[Budget of the United States Government]
[V. Preparing For the 21st Century]
[10. Advancing United States Leadership in the World]
[From the U.S. Government Publishing Office, www.gpo.gov]


 
          10.  ADVANCING UNITED STATES LEADERSHIP IN THE WORLD

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  ``If the history of this American century has taught us anything, it is that we will either work to shape
events, or we will be shaped by them. We cannot be partly in the world. We cannot lead in fits and starts or
only when we believe it suits our short-term interests. We must lead boldly, consistently, without reservation
...Our security and prosperity depend upon our willingness to be involved in the world.''
 
                                      President Clinton
                                      August 1998
 

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   As the era that has been labeled the American Century comes to a 
close, the role of the United States in one significant way remains 
unchanged. Today, America is the world's sole remaining superpower and, 
therefore, still has its own set of unique obligations and 
responsibilities. The world in many ways is safer than in the past, as 
democracy and free markets increasingly prevail, but we cannot afford to 
be complacent. Threats to our security still require our vigilance, and 
opportunities to promote peace and economic well-being demand our 
leadership.
   America must remain a leader for peace, freedom, and security--and a 
bulwark against the forces that would undermine them. American diplomacy 
helped restore momentum in the Middle East peace process at the Wye 
River meeting and helped achieve the ratification of the Good Friday 
Accord, which brought an end to 30 years of turmoil for the people of 
Northern Ireland.
   While progress in making peace offers cause for optimism, there are 
real and growing threats to our national security. The terrorist attacks 
against two U.S. embassies in East Africa last year--which killed 
hundreds of people, including 12 Americans--are a stark reminder that we 
need to protect our citizens and to combat our enemies. Our security and 
the stability of the international order is also threatened by the 
proliferation of weapons of mass destruction and their means of 
delivery, international terrorism and crime, narcotics, and 
environmental degradation.
   Nations and their economies are increasingly interdependent, due in 
large part to the explosion of communications technology. While this 
interdependence can help foster international trade and cultural 
understanding, and contribute to the foundation for peace, there are 
also fundamental risks. Last year, disruptions in the Russian and 
several Asian economies and the threat to Brazil's economy demonstrated 
the world-wide impact of crises in major economies.
   In order to ensure that America maintains its role as world leader 
and responds to these needs in a complex and crucial time, the budget 
includes resources to promote peace in troubled areas, to provide 
enhanced security for our diplomats abroad, to fund activities to combat 
weapons of mass destruction, to stabilize the international economy, to 
promote trade, and to respond to the needs of our neighbors and others 
who face disaster.
   American diplomacy is the tool of American international leadership 
in these many important issues, and it depends on strong international 
affairs programs. In 1999, the Administration and Congress worked 
successfully to build bipartisan support for an increase in 
international affairs spending.

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   Congress appropriated $14.5 billion for the U.S. share of the 
International Monetary Fund (IMF) quota increase and $3.5 billion for 
the U.S. share of the New Arrangements to Borrow. These increases will 
allow the IMF the necessary resources to support economic reform and 
restructuring around the world, thereby helping to protect U.S. 
prosperity. Congress also appropriated $1.8 billion in emergency 
funding, largely to meet the urgent needs of protecting American 
personnel and facilities abroad from terrorist attacks.
   Despite significant progress on international problems last year, 
there is an unfinished and growing set of issues which are critical to 
U.S. interests. The Administration and Congress must continue efforts to 
promote peace and stand with those working to build it and to work for 
freedom and security. We must continue to strengthen our alliances and 
partnerships in Europe and Asia, the foundation for America's security. 
Finally, we must work to deepen democracy around the world--the best 
long-term investment we can make in peace and stability.
   Although American diplomacy has made great strides to advance the 
peace process in the Middle East and in the Balkans, there is still an 
enormous amount of hard work ahead. Collaboration between the 
Administration and Congress is essential to give peace in those regions 
the opportunity it deserves. Trade has been essential to the current 
economic expansion, and Congress should enact legislation promoting 
trade with Africa and the Caribbean Basin. Such trade initiatives can 
help bolster the growth of countries undertaking desirable free-market 
reforms, thereby helping the American economy by increasing markets for 
our own exports.
   In providing $21.3 billion for international affairs programs, the 
budget proposes that the United States continue to actively meet the 
role and responsibility of world leadership (see Table 10-1). The budget 
helps resolve unfinished business from past years, addresses the many 
new crises facing the world, and targets funding increases to the most 
effective programs to achieve foreign policy objectives, rejecting 
outmoded activities and poorly-performing projects. This will strengthen 
U.S. leadership and benefit the American people, while costing less than 
one percent of the Federal budget.

