    [Economic Outlook, Highlights from FY 1994 to FY 2001, FY 2002 Baseline Projections]
    [III. Major Functions of the Federal Government]
    [3.  International Affairs]
    [From the U.S. Government Printing Office, www.gpo.gov]

    [[Page 53]]

                            3.  INTERNATIONAL AFFAIRS

      ----------------------------------------------------------------------

                            Table 3-1.  Federal Resources in Support of International Affairs
                                              (Dollar amounts in millions)
    ----------------------------------------------------------------------------------------------------------------
                                                                                                            Percent
                                    Function 150                                     1993        2001       Change:
                                                                                    Actual     Estimate    1993-2001
    ----------------------------------------------------------------------------------------------------------------
    Spending:
      Discretionary budget authority \1\........................................     21,194      22,706          7%
      Mandatory outlays.........................................................     -4,322      -8,815        104%
    Credit Activity:
       Direct loan disbursements................................................      1,943       2,862         47%
       Guaranteed loans.........................................................      9,531      11,110         17%
    Tax expenditures............................................................      4,510      18,060          NA
    ----------------------------------------------------------------------------------------------------------------
    NA = Not applicable.
    \1\ Excludes $12,063 million in 1993 for an increase in the U.S. quota at the International Monetary Fund.

      ----------------------------------------------------------------------
      International affairs activities support America's critical interests
    by reaching key strategic goals: fostering worldwide economic growth,
    supporting the establishment and consolidation of democracy abroad,
    enhancing America's national security, improving the global environment,
    and addressing other key global issues, such as AIDS. The Clinton-Gore
    Administration capitalized upon the new post-Cold War architecture by
    working to expand the global economy and the benefits of globalization,
    supporting the liberalization of trade, and aiding countries in their
    transition to democracy.

    Promoted Free Trade, Open Markets, and Economic Prosperity

      Completed Successful Trade Negotiations--the North American Free Trade
    Agreement and the Uruguay Round: Strong U.S. growth over the past eight
    years accompanied America's increased integration into the world
    economy. Between 1992 and 1999, the U.S. economy, as measured by real
    gross domestic product, grew at an average annual rate of 3.7 percent,
    while real exports of goods and services increased on average by 6.8
    percent per year. Imports have grown at an average annual rate of 10.6
    percent per year. This reflects both stronger growth in the United
    States than in the rest of the world over much of this period, and the
    crucial role of imports--now dominated by capital goods such as the
    computers and machinery--in supporting U.S. investment. Indeed,
    increased globalization has come at a time of rapid growth that has
    produced a dramatic increase in the number of new jobs and the reduction
    of unemployment to the lowest levels in 30 years.
      These developments have been facilitated by the Administration's trade
    policy accomplishments, including passage of the Uruguay Round trade
    agreements, the North American Free Trade Agreement, and over 200 post-
    Uruguay Round negotiations that have yielded additional market access
    commitments in financial services, basic telecommunication services, and
    information technology. Several studies recently reviewed by the Council
    of Economic Advisers estimate an annual income gain to the United States
    of between $27 billion and $37 billion with full implementation of the
    Uruguay Round's results.

      Successfully Managed Financial Crises in Mexico and Asia: Since 1993,
    the Administration has confronted and successfully responded to two
    serious financial crises that threatened to undermine regional and
    global

    [[Page 54]]

    economic stability. In December 1994, the rapidly depreciating Mexican
    peso jeopardized the economic progress and reforms made by the
    government of Mexico up to that point. In response, the Administration
    extended up to $20 billion in available credits through the Exchange
    Stabilization Fund (ExSF), and worked with the International Monetary
    Fund (IMF) to extend a line of credit based on the implementation of
    further reforms. The rapid response proved instrumental in restoring
    investor confidence and allowing the Mexican economy to resume growth.
    As a measure of this success, by January 1997, Mexico had repaid ahead
    of schedule all of the $11.5 billion it drew from the facility.
      A more serious crisis emerged in the fall of 1997 when the devaluation
    of the Thai currency began a series of currency crises in Asia that soon
    engulfed Malaysia, Indonesia, Philippines, and South Korea--and later
    Russia. This crisis, because of its size and the region's integration
    into the global economy, threatened the stability of the global economic
    and financial system. The Administration responded to this crisis by
    advancing steps to strengthen the international financial architecture,
    by maintaining open markets, by making the ExSF available as part of a
    secondary line of defense against further instability, and by achieving
    authorization and appropriation for an IMF quota increase and the
    establishment of the New Arrangements to Borrow (NAB). Coupled with the
    macroeconomic and structural reforms implemented by the Asian
    governments, much of the region has resumed positive growth rates in a
    more sustainable fashion just two years after the crisis.

