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 You are in: Secretary of State Condoleezza Rice > Former Secretaries of State > Former Secretary of State Colin L. Powell > Speeches and Remarks > 2002 > February

Statement on President Bush's Budget Request for FY 2003

Secretary Colin L. Powell
House Appropriations Subcommittee on Foreign Operations, Export Financing, and Related Programs
Washington, DC
February 13, 2002

As Delivered

As Prepared

Mr. Chairman, members of the committee, I am pleased to appear before you to testify in support of President Bush’s budget request for FY 2003.

Let me say here at the outset, Mr. Chairman, before I go into the details of the budget and our foreign policy, that President Bush has two overriding objectives that our foreign policy must serve before all else. These two objectives are to win the war on terrorism and to protect Americans at home and abroad. This Administration will not be deterred from accomplishing these objectives. I have no doubt that this committee and the Congress feel the same way.

Last May, Mr. Chairman, you may recall that in your opening statement you reminded me that this subcommittee provides two-thirds of the funds that the State Department needs and uses. And I told you that your words were emblazoned on my forehead.

They still are.

You may also remember that I told you that I believe I am chief officer, chairman, CEO, and COO of the State Department. I have these responsibilities as well as those of being principal foreign policy advisor to the President.

Wearing that hat, my CEO hat, I want to tell you that we have made solid advances over the past year – advances in hiring, in bringing state of the art information technology to the Department, and in streamlining our overseas buildings process and in making our buildings more secure for our people.

Morale is high at the Department and we owe this Congress a debt of gratitude for what it has done to make this progress possible. The organization and conduct of America’s foreign policy stands on firm ground, and I want to thank you, Mr. Chairman, and all the members of this subcommittee.

Since that heart-rending day in September when the terrorists struck in New York, Virginia, and Pennsylvania, we have seen why the conduct of our foreign policy is so important.

We have had great success over the past five months in the war on terrorism, especially in Afghanistan. And behind the courageous men and women of our armed forces has been the quiet, steady course of diplomacy, assisting our military’s efforts to unseat the Taliban government and defeat the al-Qaida terrorists in Afghanistan.

We’ve reshaped that whole region – a new U.S.-Pakistan relationship, a reinvigorated U.S.-India relationship, a new Interim Authority in Kabul, the Taliban gone, and the terrorist’s dead, in jail, or on the run. We are also forming important new relationships with the nations of Central Asia.

At the same time, we and our partners have made significant progress in combating the terrorist menace beyond South Asia. From Spain to the Philippines, numerous arrests have been made, terrorist cells disrupted, and future attacks thwarted. Nearly $80 million in suspected terrorist assets have been frozen worldwide. And we have demonstrated our resolution to wage the war as long as is necessary to defeat terrorism.

In his second visit to the Department last year, President Bush told us that despite the great tragedy of September 11, we could see opportunities through our tears – and at his direction, the Department of State has been at flank speed ever since, making as much as possible of those opportunities.

We need to continue this momentum.

Over the past year, Mr. Chairman, I believe the broader tapestry of our foreign policy has become clear: to encourage the spread of democracy and market economies and to bring more nations to the understanding that the power of the individual is the power that counts. And when evil appears to threaten this progress, America will confront that evil and defeat it – as we are doing in the war on terrorism.

In weaving this tapestry, we have achieved several successes in addition to the successes of the war on terrorism and the regional developments its skillful pursuit has made possible. Let me highlight several.

With regard to Russia, President Bush has defied some of our critics and structured a very strong relationship. The meetings that he had with President Putin and the dialogue that has taken place between Russian Foreign Minister Ivanov and me and between Secretary of Defense Rumsfeld and his counterpart, and at a variety of other levels, have positioned the United States for a strengthened relationship with the land of eleven time zones.

The way that Russia responded to the events of September 11 was reflective of this positive relationship. Russia has been a key member of the antiterrorist coalition. It has played a crucial role in our success in Afghanistan, by providing intelligence, bolstering the Northern Alliance, and assisting our entry into Central Asia. As a result, we have seriously eroded the capabilities of a terrorist network that posed a direct threat to both of our countries.

Similarly, the way we agreed to disagree on the ABM Treaty reflects the intense dialogue we had over eleven months, a dialogue in which we told the Russians where we were headed and we made clear to them that we were serious and that nothing would deter us. And we asked them if there was a way that we could do what we had to do together, or a way that they could accept what we had to do in light of the threat to both of our countries from ballistic missiles.

