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50–537 CC








MAY 7, 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 O. GRAHAM, South Carolina
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ROY BLUNT, Missouri
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
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RICHARD J. GARON, Chief of Staff
MICHAEL H. VAN DUSEN, Democratic Chief of Staff

Subcommittee on Asia and the Pacific
DOUG BEREUTER, Nebraska, Chairman
JAY KIM, California
JON FOX, Pennsylvania
JOHN M. McHUGH, New York
EDWARD R. ROYCE, California
HOWARD L. BERMAN, California
LOIS CAPPS, California
MIKE ENNIS, Subcommittee Staff Director
RICHARD KESSLER, Democratic Professional Staff Member
DAN MARTZ, Counsel
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HEIDI L. HENNIG, Staff Associate


    The Honorable Stanley O. Roth, Assistant Secretary for East Asian and Pacific Affairs, U.S. State Department
    The Honorable Walter B. Slocombe, Under Secretary, U.S. Department of Defense
    Admiral Joseph W. Prueher, Commander in Chief, U.S. Pacific Command
Prepared statements:
The Honorable Stanley O. Roth
The Honorable Walter B. Slocombe
Admiral Joseph W. Prueher
Additional material submitted for the record:
Questions for the record submitted to Assistant Secretary Stanley O. Roth by Congressman Rohrabacher
Questions for the record submitted to the Honorable Walter B. Slocombe by Congressman Rohrabacher (Answers are classified and are on file at the Committee on International Relations—available to those with appropriate clearance)

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House of Representatives,
Subcommittee on Asia and the Pacific,
Committee on International Relations,
Washington, DC.
    The Committee met, pursuant to notice, at 2:08 p.m., in room 2172, Rayburn House Office Building, Hon. Doug Bereuter (chairman of the Committee) presiding.
    Mr. BEREUTER. [presiding] The Asia Pacific Subcommittee will come to order.
    Because of the debate on the House floor on the annual intelligence authorization legislation, I regret to say that I was delayed in coming here to proceed with the markup of two resolutions, one on Japan, one of the Philippines, which are deemed to be non-controversial. But I think in light of the fact that our distinguished witnesses are here—we expected to begin at 2 p.m. that part of our hearing—I would ask unanimous consent that the markup of those two resolutions be delayed until the completion of the hearing scheduled for this date.
    Is there discussion or objection to the unanimous consent request?
    Hearing none, that will be the order. We will proceed directly to the hearing scheduled for today. And the Subcommittee on Asia and the Pacific does meet today to focus on the topic of U.S. security interests in Asia.
    Soon after I assumed the chairmanship of the Subcommittee, I tried to establish a set of basic guidelines, which I thought would apply and should apply to the Subcommittee's oversight. In establishing those guidelines, my goal was for them to reflect America's vital and growing interests in Asia and to provide greater assurance of continuity to American engagement in the region.
    The first immutable principle that I identified was the advancement of U.S. security interests in the region, ensuring the United States remained engaged, committed to peace, and dedicated to strengthening our alliance and friendships in the region.
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    Historically and geographically, the United States has strong links with Asia, and, as a result, we have a fundamental interest in the peace and security of the region. Moreover, the nations of Asia have reciprocated by demonstrating a fundamental interest in keeping the United States militarily engaged in the region.
    It's readily apparent that every nation in Asia, with the possible exception of North Korea, and, yes, even China, wants us to remain militarily engaged in the region. It's also, I think, important to reassure our Asian friends of our long-term commitment. It seems we can't do that enough.
    Based on this observation, I introduced a resolution last year, along with Chairman Spence of the National Security Committee and many Members on both sides of the aisle, calling for the Clinton Administration and its successor to maintain approximately 100,000 U.S. military personnel in the Asia-Pacific region. And that was well received by the Administration because it was their policy, as it had been the policy of their predecessor Administration. I believe this initiative was well received, for it became a part of the House defense authorization bill. I'll be interested to hear from our Department of Defense witnesses how this policy language is being implemented.
    Certainly, as one surveys the landscape, there is no shortage of security concerns in the region. Some of the major considerations include the following: the threat posed by North Korea's huge military and nuclear weapons potential to South Korea and the entire northeast Asia region.
    Second, reports that China continues to supply missile and nuclear and chemical technology to other countries—inconsistent with non-proliferation goals—particularly to Pakistan and Iran.
    Third, revision of our longstanding security alliance with Japan, our most important military ally in the region, and our sometimes prickly relationships with the people of Okinawa, where so many of our forces are located.
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    Next, claims of sovereignty over the scattered territories of the South and East China Sea, including the Spratley Islands, which directly involve China, Vietnam, Brunei, Malaysia, the Philippines, and Taiwan, as well as the islands which involve China, Japan, and Taiwan. The seemingly ever present tension between mainland China and Taiwan, most recently reflected in the 1996 Taiwan Strait Crisis, the recent instability in Indonesia, both economically and politically, and a restructuring of our security relationships with Thailand, the Philippines and Singapore.
    I make no apologies for being a strong advocate of enhanced military-to-military cooperation in relationships. I think such conduct and contact can go a long way toward alleviating unnecessary misunderstandings.
    The training and education programs that the United States offers dramatically improves the professionalism of the armed forces of our friends and allies. Admittedly, there's an occasional bad apple whose participation in U.S. training may prove an embarrassment. But my sense is that the overwhelming majority of those who receive military education and training return to their homelands as better, more responsible officers or non-commissioned officers.
    Certainly, the IMET program and the Joint Combined Exchange Training (J–CET) programs have come under heavy scrutiny in recent weeks. In particular, many in Congress were surprised to find that Indonesia had unilaterally terminated its IMET program, but then the United States continued to train Indonesian officers under the J–CET program. I believe our witnesses will find the time to address this issue in testimony today.
    My colleagues, the Subcommittee is honored to have a top-flight panel to share with us their views on these important issues.
    Our first panelist is Ambassador Stanley Roth, Assistant Secretary for East Asian and Pacific Affairs. Assistant Secretary Roth is certainly no stranger to the Subcommittee, having served as its long-time staff director. Welcome back.
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    He is joined by the Under Secretary of Defense for Policy, Walt Slocombe. Since 1977, Under Secretary Slocombe has held a wide variety of key positions within the Department of Defense and has written numerous articles on U.S. defense policy. Secretary Slocombe has a well-deserved reputation as a consummate public servant.
    Our final witness will be Admiral Joseph W. Prueher, Commander in Chief, U.S. Pacific Command. Admiral, welcome. In that capacity, he is commander of the nearly 100,000 sailors, soldiers, airmen, and marines that I mentioned earlier, and he is the chief military representative from Hawaii to India for our government. Prior to assuming current duties in January 31, 1996, Admiral Prueher served as Vice Chief of Naval Operations, preceded by commanding the U.S. Sixth Fleet and NATO's Naval Striking and Support Forces in southern Europe.
    Now, before we receive your testimony, I'd like to call upon the Ranking Minority Member, the distinguished gentleman from California, Mr. Berman, for any remarks that he might have.
    Mr. Berman.
    Mr. BERMAN. Mr. Chairman, because of some constraints on my own time, I'm going to skip giving an opening statement. There are only a couple of points.
    First, to express my appreciation—this is a very important issue, a very important hearing. And you've assembled the right people, and I think you're to be commended for moving ahead on this.
    The questions I hope are addressed are—two in particular, at some point in the hearing; better while I'm here, but even if afterwards, I'll hear about them from my staff—the whole notion of strategic partnership with China. What it means? How some of the recent Chinese decisions, for instance on joining the missile technology control regime, their reluctance to help us seek justice for the Khmer Rouge leadership in—from Cambodia, some of these issues that have been difficult issues. In what context do those decisions play a part in what we're trying to achieve out of this military-to-military contact? I'm not against it. I just want to raise the question.
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    And then, second, with respect to Indonesia, one can't help but get more and more distraught about what's going on there. In a sense, their whole attitude with respect to the conditions that the IMF seeks—they seem to be making a mockery out of the whole process. And the Chairman's own point: for a while now, there's been concern here that this J–CET program, operated by DOD, has been characterized as an end run around IMET. I know that the Department of Defense does not consider it that at all, but I'd like to hear—I think on the record it would be good to understand a little better why that is the case and particularly given the congressional statements and the Administration representations with respect to IMET to Indonesia.
    Thank you, Mr. Chairman.
    Mr. BEREUTER. Thank you, Mr. Berman.
    In addition to the newest Member of our Committee and Subcommittee, the gentlelady from California, Mrs. Capps, we're joined by Congressman Steny Hoyer, distinguished Member from Maryland. He is interested in Asian issues, has demonstrated that for a long period of time in addition to being the leader of our delegation in some ways in the past and continuing today on the OSCE. Mr. Hoyer, you're welcome to participate here today.
    With those openings, I'd very much like to invite our witnesses to present their testimony, preferably in 10 or 15 minutes each, if you can. We may be interrupted for a vote. We'll accommodate that as necessary. Your entire statements will be made a part of the record.
    Secretary Roth, please proceed as you will.
    Mr. ROTH. Thank you very much, Mr. Chairman.
    Let me begin by commending the Subcommittee for holding this hearing. I fully agree with Congressman Berman that this is an exceedingly important topic, but particularly because I'm usually asked to testify on a specific country or a specific problem. It is a pleasure to have the opportunity to testify about the big picture and to try to set the overall context for a number of policy issues.
