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88–459PDF 2014

REVIEWING THE ADMINISTRATION’S FY 2015

BUDGET REQUEST FOR EUROPE AND EURASIA

HEARING

BEFORE THE

SUBCOMMITTEE ON EUROPE, EURASIA, AND 

EMERGING THREATS

OF THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED THIRTEENTH CONGRESS

SECOND SESSION

JUNE 25, 2014

Serial No. 113–170

Printed for the use of the Committee on Foreign Affairs

(

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

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

(II)

COMMITTEE ON FOREIGN AFFAIRS 

EDWARD R. ROYCE, California, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

ILEANA ROS-LEHTINEN, Florida 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

JOE WILSON, South Carolina 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

MATT SALMON, Arizona 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

ADAM KINZINGER, Illinois 

MO BROOKS, Alabama 

TOM COTTON, Arkansas 

PAUL COOK, California 

GEORGE HOLDING, North Carolina 

RANDY K. WEBER SR., Texas 

SCOTT PERRY, Pennsylvania 

STEVE STOCKMAN, Texas 

RON DESANTIS, Florida 

DOUG COLLINS, Georgia 

MARK MEADOWS, North Carolina 

TED S. YOHO, Florida 

SEAN DUFFY, Wisconsin 

ELIOT L. ENGEL, New York 

ENI F.H. FALEOMAVAEGA, American 

Samoa 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

BRIAN HIGGINS, New York 

KAREN BASS, California 

WILLIAM KEATING, Massachusetts 

DAVID CICILLINE, Rhode Island 

ALAN GRAYSON, Florida 

JUAN VARGAS, California 

BRADLEY S. SCHNEIDER, Illinois 

JOSEPH P. KENNEDY III, Massachusetts 

AMI BERA, California 

ALAN S. LOWENTHAL, California 

GRACE MENG, New York 

LOIS FRANKEL, Florida 

TULSI GABBARD, Hawaii 

JOAQUIN CASTRO, Texas

AMY PORTER, Chief of Staff THOMAS SHEEHY, Staff Director

JASON STEINBAUM, Democratic Staff Director 

SUBCOMMITTEE ON EUROPE, EURASIA, AND EMERGING THREATS

DANA ROHRABACHER, California, Chairman 

TED POE, Texas 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

PAUL COOK, California 

GEORGE HOLDING, North Carolina 

STEVE STOCKMAN, Texas 

WILLIAM KEATING, Massachusetts 

GREGORY W. MEEKS, New York 

ALBIO SIRES, New Jersey 

BRIAN HIGGINS, New York 

ALAN S. LOWENTHAL, California 

(III)

C O N T E N T S 

Page

WITNESSES 

Mr. Daniel Rosenblum, Coordinator of U.S. Assistance to Europe and Eurasia, 

Bureau of European and Eurasian Affairs, U.S. Department of State ........... 4

Mr. Jonathan Katz, Deputy Assistant Administrator, Bureau for Europe and 

Eurasia, U.S. Agency for International Development ....................................... 17

Ms. Denise Rollins, Acting Assistant Administrator, Bureau for Asia, U.S. 

Agency for International Development .............................................................. 24

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Mr. Daniel Rosenblum: Prepared statement ......................................................... 7

Mr. Jonathan Katz: Prepared statement ............................................................... 19

Ms. Denise Rollins: Prepared statement ............................................................... 26

APPENDIX 

Hearing notice .......................................................................................................... 44

Hearing minutes ...................................................................................................... 45

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REVIEWING THE ADMINISTRATION’S FY 2015

BUDGET REQUEST FOR EUROPE AND 

EURASIA 

WEDNESDAY, JUNE 25, 2014

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON EUROPE, EURASIA, AND EMERGING THREATS,

COMMITTEE ON FOREIGN AFFAIRS,

Washington, DC. 

The subcommittee met, pursuant to notice, at 2:05 p.m., in room 

2200, Rayburn House Office Building, Hon. Dana Rohrabacher 

(chairman of the subcommittee) presiding. 

Mr. ROHRABACHER. I call this hearing of the Europe, Eurasia, 

and Emerging Threats subcommittee to order. This hearing is entitled, ‘‘Reviewing the Administration’s Fiscal Year 2015 Budget Request for Europe and Eurasia. 

Now, all members will have 5 legislative days to submit additional written questions or extraneous materials for the record. 

The President has asked that Congress authorize over $50 billion 

for international affairs programs for the next fiscal year. Over 

$620 million of that is allotted for countries in the jurisdiction of 

this subcommittee. This request comes at a time when our Government’s debt is over $16 trillion and rising, rising at $500 billion 

more in debt every year. 

At a time when our own country’s economy continues to struggle, 

Congress has a duty to scrutinize this administration’s request, 

and the request to provide the development assistance, and foreign 

aid to other countries is certainly something that we need to look 

at closely. Western Europe is often cited as one of the greatest examples of U.S. foreign assistance success. After World War II, the Marshall Plan delivered $13 billion to 

help rebuild a shattered Europe and prevent the advance of Communism. As much as American aid dollars helped to relieve suffering, it was implemented in a way that connected it to a larger 

U.S. grand strategy, so we were not only helping others but involved with our overall global strategy. 

Furthermore, the German Government took upon itself to conduct reforms that removed extensive price controls and other restrictions on trade, production, and the distribution of goods, and 

those efforts on the part of the German Government did much to 

rebuild that economy. The success of the Marshall Plan highlights 

two key aspects for our international affairs efforts. First, any aid 

must be linked to a strategy and part of a coherent vision that 

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serves our country’s national interest. Second, true and sustainable 

development grows not from foreign assistance but from systematic 

economic reform. Economies grow when the rule of law is established, corruption is reduced, taxes are low, markets are open, and 

trade is free. 

I believe that our aid programs today fail to adequately appreciate these two attributes and too often resemble charitable handouts. Let me note, there is a grave distinction between humanitarian assistance and development aid. 

Of course, we should be ready to respond to natural disasters, 

earthquakes, and the likes. However, development funds can’t work 

if the recipient countries do not undertake sound economic reforms. 

The role of government assistance is not to replace private investment. I look forward to hearing from our witnesses about how more 

than $600 million has been requested and how this furthers America’s strategic interest and is effectively encouraging countries to 

reform their own economies so that private capital can lift their 

people out of poverty. 

With that, I turn to my ranking member, Congressman Keating, 

for his opening statement. 

Mr. KEATING. Well, thank you, Mr. Chairman, for holding this 

important hearing today, and I want to welcome Mr. Rosenblum, 

Mr. Katz, and Ms. Rollins, who each have extensive experience in 

Europe and Eurasia. 

Since the collapse of the Soviet Union over two decades ago, the 

United States has worked to promote stability, democracy, and 

prosperity in Europe, Eurasia, and Central Asia. Our assistance efforts have supported the growth of civil society and independent 

media and have worked to establish societies where rule of law, accountable governance, and fundamental human rights prevail. 

Importantly, we have worked together with our European partners to help these countries on their self-determination path toward Westernvalues and institutions. 

