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                     Office of the Press Secretary
                        (Bariloche, Argentina)
For Immediate Release                                   October 18, 1997
                             PRESS BRIEFING
                             Llao Llao Hotel
                           Bariloche, Argentina

10:20 A.M. (L)

MR. STEINBERG: Today, the two Presidents are going to issue a joint statement on their cooperation on environment issues. The most important, from our point of view,is the aspects of the agreement talking about climate change. The President has said from the beginning that the only way to deal with the problem of greenhouse gas emissions is a global solution, because it doesn't matter where carbon emissions come from, they all affect the climate; and that although developed countries now account for the majority of emissions over the next 50 years, the developing countries will soon overtake the developed countries.

So a strategy which only deals with emissions from developed countries won't provide a long-term solution to the problem. And so we've advocated an approach that includes meaningful participation by developing countries, as well as developed.

And the statement that they're going to issue today will have two important elements that deal with the responsibilities of developing countries in a climate change agreement. The first is that they will agree that any meaningful solution to the problem has to address the question of developing countries emissions limits, as well as developed countries. And that means that we will have to have a strategy -- although the specific obligations can be different for developing countries than developed, that in one form or another the overall solution has to address emissions limits for developing countries. And it's very important that Argentina, as a leading developing country, is now accepting this as an important part of the overall strategy.

The second thing that the Argentinean government is agreeing to with President Clinton is the idea of joint implementation for credit. For those of you who were with the President in Costa Rica, this is something that we've been very involved with already in Central America. But the basic concept is that in order have the most cost effective strategy for reducing greenhouse gases, you want to be able to have the reductions come in the places where the cost of reductions are least. And for many developed countries and for firms in developed countries to try to reduce emissions in that country can often be much more expensive than the cost of trying to do it in developing countries, which are now just making their initial investments in productive capacity.

Under a strategy of joint implementation for credit, a firm in the United States could invest in a developing country -- in a more cost efficient power plant or a factory -- and receive credit for the emissions reductions that it would be able to credit in terms of its own obligations. This could have a really significant impact in the overall cost of emissions reductions. It's a strategy that we've already begun to implement in a number of countries; but the concept of using this as part of the overall climate change treaty will have an important impact in making it much more cost effective for American firms to meet any targets that are agreed to.

Q So a U.S. firm could get credits back in the U.S.?

MR. STEINBERG: They get credits in the U.S. for investments they make in emissions reductions in any place, but particularly in developing countries. It's a win-win proposition because the American firms get their reductions at a cheaper cost and the developing countries get the investment and the technology that comes with these.

Q Are you talking tax credit?

MR. STEINBERG: No, it would be credit towards whatever the emissions limits are, whatever the scheme is that's developed in terms of their obligations for emissions limits. So if they were required to reduce by 10 percent, for example, they could get those reductions by the investments in reductions outside the country. It's a more effective way for them to meet those obligations.

Q What bureaucracy is going track this? It's a massive thing to keep data on.

MR. STEINBERG: There are a number of different ways to do this. We're already very much engaged in this with -- there are about 20 projects already engaged. And I think the experience has shown it's a fairly -- I mean, the incentives are for the firms to produce the information that they need in order to get those credits.

Any of these structures, obviously, are part of what's going to be negotiated as part of the Kyoto process. I can't tell you until the negotiations actually come to fruition about what the arrangements would be.

Q Is this the first case of a market for pollution credits, or doesn't that exist already in other --

MR. STEINBERG: There's a market for pollution credits within the United States, for example, in sulphur dioxide emissions. We have an emissions training system.

Q This would be SO2 working for CO2?

Q If you allow people to take credits for things overseas wouldn't that be yet another incentive to move jobs and production overseas?

MR. STEINBERG: No. What it does is it actually could help save jobs and production in the United States, because it would mean the they could meet their emissions targets at a much smaller cost. And so it means that they would not have to incur much more expensive costs in the United States, which could hurt productivity in the United States. So it's a win-win proposition.

Q Is this the firmest the President has ever been on saying there has to be binding limits on developing countries?

MR. STEINBERG: It's always been part of our strategy that developing countries have to be part of it and that in some form or another limitations would have to be accepted for developing countries.