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    Because I think this is a such a serious issue and because I think it's such a good opportunity, I have submitted an unusually long—30-page—statement for the record. I will not read it to you. But let me cover the highlights.
    Briefly, what I tried to do was to divide the testimony into two parts. The first part is to describe briefly our key security relationships. The second part is to try to discuss some of our key security challenges, not all of them problems. I didn't attempt to be comprehensive in flagging every potential security issue in Asia, but we'd be happy to respond to any of your questions.
    Let me begin with the key relationships, because I think it's important to start with what's right before you get to what needs to be worked on. And I think that overall I am quite pleased with the status of our security relationships with Asia.
    Let me begin with Japan. Needless to say, the U.S.-Japan Security Treaty remains the foundation of U.S. engagement in Asia. I think we have achieved considerable progress in demonstrating the relevance of the security relationship in the post cold war period. There was a lot of anxiety only 3, 4 years ago in Japan about this. I just came back from Japan last week. You don't hear any of that anxiety now. I think the President's summit, I think the reaching of the agreement on the guidelines, I think the fact that we were able to sign an ACSA, Acquisition and Cross Servicing Agreement, last week, or to amend and improve it all demonstrate that the security relationship retains tremendous vitality. That, of course, is accompanied by Japanese cooperation on a very broad number of issues.
    Most recently, I went on a mission with Ambassador Richardson in which we were able to secure Japan's public support for our policy toward Iraq. So both on the military and on the political side, I think this relationship is in very strong shape, despite the challenges that we face, admittedly, on the economic side of the House.
    I will defer to my military colleagues in talking more about some of the specific bilateral security issues, particularly with respect to Okinawa and implementing the SACO recommendations. All I'd like to say is while the Futenma issue remains unresolved, we are working hard on it, hand in hand with the Japanese Government, and remain committed to implementing what was agreed upon. And I hope that we'll be able to make progress before the end of the year.
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    Turning to South Korea, obviously, this is a critical relationship, given the fact that we face approximately 1.8 million men under arms approximately on the peninsula. This obviously remains a very dangerous and crucial part of the world. In terms of our security relationship, once again I think it is in excellent shape. I visited last week with Secretary Albright to meet President Kim Dae-jung and his new team. I think they're very committed to working closely with us in terms of bilateral issues, in terms of north-south issues. I think we have a very strong pace for proceeding together and build channels, bilateral negotiations, and four-party talks.
    I think we tend sometimes to give all our focus to northeast Asia, and we don't necessarily remember the relationships we have in southeast Asia and Oceania, but I try to point out in my testimony that we have three important alliances in these other two regions as well. And I dealt with them in my testimony in alphabetical order—Australia, the Philippines, and Thailand. And I think, once again, you'll find these relationships in good shape. The President's trip in 1996, I think, further solidified and strengthened an already excellent relationship with Australia. We have cooperative relations across a broad spectrum of bilateral, regional, and multilateral issues. We get the kind of support you would expect from a staunch ally from Australia on issues like APEC, on KEDO, on the ASEAN Regional Forum. We work together closely on a number of regional problems.
    The Philippines—I think we've had some good news this year. As you know, from previous testimony and your own travel, we've had some problems with relation to the lapse to the Status of Forces Agreement and the necessity, therefore, to suspend our ship visits and our exercisers. We have, through hard negotiations, been able to reach agreement on a new procedure for a visiting forces agreement, which has been signed to governments, and I hope that the Philippines Senate will ratify it after their election this year. And if this takes place, which we expect, this would enable us to resume ship visits and exercises, which is an important component of our military relationship.
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    I think the Thai relationship has also been strengthened on the security side. Prime Minister Chuan was just here for a meeting with President Clinton. We were able to work out an understanding on the aircraft. I think we're helping them with their economic recovery and a lot of the issues from last summer have ceased to be as prevalent. We maintain close ties with the Thai military, and we have access when we need it to strategic airbases. We're getting cooperation on counter-narcotics as well. All in all, that relationship, I believe, is in good shape.
    Before moving to what I call the key challenges, let me just say a few words about one of the issues that doesn't get enough attention, which is regional security architecture. As you know, we continue to say and continue to believe that our bilateral security treaties remain the centerpiece of our security posture in the Asia-Pacific region. But at the same time, I think the Clinton Administration has launched an important initiative, which is trying to promote a Pacific community, which was one of President Clinton's themes in 1993 from his APEC trip. And we have been working very hard, even as we maintain a bilateral relationship, to try to develop some multilateral regional security architecture.
    Asia has been marked by the absence of the kind of infrastructure that you have in Europe, and so we've been pushing hard on the military side with the ASEAN Regional Forum to deal with regional security issues, and on the economic side, APEC, to deal with some of the regional and global economic issues. And if, admittedly, these organizations are still in a nascent state, I think we may well be at the beginning of an historic period, in which we're beginning to see the development of institutions that can further our own national interests, enable us to share certain burdens, multilaterally.
    Let me now turn to the challenges. In my assessment, I didn't do it alphabetically, I did in what I thought was the most dangerous immediate issue, which is the Korean peninsula. Again, when you have 1.8 million men under arms on the peninsula, and that includes more than a million North Koreans, many of them located close to the DMZ, and when you include an American security obligation and the presence of 37,000 troops, obviously this is a highest priority issue for the United States.
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    Our policy is clear.
    First and foremost, it depends upon deterrence. And to that end, we not only maintain our troops, but we have a steady system of exercises and other mechanisms with the Republic of Korea to ensure that the North Koreans understand the message that this alliance is, as we say, rock solid.
    But at the same time, we are pursuing diplomatic initiatives to try to lessen the threat, both in a bilateral sense, with south and north dialog recently going through an important go-round in Beijing, as yet inconclusive, and in the four-party talks, where we've had two rounds. I think our strategy is very clear. We're trying to begin with confidence-building measures and tension-reduction measures. We'd like to see the DMZ truly be a DMZ. We'd like to see implementation of some of the aspects of the 1991 north-south agreement. We think it's going to be very difficult after more than 40 years of conflict to immediately have a peace agreement. But we want to start with the CBMs and work our way up. And I think we now have two diplomatic processes underway. I see no contradiction between them. During Secretary Albright's trip last week, she reaffirmed our support for north-south dialog. President Kim reaffirmed the support for the four-party process. That's mutual.
    Two more security issues, though, with Korea. One cannot only consider the conventional balance. I believe that the food issue is a security issue, that we don't want to risk any threats to deterrence if North Korea would become desperate. And that is why the United States is participating generously in the multilateral food effort for North Korea. But please, remember there is a security component, as well as a humanitarian component to food policy.
    And then the third security issue, of course, is the nuclear issue, which, at the moment, we have a freeze on the North Korean nuclear program. I think the KEDO, and the agreed framework marks one of the major diplomatic accomplishments in Asia for the Clinton Administration. But we still need to keep that agreement fully funded so that we can proceed with the construction and meet our obligations under heavy fuel oil so that the agreement does not unravel. Only a few years ago, we were in relatively dire shape, where there was a possibility of sanctions and the risk of conflict. Now we're in a situation where that has been largely diffused, and we would like to keep it that way.
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    Next in my testimony, I turned to China. I think it's pretty obvious that as China increases in economic size and importance, it has the capacities both for guns and butter. And it's going to be an increasingly important power that we're going to have to deal with.
    Our strategy, as you know, has been one of comprehensive engagement. We believe we've made great progress pursuing that strategy, and that it's helped us to achieve accomplishments in a number of different areas.
    In terms of the security relationship, again, I think my colleagues will talk about it more in terms of the mil-to-mil aspects. But let me say that in terms of political military aspects, I believe we have a considerably improved strategic dialog with China. We are working very closely, for example, on North Korea. That's an area where their positions are almost identical to our own in the four-party talks. We are having a much more productive dialog, I think, about the U.S. role in the Asia-Pacific theater. We're no longer getting called the hegemon and being urged to leave and withdraw forces. I think we're getting a much more sober discussion when we talk with Chinese security experts. So I think this is an area of progress.
    Non-proliferation—I've testified before on this. We've made enormous progress. We have a lot of progress to go, but I think we can discuss more of the specifics in the Q&A period.
    Finally, before leaving China, a couple of words about Taiwan. As we saw in March 1996, cross-straits tensions can rapidly and dangerously escalate. U.S. policy on PRC-Taiwan relations remains unchanged. The United States continues to support the peaceful resolution of the Taiwan question. And we believe that cross-straits dialog provides the most promising mechanism through which to defuse tension. In that regard, we are encouraged by signs of a renewed willingness on both sides of the Taiwan Strait to resume this dialog. And last month, as you know, there were the first high-level contacts between the two sides since 1995, which is an encouraging step. And I think this is probably the single most useful thing that can be pursued to defuse tensions in the strait and to promote the interests of all three of the parties.
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    A third subject that I highlight in my testimony is what I've called maritime territorial disputes. What we're really talking about is many of the island disputes, both in the East China Sea and in the South China Sea, and these are both complex sets of issues. I didn't try to unravel them for you in the testimony. I merely tried to make the point that it's important that we not forget that these exist; that they have the potential to escalate. We saw that with Mischief Reef in 1995. The United States has been trying to foster a more energetic diplomatic process with the countries in the region, particularly the claimants, or the Indonesian workshops, to try to deal with the South China Sea issue. And we've been urging the parties to the disputes in the East China Sea to try to reach diplomatic resolutions as well. We don't believe that they can just be ignored; that they could come back and bite us at some point in the future. And should certainly be on a list of security problems.
