U.S. GOVERNMENT PRINTING OFFICE

65–354 CC WASHINGTON : 2000

U.S. ASSISTANCE COMMITMENTS IN SOUTHEAST

EUROPE

HEARING

BEFORE THE

COMMITTEE ON

INTERNATIONAL RELATIONS

HOUSE OF REPRESENTATIVES

ONE HUNDRED SIXTH CONGRESS

SECOND SESSION

MARCH 9, 2000

Serial No. 106–119

Printed for the use of the Committee on International Relations

(

Available via the World Wide Web: http://www.house.gov/international—relations

(II)

COMMITTEE ON INTERNATIONAL RELATIONS

BENJAMIN A. GILMAN, New York, Chairman

WILLIAM F. GOODLING, Pennsylvania

JAMES A. LEACH, Iowa

HENRY J. HYDE, Illinois

DOUG BEREUTER, Nebraska

CHRISTOPHER H. SMITH, New Jersey

DAN BURTON, Indiana

ELTON GALLEGLY, California

ILEANA ROS-LEHTINEN, Florida

CASS BALLENGER, North Carolina

DANA ROHRABACHER, California

DONALD A. MANZULLO, Illinois

EDWARD R. ROYCE, California

PETER T. KING, New York

STEVE CHABOT, Ohio

MARSHALL ‘‘MARK’’ SANFORD, South

Carolina

MATT SALMON, Arizona

AMO HOUGHTON, New York

TOM CAMPBELL, California

JOHN M. MCHUGH, New York

KEVIN BRADY, Texas

RICHARD BURR, North Carolina

PAUL E. GILLMOR, Ohio

GEORGE RADANOVICH, California

JOHN COOKSEY, Louisiana

THOMAS G. TANCREDO, Colorado

SAM GEJDENSON, Connecticut

TOM LANTOS, California

HOWARD L. BERMAN, California

GARY L. ACKERMAN, New York

ENI F.H. FALEOMAVAEGA, American

Samoa

MATTHEW G. MARTINEZ, California

DONALD M. PAYNE, New Jersey

ROBERT MENENDEZ, New Jersey

SHERROD BROWN, Ohio

CYNTHIA A. MCKINNEY, Georgia

ALCEE L. HASTINGS, Florida

PAT DANNER, Missouri

EARL F. HILLIARD, Alabama

BRAD SHERMAN, California

ROBERT WEXLER, Florida

STEVEN R. ROTHMAN, New Jersey

JIM DAVIS, Florida

EARL POMEROY, North Dakota

WILLIAM D. DELAHUNT, Massachusetts

GREGORY W. MEEKS, New York

BARBARA LEE, California

JOSEPH CROWLEY, New York

JOSEPH M. HOEFFEL, Pennsylvania

RICHARD J. GARON, Chief of Staff

KATHLEEN BERTELSEN MOAZED, Democratic Chief of Staff

MARK GAGE, Professional Staff Member

JOAN I. O’DONNELL, Staff Associate

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C O N T E N T S

WITNESSES

Page

The Honorable James Pardew, Principal Deputy Special Advisor to the President and Secretary of State for Dayton and Kosovo Implementation, U.S.

Department of State ............................................................................................ 8

The Honorable Larry C. Napper, Coordinator for Eastern European Assistance (SEED), U.S. Department of State ............................................................ 10

Dr. Daniel S. Hamilton, Special Coordinator for Implementation of the Stability Pact for Southeast Europe, U.S. Department of State ............................ 13

APPENDIX

Prepared statements:

The Honorable Benjamin A. Gilman a Representative in Congress from New

York and Chairman, Committee on International Relations ........................... 36

The Honorable George P. Radanovich, a Representative in Congress from

California .............................................................................................................. 38

The Honorable Larry C. Napper ............................................................................ 40

The Honorable James Pardew ................................................................................ 56

Dr. Daniel S. Hamilton ........................................................................................... 70

Additional material submitted for the record:

Questions submitted for response by the Administration, submitted by Chairman Gilman .......................................................................................................... 84

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U.S. ASSISTANCE COMMITMENTS IN

SOUTHEAST EUROPE

WEDNESDAY, MARCH 9, 2000

HOUSE OF REPRESENTATIVES, COMMITTEE ON INTERNATIONAL RELATIONS, Washington, DC.

The Committee met, pursuant to notice, at 10:20 a.m., in room

2200, Rayburn House Office Guilding, Hon. Benjamin A. Gilman

(Chairman of the Committee) presiding.

Chairman GILMAN. The Committee will come to order.

It is apparent that the region of Southeast Europe, the Balkans

region, is not only demanding an increasing amount of attention

from policy makers in our government, it is now making a claim

on an ever-greater share of our budget resources.

In the next few days we’ll be introducing legislation which I hope

will help us all to get a handle on just how much of our budget resources will, in fact, be claimed by programs intended to help the

countries of that region over the next few years.

Let me point out that during the last decade the United States

provided roughly $7 billion in foreign aid and debt forgiveness to

the 15 states that now constitute all of Eastern Europe, plus billions of dollars more in funds for peace keeping and military costs

in the Balkans region.

Last year we led our NATO allies in a 3-month military operation against Serbia that cost billions more to our defense budget.

Today we find that our foreign aid budget for just the eight states of Southeastern Europe has ballooned up to well over $1 billion in the last fiscal year.

The President has now submitted a supplemental appropriations

request asking for more foreign aid that would raise our foreign assistance to the Balkans once again to well over $1 billion.

We are informed that the President is now also asking for rough- ly $2 billion more for our defense budget for the cost of our military

deployments in the Balkans.

Finally, the President last year committed our Nation to participate in the multilateral assistance program for the Balkans, the

total cost of which no one seems willing or able to tell the Congress.

All of this comes at a time when the President is asking for large

aid increases to fight the flow of illicit drugs in our hemisphere, to

support the peace process in the Middle East, to fight the proliferation of technology related to weapons of mass destruction, and to

support reforms and protect nuclear materials in nuclear-armed

Russia.

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Last August our Committee on International Relations held a

hearing on our growing American engagement in the Balkans.

Many of our Committee Members took the opportunity raised by

that hearing to send up some cautionary flags regarding the

amount of our taxpayers’ money that would be made available for

the rapidly growing expenses in the Balkans.

As we all know, the European Union has stated that it will take

the lead in carrying the burden in the Balkans. That is, in fact,

what many Members here in Congress would agree should happen.

The legislation that I and other Members of the Committee intend to introduce next week would place a flexible cap on what our

Nation should contribute over the next 5 years to the multilateral

aid program for the Balkans. It is important for our Nation to set

its priorities.

We can continue under such a cap to provide generous aid to the

region. We can, indeed, be very helpful to the Balkan countries

through our continued aid. Our very considerable military costs,

which are not covered by the cap in this legislation, will also likely

continue for some time in the Balkan region.

We must recognize, however, that the prosperous states of the

European Union have taken on the task of leading the multilateral

aid effort in Southeast Europe and should fulfill it.

Setting clear policy on the extent of the role our Nation will play

with regard to foreign aid for the Balkans region should help us

achieve that outcome.

Before I recognize our Ranking Member for his opening remarks,

let me say that I believe our hearing today is timely. The daily

news reports the continuing ethnic strife that afflicts the Balkans.

We now have two U.S. military deployments in that region in support of peace—deployments with no clear end in sight.

Our Reserve and Guard units are being called up for unprecedented, lengthy tours of duty in the Balkans that are having an impact on the morale and lives of our military personnel.

In short, our bills are growing and will continue to grow. Our

hearing this morning is intended to help us understand how much

those bills might finally total.

I’d now like to recognize our Ranking Member, Mr. Gejdenson,

for his opening remarks.

[The prepared statement of Chairman Gilman appears in the appendix.]

Mr. GEJDENSON. Thank you, Mr. Chairman. It does seem a

shame that history will be deprived of our collective wisdom opening this hearing, but I am ready to go ahead anyway.

Chairman GILMAN. We’ll submit our opening statements for the

record, without objection.

Mr. GEJDENSON. Let me just say that I think all of us share the

responsibility to make sure that when the taxpayers’ money is

used, that it is used effectively and that America, while it takes up

its share of responsibility as the leading democracy in the world,

that we make sure that our European allies and other countries,

the developed countries, take on a fair responsibility.

I think it is important to note that when we take a look at American security, we spend about a third of a trillion dollars on defense. That is an important part of our security without any quesVerDate 11-MAY-2000 14:31 Nov 09, 2000 Jkt 000000 PO 00000 Frm 00006 Fmt 6633 Sfmt 6633 65354.TXT HINTREL1 PsN: HINTREL1
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tion, coming from the arsenal of democracy. Our state’s very focused on that part.

We spend about 7 percent of what we spend in the defense budget in the account that deals with the State Department and foreign

diplomacy. It is often hard in the short-term to look at the savings

and the costs involved in these areas.

I frankly think if there’s a place in this budget that the American

taxpayers get a great return—not that we do not make mistakes,

not that we cannot be more efficient—it is in our foreign diplomatic

effort.

We spent over half a century in Germany, we spent over half a

century in Korea with hardware, with personnel, with tremendous

expense to make sure Americans’ interests were defended, that

peace in the world was defended. I think we have to recognize, as

we sharpen our pencils and make sure the Administration is getting the best return for the taxpayers, that what we do in the Baltics and elsewhere in Europe is of immense importance to American security. Whether those East Bloc countries succeed as Poland

and Lithuania, and the Baltic states are succeeding, or whether

they become as Belarus is today, another Stalinist state, is of incredible importance to the United States.

We have made most of Eastern Europe our allies and friends. I

think we have a great opportunity to expand that and even build

a long-term, solid relationship with Russia.

So I think these are important hearings and we ought to make

sure that we recognize that this is all part of America’s economic

and military security.

Chairman GILMAN. Thank you, Mr. Gejdenson.

Is there any other Member seeking recognition?

Mr. Lantos.

Mr. LANTOS. Just a moment, Mr. Chairman, I will not take much

time.

This is a region of the world which in many ways is the most

complex. The failure over the years of our policy makers to grasp

the complexity of Central and Eastern Europe has been an extremely costly enterprise.

At the end of the Persian Gulf War, some of us publicly called

on the Administration of President Bush to issue an ultimatum to

Milosevic indicating that violence, military action, will not be tolerated. Just as we succeeded for two generations from keeping the

mighty Soviet Union from taking military action any place in Europe, tiny Yugoslavia would have heeded such an injunction.

The President, Secretary of State Baker, then Secretary of State

Eagleberger, opposed these suggestions. The result has been close

to 260,000 innocent people dead, and hatreds which are referred to

as historic becoming very current.

It is one thing to be upset about the battle of Kosovo in 1389.

It is another thing to be upset about your wife or daughter being

raped or your son being killed 3 weeks ago.

