Tagged: FightagainstFraud

Speeches: Combatting Terrorism: Looking Over the Horizon

Thank you, Ruth. It is great to be here at SAIS – a place that has always emphasized an interdisciplinary approach to international affairs and a place well suited for this discussion about the need to address underlying causes of violent extremism in order to support current efforts to defeat terrorist networks.

From Copenhagen to Cairo, from Paris to Peshawar, in Nigeria, Libya, and China, violent extremists have perpetrated bombings, kidnappings, and shootings this year. Violent extremism is spreading geographically and numerically, and every corner of the globe is at risk. No country or community is immune. Intelligence officials argue that terrorism trend lines are worse than at any other time in modern history; despite the tactical successes of our intelligence gathering, military force, and law enforcement efforts, terror networks are spreading and new threats are emerging around the world. Accordingly, the United States and its allies in the fight against terrorism must strengthen our comprehensive strategy to address the underlying drivers that fuel the appeal and spread of violent extremism. That is precisely why President Obama recently hosted the White House Summit to Counter Violent Extremism. Joining with leaders of foreign governments, international organizations, the private sector and civil society, President Obama and Secretary Kerry launched a global effort to address the enablers of violent extremism in order to prevent the emergence of new terror threats.

It is worth putting this pivotal moment in historical context.

As we look back on the terrorist challenge of past decades, several broad phases are discernible. We saw terrorism in the 1970s, 80s, and even 90s largely in the context of political movements, nationalists and separatists, regarding terror as a tactic used most often for political gains. Our national and international organizations dedicated to addressing these movements were modest, and our response paired political, criminal justice and law enforcement efforts.

In the 1990s, however, terror attacks against U.S. targets at home against the World Trade Center and abroad against the U.S. Embassies started to shift our thinking about and approach toward terrorism. It was no longer seen only as a foreign political challenge. Of course, after the 9/11 attacks against the United States, the U.S. mobilized anew, developing extraordinary military and intelligence capabilities focused on better understanding, tracking, and where necessary, attacking terrorists and terror networks. Working closely with a small number of partners, we also developed intelligence networks and refined military operations to detect terrorists and foil their plots, and we enhanced border security, law enforcement, and other tools to protect the homeland. With the killing of Osama Bin Laden in 2011 and of countless other terror leaders, al-Qa’ida’s core was beaten back.

Yet despite the world’s devotion of enormous military and intelligence resources – as well as human treasure – the threat of violent extremism persists. Over the past 13 years, violent extremist movements have diffused and proliferated. Increasingly, they have sprung from within conflicts worldwide. And they have exploited grievances and divided societies in order to further their own aims. Weak, illegitimate, and repressive governments inadvertently created opportunities for terrorists to capitalize on popular resentment of governments make common cause with local insurgents, the discontented, and criminal networks, and operate in poorly governed territory. Additionally, terrorist methods and goals have diversified. They now control large territories in several regions of the world.

Let me offer specific illustrations of these dynamics: Tehrik-e-Taliban has long exploited local grievances in the tribal belt along the Afghanistan-Pakistan border in order to sustain itself. Members of Al-Qa’ida’s network in East Africa blended with militants from the Council of Islamic Courts to create al-Shabaab. In the loosely governed expanses of the Sahel, extremists including AQIM associated with disenfranchised Tuareg tribes to expand its power base. In Libya, Ansar al-Sharia exploited post-Gaddafi factional violence to cement itself in the Libyan landscape. And the Islamic State of Iraq and the Levant, or Daesh today, dramatically expanded its reach and power by capitalizing on Sunni political disenfranchisement in Iraq. The rise of Daesh is on all of our minds, but it is only one manifestation of a trend that we have witnessed over the last decade. Violent extremist groups have been expanding their control and resonance in South Asia, the Sahel, the Maghreb, Nigeria, Somalia, and in the Arabian Peninsula.

Of course, the U.S. approach and that of our partners in the fight against violent extremism has been adapting as well. We continued to pursue military force to go after terrorist leaders plotting to attack the U.S. or its interests and continued to refine our intelligence capabilities. We proved adept at taking key terrorists off of the battlefield. We also adopted more comprehensive approaches toward terrorism and violent extremism, adapting to the evolving threats we faced. For example, we placed greater emphasis on building the capacity – including military, intelligence, and civilian – of our partners to address threats within their own borders and region, as well as expanding efforts to reduce the radicalization that was leading individuals to join terrorist groups. We strengthened the international counterterrorism architecture by working with our Western allies and Muslim-majority partners to launch the Global Counterterrorism Forum in 2011. This platform allows experts from around the world to share good practices and devise innovative civilian-focused approaches to addressing the terrorist and violent extremist threats freed from the politics and process of traditional multilateral bodies. That same year, the U.S. inter-agency Center for Strategic Counterterrorism Communication was created to more effectively counter the violent extremist narrative. And the U.S. sought to place greater emphasis on the role of law enforcement and the wider criminal justice system in preventing terrorism and bringing terrorists to justice within a rule of law framework, thereby strengthening the international cooperation that is so essential to addressing the threat. More broadly, from his first day in office, President Obama has made clear that to be successful, all of our efforts to counter terrorism and root out the violent ideology that underpins it, must be done consistent with American values and be rooted in respect for human rights.

