United States General Accounting Office

GAO Report to the Chairman, Committee on

International Relations, House of

Representatives

May 1996 NATO

ENLARGEMENT

NATO and U.S. Actions

Taken to Facilitate

Enlargement

G O A

years

1921 - 1996

GAO/NSIAD-96-92

GAO United States

General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-270972 

May 6, 1996

The Honorable Benjamin Gilman

Chairman, Committee on International Relations

House of Representatives

Dear Mr. Chairman:

In January 1994, the North Atlantic Treaty Organization (NATO) committed

itself to enlarging its membership to include newly democratic states of

the former Communist bloc. According to the Department of State, the

U.S. government has been the driving force behind NATO’s enlargement

process. In response to your request, we examined issues involving this

future enlargement. Specifically, our objectives were to identify (1) the

nature of actions taken or planned to facilitate the future enlargement of

NATO, (2) the extent of current and planned U.S. bilateral assistance

programs to enhance the military operations and capabilities of NATO’s

aspiring members, and (3) the potential costs of enlargement to NATO and

the new members.

As you requested, we will continue our evaluation of NATO’s Partnership

for Peace (PFP) program and bilateral programs that complement and

support it.

Background NATO was formed in 1949 to promote stability in the North Atlantic area

(see app. I for NATO’s North Atlantic Treaty) by uniting member nations’

efforts for collective defense and the preservation of peace and security.

After expanding three times over the years, NATO currently has 16

members.1

 With the collapse of the Soviet Union, the dissolution of the

Warsaw Pact, and German reunification, NATO redefined its strategic

concept at its Rome summit in 1991 to reflect the post-Cold War

geopolitical landscape. The new strategic concept articulated a new

conventional military force structure for NATO, greater emphasis on crisis

management and conflict prevention, less reliance on nuclear forces, and

committed the Alliance to pursuing greater cooperation with its former

adversaries to the east.

1

Belgium, Canada, Denmark, France, Germany (1955), Greece (1952), Iceland, Italy, Luxembourg, the

Netherlands, Norway, Portugal, Spain (1982), Turkey (1952), the United Kingdom, and the United

States.

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Results in Brief Since the 1991 Rome summit, in accordance with the new strategic

concept, NATO has initiated two programs designed to reach out to its

former adversaries to the east— the North Atlantic Cooperation Council

(NACC) and the PFP program. NACC, established in 1991, provides a forum for

dialogue between NATO and countries of the former Communist bloc on

such matters as defense planning; aspects of strategy, force and command

structures; democratic concepts of civilian-military relations; nuclear

disarmament; crisis management; and peacekeeping. PFP, established in

1994, is intended to promote greater cooperation between NATO and PFP

members in the areas of defense budgeting, joint planning, joint military

exercises, and enabling PFP nations to operate with NATO forces in such

areas as peacekeeping, search and rescue, and humanitarian missions. In

September 1995, NATO released an internal study examining the rationale

for enlarging NATO and how it might occur. However, NATO members have

not yet established a timetable for enlargement or decided who will be

invited to join.

The United States has five bilateral assistance programs that help to

improve the operational capabilities of potential NATO members and other

countries of Central and Eastern Europe and the Newly Independent

States. These programs are bilateral PFP assistance (the Warsaw Initiative),

Foreign Military Financing,2

 the International Military Education and

Training program, the Joint Contact Team Program,3

 and Excess Defense

Articles transfers. All but the bilateral PFP assistance predate discussion of

NATO’s future enlargement.

In fiscal year 1995, the United States provided about $54 million in

bilateral assistance to PFP member states through the five bilateral

assistance programs; in fiscal year 1996, the United States will provide

about $125 million. This increase largely supports PFP bilateral assistance

for cooperative activities with these nations. Of the total $179 million,

about $130 million (or 73 percent) represents support for the PFP program.

Neither NATO nor the United States knows what the total costs of

enlargement will be to NATO or individual members, both current and new.

Increased membership will place new financial burdens on NATO’s

commonly funded infrastructure programs and on the new members

themselves. Many of the costs of enlargement would be expected to be

2

In fiscal year 1996, $60 million of Foreign Military Financing funding is to be in support of the Warsaw

Initiative. This represents the first time Foreign Military Financing funding has been used in support of

the Warsaw Initiative.

3

Formerly called the Military-to-Military Contacts program.

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borne by the new members, some of whom may lack the ability to fund the

changes necessary for their militaries to become interoperable with NATO

forces. The cost that each new member may incur cannot now be fully

determined because NATO has not yet defined country-specific military

requirements. Nevertheless, U.S. officials anticipate that these nations may

require bilateral or multilateral financial assistance from the United States

and other NATO members.

NATO Actions to

Facilitate Future

Enlargement

North Atlantic Cooperation

Council

NACC, which includes all 16 NATO nations, all former members of the

Warsaw Pact,4

 Albania, and four observer states,5 held its first formal

meeting in December 1991, the same month that the Soviet Union

dissolved. NACC holds at least one regular meeting per year with

consultations on such matters as political and security-related issues,

defense planning questions, key aspects of strategy, force and command

structures, democratic concepts of civilian-military relations. NACC work

plans and discussions have broadened to include such topics as nuclear

disarmament, crisis management, cooperation in peacekeeping, and

progress on the PFP program.

