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Office of the Press Secretary

                         BACKGROUND BRIEFING

September 21, 1994

The Briefing Room

2:04 P.M. EDT

SENIOR ADMINISTRATION OFFICIAL: Good afternoon. We will try to be relatively brief so that we leave a lot of room for discussion questions. I'd like to point out that my colleague is here -- if you have questions about our aids efforts, my colleague is here to answer them.

What I'd like to do, if it's useful, is to run through the schedule very briefly to orient you to what Yeltsin's going to be doing in the United States, if that's of interest. And then after that, just give you a few thoughts on how we're approaching this summit.

This state visit, it's one of the few state visits this administration has had. It is going to be the fifth meeting between President Clinton and President Yeltsin, since President Clinton took office. They did meet once in 1992 when then-Governor Clinton was running for President.

Yeltsin arrives this Sunday night in New York. He spends Monday in New York. He's going to meeting a group of American businesspeople in New York City on Monday morning organized by Jerry Corrigan, who as you know is the President of our Enterprise Fund with Russia.

Yeltsin and the President will see each other at a lunch on Monday hosted by Boutros-Ghali for world leaders at the U.N.G.A. Yeltsin speaks at the U.N.G.A. three or four hours after President Clinton does on Monday. He comes here, arrives at Andrews, and I think doesn't have anything scheduled Monday night.

The summit is going to be Tuesday-Wednesday, state visit, so the formal arrival ceremony on the White House lawn. That will be followed by a one-on-one meeting in the Oval Office between the two Presidents. That session, which will last, I would think, 30 to 45 minutes, will be followed by an expanded meeting in the Cabinet Room with eight, nine people to a side on foreign policy issues. My colleague from the State Department will be reviewing that for you.

The Vice President is going to host a lunch after that meeting at the State Department for President Yeltsin, to which the Vice President is inviting many members of Congress, the business community, some members from newspapers and news shows.

That is followed by an event here that is of great interest to us and to President Yeltsin. It's an event on the South Lawn that will honor the contribution made by Russian and American veterans of the second world war. We think it's very important to honor the contribution made by the Russian people in defeating the Nazis. As most of you know, this has been a big political issue in Russia, the fact that Russia was not invited to some of the commemorations earlier this year in Europe; and I know that the President feels very strongly that we ought to do the right thing and honor them here at the White House. And that will happen -- it's going to be quite interesting. American and Russian veterans of the Lend-Lease Operation, of the American Operation, where we sent aircraft from Britain to bomb Germany, and they went and refueled in Russia and returned on bombing runs.

We'll have members both from the Russian and American side of that operation, and also some of the people who met up on the Elba River in the spring of 1945. So that should be --

Q either one or --

SENIOR ADMINISTRATION OFFICIAL: Both Presidents are going to make remarks about the war effort. And one other aspect I'd like to draw your attention to on that event -- we have been working with the Russians to discover the fate of American servicemen who were missing in action and missing as POWs in the former Soviet Union after the second world war, and Americans who were shot down during the Cold War from some of our military operations in the 1950s, and Americans who may have been missing from the Korean conflict and could have possibly ended up in the former Soviet Union.

Ambassador Malcolm Toon, our former Ambassador to the Soviet Union in the 1970s, will be at this ceremony. And I think the President will want to talk about this effort. The Russians recently unearthed the remains of an American captain shot down in 1952 in what is now the Northern Territories, the Curiel Islands. And those remains are being shipped back to the United States to his family. So that will also be part of that event.

After that event, the two Presidents will come back with advisors to the Cabinet Room. There will be another 90-minute expanded meeting on security issues. And my colleague will be reviewing those for you.

After that -- this is all, again, Tuesday -- they take a break for a couple of hours, and then there will be the state dinner here at the White House on the State Floor that the President and Mrs. Clinton will host. The next day, President Yeltsin will be the guest of the congressional leadership up on Capitol Hill for a 90- minute, I guess, working breakfast with the leadership and many members of Congress.

From there, President Clinton and President Yeltsin and the leadership of Congress will meet at the Library of Congress, and they will together cut the ribbon on a new exhibit that Dr. Billington, the Librarian of Congress has arranged. It's an exhibit that covers the influence that Russia has had in Alaska and specifically the influence of the Russian Orthodox Church in the settling -- the modern settling of Alaska.

At that event the President -- the two presidents will also meet a number of the Americans and Russians who have been on these exchange programs that have been part of our overall assistance effort that Ambassador Simons has been coordinating.

From there they will come back to the White House. There will be a one-hour meeting in the Cabinet Room on economic issues. These issues largely will deal with economic reform in Russia and the huge success that the Russian government has had since the last summit in January on economic reform.

And then we're going to try something different. The President has been trying to find ways to highlight the importance of the private sector, the American private sector, in contributing to the success of reform in Russia. And so the first time, at least in my memory here, which goes back five years, we will be including -- the President will include in his meeting in the Oval Office --switch down to the Oval Office -- four American CEOs. He has invited them to attend a small meeting with President Yeltsin so that together the two presidents, a couple of ministers on both sides, Secretary Brown and Secretary Bentsen, Secretary Christopher will be there -- they can talk about how we can expand American private trade and investment in Russia, which we think is the future of the economic relationship.

And the four are: former Ambassador to Russia Bob Strauss, who is a highly respected figure in Moscow, and I think someone who is --

Q He's not a CEO, though, is he?

