[Senate Report 105-394]
[From the U.S. Government Publishing Office]
Calendar No. 715
105th Congress Report
SENATE
2d Session 105-394
_______________________________________________________________________
SILK ROAD STRATEGY ACT OF 1998
_______
October 9 (legislative day, October 2), 1998.--Ordered to be printed
_______________________________________________________________________
Mr. Helms, from the Committee on Foreign Relations,
submitted the following
R E P O R T
together with
MINORITY VIEWS
[To accompany S. 1344]
The Committee on Foreign Relations, to which was
referred S. 1344 to amend the Foreign Assistance Act of 1961 to
target assistance to support the economic and political
independence of the countries of the South Caucasus and Central
Asia, reports favorably thereon with an amendment and
recommends that the bill do pass.
CONTENTS
Page
I. Purposes of the Bill.............................................1
II. Committee Action................................................20
III. Section-by-Section Analysis.....................................21
IV. Cost Estimate...................................................23
V. Evaluation of Regulatory Impact.................................24
VI. Changes in Existing Law.........................................24
VII. Minority Views..................................................31
I. Purposes of the Bill
introduction
The Silk Road Strategy Act is necessitated by the failure
of current U.S. policy and assistance laws to resolve regional
conflicts or effectively advance American interests in the
South Caucasus and Central Asia. Seven years after the collapse
of the Soviet Union, the Silk Road Strategy Act establishes a
policy framework that elevates and differentiates Armenia,
Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Tajikistan,
Turkmenistan and Uzbekistan from the status of ``former Soviet
republics'' and ``newly independent states''. The very use of
these labels by U.S. policy makers has frustrated states in the
South Caucasus and Central Asia that view themselves as
permanently independent and sovereign countries. Most of these
states--including several pro-Western, secular Muslim
governments--are racked by civil wars, ethnic tensions, and
weak and undemocratic regimes. They are falling dangerously
behind in both economic and democratic reforms, which in turn
provides an opening for attempts by regional powers and sub-
regional forces to undermine their very sovereignty.
The countries in the South Caucasus and Central Asia have
almost without exception shown a strong desire to work with the
United States in pursuit of economic and democratic reforms.
Clearly, enormous economic gains are possible in several
countries in the region due to the presence of oil and gas
reserves. The goal of the United States should be to promote
economic and democratic reforms in the region while helping to
develop oil and gas resources in a manner that is beneficial to
all states in the region. Specifically, American interests in
the region are threefold: 1) to ensure the development of
stable, democratic states in the region, including the
resolution of regional conflicts; 2) to develop friendly
relationships among the states in the region and with the
United States and its allies; and 3) to ensure that the
economies and the natural resources of the region are developed
in a manner dictated by the market, rather than through
exploitation by regional, hegemonic powers.
The Silk Road Strategy Act will not lead to any immediate
increase in foreign assistance to the South Caucasus and
Central Asia. The goal of the legislation is to properly focus
U.S. assistance to better achieve U.S. interests. The
legislation provides general authorization for a broad range of
U.S. assistance to promote reconciliation and recovery from
regional conflicts; to foster economic growth and development,
including the conditions necessary for regional economic
cooperation; to develop regional infrastructure; to secure
borders and implement effective controls necessary to prevent
smuggling of illegal narcotics and the proliferation of
technology and materials related to weapons of mass
destruction; and to promote institutions of democratic
government and create the conditions for the growth of
pluralistic societies. As these programs develop, in a regional
context, the Silk Road Strategy can be the means to bring
peace, stability and economic development to the South Caucasus
and Central Asia.
The goal of regional cooperation, which is the underlying
rationale for the Silk Road Strategy Act, has drawn the support
of every government in the South Caucasus and Central Asia with
the exception of Armenia, as well as the governments of close
American allies such as Turkey, Ukraine, and Romania. The
legislation is endorsed by a broad coalition of organizations,
including the Women's Commission for Refugee Women and
Children, the American Petroleum Institute, the National
Association of Manufacturers, the National Foreign Trade
Council, the United States Chamber of Commerce, the Georgian
American Community, the American Jewish Committee, the American
Jewish Congress, the Anti- Defamation League, B'nai B'rith, and
the National Conference on Soviet Jewry.
The authorities in the Silk Road Strategy Act complement
and build upon the authorities included in the Freedom Support
Act (the law currently governing U.S. assistance to the
thirteen independent nations that once composed the Soviet
Union), while creating a regional focus for U.S. policy in the
South Caucasus and Central Asia. The legislation encourages a
re-energized U.S. assistance initiative in the region while
maintaining a strong emphasis on democratic reform and human
rights. In fact, the restrictions on assistance included in
Section 499E of the Silk Road Strategy Act are, verbatim, the
same restrictions on assistance that are included in the
Freedom Support Act. In a May 19, 1998, letter to the Foreign
Relations Committee, the Department of State offers the Clinton
Administration's unqualified support for the Silk Road Strategy
Act which ``provides a useful framework for U.S. interests in
the Southern Caucasus and Central Asia.'' The letter goes on to
state that, in the view of the Administration, ``(t)his Act
builds upon the Freedom Support Act and highlights America's
interests in this region.''
Under the Freedom Support Act, U.S. assistance in the
region has been skewed by earmarks, rigid restrictions and,
especially, an absence of correlation between dollar amounts
and results in economic or democratic reforms. For example, the
only country in the region recognized as having conducted a
fully free and fair election, Georgia, has received less than
half of the total assistance--and less than a quarter on a per
capita basis--provided to Armenia since 1992. Yet, in a
critique of democratic progress in Armenia, a February 3, 1998,
Human Rights Watch report reveals that the resignation of the
Armenian President earlier this year was in fact forced by a
powerful Armenian militia group. Furthermore, according to the
April 1998 Digest of the Commission on Security and Cooperation
in Europe (CSCE), the subsequent March 1998 presidential
election in Armenia did not meet the standards of the
Organization on Security and Cooperation in Europe (OSCE). In
fact, according to the CSCE report, ``(s)ince the 1991 election
of Levon Ter-Petrossyan, Armenia has not held an election that
the OSCE/ODIHR observation missions have been able to certify
as free and fair''.
Other governments in the region have also failed to
implement democratic reforms. The government of Azerbaijan is a
case in point. Opposition candidates intend to boycott the
Azerbaijani presidential election scheduled for October 11,
1998, due to a lack of confidence in an electoral process
solely under the control of the incumbent president.
Ironically, until 1996, the government of Azerbaijan was
prevented by the Freedom Support Act from receiving any U.S.
assistance, including technical assistance designed
specifically to promote the development in democratic
institutions and sound election laws. In a June 1998 letter to
the Congress, the five leading opposition candidates in
Azerbaijan made an explicit appeal for the lifting of
assistance restrictions against Azerbaijan as an essential step
for encouraging democratic development of their country.
The Clinton Administration has repeatedly requested that
the Congress allow broader U.S. assistance to Azerbaijan,
pointing out that critics of corruption and undemocratic
tendencies in the government of that country have
simultaneously blocked the very assistance that could
facilitate reforms. According to the Department of State, anti-
corruption assistance, counter-narcotics programs, economic
reform assistance (including transparency in budgeting and tax
reform), and funding of regional environmental cooperation
programs are all prohibited to the Government of Azerbaijan
under Section 907 of the Freedom Support Act.
East-West versus North-South: The Silk Road Strategy
The Silk Road Strategy Act establishes a regional approach
for U.S. trade, economic assistance and foreign policy
specifically to build an East-West axis of political
cooperation among the eight countries that lie between Russia
and Iran on the southern periphery of the former Soviet Union.
Efforts to resolve conflicts in the region are at a standstill,
economic and democratic reforms are slowing, and Russia and
Iran are fomenting instability in order to establish political
influence over those states.
Russian and Iranian mischief can be attributed to a mutual
desire to expand political control in the South Caucasus and
Central Asia while seeking to maintain control over the flow of
oil and gas resources from the region. Senior officials from
Russia and Iran meet frequently to coordinate their interests
in the South Caucasus and Central Asia. At a June 27, 1998,
meeting between the Transportation Ministers of Russia and
Iran, a plan was announced to develop a North-South economic
corridor between the two countries. On July 19, 1998, the
governments of those two countries reiterated their intention
to frustrate efforts to delimit the ownership of resources in
the Caspian Sea. Meanwhile, Russia has used its exclusive
control of existing oil and gas pipelines to force economic and
political concessions from neighboring states.
As part of the deepening relationship with Iran, the
Russian government has shown reckless disregard for the
proliferation of sophisticated weapons technology to that
country. According to an April 25, 1998, New York Times report,
the Russian government failed to stop ``a truck laden with 22
tons of stainless steel that could be used to make missiles''
that was on its way to Tehran, despite advance warning by the
United States Government. Fortunately, according to the report,
cooperative customs agents in Azerbaijan were willing to stop
the shipment before it entered Iran.
Promoting Human Rights
A leading challenge for United States policy in the South
Caucasus and Central Asia is to determine when to disengage and
when to use the broad array of U.S. assistance programs to
strengthen democratic institutions, encourage economic reforms,
and foster the development of civil society in countries that
otherwise have poor human rights records. Among the factors
that must weigh heavily in deciding U.S. policy in the South
Caucasus and Central Asia are the friendly, pro-American
receptivity found among most states in the region that could
allow democratic ideals to take root. Also, consideration must
be given to compelling U.S. geostrategic and economic interests
in the region, as well as the likelihood that U.S.
disengagement will do nothing to improve human rights while
regional powers such as China, Iran and Russia (countries with
human rights records of even more dubious quality than those in
the South Caucasus and Central Asia) increase their political
influence over those states.