Today, Russia’s efforts to destabilize Ukraine and other former 

Soviet states threaten to undermine our collective effort to build a 

Europe whole, free, and at peace. Russia’s illegal occupation and 

annexation of Crimea and its subsequent covert support for separatists in Eastern Ukraine have inflamed tensions throughout the 

entire region. Regrettably, Russia’s engagement in similar activities in Georgia, Moldova, and even the Baltics, in flagrant violation 

of Russia’s own international commitments, have undermined the 

sovereignty of these countries and unnecessarily increased the risk 

of conflict. These actions must not be allowed to stand. 

I am pleased that our partners, too, have shown they will not 

back down from aggression. This week, Ukraine, Georgia, and 

Moldova are signing association agreements with the European 

Union, and in doing so, they are making clear that their future lies 

in strong ties with the West. When these countries realize, as does 

the European Union, that the European integration is not a zero 

sum game, they realize the importance of close and productive ties 

with their regional neighbors, including Russia. In fact, I would 

argue that closer association with the EU is also in Russia’s longterm interest. 

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Ironically, Russia’s actions in Eastern Europe ultimately do the 

Russian people more harm than they do good. That is why today’s 

hearing is so important. We need to support these countries as they 

work together to build prosperous European democracies. In that 

light, I look forward to discussing the administration’s plans to reinvest the liquidation proceeds from the Western Newly Independent States Enterprise fund in Ukraine, also known as West 

NIS. Recent events in Ukraine show the population is no longer 

willing to tolerate corruption and crony capitalism that have permeated Ukraine’s politics for the past two decades. 

In the spirit of a fresh start, it makes sense to reinvest proceeds 

from the West NIS in Ukraine at zero cost to the American taxpayers, so we can help Ukraine’s pro-reform government stabilize 

their financial sector, improve the business climate and attract foreign investment, all of which will increase prosperity and all of 

which will promote stability. 

I also look forward to hearing from our experts about our strategies for continued engagement in the region, not just in Eastern 

Europe but also in the Balkans, Central Asia, and Ireland. No matter what country or region we are discussing, it is essential that 

the United States stands for the rule of law, democracy, and 

human rights. While we continue to have strong allies in Europe 

and Eurasia, we cannot take these important relationships for 

granted. I support a foreign affairs budget that is focused on continuing support for these relationships and ensuring that peace and 

democracy are allowed to flower. 

With that, I thank you, Mr. Chairman. 

Mr. ROHRABACHER. I thank you, and we have been joined by 

Congressman Lowenthal. 

Do you have a 1-minute opening statement or anything you 

would like to say? But you have to push the button. 

Mr. LOWENTHAL. I will do a 1-minute opening statement. First, 

I am pleased, thank you for holding this hearing, Chairman Rohrabacher and Ranking Member Keating. I just want to say that I, 

along with other—Chairman Royce and Ranking Member Engel, 

just before the May 25th election in early May, visited the Ukraine, 

and we are very glad to see the May 25th election. 

One of the things I was struck with was things that were—a 

number of things that Ranking Member Keating mentioned, issues 

around corruption, issues around how you unite Eastern—and 

what conditions we place on our foreign aid and our resources. 

Some of the issues that I was most concerned about was the disconnect between Eastern and Western Ukraine, some of the issues 

around reform that the government needed to do in terms of decentralization and more attention to the Russian heritage in folks from 

Eastern Ukraine, who felt that much of their—that they were 

being denied attention, and if there was going to be one Ukraine, 

the importance of bringing back all parts of that country. 

Mr. Poroshenko made a commitment to doing that, and—but he 

also made a commitment to moving toward the EU, and I think 

that when we were there, anyway, there was a lack of Russian language broadcast by the Ukrainians, and into Eastern Ukraine what 

was coming in was only from Russia, and so the people were only 

hearing one side, and there was that disconnect. And to bring peoVerDate 0ct 09 2002 14:13 Jul 31, 2014 Jkt 000000 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 F:\WORK\_EEET\062514\88459 SHIRL
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ple together, it is going to mean that all parts of the country, just 

as we see in Iraq and others, all segments have to be part of that 

government, and so I would just like to see how our foreign aid 

really advances democracy in Ukraine. Thank you. 

Mr. ROHRABACHER. Thank you very much, Mr. Lowenthal. 

And we have three witnesses today, and I will be reading their 

biographies and presenting that. 

But I would request that as we move into the time of the testimony, that you would give us your summary in about 5 minutes, 

and the rest, of course, can go into the record. 

We first have Daniel Rosenblum, who is the State Department 

coordinator for U.S. assistance to Europe and Eurasia. He oversees 

U.S. aid to over 30 countries, mostly in the former Soviet Union. 

His office coordinates those programs across more than a dozen 

U.S. Government agencies. 

Previously, Mr. Rosenblum was—served as director of the FREEDOM Support Act Division and the deputy coordinator for that 

same office. Before coming to the State Department, Mr. 

Rosenblum spent 6 years as a senior program coordinator at the 

Free Trade Union Institute of the AFL/CIO. He has a BA in history 

from Yale and an MA in Soviet studies and international economics 

from Johns Hopkins School of Advanced International Studies. 

And we have Mr. Jonathan Katz, who we have worked with over 

the years, and been on this side of the aisle—or this side of the 

table and that side of the table as he has worked as a USAID’s 

deputy assistance administrator for Europe and Eurasia, was appointed to his current post in March of this year. Previously, he 

served as a senior advisor to the assistant secretary of state and 

the Bureau of International Organizations Affairs. Katz joined the 

State Department 2010 after working, as I say, here on Capitol Hill 

for 13 years as a staff director, minority staff director for this very 

same subcommittee, and he also served as legislative director for 

Congressman Robert Wexler, who we miss. He is a graduate of Syracuse University. 

Finally, we have Ms. Denise Rollins, also from USAID. She is 

acting assistant administrator for the Asia Bureau. Before assuming her current role, she was a senior director—or deputy assistant 

administrator since 2011, that organization. Ms. Rollins has served 

as USAID’s mission director in Bangladesh and deputy missions director in South Africa. Before joining USAID, she worked as a legislative assistant to two Members of Congress. Ms. Rollins received 

a master’s of international public policy degree from Johns Hopkins 

University and a bachelor in arts degree in economics from Howard 

University. I would like to welcome our witnesses. 

And Mr. Rosenblum, you may proceed, and we will then ask 

questions of the entire group after all the testimonies have been 

given. 

STATEMENT OF MR. DANIEL ROSENBLUM, COORDINATOR OF 

U.S. ASSISTANCE TO EUROPE AND EURASIA, BUREAU OF EUROPEAN AND EURASIAN AFFAIRS, U.S. DEPARTMENT OF 

STATE 

Mr. ROSENBLUM. Thank you, Mr. Chairman. 

5

Thanks very much. Chairman Rohrabacher, Ranking Member 

Keating, Mr. Lowenthal, thank you all for inviting us to testify 

today on the Fiscal Year 2015 budget request for Europe, Eurasia, 

and Central Asia. 