      Passed the International Monetary Fund Quota Increase and the New
    Arrangements to Borrow: In cases of severe international financial
    crises, the IMF plays a key role in mobilizing official assistance
    conditioned on policy reforms--and is the one institution situated to
    mobilize such substantial support quickly--and provides the predominant
    share of official financing needed to help stabilize the global monetary
    system. In September 1997, the 11th quota review resulted in a call for
    a 45-percent increase in the resources of the IMF to allow it to carry
    out its normal operations while preserving the ability to respond to
    such crises in a rapidly growing and increasingly complicated world
    economy. In addition to the IMF quota increase, the G-7 nations proposed
    the creation of the New Arrangements to Borrow, which would complement
    the existing supplemental credit line, the General Arrangements to
    Borrow.
      The call for an increase in available IMF resources coincided with the
    decade's gravest threat to the global financial and economic system, the
    East Asian Financial Crisis. With this event as a backdrop, the
    Administration requested and received authorization and appropriations
    for both the quota increase ($14.5 billion) and the NAB ($3.4 billion)
    in 1999. That legislation resulted in both the needed resources being
    made available and a bi-partisan agreement on policy priorities in the
    IMF, which included a commitment to greater IMF transparency, resulting
    in the adoption of a number of reforms by the Fund. With the quota
    increase and credit line in hand, the IMF was able to play a critical
    role in responding to the crisis and help the affected countries along
    the path of reform and sustainable growth.

    Facilitated the Continued Transition to Democracy Throughout the World

      Helped Integrate Poland, Hungary, and Czech Republic into the West:
    The integration of Poland, Hungary, and the Czech Republic into the
    democratic, free-market family of nations and Western institutions such
    as NATO is one of the key foreign policy achievements of the past eight
    years. Since 1993, U.S. efforts in these countries focused on building
    democratic institutions and achieving economic reforms. Timely and
    effective U.S. assistance played a key role in their governments'
    efforts to privatize industries and put in place the judicial and
    regulatory structures needed for a market economy and a society based on
    the rule of law. As a result of these efforts, by 2000, these three
    countries had graduated from being Support for Eastern European
    Democracy aid recipients to becoming NATO allies, all within one decade
    of the dismantling of their Communist regimes.

    [[Page 55]]

      As a measure of the success of U.S. assistance efforts, according to
    Freedom House, all three countries have achieved political rights and
    civil liberties that are roughly comparable to those found in Western
    Europe, with their Freedom House ratings, based on a 1 to 5 scale,
    improving from 4.2 in 1992 to 4.7 in 1999. Similarly, U.S. assistance in
    implementing economic reforms has helped all three countries develop
    effective market institutions and flourishing private sectors. Because
    their transformations have been so successful, Hungary, Poland, and the
    Czech Republic are among the first tier of countries that will be
    considered for membership in an expanded European Union.