There is no benefit in the Silk Road Strategy Act for those
who violate basic human rights. Section 499E of the Silk Road
Strategy Act specifically prohibits assistance to the
government of any country that ``is engaged in a consistent
pattern of gross violations of internationally recognized human
rights''. It is necessary to recognize that human rights
problems exist in every country in the region. Under existing
human rights statutes however, the Administration has not found
such violations to be sufficient to merit a cut-off of U.S.
assistance.
To some extent, human rights abuses, undemocratic
tendencies and authoritarian government can be attributed to
ongoing conflicts in the region, especially in Armenia,
Azerbaijan, Georgia and Tajikistan. Both Russia and Iran have
sought to exploit, and at times foment, instability in the
South Caucasus and Central Asia--a principal cause of
undemocratic behavior and abuse. Specifically, Russia has
provided covert and overt military assistance to fuel
separatist conflicts in Georgia and Azerbaijan, while Iran has
sought to impose an anti-Western, anti-Israeli orientation on
states in the region, including a direct threat by the Iranian
government upon the life of the President of Azerbaijan in
retaliation for warming Azerbaijani-Isreali relations. To this
day Russia harbors the mastermind of a 1995 assassination
attempt against Georgian President Eduard Shevardnadze. The
individual, Lt. General Igor Georgadze, was surreptitiously
flown out of a Russian military base in Georgia only days after
the assassination attempt.
When the Freedom Support Act was approved by the Congress
in 1992, few could have conceived that Russia would be actively
seeking to subvert the elected governments of neighboring
states within three years. In fact, while providing some
benefits to other eligible countries, the Freedom Support Act
has been most beneficial to Russia. Since 1992, Russia has
maintained its position as the leading recipient of aid under
the Freedom Support Act, despite perpetrating the single
greatest human rights abuse by any recipient of U.S. foreign
assistance in the region. The Russian military's brutal 1994-
1996 assault on the southern Russian region of Chechnya
resulted in the massacre of tens of thousands of innocent men,
women, and children, and has plunged the area into ongoing
chaos. Nonetheless, these atrocities had absolutely no impact
on the Clinton Administration's determination to continue
Russia's generous aid levels. No other state in the region has
come close to such horrific action, although the human rights
records of most are in need of substantial improvement.
It is clear, in fact, that the level of U.S. assistance to
countries in the region is most certainly not correlated with
the human rights records of the recipients to date. Listed
below is a simple comparison of aid levels and human rights
records, with a breakdown of total assistance provided to each
country in the South Caucasus and Central Asia from 1992-1997
(as provided in the State Department's 1998 ``Report on U.S.
Government Assistance to and Cooperative Activities with the
New Independent States of the former Soviet Union''), and the
most recent assessment of each country's human rights record by
the United States Department of State:
ARMENIA
U.S. Assistance Provided under the Freedom Support Act: $363.34
million
Population: 3,465,611
Per Capita Assistance 1992-1997: $104.84
Armenia has a constitutional government in which the
President has extensive powers of appointment and decree, and
the role of the legislature relative to the executive branch is
severely circumscribed. The President appoints the Prime
Minister, who is in charge of the Cabinet. President Levon Ter-
Petrossian was re-elected in a controversial multi-candidate
election in September 1996, which was flawed by numerous
irregularities and serious breaches of the election law. A
transitional National Assembly in which ruling Armenian
National Movement (ANM) members and their allies won about 88
percent of the seats was elected in July 1995; local and
international observers characterized these elections as
``generally free but not fair.'' To protest the presidential
elections, a number of opposition parties continue to boycott
parliamentary sessions. Both the Government and the legislature
can propose legislation. The legislature approves new laws and
can remove the Prime Minister by a vote of no confidence.
Elections for a new National Assembly are scheduled for 1999.
The Constitution provides for an independent judiciary;
however, in practice judges are subject to political pressure
from the executive branch. The Ministry of Internal Affairs and
National Security is responsible for domestic security,
intelligence activities, border control, and the national
police force. Oversight of the security services improved after
the merger of the Interior Ministry with the National Security
Ministry, but members of the security forces committed serious
human rights abuses.
The transition from a centralized, controlled economy to a
market economy continues to move forward. Industrial output
remains low, leaving over 50 percent of the population
unemployed or underemployed, with a high degree of income
inequality. Most small and medium enterprises have been
privatized, as has most agricultural land. About one-third of
permanent land titles had been issued by the end of the year.
Gains in the privatized trade, service, and agriculture sectors
generated an approximately 3 percent increase in gross domestic
product (GDP) in 1997, to about $550 per capita. However,
inflation rose to about 21.9 percent for the year. Foreign
assistance and remittances from Armenians abroad play a major
role in sustaining the economy.
The Constitution provides for broad human rights
protections, but human rights problems persist in several
important areas. The Government's manipulation of the 1996
presidential election continued to restrict citizens' ability
to change their government. Members of the security forces made
arbitrary arrests and detentions without warrants, beat
detainees during arrest and interrogation, and did not respect
constitutional guarantees regarding privacy and due process. At
least two cases of police abuse resulting in death occurred;
adequate institutional mechanisms do not exist to protect
individuals from police abuse. Prison conditions remained poor.
The judiciary is subject to political pressure and does not
enforce constitutional protections effectively. Opposition
groups charged that defendants in three major criminal cases
were political prisoners. The Government continued to place
some restrictions on freedom of the press and maintains the
dominant role in nationwide television and radio broadcasting.
A semi-official list of forbidden subjects encourages some
media self-censorship. However, the nongovernmental media often
criticize the country's leadership and policies. Local
independent television and newspapers, along with private radio
stations, continued to multiply.
The Government maintains some limits on freedom of
association. A previously suspended prominent political party,
the Armenian Revolutionary Federation (ARF/Dashnaks), was not
reinstated, although the authorities tolerated its activities,
restored its offices, and permitted publication of a Dashnak
newspaper. The legislature called into question its commitment
to constitutional provisions for freedom of religion, by
amending the law on freedom of conscience to further strengthen
the role of the Armenian Apostolic Church and create new
barriers to other denominations. The Government places some
restrictions on freedom of movement. Discrimination against
women, minorities, and the disabled remained a problem.
Efforts began in October to train current and prospective
judges and prosecutors on the draft civil and criminal law
codes, scheduled for passage in 1998.
AZERBAIJAN
U.S. Assistance Provided under the Freedom Support Act: $45.19
million
Population: 7,735,918
Per Capita Assistance 1992-1997: $5.84
Azerbaijan is a republic with a presidential form of
government. Heydar Aliyev, who assumed presidential powers
after the overthrow of his democratically elected predecessor,
was elected President in 1993. Although Azerbaijan took
significant steps toward economic reform in 1997, it made
little progress in moving toward democracy. President Aliyev
and his supporters, many from his home region of Nakhchivan,
continue to dominate the Government, the multiparty 125-member
Parliament chosen in the November 1995 elections, and the
judiciary. The Constitution, adopted in a November 1995
referendum, established a system of government based on a
division of powers between a strong presidency, a legislature
with the power to approve the budget and impeach the President,
and a judiciary with limited independence.
After years of inter-ethnic conflict between Armenians and
Azerbaijanis, Armenian forces and forces of the self-styled
``Republic of Nagorno-Karabakh'' (which is not recognized by
any government) occupy 20 percent of Azerbaijan's territory. A
cease-fire was concluded in 1994, and the peace process
continues. Serious clashes along the Azerbaijan-Armenian border
and along the line of contact with Nagorno-Karabakh in the
spring and summer caused scores of casualties. Military
operations continued to affect the civilian population. There
are 780,000 Azerbaijani refugees and internally displaced
persons (IDP's) who cannot return to their homes. In the part
of Azerbaijan that the Government controls. Government efforts
to hinder the opposition continue to impede the transition to
democracy. In the part of Azerbaijan that Armenians control, a
heavily militarized ruling structure prevents ethnic
Azerbaijanis from returning to their homes. Police, the
Ministry of Internal Affairs, and the Ministry of National
Security are responsible for internal security. Members of the
police committed numerous human rights abuses.
The economy is in transition from central planning to a
free market. A highly organized system of corruption and
patronage hampers economic development. The country has rich
petroleum reserves and significant agricultural potential. Oil
and oil products are the largest export, followed by cotton.
Other key industries are chemicals, oil field machinery, and
air conditioning equipment. However, most industry languishes
in a post-Soviet depression. The Government signed five oil
production sharing agreements with foreign oil companies in
1997, bringing the total to nine. In agriculture, which employs
35 percent of the labor force, the leading crops are cotton,
grapes, tea, and tobacco. The Government continued its policies
of fiscal and monetary austerity, inflation continued to fall,
and interest rates declined to less than half of 1996 levels.
The pace of privatization accelerated with the initiation of
auction sales of shares in large state-owned enterprises.
Privatization of the cotton gins ended the Government's
monopoly on trade in cotton. Privatization of farmland
continued, but new small farmers have poor access to credit and
markets, and commercial agriculture remains weak.
Per capita gross domestic product is about $300 per year.
According to the World Bank, 60 percent of citizens live in
poverty. Much of the labor force is ``employed'' by state
enterprises that operate at very low levels of capacity and pay
their workers intermittently if at all. The overall economic
situation of the average citizen remains precarious, although
in urban areas a growing moneyed class with trade and oil-
related interests has emerged. Economic opportunity depends on
connections to the Government. Severe disparities of income
have emerged that are partly attributed to patronage and
corruption.
The Government's human rights record continued to be poor,
and the Government continued to commit serious abuses. Police
beat persons in custody, and some beatings resulted in deaths.
Police also arbitrarily arrested and detained persons,
conducted searches and seizures without warrants, and
suppressed and refused to allow peaceful public demonstrations.
In most instances, the Government took no action to punish
abusers. In a variety of separate incidents, the Government
arrested at least 19 members of the opposition Azerbaijan
Popular Front Party. Prison conditions remained harsh. The
entire judiciary is corrupt, inefficient, and subject to
executive influence. The Government holds about 120 political
prisoners.
