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THE WHITE HOUSE

                    Office of the Press Secretary
                        (Birmingham, England)
________________________________________________________________________
For Immediate Release                                       May 16, 1998

                           PRESS BRIEFING BY 
                AND NATIONAL SECURITY ADVISOR SANDY BERGER
               AND DEPUTY ASSISTANT SECRETARY OF STATE FOR 
           INTERNATIONAL CRIME, NARCOTICS, AND LAW ENFORCEMENT 
                            JONATHAN WINER 
        
                            Metropole Hotel
                          Birmingham, England

3:15 P.M. (L)

MR. MCCURRY: Tony Blair is hoping that they carry goals to Newcastle today. They don't get that. They don't even know what I'm talking about. It's not summit, it's FA Cup Soccer.

Good afternoon, everybody. Our goal right now, since many people have got early deadlines for Sunday, is to brief on today and then give you, aside from the social color aspects of the summit this evening, pretty much we'll give you what you need to complete your reporting for the day, because we don't believe there's going to be much going on beyond what we tell you now that we'll be able to share in any event.

National Security Advisor Sandy Berger will talk a little bit, just kind of place the conversations today at the summit and look ahead a bit to some of the things we'll be doing in the coming days. And I've asked the Deputy Assistant Secretary of State for International Crime, Narcotics, and Law Enforcement, Jonathan Winer, who is probably our government's foremost expert on international cooperation in the fight against drugs and the new types of international crime that the President has talked about a lot -- he is here with us to talk about one segment of the G-8 communique which is being released today, which is the portion that is entitled, "Combatting Drugs and International Crime." And we have that summit language, will be available shortly, we believe -- correct? Shortly. So Sandy will start first, and then Jon Winer.

MR. BERGER: Let me try to put the last few days in a little bit of context and review it, including today, and then ask Jonathan to talk about I think perhaps the central, or in many ways, the most important part of the work today.

These summits, this now being our sixth, are always a combination of both focusing on the immediate issues that are at hand, as well as looking long-term at the challenges that are down the road where the leaders can launch initiatives that later come to fruition.

In terms of the immediate issues, obviously you got some of this last night from Jim, but we were very pleased by the political statement that was issued last night by the leaders. If you saw a certain similarity between the language, for example, on Indonesia and what the President had said earlier to you all, it's not coincidental. I think it was an important step in getting the leaders to say -- to call for President Soeharto not only to stay on the path of economic reform, but also to reach out in the political dialogue for political reform in order to restore stability.

On Kosovo, we were pleased, obviously, by the developments this week in which, for the first time, President Milosevic and Mr. Rugova have met and have launched a process which hopefully can lead to a end of the violence and a peaceful resolution. It's obviously just a first step.

On Bosnia, I perhaps most vividly remember previous summits happening almost invariably in the midst of an assault on Sbrenica or Sarajevo, or some other location, and the summits being dominated by Bosnia. I'm quite pleased that the summit declaration was able today to welcome the extraordinary progress that's taken place in Bosnia over the last year.

The Middle East peace process section of the statement yesterday lends support to the efforts that are underway under U.S. leadership. Secretary Albright and Ambassador Ross continue to meet with Prime Minister Netanyahu in Washington -- at least they were late into the night.

And on India, we are pleased that the strong statement condemning the Indian tests and calling for restraint, calling upon them to join the CTBT, and indicating that this would have an effect on the dealings of each country with India.

So that's the short-term set of issues. The longer-term set of issues previously -- more in the planning stage than the immediate issues, where obviously one can't know what's going to be swirling at the moment of a summit -- really fall into three categories.

Larry Summers, Gene Sperling, I believe briefed you yesterday on the steps taken on international financial institution reform. Today, there is a discussion of integrating all people and all nations and all areas of the world into the global economy, with a particular emphasis on Africa. This is something we pushed very hard, particularly since the President's trip, with the support of President Chirac, to put Africa more centrally on the radar screen of the G-8. And there's a commitment, you'll see, in the communique of the G-8 to assist Africa in 100 percent -- having all African children receive primary education as a goal, and also dramatically decreasing child and maternal mortality rates.

Third, there are what you might call -- I guess what I call -- you can call it anything you want -- common challenges. That is, things that are issues that these leaders face day to day in their own context, but they're the same issue. This is something the President has pushed for the last three or four years -- to get the summit not only to talk about classic foreign policy and international economic issues, but also things where all of them from various vantage points are trying to come to grips with the same set of issues. And what they'll be talking about today is jobs, employability, how do you create jobs in a mature industrial economy in the last part of the 20th century.

There's obviously an enormous degree of interest in how we have done it. And we'll be talking about the EITC and welfare to work, which now is something, a program that is also in place here in England.

Fourth, our global challenges, that is, those issues which really can only be dealt with by common action. And Mr. Winer is going to speak in a minute about the centerpiece of what they are going to talk about today, which is international crime.

And, finally, under the area of global challenges is climate change, and there will be a discussion later about how you go from Kyoto to both implement the developed country commitments and also draw the developing countries into a process of global emissions control -- the last overlay here on this verbal chart, verbal graph.