At the end of the day, we agreed to disagree and we notified Russia that we were going to withdraw from the ABM Treaty. I notified FM Ivanov – we talked about our plans for two days. President Bush called President Putin. Then the two presidents arranged the way we would make our different announcements. And the world did not end. An arms race did not break out. There is no crisis in Russia-U.S. relations. In fact, our relations are very good. Both presidents pledged to reduce further the number of their offensive nuclear weapons and we are hard at work on an agreement to record these mutual commitments. This is all part of the new strategic framework with Russia.

We even managed to come to an agreement on how we are going to work through NATO. We are now developing mechanisms for pursuing joint Russia-NATO consultations and actions "at 20" on a number of concrete issues. Our aim is to have these mechanisms in place for the Reykjavik ministerial in May. And as we head for the NATO Summit in Prague in November, I believe we will find the environment for the continued expansion of NATO a great deal calmer than we might have expected.

I believe the way we handled the war on terrorism, the ABM Treaty, nuclear reductions, and NATO is reflective of the way we will be working together with Russia in the future. Building on the progress we have already made will require energy, good will, and creativity on both sides as we seek to resolve some of the tough issues on our agenda. We have not forgotten about Russian abuse of human rights in Chechnya, Moscow’s nuclear proliferation to Iran, or Russian intransigence with respect to revision of Iraq sanctions. Neither have we neglected to consider what the situation in Afghanistan has made plain for all to see: how do we achieve a more stable security situation in Central Asia? We know that this is something we cannot do without the Russians and something that increasingly they realize can’t be done without us, and without the full participation of the countries in the region. We are working these issues as well.

In fact, the way we are approaching Central Asia is symbolic of the way we are approaching the relationship as a whole and of the growing trust between our two countries. We are taking issues that used to be problems between us and turning them into opportunities for more cooperation. Such an approach does not mean that differences have vanished or that tough negotiations are a thing of the past. What it means is that we believe there are no insurmountable obstacles to building on the improved relationship we have already constructed.

It will take time. But we are on the road to a vastly changed relationship with Russia. That can only be for the good – for America and the world.

We have also made significant progress in our relationship with China.

We moved from what was a potentially volatile situation in April involving our EP-3 reconnaissance aircraft which was forced to land on China’s Hainan Island after a PLA fighter aircraft collided with it, to a very successful meeting in Shanghai in October between President Jiang Zemin and President Bush and an APEC Conference, hosted by China, that was equally successful.

There are certain shared interests that we have with China and we have emphasized those interests. They are regional and global interests, such as China’s accession to WTO, stability on the Korean Peninsula, and combating the scourge of HIV/AIDs. On such issues we can talk and we can produce constructive outcomes.

There are other interests where we decidedly do not see eye-to-eye, such as arms sales to Taiwan, human rights, religious freedom, and missile proliferation. On such issues we can have a dialogue and try to make measurable progress.

But we do not want the interests where we differ to constrain us from pursuing those where we share common goals. And that is the basis upon which our relations are going rather smoothly at present. That, and counterterrorism.

President Jiang Zemin was one of the first world leaders to call President Bush and offer his sorrow and condolences for the tragic events of September 11. And in the almost five months since that day, China has helped in the war against terrorism. Beijing has also helped in the reconstruction of Afghanistan and we hope will help even more in the future.

Moreover, China has played a constructive role in helping us manage over these past few weeks the very dangerous situation in South Asia between India and Pakistan. When I could call China’s Foreign Minster Tang and have a good discussion, making sure our policies were known and understood, it made for a more reasoned approach to what was a volatile situation. As a result, China supported the approach that the rest of the international community had taken. Beijing was not trying to be a spoiler but instead was trying to help us alleviate tensions and convince the two parties to scale down their dangerous confrontation – which now it appears they are beginning to do.

All of this cooperation came as a result of our careful efforts to build the relationship over the months since the EP-3 incident. We never walked away from our commitment to human rights, non-proliferation, or religious freedom; and we never walked away from the position that we don’t think the Chinese political system is the right one for the 21st century. And we continued to tell the Chinese that if their economic development continues apace and the Chinese people see the benefits of being part of a world that rests on the rule of law, we can continue to work together constructively.

A candid, constructive, and cooperative relationship is what we are building with China. Candid where we disagree; constructive where we can see some daylight; and cooperative where we have common regional or global interests. These are the principles President Bush will take with him to Beijing later this month. After meeting with Prime Minister Koizumi in Tokyo and with President Kim in Seoul, the President will spend a day and a half in Beijing and meet with President Jiang Zemin, as well as Premier Zhu Rongji. He will have ample opportunity to put these principles to work.