      Helped Democratic Transitions in Russia and Ukraine: Since 1993, the
    Administration's assistance strategy for the states of the former Soviet
    Union has been designed to foster their transition to democracy and
    market-based economies and to facilitate their integration into the
    larger global community, while advancing U.S. national security
    interests in such areas as nonproliferation and arms control. The
    strategy has achieved notable successes during the past eight years. In
    Ukraine, for example, U.S. assistance made possible Ukraine's complete
    denuclearization and helped develop and implement a successful
    privatization program for small- and medium-sized enterprises. Similar
    assistance efforts in Russia, particularly in the threat reduction area,
    have helped ensure implementation of landmark arms control treaties and
    ensure that weapons of mass destruction do not fall into the wrong
    hands. In both countries, U.S. assistance has helped promote the growth
    of independent media and non-governmental organizations. The transitions
    in Russia and Ukraine are incomplete, but both countries have made
    important strides toward development of democratic institutions and the
    rule of law. Their successful completion will depend upon continued
    commitment on the part of both governments to overcome challenges such
    as crime and corruption as well as economic inequality, combined with
    the implementation of effective reform programs and improvements to the
    investment climate.
      Promoted Peace in the Middle East: During the last eight years, the
    United States has been a strong and continuous supporter of the search
    for a comprehensive peace in the Middle East. United States diplomatic
    and financial support has been indispensable for progress towards peace
    and stability in the region. Our efforts have focused on promoting
    progress and stability through bilateral negotiations between Israel and
    the Palestinians, Syrians, and Lebanese; through supporting allied
    nations with diplomacy, military deployments, and security assistance;
    and, through regional economic development and containment of Iraq and
    other threats to stability in the region. U.S. assistance has
    contributed to and helped sustain the progress achieved as a result of
    the Oslo Accords, the supplementary Wye River and Sharm el Sheik
    agreements, the Jordanian-Israeli peace treaty, and the Camp David
    negotiations this past year. Most recently, the Administration submitted
    a request of $750 million in supplemental 2001 funding and recommended
    an additional $500 million in 2002 funding to assist those countries and
    parties in the Middle East that take constructive steps in the search
    for peace. In the current tragic circumstances of continued violence in
    the region, the United States has worked closely with the parties to end
    the violence and has supported international efforts, such as the
    International Fact Finding Committee, designed to diffuse tensions and
    restore confidence among the parties in the region.
      Promoted U.S. Assistance for Plan Colombia: The U.S. assistance to
    Plan Colombia is a $1.3 billion bi-partisan, integrated set of programs
    developed with the government of Colombia and designed to reduce the
    supply of drugs coming into the United States and to bring greater
    stability to the Andean region. This emergency supplemental
    appropriation was signed by the President in July 2000, and includes
    funding for interdiction of trafficking, eradication of illicit crops,
    alternative development, human rights strengthening, displaced persons,
    and justice system reforms in Colombia and other Andean countries. Even
    as implementation proceeds, the United States continues to lead efforts
    to encourage cooperation and contributions from the international
    community. Success of this program will depend upon the successful
    coordination of its different, inter-related facets, and upon the
    direction taken by Colombia's internal conflict.

    [[Page 56]]

      Helped Democracy in Guatemala: After 36 years of civil war that led to
    the death of up to 200,000 people, the government of Guatemala signed a
    peace agreement formally ending the conflict in 1996. The peace accords
    established the framework for a more participatory and equitable society
    involving the integration into society of ex-rebels and a comprehensive
    restructuring of the military, justice system, tax policy, and social
    services.
      As part of a multilateral effort to support the peace accords, the
    United States doubled its assistance to Guatemala, and has provided over
    $110 million in Economic Support Funds since 1997 to support the
    implementation of the accords, the demobilization of thousands of ex-
    combatants, infrastructure reconstruction in war-affected areas, land
    titling, fiscal reform, and literacy of women. With strong multilateral
    support, Guatemala is now entering its fifth year of successfully
    implementing the peace accords. These structural reforms have started
    the process of transforming Guatemala into a more participatory and
    equitable society, but significant challenges remain. The Agency for
    International Development (USAID) plans to continue support for the
    peace process until 2003 to address remaining challenges, including
    continuing income disparities, land distribution issues, and civic
    violence.

