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49–196 CC








MAY 6, 1998

Printed for the use of the Committee on International Relations

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BENJAMIN A. GILMAN, New York, Chairman
HENRY J. HYDE, Illinois
CASS BALLENGER, North Carolina
EDWARD R. ROYCE, California
JAY KIM, California
TOM CAMPBELL, California
JON FOX, Pennsylvania
LINDSEY GRAHAM, South Carolina
ROY BLUNT, Missouri
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RICHARD BURR, North Carolina
SAM GEJDENSON, Connecticut
TOM LANTOS, California
PAT DANNER, Missouri
BRAD SHERMAN, California
BOB CLEMENT, Tennessee
BILL LUTHER, Minnesota
JIM DAVIS, Florida
LOIS CAPPS, California
RICHARD J. GARON, Chief of Staff
MICHAEL H. VAN DUSEN, Democratic Chief of Staff
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Subcommittee on the Western Hemisphere
ELTON GALLEGLY, California, Chairman
CASS BALLENGER, North Carolina
JAY KIM, California
ROY BLUNT, Missouri
JIM DAVIS, Florida
VINCE MORELLI, Subcommittee Staff Director
PAUL BONICELLI, Professional Staff Member
DAVID ADAMS, Democratic Professional Staff Member

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    The Honorable Peter F. Romero, Principal Deputy Assistant Secretary, Bureau of Inter-American Affairs, U.S. Department of State
    Mr. Mark Schneider, Assistant Administrator, Bureau for Latin America and the Caribbean, U.S. Agency for International Development
Prepared statements:
The Honorable Peter F. Romero
Mr. Mark Schneider, plus attachments

House of Representatives,
Subcommittee on the Western Hemisphere
Committee on International Relations,
Washington, DC.
    The Subcommittee met, pursuant to notice, at 1:30 p.m., in room 2172, Rayburn House Office Building, Hon. Elton Gallegly (chairman of the Committee) presiding.
    Mr. GALLEGLY. [presiding] Today the Subcommittee will take a look at the current political, economic, and social conditions in the Western Hemisphere and receive an analysis of the recently completed Santiago Summit.
    I am pleased to welcome Principal Deputy Assistant Secretary, Peter Romero, and USAID Assistant Administrator, Mark Schneider.
    Before we begin, I do want to note that we had intended to hear from Assistant Secretary Davidow in what may have been his last appearance before the Subcommittee. Secretary Davidow has, as I know most of you are aware, been nominated by the President to be the next U.S. Ambassador to Mexico. I certainly want to take this time to personally thank Secretary Davidow for his work on inter-American issues and the assistance he has given me on many specific matters as well. I know we all wish him well in his confirmation process, and in Mexico City.
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    Last March, when this Subcommittee held a similar oversight hearing, I laid out what I thought were five themes our policy toward Latin America should focus on. These themes included continued support of democratization; economic growth and poverty alleviation; drugs, crime, and corruption-free police and judiciaries; trade; and a more proactive U.S. approach to Latin America.
    In assessing the situation a year ago, I would say we have some good news and, unfortunately, some disappointing news on those themes.
    On the plus side, free and fair elections continue to be held throughout the region. Economic development and growth continued in most countries, and trade is flourishing. With at least four visits to the region by our President and numerous others by Secretary Albright and Special Envoy MacClarty, U.S. policy has been active.
    Nevertheless, there are some negatives. As was pointed out at Santiago, not everyone is enjoying the benefits of democracy. In fact, two recent public opinion polls conducted in the region suggest that there has been growing frustration with democracy. Economic growth has benefited many, but poverty is still way too high. Drugs continue to flow unimpeded throughout the region, and crime and judicial corruption continue at alarming rates.
    Recognizing that these problems are large and cannot be resolved over night, what all of this means is that there is still a lot of work to be done within the region.
    Aside from these issues, I have concerns about several more specific issues which I will simply highlight here and perhaps solicit your thoughts later in the hearing.
    First is what appears to be a growing popularity among sitting Presidents to change the constitutional prohibitions on successive terms, and with former military leaders as Presidential candidates. In several countries ex-military generals, including some involved in past coup attempts, have risen to lead in the popular opinion. What do these developments say about the state of democracy in Latin America?
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    The second is the growing violence in the Colombia guerilla war and the apparent inability of that nation's armed forces or political leaders to protect their democracy.
    The third is the continued political stalemate in Haiti.
    And the fourth is the on-again, off-again negotiations with Panama regarding the future presence of the United States in that nation as a part of the multi-national anti-narcotics center.
    Before we begin, I would yield to my friend, the Ranking Member, who apparently isn't here, Mr. Ackerman. Mr. Menendez, would you have an opening statement?
    At this time, I would yield to the gentleman from New Jersey, Mr. Menendez.
    Mr. MENENDEZ. Thank you, Mr. Chairman. I'm glad to see that you're holding this hearing.
    Mr. Chairman, the Summit of the Americas process is about many things. It's about improving economies, fostering free and fair trade, access to education, the elimination of poverty, combating narcotics trafficking, and a mutual commitment to principles of democracy and respect for human rights.
    The Declaration of Santiago, signed by all 34 democratic nations in the hemisphere, reaffirms each country's commitment to the summit process, and to the strengthening of hemispheric cooperation. While this year's theme was education, a very important theme for the social and economic development of the hemisphere, the Declaration also speaks to democracy and human rights. And it says this about democracy and I quote: ''the strength and meaning of representative democracy lie in the active participation of individuals at all levels of civic life. A democratic culture must encompass our entire population.'' And on human rights, it says this and I quote: ''respect for and promotion of human rights and fundamental freedom of all individuals is a primary, primary concern for our government. In commemorating the 50th anniversary of the American Declaration of Rights and Duties of Man, and the Universal Declaration of Human Rights, we agree on the need to promote the ratification and implementation of international agreements aimed at preserving and to continue strengthening the pertinent national and international institutions. We agree that a fair press plays a fundamental role in this area, and we reaffirm the importance of guaranteeing freedom of expression, information, and opinion.''
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    But when the wining and the dining and the champagne toasts to democracy and human rights were over, the countries that so glowingly talked about it in Santiago failed one of their brethren in the Western Hemisphere. When it came to implementing the Universal Declaration of Human Rights over a few weeks at the U.N. Commission on Human Rights in Geneva, only two Latin Governments actually did so. The others let politics obscure the facts when considering the U.S. resolution on the ongoing abuses of human rights in Cuba and the extension of the mandate for the special rapporteur, who was never ever allowed to enter Cuba.
    Now, while I'm one of the strongest advocates in the Congress for the nations of the hemisphere and for having USAID promote a greater part of its budget toward it, I'm deeply saddened and offended by the refusal of many nations in this hemisphere to stand up for the principles of democracy and human rights enshrined in the Declaration of Vina del Mar and Santiago, to which they are signatories, and to which they were so toasting away. Further efforts to facilitate Cuba's re-entry into the Organization of American States defy the progress toward respect for democracy and human rights which has transformed the hemisphere in the past two decades. Cuba today, as in 1962 when it was excluded from the OAS, remains fundamentally at odds with the principles of the OAS and the language of the OAS charter.