Partnership for Peace

Program

NATO initiated PFP in January 1994 to (1) expand and intensify political and

military cooperation in Europe, (2) extend European stability eastward,

(3) diminish threats to peace, and (4) build better relationships with

former Communist countries through practical cooperation and

commitment to democratic principles. Participation in the program does

not require an intention to become a NATO member nor does it guarantee

future membership in the Alliance, although, according to the Secretary of

4

Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia, and all

states of the Former Soviet Union (Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan,

Moldova, Russia, Tajikistan, Turkmenistan, Ukraine, and Uzbekistan). East Germany was united with

the Federal Republic of Germany in 1990.

5

Austria, Finland, Slovenia, and Sweden.

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Defense, PFP is “the pathway to NATO membership for those partners that

wish to join the Alliance.”6

Currently, 27 countries have joined PFP,

7

 and many have already agreed to

Individual Partnership Programs, which spell out specific cooperative

activity programs to take place between NATO and the partner. As of

August 1995, NATO members and PFP partners had held 24 joint exercises

providing practical military cooperation.

NATO civil budget8 funding pays for NATO’s own administrative, security,

and communications costs related to NACC and PFP, and for the

construction of new facilities for partner countries at NATO civilian and

military headquarters. Table 1 shows NATO civil budget funding9

 for

outreach activities from 1991 through 1996.

Table 1: NATO Civil Budget NACC and

PFP Funding, Calendar Years 1991-96 Dollars in millions

Calendar year Amount

1991 $1.6

1992 5.4

1993 10.7

1994a 13.5

1995 17.1

1996 (estimated) 18.5

Total $66.8

aPFP began in January 1994. NATO does not separate NACC and PFP funding.

Source: U.S. Mission to NATO.

6

Testimony of the Secretary of Defense, before the Senate Committee on Armed Services, March 5,

1996.

7

Albania, Armenia, Austria, Azerbaijan, Belarus, Bulgaria, Czech Republic, Estonia, Finland, Former

Yugoslav Republic of Macedonia, Georgia, Hungary, Kazakhstan, Kyrgyzstan, Latvia, Lithuania, Malta,

Moldova, Poland, Romania, Russia, Slovakia, Slovenia, Sweden, Turkmenistan, Ukraine, and

Uzbekistan.

8

Most PFP and NACC program costs are paid from NATO’s civil budget. Other costs, like exercises and

infrastructure, are paid from the NATO Military Budget and from NATO Security Investment Program

funds. The U.S. contribution to the NATO Civil Budget is funded through State Department

appropriations.

9

U.S. portion is 23.35 percent.

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NATO’s Enlargement Study In September 1995, NATO released an internal study of the rationale behind

the enlargement and the way it should occur. In this study, NATO identified

the following goals: (1) enhancing stability and security in the

Euro-Atlantic area, (2) eliminating the old Cold War barriers without

creating new ones between the East and West, (3) encouraging democratic

and economic reforms in aspiring NATO members, (4) emphasizing

common defense and extending its benefits and increasing transparency in

defense planning and military budgets, (5) reinforcing the tendency

towards integration and cooperation in Europe, (6) strengthening the

Alliance’s ability to contribute to international security through

peacekeeping activities, and (7) strengthening the trans-Atlantic

partnership.

The study defined the standards that aspiring members must be committed

to meet before membership is offered. Militarily, these nations must

commit to meeting minimum NATO standards of interoperability.

Politically, aspiring NATO members are expected to establish civilian

control over their militaries, a new concept for most of the former Warsaw

Pact states. More subjectively, applicant nations must demonstrate a

commitment to democratic values, as embodied in the NATO treaty.

Aspiring members must also strive to peacefully eliminate internal ethnic

disputes or territorial disputes with neighbors. Finally, new members must

agree not to prevent other aspiring nations from joining NATO.

Although the study articulated enlargement goals and new member

entrance requirements, it did not assess any individual nation’s progress

toward NATO membership. In fact, NATO members have not yet established

a timetable for enlargement or who will be invited to join.

The enlargement study also discussed how an aspiring member will join

NATO. According to the study and NATO and U.S. Mission to NATO officials,

the steps to be taken will be as follows.

• The process would begin with an informal invitation from NATO’s North

Atlantic Council to the prospective member to enter into accession

negotiations with NATO. Before this invitation is given, there must be

unanimous consent among all of the current NATO members. If even one

disagrees, the invitation cannot be offered.

• Once an invitation is made, the prospective member must make a formal

commitment to join. NATO and the prospective member would negotiate a

protocol of accession that sets forth in detail what each party expects of

the other and any special or unique circumstances pertaining to the

Page 5 GAO/NSIAD-96-92 NATO Enlargement
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prospective member’s future membership. An example of special

circumstances could include the provision that no NATO nuclear weapons

could be deployed on the country’s territory during peacetime.

• The North Atlantic Council must approve the accession protocol and if it

does not, the protocol must be amended until it meets Council approval. If

it fails to do so, the process can be stopped and the prospective member’s

bid to join NATO is effectively ended.