Still, the threat of violent extremism continues to metastasize in different dimensions. A new variant of terrorist threat is foremost on our minds today. Some of the most violent extremist groups, such as Daesh or Boko Haram, differ from Al Qaeda, because they are not similarly devoted to dogmatic treatise, militant hierarchy, or simply destroying existing state authority. Many of these new actors they seize land, resources, and population to consolidate geographic control and advance their apocalyptic visions. They violate human rights in the most egregious ways imaginable, exacerbate communal differences, and lure foreign fighters to incite violence around the world. These groups destabilize entire regions and inspire, if not actively plot, attacks on the US homeland and against our allies. They violate and undermine every aspect of the progressive norms and order that the international community painstakingly built from the ruins of World War II. They pose very real threats to U.S. interests and to international stability as they propagate and violently pursue their nihilistic goals.

The international community has responded accordingly. ISIL’s sudden and dramatic rise has animated a robust military coalition to defeat it, which the coalition will most certainly do. But physically dislodging terrorist safe havens requires a comprehensive and costly military effort, and removing violent extremists from the political landscape of failed states or failing communities is a long-term process. The most effective and useful way to address the metastasizing threat of violent extremism is to prevent its spread through less costly and destabilizing methods, to better enable the success of the our military efforts to defeat terrorism where it already has rooted. The long game lies in building an international coalition to prevent the rise of the next ISIL.

This requires a clear-eyed view of why these groups have been successful. It is not solely because of their extremist ideology, as important as it is to counteract the vitriolic incitement. These groups are more opportunistic and cynical. For example, Boko Haram exploits unrelated local grievances and decades of neglect of the Muslim north. Daesh, a successor to the former al-Qa’ida in Iraq, emerged from the inferno of Syria’s civil war and capitalized on Iraq’s political difficulties. Al Shabaab drew its strength from Somalia’s state failure, rampant corruption, and inter-clan rivalry for resources, and these conditions allow the group to continue governing rural parts of Somalia. As the group was militarily dislodged from city centers, it began seeking common cause with aggrieved minorities along Kenya’s coast, using attacks to stoke ethnic and religious tensions.

The adaptation of terror organizations highlights the need for us to continue adapting our approach to violent extremism. These realities demand thinking about violent extremism not simply in terms of individual radicalization but also in the context of dynamics that make entire communities vulnerable to radicalization, co-optation, or exploitation.

How can we most effectively do this? We know there are many forces that drive individuals to violence. Current research, including interviews with former violent extremists or rehabilitated terrorists consistently reveals that there is no single driver of violent extremism. Rather, there are a number of common ones including: boredom, intergenerational tensions, the search for greater meaning in life, perceived adventure, attempts to impress the local community, a desire for increased credibility, to belong or gain peer acceptance, and revenge.

Similarly, there is no one driver of community-wide radicalization. Participants in last month’s White House Summit to Counter Violent Extremism cited social rejection, political disenfranchisement, and economic exclusion as underlying conditions conducive to the spread of violent extremism. Yet the phenomenon of political, economic, and social marginalization as a driver of violent extremism is not new, nor is it synonymous with any one region, religious tradition, or culture. Marginalization is a strong “push factor” for many individuals and groups, and it creates a vulnerability to ideological and charismatic “pull factors.” Extremist narratives therefore become more intellectually and emotionally attractive to these marginalized communities.

Support for violent extremism does not take hold only under illiberal, authoritarian regimes; it festers anywhere liberty is denied. Even in societies with legal frameworks that guarantee respect for human rights, extremists have found resonance by exploiting real or perceived social and economic discrimination. While we may not know the precise reasons why the Charlie Hebdo attackers Saïd and Chérif Kouachi resorted to terrorism, we can see how violent extremists seek to exploit discontentment. In the low-income housing projects outside of Paris where the brothers grew up, the youth unemployment rate stands at more than 25 percent, and residents often complain of unresponsive law enforcement in the face of soaring crime and blatant hiring discrimination.

Although not the sole driver of violent extremism, marginalized and alienated groups provide “seams of vulnerability” for terrorists to exploit in their efforts to recruit and seek support. Simply put, people who think that they have nothing to lose and that playing by the rules of the system provides no avenue to opportunity or success become more susceptible to being drawn to violent radical actions to upend the status quo. We must therefore anticipate and monitor, if not ideally stitch up, these seams of vulnerability. This is the concept of preventing the rise of violent extremism before it becomes a terrorist threat. To execute this prevention strategy wisely, we need to refine how we think about policies and programming to enhance our understanding of what makes communities vulnerable to radicalization, co-optation, or exploitation by violent extremists, and we need a strategy to prioritize the allocation and alignment of resources to address first those seams most vulnerable to terrorist exploitation.