Protecting American Security

   Facility Vulnerability: The bombings of the U.S. embassies in Kenya 
and Tanzania were evil acts of terror that took the lives of hundreds of 
innocent people, including 12 Americans. The bombings highlight the 
dangers faced daily by Americans and foreign national employees who work 
abroad in U.S. Government facilities. A significant step to address 
vulnerability in our diplomatic facilities took place with enactment of 
emergency security funding in 1999. The budget proposes an increase to 
the State Department's operating budget in 2000 to ensure the continued 
protection of American embassies, consulates and other facilities, and 
the valuable employees who work there. The Administration will continue 
to examine the vulnerabilities and requirements for U.S. Government 
staff overseas through a review of the number, size, and composition of 
U.S. overseas missions and future security requirements. To address 
further security needs, the budget includes a request for $3 billion in 
advance appropriations for a new multi-year security construction 
program to replace inadequate overseas facilities. The Administration 
will continue to work with Congress in a bipartisan manner to address 
the continuing challenge of making our overseas posts secure.
   The New Transnational Threats: Another fundamental goal, and an 
increasing focus of our diplomacy, is meeting the new transnational 
threats to U.S. and global security--the proliferation of weapons of 
mass destruction, drug trafficking, and the spread of crime and 
terrorism on an international scale. In 1997, the Administration sought 
and obtained Senate ratification of the Chemical Weapons Convention, 
which will begin imposing controls on a class of destructive weapons not 
well regulated in the past. However, the Senate has not yet ratified the 
Comprehensive Nuclear Test Ban Treaty (CTBT), which it has had since 
September 1997, and which is central to national security interests. 
U.S. diplomacy and law enforcement are playing a key role in stemming 
the spread of weapons of mass destruction to outlaw states such as

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                                Table 10-1.  INTERNATIONAL DISCRETIONARY PROGRAMS
                                 (Budget authority, dollar amounts in millions)
----------------------------------------------------------------------------------------------------------------
                                                                                               Dollar    Percent
                                                                  1998      1999      2000     Change:   Change:
                                                                 Actual   Estimate  Proposed   1999 to   1999 to
                                                                                                2000      2000
----------------------------------------------------------------------------------------------------------------
International development and humanitarian assistance 1, 2....     6,797     6,966     7,606      +639       +9%
International security assistance \2\.........................     6,102     6,022     6,232      +210       +3%
Conduct of foreign affairs/foreign information and exchange
 programs 1, 2................................................     4,966     4,904     5,478      +573      +12%
International financial programs \3\..........................       666       750       881      +131      +17%
                                                               -------------------------------------------------
Subtotal, International discretionary programs................    18,531    18,643    20,196    +1,554       +8%
 
  Multilateral Development Bank arrears.......................       360       539       169      -370      -69%
  International Organization arrears..........................       100       475       446       -29       -6%
  Enacted embassy security and other emergency items..........  ........     1,900  ........  ........  ........
                                                               -------------------------------------------------
Subtotal, including arrears and enacted emergency
 appropriations...............................................    18,991    21,557    20,811      -746       -3%
Proposed Wye River supplemental...............................  ........       900       500        NA        NA
                                                               =================================================
Total, including proposed Wye River supplemental..............    18,991    22,457    21,311    -1,146       -5%
----------------------------------------------------------------------------------------------------------------
NA = Not applicable.
 
\1\ Excluding arrears payments.
 
\2\ Excluding 1999 embassy security and other emergency appropriations.
\3\ Excluding 1999 appropriations for the International Monetary Fund.