      Debt Forgiveness: In 1999, under United States leadership, the G-7
    nations agreed at the Cologne summit to an initiative to provide
    expanded debt reduction to heavily indebted poor countries (HIPCs). This
    initiative will provide the 33 countries likely to meet HIPC eligibility
    requirements with debt reduction of up to $90 billion, or 70 percent of
    their total debt. For 2000 and 2001, the Congress appropriated the
    Administration's full request of $545 million ($185 million for the
    reduction of U.S. bilateral debt and $360 million as a contribution to
    the HIPC trust fund to reduce the debt held by regional development
    banks) for the expanded HIPC initiative. In order to fully implement the
    initiative, $375 million in additional funds will need to be
    appropriated in 2002 and 2003.
      Many poor countries, particularly in Africa, have developed
    unmanageable debt burdens to official bilateral and multilateral
    creditors, and the debt servicing payments to these creditors often
    prevent these countries from making desperately-needed social
    investments in poverty reduction, primary education, child immunizations
    and other health programs, or clean water and sanitation. In the vast
    majority of HIPCs, per capita Gross National Product amounts to less
    than $1 per day and the average for all HIPCs is only about $360 per
    year. In response to the needs of these countries, the United States
    proposed to expand the HIPC initiative (originally adopted in 1996) to
    provide deeper, broader, and faster debt reduction for more countries,
    contingent on economic reforms and application of savings on debt
    servicing to social concerns. While the Administration's efforts have
    been a leap forward in addressing the debt burden of poor countries,
    long-term success ultimately will depend in large part on whether the
    beneficiary countries continue the economic reforms begun under this
    initiative and remain committed to the alleviation of poverty and
    support of social programs.

      Developed and Expanded Programs to Assist African Countries: The HIPC
    debt reduction initiative is just one of a series of measures that this
    Administration has undertaken during the past several years to assist
    sub-Saharan African countries to strengthen their economies and deal
    with difficult economic, social, political, and environmental
    conditions. These initiatives have been a response to the clear
    understanding that many countries in sub-Saharan Africa have failed to
    participate in the benefits of the growing economic globalization.
    Rather, these countries have failed over the past three decades to
    sustain positive, real, per-capita economic growth, with serious
    negative consequences for their populations. In addition to debt
    reduction, some of the key measures undertaken by the Administration to
    assist sub-Saharan Africa have included:
      the increase in bilateral assistance levels, and the economic,
              social, and political programs they support, back to past peak
              levels;
      the passage of the African Growth and Opportunity Act, which,
              by reducing U.S. tariffs on goods from sub-Saharan African

    [[Page 57]]

              countries as well as other measures, seeks to encourage
              increased trade and investment between the United States and
              sub-Saharan African countries;
      the implementation of the Africa Trade and Investment Policy
              Program, which helps reform-oriented African countries to
              improve the enabling environment for trade and private
              investment;
      the provision of disaster assistance to countries seriously
              impacted by natural disasters, including $160 million to
              respond to flooding in southern Africa in 2000; and,
      the rapid scaling up in 2000 and 2001 of broader HIV/AIDS
              initiatives to combat the pandemic in south and eastern
              Africa.
      The results of these efforts are somewhat mixed--while South Africa
    successfully ended apartheid and Mozambique peacefully concluded its
    decades-long civil war, civil strife continues in Sierra Leone, the
    Democratic Republic of the Congo, and other countries. However, the
    outrage expressed by African, as well as Western, countries at the
    recent military coup in Cote d'Ivoire is an encouraging sign that more
    and more Africans expect their governments to adhere to the rule of law
    and improve their standards of living.

    Grappled with Global Problems

      Increased AIDS Awareness, Development of Preventative and Ameliorative
    Programs: The HIV/AIDS pandemic is the defining public health crisis of
    our time, which threatens to undo four decades of progress in
    international development. At the start of the 1990s, health experts
    estimated that between 15 and 20 million people would be living with HIV
    by the beginning of the 21st Century. Ten years later, the true
    magnitude of the epidemic is far more alarming: over 36 million people
    are living with HIV; and, HIV/AIDS prevalence among adults exceeded 20
    percent in seven countries in sub-Saharan Africa. In the hardest hit
    African countries, infant mortality is twice as high as it would have
    been without AIDS.
      The U.S. Government has been the world leader in responding to the
    global pandemic of AIDS. Since 1993, the United States, through USAID,
    has dedicated over $1.5 billion for the prevention and mitigation of
    this epidemic in the developing world. USAID's support was instrumental
    in reducing the prevalence of HIV in Uganda and Zambia and in
    stabilizing low HIV prevalence rates in Senegal, Philippines, and
    Indonesia. By 1999, however, it became apparent that international
    efforts to combat the HIV pandemic needed to be stepped up and the U.S.
    Government responded. The United States' global AIDS funding has
    increased from $139 million in 1999 to an estimated $455 million in
    2001. These increases are focused on high- prevalence countries and low-
    prevalence countries at risk of impending epidemics in sub-Saharan
    Africa, Asia, and Latin America, where countries have been selected for
    ``rapid scale-up'' and ``intensive focus'' under the Leadership and
    Investment in Fighting an Epidemic initiative. The U.S. Government
    effort has brought together a host of Federal agencies in the first ever
    Government-wide mobilization against AIDS.