This preventive approach requires policymakers and experts to expand their focus beyond today’s dangerous threats. They must look to include communities that have not yet become terror safe havens or active conflict zones but that show susceptibility either to ideological radicalization or simply to making common cause with foreign terrorist organizations. Effective prevention requires us to work not in violent extremism “hot spots,” safe havens, or in active conflict but at the periphery – the places that terror networks will seek to penetrate as they expand their spheres of influence or as they are displaced from their current safe havens.

Prevention through addressing vulnerabilities on the periphery of terror networks broadens available interventions to include diplomatic, political, and economic tools. These approaches are possible in non-crisis environments, where bilateral cooperation is stable, development professionals have access to target populations, civil society organizations exist, youth can attend school, and adults devote their energies to economic activity, not fighting – all necessary conditions for development assistance and related interventions to take root and lead to improvements in governance and long-term economic growth.

A focus on broader interventions to address underlying factors on the periphery creates new opportunities for success in the struggle against violent extremism. Not every potential partner can participate in a military coalition, and many states are committed to international assistance programs that can be tailored to this particular challenge. A prevention approach further enlarges the coalition of effective interveners to include civil society and the private sector, who find it challenging to work in crisis zones. Civil society organizations, especially local voices, actors, and networks are essential, since they have intimate knowledge and authentic credibility to mediate disputes and misunderstandings, among communities or with state actors. Civil society organizations are especially well-suited to partner with women and youth, two groups critical for successful community resilience. For example, during last month’s White House Summit, a civil society leader from a West African country described the long, difficult process she undertook to earn the trust of a group of local imams in order to start a book club program to teach critical thinking and reasoning skills at several madrassas. Only a local actor could have won the imams’ trust, underscoring why one of non-state actors are so critical for prevention work.

The private sector can also play a role on the periphery. Building alliances with the private sector strengthens community resilience, by providing more economic opportunity to citizens and showcasing new innovation, growth, and connectivity. More private sector growth can offer another way to dampen the appeal of extremism and stabilize communities.

President Obama hosted the Summit to draw more attention to the importance of addressing the broad enablers of this extremism and to highlight the role of local communities and civil society in this effort. The President defined the Summit goal as “preventing [violent extremist] groups from radicalizing, recruiting or inspiring others to violence in the first place,” and he challenged the international community, to come up with a positive, affirmative antidote to the nihilism that terrorists peddle: “If we’re going to prevent people from being susceptible to the false promises of extremism,” he said, “then the international community has to offer something better.” The event may well prove to be a pivotal moment in the global struggle against violent extremism, opening the way to a more comprehensive, affirmative, and far-reaching effort to prevent the spread of terrorist networks.

The meeting convened an unprecedented diversity of stakeholders from more than 65 governments, civil society leaders from more than 50 countries, and two dozen private sector institutions, who engaged in an honest, straight-forward discussion about the broader enablers of violent extremism and its effects on their communities. “We know that poisonous ideologies do not emerge from thin air,” United Nations Security General Ban Ki-moon declared, as he pointed to “oppression, corruption, and injustice” as drivers of violent extremism. He cautioned that “all too often counterterrorism strategies lack basic elements of due process and respect for the rule of law.” Dr. Peter Neumann of the International Center for the Study of Radicalization cited evidence that social and political marginalization render people receptive to violent extremism. Jordan’s Minister of Foreign Affairs Nasser Judeh addressed the role of Islam and called for an interfaith unity. “Religious authorities representing all religions on the face of this earth,” he said, “must unite on a narrative that discredits extremist ideology, dispels its foundations, and preaches moderation and interfaith harmony.”

The delegates outlined an ambitious, affirmative action agenda to address violent extremism. Governments, civil society, the private sector, and multilateral bodies committed to take action, both collectively and independently, in eight broad areas:

  • Encouraging local research and information-sharing;
  • Expanding the role of civil society, especially the role women and youth;
  • Strengthening community-police and community-security force relations;
  • Promoting the counter-narrative and weakening the legitimacy of violent extremist messaging;
  • Employing educational approaches and amplifying mainstream religious voices to build resilience;
  • Preventing radicalization in prisons and rehabilitating and reintegrating violent extremists;
  • Identifying political and economic opportunities for communities vulnerable to radicalization and recruitment;
  • Providing development assistance and stabilization efforts.

Several delegations have already pledged commitments in support of this comprehensive agenda. The United Nations will convene a special event this year to bring faith leaders from around the world together to promote mutual understanding and reconciliation. Japan announced a $15.5 million contribution to build capacity in the Middle East and North Africa to counter terrorism and violent extremism, including by strengthening community resilience. The European Union will create a Round of Eminent Persons from Europe and the Islamic world to encourage intellectual exchanges and promote dialogue on the cost and ramification of terrorism in our societies and to launch additional programs on how to link education and countering violent extremism. Norway will significantly expand its support for education training programs targeting populations at risk of radicalization and contribute $600,000 to the Global Community Engagement and Resilience Fund, and the Republic of Korea will engage IT companies to develop new initiatives to counter violent extremism.