I think one way to look at these summits is not as snapshots as much as moving pictures, and that you begin in one summit, you plant -- now I'm going to mix a metaphor, I guess --you plant a tree in one summit and you then harvest it perhaps in the next or later. And just to give you a sense of that, the financial institutions' discussion that really is going to -- resulted in a number of steps that were taken here yesterday -- or discussed here yesterday -- really began in Naples and was the centerpiece of a process that was begun in Halifax two years ago.

The international criminal cooperation, that Jonathan is going to talk about really began in Lyon. If you remember, the Lyon Summit came about two weeks after Oklahoma City, and we made a decision at that point to try to sort of hijack the summit and convert it into a terrorism crime summit, or at least, if not exclusively, put that on the agenda. And out of that came a set of 40 recommendations that we made and that the summit adopted and which are now actually beginning to result in things on the ground that make a difference in international crime enforcement, as Jonathan will tell you.

And again, this idea of dealing with common challenges -- domestic issues that are similar in all countries -- is something the President began last year in Denver, also around these issues, the economic issues that they're all grappling with. So this is a process, as well as an event, and forces decisions and I think causes the leaders to step up a little bit beyond the day to day and look down the horizon.

I'll answer your questions about this or anything else that I can, but let me ask Jonathan to talk more specifically about the international criminal aspects of this.

DEPUTY ASSISTANT SECRETARY WINER: Thank you very much, Sandy. Historically, governments have not crossed borders, at least not in times of peace. Criminals, of course, as a result of globalization, are crossing borders all the time. What began to happen in the Lyon Summit and what is being essentially fulfilled in this summit is the eight setting up a series of actions to create the ability for governments to transcend borders to fight crime, through coming up with common approaches, common rules, common standards to create law enforcement systems that will be more nearly interoperable with one another than they ever have been in the past.

Now, this morning the heads identified as the principal threats posed by the globalization of crime the following: First, the threat posed by crime to worldwide computer systems and telecommunication systems; secondly, the threat posted by money laundering and financial crime to financial and political systems; third, the threat posed by corruption to rule of law and governance; fourth, the impact of firearms trafficking and trafficking in human beings on societies. There was consensus that all of these problems needed to be addressed by continued joint efforts by the eight. I would emphasize continued, because there has been a series of actions that have been undertaken over the last several years already.

Among the points made by the heads were the following: First, governments need to have the technical capabilities to respond to transnational high-tech crime. And such capabilities need to be as universal as the criminal's ability to use high-tech to commit crimes. Being able to collect evidence of high-tech crimes and to share that evidence with one another, regardless of where the evidence happens to be located, and regardless of where the crime has taken place, and regardless of where the victims are, is going to be essential. And this has to be done in balance with respecting personal privacy.

Second, on the issue of money laundering, money laundering and financial crime the heads said requires constant updating of domestic legislation. It also requires combatting it -- international standards and approaches, because of the trans border and global nature of money laundering and financial crime. This is especially true in the area and the growing potential threat posed by off-shore financial centers. International cooperation against transborder financial crime, asset forfeiture of the proceeds of criminal activity, and a focus on eliminating safe havens are all critical elements of a response.

On the issue of corruption, the heads noted that criminals have the resources to corrupt law enforcement officials in many countries. Too often, the bribes they offer dwarf the official salaries of officials. Further international efforts to develop regimes and implementation of strategies to combat corruption are urgently needed.

Fourth, the smuggling of firearms and human beings by criminal organizations has become an increased problem, requiring increased cooperation and definitive international standards.

Finally, on the issue of crime, the U.N. convention under negotiation within the U.N. system with a goal of completion by the year 2000 can provide an effective means of combatting many of these problems. This convention will criminalize many of these offenses and provide universal norms for cooperating against them through agreed-upon tools. It potentially has a value and impact of the 1988 convention against psychotropic drugs that was negotiated in Vienna, which since has become a universal standard for combatting narcotics.

On the issue of drugs, the heads took up the issue of decriminalization and expressed their strong views against moves towards decriminalization, their opposition to decriminalization, and their desire to oppose that, if it is raised in the context of the U.N. General Assembly Special Session on drugs next month. They endorsed the notion of shared responsibility for combatting narcotics, of the need for a global strategy, and cooperative efforts focused on both eradication and demand reduction.

That essentially summarizes the discussion that they had this morning.

Now, within the communique itself, there are half a dozen -- eight or nine different points which track more or less the discussion they had this morning. And let me summarize them for you, if I might.

The first agreement that they reached is to fully support efforts to negotiate within the next two years an effective U.N. convention against transnational organized crime that will provide law enforcement authorities with the additional tools they need. Again, I would compare this to the effort that took place a decade ago, vis a vis drugs, which essentially established for the first time a comprehensive international regime involving all nations to begin to take a series of steps to combat drugs.

The second thing they agreed to was to implement rapidly the 10 principles and 10-point action plan agreed by our Ministers in December -- justice and interior ministers in Washington on high-tech crime. One very important aspect of this is they call for close cooperation with industry to reach agreement on a legal framework for obtaining, presenting, and preserving electronic data as evidence, while maintaining appropriate privacy protection; and agreements on sharing evidence of those crimes with international partners. Essentially what is contemplated is global agreement on standards for capturing information, retaining information, and sharing information to deal with transnational high-tech crime.

These principles, the heads will state in the communique, will help us combat a wide range of crime, including abuse of the Internet and other new techniques.