• Once the protocol is approved, it is signed by the North Atlantic Council

and the prospective member. The accession protocol must then by ratified

by the governments of all the current members and the prospective

member and then enters into force. For example, in the United States, this

will require a two-thirds majority in the Senate to amend and ratify the

treaty. If the protocol is ratified by all members and the aspiring member,

a formal invitation is made to the prospective member to accede to the

North Atlantic (or Washington) Treaty. Once the aspiring member signs

and gives the treaty to the U.S. government, it is considered a full member

of NATO. If the accession protocol is not ratified by all 16 current members,

the prospective member may not sign the Washington Treaty. At this point,

the accession protocol could be amended again and resubmitted or the

process can be terminated.

U.S. Bilateral

Assistance to PFP

Member States

In addition to its contribution through NATO common budgets, the United

States provided about $53 million in fiscal year 1995 to PFP member

countries through five bilateral programs that help to enhance their

military equipment and operations. As table 2 shows, the fiscal year 1996

amount for these programs increased to about $125 million. This increase

will largely support cooperative activities with PFP member countries.

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Table 2: U.S. Bilateral Assistance to

PFP Member States, Fiscal Years 1995

and 1996

Dollars in millions

Program Fiscal year 1995 Fiscal year 1996

PFP (Warsaw Initiative) $30.00 $100.00

Joint Contact Team Program 10.00 15.00

International Military Education and Training 5.97 10.22

Foreign Military Financing 1.00 a

Excess Defense Articles transfer 6.63b c

Total $53.60 $125.22

aIn fiscal year 1996, $60 million of Foreign Military Financing funding is in support of the Warsaw

Initiative and has, therefore, been included above in the PFP line.

bThis represents the Department of Defense’s (DOD) estimate of the current value of the

transferred articles.

cNot available.

All of these programs, except PFP assistance, predate discussion of NATO

enlargement. None were specifically designed to enhance the prospects of

NATO membership. However, DOD believes it plays an important role in

enhancing prospective new members’ capabilities, and as indicated, the

Secretary of Defense has described PFP as the pathway to NATO

membership.

Partnership for Peace

Program

The United States has provided $130 million in bilateral support to the PFP

program over 2 years. This funding assists PFP member countries to

participate in NATO’s PFP exercises and helps them to obtain equipment

through the Foreign Military Financing program. In addition, it is hoped

that the program will foster stability in Eastern Europe through the

development of civilian-controlled militaries and exposure to U.S. and

other NATO members’ military policies and procedures. Further, DOD

believes that U.S. bilateral funding of PFP lends credibility to the program

and will encourage other countries to put forth a portion of their small

budgets for PFP.

Fiscal year 1995 bilateral funding for PFP assistance included $19.25 million

for exercises and $10.75 million for interoperability programs. The

$100 million of PFP assistance (under the Warsaw Initiative) provided to

member countries in fiscal year 1996 allocates $60 million to the State

Department to fund Foreign Military Financing in support of the Warsaw

Page 7 GAO/NSIAD-96-92 NATO Enlargement
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Initiative and $40 million to DOD to support individual partner participation

in joint exercises and programs to enhance NATO-PFP interoperability.

Poland is expected to be the recipient of the largest amount of aid in fiscal

year 1996, $25 million. The Czech Republic, Hungary, Romania, and

Ukraine are each expected to receive $10 million in U.S. bilateral PFP

assistance, while Russia is expected to be offered $7 million in PFP

assistance, including $5 million to help Russian troops participate in PFP

exercises. Seventeen other nations may also receive some U.S. bilateral

PFP assistance. Table 3 shows fiscal year 1996 bilateral PFP funding by

country.

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Table 3: PFP Support Programs and

Bilateral Assistance, Fiscal Year 1996 Dollars in thousands

DOD Support

Programs

State Department

Bilateral

Assistancea Total

Albania $725 $2,525 $3,250

Armenia 250 250 500

Austria 0 0 0

Azerbaijan 250 250 500

Belarus 500 500 1,000

Bulgaria 725 4,275 5,000

Czech Republic 1,100 8,900 10,000

Estonia 500 1,250 1,750

Finland 0 0 0

FYROMb 250 750 1,000

Georgia 500 250 750

Hungary 6,800 3,200 10,000

Kazakhstan 1,125 500 1,625

Kyrgyzstan 250 250 500

Latvia 500 1,250 1,750

Lithuania 500 1,250 1,750

Malta 0 0 0

Moldova 600 400 1,000

Poland 8,525 16,475 25,000

Romania 725 9,275 10,000

Russia 5,500 1,500 7,000

Slovakia 950 3,550 4,500

Slovenia 600 400 1,000

Sweden 0 0 0

Turkmenistan 250 250 500

Ukraine 7,500 2,500 10,000

Uzbekistan 1,375 250 1,625

Total $40,000 $60,000 $100,000

aForeign Military Financing in support of the Warsaw Initiative.

bFormer Yugoslav Republic of Macedonia.

