the southern region of Mindanao, where 

ungoverned areas and deep-seated grievances against the national government are exploited. In a 

significant shift, some local terrorist organizations have banded together, burying their 

differences in a unified call to action on behalf of the Islamic State. US AID programs help to 

alleviate poverty in Mindanao, which, in many areas, exceeds 70 percent. We are helping to 

improve access to better-quality health and education services in this region, and we are assisting 

the government with mobilizing domestic resources for infrastructure development. Furthermore, 

USATD is stepping up actions to address drivers of radicalization to violence, disrupt TSTS 

recruitment, and erode support for ISIS. In the most vulnerable parts of Mindanao, USAID is 

helping resolve non-violent disputes, engage citizens with their local governments to engender 

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mutual trust and improve service delivery, and bolster economic opportunities, especially among 

youth. Early-grade reading programs will similarly focus on Mindanao and other at-risk areas, 

while higher education funds will help university students at risk of terrorist recruitment develop 

a sense of belonging and gain meaningful employment. To advance the rule oflaw and protect 

human rights, assistance will intensify reform efforts to improve the efficiency of the court 

system. 

The budget request enables USAID to continue working with the Philippines to stimulate 

inclusive economic growth and reduce barriers to trade. Through the Partnership for Growth with 

Equity, the U.S. and the Philippines have achieved success in supporting work to address the 

constraints to growth in the Philippines. This includes helping to promote substantial policy 

reforrn, including liberalizing foreign investment laws, establishing an antitrust body, and 

strengthening business contract enforcement by bolstering the capacity of the National Center for 

Mediation to adjudicate business disputes. American companies, such as GN Power and Applied 

Energy Services, received contracts worth more than $3 billion as a result of USA !D's support 

for more transparent and competitively-procured power supply agreements in the Philippines. 

Our programs support cities outside of the capital region-including three in Mindanao-to help 

spur economic growth outside of metropolitan Manila, which currently accounts for over 60 

percent of growth generated in the Philippines. Assistance will also help the Philippine 

government mobilize domestic resources through stronger systems to collect taxes and manage 

expenditures. 

USATD helps to strengthen the country's capability to prevent and control infectious diseases, 

particularly TB. Our partnership with California-based Cepheid is radically changing this fight 

through deployment of the company's rapid testing machines, which reduce the wait time for a 

diagnosis from weeks to hours. Impressed by the effectiveness of the technology, Philippine 

authorities procured 2,600 machines valued at $20 million. US AID programs will also make 

fisheries more resilient to environmental degradation, reduce the risks of disasters, increase 

energy investment opportunities for U.S. companies, and make seafood safer. The request for the 

Philippines includes support to Pacific Island countries to strengthen their disaster preparedness, 

which lowers the cost of disaster response. 

Burma 

In Burrna, our efforts focus on supporting Burma's transition toward democracy. The United 

States has an opportunity to help Burma demonstrate that democracy provides valuable 

economic and social dividends. To sustain the gains brought about by the 2015 elections, US AID 

will continue efforts to foster national reconciliation and peace to end ethnic conflict, maintain 

momentum for democratic and economic reforrns, and improve the lives of the people ofBurrna 

by increasing their access to better health services, economic opportunities, and life-saving 

humanitarian assistance where needed most. We will continue to respond to the humanitarian 

needs of vulnerable populations throughout Burma, including the Rohingya, and will continue 

working toward a solution to the human rights violations and violence in Rakhine. 

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USAID is assisting Bunna with modernizing and strengthening its civilian institutions to 

improve governance and increase trade and investment. Our efforts, which include strengthening 

both parliament and the judiciary, have improved the capacity of justice sector institutions to 

implement standards of due process in the legal system. We are helping to implement a modern 

and transparent commercial environment, including intellectual property rights protection, which 

will directly benefit U.S. finns doing business in Bunna. In partnership with Bunna's Ministry 

of Commerce, USAID established the country's first online trade portal, which fosters 

transparency on trade rules and regulations, making it easier for even the smallest U.S. 

businesses to enter Burma. We have also provided technical assistance on economic refonns and 

liberalization in foreign investment, finance, land use, and food safety. 

To complement commercial refonns and help reduce poverty, USAID is working with fanners to 

increase incomes, reduce malnutrition, and connect them to American expertise and equipment 

that helps maximize high-value crop yields. About 70 percent of the rural population lives on an 

agricultural income of some kind, so our assistance to smallholder fanners can be transformative 

in the lives of average Bunnese citizens and help reinforce the gains of the democratic transition. 

Vietnam 

Our assistance focuses on strengthening the U.S.-Vietnam diplomatic and economic partnership 

and helping Vietnam become more globally integrated, market-oriented and committed to good 

governance-which will help level the playing field for U.S. businesses. Addressing legacies of 

the Vietnam War is one of the means by which USAID strengthens U.S. ties with Vietnam and 

promotes goodwill between our peoples, enabling the U.S.-Vietnam partnership to move forward 

in other areas. Specifically, USAID has nearly completed remediation of Agent Orange and its 

byproduct, dioxin, at the Danang airport. 

Tn recent decades, Vietnam has made the transition from an agricultural, relatively isolated 

command economy to an emerging, market-driven economy. Assuming strong GOP growth 

continues, Vietnam's consumer class is anticipated to double between 2014 and 2020 to 33 

million people. Yet there are formidable hurdles ahead in achieving sustained and equitable 

growth, including Vietnam's weak and non-transparent legal and regulatory framework, which 

we are helping to address. Already, we have helped Vietnam rewrite over 160 laws and 

regulations affecting commercial activities and related judicial procedures, including the Civil 

Code, sale of real estate and dispute resolution, customs and tax procedures, and import/export 

regulations and trade fraud. Vietnam has improved in its "ease of doing business" ranking in the 

World Bank's annual Doing Business report, moving from 90th in the 2016 publication to 82nd 

in its 2017 edition. USAID also provides assistance to people with disabilities, and is supporting 

the Government of Vietnam in building a system to provide rehabilitation and direct services to 

persons with disabilities. 

Cambodia 

Tn Cambodia, USATD helps reduce poverty and strengthen Cambodia's economy and society by 

improving health services for vulnerable populations. We are working to combat malaria, HIV 

through our PEPFAR-supported efforts, maternal and child deaths, and TB. While the number of 

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malaria cases was almost halved between 2004 and 2014, the Cambodia-Thailand border 

remains an epicenter of drug-resistant malaria. USAID is strengthening the control, prevention, 

and surveillance of drug-resistant malaria. With our support, the Cambodia National Malaria 

Program has intensified malaria prevention and case management for high-risk populations. The 

program is also piloting an intervention near the border with Thailand that aims to accelerate 

elimination of malaria and drug-resistant parasites. Through our work under PEPFAR on 

HIV/AIDS, Cambodia is projected to be one of the first PEPFAR countries in Asia to achieve 

epidemic control and virtually eliminate new HIV infections by 2025, thereby greatly reducing a 

potent global health threat in this country. 

Since 2005, US AID investments have helped drive down child mortality by 50 percent and 

maternal mortality by more than 60 percent. We assisted Cambodia in further reducing 

preventable maternal and child deaths by providing coaching and training to frontline health care 

providers. Our assistance has helped ensure access for 3 million poor Cambodians to highquality health services, and developed the host government governance structure to manage and 

assume full fiscal responsibility by 2020 for sustaining and expanding this access. US AID is also 

helping Cambodia's national TB program more effectively stem the infectious disease. U.S. 

assistance has helped reduce the number of Cambodians dying from and living with TB by more 

than half. 

Regional Development Mission for Asia (RDMA) 

The budget request supports USAID regional activities that combat human and wildlife 

trafficking and illegal, unreported, and unregulated fishing. USATD counters human trafficking 

by reducing risk factors, protecting and assisting survivors, increasing prosecutions of traffickers, 

and strengthening the implementation of related laws and policies. USATD recently launched a 

new initiative tailored to the challenges and opportunities of the region to combat this estimated 

$12 billion per year industry. US AID is also at the forefront of combatting illegal, unreported, 

and unregulated fishing in the region-an activity with serious ecological, political, and 

economic impacts that may also have negative effects on the enjoyment of human rights, and 

which is contributing to the unsustainable harvest of fisheries, which may have the effect of 

fomenting instability in Southeast Asia. USATD complements these efforts by strengthening 

regional integration and cooperation between mainland Southeast Asian countries on critical 

transboundary issues through the Lower Mekong Initiative. 

Conclusion 

Mr. Chairman: Investing in global development progress is in the U.S. national interest. In 

helping build more stable, open, and prosperous societies, we build stronger security and 

economic partners for the United States, while reducing the need to put our men and women in 

uniform in harm's way. With the FY 2018 budget request, USAID will continue achieving 

results in the East Asia-Pacific region through strong American leadership. 

Thank you for the opportunity to appear before you today. I look forward to your counsel and 

questions. 

7 
25

Mr. YOHO. Thank you both for your great testimony. We will look 

forward to talking with you. 

Ms. Thornton, you were talking about North Korea is probably 

the most urgent thing. I think we are all in agreement. I think we 

are all in agreement that the expansion and the aggression of what 

we see with China in the South China Sea, declaring the South 

China Sea as sovereign, building islands initially as peaceful navigational purposes that have morphed into militarized islands with 

weapon systems on there, radar systems, landing strips. So, the 

rhetoric doesn’t match the actions. 

And we have seen this over and over again. If we can go back 

to the agreement between Great Britain and Hong Kong when they 

made the agreement and passed the control of that back, there was 

a 50-year plan. In that 50-year plan there was supposed to be freedom of speech, democracy, and all those things were supposed to 

be left in place. Yet, here we are 20 years and we see it is not true. 