The Government tolerated the existence of many opposition
political parties, although it continued to refuse to register
some of them. The Government restricts citizens' ability to
change their government peacefully. The Government restricted
freedom of speech, press, assembly, association, religion, and
privacy when it deemed it in its interest to do so. Press
censorship continued, as did the Government's control over the
broadcast media. Discrimination against ethnic minorities and
societal discrimination and violence against women are
problems. Worker rights suffered a setback when managers in the
state-owned oil industry, without a vote of the union
membership, formed a progovernment union of oil and gas workers
to displace the independent union that had represented the
interests of workers in those industries.
Nevertheless, there were some positive signs. Scores of
opposition and independent newspapers continued to publish and
discuss a wide range of sensitive domestic and foreign policy
issues. The Government abolished military censorship and the
press began open discussion of the issue of censorship.
Opposition political parties carried on a variety of public
activities. After 4 years of internal exile, and 2 months of
confinement to a village, former president Elchibey returned to
Baku in October, 1997, and resumed full political activity.
Although critical of certain domestic human rights activists,
the Government was open to limited dialogue with domestic and
international human rights organizations. The Government
arrested two police officials for inflicting injuries on
detained personsthat resulted in death.
Cease-fire violations by both sides in the Nagorno-Karabakh
conflict increased. They resulted in injuries and deaths among
combatants and the taking of prisoners, including civilians.
Insurgent Armenian forces in Nagorno-Karabakh and the occupied
territories continued to prevent the return of IDP's to their
homes. This restriction resulted in significant human suffering
for hundreds of thousands of people.
GEORGIA
U.S. Assistance Provided under the Freedom Support Act: $141.02
million
Population: 5,174,642
Per Capita Assistance 1992-1997: $27.25
Georgia declared independence from the Soviet Union in
1991. Multi-party parliamentary elections followed a short-
lived military coup in 1992 that ousted the elected government
of Zviad Gamsakhurdia. In August 1995, Parliament adopted a
Constitution that provides for an executive branch that reports
to the President, a legislature, and an independent judiciary.
In November 1995, Eduard Shevardnadze was elected President,
and a new Parliament was selected in elections described by
international observers as generally consistent with democratic
norms except in the self-governing region of Ajaria. The
President appoints ministers with the consent of the
Parliament. The judiciary is subject to executive pressure.
Internal conflicts in Abkhazia and South Ossetia that
erupted in the early 1990's remain unresolved, although cease-
fires in both areas are in force. These conflicts, together
with problems created by roughly 250,000 internally displaced
persons (IDP's), pose the greatest threat to national
stability. In 1993 Abkhaz separatists won control of Abkhazia,
and most ethnic Georgians, a large plurality of the population,
fled the region. In 1994 Russian peacekeeping forces
representing the Commonwealth of Independent States (CIS)
deployed in the conflict area with the agreement of the
Government and the Abkhaz separatists. Despite the presence of
peacekeepers, there has been only very limited repatriation of
ethnic Georgian IDP's, apart from some spontaneous returns to
the Gali region of Abkhazia, where the security situation
remains unstable. A Russian peacekeeping force has been in
South Ossetia since June 1992. Repatriation to South Ossetia
has also been slow. The Government has no effective control
over either Abkhazia or South Ossetia. There were no large-
scale armed hostilities in South Ossetia or Abkhazia in 1997,
but the intensity and frequency of partisan warfare in Abkhazia
increased. Abkhaz and Georgian armed criminal bands were also
active in Abkhazia.
The Ministry of Interior (MVD) and Procuracy have primary
responsibility for law enforcement, and the Ministry of State
Security (MGB, formerly KGB) plays a significant role in
internal security. In times of internal disorder, the
Government may call on the army. Reformist, elected, civilian
authorities still maintain inadequate control of the law
enforcement and security forces. In particular, representatives
of the MVD and Procuracy committed serious human rights abuses.
The economy continued its turnaround, with a growth rate
estimated by the International Monetary Fund (IMF) at 10
percent. The economy is primarily agricultural. Foreign aid
remains an essential component of the economy. The country
began a second stage of economic reforms to complete the
transition to a free market economy, but the ongoing energy
crisis remains an obstacle to economic progress. The IMF
estimated annual per capita gross domestic product at over
$850.
The Government continued efforts to improve its uneven
human rights record, but serious problems remain. Police and
security forces routinely abuse and beat prisoners and
detainees, force confessions, and fabricate or plant evidence.
Inhuman prison conditions, along with abuse, led to deaths in
custody. Corrupt and incompetent judges seldom displayed
independence from the executive branch, leading to trials that
were neither fair nor expeditious. Law enforcement agencies
illegally interfered with citizens' right to privacy at times
and limited freedom of assembly, violently dispersing peaceful
rallies. The Government constrains some press freedoms.
Discrimination against women is also a problem.
Senior government officials openly acknowledged serious
human rights problems, especially those linked to law
enforcement agencies, and sought international advice and
assistance on needed reforms. However, while structural reforms
designed to improve respect for human rights continued to be
implemented, there was no change in the practices of the law
enforcement agencies.
Nevertheless, increased citizen awareness of democratic
values, and growth of civil society provided some check on the
excesses of law enforcement agencies. The Parliament challenged
the law enforcement agencies by forcing the resignation of the
Security Minister and by investigating charges of abuse.
Parliament passed a Law on the Courts designed to increase
judicial competence and independence as well as a new Criminal
Procedures Code that puts into effect constitutional
protections. Independent newspapers showed greater maturity and
a continued willingness to criticize government policies and
actions. The number, variety, and sophistication of independent
nongovernmental organizations (NGO's) grew, as did their
ability to speak out for, and defend the rights of, individual
citizens.
KAZAKHSTAN
U.S. Assistance Provided under the Freedom Support Act: $304.14
million
Population: 16,898,572
Per Capita Assistance 1992-1997: $18.00
The Constitution of Kazakhstan concentrates power in the
presidency. President Nursultan Nazarbayev is the dominant
political figure. The Constitution, adopted in 1995 in a
referendum marred by irregularities, permits the President to
legislate by decree and dominate the legislature and judiciary;
it cannot be changed or amended without the President's
consent. Presidential elections originally scheduled for 1996
did not take place, as President Nazarbayev's term in office
was extended to 2000 in a separate 1995 referendum, also marred
by irregularities. Under the 1995 Constitution, Parliament's
powers are more limited than previously. However, members of
Parliament have the right to introduce legislation. During the
Parliament's first full session, deputies drafted 19 bills for
consideration. The judiciary remained under the control of the
President and theexecutive branch. The lack of an independent
judiciary made it difficult to root out corruption, which was
pervasive throughout the Government.
In October as part of a larger government reorganization,
the law enforcement community was restructured. The Committee
for National Security (the KNB, successor to the KGB) is
responsible for counter-intelligence and law enforcement
activities on the national level. A new external intelligence
service, Barlau (the Kazakh word for intelligence), was created
to supervise overseas operations. Both report directly to the
President. The Ministry of Internal Affairs supervises the
criminal police who are poorly paid and widely believed to be
corrupt. The State Committee for Investigations (GSK), a
federal investigative and law enforcement agency established in
1995, was dissolved. Its functions were divided between the
Interior Ministry and the KNB. The KNB continued efforts to
legitimize its role by focusing on activities to combat
terrorism and organized crime. Members of the security forces
committed human rights abuses.
Kazakhstan is rich in natural resources, chiefly petroleum
and minerals. The Government has made significant progress
toward a market-based economy since independence. After a 5-
year decline, overall production began to increase in 1996. The
Government has been successful in stabilizing the local
currency (tenge), slowing inflation, and improving structural
reforms. The agricultural sector, traditionally accounting for
over one-third of national employment and production, has been
slow to privatize. The Government successfully privatized most
small- and medium-size firms, and is working to privatize
large-scale industrial complexes, particularly in the oil and
gas sector. However, living standards for many citizens
continue to decline. According to several surveys, up to 35
percent of citizens live below the government-defined poverty
line of $50 per month.
The Government generally respected the human rights of its
citizens in some areas, but serious problems remain in others.
Democratic institutions are weak. The Government infringed on
citizens' right to change their government. The legal
structure, including the Constitution adopted in 1995, does not
fully safeguard human rights. Members of the security forces
often beat or otherwise abused detainees, and harsh prison
conditions continued to deteriorate. There were allegations of
arbitrary arrest, and prolonged detention is a problem. The
judiciary remains under the control of the President and the
executive branch, and corruption is deeply rooted. The
Government infringed on citizens' rights to privacy.
The Government generally tolerates independent media,
although the media practiced self-censorship, and the
Government maintained control of most printing presses and
facilities. Freedom of assembly was sometimes restricted. Some
organizers of unsanctioned demonstrations were arrested and
fined or imprisoned. Freedom of association, while generally
respected, was sometimes hindered by complicated and
controversial registration requirements for organizations and
political parties that restrict this right. Domestic violence
against women remained a problem. There was discrimination
against women, the disabled, and ethnic minorities. The
Government discriminated in favor of ethnic Kazakhs. The
Government tried to limit the influence of independent trade
unions, both directly and through its support for state-
sponsored unions, and members of independent trade unions were
harassed.
KYRGYZSTAN
U.S. Assistance Provided under the Freedom Support Act: $133.93
million
Population: 4,540,185
Per Capita Assistance 1992-1997: $29.50
The Kyrgyzstan became an independent state in 1991.
Although the 1993 Constitution defines the form of government
as a democratic republic with substantial civil rights for its
citizens, the President, Askar Akayev, dominates the
government. Akayev was reelected in December 1995 in an open,
multi-candidate presidential election, which was marred,
however, by deregistration of three rival candidates
immediately prior to the vote. Also in 1995, a new, two-chamber
Parliament was elected for a 5-year term. The Constitution was
amended by referendum in February 1996 to strengthen
substantially the presidency and define the role of Parliament.