    And while I certainly hope, Mr. Chairman, in closing that, in fact, the people of Cuba will have the democratic opportunity that the rest of the countries of the hemisphere enjoy, since the Pope's departure from the island, 111 have been arrested for political crimes. Ironically, the same number of political prisoners released as a result of the Pope's request. As with laws, declarations, commitment in words mean nothing unless they are implemented.
    We hope to see those parts of the Summit's provisions implemented as well in action as they were toasted in Santiago.
    Thank you, Mr. Chairman.
    Mr. GALLEGLY. Thank you, Mr. Menendez.
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    Mr. Ballenger, do you have an opening statement?
    Mr. BALLENGER. No, sir, Mr. Chairman. I would like to say that I'm glad to welcome some old friends. It looks like we moved the old embassy from El Salvador up here to Washington. I would like to welcome these gentlemen back to the crowd up here.
    I have nothing further.
    Mr. GALLEGLY. A little safer here than it was the first time I visited El Salvador.
    Mr. BALLENGER. These fellows rode around in dangerous cars, too.
    Mr. GALLEGLY. Mr. Martinez.
    Mr. MARTINEZ. No, I have no statement, Mr. Chairman. The Ranking Member just entered; maybe he does.
    Mr. GALLEGLY. Mr. Ackerman, do you have an opening statement?
    I recognize the gentleman from the great State of New York.
    Mr. ACKERMAN. Thank you very much, Mr. Chairman.
    Today the Subcommittee meets in the wake of the Santiago Summit to review the results of that summit and to assess the state of U.S. policy toward the region.
    The beginning of any such overview usually contains an acknowledgment that 34 of the 35 countries in the hemisphere have democratically elected governments and that most of the countries in the region have embraced economic reforms leading to truly free-market capitalism throughout the hemisphere. And as you've just heard, my statement began the same way. But a closer examination of the region reveals cracks in the democratic veneer.
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    In Haiti, it is almost a year since there was a functioning government in Port-Au-Prince. Refusal by the Haitian political leadership to take responsibility for resolving the political crisis has cost them millions in international assistance and threatens the support of those of us in the Congress who have supported the role of the United States in Haiti.
    In Colombia, the political elite also seems to lack the will to create an effective strategy for dealing with the triple threat of narco-traffickers, guerillas, and paramilitaries that now threaten one of the hemisphere's oldest democracies.
    In Paraguay, divisions in the ruling Colorado party threaten the elections scheduled for next week. It is critical that the elections go ahead as scheduled, and I know that President Clinton and other leaders in the hemisphere have made this point with the president of Paraguay.
    In Peru, President Fujimoro's desire for a third term has caused him to run roughshod over opponents or institutions which might stand in his way. I took the opportunity to raise this issue directly with President Fujimoro, when I was in Peru last month, and I hope that the Administration expresses this concern as well.
    And in the region generally, the free press is under such assault that the OAS found it necessary to establish a special rapporteur for journalists in the region.
    Mr. Chairman, as the Summit Declaration makes clear, the hard work of democratization must continue. Access to education and health care, reduction of poverty, strengthening of civil society, and the reform of judicial systems across the region must be our top priority if democratic institutions are to survive both manipulation by those who would undermine democracy as well as the onslaught of crime and corruption brought by the scourge of the hemisphere, narcotics trafficking. My point here is not to say that there has not been progress. Clearly there has been. But we need to be mindful of how far we still have to go. I am pleased that the Administration has made clear in its public statements since the summit and in the testimony that I think we're going to hear today the recognition that there is still much to be done in order to consolidate democracy in the hemisphere.
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    I want to welcome Ambassador Romero and Assistant Administrator Schneider here this afternoon, and I look forward to hearing their testimony.
    Mr. GALLEGLY. I thank you.
    The gentleman from Texas, Mr. Brady, do you have any?
    Mr. BRADY. No, Mr. Chairman.
    Mr. GALLEGLY. Mr. Sanford.
    Mr. SANFORD. My only opening statement would be a round-about way of getting at a question. That is, in your testimony, I'd be especially curious to follow up on what Mr. Ackerman was suggesting, as well as with what the Chairman has suggested, which is the whole notion, whether it's in Panama, or Peru, or in Brazil the idea of changes in the constitution that allows for sort of a perennial Presidency.
    Mr. GALLEGLY. At this time, I'd like to welcome a new Member to our Subcommittee, Mr. Jim Davis from the State of Florida. I welcome you aboard, Jim, and did you have any comments you'd like to offer?
    We certainly want to welcome you to the Committee. It's a great committee, with great people, and trying to do great things.
    Mr. Smith.
    Mr. SMITH. Thank you very much, Mr. Chairman. I have no opening statement—just to welcome our two distinguished witnesses. Unfortunately, I will not be able to stay on for the whole hearing, but I would hope, Mr. Schneider, you might address the ongoing concerns that I have, as chairman of the International Operations Committee, and many Members have with the forced sterilization campaign in Peru. As you know so well, there was a letter on the day of our hearing that seemed to be forthcoming and, although then we heard interpretations may differ, that the government was not being as candid as it could have been. And perhaps you might want to comment on the progress being made to compensate those who had been victimized by the coercive sterilization campaign in Peru.
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    Thank you.
    Mr. GALLEGLY. Thank you, Chris.
    With that, let's start the hearing and I would yield to the Secretary, the Honorable Peter Romero.
    Mr. ROMERO. Thank you, Mr. Chairman, and Members and staff of the Committee.
    I thank the Subcommittee for providing me the opportunity to discuss our policy in the Western Hemisphere today, and I think we in the Administration reflect your views that there has been significant progress in the hemisphere over a host of issues over the last year in particular. But there is much work that needs to be done.
    As you know, we've just completed a very successful second Summit of the Americas in Santiago, Chile, building on the agreements reached at the first Miami Summit held in December 1994.
    The substance of the Santiago Summit reflects the fundamental principles upon which this Administration's policy toward Latin America is based: the promotion of democracy, justice, and human rights; free trade and economic integration; the eradication of poverty and discrimination; a greater commitment to and investment in education and lifelong learning; a concerted multi-lateral fight against drugs; the improvement of law enforcement; and judicial reform.
    Recent elections in the hemisphere have been among the most fair in history, and voter participation has reached unprecedented levels in some countries.
    Democratic elections and peaceful transfers of power have become the norm, and the replacement of one constitutionally elected leader by another is now commonplace in countries where it was once a remote ideal.
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    The Inter-American Commission on Human Rights has established close links with the National Human Rights Commissions in member countries, creating working groups on the rights of migrant workers and on prison conditions, and provided support for the National Committee for Truth and Justice in Haiti. All of this progress has been made hemisphere-wide with the exception of Cuba.
    The promise of economic integration. Latin America's commitment to economic integration, no less than its commitment to the strengthening of democracy, provides unprecedented opportunities to advance the welfare of our own Nation. Latin American and the Caribbean is the fastest growing market for U.S. exports, reaching $134 billion in 1997. During the last half of 1997, our exports to that region surpassed our total exports to the European Union; Mexico overtook Japan as our second largest market. Only Canada exceeds it in total volume of trade. Latin America and the Caribbean have a combined GDP of almost $1.5 trillion, nearly 500 million consumers, with a demonstrated commitment to growth, trade, and economic integration.
