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 You are in: Bureaus/Offices Reporting Directly to the Secretary > Deputy Secretary of State > Bureau of Resource Management > Releases on Resource Management > Remarks on Resource Management - Budget, Planning, Performance > 2001 Remarks on Resource Management - Budget, Planning, Performance

Briefing on FY 2002 International Affairs Budget

Phillip T. Reeker, Acting Spokesman
Joseph W. Bowab, Acting Director of Resources, Plans and Policy; James L. Millette, Deputy Assistant Secretary of the Office of Budget and Planning; John Riddle, Deputy Coordinator for Assistance for Eastern Europe; James Mack, Deputy Assistant Secretary, Bureau of International Narcotics and Law Enforcement Affairs; Pam Callen, Deputy Director, Office of Budget, USAID; William Taylor, Coordinator, Assistance to the New Independent States
On-the-Record Briefing on the President's FY 2002 International Affairs Budget
Washington, DC
April 9, 2001

MR. REEKER: Let's go ahead and get started. Welcome back this afternoon to the State Department. As promised, this afternoon we have a briefing on the international affairs budget. You should all have received a copy of Secretary Powell's statement which we released shortly after Ambassador Boucher's noon briefing today regarding the budget for international affairs for Fiscal Year 2002. If you don't have a copy of that, the Press Office can bring some additional ones in.

And now we are very pleased to have with us two distinguished State Department officials who will be able to talk a little more about the budget. Joseph Bowab is Acting Director of the Office of Resources, Plans and Policy, and James Millette is the Deputy Assistant Secretary of the Office of Budget and Planning. I think both gentlemen have short remarks, and then we will cut straight to your questions.

So let me turn it over to them.

MR. BOWAB: Good afternoon. Each of you should have received two books when you came in today. One of them is called the Summary and Highlights document for Function 150. That includes all programs under Function 150. The second larger book that you have is the Budget in Brief which contains all of the State programs. So the Budget in Brief is a larger version of what you'll find in the Budget Function 150 book. The 150 book has all $23.9 billion worth of programs in it, including the State part, and then the second book that you have is just a more detailed version of State programs.

Hopefully you've all had a chance to look at the book. We don't really have any opening statements outside of what the Secretary's statement was provided to you, so we would be available to take your questions now.

Q: Does that mean that the gist of the smaller book is kind of like the budget really in brief, and that this is not really the -- I don't get it.

MR. BOWAB: The International Affairs 150 book is really the executive summary of all programs.

Q: Including the State?

MR. BOWAB: Including the State. So the State book is just a more detailed version of what you would find in the 150 book.

Q: Since we've only just got it this second, we haven't had a chance to look at it, but I do see that there is a decrease on overseas assistance to migration and refugees. Can you tell us why?

MR. BOWAB: There is actually an overall increase for migration and refugees.

Q: So I'm looking at the wrong page, then?

MR. BOWAB: There is actually a $17 million increase for migration and refugee assistance.

Maybe, to help you along, if you would pick up the 150 book, the smaller book. And to give you an idea, if you'd go to page three in that book, it has all the accounts listed. And then towards the back of that book are the account breakouts bilaterally by countries, all the way in the back of the book.

Q: Isn't page three what we have been given before?


Q: Okay. So --

MR. BOWAB: Everything after page three you had not been given a copy of that. This is the same breakout in the account structure and in the books as we do every year. This is no different than any previous year.

Q: But there are no new overall numbers in this from what page three is, right?


Q: There is just -- there hasn't been any change in that?

MR. BOWAB: No. If there has been any change, it has been minimal. And then the only thing that you didn't have last time was the detailed breakout bilaterally for each one of the accounts, and the justifications for each one of the major accounts.

Q: I know that last year you also Ė we were also given this bar chart that showed us what the actual decrease in spending had been to foreign assistance in the United States. Can you give us an idea of how you think this would pan out in terms of comparisons with inflation and so on?

MR. BOWAB: Sure. Let me try to put it in the perspective of, each administration provides different types of charts, as far as to talk about international affairs. If you look over the last 25 years, in constant dollars, international affairs funding is just slightly above $25 billion, over the last 25 years, in constant dollars. So this budget, at close to $24 billion, is slightly below the constant dollar figure over the last 25 years.