As we improved our relationship with China, we also reinvigorated our bilateral alliances with Japan, Korea, and Australia. Nowhere has this been more visible than in the war on terrorism – where cooperation has been solid and helpful.

Prime Minister Koizumi immediately offered Japan’s strong support, within the confines of its constitution. And he is working to enhance Japan’s capability to contribute to such global and regional actions in the future. President Bush’s dialogue with this charismatic and popular Japanese leader has been warm, engaging, and productive. Always the linchpin of our security strategy in East Asia, the U.S.-Japan Security Alliance is now as strong a bond between our two countries as it has been in the half-century of its existence. Our shared interests, values, and concerns, plus the dictates of regional security, make it imperative that we sustain this renewed vigor in our key Pacific alliance. And we will.

With respect to the Peninsula, our alliance with the Republic of Korea (ROK) has also been strengthened by Korea’s strong response to the war on terrorism and by our careful analysis of and consultations on where we needed to take the dialogue with the North. President Bush has made it very clear that we are dissatisfied with the actions of North Korea; in particular that the north continues to develop and sell missiles that could carry weapons of mass destruction. But we have also made clear that both we and the ROK are ready to resume dialogue with Pyongyang, on this or any other matter, at any time the North Koreans decide to come back to the table. The ball is in North Korea’s court.

The Australians have been clearly forward leaning in their efforts to support the war on terrorism. Heavily committed in East Timor already, Australia nonetheless offered its help immediately and we have been grateful for that help. The people of Australia are indeed some of America’s truest friends.

As I look across the Pacific to East Asia I see a much-improved security scene and I believe that President Bush deserves the credit for this success.

Another foreign policy success is the improvement we have achieved in our relations with Europe. In waging war together on terrorism, our cooperation has grown stronger. NATO invoked Article 5 for the first time ever on September 12. Since then, the European Union has moved swiftly to round up terrorists, close down terrorist financing networks, and improve law enforcement and aviation security cooperation.

Moreover, President Bush has made clear that even as we fight the war on terrorism, we will not be deterred from achieving the goal we share with Europeans of a Europe whole, free, and at peace. We continue to work toward this goal with our Allies and Partners in Europe. While in the Balkans there remain several challenges to our achieving this goal, we believe we are meeting those challenges. We have seized war criminals, helped bring about significant changes in governments in Croatia and Yugoslavia, and our military forces are partnered with European forces in Kosovo and Bosnia to help bring stability and self-governance, while European-led action fosters a settlement in Macedonia. We need to finish the job in the Balkans – and we will. We went in together with the Europeans, and we will come out together.

I also believe we have been successful in bringing the Europeans to a calmer level of concern with respect to what was being labeled by many in Europe "unbridled U.S. unilateralism". Notwithstanding the recent reaction in parts of Europe to President Bush’s State of the Union Address, I still believe this to be true.

There was significant concern among the Europeans earlier last year that because we took some unilateral positions of principle for us that somehow the U.S. was going off on its own without a care for the rest of the world. This was particularly true with respect to the Kyoto Protocol. So we set out immediately to correct this misperception. Beginning with President Bush’s speech in Warsaw last June, his participation in the G-8 meetings and the European Union summit in July, our extensive consultations with respect to the new strategic framework with Russia, and culminating in the brilliant way in which the President pulled together the coalition against terrorism, I believe that we demonstrated to the world that we can be decisively cooperative when it serves our interests and the interests of the world.

But we have also demonstrated that when it is a matter of principle, we will stand on that principle. In his first year in office President Bush has shown the international community who he is and what his administration is all about. That is an important accomplishment – and one that is appreciated now everywhere I go. People know where America is coming from and do not have to doubt our resolve or our purpose. They may not always agree with us, but they have no doubt about our policy or our position. We want to ensure that this policy clarity and this firmness of purpose continue to characterize our foreign policy, and not just with the Europeans but with all nations.

Let me just note that this sort of principled approach characterizes our determined effort to reduce the threat from weapons of mass destruction – an effort well underway before the tragic events of September 11 added even greater urgency. We and the Russians will reduce our own deployed nuclear weapons substantially. In the meantime, we are using a comprehensive approach, along with our friends and allies, to tackle WMD elsewhere, an approach that includes export controls, non-proliferation, arms control, missile defenses, and counter-proliferation. As you heard President Bush say in his State of the Union address to the Congress, "the price of indifference [to WMD] would be catastrophic."