However, the referendum was marred by serious irregularities.
In 1995 a Constitutional Court was sworn in, and a reform
program was implemented to improve the quality of the judiciary
in 1996. While Parliament has become increasingly active, the
balance of power resides in the office of the President. The
judiciary is dominated by the executive branch.
Law enforcement responsibilities are divided between the
Ministry of Internal Affairs (MVD) for general crime, the
Ministry of National Security (MNB) for state-level crime, and
the procurator's office for both types of crime. Both the MVD
and the MNB deal with corruption and organized crime. These
ministries inherited their personnel and infrastructure from
their Soviet predecessors. Both appear to be under the full
control of the Government and usually conform their actions to
the law. Kyrgyz borders are manned by Russian border troops
under an agreement with the Russian Federation. The Government
has little authority over these troops, who sometimes enforce
their own rules rather than Kyrgyz law.
The Kyrgyzstan is a poor, mountainous country with a
predominantly agricultural economy. Cotton, wool, and meat are
the main agricultural products and exports. Other exports
include gold, mercury, antimony, uranium, and hydro-
electricity. The Government has carried out progressive market
reforms. The moderate growth apparent in most sectors has
increased, and economic reform is now accepted by the general
public. However, the level of hardship for pensioners,
unemployed workers, and government workers with salary arrears
continues to be very high. Foreign assistance plays a
significant role in the country's budget.
The Government generally respected the human rights of its
citizens in many areas, but there were problems with citizens'
limited ability to change their government, freedom of speech
and the press, due process for the accused, religious freedom,
and ethnic discrimination. Prison conditions remained poor. As
in the past, but with increasing frequency, journalists were
tried, arrested, and convicted under criminal rather than civil
statutes for libeling government officials or other prominent
citizens. However, in a number of cases journalists received
reduced sentences on appeal or by pardon. At year's end, a
journalist who previously was serving a sentence under criminal
libel had been amnestied, but eight other cases were announced
by the President's press secretary as pending. In a number of
cases, the accused were held for months without bail before
their trials.
The Constitution was amended illegally in a 1996 referendum
marred by irregularities. In general executive domination of
the judiciary made assurances of due process problematic. Local
``village elders' courts'' levied harsh sentences beyond their
mandate, but abuses such as torture and death sentences by
stoning apparently have abated. Although sanctioned by the
Government, elders' courts are not part of the regular judicial
structure, and the Government has made efforts to curtail their
activities. The Government does not fully protect freedom of
religion. Concerns about ethnic discrimination remain, but in
general, the situation of minorities has improved and
emigration rates have stabilized at a low level. Violence
against women is a problem that authorities often ignore. There
are a growing number of street children.
TAJIKISTAN
U.S. Assistance Provided under the Freedom Support Act: $28.64
million
Population: 6,013,855
Per Capita Assistance 1992-1997: $4.76
Tajikistan remains in the hands of a largely authoritarian
government, although it has established some nominally
democratic structures. The Government's narrow base of support
limits its ability to control the entire territory of the
country. The Government of President Emomali Rahmonov,
comprised largely of natives of the Kulob region, continued to
dominate the State.
Tajikistan took a significant step toward national
reconciliation after its 1992 civil war, with the signing of a
comprehensive peace accord in June, and the inauguration of a
Commission on National Reconciliation in July in Moscow. An
amnesty agreement and accord on exchange of prisoners also were
signed; the Commission on National Reconciliation met in Moscow
in July, before moving to Dushanbe in September. Despite the
agreement, the United Nations Mission of Observers to
Tajikistan (UNMOT) reported two cease-fire violations in
August. Under the peace accords, the opposition is allotted 30
percent of government positions but as of year's end, the
Government still had not given the opposition any positions.
The judiciary is not independent.
Internal security is the responsibility of the Ministries
of Interior, Security, and Defense. The Russian Army's 201st
Motorized Rifle Division, part of a Commonwealth of Independent
States (CIS) peacekeeping force established in 1993, remained
in the country. The Russian Border Guard Force (RBF) reports to
Moscow, has primary responsibility for guarding the border with
Afghanistan, and is comprised mostly of Tajiks with some
Russians and a limited number of other Central Asians, although
the officer corps remains principally Russian. Some regions of
the country remained effectively outside the Government's
control, and government control in other areas existed only by
day, or at the sufferance of local opposition commanders.
Opposition forces based near Kofarnihon, east of Dushanbe,
carried out a variety of attacks during the year. Some members
of the security forces and government-aligned militias
committed serious human rights abuses. The armed opposition
also committed serious human rights abuses, including
abductions and murders. There have been credible reports of
threatening, extortion and abuse of civilian populations by
both government and United Tajik Opposition units.
The economy continued to be extremely depressed, and
government revenue remains highly dependent on the government-
owned aluminum and government-dominated cotton industries.
Economic reform has been halting. Most Soviet-era factories
operate at a minimal level, if at all, while privatization has
moved ahead only slowly. As much as one-third of the total
population is unemployed or significantly underemployed
according to government estimates. Inflation increased during
1997, and the exchange rate declined substantially as the
Government failed to maintain fiscal and budgetary discipline.
Many, but not all, wages and pensions are being paid. However,
because most yearly salary percentage increases are still
meager and do not keep up with inflation, the sums remain
extremely low and not enough to support adequate nutrition
without supplemental income. Gross domestic product increased
marginally, but remained as low as $200-$400 per person,
according to official statistics. There were serious shortages
of natural gas for heating and industry, largely as a result of
continued disputes with Uzbekistan over natural gas purchases.
Wheat acreage and the total harvest continued to increase
dramatically as privatized farmers responded to their own and
market needs for increased production, although state farm
harvests continue to be mediocre.
The Government's human rights record improved slightly, due
principally to the reduced level of violence and the absence of
widespread military conflict; however, serious problems remain.
The Government limits citizens' right to change their
government. Some members of the security forces were
responsible for killings and beatings, and often abused
detainees. These forces were also responsible for threats,
extortion, looting, and abuse of civilians. Certain battalions
of nominally government forces operated quasi-independently
under their various leaders, who generally have government
positions. These forces committed similar abuses. The
government prosecuted few perpetrators for these abuses. Prison
conditions remain life threatening, and the Government
continued to use arbitrary arrest and detention. Basic problems
of rule of law persist. There are often long delays before
trials, and the judiciary is subject to political and
paramilitary pressure. The authorities infringe on citizens'
right to privacy. There has been public criticism of corrupt or
criminal actions by Ministry of Interior employees, several
dozen of whom were removed from their positions during the
year.
The Government severely restricts freedom of the press,
restricts freedom of speech, and dominates the electronic
media. No genuine opposition media appeared during the year,
and the Government suspended and harassed independent local
television stations. The authorities strictly control freedom
of assembly and association for political organizations.
Freedom of assembly is hindered. Two new political parties were
allowed to register, bringing the total to 11; the three
opposition parties and a branch of the fourth affiliated with
the armed opposition remained suspended. The Government
cooperated to a limited extent with the Organization on
Security and Cooperation in Europe (OSCE) in Dushanbe, but did
not establish a human rights ombudsman as recommended by the
OSCE. The Government also did not establish its own ombudsman,
despite its statement in 1996 that it would do so. Violence
against women is a problem.
Several armed clashes among ostensible government
supporters occurred, resulting in civilian deaths, abuse, and
property damage. The general weakness of government control and
continuing decline in social order led to an increase in crime
and violence, including politically-inspired violence.
The armed opposition committed numerous serious abuses.
Opposition forces were responsible for killings, kidnapings,
abuse, threats, and extortion, including against civilians.
Following the collapse of the Soviet Union and the
independence of Tajikistan in 1991, regional, political, and
religious tensions led to a brief but violent civil war in
1992-93. A low scale guerrilla war continued until late 1996,
led by a coalition of regionally based, democratic and Islamic
groups, with a political base and refugee population in
northern Afghanistan, against the winners of the civil war, a
loose coalition of also regionally based, but more politically
traditional, that is Communist, elements. By June a series of
accords had been signed ending the civil strife and pointing to
elections in 1998.
TURKMENISTAN
U.S. Assistance Provided under the Freedom Support Act: $18.84
million
Population: 4,225,351
Per Capita Assistance 1992-1997: $4.46
Turkmenistan, a one-party state dominated by its President
and his closest advisers, made little progress in moving from a
Soviet-era authoritarian style of government to a democratic
system. Saparmurad Niyazov, head of the Turkmen Communist Party
since 1985 and President of Turkmenistan since its independence
in October 1990, may legally remain in office until 2002. The
Democratic Party, the renamed Communist Party, retained a
monopoly on power; the Government registered no parties in 1997
and continued to repress all opposition political activities.
Emphasizing stability and gradual reform, official nation-
building efforts focused on fostering Turkmen nationalism and
glorification of President Niyazov. In practice the President
controls the judicial system, and the 50-member unicameral
Parliament (Mejlis) has no genuinely independent authority.
The Committee on National Security (KNB) has the
responsibilities formerly held by the Soviet Committee for
State Security (KGB), namely, to ensure that the regime remains
in power through tight control of society and discouragement of
dissent. The Ministry of Internal Affairs directs the criminal
police, which works closely with the KNB on matters of national
security. Both operate with relative impunity and have been
responsible for abusing the rights of individuals as well as
enforcing the Government's policy of repressing political
opposition.
Turkmenistan is largely desert with cattle and sheep
raising, intensive agriculture in irrigated oases, and huge oil
and gas reserves. Its economy remains dependent on central
planning mechanisms and state control, although the Government
has taken a number of potentially significant steps to make the
transition to a market economy. Agriculture, particularly
cotton cultivation, accounts for nearly half of total
employment. Gas, oil and gas derivatives, and cotton account
for almost all of the country's export revenues. Seeking
increased outlets for its gas exports (and, thereby, greater
economic independence), the Government is considering
construction of new gas export pipelines to or through a number
of countries, including neighboring Iran and Afghanistan.