  Libya, Iraq, Iran, Syria, and North Korea. In addition, U.S. support 
  for such organizations as the International Atomic Energy Agency, the 
  CTBT Preparatory Commission, and the Korean Peninsula Energy 
  Development Organization is critical to help prevent the spread of 
  dangerous nuclear weapons.--------------------------------------------
   U.S. bilateral assistance programs are essential to efforts attacking 
other transnational problems. America's international counter-narcotics 
efforts are making continued progress in drug-producing countries. Along 
with the additional funding of $233 million in enacted 1999 emergency 
appropriations, the budget proposes $295 million to enable the United 
States to intensify its efforts to curb drug production in the Andean 
countries and to fight international crime.

   The Newly Independent States (NIS): The transition to market 
democracies in the NIS remains vital to U.S. national security. Russia 
remains the key to overall progress in the region. The budget proposes 
$1.03 billion for assistance to the NIS. The pace of that transition 
continues to be uneven, and last year there were serious economic 
setbacks for Russia. Although these nations have embraced free 
elections, there is a lack of political consensus in support of economic 
reforms, which makes prospects for sustained economic growth dubious.
   The United States and Russia share a mutual goal of preventing the 
proliferation of expertise and technology related to weapons of mass 
destruction (WMD). Current economic conditions increase the risk of 
proliferation because weapons scientists and technicians are unemployed 
or unpaid, and guards at facilities and borders are untrained and 
poorly-equipped. The budget supports significant increases in funding 
for State Department

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programs from $41 million last year to $251 million to address this 
concern. In addition, the Department of Defense Cooperative Threat 
Reduction program is funded at $476 million and the Department of Energy 
WMD programs in the NIS are funded at $276 million (see Table 10-2).
   In addition to this enhanced emphasis on WMD, the budget includes a 
renewed emphasis on our Partnership for Freedom programs, which work 
directly with the private sector and nongovernmental organizations, 
develop partnerships between U.S. and NIS institutions, increase 
exchanges, and help local governments increase trade and investment.

Promoting Peace Abroad

   Peace in the Middle East: The United States remains committed to a 
comprehensive peace in the Middle East. America continues to play a 
leadership role in this effort. The Wye River Memorandum, signed in 
October 1998, is an important milestone in this process. The effective 
implementation of this Memorandum should restore positive momentum to 
the peace process. The Wye Memorandum provides among other things for 
enhanced security steps by the Palestinians, improved security 
cooperation between Israelis and Palestinians, further redeployments of 
Israeli forces in the West Bank, the opening of the Gaza airport, and 
creation of a safe passage between Gaza and the West Bank. The budget 
proposes $5.2 billion for assistance to sustain the Middle East peace 
process.
   In addition, the Administration proposes a $1.9 billion economic and 
military assistance package to help meet priority needs arising from the 
Wye Memorandum. This is comprised of $900 million in 1999 supplemental 
budget authority (to be fully offset with an equal reduction of budget 
authority) and $500 million in annual advance appropriations in 2000 and 
2001. Supplemental Economic Support Fund (ESF) resources will help meet 
the Palestinians' economic development needs in the West Bank and Gaza, 
and strengthen democratic institutions. Supplemental Foreign Military 
Financing (FMF) funding for Israel will help Israel offset some of the 
costs of redeploying its forces and enable it to meet strategic defense 
requirements. Additional FMF funding for Jordan will allow it to 
maintain the operational capabilities of its forces and additional ESF 
resources for Jordan will support further economic development.