Director of Central Intelligence Tenet emphasized in his testimony last week that there are terrorists in the world who would like nothing better than to get their hands on and use nuclear, chemical, or biological weapons. So there is a definite link between terrorism and WMD. Not to recognize that link would be foolhardy to the extreme.

Such a principled approach does not equate to going it alone. Quite the contrary. We know that cooperation is often essential to get things done. On our efforts to lift countries out of poverty, for example, and to create conditions in which trade and investment flourish, we need to cooperate. This summer in Johannesburg, we will participate in the World Summit on Sustainable Development. There we will have an opportunity to address such issues as good governance; protection of our oceans, fisheries, and forests; and how best to narrow the gap between the rich countries and the poor countries of the world. And that brings me to my next high mark in our foreign policy for the past year, Africa.

Mr. Chairman, we have crafted a new and more effective approach to Africa – the success of which was most dramatically demonstrated in the WTO deliberations in Doha last November that led to the launching of a new trade round. The United States found its positions in those deliberations being strongly supported by the developing countries, most notably those from Africa. You may have some idea of how proud that makes America’s Secretary of State – proud of his country, and proud of this Congress for its deliberate work to make this possible. The Congress laid the foundation for our efforts with the African Growth and Opportunity Act – an historic piece of legislation with respect to the struggling economies in Africa. In the first year of implementation of this Act, we have seen substantial increases in trade with several countries – South Africa by 11 %, Kenya by 21%, Lesotho by 51%, and Madagascar by a whopping 117%, all based on the first three quarters of 2001 compared to the same period in 2000. Likewise, we are very pleased with the excellent success of the first U.S.-SubSaharan Africa Trade and Economic Cooperation Forum, which was held last October.

A large part of our approach to Africa and to other developing regions and countries as well, will be a renewed and strengthened concern with progress toward good governance as a prerequisite for development assistance. Where conditions are favorable, our development assistance in Africa will emphasize the vigorous promotion of agriculture. Agriculture is the backbone of Africa’s economies and must be revitalized to reduce hunger and to lift the rural majority out of poverty. In addition, we will emphasize fighting corruption and President Bush’s new initiative on basic education. Moreover, we want to emphasize methods that directly empower individuals – methods such as micro lending, a superb vehicle for increasing the economic participation and security of the working poor. The people of Africa in particular know that in many cases their governments do not deliver the health care, transportation and communication networks, education and training, and financial investment needed to create 21st century economies. They know that this must change if there is to be hope of economic success -- of job creation, private investment, stable currencies, and economic growth.

We also know and more and more of Africa’s people are coming to know that none of this economic success is possible if we do not meet the challenge of HIV/AIDS. That is why I am pleased to report that pledges to the Global Fund to Fight AIDS, Tuberculosis, and Malaria now exceed $1.7 billion and continue to grow. Soon, the Fund is expected to accept proposals and provide grants to partnerships in those countries with the greatest disease burden and the least resources with which to alleviate that burden.

We want the Global Fund to complement national, bilateral, and other international efforts to fight these dreaded diseases. Strong congressional support will ensure that the United States remains the leader in this global humanitarian and national security effort.

In our own hemisphere, Mr. Chairman, we have met with considerable success. Highlights have been the President’s warm relationship with Mexico’s President Fox, the Summit of the Americas in Quebec, and the signing of the Inter-American Democratic Charter in Lima, Peru. Now our focus is to create a Free Trade Area of the Americas – including, as President Bush described three weeks ago, not only our current negotiations with Chile but also a new effort to explore the concept of a free trade agreement with Central America.

Moreover, we have every expectation that the Financing for Development Conference in Mexico next month will be successful. There, the importance of good governance, trade, and private investment will be the focus. We need to keep democracy and market economics on the march in Latin America. And to be sure, there are some dark clouds moving in now, and one of the darkest looms over Colombia where a combination of narco-terrorism and festering insurgency threatens to derail the progress the Colombians have made in solidifying their democracy.

Our Andean Counterdrug Initiative is aimed at fighting the illicit drugs problem while promoting economic development, human rights, and democratic institutions in Colombia and its Andean neighbors. Intense U.S. support and engagement has been the critical element in our counterdrug successes in Bolivia and Peru and will continue to be critical as we help our regional partners strengthen their societies to confront and eradicate this threat to their own democracies and to America’s national security interests.

There is another element to this challenge caused by our intense focus right now and for the foreseeable future on the war on terrorism. U.S. military and law enforcement forces previously assigned to interdict the flow of drugs between South America and the United States have been reduced by more than fifty per cent. Because of this reduction we have less capability to stem the flow of drugs from south to north, thus we will be even more dependent on friendly countries in source and transit zones to help us deal with the drug threat.