In the money laundering area, the communique will welcome the decision by the financial action task force based in Paris to continue and enlarge its work to combat money laundering in partnership with regional groupings. We will consider high-level meetings to discuss further efforts to combat transnational crime with special emphasis on money laundering and financial crime.

The communique also agrees on further principles and actions to facilitate asset confiscation as a means of transferring funds from the criminals to governments, disrupting their criminal enterprises and increasing the resources of those who are seeking to combat their illicit activities.

On the issue of trafficking in human beings, the communique specifies the particular importance of combatting trafficking in women and children, including the requirement that the eight get together to develope a program to prevent trafficking in women and children, to protect victims, and to prosecute traffickers.

The eight, will, as a result, be developing a multidisciplinary and comprehensive strategy to deal with increasing global problems. This will include principles and an action plan for future cooperation, not only among the eight, but involving third countries, including countries of origin, transit, and destination. The U.N. Convention on Transnational Organized Crime will be one of the mechanisms by which this is accomplished.

The communique endorses -- further endorses some joint law enforcement activities that are already taking place among the eight, which are focused on particular kinds of groups and criminal targets and which we expect will show results in the days, months, and years to come.

They also are endorsing the elaboration of a binding international legal instrument in the context of the U.N. International Organized Crime Convention to combat illegal manufacturing and trafficking of firearms -- a binding international instrument to deal with illicit smuggling of firearms.

They welcomed the work of the environmental ministers to combat environmental crime, and on drugs, essentially emphasized the link between drugs, international crime and domestic crime; welcomed the U.N. General Assembly special session on drugs, and sought reinforced cooperation to curb trafficking in drugs, chemical precursors, action to reduce demand, and support for a global approach to eradicating illicit drugs.

That is essentially what is in the communique language.

Q With regard to the crime part of the communique, there was supposed to be a 24-hour hotline linking the law enforcement agencies of the eight. Is that in part of this mix?

DEPUTY ASSISTANT SECRETARY WINER: It was endorsed by the ministers as being implemented already. There are points of contact that have been established among the eight and exchanged among the eight. Essentially, the commitment is to have somebody available 24 hours a day, seven days a week, to be able to respond to a case of high-tech crime.

So if you're in the United States or Russia or the United Kingdom or Japan, you've got one number, you know who to call; that person is available no matter what the time of day is, with a beeper or something and can respond. That way each of the countries will have in place the ability to immediately push for the freezing of information, so the information does not get destroyed. Or if there's money involved, the holding of assets before they can be transferred from one country to another.

An important case on this was the Citibank case several years ago, when a fellow named Vladimir Levin in St. Petersburg, Russia, essentially got involved in moving millions of dollars of Citibank's money around. Now, as a result of cooperation between the United States, Russia and the United Kingdom, among other countries, he was arrested, indicted, prosecuted, convicted, and all but $400,000 of the money was grabbed. But what's interesting is, is to this day, all those governments involved, $400,000 of that money remains missing. It moved so quickly that it was not, in fact, traceable. And that reflects the fact that there have been gaps which still need to be filled, and we are in the process of doing that through this mechanism.

And this is not the only mechanism -- we're cooperating with the Council of Europe which is trying to also develop some standard rules. But the notion here is we have to push very rapidly now to create an international network for governments to be able to respond to high-tech crime that's as comprehensive as the Net is and our international financial systems are themselves.

We're making a lot of progress in that area. To get all the way is going to be absolutely essential to have cooperation with industry. And the communique language explicitly calls for that. We've begun some of that already informally; that's going to intensify rapidly over the next year.

Q Where does it leave Interpol?

WINER: We're working and talking with Interpol. Interpol is a means of getting information in real time on particular criminals. When you're trying to track down a criminal or get information that is in somebody's law enforcement database, that's what Interpol is used for. Now, we're not necessarily talking here about a law enforcement database, we're talking about the need to find information that's located somewhere in a server in somebody's national territory.

Q You're talking about back-door to encryption then?

DEPUTY ASSISTANT SECRETARY WINER: No, we are not. We certainly are not. What we are talking about is the ability to trap and trace information, not to be able to read the information without permission. We're talking about developing a universal system where when a crime has taken place, a government can ask another government for cooperation and industries have agreed to retain information for a certain amount of time.

In the same way that today, if you were committing a crime in the United States, you would be able to freeze that information and get a search warrant and be able to go after it. We're talking about trying to create an international system that allows for legal searches in a reasonable way to preserve evidence of a crime.

Q Sandy, Pakistan says that the G-8 response to India's tests was very weak and they say that they're going to do what is in their own national interest. How do you respond to their complaints?

MR. BERGER: Well, I have not seen that -- I take it there's a letter -- I have not seen it. First of all, I think the statement of the eight is a strong statement, condemning unequivocally, without any hesitation, India's testing, and indicating that it has and will affect the dealings of every one of these countries with India.

In addition, a number of countries have taken actions beyond that -- Japan, Canada, the Dutch, Swedes, the Danes, and I know several other countries, a number of other countries are considering actions.