   Central and Eastern Europe: The transition to democracy and free 
markets in Central and Eastern Europe is advancing rapidly. Countries 
are moving to join the European Union and the World Trade Organization. 
Poland, Hungary, and the Czech Republic are joining NATO. Economic 
growth is widespread, and respect for human rights is growing. U.S. and 
other international support has been a critical factor in the pace of 
that transition. In certain nations, the success is evident: democracy 
has taken hold firmly while free markets prevail. At this time, 
Lithuania and Poland join the Czech Republic, Slovenia, Latvia, and 
Hungary as states that no longer need direct U.S. assistance.
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                               Table 10-2.  THREAT REDUCTION ASSISTANCE IN THE NIS
                                 (Budget authority, dollar amounts in millions)
----------------------------------------------------------------------------------------------------------------
                                                                                                 Dollar  Percent
                                                                     1998     1999      2000    Change:  Change:
                                                                    Actual  Estimate  Proposed  1999 to  1999 to
                                                                                                  2000     2000
----------------------------------------------------------------------------------------------------------------
Department of Defense.............................................     382      440       476      +36      +8%
Department of Energy..............................................     212      237       276      +39     +16%
Department of State...............................................      20       41       251     +210    +512%
                                                                   ---------------------------------------------
  Total...........................................................     614      718     1,003     +285     +40%
----------------------------------------------------------------------------------------------------------------

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   The success of these northern-tier countries of the region will be 
used to foster similar results in the southern tier where the transition 
has not been as rapid. Reform minded governments in Bulgaria, Macedonia, 
and Romania continue to work toward creating free markets and democratic 
governance. However, challenges remain in the rest of the Balkans. 
Substantial assistance will continue to enable countries to participate 
in the Partnership for Peace programs, thereby improving mutual 
understanding and enhancing the interoperability of regional military 
forces with NATO. The budget proposes $393 million in economic aid for 
Eastern Europe and the Baltic States, primarily focused on the southern 
tier.

   Bosnia: $175 million of the economic aid program would support the 
U.S. commitment to see the Dayton Accords fully implemented in Bosnia. 
U.S. assistance will help displaced persons and refugees return home; 
multi-ethnic communities rebuild; numerous leaders embrace the economic 
reforms necessary to expand opportunities and sustain economic growth; 
and governments to continue restructuring their police forces in order 
to provide all citizens with a secure environment. American troops 
remain in the region and our assistance programs are designed to 
complement their work and build on the stability created by their 
presence.
   Kosovo: In Kosovo, international diplomatic efforts backed by U.S. 
and allied military capabilities have helped increase stability in this 
troubled region. However, the ability to foster a peaceful transition 
that protects the rights of all citizens in that part of Yugoslavia 
continues to hang in the balance. U.S. humanitarian assistance has 
helped alleviate suffering, but we must work with our allies to help 
create a sustainable peace. The budget includes $46 million for an 
observer force to verify compliance by all parties and to support the 
training of a professional, ethnically representational, local police 
force that protects the rights of all citizens. In addition, $50 million 
is included in the budget for the U.S. contribution to an international 
civil reconstruction effort.
   Hurricane Mitch: In 1998, Hurricane Mitch, the most destructive 
hurricane in recent history, caused over $10 billion in damage to 
Central America. The United States immediately stepped up to the massive 
relief and reconstruction needs caused by this unprecedented disaster, 
pledging over $500 million. However, there is much more that needs to be 
done to help these neighboring countries recover from this devastation, 
and funding is needed urgently. Therefore, the President will work with 
the Congress in a bipartisan effort to obtain 1999 supplemental funds to 
address the damage caused by Hurricane Mitch, as well as that caused in 
the Caribbean by Hurricane Georges.

Leading the International Community

   Following World War II, the United States assumed a unique leadership 
role in building international institutions to bring the world's nations 
together to meet mutual security, economic, and humanitarian needs. 
America sponsored and provided significant funding for the UN, NATO, the 
IMF, and the World Bank, along with other specialized regional security 
and financial institutions that became the foundation of international 
cooperation during the Cold War and the post-Cold War period.
   To ensure financial stability for this international community, 
members of the international organizations (IOs) entered into treaties 
committing them to pay specified shares of IO budgets. Congress ratified 
these agreements, making them binding on the United States. For the 
Multilateral Development Banks (MDBs) which include the World Bank, its 
regional development bank partners, and the Global Environment Facility 
(GEF), the United States and other developed countries make firm 
commitments to regular replenishment of their resources. Replenishments 
are subject to the congressional authorization and appropriations 
processes.
   By 1997, America's leadership in this international institutional 
network had seriously eroded due to past legislative action that reduced 
funding for our assessments and commitments. The resulting arrears to 
the IOs had accumulated to almost $1.5 billion. Although the 
Administration and Congress developed bipartisan support for authorizing 
legislation in 1997, and again in 1998, to clear many of the assessed 
arrears over