I know in the past you have seen charts that have decreases since 1985 in it, but 1985 was kind of a high-water year for international affairs funding. But over the last 25 years, it has been about a little over $25 billion.

So quick math would lead one to believe this is about four percent below in constant dollars worth spent over the last 25 years.

Q: What does it compare to 1985 (inaudible) compared to that, in percentage terms?

MR. BOWAB: 1985 and last year?

Q: Yes.

MR. BOWAB: From last year, it's an increase of 5.3 percent. From 1985, in real dollars, it's a decrease probably about 34 percent from '85. But you've got to remember, 1985 was an anomaly. It was not a normal year for international affairs. There was a lot of other funding provided in 1985 in the form of supplementals for the Mid-East, rather large supplementals for the Mid-East, and there were some changes in the way that we were doing loans at the time with foreign governments that tends to make the number look higher.

Q: How much did that increase in (inaudible) ? In the State-Justice-Commerce item?

MR. BOWAB: The total? 13.2 percent is for State, CJS, and two percent is for foreign assistance programs.

Q: 13.2 is just for the State Department out of all three Departments?

MR. BOWAB: If you go down to page three, the difference between the 6.9 and the 7.8 for Commerce-Justice-State is approximately 13.2 percent.

MR. MILLETTE: I think you're talking about the three agencies. There's no Commerce or Justice in those numbers. That's just the State Department.

Q: That's just the State, okay.

MR. MILLETTE: That's just the State Department.

Q: Of the 5.3 percent over last year, how much of that is dedicated to one-time capital improvements in the State Department? Like getting it up to speed on computers and Internet and so on?

MR. BOWAB: What we have essentially is significant increases in information technology, which is we're seeking $210 million in our capital investment fund, which is going towards information technology. We are also seeking significant resources, $665 million, towards building new embassies for security purposes, and the number overall in the budget that you would see for security enhancements is $1.3 billion, which includes what I just mentioned for building embassies. There's also perimeter security programs in there as well, and some enhancements in hiring some more security professionals.

Q: So that would actually account for more than 5.3 percent, right?

MR. BOWAB: Well, you've got to look at the bases. For Commerce-Justice-State, your whole base is only $7 billion. On the foreign assistance side, you're up in the $15 -- what's it, 15? -- $15 billion. So that's the -- well, you've got to be careful when you look at percentages.

Q: Why has economic assistance for almost all of the Balkans dropped what appears to be fairly precipitously?

MR. BOWAB: Under what account? Under the Seed Account?

Q: Yes. It's just under "Economic Support Fund", and it says, "Assistance for Eastern Europe and Baltic States." I mean, I just got this, like everybody else, and the Federal Republic of Yugoslavia is getting what looks to be a significant cut, as well as Kosovo, and Bosnia-Herzegovina.

MR. BOWAB: John, do you want to address that?

MR. RIDDLE: I'm John Riddle, Deputy Coordinator for Assistance for Eastern Europe. Basically, the 610 figure is exactly what we asked for last year. The difference is a couple of supplementals that we got in the interim. The FRY figure, of course, we didn't -- we werenít dealing with the FRY last year at this time.

Q: Right.

MR. RIDDLE: We have since got a supplemental in a 2001 budget, which picked it up considerably, along with Montenegro. We are now planning in 2002 to be dealing with the FRY as a country, because that's what it is currently, and we expect to be figuring out the exact levels for the various parts, dependent upon how Serbia, for instance, complies with its international obligations, continues to comply. The Secretary last week certified that they were in compliance, and we hope that that will continue in the future. We are looking forward in the summer to a donor conference, and of course this is funding for next year.

So it will depend how things go.

Q: Well, I mean, just to follow up, you know, the -- I mean, some of the early estimates are in, and at least the Government of Belgrade says they are going to need a significant amount of more assistance now that they look to try to develop I guess their interim economic recovery plan.

Does this figure in any way represent the US trying to sort of disengage from that, and leaving more of the burden with the EU or other groups?

MR. RIDDLE: No, I don't think so, but basically the money we have for the upcoming conference has already been appropriated.

Q: The money for the upcoming conference?

MR. RIDDLE: The upcoming conference, the gap that they will be filling. As my understanding is, we already have it now, and of course this will be another part of that.