So, number one, I think this is a strong statement. It is accompanied by actions that have been taken by a number of governments, and hopefully, further actions will be taken. Number two, I hope the Pakistani government will decide that their national interest is better served by not testing than by testing. If they make that decision, I think, as the President indicated, they will capture the high ground in the longstanding regional struggle in South Asia. I think the nature of their relationships with many governments will chance. I suspect the attitude in our own Congress, which has been quite restrictive with respect to Pakistan, would change, which would then free up our capacity to cooperate with them more fully.

And on the other hand, India has isolated itself clearly in the international community on this issue. So as we've said all along, we very much hope the Paks will decide not to take this step.

Q Sandy, Bhutto said that if there is a military capability to eliminate India's nuclear capacity it should be used. Does that exist, and is there any thought being given to doing that?

MR. BERGER: Well, I'm not -- obviously, it would not be appropriate to take military action in this situation.

Q Why not?

MR. BERGER: Why not? Because it would simply escalate into a regional war which would have devastating consequences for both countries. Neither side will win that. Both sides will lose. The Pakistani people will lose and the Indian people will lose. They've had three wars in the last 20 years and they've not gained from any one of them, it seems to me. So I think that is not a wise course of action.

Q Is the reality that when it comes to nuclear proliferation to India or Pakistan, or previously to China, that there's just a limited amount of pressure that the rest of the world can bring to bear, just a limited amount of things we can do to --

MR. BERGER: I think that's not absolutely true. Obviously, countries proceed on the basis of their own perceived self-interest. I think this has much more to do with misguided nationalism on the part of India than national security. But I think that you have to look at this in a slightly wider time frame.

The fact is the world has made enormous progress in the past 10 years in controlling nuclear weapons. Let's start with the principal nuclear relationship, that between the Former Soviet Union, now Russia, and the United States. If the Duma ratifies START II, as we hope it will, nuclear stockpiles will have been reduced two-thirds from the Cold War. And if we get to START III, as I hope we will, we hope to reduce them by 80 percent from where they were. We have had an extension of the Non-Proliferation Treaty which expired and is now extended indefinitely, and 149 nations have signed a treaty that was first proposed by Dwight Eisenhower, which we were able to negotiate, banning nuclear tests. And I think the more nations that sign that treaty, the better, because it will isolate even further those who feel compelled to test.

So, can we control everything that every country does? Of course not. But I think that India is more isolated today than it was before this test. And the general record of nuclear deescalation over the last 10 or 15 years has been quite strong. This is an unfortunate step backwards on that trend.

Q One assumes that this statement, no matter how strong or weak, could have been agreed to by fax. Where is the added value of these guys sitting down and going over this?

MR. BERGER: Well, I think there's been an enormous added value by virtue of the President's conversations with President Chirac, with Prime Minister Hashimoto, with Prime Minister Blair, and others. Not everything is embodied in a joint statement. I mean, I think that the President -- I don't mean that there's a secret codicil here that we haven't shared with you, but I think the strength and persuasiveness with which the President has made the case to these leaders that this is a dangerous step, that it is important to speak out against it, that it's important to publicly and privately oppose it to stop not only Pakistan from testing, but other nations from testing -- there's no question that the level of -- and I've been told this by my counterparts from other delegations -- there is no question that the sense of urgency and concern that is felt by the others has been significantly enhanced by their conversations with the President, who feels this very strongly.

Q The India tests would appear to have undercut your efforts to get the Senate to ratify the Comprehensive Test Ban Treaty. Is that the way you read it?

MR. BERGER: Quite the contrary. I believe that the India tests make all the more compelling the argument for ratifying the treaty as soon as possible for two reasons. Number one, as I said, the more states that sign and ratify this treaty, the more isolated will be the countries, the more outside the norm of international behavior will be countries that seek to test. And our capacity to make that argument persuasively, assigning and ratifying the CTB, is obviously is enhanced if we've not only signed, but ratified.

Number two, the Comprehensive Test Ban Treaty has a number of provisions in its verification provisions which will enhance our capacity to detect activity of this sort. For example, in addition to our own national technical means which we have in any case, this will provide for international censors, will provide for short notice on-site inspections, whether there is suspicious activity. So we will have to verify -- we will have to watch out for these things whether this treaty goes into effect, or not, but this treaty gives us tools to do that which we would not otherwise have.

And I think, third -- even though I said two -- third, there is a moment here in which we have your attention, we have the American people's attention about the dangers of nuclear testing. One thing happened when the Comprehensive Test Ban Treaty was signed. The Comprehensive Test Ban Treaty said the era of nuclear testing should be over. And backsliders, like India, should understand that they are swimming against the tide.

Q Sandy, you talk about the political isolation. Will you consider it a success if you leave Birmingham and all you've got is political isolation and no one else joins to put any additional economic pressure or force any other changes on India's behavior?

MR. BERGER: Well, as I say, a number of -- I read a list of a number of countries that have, including Japan --

Q -- to some extent?

MR. BERGER: To some extent. I hope others will. And I think the strength of this statement is important. And the fact that these countries will make this an issue in their dealings with India is important. And the fact that it has gotten this kind of attention is important. We would have preferred India not to test. We made that clear to India repeatedly since this new government took power. But having done so, I think that it's important over the long-term that it reach the judgment that further testing would be unwise.

Q Sandy, could you actually talk us through the conversations they had today, particularly around crime? What were they actually talking about? Were they just talking about mechanisms and "we endorse this," "we endorse that," "organize this," "organize that"?