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three years in return for specified IO reforms, the legislation was 
never enacted.
   Congress did pass appropriations of $100 million in 1998 and $475 
million in 1999, subject to enacting authorization legislation and 
certain other conditions. The budget proposes that the Administration 
and Congress work together once again to reach agreement on paying the 
UN and related IO arrears. The budget includes the third-year 
installment of arrears funding of $446 million and seeks $1.198 billion 
to meet regular assessments to the IO's and for UN peacekeeping 
operations.

Stabilizing the International Economy

   As the world becomes more economically integrated, the smooth 
functioning of its monetary system becomes increasingly critical to 
every nation's economy. The severe disruptions in the Russian and 
several Asian economies and the threat to Brazil's economy in 1998 
demonstrated the world-wide impact of crises in major economies. Despite 
its size and strength, even the U.S. economy is not immune and could 
suffer if measures were not taken to keep global economic crises in 
check. It is exactly these kind of disruptions that the International 
Financial Institutions (the IMF, the World Bank, and the other MDBs) 
were created to address, and, thanks in part to the bipartisan effort to 
increase the resources available for the IMF last year, these 
institutions have already begun to provide the loans needed for 
Indonesia, Brazil, and the other countries most affected, so that they 
may begin the long and difficult recovery process.

   Multilateral Development Banks (MDBs): There has been progress in the 
past two budgets, with Congress funding most of U.S. arrears to the 
MDBs, leaving $310 million unfunded at present. This advancement, much 
improved since 1997, when arrears totaled nearly $862 million, enabled 
the Administration to engage other donors and gain agreement on 
important new policy measures during new replenishment negotiations this 
past year for the International Development Association, the African 
Development Fund, and the Inter-American Development Bank. The budget 
also proposes $168 million to continue the planned payment of MDB and 
new GEF arrears and $1.2 billion to pay current commitments to these 
institutions, which provide most of the assistance to poor countries 
around the world that are undertaking promising economic reforms. During 
the Clinton Administration, U.S. commitments for all the MDBs have been 
cut by 40 percent from the levels in the mid-1990s.
   International Debt Policy: In providing $120 million, the United 
States will promote economic and environmental reform for countries in 
support of the Tropical Forest Conservation Act of 1998 and help defray 
the cost of debt relief by contributing to the Heavily Indebted Poor 
Country Initiative Trust Fund. Furthermore, the United States will 
continue its efforts to stimulate economic growth for the world's poorer 
countries by participating in the multilateral Paris Club debt 
reductions and providing bilateral debt relief as part of the 
President's Africa Initiative.

Supporting International Development and Addressing International 
Disasters

   Development assistance, through the MDBs and bilaterally through the 
U.S. Agency for International Development (USAID), funds projects which 
create the conditions for economic growth, stable democracies, improved 
human health, and basic education. Our ongoing commitment to provide 
assistance to the poorest countries serves long-term U.S. interests and 
diminishes the need for short-term crisis intervention.

   Assistance to Africa: The budget proposes $828 million for Africa--an 
increase of almost 10 percent--meeting the President's goal of 
increasing support for Africa to historically high levels. These levels 
of assistance recognize the increased progress towards reform and 
economic growth that is being made by a number of African nations. The 
assistance programs funded at current or increased levels will include 
Presidential initiatives on food security, education, and trade and 
investment. The budget also includes increased support for programs 
aimed at reducing conflict, promoting regional peacekeeping and 
encouraging democracy, as well as enactment of the President's trade 
package for Africa.