    There have never been more favorable conditions for the achievement of our goals in the hemisphere. The growth in U.S. trade has been the engine driving our growing prosperity and full employment. And these markets of the Western Hemisphere will be vital to the continuation of that trend.
    In Santiago, we formally launched negotiations for the establishment of a Free Trade Area of the Americas, as recommend by the hemisphere's trade ministers in San Jose, Costa Rica.
    We believe we achieved all our major objectives for comprehensive negotiations that will lead to an integrated market of over 500,000,000 consumers. Those objectives include: establishing Miami as the center for negotiations for the first 3 years of the negotiating process. This is logical. Miami is the hub for U.S. trade with the region. After that, Panama and Mexico City will be additional venues, ensuring U.S. leadership in the negotiations, with the USG co-chairing the process with Brazil during the crucial closing period of the negotiations; establishing a committee to expand the involvement of civil society groups, such as labor, environmentalists and academics in the FTAA process.
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    Followup to the agreements reached at the Summit of the Americas will be rigorous. Chile, along with the United States and Canada, as the host of the past and future summits, will form a troika to lead the implementation process.
    Possibly the greatest threat to the stability and the durability of democracy in the region already has been mentioned here, and that is illegal narcotics and all of the ills that spring from vast sums of illicit gains in the hemisphere. The scourge of illegal narcotics trade is a problem that respects no national borders. It, therefore, requires a comprehensive, international counter-drug strategy.
    In Santiago, the Summit partners launched a counter-drug strategy for the hemisphere, with agreement on a common set of standards to guide our counter-drug efforts, a coordination action plan to combat money laundering, and a convention against illicit firearms. And I'm happy to mention to the Subcommittee today that as we speak, the details and the parameters and work plans of this counter-narcotics alliance are being worked over at the OAS.
    All 34 countries of the hemisphere, except Cuba, have agreed to a common counter-drug strategy, negotiated within the OAS Inter-American Commission on Drug Abuse Control, CICAD. This is a detailed 42-point statement of common policies and commitments, accompanied by a comprehensive implementation plan. This approach is intended to cover all facets of the drug trade—reduction of cultivation, interdiction of drug traffic, demand reduction, which concerns the United States greatly, and money laundering. Reduction of cultivation relies on a combination of law enforcement and alternative development. The greatest success has been in Peru, where drug eradication efforts have disrupted the coca market. Estimates are that the Peruvian coca production has dropped by almost 40 percent in the last 2 years. Bolivia and Colombia are working on similar programs, and there has been a net reduction of at least 10 percent in coca cultivation in the Andes as a whole over the last 2 years.
    A major theme of the Santiago Summit was education. There is no more fundamental step that we can take toward the eradication of poverty than to provide our children and adults in the hemisphere with the educational tools they need for the next millennium. In Miami, we made the commitment to provide every child at least a primary education by the year 2010. In Santiago, we further committed ourselves as a hemisphere to attaining 75 percent attendance at the secondary school level. We intend to put more teachers in the classroom, improve curricula, link students to Internet, and expand vocational training.
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    Education is the linchpin upon which all other advances depend, and behind all of these things, there is approximately a $40 billion package that will be assisted by IDB, the World Bank, and, to a lesser extent, we in the Administration and USAID in particular.
    A vital area in which much work remains to be done is that of law enforcement and judicial reform. Admittedly, this facet is still a weak link. Enforcing the law is undermined if conviction and imprisonment cannot be achieved and upheld. The Santiago Summit addressed itself to this issue at length, calling for the creation of justice study centers to strengthen the fundamental appreciation for the importance of effective and independent judiciary.
    It also calls for improved extradition procedures between countries. If I might take a moment to comment on a few areas of interest.
    On Haiti, our policy is to strengthen to democratic institutions, the rule of law, basic civil liberties, and human rights; and develop an economy that will enable Haitians to prosper. Much has been achieved since October 1994; however, persistent and deep problems remain. As the Chairman mentioned, there is a political impasse in Haiti that is now 10 months old, which manifests itself in a constitutional crisis, preventing the naming of a Prime Minister and an effective government, and also blocking the flow of international assistance. It is, however, important to remain engaged. And I know all of you ask the same question, and that is, ''why should we?''
    My colleague, Mark Schneider, will talk about some of the programs that we're engaged in Haiti, but suffice it to say at this point that our programs have succeeded in large measure by essentially ending the political violence which was part and parcel of politics in Haiti; by training a new police force; by putting a lot of assistance programs in effect at the grassroots level; and by addressing what had become a growing problem, and is still a persistent problem, and that is the use of Haiti as a transit zone for counter-narcotics traffickers from the Andes.
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    As Mr. Schneider will explain, we seek the support of this Committee for increasing Fiscal Year 1999 ESF for Haiti. The increase will be targeted to secondary cities in rural areas to build democracy at the grassroots level; to improve education; encourage micro enterprise; increase assistance. It will also alleviate the pressure of the nation's poor to migrant to the United States as their preferred destination. The vast bulk of it will not go through the Government of Haiti.
    Support for the peace accords that brought an end to 36 years of civil conflict in Guatemala has been the focal point of our policy and our financial contribution to that country. The shocking recent murder of Bishop Juan Gerardi was a great tragedy, a senseless tragedy. The Government of Guatemala has announced the appointment of a special commission to oversee the investigation, and, in response to a Guatemalan Government request, the United States has dispatched a team of FBI experts to assist in the investigation.
    Our policy toward Cuba remains firm. Our goal is to promote a peaceful transition to democracy and respect for human rights. We do this through pressure on the Cuban Government through the Embargo and the Libertad Act; development of a multilateral effort to promote democracy; support for the Cuban people consistent with the 1992 Cuban Democracy Act and the Libertad Act; and enforcement of measures to keep migration safe, orderly, and legal.
    It is no understatement to say that policies of the Cuban Government were strongly criticized at the Santiago Summit. In the closing session, Brazil's President, Enrique Cardoso, eloquently called on Cuba to ''take steps toward democracy so that tomorrow that our America is one democratic country.''
    In his remarks at the conclusion of the Santiago Summit, President Clinton spoke of our commitment to strengthen our democracies, reduce trade barriers, and improve the quality of people's lives. The nations of the hemisphere must now address themselves to realizing the promise of the original commitment and to securing a second state of reforms aimed at bringing the benefits of freedom and free enterprise to ordinary citizens throughout the hemisphere.
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    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Romero appears in the appendix.]
    Mr. GALLEGLY. Thank you very much, Secretary Romero. I would advise our witnesses that their entire statements will be submitted for the record.
    Before I yield to Mr. Schneider, I'd like to welcome Steve Rothman, a good friend and, I know, a welcomed addition to our Subcommittee. Welcome aboard, Steve.
    Mr. ROTHMAN. Thank you, Mr. Chairman. It's a great honor and pleasure to serve with you and the other Members here—so many people from our districts are vitally concerned about what goes on in the Western Hemisphere as well as in Congress in general. And I'm delighted to serve with you, and look forward to learning a lot from you and the other Members and witnesses, such as those two we have, of course, today.
    Mr. GALLEGLY. It's good to have you as a new Member along with our other new Member that we introduced a few minutes ago, Mr. Davis. So with that, Mr. Schneider, we would yield to you for your testimony.