MR. BERGER: I'm going to turn it over to my criminal expert. (Laughter.)

DEPUTY ASSISTANT SECRETARY WINER: They literally talked through the six points that I went through a little bit earlier. That is, they themselves focused on the need for governments to be able to have trans-border capabilities to deal with high-tech crime, the need to push through with the development of common standards to combat high-tech crime common mechanisms, and the need to get the private sector to work out with governments ways to get information retained, and so on.

In the area of money laundering and financial crime, they themselves literally talked about the importance of dealing with off-shore havens, making sure that there was no place that was capable of holding on to the proceeds of illicit activity in a nontransparent way that couldn't be reached, and of the need to have some common approaches to it.

On corruption, they talked at some length about the problem of the disparity between the resources available to criminals and the salaries paid officials in a number of countries, and the need to think further about particular steps to take.

Indeed, earlier this week, in the President's international crime strategy, he announced, among other things, a conference within six months headed up by Vice President Gore on precisely this point. But there were a number of other heads who raised this issue and thought that it's a very important issue for further work to be done.

On smuggling of firearms, they specifically agreed there has to be a binding international instrument to deal with the smuggling of firearms. That means obligations of all states to one another, of steps to take against firearms trafficking. Now, this happened last October in the Americas, when the countries who are members of the Organization of American States agreed that no one would export weapons, import weapons, or let weapons transit through their countries unless it was with the permission of all countries involved.

The countries also agreed that they would mark all firearms at import and at manufacture in order that weapons could better be traced. They also agreed to cooperation with one another on tracing firearms. So that kind of system, which literally did not exist anywhere, it has been our domestic law for some time, but didn't exist anywhere -- was endorsed by the OAS and signed by President Zedillo and President Clinton among others, last October is now effectively in the process of being globalized as a result of the action of the eight today.

The communique language basically articulates specific steps that are going to be taken. One of the most important steps that will be taken is the negotiation of a convention against transnational organized crime within the U.N. system in which a number of things that we're doing in our country already, a number of tools that we use to fight organized crime will become universalized.

For example, very few countries have racketeering influenced corrupt organizations laws or conspiracy laws directed against organized crime. Over the past year the European Union has said that EU members must have that. The U.N. instrument to fight organized crime will very likely, certainly, contain the same kind of a requirement for criminalization.

In the area of high-tech, the commitment to work together with the private sector to develop universal rules for retaining information and for being sure that information can be accessed in cases of crime is very important new work.

Q Has President Clinton contacted President Soeharto, and is there anything the United States can do to help bring his government to some kind of better dialogue?

MR. BERGER: Well, I think that President Clinton has spoken to President Soeharto on a number of occasions over the last -- since the financial crisis -- not since this latest political turmoil. I think that -- we started two days ago talking about not only the necessity for President Soeharto to remain on the path of economic reform, but for him to open a dialogue with all his people and engage in political reform so that his people have a sense of buy-in to the kind of economic decisions and circumstances they're going to face.

I think this language now has been embraced by the G-8 so this now becomes more than simply the President's view, it becomes the view of the G-8. And we will continue -- there will be -- I believe, Prime Minister Hashimoto told us that he has an emissary going to Indonesia. We had a long talk with him. So we will continue to stay in contact. We have an extraordinary Ambassador there, Stape Roy, and continue to encourage the Indonesian government at this stage, when the problem is no longer simply economic, but also political, to open up lines of dialogue and engage various elements of their society in a conversation about its future.

Q Are you evacuating dependents?

MR. BERGER: We have a ordered departure of Americans which means nonessential Americans are leaving. I think there will be over the weekend about eight chartered flights with roughly 3,200 Americans leaving. But we will continue, obviously, to operate. There have been no, as far as I'm aware of, no particular incidents involving Americans, but the situation is sufficiently turbulent that Ambassador Roy sought that authority, and Secretary Albright approved it.

Q Sandy, how dangerous a situation will it be if Pakistan follows India's lead and conducts a nuclear test? What's the -- when they let the genie out of the bottle, what happens?

MR. BERGER: Well, it will further escalate the situation that is already tense and has been for some time, really since the beginning of the -- for 50 years in some ways, but certainly in the last 25. There are two arms races that we have been concerned about in the South Asian peninsula -- one is the nuclear arms race; the other is the missile proliferation race. And these things heighten capabilities and with heightened capabilities and heightened tensions you have greater danger.

I would hope that the two countries would realize, whatever their capabilities might be, that any further conflict between them would be a disaster.

Q Quickly on Indonesia. As you know, Soeharto is back-pedaling on many of the key aspects of the course of action for economic policies that have been recommended by the IMF, particularly dual cost. Is the U.S. of the view that that's prudent at this point, or does the U.S. think that he should be sticking to the IMF plan, despite upheaval and evidence of unrest?

MR. BERGER: Let me answer it in two ways. Number one, with respect to any particular action that he might take, it's really a matter for the IMF to evaluate. I would say in the connection with fuel prices, for example, that the IMF -- let's go back and blend my two answers here.

The IMF didn't create the Indonesian economic and political crisis. Indonesia created the economic and political crisis, starting with an economic crisis. The Indonesian economy was collapsing. The International Monetary Fund came in to try to help restore stability and put it on a path back towards growth, but that had to be accompanied with reform. You can't get one without the other. You can't have the candy without some of the medicine.