Several delegations pledged support for counter-messaging initiatives. With European Union support, Belgium is establishing the Syria Strategic Communications Advisory Team to develop a communications strategy to provide subtle counter-narratives. The African Union has pledged to work through the Network of African Journalists for Peace to launch a continent-wide, counter-violent extremism messaging campaign, and through its Against Violent Extremism Network, Google Ideas is challenging the terrorist narrative, by leveraging and trumpeting the testimonials of more than 500 rehabilitated former extremists from 40 countries.

In addition, many countries and organizations, including Albania, Algeria, the African Union, Australia, Denmark, Djibouti, Kazakhstan, Kenya, Norway, and the Organization for Security and Co-operation in Europe, are already planning to host follow-on regional or thematic summits in an effort to involve more countries, civil society organizations, and companies in this process.

The Summit’s commitment to preventing violent extremism widens the aperture on the problem and invites deployment of development and broader foreign assistance programs to those communities particularly vulnerable to radicalization to violence.

The United States’ is committed to this multilateral action agenda. The U.S. is already working through the Global Counterterrorism Forum to support community-oriented policing in South Asia, the Horn of Africa, the Sahel, and elsewhere; nurturing entrepreneurship and strengthening innovation in emerging markets through our Global Entrepreneurship Summits and the Global Innovation through Science and Technology program; and rallying our partners across a broad array of sectors—including heads of the entertainment and technology industries, philanthropists, and policy makers—to expand economic opportunities for vulnerable and marginalized communities. In addition to the $188 million in programs that the State Department and USAID are already dedicating to implementation, President Obama has requested nearly $400 million in additional resources in the 2016 budget for the State Department to support a wider range of counterterrorism partnerships, including programs to address violent extremism.

Stay tuned for progress on this effort. President Obama invited Summit participants to reconvene at a leaders’ summit on the margins of the United Nations General Assembly in September, when heads of governments, organizations, and corporations will announce the programs and policies they have undertaken to address the drivers of violent extremism and implement the action agenda. The Summit agenda ultimately promises to identify areas of greatest risk to violent extremism and help prioritize the deployment of resources and expertise to prevent terrorism from taking hold.

Several Summit participants called the meeting a milestone in the global effort against violent extremism and a turning point for the U.S. in moving toward a holistic approach that embraces Muslim and marginalized communities, as well as the role of civil society and the private sector. The challenge now is to build on this momentum so that it produces practical and tangible outcomes. It is an opportunity to supplement, expand, and innovate for the next generation. We can complement a counterterrorism strategy that has had success in addressing immediate threats with a more comprehensive approach to prevent the emergence of new threats. This preventive approach is affirmative: by employing a broad range of tools, including diplomatic, political, development, and communications levers, it seeks to empower individuals and their communities to resist extremism without the risk of further alienating them. This approach may also prove more sustainable in employing a wider array of actors and interventions to prevent terrorist threats from expanding or emerging in the first place.

Although preventing violent extremism entails harnessing a broader toolkit than intelligence gathering, military force, and law enforcement has built to date, it does not mean that development assistance or strategic communications will replace security interventions in countering terrorism. The United States government will continue to defend the American people and its interests abroad by targeting and eliminating current terrorist threats. The President’s commitment to comprehensively preventing violent extremism will advance new tools to complement and enhance, not replace, current counterterrorism efforts.

The White House Summit already has spurred new investments and innovative programs to address the underlying drivers of violent extremism. Yet realizing this approach will not happen overnight, even here in the United States. It is, by definition, a generational effort. But the United States and our partners have embraced the need to look over the horizon, to get ahead of the next violent extremism challenge.

At the Summit, Secretary Kerry announced: “We can send a clear signal to the next generation that its future will not be defined by the agenda of the terrorists and the violent ideology that sustains them; we will not cower, and we will prevail by working together….Our collective security depends on our collective response.” When world leaders reconvene on the margins of the United Nations General Assembly in New York this September, they will have a historic opportunity to consolidate this more comprehensive approach to counterterrorism.

STATE OF THE NATION ADDRESS BY HIS EXCELLENCY LT. GEN. SERETSE KHAMA IAN KHAMA,

STATE OF THE NATION ADDRESS BY HIS EXCELLENCY LT. GEN. SERET…

13/11/14

1. Madam Speaker, before we begin may I request that we observe a moment of silence for those of our citizens who have departed from us during the past year. Thank you. 2. Honourable Members, it is my pleasure to once more present an updated assessment of how Government intends to move Botswana forward by seizing opportunities to secure our future. 3. As this is the first session of the 11th Parliament, let me preface my remarks by welcoming the newly elected members of this Assembly. Let me further congratulate you Madam Speaker on your own election.