The fiscal year 1996 Foreign Operations appropriation includes Foreign

Military Financing funding, $60 million of which the State Department

intends to use to support the Warsaw Initiative. Foreign Military Financing

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is a grant and loan program that provides financing for the acquisition of

military articles, services, and training through the Foreign Military Sales

system.10 This funding is provided through the State Department to

support transfers of equipment to enhance the interoperability of partner

forces with NATO, such as tactical radios, night vision equipment, and

command, control, and communications upgrades. In addition, this

funding is intended to support English language instruction and training to

familiarize partner defense officials with U.S. and NATO defense structure,

doctrine, and operations.

Of the $40 million of PFP funds provided through DOD in fiscal year 1996,

some is intended to pay for PFP member nations’ incremental costs

incurred as a result of participation in training exercises between 

U.S. forces and PFP partner nations. These funds are intended to be a

temporary measure to encourage partner governments to allocate a share

of their national budgets for participation in PFP. For example, according

to U.S. officials, Poland, Hungary, and the Czech Republic included PFP

funding in their 1995 budgets.

Through August 1995, there were 24 PFP exercises hosted at various

locations in Europe and the United States. The first of the exercises,

Cooperative Bridge, was held in Poland in mid-September 1994.

Cooperative Nugget, held August 11 through 26, 1995, at the Joint

Readiness Training Center at Fort Polk, Louisiana, was the first PFP

exercise hosted by the United States.

In addition to exercises, the $40 million provided through DOD will also

fund (1) studies in support of the Regional Airspace Initiative, (2) the

Defense Resource Management Study, and (3) PFP Information

Management System. The first two of these initiatives were originally

funded from other DOD accounts, but now are consolidated into the PFP

assistance program. At this time, DOD officials are uncertain as to what

portion of the $40 million will be allocated to each of these programs due

to limitations prohibiting these funds from being used to purchase

equipment that will be transferred to a foreign country.

The Regional Airspace Initiative is intended to modernize civilian and

military air traffic control, air sovereignty, and airspace management of

Central and Eastern European nations. According to DOD officials, the

initiative supports the U.S. policy that advocates peacetime control of

10All Foreign Military Financing funds provided for Central Europe and the Newly Independent States

in fiscal year 1996 are grants.

Page 10 GAO/NSIAD-96-92 NATO Enlargement
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national airspace by civil authorities, civil and military cooperation, and

information exchange throughout the region to build regional confidence

and security. Regional Airspace Initiative studies provide Central and

Eastern European nations, as well as the United States, with an

architecture for system modernization which will make air travel safer for

all nations flying in the region.

The Defense Resource Management Study is an Office of the Secretary of

Defense-sponsored and -managed initiative to help emerging Eastern

European democracies develop defense planning, programming, and

budgeting systems compatible with those of NATO countries. The Office of

the Secretary of Defense makes available teams of analysts to advise their

host country counterparts on compiling force capability and cost data and

analyzing alternative force structures. Fiscal year 1995 funding supported

such studies in Bulgaria, Romania, Hungary, and Albania.

The PFP Information Management System is intended to develop basic

communications capabilities with cooperating nations and international

organizations. It is intended to assist PFP members to become more

interoperable with NATO. A processing center at Caserne Daumerie,

Belgium, will provide capabilities such as real-time dial-up voice

communications, data conferencing, imagery storage and exchange, and

electronic mail. According to DOD, partner countries must pay a share of

the costs to participate in the PFP Information Management System. In

fiscal year 1995, $4 million of Office of the Secretary of Defense/Joint Staff

funds supported DOD costs associated with the PFP Information

Management System.

Joint Contact Team

Program

The Joint Contact Team Program is a bilateral effort, conducted by the

U.S. European Command, in coordination with U.S. embassy and host

nation military personnel, to ensure constructive military activities and to

model successful civil-military relations in a democracy. Rather than

conducting formal training or supplying equipment, military liaison teams

exchange ideas, share concepts, and demonstrate operational methods to

host nation military personnel.

The Joint Contact Team Program is executed by the Joint Chiefs of Staff,

in coordination with the Defense Security Assistance Agency. Funding for

the Joint Contact Team Program in Europe increased from $6 million in

fiscal year 1993 to $10 million in fiscal year 1994. In fiscal year 1995,

$10 million was provided through the Foreign Operations appropriation.

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For fiscal year 1996, $15 million was allocated by DOD to support the Joint

Contact Team Program as a Traditional Commander-in-Chief Activity in

the European theater (see app. II for a country-by-country breakdown of

fiscal year 1995 Joint Contact Team Program funding).

International Military

Education and Training

Established in the late 1950s, the International Military Education and

Training program provides military education and training on a grant basis

to allied and friendly nations’ militaries for such things as (1) increasing

their exposure to the proper role of the military in a democratic society,

including human rights issues, and to U.S. professional military education

and (2) helping to develop the capability to teach English.

In fiscal year 1991, DOD began implementation of the congressionally

directed Expanded International Military Education and Training program,

which addresses management of military establishments and budgets,

civilian control of military, and military justice and codes of conduct. It is

available to civilian and military officials, including nondefense agency

civilians. Also in 1991, Central and Eastern European countries began to

receive International Military Education and Training funding.

Program funds are largely used to transport, train, and provide a

supplemental living allowance for foreign students at military training

facilities in the United States, or to send training instructors in-country.