Q Well, would these, in fact, be binding limits on developing countries, the same way they're binding on developed?

MR. STEINBERG: The same way -- I mean, they wouldn't necessarily be the same obligations. We recognize, as the President has said, that we're not asking developing countries to do it necessarily at the same pace or at the same amount -- but in some form or another there would have to be a sense that it was not open-ended for developing countries while developed countries are taking on those obligations.

Q The Argentine part of this deal is essentially that they have to agree to take the foreign investment, no?

MR. STEINBERG: Well, what we're looking for them is to be a partner for us as part of the Kyoto negotiations in trying to develop a strategy for including developing countries in the overall climate change regime.

Q Jim, isn't it likely that some countries, especially in Europe, are going to say this is a way for the U.S. to shirk its responsibilities by passing the buck to third world countries, to other countries, not to make the drastic cuts in the U.S.?

MR. STEINBERG: The importance for everybody is to find the most cost effective way to get meaningful reductions in emissions. And I think it's in everyone's interest to see this happen this way.

The Europeans are, in effect, asking to do the same things themselves, because the European Union is proposing that they get to do their emissions reductions by a bubble, which means that there would be one level for all of the European Union and that they're going to allow the poorer countries in Europe to get the benefit of all these things -- like Portugal for example, under the bubble concept would benefit and get the same kind of treatment that we're talking about here.

So, in effect, the EU bubble is a mini-version of what we're talking about here in involving developing countries. They implicitly want to get the same kind of deal. And that shows that they understand why it's in the interest to be able to have this kind of flexibility -- the ability to trade, the ability to find the most cost effective way. It's in everybody's interest to do it that way.

Q -- sided with them already?

MR. STEINBERG: We're having discussions with all the countries, because it's a strategy --

Q What was their reaction?

MR. STEINBERG: Some are supportive, some are not as supportive.

Q Which ones are and are not?

MR. STEINBERG: You'll have to talk to the Europeans about that.

Q Can I change the subject?

Q One more on this. How much clout does Argentina have? I mean, are they a voice that you think is going to be critical with others in this region?

MR. STEINBERG: I think it's an important voice in the sense that they are a country that's well respected. There is an Argentinean who is leading the negotiations in Bonn -- although this person is not acting just as their government person, I think it shows the importance. Argentina has been active, you'll hear today from some of the speakers, in climate change. It's the first country in the developing world to develop their own climate change action plan. And so that kind of substantive leadership I think will have an impact on the negotiations.

Q Did Brazil and Venezuela give an explanation on why they wouldn't endorse a similar plan on the visit there?

MR. STEINBERG: I think the President had good discussions with both Presidents about these issues. It's something that's going to have to be negotiated. Everybody understands that some of the issues will depend on what the details are. But I think that there's progress on this.

Q Why didn't Brazil and Venezuela sign on to this?

MR. STEINBERG: Again, this is something that we're in negotiations. The developing countries have to understand and have to feel comfortable with what their obligations are going to be. But what we're trying to do is develop some momentum so people understand the need to move this forward, and the understanding that we cannot solve the problem unless these countries participate.

Q Argentina was more amenable was just because they have a higher per capita?

MR. STEINBERG: I can't speculate on that.

Q And when are we going to see numbers, Jim? When is our side going the start talking specific numbers?

MR. STEINBERG: The President has indicated that he wants to announce his plan during the course of the Bonn negotiations. And I would expect that we probably will have something specific to say next week.

MR. MCCURRY: Other subjects.

Q Wait a minute. On target dates and numbers both, on level of admissions and target dates?

MR. STEINBERG: I'm not going to try to pre-figure the specifics of what the President is going to announce, but I expect we'll have that next week.

Q A New York Times story says that administration officials are on their way to China, that China is ready to sign -- own deal not to help Iran with nuclear technology. Are administration officials on their way to China? Is China ready to make this deal in advance of Jiang Zemin's visit?

MR. STEINBERG: We've obviously been having intensive discussions with the Chinese on a number of issues prior to the upcoming summit. We do have some officials who are going to discuss a range of non-proliferation related issues with the Chinese.

Q What administration officials are on their way?

MR. STEINBERG: Middle level negotiating.

Q Middle level State? Middle level NSC?

MR. STEINBERG: It's a team from several agencies.