For our Caribbean neighbors, the situation was made worse by the end results of September 11 -- lower growth, decreased tourism, increased unemployment, decreased tax revenue, and decreased external financial flows. This economic decline is compounded by high rates of HIV/AIDS infection and financial crime, as well as the traffic in illicit drugs.

President Bush’s Third Border Initiative (TBI) seeks to broaden our engagement with our Caribbean neighbors based on recommendations by the region’s leaders on the areas most critical to their economic and social development. The TBI is centered on economic capacity building and on leveraging public/private partnerships to help meet the region’s pressing needs. I visited the Caribbean at the end of last week and discussed these issues with regional leaders.

In addition to its economic provisions, the Third Border Initiative includes 20 million dollars for HIV/AIDS education and prevention efforts. This represents a two-fold increase in U.S. HIV/AIDS assistance to the region in just two years.

As you are aware, Mr. Chairman, our ties to the Caribbean region are as much cultural and human as they are economic and political. The countries of the Caribbean attract millions of American visitors every year and the region is our sixth largest export market. Large numbers of Caribbean immigrants have found their way to America, including, I am proud to say, my Jamaican forebearers. Here people from the region have found freedom and opportunity and have added something wonderful to the great American cultural mix. But our primary goal must be to help ensure that the peoples of the Caribbean find new opportunities for work, prosperity and a better life at home.

At the end of the day, it is difficult to exaggerate what we have at stake in our own hemisphere. Political and economic stability in our own neighborhood reduces the scale of illegal immigration, drug trafficking, terrorism, and economic turmoil. It also promotes the expansion of trade and investment. Today, we sell more to Latin America and the Caribbean than to the European Union. Our trade within NAFTA is greater than that with the EU and Japan combined. We sell more to MERCOSUR than to China. And Latin America and the Caribbean is our fastest growing export market. Clearly, the President is right to focus attention on this hemisphere and we will be working hard in the days ahead to make that focus productive, both economically and politically.

In that regard, we have a very positive vision for a future Cuba – a Cuba that is free, with a strong democratic government that is characterized by support for individual civil, political, and economic rights. A Cuba in which people are free to choose their own leaders and to pursue their own dreams. And a Cuba that is a good neighbor to all in the Caribbean and in the hemisphere at large. That such a Cuba can exist we have never doubted – just look at the contributions Cuban-Americans have made in our own country and you understand immediately what such people are capable of. Depriving the Castro regime of hard currency resources with which to repress its own people remains a key policy tool, as does our continued support for Cuba’s growing pro-freedom movement.

Mr. Chairman, in addition to the dark clouds I have described within our hemisphere, there are vexing problems that persist elsewhere, the most prominent of which are in the Middle East. The situation between Israel and the Palestinians, Iraq, and Iran are among our concerns.

With respect to the tragic confrontation between Israel and the Palestinians, we will continue to try and focus the parties on the need to walk back from violence to a political process. Our priorities have been and will remain clear: ending the violence and terror through establishment of an enduring cease-fire and then movement forward along the path outlined in the Tenet Security Workplan and the Mitchell Report recommendations, agreed to by both sides and supported by the international community. This forward movement would lead ultimately to negotiations on all the issues that must be resolved.

Israelis and Palestinians share a common dream: to live side-by-side in genuine, lasting security and peace in two states, Israel and Palestine, with internationally recognized borders. We share that hope for a better tomorrow for both peoples. President Bush expressed this positive vision in his speech to the United Nations last November, and I described it in my speech later that month in Louisville.

We must not become frustrated, or yield to those who would have us turn away from this conflict – or from this critical region. As the President has said, the United States has too many vital interests at stake to take such a step, and one of those vital interests is the security of Israel. We must not lose sight of what we have achieved through our hard work and diplomacy in the region and beyond. There is a path out of the darkness, accepted by both Israel and the Palestinians – the Tenet Workplan and the Mitchell Report. We have mobilized our friends and allies, including the UN, the European Union, Russia and others throughout the region and the world, to speak with one voice in supporting this road back to peace.