For more than two decades, the U.S. has been working to support political and economic reform in the formerly Communist 

states of Central and Eastern Europe and the Soviet Union. During 

that entire period, successive administrations have received strong 

bipartisan support for this effort, backed up by generous appropriations totalling $25.4 billion over that 25-year period under the 

SEED and FREEDOM Support Acts. 

I want to start today by directly answering the question posed 

by the chairman in his statement that announced today’s hearing. 

The question was, is our aid to this region being used in a fiscally 

responsible manner that helps to put nations on a path to where 

that aid is no longer needed? The answer, in my humble opinion, 

is yes. From the very beginning of our work in the post-Communist 

region, the basic philosophy has been, our job is to work ourselves 

out of a job. We want to help countries get to the point where they 

no longer require development aid, and if you look at the track 

record, it is pretty good. There are some real successes. 

Eleven countries have graduated from development assistance. 

All of them are now aid donors themselves. All of them are members of the European Union and NATO. Other countries in the 

Western Balkans continue to make significant progress toward EU 

and NATO membership. A few countries in Eurasia and in Central 

Asia have also made substantial progress toward establishing free 

market economies and democratic political systems, and if we have 

time later in today’s hearing, I would like to tell you more about 

how we measure these trends and how we determine when it is 

time to phase out assistance. 

But my main message for the subcommittee today is that the 

goal of a Europe whole, free, and at peace isn’t achieved and our 

work isn’t done. I have outlined the remaining challenges in more 

detail in my written testimony, and Mr. Chairman, I ask permission that it appear in the hearing record. 

Mr. ROHRABACHER. Without objection. 

Mr. ROSENBLUM. Our requested budget for Europe, Eurasia, and 

Central Asia is $625.3 million, a decrease of nearly 17 percent, or 

$125 million as compared to Fiscal Year 2013, 2 fiscal years ago. 

I should note that this budget was finalized before the onset of the 

Ukraine crisis. Since that crisis began, the U.S. has provided 

Ukraine a $1-billion loan guarantee and has redirected approximately $131 million in crisis-related assistance to augment our regular bilateral budget. This was done by redirecting previously appropriated Fiscal Year 2013 and Fiscal Year 2014 funds from various other regional and global pots. 

We have not requested any additional funds from Congress to 

date. In Fiscal Year 2015, our strong interest in bolstering stability, sovereignty, and reform in Ukraine and other countries in 

the region will likely require adjustments to what we proposed 

nearly 5 months ago in the budget request, potentially including 

adjustments to overall levels. 

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Based on Appropriations Committee action in both House and 

Senate this week, it appears that Congress agrees with this assessment and may provide enhanced funding for this region. We look 

forward to final congressional action on Fiscal Year 2015 funding 

measures, and at that time, of course, we will be consulting with 

this committee and other committees on any proposed adjustments 

from what we requested for Fiscal Year 2015. 

So let me briefly, in the time remaining, outline five strategic objectives for our assistance to the region. First, we aim to enhance 

sovereignty, including the right of countries in the region to choose 

their own political and economic relationships. This is playing out 

today most dramatically in Ukraine, but it is an element in our assistant strategy throughout the region. In Central Asia, for example, we are helping countries in the region develop a diverse set of 

energy, trade, and transport linkages under the New Silk Road initiative. 

Second, we are supporting greater European integration for countries that seek it. This Friday, in Brussels, Moldova and Georgia 

will sign association agreements and deep and comprehensive free 

trade agreements with the EU. Ukraine will sign the remaining 

economic chapters of its association agreement. Many of our programs are helping these countries meet the necessary standards to 

implement these agreements. 

Third, we are working to help countries throughout the region 

take meaningful steps to root out corruption and shore up rule of 

law. We have seen that rampant corruption is like a cancer that 

drains economic vitality and undermines faith in democratic institutions. In the Western Balkans, we have seen some limited process in the context of the EU accession process, while in Eurasia 

and Central Asia serious challenges remain often due to a lack of 

the requisite political will to tackle the problem. 

Fourth, we are working to reverse the worrying trend of democratic backsliding. Our assistance aims at empowering those who 

seek to preserve and expand democratic principles, whether in 

independent media, the justice sector, democratic political parties, 

or other parts of civil society. Where possible, we seek to engage 

with government institutions that are open to reform. 

Fifth and finally, we are also supporting efforts to tackle broader 

security issues and transnational threats, ethnic tensions, protracted conflicts, infectious disease, organized crime, and weapons 

of mass destruction proliferation. The President’s Fiscal Year 2015 

request recognizes that even in a constrained budget environment, 

we can still utilize foreign assistance to advance U.S. national interests in Europe, Eurasia, and Central Asia. 

Going forward, we plan to maintain our 25-year tradition of 

working with Congress in a bipartisan manner to ensure that the 

resources that the American people provide for this purpose are 

being used in the most efficient and effective way possible to support stability, prosperity, and democracy in the region. Thank you. 

Mr. ROHRABACHER. Thank you very much. 

[The prepared statement of Mr. Rosenblum follows:]

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Mr. ROHRABACHER. Mr. Katz. 

STATEMENT OF MR. JONATHAN KATZ, DEPUTY ASSISTANT ADMINISTRATOR, BUREAU FOR EUROPE AND EURASIA, U.S. 

AGENCY FOR INTERNATIONAL DEVELOPMENT 

Mr. KATZ. Mr. Chairman, it is especially—it is special for me to 

be here before the committee today, so we appreciate the opportunity. Mr. Chairman——

Mr. ROHRABACHER. You are in the hot seat now. 

Mr. KATZ. Mr. Chairman, Ranking Member Keating, members of 

the subcommittee, thank you for inviting me to testify regarding 

the administration’s Fiscal Year 2015 budget request for Europe 

and Eurasia. American foreign assistance is a vital tool in our effort to realize the U.S. foreign policy goal of a Europe whole, free, 

and at peace. To achieve this goal in an era of shrinking budgets, 

we are focused on strategic areas of U.S. Assistance to Europe and 

Eurasia. 

The majority of assistance requested for the region will be targeted to support democratic, economic, justice sector, and other reforms, particularly those necessary for Euro-Atlantic integration. 

As the chairman and as the ranking member highlighted, over the 

past two decades, we have witnessed significant progress toward 

these goals, and many countries in Europe have embraced political 

and economic reform, leading to vibrant growth and inspired democratic transformations. 

From USAID’s 24 original partner countries in Europe and Eurasia, as Dan pointed out, 11 have graduated from our assistance, 

17 have joined the WTO, 11 have acceded to the EU, and 12 have 

joined NATO. The 11 countries that have graduated from our assistance are some of our strongest allies and are now providing economic assistance to other countries in the region. 

Despite these advances, the work is far from complete, gains are 

tenuous, and much remains to be done to make progress sustainable. We are working to assist those countries and people from Sarajevo to Tbilisi to Kiev, that seek to move forward on a path to 

an even greater Euro-Atlantic integration, democracy, and 

progress. 