      Kyoto Protocol and Related Environmental Programs: Global climate
    change is one of the most far-reaching threats to sustainable
    development worldwide. As the world's number one emitter of greenhouse
    gasses, the United States has recognized the need to work with
    developing countries to stem global climate change. The Administration
    announced at the UN in 1997 a plan to invest $1 billion over the next
    five years in programs and activities to help developing countries to
    reduce greenhouse gas emissions, and the 2001 appropriation funds the
    fourth tranche of this commitment. USAID is also addressing other
    critical global environmental challenges such as clean energy, natural
    resources management, and biodiversity conservation, for which the 2001
    appropriation provides a significant increase in funding.
      President Clinton signed the Kyoto Protocol in November 1998,
    reaffirming the Administration's commitment to work with other countries
    to meet the challenge of global warming. The Kyoto Protocol is an
    historic step forward in international efforts to address global
    warming, incorporating environmental targets with market-based
    mechanisms to minimize the cost of meeting them. However,

    [[Page 58]]

    ratification of the Protocol requires passage by the U.S. Senate.
    Lasting progress in combating global warming will require ratification
    by the United States, as well as meaningful participation by key
    developing countries in addressing climate change.

    Protected American Lives and Changed America's Foreign Policy Machinery

      Greatly Expanded Embassy Security: As the President stated on the
    second anniversary of the bombing attacks on our embassies in Nairobi
    and Dar es Salaam on August 7, 1998, the terrorists took from us our
    colleagues, friends, and loved ones, but they have failed utterly to
    deter us from advancing our principles around the world. Addressing the
    security vulnerabilities of the Nation's diplomatic presence has been
    given the highest priority. Since the embassy bombings, the
    Administration has embarked upon an unprecedented program of security
    initiatives around the world. It initiated a long-term capital program,
    because it will take a multi-year effort to address these
    vulnerabilities and proposed advanced appropriations of $3.4 billion
    over the 2002-2005 period to sustain that program. Efforts have focused
    on bringing our diplomatic facilities up to heightened security
    standards and on maintaining necessary security upgrades. These have
    included enhanced local guard services, physical security equipment and
    technical support upgrades, increased deployment of armored vehicles,
    increases in American security personnel, security and crisis management
    training, and a worldwide program to build new, secure facilities.
      Through 2001, the Administration has invested about $3 billion in this
    effort. These funds have been used to upgrade comprehensively the
    security at our overseas facilities, including enhancing the physical
    security at U.S. missions through construction projects, the
    installation of security equipment, inspecting all vehicles entering
    U.S. diplomatic facilities, expanding anti-terrorism assistance training
    to aid foreign police in combating terrorism, and hiring additional
    diplomatic security agents. These funds are also being used to support
    the initial stages of a worldwide embassy security construction program
    with a goal of replacing up to 220 diplomatic and consular facilities
    worldwide with new, secure buildings. A major challenge currently being
    addressed is the need to pursue fully regional efficiencies and security
    planning that will have an impact on the need for overseas staffing. The
    results of such analysis then will be used to ensure that facility
    design addresses both the size and functional needs of all U.S.
    Government staffing needs at each location.