But first things first. Our positive vision will never be realized so long as violence and terror continue. The President and I, and General Zinni, have been unequivocal with Chairman Arafat. The Palestinian people will never see their aspirations achieved through violence. Chairman Arafat must act decisively to confront the sources of terror and choose once and for all the option of peace over violence. He cannot have it both ways. He cannot engage with us and others in pursuit of peace and at the same time permit or tolerate continued violence and terror. In that regard, I have made clear to Chairman Arafat that the smuggling of arms to the Palestinian Authority by Iran and Hizballah aboard the Karine A is absolutely unacceptable. Chairman Arafat must ensure that no further activities of this kind ever take place and he must take swift action against all Palestinian officials who were involved.

Chairman Arafat knows what he must do. Actions are required, not just words, if we are to be in the position of working effectively again with him to help restore calm and forward movement. Israel too must act. Prime Minister Sharon has spoken of his desire to improve the situation of Palestinian civilians, confronted with a disastrous economic situation and suffering daily. We have urged the Israeli government to act in ways that help ease these hardships and avoid further escalation or complicate efforts to reduce violence. Difficult as the present circumstances are, the United States will remain involved. But, in the end, Israel and the Palestinians must make the hard decisions necessary to resume progress toward peace.

With regard to Iraq, that country remains a significant threat to the region’s stability. We are working at the UN and elsewhere to strengthen international controls on Iraq. In the last year, we successfully stopped the free fall of sanctions and began to rebuild United Nations Security Council consensus on Iraq. The UNSC unanimously adopted resolution 1382 in November, committing itself to implement the central element of "smart sanctions" by May 30 of this year. This central element, or Goods Review List (GRL), identifies materials UNSC members must approve for export to Iraq and ensures continued supervision and control over dual-use goods. Its implementation will effectively lift economic sanctions on purely civilian trade and focus controls on arms, especially WMD. This will further strengthen support for UN controls by showing the international community that Saddam Hussein, not the UN and not the U.S., is responsible for the humanitarian plight of the Iraqi people. We are working with the Russians to get final agreement on the GRL.

At the end of the day, we have not ruled out other options with respect to Iraq. We still believe strongly in regime change in Iraq and we look forward to the day when a democratic, representative government at peace with its neighbors leads Iraq to rejoin the family of nations.

With regard to Iran, we have a long-standing list of grievances, from concerns about proliferation to Iran’s continued sponsorship of terrorism. We have been clear in communicating to Teheran that its support for terrorism remains a serious unaddressed concern – and this includes the case of the Karine A transporting arms.

Teheran’s latest provocation, besides the arms aboard the Karine A, has been its apparent unhelpful activities in the post-Taliban environment of western Afghanistan. This, after being quite helpful as we prosecuted the war against terrorism in Afghanistan and, at the Bonn Conference, being helpful with the setup of the Interim Authority in Kabul.

After citing the list of our grievances with Iran, however, I am still convinced that we may be able to talk to Iran, that we may be able to have a reasonable conversation with Iranian leaders. With respect to the situation in Afghanistan, for example, I believe we can demonstrate to them that it is not in their interest to destabilize the government that they helped to create in Bonn. The other issues will be more difficult; but I do believe constructive talks with Iran on Afghanistan are possible.

Mr. Chairman, let me now turn to Afghanistan and the war on terrorism.

In January, I was in Tokyo to join the European Union, Saudi Arabia, and Japan in hosting the Afghan Donor Conference. Representatives from over 60 countries attended, as well as experts from the Multilateral Development Banks, and a number of UN agencies. The conference helped to ensure that a wide range of countries will help the Afghans rebuild their country. The United States pledged almost $297 million at the conference and others pitched in accordingly. The total pledged at this point is around $4.5 billion with more than $1.8 billion for the first year.

But the heavy lifting with respect to Afghanistan is only just beginning. We have helped the Afghans remove the oppressive Taliban regime from their country. We have destroyed the al-Qaida network in Afghanistan, with our troops mopping up some of the remnants as we speak. We have made possible the delivery of humanitarian aid, including massive amounts of food. We have avoided the wholesale starvation that many predicted. Moreover, we have helped the people of Afghanistan establish a multi-ethnic Interim Authority in Kabul, led by Chairman Karzai. One of its ultimate goals is to oversee an agreed process that will lead to a broad-based Afghan government – one that represents all the people of the country, people of every background and region, women as well as men.

We also have a rare chance to disrupt seriously the flow of opium in the world, as Afghanistan has been the world’s largest source of this drug, which is the base for heroin. A government that is headed toward reconstruction, toward building a new and better life for its citizens, and a government that is concerned with feeding its population and giving them adequate education, good roads, clean water, and other needed services, will not be a government that permits the selling of opium to the world. And such a government needs to be secure as well.