Funds have also been used to purchase English language laboratory

equipment at in-country facilities.

The International Military Education and Training program is funded

through the Foreign Operations appropriation. Recipient nations are

selected by the State Department with input from the Joint Chiefs of Staff

and DOD. DOD implements the program through the Defense Security

Assistance Agency.

Total worldwide International Military Education and Training program

funding in fiscal year 1995 was $26.35 million. Of this amount, about

$6 million went to PFP member countries. The fiscal year 1996

appropriation for the program totals $39 million, of which $10.2 million is

designated for PFP member countries (see app. III for a country-by-country

breakdown of funding for fiscal years 1995 and 1996). According to U.S.

European Command officials, some of the fiscal year 1996 International

Military Education and Training money allocated to the U.S. European

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Command is expected to be used for the purchase of language laboratory

equipment in Europe.

Excess Defense Articles

Transfer

Excess Defense Articles are those items owned by the U.S. government

that are in excess of approved retention levels. These items may be

transferred to a foreign country through the Foreign Military Sales

program or by grant transfer. The recipient nation is generally responsible

for the cost of transporting the items, upgrading them to meet their needs,

maintaining the articles, and disposing of them when they have outlived

their usefulness. The fiscal year 1996 Foreign Operations Appropriations

Act included authority for DOD funds to be used to pay packing, crating,

handling, and transportation costs for nonlethal excess defense articles for

PFP countries.

In fiscal year 1995, $6.63 million worth of excess items was authorized for

transfer to PFP countries (see app. IV for a country-by-country breakdown

of these transfers). The types of items transferred included surface

vehicles, aircraft, and communications equipment. The total value of fiscal

year 1996 transfers will not be available from DOD until fiscal year 1997.

Potential Costs to

NATO and New

Members

NATO’s Potential Costs If NATO increases its membership, it will likely have to provide an

undetermined amount of common funding to help the new member

nations. Commonly funded programs receive money from one of three

NATO common budgets,11 funded by NATO member contributions. The

largest of these is the NATO Security Investment Program, formerly known

as the Infrastructure Program. The United States provides 23.3 percent of

NATO infrastructure project funding, the highest of any member state.

NATO funding for infrastructure projects in new member nations would be

limited to facilities and command, control, and communications systems

for those forces made available and accepted for NATO use. According to

U.S. officials, funding would also be limited to providing only the

11NATO’s common budgets are the Security Investment Program, the Military Budget, and the Civil

Budget.

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infrastructure that (1) is required to meet NATO interoperability standards,

(2) qualifies under the strict eligibility rules for common funding, and (3) is

afforded a high-priority by NATO military authorities. According to U.S.

officials, NATO funding for new members would probably be gradual, would

vary considerably, and would probably not exceed a total of $50 million

for any individual nation during the first 3 to 5 years of their membership

in NATO. Table 4 shows an illustrative example of the costs of required

systems that may be funded by NATO.

Table 4: Illustrative Infrastructure

Costs Per New NATO Member Dollars in millions

System or facility

Approximate cost per new

member

Command and control information systems at

headquarters facilities $10

Communications systems 5

Air defense radara 30

Air defense control centers 25

Collocated operating base 50 to 75

Prepositioned material storage site 25

aSome nations may receive more than one radar, thus increasing the cost by an additional

$30 million per radar.

Source: Compiled in 1995 by U.S. Mission to NATO from NATO Planning Documents.

These are only some of the many potential costs. NATO may also consider

funding the construction of fuel pipeline extensions, reinforcement and

mobilization facilities, ammunition and fuel bunkers, port handling

facilities, transportation infrastructure (such as rail and road systems),

and facilities for any forward deployed forces in new members’ territory,

provided these projects are afforded a high priority by NATO authorities.

Ultimately, NATO will need to determine the systems and facilities to be

provided to new members. However, neither NATO nor the United States

know what the total costs of enlargement will be to NATO or individual

members, both current and new. NATO will make a case-by-case analysis of

its military needs and the requirements of new members as they join.

NATO’s commonly funded infrastructure program is capped at an

approximately $800-million annual ceiling.12 This means that common

12Within NATO, this cap is expressed in Infrastructure Accounting Units. While the exchange rate

between the U.S. dollar and the Infrastructure Accounting Unit fluctuates over time, NATO generally

refers to the rate as $4 per Infrastructure Accounting Unit. The current actual exchange rate is $4.63

per Infrastructure Accounting Unit.

Page 14 GAO/NSIAD-96-92 NATO Enlargement
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funding will be limited for new members, unless NATO removes the ceiling

or current members contribute more. According to officials at the U.S.

Mission to NATO, most NATO members have generally reduced defense

budgets in recent years, and it is unlikely that they would make larger

contributions to the infrastructure fund in the near term. However,

according to these officials, most of NATO’s commonly funded projects will

be completed by the end of 1997. This could allow common funds to be

directed to projects in new member states if the budget remained at

$800 million. In commenting on the draft of this report, DOD indicated that

the backlog of NATO commonly funded projects will continue past the

planning period. We were unable to verify which of these scenarios is

accurate.