In Europe and Eurasia, serious challenges remain, including 

democratic backsliding, gradual financial sectors, high unemployment, infectious diseases, ethnic violence and tension, frozen conflicts, energy insecurity, and corruption, which was mentioned a 

number of times. Perhaps most notably, external pressures destabilize Ukraine and others in the region, threatening economic and 

political development across the former Soviet space. 

Our Fiscal Year 2015 request for Europe and Eurasia addresses 

continuing and emergent U.S. policy objectives while also recognizing budget constraints here in Washington. Our assistance is focused on two main objectives, to continue to promote democracy 

and economic reform in Europe and Eurasia and to strengthen democracy, governance rule of law, and economic growth. One of our 

core objectives across the region is to promote civic—citizen engagement and strength in civil society to mitigate backsliding on democratic reforms and economic development. 

18

Ukraine offers a prime example of how USAID support for civil 

society and media groups helps stop or limit government pressure 

and freedom of expression and association. Our media programs 

played a critical role in monitoring and reporting on attacks on 

journalists and on government actions throughout the Euromaidan 

protests. 

Looking ahead, USAID will continue to play a pivotal role as we 

work to sustain and strengthen cooperation between Ukrainian 

civil society and Ukrainian Government. Already strong cooperation between civil society and the government has led to historic 

reforms over the past 4 months, but that progress needs to continue. 

I want to further highlight our assistance to Ukraine. Since 

1992, USAID has had a longstanding multifaceted engagement, focused on a more stable, democratic, and prosperous Ukraine, including on programs to promote economic reforms, support more 

democratic accountable governance, and combat HIV/AIDS and tuberculosis. Recent events in Ukraine, including the election of 

President Poroshenko and the response of the United States to 

them remain critical not only to Ukraine’s future but the region’s 

future as well. 

The U.S. is working with our international partners today to 

maximize and leverage assistance, provide urgently need support 

to Ukraine’s people and economy. Our approach in Ukraine is to 

support the goals and aspirations of all the people of Ukraine for 

piece, prosperity, freedom, and human dignity, what so many 

Ukrainians are demanding the Maidan. 

Fiscal Year 2015 U.S. Bilateral assistance package is focused on 

meeting Ukraine’s most pressing need and helping Ukraine make 

needed reforms. USAID’s assistance will focus on four areas, which 

Dan mentioned, strengthen Ukraine’s economy and promoting 

growth, support for constitutional reforms, national unity, confidence and confidence building measures, and help to diversify 

Ukraine’s trade and reduce its energy dependence, as well as to 

support a fight against corruption. Just last week, I joined USAID 

administrator Dr. Rashad in Kiev to announce an additional $10 

million in USAID funding that will be largely used to help Ukraine 

fight corruption. 

Mr. Chairman, Congressman Keating, members of the subcommittee, thank you again for this opportunity. The U.S. has a 

long track record of successful assistance to countries in Europe 

and Eurasia, but as the events of the last several months have 

demonstrated, there is much work to be done in this region. The 

Fiscal Year 2015 request will enable us to remain engaged in providing U.S. assistance in Europe and Eurasia at this critical moment. I will end there and look forward to answer any questions 

that you have. Thank you. 

Mr. ROHRABACHER. Thank you. 

[The prepared statement of Mr. Katz follows:]

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Mr. ROHRABACHER. Ms. Rollins. 

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

Ms. ROLLINS. Thank you so much, Mr. Chairman. 

Mr. Chairman, Ranking Member Keating, and Mr. Lowenthal, I 

am delighted to be here today to testify alongside my colleagues 

here on the administration’s 2015 budget for Central Asia. This 

afternoon I wanted to share with you our perspective on the vital 

role of USAID’s development programs in Kazakhstan, the Kyrgyz 

Republic, Tajikistan, Turkmenistan, and Uzbekistan in addressing 

regional challenges and advancing American interests. 

More than 20 years after the region first opened its doors to 

international engagement, American involvement provides balance 

as well as choice for a disparate collection of countries that face 

ever more complex challenges in determining their own futures. 

These challenges will become even more formidable during the next 

5 years or so against the backdrop of uncertainty in Afghanistan. 

Rising geopolitical interest of Russia, growing Chinese influence 

and looming political transition across the region where the Soviet 

legacy continues to have an important impact. 

From the U.S. perspective, active engagement in Central Asia 

and especially the good will and cooperation that result from well 

designed and well implemented assistance programs can help to establish a lasting alternative to forces that would otherwise destabilize the region. 

The President’s Fiscal Year 2015 budget request for Central Asia is $133 million, which will enable both the State Department and 

USAID to continue to play an integral role in strengthening democratic systems of governance and diversifying economies. USAID’s 

development assistance to the Central Asian republics also includes 

meeting urgent human needs through a focus on health, agriculture, and other issues, such as combatting human trafficking. 

To help—this is to help ensure countries grow peacefully and 

sustainably with the wherewithal to determine their own futures. 

So we are tackling complex regional challenges and advancing 

U.S. foreign policy through three development approaches. Number 

one, increasing regional economic cooperation and connectivity, 

which will help accelerate private-sector-led trade and yield greater 

prosperity and stability across the region as more cross-border ties 

are forged. Number two, we are addressing regional development 

challenges through the three Presidential initiatives: The Global 

Health Initiative, Feed the Future, and Global Clinate Change Initiative. Number three, we are leveraging our new business model, 

which is science, technology, innovation, and partnership, STIP, as 

we call it, which will extend our reach and maximize our impact 

while driving down cost and yielding a better return for the American taxpayer. 

Regional economic connectivity matters because while trade figures remain modest for now, greater economic dynamism across 

the region can provide future opportunities for international businesses, especially in key areas, such as the services industry, energy, mining, higher education, and infrastructure. USAID contribVerDate 0ct 09 2002 14:13 Jul 31, 2014 Jkt 000000 PO 00000 Frm 00028 Fmt 6633 Sfmt 6633 F:\WORK\_EEET\062514\88459 SHIRL
25

utes to U.S. Government efforts under the New Silk Road initiative 

to increase regional economic connectivity between the economies 

of the peoples of South and Central Asia and, ultimately, foster 

greater political and socioeconomic stability across the broader region. 

While originally envisioned as a means to aid in Afghanistan’s 

transition post-2014, our work toward regional connectivity in Central Asia is all the more critical in the current context of Russia’s 

reassertion of influence in former Soviet spaces. 

This regional focus continues through the implementation of the 

three Presidential initiatives. 

Throughout our work in this constrained budget environment, 

USAID is utilizing a new model of development that promotes partnerships and harnesses science, technology, and innovation to enhance development outcomes and maximize impact. 

Across Asia, we are leveraging new talent and resources wherever possible—from the growing private sector to expanded donor 

collaboration. A prime example of how we utilize this approach is 

in Turkmenistan, for example, where through an innovative publicprivate partnership with Junior Achievement and Chevron, USAID 

is equipping young people in that country with practical skills that 

better prepare them to find jobs upon graduation, and it makes 

schooling more relevant to the demands of the modern job market. 