    Mr. SCHNEIDER. Thank you, Mr. Chairman and Members of the Committee.
    I appreciate the opportunity once again to describe the work that we're doing at USAID and to hear your ideas as to how we can do it better.
    In my testimony last year, I spoke about three transitions taking place in the hemisphere: from conflict to reconciliation; from dictatorship to democracy; and from protectionist closed economies to more open and more equitable economic structures.
    Two weeks ago in Santiago, as you've all noted, we really celebrated those transitions and rededicated ourselves to trying to bring the benefits to every citizen in the hemisphere. We believe that that can be done by supporting a second generation of reforms that was adopted by consensus in Santiago.
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    As you will see, that second generation responds particularly to the concerns that you've all expressed with the situation in the region. The first generation of macroeconomic reforms is now in place. It involved opening markets, privatizing state enterprises, and setting up, if you will, the environment that's led to the recovery from the decade of the 1980's. Last year produced an average 5.3 percent GDP growth in the hemisphere.
    On the political side, the first generation reforms meant establishing freely elected democratic governments as the norm in the Americas. However, second generation reforms are required to attack poverty and inequality in the hemisphere. Persistence of those threats to economic integration and to the macroeconomic reforms themselves has been recognized in the Santiago Declaration and also, and I would urge you to look at the plan of action, which was adopted by the governments, behind the declaration, calling for specific initiatives by each government to put into effect policies and programs designed to deal with these problems.
    And on the political front, the second generation reforms aim to move democratic institutions beyond the formal electoral structures, down to the community and to the individual citizen. Their aim is to ensure access to justice, to strengthen local government, and to expose corruption and fight the drug trafficking and common crime which pose threats to the security of every society.
    I think it's important to emphasize that the Santiago Summit produced a series of very concrete, specific initiatives. It launched negotiations toward a Free Trade Area for the Americas. It called for specific reforms to strengthen banking and capital markets to protect the region against the Asian financial crisis; to expand sustainable energy markets; and to further competition in the region. It strengthened efforts at establishing institutions for environmental protection.
    On the democracy side, it called for the creation of a Hemispheric Judicial Study Center, to strengthen the rule of law; to prepare a cadre of local city managers in the thousands of towns throughout the region that not only have elected mayors for the first time, but also new authority and resources to provide basic services and to emphasize new support for civic participation.
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    As my colleague noted, because of its impact on poverty reduction, its contribution to competitive economies, and its linkage to democracy, education was at the top of the Santiago agenda. A host of initiatives was adopted to improve the quality and efficiency of primary and secondary education. You have to recognize the magnitude of the problem. Half of the students who enter the first grade in Latin America today repeat that grade. On average it takes 7 years for a child to complete four grades of learning in the hemisphere. Improving the quality of education is a fundamental challenge to governments of the region.
    Eradicating poverty in the short term also requires removing the institutional barriers to the involvement of the poor in economic life. That means increasing access to credit, replacing antiquated land titling systems, and providing the physical infrastructure necessary for economic growth. The lack of infrastructure hurts the poor in two ways. First, by forcing them to live without electricity, clean water, or decent roads. And second, by deterring business from investing in their communities and making it doubly difficult for their micro enterprises to succeed. Eradicating poverty also is made more difficult by natural catastrophes such as El Nino, which almost invariably affects the poor disproportionately.
    In each of these areas, in Santiago initiatives were adopted, and our USAID programs and our proposal to you this year, provides specific support to each of those. For example, we anticipate reaching an additional 250,000 micro entrepreneurs with credit and technical assistance this year through groups affiliated with NGO partners, such as Accion International and FINCA.
    The second major challenge to the transition just after poverty is the threat from drug production, trafficking, and consumption. In Santiago, our concerns were mirrored in the commitment to a multilateral alliance against drug trafficking. USAID will play our part to strengthen justice systems and educate citizens to the dangers of drugs; and thereby complement law enforcement work.
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    But perhaps the most critical assistance we provide is offering environmentally sound, economically sustainable alternatives to illegal drug production.
    In Peru, that combination has helped, as you've heard, to produce a reduction of 40 percent in coca cultivation during the past 2 years. It's involved our signing up, and I mean signing up, whole communities who agree to eradicate coca in exchange for alternative development in which the farmers not only have alternative crops, but the community receives basic infrastructure support.
    In Bolivia, that same effort has resulted in licit crops in the Chapara now being three times the area devoted to illegal coca cultivation.
    With respect to Haiti, we all know that a political stalemate has delayed privatization, impeded parliamentary approval of reform legislation, and thereby stalled disbursement of $120 million in donor budget support and $60 million of pending project loans before the parliament, and at least another $200 million in EFE infrastructure loans in the pipeline. The failure has meant that the Haitian Government is unable to spend at planned levels for health, education, and basic services. The results involve widespread discontent, frustration, and social tension. In part, for those reasons, we've requested a doubling of the $70 million in ESF funding for Fiscal Year 1998 to $140 million in Fiscal Year 1999. We believe that those funds will permit during this period of stalemate an extension of additional health, education, and humanitarian services, largely delivered through non-governmental organizations.
    More fundamentally, it will direct the majority of those resources to the secondary cities and market towns outside Port-au-Prince, to take advantage of development opportunities, which we know exist, to build grassroots democracy and rural economic growth in those communities, where you've got new mayors elected for the first time; and we now know that we can develop economic opportunities in those areas that do produce results; and in that process, reduce the pressures driving the exodus from the rural areas to Port Au Prince, and obviously beyond.
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    I think my colleague has noted that there have been important positive developments. Political violence is at its lowest point in decades. There is unrestricted freedom of expression in the press in Haiti. The parliament is functioning, sometimes too well as a powerful counterweight to the executive branch. Local government, with elected mayors constitutes a clear step forward. And USAID programs have helped to support association of mayors throughout the country.     The Haitian national civilian police is barely 3 years old, but it is establishing itself as an increasingly effective civilian force.
    Granted that much remains to be done. Economically, Haiti has reduced inflation from 37 percent in 1994 to 17 percent in 1997. The first privatization, long delayed, finally took place through an open competitive process, and our programs are promoting continuation of that effort.
    The bulk of our assistance goes to the two-thirds of the Haitian population living in poverty. Our agricultural programs are helping to improve farm practices and raise farm incomes in project areas reaching 175,000 farm families. That's about 750,000 people. And it has increased production and income by 20 percent to 30 percent in those areas.
    In the health area, we reach 2.3 million people, basically the poorest of Haiti's citizens, with primary health care services through NGO clinics. Infant mortality has dropped by 25 percent in those project areas. We've trained some 7,000 private and public primary school teachers and administrators and continue to provide food to 800,000 of Haiti's poorest citizens through either school- or community-based feeding programs.
    Overall, the Administration has requested a total of $657,000,000 for foreign economic aid to be managed by USAID in the Americas. It's an increase over the levels available to us in the current Fiscal Year. Where do those resources go?