Q: The Donors Conference?

MR. RIDDLE: The Donors Conference in the summer. Of course, this money, the 2002 money, will not be available until October.

Q: So wait a second --

MR. RIDDLE: So the Donors Conference that they are talking about with the $600 million gap -- actually, that's the Government's estimate, as I understand it -- will take place before this money is appropriated. So we are not going to be pledging this money at that conference. We will have to use the money we have currently been appropriated.

Q: So there is more money that you would place from somewhere else?

MR. RIDDLE: The money that has already been appropriated.

Q: If you decide to go along with it and --

MR. RIDDLE: Right.

Q: Right. Okay.

Q: Could you say how much the money was for the Donors Conference that is being set aside?

MR. RIDDLE: I don't know. Actually, the World Bank is putting together some papers for that, and we'll take a look at those when they're done.

Q: But that money hasn't been budgeted at all yet? Like a future potential contribution, and the Donors Conference has not --

MR. RIDDLE: The initial money that we will be pledging at the Donors Conference has already been appropriated, and we will decide at the conference exactly what we are going to pledge at the conference. Next will come additional money for the following year. These things are all rolling along.

Q: I just wanted to make sure. The chart on the small book, on page three, I guess is compared to the chart in the bigger book, on page six. That's like a fuller explanation?

MR. MILLETTE: What Joe was trying to say is the little book talks about the full Function 150. The little book is what you would normally know as the Commerce-Justice -- the State Department piece of the Commerce-Justice-State bill. So they both reflect each other, it's just there is detail for every appropriation for C-J-S in the larger book. It goes into much greater detail by appropriation, whether there are programmatic increases in those appropriations, et cetera.

Q: And then when you were talking about the 210 million for technology tools --

MR. MILLETTE: Right, that's --

Q: (Inaudible) and embassy enhancements, would that be under the diplomatic and consular programs?

MR. MILLETTE: Yes. What you would see is actually in the line item called Capital Investment Fund, that's the 210 for information technology.

Q: Oh, okay.

MR. MILLETTE: Okay? The next line down, Embassy Security Construction and Maintenance, is a total of 1.2 billion, 1.29 billion. That's broken up of a couple pieces -- ongoing operations. Then there is the 665 for security construction and then the perimeter security component. So it's those three chunks.

Now, up in diplomatic and consular, which is our main operating account where we pay for the salaries and expenses and most of our employees, you'll see part of that is broken out as a worldwide security upgrade for 487 million. So those are the various security components. So if you were to take that 487 to 665 and 150, there is the 1.3 billion.

Q: Of the $1.2 billion increase, it looks like, if my math is right, that 73 percent of it is for the administration of foreign affairs. Is that where the bulk of the increase usually is?

MR. MILLETTE: Historically, no. This is the Secretary saying where his priorities are to bring the State Department up to date and to meet some of our operating requirements.

Q: In the preface you say that in past years the State Department observed the budget as not being what it should be and that it's changing now with a new Secretary on board. That's quite a claim. Can you tell us how it's changed under the new Secretary already? I mean, my understanding is this increase is not so radically different from previous years. So how is it changing?

MR. MILLETTE: I think what the Secretary said is that when you look at the total number, the 5 percent for the overall function. I mean, that's -- you can make of that what you want. What he is saying is that on the operating side, when you talk about the State Department operating increases at 14 percent for our main operating account it's 17 percent. That's where the change -- he has put the focus on the operations and the people, not stating that the other things aren't as important. It's just that coming in with the little bit of time he had to operate, he identified severe weaknesses in our operations and the low morale among the employees and is putting the major focus there.

Q: Can I just follow up? Can you tell us how specifically this budget is going to help improve morale?

MR. MILLETTE: Sure. It's going to help morale by doing a couple of things. One is hiring people. We'll be hiring 360 people on the general side to help with the lack of people that we -- because we don't have enough floating people to train and shortages. We're hiring 186 security professionals. It's providing -- really, when you look at the information technology, what we've said is 210. To that we add something we collect called an expedited passport fee so it gives us $273 million to enhance our information technology, which is going to be focused towards two main areas, the first being getting Internet access for every individual at their desktop. Currently we have that in only in an email capacity, but not the full browsing. This will allow for full browsing. That will probably take us a little over a year to get there.