SENIOR ADMINISTRATION OFFICIAL: -- someone -- well, he's head of the U.S.-Russia Business Council. He is the -- heads the largest association that is dedicated to expanding trade and investment in Russia. He's highly respected by President Yeltsin and the Russian leadership. And the three CEOs will be Jack Smith, who is the President and CEO of General Motors; Jack Murphy, who is the President and CEO of Dresser, which, if you don't know, Dresser is a big company in Dallas which as been involved in the Soviet Union for 20 years selling oil and gas equipment; and Richard McCormack, who is the President of USWest. That is important, because telecommunications is going to be a big part of the future -- of our future relationship -- trade relationship with Russia.

After that event, the two Presidents are going to have a private, one-on-one lunch in the President's Residence, upstairs in the White House. That will be roughly a 90-minute lunch. Following that, a short break, and then there will be a press conference and signing ceremony in the East Room. I believe we'll have two or three things for the Presidents to sign. They may witness the signing of other agreements. They will both make statements at the press conference and answer questions from you.

Following that, the two Presidents will walk, or ride, over to the Chamber of Commerce Building just north of Lafayette Park, and they will attend a business reception with a couple of hundred American businesspeople who have gathered for this summit.

Now, behind the scenes on Tuesday afternoon, we're going to hold a business forum up in 450 of the EOB when the two Presidents are having lunch. Secretary Brown is going to have many representatives of the private sector in a conference to engage with their Russian counterparts and Russian ministers.

Tuesday evening, President Yeltsin hosts a return dinner at the new Russian Embassy on Mount Alto -- Wednesday evening, you're right.

Q Wednesday for 450, or Tuesday?

SENIOR ADMINISTRATION OFFICIAL: Wednesday. Wednesday evening, President Yeltsin will cut the ribbon on the new Russian Embassy at Mount Alto. He will then have the President and Mrs. Clinton as guests for a formal dinner.

Thursday morning President Yeltsin will leave Washington. He is going to be flying to Seattle. Secretary Brown; Ruth Harkin, the president of OPIC; Tom Pickering, our Ambassador; Dan Golden, the Administrator of NASA will go with him, among others. And he will fly into the Boeing airstrip and visit Boeing, Inc., and watch, I think, the final production of a new Boeing aircraft on the assembly line.

He then will go to downtown Seattle and give a major speech to a group of businesspeople. I think there's six western governors who will be there with him, a number of mayors from the Northwest, political figures and, I believe, Speaker Foley will also be part of that.

He then will visit with a typical American family in Seattle. And he will lastly take a tour of -- he will take a harbor cruise of Seattle harbor. And thus ends the state visit.

Q Is he staying at Blair House?

SENIOR ADMINISTRATION OFFICIAL: He is staying at Blair House; he's a guest of the President, a state visit.

Q Is there any precedent for that among Russian or Soviet leaders?

SENIOR ADMINISTRATION OFFICIAL: I believe it's the first time the Russians have elected -- President Yeltsin and President Gorbachev usually stayed at the Russian embassy. But it's a new era, and so the Russians accepted the President's invitation.

Let me just, if I could -- and we can come back to schedule questions if you have them -- submit to you three possible themes for this summit from an American perspective.

Q choose one? (Laughter.)

SENIOR ADMINISTRATION OFFICIAL: And you can choose whichever ones you like. I hope you like one of them.

Q One would travel fatigue, I think. (Laughter).

Q How about one on fatigue.


Q No, his -- he will be.

SENIOR ADMINISTRATION OFFICIAL: Secretary Perry has talked about a pragmatic partnership between the United States and Russia. We have also talked about a partnership that works, a partnership that is producing dividends. And there's no question in my mind that the dividends are appearing.

And let me just mention by way of example the tremendous progress that the Vice President has made with Chernomyrdin, the Prime Minister, in reaching an agreement on a $12 billion oil deal on Sakhalin Island, shutting down of Russia's plutonium production reactors, the success of the trilateral deal -- you remember that, signed on the European trip in January, ahead of schedule. And we are well on the way to making Ukraine a nonnuclear state in the process.

The troop withdrawals from the Baltics, which I would submit to you would not have occurred without the President's personal involvement and through his personal relationship with President Yeltsin, and the very effective support that the United States has given to the centerpiece of Russian reform, which is privatization. Ambassador Simons has coordinated this. It's a more than $200 million effort over three years.

If you talk to the Russian government we have been the major reason why they've had the resources to privatize these state enterprises. There's been a lot of talk about the ineffectiveness of U.S. assistance. I obviously don't share that view. And I would submit to you that there is a very concrete way where we are succeeding with American assistance, and Ambassador Simons will be glad to talk to you about that.

Second, I think the President will want to talk about the future of the relationship. In my own experience, at these summits -- especially even since the Cold War ended -- a lot of the business in past summits was mopping up after the Cold War, issues that were left from the Cold War. This summit is very much about the future. I think that's how you'll hear the President talk about it when he does talk, and it's very much about integration -- Russia's economic integration with the West, which means market access on our side and on theirs; their new relationship with the European Union. It's about political integration. We have taken the step to make Russia, in effect, part of a G-8 for political issues, for global political issues. And it's very much about security integration, and my colleague will talk about that -- NATO and Partnership for Peace.

And, finally, I would submit to you that the success of this policy can be traced to the fact that the President has treated it as his number one foreign policy concern. He has a very clear idea of what national interests are at stake. He has pursued these interests quite aggressively with the Russian leadership over the past 20 months, and I think successfully.

Let me just conclude by saying that economic issues, as in past summits, will be a big part of this summit. I've talked about the way we're trying to highlight trade and investment. My own view is that, unlike past summits, economic issues will not be at the center of the private discussions. I think there's a great deal of consensus between our two governments on the economic relationship, on the aid relationship and on the reform relationship.