Finally, we are leveraging greater funding and support of development programs from emerging donors, and you heard my colleagues mention this, such as the Government of Kazakhstan. For 

the past several years, the Kazakh Government has provided twothirds of the total funding for our economic development programming and is poised to provide an even larger share of funding over 

the next several years. 

Mr. Chairman, in today’s interconnected world, our success addressing development challenges in Central Asia matters more 

than ever. Continued USAID assistance is vital in order to sustain 

gains and contribute to increased stability and prosperity in a part 

of the world where progress can pay dividends across the border region. I appreciate the opportunity to share what USAID is doing 

in Central Asia and look forward to your guidance. Thank you. 

[The prepared statement of Ms. Rollins follows:]

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Mr. ROHRABACHER. I thank all of our witnesses for your concise 

and very to the point testimony today. 

And the chairman intends to yield to the ranking member as 

well as to Congressman Lowenthal so that they will have their 

time to ask questions first, and then I will take advantage of my 

opportunity after they are done. 

You may proceed, Mr. Keating. 

Mr. KEATING. Well, thank you, Mr. Chairman, and I look forward 

to working together with all of you for the type of assistance you 

describe in your testimony to Georgia, Moldova, and Ukraine, and 

despite the constraints we have on our budget during this very difficult fiscal time, I am convinced that in the right situations, Congress will continue to do the right thing. 

However, I just want to make clear, and I think I speak for many 

members, that it is essential that the administration help us make 

the case to our constituents here at home, that this money is spent 

wisely, and two of you have mentioned specifically the pervasive 

nature of corruption in Ukraine and through some of the countries 

in this region. I just wanted you to comment on what kind of safeguards the administration has put in place on U.S. assistance on 

the funds to Ukraine Government, those funds being raised 

through the U.S. loan guarantees in particular, and also comment 

on any assurances that these funds won’t be used to pay debts to 

Russia. 

Mr. ROSENBLUM. So thank you for that question, Mr. Keating. It 

is obviously something that is of great concern to us as well, and 

we know we have to make the case to the American taxpayer that 

their money is being well spent. On the—specifically on the loan 

guarantee, we provided that on the basis of a written agreement 

with the Ukrainian Government in which they undertook certain—

they made certain commitments, one of which was that the money 

would be used for the purposes that we agreed on, which were to 

contribute to their ability to meet obligations to the population and 

social spending. 

The adjustments that Ukraine has had to made as a result of the 

IMF program have created and potentially will create more hardship for the population because they are dealing with a legacy of 

many, many years of inefficient and poorly targeted subsidies 

through their social safety net system. That is being changed now 

with help from the World Bank, but in the meantime, there is 

going—there is going to be some short-term dislocation and pain, 

so we felt it was important for our funds to go in that direction. 

The funds, as you know, are—were raised by the Ukrainian Government itself through a bond issuance that our guarantee helped 

to make possible and then went into their general treasury to be 

spent for the purpose of these—the social payments. I will just 

make a general—more general point about the risk of corruption 

and diversion of funds, and that is that this mechanism for support 

that we provided in the case of Ukraine in May was very unusual 

for us, and I can only think, in the years that I have been doing 

this, of maybe two other occasions in 17 years or so where we 

have—where we have essentially provided budget support to countries. One was with Georgia after the 2008 conflict and one was in 

Kosovo, right after Kosovo’s independence, where we provided debt 

32

relief. In general, our assistance is provided through technical assistance, advisors, grants to civil societies, support to private business, et cetera, so—and in this those cases, you know, we are not 

as exposed to that risk. 

Mr. KATZ. The only thing I would add, too, is that I think on the 

issue of corruption, at least what we have seen so far since March 

is a real effort to pass reform legislation, anticorruption legislation, 

a lot of it which was gathering dust previously. And I will just read 

you the past four really important pieces of legislation recently, 

and these are working—and this is Ukrainian civil society working 

with the government that passed a new public procurement law 

which was recently adopt. New amendments were adopted to the 

criminal law and framework law in preventing and countering corruption. Legislation was adopted on access to public information, 

legislation adopted on access to information of budgetary expenditures of government. 

Mr. KEATING. Can I interrupt just because our time is getting——

Mr. KATZ. Sure. 

Mr. KEATING [continuing]. Short. And I want to see if I can get 

one—at least the beginning of another question here. What recourse is there if they are not doing this and then not adhering to 

these guidelines, just quickly? What do we have as a mechanism 

or safeguard to enforce that they are? 

Mr. ROSENBLUM. So, well, one recourse we have is to withhold 

further aid, and you know, we—our support is assuming a commitment to reform. I think that the chairman made this point in his 

opening about, you know, the success of these programs only is ensured if governments have that commitment, have that in the policies in place. 

Mr. KEATING. We can maybe follow up on that. I just wanted to 

get one other topic in. 

Mr. ROSENBLUM. Sure. 

Mr. KEATING. I am running a little bit over in time but——

Mr. ROHRABACHER. I will give you one more. 

Mr. KEATING. Thank you, Mr. Chairman. And this is something 

we had a committee hearing on. 

Mr. ROHRABACHER. We will have second round if you want. 

Mr. KEATING. A committee hearing on this previously as well, 

and that is the issue that we take a lot of pride in our country and 

I think in terms of peacekeeping and have another example of 

where our country’s intervention clearly made a difference, whether 

it was political and religious turmoil in the past, and that is in 

Northern Ireland, and particularly given the rise in Euro skepticism and the continuing communal violence that has been spiking 

up there from time to time. I just wanted you to comment on not 

having the administration fund moneys, any moneys, zero summing international fund for Ireland. 

Mr. ROSENBLUM. Mr. Keating, the U.S. committed in 2012 to pro- vide $7.5 million to the IFI in support of a action plan that was 

agreed on by all the contributors to it, and the funding that we provided between 2011 and 2014, so this current fiscal year, we will 

have met that commitment. As we looked at the 2015 budget and 

given the significant budget constraints that we faced and the need 

33

to focus on the highest priorities, we didn’t request additional funding, as you noted, for IFI, but that does not bear at all on our 

strong commitment to provide diplomatic support for the efforts of 

our partners in Ireland, United Kingdom to move forward on the 

peace process to work with the Haass proposals that are on the 

table now. I think there was just a meeting yesterday where those 

were discussed with all the parties, and our assistant secretary actually in my bureau, Victoria Nuland, is on her way to Northern 

Ireland as we speak. I think she is there tomorrow to continue that 

engagement, so we are very committed to it. 

As things go forward, we are always open to reconsidering programming and things that we can do to help the process. At this 

point, though, again, you know, in our request, we didn’t include 

the funding for that for those reasons. 

Mr. KEATING. I hope in part because of our hearing that we had 

earlier this year that the House will be engaged and has been engaged, frankly, in trying to get some of those fundings because part 

of the response we had from that hearing was the necessity to take 

it that final step, and we are so close to the process. It had some 

obstacles that that was particularly noted that the U.S.—we have 

been such a strong supporter, had not come through with that, so 

that is my comment, and I yield back, Mr. Chairman. 

Mr. ROHRABACHER. Thank you very much. 

Mr. Lowenthal. 