    First, to consolidate peace, democracy, and poverty reduction in Central America; to respond to humanitarian needs and development opportunities in Haiti; to offer support for anti-poverty, alternative development and democracy programs in the Andean countries, all of which contribute to the counter-narcotics strategy; to increase partnerships on global issues with Brazil and Mexico; to help the Caribbean countries address economic diversification, environmental protection, and democratic institution building. Let me also mention our work under the Libertad Act, which supports the peaceful transition to democracy and economic freedom in Cuba. Our objectives are to improve outreach to the Cuban people, promote human rights, and stimulate multilateral efforts for democracy.
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    The total budget request for $657,000,000 for foreign aid has to be placed in context. It clearly represents a significant reduction from the $1.6 billion level funding of a few years ago. Nevertheless, it does constitute an increase over last year's request, both in terms of development assistance and ESF, and a slight increase over the appropriated level of funding for this Fiscal Year.
    As you know, we're proposing in that a $20 million Presidential Summit Initiative to complement our program in the areas of basic education, micro finance, and working with Central America on the implementation of the free trade area.
    We believe that these activities directly contribute to U.S. foreign policy objectives, and to realizing the shared vision for the hemisphere, ratified by the Summit of the Americas.
    I urge the Committee's continued support. This panel has been a particular friend of our program and a supporter of our work. And I'm pleased that we've had a bipartisan consensus over recent years in supporting those efforts.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Schneider appears in the appendix.]
    Mr. GALLEGLY. Thank you, Mr. Schneider.
    Mr. Romero, as I said in my opening comment, I had some concern, and I think it's shared by many on this Committee and beyond—the number of former military strongmen that are getting involved in the Presidential process—maybe you could give us a little assessment of how you see the state of democracy in Latin America, and the effect and the role of the former military folks getting involved.
    Mr. ROMERO. I think the two cases that come most readily to mind are the Presidential candidate in Venezuela called Hugo Chavez who led an unsuccessful coup against the democratic government there several years ago and another general, Lino Oviedo, who, again, led an unsuccessful coup in Paraguay. And I think that when you look at it, it does remind us of the days when military strongmen occupied Presidential palaces in Latin America. Those days are behind us, but these people do have, unless the courts, of course, rule otherwise, the right to run for office. And in the case of Venezuela, Hugo Chavez has been cleared to run for President. In the case of Paraguay, interestingly enough, the supreme court ruled, when we were down in Santiago and meeting with the Paraguayan President—the Secretary and myself—that Lino Oviedo was not permitted to run; that, indeed, the charges against him by a lower military tribunal would stick. And they upheld a sentence of 10 years in jail. I think the bottom line is that democratic institutions, particularly the courts need to work and, in these cases, at least the courts have spoken.
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    Mr. GALLEGLY. A couple of weeks ago, I met with the ambassador from Venezuela, and we were discussing, of course, the U.S.-Venezuelan relationship. And the discussion turned to what was happening along their border with Colombia. I think we all like to think we've made significant progress in dealing with the drug lords and the guerillas in Colombia, certainly I think most of us would also agree that we still have a long way to go. But we have made progress.
    But it appears that the overwhelming support of the Colombian Government is focusing on protecting the major cities in Colombia rather than their border with Venezuela. The Venezuelan Government has made requests of our State Department to help in providing hardware—radar systems, communications equipment, et cetera, et cetera—to help deal with that problems themselves, since they can't really rely on Colombia.
    They expressed frustration that to date, they have not had any real success in working with the State Department and getting a direct response to those requests. Are you aware of those requests and how are we progressing?
    Mr. ROMERO. Mr. Chairman, I was down there about 3 or 4 months ago and spoke to the commander in charge of the military zone, which includes the whole border, or at least the northern and central portions of the border with Colombia. And I put the same question to him that you're putting to me and that is, ''what do you need?'' We understand that there's a bad problem with lawlessness in Colombia; that it is increasingly spilling over into Venezuela; that we would like to do what we can to provide the kinds of assistance and training necessary to help you contain it. We just need to know what you need.
    And, in fact, after my visit down there, I spoke to our Commander-in-Chief of the Southern Command, General Charles Wilhelm—who has dispatched a group of people down there to talk to them. I think they've beefed up their forces on the border. It's an incredibly long border, and their forces are really dispersed. They don't have the mobility that they need to get around to confront the threat, and I can assure you that we'll continue to work with them. We are essentially waiting on our assessment teams and what they say.
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    Mr. GALLEGLY. Well, I think it's important because what you have said today is somewhat in conflict with what the Ambassador was conveying to us because they were very specific in mentioning radar equipment, surveillance, and communications equipment. They weren't asking for B–2 bombers and a battalion of marines. They were asking for very specifically some hardware in the area of radar and communications, so perhaps we could talk a little more specifically; and if we can get that to the State Department, perhaps we can speed up the process a little bit.
    Mr. ROMERO. This was the Venezuelan ambassador here in Washington? OK, that's fine. I'd be happy to meet with him, and we'll see what we can do.
    Mr. GALLEGLY. Very good. Thank you very much, Mr. Romero.
    Mr. Ackerman.
    Mr. ACKERMAN. Thank you very much. First a question for Mr. Schneider. You spent an interesting part of your time talking about Haiti. And, indeed, the request you make for additional assistance for Haiti, $70 million, is I guess the largest increase that we see—I guess double what it was last year. Some might argue that if we got double or even triple the results we got last year that it would probably not be a good return.
    Tell us why we should be doing this, and as well as maybe address the aspect of the privatization projects that are going on.
    Mr. SCHNEIDER. Thank you. I tried to emphasize that we have seen significant results, such as reducing infant mortality by 20 percent. We've reduced severe malnutrition in the areas that we've been working by nearly 30 percent, and that saves lives. But, unfortunately, we are not reaching all of the people who need them. Part of the increase, about $22 million of the increase, would go directly to increasing access to those services around the country, particularly at a point when the government can't expand its services.
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    The second is that we now know that in some of those areas outside Port-au-Prince, you've got young mayors who've been elected for the first time who are not depending on the national government and can, in fact, do things locally. And we've seen in some of the places a combination of working with the local governments, strengthening them, and with small farmers in the area can produce results. And finally, we are worried about the situation, as you've noted, in terms of the stalemate having an impact on an already very, very frustrated people, people who are living in the country with the lowest per capita income in the hemisphere. And during this time, we think that this is a moment when we, in a sense, have to provide some bridge; and therefore, there's a request for the increase to help stabilize the situation during this time period. And hopefully that political stalemate will be resolved. I should add that one of the areas that we would be working in would be to strengthen at the local level some of the police and justice operations there, outside Port-au-Prince.
    Mr. ACKERMAN. If Congress were to deny your request for Haiti in specific terms, and nonetheless give you $70 million bucks, what would your top three priorities be?
    Mr. ROMERO. Should we talk about this first?
    Mr. SCHNEIDER. Let's say that you didn't deny the $70 million, but you found that it was reasonable in terms of the needs of the hemisphere to increase our funding by $70 million.
    I think that we'd all agree in looking at what we've described coming out of the Summit, there are areas where there are additional needs in the hemisphere. In terms of democratic strengthening the rule of law, clearly there's a need for additional resources in the area of local government as well. On the side, the economic side, poverty reduction, there are things in micro enterprise, land titling, and basic education where we could provide additional services.