    Finally, I turn the security implications of the Asian financial crisis, because there are some. And I think, first of all, there's the dog that hasn't barked. And here I'm referring to North Korea. One of the biggest security concerns in the wake of the crisis was that North Korea might perceive that at a time of economic distress in the south, this might be a moment to do something militarily. That has not happened. We have gone out of our way to reemphasize the importance of deterrence. We had the Republic of Korea defense minister and chief of staff in Washington the end of last year for our annual meetings. I think that sent a strong message to the North at a key moment in the economic crisis. And to date, there is no information that North Korea is trying to take advantage of the economic situation.
    A second set of concerns relates to what's been called the Southeast Asia financial crisis, and here we're really talking about the continued coherence and viability and activism of ASEAN. We sometimes take ASEAN's 30 years for granted. There were many problems in the region before ASEAN became an effective force. A lot of ASEAN's effectiveness has depended on Indonesia remaining a key member willing to cooperate with the other countries, and active. As a bloc, ASEAN is a major player. It's influenced Chinese behavior in ways that we would favor, and so we would like to see ASEAN maintain as a vital organization, which is one of the reasons why we work so hard to help them out of the current financial crisis.
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    I think I will stop at that point in deference to the bells.
    [The prepared statement of Mr. Roth appears in the appendix.]
    Mr. BEREUTER. Thank you very much, Mr. Secretary. We have a 15-minute vote, now down to about 7 or 8 minutes. And we'll have to recess at this point. It may be followed by final passage. But I'd anticipate we will be in recess for about 15 minutes, and we'll attempt to reconvene at 2:45 p.m. I apologize to our witnesses for this necessary break.
    The Subcommittee is in recess.
    Mr. BEREUTER. [presiding] The Subcommittee will resume its hearing. Next we'll hear from the distinguished gentleman from the Defense Department, Secretary Walt Slocombe.
    You may proceed as you wish, Secretary.
    Mr. SLOCOMBE. Thank you, Mr. Chairman.
    It is, as always, an honor to be here to represent the Department of Defense along with my colleagues and friends, Stan Roth and Admiral Prueher, and particularly to talk about the important issue of U.S. security interests in the Pacific. Like Mr. Roth, and, for that matter, Admiral Prueher, my statement is quite lengthy because I tried to address, if not all the issues, at least many of the particular country issues. And so, in my summary of this, I'd like to focus on the overall picture and then talk about a number of specific problems.
    There is a basic interplay between security and economic development, and that is particularly true in the Pacific, where the most remarkable development in the last generation has been the truly amazing degree of economic growth, which is of fundamental importance to the American economy, as well as to the people in the region, and, for that matter, the rest of the world. The security that has been provided in large part by our presence in that region and our security relationships in the region has been a necessary, not a sufficient, but a necessary condition of that economic development.
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    That security is even more important in times when nations must take tough decisions to surmount economic problems than it is in times of easy prosperity. So we have now a continuing interest in adhering to four basic strategic tasks:
    First of all, we have to maintain the vitality of our bilateral alliances and our friendships with countries with whom we do not have formal alliances.
    Second, we need to maintain our forward presence, both to serve as a symbol of our concern, to provide deterrence, and most fundamentally to provide an immediately available powerful military force as needed.
    Third, we have to promote a stable, sound, and lasting relationship with China, recognizing that we, as well as China, have a fundamental interest in regional and global peace, and in China developing in constructive ways.
    And finally, we must seize the opportunity offered by multilateral fora, organizations like ARF, the ASEAN Regional Forum, and the Northeast Asia Cooperation Dialogue, to advance transparency, resolve tensions, and improve confidence.
    In addition to this necessary connection between security and prosperity, the United States obviously has a great number of direct security interests and challenges in the region. Asia is, after all, a collection of powerful economically competitive states with some of the world's largest militaries, some of which are or could be nuclear armed.
    Second, America's alliances, built on undeniable and clear mutual interests and threats during the cold war, face new challenges and responsibilities in the different era in which we now live. There are, as your opening statement mentioned, Mr. Chairman, and Secretary Roth's did as well, competing territorial claims, mostly involving small insular areas, but that could prove dangerous in the long run. There are in Asia, as in other parts of the world, deep seated ethnic tensions and the potential for political turmoil and social unrest.
    And further, several nations in the region have active programs for nuclear, chemical, or biological weapons and the means to deliver them. These are of concern both in themselves and for their proliferation potential.
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    I believe that the fundamental fact about our interests in the region is that key nations in the region are going through periods of fundamental political, social, and economic transition. And it is very much in our interest to see that transition work out in positive ways for our very important economic and strategic interests.
    In short, the current financial crisis reinforces the fundamental longstanding policy that the United States has pursued for decades. Now, more than ever, we have an interest in keeping the peace and maintaining stability in the region.
    Furthermore, we may now have a special opportunity. The talk of American decline, so prevalent to a visitor to Asia just a few years ago, is now noticeably silenced. The region's leaders are looking to America. We have an opportunity now to work with the countries and leaders there to resolve longstanding sources of instability and head off potential future problems.
    You mentioned the question of maintaining the U.S. force presence in the region. In the Quadrennial Defense Review, which was mandated by Congress and which was Secretary Cohen's first order of business as Secretary of Defense, one of the very first decisions which he reached was to reaffirm America's commitment to remain forward deployed in the region and also in Europe. Specifically, we intend to maintain approximately 100,000 in the Asia-Pacific region. And we have committed the necessary resources to do this in our long-term defense planning.
    It's also worth making the point that there is very broad support in Asia for that presence. And a recognition by key countries, notably, but not exclusively, Japan and Korea, of the need to continue to host those forces and bases in the region or in other ways to provide access that we need to maintain our presence.
    Both Japan and Korea, as you know, make substantial financial contributions to our presence, as well as accepting the presence on their territory of what are for them very large foreign forces.
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    The U.S. Defense Department and the U.S. military, of course, recognize that we have an obligation to manage the inevitable problems that our presence causes for local communities. But there is every reason to be confident that we will continue to have the necessary access and bases to support our forward presence. And we will certainly have the necessary defense resources to maintain it.
    Let me turn briefly to some of the key countries.
    First, China. We seek a steady and sustained engagement that can help shape China's transition in positive directions. It is the quest for that steady and sustained engagement that is what we mean by moving toward a strategic partnership, which Congressman Berman referred to.
    The United States does not fear China, nor do we view China as an adversary, though we do have real and important issues between us and China that have to be resolved peacefully. Rather, the United States seeks to engage China to step forward as a responsible and cooperative nation, a nation that preserves its unique identity and works to advance its own interests, but is more open in security matters, and more respectful of the rule of law. A nation that adheres to international norms in its own affairs, including protection of basic human rights. A nation that plays a constructive international role and respects the corresponding standards, including peaceful resolution of disputes, participation in the control of proliferation of weapons of mass destruction, and respect for freedom of the seas. And perhaps most fundamentally, a nation that joins us and the other countries in the region in rejecting a zero-sum attitude toward security, by recognizing the common interest we all share in a stable environment in the region.
    I mentioned the importance of proliferation. That, from our point of view, is not merely proliferation of weapons of mass destruction, but Chinese supply of high-tech conventional weapons, particularly to Iran.
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    One of the most important agreements reached between President Jiang Zemin of China and President Clinton of the United States during the summit in October concerned Chinese assurances regarding exports of cruise missiles and nuclear technology, which were re-affirmed to Secretary Cohen during his visit. We believe that those interests serve not merely a worldwide interest in non-proliferation and our own interests in not having high-tech capabilities to attack our forces in the region, but China's own self-interest in stability in the Persian Gulf, an area which will become an increasingly important source of energy supplies for itself.
    Both in this area and others, we remain alert to confirm that China is abiding by the commitments it has made in the non-proliferation field, and we pursue our concerns in this area very vigorously.
    Our two nations have already taken several steps in the military-to-military field to increase mutual confidence and decrease the possibility of miscalculations. And those are specified in some detail in my statement and Admiral Prueher's.
    I want to touch briefly on the question of Taiwan. The policy of the United States toward Taiwan and the People's Republic of China is aimed at preserving peace and stability in the Asia-Pacific region. We demonstrated our concern for stability in the region by our deployments in March 1996 during the PRC's missile tests and exercises. Our strategy, besides comprehensive engagement with the PRC, includes maintaining our obligations toward Taiwan, as stipulated in the Taiwan Relations Act. That piece of legislation and the three joint communiques form the basis of U.S. policy regarding China, including the Taiwan issue as they have done for successive administrations of both political parties.
    Our premise is that an adequate defense in Taiwan is conducive to maintaining peace and security while differences remain between Taiwan and the PRC. I want to call particular attention to that aspect of the 1982 Joint Communique, in the context of which we made clear that our statements were premised on the expectation that the PRC would seek only a peaceful resolution of the Taiwan issue. In that connection, we are encouraged by the recent resumption of cross straits talks. A constructive Taiwan-PRC dialog serves the interests of all the parties, and can be a major element in achieving long-term regional stability.
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    With regard to Japan, as Secretary Roth has said, the U.S.-Japan security alliance has played a critical role in our strategy in the region, and is our most important strategic relationship in the region.