Mr. LOWENTHAL. Thank you, Mr. Chairman. 

First, I would like to associate myself with many of the questions 

that Mr. Keating asked, especially wanting some of the specifics in 

terms of you mentioned rooting out corruption and eliminating corruption, especially in the Ukraine, which as I mentioned, I just recently visited, which even as up to the May 25th election, even 

though reforms had been put into place, everyone acknowledged 

that there still was rampant, rampant corruption going on. 

But as I also pointed out, I would like to know, you know, us to 

acknowledge or at least to talk about our funding. There is a real 

clear difference—not that it is not one country between Eastern 

and Western Ukraine, there were some really critical differences, 

and when we were there, we heard lots of talk about, well, there 

will be greater decentralization of power, that is part of the reforms, there will be more control over some of the budgetary 

things, there will be more responsiveness to many of the Russian—

Ukrainians of Russian heritage. Are these measurable objectives 

that we look at also? And how are we going to look at to see whether this occurs so that regardless of the outside Russian coming in, 

there were some really legitimate concerns that were going on in 

this country? And are we aware of that, and how are we going to 

at least condition some of our resources and foreign aid to their 

making changes to really bring—have a more unified government? 

And then the third question is where does our funding and what 

do you see in terms of energy independence for the Ukraine in the 

sense of U.S. funding, where are we, and are they going to need 

additional resources? 

Mr. ROSENBLUM. Okay. Thank you for three very excellent core 

questions for us, and I will look to Jonathan to help provide some 

of the answers. 

34

So, corruption, first of all. I can talk specifically about Ukraine, 

but what I say applies more broadly which is that it is—and I 

think I said in in my opening statement. It really is like a cancer 

that eats away at the very, you know, vital force of the society, and 

we—and addressing it and dealing with it is very complex, and we 

haven’t, to be honest, seen a lot of great success stories around the 

world and in our region. Where it has been more successful, you 

need a combination of high level commitment, and as we, you 

know, use the phrase ‘‘political will,’’ really willing to do some risks 

and do prosecutions and pursue cases against people, but you also 

need the demand coming from civil society that is organized and 

it is pushing. That has to be there, too. 

I think right at the moment, in Ukraine, you do have both of 

those elements. You know, the proof is in the pudding as they say, 

and we still need to wait to see, you know, Jonathan referred to 

these new laws being adopted. They have to be implemented, and 

that is one of the areas where our assistance can help by having—

we talked with the government about having advisors that would 

actually be in ministries and help with the implementation. Other 

donors are committed to that as well. So, it is a long-term and complicated task, but it is essential and especially in Ukraine. 

On the second question was about the unity of the country, the 

east/west divide, and so on. We think it is absolutely essential that 

that be agenda item number one. I guess maybe it is obvious it has 

to be, given the violence and separatist activities in Eastern 

Ukraine. President Poroshenko has made a very strong commitment, which he is now following through on, to open negotiations. 

There is a ceasefire that has been in effect for—a unilateral 

ceasefire, I should add—for the past 5 days, and negotiations have 

begun, discussions have begun. That is going to have to be in the 

context of a broader move toward reforming the constitution, which 

again, he is also very strongly committed to, to provide for more 

decentralization, more authority, as you were alluding to, to local 

government. 

But the one other element that you didn’t mention, which I think 

is also critical, is the economic growth in the east especially. That 

region, as you know, it is sort of the rust belt of Ukraine and has 

lagged behind much of the rest of the country in growth and has 

a lot of industrial enterprises that are not particularly efficient 

anymore, and grappling with that has been a challenge for every 

Ukrainian Government. It is going to remain one here. We and 

other donors are right now thinking about and planning activities 

that can help jump start growth in the east in terms of especially 

small business growth, more credit access for small businesses, providing support basically to grow the economy in the east, and that 

will, over time, also affect the split, the divide in the country. 

And then the third, the third issue was——

Mr. KATZ. Energy. 

Mr. ROSENBLUM. The energy, right. Energy, like corruption at 

large, very complex, lots of elements to it. Just in terms of what 

we are specifically doing on energy in Ukraine, together with the 

EBRD, the European Bank for Reconstruction and Development, 

and the EU, we are developing a plan to help restructure the gas 

supply system, and the company that is in charge of that, 

35

Naftogaz, this is something that, again, the government has asked 

us for help with. That company and that system is a source of a 

lot of, you know, the inefficiencies, the losses, and the corruption 

that plagues the energy system in Ukraine. 

We also have been helpful more in a diplomatic way, not so much 

through assistance, on the issue of reverse flows of gas so that 

more gas can be coming from Europe back into Ukraine from especially Slovakia. The EU sort of has the lead on that, but that is 

another critical issue. 

And then the other area, which is something Jonathan’s—that 

USAID is deeply involved in is energy efficiency. 

Mr. ROHRABACHER. Which is not heard of at this moment in 

Ukraine. 

Mr. ROSENBLUM. Yes, it is nascent. 

Mr. ROHRABACHER. It is already——

Mr. KATZ. Inefficient, one of the worst in the—globally. 

Mr. ROSENBLUM. Yeah. So we have got a program already that 

USAID has been doing for years in Ukraine. We are going to expand that and get more financing for local infrastructure improvements that will make the efficiency work. So that is—I don’t know 

if, Jonathan, you wanted to add. 

Mr. KATZ. Yeah. No. I sort of associate on all of your remarks 

as well. I think what you—what Dan was saying about this being 

the right moment, a moment I think the—Congressman Keating 

mentioned that as well, that Maidan had such an impact both on 

the current government but also in the population of Ukraine, that 

this is really the right opportunity, and you see it through the legislation that they are passing, you see it through the effort, you 

mentioned the constitutional effort right now, I think, even today. 

President Poroshenko laid out his decentralization amendments to 

the constitution. This is what was reported today. I haven’t seen 

what that entails, but we see as—there is a sense of seriousness 

within the government to move forward. 

And I wanted to just say, too, just in terms of general of 

anticorruption measures, all of our programs, USAID’s programs in 

the region have a anticorruption measures embedded in our programs, and so I think this is particularly important. We recognize 

that this—because of endemic corruption in the regions, that we 

need to have it as part of our programs. 

Mr. LOWENTHAL. Mr. Chair, if I just may follow up on that. Just 

to add to one——

Mr. ROHRABACHER. Go right ahead. 

Mr. LOWENTHAL. If you will, again, the next time we have this 

hearing next year on this, if we could see some of the results of 

these measures because, you know, we make decisions without 

knowing any measurable results, and I would like to hear some of 

these measures that have been put into place 

Mr. KATZ. Yeah. 

Mr. LOWENTHAL. Thank you, and I yield back. 

Mr. ROHRABACHER. Would you like to—you have something to 

add? 

Ms. ROLLINS. My bailiwick happens to be Central Asia, so I really don’t have anything to comment on Ukraine. 

Mr. ROHRABACHER. Thank you very much. 

36

The chair now will take his allotted time. There was mention in 

the beginning of the testimony that there was a $1-billion loan 

guarantee for Ukraine. Seeing that we have discussed Ukraine, I 

guess I might as well ask some of the details about that. What 

bank provided the loan that we have guaranteed to Ukraine? 