So we need to move into these areas in a preventive fashion, and

that the Bush Administration failed to do in 1991. Had there been

a clear message to Milosevic, none of these issues would be before

us now. Not the billions and billions of dollars in cost, and not the

quarter million people who are dead. Not the collateral damage of

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shipping on the Danube coming to a halt, basically impacting on

the economy of Romania and Hungary in a very negative way, and

none of the upsurge of anti-American sentiment in Russia because

of our Kosovo activity.

When the history books will be written about the last decade of

the 20th Century, the failure to act intelligently and preventively

in this region will go down as one of the colossal failures of American foreign policy.

Let me just mention in contrast that the initiative taken by my

good friend and colleague Congressman Bereuter and myself in recommending that a small American military contingent be placed in

Macedonia played an indispensable role in preventing the bloodshed from moving over into that small republic.

So I look forward to the testimony of our friends and guests, but

I do so with regret. All of this could have been avoided had the

Bush Administration, at the peak of its popularity following the

victorious conclusion of the Persian Gulf encounter, moved resolutely in Yugoslavia. That failure is the failure we are dealing with

today—the billions we have put into this effort, the vast numbers

of people who have been innocently killed, the destruction of a fabric of a functioning society.

I’ve been going to Kosovo and the region for years on an annual

basis. All of this comes from the notion which is still so prevalent

in this body that somehow we can look away from a problem and

it will solve itself—whether the problem is Colombia today, Kosovo

yesterday, East Timor the other day. We need to take preventive

action, we need to anticipate events, and we must rise above what

are cheap, short-term political considerations of not wanting to get

into this conflict.

Secretary of State Jim Baker said, ‘‘We have no dog in that

fight,’’ Yugoslavia. We had plenty of dogs in that fight, and Jim

Baker made one of the most horrendously irresponsible statements

when he said that.

We have learned in the following 9 years how many dogs we had

in that fight. It is an appalling phenomenon to have a Secretary

of State display this degree of a lack of sophistication in dealing

with an impending crisis which could have been easily prevented.

Thank you, Mr. Chairman.

Mr. BEREUTER. Will the gentleman yield?

Mr. LANTOS. I will be happy to yield.

Chairman GILMAN. Mr. Bereuter.

Mr. BEREUTER. I thank my colleague for yielding or being recognized on my own time here. I was not going to speak, but first of

all, I appreciate the comments of my colleague from California with

respect to what we encouraged the Administration to do in Macedonia, and we are, in my judgment so to speak, not out of the

woods there yet. We need to focus in our bill upcoming on Macedonia as well as Albania.

The gentleman points very much to the Bush Administration,

and frankly, I do not disagree with him in most respects.

It does seem to me that we, the North Atlantic Alliance, were not

ready for the end of the Cold War. Our institutions were not ready

to cope with what happened in Yugoslavia.

5

As a Member then of the House Intelligence Committee, I was

impressed with the quality of the intelligence and the predictions

that we had available to us. We saw the scenario unfold, the disintegration of Yugoslavia and the violence that followed, exactly as

predicted. Policy makers in the Bush Administration, and then in

the Clinton Administration, were unwilling to act on that intelligence.

I do think we needed to have something like we now have—a

Combined Joint Task Force—so that coalitions of the willing could

have taken on that problem at its earliest stage in Yugoslavia. We

did not have that instrument, and Europeans certainly did not

have any stomach for involvement.

In fact, although well-intentioned, the German recognition of

Solvenia’s independence really precipitated the problem that we

saw very shortly in Eastern Croatia between Serbs and Croatians.

The Serbs were concerned about the protection of the Serbian

ethnics living in that part of Croatia. That, I think, was the time

when we should have used force and could have used it effectively.

But we didn’t. There’s a lesson I think we also need to learn out

of that, my colleagues. As difficult as it is for Americans to accept

this fact, sometimes there are things that are more important than

self-determination. The continued solidarity of the Yugoslavian

state was more important than the understandable desire of Slovenians to have independence because ultimately, it precipitated in

a matter of days a Croatian demand for a declaration of independence. Then we were off to the violent races.

That’s a lesson we need to learn, and it applies in places in Africa as well. Sometimes there are things that are more important

than self-determination.

I thank my colleagues for listening, and now I’d like to see if we

have something to hear from our witnesses. Thank you.

Chairman GILMAN. Thank you, Mr. Bereuter.

Ms. Lee.

Ms. LEE. I will be very brief.

Thank you, Mr. Chairman.

First let me just say it is no secret where I was in terms of how

I viewed the military bombing of Kosovo. However, I do understand

that it is our responsibility that when the United States takes military action we must assume a responsibility to help rebuild. That’s

the price that we must pay.

My concern is at whose expense and in what region of the world.

We’ve got critical needs and issues in Africa, Latin American, and

the Caribbean, so I am very anxious to hear from our witnesses to

see how this is going to evolve.

Thank you very much.

Chairman GILMAN. Thank you, Ms. Lee.

If there are no other Members seeking recognition I am going to

recess our hearing until the vote is over. Hopefully our reporter

will get the equipment moving by the time we return.

The Committee stands in recess.

[Recess.]

Mr. ROHRABACHER [presiding]. This hearing is called to order. I

will be temporarily in the Chair until Mr. Gilman or Mr. Bereuter

returns.

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Mr. Radanovich has a short opening statement.

Mr. RADANOVICH. Thank you, Mr. Chairman, for holding this important hearing today.

As we are looking at exit strategies for the U.S. forces in the Balkans, let me make this one point. Democratization of Southeast Europe is one of the most important interests, and maybe even more

so for our allies in the European Union and NATO.

Every year U.S. taxpayers see their hard-earned dollars going toward ensuring peace in this region. Without democratization and

economic prosperity there, our soldiers will remain perhaps for

many years.

By supporting Croatia’s membership in NATO’s Partnership for

Peace program, and its accession into the World Trade Organization, we will not only be making a sound investment in the future

stability of Southeast Europe, but we will also be sending a clear

message to other countries in the region of the benefits that come

from choosing a democratic path.

Toward that end, I recently introduced H. Con. Res. 251, a resolution that both congratulates Croatia on its democratic elections

and calls for U.S. support and facilitation of Croatia’s goals for

membership in the Partnership for Peace and the WTO.

Croatia was so clearly a loyal and valuable ally to the United

States during the Kosovo crisis, and I believe it deserves commendation for its stand with the United States and NATO during

Operation Allied Force and SFOR.

Croatia also needs direct investments, and I am thrilled about

the opening of OPIC’s office in Zagreb last week. I am sure this

will prove to be beneficial to both sides. It will promote U.S. exports and encourage small business to flourish in Croatia, which

will also help reduce unemployment in Croatia considerably.

This year’s U.S. assistance for Croatia is also critical for refugee

return, and we must make sure that this assistance includes all

ethnic groups.

Clearly, if economic prosperity is enhanced and returning refugees see the opportunity to work, they will return more quickly and

in greater numbers.

Recently, Secretary of State Madeleine Albright commented on

Croatia in an interview to Radio Free Europe. She said the recent

democratic changes in Croatia are strong and exciting. She also

said that the additional assistance has been announced, and that

the U.S. is going to look directly at other ways to help Croatia.

I would like to ask just a couple of questions, and to get the answers in writing would be just fine—that is, if this distinguished

panel could comment on what the Administration meant when it

said that we are looking at other ways to help Croatia.

I would like to hear in more precise terms what U.S. assistance

will consist of. Would you estimate that this is the right moment

to reward Croatia’s contribution to the success of the U.S.-NATO

Operation Allied Force and SFOR? What might be the timeframe

for that? Again, answers in writing would be just terrific. I’d appreciate it.

Thank you, Mr. Chairman.

Mr. GEJDENSON. Will the gentleman yield?

Mr. RADANOVICH. Yes.

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Mr. GEJDENSON. I’d just be curious to hear from our panelists if

they can calculate what would happen to that assistance if, say, a

cap was placed at 15 percent on aid to the region, and what that

would do to programs like the one in Croatia?

Thank you.

Chairman GILMAN. [Presiding] If we could hold that until we get

to our questions.

Thank you, Mr. Radanovich.

Mr. Rohrabacher.

Mr. ROHRABACHER. I will make this very quick, and thank you,

Mr. Chairman.

Let me echo the praise of Mr. Radanovich about Croatia. It is

something we should not overlook. Croatia had a democratic election during this turmoil, and not only did it have a democratic election, but the opposition party won and power has been transferred.

This is a tremendous success for the cause of democracy and something that we should not forget.

Furthermore, Croatia during the time period—this time period

when there was this conflict and tensions were high and people

were polarized—permitted some of their soldiers who had committed war crimes during the conflict to go and stand trial and to

face justice, and several were convicted. That should not be looked

at as a negative thing about Croatia, it should be a positive thing.

The fact is that the war criminals are still in power in Serbia.

The Croatians had a free and democratic election and sent their

people that they thought might have committed crimes to face justice.

So I would put my name on Mr. Radanovich’s bill, first of all as

a cosponsor.

But with that said, let me note that it took a long time for the

United States of America to decide who were the bad guys down

there—a long time.

Furthermore, I will just end it with this and say I do not think

the United States has to pick up the lion’s share of the cost for

these type of operations, either ongoing or in the future. I want to

know about why we are having to shoulder the military cost, and

how much that was; and I want to know how much after the military action it is costing us now.

We were told we were going to get out of the Balkans for just

a couple of billion dollars and within a year or two. It has been

many years now and it has cost us many billions of dollars. It is

not realistic to think the United States and the people of the

United States can continue carrying that load after the Cold War

is over.

Thank you very much.

Chairman GILMAN. Thank you, Mr. Rohrabacher.

Now that the malfunctioning stenographic equipment has been

repaired, I am going to ask the stenographer to make certain that

the opening statements are fully recorded.

We’ll now turn to our witnesses for their testimony.

Ambassador Larry Napper now serves as Coordinator of Assistance to Eastern Europe after a long career with our State Department.

8

After serving with the U.S. Army, Ambassador Napper joined the

Foreign Service and rose to a number of important positions with

our diplomatic corps, including key positions at our Embassy in

Moscow, Deputy Chief of Mission at our Embassy in Romania, Director of the Department’s Office of Soviet Union Affairs, and Ambassador to Latvia.

Ambassador Napper has also served as a Congressional Fellow

with our former colleague Congressman Lee Hamilton in 1983 and

1984.

It is good having you back before the Committee once again, Mr.

Ambassador.

Ambassador James Pardew was appointed to his current position

last year after having been appointed to the rank of Ambassador

in 1997. Ambassador Pardew has a long record of service with our

military from which he has a number of decorations.

Among other positions, Ambassador Pardew served with the staff

of the Joint Chiefs and the Army General Staff and completed a

number of foreign tours of service.

Ambassador Pardew served as a representative of the Secretary

of Defense at the 1995 negotiations on the Dayton Accords for Bosnia. Then he served as Director of the military ‘‘Train and Equip’’

program in Bosnia from 1996 to 1999.