So we have kind of seen this story over and over again. And, you 

know, with us cutting the budgets at State to save money—and we 

do, we need to be fiscally responsible because we have our own tsunami coming if we don’t change course in this country and focus 

on the things that are the drivers of the out-of-control spending—

but to cut the budget to State to save money in the hopes of 

strengthening our presence and growing strategies, and make 

stronger alliances in that area reminds me of the old veterinarian 

who was a cow rancher. He would always—he never had the best 

gates or the best fences, but would say you can’t starve a profit into 

your cattle. But he would feed them and he would take care of 

them, he would nurture them. 

It would be like planting a garden and hoping to have a bountiful 

crop or harvest, but you don’t want to fertilize it. We need to make 

sure that what we do we get the biggest bang out of our buck for 

the American people so that we can have peace in that area, we 

can have strong alliances, we can focus on economics, on national 

security, on trade, and cultural exchanges. 

My question to you, an America-first foreign policy is the goal, 

but I fear it will become increasingly difficult to obtain if we lose 

our influence in the Asia-Pacific to China. How does the administration plan to adapt to ensure that the United States remain a regional power? 

I have a follow-up question if you guys would tackle that one. 

Ms. THORNTON. Thank you, Mr. Chairman. 

I think what I would say first is that the budget that we have 

presented does reflect hard choices. But we should also remember 

that for the East Asia-Pacific region we have traditionally been less 

than 2 percent of foreign assistance spending globally. That means 

in the East Asia-Pacific region we have always gotten a lot of bang 

for our buck on what we have spent in the region. 

I think one of the ways that we do that is whether it is an America-first foreign policy, we are always doing it with America not 

alone. We are leveraging our money with other partners in the region, with the private sector. And what we are going to be doing 

and what we are going to be having to do with this budget is to 

be doing that even, even more efficiently and effectively going on 

in the future. 

26

One of the things that many of the members raised was the issue 

of security in East Asia. The U.S. has traditionally provided a lot 

of the security and stability in this region, which we have all come 

to treasure, and which has underpinned the economic dynamism 

and prosperity of the region. Of course, our U.S. military contributes a lot to that security. We have over the years built up great 

partnerships with our five treaty allies in the region and with a 

number of other partners that were mentioned by the Mr. Congressman Sherman. 

So, I think what we want to do is continue those partnerships, 

continue to work with others in the region to build up this network. 

We have invested a lot in these relationships already. We are working with the Department of Defense to make sure. We have a steering committee that has been set up at the direction of Secretary 

Mattis and Secretary Tillerson to make sure that we are well coordinated on all of the needs that we see out there for security assistance, for example, and that we are working together, both departments, to come up with the necessary funding for that. 

Mr. YOHO. Okay. And I appreciate that. I look forward to getting 

more of that out. 

Ms. Steele, if you have got—would like to weigh in, you have got 

about 40 seconds. 

Ms. STEELE. I would just——

Mr. YOHO. Your microphone. 

Ms. STEELE. I would just like to add that over the years what 

we have done is work with our partner governments to make sure 

that they begin to mobilize their own resources to contribute and 

provide leverage to ours. 

Mr. YOHO. And I appreciate you saying that because, you know, 

I came up here, I was one of the guys that wanted to get rid of 

foreign aid. But when you learn the process, I agree with General 

Mattis, cut foreign aid, buy more bullets; there is a balance in 

there. 

So our goal, and the mantra that comes out of our office, is go 

from aid to trade. If you look at historically our top 15 trading 

partners, 12 of those were recipients of foreign aid. That is what 

we want to do. I think you guys have done a good job if you are 

only getting 2 percent of the foreign aid budget. 

I look forward to the suggestions that come out. I am out of time 

and we now turn to the ranking member Mr. Sherman from California. 

Mr. SHERMAN. I agree with Mr. Chabot that the key on North 

Korea is to persuade China to change its policy. The easy way to 

meet our political objectives here in Washington is to say we can 

get China to change its policy without doing anything we don’t feel 

like doing. All we have to do is fly over to China, show them a picture of Kim Jung Un, show them a picture of his dead uncle, show 

them a picture of his dead half-brother, and persuade them to 

change their policy because, after all, China doesn’t understand 

Asia near as well as we do. And if they just listen to us they will 

change. 

This is absolutely absurd. China is not going to change its policy 

toward North Korea till we change our policy. We have one of two 

choices: Either make it plain to China that they cannot have access 

27

to our markets and continue their current policy toward North 

Korea, or we can build civil defense starting in Los Angeles. 

Ms. Thornton, back in the day, North Korea wanted a non-aggression pact with the United States. Chaney vetoed it because he 

wanted to invade and then commit to Russia against North Korea. 

I realize this isn’t a hot issue now, but what is the official U.S. position whether we should have a non-aggression pact with North 

Korea? 

Ms. THORNTON. I think what, what we are doing on North Korea, 

and I think it is——

Mr. SHERMAN. If you don’t know, if we don’t have an official policy just let me know. 

Ms. THORNTON. Well, on a non-aggression pact——

Mr. SHERMAN. Yes. 

Ms. THORNTON [continuing]. I mean I think——

Mr. SHERMAN. Are we interested in negotiating a non-aggression 

pact with North Korea? 

Ms. THORNTON. Not——

Mr. SHERMAN. Yes, no, or? 

Ms. THORNTON. Well, we are not interested, yeah, we are not interested—I mean we are interested in peacefully resolving——

Mr. SHERMAN. Okay. But——

Ms. THORNTON [continuing]. The issue on North——

Mr. SHERMAN. But we don’t have a specific strategy on a non-aggression? 

Ms. THORNTON. Well, we are not, we are not going for regime 

change, and we are not trying to have a collapse. 

Mr. SHERMAN. Okay. 

Ms. THORNTON. And we don’t want military conflict with North 

Korea, so. 

Mr. SHERMAN. Okay. I believe that Ms. Steele has commented on 

the trade relationship. We have trade deficits with China of 340; 

Japan, 69; 83 billion with Southeast Asia. 

Now, people often come here and they say things are wonderful 

because we have exports. But, of course, the exports are dwarfed, 

and increasingly dwarfed by the imports. What matters is the net 

trade. Getting 5,000 jobs while you are losing 10,000 jobs is not the 

way to build the U.S. economy. 

Ms. Thornton, does the administration have a policy that you are 

confident will reduce our trade deficit with East Asia by a significant amount over the next few years? 

Ms. THORNTON. Well, I think what we are trying to do is——

Mr. SHERMAN. Do we have a policy that will——

Ms. THORNTON. Yes. 

Mr. SHERMAN [continuing]. Achieve those objectives? 

Ms. THORNTON. I think we do have a policy. 

Mr. SHERMAN. So you are confident that when you come back 

here 3 years from now our trade deficit is going to be substantially 

less than it is now? 

Ms. THORNTON. I am, I am confident that we are working in that 

direction, yes. 

Mr. SHERMAN. Working in. But and how is this direction different from the last 3 years? 

Ms. THORNTON. Well——

28

Mr. SHERMAN. Because if we didn’t achieve that in the last 3 

years, what are we doing different now? 

Ms. THORNTON. Well, we are trying to grow the entire Asian 

economy but cut, enforce better the trade mechanisms that are in 

place and pursue agreements with countries where we have trade 

imbalances to try to write restrictions on market access and also 

try to fight——

Mr. SHERMAN. And you are saying that wasn’t true in 2014? 

Ms. THORNTON. We have been doing——

Mr. SHERMAN. We did it then, we are doing it now, we are going 

to keep doing it. The definition of insanity is to keep doing the 

same thing we did then and expect a different result. 

The budget that the administration has proposed, does it save 

from the axe those diplomats that are working to push American 

exports, agriculture, and manufacturing? Or does it cut our efforts 

in the State Department to promote our exports? 

Ms. THORNTON. I don’t think that the budget that we have presented reflects those kinds of cuts to our personnel, no. And we are 

certainly, one of our——

Mr. SHERMAN. So we are going to slash the State Department 

but those officers that are promoting exports are not going to be 

slashed? Everybody else is going to be slashed a little bit more? 

Ms. THORNTON. So I think, are you talking about the cuts to ops? 

Cuts to our operations——

Mr. SHERMAN. Yeah. 

Ms. THORNTON [continuing]. That have been proposed are not 

that significant actually, so to personnel and things like that there 

is not a major reduction there. 

Mr. SHERMAN. Islands——

Ms. THORNTON. Not in the commercial promotion area. 

Mr. SHERMAN. Ms. Steele, why are we slashing our aid to islands 

that are so incredibly strategic and have received almost no aid but 

now we are going down to zero for the Marshall Islands and Micronesia? Why do—why shouldn’t we at least continue our $500,000 

a year aid to those two? 

Ms. STEELE. The President’s budget request includes—we support the Pacific Island countries, which includes Marshall Islands 

and Micronesia, through a regional program that is run out of the 

Philippines. And we—the President has requested $5 million to 

support the countries in the Pacific. So we will continue supporting 

them. 

Mr. SHERMAN. Is that a higher or lower rate of support than we 

had last year? 

Ms. STEELE. It is lower. 

Mr. SHERMAN. In spite of their strategic significance. 

So we are going to spend hundreds of billions of dollars to fight 

with China over little islets that we claim have strategic significance but really don’t, and we are going to ignore the chance to 

spend a tiny, tiny fraction of that on the islands that are in the 

middle of the Pacific and dominate that area. 

I yield back. 

Mr. YOHO. We will next go to Mr. Dana Rohrabacher of California. 

29

Mr. ROHRABACHER. Thank you very much, Mr. Chairman. And 

congratulations on your assuming the chairmanship. We appreciate 

it, look forward to working with you in the years ahead. 