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   USAID's Development Assistance Programs: The budget proposes $1.8 
billion for USAID's development assistance programs, which provide 
funding to 51 countries and 12 regional programs in Africa, Asia, and 
Latin America. In Asia, USAID programs will provide an important element 
of the U.S. Government response to the challenges of the economic 
collapse and an inadequate social safety net, and the opportunity to 
support genuine democratization. In Latin America, the continuing 
assistance provided in the budget is critical to meeting the long-term 
needs arising from the devastation of Hurricane Mitch.
   Humanitarian Assistance: Unfortunately, many countries face crises 
which impede their development, both from natural disasters--so clearly 
illustrated by the impact of Hurricane Mitch--and from ongoing civil 
conflicts. The budget proposes $1.7 billion for the humanitarian 
assistance programs of the Department of State and USAID. The Department 
of State's refugee program provides for care and maintenance of refugees 
abroad and resettlement assistance to those refugees admitted to the 
United States. USAID, through its Office of Foreign Disaster Assistance, 
provides for the immediate needs of victims of natural and manmade 
disasters, including internally displaced persons. In addition to direct 
relief, USAID also works to improve the ability of poor countries to 
deal with disasters through its prevention and mitigation programs and 
programs aimed at helping countries move from conflict to peace. USAID 
also provides food aid for vulnerable populations through the Food for 
Peace program.
   Environment and Population Growth: USAID development assistance and 
U.S. contributions to international efforts, such as the GEF and 
Montreal Protocol, support large and successful programs to improve the 
environment and reduce population growth. The budget also continues to 
fund USAID's multi-year global climate change initiative. The United 
States is the recognized world leader in promoting safe, effective 
family planning projects and the budget request continues to fund 
significant levels of U.S. assistance for these programs.
    

   Peace Corps: The Peace Corps promotes better understanding among 
nations through its volunteers who have served as unofficial ambassadors 
to the developing world. The American people strongly support the 
program. The budget proposes $270 million to enable the agency to 
continue increasing the number of volunteers abroad--with the goal of 
building towards 10,000 volunteers by early in the next century.

Increasing American Prosperity Through Trade

   The Administration remains committed to opening global markets and 
integrating the global economic system, which has become a key element 
of continuing economic prosperity here at home. This goal is 
increasingly central to America's diplomatic activities. The 
Administration is helping to lay the groundwork for sustained, non-
inflationary growth into the next century by implementing the North 
American Free Trade Agreement and the multilateral trade agreements 
concluded during the Uruguay Round.

   Export Promotion Initiative: After years of double-digit growth, U.S. 
manufacturing exports slowed in 1998 as a result of global economic 
problems, and that led to thousands of worker layoffs. Because millions 
of American jobs depend on foreign exports, we must help U.S. 
manufacturers find new markets and attract new customers for our goods 
overseas. Toward that end, the budget includes a $108 million multi-
agency initiative to spur additional U.S. exports. First, the initiative 
boosts funding by 10 percent--or $81 million--for the Export-Import 
Bank, which helps U.S. exporters by providing prudent financing for 
customers in developing countries when private funds are not available 
and by strategically leveling the playing field against aggressive, 
foreign export-credit subsidies. With the additional funds, the Bank can 
keep U.S. products--from aircraft parts to capital equipment to 
environmental technology--flowing to emerging markets where commercial 
banks have withdrawn. Second, the Trade and Development Agency receives 
an additional $4 million to fund feasibility studies that enable U.S. 
companies to participate in major export-generating infrastructure 
projects overseas. Third, the initiative provides $14 million for the De

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partment of Commerce's International Trade Administration (ITA) to 
increase resources for export advocacy in key markets and for delivery 
of export assistance services to America's 350,000 small manufacturers. 
Finally, the initiative provides $9 million for ITA and Commerce's 
National Institute of Standards and Technology (NIST) to expand U.S. 
efforts to help developing countries establish the legal and 
institutional framework needed for a commercial infrastructure making it 
easier and cheaper for U.S. firms to export.
   Free and Fair Trade: The Administration will continue to press 
forward with open trade. At this time of economic fragility in so many 
regions, it is important to continue to pursue open markets. The budget 
proposes significant increases for trade negotiators to pursue an open, 
fair, rules-based trading system which ensures that spirited economic 
competition among nations does not become a race to the bottom in 
environmental protections, consumer protections, or labor standards.
   The Administration also will propose to give expanded trade benefits 
for two years to the eligible countries under the Caribbean Basin 
Initiative, and will propose special trade benefits on a permanent basis 
to African countries that are reforming their economies, as part of a 
larger trade and investment initiative for Africa. In addition, the 
Administration will propose a one-year extension of the Generalized 
System of Preferences beyond its current expiration date of June 30, 
1999, in order to continue the reduced tariffs on many imports from 
developing countries provided for by this system.