Russia has come a long way on economic reform. It's a quite different picture than it was last January. Chernomyrdin has enacted reforms that are every bit as impressive as Gaydar's were in 1991 and 1992. And to give you an example, half the work force is now privatized, works in the private sector. The monthly inflation rate for the last two months running has been below five percent. This is not an economy that is heading downward, it is an economy that many people think may be bottoming out and beginning to rise slightly. I don't want to exaggerate the effect of this. It's very good news, but they still have a long way to go. But it's quite impressive.

And what Russia has as a prospect for the next two months is the culmination of a stand-by agreement with the International Monetary Fund. That is the stamp of approval of the IMF on Russia's economic reforms. It would mean that Russia would be given, loaned by the IMF roughly $8 billion to $9 billion in its first six to eight months after this agreement took effect. It could happen; it would be a remarkable achievement if it did.

But I do think that there is a great deal of consensus, and I think that the focus, the private focus will be on the security issues and certainly on the foreign policy issues; and my two colleagues can speak to that better than I can.

SENIOR ADMINISTRATION OFFICIAL: I'll be brief. But what I would like to do is simply suggest that the foreign policy agenda that the Presidents will discuss I think will fit very integrally into the themes that my colleague has outlined.

First of all, on the question of theme about a partnership that works. My colleague has already enumerated a few cases in which we believe the kinds of diplomacy that has been possible because of the relationship that we've developed has produced some very practical and tangible results. And that, I think, my colleague has already alluded to what has been accomplished with the Baltics, what has been accomplished with Ukraine. And I think we want to build on that momentum to see if we can tackle one other issue that's out there this time -- to see what the two might do to push forward some kind of a means of addressing NagornoKarabakh.

Quite frankly, this is one of the great tragedies of the entire region. And if our figures are correct, more people were killed there last year than in Bosnia. It is a tragic situation. And it is one that the President believes after talking with both his advisors and with President Ter-Petrosyan, who was here not long ago, is in a position where it is perhaps possible to make some progress where we have been pretty well stalled up to now.

And so he's going to be discussing with President Yeltsin, after he sees President Aliyev in New York about whether or not there's some specific steps that can be taken to move ahead the CSCE process that has been working on this issue for sometime.

And I think they boil down to a couple of objectives. One, to try to strengthen and consolidate the cease-fire that's in place. That's very fragile and very uncertain. And to see whether we can begin some practical steps that will build confidence and perhaps open the way to a broader ability to address the political issues that lie behind that conflict.

A second area where I think I would suggest our themes work as well as sort of pragmatic partnership and integration. We believe that the work we have done with Russia and Ukraine on the nuclear issue over the past year has been an extremely productive and satisfactory set of diplomatic achievements. And it's seen that way, I believe, by all three parties concerned.

We now, I think, face the prospect that Ukraine is, with its new president and its new government, about to undertake some serious steps to address their economic situation -- something that we believe is very important, and is going to require the support broadly of the international community. This was discussed, as I think most of you know, in Naples.

If in fact that we find that there is now a program of reform that is coming and that is going to open up prospects for real and rather dramatic change in Ukraine's economy, that is going to require some effort by all of us and not least of all by Russia. Russia has very important trading relationships. Ukraine is very much a debtor to Russia. And the question of how Russia will play a role in the support of Ukraine's reform is an issue that we're going to have on the agenda. And we will be encouraging them to take a constructive view of that.

Finally, I think the third issue that I would put before you as one that is an issue for the future is the question of the future security structure of Europe. If you have been following at all some of the debates coming out of Russia, it will be no secret to you that there is a variety of opinion over issues such as the future of Europe, Russia's place in it, the expansion of NATO and so forth.

What we are proposing this time is that the President will engage seriously with President Yeltsin to discuss what kinds of diplomacy we should be engaging in over the coming years, over coming months and year, to begin to shape, along with our allies and in consultation with the other European states, the new security structure of Europe.

Now, a year ago, or in January, really, there was a substantial discussion of the Partnership for Peace. President Yeltsin at that time told President Clinton he was planning to become a partner and would bring Russia into that program, and he did so this summer.

This will be a discussion, we believe, which goes beyond this, that tries to suggest that the President is fully committed to the integration of Europe and a Europe undivided and whole, but one in which the expansion of NATO at some point is something that we contemplate and, indeed, expect to occur, and that we don't see these two issues as mutually exclusive or mutually contradictory.

Q Can you have with -- settling Bosnia?

SENIOR ADMINISTRATION OFFICIAL: They will certainly discuss Bosnia. When you say "settling Bosnia," I think what I can --

Q Discussing future of --

SENIOR ADMINISTRATION OFFICIAL: Well, they will certainly discuss Bosnia. It seems to me that the Bosnia discussion will pick up from what President Yeltsin did in Naples in part, where he gave very strong support to the Contact Group and the proposals that it had developed in Geneva. We believe that the goals of the Russians and ourselves, in that we wish to end the war and to bring everybody to agreement to that proposal are not contradictory. And we would expect that they will have a discussion of what the next step should be. I don't think it's any secret that the Russian side does not view the issue of lifting the embargo, for instance, with any equanimity. I think what the President will say is that what we need to focus on is bringing the Pale Serbs to agreement, and that the important thing we believe Russia can do in supporting that is to keep the -- keep at it to influence the Pale Serbs to the extent they can and the government in Belgrade to urge that all sign up to the Contact Group's proposal.