Let me just note that we have just ended 8 years of disintegration of major western bulwarks throughout the world against various elements that are hostile to the United States, whether we are 

talking about what is going on in Turkey, the Philippines, or what 

is happening in North Korea where it didn’t start off as one of our 

bulwarks but now is threatening one of our bulwarks, which is 

South Korea and Japan. 

As far as American foreign aid, there are many people who believe that just giving money to people or trying to provide money 

and resources to promote various cultural elements of our society 

is a waste of American resources. 

I know that if we take a look very closely at some of the expenditures that we have left that has been described, I don’t necessarily 

believe that they are going to make things safer for us or better 

for those countries. So, I am pleased that President Trump has 

kept his promise and is moving forward with a theories based on 

what he believes and what some of us believe are—is best for the 

American people rather than trying to buy off other people in other 

countries. 

In terms of North Korea, I was disappointed in your answer, but 

I do believe your answer reflects a policy that we don’t have. I 

would just suggest that the little, I will refrain from using a pejorative phrase to describe the leader of North Korea, is so, so 

much—is easy to make fun of, but the fact is that this human 

being is a murderous, treacherous man who has murdered his own 

friends and family. We cannot afford to have a nuclear weapon at 

his disposal that could hit the United States. 

I would suggest that we owe Ronald Reagan a great debt because 

Ronald Reagan insisted on moving forward in an aggressive way to 

build a missile defense system. I remember him being belittled for 

saying that we can have a rocket that can—a bullet that can hit 

a bullet. Oh, it is impossible. He was belittled for that. The fact 

that we went ahead, full steam ahead and have developed such 

systems now gives us some leverage in dealing with this maniac. 

It was never intended to try to prevent us from preventing a major 

exchange between major powers of nuclear weapons, but it was just 

specifically for a case like this. And thank God he had the vision 

to move forward over and above being ridiculed for doing that. 

My recommendation to this administration is our policy in North 

Korea should be that if indeed it appears that, again, this unstable—and that is a generous way of describing this dictator’s personality—an unstable character like this looks like he is going to 

launch a rocket, again, another missile with capabilities of threatening the United States, we should shoot that missile down. If it 

continues, we should use our cyber capabilities to basically turn everything off in North Korea. 

That is what I would recommend. I hope we have a President 

now that instead of trying to buy loyalty or thinks he is going to 

buy peace, that we have one who I think will step up to the plate. 

And we will wait and see. 

30

In terms of—let me ask one question. It seems that I gave my 

spiel here. 

Is there any indication, we have Burma and Vietnam, which 

Burma has supposedly made some progress. We have Aung San 

Suu Kyi now in a place where no one would have dreamed about 

10, 15 years ago. We all worked so hard to get her there. I was part 

of that team. But in Vietnam, is there anything in Vietnam that 

would suggest to us that there is a democratic liberalization going 

on at all? If not, why the heck are people so anxious to set up a 

trade treaty with a country that hasn’t had that progress? 

Whoever wants to answer is fine with me. 

Ms. THORNTON. Okay. Thank you very much. 

On Burma I would say, yes, we are working very hard to consolidate the gains there and to support governance in Burma. There 

are some issues still to work on there. Obviously, a lot of ethnic 

problems and unrest. There is a peace process which Aung San 

Suu Kyi has sponsored and which we have supported and that we 

want to see continue to be successful. 

We also are working very hard to make sure that the continued 

civilian governance over the military is proceeding in that country. 

On Vietnam, Vietnam is the fastest growing U.S. export market 

in the world. They are a significant economic partner of the United 

States. We have had a growing partnership and relationship with 

Vietnam on security in the East Asia region, particularly in Southeast Asia, and have found them to be partners in various areas of 

U.S. interest. 

We have not, unfortunately, made the gains that we would have 

hoped to in the human rights situation in Vietnam. But we do continue to work on that and have had a human rights dialog going 

with them and continue to press them on those issues. 

I will let maybe Gloria Steele respond as well. 

Mr. ROHRABACHER. Let me just note that the fact that you were 

unable to really specify any real progress toward democratic government in Vietnam indicates that the first things that you mentioned are not in our interest to start opening up. I do not believe, 

as I never believed with China, that just as we were going to open 

up our markets and have an economic relationship, which has built 

this monster that China is today, that that is in the interests of 

the United States if it does not couple with democratic reform. 

And we were promised it would be, but it never happened in 

China. There has been no democratic reform. Now we have created 

a monstrous threat to democracy. 

Mr. YOHO. The gentleman’s time has expired. 

Ms. Steele, I will come back to you. But we want to go on to Mr. 

Connolly right now. 

Mr. CONNOLLY. I thank the chair. And my friend, who also 

worked for Ronald Reagan when I was here on the Hill during the 

Reagan years, and my job was to authorize the foreign aid budget, 

let me just say I knew a little bit Ronald Reagan. Donald Trump 

is no Ronald Reagan. 

Ronald Reagan never cut the foreign aid budget by 46 percent. 

Ronald Reagan understood strength meant you go forward, you 

don’t retreat. You don’t create a vacuum in which your adversary 

can readily and smartly and enthusiastically step in. 

31

There is an Orwellian quality to this hearing. And I am going to 

challenge both of you. Let me stipulate for the record in case, so 

you don’t get in trouble. You’re loyal officials of the United States 

Government defending the indefensible, the Donald Trump foreign 

aid budget and State Department budget. But, okay, we will stipulate you have done that. 

Ms. Thornton, you said to Mr. Sherman that there weren’t really 

going to be significant personnel cuts. So let me talk about your 

boss. Your boss said otherwise. Your boss said, Mr. Tillerson, Secretary of State, 2,300 jobs will be cut. He even specified how they 

will be cut: 700 through buy-outs, and 1,600 through attrition. You, 

you think that is not significant? Because that is how you answered Mr. Sherman. 

Ms. THORNTON. I think I was speaking to the operational budget——

Mr. CONNOLLY. Well, how do you know,——

Ms. THORNTON [continuing]. For the East Asia——

Mr. CONNOLLY [continuing]. If there was that level of cuts, Ms. 

Thornton, how could you possibly sit here and testify that you 

don’t, that that won’t affect operations? How would you know that? 

Ms. THORNTON. I only know what is happening in the East AsiaPacific Bureau fixed——

Mr. CONNOLLY. Have these cuts happened yet? 

Ms. THORNTON. Not that I am aware of. 

Mr. CONNOLLY. No. So you don’t know what the impact is going 

to be. And, frankly, your answer to Mr. Sherman is nullified. You 

don’t know whether in fact it would affect people who are in charge 

of exports from running U.S. exports. It could, in fact, have an appreciable effect, couldn’t it? We don’t know yet. 

I assume by your silence you acquiesce. 

Ms. THORNTON. I mean that is not an area that we are—I mean 

that is a priority area that we would look to. 

Mr. CONNOLLY. When this——

Ms. THORNTON. Because I would look to——

Mr. CONNOLLY. If Secretary Tillerson isn’t understating the number of cuts, you don’t know the impact yet. That is really the answer to Mr. Sherman’s question. It is not a gratifying or reassuring 

answer. 

Ms. Steele, you talked about $235 million that will strengthen 

our vital programs. Now, I went to Maryknoll, too, so I read George 

Orwell and I think you did too. That is a 46 percent cut. 

Have you in AID notified all of your contractors, all of your nonprofits, and your own hands-on work to prepare for a 46 percent 

cut? And are they doing that? Are they developing plans to absorb 

that cut? 

And, oh, by the way, did you tell them by doing this we will 

strengthen our vital programs? 

Ms. STEELE. Yes, we are in constant discussions with our implementing partners. 

Mr. CONNOLLY. I am sure you are. But I didn’t ask that question. 

Have you given them instructions to absorb a 46 percent cut? 

And have you told them, by the way, that will make you stronger, 

not weaker? 

32

Ms. STEELE. We have been talking to them about coming up, 

coming up with their share of the program budget. 

Mr. CONNOLLY. You mentioned the progress—I am sorry I am 

being, but I only——

Ms. STEELE. Sure. 

Mr. CONNOLLY [continuing]. Have 1 minute and 40 seconds. 

Ms. STEELE. Sure. 

Mr. CONNOLLY. You mentioned Cambodia. I have been to Cambodia. And malaria is a huge problem in Cambodia. Getting it 

under control, wonderful thing for them in terms of productivity, 

tourism, and the like. Are we a 2 percenter in the malarial prevention and eradication program in Cambodia or are we a major player? 

Ms. STEELE. We are a major player. 

Mr. CONNOLLY. Yes. 

Ms. STEELE. And have helped them significantly. 

Mr. CONNOLLY. Right. So we are not, this isn’t like, well, we are 

kind of a bit, you know, bit player. In malaria in Cambodia we are 

actually a big player. 

Ms. STEELE. Right. 

Mr. CONNOLLY. And to absorb a 46 percent cut, I mean, the Cambodian Government said, great idea, that will make us stronger; we 

like that? 

Ms. STEELE. Actually, Congressman Connolly, we told them right 

from the start, and they have agreed, that they will begin to assume the costs of our supporting them. 

Mr. CONNOLLY. Begin to assume. 

Ms. STEELE. In 2020——

Mr. CONNOLLY. This 46 percent cut doesn’t phase in, it happens 

in this fiscal year if it is adopted. 

Ms. STEELE. And there will be—they have significantly achieved, 

they have achieved significant gains. 

Mr. CONNOLLY. So your testimony to this committee, you are absolutely going on record reassuring us that there will be no step 

backward in the malaria eradication program in Cambodia, or anywhere else in the region for that matter? 

Ms. STEELE. Our, our studies have shown that they will be able 

to eradicate malaria. 