Mr. ROSENBLUM. The loan wasn’t provided by a bank. It was a 

bond issuance that the Ukrainian Government did, and so the 

bonds were purchased by people from institutions, individual investors. 

Mr. ROHRABACHER. Was there any major investor that bought 

those bonds like, Western European investors maybe? 

Mr. ROSENBLUM. I will have to get back to you on that, Mr. 

Chairman. I don’t have the details on who purchased. 

Mr. ROHRABACHER. I would like to get a rundown as to who 

bought the bonds that we are not guaranteeing because the fact is, 

whoever makes the loan is the real recipient of our largesse. 

Ukraine is not the recipient. Whoever loaned the money to Ukraine 

is making a guaranteed profit via the United States taxpayers. 

That is true of all of these guaranteed loans that we talk about 

here, and we have to realize that it is a big issue coming up on 

the Export-Import Bank. And who is the real recipient of all of 

this—all of these billions of dollars that the Export-Import Bank 

guarantees. It is not the companies that they are talking about. It 

is the banks who are in the middle who make that money because 

they have now a guaranteed profit. And I don’t understand how we 

can—I don’t have a way right now how we can get away from that 

system, but it seems that we are paying—that there is a lot of middlemen making a lot of money off benevolent programs like this. 

So it is possible that those bonds that you are talking about were 

actually purchased by some financial institutions in Western Europe; isn’t that true? 

Mr. ROSENBLUM. It may—it is possible. It is possible. And we 

will——

Mr. ROHRABACHER. It is possible. 

Mr. ROSENBLUM. We can get back to you with a more detailed 

answer to your question. 

Mr. ROHRABACHER. Now, how were you getting involved with the 

Ukrainian problem in the first place? They had their first real free 

election, I remember, about 10 years ago, and in came with the Orange Revolution—and I visited there during the Orange Revolution 

in support of the Orange Revolution, and they had a corrupt government, and they then brought in a government, and there was 

an election, and they were elected, and that government turned out 

to be corrupt even though they were pro-Western, and that is why 

you in a very free election that was verified by the OSCE that you 

had Mr. Yanukovych, who was elected, right, democratically elected 

President, who was overthrown by the people who we now are 

pouring our resources into, and he was overthrown before the election process, not as a result of the election process. 

I don’t think that is a good precedent for us to set. I don’t think 

that when an elected government is overthrown, that we necessarily have to come in. We should do some really soul searching 

because I believe there were powerful forces at play, maybe even 

European financial interests that didn’t want Ukraine to be associVerDate 0ct 09 2002 14:13 Jul 31, 2014 Jkt 000000 PO 00000 Frm 00040 Fmt 6633 Sfmt 6633 F:\WORK\_EEET\062514\88459 SHIRL
37

ated with a Russian common market as compared with a Western 

European common market that may have been at play here. I don’t 

know. It just seems that that may well be the root of this problem, 

and here we end up pumping a billion dollars’ worth of guarantee 

into some financial supporters who may be those same Western 

Europeans. It is a very murky situation, and it is not, as some of 

my colleagues believe to be, as simple and as easily definable as, 

who is the good guys and who is the bad guys, as you might assume. 

Let’s get back to your request; $625 billion—does the billion-dol- lar that we have a loan guarantee, that doesn’t come off the $625 

million request. So for all of your jurisdiction, you are asking for 

$625 million, the administration is, and yet we have just provided 

one country, Ukraine, with a $1-billion loan guarantee. Okay. I 

guess that is resulting because there is a crisis going on and we 

need to—because there is a crisis, we need to get involved in it. I 

would suggest that we don’t need to get involved in all of these crises. I would suggest that perhaps it would be better for us not to 

be doing that, and unless it is an emergency, as I mentioned in my 

opening statement, that we should focus on if there is an emergency humanitarian situation, that is far different than having us 

come into other societies like Ukraine and trying to restructure the 

way they have their government and their society functions, which 

it seems like we are trying to do. And our ridding—ridding Ukraine 

and some of these other countries like Ukraine of corruption would 

be the equivalent, I guess, of ridding Ireland of beer, and it is 

part—beer is their culture up there, and you don’t try to tell people 

in Ireland not to drink beer. 

Well, corruption is a way of life with some of the people that we 

know, and for us to placate all of our policies on changing the basic 

way of life does not make sense to me because I don’t think it is 

going to happen. I think we tried that in Iraq, and it didn’t work. 

We can try—we can try to make—we can try to say to other people that they shouldn’t have religious faith, but it may be really 

part of their culture that they have a religious faith, and maybe 

even they include it in their government, and our theory of government is that the church and state should be totally separate. I 

think it would be wrong to go into another country and say to them 

I am sorry that we are going to try to put pressure on you to make 

sure that church and state are never allowed to be together. And 

I would hope that our limited funds that we have are not—I mean, 

not you—all the goals that you have outlined today are lofty goals. 

I mean, certainly ridding their country of corruption is a lofty goal. 

It just seems to me that—I am not confident that we are going to 

achieve that goal, and I am also confident that when we try to get 

too deeply involved, there are international forces that are at play 

that can manipulate our largesse and our benevolence. 

With that said, I will certainly go through another round, so Mr. 

Keating can chastise me for using the expression of beer in Ireland. 

Mr. KEATING. Well, thank you, Mr. Chairman. 

I must tell you that the issues that we are dealing with are ones 

of violence. In Ireland, for instance, it was a climate of a terrible 

violence, civil rights issues that would have continued much further if it wasn’t for the U.S. intervention. It is a sterling example 

38

of how our country—and that is not just an American speaking. 

That is what I hear universally from both the north and the south 

of Ireland. If it wasn’t for U.S. intervention into that era of terrible 

violence, the peace that is there, the success we made wouldn’t be 

there, and certainly I believe we can take it to the finish line, given 

Mr. Haass’ testimony to this committee and the progress we have 

made, I think we are so close 

And the issue in Ukraine, from my way of thinking, is not what 

Western Europe wants. It is not what the United States wants. It 

is not what Russia wants. I think our administration’s position is 

to allow Ukraine to have what it wants and the people and its administration, and that is the kind of assistance we are giving to 

them now. We tried it in Poland. We tried it in Estonia. We tried 

it in Latvia. We tried it in the Czech Republic, and you know—we 

tried it in Ireland, and you know, that kind of assistance did work 

in those instances. And we have had the success that our panelists 

have spoken about in terms of the progress of those countries. 

So I think given that is the way I view it, and I think it shared 

with many of the people that have testified, I think it is important, 

though, that there are metrics, as Mr. Lowenthal has said. It is important there is accountability, not because it is the U.S. making 

the decisions about Ukraine, but because it is U.S. guarantees involved. The decisions with Ukraine, if we are going to be successful, and we will fail to be successful if we don’t, must come from 

Ukrainians themselves, and that is why this election, this past 

election was so important, and I think it was the fundamental step 

that we had to take going forward, so I see some progress. 