      Enhanced the Security of U.S. Borders: The Administration has
    implemented a comprehensive strategy to improve the Department of
    State's equipment, technology systems, and support needed to carry out
    the vital function of U.S. border security. Major initiatives over the
    last eight years have included a comprehensive, worldwide upgrade of
    computer equipment and consular systems at the Department's overseas
    posts; increased data sharing with other border security and law
    enforcement agencies; continued improvements to the automated name
    checking system capabilities; expanded implementation of the Border
    Crossing Card program in Mexico; and, modernization of the security and
    delivery of U.S. passports to American citizens, including completion of
    the initial deployment of passport photo digitization technology. These
    improvements were made possible by the establishment of a new fee paid
    by persons seeking non-immigrant visas for travel to the United States.
      Improved security has not come at the expense of customer service. To
    the contrary, under the Vice President's National Performance Review,
    reinvention goals have been met by eliminating long lines at high volume
    passport agencies and vastly increasing consular information and
    services available via the Internet. Appointment systems that allow
    customers to schedule a convenient time to apply for a passport are now
    installed at passport agencies in New York, Boston, Chicago, Houston,
    Los Angeles, Miami, Philadelphia, San Francisco, Seattle, Stamford, and
    Washington, D.C., and the Department of State has eliminated the
    requirement to stand in line while waiting for service by introducing
    customer-numbering systems. The Department of State's Consular Affairs
    web site (travel.state.gov) went on-line in 1996. Since then, the amount
    and variety of information on the site have grown enormously and it now
    includes downloadable passport

    [[Page 59]]

    applications, announcements and warnings on safety abroad that are
    posted on the web site immediately upon approval, tips for students and
    travelers, and other information and services to assist Americans
    abroad.

      Integrated the United States Information Agency (USIA) and the Arms
    Control and Disarmament Agency (ACDA) into the State Department: The end
    of the Cold War and efforts to reinvent Government provided the
    opportunity to seek a new approach to the conduct of foreign policy and
    a reorganization of foreign affairs agencies. Under the Foreign Affairs
    Reform and Restructuring Act of 1998, USIA and ACDA were consolidated,
    and the missions, personnel, and programs of these agencies were
    integrated into the State Department and the newly-independent
    Broadcasting Board of Governors, which was established as an independent
    executive branch agency. One year following the October 1, 1999,
    implementation of the Act, the integration of USIA's programs into the
    State Department has already strengthened U.S. foreign policy by making
    public diplomacy an integral component of foreign policy. ACDA's
    integration on April 1, 1999, has made the State Department better able
    to contribute to the coordination of foreign and security policy and
    deploy more effectively the broad tools of diplomacy to promote arms
    control and nonproliferation. As integration is fully implemented, the
    challenge remains to streamline activities and effectuate significant
    management improvements and resource reductions in years to come.

    Provided Multilateral Solutions to Multilateral Problems

      UN Reform and Arrears Clearance: The Administration, in cooperation
    with the Congress, has made substantial progress toward reducing U.S.
    arrears owed to the UN and bringing about badly needed reforms in that
    organization. The United States has used its influence to push for
    management improvements, organizational streamlining, and the budget
    discipline needed to ensure zero nominal growth in the UN and
    specialized agencies' budgets. The United Nations Reform Act of 1999
    provides the foundation for this process by conditioning U.S. payments
    for specific arrearage amounts to the implementation of reforms at the
    UN and reductions in the U.S. assessment rate for the UN regular,
    peacekeeping and other specialized agencies' budgets. The Administration
    obtained congressional approval for $926 million to be available upon
    those conditions being met. The first set of conditions was met last
    year, allowing an initial payment of arrears of $100 million. As a
    critical element in the effort to bring about the other reforms that
    must be achieved prior to releasing the remaining arrearage payments,
    the Administration successfully concluded negotiations to establish a
    new scale of assessments for UN dues that will reduce the U.S. share of
    the UN budget and result in substantial future budgetary savings.
      Expanded UN Peacekeeping: The Administration has used its leadership
    at the UN in support of a number of peacekeeping operations to contain
    flashpoints that threatened international security in Bosnia, Kosovo,
    East Timor, and other locations. UN peacekeeping operations have
    directly supported U.S. national interests by helping nurture new
    democracies, reducing refugee flows, and preventing small conflicts from
    developing into regional or international wars which would be far more
    costly in terms of lives and resources. The United States has been a
    driving force behind efforts to identify and implement reforms at the UN
    to improve the efficiency and efficacy of peacekeeping operations. As
    part of this process, the United States recently concluded negotiations
    with the other UN member countries to reduce the level of U.S.
    assessments for UN peacekeeping activities.
      Non-Proliferation: The Administration supported several initiatives in
    the area of non-proliferation.
      Enhanced Threat Reduction Initiative: Over the past eight years, the
    United States has provided extensive assistance to Russia and the other
    New Independent States (NIS) to help reduce the risk of proliferation of
    weapons of mass destruction and associated delivery systems, materials,
    technology and expertise, and to enhance regional stability. Such
    assistance has enabled Belarus, Kazakhstan, and Ukraine to become non-
    nuclear-weapons states and helped deactivate over 5,000 strategic
    nuclear warheads. The 1998 economic crisis in Russia and other NIS
    increased the risks of