Mr. CONNOLLY. But you do understand the other side of your testimony is, therefore we have been over-paying and over-appropriating USAID all these years because apparently we could have 

done with almost half of what we have been doing with no material 

effect. And these countries really could have been picking up the 

slack, they just didn’t do it because we didn’t cut it in half? 

Ms. STEELE. No, sir. The costs are up front. We are developing 

their capabilities and their institutions. And right from the beginning we tell them we will be phasing out; they have to be able to 

assume the costs. 

Mr. CONNOLLY. Ms. Steele, I understand that. 

Ms. STEELE. And they have agreed to do so. 

Mr. CONNOLLY. But that begs the question of an abrupt and draconian cut as is proposed that the chairman pointed out to us. To 

try to absorb that is massive, just I have to assume disruptive, as 

someone who managed programs myself. And for 10 years had 

33

oversight responsibility for AID in the United States Senate Foreign Relations Committee. I have never heard testimony like that. 

Never from the Ronald Reagan administration. 

My time is up, Mr. Chairman. I yield back. 

Mr. YOHO. Thank you and I appreciate it. 

But I want to add in here before we go to the next—Ms. 

Gabbard, if you will indulge me just a minute. 

Austerity cuts are coming to this country. We know that. I 

thought it was very pertinent of what you said that they realize 

that they are going to have to step up. 

I was in the Congo about a year-and-a-half ago and we were sitting at the foreign ministry cabinet. The President of the DRC 

would not meet with us. And we have given them hundreds of billions of dollars for years. I asked very pointedly, what do you do 

for social programs? And their eyes kind of widened, they were 

like, what do you mean? I said, for housing, for education, for medicine, insurance? 

And they said, we have you. 

That is not a good foreign policy. And we have spent all that 

money in the past so things have to change. We are being forced 

into a situation. I think some of those times tough love, it may—

and I am not saying it is the best way—but in certain situations, 

especially in our economic downturn that we have, we need to 

make some changes. 

I am going to go to Ms. Gabbard from Hawaii right now. 

Ms. GABBARD. Thank you, Mr. Chairman. Thank you both for 

being here. 

The administration has come before our committee and spoken 

publicly about their focus and efforts on a diplomatic solution and 

resolution to the North Korea threat and crisis. With China mobilizing its military along the North Korea border, stepping up its 

surveillance, it does not appear that serious diplomatic efforts are 

either working or continue to be underway beyond saying, well, we 

think Russia and China need to comply with sanctions. 

I wonder if you can talk about how this budget actually supports 

a serious diplomatic strategy in resolving the threat from North 

Korea and, if so, what is it? 

Ms. THORNTON. Thank you very much. 

Yes, I think the budget, obviously we don’t have assistance programs in North Korea, but it reflects the operational costs of our 

prioritization of the North Korea issue in our Bureau. I think what 

our strategy is looking like at the moment, we have made this the 

highest foreign policy priority of the administration. I think it is, 

that is a change from previous practice. 

We have opened up a global pressure campaign in which we are 

asking other countries to step up to the plate and do more on pressuring North Korea. What happens when you try to squeeze off 

North Korea’s proliferation networks, and economic and financial 

networks, is they go, they go elsewhere. They go to Africa. They go 

to Southeast Asia. They go maybe to Latin America. 

And we are trying to have a global network and a global consciousness-raising surrounding upping the pressure of both sanctions but also diplomatic isolation vis-a-vis the North Korean regime, trying to build up a pressure campaign so that they can 

34

change the calculation that they have made surrounding the costbenefit analysis of their weapons programs and their missile programs. And——

Ms. GABBARD. So what happens, what happens next beyond that? 

What happens next after you pick up the pressure? 

Ms. THORNTON. So we have just started building the global pressure campaign in, basically in April. We have been talking, of 

course, to the Chinese and the Russians and other major players. 

The third change from previous practice is that we have really 

put the onus on China to do a lot more than they have ever done 

before. 

Ms. GABBARD. And are they? 

Ms. THORNTON. And they are doing more than they have ever 

done before. They have——

Ms. GABBARD. It seems like they are preparing for something 

other than a diplomatic solution at this point. 

Ms. THORNTON. I would, I would not necessarily go quite that 

far. I think they are very much focused on a peaceful resolution. 

They do agree that there needs to be an increase in pressure on 

the North Korean regime. And they want that to happen in a way 

that brings the north back to the negotiating table as quickly as 

possible. 

The problem is that right now the north doesn’t seem to be very 

inclined to come back to the negotiating table with any kind of serious attitude or proposal. So, what we are doing is continuing to 

sort of squeeze and close the vise, and hope that that brings about 

a reckoning——

Ms. GABBARD. Thank you. 

Ms. THORNTON [continuing]. And fear that they are paying too 

much for their weapons programs. 

Ms. GABBARD. Thanks. 

I would like to get one more question in here specifically about 

organizations like the Asia Foundation, the East-West Center, both 

of which have for decades provided great contributions to engagement, formation of policy, building relationships within the region. 

This year the administration’s budget completely zeroes out 

funding for both of those organizations. We have been told that this 

was done because the administration believes they receive outside 

funding and no longer need any assistance from us. I am wondering what specific evidence went into making that decision making process. Specifically, were these organizations engaged directly? 

Did you hear directly from them? 

Because I can tell you I have met with them year after year after 

year, and while they are making progress on leveraging the funding that they are getting, they are not able to continue to function 

if this administration continues to eliminate and zero their funding 

completely. 

Ms. STEELE. I have not been involved in the analysis that went 

into deciding whether Asia Foundation or the East-West Center 

gets funding. We do know, though, that we have had to make 

tough prioritization of the programs that we would be funding. 

Ms. GABBARD. So the justification that we got, though, was the 

administration’s assessment that they could operate, continue to 

function purely on outside funding. But you don’t know how that 

35

conclusion was reached or if there was any input or engagement 

with these organizations? 

Ms. STEELE. I was personally not involved in the discussions on 

funding for Asia Foundation. 

Ms. GABBARD. So this is, I mean you, but you guys are the people 

to talk to in the State Department about the Asia-Pacific where 

these organizations are focused. So if it wasn’t you then—and your 

input was not sought in this direction, then whose was? 

Ms. THORNTON. Well, we engage regularly in the Bureau with 

both Asia Foundation and the East-West Center. And so I think we 

have been keeping up a constant communication with them in recent years about the need to do more to wean themselves off of government funding. I know that in particular East-West has, has 

changed its management and raised their capital campaign, et 

cetera. So we are aware of all of those activities. 

The Asia Foundation, we also talk frequently with them. We are 

well aware of their programs in various countries. But I think in 

the prioritization this year, I think that was one of the hard choices 

that was made. 

Ms. GABBARD. Okay. Again, I have had these same conversations 

encouraging them to continue to build their outside support. But to 

go from I think it was East-West Center had $16 million or $17 

million last year to zero, you are setting up these organizations up 

for failure. 

Thank you. 

Mr. YOHO. I thank the lady’s questions and the responses you 

guys are giving. 

I would like to move on to a second set of questions, if it is all 

right with you, if you guys can tolerate us. 

You know, I guess one of the biggest things I see is we are going 

to go through these cuts. And how many people are in State? Do 

you have a number of how many people are in the State Department total around the world? 

Ms. THORNTON. I think the total number is, that I have heard 

the Secretary mention recently, something like 70,000. 

Mr. YOHO. Seventy thousand. So a 10 percent cut would be 

7,000; 5 percent would be 3,500. So we are looking at less than a 

5 percent cut if we cut 2,300. 

We don’t want to be forced to cut but I think sometimes we do 

need to shrink down some things. And, again, going into austerity 

measures that we see, we are teetering on them, we need to make 

sure that we are getting the most out of the money we are giving 

and the most results. 

Saying that, did you know how the process went where they decided what programs they were going to cut? You guys have said 

in the beginning a lengthy career between you. So you have had 

a lot of experience. Were you able to weigh in and say these programs are good, these are bad? 

Ms. THORNTON. Yes, very much so. We have a very elaborate 

budget development process that takes in all levels of the State Department and AID, input from the field, built up from there, that 

we have sort of our top level officials that have to make some hard 

decisions in consultation with us. And we have to make some 

choices. 

36

Mr. YOHO. All right. So you do get to weigh in on that? 

Ms. STEELE. Yes, we do, sir. 

And, in addition, we look at where they are in the implementation, what progress they have made, what achievements they have 

made. And in making selections we look at those that, those that 

have been successful and no longer need any support from us because either someone else in their country will pick it up or the 

government itself will, as in the case of the health sector in Cambodia. Then, you know, we begin to phase out. 

But we do have involvement. It is data-based. We monitor and 

evaluate our programs. And I will get rid of programs that are not 

producing and continue those that are showing a lot of progress. 

Then those that have achieved what they have to achieve, then we 

then phase them out. 

Mr. YOHO. When I was practicing as a veterinarian we had the 

economic downturn in the 2007 roughly, we had to go through and 

we had to trim budgets, we had to, you know, cut back overhead. 

And it is good to see that you guys are doing that, that you get to 

weigh in and you get to say these are the effective programs, these 

aren’t. 

I think that is a lesson to be learned. That is one of the ways 

that we are going to have to make these changes so that we can 

get a hold of our spending so that we are not forced in really draconian cuts that would be much worse than this that we have seen 

in other countries. 

Saying that, knowing that Cambodia has got an election coming 

up in this next year, to assure free and fair elections we have 

heard time and again that the robust election monitoring is needed. 

Will this budget support these needs, in your opinion? Because I 

see a 74 percent cut in the change for Cambodia between 2016-

2018. 

Ms. STEELE. Yes, sir. We still have funds that are available. We 

are supporting two organizations in Cambodia. One is focused on 

working with civil society organizations to increase the participation of the youth and women. And the other organization is working with the National Election Commission to improve their performance so that they can be more transparent and credible. 