Now, there have been three revisions of that IMF agreement; each case trying to deal with some of the consequences on the Indonesian people, and it's been accompanied by a good deal of World Bank social safety net loan lending and bilateral aid -- for example, from the United States -- to try to mitigate the impact of this on the Indonesian people. But obviously, there has to be -- the criteria here needs to be what is in the best interest of the Indonesian people, and the best interest of the Indonesian people in our judgment at this stage lies in a combination of a more open political process, political reform, so that they can have a voice in and have some ownership over the decisions that shape these very hard economic choices and decisions that have been brought about by the prior loss of confidence in the Indonesian economy by the international community.

Q You say these hard decisions are unavoidable, but they have to plow ahead with them --

MR. BERGER: I don't want to comment on any particular -- in the fuel area, for example, I know that the there was a much lower increase in kerosene prices which are used by ordinary Indonesians than in fuel oil prices that are used by more wealthy Indonesians. So there's been sensitivity on the part of the IMF to these consequences.

I can't comment knowledgeably on one particular piece of this. I think that there will not be economic reform -- successful economic reform -- without political dialogue, and there will not be long-term political stability unless there is an economic recovery that's going to require some reform measures.

Q Back to India and the statement from last night, you made the argument yourself today repeatedly that as a result of the leaders getting together there is a greater sense of consciousness about it, a greater willingness to at least think that this is a terrible problem. But can you point to anything that any country has done since arriving here, any signals that they have given you in a concrete way that they are prepared to take any further steps that they had not already done before they came to Birmingham?

MR. BERGER: Japan has taken some further steps since it has arrived here and there have been statements made by others indicating that they will go home and look at this very seriously. And Prime Minister Blair called Prime Minister Vajpayee after this and spoke of the dismay of the international community. Your question goes to specific actions and there have been leaders who have indicated that they will go back and look at this more seriously. I mean, obviously, this happened as they are arriving; these are things that one usually does in consultation with your legislature, your parliament, and so it would not have surprised me if there were further actions.

Q Sandy, where has Yeltsin been in all of this? This was finally the G-8, he got the title he wanted. Has he been involved in many of these discussions? Can you go over his performance?

MR. BERGER: My understanding has been that he was supportive of the strong language -- explicitly supportive of the strong language that was used last night condemning the action.

Q Sandy, could you talk about President --

Q Could I just ask another question on Yeltsin? To what extent will the dynamics between Clinton and Yeltsin tomorrow change as a result of this nuclear showdown in South Asia? Do they have more pressure to deliver something on the nuclear front despite being tied up with the Duma and the ratification?

MR. BERGER: No, I don't think -- I'm sure it will be discussed, although -- I mean, they have discussed it, obviously, last night. But there are a number of issues on the agenda between President Yeltsin and President Clinton. There's not much more to say about it, I think, than was said last night, but issues involving the new Russian government, what its direction is, what its priorities are, questions of START II ratification, START III. We have concerns we want to talk to the President about in terms of missile proliferation, or missile technology proliferation. So there's a pretty heavy agenda. This may come up some more, but they have discussed it.

Q Sandy, Congress so far has refused to give Clinton fast track, it's not voting U.N. dues, it's not voting IMF money. The Republicans are saying they're not going to give you ratification of the Test Ban Treaty. How often can Clinton come to these summits or deal with crises like India nuclear testing and not have the tools, the leverage, to deal with these situations?

MR. BERGER: I guess I would say two things. I don't see or sense any diminution either in Santiago or here of the President's authority with these leaders. These leaders clearly see the United States as the dominant economy in the world and as a key leader. And the President's personal partnership with these particular leaders now is very -- quite close and deep. So I don't see any -- in these contexts, I have not seen any evidence of that.

However, having said that, obviously, we need the IMF money, not so much because of the President's authority to persuade someone to use a different adjective on India, but because if this Asian problem spreads, as it well might, we're going to need those resources. And at that point, I think we would look pretty darn foolish if we have not stepped up to the plate.

Similarly on the U.N., if we get to the end of the year, and we wind up having to sit out on Dag Hammarskjold Avenue under a pup tent instead of having our seat in the General Assembly, I think that would be unfortunate. (Laughter.)

Q That might be good pictures, though, we could use. (Laughter.)

Q Sandy, on Northern Ireland --

MR. BERGER: There was a statement on that. I think they issued an additional paragraph -- is that right -- an additional statement on Northern Ireland, which, if you don't have, you should get.

Q It seemed like Prime Minister Blair was trying to go beyond a typical statement of support to some sort of statement that the North would be a more viable investment opportunity. Did he get that done, or can you characterize that --

MR. BERGER: I'm not aware of the statement. I'm actually just heard as I was coming in that there was a statement. I have not read it.

Q Sandy, when do you expect to get a readout from Strobe Talbott on his trip to Pakistan, and when will the President be getting that briefing?

MR. BERGER: Well, we've had reports from the traveling party periodically, last night. And I have generally briefed the President on those reports. An unidentified senior official traveling with Deputy Secretary Talbott had a press conference yesterday, I think, before he left in which he said that the talks have been very good, that he believed that the Pakistani government had not made a decision as of that point, but they had made no commitments.