The second major initiative in information technology is to get classified connectivity with all posts around the world. Clearly about 80 percent of our posts today don't have up-to-date access in the classified communications, and we expect to finish that program over a two-year period.

Again, what we already talked about was the 1.3 billion for security to make people feel safer. And then we're also making a major investment in the overseas infrastructure so that a lot of the embassies that are in need -- ongoing maintenance that they haven't gotten to the degree they should in the past and other issues -- we're investing money in that area as well.

Q: To follow up on that, with all these increases in spending, besides the Export-Import Bank and OPIC, could you tell us what kinds of programs you've had to cut to be able to pay for these dramatic increases?

MR. MILLETTE: I don't think we've cut any programs on the operating side. Everything other than -- out of these areas --

Q: How did you find the money for it, I guess? I mean, there was a 5 percent increase but, I mean, were there any other kinds of -- I mean, the budget -- you have to eventually sort of balance it out. So where did you find the money from?

MR. BOWAB: Number one, when we started out to build the budget, we didn't pick the number and then try to fit everything within the number. So when we built the budget, we built the budget based on requirements. The Ex-Im, OPIC, and debt restructuring that you see with lower numbers are programmatic numbers. They are not cuts to make cuts. In other words, what we're saying is we can do with OPIC and Ex-Im what we did this year with a couple changes in policy.

On the debt side, on the debt restructuring side, the debt restructuring had a $210 million supplemental in there for the HIPC trust fund that is not required in '02. So I think if you look through all of the funding, I think you are going to see that no programs took any cuts, that we are basically funding all programs at what we need to fund them at in '02. So I think it's a misstatement to say we cut programs to fund other programs. We did not cut programs to fund other programs, nor did we start out with a specific number that we had to get to.

Once the Secretary looked at all the priorities and chose what he wanted to go after, we built the programs to that and we ended up with a number, and that's the number we went after in the budget submission.

Q: I'm going to ask you a couple of specific things, starting on page 49. I'm just wondering why there is no funding at all for the OAU, why the Presidential Economic Growth Opportunity is gone to nothing, although I do note the regional organization gets quite a big boost, but the SADC initiative which -- South African.

MR. BOWAB: SADC. Yes, South African.

Q: Just if you could explain those four, those four lines. Also, under -- I assume this Chinese compensation is for the embassy?

MR. BOWAB: That was for the embassy, yes.

Q: Maybe a little premature considering --

MR. BOWAB: You don't want to pay them again, do you?

Q: Maybe you ought to set aside something else in there. (Laughter.)

And the last one on Indonesia. International military education and training, it's a bump of 200. And I'm just -- does that imply that this Administration is going to drop the restrictions on --

MR. BOWAB: No, that does not imply that we're going to drop any restrictions. That implies that hopefully in six, eight months down the line things have changed. If things have not changed, then of course that number would be different.

On the OAU, under -- I guess you're referring to the ES, the Economic Support fund?

Q: Yes.

MR. BOWAB: On the OAU, the OAU is taken care of in the peacekeeping account in '02. You will see -- I believe we had the language in there under the peacekeeping account for '02. You're not going to find it specifically in the chart. You're going to have to go back to the words in the book.

The Presidential Growth and Opportunity and the SADC initiative are both programs that have come to an end. They're finished. But if you look at the peacekeeping write-up, there should be something in there that talks about the OAU under the Africa regional account.

Q: Ecuador has a huge increase in the Manta (inaudible) related to the Manta Air Base. And also while we're in the region, can you explain a little bit the Andean counter-drug initiative and the 400 million for Colombia -- well, the huge increases compared to '01 for each country? And are any of this covered by what has already been appropriated under the Plan Colombia?

MR. BOWAB: Okay, Jim -- is Jim back there? Jim, do you want to talk or do you want me to talk? Do you want to talk about it? The OAU is on page 30 at the bottom of the page.

MR. MACK [James Mack, Deputy Assistant Secretary, Bureau of International Narcotics and Law Enforcement Affairs]: Would you repeat that question, please? I could not hear it over there.

Q: Oh, you got much more for ESF for Ecuador. Is that related to the Manta base?

MR. MACK: No, it is not.

Q: Is not. Okay. And on -- what is it related to, then, aside from the fact that they're in economic trouble?