We do have funds at this moment, at this time to support them. 

Mr. YOHO. All right. That’s good to know. 

I want to move on to when it comes to countering China’s growing influence—and this is something, if anything keeps me up late 

at night, this is something I worry about probably more than anything, or am more concerned about and I think we really need to 

pay more attention to—but when it comes to countering China’s 

growing influence, what programs do you believe give us the most 

bang for our buck in terms of empowering our partners in the region to defend their territorial claims against China’s growing aggression? Would it be the foreign military financing, support of governments? What are your thoughts on that, if I could hear from 

both of you? 

Ms. THORNTON. Yes. I will just speak very briefly on this. 

But I think that the most important programs are diplomatic, 

economic, and security programs, mostly the capacity building that 

we do in Asia, with all of our Asian partners to improve governVerDate 0ct 09 2002 11:28 Nov 14, 2017 Jkt 000000 PO 00000 Frm 00040 Fmt 6633 Sfmt 6633 F:\WORK\_AP\072717\26430 SHIRL
37

ance, to improve their capacity to conduct international trade, to 

promote their integration with other partners in the region, to support regional organizations like APEC and ASEAN, and also to 

make sure that they have the capabilities that they need, of course, 

military and else, otherwise, law enforcement, et cetera, to protect 

their borders and defend their sovereignty, so. 

Mr. YOHO. Let me get Ms. Steele to weigh in on that. 

Ms. STEELE. In the development area we work with them to 

strengthen their democratic institutions, work with them on fighting corruption in order to level the playing field, and which China 

would have a hard time dealing with. 

And then we provide a real, much better, more responsible and 

sustainable alternatives in all the other areas: In health, and in 

the area of trade, looking at the regulations and making them more 

transparent. 

Mr. YOHO. All right, thank you. 

Now we will turn to Mr. Sherman for another round. 

Mr. SHERMAN. Ms. Thornton, this is really kind of a worldwide 

question, so a step above your pay grade, but does the President’s 

budget involve a cut in broadcasting and other Internet, other 

Voice of America and similar activities? 

Ms. THORNTON. I can’t speak to the worldwide budget for that. 

But we do have money for broadcasting in Asia. And——

Mr. SHERMAN. And how much money would you have under the 

President’s budget versus how many you spent in the most recent 

year? 

Ms. THORNTON. Well, I think we are actually continuing and 

maybe even enhancing some of our broadcasting area in Asia, specific to the North Korea challenge. 

Mr. SHERMAN. But overall, for the entire region that you are here 

representing, your Bureau, up or down? 

Ms. THORNTON. Probably——

Mr. SHERMAN. Or if you just want to furnish the——

Ms. THORNTON. Yes, I can take the question and get back to you. 

I am not totally——

Mr. SHERMAN. Okay. 

Ms. THORNTON [continuing]. Sure about the overall. 

Mr. SHERMAN. In particular we have an ideological battle in the 

Muslim world. ISIS is reaching out, trying to recruit terrorists in 

the Philippines, Indonesia, Malaysia, Myanmar. I would like you to 

specifically provide answers on whether your budget is going up or 

down in those Muslim majority or signi—or Muslim minority countries. 

Now, one issue that comes before us is this whole ratcheting up, 

war fever almost, regarding these little islets off the shores of 

China. We are told that we either should perhaps just spend hundreds of billions of dollars over the next few years gearing up our 

whole military and spending more on our military to confront 

China, or maybe we should go to war. I mean, if we avoid an actual 

fighting war, we will at least have a cold war over these islets. 

We are told these islets are of critical significance, first because 

trillions of dollars of trade go close to those islands. Yes, it is all 

in and out of Chinese ports. So if the Chinese control these islands 

they would be in a position to blockade their own ports. There is 

38

some trade that is oil tankers from the Gulf to Japan that could 

get close to these islands or could just as easily stay hundreds of 

miles away. 

So, the other reason we are given that we have to deploy our 

military and increase it is that we are incredibly, intensely concerned about maritime disputes, making sure that they are handled fairly. But there is no islet—there is no oil under these islets. 

They are so useless that no one has chosen to live there in all of 

recorded history. 

But there is a maritime dispute that is significant, that is the 

one between Australia and East Timor. Ms. Thornton, do we spend 

much time at the State Department worrying about that dispute? 

Ms. THORNTON. Well, we actually, we actually have worked on 

the East Timor-Australia dispute——

Mr. SHERMAN. I know you have worked. But I mean compare the 

national obsession with the islets I talked about to the level of 

staffing that goes on in your Bureau with regard to this dispute. 

Ms. THORNTON. But the difference is that they are in dispute resolution mechanism and have peacefully agreed to do that, willingly 

by both sides. Whereas, the disputes in the South China Sea are 

actually——

Mr. SHERMAN. Well, I mean it will obviously be peaceable because East Timor could not go to war against Australia. But 

whether they agree to a new dispute resolution or not depends 

upon, depends upon Australia. So it is these islet—well, I have 

taken enough time. We were just going to do a short, a short second round. 

So I will yield back. I will say simply that there are 40, at least 

20, perhaps as many as 40 maritime disputes around the world. 

We don’t have our ships going eyeball to eyeball with the second 

most powerful nation in the world over any of these. I couldn’t even 

name for you the third most significant maritime dispute in the 

world. I give myself credit for knowing of the East Timor one, 

which I believe is the second if you skip oil matters. 

So the idea that the United States always must spend hundreds 

of billions of dollars to involve itself in each and every maritime 

dispute is not always true. 

And I yield back. 

Mr. YOHO. I thank the gentleman and I thank your responses on 

this. 

But I am going to comment on that because there are a lot of 

maritime disputes around the world, but how many of them have 

10,000 foot runways? How many have military barracks? How 

many of them are militarized with both offensive and defensive 

weapons and radar systems? 

I will agree there is a lighthouse on there for peaceful navigational purposes. I think this is something, because we do see an aggressive China. We have seen what they have done with Taiwan; 

they are boxing them in. We have seen what they have done with 

Hong Kong. I think this is something, it is like anything else in 

life, if you have got a problem, if you ignore it it is not going to 

go away, it will get worse, and it is going to be worse to deal with 

and more expensive and more costly. 

And we know——

39

Mr. SHERMAN. Mr. Chairman, if you will yield. 

The disputes involving Cyprus, its offshore natural gas fields, islands between Greece and Turkey, have also involved military 

preparations involving two NATO countries we might have an even 

greater interest in. And, yet, we are not pivoting toward the eastern Mediterranean in an effort to prove to Turkey or Greece that 

we are going to be involved in that dispute. 

But I realize that not only has the United States wildly exaggerated the importance of these islands, it also meets political needs 

in Beijing to wildly exaggerate their importance. And building an 

air field is just one way of pandering to excessive nationalism in 

China. 

Mr. YOHO. I will look forward to having more debates on it because what I see is a nation like China has claimed sovereignty to 

areas that the rest of the world says is not yours. And they went 

to the World Court. Vietnam challenged them. They lost the case. 

They ignored that. 

And we see them doing what they are doing. We have seen also 

some of their trade practices that are not conducive to open trade 

and honest trade. And I think it is something that we need to pay 

attention to. 

And I agree, I am not willing to—hang on just a minute—I am 

not willing to enter another conflict. I don’t want to. I don’t know 

anybody that wants that. And I am not wanting to bolster this by 

ourselves or try to offset this by ourselves. But when you look at 

the ASEAN nations, there are ten, the ten ASEAN nations, that is 

633 million people roughly, $2.5 trillion in GDP, if we create a vacuum we know the rules of nature—nature abhors a vacuum—it 

will be filled by somebody. 

And it is something we need to come together. And that is why 

it is so important that the cuts in foreign aid through State Department that you guys redirect the aid that you do have so that we 

form those strong alliances, as we said in the beginning of this 

meeting, that we form those strong partnerships in economic and 

trade, and we focus on aid not trade—I mean trade not aid, so that 

we can wean countries off and so that they can enter that realm 

of those countries. Those top 15 countries that we trade with today, 

the 12 of them that were recipients of foreign aid, so that these 

other countries can move into that and that we can wean these off, 

creating stronger alliances. 

Do you have anything else you want to add, Mr. Sherman? 

Mr. SHERMAN. Just that if instead of deploying the U.S. Navy to 

worry about these islets you want to deploy it to protect our ports 

from unfair Chinese imports, you may have a partner in that. 

Mr. YOHO. I look forward to having that discussion. And I think 

we could agree on that. 

Ms. Thornton, I thank you for your testimony, for the 

questionings you went through. Ms. Steele, I thank you for your 

time here. I thank you for your service to our nation. 

And with that—with no further comments or questions, this 

meeting is adjourned. 

[Whereupon, at 4:11 p.m., the subcommittee was adjourned.] 