Dr. Daniel Hamilton is our country’s Special Coordinator for the

President’s Southeast Europe Initiative and Implementation of the

‘‘Stability Pact’’ multilateral aid program for Southeastern Europe.

Having served as Deputy Director of the Aspin Institute in Berlin

from 1982 to 1990, and then as Senior Associate for EuropeanAmerican Relations at the Carnegie Endowment for International

Peace from 1990 to 1994, Dr. Hamilton took up new responsibilities

for the State Department’s policy planning staff as an advisor to

our U.S. Ambassador to Germany and as an Assistant Secretary for

European Affairs starting in 1994.

He now continues to serve as Associate Director of the Policy

Planning Staff while fulfilling his responsibilities with regard to

Southeast Europe.

Gentlemen, we welcome you and we appreciate your taking the

time from your busy schedules to appear before the Committee

today. You may summarize your written statements which, without

objection, will be included in the record. Please proceed in whichever order you desire.

STATEMENT OF AMBASSADOR JAMES W. PARDEW, JR., PRINCIPAL DEPUTY SPECIAL ADVISOR TO THE PRESIDENT AND

SECRETARY OF STATE FOR DAYTON AND KOSOVO IMPLEMENTATION, U.S. DEPARTMENT OF STATE

Ambassador PARDEW. Thank you, Mr. Chairman. I am very

pleased today to testify on the U.S. assistance programs for Southeastern Europe. I do have a longer statement which I will submit

for the record.

Chairman GILMAN. Without objection, it will be made part of the

record.

Ambassador PARDEW. I will briefly summarize our overall policy

as a framework for U.S. assistance programs, the goal of our programs, our successes and challenges that we face as we go forward.

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Ambassador Napper will speak on the specific aspects of our assistance programs, including the supplemental. Dr. Hamilton will address the Stability Pact for Southeastern Europe.

Our assistance programs in the Balkans are directly linked to

our fundamental interests there. As I’ve testified before this Committee before, that fundamental interest is regional stability.

Military forces are not the solution to long-term stability in the

region. They are certainly not the most cost-effective way of providing long-term stability.

Rather, stability requires robust political and economic programs

backed by sufficient resources to make the difference.

In pursuit of our interests we’ve made considerable investments

in civilian programs in the Balkans in the past few years. These

investments have produced important returns which support our

overall goals.

In Croatia we share your enthusiasm and excitement about recent events. Recent elections promise dramatic transition to democratic governance, market reforms, and full partnership with European and international institutions.

It is now possible to quickly open doors that were closed for so

long for Croatia. PFP membership, membership in the international organizations, and greater financial assistance are open

based on performance and support to the Dayton peace process.

Since 1995, 600,000 refugees have returned to their homes in

Bosnia, and last year 800,000 refugees returned in Kosovo. Humanitarian aid helped get them through the winter.

We have caused reductions in many military forces in the area,

transformed the Kosovo Liberation Army, held elections in Bosnia,

and plan to hold elections in Kosovo this Fall.

Throughout the region, along with our allies, we sponsored democratic processes and institutions, economic reforms, policy and judicial reforms, anti-crime programs, and independent media development.

We also are using assistance to bolster the democratically-elected

government in Montenegro against pressures from Belgrade.

In Serbia we are tightening financial sanctions and expanding

the visa list, and supporting Serb opposition in an effort to change

the regime in Belgrade.

The job of stabilizing the region is not complete, however. We

continue to face challenges every day. Hard-line nationalists in

Bosnia remain in positions of influence. Kosovo remains an unstable and dangerous place. Milocevic continues to cause difficulties in

Montenegro, Kosovo, and Bosnia. The transition to democratic and

economic reform is simply not complete.

I must highlight, in summary, the problem of crime and corruption as destructive forces which cross-cut the region and threaten

the development of democratic institutions and reform. We have

both bilateral and regional initiatives to tackle this serious problem.

In Fiscal Year 2000, our bilateral SEED assistance to Southeast

Europe is $516 million to fund political, economic, police and judicial reform, and humanitarian aid—the keys to long-term stability.

Additionally, the Administration has requested supplemental

funding for Southeast Europe for this year. This funding is critical

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if we are to move our objectives forward in the region and provide

adequate and secure facilities for our diplomats who work in difficult and often extremely dangerous conditions.

We are clear and consistent with our European allies that Europe must pay the lion’s share of the financial burden in the region,

and they have acknowledged this responsibility. In fact, the Europeans have pledged $731 million for Kosovo this year, which

amounts to 60 percent of the pledges for Fiscal Year 2000.

The U.S. share of this spending amounts to 13.9 percent.

On police, European and Canadian commitments account for 40

percent of the personnel. The U.S. pledge accounts for a little over

12 percent.

We clearly understand the message from Congress on burden

sharing and we will continue to work with you in that regard.

Mr. Chairman, we certainly wish to work with the Congress on

burden sharing further, and we look forward to receiving your bill

and reviewing it carefully.

The issue of flexibility which you mentioned is extremely important. We believe that restrictive caps which limit our flexibility are

not a good idea.

Now, Mr. Chairman, let me turn to Ambassador Napper who will

speak to you on the details of the supplemental.

[The prepared statement of Ambassador Pardew appears in the

appendix.]

Chairman GILMAN. Thank you, Ambassador Pardew.

Ambassador Napper.

STATEMENT OF AMBASSADOR LARRY C. NAPPER, COORDINATOR FOR EASTERN EUROPEAN ASSISTANCE (SEED), U.S.

DEPARTMENT OF STATE

Ambassador NAPPER. Thank you very much, Mr. Chairman. I do

appreciate the opportunity to speak with you and the Committee

again on the state of the SEED Program in Central and Eastern

Europe.

Building upon the success of that program over the past decade,

the President has proposed $610 million in SEED funding for Fiscal Year 2001. This request focuses on Southeast Europe, a region

which, as Ambassador Pardew has suggested, remains a region in

transition where U.S. vital interests are at stake.

In addition, the President has submitted a supplemental request

for Fiscal Year 2000 funding in Southeast Europe. Given the urgency of this request, we do ask that Members of Congress support

the rapid approval of this vitally needed additional funding.

The supplemental requests $624 million in non defense funds for

the following purposes: $194.5 million in SEED funding for Croatia, Montenegro, Kosovo, and Serbia democratization; $22 million

in USAID operating expenses; $31 million in foreign military financing to help PFP countries implement reforms to facilitate their

cooperation with NATO; $2.875 million in international military

education and training; $239 million for the construction of secure

diplomatic facilities in Tirane, Sarajevo, and Pristina; $24 million

in diplomatic and consular presence funding for the State Department’s on-the-ground presence in the region; $107 million in contributions to international peace keeping activities to cover our asVerDate 11-MAY-2000 14:31 Nov 09, 2000 Jkt 000000 PO 00000 Frm 00014 Fmt 6633 Sfmt 6633 65354.TXT HINTREL1 PsN: HINTREL1
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sessed costs in Kosovo and also in East Timor; $3.622 million in

education and cultural exchanges.

Mr. Chairman, the President’s supplemental request contains $92.8 million in SEED funds for Kosovo. If approved by Congress,

this would bring the total SEED appropriation for Kosovo to $242.8

million in 2000.

In addition to this vital SEED funding, we urge Congress to fully fund the President’s request for $107 million to cover our assessed

contribution for U.N. peace keeping costs.

The recent events in Mitrovica underscore that both the SEED

and peace keeping funds are essential to support UNMIK’s efforts

to establish public order, assure protection of human rights, and

begin the process of economic recovery.

UNMIK’s success in these areas is vital to ensure that U.S.

forces can accomplish their mission in safety and security.

U.S. commitments in Kosovo represent our fair share of a broader effort in which our European partners play the leading role.

European countries and the European Commission pledged more

than 70 percent of the contributions to the Kosovo budget already

pledged, and have disbursed more than 70 percent of the voluntary

contributions received by UNMIK.

In the broader perspective, our European partners pledged 61

percent of the total amounts pledged up to now for Kosovo reconstruction in Fiscal Year 2000, and other non-U.S. donors pledged

another 25 percent of that total.

As Ambassador Pardew has suggested, our own percentages with

regard to the Kosovo budgets—13.4 percent for police, 12.1, and the

overall for Kosovo reconstruction and recovery 13.9 percent, so

that’s a very good burden sharing story.

I want to support the remarks by Mr. Radanovich and Mr. Rohr- abacher concerning Croatia. The President’s request contains $35.7

million in supplemental SEED funding for Croatia, and if approved, this would bring the total funding for that country to $50.8

million in Fiscal Year 2000.

The recent Croatian elections and the subsequent formation of a

new government led by the opposition are the most hopeful developments in the Balkans since Dayton.

The initial actions of the new government give us confidence that

the change in Zagreb is real and profoundly hopeful.

We have a historic opportunity here. With our support Croatia

can go from a problem to a partner in the pursuit of a broad regional peace.

Mr. Chairman, the President’s request also contains $34 million

in supplemental funding for Montenegro. It is imperative that our

assistance in Fiscal Year 2000 keep pace with Montenegro’s needs

as its democratically-elected government struggles to cope with unrelenting psychological and economic pressure from Belgrade.

With the support of the Congress, the President’s supplemental

request for Montenegro would allow us to meet both urgent requirements for budget support and essential longer-term developmental needs.

If Congress approves the President’s supplemental request, total

SEED funding available for Montenegro in Fiscal Year 2000 would

be $58 million.

12

The United States must also continue and broaden its support

for the opposition to Milosevic within Serbia. American support encourages the Serbian opposition to come together around common

goals of promoting democracy, building a market economy, and establishing the rule of law.

We have allocated $25 million in SEED funds to support this

process in Fiscal Year 2000. The President’s supplemental budget

request of $15 million would enable us to provide robust democratization assistance to Serbia’s democratic opposition, and to help

that opposition begin to prepare for a Serbia after Milosevic is

gone.

The current crack down on the Serbian opposition underscores

the fact that those who have the courage to stand up to Milosevic

expect and deserve our support.

Finally, the President’s supplemental request contains $17 million in supplemental SEED funding for regional programs in

Southeast Europe. These funds are needed to support small and

medium enterprise, and to increase the effectiveness of our existing

efforts to fight organized crime in Bosnia, Kosovo, and Albania, as

Ambassador Pardew has suggested.

If approved, the supplemental request would bring total SEED

funding for regional programs in Southeast Europe to $106.87 million.

Mr. Chairman, I recently returned from a trip to Southeast Europe, including visits to Kosovo, Croatia and Macedonia.

I had the opportunity to see firsthand how our Embassies and

USAID missions are using SEED funds to accomplish vital U.S.

foreign policy objectives. Our people in the region often work in difficult and dangerous conditions. We owe them the support that

would be provided by full funding of the President’s request for

State and USAID operating expenses, and the construction of secure diplomatic facilities in Pristina, Tirane, and Sarajevo.