   Additional Trade Activities: The Trade Promotion Coordinating 
Committee (TPCC) is currently focusing on several key strategic 
objectives in order to provide more effective and better coordinated 
trade promotion programs. The TPCC works to promote exporter awareness 
of the benefits of trade, to respond effectively to the Asian crisis. 
The TPCC is also working to improve trade in important economic markets 
around the world.
   The Administration also strongly supports the reauthorization of the 
Overseas Private Investment Corporation which has been an important part 
of trade and investment initiatives through its investment insurance and 
finance programs. In addition, the budget provides an 18-percent 
increase, to $20 million, for the Commerce Department's Market Access 
and Compliance Unit, whose members monitor trade agreements and identify 
compliance problems.

Conducting Effective Diplomacy

   Effective diplomacy is the foundation of our ability to meet foreign 
policy goals. The budget supports a strong U.S. presence at over 250 
embassies and other posts overseas, promoting U.S. interests abroad and 
protecting and serving Americans by providing consular services. The 
work of the Department of State and U.S. missions supports the goals and 
initiatives of American foreign policy, and anticipates and helps to 
prevent threats to our national security. This work has expanded 
considerably in recent years to include combating threats from 
terrorism, proliferation of weapons of mass destruction, nuclear 
smuggling, international crime, and narcotics trafficking. The overseas 
posts also serve as the administrative platform for the many other U.S. 
agencies with personnel abroad, from USAID to the Departments of 
Defense, Justice, and the Treasury.

   Foreign Affairs Reorganization: Enactment of the Foreign Affairs 
Reform and Restructuring Act of 1998 provided the President the 
authority to fundamentally restructure foreign affairs agencies. The 
reorganization will put matters of international arms control, 
sustainable development policy, and public diplomacy at the heart of our 
foreign policy within a reinvented Department of State.
   The reorganization will integrate the Arms Control and Disarmament 
Agency (ACDA) and the non-broadcasting portion of the U.S. Information 
Agency (USIA) as well as certain limited functions of USAID into the 
State Department. The Broadcasting Board of Governors, which oversees 
all governmental non-military broadcasting abroad and is currently part 
of USIA, will become an independent Federal establishment.

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   Diplomatic and Consular Operations: The budget proposes $3.6 billion 
in 2000 for the State Department, including public diplomacy and arms 
control activities. Of this total, $0.7 billion is proposed for 
continuing public diplomacy activities (formerly USIA) and $48 million 
is for arms control and nonproliferation activities (formerly ACDA). 
This funding level will maintain the Department's world-wide operations, 
continue efforts to upgrade information technology and communications 
systems, and accommodate increased security and facility requirements at 
posts abroad. The major increases proposed in the budget provide for 
security and facility enhancements that will allow foreign policy 
professionals abroad to do their jobs in a safer environment. The budget 
requests $3 billion in advance appropriations to fund the construction 
of secure embassies and posts around the world. The Administration will 
pursue these enhancements through a capital construction strategy that 
will effectively and efficiently meet America's security needs.
   USAID Operating Expenses: The budget proposes $508 million for USAID 
operating expenses. The largest portion of this increase over 1999 ($12 
million) will provide USAID with the resources it needs to continue to 
improve its information technology and financial management 
capabilities. The resources will also allow USAID to maintain its 
overseas presence in key developing countries, although it will require 
USAID to continue its successful reinvention efforts in order to meet 
increased program delivery requirements without increasing overseas 
staff or expenses. The budget also accommodates the shift of security 
functions from the USAID Inspector General to USAID operating expenses, 
as required by the 1999 Foreign Operations Appropriations Act.