And for the general Andean counter-drug initiative, there are big increases obviously over '01. To what extent do appropriations from Plan Colombia cover these, if at all? And can you just give the justification for the large increases in this area?

MR. MACK: The ESF -- I really can't speak to the -- I'm sorry, I cannot speak to the ESF for Ecuador. My assumption is that based on my experience is that this relates to the situation on the northern border of Ecuador, which is right next to, of course, the southern Putumayo area of Colombia where there has been an increase in activity. The Ecuadorians are very desirous of being able to deal with that, plus some serious economic situations that are facing them at the present time.

Now, you asked a question about the relationship between Plan Colombia and the Andean counter-drug initiative?

Q: For '02.

MR. MACK: The 2002 budget is a continuation and an expansion enhancement of that. You will notice that the numbers are beginning to move towards 50/50 related to the developmental side, as opposed to the interdiction side. So this is a process that began with the 2000 supplemental where over 80 percent went to Colombia, and as we move into this phase and 2002, you're seeing a greater gravitation towards assistance to the countries that are impacted, potentially impacted, by spillover.

Q: And if I could -- just one other one. On the global environment initiative -- sorry, global environment facility, you're asking the same amount as last year. Now, they have a global warming component. Does this mean that the State Department is committed to doing things about global warming that perhaps the rest of the Administration is not?

MR. BOWAB: Everything that is funded under the multilateral development banks were based on our meeting the schedules that we had agreed to. So this does no more or no less. It just meets the schedules that we have with the banks.

On Ecuador, as far as the economic support funds, the increase, let me say this. As you know, Ecuador has been through some terrible economic crises, especially since 1999. Much of the increase is going to be for huge structural reform that we're going to try to perform in Ecuador. Even though the economy has stabilized, they need huge structural reform in Ecuador. And it's also part, as Ambassador Mack pointed out, it's also part of kind of the spillover effect that we're getting out of Colombia right now and some of the countries in the Andean ridge.

Q: (Inaudible) HIV, some Senate Democrats are already reporting that they think the budget does not include nearly enough money for international HIV programs. And they're saying it's only $3 million, and I'm still looking. I'm just curious if that's at all accurate.

MR. BOWAB: If you look under the USAID portion of the 150 book, for '02 it's going from 299 in '01 to 329, 329 million in '02.

Q: Okay. Another thing -- the other one was a follow-up to Colombia. And one of the statements I found on the web earlier today says that there is -- one of the goals under the Andean initiative is for total eradication of all coca crops in Bolivia by the end of 2002. And I just have a question about the feasibility of that.

MR. MACK: The Bolivian Government has set as a goal the eradication of all illicit coca in Bolivia by the end of 2002. They are largely there already. Now, as you know, in Bolivia there is a substantial amount of coca that is used, traditionally used, chewed, and that is not covered by this. So that would be the illicit coca. That accounts for the difference in the two figures. But that is their stated goal.

Q: If I've understood this correctly, one of the major ceilings has been on Ex-Im Bank and OPIC and TDA. And from what I can see, this is justified by lower estimates of international lending risk. Can you tell us where those estimates have come from and if it reflects some kind of global trend, or whether it's just that we -- you guys are -- you think you can best invest your money on the (inaudible)?

MR. BOWAB: No. As you know, Ex-Im makes loans based on the way the government does sovereign risk ratings for countries, so it's based on what the government does as far as loans, risk-rating-wise.

Q: You mean the government --

MR. BOWAB: The Government of the United States. As you know, we have our own, we have our own system for assessing risk when we use taxpayers' monies to make loans. So that is OMB's prediction that risk will be less in '02.

Q: With regards to the increase in FTEs, what is the breakout between civil service, foreign service? You mentioned 360 at one point and then 186 for security. Is that part of that? Is that in addition?

MR. MILLETTE: I can get you that detail. With the 360, that's broken down between 205 foreign service generalists and 105 foreign service specialists and 50 civil service. That makes up to 360. The DS component, they're seeking 105 specialists, which is on the foreign service side, made up of -- specialist is probably not the best word -- but it's security engineers overseas, your RSO type individuals and some security technicians. That makes 105 of them, and then there's 81 civil service -- foreign service security specialists.