STATE OF THE NATION ADDRESS BY HIS EXCELLENCY LT. GEN. SERETSE KHAMA IAN KHAMA, PRESIDENT OF THE REPUBLIC OF BOTSWANA, TO THE FIRST SESSION OF THE ELEVENTH PARLIAMENT – “MOVING BOTSWANA FORWARD”

 

INTRODUCTION

 

1. Madam Speaker, before we begin may I request that we observe a moment of silence for those of our citizens who have departed from us during the past year. Thank you.

 

2. Honourable Members, it is my pleasure to once more present an updated assessment of how Government intends to move Botswana forward by seizing opportunities to secure our future.

 

3. As this is the first session of the 11th Parliament, let me preface my remarks by welcoming the newly elected members of this Assembly.  Let me further congratulate you Madam Speaker on your own election.

 

4. Today’s gathering is an outcome of our 11th consecutive general election. As is our tradition, the ballot was conducted in a peaceful, free and fair manner. For this we can once more thank Batswana in general, as well as the Independent Electoral Commission (IEC) and other individuals and organisations that helped to ensure the poll’s success.

 

5. In any democracy elections are the means to the greater end of forming a Government capable of translating the popular will into public service delivery. We who have the honour of sitting in this House are accountable to the hundreds of thousands who entrusted us with their votes. Although divided in their choices, the voters were united by a shared desire for a better future. It is, therefore, our responsibility to ensure that together we deliver that future by at all times putting the national interest before our own.

 

6. Last month my party, the Botswana Democratic Party, was re‐elected on the basis of a detailed manifesto that promised to secure our common future by building on our past achievements. Today, before this House I reaffirm our commitment to honour that pledge.

 

7. In as much as we recognise that a government of and by the people is not an event but a process; this administration shall continue to engage Batswana across the country about their concerns through various fora and media, from the venerable realm of dikgotla to the digital world of interactive online communication. It was as a result of wide-ranging consultation that our manifesto was predicated on what we understood to be our citizens’ core aspirations. These include achieving:

 

• Job creation for sustainable livelihoods and income generation;

• Food security through continued agricultural renewal;

• Expanded access to land and housing ownership;

• Access to world-class quality education that caters to current and future needs;

• Citizen, including youth, economic empowerment;

• Dignity for all through the eradication of poverty;

• Zero tolerance for corruption in all of its manifestations;

• Elimination of mother-to-child transmission of HIV; and

• Government reform that leverages on the application of new technologies. 

 

8. Each of these commitments is based on realistic analysis of where our country is and needs to go in order to meet the reasonable expectations of its people, while improving our global standing in an ever more competitive world. Taken together they are consistent with our broader vision of achieving inclusive sustainable development that upholds the dignity of all.

 

ECONOMIC OUTLOOK

 

9. Madam Speaker, owing to the prudent economic and financial management by my Government, the country was able to survive the 2008/09 global financial crisis and economic recession with minimum impact on the domestic economy. We were able to save jobs in both the public service and private sector, as well as continued to provide essential public services to our people.

 

10. Having successfully weathered the storm of the economic downturn, we can look forward to better days ahead, with economic growth buttressed by reduced inflation. These positive trends should allow us to revive some of our postponed projects, along with outstanding issues affecting the conditions of service among public employees. Our optimism is in part based on forecasts of continued, albeit still fragile, global economic recovery, with worldwide output projected to grow by 3.3% in 2014 and 3.8% in 2015.

 

11. Turning to the domestic economy, the gross domestic product (GDP) at current prices stood at P124 billion in 2013 and it is projected to expand to P136.5 billion in 2014. In real terms, the GDP grew by 5.8% in 2013, and is projected to grow by 5.2% in the current year, driven by both the mining and non-mining sectors.   Within the non-mining sector, retail and hospitality industries, as well as agriculture are experiencing growth.

 

12. Average national inflation continued to decline from 8.5% in 2011 to 7.5% in 2012 to 5.9% in 2013 and further to 4.5% in September 2014, which is well within the Bank of Botswana objective range of 3 to 6%. This positive trend gives us confidence in our ability to maintain a low inflation environment, which is necessary for domestic enterprises to compete in the global market.

 

13. In terms of our fiscal management, Government succeeded in restoring a balanced budget during 2012/13 financial year, after four years of budget deficits. For the 2013/14 financial year we were able to collect P 48.9 billion, up from the P 41.7 billion received in 2012/13, while total expenditures and net lending for 2013/14 amounted to P 41.73 billion. This resulted in a budget surplus of P7.2 billion, largely due to the good performance of the mineral sector. For 2014/15 a budget surplus of P1.3 billion is currently projected. These savings will allow us to reduce our debt burden and rebuild our financial reserves.

 

14. To sustain a positive balance sheet will, however, require expanded revenues. Here I can report that we were able to collect P48.9 billion in the 2013-14 financial year, up from the P41.7 billion received in 2012-13. The 2013/14 outturn for expenditure and net lending was P41.7 billion.