(41)

A P P E N D I X 

MATERIAL SUBMITTED FOR THE RECORD

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SUBCOMMITTEE HEARING NOTICE 

COMMITTEE ON FOREIGN AFFAIRS 

U.S HOUSE OF REPRESENTATIVES 

WASHINGTON, DC 20515-6128 

Subcommittee on Asia and the Pacific 

Ted Yoho (R-FL), Chairman 

July 27,2017 

TO: MEMBERS OF THE COMMITTEE ON FOREIGN AFFAIRS 

You are respectfully requested to attend an OPEN hearing of the Committee on Foreign Affairs, to be 

held by the Subcommittee on Asia and the Pacific in Room 2172 of the Rayburn House Office Building (and 

available live on the Committee website at hL*t.P2..:t_1Yl\:~_QL~.h'D_Ali®.2 .. JlQ!J5~_,_gQ~): 

DATE: 

TIME: 

SUBJECT: 

WITNESSES: 

Thursday, July 27, 2017 

2:30p.m 

US. Interests in the Asia-Pacific: FY 2018 Budget Hearing 

Ms. Susan Thornton 

Acting Assistant Secretary 

Bureau of East Asian aud Pacific Affairs 

U.S. Department of State 

Ms. Gloria Steele 

Acting Assistant Administrator 

Bureau for Asia 

US. Agency for International Development 

By Direction of the Chairman 

seeks lo make its j(_u:ililles acces.-.·ihle Lo persons with disahilitie,\. 

call 202/225-502 I at least jhur husiness m advance 

avmla1n!J~t· 
43

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COMMITTEE ON FOREIGN AFFAIRS 

MINUTES OF SUBCOMMITTEE ON ________ A_si_a_m_•d_th_e_P_a_c•._!fi_c _______ HEARlNG 

Day __ I:_n_,_"_sd_a-"-y __ nate> ___ 0_7~_'2_7~'--'2--'0--'1_7 __ Room_---"RR=:::Oe:'B'-'2'-'l'-'7.:::2 __ 

Starting Time _ __,.2~:5"6'-'p~l.,.ll __ Ending Time 4:11pm 

Recesses L___to __ ) L___to __)(_to __ ) (_to__) ( __ to __ ) (_to __ ) 

Presiding Mcmber(s) 

Rep. Ted Yoho 

Checl< all ofthejollowin;; that apply: 

Open Session 0 Executive ~sed) Session D Televised U 

TITLE OF HEARING: 

Electronically Recordcl..f!aped) D 

Stenographic Record U 

"U.S. Interests in the Asia-Pac{fic: FY 2018 Budget Hearing" 

SlffiCOMMITTEE MEMBERS PRESENT: 

Rep. Ted Yolw, Rep. Dalla Rohrabacher, Rep. Steve Chabot, Rep. Scott Perry 

Rep. Brad Sherman, Rep. Ami Bera, Rep. Gerald Connolly, Rep. Tulsi Gabbard 

NON-SUBCOMMITTEE MEMBERS PRESENT: (Mark with an* ifthey are not members offidl committee) 

NIA 

HEARING WITNESSES: Same as meeting notice attached? Yes EJ NoD 

(If "no", please list below and include title, agency, department, or organization.) 

STATEMENTS FOR THE RECORD: (List any statements submitted for the record) 

Rep. Gerald Connolly 

TIME SCHEDULED TO RECONVENE----

or 

TIME ADJOURNED ____ _ 
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26430d-1.eps

Statement for the Record 

Congressman Gerald Conn oily 

AP Subcommittee Hearing "U.S. Interests in the Asia-Pacific: FY 2018 Budget Hearing" 

July 27, 20 I 7 

The strategic rebalance to the Asia-Pacitlc region was not an expedition into parts unknown. The 

United States maintains longstanding commitments with regional partners, including supporting 

economic integration and trade, enhancing regional security, advancing inclusive economic 

development, strengthening regional institutions, and addressing health and environmental issues. 

Protecting these interests requires significant financial investment, diplomatic capacity, and 

strategic messaging. Unfortunately, in just six months the Trump Administration has undermined 

nearly every foreign policy tool we have to protect American security interests in the region. 

President Trump has withdrawn from the Trans-Pacitlc Partnership, pulled out of the Paris Climate 

Accord, has failed to fill key State Department positions, and proposed decimating U.S. diplomatic 

missions and foreign assistance abroad. 

President Trump's FY 2018 international affairs budget represents a unilateral retreat from U.S. 

global leadership, and the East Asia-Pacific region (EAP) is no exception. The President's budget 

would reduce U.S. assistance to the region by 46 percent, a more drastic cut than any other region 

except Europe and Eurasia. Despite the Trump Administration's ostensible focus on security 

objectives, the request did not specify any Foreign Military Financing (FMF) grants for EAP. The 

Administration claims to prioritize countering violent extremism and the rise ofiSIS-affiliated 

groups in the Philippines and Indonesia; yet, the budget would cut funding for each country by $70 

million and $40 million, respectively. 

While President Trump has talked about his plan to defeat ISIS, his strategy remains opaque and the 

extent to which such a policy covers Southeast Asia is unclear. Trump has twice pledged to hold a 

press conference on the tight against ISIS, but that has yet to occur. The President's FY 2018 

international affairs budget represents a radical realignment of U.S. priorities. Nearly every East 

Asian country is subject to a sizeable decrease in U.S. foreign assistance. Digging deeper, the 

President's budget decimates regional programs that foster democratic governance, economic 

growth, and global health. The Trump Administration's shortsighted approach to counterterrorism 

fails to invest in the development measures that will be necessary to ensure terrorists do not return 

to the region or tlnd safe haven in the tlrst place. 

I am thankful to the witnesses for appearing before us today, and I have no doubt that you are both 

highly qualified civil servants. Nonetheless, each of you is here in an acting capacity because 

President Trump has declined to invest in the human resources necessary to carry out the State 

Department's and U.S. Agency for International Development's missions. At State, only three out 

of twenty-two assistant secretary vacancies have a nominee, and none would cover East Asian and 

Pacific Affairs. The White House reportedly rejected Tillerson's first choice for top Asia envoy, 

which only exacerbated an already hollowed-out permanent senior leadership. At USAID, no one 
45

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26430d-2.eps

has been nominated to t111 any of the ten deputy and assistant administrator positions. As the cochair of the Congressional Caucus on Korea, I am particularly concerned that President Trump has 

failed to nominate an ambassador for arguably the most critical post in the region, South Korea. 

This deficiency of financial and human resources is not the Trump Administration's only selfinflicted wound. The Administration also lacks a strategy to address the region's ongoing conflicts 

and challenges. While President Trump has said that he will not allow North Korea to obtain a 

nuclear weapon, he has articulated no strategy toward the threat. Meanwhile, the North Korean 

regime has conducted 17 ballistic missile tests in 2017 alone, including the July 4launch of an 

intercontinental ballistic missile that is capable of reaching Alaska. The United States, the Republic 

of Korea, and other regional stakeholders must demonstrate a commitment to addressing this threat. 

This week, the U.S. House of Representatives overwhelmingly passed the strongest sanctions bill 

ever considered in Congress. I was proud to support H.R. 3364, the Russia, Iran, and North Korea 

Sanctions Act, which updates and expands U.S. sanctions on North Korea and closes loopholes 

exploited by the Kim regime in the search for hard currency to fund its illegal weapons program. 

U.S. sanctions are a necessary but insufficient tool to address the threat of North Korea's weapons 

program. The United States must undertake a rigorous diplomatic effort to urge the global 

community, and China in particular, to fully enforce international sanctions on North Korea. 

Instead, President Trump has only inflamed regional tensions by sending mixed messages about the 

location of U.S. military assets, threatening to withdraw U.S. support for missile defense, and 

warning of a major conflict with the North Korean regime. Navigating this complex web of regional 

stakeholders requires patient and committed U.S. leadership to avert the ever-present potential of 

conflict that looms over 75 million Koreans. 

The hard truth is that when the United States does not act as a forceful advocate for our principles 

and our interests abroad, we leave a vacuum. When U.S. leadership retreats, adversaries who do not 

share our interests and values t111 that vacuum and endanger U.S. security. I look forward to hearing 

from our witnesses on how the President's budget protects U.S. interests in the East Asia-Pacific 

region when it decimates our diplomacy and development missions. 

2 
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26430e-1.eps

Questions for the Record 

Ranking Member Eliot Engel 

"US. Interests in the Asia-Pacific FY 2018 Budget Hearing" 

On July 27, 2017 

China & North Korea 

I. How does North Korea's two recent ICBM tests change the State Department's strategy and 

lime line for addressing North Korea:1 

2. Is the United Stales considering preemptive militmy action against the regime in 

Pyongyang? If so, what is the nature of that action and under what circumstances will it be 

pursued? 

-'· Given the pace of North Korean nuclear and missile de•·elopmen/, is the Department willing 

to support a 'freeze" of the North Korean nuclear program as a .firs/ step toward the goal ()f 

a denuc/earized Korean peninsula? 

4. In negotiations with China on the North Korea issue, what as.surances is the United Stales 

willing to pro ride Beijing regarding the end-stale on the Peninsula? 

5. ~f US sanctions against North Korea arefit!ly et!fbrced, what will the impact on North 

Korea's economy be 7 What will the impact be on other countries? 

6. What is your current assessment oft he diplomatic options related to North Korea? How 

might North Korea respond to the various options? 

7. If the United Stales was to enter negotiations with North Korea, what assurances would the 

Kim regime likely seek? 

a. Is the United Stales willing to slop or slow ourjoinl military exercises with South 

Korea? 

b. Is the United Stales willing to provide assurances regarding the surviral oft he Kim 

regime? 

c. Is the United Stales willing to discuss a ·'peace accord" on the Korean Peninsula to 

supercede the armistice? 

Philippines & Section 333 Assistance 

8. The Defense Departmem recently suhmiued a Congressional Notification related to counter 

narcotics lrainingfor the Philippines National Police under Section 333. Was the Stale 

Departmem consulted during the development 011 this proposal? Does the Deparmtent 

support lrainingfix the Philippines National Police, given their role in Dulerle "drug war?" 

9. To what ex/en/ is the Stale Department consulted on Section 333 counter-narcotics 

expenditures? What role does FAP, TNT., PM and USATD play in this process? Hmt• cm1 the 
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26430e-2.eps

State-DOD coordination process be improved so that State has greater visibility and policy 

direction with respect to DOD counter-narcotics expenditures? 

lO.ln the con/ex/ of/he Stale Department reorganization effbrl, is there consideration being 

given to returning DOD's the counter-narcotics authorities and.fimding to State fur 

management of these programs? if no/, why not? 