Many of our key allies and partners are contributing to the International Security Assistance Force in Kabul to help ensure a secure environment for Mr. Karzai to build a new Afghanistan. We are reviewing whether or not more forces might be needed for this force and we will continue to look closely at the security needs as we move forward. We want to do everything possible to prevent the rise of any alternative power to the Interim Authority, until a permanent government can be established and begin to take care of that challenge on its own.

Much remains to be done and admittedly a lot of what remains will be difficult to accomplish. But we believe that at long last Afghanistan is on a positive track. There is no question that this is a time of great challenge for the Afghan people, but it is equally unquestionable that this is also a time of great hope. And, as President Bush pledged last week during Chairman Karzai’s visit to Washington: "The United States is committed to playing a leading role in the reconstruction of Afghanistan."

Mr. Chairman, I know that you are aware of the nature of the challenge we confront in Afghanistan. You and I met and talked in the airport at Islamabad. You and the members who accompanied you on that visit understand how the last 20 years of war and conflict have impacted on Afghanistan. You understand what is needed to reconstruct this country and that foremost of all what is needed is a long-term commitment by the international community. If we can ensure such a commitment, and if we can achieve proper accountability and use of the donor funds, then I believe there is a good chance of making significant progress in bringing a new future to Afghanistan – and ending the days of warlordism and political chaos that bred the Taliban and made a fertile ground for terrorists.

And as reconstruction begins in Afghanistan, the war against terrorism continues. As President Bush said in his State of the Union Address, "What we have found in Afghanistan confirms that, far from ending there, our war against terror is only beginning." The administration is working together in new ways never before envisioned. And that’s what this effort is going to require. FBI, CIA, INS, Treasury, State, NSC, the Attorney General and Justice Department, and others, are all coming together. This campaign is transnational, cross-border, even global in a way we have never contemplated.

What we are trying to do on the foreign policy side is to help analyze where al-Qaida cells might seek refuge. A country that immediately comes to mind is Somalia because it is quite a lawless place without much of a government and because it has been this sort of terrorist haven in the past, providing training camps, communications links, and financial cover.

We are watching Somalia very closely. Terrorism might find fertile ground there and we do not want that to happen. No plans have been made – yet. But if we find al-Qaida there, you can rest assured we will take the appropriate action.

We have also had a good dialogue with President Ali Abdallah Salih of Yemen and we believe that actions he is taking are a good first step toward the goal of uprooting the al-Qaida network there.

There are other countries we are working with as well, some of whom have their own sort of terrorist problem that has spillover into our own problem. The Philippines has the Abu Sayyaf, who in the past have had connections with al-Qaida. But this is not just a campaign against al-Qaida – it is a campaign against terrorism throughout the world.

So we are working with President Arroyo in the Philippines to assist that country in combating its terrorists – who as you know right now hold two American citizens as hostages.

We are also working with the Sudan, a country with whom we have had major difficulties in the past few years. Even before September 11 we had been working with the Sudanese, asking them "What do you get for this? What do you get for letting people like these terrorists have safe haven in the Sudan? What does it do for you except bring down the condemnation of the world?" And they have been somewhat responsive. The problems in the Sudan are not solved by any means. But some new opportunities have opened up.

As you can see, then, part of our approach to this extended campaign against terrorism is to work with countries such as the Sudan. We are not being naïve, not being unmindful of the challenges that exist, but using diplomacy, using good people like Senator Danforth and others, and at the same time cooperating together on intelligence and law enforcement activities to put a stop to easy passage or safe haven for terrorists.

We have not made any recommendation to the President about the major use of military force and the President has made no decision as yet with respect to such use of force. But there are many other actions that are taking place – actions of a law enforcement, political, diplomatic, financial, and intelligence-sharing nature.

Mr. Chairman, as I said earlier a sizable portion of the President’s budget request is dedicated to these counterterrorism efforts, as you will see as I turn to the specific priorities of our budget request for Foreign Operations.

The President’s FY 2003 request for Foreign Operations is a little over $16.1 billion. These dollars will support the continuing war on terrorism, the work we are doing in Colombia and the Andean region at large, our efforts to combat HIV/AIDS and other infectious diseases, essential development programs in Africa, the important work of the Peace Corps and the scaling up of that work, and our plan to clear arrearages at the Multilateral Development Banks, including the Global Environment Facility.

War on Terrorism

To fight terrorism as well as alleviate the conditions that fuel violent extremism, we are requesting an estimated $5 billion. In addition to initiatives included in the budget request for State Department and Related Agencies, this funding includes:

  • Foreign assistance – $3.6 billion for economic and security assistance, military equipment, and training for front-line states and our other partners in the war on terrorism. This includes --
  • $3.4 billion from Foreign Operations accounts such as the Economic Support Fund, International Military Education and Training, Foreign Military Financing, and Freedom Support Act.