    The strong U.S.-Japan security relationship will be as important to Asia's future as it has been to its past. And, significantly, that relationship is much more broadly supported now in the domestic politics of Japan than at times in the past. Far from being seen as a cold war relic to be dispensed with, it is understood as vital to security for Japan in the new era. And, indeed, nations throughout the region recognize the alliance as critical to their interest in regional peace and stability.
    As was mentioned in the opening statements, the agreement between the United States and Japan on new guidelines for our defense cooperation is an extremely important development in solidifying that alliance. In my full statement, I outlined some of the provisions of that agreement. In general, the guidelines provide a framework for the United States and Japan to move planning for their cooperation in the security field to a higher level.
    There has been mention made of the presence of U.S. forces in Japan. I think it's worth noting that Japan, like Korea, makes a very substantial financial contribution to the presence of those forces. Japan pays something like $5 billion each year. We intend to implement the SACO process for restructuring the presence of U.S. military on Okinawa while fully maintaining our operational capabilities.
    With respect to Korea, I won't add to what Secretary Roth has said except to underscore that as Korea goes through what is in some sense its first real democratic transition, as well as passing so far quite successfully through a very grave financial crisis, the U.S.-Korea security alliance remains focused on deterring renewed hostilities on the Korean peninsula in the face of the possibility that the reclusive leaders in the north could somehow imagine that a military adventure would ease their problems. We welcome the assurances by the new administration and President Kim Dae-Jung, who's made a strong commitment to maintain Korea's defense capability and its contributions to the costs of the U.S. presence in the face of the very real economic difficulties that the Republic of Korea faces.
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    Secretary Roth pointed out the importance of the Agreed Framework that has closed down the very substantial nuclear effort that was going at Yongbyon before it took effect. We continue to have concerns about North Korea's weapons of mass destruction and long-range missile potential, because of its potential both for its own use and for export, but the scale of the nuclear problem has been significantly contained by the agreed framework. And in that connection, I want to underscore the importance of the United States continuing to provide funding for its contribution to KEDO for heavy fuel oil deliveries, which is a necessary precondition for the viability of the agreement.
    With respect to Indonesia, I won't elaborate on the very great importance of that country, which is the world's fourth most populous, and the world's largest predominantly Moslem nation. We believe that relationships between the United States and the Indonesian military can serve our interests. And we have pursued on a limited scale such contacts over recent years.
    Let me address briefly the issue of the so-called J–CETs. I simply cannot accept the characterization of these as in any sense an end-run around any kind of limitations. They are fundamentally different from IMET or FMF, which are designed to provide direct benefit to the recipient countries, either in the form of training or a provision for financing for military equipment. Of course, we believe those programs serve our interests, but the direct benefit is to the host country.
    In contrast, the purpose of the J–CETs is training U.S. special operations forces for one of their key missions: operations with and training of foreign forces. These exercises provide invaluable opportunities for our special operations troops to familiarize themselves with the skills that they need, with the countries they will need to work in, to practice their language skills to become familiar by actual hands-on experience with the techniques necessary both by statute and by the absolute policy of the special operations command. But the benefit to the United States for training has to be paramount, and the benefit to the host incidental. They are, of course, authorized by separate statutory authority entirely separate from IMET or FMF. There is a careful process for the decision on when to do them. They are coordinated by the regional Commander in Chief (CINC), and I know that Admiral Prueher will want to address how, in particular in the case of Indonesia, but throughout his AOR, they serve the CINC's engagement strategy. They are, pursuant to law, reported annually to Congress. But recognizing the concerns that have been expressed about this program, we have decided to adopt new measures to provide fuller reports and closer OSD oversight of all of these exercises, including a quarterly review of the plans.
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    As I said, the United States has real interests in maintaining a good relationship with Indonesia. We have a powerful interest in Indonesia meeting its obligations, which are in its own interest, under its agreements with IMF. At the same time, we have real concern about the Indonesian Government's human rights policies. Failure to open the political process and abuses of official power are not only wrong in moral principle, they gravely undercut the investor confidence necessary for Indonesia to overcome its economic difficulties.
    We are in the present difficult context taking special care to ensure policy review of all U.S. activities with Indonesian armed forces. But we believe that those activities serve our broad interests.
    The rest of my statement proceeds through a number of other countries. I didn't have the very clever idea that Stan had of going in alphabetical order to avoid implications as to relative importance, and the fact that I will skip the remainder now has no significance other than that I think that I've already gone well over the time that you asked us to limit ourselves to. So, if you'll consent to put the rest of the statement in the record, then I can address some of the issues in response to questions. Thank you.
    [The prepared statement of Mr. Slocombe appears in the appendix.]
    Mr. BEREUTER. That will be the case, Under Secretary Slocombe. Thank you very much for your testimony. We appreciate receiving it today.
    Next, the Subcommittee will hear from Admiral J.W. Prueher, Commander in Chief, Pacific Command, the CINCPAC. Admiral, nice to see you. Please proceed as you wish.
    Admiral PRUEHER. Thanks very much, Chairman Bereuter, and I appreciate the opportunity to be here to represent the 300,000 people in the Pacific Command and also thank the Committee for its steadfast support to national security which we all work so hard for.
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    I will give a short assessment and then try to give a quick logic train for our activity and the standards we use for that, and I'll—as little as I can—repeat the excellent statements by Secretary Roth and Secretary Slocombe.
    As you have pointed out in your comments, the Asia-Pacific region is huge. It's got about 60 percent of the world's population and 35 percent of the U.S. trade. It has the 6th largest Armed Forces in the world, and it is pivotal to our national security.
    The mission of the Pacific Command, flowing from the national security strategy and the national military strategy, is to maintain security and stability in the Asia-Pacific region, and we face this on a foundation of two premises. The first is that political, military, and economic issues and challenges must be worked together. Of course, our part is the military piece of it, but as you see represented here, we've got both the diplomatic part represented, and we try to work very closely together. We find, as do you, when the military, political, and economic portions get disconnected, things don't work so well, so we work very hard on that.
    The second premise is that military security undergirds the generally stable conditions which allow for economic and political prosperity to occur. Secretary Albright talks about this in terms of the fact that an economic system rests on top of political order which in turn rests on military security. These two premises are the basis of our strategy, which is fairly simple. Our Pacific Command strategy is one of three parts: it is preventive defense, responding to crises, and then being able to fight and win a major conflict. We try to work these things and spend most of our time in preventive defense.
    Examples of what we do in peacetime, while we are trying to prevent conflict and maintain security, include exercises with other nations. There are short visits. There are things that we, trying to be modest, call high-level visits back and forth. There are congressional delegations, in fact, going to visit these nations. There is the Asia-Pacific Center for Security Studies in Honolulu, which gets people—this new class has students from 43 different nations who are military, political, academic, and from the business community—and co-mingles them as we talk about Democratic principles and gives them a chance to interact. There are conferences on law of armed conflict and logistics. There's Pacific Area management's seminars. Things like this abound, and they go on day-to-day, and that's what we do in peacetime. We use the 100,000 troops, or the capabilities represented by these 100,000 troops, that we have forward deployed to engage in preventive defense.
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    Another key part of what we do in peacetime is prepare for crises. We train and we prepare to be able to ratchet-up. And crisis response, the next part of our strategy, requires credible, ready, military forces at the right time at the right place for the right reasons. Good examples of this are the responses, as has been pointed out, to the China-Taiwan Missile Crisis in March 1996 where our response was with two carrier battle groups at that time.
    Another example is in the fighting that went on in Cambodia about 9 months ago by one of the prime ministers of Cambodia where things were becoming contentious in Nampan. We were able to respond with about 530 special operations forces and nine aircraft that went to Utapo, Thailand to be positioned nearby that helped keep a lid on the situation. And those are examples of what we do with crisis response.
    The third element of our strategy is to be able to fight and win a major conflict, which our forces have been ready to do along with the Republic of Korea (ROK) allies for the last 45-plus years. The fact that we have not had to fight that fight since 1953 is a tribute, I think, to the fact of being ready and with national will, and having the wherewithal to do that which has enabled us to operate in the lower level in the realm of preventive defense.
    What I would like to do with the remainder of my comments is address the five things that we are working on that are foremost on our minds as we proceed for the next year or two. First—and these have been covered to some extent by Secretary Roth and Secretary Slocombe is the preservation and the strengthening of the pivotal security relationship in the Asia-Pacific region with Japan. We are working hard on this as Japan tries to define its own security role in Asia. For the future, we are working with them on the new Defense Guidelines.
    Second on the list is building the foundations of a military-to-military relationship with China as a strong part of the overall relationship with China. There are examples, as Secretary Slocombe pointed out in his written testimony. When Secretary Cohen was in Beijing in January, he signed the Military Marine Consultative Agreement (MMCA). It's the first written agreement we've had with the Chinese that allows us to diffuse potential misunderstandings or look at various issues that may come up where we have a conflict of interest in maritime areas, and this is very important.
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    As we work with China from the China-Taiwan Straits Crisis of 2 years ago whereas the regional CINC, I had zero contact with the Chinese—zero military contact or even phone contact with them—we now have a fairly healthy communications dialog with the Peoples Liberation Army (PLA). This is a much better situation for the world. We were in quite a hurry to build this communications link, and it's owing to the efforts of a lot of people that this has occurred. But now I think the pace with China can move at a moderate rate as we work on the issues of mutual interest to China and the United States.