Q: On the Andean initiative, under interdiction, what exactly is this covering, in a little bit more detail?

MR. MACK: Interdiction means are the means of reducing the flow of cocaine out of the Andean countries. It also involves interdicting entry of precursor chemicals into the producing zones. So it's a combination.

Q: So what programs exactly in detail, or a few details, does this money go to?

MR. MACK: Well, some of it involved land, sea and air. Some of it involves terrestrial interdiction, some of it involves assistance to rivery interdiction programs, and some of it involves upgrades of regional air force capability of intercepting drug aircraft. And some of it involves radar.

Q: Can I ask a quick question on East Asia? What percentage of the $17 million allotted to migrant and refugee assistance will be used to support reintegration in Burma, Laos, and East Timor?

MR. BOWAB: I'll have to get you that answer. I don't know.

Q: Okay.

Q: It looks (inaudible) --

MR. BOWAB: In 2001, part of the number included a $210 million supplemental, appropriation in 2001 for the HIPC Trust Fund, which is not required in 2002.

Q: About USAID. Has this budget included any of the structural changes that Senator Helms has requested with regards to USAID? He wanted to create a private trust fund that would go for -- largely, I guess, religious charities, and could you sort of address that issue?

MR. BOWAB: Yes, I think if you read it, and it will be more detail in the larger budget that will come out next month. Yes, this is a start on that.

Q: Can you explain a little bit more about how it's a start on this?

MR. BOWAB: There is going to be some funding that will be held out, and I think it is called -- Pam, what's it called? The Global Development Alliance, and that funding will be used to look at supporting programs -- globally supporting programs through organizations other than the standard way or the standard organizations that USAID deals with.

Q: Can you have an estimate of how much that's going to be, and it's just going to be -- it's money to study the prospects of this, or is it the --

MR. BOWAB: No, it's actually money to do programmatic things. Right now, we're looking at $160 million.

Q: Okay. Well, can you -- I'm sorry, I just want to make sure I understand it -- this would be to look at funding these kinds of international faith-based groups specifically? Is it --

MR. BOWAB: I don't know specifically if we have justified it under faith-based organizations right now.

Q: Well, what's the criteria for getting the 160?

MR. BOWAB: Pam, do you have anything on that?

MS. CALLEN [Deputy Director, Office of Budget, USAID]: Iím Pam Callen from USAID Budget Office. The Global Development Alliance is a concept that was developed really to follow on to some of the types of activities that we're already doing in a lot of places to try to leverage funding that's on the ground. Obviously, we're not working in these countries alone. There are already partners on the ground in many of the places that we operate, as well as here at headquarters. We form a lot of alliances.

We're looking to perhaps be a little more creative about that with regard to not only faith-based organizations, but all types of private voluntary organizations, and other international donors, and the private sector. We have had some -- the private sector spins off a lot of development efforts on the ground, and so we have been able to work with them strategically in that way.

And so we're looking at using this $160 million for those types of things. Is that responsive?

Q: Can you -- just one more. Has this been developed in any kind of cooperation with Senator Helms' staff?

MS. CALLEN: You know, it's been an internal effort thus far. I'm sure that we will be talking to -- I don't know if LPA -- I don't think that there has been any discussion outside the Agency extensively just yet, but that's obviously something that's going to have to happen.

Q: Yes, I have one part. The Tropical Forests Conservation apparently seems to have gone down. I just wanted to check why that was? What happened --

MR. BOWAB: What was your --

Q: The Tropical Forests Conservation Act money -- unless I am mistaken, which is entirely possible -- has gone down. Can you tell me why that is?

MR. BOWAB: It hasn't gone down. What you will see is that in '02 you won't find a number associated with it, because in the budget we have requested a transfer authority of $13 million in order to take care of that.

Q: Okay. It's just (inaudible) within a reduced total funding (inaudible), which sounds like another way of saying a reduction.


Q: No?


Q: But it does seem like almost nothing has lost any money here.

Q: Which is kind of magical.

Q: Exactly. And I can find some things that have lost some money. Can you explain who decides -- which international organizations get contributions? Because I notice there's some pretty sketchy ones in here, kind of like "The International Seed Testing Association" and "The International Rubber Study Group" are held even, while an obviously worthwhile one like "The International Office of the Vine and Wine" is totally cut. Why? How are those choices made?