New Members’ Potential

Costs

Many of the costs resulting from NATO enlargement would be expected to

be borne by the new members themselves. The total potential costs that

could be incurred by each new NATO member to upgrade its military

capabilities cannot be fully determined at this time because NATO has yet to

define country-specific military requirements.

New member countries may have to spend millions of dollars teaching

English language skills, developing tactical communications systems

(other than those funded by NATO), and learning NATO military doctrine. In

addition, some nations may need to change their force structure or

purchase new equipment to be compatible with those of NATO.

Interoperability with NATO is a specific goal of PFP and its joint exercises.

Interoperability is gaining increased importance under NATO’s Joint

Combined Task Force concept, which envisions NATO allies operating with

non-NATO nations in military operations using NATO forces and command

and control assets.

Most of the former Warsaw Pact nations may have to change from a

divisional structure to a brigade-based structure to make their ground

forces more compatible with NATO forces. For example, according to

Polish and U.S. officials, Poland is reducing the level of its armed forces

and transitioning to a brigade-based structure for its army. In addition,

Poland is forming an airmobile brigade that will have a rapid reaction

capability, a capability called for in NATO’s new strategic concept. Poland

intends for this brigade to be as interoperable with similar NATO forces as

possible, whether Poland is a member of NATO or not.

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New members will also be expected to bear the costs of participating in

NATO—such as maintaining a mission at NATO headquarters and

contributing to NATO’s three commonly funded budgets. Like current NATO

members, new member states’ participation in NATO commonly funded

budgets will be on a cost-share basis negotiated with NATO.

According to U.S. officials, most of the aspiring NATO members are facing

financial constraints and can realistically expect to do very little on their

own in the next several years to make their military systems compatible

with NATO’s systems. For example, according to U.S. officials, the Czech

defense budget is only about $1 billion. The most that may be expected of

these nations is gradual movement toward interoperability. For example,

the Czechs have a 10-year modernization plan to upgrade their equipment

and become interoperable with NATO forces.

Agency Comments In commenting on the draft of this report, the State Department

emphasized the U.S. leadership role in support of NATO’s enlargement

process and the link between PFP membership and a partner state’s

readiness for potential NATO membership. We have made changes

reflecting these points in the report. State Department officials also

indicated that estimates of the amount NATO may have to pay to support

new members are “extremely soft, unsubstantiated numbers,” and

characterized them as pure speculation. The figures were provided to us

by officials at the U.S. mission to NATO and represent the best available

information at this time.

DOD indicated that our description of the purpose of DOD funding support

for the Warsaw Initiative needed to be changed and we have modified the

report in response to this concern. Specifically in regard to the Regional

Airspace Program, DOD stated that the intent of the Regional Airspace

Program is to provide information to U.S. consumers. However, DOD

previously provided documents stating that the purpose of the program is

“for modernizing . . . airspace management for nations of the Central and

Eastern European region.”

DOD also indicated that our characterization of the Security Investment

Program funding is incorrect. DOD contends that the “backlog of NATO

commonly funded projects will continue past the planning period.”

Officials at DOD and at the U.S. Mission to NATO provided conflicting

information. We modified our report to clarify that the information as

presented was provided by officials at the U.S. Mission to NATO.

Page 16 GAO/NSIAD-96-92 NATO Enlargement
B-270972 

DOD and the Department of State provided also technical corrections that

have been incorporated in the report where appropriate. State and DOD

comments are presented in their entirety in appendixes V and VI,

respectively.

Scope and

Methodology

To develop the information in this report, we interviewed officials and

reviewed documents at the U.S. Mission to NATO, the U.S. European

Command, the Defense Intelligence Agency, DOD, and State. We also

conducted field work in Prague and Warsaw, where we interviewed and

obtained information from U.S. embassy officials and Czech and Polish

officials from the Ministries of Defense and Foreign Affairs.

We performed our work from April 1995 to March 1996 in accordance with

generally accepted government auditing standards.

As arranged with your office, unless you publically announce its contents

earlier, we plan no further distriubution until 15 days after its issue date.

At that time, copies of the report will be sent to other appropriate

congressional committees and the Secretaries of Defense and State. We

will also make copies available to other parties upon request.

Please contact me at (202) 512-4128 if you or your staff have any questions

concerning this report. Major contributors to this report were F. James

Shafer, David J. Black, Charnel F. Harlow, and Michelle F. Kidd.