    The third area that we think about a lot is helping to create the conditions that allow for reconciliation on the Korean Peninsula to occur. The new President of Korea, Kim Dae Jung, has talked about reconciliation with the North as his No. 1 priority. He has opened up some communications links, and the other people here on this panel are pivotal in helping to open the dialog between North and South to bring about some ''detensioning'' or reconciliation on the Korean Peninsula. It is important for us in the military sense—and General John Tilelli is the head of our forces in Korea—that we keep our military forces ready so that we don't walk off the field in the fourth quarter of the game and forfeit. We need to see this through to the end, and we're prepared to do that.
    The fourth thing that we are working on is building a military-to-military relationship with India. In our dealings with India, and certainly the political dealings with India as well, we note that they are increasingly concerned about their broader relationships as they look northeast toward China, and east toward the Association of Southeast Asian Nations (ASEAN) for their financial future. India, of course, has been aligned with the Soviet Union during the cold war and has been largely militarily inward-looking. However, they are now starting to look out for security in South Asia and also in the south in Southeast Asia. It is very important that we work with India, and we are working hard on building that military-to-military relationship, and it's showing signs of fruition.
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    The last thing that is very much on our plate is trying to deal with the impact of the East Asian economic crisis on security matters, and those things, as have also been pointed out, are very closely intertwined. This economic crisis has hit all the nations in East Asia, but primarily South Korea, Thailand, and Indonesia. South Korea has a plan working with the International Monetary Fund (IMF) and it's working along pretty well, and Thailand also has a fragile, but upward trend-line, plan in dealing with the economic crisis. It is, then, with Indonesia where we look where they are under heavy stress both politically and economically with the decrease of the Rupia. This puts the Indonesian Armed Forces (ABRI) in an extremely sensitive situation, and we are trying to stay in close touch with the Indonesian military in a constructive way to be as helpful as we can as they work to maintain order, a chore that is up to them to do.
    I would like to close by giving one example, related to Thailand, of our engagement strategy, because it's such a good one, and it involves an International Military Education Training (IMET) graduate, General Mongkon, the Supreme Commander of the Royal Thai Armed Forces, as Secretary Roth pointed out, about 9 months ago when the Chavalit Government was about to fall in Thailand, they were having the baht crisis, there was a lot of pressure on Mongkon to take over militarily. Owing to his training; owing to a lot of his character as well, and I would like to think some association with us over a long period of time, he supported free democratic elections in Thailand, which they had that resulted in the election of Prime Minister Chuan and has resulted in progress for Thailand as they move forward in dealing with their various crises. This is a good example of our engagement with Thailand over a long period of time. They've been a treaty ally; a good friend, and we have worked with them both economically and politically, and then got into the ball game economically with them a little bit later on. Thank you very much. I look forward to questions, sir.
    [The prepared statement of Admiral Prueher appears in the appendix.]
    Mr. BEREUTER. Admiral Prueher, thank you very much for that example; for your testimony, in general; very helpful from all three of you.
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    I'd like to move to a question period now. I'll focus a bit on Secretary Roth first, because I know you have a 3:45 deadline. All of you are welcome to make comments on these questions, and I would welcome that.
    First, I would ask you if you could say a few things about the way that the United States is attempting to participate and is participating in the ARF, the organization component of the ASEAN effort. To what extent are we participating? How do we do that? And what are our objectives in this participation?
    Mr. ROTH. Well, I welcome the question because I think this is a much-maligned institution. It's frequent to hear, particularly in the academic circuits that the ARF, or ASEAN Regional Forum, is essentially a talk fest, and I think that is inaccurate and misses the point. As I tried to say in my testimony, it's a very important component of our overall strategy of trying to establish a Pacific community. Before ARF was established, there was no institution in the Asia-Pacific region in which the leaders, either on the civilian side or the military side, could get together to discuss security issues to develop a common language; to start sharing prospectus, and, ultimately, to try to promote confidence building measures; maybe, later on, move on to preventive diplomacy. I attended the first meeting of the ASEAN Regional Forum which was only back in 1994 and it was remarkable. I saw seated around the table the foreign ministers of countries that not that many years before had been enemies, and you had an incredible diversity of views all along the ideological, political, and economic spectrum, and, yet, they're all coming down together to talk, once a year, about security problems. That's very positive.
    But more than that, I think what you have here is several different aspects to the work of the ARF. One is that it's an opportunity to integrate China into the entire region, so that China's participating in the discussion of security issues. It's not an anti-China coalition or something to be viewed with suspicion, but it's getting China to adapt some of the same terminology the rest of us use.
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    Second, it's an opportunity for the militaries to try to get to know each other better. Many of these militaries had had minimal contact among themselves, and now we've had a series of what's called intercessional activities and conferences; meetings in between the ministerial level.
    Mr. BEREUTER. So, what level of participation from the military would we have from the United States?
    Mr. ROTH. It's upgraded each year, actually. I hope this year we may have an Assistant Secretary level at the ARF itself; I'm not sure yet. The intersessional activities are usually at a lower level, sometimes DAS, sometimes office director; they depend. And, of course, on the State side it's at the Assistant Secretary level for the Senior Official and at the Secretary of State level for the meeting itself.
    Mr. BEREUTER. Now, my understanding, Mr. Secretary, is that we'll have not only the ASEAN countries there but we'll have the United States; we'll have the People's Republic of China; we have Russia, for example, in a forum, in discussions. Is that correct?
    Mr. ROTH. That's correct. And I think that, obviously, there's a huge perspective when you get all those players together, and that's useful to bring them together on a regular, as opposed to ad hoc, basis. I think that a lot of the work happens between the annual meetings at these intercessional activities which is, I feel, the most contact between the military components that takes place. For example, CINCPAC hosted a session which the State Department chaired—the CINC was the host—on search and rescue for all the members, and this brought a number of military people together who'd never talked to each other. That's a very positive step, and we're doing more of that in the CBM area.
    Mr. BEREUTER. And Australia and New Zealand participated in these meetings as well.
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    Mr. ROTH. Oh yes, there are 18 members who participated.
    Mr. BEREUTER. And who convenes them? Is it a leadership decision within ASEAN country?
    Mr. ROTH. Yes, it is the ASEAN Regional Forum, and so it always happens that you have a sequence. First, there's the Annual ASEAN Ministerial Meeting, and then that is followed by two subsequent meetings: the ASEAN-hosted Ministerial Conference, and there's the ASEAN Regional Forum. So, it's always in an ASEAN country; it rotates among them, whoever is the Chair of ASEAN.
    Mr. BEREUTER. Mr. Secretary, I'd like to move to the subject of Taiwan PRC relationships and the relationship between the United States and those two entities. There's a lot of discussion—some of it here in the Congress—about the upcoming summit and always uneasiness on the part of Taiwan, Taiwanese-Americans, and people who are supportive of Taiwan that there may be some change in that relationship that would not be deemed to be salutary by Taiwanese or Taiwanese interest. One of the interesting things that has happened is that we have a resolution introduced by a couple of distinguished Members of the House, H. Con. Res. 270 just very recently—April 30th—and, undoubtedly, there's been some attention and will be more to it. I don't know if you had a chance to look at it in detail, but I would ask you a couple of questions as I cite to you two elements in the resolution.
    One, there's a whereas clause that indicates that the PRC refuses to renounce the use of force against the people of Taiwan, and then in the resolve clause it seeks a public renunciation by the People's Republic of China of any use of force or a threat of the use of force against the democratic Taiwan. To what extent is that consistent or inconsistent with what the Chinese have said, and to what extent, if any, has there been discussion of which you're aware between Taiwan and PRC related to the concept that's been a part of our policy that there will be reunification or unification only under peaceful means and that has been something which we insisted on?
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    Mr. ROTH. A lot of questions there. Let me start with U.S. policy. First, as you know and as you've just stated, we have always had as a key element of our own policy that the process has to be peaceful, and that this is the entire key to our premise for normalization, and is what we asserted unilaterally at the time of normalization, and we continue to raise this at every high-level meeting with the Chinese Government, and as Secretary Slocombe has indicated in his testimony, I think we've also demonstrated our commitment to the principle of peaceful reunification by the deployment of our two carriers in March 1996 when we felt that there was a threat to stability and we demonstrated through the largest Naval deployment since the Vietnam war that we were serious about seeing peace and stability maintained. So, I think there should be absolutely no question about U.S. policy on this score. I think there has, unfortunately, been an unwillingness on the part of China to come up with an explicit renunciation of force. They say the same thing each time which is that they cannot preclude the use of force because they cannot preclude Taiwan behavior. So, we have not been able to reach an agreement on that; we simply emphasize our policy and our insistence that any resolution be peaceful.
    Mr. BEREUTER. And, Mr. Secretary, what has Taiwan said, if anything, about independence?
    Mr. ROTH. Well, as you know, the Government of Taiwan supports a one-China policy as much as the other side of the strait supports a one-China policy. It is not a policy based on independence.
    Mr. BEREUTER. And is it opposition party spokespersons that have raised the issue of independence or raised the visibility of the prospect?
    Mr. ROTH. There are now several opposition parties in Taiwan, and they differ in degree on their own positions—but there are parties in Taiwan which advocate independence.
    Mr. BEREUTER. But there's been nothing to indicate at this point that the Government of Taiwan supports an independent Taiwan. Is that correct?
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    Mr. ROTH. That is correct. Lee Teng-hui has said on multiple occasions that he's not seeking independence.
    Mr. BEREUTER. Any reaction, in general, to the desirability of this resolution pushing for a public renunciation by the PRC of any use of force or a threat of use of force against democratic Taiwan?