 

EMPLOYMENT

 

15.  Madam Speaker, to be meaningful to Batswana, economic growth has to be accompanied by expanded employment, which is why our manifesto listed job creation at the top of our aspirations. To reiterate what I said in my own message to the voters, of all our campaign promises tackling unemployment is the most important one. While there has been some progress in recent years, current estimates put unemployment among those 18 and above at just over 17%. Although this reflects a modest reduction since 2007, it has been insufficient to absorb all those seeking employment, especially among our talented youth. We can and shall do more.

 

16. Our Economic Diversification Drive (EDD) is a key instrument for job creation. Since its 2010 inception, EDD has been facilitating employment generating business opportunities by promoting the consumption of local products. While our immediate focus has been leveraging public procurement in support of domestic industries, as we move forward our emphasis will shift to developing greater internal capacity for export-led growth, while continuing to value local goods and services.

 

17.  So far a total of P13.3 billion worth of goods and services were recorded since the inception of the initiative. Out of this figure, the value of local manufacturers and service providers (EDD purchases) amounted to P590.5 million for 2010/2011, P1.8 billion for 2011/2012 and 2012/2013 and P2.3 billion for 2013/2014. Over one thousand enterprises have so far been registered under the EDD Programme, which has contributed to the employment of 28,000 Batswana.

 

18. We have already begun implementing our EDD Medium to Long Term Strategy, to develop sustainable sectors for economic growth and diversification. A leading example is the Leather Sub-sector Strategy, which is focused on the establishment of a Leather Park in Lobatse at a total cost of about P225 million. Government has agreed to finance the park’s primary infrastructure, a Common Effluent Treatment Plant, estimated to cost P102 million, while other components of the project will be financed through private sector investment.

 

19. Government had also budgeted over P20 million to provide temporary assistance for over 12 months to support 34 textile companies, employing 2,912 workers.

 

20. While the nurturing of SMMEs, support for existing industries and value addition remain critical in our achievement of job creation, we further anticipate that over the next few years local formal sector employment will be generated with the emergence of new economic opportunities through the synergies generated by the development growth nodes or clusters across the country.

 

21. In the Chobe region, for example, we anticipate an expansion of opportunities in tourism, construction, transport services and agriculture resulting from the construction of the road and rail bridge at Kazangula and phase one of the water pipeline to Pandamatenga, along with associated infrastructure. It is estimated that when completed these two mega-projects will create over 9000 permanent jobs.

 

22. Additional emerging labour intensive opportunities are already being generated in our urban areas, as reflected in Selebi-Phikwe’s development as a metallurgical hub, the continued growth of Gaborone as a global diamond as well as regional technical services centre, and Francistown’s growth as a nexus for trade and transport. We further anticipate additional jobs through synergies generated by new mining activities, the continued expansion of commercial agriculture and the development of Trans-Kgalagadi road and potential rail corridor.

 

COMPETITIVENESS    

 

23. A key to unlocking these job creation opportunities will be increasing our global competitiveness. To improve our competitiveness ranking in the area of goods market efficiency we have tightened our market monitoring for greater efficiency in the provision of goods and services, while the Competition Authority is reviewing mergers and potential cartel activity involving both local and foreign companies.

 

24. Madam Speaker, job creation is inevitably linked to investment. In this respect the latest FDI Intelligence report indicates that Global Greenfield FDI showed signs of recovery, increasing by an estimated 11% from 2012 to 2013. The increase in local investment has been even greater, with UNCTAD’s 2014 World Investment report showing Botswana having grown by 27% in 2013.

 

25.  The Botswana International Trade Centre (BITC) continues to promote our country as a competitive location for investment, making business contacts and generating leads. During the 2013-2014 financial year, BITC helped realise a total combined investment capital of just over 1 billion pula, of which P 642 million was from foreign direct investment (FDI) and P449 million came from new domestic investments. In 2012/13, BITC further recorded P1.9 billion worth of goods and services exported into the region and beyond, of which P738 million was attributable to financial and international business services by the financial services cluster.

 

26. Botswana was ranked number one in the 2014 Baseline Profitability Index, surpassing Hong Kong as a location for medium to long term returns on investment. In essence the Index suggests that investors can expect to do well here once they have established themselves in our market.

 

27. Government is, furthermore, working to limit the number of licenses and permits, while allowing mixed land use zoning, adopting risk based approach for Environmental Impact Assessments and Management Plans, and decentralising the management of electricity connections.

 

28.  Government has also embarked on a National Work Ethic programme to promote productivity. So far, 254 facilitators have been assessed to implement the programme, which commenced in May 2014.

 

29. The drafting of a Bill which will provide the legal framework for the establishment of Special Economic Zones and the Special Economic Zone Authority is being finalized.