President Clinton’s supplemental request for 2000 and budget request for 2001 are essential to implement peace and overcome the

terrible legacy of ethnic cleansing in Kosovo and elsewhere in this

troubled region.

This funding would enable us and our partners to build a brighter future and to serve U.S. interests by taking full advantage of

hopeful new developments, such as the new government in Croatia

and the emergence of the Stability Pact. That is why we would welcome early Congressional enactment of the President’s proposal for

supplemental SEED funding for 2000, as well as the Administration’s 2001 budget request.

Mr. Chairman, I do have a longer statement and I would appreciate it being introduced in the record. Thank you.

[The prepared statement of Ambassador Napper appears in the

appendix.]

Chairman GILMAN. Without objection, the full statement will be

included in the record.

Thank you, Ambassador Napper.

Now we’ll turn to Dr. Daniel Hamilton, with regard to the implementation of the Stability Pact.

Dr. Hamilton.

13

STATEMENT OF DR. DANIEL S. HAMILTON, SPECIAL COORDINATOR FOR IMPLEMENTATION OF THE STABILITY PACT

FOR SOUTHEAST EUROPE, U.S. DEPARTMENT OF STATE

Dr. HAMILTON. Thank you, Mr. Chairman and Members of the

Committee for the opportunity to testify on our efforts to stabilize

Southeastern Europe.

I want to complement the presentations made by Ambassadors

Pardew and Napper by focusing on our cooperation with our European partners through a Stability Pact for Southeastern Europe,

which we believe is an important vehicle to bring lasting peace and

prosperity to the region.

I also have a longer statement which I’d like to submit for the

record, and I will simply summarize it here.

Chairman GILMAN. Without objection.

Dr. HAMILTON. Thank you.

Mr. Chairman, over the past decade there has been a bipartisan

effort on the part of the United States to create what President

Bush called a ‘‘Europe whole and free,’’ and President Clinton has

called a ‘‘peaceful, undivided, democratic Europe.’’ That Europe is

truly within our grasp, but it is not there yet because we still need

to stabilize Southeastern Europe.

This Europe is within our grasp, however, because 50 years ago

we recognized that the strategic challenge facing the United States

in Europe was to defend Europe itself and transform Western Europe. Countries that we had talked to having ancient animosities

at that time, and that had dragged the United States into successive wars.

Because of our success there, after the Cold War we were able

again, in a bipartisan manner, to turn to stabilize Central and

Eastern Europe. Through our efforts, through NATO enlargement,

through the EU’s own efforts, and through such efforts as the U.S.-

Baltic Charter, that part of Europe is also on track and is stable.

We would argue that our core strategic challenge again today is

to stabilize Southeastern Europe, to do in many ways what we had

done previously. Due to our earlier success, we have strong and

prosperous partners to help us do the job. Our European allies,

particularly the European Union should take on the lion’s share of

this effort. They have agreed with that. The President and Secretary Albright have insisted upon it. We believe that will, in fact,

be the case, and that the Stability Pact for Southeastern Europe

can be a vehicle to advance that bargain.

The Stability Pact boil-down is really a bargain between integration and reform.

We and our European allies and other institutions—international

institutions, international financial institutions—agree to stabilize,

transform, and work on a long-term plan to integrate the countries

of this region into the European and trans-Atlantic mainstream.

The countries of the region, in turn, have agreed to work individually and together more than before to create the conditions by

which that can be possible—in economic terms, through economic

reforms; in security terms, through security cooperation; and by

promotion and consolidation of democracy and human rights

throughout the region.

14

We have been working since the Sarajevo Summit, which

launched this pact last summer, to work ahead on specific elements

of the bargain. As I said, there are three baskets, if you will—security, economics, and democracy/human rights. We have some early

signs of success in that area.

Just briefly, on the economic area. The international financial institutions—the World Bank, the European Bank for Reconstruction

Development, the European Investment Bank—have all now devised regional strategies for Southeastern Europe which they had

not before.

They all support the goals of the Stability Pact, and each of them

are committing or are looking at commitments on their part for further financing for projects throughout this region.

All the countries of the region through the Stability Pact have

agreed on what we call an investment compact. That is, to commit

to country-specific action plans—we have an action plan before

that—on what they will do to create a climate conducive to private

investment.

In the end, it is private sector, private investment, not assistance

that will transform this region. What we are doing through the

Stability Pact is creating the conditions conducive to private enterprise, not just foreign investment, but domestic investment as well,

and each of the countries in the region have agreed now through

this plan and through a mechanism that we have to work on concrete action steps to create that kind of environment.

We have also created a business advisory council for the region

which consists of U.S., West European and companies from the region itself, that will work directly with each country in the region

on private sector advice and what needs to be done to transform,

again, their investment climates.

In the security area, the main issue that is focused on this region

has been corruption. As Ambassador Pardew said, we have been

very focused on this issue, and that U.S. initiative—all the countries of the region through the Stability Pact have agreed to what

we call an Anti-Corruption Initiative. It is not just a piece of paper.

It outlines commitments of these countries and has an Action Plan

to be implemented country-by-country on what these countries will

do to fight corruption. It is tied to specific steps, and we have an

implementation mechanism, again, country-by-country to work on

that as well.

The countries of the region have also signed a Memorandum of

Understanding that has created a regional Customs Directors Association which will facilitate a World Bank loan that’s been prepared

by the Southeast Europe Cooperative Initiative to upgrade border

crossings and revamp the Customs services of the entire region,

which I am sure many of the Committee Members know has been

an issue in terms of corruption and other elements. We are trying

to marry the anti-corruption elements with reform of Customs facilities throughout the region.

The countries of the region, through the Stability Pact, have all

agreed on efforts to control, seize, and destroy small arms and light

weapons throughout the region. They have agreed to work on aligning their arms export policies with major European and interVerDate 11-MAY-2000 14:31 Nov 09, 2000 Jkt 000000 PO 00000 Frm 00018 Fmt 6633 Sfmt 6633 65354.TXT HINTREL1 PsN: HINTREL1
15

national standards, and to devise a common end-user certificate

through the region so that such exports can be tracked.

They have all signed on to a declaration confirming their commitments to implement conventions against weapons of mass destruction and have all agreed—including I note, the Bosnian Serbs—

have all agreed and called on the Federal Republic of Yugoslavia

to accede to the chemical weapons convention.

In the area of democracy and human rights, the country’s experts

from around the region have agreed to examine their history. We

think an important development that they have said together, they

will stand together and use historians and their education ministries to review textbooks with a view to eliminating bias and prejudice, to have an ongoing series of efforts to review history

throughout the region.

We think it is an important development, and we would like to

continue to support it.

We are working through the Stability Pact on the promotion of

free and independent media through the region as well.

Hungary has taken an important initiative called the ‘‘Szeged

Process,’’ which is to link efforts to support the Serb opposition by

working with Serb opposition mayors in various countries in Serbia. It has been a helpful initiative that we support.

As I mentioned, the President and the Secretary fully expect, and

our European colleagues have agreed, that Europe must take on

the lion’s share of this effort.

The European Union in December took some important steps in

that regard by announcing that they would begin, and they have

since begun, accession negotiations with Romania and Bulgaria, in

addition to Hungary and Slovenia, which were already on track.

They have agreed that Turkey is a candidate for European Union

membership. They have taken the further steps that are needed to

implement their financial commitments.

President Prodi of the European Commission has announced that the European Commission would devote $11.5 billion euros to this

region over the next budget cycle of 7 years. We think that’s an important pledge. You can believe we are working on holding our colleagues to that.

If you step back just briefly and look at other things that have

been achieved, and why the Stability Pact—what’s the value added

of this effort? Let me give you just two examples.

Bulgaria and Romania had disagreed for 10 years over a bridge

over the Danube, which created a 500-kilometer detour for road

traffic. They could not agree on the location or the financing.

Through the Stability Pact, they have now agreed on both with

no U.S. financial commitments involved. These are totally European commitments. We believe it is a significant development. It

helps not only close that 500-kilometer gap, but starts to link these

countries again with the European mainstream.

Commission Member Chris Patten recently announced, and we

have, I think, an announcement today as well, a resolution of the

congestion at the Blace border crossing between Macedonia and

Kosovo. Again, through the auspice of the Stability Pact, we have

devised a way to relieve that congestion and get a regional cooperation mechanism in place in that area.

16

The last one I would just mention is that NATO and the World

Bank in a unique partnership, have agreed on demobilization and

training of retired military officers throughout the region. If you

will ask officials from those two institutions, they never would have

come together in this kind of partnership if it hadn’t been through

the good auspices of the Stability Pact.

Our goal now is to take these pledges and these early signs of

success and turn them into on-the-ground realities to make a difference in people’s lives so that they see that this is not just an abstract international gathering, but something that makes a difference.

We try to aim to advance both parts of our bargain—reforms by

the countries and commitments by the international community—

at a regional conference scheduled to be held at the end of this

month on the region as a whole. We do believe that the international financial institutions and the European Union will pledge

significant figures toward what they call a quick-start package of

regional infrastructure projects and projects in the areas of democracy and human rights.

They are matching the funding to the projects that have been

proposed through the region now, so the exact figures simply are

not there, but they should be available very soon. I believe we will

certainly be in touch with the Congress as we know that, and certainly, Ambassador Napper and I would like to continue to be in

touch with the Committee staff about the details of that as it

evolves.

The Stability Pact is really an effort in crisis prevention as was

mentioned by a number of Members earlier. Crisis prevention is

cost prevention. With the Stability Pact we can transform what has

been a primary area of instability throughout this region into a stable and prosperous part of the mainstream of Europe and the

trans-Atlantic community.

We are not naive enough to believe this will happen easily or

quickly, but we do believe it is a core strategic challenge that we

must engage in because we have looked, and as I said, we have

learned history’s lesson. American failure to invest in defending

American vital interests in Europe has always meant we have paid

a higher price later. That was the lessons of the last century in Europe, and is one we are trying to avoid and learn from today.

Thank you.

[The prepared statement of Dr. Hamilton appears in the appendix.]

Chairman GILMAN. Thank you, Dr. Hamilton.

We’ll now proceed with a few questions.

Gentleman, in a recent meeting with our Committee staff on the

issue of aid for Southeast Europe, a State Department representative stated that the President would not provide any statement of

intentions as to how much our Nation would pledge or commit to

aid in the region over the next 5 or 6 years. Of course after the

Dayton Accords and the NATO deployment in Bosnia, the President clearly stated that what the U.S. wanted to pledge and commit as part of a multilateral aid package for that country over a

4-year period.

17

As representatives for the President’s implementation of the multilateral aid package for the Southeast Europe region, an aid package to which the President committed our Nation at the Sarajevo

summit last July, can you please tell us why the Congress will not

be provided with an outline of just how much the Executive Branch

wants to pledge and commit to any multilateral aid package for the

Balkans so that the Congress may assess the future pattern of the

appropriations challenges in our overall foreign aid program?

Any of our panelists? Ambassador Napper.