    Mr. ROTH. No. Let me say that I think we are at a hopeful moment in Cross Straits relations that after suspension of roughly 3 years in the dialog, we've now had a resumption of meetings between the parties. It's not a resumption of the formal high-level dialog yet, but there's some optimism that this will take place possibly before the end of the year, and I think it would make the most sense for the United States to try to stay out of the this process and to let the parties, themselves, try to work out the pace and scope of what they're going to do together; work out their agenda. I think at this point, we don't need something that might endanger that process. I think let's encourage the Cross Straits process because that most protects everybody's interests.
    Mr. BEREUTER. Do you think there's a possibility this would damage that opportunity for a Cross Strait dialog and reconciliation?
    Mr. ROTH. A lot depends on how the Chinese interpret the resolution, but if they see this is as a critical resolution, somehow interfering in affairs, it is going to harden their position going into the talks.
    Mr. BEREUTER. Thank you, Mr. Secretary. Under Secretary Slocombe, in your comments, the part that you did not discuss directly and for the purposes of time, I notice you have a section on Singapore, and I have visited Singapore and know a bit about that. Admiral Prueher has an important set of contacts there, repeatedly, as I understand it. I think it might be good if you could at least, briefly—one or both of you gentlemen—address the importance of the contributions of the Singaporese to our military presence, naval presence, in the region and any difficulties or opportunities to further enhance that cooperative relationship that you might want to identify?
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    Mr. SLOCOMBE. Mr. Chairman, I think it would be appropriate for me to ask Admiral Prueher, with whom I had the pleasure of visiting in Singapore some time ago, to address the degree of cooperation with the Government of Singapore with the U.S. military.
    Admiral PRUEHER. I think the cooperation and enthusiasm that Singapore shows are a strong recognition of the strategic importance of having the U.S. presence not only in Asia overall but in Southeast Asia, and they are making every effort they can to enhance this, and this comes from the senior minister to the prime minister down through their uniformed military. In a short statement, I think there's probably little more that Singapore could do to enhance the ease of our military presence in Singapore than what they're doing. They are doing a great deal. They have announced the construction of a carrier-capable pier. They are potentially offering even office spaces to use there. We have a strong logistics presence which they offered actually before we left the Philippines, but we have a Naval logistics base where we ship repair and a logistics hub there. We have exercises with the Singaporeans and always have a friendly climate and also constructive participation not only in work like the ARF but every bilateral and multilateral effort that we have has strong participation from the Singaporeans. It's a close relationship; it could not be better, sir.
    Mr. BEREUTER. Thank you, Admiral. I do have a question related to a controversy concerning actions by Hughes and Loral which are suggest by some, allegedly by people in the Defense Department, that the information provided to the People's Republic of China related to satellite launch on two occasions is a threat to U.S. security interests. Obviously, there are certain types of technology that we try to keep restricted to the closest allies or to ourselves, and so the opportunity for us to maintain export controls is an important part of our defense responsibilities. What can you tell this Subcommittee about the question of whether or not security interests of the United States were damaged by Loral and Hughes' activities?
    Mr. SLOCOMBE. It is certainly the case that we attach great importance to the strict enforcement of our export control laws, and it is for that reason that within the last, I guess, nearly a week, Deputy Secretary Hamre wrote the chairman of the Full Committee explaining our position with respect to the release of information about the assessment of the incident you refer to. It is certainly the case that the Defense Department did provide an assessment of the case and submitted our report, as requested, to the State Department. The State Department subsequently decided that the situation merited a review by the Justice Department, and the Justice Department has initiated a criminal investigation. The Department of Defense has consulted with the Department of Justice, and Justice, by letter from the Attorney General, has asked that the Department of Defense not release the report at this time, because Justice has concluded that doing so even in redacted form would compromise an ongoing criminal investigation. The Committee has a copy of Attorney General Reno's letter. The Justice Department has also informed us that it will continue to review the Committee's request and will contact the Department of Defense immediately should it determine that it's become possible to release the report or a redacted version of it without compromising the criminal investigation. We are prepared to support the Committee's inquiry as best we can without jeopardizing the ongoing investigation, and members of our staff are working with your staff to seek to refine the scope of your request for other materials. I regret to have to not be as responsive as I would like to be to the inquiry, but that's the advice which we've received from the Justice Department.
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    Mr. BEREUTER. Mr. Under Secretary, I expected that response. I don't argue with it. I think this is an important matter of security and of interest to this Subcommittee and to the Committee and to Congress, and so we will expect to have the kind of cooperation that you promised under the conditions that permit you to give it to us.
    Mr. Rohrabacher, we have just a few minutes with Mr. Roth, and I'm going to turn to you in a just a second. If you have any questions for him, you might want to direct it to him first. But, Secretary Roth, when we're talking about export controls—in my final comment at this stage to the witnesses—I'd like to focus for your opinion on the success, at this point, of the separate Customs Unions concepts on export controls that we have with Hong Kong. The Hong Kong Visitation Task Force that I chair has visited Hong Kong. We've spent some time with Custom officials. We didn't see any reason for alarm; they seemed to be highly professional. But extraordinary amounts of things go in and out of Hong Kong, and, at this point, what is the Administration's attitude about the success of maintaining a separate Customs Union so that we can protect dual-use technology from going to the PRC through Hong Kong?
    Mr. ROTH. Let me state up front that this is not a special area of expertise of mine, so I'll give you a detailed answer for the record, but that thus far this has not been a problem area that has been brought to my attention in the many conversations that I do have about Hong Kong. My general impression is the way you stated it, but I'll get you a more detail-specific answer for the record.
    Mr. BEREUTER. I thank you; that would be welcomed.
    [The information supplied by Mr. Roth was submitted following the hearing.]

    Hong Kong has remained a separate customs territory and has enjoyed a high degree of autonomy in the export controls area as called for in the Sino-UK Joint Declaration and the Basic Law. We have seen no evidence of Chinese central government involvement or interference in Hong Kong export control decisions. Chinese central government officials have made clear on several occasions that they consider export controls a trade—not foreign policy—issue, and thus within Hong Kong's sphere of autonomy.
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    Hong Kong has a long history of effective strategic trade controls; it first began licensing trade in sensitive goods in 1950. The legal basis of Hong Kong's export control regime is the 1955 Import and Export (Strategic Commodities) Ordinance, which governs imports or exports of weapons or military-related equipment, nuclear, chemical, and dual-use items. The Hong Kong Import and Export Ordinance is regularly reviewed and amended as necessary to incorporate the most up-to-date provisions agreed upon by the various nonproliferation regimes. Since reversion, Hong Kong has aggressively reached out to increase cooperation with numerous countries on export control matters to maintain the confidence of its trading partners in its export control regime.
    Hong Kong and U.S. government officials continue to exchange export control information, including in-depth exchanges on specific issues such as proliferation concerns and diversions. In October 1997, Secretary for Commerce, William Daley, and Hong Kong Secretary for Trade and Industry, Denise Yue, agreed to begin semi-annual inter-agency meetings to exchange information and provide updates. The second such meeting is taking place here, in Washington, on July 20 to 21. Representatives from four U.S. agencies and three Hong Kong agencies will discuss developments in export control and enforcement policy as well as the legal and regulatory basis for prosecuting middlemen involved in the financing and arranging of sales of weapons of mass destruction.
    In addition, U.S. officials continue to conduct both pre-license and post-shipment checks in Hong Kong without restriction. Cooperation with the Hong Kong Government on this and other law enforcement matters is excellent.
    Two recent cases demonstrate the Hong Kong enforcement authorities' ability and willingness to enforce its own export control laws even when the mainland is involved. In the first case, Hong Kong SAR Customs officers seized a Chinese armored personnel carrier being shipped, without the required license, from Thailand back to China via Hong Kong. The APC was confiscated and the carrier fined for failing to declare the arms shipment. The Chinese owner of the APC has petitioned in Hong Kong courts to have it returned, but the case was still pending as of July, 1998. The second case involved a high-performance computer allegedly re-exported from Hong Kong to Changsha Institute on the mainland. Hong Kong authorities are investigating the companies allegedly involved in the re-export, and the Chinese have returned the computer to the U.S. manufacturer.
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    Mr. BEREUTER. Mr. Rohrabacher, the gentleman from California is recognized for questions.
    Mr. ROHRABACHER. You talked about a strategic partnership with China, is that what you're talking about? Is that the words you're using, ''strategic partnership?''
    Mr. ROTH. The words from the joint statement issued at the last sentence were that we would work toward moving toward a constructive strategic partnership.
    Mr. ROHRABACHER. Partnership against who? The Philippines? Taiwan? Malaysia? Tibet? Who is this partnership going to be against?
    Mr. ROTH. Nobody. Partnership is not a military alliance. All this was——
    Mr. ROHRABACHER. Strategic was the word, I think, that goes in there that makes it relevant.
    Mr. ROTH. No, nothing in the intention of this is anything resembling a military alliance. What it's an attempt to suggest is that we believe there are many regional problems where we can work together to advance our mutual interests. For example, we believe that we have an increasingly common interest in the Persian Gulf now that they've become an oil importer. We believe they have as much of a strategic interest in keeping the Gulf open to the free flow of oil at the lowest possible prices.
    Mr. ROHRABACHER. Is there any indication that the Communist regime in Beijing is still transmitting technology to the Iranians? Have you had any intelligence indications that the Chinese regime, right now, up to this date, are still transmitting technology to the Iranians?