Q Is the U.S. hopeful, or has the U.S. received signals from China that China is now ready not to help Iran with nuclear technology?

MR. STEINBERG: This is something we've been discussing in detail with them. We've been making some progress on those issues, but we hope that we can continue to make more progress.

MR. MCCURRY: They're sensitive to our concerns.

Q But you eventually are hopeful that China is ready to send some signals before the visit?

MR. STEINBERG: I think let's just see what they come up with in these discussions.

Q What about Sikorski helicopters and computers? Would that be a part of something that you'd be discussing with lifting the ban with the Chinese, as well?

MR. STEINBERG: The team that's out there is discussing non-proliferation related issues.

MR. MCCURRY: Okay. Other subjects.

Q What can you say about this Radovan Karadzic TV station that's gone off the air today?

MR. STEINBERG: Well, as you know, for some time the United States and SFOR has been concerned about the misuse of the media by the Serbs in Pale. As a result of their failure to live up to their commitments, SFOR several weeks ago arranged to, in effect, gain control of those transmitters and to make sure that the only access was going to be for those people who were prepared to use it in a responsible way and was not going to either endanger SFOR or undermine the Dayton Agreements. And both the high representative and SFOR have been working to make sure that that takes place.

We were concerned by efforts by the Serbs in Pale to try to circumvent that by the use of pirate transmitters, and the higher-up in SFOR are working to try to address that question.

Q Jim, what's the status of the Federal Maritime Commission's dispute with Japan?

MR. STEINBERG: I don't have the specific details out here. My understanding is that -- well, there is certainly significant progress on the underlying substantive negotiations. The Federal Maritime Commission has not forwarded any order at this point to the Transportation Department. But there may be more going on today that I just haven't checked on.

Q -- progress on the fines?

MR. STEINBERG: On the underlying agreement, the underlying port dispute.

Q Can you speak to that, Mike?

MR. MCCURRY: No, no. It's the same as Jim, that they have made significant progress and there has been, in principle, some significant headway on it. But the key thing is that the Commission has not forwarded the Transportation Department any notice of decision that would require any enforcement action. And that gives the negotiators time to complete whatever discussions they have underway.

Q Isn't that a subject that if we wanted to cover we'd have to get on a plane and go back to Washington? (Laughter.)

MR. MCCURRY: You've got it. You got that one right, Bubba. (Laughter.) That's where the action will happen.

Let me do a couple of other points. The Presidents had an exceptionally warm and productive dinner last night. It was more focused on a bigger picture discussion of the bilateral relationship, and time for them to both socialize and deepen their personal relationship. They discussed a little bit the announcement they'll make today.

They will have a variety of recreation this afternoon. I think President Clinton and President Menem plan to play golf. The President was talking about going out horseback riding at some point, so he might do that, as well.

Q Are they going to let him?

MR. MCCURRY: Apparently it's all right for him to do it and the docs have said it's all right. But it's still not clear whether that's going to happen or not because of time.

Q Mike, we noticed in the interview with the Argentine reporters, in the transcript, that the President said he wants to reorganize the entire world. What does that mean? (Laughter.)

MR. MCCURRY: The President's thinking very ambitious after the all the success we've had on this trip. So he's thinking in large geopolitical terms. (Laughter.)

Q He said he wants a new system for human beings to operate in. (Laughter.)

Q Will black helicopters be involved? (Laughter.)

MR. MCCURRY: No. Look, what he was doing was giving them a sense of the world view which motivates a lot of the work we're doing to update and modernize the institutions of the post Cold War era. He talked about -- it was interesting, on the issue of press freedoms or deepening the institutions of civil society, he talked about the role that organizations like OSCE play, like OAS plays. I thought there was a lot of meat and substance that went into his explanation to these journalists of how the issue of trade fits into a larger context of the political, cultural and economic changes that are occurring in this hemisphere.

Okay. What else? Anything else? We're not briefing down in the filing center today, because I think pretty much people are wrapping up early with early deadlines.

Q Is there going to be a press conference after this, or not? Will they answer any questions?

MR. MCCURRY: No. I don't anticipate that, no. Because that would require too much work on such a beautiful day. (Laughter.) All right, everybody, have a good time.

END 10:35 A.M. (L)