Ambassador NAPPER. Mr. Chairman, thank you for the question

and I appreciate it. It is a good one. Obviously the Congress would

like to know something of the Administration’s intentions, and I

hope we’ve laid those out to the degree we can today.

If you look at the 3-year pattern of the last fiscal year, this fiscal

year, and the President’s budget request for 2001, I think it does

give you a sense of where we are headed.

We went from a level of $430 million, for instance, in the SEED

program in Fiscal Year 1999 to a budget this year of $533 million.

If we did get the supplemental which the President has requested,

the level after that supplemental, if we got it fully, would be $727.5

million. For 2001 we’ve requested $610 million.

So as you can see here, we are not talking about a progression

of at least the SEED assistance. I think the SEED Program is

something of an accurate barometer for the entire effort in Southeast Europe. We are not talking about a program here which is on

an ascending scale off the charts. We are talking about relatively

moderate increases which have been necessary because of the

events that have transpired on the ground in order to respond, and

where possible to anticipate these developments in a very turbulent

region.

Precisely because it is a turbulent region and very difficult to

read, it is very difficult to project out beyond that 3-year cycle of

funding and to begin to talk about exactly where the program will

be. To begin to give you figures for 2002, 2003, or 2004 simply

seems to us not to be the most responsible behavior for the Administration at this juncture.

I guess that would be my response, Mr. Chairman. We tried to

give the lay of the land as we see it to your staff and to the Committee, and I think that would have to be my response at this juncture.

Chairman GILMAN. Thank you, Ambassador Napper.

Any other panelists care to comment on that issue?

Ambassador Pardew.

Ambassador PARDEW. Mr. Chairman, I would only like to add

that it has been extremely difficult for us to project the direction

that this would go in the out years, but to the degree that we’ve

had success, we’ve also been very careful to reduce our commitments.

For example, we started in Bosnia with 60,000 NATO and allied

troops. I forget the original number of U.S. troops, but it was about

20,000. That number has declined to where we’ll have about a total

of 20,000 international troops in Bosnia this year. The U.S. commitment will be less than 5,000.

18

Our SEED and other spending has been on the decline as well

as we have achieved some success in implementing the Dayton

Agreement. But it is very difficult, we could not see Kosovo coming,

so in some cases it is just impossible to project future requirements.

Chairman GILMAN. What’s the number of our troops now, Ambassador Pardew?

Ambassador PARDEW. The total number of NATO and allied

troops will be around 20,000 this Spring.

Chairman GILMAN. How about U.S. involvement?

Ambassador PARDEW. The U.S. percentage of that is 4,600. Our

total percentage of SFOR is 23 percent.

Chairman GILMAN. Are we proposing to reduce our troops——

Ambassador PARDEW. We have reduced them down to those numbers, and we’ll reassess from that level, Mr. Chairman, as to

whether or not there should be further reductions.

Chairman GILMAN. When will that reassessment take place?

Ambassador PARDEW. There is to be a review in NATO probably

in the Fall.

Chairman GILMAN. So until then we’ll stay at the 4,600 level?

Ambassador PARDEW. That’s the plan. Yes, sir.

Chairman GILMAN. Thank you.

The already-enacted Fiscal Year 2000 Foreign Operations Act requires the Secretary of State to certify that our Nation has pledged

no more than 15 percent of the total resources pledged by all donors of assistance to the Kosovo region. The Secretary has, in fact,

already provided such a certification to Congress.

Why would a certification that our Nation has pledged no more

than 15 percent of all resources pledged by all donors for the entire

region of Southeast Europe prove a problem for our Secretary, or

would it not be a problem for her ability to provide such a certification for the region?

Ambassador NAPPER. Mr. Chairman, you’re exactly correct that

the Secretary did certify that, but let me explain the provision and

the context.

The provision in the appropriations bill applied to one donor’s

conference for Kosovo which took place in November of last year.

The provision was that the Administration could not expend funds

for Kosovo until the Secretary of State had certified that our contribution at that donor’s conference was no more than 15 percent,

and we did so. That was an event in time which took place once

and could be therefore relatively easily certified.

The problem with a cap of this kind that would extend into the

future is precisely the uncertainty of the world, and especially that

part of the world where you have a constant train of unpredictable,

unforeseen events. I would personally be very concerned as the responsible official for at least the SEED part of the account that we

would not be able to respond to new challenges such as Kosovo or

new opportunities such as Croatia.

A couple of the Members have expressed how important it is to

move quickly on Croatia and we agree 100 percent. If we’d been

limited by a cap on what we could have put into Croatia immediately, we would not have been able to take care of that opportunity. So that would be my response, Mr. Chairman.

19

Chairman GILMAN. Thank you Ambassador Napper.

We appear to be suffering from some further technical problems

in that our timing system is not working. I’ve asked our staff to

keep track of the time and I will advise Members when their time

has expired.

The last question. The European Union has announced that it is

going to provide about $12 billion in direct assistance over a 6-year

period to the countries of Southeast Europe, which may not be that

much of an increase in aid to the region by the EU. Does that $12

billion figure include expected aid donations by the EU member

states? If not, how much do you expect might be provided by those

individual states over a 5 or 6-year period to aid the countries of

Southeast Europe, and what other amounts of aid to the region

other than that from EU or U.S. do you expect might become available to that region, such as aid from Japan or the World Bank?

Dr. HAMILTON. Mr. Chairman, the pledge to which you referred

is the pledge by President Prodi of the European Commission’s

next budget cycle to the region, so it is limited to the finances by

the Commission itself.

We fully expect that EU member states will add significantly to

that figure. They go through their respective budget cycles. Most

of them do not do multiyear budgeting, so it is hard to do the same

projection for each EU member state as the Commission has done

through its cycle.

We do, however, know for instance that the German government,

and this has been a public statement, has said that they intend to

invest 1.2 billion marks for the region in support of the Stability

Pact over the next 4 years. This would translate into $300 million

marks a year over this period.

The Dutch government has made similar statements. I hesitate

to go into the specifics because they have to go through their own

parliamentary processes as well.

What we are trying to do is ascertain the exact levels in advance

of this regional conference, so that at the regional conference we

fully expect EU member states and the Commission to be able to

say what they will pledge over what period of time.

The regional conference is intended for donors to pledge over an

envelope of 2 years, and we do anticipate that our EU colleagues,

as well as countries such as Japan, and countries such as Switzerland and Norway who are all members of the Stability Pact would

also make those pledges known at that time.

Chairman GILMAN. Thank you, Dr. Hamilton.

Let me remind our Members that, at the end of our hearing

today, we will have a markup on two items. We hope that our

Members will remain after our hearing, so that we can have a

quick markup on two very important measures, one concerning

Austria and the other one concerning Mozambique. So please bear

with us and stand by.

Mr. Lantos.

Mr. LANTOS. Thank you very much, Mr. Chairman.

For the sake of moving the process, I will not ask any questions.

I’d like to make just a very brief statement because my position

was clear from my opening remarks.

20

We are paying for past mistakes, and as is always the case when

we fail to deal with an issue at a point when it is in its embryonic

stage, we then pay for it heavily in blood and in treasure later on.

That’s what we are dealing with.

I think this is a well crafted, serious, responsible proposal and

I am in full support of it. I want to commend our witnesses and

I want to commend the Administration.

I do want to just make a very brief observation concerning your

questions on draw downs of American troops. I think there is a real

danger that we fall into the trap of considering draw downs as ipso

facto positive. There comes a point where draw downs add to the

danger that our troops face. I think it is very important to recognize that in dangerous situations, and certainly the Balkans qualifies, there is a great case to be made for overwhelming force being

on the ground——

Chairman GILMAN. Make a comment on procedure.

We’ll continue with our hearing. Mr. Bereuter is going down to

vote at this time and will come back. We will continue our hearing

without any break.

I am sorry for the interruption, Mr. Lantos.

Chairman GILMAN. The vote on the Floor relates to the Hansen

Amendment to the airport bill.

Mr. LANTOS. Right.

I think there is a very strong case to be made for having overwhelming force on the ground to deter the kind of violence which

we have seen lately from both the Serbian and the Albanian side.

I think this ritualistic incantation that draw downs are good contains very serious seeds of danger.

We have had plenty of examples since the end of World War II

where adequate U.S. presence, military presence on the ground—

both in Europe during the Cold War, in South Korea, continuing

as of today—have been successful in deterring violence and military activities. The Balkans are no different.

I am no more inclined to support a U.S. force of 3,000 than I am

a U.S. force of 4,600 or 5,900. These have to be military judgments

made by competent military commanders on the spot.

I believe strongly in the responsibility of Europeans to carry the

bulk of the load, and our role at this stage should be a minor participant role. However, I do not think it is in our national interest

to press for further reductions irrespective of the military judgments involved.

General Clark is a uniquely qualified American military commander to make the judgment on the level of our participation, and

I think it behooves Congress to support a proven and successful

military leader following the conclusion of an incredibly successful

military operation without a single American battle casualty, and

recognize that some of these troops may be there for a long, long

time to come. That is clearly preferable to a reemergence of hostilities in the Balkans, which is obviously the alternative we face.

I thank you, Mr. Chairman.

Chairman GILMAN. Thank you, Mr. Lantos.

Mr. Rohrabacher.

Mr. ROHRABACHER. I agree with Mr. Lantos in terms of making

sure that we have adequate forces. We do not want Americans to

21

die because we are being penny wise and pound foolish, but I also

agree, Mr. Lantos, that the Europeans certainly need to carry the

bulk of this weight.

As of this time, over the last 6 years, how much money have we

spent, and how much have our European allies spent? We are talking about military and all other spending.

Ambassador NAPPER. On the developmental assistance side, Mr.

Rohrabacher, the figures would be for the Europeans approximately $10 billion in developmental assistance over the period

1991 to 1999, and for the United States in a comparable period

something on the order of $2.1 billion.

Now, on the military side, I am not sure we have the comparable

figures.

Ambassador PARDEW. I have some figures here, Mr. Rohrabacher

which I will give to you, but I’d also like to take this for the record

because I think it is an important question. Let me give you the

information I have.

The total figure for military and nonmilitary expenditures for

Kosovo in Fiscal Years 1999 and 2000 is $6.3 billion.

Mr. ROHRABACHER. Excuse me. Could you repeat that again,

please?

Ambassador PARDEW. The total figure for military and nonmilitary expenditures in Kosovo in Fiscal Years 1999 and 2000 is

approximately $6.3 billion. Of that amount, approximately $1.2 billion comes from the Department of State accounts. This sum includes a supplemental appropriation. That’s what I have on

Kosovo.

Mr. ROHRABACHER. I have a figure in front of me that says the

U.S. has expended about $12.95 billion—so $13 billion on peace

keeping and military operations in former Yugoslavia since 1991.

Is that an incorrect figure?

Ambassador PARDEW. I cannot say if it is correct or incorrect, sir.

Mr. ROHRABACHER. OK.