11. Describe the State-DOD coordination process for security sector assistance under the new 

authority, Section 333. How dues State conduct meaning/ill policy coordination vi s-ci-vis 

DOD programs? 

China's Belt and Road Initiative 

12. Without the Transpacific Partnership in play, how is the De par/men/ responding to China's 

overarching economic and diplomatic signa/ure Bell and Road iniliali\'e? How will/he 

United Stales engage to ensure that U.S. economic interests are protected in the Asia-Pacific, 

paving the way.fbr US. companies 10 benefitfrom Asia's growing markets? 

Vietnam & Dioxin Remediation 

13. US. .fimding.fbr the remediation of dioxin in Vielflam is one of our lop commitments to the 

Vietnamese government and many believe !hal keeping our commilmenlforfimding the 

.fbllmr-on project in Bien Hoa is a predicatefor our continued close cooperation with 

Vietnam. Please describe your plan to proceed with the necessaryfimdingfor this project 

and the impact 011/he bilateral relationship if the US. does no/ meet/his commitment? 

Burma and Military-to-Military Engagement 

14. How is the State Departmemworkingwith the Department of Defense and Pacific Command 

to maintain pressure on the Burmese military, while at the same time encouraging 

democratic consolidation in that country? What leverage do we have to urge the military to 

exit politics? Would you consider r~ji1sing to waive visa restrictions under the Jade act as a 

means to apply pressure? 

Foreign Military Sales and Financing 

15. With the dramatic cuts to military sales and training fur Jiast Asia and the Pacific, which 

countries do you expect to tum to China or Russia, in fill/ or in part, as their security partner 

u.f choice? 

16. What will the diplomatic impact he if there is increased participation hy China and Russia in 

security assistance in/he region? How would these derelopmen/s impact US. military 

readiness, interoperahility and cooperation with militaries and goremments in the Asia2 
48


26430e-3.eps

l'ac!fic region? How will this diminish the State Department and Chi~f of Mission ability to 

accomplish other non-military objectives in ~·as! Asia and the Pacific? 

Development & Economic Assistance 

17. With the dramatic cuts to development and economic assislancefbr lias! Asia and the 

l'ac!fic, which countries do you expect to turn to China or Russia, in filii or in part, as there 

security partner of choice? 

18. What will the diplomatic impact be if there is increased participation by China and Russia in 

development and economic assistance in the region? How will these developments impact the 

Stale Department and Chief of Mission ability to accomplish other diplomatic objectives in 

~(Ist Asia and the Pacific? 

19. The Asia -Pacific suffers severe impac/s resu/tingfrom climate change, rangingfrom se1·ere 

·weather to loss of coastline, to challenges with ·water and agricultural resilience. Where in 

Stale and USAJD 's budget are these issues addressed? 

a. Given that this is a top priority to many countries in the region, what soft-power 

it!fluence does the U.S. cede to China and other actors who are now positioned to 

lead on these issues? 

State Department Reorganization 

20. What Stale and USAJD missions and posts in ~as! Asia and the Pacific are being considered 

fbr closure in the context of the State Department reorganization? What guiding principle(.~) 

or philosophy is being employed in making these decisions? 

21. What State and USAf[) missions and posts in Fast Asia and the Pacific are being considered 

for expansion in the context (!{the State Department reorganization? What guiding 

principle(.~) or philosophy is being employed in making these decisions? 

22. What proportion oft he Slate EAP workforce is composed offellows? With the suspension of 

the Diplomacy Fellows Program and Presidential Management Fellows Program, and 

rumored cancellation or non-renewal of long-term of contract employees, what is the 

anticipated impact on FAP 's workfbrce? How will you ensure your ability to comply with 

congressionally mandated reports, Leahy vetting, and other requirements? 

23. For the Bureau of ~ast Asian and l'ac!fic Affilirs at the Department o.fState and the Bureau 

for Asia at USAJJJ, describe your current workforce (.~ize, rank, allocation to offices and 

subunit;,). include a breakdown o.fcivil service, Foreign Service, fellows detainees and 

conlrac/Ors. 

a. What attrition do you anticipate in the next 18 months? How will you .fill these 

vacancies? How will you ensure your ability to comply with congressionally 

mandated reports, Leahy vetting, and other requirements? 

3 
49

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24. Please describe, ill detail, the authorities curremly delegated to the Assistant Secretmy offor 

East Asian and Pacific 4ffi;Tirs and or any official in the Bureau below that rank. {/the 

Assi.s·fanl Secrelwy oft he Bureaufbr East Asian and Pacific Affairs hasfia·ther delegated 

that authority, please describe the authority and indicate the responsible official. 

25. Please describe, ill detail, the authorities curremly delegated to the Assistant Administrator 

fix Asia and or any official i11 below that rank. rfthe Assistant Admillislralorfbr Asia has 

.fia·ther delegated that authority, please describe the authority and indicate the responsible 

official. 

[NOTE: No responses to the previous questions were received prior to printing.] 

4 
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26430f-1.eps

Questions for the Record 

Congressman Ami Bera 

"US. Interests in the Asia-Pacific FY 2018 Budget Hearing" 

On July 27, 2017 

Mexico City Policy 

1. Jn Secrelaty Tillerson 's testimony hefbre our commillee, he stated that/he implememation of 

the expanded Mexico City policy was designed to mitigate its impact on the delivery of 

healthcare hy our partners in glohal health. 

To Ms. Thornton and Ms. Steele, prior to the implementation of the expanded Mexico City 

policy, what actions did your organizations take to mitigate the impact of the Mexico City Policy 

on health care delivery1 And what actions did your mganizations take to mitigate the impact of 

the Mexico City Policy on our partner nations and NG0s1 

Ms. Thornton's Response: As directed by the President in his memorandum of January 23, 

2017, the State Department led an inter-agency process, involving USAID, the Department of 

Health and Human Services, and other relevant U.S. government agencies, to develop a plan to 

extend, to the extent allowable by law, the requirements of the 200 I Presidential Memorandum 

on the Mexico City Policy to global health assistance furnished by all departments or agencies. 

On May 15, 2017, the Department of State announced a plan by which US. government 

departments and agencies would effectuate the policy articulated in the President's January 23, 

2017 Memorandum, now known as "Protecting Life in Global Health Assistance" (PLGHA). 

The PLGHA applies to grants and cooperative agreements with foreign non-governmental 

organizations (NGOs) that receive US. funding for global health assistance. Foreign NGOs will 

have the opportunity to indicate their agreement to abide by the PLGHA conditions by accepting 

the provisions in their awards. Departments and agencies will reprogram to other organizations 

any tunding they would have awarded to NGOs that do not agree to the conditions on the 

acceptance of US funding under PLGHA. National and sub-national governments, public 

international organizations, and other multilateral entities in which sovereign nations participate 

are not subject to the PLGHA 

PLGHA does not reduce the amount of global health assistance the U.S. Government makes 

available. The United States remains deeply committed to supporting health programs around the 

world. 

Ms. Steele's Response: As directed by the President in his memorandum of January 23, 2017, 

the State Department led an inter-agency process, involving US AID, the Department of Health 

and Human Services, and other relevant U.S. government agencies, to develop a plan to extend, 

to the extent allowable by law, the requirements of the 2001 Presidential Memorandum on the 

Mexico City Policy to global health assistance furnished by all departments or agencies. On 

May 15, 2017, the Department of State announced a plan by which US. government departments 

and agencies would effectuate the policy articulated in the President's January 23, 2017 

Memorandum, now known as "Protecting Life in Global Health Assistance" (PLGHA). 

The PLGHA applies to grants and cooperative agreements with foreign non-governmental 

organizations (NGOs) that receive US funding for global health assistance. Foreign NGOs will 
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have the opportunity to indicate their agreement to abide by the PLGHA conditions by accepting 

the provisions in their awards. Departments and agencies will reprogram to other organizations 

any tunding they would have awarded to NGOs that do not agree to the conditions on the 

acceptance of U.S. funding under PLGHA. National and sub-national governments, public 

international organizations, and other multilateral entities in which sovereign nations participate 

are not subject to the PLGHA 

PLGHA does not reduce the amount of global health assistance the U.S. Government makes 

available. The United States remains deeply committed to supporting health programs around the 

world. 

2. To Ms. T7wmlon and Ms·. Steele, what .specific actions have your organizations been direc!ed 

to take to monitor the impact of the expanded Mexico City policy 011 the delive1y of healthcare to 

those in need in/he Asia-Pacific? 

Ms. Thornton's Response: The State Department will undertake a review of the effectiveness 

and impact of the policy's application. Newly covered programs, including PEPF AR the 

President's Malaria Initiative, and other global health programs will be given special attention 

under this review. This review, jointly undertaken by State Department, USAID, and interagency 

partners, will provide an opportunity to identify potential changes to the policy's implementation 

or scope, should such changes be needed to address unintended consequences. 

Ambassadors and agency heads in our overseas missions with global health programs, including 

those in Asia, have been notified about implementation of the new policy, Protecting Life in 

Global Health Assistance (PLGHA). USAID has been notifying implementing partners and other 

stakeholders about the policy. Interagency representatives continue to meet regularly to assess 

progress and challenges related to implementing the PLGHA policy. 

Ms. Steele's Response: The State Department will undertake a review of the effectiveness and 

impact of the policy's application. Newly covered programs, including PEPFAR the President's 

Malaria Initiative, and other global health programs will be given special attention under this 

review. This review, jointly undertaken by State Department, USAID, and interagency partners, 

will provide an opportunity to identify potential changes to the policy's implementation or scope, 

should such changes be needed to address unintended consequences. 