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    But, I would emphasize, in the countries where transitions are taking place—transitions from conflict to peace in Central America, transitions from a situation where the drug trafficking has disrupted lives in the Andean countries and Colombia. And I would also add that, given the situation in the Caribbean, that would be the third area where I would look to for trying to increase our programs. In addition, of course, to the additional resources in Haiti.
    Mr. ACKERMAN. Mr. Romero.
    Mr. ROMERO. Thank you, Mr. Ackerman.
    Might I just add to what my colleague mentioned and that is that alternative development in Bolivia and Peru would be high up on that list. We're on a roll right now in those two countries.
    Mr. ACKERMAN. Let me follow up with a question for Mr. Romero, if I might, Mr. Chairman.
    You mentioned in your statement and briefly touched upon in your remarks the concept of a multilateral evaluation mechanism for counter-narcotics. Maybe you could expand a little bit upon that. Tell us why you think Latin American Governments will agree to this approach, and is this approach intended to replace the certification statute?
    Mr. ROMERO. Let me first start out by saying what it's not. And it will not replace certification. That is the prerogative of Congress. It is the law. If any changes are made, it will be done by Congress. We do not anticipate bringing to you any changes as they come out of this process.
    What it is, is an alliance, by hemispheric countries, that is under the recognition, the keen recognition, that our individual and even bilateral efforts on counter-narcotics, with all of its attendant ills, will not work unless we all come together under a counter-narcotics strategy for the hemisphere. That counter-narcotics strategy is done. It's modeled after the 1988 U.N. Convention on Narcotics. We want to translate that into an action. And essentially, what our delegates and the rest of the hemisphere are doing right now, as we meet, is to talk about the modalities. What we want to see come out of this—and there is great consensus on this—is a strengthening of national strategies to confront the phenomenon; a creation, in many cases, of better regional strategies of cooperation. Our bilateral approach hasn't really gotten us to a point where we've seen a lot of regional—as much as we should—regional cooperation. And, then, essentially through the good offices, probably in the OAS, of providing the kind of input on all of the arcane issues related to money laundering and the introduction of precursor chemicals, and transit and production, alternative development, demand, et cetera, consumption. And then what we hope to create is a unique entity which would evaluate and monitor over a continual period of time a country's progress on counter-narcotics, and to make reports on that progress.
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    The United States have been obviously willing to throw itself into the universe with the other countries in the hemisphere that will be monitored and evaluated. We believe very strongly that if there's going to be this kind of cooperation, we have to be on a plane with the other nations of the hemisphere.
    Mr. ACKERMAN. Thank you. Had the Chairman put the timer on, I think my 5 minutes would just about be up, so I'll——
    Mr. GALLEGLY. As you know, I was going to say——
    Mr. ACKERMAN. You're most generous——
    Mr. GALLEGLY. —Mr. Ackerman——
    Mr. ACKERMAN. I'll yield the remaining 6 minutes of my time.
    Mr. GALLEGLY. As my good friend, the Ranking Member of the Subcommittee, the gentleman from New York, knows I'm a far more liberal person than he is, as evidenced by his conservative cross examination of Mr. Schneider. And with that I would yield to the gentleman from North Carolina, Mr. Ballenger, for such time as he may consume.
    Mr. BALLENGER. Thank you, Mr. Chairman.
    Mr. GALLEGLY. But as long as it's under 5 minutes.
    Mr. BALLENGER. Mr. Schneider, I'd like to ask you a question because I come from the area of the United States that invests heavily in furniture. I have worked with the Talaveras Group in northern Nicaragua, Chinandega area, about the idea of possibly working out an arrangement to cut the expensive woods like mahogany and transplant at the same time. This is the same program I was talking about in Haiti—plant trees as we cut trees. And then Mr. Aleman actually put a freeze on cutting trees for the next 5 years—valuable trees like cedar and mahogany. As I understand it, the natives found that the trees have no value because we can't cut them, so the best thing we can do is burn them down and use the ashes. As far as I am concerned, this is an economic disaster.
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    In other words, it's having exactly the opposite effect that Mr. Aleman wanted. Is there anything we can do to help President Aleman, or do something to persuade him that his trees are very valuable? In North Carolina, he can get a ton of money for them, and we'd be glad to help him replant the trees if he'd like to do that.
    Mr. SCHNEIDER. There's no question that we will engage with the Nicaraguans on that issue. We're working with them on the Bosawas National Reserve and talking with them about how to provide for, in a sense, sustainable agriculture, but sustainable forestry; that is, looking at this as a valuable resource, but one which has to be obviously maintained and preserved in an appropriate way, and that includes appropriate cutting and replanting. And so I'd be happy to provide some contact for you.
    Mr. BALLENGER. Well, I'd appreciate it——
    Mr. SCHNEIDER. And also I should say that there are some programs where we're working with them now in other parts of Nicaragua where we're doing just that. And that's what we're doing in many of the countries in the hemisphere as part of the environmental program. I visited a program in the Amazon, in Brazil, where they had, in an area of several thousand acres, they had actually numbered each tree. And they knew which ones were going to be cut, and which ones were not—obviously in terms of preserving the environmental sustainability of that area.
    Mr. BALLENGER. Well, if you do it, I'd greatly appreciate it. And I'd like to help in any way I can.
    Mr. Romero, Congressman Ackerman and I were in Colombia, and a month or two before that I was in Venezuela. In each country, I stated, ''You know, with all this drug stuff that everybody's talking about here, you've got to have somebody that's laundering the money. How's it working?'' And they named immediately, without any suggestion on anybody's part, a family in Aruba named Mansur who are very high ranking money launderers for the drug trade. And everybody knows it, and yet nobody does anything. Is it illegal for us to do anything? It's a Dutch island, I know that. But does that stop us?
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    Mr. ROMERO. Mr. Ballenger, I think that we've had an outstanding extradition request for the Mansur brothers—there are two brothers that we are concerned about now—for several months if not a year. We're trying to get them to stand trial in the United States. We've known about their activities for many, many years, and we've been working with the authorities down in Aruba to get that to happen. And we see some progress being made, but it's been painfully slow, because, to be quite honest with you, they've got a painfully torturous judicial process as it relates to extradition, but also these people are well-known, and well-heeled, and well-connected.
    Mr. BALLENGER. Again, when Congressman Ackerman and I were in Panama, we landed at our base there and they discussed the idea that we were going to try to set up a counter-narcotics drug education center for the whole Western Hemisphere. It somehow got caught up in Presidential politics in Panama. Has anything positive occurred along those lines, or is it still hung up by elections?
    Mr. ROMERO. Our representative, Ambassador McNamara, is meeting with the Panamanians right now, and we hope to unravel a lot of this. Secretary Albright met foreign Minister Arias down in Santiago, and they had a very lengthy chat about this issue. You're exactly right. We thought we had agreement twice, only to have complete rewrites of text, or to pull back the previous text, or to say that another layer, a multilateral layer, needs to be addressed, et cetera. Seventy percent of the Panamanian people support the creation of an MCC down there, primarily manned by U.S. Air Force personnel. But it's a problem within the ruling party, the PRD. And I think if it's going to work, it's going to require some leadership on the part of President Perez Balladare.
    Mr. BALLENGER. Mr. Schneider, it is my understanding in listening to your statement that because of the lack of a democratic government in Haiti, that $120 million of our money was hung up?