    Mr. ROTH. Obviously, I'm not in a position in an open hearing to talk about intelligence. Obviously, we've also had concerns with some Chinese activities, not necessarily government activities, with respect to Iran.
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    Mr. ROHRABACHER. So, you're here in our open hearing talking about a strategic partnership with a country that's now engaged in providing missile technology to the Iranians, and you know it, and I know it.
    Mr. ROTH. It's pretty much the opposite. What we're talking about is trying to have the type of relationship and dialog with China which gets them to have policy changes consistent with our own. That's what we mean by this. No one is claiming that we have this constructive strategic partnership now. It's an objective we're trying to move toward. We've had some success in some area; not in others. We work extremely well, for example, with respect to North Korea with them in a very constructive way that advances our strategic interest. It's not an across-the-board statement; it's an objective.
    Mr. ROHRABACHER. We have disagreement on Korea, as far I'm concerned. By trying to promote stability in North Korea, we've extended the life of a really vicious, ugly regime. We have a disagreement on that, and, of course, the Chinese were very willing to be helpful in promoting the stability, meaning the longer life, of that regime in North Korea.
    Do any of you know about the Chinese presence on Mischief Reef? You're sitting talking to us about a strategic partnership with the Chinese occupation of part of the Spratley Islands; what kind of signal do you think that gives to our democratic allies in the Pacific like the Philippines or Malaysia or Singapore or the rest?
    Mr. ROTH. The countries you mention each strongly support our policy toward China and particularly this notion of having an engagement policy and getting along better for peaceful resolution.
    Mr. ROHRABACHER. Well, I'm sure they do. I mean, after all, where else is there for them to turn? If the United States is groveling, who else can stand next to them? Nobody. I mean, that's not to mention human rights, of course.
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    Mr. SLOCOMBE. With respect, sir, the United States is not groveling to China.
    Mr. ROHRABACHER. Let me ask you a question, sir. Do the Communist Chinese now have the capability of landing a nuclear weapon in the United States delivered by a missile fired from the mainland of China?
    Mr. SLOCOMBE. The Chinese have had intercontinental ballistic missiles for, I should think, 20 years. So, the answer is yes, as it has been for a long time.
    Mr. ROHRABACHER. And has their capability to accomplish this goal been increased in the last few years?
    Mr. SLOCOMBE. We have no reason to believe that the ICBMs that they have are, at present, any different from ones they've had for a long time.
    Mr. ROHRABACHER. So, you're testifying in this Congress, right now to us, that you believe that their missile capability is not different today than it was before, say, 5 years ago?
    Mr. SLOCOMBE. The ICBMs that are now deployed are, to the best of our knowledge—and we think we know—the same that were deployed 5 years ago.
    Mr. ROHRABACHER. Boy, I'll tell you, you just uttered so many weasel words, I don't know if you should finish your statement or not, because it's meaningless. There were about 20 weasel words in that answer.
    Mr. SLOCOMBE. Sir, would you let me finish my statement, my answer to your question.
    Mr. ROHRABACHER. If you will answer the statement directly, you can finish it, but when you come up with——
    Mr. SLOCOMBE. The question was, do we have any doubt that the ICBMs are the same now as they were 5 years ago? We have no doubt they are the same as they were 5 years ago. What I've been trying to do is to finish my answer, which is we also know that the Chinese have a missile development program which would presumably produce a next generation of ICBMs.
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    Mr. ROHRABACHER. And has any American technology been put to use in those new generation of ICBMs?
    Mr. SLOCOMBE. There is no evidence to that effect.
    Mr. ROHRABACHER. There's no evidence of that at all? You haven't been reading the newspaper lately?
    Mr. SLOCOMBE. I've been reading the newspaper. I've also been reading——
    Mr. ROHRABACHER. And you discount the stories that some American companies have transmitted American technology to the Red Chinese in order to enhance their missile capability? You just dismiss that?
    Mr. SLOCOMBE. I addressed the issue of the Loral Hughes business a minute ago, and I regret that there's not more I can say about that. The question you asked, sir, was not whether there have been charges of transfer of technology as, of course, there have been and they are now under criminal investigation. The question was whether we had any evidence that that technology had been incorporated in Chinese ICBMs, and because of the schedule of when the work is done, it seems unlikely, since the development work began before the incident.
    Mr. ROHRABACHER. Well, that's because you, again, have put a weasel word into my question. I didn't mention that incident, did I?
    Mr. SLOCOMBE. No, you asked——
    Mr. ROHRABACHER. You're the one who answered my question based on one incident. My question went way beyond that, and you've gotten around answering the question.
    Mr. SLOCOMBE. I think the question—well, restate the question.
    Mr. ROHRABACHER. I will restate the question and could have it read to you if you like, but the question is, do you have any information that would indicate that American technology has been transferred to the Communist Chinese which is now being incorporated into their missiles?
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    Mr. SLOCOMBE. I have no evidence——
    Mr. ROHRABACHER. I didn't use the word ''Loral'' or ''Hughes'' or anybody else.
    Mr. SLOCOMBE. There is no evidence that any American technology has been incorporated into Chinese ICBMs. There have certainly been charges that there have been transfers of American missile technology. You asked me if I'd been reading the newspapers, and the one which was in the newspaper yesterday was the Loral incident.
    Mr. ROHRABACHER. Now, that's not the only incident. Tell me, can a Long March rocket deliver a nuclear weapon to the United States?
    Mr. SLOCOMBE. I'm not sure I know what you mean by a Long March rocket. The rocket the Chinese——
    Mr. ROHRABACHER. You don't know what a Long March rocket is?
    Mr. SLOCOMBE. The Chinese certainly have an ICBM, there's no question about that, which can deliver a missile to the United States.
    Mr. ROHRABACHER. Well, maybe if you read—I'm the chairman of the Space Subcommittee, and I know a little about Long March rockets——
    Mr. SLOCOMBE. I'm sorry.
    Mr. ROHRABACHER. Go right ahead.
    Mr. SLOCOMBE. I'm informed that the Chinese name, or at least what we think the Chinese name for their ICBM is, is a Long March rocket. That's not the term which is usually used in intelligence reports.
    Mr. ROHRABACHER. Well, we have an advertisement here from the Chinese company talking about how effective their Long March rockets are now. The Long March rocket used to be a joke. It used to be a joke. It would blow up three out of four times. Now, they put advertisements in saying how effective they are, and you're sort of satisfied to sit back and say, ''Well, there's no evidence that American technology has been brought to play here.'' These Long Marches cannot only launch satellites, they can launch nuclear weapons to the United States of America, and I'm surprised——
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    Mr. SLOCOMBE. Isn't the Long March the term they use for their satellite launch vehicle?
    Mr. ROHRABACHER. So, you're suggesting that——
    Mr. SLOCOMBE. I assume that's what they're advertising.
    Mr. ROHRABACHER. You're suggesting that a missile that launches into space a satellite isn't also capable of launching a nuclear weapon?
    Mr. SLOCOMBE. Depending on the characteristics of the missile, that's often the case. I'm only responding to the question of what particular capability is which is being advertised in the advertisement you refer to.
    Mr. ROHRABACHER. Yes, well, we've asked for copies. This Committee has asked for copies of all waivers signed by this Administration to American technology companies dealing with technology that goes into their rockets, and we're going to look at them, and there's a lot more evidence than just the Loral meeting, and if you folks don't know about it, well——
    Mr. SLOCOMBE. I'm aware that there are a lot of questions which are being pursued, and, indeed, it is our desire to be able to effectively enforce the export control rules which underlies our unwillingness to provide the report that was requested earlier.
    Mr. ROHRABACHER. One last thought, Mr. Chairman, and I'm sorry for being—I have a cold today, and I'm a little cantankerous, but also it's a very important issue, obviously. Mr. Chairman, this issue, obviously, is something that means life and death to millions of people, millions of American people. It's something that enhancing the ability of a Communist Government like that of the Communist Chinese Government in Beijing; enhancing their capability to deliver nuclear weapons is something that would be a betrayal of the people of the United States as far as I'm concerned.
    Mr. SLOCOMBE. Mr. Rohrabacher, I entirely agree with that.
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    Mr. ROHRABACHER. All right, and when we rush forward—I know that people in this Administration are totally committed to peace. They believe that we're going to have a better world, a more peaceful world if we just blur over the human rights abuses of this monstrous regime. They could kill every man, woman, and child in Tibet, and there would still be businessmen here and our Administration telling us, ''Let's ignore that, because we've got to have peace with these people.'' Or, ''We can bring them around to a better civilization and civilize them if we just don't confront them.'' And I know that, but when you start blurring what's right and wrong and what's democratic and what's not democratic and our relationship with Communist thugs like they are in Beijing is the same as we have with democratic partners, and we're going to have a strategic partnership; when you come up with that type of proposal, that type of way of dealing with these people, of course you're going to have major corporations going, ''Well, why not give them this technology?'' Why not? If they have—if we find——
    Mr. SLOCOMBE. Well, the short answer is because it's against the law.
    Mr. ROHRABACHER. Well, if it's against the law, this Administration has created the atmosphere and the belief in these businessmen's minds that what they were doing was not wrong, and, of course, waivers from the President of the United States might come into play in this as well, and we'll see where it plays out. Thank you very much.