Sincerely yours,

Harold J. Johnson

Associate Director, International

 Relations and Trade Issues

Page 17 GAO/NSIAD-96-92 NATO Enlargement
Contents

Letter 1

Appendix I 

The North Atlantic

Treaty Signed in

Washington D.C.,

April 4, 1949

20

Appendix II 

Funding Distribution

for Joint Contact

Team Program, Fiscal

Year 1995

24

Appendix III 

Funding Distribution

for International

Military Education

and Training Program,

Fiscal Years 1995 and

1996

25

Appendix IV 

Current Value of

Excess Defense

Articles That Services

Have Authorized for

Transfer to PFP

Member Nations,

Fiscal Year 1995

26

Page 18 GAO/NSIAD-96-92 NATO Enlargement
Contents

Appendix V 

Comments From the

Department of State

27

Appendix VI 

Comments From the

Department of

Defense

29

Tables Table 1: NATO Civil Budget NACC and PFP Funding, Calendar

Years 1991-96

4

Table 2: U.S. Bilateral Assistance to PFP Member States, Fiscal

Years 1995 and 1996

7

Table 3: PFP Support Programs and Bilateral Assistance, Fiscal

Year 1996

9

Table 4: Illustrative Infrastructure Costs Per New NATO Member 14

Abbreviations

DOD Department of Defense

NACC North Atlantic Cooperation Council

NATO North Atlantic Treaty Organization

PFP Partnership for Peace

Page 19 GAO/NSIAD-96-92 NATO Enlargement
Appendix I 

The North Atlantic Treaty Signed in

Washington D.C., April 4, 1949

The Parties to this Treaty reaffirm their faith in the purposes and

principles of the Charter of the United Nations and their desire to live in

peace with all peoples and all governments.

They are determined to safeguard the freedom, common heritage and

civilization of their peoples, founded on the principles of democracy,

individual liberty and the rule of law.

They seek to promote stability and well-being in the North Atlantic area.

They are resolved to unite their efforts for collective defense and for the

preservation of peace and security.

They therefore agree to this North Atlantic Treaty:

Article 1 The Parties undertake, as set forth in the Charter of the United Nations, to

settle any international disputes in which they may be involved by

peaceful means in such a manner that international peace and security,

and justice, are not endangered, and to refrain in their international

relations from the threat or use of force in any manner inconsistent with

the purposes of the United Nations.

Article 2 The Parties will contribute toward the further development of peaceful

and friendly international relations by strengthening their free institutions,

by bringing about a better understanding of the principles upon which

these institutions are founded, and by promoting conditions of stability

and well-being. They will seek to eliminate conflict in their international

economic policies and will encourage economic collaboration between

any or all of them.

Article 3 In order more effectively to achieve the objectives of this Treaty, the

Parties, separately and jointly, by means of continuous and effective

self-help and mutual aid, will maintain and develop their individual and

collective capacity to resist armed attack.

Article 4 The Parties will consult together whenever, in the opinion of any of them,

the territorial integrity, political independence or security of any of the

Parties is threatened.

Article 5 The Parties agree that an armed attack against one or more of them in

Europe or North America shall be considered an attack against them all;

and consequently they agree that, if such an armed attack occurs, each of

Page 20 GAO/NSIAD-96-92 NATO Enlargement
Appendix I 

The North Atlantic Treaty Signed in

Washington D.C., April 4, 1949

them, in exercise of the right of individual or collective self-defence

recognized by Article 51 of the Charter of the United Nations, will assist

the Party or Parties so attacked by taking forthwith, individually and in

concert with the other Parties, such action as it deems necessary,

including the use of armed force, to restore and maintain the security of

the North Atlantic area.

Any such armed attack and all measures taken as a result thereof shall

immediately be reported to the Security Council. Such measures shall be

terminated when the Security council has taken the measures necessary to

restore and maintain international peace and security.

Article 61 For the purposes of Article 5, an armed attack on one or more of the

Parties is deemed to include an armed attack:

• on the territory of any of the Parties in Europe or North America, on the

Algerian Departments of France,2

 on the territory of Turkey or on the

islands under the jurisdiction of any of the Parties in the North Atlantic

area north of the Tropic of Cancer;

• on the forces, vessels, or aircraft of any of the Parties, when in or over

these territories or any other area in Europe in which occupation forces of

any of the Parties were stationed on the date when the Treaty entered into

force or the Mediterranean Sea or the North Atlantic area north of the

Tropic of Cancer.

Article 7 The Treaty does not affect, and shall not be interpreted as affecting, in any

way the rights and obligations under the Charter of the Parties which are

members of the United Nations, or the primary responsibility of the

Security Council for the maintenance of international peace and security.

Article 8 Each Party declares that none of the international engagements now in

force between it and any other of the Parties or any third state is in

conflict with the provisions of this Treaty, and undertakes not to enter into

any international engagement in conflict with this Treaty.

Article 9 The Parties hereby establish a council, on which each of them shall be

represented, to consider matters concerning the implementation of this

Treaty. The council shall be so organized as to be able to meet promptly at

1

As amended by Article 2 of the Protocol to the North Atlantic Treaty on the accession of Greece and

Turkey.

2

On January 16, 1963, the Council noted that insofar as the former Algerian Departments of France

were concerned, the relevant clauses of this Treaty had become inapplicable as from 3 July, 1962.

Page 21 GAO/NSIAD-96-92 NATO Enlargement
Appendix I 

The North Atlantic Treaty Signed in

Washington D.C., April 4, 1949

any time. The council shall set up such subsidiary bodies as may be

necessary; in particular it shall establish immediately a defense committee

which shall recommend measures for the implementation of Articles 3 

and 5.

Article 10 The Parties may, by unanimous agreement, invite any other European

state in a position to further the principles of this Treaty and to contribute

to the security of the North Atlantic area to accede to this Treaty. Any

state so invited may become a Party to the Treaty by depositing its

instrument of accession with the Government of the United States of

America. The Government of the United States of America will inform

each of the Parties of the deposit of each such instrument of accession.