I suspect that I will see Strobe tonight because of the dinner. I would not expect the President to see him until tomorrow.

Q On Africa, was there any discussion of accelerating or expanding the debt relief initiative? And on the health and education things that you mentioned in the communique, is there any specific commitment to money or aid to that --

MR. BERGER: We have, in the connection with our visit, made specific monetary commitments of fairly significant proportions. I don't think there are dollar figures -- there are not dollar figures associated with the communique, except a commitment to these goals and to take actions necessary to meet them with the Africans.

In terms of the debt, I honestly don't know the answer to that. I would be enormously surprised if it had not come up because I know it was something the President wanted to discuss and others. But I have not gotten -- they're up in the Manor country, and I have not gotten a readout on that.

Q Back to Russia, could you tell us whether there's any stress put on the relationship between the United States and Russia because all the different times when they've taken different views on very important regional issues like Iraq and Kosovo and now sanctions on India? What does this do to the relationship?

MR. BERGER: Well, I think you have to take this into perspective -- that is, here we have in 1998 a democratic Russia undergoing an economic transformation to a market economy with all that entails. It's a remarkable development and we ought not -- just because it happened last week, we ought to not minimize probably the most significant fact of our lifetime.

The President has worked assiduously for almost six years to try to promote that course, democracy -- and President Yeltsin most recently changed his government and put -- which was we thought quite a good government -- but put in its place a group of very young, reform-oriented, pragmatic individuals who clearly are going to move that process even further. So, big picture.

Second of all, there are a lot of things in which we cooperate very well with Russia. Who would have thought that we would be actually serving side-by-side in Bosnia? Who would have thought, including many of you, that we would have been able to enlarge NATO and not somehow destroy our relationship with Russia? We have an arms control agenda with Russia. There are a lot of things -- a lot of business that we do which is of profound significance to the American people.

Now, there are things that we disagree on. We disagree on Saddam Hussein and the extent to which he poses a threat. We disagree on Kosovo to some degree and the extent to which sanctions or harsh measures should be placed on Milosevic. I don't think, certainly I don't expect the Russians to impose sanctions on India.

But I think you have to look at a relationship between two countries such as this, whether it's the United States and Russia, or the United States and Britain, or the United States and France, and see it as a balance sheet that hopefully has more pluses than minuses.

Q So there's no stress on the relationship from these disagreements?

MR. BERGER: National relationships are not psychiatric confrontations, I think, in terms of stress. (Laughter.) I think it is in our national interest to pursue the relationship with Russia. There are a number of places where they see their national interest differently than we do, in part because of where they are, and in part because of their history, in part because of their geostrategic situation. There are areas where we fundamentally disagree with Russia and we will continue -- as we do with China, for example -- but we will continue to maintain the relationship so long as we can make progress on the areas that we agree on and deal candidly with them on the areas we disagree on.

Q Sandy, -- the President's proposed trip to India and Pakistan, has any of it -- on the trip to India and Pakistan, is there any thought of definitively not going or changing that --

MR. BERGER: We have not made any decision to change our plans at this point, but we'll see how that -- I think it's something we just have to consider over a period of time.

Q Was there any discussion among the leaders, or among their senior aides -- someone like yourself -- over whether this group of eight is the right group of eight, whether there are other countries that should be properly represented here?

MR. BERGER: I read my friend, Dan Tarullo, in the Post this morning on the subject. I think the answer is there's an ongoing discussion of the G-7/G-8. I think its role has changed, and I think, actually, President Clinton deserves a good deal of credit for changing its role. It was a meeting that dealt with macroeconomic issues and crises, and we have pushed it towards global issues. We've pushed it to the kinds of issues that Jonathan was talking about, and we've pushed it to deal with what used to be called -- what are domestic issues, but where these seven or eight guys who have the same -- who are dealing every day with the same problems can share information.

So I think substantively, it's changed. There has been discussion over the years as to why these seven, or why these eight. To some degree, it's historical and it goes back now 20 years and a lot of things have changed, but it's one of those Pandora's boxes -- once you open it up, it's a little hard to figure where you draw the line or how you define. And there are plenty of other forums. You know, we meet with nations in the NATO context, we meet with nations in a bilateral context --APEC, the U.S.-EU summit. The only thing I'm against is adding any more summits to the agenda -- any more annual summits. (Laughter.)

Q Sandy, to follow on that, Yeltsin asked Hashimoto yesterday if Moscow could host the G-8 in the year 2000. Did he make that request of the President, and what would be the U.S. response?

MR. BERGER: I think there was some discussion of this last night. As I understand it, Japan, which was already scheduled to be the host for 2000, will, in fact, be the host. But I think there was some desire to find some way to -- I mean, obviously Russia has to get in this rotation, and maybe there are other ways to recognize that. There was, as I will remind you, a special summit in Moscow in '96 on nuclear safety -- better check '96.

Q -- would Russia going into the regular rotation?

MR. BERGER: Yes. But when is hard to -- there's no answer to.

Q A couple of days ago the British environmental minister made some very harsh criticism of the U.S. position on the Kyoto treaty, saying the United States really doesn't want to change its energy behavior and it's going to meet the criteria of the treaty by simply buying up pollution permits from other countries, and that the EU --- and wants at least a 50-percent rule that you've got to change your domestic practices and you can't -- buying up these permits. Did that come up here?