 

30. The Rural Development Council (RDC) has been upgraded as the national consultative body to promote and coordinate the implementation of rural development policies and programmes. As a result community based projects such as the Zutshwa Salt Project and the Mogobane Irrigation Scheme, to mention some, have been resuscitated.

 

CITIZEN EMPOWERMENT

 

31. Madam Speaker, it is pleasing to note that to date, CEDA has funded 5,462 enterprises with a total value of nearly P8.55 billion, in the process creating over 48,935 thousand jobs.  During the 2013/14 financial year, CEDA assisted 151 new enterprises with a total monetary value of P152 million, collectively generating 1042 new jobs.

 

32. Since its inception, LEA has also facilitated the creation of 4995 new jobs, including 568 in the ongoing financial year. The Authority has further trained a total of 9,317 entrepreneurs. In an effort to inculcate an entrepreneurial culture, LEA embarked upon the Entrepreneurship Awareness Workshops among secondary school leavers, vocational trainees and prison inmates; over 26,000 of whom have been trained.

 

33. Madam Speaker, through the Botswana Bureau of Standards (BOBS), we have encouraged our small and medium enterprises to implement quality assurance activities within their businesses. Progress has been made in certification of goods especially in the building and construction industry. To further ensure that prescribed goods entering our borders comply with domestic standards, a BOBS office has been opened at the Tlokweng Border.

 

RULE OF LAW

 

34. Madam Speaker, adherence to the rule of law remains a cornerstone to our national development. It is thus encouraging that independent comparative surveys, as well as domestic polling, consistently place us among the best in the world as well as first in Africa in terms of our upholding the rule of law while ensuring the safety and security of all our citizens. These surveys include:

 

• 2014 Ibrahim Index of African Governance, where we ranked first in the category of safety and security;

• World Justice Project’s 2014 Rule of Law Index, where we were ranked 25th in the world as well as first in Africa;

• 2014 Global Peace Index where we were at 36th place, ranking above half of European countries surveyed;

• 2014 Legatum Index for Governance and Rule of Law, where we were ranked 28th in the world; and

• 2013 Global Democracy Index, where besides ranking 35 out of 167 countries we achieved a near perfect score in the area of civil liberties.

 

35.  In light of such reputable findings it is unfortunate to say the least that some individuals, working through foreign as well as domestic media, including rumour mongering on social media, have attempted to instil the perception of Batswana living in fear. This is in an apparent effort to undermine this country’s longstanding and shared record of peace, order and good Government.

 

36. While the mass circulation of false and malicious reports intended to incite undue alarm may be aimed at promoting the political agenda of some, it is at the collective cost of tarnishing the image of the country as a whole. It is also a threat to the economy we all must depend upon for our livelihoods. Such disinformation should therefore be rejected with contempt by all peace-loving Batswana. All citizens, residents and potential visitors to Botswana can be confident that this Government will continue to both abide and uphold the rule of law without fear or favour.

 

37. Let me, nonetheless, also observe that we have not, and shall not, allow past achievements or international accolades to breed complacency as we recognise that, here as elsewhere, criminal activity is constantly evolving and increasingly sophisticated. We therefore remain determined to pursue a zero tolerance approach to all forms of criminal activity, including corruption.

 

38. To counter emerging domestic and trans-national challenges the Police Service has deployed integrated law enforcement strategies to combat all forms of criminality and anti-social behaviour. This has involved an ongoing redirection of resources to deal with violent and intrusive, cross border and cyber based criminal activities.

 

39. Whilst total recorded crime excluding road traffic violations rose by 4.7% during the year 2013, significant reductions were, however, registered in respect of violent and intrusive crimes.  Offences in this category, which included burglary, store breaking, robbery, house breaking, threats to kill, murder, rape, motor vehicle and stock theft, declined by 15.4%.

 

40. Road traffic management poses an additional policing challenge. Analysis of road accidents shows a youth bias, expressed in reckless driving, often aggravated by the influence of alcohol. As a result of the increase in the intensity of road policing initiatives, the number of detected road traffic offences rose by 32.4%, while there was a corresponding decrease in the number of fatal road accidents by 2.6%.

 

41. Madam Speaker, the Department of Prisons and Rehabilitation continues to improve security in the prisons and rehabilitation of offenders. While overcrowding has been a problem in some of the Prison institutions, there has been substantial reduction in congestion since 2008. In June 2014 there were 3824 offenders held in prisons, which was 13% below the authorised holding capacity.

 

42. Madam Speaker, the internal and external challenges of today’s constantly changing security landscape, call for a structurally aligned, strategically focused and adequately resourced, as well as highly trained and motivated, defence force. The BDF will thus continue to evolve its structures and strategies to defend the nation, while continuing to provide assistance to other law enforcement agencies in combating crime, including poaching.