Article 11 This Treaty shall be ratified and its provisions carried out by the Parties in

accordance with their respective constitutional processes. The

instruments of ratification shall be deposited as soon as possible with the

Government of the United States of America, which will notify all the

other signatories of each deposit. The Treaty shall enter into force

between the states which have ratified it as soon as the ratification of the

majority of the signatories, including the ratification of Belgium, Canada,

France, Luxembourg, the Netherlands, the United Kingdom, and the

United States, have been deposited and shall come into effect with respect

to other states on the date of the deposit of their ratifications.3

Article 12 After the Treaty has been in force for 10 years, or at any time thereafter,

the Parties shall, if any of them so requests, consult together for the

purpose of reviewing the Treaty, having regard for the factors then

affecting peace and security in the North Atlantic area, including the

development of universal as well as regional arrangements under the

Charter of the United Nations for the maintenance of international peace

and security.

Article 13 After the Treaty has been in force for 20 years, any Party may cease to be a

Party 1 year after its notice of denunciation has been given to the

Government of the United States of America, which shall inform the

Governments of the other Parties of the deposit of each such notice of

denunciation.

Article 14 This Treaty, of which the English and French texts are equally authentic,

shall be deposited in the archives of the Government of the United States

3

The Treaty came into force on August 24, 1949, after the deposit of the ratification of all signatory

states.

Page 22 GAO/NSIAD-96-92 NATO Enlargement
Appendix I 

The North Atlantic Treaty Signed in

Washington D.C., April 4, 1949

of America. Duly certified copies thereof will be transmitted by that

Government to the Governments of the other signatories.

Page 23 GAO/NSIAD-96-92 NATO Enlargement
Appendix II 

Funding Distribution for Joint Contact Team

Program, Fiscal Year 1995

Dollars in thousands

Recipient Funding

Albania $553

Armenia 0

Austria 0

Azerbaijan 0

Belarus 0

Bulgaria 632

Czech Republic 632

Estonia 790

Finland 0

Georgia 0

Hungary 553

Kazakhstan 0

Kyrgyzstan 0

Latvia 948

Lithuania 1,027

Malta 0

Moldova 0

Poland 553

Romania 711

Russia 0

Slovakia 395

Slovenia 553

Sweden 0

Turkmenistan 0

Ukraine 0

Uzbekistan 0

Headquarters Support 553

TTADa 2,100

Total $10,000

aTemporary tours of active duty (staffing for reserve component personnel).

Page 24 GAO/NSIAD-96-92 NATO Enlargement
Appendix III 

Funding Distribution for International

Military Education and Training Program,

Fiscal Years 1995 and 1996

Dollars in thousands

Recipient FY 1995 FY 1996

Albania $226 $400

Armenia 0 0

Austria 15 15

Azerbaijan 0 0

Belarus 94 275

Bulgaria 400 700

Czech Republic 500 750

Estonia 180 410

Finland 15 15

FYROMa 0 0

Georgia 82 250

Hungary 796 1000

Kazakhstan 97 375

Kyrgyzstan 60 225

Latvia 197 410

Lithuania 196 410

Malta 58 75

Moldova 106 225

Poland 747 1000

Romania 460 700

Russia 413 750

Slovakia 253 530

Slovenia 150 300

Sweden 0 0

Turkmenistan 118 225

Ukraine 707 950

Uzbekistan 95 225

Total $5,965 $10,215

aFormer Yugoslav Republic of Macendonia.

Page 25 GAO/NSIAD-96-92 NATO Enlargement
Appendix IV 

Current Value of Excess Defense Articles

That Services Have Authorized for Transfer

to PFP Member Nations, Fiscal Year 1995

In U.S. dollars

Recipient FY 1996

Albania $609,164

Armenia 0

Austria 0

Azerbaijan 0

Belarus 0

Bulgaria 452,818

Czech Republic 0

Estonia 658,994

Finland 0

FYROMa 0

Georgia 0

Hungary 80

Kazakhstan 0

Kyrgyzstan 0

Latvia 268,469

Lithuania 291,651

Malta 0

Moldova 0

Poland 0

Romania 4,337,329

Russia 0

Slovakia 10,598

Slovenia 0

Sweden 0

Turkmenistan 0

Ukraine 0

Uzbekistan 0

Total $6,629,103

aFormer Yugoslav Republic of Macendonia.

Page 26 GAO/NSIAD-96-92 NATO Enlargement
Appendix V 

Comments From the Department of State

Page 27 GAO/NSIAD-96-92 NATO Enlargement
Appendix V 

Comments From the Department of State

Page 28 GAO/NSIAD-96-92 NATO Enlargement
Appendix VI 

Comments From the Department of Defense

Now on p. 10.

Now on p. 10.

Page 29 GAO/NSIAD-96-92 NATO Enlargement
Appendix VI 

Comments From the Department of Defense

Now on p. 10.

Now on p. 11.

Now on p. 13.

Page 30 GAO/NSIAD-96-92 NATO Enlargement
Appendix VI 

Comments From the Department of Defense

Now on p. 2.

Now on p. 9.

Now on p. 9.

Now on p. 11.

(711153) Page 31 GAO/NSIAD-96-92 NATO Enlargement
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