  • $88 million for programs in Russia and other states of the former Soviet Union to reduce the availability to terrorists of weapons of mass destruction. Ongoing programs engage former weapons scientists in peaceful research and help prevent the spread of the materials expertise required to build such weapons.
  • $69 million for counterterrorism engagement programs, training, and equipment to help other countries fight global terror, thereby strengthening our own national security.
  • $4 million for the Treasury Department’s Office of Technical Assistance to provide training and other necessary expertise to foreign finance offices to halt terrorist financing.

And Mr. Chairman, in the FY 2003 budget request there is approximately $140 million available for Afghanistan, including repatriation of refugees, food aid, demining, and transition assistance. I know that President Bush, the Congress, and the American people recognize that re-building that war-torn country will require additional resources and that our support must be and will be a multi-year effort. Moreover, we do not plan to support reconstruction alone and we will seek to ensure that other international donors continue to do their fair share.

To meet our commitment to assist Afghanistan in its reconstruction efforts, we will need a supplemental appropriation this year. Also, there are other areas associated with the war on terrorism where we may need supplemental funding this year. Right now we are working the details with OMB.

Andean Counterdrug Initiative

We are requesting $731 million in FY 2003 for the multi-year counter-drug initiative in Colombia and other Andean countries that are the source of the cocaine sold on America's streets. ACI assistance to Andean governments will support drug eradication, interdiction, economic development, and development of democratic government institutions. In addition, the Colombians will be able to stand up a second counterdrug brigade. Assisting efforts to destroy local coca crops and processing labs there increases the effectiveness of U.S. law enforcement here.

In addition to this counterdrug effort, we are requesting $98 million in FMF to help the Colombian Government protect the vital Cano Limon-Covenas oil pipeline from the same foreign terrorist organizations involved in illicit drugs, the FARC and the ELN. Their attacks on the pipelines shut it down 240 days in 2001, costing Colombia revenue, causing serious environmental damage, and depriving us of a source of petroleum. This money will help train and equip two brigades of the Colombian armed forces to protect the pipeline.

Global Health and HIV/AIDS

In FY 2003, we are requesting $1.4 billion for USAID global health programs. Of this amount, we are requesting $540 million for bilateral HIV/AIDS prevention, care, and treatment activities, and $100 million for the Global Fund to Fight AIDS, Tuberculosis, and Malaria, to which I referred earlier. All of this funding will increase the already significant U.S. contribution to combating the AIDS pandemic and make us the single largest bilateral donor to the effort. I should add that the overall U.S. Government request for international HIV/AIDS programs exceeds one billion dollars, including $200 million for the Global Fund.

The Peace Corps

All of you heard the President’s remarks in his State of the Union address with respect to the USA Freedom Corps and his objective to renew the promise of the Peace Corps and to double the number of volunteers in the Corps in the next five years. We have put $320 million for the Peace Corps in the FY 2003 budget request. This is an increase of over $42 million over our FY 2002 level. This increase will allow us to begin the scaling up that the President has directed. The Peace Corps will open programs in eight countries, including the reestablishment of currently suspended posts, and place over 1,200 additional volunteers worldwide. By the end of FY 2003 the Peace Corps will have more than 8,000 volunteers on the ground.

MDB Arrears

The FY 2003 request includes an initiative to pay one third of the amount the United States owes the Multilateral Development Banks (MDBs) for our scheduled annual commitments. With U.S. arrears currently now totaling $533 million, the request would provide $178 million to pay one third of our total arrears during the fiscal year. The banks lend to and invest in developing economies, promoting economic growth and poverty reduction and providing environmental benefits. We need to support them.

Mr. Chairman, as I told this committee last year, the conduct of the nation’s foreign policy suffered significantly from a lack of resources over the past decade. I have set both my CEO hat and my foreign policy hat to correct that situation. But I cannot do it without your help and the help of your colleagues in the House and across the capitol in the Senate. I believe we have demonstrated in the past year that we are worth the money. I believe we have demonstrated that we can be wise stewards of the people’s money and put it to good use in the pursuit of America’s interests abroad. I also believe that we have demonstrated conclusively that we are essential to that process of pursuing the nation’s interests. With your able assistance, we will continue to do so in the months ahead.

Thank you, and I will be pleased to take your questions.


Released on February 13, 2002

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