Q Then you a problem coming up on October 15th. As you know the Pale Serbs are supposed to answer or else -- or else the United States is going to start moving the Security Council to lift the embargo. That was the President's promise in his letter to the Congress. Is he not going to discuss that and is the United States's obligation to do that and the congressional pressure to do that --

SENIOR ADMINISTRATION OFFICIAL: Well, of course, he'll discuss it. And I think it will be presented in the discussion as one of the many political factors that are weighing on this issue. And as one of the special reasons that we believe it important for Russia to do everything it can to bring the Pale Serbs to do what they should by the 15th of October.

Q Do you have any ideas?

SENIOR ADMINISTRATION OFFICIAL: What do you mean, any ideas?

Q On what the Russians can do. I mean, they've been telling the Serbs to do this for more than a year now --

SENIOR ADMINISTRATION OFFICIAL: Well, I can't really get much beyond what I've given you at this point on that. I mean, quite honestly.

Q Can you go back to what you -- tell us what you specifically mean about the expansion of NATO? Are you going to say the President will tell Yeltsin, we support full membership in NATO from Russia? Is that what that translates to?

SENIOR ADMINISTRATION OFFICIAL: I don't think that's what the President will say. I think what the President will say is that expansion of NATO is something we believe is going to take place. I don't believe he will say, and we think Russia will be first. What I think he will say is that -- is what he said last January, that we believe the question of who can join NATO is a question that will be decided over time, but that no one is excluded.

Q It's sound like you've adopted a theory of determinism so far as -- I mean, the President, the U.S. is the main mover in NATO. Is the U.S. going to push for full membership for Russia? You speak as though it's some natural evolution that's going to take place.

SENIOR ADMINISTRATION OFFICIAL: But you're putting the question now as membership for Russia. That is not what I was --

Q Well, put it any way you wish. I don't know what you mean by an expansion of NATO.

SENIOR ADMINISTRATION OFFICIAL: Well, I think the point is that the Vice President, the President have both said it's not a question of whether NATO will expand, but when. And we want to be sure that President Yeltsin understands that that is our view. We have not, I think, nor are we in a position unilaterally to make up our minds about how that is going to happen or when.

But what we do want to say is that we do not see that as mutually exclusive of the President's support for a policy that promotes European integration and a security structure for Europe that supports that.

I really think I ought to let my colleague do the security portion, then we can come back to some more questions.

Q follow-up questions. Advisors to President Yeltsin are saying that Russia is feeling still up in the air. They don't know exactly where to go. And what they are looking for eventually --- kind of -- (inaudible) -- where the United States would be part of. So they are basically looking at a kind of Atlantic community. So how are you able to say this kind of stuff to your European allies, where many of them are marching to a lot of different --

SENIOR ADMINISTRATION OFFICIAL: I'm not sure I fully understand the question, but let me just give you an example. We see as a part of the future of a security of Europe a role for CSCE. We believe that that will play a role.

Now, the future role of CSCE is something that Russians have said to us they wish to discuss. They have some certain views that I think don't necessarily coincide with ours fully, but we don't reject the idea at all that CSCE will have a role. Partnership for Peace will have a role.

In short, there will be a variety of institutions, it seems to us, that need to be considered as a part of the European security structure. NATO is one of those, and perhaps the most significant one, as far as we're concerned. But it isn't the only one.

Q My question would point to one thing. Isn't it necessary that you are sitting together a little bit closer with your European allies before you are hammering out your designs regarding Russia?

SENIOR ADMINISTRATION OFFICIAL: Well, look, I think we have almost continual consultation with our European allies about the entire range of subjects that I've been discussing, including whatever role we may see for Russia and other states in the European system. And the idea that we're -- if you're getting at the question, are we and Russia going to decide the future of Europe, well, the answer is a flat no. Well, the answer is a flat no. And we're very well aware that this is a matter of considerable interest, to say the least, with all the states involved.

And we have a regular and continuing dialogue with them in everything from the NATO forum to bilateral relations, and we'll continue to do so.

Q Mr. Karaganov said today that the START Treaty could not be passed in the Russian parliament today unless there were significant changes to it. In fact, he said today on the record that the chances of it not passing were about 55 percent. Do you have an idea of what the Russian Republic would like to do to change the START Treaty --

SENIOR ADMINISTRATION OFFICIAL: I think I'll let my colleague pick that one up because my colleague's in charge of START.

SENIOR ADMINISTRATION OFFICIAL: I'll get to START in a minute. I thought I would very briefly run down for you what I see the main issues on the security front -- three top priorities, one of which is the whole set of START treaties and how they fit together and what the future looks like with regard to START.

We really want to stress the way forward. We've had some good, solid progress with the trilateral deal, with denuclearization, with our defense cooperation at a convention level with the Totskoye exercise of a few weeks ago -- that kind of bilateral defense cooperation. But then also, we've seen Russia sign up to the Partnership For Peace. There is now, I think, underway a number of -- there are a number of activities, both on the conventional and the nuclear side where we can begin to see the way forward.

I'd like to stress for you, though, for this summit, really the nuclear side, because the whole issue of the safety and security of nuclear weapons has been at the top of many people's agenda and been receiving much attention in recent weeks with nuclear smuggling incidents emerging in Europe.

I think that this is an area where the United States and Russia have a special responsibility, as the two largest nuclear powers; and not only a special responsibility, but also an excellent opportunity to lead, to work together and to work out some solutions to these problems. They have had a special responsibility for many years -- the United States and first the Soviet Union, now Russia -- from the '60s on, we had a special relationship of mutual assured destruction. Well, now we can begin to talk about a relationship of mutual assured safety.