The Government continued to commit human rights abuses, and
the authorities in particular severely restricted political and
civil liberties. Citizens do not have the ability to change
their government peacefully. Dissident Durdymurad Khodzha-
Mukhammed remains in a psychiatric hospital in Geok-Depe, and
dissident Ata Aymamedov is still imprisoned for calling for the
President's removal from office. Senior government officials
failed to respond to inquiries regarding these two cases.
Security forces continued to beat and otherwise mistreat
suspects and prisoners, and prison conditions remained poor and
unsafe. Arbitrary arrest, detention, unfair trials, and
interference with citizens privacy remained problems. The
Government completely controls the media, censoring all
newspapers and rarely permitting independent criticism of
government policy or officials. The Government generally gave
favored treatment to ethnic Turkmen over minorities and to men
over women. Women experience societal discrimination, and
domestic violence against women is a problem.
The recently amended law on religion reaffirmed a number of
important religious freedoms but also tightens government
control of religious groups. The requirement that religious
organizations have at least 500 members to be legally
registered has prevented some minority religions from legally
establishing themselves.
The Institute for Democratization and Human Rights, given a
mandate to conduct research in support of the democratization
of the Turkmen government and society and to monitor the
protection of human rights, completed its first year of
operation in October, 1997. During the year, it continued to
develop its research and monitoring activities. Early in 1997,
it conducted inspections of prisons, and several reforms
resulted from these inspections.
UZBEKISTAN
U.S. Assistance Provided under the Freedom Support Act: $82.21
million
Population: 23,860,452
Per Capita Assistance 1992-1997: $3.45
Uzbekistan is an authoritarian state with limited civil
rights. The Constitution provides for a presidential system
with separation of powers between the executive, legislative,
and judicial branches. In practice President Islam Karimov and
the centralized executive branch that serves him remain the
dominant forces in political life. The Oliy Majlis (Parliament)
is dominated by the executive branch, and only parties that
support the President are represented. Although the
Constitution provides for an independent judicial authority, in
practice the judicial branch is heavily influenced by the
executive branch in civil and criminal cases.
The police are controlled by the Ministry of Interior
(MVD). The police and related MVD forces are responsible for
most normal internal police functions. The National Security
Service (NSS)--the former KGB--deals with a broad range of
national security questions, including corruption, organized
crime, and narcotics. The army and border guards are
responsible for external defense. They are not routinely used
in internal disturbances and rarely are implicated in human
rights abuses. The police and the NSS committed numerous,
serious human rights abuses.
The Government continued to move toward market reform,
especially through improvement in the legislative framework.
However, restrictions continue on currency convertibility and
other financial steps which have led to suspension of
international loans. The economy is based primarily on
agriculture and agricultural processing; Uzbekistan is the
world's fifth largest producer of cotton, the seventh largest
producer of gold and has substantial deposits of copper,
strategic minerals, gas, and oil. The Government has proclaimed
its commitment to a gradual transition to a free market
economy. It has achieved substantial progress in reducing
inflation and the budget deficit. However, progress on
privatization of the large state-owned enterprises that account
for the bulk of gross domestic product remained slow, and a
host of formal and informal barriers continued to constrain the
nascent private sector.
The Government's human rights record remained poor, and
there were serious problems in several areas. Citizens cannot
exercise their right to change their government peacefully.
Chosen president in a 1991 election that most observers
considered neither free nor fair, Karimov had his stay in
office extended to 2000 by a 1995 Soviet-style referendum.
Parliament subsequently voted to make the extension part of
Karimov's first term, thus making him eligible to run again in
2000. Police and NSS forces used torture, harassment, illegal
searches, and wiretaps, and arbitrarily detained or arrested
opposition activists on false charges. They committed these and
other abuses against both dissidents and other citizens,
although reported abuses against dissidents decreased sharply.
Arbitrary arrest and detention is common; even foreigners are
not exempt. Police often beat criminal suspects, and detention
can be prolonged. Prison conditions are poor. Although the
Government says that it investigates abuses, those responsible
for documented abuses rarely are punished. The judiciary does
not always ensure due process and takes its direction from the
executive branch.
The Government severely limits freedom of speech and the
press, and freedom of expression is constrained by an
atmosphere of repression that makes it difficult to criticize
the Government publicly. Although the Constitution expressly
prohibits it, press censorship continues. The Government
sharply restricts the importation of foreign print media. The
Government limits freedom of assembly and association. The
Government continues to ban unsanctioned public meetings and
demonstrations. To control the political arena, the Government
continues to deny registration to independent political parties
and other groups potentially critical of the Government, and
prevents unregistered opposition parties and movements from
operating freely or publishing their views. The Government
continued to decline to approve the registration application of
the Human Rights Society of Uzbekistan, which has been seeking
to register since 1992, citing technical deficiencies in its
paperwork. The Government limits freedom of religion; it has
harassed and arrested independent Islamic leaders on
questionable grounds, citing the threat of Islamic extremism.
It has also arrested and allegedly threatened evangelical
leaders, and denied registration to Christian sects it does not
accept. Despite a constitutional prohibition, there continues
to be significant traditional societal discrimination and
domestic violence against women.
The pace of reform slowed during the year. Nevertheless,
several potentially positive steps were taken. In April the
Oliy Majlis passed legislation establishing an ombudsman's
office. However, by year's end, the office had not yet
demonstrated whether it could function in accordance with its
legislative mandate and play an important role in monitoring
human rights abuses. The Oliy Majlis also enacted legislation
reforming the penal system and protecting the rights of
prisoners. In April new laws providing increased access to
information and protection of journalists were passed, and a
mass media law passed in December, although the effects on
press freedom remained unclear at year's end.
conclusion
The states in the South Caucasus and Central Asia are
falling behind in economic and democratic reforms and in their
respect for human rights. The choice for the United States is
either to remain passive, with a parochial and largely
ineffective aid program, or to re-engage with these countries
to advance an agenda of real economic and democratic gains we
support. Failure to engage will likely result in a downward
spiral of economic hardship and a deterioration of human rights
for populations in the region, followed most likely by the full
collapse of state structures and an ensuing loss of
sovereignty. Once state structures collapse, the choice for
populations in the region will be either anarchy or
incorporation with Russia or Iran, circumstances that offer no
hope for improved human rights, democratic opportunities or
economic prosperity.
Absent a renewed effort by the United States Government,
prospects for economic and democratic reforms in the region are
bleak. Currently, in many of these countries, major investment
in the oil and gas sectors by U.S. companies is the single
greatest form of engagement with the United States. This will
remain the case, regardless of how undemocratic or corrupt
governments in the region become. The Silk Road Strategy Act is
necessary to ensure that natural resource development will not
be the only form of engagement. While United States economic
assistance is not a requirement for economic or democratic
reforms to be undertaken in the South Caucasus and Central
Asia, targeted U.S. assistance would address areas--such as
democratic governance and human rights--that simply are not a
priority for foreign investors. For better or for worse,
without the flexibilities included in the Silk Road Strategy
Act, the dominant and even exclusive source of U.S. engagement
in countries such as Azerbaijan will remain oil and gas
interests.
If broader engagement is the choice for the United States,
as outlined by the Silk Road Strategy Act, time is of the
essence. Restive populations, increasing misery, and
exploitation by hostile powers must be addressed through a
comprehensive regional strategy. U.S. economic assistance and
diplomacy must be brought to bear to resolve regional
conflicts, to open blocked borders, to build regional economic
cooperation, to advance human rights, and to promote the
establishment of democratic governments. It is not
inconceivable that, in failing to act, the United States would
miss an opportunity to secure the independence of states that,
in the worst circumstance, could prove to be the building
blocks of a hostile, regional empire reproducing the threat and
tensions of the Cold War. The Silk Road Strategy Act is an
active step toward a much brighter alternative in the region.
II. Committee Action
The Silk Road Strategy Act of 1998 was introduced by
Senator Sam Brownback, Senator Gordon Smith, and seven
cosponsors on October 30, 1997. On June 23, 1998, the Committee
on Foreign Relations debated and ordered reported an amendment
in the nature of a substitute to the bill by a voice vote.
Prior to final passage of S. 1344, the following action was
taken:
Brownback amendment in the nature of a substitute
(including technical amendments and 4 Sarbanes
amendments) was unanimously agreed to.
2 Sarbanes amendments defeated by a vote of 8-10 (Yeas:
Biden, Sarbanes, Dodd, Kerry, Robb, Feingold,
Feinstein, and Wellstone; Nays: Helms, Lugar,
Coverdell, Hagel, Smith, Thomas, Grams, Ashcroft,
Frist, and Brownback).
Several hearings were held in the Committee on Foreign
Relations to assess United States policy in the South Caucasus
and Central Asia.
April 24, 1997
Full Committee hearing: Hearing on the Conventional Armed
Forces in Europe (CFE) Treaty, Revisions of the Flank
Agreement.
The Honorable Lynn Davis, Undersecretary of State for
Arms Control and International Security Affairs.
The Honorable Walter Slocombe, Undersecretary of Defense
for Policy.
General Gary M. Rubus, Deputy Director for International
Negotiations, Joint Chiefs of Staff.
Dr. Sherman Garnett, Senior Associate. Carnegie Endowment
for International Peace.
Dr. Paul Goble, Director, Communications Department,
Radio Free Liberty/Radio Liberty.
May 5, 1997
Subcommittee on European Affairs hearing: The Foreign
Assistance Program to the Former Soviet Union and Central
and Eastern Europe.
The Honorable Richard L. Morningstar, Coordinator, Office
of U.S. Assistance to the Newly Independent States.
Mr. James H. Holmes, Coordinator, Office of Eastern
European Assistance.