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    Mr. SCHNEIDER. Not our money. Other donors' budget support money, which had been committed under the economic support program agreed to between Haiti and the IMF. And these countries have committed essentially $120 million to support increased budget expenditures by the government, assuming they approved a series of reforms; and approved the budget for that purpose. And that would have meant the ability of the government to increase health and education expenditures and infrastructure investments. And because of this stalemate—the lack of a government, the lack of this legislation—that $120 million has been hung up.
    Mr. BALLENGER. Well, let me ask you a question. They were smart enough to put strings on their money. Were we smart enough to tie up any of our money?
    Mr. SCHNEIDER. Sure, I mean, we held up for a significant amount of time our budget support.
    Mr. BALLENGER. Are we still holding up some?
    Mr. SCHNEIDER. We still have about $5 million in budget support that's being held up. The difference is that that money would go to the government. Most of the other resources that we have goes directly to NGO's providing services or to local governments. And we basically have indicated the reasons why we think those programs are important to continue. And if you think about what would happen without those programs, you know Haiti.
    Mr. BALLENGER. Thank you, Mr. Chairman.
    Mr. GALLEGLY. Mr. Menendez.
    Mr. MENENDEZ. Thank you, Mr. Chairman.
    Ambassador Romero, let me just first of all say, you know my personal admiration for your professionalism and your work, and I'm very happy to be one of the individuals to introduce you to the Senate Foreign Relations Committee when you were our Ambassador to Ecuador, so I hope you won't take anything that I'm about to say personally.
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    Mr. ROMERO. Thanks for the warning.
    Mr. MENENDEZ. But, well, due process is warning and an opportunity to be heard. I read your statement, and I heard you utter it. To me, it is inconceivable that the Administration's review speaks about the Summit reflecting the fundamental principles on which the Administration's policy toward Latin America is based, and it starts off with ''the promotion of democracy, justice, and human rights.'' And that when the champagne was finished and the bottles were empty, that at the end of the day, eight out of ten countries in Latin America did not vote with us at the U.N. Commission on Human Rights. You had no China resolution for the first time this year. The only resolution of any real significant value that I can see was the Cuba resolution. And the host country, Chile, which in the past had voted differently, moved their vote away.
    Now, how am I to believe that the President was lobbying at the same time on behalf of our efforts, which, regardless of your views about our policy, there's no one I think who disputes that there are human rights violations in Cuba. How is that possible and reconcilable as well as with the OAS position and report? I mean, what happened? How is it humanly possible that we were doing all of this, and a week later, after having visited the two areas of the world that have the greatest number of people on the Human Rights Commission, the African continent, and as well as all of our hemispheric partners—and we had all of those countries——
    Mr. ROMERO. Well, first of all, let me just tell you that we were deeply disappointed at the vote. Our spokesperson, James Rubin, is on record as having said, in uncharacteristically strong language for a press statement, that we have deep concern that some delegations at the U.N. Human Rights Session, who have the obligation to promote and protect human rights and fundamental freedoms have chosen to turn their backs on the suffering of the Cuban people. It is unconscionable that the vote in Geneva will end the mandate of the special rapporteur. History, however, will not absolve the Cuban Government, and the people of Cuba will live in freedom.
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    We were, in the words of Assistant Secretary Davidow, deceived in many cases by members in Geneva representing governments who told us they would vote one way and then in the end voted differently. When you talk about the President's travel to Africa, and you look at the voting, the five African countries that switched their votes from last year, and that is from an abstention to an outright no, which really carried the balance here, were Cape Verde, Guinea, Mali, Mozambique, and Madagascar—none of which were visited by the President.
    Mr. MENENDEZ. South Africa voted no, did it not?
    Mr. ROMERO. They did not change their vote, though. I'm talking about people who——
    Mr. MENENDEZ. And they talked about democracy.
    Mr. ROMERO. And they talked about Cuba, and what they talked about became very public. And I think everyone in the room, if they haven't heard, can easily find out what Nelson Mandela said about——
    Mr. MENENDEZ. You're telling me that eight out of ten countries in Latin America, that you all met with, that you all signed declarations with, that you all had very close opportunities, from the President to the Secretary of State, and all of the other personnel, that it backed out that whole process? None of those countries could be convinced, and they were actually changing their votes? I mean, I don't want to belabor the point. It is inconceivable to anyone to believe that after having such a high profile display of democracy, human rights, to then go to the only country in the hemisphere that clearly violates human rights; that has arrested 110 people since the Pope left; and to have that type of vote that we worked this in the type of way that we would have if we were serious about having passed a resolution.
    Having said that, you know, it's hard for us to believe. Having said that, let me ask you quickly about three countries—other countries in the hemisphere.
    I have listened to a series of U.S. businesses about the Dominican Republic, who talk about violations of their contracts—recently a military confiscation of property—and great difficulties with transparency in terms of contracts. Have you had any sense of that?
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    Second, on Nicaragua, where is our status on waiver and property confiscation? The reality is I have continuously heard from U.S. interests that still have not had their property claims resolved, and that I think the Nicaraguan Government has come to believe that we will issue this waiver by virtue of a pro forma aspect. And I think that that has become very dangerous in terms of our dealings.
    And last, to Mr. Schneider, as I get all my questions, then I'll listen to your answers. Last time I checked, 50 percent of the southern hemisphere was still below the poverty level. Haiti didn't equal Latin America. Nineteen percent increase in your budget—something that the Congressional Hispanic Caucus lobbied the Administration for. And then, when we do a little digging, we see that of that, 17 percent goes to Haiti, 2 percent goes for the rest of the hemisphere. That's not quite what we were talking about in terms of engaging Latin America.
    I don't understand how a budget, with whatever Haiti's needs are, how a budget with the rest of the hemisphere, with economic integration, with everything else we heard about at the Summit, can possibly be fulfilled. And I will tell you now that the Caucus is deceived in terms of what it believed what this increase was for. When we met with Frank Raines and the budget office and lobbied on behalf of having the Latin America division have greater aid, it was not to give 17 percent to Haiti.
    Thank you.
    Mr. GALLEGLY. Mr. Menendez, you've set a new record for protocol here. I think maybe we could all learn that if you ask 6 minutes worth of questions——
    Mr. MENENDEZ. Maybe the answers will be short.
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    Mr. GALLEGLY. Yes-or-no answers.
    Why don't I give my colleague a chance to respond here—a chance to think about his response.
    Mr. SCHNEIDER. I think in terms of the overall—if you take out the increase for Haiti—there is still an increase in the funding requested for the rest of the hemisphere for development assistance. It was about $24 million over our request a year ago. And it includes this year $20 million for the Presidential Initiative on the Summit, and approximately $5 million net increase over the appropriations last year for development assistance; that is, the appropriated funds are about $294 million, and we've requested $298 million.
    You're correct in terms of the area of ESF—about $72 million is for Haiti. And I tried to explain the Administration's rationale for the increase in Haiti. I am never one to argue against the need for additional resources for the rest of the countries in Latin America. I strongly believe that that's an area of utmost importance to the U.S. national interests. And we've attempted this year, given the restrictions, still to request some increase in the development assistance program.
    You're also correct that the level of poverty in the rest of the hemisphere is still a considerable amount—about 35 to 38 percent. But it's still unacceptable, and clearly given the levels of GDP, that there should be much more done with respect to the poverty problem in the hemisphere.