This is an idea that Secretary Perry raised in his speech yesterday. And I think it's a useful way to think about this whole issue. We really can work together in leading a solution to this problem.

So that, as I see it, is the first priority for this summit meeting, is to look at ways to improve the safety and security of nuclear materials. There are two ways to think about this problem. First, you have to address the problem at its source -- where the materials are stored, where the warheads are stored, where they are produced, where they are sent from one place to the other, how the transits occur. And there are ways that we can work with the Russians and have been working with the Russians to improve that whole situation.

There will be a particular emphasis in this summit on beginning a new set of negotiations to focus on stockpile issues, improving the overall safety and security of warheads and materials in their stockpiles.

That will include, for the first time, some exchanges of data, stockpile information that we have never exchanged before; some reciprocal visits to these sites, where we'll have Russians coming here to the United States and U.S. people going to Russia and really getting into some of these facilities and beginning to think about ways to improve both of our performance, with regard to the safety and security of warheads and materials. So that would be one way we'll be working this problem.

Another way, we already have underway some joint initiatives under the Nunn-Lugar program, and we'll really be pushing those forward very intensively. One is a $75-million project to build a storage facility for fissile materials. We have been pressing this project for sometime, together with the Russians; and we're now at a point from this summit where we can push forward to actually get the construction underway. The same with $30 million for some material control and accounting work together with the Russians, once again to improve the technologies involved, to improve the overall way that we account for some of those materials.

So that is dealing with the problem at its source. A second important way we want to tackle this problem at the summit is to look at the law enforcement side, to look at, really, the smuggling side. Once you have a problem where these materials are falling into illicit trade, falling into criminal hands, how do we address the problem. And there will be some particular initiatives that look at how to work with that.

It will build very much on the work that the Germans did with the Russians back in August on building some multilateral means to share information, to do better law enforcement, to do joint training. Those are the three areas where we'll be placing a lot of priority at this summit.

Now, the other major area, in addition to the fissile material, safety and security -- the whole "loose nukes" kind of problem, is in the area that this gentleman brought up, and that is the whole area of strategic stability and how we build on the START I agreement, the START II agreement now concluded, but not yet ratified by the Russian and American parliaments, and then how we move on to think about the future -- what further reductions are we going to be after, where are we going to go with the future of that process. That will be very much at the center of what the two Presidents look at.

But by the way, let me say that we have a lot of tools in this area. There is the official treaty regime, so to speak, that's built on the set of START agreements, and that will, I'm quite confident, go out into the future with further formal reductions.

But, nevertheless, at the same time we also have a very successful way we've worked with the Russians over the last five years or so, and that is parallel unilateral reductions. And there will be more of that emerging in this summit context. You may remember our detargeting initiative back in January, where the Russian side and the American side decided that they would no longer target their weapons on any other state on a day-to-day basis. That's a good example of a parallel unilateral initiative. And we'll be thinking with the Russians about how to proceed more along those lines as we're working the formal treaty regimes under START and getting those enforced, getting those implemented. We can also do some other things that push the envelope, so to speak, and that's another important part of what we'll be doing in the summit context.

Now, I think we've taken a lot of your time, and we did want to leave time for questions. If I may just move on to talk about your question and then we can get back to the broader set of issues.

I think we have some very good opportunities now with regard to the START regime itself. We are working to bring START I into force. START I, as you'll recall, brought the numbers down to the range of about 9,000 warheads. And we are already -- both the Russians and the United States, together with Ukraine, Belarus and Kazakhstan -- already informally bringing about those reductions.

We hope to actually bring START into force -- START I into force -- by the end of this year. And then in the course of the ensuing months, actually move on to ratify START II, so that by the time the Presidents next meet in a summit meeting -- and we expect that to be late spring, early summer -- that START II would actually be ratified.

I frankly, I have heard Mr. Karaganov on this subject before. I understand the arguments he makes. I think that there's a lot of work to do, but I think there's an excellent case to be made. So I am really quite positively thinking that we can move forward and have START II ratified by the time we get to the next summit. That will involve both parties beginning to think in specific ways about how we move forward to further reductions. And that is one thing the two Presidents will talk about in the course of this summit meeting -- how do we lay out our agenda for studying in a very serious way and figuring out what the reductions will be in terms of numbers and in terms of the way they come about. Will there be ways we think about restructuring our forces overall.

So I think there are good possibilities there; I just don't buy that we're at a total stall mode with the Russian Parliament.

Q A very quick follow-up on that issue. How would you characterize their side's opinion of this? I mean, what is their problem, exactly? You used the term, I think, something like "dead on arrival."

Q No, that was -- you said originally.

Q The original one. Yes, sir.

Q Not now -- now, he said it would still be defeated, though.

Q But he said it was about a 55 percent chance that it would --

Q Barry, do you want to background?

Q No, we were both there. I just want to make sure he represents what the man said correctly.

Q Yes, sir, that's actually --

SENIOR ADMINISTRATION OFFICIAL: Right, right. Well, you know, the way the START II deal is structured, if you'll recall, it calls for ridding the arsenals of all multiple-warhead ICBMs. And that actually pulls the numbers down very effectively on both sides, but because the Russians had a preponderance of their warheads in land-based ICBMs, multiple warheads on land-based ICBMs, it actually pulls their numbers down to the lower end of the final reduction numbers under START II. There was a band that was agreed to of 3,000 to 3,500 warheads under START II, and so it tends to pull the Russians down to the lower end of that band. And that's where a lot of the concern comes about in the Russian Parliament.