MR. BERGER: There is a discussion this afternoon of climate change. I don't think the British environmental minister will be there, but we'll see whether the Prime Minister raises it.

But let me just say generally that under Kyoto, we are, of course, the largest emitter of greenhouse gases; we are also undertaking the most Draconian cuts. The Europeans are in a kind of privileged position because there's a bubble over the EU. They're dealt with as a unit. And so there are a lot of -- like Eastern Germany, for example, there are a lot of parts of the EU where levels are very low and it's easier for them to meet what is nominally a larger percentage reduction.

So, number one, I think we've bitten the bullet on this. Number two, the idea of engaging the developing world has two purposes from the President's point of view. Number one, this is a global problem, and it requires a global solution. If we cut out all of our global emissions, all of our greenhouse gas emissions, China is growing at such a rate, it will simply be the number one greenhouse gas emitter by 2020 or 2030. The environment -- I mean the globe, the planet -- doesn't really understand where these gases are coming from. They're just going to know that they're increasing. So you have to have some kind of way of getting the developing world to buy in.

The President's view has always been that a trading mechanism, where American industry is essentially able to swap in credits, is a way to get the gasses down -- doesn't matter whether that unit of greenhouse gas is diminished in Thailand or Toledo, from an environmental standpoint -- and at the same time from the developing world's point of view, allows them to take an energy development path towards less polluting energy sources, which is a lot better than the rest of us took in the last 50 years. So I just think he's wrong -- long answer.

Q Sandy, is there any solution that's been made to the F-16 problem for the Pakistanis? And what kind of incentive can you give them besides just saying that they be "good guys," not to blow up a bomb?

MR. BERGER: I think, first of all, the F-16s -- we have been trying for some time to resolve this issue with the Congress. This is a complicated issue where they paid for the F-16s; we still have them. There is reasons for that cutoff, this was not capricious on the part of the Bush administration by any means. But it has resulted in what seems to be an unfairness. We're now making money off the interest on this. When Ambassador Richardson was in Pakistan in the first half of April, he did raise with the Pakistanis some ideas that we have that we think that we could accomplish with the Congress that would resolve this issue. I don't want to discuss them, particularly, publicly.

I do think -- the larger question -- one of the problems we've had in expanding our relationship with Pakistan is the so-called Pressler Amendment, which has cut off virtually all U.S. assistance to Pakistan. A few years ago, with our cooperation, Senator Hank Brown of Colorado amended that to open up some areas of cooperation, but not many. I would have to believe -- and based on some conversations I've had with senators in the last few days -- that if Pakistan were not to test, that we would have a far greater chance to make inroads on the Pressler Amendment in the Congress, in a bipartisan way, than we have had before. And I think that would be a welcomed development.

Q To the end of delivering planes, perhaps?

MR. BERGER: To the end of resolving the plane issue in a way that is satisfactory to Pakistan and the United States.

Q Which could include delivery?

MR. BERGER: Let me leave it where it is. There are a lot of ways to skin the cat and what's important here is it's resolved in a way that they are satisfied with and a way we're satisfied with.

Q Have you found a third country buyer then, Sandy?

MR. BERGER: I don't want to thwart something by speculating on it.

Q Is there anything else beyond rolling back Pressler that you can do for the Pakistanis? Apparently, one editorial in Pakistan said today that they wanted some kind of security guarantees from the U.S.

MR. BERGER: Well, we have a security treaty with Pakistan. Or a security alliance, I guess, it's not a security treaty.

It's not been my sense here that the Paks put a price tag on not testing. This is going to be a decision that they make based upon their own judgment of their national interest. And as I say, I hope that they will do that -- I hope that they will decide that it is in their national interest as we head to the future to be part of the tide of history that is giving up nuclear testing rather than the undercurrent of history reflected by the Indians that seeks to go backwards.

Q Sandy, you said no decision had been made on whether the President will go to India later this year, but could you imagine the President going if India had not yet disavowed any further nuclear testing?

MR. BERGER: I don't want to really speculate beyond what I said. We have not -- in time, we will look at the issue, but no new decision has been made on that.

Q You noted that this was President Clinton's sixth economic summit --

MR. BERGER: Fifth or sixth.

Q I'm not saying that's wrong. I assume that's right.

MR. BERGER: I thought I was wrong when I said it. (Laughter.) Six, yes.

Q I guess that makes him senior to everybody except Kohl. Can you talk about how his role has changed and evolved over those six summits, and kind of how you would express or assess his role --

MR. BERGER: Let me answer it in two ways. I pretty vividly remember the first summit in '93 in Japan when, basically, the international community saw the United States as the international economic problem. We had $200 billion debt; there were no prospects of changing it. We were basically being blamed for all of the economic problems in the world. Today, I think the United States is an economic model. And you see leaders around the world, in many respects, reflecting the President's policies, his approach, his politics.

I think that he is -- in these summits, I've noticed that he's rarely the first to talk unless he asked to. He is listened to, I think, very attentively. He tries to listen to others. And I think he clearly has emerged the dominant figure on the world stage.

THE PRESS: Thank you.

END 4:28 P.M. (L)