Ambassadors and agency heads in our overseas missions with global health programs, including 

those in Asia, have been notified about implementation of the new policy, Protecting Life in 

Global Health Assistance (PLGHA). USAID has been notifying implementing partners and other 

stakeholders about the policy. Interagency representatives continue to meet regularly to assess 

progress and challenges related to implementing the PLGHA policy. 

3. lo Ms. lhomlon and Ms. Steele, have either of your organizations assessed !he potential 

impact of the expanded Mexico City Policy on mothers and children in Asia? Could you please 

provide the resulls of/hal assessment? 

Ms. Thornton's Response: USAID and the State Department began implementing the 

Protecting Life in Global Health Assistance (PLGHA) policy on May I 5, 2017 and are currently 
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working with embassies and missions around the world to review their programs. In addition, 

the State Department will undertake a review of the etl'ectiveness and impact of the policy's 

application. Interagency representatives continue to meet regularly to assess progress and 

challenges related to implementing the PLGHA policy. 

Ms. Steele's Response: USAID and the State Department began implementing the Protecting 

Life in Global Health Assistance (PLGHA) policy on May 15, 2017 and are currently working 

with embassies and missions around the world to review their programs. In addition, the State 

Department will undertake a review of the effectiveness and impact of the policy's application. 

Interagency representatives continue to meet regularly to assess progress and challenges related 

to implementing the PLGHA policy. 

UNFPA 

In April, the State Department decided to withdraw jimding_from the UNFPA under the KempKasten amendment. 

4. ToM~. Thorman and M~. Steele, what was the role of either of your organization in 

contributing to that decision? 

Ms. Thornton's Response: Consistent with the requirements of the Kemp-Kasten Amendment 

and in furtherance of the January 23, 2017 Presidential Memorandum that directed the Secretary 

of State, "to take all necessary actions, to the extent pennitted by law, to ensure that U.S. 

taxpayer dollars do not fund organizations or programs that support or participate in the 

management of a program of coercive abortion or involuntary sterilization," the Department of 

State made a determination with respect to U.S. Government funding for the United Nations 

Population Fund (UNFPA) on March 30. In making this detennination, the State Department 

coordinated with USAID. 

The basis for such action included the fact that China's family planning policies still involve the 

use of coercive abortion and involuntary sterilization and UNFPA partners on family planning 

with the National Health and Family Planning Commission (NHFPC), the Chinese government 

agency responsible for implementing China's coercive family planning policies. 

The Department of State reported on the Chinese Government's coercive family planning 

policies in the 2016 Human Rights Report, and the 2016 Annual Report of the bipartisan 

Congressional Executive Commission on China found that Chinese authorities continue to 

actively promote and implement coercive population planning policies. 

Ms. Steele's Response: Consistent with the requirements of the Kemp-Kasten Amendment and 

in furtherance of the January 23, 2017 Presidential Memorandum that directed the Secretary of 

State, "to take all necessary actions, to the extent permitted by law, to ensure that US. taxpayer 

dollars do not fund organizations or programs that support or participate in the management of a 

program of coercive abortion or involuntary sterilization," the Department of State made a 

determination with respect to U.S. Government funding for the United Nations Population Fund 

(UNFPA) on March 30. In making this determination, the State Department coordinated with 

USAID. 
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The basis for such action included the fact that China's family planning policies still involve the 

use of coercive abortion and involuntary sterilization and UNFPA partners on family planning 

with the National Health and Family Planning Commission (NHFPC), the Chinese government 

agency responsible for implementing China's coercive family planning policies. 

The Department of State reported on the Chinese Government's coercive family planning 

policies in the 2016 Human Rights Report, and the 2016 Annual Report of the bipartisan 

Congressional Executive Commission on China found that Chinese authorities continue to 

actively promote and implement coercive population planning policies. 

5. To M>. Thornton and M>. Steele, what specific actim1s did your or:;anizations take prior to 

the Kemp-Kaslen deierminalion? 

Ms. Thornton's Response: Consistent with the requirements of the Kemp-Kasten Amendment 

and in furtherance of the January 23, 2017 Presidential Memorandum that directed the Secretary 

of State, "to take all necessary actions, to the extent permitted by law, to ensure that U.S. 

taxpayer dollars do not fund organizations or programs that support or participate in the 

management of a program of coercive abortion or involuntary sterilization," the Department of 

State made a determination with respect to U.S. Government tun ding for the United Nations 

Population Fund (UNFPA) on March 30. In making this determination, the State Department 

coordinated with USAID. 

The basis for such action included the fact that China's family planning policies still involve the 

use of coercive abortion and involuntary sterilization and UNFPA partners on family planning 

with the National Health and Family Planning Commission (NHFPC), the Chinese government 

agency responsible for implementing China's coercive family planning policies. 

The Department of State reported on the Chinese Government's coercive family planning 

policies in the 2016 Human Rights Report, and the 2016 Annual Report of the bipartisan 

Congressional Executive Commission on China found that Chinese authorities continue to 

actively promote and implement coercive population planning policies. 

Ms. Steele's Response: Consistent with the requirements of the Kemp-Kasten Amendment and 

in furtherance of the January 23, 2017 Presidential Memorandum that directed the Secretary of 

State, "to take all necessary actions, to the extent pennitted by law, to ensure that U.S. taxpayer 

dollars do not fund organizations or programs that support or participate in the management of a 

program of coercive abortion or involuntary sterilization," the Department of State made a 

determination with respect to U.S. Government funding for the United Nations Population Fund 

(UNFPA) on March 30. In making this determination, the State Department coordinated with 

US AID. 

The basis for such action included the fact that China's family planning policies still involve the 

use of coercive abortion and involuntary sterilization and UNFPA partners on family planning 

with the National Health and Family Planning Commission (NHFPC), the Chinese government 

agency responsible for implementing China's coercive family planning policies. 

The Department of State reported on the Chinese Government's coercive family planning 

policies in the 2016 Human Rights Report, and the 2016 Annual Report of the bipartisan 
54


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Congressional Executive Commission on China found that Chinese authorities continue to 

actively promote and implement coercive population planning policies. 

6. l'o Ms. 1/wrnton and Ms. Steele, what kind of communication did your organizations have 

·with UNFPA prior to the withholding of UNFPAjimding~ 

Ms. Thornton's Response: The State Department engaged UNFPA concerning its China 

program prior to making its determination pursuant to the Kemp-Kasten Amendment. The U.S 

remains an active member of UNFPA's Executive Board and the State Department and USAID 

continue to collaborate with UNFPA in technical areas and communicate with UNFPA on their 

country programs. We will continue to consult closely with UNFPA to carefully assess whether 

UNFP A's programs may continue to warrant the restriction in future years. 

Ms. Steele's Response: The State Department engaged UNFPA concerning its China program 

prior to making its determination pursuant to the Kemp-Kasten Amendment. The U.S remains an 

active member ofUNFPA's Executive Board and the State Department and USAID continue to 

collaborate with UNFPA in technical areas and communicate with UNFPA on their country 

programs. We will continue to consult closely with UNFPA to carefully assess whether 

UNFPA' s programs may continue to warrant the restriction in future years. 

Impact Mitigation of Mexico City Policy and UNFPA Funding 

7. To Ms. 1/wrnton and Ms. Steele, what ;pecijic and tangible actions are your organizations 

laking with nongovernmental organizations and partner nations to mitigate the impact of 

reduced U.S. global health fimding due to proposed budget cuts, the withdrawal of l!Nfl'A 

fimding, and the expanded Mexico ( 'ity policy 1 

Ms. Thornton's Response: The United States remains deeply committed to supporting health 

programs around the world. Preventing child and maternal deaths remains a priority for this 

administration, and we are working to streamline efforts to ensure efficiency and effectiveness of 

U.S. taxpayer dollars. By focusing our efforts on global health programs in maternal and child 

health, nutrition, and malaria we will continue to save the lives of women and children, while 

ensuring that other donors and the host countries themselves contribute their fair share toward 

addressing global health challenges. 

In relation to Protecting Life in Global Health Assistance (PLGHA), relevant departments and 

agencies will reprogram to other organizations any funding they would have awarded to NGOs 

that do not agree to the conditions on the acceptance of U.S funding under PLGHA. PLGHA 

does not reduce the amount of global health assistance the U.S. Government mal<es available, 

and national and sub-national governments, public international organizations, and other 

multilateral entities in which sovereign nations participate are not subject to the PLGHA. 

FY 2017 International Organizations & Program (IO&P) funding earmarked for a contribution to 

UNFPA will be transferred, as required by current law, to USAID's Global Health Programs 

account and reprogrammed for family planning, maternal, and reproductive health activities. 
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Ms. Steele's Response: The United States remains deeply committed to supporting health 

programs around the world. Preventing child and maternal deaths remains a priority for this 

administration, and we are working to streamline efforts to ensure etliciency and effectiveness of 

US. taxpayer dollars. By focusing our efforts on global health programs in maternal and child 

health, nutrition, and malaria we will continue to save the lives of women and children, while 

ensuring that other donors and the host countries themselves contribute their fair share toward 

addressing global health challenges. 

In relation to Protecting Life in Global Health Assistance (PLGHA), relevant departments and 

agencies will reprogram to other organizations any funding they would have awarded to NGOs 

that do not agree to the conditions on the acceptance of US. funding under PLGHA. PLGHA 

does not reduce the amount of global health assistance the U.S. Government makes available, 

and national and sub-national governments, public international organizations, and other 

multilateral entities in which sovereign nations participate are not subject to the PLGHA. 

FY 2017 International Organizations & Program (IO&P) funding earmarked for a contribution to 

UNFPA will be transferred, as required by current law, to USAID's Global Health Programs 

account and reprogrammed for family planning, maternal, and reproductive health activities.