I think what a lot of people in Moscow tend to forget -- and the case needs to be made again with a great deal of energy -- is that the Russians, too, got something really important out of START II. They had, for years, been looking for constraints -- effective constraints on our bomber-loadings, and that's what they got out of START II. So there were good compromises on each side. And I think we need to go back -- not we, but those in Moscow who are working this problem -- need to back to the Parliament and make the case that there were significant compromises on both sides.

Q Could I address this question to your colleague, please? Could you talk about what effect do you expect to have on this summit from what's happening in Haiti? Specifically, do you expect President Yeltsin to come here and say President Clinton, you say you have special rights in your neighborhood; I have special rights in my neighborhood to do whatever I want in the near abroad? And what will the President respond to that?

SENIOR ADMINISTRATION OFFICIAL: I think the answer is, I don't expect President Yeltsin to frame any kind of proposal in that fashion. I've never heard from a Russian official with us in that fashion, and we certainly don't view the two problems in the two areas as being analogous.

Q What is the U.S. position on Russian peacekeeping in that area?

SENIOR ADMINISTRATION OFFICIAL: Well, I guess there are a couple of pieces to the answer. One is to put something out of the way right at the beginning. We don't accept the concept of spheres of influence, something that is very current around this town, but I can tell you flat out that it is not something that we consider to be in the vocabulary.

What we do expect is that any peacekeeping that is undertaken, should be undertaken in accordance with the U.N. Charter and the various international norms that are in place that we believe appropriate to govern such activities. That includes some of the principles to which the Russians themselves subscribed last -- I think in 1993 in Rome. It involved such things a respect for the sovereignty and integrity of the countries concerned, their consent to have the peacekeeping conducted. And so I don't have the list in front of me, but it fundamentally is involved with those things.

Q What happens --

SENIOR ADMINISTRATION OFFICIAL: But let me just finish. I think the fundamental point here is that our policy has been from the very outset designed and meant to stress our very serious support for the integrity and sovereignty of the states of the former Soviet Union. And that is sort of the basic principle from which we begin. And we would expect that any peacekeeping undertaken by anybody, whether it's Russia or any other institutions, will be consistent with that principle.

Q What does it mean to lower the warheads? Does it mean that they will destroy them, or that they will sell them to other countries?

SENIOR ADMINISTRATION OFFICIAL: Well, I certainly believe and devoutly hope not the latter. The work that we will be launching on will be really to focus on ensuring that once warheads are taken apart -- and both sides are steadily now taking apart warheads, because we built up to numbers of 25,000 or so in each country during the course of the Cold War -- so we're steadily taking those numbers down. Those are strategic and tactical warheads.

And the point of the work -- the negotiations I spoke of is to ensure that once those warheads are taken apart and really all you have left are the fissile materials that you have to then deal with but to make sure that that process is then irreversible; and that that irreversibility is completely transparent to us, and that our situation is transparent to them and that our situation is transparent to them.

Q Some other country, then?

SENIOR ADMINISTRATION OFFICIAL: No, no. That is the point, that we'll be able to have a clear view that that does not happen.

Q You've mentioned that there will be a signing ceremony. Can you give us some idea of what the documents are they're going to be signing?

SENIOR ADMINISTRATION OFFICIAL: Yes. I expect that the two Presidents will sign two documents. And I said before that we view this summit to be about the future of the relationship. The economic -- they will sign an economic statement that we would describe as a partnership agreement, and that would try to set out what our relationship should be and what it should look like in the next 10 years, that has everything to do with market access, with lowering barriers to trade on both sides, not just in the United States, but in Russia as well; with providing the types of incentives and the foundation for businesses to trade and invest -- that kind of thing. And there will be a similar document on the security side that talks about the issues that my colleague described for you.

I think it's likely that they will also, then, witness the signing of a couple of economic agreements, specifically trade agreements and investment agreements -- business deals -- some of which could be quite major and among the largest deals ever signed.

Q Would you be kind enough to address this idea the Russians are floating, the -- which the Americans on one side, the Russians on the other, and the Europeans in the middle as a model to our -- to be integrated?

SENIOR ADMINISTRATION OFFICIAL: You mean the question you addressed to --

Q Can you please -- let him finish his sentence.

SENIOR ADMINISTRATION OFFICIAL: Okay. Among those business deals that will be signed will be at least one, possibly two that OPIC, the Overseas Private Investment Corporation has been involved with in providing guarantees on investment deals.

You know, there are lots and lots of things that we could have signed at a signing ceremony. There are lots of different agreements in different areas. We are choosing to highlight trade and investment, because, again, I think you've heard us say this for many months now -- the ability of the IMF and the World Bank and the United States and Germany and Japan to provide short-term assistance is quite substantial.

But the long-term capital is going to fuel a reform revolution in Russia can only be provided by the private sector, and Ambassador Simons is leading the effort in the U.S. government to reorient our assistance program so that more of our money goes in the trade and investment. In fact, if you'd like him to say a few words, I'm sure he'd be glad to.

Q Could you fill in a little more than the word "security"? Could you give a couple of details about what's going to be signed?

SENIOR ADMINISTRATION OFFICIAL: We're going to have my colleague do that for you.

SENIOR ADMINISTRATION OFFICIAL: In the security statement, we will, as I said, be focusing on some particular things -- launching a mandate for new negotiations to begin this winter at the start of the new year on this, as I said, the problem of the stockpiles, the fissile materials and warheads, making sure that the process of taking warheads apart is irreversible. So that will be number one.