July 21, 1997
Subcommittee on European Affairs and Subcommittee on Near
Eastern and South Asian Affairs joint hearing: U.S. Foreign
Policy Interests in the South Caucasus and Central Asia.
The Honorable Stuart E. Eizenstat, Undersecretary of
State for Economic Affairs.
The Honorable Caspar Weinberger, Chief Executive Officer,
Forbes, Inc.
Lt. Gen. William E. Odom, USA (ret.), Director of
National Security Studies, Hudson Institute.
Mr. Paul Goble, Director, Communications Department,
Radio Free Europe/Radio Liberty.
Dr. Martha Brill Olcott, Senior Associate, Carnegie
Endowment for International Peace
October 22, 1997
Subcommittee on International Economic Policy, Export and Trade
Promotion hearing: U.S. Economic and Strategic Interests in
the Caspian Sea Region: Policies and Implications.
The Honorable Sam Brownback (R-KS), United States Senate.
The Honorable Stuart E. Eizenstat, Undersecretary of
State for Economic, Business and Agricultural Affairs.
The Honorable Lawrence S. Eagleburger, Senior Foreign
Policy Advisor, Baker, Donelson, Bearman and Caldwell.
Mr. Charles J. Pitman, Chairman and President, Amoco
Eurasia Petroleum Company.
February 24, 1998
Subcommittee on International Economic Policy, Export and Trade
Promotion hearing: Implementation of U.S. Policy on
Construction of a Western Caspian Sea Oil Pipeline.
The Honorable Robert W. Gee, Assistant Secretary of
Energy for Policy and International Affairs.
Mr. Jan Kalicki, Counselor to the Department of Commerce.
Mr. Lawrence R. Fisher, Vice President Production and
Pipelines, Fluor-Daniel Incorporated.
The Honorable Charles William Maynes, President, The
Eurasia Foundation.
June 16, 1998
Subcommittee on International Economic Policy, Export and Trade
Promotion hearing: Implementation of U.S. Policy on
Construction of a Western Caspian Pipeline
The Honorable Marc Grossman, Assistant Secretary of State
for European and Canadian Affairs.
The Honorable Stephen R. Sestanovich, Special Advisor the
Secretary of State for the New Independent States.
The Honorable Zbigniew Brzezinski, Counselor, Center for
Strategic and International Studies.
Dr. Martha Brill Olcott, Senior Associate, Carnegie
Endowment for International Peace.
Mr. Van Krikorian, Chairman, Board of Directors, Armenian
Assembly.
III. Section-by-Section Analysis
Section 1--Short Title
This Act may be cited as the Silk Road Strategy Act of 1998
Section 2--Findings
Section 3-- Policy of the United States
Section 3 establishes that it shall be the policy of the
United States in the South Caucasus and Central Asia to promote
and strengthen independence, sovereignty, democratic
government, and respect for human rights; to promote tolerance,
pluralism, and understanding and counter racism and anti-
Semitism; to assist actively in the resolution of regional
conflicts and to facilitate the removal of impediments to
cross-border commerce; to promote friendly relations and
economic cooperation; to help promote market-oriented
principles and practices; to assist in the development of
infrastructure necessary for communications, transportation,
education, health, and energy and trade on an East-West axis in
order to build strong international relations and commerce
between those countries and the stable, democratic and market
oriented countries of the Euro-Atlantic Community; and, to
support United States business interests and investments in the
region.
Section 4 U.S. Efforts to Resolve Regional Conflicts in the South
Caucasus and Central Asia
Sense of the Congress that the President should use all
diplomatic means practicable, including the engagement of
senior United States Government officials, to press for an
equitable, fair and permanent resolution to the conflicts in
the South Caucasus and Central Asia.
Section 5--Amendment of the Foreign Assistance Act of 1961
The Silk Road Strategy Act of 1998 authorizes the provision
of assistance to countries in the South Caucasus and Central
Asia to promote reconciliation and recovery from regional
conflicts; to foster economic growth and development, including
the conditions necessary for regional economic cooperation; to
secure borders and implement effective controls necessary to
prevent the trafficking of illegal narcotics and the
proliferation of technology and materials related to weapons of
mass destruction; and to promote institutions of democratic
government and create the conditions for the growth of
pluralistic societies, including religious tolerance and
respect for internationally recognized human rights.
The Silk Road Strategy Act restricts assistance to
countries in the South Caucasus and Central Asia on the exact
same eligibility requirements that are otherwise currently
applied to those countries under Foreign Assistance Act of
1961. Specifically, except as provided in the waiver contained
in this section (also identical to that contained in the
Foreign Assistance Act of 1961), assistance may not be provided
under this chapter for the government of a country of the South
Caucasus or Central Asia if the President determines and
certifies to the appropriate congressional committees that the
government of such country:
(1) is engaged in a consistent pattern of gross
violations of internationally recognized human rights;
(2) has, on or after the date of enactment of this
chapter, knowingly transferred to another country--
(A) missiles or missile technology
inconsistent with the guidelines and parameters
of the Missile Technology Control Regime; or
(B) any material, equipment, or technology
that would contribute significantly to the
ability of such country to manufacture any
weapon of mass destruction(including nuclear,
chemical and biological weapons) if the
President determines that the material,
equipment, or technology was to be used by such
country in the manufacture of such weapons;
(3) has repeatedly provided support for acts of
international terrorism; or
(4) is prohibited from receiving such assistance by
chapter 10 of the Arms Export Control Act or section
306(a)(1) and 307 of the Chemical Biological Weapons
Control and Warfare Elimination Act of 1991
Section 6--Annual Report
The annual reporting requirements under section 104 of the
Freedom Support Act are revised to include specific analysis on
progress toward implementing the policies of the Silk Road
Strategy Act of 1998.
Section 7--Conforming Amendments
Conforming amendment to the Freedom Support Act (PL-102-
511).
IV. Cost Estimate
In accordance with rule XXVI, paragraph 11(a) of the
Standing Rules of the Senate, the Committee provides the
following estimates of the cost of this legislation prepared by
the Congressional Budget Office.
U.S. Congress,
Congressional Budget Office,
Washington, DC, July 13, 1998.
Hon. Jesse Helms,
Chairman, Committee on Foreign Relations,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office (CBO) has
prepared the enclosed cost estimate for S. 1344, the Silk Road
Strategy Act of 1998.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Joseph C.
Whitehill, who can be reached at 226-2840.
Sincerely,
June E. O'Neill,
Director.
Enclosure
cc: Hon. Joseph R. Biden, Jr.,
Ranking Minority Member.
----------
Congressional Budget Office Cost Estimate
July 13, 1998
S.1344
SILK ROAD STRATEGY ACT OF 1998
As ordered reported by the Senate Committee on Foreign Relations on
June 23, 1998
S. 1344 would state U.S. policy on various economic and
political matters related to countries of the South Caucasus
and Central Asia. Although the bill would authorize several
broad categories of assistance to the region, it would not
authorize specific amounts, and the authorizations would
overlap with more general authorizations in current law.
Because the bill would not substantially expand the
Administration's authority to provide assistance, either
geographically or programmatically, CBO estimates that spending
targeted at the region would continue at the current rate--
approximately $460 million in economic assistance, security
assistance, food aid, and export financing. That spending would
be subject to appropriation.
S. 1344 would not affect direct spending or receipts; thus
pay-as-you-go procedures would not apply. The bill contains no
intergovernmental or private-sector mandates as defined in the
unfunded Mandates Reform Act, and would not affect the budgets
of state, local, or tribal governments.
The estimate was prepared by Joseph C Whitehill, who can be
reached at 226-2840. This estimate was approved by Paul N. Van
de Water, Assistant Director for Budget Analysis.
V. Evaluation of Regulatory Impact
In accordance with Rule XXVI, paragraph 11(b) of the
Standing Rules of the Senate, the Committee has concluded that
there is no regulatory impact from this legislation.
VI. Changes in Existing Law
In compliance with paragraph 12 of Rule XXVI of the
Standing Rules of the Senate, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
Foreign Assistance Act of 1961
* * * * * * *
CHAPTER 11--SUPPORT FOR THE ECONOMIC AND DEMOCRATIC DEVELOPMENT OF THE
INDEPENDENT STATES OF THE FORMER SOVIET UNION
* * * * * * *
CHAPTER 12--SUPPORT FOR THE ECONOMIC AND POLITICAL INDEPENDENCE OF THE
COUNTRIES OF THE SOUTH CAUCASUS AND CENTRAL ASIA
SEC. 499. UNITED STATES ASSISTANCE TO PROMOTE RECONCILIATION AND
RECOVERY FROM REGIONAL CONFLICTS.
(a) Purpose of Assistance.--The purposes of assistance
under this section include--
(1) the creation of the basis for reconciliation
between belligerents;
(2) the promotion of economic development in areas
of the countries of the South Caucasus and Central Asia
impacted by civil conflict and war; and
(3) the encouragement of broad regional cooperation
among countries of the South Caucasus and Central Asia
that have been destabilized by internal conflicts.
(b) Authorization for Assistance.--
(1) In general.--To carry out the purposes of
subsection (a), the President is authorized to provide
humanitarian assistance and economic reconstruction
assistance for the countries of the South Caucasus and
Central Asia to support the activities described in
subsection (c).
(2) Definition of humanitarian assistance.--In this
subsection, the term `humanitarian assistance' means
assistance to meet humanitarian needs, including needs
for food, medicine, medical supplies and equipment, and
clothing.
(c) Activities Supported.--Activities that may be supported
by assistance under subsection (b) include--
(1) providing for the humanitarian needs of victims
of the conflicts;
(2) facilitating the return of refugees and
internally displaced persons to their homes; and
(3) assisting in the reconstruction of residential
and economic infrastructure destroyed by war.
(d) Policy.--It is the sense of Congress that the United
States should, where appropriate, support the establishment of
neutral, multinational peacekeeping forces to implement peace
agreements reached between belligerents in the countries of the
South Caucasus and Central Asia.