Our European allies have spent $10 billion in assistance to that

area. Is that right? Is that what you testified?

Ambassador NAPPER. That would be our estimate on the developmental assistance side. Yes.

Mr. ROHRABACHER. It seems to me that we are spending more

than 50 percent, frankly, of what’s going on down there. My guesstimate, from what you’ve said and what I am reading here, I think

we are spending 50 percent. I think we are carrying the load at 50

percent. My guess is on the military side we are carrying. During

the actual fighting that took place, we carried maybe much more

than that.

Ambassador PARDEW. Let me give you a couple more numbers.

I want to give you a Bosnia number. I think you said Bosnia too,

right?

Mr. ROHRABACHER. OK.

Ambassador PARDEW. Let me just make a general comment and

then we will, I think, get some numbers for the record.

We are talking here largely about civil implementation programs,

and we are working very hard to stay within the guidance that the

Congress has sent to us.

22

I cannot speak to military spending. However, to me, military

spending is based on what it takes to prevail. If our military commanders believe that the forces are required—be they American or

European or whatever—we need to prevail there.

Mr. ROHRABACHER. That makes sense if you were doing it on

your own, what you just said makes all the sense in the world if

you’re doing it on your own. If you’re not doing it on your own, then

it could mean that we are being treated as a bunch of suckers by

Europeans who are letting us fly all the missions, take all the

risks, and then, of course, give us no gratitude in the end.

I sat next to some Europeans here for a NATO meeting just a

moment ago, and they were trying to tell me how the United States

was actually at fault for World War II because we had gone in and

helped in World War I, which prevented a compromise from happening, and of course because they didn’t have a compromise from

World War I, that led to World War II. That gave them a good reason not to be grateful for all the hundreds of thousands of Americans that gave their lives over there to save their hide. The Europeans are not going to be grateful to us.

We have to do what’s right, and we have to figure out what our

role is in the post-Cold War world. It is not to bear the burden for

people who are richer than us and have the capabilities of keeping

peace in their backyard. We’ll see. The Balkans is the first major

operation after the close of the Cold War, and we’ll see when all

the accounting is done whether the American people feel that that’s

the appropriate role and the appropriate level of investment for the

United States of America.

I’ve got some questions on that obviously myself, but that does

not reflect on you guys. You’re trying to do your job in the executive branch with the President. Over here in the Congress, we are

trying to make the right decision.

Ambassador PARDEW. My only point was that we cannot speak

for military spending. You make some excellent points here.

I would just say that within the civil side of this we are making

every effort to ensure that we pay our fair share, but nothing more

than that.

Ambassador NAPPER. If I could just make one further

comment——

Mr. ROHRABACHER. Could you hold on, I am worried I am going

to miss this vote.

Chairman GILMAN. We have about 4 minutes remaining on the

vote.

Mr. ROHRABACHER. I’ve got to run, I am sorry.

Chairman GILMAN. The Committee will stand in recess. Mr. Bereuter is on his way back and will reconvene our hearing as soon

as he returns.

Mr. BEREUTER. [Presiding] Ambassador Napper, I understand

you wanted to respond further to a point that was made or an issue

that was raised just before the temporary recess?

Ambassador NAPPER. Thank you, Mr. Bereuter, I appreciate that

opportunity.

Mr. Rohrabacher did refer to some figures, but I thought it might

be useful just to review a couple of figures that we put on the table

earlier and reflect the Administration’s commitment to burden

23

sharing and our success in achieving burden sharing, particularly

in Kosovo at this juncture.

What I would call the key benchmark, the yardsticks at this

point, are the contributions to the Kosovo consolidated budget,

which is the budget that runs the territory, contributions to police

deployments, and overall contributions to recovery and reconstruction in Kosovo. On each of those we have an excellent burden sharing story to tell.

With regard to the Kosovo budget, we have contributed approximately 13.4 percent of the total contributions made for 1999 and

2000. Of the number of police now deployed in the territory, a critical factor for maintenance of stability and the creation of order

there, we are at about 12.1 percent of total police deployed.

Mr. BEREUTER. Which country is that?

Ambassador NAPPER. The United States.

Mr. BEREUTER. In Bosnia or——

Ambassador NAPPER. Kosovo.

If we look at costs overall for reconstruction, economic revitalization, our percent is at 13.9 percent. Those are the best calculations

we have right now. We’ve worked very hard on these numbers, and

we feel that they are accurate.

With regard to Bosnia, over time, over the 4 or 5-year period of

the economic reconstruction and revitalization effort in Bosnia, our

percentage has been pretty consistently at 18 percent of the total

international community effort there.

So I do think we have good burden sharing. We work very hard

at it, we take it seriously. It is a matter of discussion at the highest

levels whenever Europeans and Americans meet on the Balkans.

Thank you.

Mr. BEREUTER. Thank you.

I’d like to proceed with some comments and questions. I thank

you gentlemen for your testimony and for what you’re doing to

oversee our resources and to bring coordination to the area.

I do have to tell you that I am very unsatisfied with what’s happening in Kosovo and Bosnia, and ask for redoubled efforts in certain areas.

One thing that is notable in your presentations is there is no

focus on Macedonia. Macedonia has borne a higher cost for what

has happened in the region, particularly in Kosovo, than any other

country. You should address that issue, and Congress should be responsive to those concerns. They have a government headed by a

prime minister who is a small ‘‘d’’ democrat, elected in 1998. They

deserve our assistance and we are not giving it to them in any substantial way.

Dr. Hamilton, I noticed your comments about that border crossing. I have seen it from the air. I understand we have, or will have,

examples of road rage there with people waiting in line for up to

2 days. Undoubtedly, there are examples of corruption there as

well. We have to solve that problem.

I’d like to know who is blocking the progress on East/West rail

service from Albania to Macedonia to Bulgaria. I’d like to know

why that’s not moving through the international financial institutions.

24

I notice that the SACEUR Wesley Clark has called for more

troops in Kosovo. I understand why he’s made that call but it is

the wrong call. It is international police that are not there, so military personnel are doing things that should be handled by the

international police force.

Having been in Kosovo 2 weeks ago, I am distressed to see the

slaughter of Serbs by the Albanian Kosovars in those communities,

despite the fact we are trying to give them 24-hour-a-day protection. Across the border in Presevo you have ethnic cleansing by the

Serbs of those Albanian ethnic communities.

I noticed the tanks of the 1st Infantry Division deploying on high

ground overlooking that border, and I hope they’ll be given the

order to fire if necessary to stop inappropriate conduct on the Serbian side of the border.

I am concerned that the Europeans and other countries committed to providing civilian resources in Bosnia and in Kosovo are

failing to deliver those resources, especially, of course, police.

I notice the calls for additional funds for peace keeping in the

Balkans and in East Timor. I hope you are living with what you

should understand by now is a limitation, and that we are providing no more than 25 percent of peace keeping forces’ cost to the

United Nations. We are not providing 31.7 percent. Previous democratically-controlled and Republican-controlled Congresses have

said we are providing no more than 25 percent. That’s part of the

reason we had the dispute regarding the size of our arrearages to

the U.N.

I know Ambassador Holbrooke is committed to trying to get

those changes, but I am hoping that these figures are not intentionally or inadvertently taking us over the 25 percent level. If necessary, I will add an amendment to legislation to ensure that no

more than 25 percent is provided.

I intend to vote against the supplemental. If I vote against it, not

that I am so powerful, you’re not going to get it passed because a

lot of people of the same view are not going to vote for that supplemental.

We need to re-orient; we need to get a lot tougher on corruption.

Somehow you’ve got to get a tough on corruption in Bosnia.

We are getting no direct foreign investment there. I’ve never

thought the Dayton plan was implementable, but it certainly is not

implementable as long as we have this level of corruption from all

parties in Bosnia.

So unless you can provide us some assurance that you are going

to provide some assistance, or be willing to take Congressional initiatives on Macedonia, and that we are going to get international

police comprised of people from the European Union countries and

other European nations, we are not going to pay more than 25 percent. I do not know why we should support the supplemental.

Other than that, I am happy with things.

Ambassador PARDEW. Mr. Bereuter, you covered a lot of territory

there. I cannot write fast enough to get all your points down.

Let me just hit some high points if I could.

First, on Macedonia, we agree that progress has been significant

there. I will let my colleagues speak to what is in the works for

them.

25

On the Blace border crossing point, we hope that construction

can begin on off site facilities which will allow these trucks to pool

before they travel to the site and we can clear that up.

Mr. BEREUTER. Do you think you can move them across the border more quickly?

Ambassador PARDEW. Yes. Part of this is processing. There needs

to be an offset place where they can go and be processed and then

they can move through the border crossing site. There’s just a limited road space to Blace, and to widen the roads and so forth is a

huge investment, so we are trying to do it other ways.

Mr. BEREUTER. You know this is a major lifeline to the rest of

the world. This is the Thesaloniki port connection.

Ambassador PARDEW. Yes, sir. Unfortunately the lifeline also

goes through Serbia. One of the real problems here is the main

four-lane highway through that region goes not through Kosovo,

but actually through Serbia. We cannot use that route, of course.

It is the lifeline to Kosovo.

Now, there are two things to help the transportation system.

Blace is one initiative we are working on, and we expect construction to start right away to fix it. The railroad connection there also

has to be improved. The Germans have provided additional locomotives, and we are doing some things there to help as well.

Mr. BEREUTER. What about the East/West corridor?

Ambassador PARDEW. I cannot answer that. I wrote that down.

Maybe Larry can speak to that.

Ambassador NAPPER. Mr. Bereuter, we agree with you entirely

about the importance of Macedonia. For that reason, in the Fiscal

Year 2000 assistance budget, we are doubling the base assistance

program for Macedonia.

We began in Fiscal Year 1999 with a base assistance program

there of $16 million. We are increasing that to $30 million in Fiscal

Year 2000. So it is roughly doubling it. We intend to try to maintain that level provided for Macedonia because we do believe it is

important and a vital country for the stability of the region.

We want to support the multiethnic government that’s been

formed there. I was just in Macedonia, had good talks with the government about how we would use this assistance. I think we are

trying to move vigorously to support them.

Mr. BEREUTER. I was there about 12 days ago with 12 Members

of Congress. I do not know if that was before or after your visit.

Ambassador NAPPER. It was just about the same time, as a matter of fact, because you had just been in there, I think, the day before.

Mr. BEREUTER. I noticed the French would not let us keep our

airplane on the apron while we were there for 1 day, but that’s a

side issue with the French. We had to fly it all the way back to

Italy, and then it came back to pick us up 6 hours later.

Ambassador NAPPER. With regard to the East/West transport

corridor which you mentioned, under our South Balkan Development Initiative, the United States has provided $30 million over

the last 4 years for the development of that East/West corridor that

links Albania, Macedonia and Bulgaria. We have been providing

considerable assistance there.

26

What we want to do now is to move that assistance into a multilateral framework under the Stability Pact. Dr. Hamilton can address that in a moment.