There will also be a particular agreement that looks at improving our overall understanding of the safety and security situation in each country, and exchanging information about how we do safety and security at our nuclear facilities, so that will also be part of it.

Then, as I said, we are focusing on some particular projects and getting those off the ground. Some of these we've been talking about for some time, like the fissile material storage facility, like the material control and accounting projects where we are looking at working with the Russians on after they've done a quick survey of some of their facilities and seen what the problems are, then we'll work together on putting together what we call a "quick fix" -- a package of equipment and software if it's computers to do better accounting, that type of thing -- in order to then quickly move to upgrade the quality at some of their facilities.

Q Will there be any language in the security agreement, or will there be any discussion in the course of the summit of the clarification of the ABM Treaty?

SENIOR ADMINISTRATION OFFICIAL: That will certainly be part; yes, indeed, that will indeed be part of the security statement. And the whole issue of ABM-TMD demarkation, is that what you're talking about?

Q Theater missile defense.


Q What is it?

SENIOR ADMINISTRATION OFFICIAL: ABM-TMD demarkation. This is the line between strategic and tactic -- Theater Ballistic Missile Defenses, and how that is defined.

Q Are the current negotiations -- will they be completed in time to actually encompass them or comprise them in the agreement?

SENIOR ADMINISTRATION OFFICIAL: The Presidents will actually instruct their negotiators to get it finished in the next round of these ongoing negotiations.

Q But not in time for next week?

SENIOR ADMINISTRATION OFFICIAL: Not in time for the summit, no.

Q Will the summit take the position on revising the ABM Treaty and/or any perceived need for defenses against short-range missiles?

SENIOR ADMINISTRATION OFFICIAL: The issue that will be the focal point of discussion on this question at the summit will be this demarkation question.

Q Well, I mean, as it applies to the treaty?

SENIOR ADMINISTRATION OFFICIAL: Yes, and reconfirming the overall integrity of the treaty.

Q The U.S. is going to reaffirm its faith in the treaty.


Q And does this turn on this issue of the ranges -- when you say demarkation, you're referring to range and you're also referring to --


Q Closing speeds, kilometers-per-second.


Q Is that going to resolve --

SENIOR ADMINISTRATION OFFICIAL: But that won't be in the statement. This is something the President will sign.

Q Is that going to resolve -- is the hope to resolve the problems over the ABM Treaty, basically -- the ABM-TMD talks?

             SENIOR ADMINISTRATION OFFICIAL:  Yes, the Presidents --
             Q       which precludes the need to revise the ABM 



Q A quick question. You mentioned the question of Ukraine will be discussed between the two Presidents -- Russia's role in helping Ukraine with the economy. How does the United States view that? How do you look at a movement in Ukraine to forge closer ties with Russia? And then there's the question of Ukraine's debt to Russia -- are you going to recommend that Russia forgive this monumental debt between some of the major companies there?

SENIOR ADMINISTRATION OFFICIAL: I think we can all speak to it, we can all say something about it. We encourage close ties, economic ties, between Ukraine and Russia. There is no alternative to those ties, because Ukraine cannot reform its economy and go through a very difficult transition period without retaining the close trade ties, the people-to-people ties, the company ties that currently exist, and have existed for several hundred years between those two societies. So we have nothing against it; in fact, we encourage it.

We've been very impressed by the degree to which President Yeltsin has supported stability in Ukraine. He has consciously not taken advantage of some of the crises -- the Black Sea Fleet and Crimean crises -- and has acted, I think, by design to try to help Ukraine, both President Kravchuk and now President Kuchma, through their problems.

SENIOR ADMINISTRATION OFFICIAL: Well, I don't think I can add too much to that. I think we simply wish to open the dialogue with President Yeltsin and to suggest that we believe that Russia, playing whatever role it will believe it can, in support of Ukraine's economic reform is going to be very much in the interest of Russia as much as it will be of Ukraine; and that we would like him to be thinking about that, and we would like to hear whatever views he may have on that.

Now, I don't think we can be very much more precise than that because we haven't seen what a Ukraine reform program is going to look like, and one is not in place. But I think it is still not a misplaced idea that we point out -- and my colleague can perhaps address the specifics -- that in Naples, the G-7, if you will, sort of pledged that in the event of a substantial reform effort by Ukraine, the international financial institutions will be prepared to support it.

Similarly, my colleague will explain, we have reserved substantial amounts of support in the event we can put it to use in support of reform in Ukraine.

And I think the only point I was trying to make is that we will be looking, now that this seems to be something that may in fact take place, to the Russian side to think about what it can do, given its very heavy economic involvement with Ukraine, in support of reform, as well. But let me ask my colleague to talk about what we've got.

SENIOR ADMINISTRATION OFFICIAL: Yes. As in every country, our assistance program is intended to support independence, democracy and prosperity. Also in Ukraine -- our commitment to Ukraine at this point is our fourth largest aid commitment in the world. But because we believe that democracy and prosperity are linked, they are going to require market reform, most of this is not spent. But what you have between the commitment made during the visit of March of 1994 and what we are putting into this year's funding, which we are allocating now, only for economic assistance -- not counting Nunn-Lugar -- in other words, the safe and secure dismantlement, the strict security assistance, is about half a billion dollars available to Ukraine in bilateral assistance, but most of it is predicated on reform.

Now, we get mixed signals, admittedly, from Ukraine -- President Kuchma was supposed to give a speech yesterday, which has been postponed -- but also, on balance, I think, encouraging signals about the Ukrainian leadership's realization that reform is necessary and that they mean to go forward.