SEC. 499A. ECONOMIC ASSISTANCE.
(a) Purpose of Assistance.--The purpose of assistance under
this section is to foster economic growth and development,
including the conditions necessary for regional economic
cooperation, in the South Caucasus and Central Asia.
(b) Authorization for Assistance.--To carry out the purpose
of subsection (a), the President is authorized to provide
assistance for the countries of the South Caucasus and Central
Asia to support the activities described in subsection (c).
(c) Activities Supported.--In addition to the activities
described in section 498, activities supported by assistance
under subsection (b) should support the development of the
structures and means necessary for the growth of private sector
economies based upon market principles.
(d) Policy.--It is the sense of Congress that the United
States should--
(1) assist the countries of the South Caucasus and
Central Asia to develop policies, laws, and regulations
that would facilitate the ability of those countries to
join the World Trade Organization to enjoy all the
benefits of membership; and
(2) consider the establishment of zero-to-zero
tariffs between the United States and the countries of
the South Caucasus and Central Asia.
SEC. 499B. DEVELOPMENT OF INFRASTRUCTURE.
(a) Purpose of Programs.--The purposes of programs under
this section include--
(1) to develop the physical infrastructure
necessary for regional cooperation among the countries
of the South Caucasus and Central Asia; and
(2) to encourage closer economic relations and to
facilitate the removal of impediments to cross-border
commerce among those countries and the United States
and other developed nations.
(b) Authorization for Programs.--To carry out the purposes
of subsection (a), the following types of programs for the
countries of the South Caucasus and Central Asia may be used to
support the activities described in subsection (c):
(1) Activities by the Export-Import Bank to
complete the review process for eligibility for
financing under the Export-Import Bank Act of 1945.
(2) The provision of insurance, reinsurance,
financing, or other assistance by the Overseas Private
Investment Corporation.
(3) Assistance under section 661 of this Act
(relating to the Trade and Development Agency).
(c) Activities Supported.--Activities that may be supported
by programs under subsection (b) include promoting actively the
participation of United States companies and investors in the
planning, financing, and construction of infrastructure for
communications, transportation, including air transportation,
and energy and trade including highways, railroads, port
facilities, shipping, banking, insurance, telecommunications
networks, and gas and oil pipelines.
(d) Policy.--It is the sense of Congress that the United
States representatives at the International Bank for
Reconstruction and Development, the International Finance
Corporation, and the European Bank for Reconstruction and
Development should encourage lending to the countries of the
South Caucasus and Central Asia to assist the development of
the physical infrastructure necessary for regional economic
cooperation.
SEC. 499C. BORDER CONTROL ASSISTANCE.
(a) Purpose of Assistance.--The purpose of assistance under
this section includes the assistance of the countries of the
South Caucasus and Central Asia to secure their borders and
implement effective controls necessary to prevent the
trafficking of illegal narcotics and the proliferation of
technology and materials related to weapons of mass destruction
(as defined in section 2332a(c)(2) of title 18, United States
Code), and to contain and inhibit transnational organized
criminal activities.
(b) Authorization for Assistance.--To carry out the purpose
of subsection (a), the President is authorized to provide
assistance to the countries of the South Caucasus and Central
Asia to support the activities described in subsection (c).
(c) Activities Supported.--Activities that may be supported
by assistance under subsection (b) include assisting those
countries of the South Caucasus and Central Asia in developing
capabilities to maintain national border guards, coast guard,
and customs controls.
(d) Policy.--It is the sense of Congress that the United
States should encourage and assist the development of regional
military cooperation among the countries of the South Caucasus
and Central Asia through programs such as the Central Asian
Battalion and the Partnership for Peace of the North Atlantic
Treaty Organization.
SEC. 499D. STRENGTHENING DEMOCRACY, TOLERANCE, AND THE DEVELOPMENT OF
CIVIL SOCIETY.
(a) Purpose of Assistance.--The purpose of assistance under
this section is to promote institutions of democratic
government and to create the conditions for the growth of
pluralistic societies, including religious tolerance and
respect for internationally recognized human rights.
(b) Authorization for Assistance.--To carry out the purpose
of subsection (a), the President is authorized to provide the
following types of assistance to the countries of the South
Caucasus and Central Asia:
(1) Assistance for democracy building.
(2) Assistance for the development of
nongovernmental organizations.
(3) Assistance for development of independent
media.
(4) Assistance for the development of the rule of
law.
(5) International exchanges and advanced
professional training programs in skill areas central
to the development of civil society.
(6) Assistance to promote increased adherence to
civil and political rights under section 116(e) of this
Act.
(c) Activities Supported.--Activities that may be supported
by assistance under subsection (b) include activities that are
designed to advance progress toward the development of
democracy.
(d) Policy.--It is the sense of Congress that the Voice of
America and RFE/RL, Incorporated, should maintain high quality
broadcasting for the maximum duration possible in the native
languages of the countries of the South Caucasus and Central
Asia.
SEC. 499E. INELIGIBILITY FOR ASSISTANCE.
(a) In General.--Except as provided in subsection (b),
assistance may not be provided under this chapter for the
government of a country of the South Caucasus or Central Asia
if the President determines and certifies to the appropriate
congressional committees that the government of such country--
(1) is engaged in a consistent pattern of gross
violations of internationally recognized human rights;
(2) has, on or after the date of enactment of this
chapter, knowingly transferred to another country--
(A) missiles or missile technology
inconsistent with the guidelines and parameters
of the Missile Technology Control Regime (as
defined in section 11B(c) of the Export
Administration Act of 1979 950 U.S.C. App.
2410b(c); or
(B) any material, equipment, or technology
that would contribute significantly to the
ability of such country to manufacture any
weapon of mass destruction (including nuclear,
chemical, and biological weapons) if the
President determines that the material,
equipment, or technology was to be used by such
country in the manufacture of such weapons;
(3) has repeatedly provided support for acts of
international terrorism; or
(4) is prohibited from receiving such assistance by
chapter 10 of the Arms Export Control Act or section
306(a)(1) and 307 of the Chemical and Biological
Weapons Control and Warfare Elimination Act of 1991 (22
U.S.C. 5604(a)(1), 5605).
(b) Exceptions to Ineligibility.--
(1) Exceptions.--Assistance prohibited by
subsection (a) or any similar provision of law, other
than assistance prohibited by the provisions referred
to in paragraphs (2) and (4) of subsection (a), may be
furnished under any of the following circumstances:
(A) The President determines that
furnishing such assistance is important to the
national interest of the United States.
(B) The President determines that
furnishing such assistance will foster respect
for internationally recognized human rights and
the rule of law or the development of
institutions of democratic governance.
(C) The assistance is furnished for the
alleviation of suffering resulting from a
natural or man-made disaster.
(D) The assistance is provided under the
secondary school exchange program administered
by the United States Information Agency.
(2) Report to congress.--The President shall
immediately report to Congress any determination under
paragraph (1) (A) or (B) or any decision to provide
assistance under paragraph (1)(C).
SEC. 499F. ADMINISTRATIVE AUTHORITIES.
(a) Assistance Through Governments and Nongovernmental
Organizations.--Assistance under this chapter may be provided
to governments or through nongovernmental organizations.
(b) Use of Economic Support Funds.--Except as otherwise
provided, any funds that have been allocated under chapter 4 of
part II for assistance for the independent states of the former
Soviet Union may be used in accordance with the provisions of
this chapter.
(c) Terms and Conditions.--Assistance under this chapter
shall be provided on such terms and conditions as the President
may determine.
(d) Relationship to Other Laws.--
(1) Superseding existing law.--The authorities
contained in this chapter and in chapter 11 to provide
assistance for the countries of the South Caucasus and
Central Asia shall supersede the FREEDOM Support Act
(22 U.S.C. 5801 et seq.).
(2) Available authorities.--The authority in this
chapter to provide assistance for the countries of the
South Caucasus and Central Asia is in addition to the
authority to provide such assistance under the FREEDOM
Support Act (22 U.S.C. 5801 et seq.) or any other Act,
and the authorities applicable to the provision of
assistance under chapter 11 may be used to provide
assistance under this chapter.
SEC. 499G. DEFINITIONS.
In this chapter:
(1) Appropriate congressional committees.--The term
`appropriate congressional committees' means the
Committee on Foreign Relations of the Senate and the
Committee on International Relations of the House of
Representatives.
(2) Countries of the south caucasus and central
asia.--The term `countries of the South Caucasus and
Central Asia' means Armenia, Azerbaijan, Georgia,
Kazakstan, Kyrgyzstan, Tajikistan, Turkmenistan, and
Uzbekistan.
Freedom for Russia and Emerging Eurasian Democracies and Open Markets
Support Act of 1992
FREEDOM Support Act
* * * * * * *
TITLE I--GENERAL PROVISIONS
* * * * * * *
SEC. 102. PROGRAM COORDINATION, IMPLEMENTATION, AND OVERSIGHT.
(a) Coordination.--The President shall designate, within
the Department of State, a coordinator who shall be responsible
for--
(1) * * *
(2) ensuring program and policy coordination among
agencies of the United States Government in carrying
out the policies set forth in [this Act] this Act and
the Silk Road Strategy Act of 1998 (including the
amendments made by [this Act] this Act and the Silk
Road Strategy Act of 1998);
(3) * * *
(4) ensuring that United States assistance programs
for the independent states are consistent with [this
Act] this Act and the Silk Road Strategy Act of 1998
(including the amendments made by [this Act] this Act
and the Silk Road Strategy Act of 1998);
(5) * * *
* * * * * * *
SEC. 104. ANNUAL REPORT.