Mr. BEREUTER. Ambassador Napper, I thought there was a request pending before the World Bank, and it’s been blocked in the

World Bank. It seems to me the World Bank has a role in this and

this would be a multilateralization of that assistance.

Ambassador NAPPER. That’s exactly what we are trying to do. We

are trying to take a bilateral program, which we have been funding

for the past 4 years, in advance of the international community,

rally support for Macedonia and the other two countries, and trying

to put it in and develop greater international assistance for it. I

agree with that, and that’s the clear direction that we are headed.

Mr. BEREUTER. International police?

Ambassador NAPPER. On international police, yes. We agree with

you that international police are, in fact, in many ways the key to

the problem of maintaining public order. Here the story frankly is

not—I agree with you, it is not as good as we would have perhaps

hoped by this juncture.

The total number of the police authorized for the Kosovo mission

at this point is 4,718.

Mr. BEREUTER. The original request was 6,000 and cut back to

that, I believe.

Ambassador NAPPER. Actually——

Ambassador PARDEW. The new requirement now is about 4,800.

Ambassador NAPPER. Right.

Mr. BEREUTER. The original request, a suggestion from the international people, was 6,000 and we are at, about 2,000?

Ambassador NAPPER. The Security Council of the United Nations

is the body that makes the decision as to how many police are authorized for the mission. They started out with an authorization of

just over 3,000 police. That authorization was then increased at the

suggestion of the people on the ground to this 4,718 figure.

Mr. BEREUTER. Is it true that we actually have a reduction in

people there now? Are forces leaving and not being replaced?

Ambassador NAPPER. No, I think the reverse is true. There is an

increase in the number of police deployed. There are 2,375 police

deployed, that’s the figures we have today, which leaves you with

52.3 percent of those authorized deployed.

Now that is not adequate, and we are trying to get that figure

up. That’s one of the things we have in the request for the supplemental, which I hope you will reconsider your views of that and

help us.

Mr. BEREUTER. It depends on how good you can make the Southeast Balkan ones, because my problem is throwing the money away

in Colombia.

Ambassador NAPPER. I would not be able to address that, Mr.

Bereuter.

But I do hope that at least the Southeast Europe part of it could

earn your support. Part of that is to provide some additional U.S.

police, and we are pressing very hard with our European allies to

get their police number up.

It has improved somewhat. They’re now at 64 percent of their

pledges for police and moving up in the right direction. So the poVerDate 11-MAY-2000 14:31 Nov 09, 2000 Jkt 000000 PO 00000 Frm 00030 Fmt 6633 Sfmt 6633 65354.TXT HINTREL1 PsN: HINTREL1
27

lice situation is not adequate there, we agree with that, but we are

increasing our own commitments and we are urging others and

having some success in getting them to increase.

Ambassador PARDEW. Let me just add a point, please. There are

really three elements on police. First there’s the international police, and those numbers are not adequate—2,300 of 3,700 required.

Then there’s the Multinational Support Unit (MSU). These are

units in Kosovo for riot control and so forth. We have three units

that have volunteered so far, three countries that have volunteered.

They have not yet arrived. It is an issue of facilities, but we are

hopeful that facilities will be available, soon.

The third element is the local police. We had to start from

scratch creating local Kosovo police, creating from scratch a police

training academy, recruiting people, and so forth.

Mr. BEREUTER. It is very difficult, I know.

Ambassador PARDEW. We’ve had two classes graduate. We are

trying to increase the output to 500 every 8 weeks, and to find an

additional facility outside of Kosovo, in Europe, where we could

double the number of local police this coming year.

Mr. BEREUTER. Can they be trained in Budapest at the center

there?

Ambassador PARDEW. The Hungarians have made an offer. The

Swiss have made an offer, and other countries are looking at possibilities of using their facilities for off site training.

Mr. BEREUTER. I was told there are 173 graduates out there

today, 8 of whom are Serbs.

Ambassador PARDEW. There are two classes of about 175 each.

One just graduated before you got your number. A very, very small

number of Serbs participate in this program and there are many

reasons for that. The Serbs in the north are simply not promoting

participation. Second, some Serbs are fearful of working with the

Kosovars. We are encouraging Serbs to participate——

Mr. BEREUTER. We are trying to employ them at Bondsteel. A

very small number said they are willing, as Kosovar Serbs, to be

employed, but that Kosovar Serbs have been killed in a couple of

instances or intimidated in others so they do not show up anymore.

Ambassador PARDEW. Intimidation is a major problem throughout Kosovo. That’s true. We are doing everything we can to prevent

that, and to work with the moderates, but the influence of extremists is still significant and it is a problem.

Ambassador NAPPER. Just one other question that you had, Mr.

Bereuter, was about the assessed U.N. peace keeping costs. I wanted to assure you that the level of peace keeping funding that we’ve

requested in the President’s supplemental would not exceed 25 percent of the U.N. assessment, so if we got supplemental, we would

not exceed 25 percent.

Mr. BEREUTER. I am glad to hear it.

Ambassador NAPPER. A couple of points briefly on the question

of the Europeans.

As I said, every time Americans and Europeans meet to discuss

this issue—the Secretary will do so again tomorrow when she

meets Patten and others in Brussels—we’ve had discussions continually on the question of European commitments and fulfilling

those. We’ve seen some success on this.

28

The budget cycles are different. They only begin their budget

cycle at the beginning of January, and so disbursements come later

than ours because we have a budget cycle that begins a bit earlier.

But we have, for instance, seen considerable European commitments fulfilled on the Kosovo consolidated budget. They’ve just deposited $10 million in that and another $20 million is due at the

middle of March. So these commitments are beginning to be fulfilled.

Mr. BEREUTER. What do you feel about their response to the need

to keep their commitments on police?

Ambassador NAPPER. I think they——

Mr. BEREUTER. I know the Danes are, but who else is?

Ambassador NAPPER. I think there are a number of European

governments that have begun to increase their commitments on police. For instance, the Austrians have deployed 49 out of 50 of the

ones that they had promised. Denmark is 26 out of 26. Finland is

20 out of 20. France is current with their deployment. Others are

lagging. In fact, there are other—because this is a worldwide police

effort, there are other countries that are not European countries

that, in fact, are the ones that are, if you will, lagging a bit behind.

Mr. BEREUTER. The Europeans provide about 40 percent? Is that

correct—only 40 percent of the total police force?

Ambassador NAPPER. They have provided——

Mr. BEREUTER. Pledged, I mean.

Ambassador NAPPER. They have provided 64 percent of their

total pledge.

Mr. BEREUTER. Overall, of the total police force, their commitment is only about 40 percent? Is that roughly correct?

Ambassador NAPPER. If you take the European Union countries

and the other OSCE countries, it is about 40.8 percent, yes.

Mr. BEREUTER. The OSCE countries enlarge dramatically beyond

the EU countries.

Ambassador NAPPER. Yes.

Mr. BEREUTER. It seems to me that the Europeans are playing

a pretty small role if their overall commitment, even though they

haven’t met it, is only 40 percent.

Ambassador NAPPER. They could be doing more, we are urging

that they do so, and it is improving. The numbers are improving

on the European commitment.

Mr. BEREUTER. The problem with having peace keeping forces

from the rest of the world, in many cases, is that outside people

are not culturally attuned at all to that environment. It is bad

enough for a European or an American to go into that area, but

forces from Southeast Asia or from Africa have problems from the

beginning. They, in fact, create problems at times, unfortunately.

If the Europeans cannot pick up a much larger role of the international police keeping force, I do not think you’re ever going to get

an effective police force there that meets the 4,000-plus requirement.

Ambassador NAPPER. We are certainly trying to. The police effort

there certainly involves an effort to keep a certain standard, to

have a certain standard in terms of the capabilities of the individual policeman to do his job. That applies across the board.

29

It is not an ideal situation. We are relying on a multilateral force

to be organized, and in part, as we do want to keep our commitment to a relatively small part, we have to encourage others to deploy. It is not to our satisfaction at this juncture, but there has

been improvement.

Mr. BEREUTER. I will just look for what you can do through the

Administration to increase the European commitment. You’re stuck

with me because I have no colleagues here, so you’re suffering

through my questions, but I haven’t heard yet anyone address, and

maybe I haven’t given you a chance, the problems of corruption,

particularly in Bosnia.

Ambassador PARDEW. Let me address what we are doing to solve

the international police problem.

The President is personally involved in this, making phone calls,

discussing the issue with his counterparts. He’s directly engaged

and encouraging our European colleagues to contribute more police.

Secretary Albright is meeting tonight with her colleague. This

will be a major topic of discussion in that meeting.

We are working this at every level because we recognize this is

a critical issue holding us back.

Mr. BEREUTER. I would like to strengthen your hand, so I hope

you will recognize that when you see my handiwork.

Ambassador PARDEW. On the issue of corruption in Bosnia, we

are working this at two levels. First, there’s the criminal element

of this. In that regard we are improving the quality of our assistance there by providing FBI and other expertise. We are working,

again, with our European allies, to create an armed international

police element to participate in the investigative process of corruption at a high level.

The second element of the anti-corruption program is economic

reform. We have to break the link of the nationalist parties controlling economic enterprises. We are working with the World Bank,

the IMF, and others to take a tough position on conditionality to

force privatization and reform. We are not happy with the level of

privatization in Bosnia at this point to get these companies out of

the hands of these parties and——

Mr. BEREUTER. I think you understand the problem, and I just

think you’re going to have to do something really dramatic to break

through here. Otherwise we are just not going to get direct foreign

investment in there. You’re not going to see a willingness for countries to put resources into Bosnia.

Ambassador PARDEW. We have passed that message to the leadership there as late as yesterday when Secretary Albright met with

the presidents. We have told them there’s no international commercial bank in Bosnia. We are hopeful that one will be there in the

next couple of months.

Our Ambassador to Bosnia, Tom Miller, has withdrawn assistance on privatization, specifically to make the point. I have worked

through Treasury with the IMF and the World Bank to toughen

the conditionality to force the issue on privatization.

Congressman, this is one we are taking extremely seriously, and

we are building in some very tough conditions to make it happen.

We want the payment bureau taken down and we’ve got a schedule to do so. The payments bureau is a holdover from the old comVerDate 11-MAY-2000 14:31 Nov 09, 2000 Jkt 000000 PO 00000 Frm 00033 Fmt 6633 Sfmt 6633 65354.TXT HINTREL1 PsN: HINTREL1
30

munist system, the system they used to move money through a

government. We plan to have it dismantled by the end of the year,

and we are going to take a very hard line with it.

Mr. BEREUTER. It may be helpful to you to provide some detail

on that before we go to debate on these issues, and I’d be interested

in seeing it.

Ambassador PARDEW. I’d be happy to.

Mr. BEREUTER. I need to go vote but I want to give Dr. Hamilton

a chance.

Dr. HAMILTON. Just briefly, on Macedonia in particular. On

Blace, part of the arrangement, the deal that’s coming together, is

a one-stop process, so that instead of stopping along the border

they just go right through it one time.