Q Is the President going to sign a determination making annual Jackson-Vanik waivers automatic?

SENIOR ADMINISTRATION OFFICIAL: Actually, I would like to respond to this. I'd like to give Ambassador Simons the opportunity to describe a major initiative that the President is going to put forward with Yeltsin next week on trade and investment.

The President has decided that Russia is in compliance with the Jackson-Vanik provisions. That means that we think that Russia's record on immigration, both Jewish immigration and Christian immigration -- they're both at issue -- is very fine and meets international standards. That means that Russia -- the United States will no longer be in the position of having to choose every May and June whether or not we should waive Russia's noncompliance, because now we think they are in compliance. It's a big step, it means that we are separating in our own minds and with the Russians, Russia from a communist past, and it is, I think, a recognition that the Russian government has had a very fine record on Jewish and Christian issues.

I would note that the two major American Jewish organizations that are involved in these issues have both come out this week to support that action.

Q Has he actually signed the document, or are they going to do that --

SENIOR ADMINISTRATION OFFICIAL: What he does -- technically, what he does is sign a letter to the congressional leadership, telling them that he finds that they are in compliance and no longer need to be subject to the annual waiver requirement.

But I'd like -- if possible, if Ambassador Simons could just say a few words about our trade and investment position.

Q Is that going to happen today?

SENIOR ADMINISTRATION OFFICIAL: That happened today. That letter has been sent up to the Hill.

SENIOR ADMINISTRATION OFFICIAL: Yes, just because numbers are involved and it'll be good to have them in your heads, as my colleague said, the assistance program is no longer the centerpiece. The theme in terms of economic relations will be trade and investment, because both sides agree that economic relations, over the long term, have to be based on private sector engagement

But assistance will figure in the summit in two ways. First, we will be announcing a new emphasis on direct support of U.S. trade and investment through enhanced funding for programs by OPIC, TDA and the Department of Commerce.

Now, it's not as if we haven't funded trade and investment in the past, but you have to remember that the budget has been reduced from $2.5 billion in FY '94 down to $850 million for FY '95. So the $100 million in funding available is composed of the following pieces: $10 million from $4 million from TDA from their own appropriations. That leaves $86 million -- $9 million to the Department of Commerce for their direct support program, which is American business centers, the SABIT Business Internships, the Business Service which serviced 40,000 American firms last year, interested in doing business there, programs of that sort. And $77 million to OPIC and TDA, $60 million to OPIC and $17 million to TDA. That's what the $100 million will mean.

We think that it will produce well over $1 billion in new U.S. investment in the area. The total private foreign investment in Russia now is about $6 billion to $7 billion. the U.S. portion is $1 billion. This initiative ought to double that.

The second assistance piece has to do with crime and corruption. We are putting together and will announce a package -- it's not completely tinkered out yet -- of assistance from the assistance program for two main purposes: First, criminal justice reform -- in other words, trying to put in place the laws, the institutions, the judiciary, the infrastructure of a judicial and legal system which can combat crime and corruption. Second, a program for cooperation and training in the law enforcement area through the Departments of Justice and Treasury and their ancillary agencies.

The sum total of it will be -- third, the kinds of rule of law activities not specifically focused on crime and corruption, but which are needed for the whole infrastructure -- jury trials, that kind of thing.

The total will be roughly $30 million. So wait for it.

Q This money comes from where?


Q This money is transferred --

SENIOR ADMINISTRATION OFFICIAL: It comes out of Freedom Support Act funds.

Q For this -- which fiscal year?

SENIOR ADMINISTRATION OFFICIAL: For '95. Yes, the one we are allocating now.

Q I want to ask you about the Partnership for Peace in NATO that was mentioned really just in passing. And I'm wondering how the President can do more than -- than basically reaffirm support for them without going into Visegrad states, which really appear to have kind of an implied promise of if not parity, actual prominence in this. How can he do anything concrete on this without bringing in the Visegrad states? On the expansion of NATO and other --

SENIOR ADMINISTRATION OFFICIAL: Well, as I tried to suggest, it seems to me there are several things working in parallel here. We want -- we think Partnership for Peace is a program that deserves to be developed and to develop a reality and a program and a life on its own. It was not meant as a substitute for something. And I think that was made quite clear last winter. That it is perhaps a stage for some as they approach the desire to enter NATO. But it is also a program in and of itself.

Similarly, you know I -- I'm not quite sure I understand the question in the sense of -- you know -- picking out one or another group. The point here is, the issue of expanding NATO is a multilateral question. It is not something we will decide. It is something that the alliance will decide. And it will decide it in conjunction with the people who presumably have expressed the interest in becoming a member of NATO. That process has really not begun formally, I mean, in the true sense. It's been discussed, people have talked about it, but in terms of any formal process of making it happen, we are only at a beginning state of that.

There are other institutions in Europe that are going to also be a part of any future structures as well, and those are going to evolve and develop. And what I was trying to suggest is that with President Yeltsin, it is important, I think, for the President to sit down and discuss with him the fact that we see Russia as a part of the future, or of the negotiations and discussions with other Europeans about how the future of European security structures will evolve.

Part of that, however, will be if -- and I think we will make clear -- that we see an expanded NATO at some point and worked out in conjunction with the Alliance as a part of the future. Now, I'm not sure I can be more concrete than that, and I don't think we're looking for any great decisions from this summit about this. But we are looking to begin a discussion and to sort of carry on the dialogue that was begun last fall, actually, on this subject when Secretary Christopher went to Moscow in October.

THE PRESS: Thank you.

END3:15 P.M. EDT