    Mr. ROMERO. Congressman Menendez, on the Dominican Republic, I'm not aware of specific cases other than a large case of U.S. companies that are generating electricity on the island and have had their electricity or energy installations briefly occupied by the military; have had their contract negotiations in dispute for some time; have had arrearages in being paid, et cetera. And some of those arrearages persist.
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    But if you have any particular cases, I'd be happy to bring it to the attention of our chargé.
    On Nicaragua, we continue to see an adjudication and flow through of outstanding U.S. citizen claims, property claims, moving at a pretty good rate. There have been, as you know, an expansion of the universe of those claimants. We've got almost 3,000 U.S. citizen claimants of which there are about 128,000 beneficiaries. That universe continues to expand, although the expansion has slowed recently. They've adjudicated through the years about two-thirds of these cases. I will check to make sure that that rate is continuing. The Secretary provided them a waiver in July 1997. I think we need to do it again, if we consider that step this year, in July 1998. This would be an opportune moment to look into it.
    Mr. SCHNEIDER. Could I just add one thing. We've recently had a consultative group meeting of donors—of all the donors—looking at the Nicaraguan—essentially development plan for the next 4 years. And at that meeting, we raised the property issue. Not only the U.S. Government, in terms of U.S. citizens, but the entire donor community raised it as an issue for confidence of international investors in the respect for property. And it was raised to the Minister of Finance in Nicaragua at that session and was emphasized that this is an issue that is important in terms of Nicaragua's ability to obtain additional investment from the international community.
    I will say that this year my understanding is that there have been another 56 claims resolved in the first several months. But clearly, that's an issue that has to continue to be pressed.
    Mr. MENENDEZ. Well, I won't delay the Chair, but I would just say that, when I asked Hamilton of the Department recently, that he didn't know if he could be one to be recommending the waiver unless things are dramatically changed, and from what we hear of U.S. citizens, and on the Dominican side, any time troops take over U.S. property abroad, I would go on.
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    Thank you.
    Mr. GALLEGLY. Thank you, Mr. Menendez. Mr. Brady, do you have any questions?
    Mr. BRADY. Yes, Mr. Chairman.
    Mr. GALLEGLY. We do have a vote on, and we'll try to wrap up so we don't have to hold you folks over.
    Mr. BRADY. I'll be very brief.
    On a recent Friday in Guatemala, Bishop Juan Gerardi released a report after years of hard work—four volumes—that outlined personal eyewitness testimonies of human rights violations in Guatemala. That Sunday night, he was brutally murdered outside his residence. It would stretch credibility. It's shocking enough that he would be murdered. It just stretches credibility that is a random act of violence.
    I understand that a suspect has been arrested and arraigned, but the question the investigation ought not just be who conducted the murder, but on whose behalf. And my question to you is, what are we doing? And what can we do to help Guatemala get to the truth and what lies beyond the truth in that murder?
    Mr. ROMERO. Congressman Brady, we too are extremely concerned about this. The bishop was not just the head of his flock and the clergy down there, but was a renowned and eloquent spokesperson for the peace process down there who had just, as you mentioned, published an historical record of the violence that went on during the worst part of the disorder down there, the conflict.
    In the wake of what happened last weekend, what we are doing is we have sent three FBI agents down there that are looking at the crime scene, trying to get the Guatemalans to follow up on leads; doing technical kinds of analysis, and that sort of thing.
    In addition to that, the Guatemalan Government has set up a commission and invited three members of the church to sit on that commission to kind of oversee the investigation. The investigation will be led by the Minister of Interior Mendosa, along with the chief of police; and our every hope is that they investigate this fully and completely and bring those responsible to justice.
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    Mr. BRADY. Yes, Mr. Schneider.
    Mr. SCHNEIDER. If I could just add, Bishop Gerardi was somebody that we all knew personally. He was one of the strongest advocates for human rights and for reconciliation in that country. And his murder has resulted in a national outcry in Guatemala which has brought every party, every sector of society together to make the same demand that you've made: that not only the specific individuals, but whoever was involved beyond that, be brought to justice.
    In addition to the FBI, we've also worked through ICITAP in providing training to the public ministry and the police in Guatemala. And we are, again, working with their major crimes unit to focus on this, and to use all resources available. And the Ambassador said, if there are any resources that, in the course of the investigation, they need, that we will respond.
    Mr. BRADY. Well, I would just point out that we are later today introducing a resolution which we expect to pass both Houses expressing obviously our sorrow and our outrage over the murder and calling upon America to use all its resources. And my question to either of you is the composition of the Guatemalan commission such that it will likely get to the truth in the murder?
    Mr. ROMERO. I think that's our every hope, Congressman Brady. The jury is still out. We'll see.
    Mr. BRADY. Thanks.
    Mr. GALLEGLY. I'd like to compliment our friend from Texas, Congressman Brady, for his leadership on this resolution, and I think it speaks for both bodies and for the American people.
    I have just one quick followup question for you, Mr. Schneider. We do have a vote on, and we're going to run. But this is something that I wanted to ask earlier, and I want to make sure that all our colleagues had an opportunity to ask questions. But the seaport operations in Haiti can be characterized not only as terribly inefficient but also quite corrupt. I also understand that at least 80 percent of the Haitian imports are smuggled into the country without paying any or little at best, import taxes. Can you tell the Committee very quickly, why U.S. taxpayers should be asked to foot another $70-million increase in aid to Haiti, when the Haitian Government itself won't even make an attempt to collect probably the simplest form of tax that they have available to them?
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    Mr. SCHNEIDER. I hope that I've explained it in terms of our interests. In terms of the problem of the ports, what we're doing is we're pressing it, and right now we're about, I say, halfway through the process of moving to privatize those ports around the country, not just in Port-au-Prince.
    Second, is that we're moving with a program that we're funding U.S. Customs Service to go in and help right now try and get a hold of that corruption problem, which clearly exists and has continued to be a problem for a whole range of reasons, not merely the question of tax revenues, but on the question of drugs and every other kind of smuggling. So we share your view——
    Mr. GALLEGLY. You do understand that it is a very hard sell for a country to ask for millions of dollars of aid, when they don't even have the willingness to help themselves?
    Mr. SCHNEIDER. Understood. Understood. Can I just add one thing? Congressman Smith raised a question about Peru and the sterilization issue. All of the things that were promised by the ministry in his hearing in terms of an end to campaigns, an informed consent process, a 72-hour waiting period. I went to Peru after the hearing and can assure the Committee that those things are being put into place; and the campaigns have ended. And we're funding the ombudsmen and external investigating groups to deal with those problems of abuse that have been alleged.
    Mr. GALLEGLY. I'm sure that Mr. Smith will be happy to hear that, along with the rest of the Members of the Committee.
    I want to thank both of you gentlemen for your testimony today. I thank all my colleagues for being here. Thank you, Mr. Menendez.
    Mr. MENENDEZ. Thank you, Mr. Chairman.
    Mr. GALLEGLY. Mr. Brady. And with that, the Subcommittee stands adjourned.
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    [Whereupon, at 3:05 p.m., the Committee adjourned subject to the call of the Chair.]


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