The construction would facilitate the off-road, and then when

they’re ready to go they’d just go across. As Ambassador Pardew

said, the construction of that should start right away.

On your issue on the rail, the Committee has made clear our effort here is to leverage European and IFI funding. Through the

Stability Pact, what we have done is provide a package on energy,

on transportation, and on environment and water. At this regional

conference we expect that the Europeans and the international financial institutions will approve a solid package for Macedonia in

these three areas which connects the Macedonians to their neighbors in energy, transportation and water, and that these projects

would be able to start.

The project you mentioned has been part of the vetting process

by the international financial institutions so that they would hopefully be able to fund that. That is what is underway.

The other part we have made clear to our European counterparts

is the need for the European Union to open its market further to

access for not only Macedonia, but the other countries in the region. As Secretary Albright made that point as recently as yesterday, she will be seeing President Prodi tomorrow and making the

same point.

We are working very carefully with the Macedonians right now

because they are the Co-chair of the economic table for the Stability Pact. The international community met in Skopje about a

month ago, and the government pledged good things in that area.

But they have signed this investment compact which pledges them

to work on specific reforms in the economic area.

We have created a country team mechanism by which the donor

community works with key decisionmakers in each country government, including Macedonia. The team just met on Tuesday with

the senior levels of the Macedonian government on their next steps

on economic reform. It is a supportive group. It includes all the donors, and it is proceeding.

So there are a number of things that are focused on Macedonia.

We hope to have more.

Mr. BEREUTER. Thank you. I have an educational initiative that

I will offer. I hope you will look kindly on if you can.

Does the gentleman from California have questions? Otherwise I

am going to dismiss the witnesses.

Mr. SHERMAN. Yes, I do.

Mr. BEREUTER. Just let me say a couple of things here first.

31

The Committee will submit questions for answers in writing to

our witnesses, and I want to say before I leave that I appreciate

your testimony and your responses.

I am going to turn the chair over to Mr. Lantos and hope for the

best here. The other gentleman from California, Mr. Sherman, can

ask his questions after which time, if Chairman Gilman is not

back, Mr. Lantos is free to dismiss the witnesses. Then we’ll have

a short break, pending Mr. Gilman’s return, at which time the

Committee will markup the two bills.

Thank you very much.

Mr. Lantos.

Mr. LANTOS. Mr. Sherman.

Mr. SHERMAN. Japan is physically closer to Bosnia and Kosovo

than my district in California. How much money, how many troops,

how many lives have been put on the line by the Japanese to defend peace and security in Southeast Europe?

Ambassador PARDEW. First of all, as you know, Congressman,

Japan, I think, has some restrictions on that. Their military——

Mr. SHERMAN. So they benefit economically by having restrictions—Is there any restriction in the Japanese constitution that

would prevent them from sending money to pay for the American

troops?

Ambassador PARDEW. The Japanese are contributors to the

Kosovo——

Mr. SHERMAN. How much money have they sent?

Dr. HAMILTON. Japanese contributions and disbursements to UNMIK, the total pledged is $7.3 million, which is 4.1 percent of

the total pledged.

Mr. SHERMAN. That’s of that particular agency. But when you

look at the cost of establishing peace, first in Bosnia then in

Kosovo, when you look at putting American lives on the line, you

would not say that the Japanese effort is 4 percent of the American

effort in terms of the total cost, including the cost of maintaining

military presence there.

I realize that’s comparing apples and oranges. I am just bringing

this question up to illustrate the fact that other rich countries are

shirking their responsibilities. It is absolutely absurd that we still

have peace keeping troops doing the job that Europeans should be

doing, and that we are still incurring a cost to do that. I think historians are going to have to compare this to our reaction in southern Sudan where neither Europe nor the United States is doing

anything. A Europe that cannot keep peace in Europe obviously

makes it more difficult for us to do anything in southern Sudan.

Ambassador, I can see that you wish to respond.

Ambassador NAPPER. I just wanted to add one other fact for the

record, Mr. Sherman. For our calculations with regard to the overall burden sharing effort in Kosovo, Dr. Hamilton has mentioned

the contributions to the consolidated Kosovo budget, but taken as

a whole, the Japanese contribution thus far is $88.7 million out of

a total of $1,210,000,000. So it is a little over 7 percent.

Mr. SHERMAN. It is tough enough that the foreign services of Europe and Japan do everything possible to overstate their effort and

to understate ours. My fear is that our own foreign policy establishment does likewise. If anyone thinks that the total effort in Kosovo

32

was a $1.5 billion effort, that the total effort in Kosovo of all countries was less than it costs to build a freeway interchange, then

they must have been sleeping through the entire war.

I do not know what figure you used, but to look at what was the

primary focus of American military power for many months and to

attribute less than one-half of 1 percent of our military budget during the period of hostilities toward what was the focus of our entire

military establishment illustrates the fact that our own foreign policy establishment is working hard to explain, to understate the fact

that American taxpayers, American men and women in the military are bearing a very disproportionate share of the load. Even

today, George Bush, Governor of Texas, is able to say quite poignantly that even if we are forced by circumstances to be the peacemakers, why are we stuck being the peace keepers?

What especially concerns me is we were told to get involved in

Kosovo because Europe was so much more important to us than Africa, because Europe was so economically powerful and significant,

yet this powerful European continent cannot patrol a tiny area, an

area where less than two million people live.

It strikes me as odd that we are told that Europe is so important

that we must go and defend them, that they are so powerful that

they deserve our help, and yet so powerless that they need it. It

is disappointing, to say the least, that we are still carrying European responsibilities at the cost of the American taxpayer. To try

to claim that Japan is doing 5 or 10 percent of the load-carrying

in Kosovo and Bosnia, I think strains all of our understanding of

the situation.

I will yield back the balance of my time.

Ambassador PARDEW. I just wanted to say, Congressman, that of

course our engagement in this region—as I said in my opening

statement—is based on our interests there. We do think the European interest is greater than ours. It is their continent. But we are

a partner with Europe. We are partner in NATO. This is a NATOled operation, and we should participate in that partnership.

Mr. SHERMAN. We have deliberately structured this situation. We

could have formed a new organization, including Japan, and invited Japan to contribute more money. We could have invited the

European exclusive organizations to participate. We are a partner

of every nation in the world, virtually. We’ve even told we have a

strategic partnership with China. Certainly we are members of the

United Nations. So simply by picking which organization will intervene here or there, we can declare that any corner of the world is

a place where America must bear a disproportionate share of the

burden.

The fact remains that 5 and 10 years from now the Japanese will

be selling more manufactured product in Kosovo than we are. That

10 and 20 years from now Europe will continue to engage in trade

practices that show that they are indeed powerful diplomatically

when they want to be—powerful in fighting for their own economic

interests and powerful in twisting American policy to meet their

economic objectives.

You have a variety of different hats and flags that can be flown

over different trouble spots, and we’ve chosen the words NATO to

try to imply that the people of Los Angeles have a greater responsiVerDate 11-MAY-2000 14:31 Nov 09, 2000 Jkt 000000 PO 00000 Frm 00036 Fmt 6633 Sfmt 6633 65354.TXT HINTREL1 PsN: HINTREL1
33

bility for assuring peace in Pristina than the people of Tokyo.

That’s a conclusion that we reached only because we wanted to.

Geographically, that is not the way God designed the planet.

Ambassador PARDEW. I would only like to assure you that the

foreign policy establishment is making every effort to ensure that

others pay their share. As Ambassador Napper and others have

mentioned this morning——

Mr. SHERMAN. I believe I still have time, and I will say that

every effort possible means every effort that doesn’t unduly trouble,

inconvenience or anger those who are foisting their responsibilities

on us. Every effort possible would be announcing that it is up to

Europe to carry this and that we are leaving except for perhaps

some technical assistance that they’re unable to do.

We were told during the war that we had to do all the bombing

because their planes didn’t work. Of course they were unwilling to

buy any of ours before then or in the future. Now we are told we

have to patrol because every effort possible means everything that

doesn’t make them too angry.

I believe my time is expired.

Mr. ROHRABACHER. As much as the Chairman appreciates the

comments of my friend, we have to move on.

Does any other Member have——

Ms. LEE. Yes, Mr. Chairman. I will be very quick.

As to what our policy is now this year with regard to the reconstruction efforts, the infrastructure-building—I know last year the

President made statements that we were reluctant to do that because of the fact that Milosevic was still there. But given that the

bombing, of course the bridge and all of the other buildings that

were damaged, what are we doing, if anything? Does any of this

money go toward that? Or do we still have a kind of hands-off approach on actual reconstruction efforts?

Dr. HAMILTON. Do you mean for Serbia particularly or for the region?

Ms. LEE. In Kosovo specifically.

Ambassador NAPPER. With regard to Kosovo, the appropriations

bill that was passed last fall precludes an American involvement

in large-scale physical reconstruction in Kosovo. That was a prescription in the law, so we are not doing that. We are undertaking

a number of programs to promote the economic revitalization of

Kosovo, and this goes across a whole gamut of activities, from encouraging the growth of small and medium enterprises, to a revival

of agriculture in Kosovo, to providing assistance to the authorities

there and those authorities that will be elected later in the year,

local municipal governments, in structuring their finances and

taxes, technical assistance in that regard. So across a whole gamut

of activities we are trying to promote the economic revitalization of

Kosovo, but we are precluded by law from engaging in large-scale

reconstruction of, for instance, rebuilding power plants or the airport or roads or things of that nature.

With regard to Serbia, fundamentally the guidelines are still as

we discussed them with you the last time we were here. That is,

as long as Milosevic is in power, we will not be doing any reconstruction assistance in Serbia.

Ms. LEE. Thank you.

34

Mr. ROHRABACHER. Any other Member have questions?

Seeing none, the Chair will indulge in one question.

I understand there are reports that the communist Chinese government has invested big sums of money in Serbia. Do you have

any indication of that?

Ambassador PARDEW. There were reports some months ago that

there was some investment, some financial dealings between the

Chinese and Milosevic. We have discussed this with the Chinese

and have been assured that it had stopped, but let me get you an

answer for the record on that.

Mr. ROHRABACHER. As far as all the witnesses, do you know of

any communist Chinese investment in Serbia?

Ambassador NAPPER. I know of nothing more than what Ambassador Pardew has just stated, Mr. Rohrabacher.

Mr. ROHRABACHER. All right. That would be a matter of concern,

obviously.

I would ask any Members of the Committee who would like to

ask further questions to submit them in writing for our witnesses.

We do appreciate our witnesses and thank you very much for

spending this time. We’ve had to run in and out here.

We will now excuse you, and the Committee stands adjourned

pending the Chairman’s return.

Without objection, written questions for witnesses will be submitted within 1 week.

[Whereupon, at 12:14 p.m. the Committee was adjourned.

(35)

A P P E N D I X

MARCH 9, 2000

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