* * * * * * *
(3) an assessment of the effectiveness of United
States assistance in achieving its purposes; [and]
(4)an evaluation of the manner in which the
``notwithstanding'' authority provided in section
498B(j)(1) of the Foreign Assistance Act of 1961, and
the ``notwithstanding'' authority provided in any other
provision of law with respect to assistance for the
independent states, has been used and why the use of
that authority was necessary[.]; and
(5) with respect to the countries of the South
Caucasus and Central Asia--
(A) identifying the progress of United
States foreign policy to accomplish the policy
identified in section 3 of the Silk Road
Strategy Act of 1998;
(B) evaluating the degree to which the
assistance authorized by chapter 12 of part I
of the Foreign Assistance Act of 1961 has been
able to accomplish the purposes identified in
those sections; and
(C) recommending any additional initiatives
that should be undertaken by the United States
to implement the policy and purposes contained
in the Silk Road Strategy Act of 1998.
* * * * * * *
VII. MINORITY VIEWS OF SENATORS SARBANES, KERRY, ROBB, FEINGOLD,
FEINSTEIN, AND WELLSTONE
Through the Freedom Support Act, the United States over the
past six years has encouraged the transition to democracy and
free markets in the New Independent States of the former Soviet
Union (NIS). In providing assistance under the Act, the
President must take into account the extent to which each
government is committed to, and making progress toward, such
goals as the establishment of a democratic political system and
a market-based economy, respect for internationally recognized
human rights, adherence to international law and obligations,
cooperation in seeking peaceful resolution of ethnic and
regional conflicts, implementation of responsible security and
non-proliferation policies, and protection of the international
environment. All the countries of the South Caucasus and
Central Asia currently receive U.S. aid under this program,
amounting to nearly $300 million in FY 1998. In addition, most
of the countries receive assistance through the Partnership for
Peace program, the Peace Corps, the Trade and Development
Agency, and multicountry enterprise funds.
The ``Silk Road Strategy Act'' (S. 1344) repudiates the
fundamental principles of the Freedom Support Act. It exempts
eight of the thirteen former Soviet republics from the
requirements of the Freedom Support Act while authorizing new
forms of aid for them, thus creating two classes of states:
those who must comply with the law, and those who are outside
it. By providing aid to certain NIS countries without requiring
progress toward the goals of the Freedom Support Act, S. 1344
will undermine the long-term goals and abiding principles of
U.S. foreign policy.
As reported by the Senate Foreign Relations Committee, S.
1344 would have several unfortunate consequences.
First, it would reward the Government of Azerbaijan with
expanded assistance despite that Government's dismal human
rights record, its lack of progress toward democracy, and its
continuing economic blockade against Armenia and Nagorno-
Karabakh. According to the State Department's most recent
Country Report on Human Rights Practices for Azerbaijan,
The Government's human rights record continued to be
poor, and the Government continued to commit serious
abuses. Police beat persons in custody, and some
beatings resulted in deaths. Police also arbitrarily
arrested and detained persons; conducted searches and
seizures without warrants; and suppressed and refused
to allow peaceful public demonstrations. In most
instances, the Government took no action to punish
abusers. In a variety of separate incidents, the
Government arrested at least 19 members of the
opposition Azerbaijan Popular Front Party. Prison
conditions remained harsh. The entire judiciary is
corrupt, inefficient, and subject to executive
influence.
The current political situation in Azerbaijan makes the
timing of this measure particularly inopportune. After the
overthrow of Azerbaijan's democratically-elected president in
1993, former Soviet Politburo member Heidar Aliyev assumed
power and proceeded to restrict the independence of the
legislature and judiciary. There were severe shortcomings in
the conduct of parliamentary elections in 1995, and power
became increasingly concentrated in the hands of an
authoritarian ruler. With the adoption of a seriously flawed
election law, the pattern appears to be repeating itself in the
Presidential elections that are planned for October of this
year. To expand the Government's eligibility for assistance at
this juncture would serve to legitimize and strengthen an
undemocratic regime at the very time U.S. pressure is needed to
ensure that elections are conducted in a free and fair manner.
In its foreign policy, the Government of Azerbaijan has
similarly thwarted U.S. attempts to promote peaceful conflict
resolution and regional economic integration. For the past nine
years, the government of Azerbaijan has prevented the transport
of food, fuel, medicine, and other vital commodities to Armenia
and Nagorno-Karabakh, causing immense human suffering. Most
Armenian industries have been forced to close down, crippling
the economy and producing widespread unemployment and poverty.
The blockade has been particularly devastating because it is
also enforced by Turkey, and because of the civil conflict that
makes transport through Georgia difficult. Since Armenia is
entirely landlocked, this leaves Iran as Armenia's only
possible outlet--the very outcome that S. 1344 is purported to
discourage.
Under section 907 of the Freedom Support Act, which S. 1344
would abrogate, United States assistance may not be provided to
the Government of Azerbaijan until the President determines,
and so reports to the Congress, that the Government of
Azerbaijan is taking demonstrable steps to cease all blockades
and other offensive uses of force against Armenia and Nagorno-
Karabakh. Section 907 does not apply to humanitarian assistance
for refugees, displaced persons and needy civilians affected by
the conflicts in the Southern Caucasus. It does not apply to
aid that is channeled through non-governmental organizations.
Nor does it apply to programs that support democracy,
nonproliferation and disarmament, border security, or to
activities of the Trade and Development Agency and the Foreign
Commercial Service. Because of the many exceptions to section
907, Azerbaijan has received a total of $80 million in U.S. aid
since 1994.
We wish to emphasize that eligibility for United States
foreign assistance is not an entitlement. The placing of
conditions upon foreign aid is both reasonable and appropriate,
for policy as well as budgetary reasons, and should not be
considered an economic ``sanction''. In order to lift section
907, all Azerbaijan must do is to ``take demonstrable steps to
cease all blockades against Armenia and Nagorno-Karabakh.''
This is an entirely reasonable expectation, especially given
the basic purpose of S. 1344, which is to promote trade and
economic cooperation between the countries of the region. To
nullify the requirements of section 907 in the absence of any
progress toward a resolution of the Nagorno-Karabakh issue
would thus constitute an undeserved subsidy for the Government
of Azerbaijan and remove a major incentive for good-faith
negotiation from one side in the conflict.
Second, we are concerned by what we perceive as the bill's
excessive focus on oil and gas interests. While the U.S. has a
strategic interest in maintaining adequate supplies of energy
at reasonable prices from diverse sources, pipeline politics
should not be permitted to overshadow some of the larger issues
and concerns of U.S. policy. The United States has a
fundamental interest in promoting basic American values and
principles, such as respect for human rights, democracy and the
rule of law. In their absence, the long-term goals of peace and
stability, security and prosperity are often unattainable or
meaningless.
These values and principles must serve as a starting point
for U.S. policy in the South Caucasus and Central Asia. Yet S.
1344 would take the reverse approach. By increasing the
availability of U.S. assistance for countries that have failed
to demonstrate a commitment to democratic principles, the bill
sends the message that economic interests will dominate U.S.
policy decisions. It was precisely this orientation that led
Human Rights Watch to assert in its 1998 report, ``The
international community largely glossed over Azerbaijan's poor
human rights record in order to protect oil interests.''
Not only does the bill provide assistance to eight
governments regardless of their compliance with the Freedom
Support Act, but it also provides a waiver of other U.S. laws
designed to promote cooperation on human rights,
counterterrorism, and nonproliferation of weapons of mass
destruction. The new section 499E, which the bill would add to
the Foreign Assistance Act of 1961, allows the President to
furnish assistance notwithstanding any other provision of law,
if he determines that it is important to the national interest,
or that it will foster respect for internationally recognized
human rights and the rule of law or the development of
institutions of democratic governance.
While most current restrictions on assistance contain a
national interest waiver, the standard contained in this bill
is weaker in several instances. For example, the prohibitions
in current law on assistance to governments supporting
international terrorism can be waived only for national
security interests or humanitarian reasons. The ban on
assistance to any unit of the security forces of a foreign
country if the Secretary of State has credible evidence that
such unit has committed gross violations of human rights, may
only be waived if the government of such country is taking
effective measures to bring the responsible parties to justice.
We believe the countries of the Caspian Sea basin should be
held to the same standards of conduct in the areas of human
rights, proliferation of weapons of mass destruction, and
terrorism, as every other country that receives foreign
assistance.
U.S. willingness to overlook egregious deficiencies in the
political and economic systems of countries in the Caspian Sea
basin may also have a negative effect on our relations with
Russia, China, and other countries for which the transition to
democracy and free markets is at issue. As Librarian of
Congress James H. Billington noted in a recent article,
Russians recognize that they have not created the
best conditions for foreign investment. But they feel
humiliated that China is now getting more than 10 times
as much American investment as their own struggling
democracy. They are further aggravated by the spectacle
of former high American officials falling all over one
another to promote oil development in authoritarian
Azerbaijan and Kazakstan rather than the even greater
energy resources in Russia.
There is ample cause for concern that enactment of S. 1344 will
actually result in less funding being available for Russia,
which has made greater advances toward the rule of law and
economic reform than any of the beneficiaries of this
legislation.
Finally, we are concerned that removing U.S. assistance to
this region from the context of the Freedom Support Act is
based on the misconception that stability will flow from oil
wealth. Providing balance of payments support to governments
that have not established appropriate oversight mechanisms, and
encouraging U.S. investment in countries that have not
established a favorable legal climate, is unlikely to produce
democratic institutions committed to economic reform and social
justice. As the Washington Post argued in a recent editorial
about Azerbaijan's lack of democracy, ``Oil wealth without
governmental accountability is likely to lead to massive
corruption and an embittered and impoverished population--not
circumstances likely to further America's strategic goals in
the region.''
For these reasons, we believe this legislation represents
an ill-advised attempt to shift U.S. policy away from the more
balanced approach reflected in the Freedom Support Act, with
potentially serious negative consequences. While constructive
changes were made to the bill during mark-up, these
modifications were insufficient to change its overall effect,
and we regret that a number of proposed corrections which would
have rectified the bill's most obvious deficiencies were
rejected.