    [[Page 60]]

    weapons and weapons expertise proliferation. In response, the
    Administration proposed the Expanded Threat Reduction Initiative in
    January 1999 to accelerate and expand non-proliferation assistance to
    the NIS. As a result, with congressional support, over $870 million was
    made available in 2000 and 2001 for high priority non-proliferation
    programs of the Departments of Defense, Energy, and State. These
    programs have enhanced nuclear material security at tens of NIS sites;
    provided thousands of former Soviet weapons scientists employment
    opportunities in peaceful research and development ventures; enhanced
    border controls; and provided other assistance to reduce regional and
    global threats. Success in continuing to reduce such threats will be
    dependent upon continued cooperation between Russia, the other NIS, and
    the West to address global security concerns raised by economic
    uncertainty in the region.
      Korean Peninsula Energy Development Organization (KEDO): The United
    States has been committed to preventing the destabilizing manufacture
    and deployment of nuclear weapons by North Korea. Through focused
    diplomatic efforts, the United States and North Korea concluded in
    October 1994 an Agreed Framework to address concerns about the
    intentions of North Korea's nuclear program. Under the terms of the
    Agreed Framework, the United States pledged to assist North Korean
    civilian energy requirements--with non-proliferation safeguards--through
    the newly created KEDO in exchange for North Korean termination of its
    own nuclear program and for coming into line with international nuclear
    non-proliferation norms. Since the conclusion of the Agreed Framework,
    the United States has worked with the North Koreans toward full
    implementation, which has also led to improved relations between the
    countries, culminating in the visit of the Secretary of State to North
    Korea in the fall of 2000.
      Other Non-Proliferation Successes: More generally, the United States
    has invested in major efforts over the last eight years to strengthen
    the international regimes aimed at curbing weapons of mass destruction
    and ballistic missiles. In 1995, the Nuclear Non-Proliferation Treaty,
    which originally was set to last only twenty-five years, was extended
    indefinitely. In 1997, the Chemical Weapons Convention, which prohibits
    the development, production, transfer, and use of chemical weapons,
    entered into force following ratification by the U.S. Senate. While
    Senate ratification for the Comprehensive Test Ban Treaty remains to be
    secured, 160 countries have signed--and 67, including Russia, have
    ratified--this treaty prohibiting all nuclear explosions. At the same
    time, the United States has led the drive to strengthen both the nuclear
    safeguards system administered by the International Atomic Energy Agency
    and the constraints on biological weapons embodied in the Biological and
    Toxin Weapons Convention.

    Responded to Humanitarian Crises

      Aggressive Responses to Hurricanes Mitch and Georges: In response to
    Hurricanes Mitch and Georges, which devastated Central America and the
    Caribbean, respectively, in the fall of l998, the U.S. Government
    civilian and military authorities cooperated to mount quickly and
    effectively one of the largest emergency relief responses to an
    international natural disaster in U.S. history. In the space of a few
    months, the United States provided supplies and food to millions of
    victims, as well as to effect emergency repairs to bridges, roads, and
    schools. In May 1999, the Congress approved the Administration's request
    for $956 million in supplemental funds for the Central American and
    Caribbean countries affected by the hurricanes. It contained $621
    million in reconstruction assistance to replace lost housing,
    rehabilitate damaged schools, implement disaster mitigation and
    watershed restoration, and support local governments. More than $100
    million of the funding is being implemented with the cooperation of 12
    other U.S. agencies including the Department of Transportation,
    Department of Health and Human Services, Peace Corps, and the U.S. Army
    Corps of Engineers.