MR. MILLETTE: Those are assessed contributions, and the billings are based on assessed contributions, and, as you know, there was -- the deal that was negotiated, that some of those organizations that are tied to the UN scale had a reduction down to the --

Q: To nothing.

MR. MILLETTE: I think there are two small ones that we are actually proposing withdrawing from, and I think that's -- the Wine and Vine is one, and --

Q: Well, I for one wanted to protest.

Q: What was the policy-thinking behind that?


Q: Withdrawing from the International Wine and Vine --

MR. MILLETTE: I would have to get you the exact policy.

Q: But on the larger question, I mean, some programs somewhere are just simply going to have to get less money. Are you saying, no, that they don't? Every single -- there hasn't been a single program in here that has not been eliminated, whose time wasn't due. Is that what you're saying?

MR. BOWAB: No, I mean, obviously --

Q: Well, I mean, there are -- you are not dropping funding for any initiative in here that wasn't due to expire already anyway.

MR. BOWAB: I mean, I don't know. I haven't gone through every single line item, but everything that we had a need to do a program on we funded.

Q: Right, but I mean, everything that everyone in here has come up with -- I mean, we are looking at and seeing reductions -- for every single one of them, you said, well, that's taken care of someplace else.

MR. BOWAB: Right.

Q: And so we just haven't found them yet? Is that the --

MR. BOWAB: You're probably not going to find a lot of programs in '02 that were reduced from '01 levels. I think most of them you're going to find in most of the accounts were straight-line, and some were actually increased.

Q: As far as military financing, why the request for South Africa this year?

MR. BOWAB: There's probably two reasons why. One is, they have C-130s -- US-origin C-130s -- that they helped during the flood relief in Mozambique. They did quite an effort. They need support for the C-130s, and they are not doing it out of their own budget.

So the support they provided with those C-130s, that they're willing to do and they're willing to do peacekeeping efforts with them, that's one of the reasons for providing foreign military financing in South Africa.

The other reason is because of actually the declination in the South African Defense Force. They are having problems right now within the South African Defense Force, in a number of different areas, and they have asked us to come in and help them in a number of different areas, that we are willing to go in and do training with them, and do a bunch of other programs with them.

So that's the gist of the $7 million for South Africa.

Q: Is that part of the ACRI?

MR. BOWAB: No, it's not.

Q: Secretary Powell talked about cutting middle-management layers, and eliminating some of those special envoys and so forth, those kinds of positions. Have you all decided in this budget where those cuts are going to take place?

MR. BOWAB: Yes, I will be finished right after this briefing. (Laughter.)

MR. REEKER: (Inaudible) which special envoy positions were eliminated, and what you're continuing and what you're going to be reviewing for a few more months (inaudible) --

Q: Great. And how about the middle-management layers?

MR. REEKER: (Inaudible.) Let's just do a couple that haven't asked a question.

Q: Could you give specific figures on Russia, and to compare the decline from year 2000 from 836 to 808. How could you comment on this?

MR. BOWAB: Ambassador Taylor, are you here? We'll have our NIS Coordinator talk to you. Did you hear that?

MR. TAYLOR [William Taylor, Coordinator, Assistance to the New Independent States]: The question is on the numbers for Russia, and you're looking at the 2000 actual, and looking over at 2001 is about 167, and 2002, the request is about the same at 167. We are going through a review of assistance programs to Russia, and without prejudging the outcome of that review, we asked for the same amount in 2002 as in 2001.

The large amount in 2000 was in response to concern about -- the large number that you see there, the 186 -- was in response to the concern about the ability of the Russians to meet arms control commitments following the August '98 financial crash, and so that was more of a one-time effect that we funded at that time and didn't fund last year, and we're not requesting funds for that this year.

Q: And could you give specific figures on Russia? I mean, assistance in --

MR. TAYLOR: I can give you just the numbers that are in your book here. On page 53, is that what you're looking at? Yes. On 53 in the middle of the page, you can see $167 million requested for Russia.

Q: Is KEDO up because the price of oil is up?


Q: That's the only reason?


MR. REEKER: Okay. And thank you all very much. Thank you all.

(The briefing was concluded at 3:50 p.m.)

Released on April 9, 2001

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