    Mr. SLOCOMBE. Mr. Chairman, I would only like the opportunity to observe that I do not, of course, agree with the characterization of the Administration's policy. If you want me to explain why, I'll be happy to, but maybe, for the record, it's just easier to leave it at that.
    Mr. BEREUTER. Very well. We'll accept that——
    Mr. ROHRABACHER. Mr. Chairman, I have some written questions that I'd like to submit for the record.
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    Mr. BEREUTER. Without objection, those written questions will be made a part of the record.
    [The questions appear in the appendix.]
    Mr. BEREUTER. And I would just make the observation that if any of the allegations are true, it may well be that the right kind of recommendations came from the Defense Department to the Administration; the right kind of recommendations in this Member's judgment and in that Member's judgment, I would guess. We shall see eventually; it's an important issue.
    Secretary Roth, I have just a few final comments to make to the other two gentlemen, and if you'd like to take your leave now, you certainly have that opportunity.
    Mr. ROTH. Thank you, and I certainly will respond to any questions for the record.
    Mr. BEREUTER. Thank you so much for participating today. Gentlemen, I just have a couple of last things to say and suggestions and, actually, some compliments.
    One, with respect to the J–CET Program, I think that the comments that have been made and the comments in the writing seem to answer the questions that Mr. Berman raised that were important questions I thought that needed to be responded to. There may be controversy regarding the issue yet, but I think you have addressed the questions that I believe he intended to ask and that I would have asked.
    Admiral Prueher, I visited the Asia-Pacific Center for Strategic Studies, is that the proper name?
    Admiral PRUEHER. Security Studies.
    Mr. BEREUTER. Security Studies. And I was impressed with what has happened there with the first three classes. The people you have assembled full-time, part-time, I think you've got good administrative leadership now to avoid some of the difficulties that, perhaps, plagued the Marshall Center when it started. I had a chance to meet with the retired Marine Corp general who has assumed that responsibility. I have great expectations that this is going to be very beneficial to the best interests of the United States and a cooperative relationship with many Pacific-Asian countries. I hope that we can have very broad participation in it. Quietly, I went to visit the two-story building over in Fort Derussy which used to be the home of it, and I just walked through; nobody asked me questions; it's a reserve center at this point. I believe that the line-item veto, now overridden, was an accidental mislocation of the issue, and I think the Administration did not expect, actually, to veto that, because it seemed to be consistent with their policy. Are we now able to proceed with the renovation of that building so that the center may move there?
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    Admiral PRUEHER. Yes, sir, we are. We're about to let the planning contracts on it, and expect to be able to move in in the year 2000.
    Mr. BEREUTER. Are there any difficulties that you can see or any support that you would need from the National Security Committee or from this Committee?
    Admiral PRUEHER. The continued support for the budget of the Asia-Pacific Center would be very useful, sir, because it is budgeted at an adequate level, but it is a nascent organization which is growing. We do not want it to be stillborn. It's off to a great start, and we need to keep it going, sir.
    Mr. BEREUTER. I certainly think that should be our objective. I do hope that we can continue to have and even build upon a cooperative relationship with the East-West Center which seems to be another important institution in the region.
    Admiral PRUEHER. Yes, sir. Mr. Chairman, there is one more item. It's the issue of tuition waivers which allows us to waiver the tuition cost to some nations that cannot otherwise pay their tuition to come, and that is an important issue that is a discussion in the Congress now, sir. Your support on that would be welcome.
    Mr. BEREUTER. Thank you. Mr. Under Secretary, I've had a chance to spend a long time with Australians and visit some of their defense installations in January with Chairman Spence and other members of the National Security Committee, and I am always impressed with the degree of cooperation we have from the Australians and the level of rapport between our two people. It appears that there may be the need for additional training opportunities in the region, and my assessment is that they seem to be quite interested in being cooperative. Is there anything you'd like to say regarding the prospect for continued or enhanced cooperation with another important ally in the region, Australia?
    Mr. SLOCOMBE. We have, as you say, excellent relationships in the defense field with the Australians. We do a lot of training with them now, but there certainly have been discussions about expanding training, particularly in northern Australia, and that's something which we're pursuing as with any other big project like this. There are domestic, environmental, and construction problems and so on, but it's something that we think over the coming years we would like to see developed. Maybe Admiral Prueher wants to add.
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    Admiral PRUEHER. In fact, Mr. Chairman, their prospective equivalent of Chairman of the Joint Chiefs is in town now, and we had a meeting this morning talking about that very subject. They are willing to provide training areas. We had a large exercise there in 1997. We'll have another one in 1999. It's going quite well with the Australians, and we're training in existing training areas. There's discussion of expanded ones which may be useful downstream, but the dialog is healthy, sir, on that.
    Mr. BEREUTER. That's good to hear; it's not surprising, and I encourage you to continue that emphasis. I am concerned about the difficulties we're undoubtedly facing in military-to-military relationships with Indonesia. It's hard to know how far things will deteriorate in that country. We hope for the best under the proper kind of movement toward pluralism and democracy, but I think the Australians have been playing and can play an important role on maintaining a relationship with the positive things that need to be done with the Indonesian military, and, perhaps, they will have to play a role since we are to some extent taken out of that situation at the moment. I just pass on to you that they seem to be concerned and interested in being helpful in that respect, and I'm speaking of the Australians.
    Admiral PRUEHER. Yes, sir. I couldn't agree more. We're in steady touch with them also.
    Mr. BEREUTER. And, finally, I would mention that from a number of sources I hear the concern that our less than perfect relationship with New Zealand because of the nuclear ship visit issue has caused the deterioration in our military relationship, obviously, but also caused deterioration in the capabilities of the New Zealand military. Do you have any thoughts about whether or not they—I suppose one could not expect them to conclude that it may be deteriorating, but what can we do, directly or indirectly, what can other allied countries such as the Australians do to make sure that when the New Zealand Government seeks assistance in maintaining quality within their military, someone is going to respond to that concern and outreach?
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    Admiral PRUEHER. Sir, I do have some thoughts, but I think that's a little more closely in Secretary Slocombe's lane, if you would like to take that, Mr. Secretary.
    Mr. SLOCOMBE. First of all, it is certainly a source of regret, I think, for almost everybody in the Department of Defense who's ever worked with New Zealanders that the relationship is limited by the unfortunate choice that New Zealand made with respect to nuclear powered ship visits and requirements for declarations which would be inconsistent with our policy. The problem here is that the issue is precedent-setting and acquiescing in the New Zealand position would create problems for our Navy's operations worldwide. So, we have no flexibility on the issue of the legislation. We respect that it is a decision for New Zealand what it wants to do with its own legislation, and we see no sign at the present time that they have any desire to change it. We do maintain a limited exchange in the military field and in intelligence. New Zealand participates actively in some peacekeeping activities. They sent a small contingent in the recent buildup in the Persian Gulf; they, from time to time, have a ship in the maritime interdiction operation in the Gulf; they've had people in Bosnia. So, we have some opportunities to cooperate in a multilateral forum.
    All that said, I think we shouldn't exaggerate the impact of this on the New Zealand defense commitment. New Zealand spends relatively little money on defense even allowing for its size. That's a domestic choice, but it's one that I think you can't entirely attribute to restrictions on U.S.-New Zealand cooperation. They have, as I think Admiral Prueher said, a very active defense relationship with Australia who is—given that we're not in the picture any more—overwhelmingly their most important defense partner. We have made clear our support for the proposition that New Zealand should maintain a serious defense capability, quite frankly, against the day when we can resume the full reliance relationship we'd like to have, and, frankly, I'm concerned that they're not going to do it, but that's their choice.
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    Mr. BEREUTER. Thank you, Mr. Under Secretary. I'm aware of the fact that you two gentlemen need to go to meet with the Secretary. I have a final question. I might say, first of all, that I think there is no opposition to enhanced military-to-military cooperation with India that I'm aware of in the Congress; it's very much to be encouraged. What can we do or what are we doing with respect to Pakistan since one's interest in India or Pakistan is always measured by the interest that we express in the other country?
    Mr. SLOCOMBE. Well, it's outside his AOR.
    Mr. BEREUTER. It's not outside yours.
    Mr. SLOCOMBE. No. I believe that is in the interest of the United States to find ways consistent with our proliferation concerns to expand our security relationship with Pakistan. For example, I think restoration of full IMET is in our interest. I think the legislation which was passed which at least allowed us to resume some things which had been barred by the Brown amendment was a very positive step. I think it is very much in our interest to continue and expand our security relationship and our mil-to-mil cooperation with Pakistan, and—I'm just speaking for myself from this point of view—but I think some of the legislative restrictions which are extremely well-intentioned are not serving the purpose that they're aimed at and also are not consistent with our broader interests in a good relationship with what is after all a traditional ally—a country that has a lot to contribute to cooperation with us in a variety of fields and that would like to do it.
    Mr. BEREUTER. Thank you. The most recent positive thing that, perhaps, should be noted is that Pakistan played a very important role in trying to reengage the warring parties in Afghanistan in a dialog, and it was a very constructive contribution on the part of the Pakistanis.
    Gentlemen, thank you very much for your testimony and your patience today through our voting process. Your contributions here through your testimony and response to the questions is very important to the Congress, and I thank you for your service to the country and your testimony here today.
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    Mr. SLOCOMBE. Thank you very much.
    Admiral PRUEHER. Thank you, sir.
    Mr. BEREUTER. The hearing is adjourned.
    [Whereupon, at 4:05 p.m., the Subcommittee adjourned subject to the call of the Chair.]


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