I did want to, in a second round, just touch base on another area, 

Turkey, which is a strategically important partner for the U.S., and 

I am concerned about the government’s treatment of political opponents, independent journalists, and members of the political opposition. What are State and USAID doing to support civil society and 

independent media in Turkey? The strength of our strategic partnership in Turkey should be based on shared respect for democratic 

values and institution, not just regional interests, so I just wanted 

to touch for a second on that if we could. 

Mr. ROSENBLUM. I will let Jonathan begin. 

Mr. KATZ. Yeah. Thank you for that question. You know, USAID 

is not present in Turkey. We don’t have a mission there, and so I 

don’t want to speak out of turn. However, you know, as we, the 

United States, know from our own experience, strengthening due 

process, fighting corruption, encouraging civic participation, including the media, and political decision making not only make countries freer but also help them grow more quickly. 

And while the United States is not, and I want to repeat, will 

not become involved in Turkey’s internal politics, we will continue 

to express, as we do around the world, our strong support for transparent and accountable government.

Mr. ROHRABACHER. So we have no money going into Turkey? 

There is no aid programs there. 

Mr. ROSENBLUM. We don’t have any aid programs there now——

Mr. KATZ. That is correct. 

Mr. ROSENBLUM [continuing]. Related to civil society. The money 

that is going to Turkey, the small amounts are for—we have an 

39

IMET program, the military, education and training, and we also 

have a small amount for a counterterrorism program related to terrorist financing, so that is—that is——

Mr. KEATING. How has that counterterrorism funding been received by Turkey? Not physically received. How have they reacted 

to that? There is an increase in that. 

Mr. ROSENBLUM. Well, actually, it is a little misleading, and I 

have to explain the way our budget was presented this year. It 

looks like a big increase. Apparently, and as we learned as we were 

preparing for this hearing, the same program that we are going to 

be continuing in Fiscal Year 2015 is ongoing, and it was funded 

previously from a global counterterrorism fund, and for the 2015 

budget, it was decided to put it into the bilateral line for Turkey 

in the interest of the transparency, essentially, to show exactly 

where the money is, and it is essentially, it is supporting a resident 

legal advisor who works on counterterrorism financing activities 

and facilitates interagency capacity building related to that financing. And I think we—you know, our understanding is that we are 

working closely with Turkish counterparts in the government, and 

they are supporting their reforms. These are reforms that they 

want to make. 

Mr. KEATING. Working closely, but do they accept the premise 

that there is a counterterrorism threat there? 

Mr. ROSENBLUM. Well, they accept the value of our assistance, so 

I can’t speak to the broader question, but they must—I think it has 

to do with their qualification for the FATF, or the Financial Action 

Task Force, this international body, and meeting those standards, 

which they want to be part of. 

Mr. ROHRABACHER. They may have too much to be thinking 

about when they are dealing because they spend so much time 

helping the groups that are trying to take over Syria now, those 

benevolent groups that are trying to take over Syria. 

Mr. Lowenthal. 

Mr. LOWENTHAL. I am really enjoying this hearing. But I don’t 

think the analogy of beer drinking in Ireland and corruption in the 

Ukraine is quite accurate. I think—I think that most people in Ireland enjoy their beer and most people that you speak to in Ukraine 

abhor the corruption, abhor it. But it may be difficult, and I do 

agree with the chair, to have it imposed and those changes from 

the outside does not seem to be a successful way of dealing with 

it. 

I would like to turn to Central Asia. You are on the panel. We 

have not forgotten about you. And talk a little bit about human 

trafficking in Central Asia and what kind of challenge that is and 

what is really—what can we, and you know, and realistically do 

and what we can’t. I think—I think one country, I am not sure it 

is in Central Asia, but it is now a Tier 3 country, according to the 

recently released Trafficking in Persons Report, and how is our assistance tied in any way to the reduction in human trafficking? 

Ms. ROLLINS. Thank you very much for that question. 

So we are also very concerned about the human trafficking situation in Central Asia, and it is pervasive. We do have a program 

that we work through IOM to help set up centers for women and 

men. We also have a center in Tajikistan that is specifically for 

40

men who are brought back across the borders. But we work on prevention, so we have media campaigns to help deter families from 

sending their men or women out. 

We have centers when they come back so that they are provided 

psychosocial support and health facilities, et cetera, testing and 

treatment for infectious diseases, and set up kind of small and medium type enterprise livelihood activities so that they can go back 

into their communities. 

So it is a very serious concern in that part of world. I will let 

my colleague Dan talk about the tier ranking. It is Uzbekistan that 

is now on Tier 3. The others, though, have made some progress 

throughout the years. 

Mr. ROSENBLUM. It is a serious challenge in the region. All five 

countries have, to varying degrees, have shown commitment to 

tackling it and have welcomed our assistance in the areas that 

Denise mentioned. We actually, in addition to having centers for 

victims of trafficking and doing prevention work on, you know, sort 

of public announcement, service announcement type work, there 

has also been an element on the prosecution side, where we are actually helping countries in Central Asia develop the capacity to 

prosecute those cases under their laws. 

Uzbekistan is Tier 3 in a recently released trafficking report. 

They are now Tier 3 for the second year. In the case of Uzbekistan, 

it really has to do with labor, and you know, compelled labor for 

the cotton harvest. That is really the key issue. There is still—that 

is still occurring. And now the positive development is that the 

Government of Uzbekistan is allowing the ILO to come in and send 

observers, and they have also signed on to a new ILO—to an ILO 

program that is called the—what is it called, the Decent Work 

Country Programme, so we think—we view these as positive steps. 

It wasn’t enough to get them to the higher tier this year, but they 

are moving in the right direction, we think. 

Also, just programmatically, overall in Central Asia, it is about 

$3 million that is going toward this whole group of programs that 

we have been talking about. So, again, you know, problems remain, 

some progress, and we could—you know, if we had more time, we 

could go into more detail on that progress, but it is—you know, it 

is one area where we actually have good engagement between civil 

society and the governments of the region. There seems to be, you 

know, the governments have actually not have welcomed the involvement of NGOs and mostly through this IOM, International 

Organization for Migration. 

Mr. LOWENTHAL. Thank you. 

I yield back. 

Mr. ROHRABACHER. I want to thank our witnesses. I always appreciate a good discussion, and I also, as is noted, I don’t gavel people down until all the points have been made, and I certainly appreciate you folks doing your part in this and keeping us informed. 

I would like to have a list of those people who purchased the 

Ukrainian bonds. Obviously, there is a disagreement on the issue 

of Ukraine. I voted against that billion-dollar program, and my colleagues, of course, supported it and people can honestly disagree, 

and I respect them for their position. 

Mr. LOWENTHAL. We respect you, too 

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Mr. ROHRABACHER. And we are very pleased that you are here 

to give us the information we need to know, and we are making 

those type of decisions, and then they go out and do a good job in 

implementing them, so thank you for the good work that you are 

doing, for your service to your country, and we are all trying to 

make this a better world, and with that said, this hearing is adjourned. 

[Whereupon, at 3:15 p.m., the subcommittee was adjourned.] 

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