 

ACCESS TO JUSTICE

 

43. Madam Speaker, as was most recently demonstrated in the Judgments of the High Court and the Court of Appeal upholding the constitutionality of the Standing Orders of this very House, our Judiciary continues to independently and effectively deliver on its constitutional mandate of settling disputes, both large and small, without fear or favour.  This Government will, as always, respect decisions of the Courts and expects all citizens to do the same.  Equally, we must all display tolerance and recognize everyone’s right to approach the Courts for the resolution of any legal issue no matter how strongly we may disagree.

 

44. To improve everyday access to justice several special court projects like the stock theft, maintenance, traffic, small claims and most recently corruption court have been put in place so as to speed up and improve the case disposal rates, while promoting greater access to justice by simplifying court rules and processes to make them more user friendly.  In addition a Court Annexed Mediation will be in place by the end of the current financial year.  This f

Press Releases: Outcomes from the International Telecommunication Union 2014 Plenipotentiary Conference in Busan, Republic of Korea

The International Telecommunication Union (ITU) Plenipotentiary Conference, which concluded on November 7, is a three week, high-level policy conference held every four years. Ambassador Daniel Sepulveda, U.S. Coordinator for International Communications and Information Policy, led the U.S. delegation to a successful outcome that will greatly support the development of global telecommunications infrastructure and networks. The Plenipotentiary Conference sets the ITU general policies, adopts four-year strategic and financial plans, and elects the ITU senior management team, members of Council, and members of the Radio Regulations Board for the next four years.

The U.S. delegation achieved its four primary objectives, and all outcomes were agreed by consensus with other member states. The U.S. delegation was elected to another four year term on the ITU Council with more votes than we received four years ago, and Ms. Joanne Wilson was elected to the Radio Regulations Board (RRB). Member states improved the ITU’s fiscal and strategic management and transparency policies and improved the ability of all stakeholders to view and participate in the work of the Union. The member states agreed to no changes to the ITU’s legal instruments (the Constitution and Convention of the Union). Finally, member states decided not to expand the ITU’s role in Internet governance or cybersecurity issues, accepting that many of those issues are outside of the mandate of the ITU. The leadership of the U.S. delegation was instrumental to each of these efforts.

Elections

Ambassador Sepulveda was selected as Vice Chairman of the Plenipotentiary Conference for the America’s region. On October 27, the United States was reelected to the ITU Council, receiving 22 more votes than at the last Plenipotentiary Conference in Guadalajara. The United States has continuously held a seat on the Council since 1947.

Joanne Wilson, a private sector member of the delegation who supports NASA, was elected to the Radio Regulations Board (RRB) by a wide margin. Ms. Wilson’s election not only keeps an American on the RRB, but also contributes to the gender balance of the board, as Julie Zoller’s term on the RRB ends this year.

Internet and Cybersecurity Issues

The United States built a broad consensus that led to success on Internet and cybersecurity issues keeping the ITU’s work focused on its current mandate. The United States worked with other members to mitigate and remove proposed language from resolutions that would have improperly expanded the scope of ITU work and curtail the robust, innovative, multi-stakeholder Internet we enjoy today, while providing clear guidance to the ITU on the efforts it can and should work on.

The U.S. also worked successfully with partners to eliminate proposed language that could have provided a mandate for the ITU in surveillance or privacy issues; inhibited the free flow of data; regulated Internet content and service companies; undermined the multi-stakeholder process; or called on the ITU to develop international regulations on these issues.

Finally, a compromise was reached on the Council Working Group on International Internet-related Public Policy (CWG-Internet), which will provide for physical consultation meetings, open to all stakeholders, to be held prior to each of the CWG-Internet meetings. These meetings will allow all Internet stakeholders to directly contribute to the work of the CWG-Internet.

Financial and Management Reform

The United States worked with other member states to build consensus and approve resolutions to develop a strategy for greater coordination between the three ITU sectors, enhance membership oversight of memoranda of understanding with financial or strategic implications, and execute the ITU strategic plan over the next four years. Members states also agreed to make input and output documents for ITU conferences and assemblies freely and publicly available online. The ITU Council Working Group on Financial and Human Resources will develop a new policy on document access that ITU Council is authorized to adopt. External audit reports as well as the report by the Independent Management Advisory Committee (IMAC) will also be made freely available online.

The ITU financial plan stresses efficiency savings and increasing contributory units from member states, instead of new charging schemes and a withdrawal from the reserve account to address a budget deficit.

International Telecommunication Regulations

The U.S. delegation secured agreement that another World Conference on International Telecommunications (WCIT), the conference that revises the International Telecommunication Regulations (ITR’s) should not be scheduled until an expert group reviews the existing treaty regulations from 2012 and assesses whether any update is necessary. This expert group will submit recommendations that will be forwarded to the next Plenipotentiary Conference in 2018 for it to decide on whether to schedule another WCIT treaty conference.

Radiocommunication Issues

The Plenipotentiary Conference successfully addressed six Radiocommunication related matters, all in a manner consistent with U.S. objectives.

The Plenipotentiary Conference decided that the World Radiocommunication Conference (WRC) would be the appropriate body to address the conditions under which the RRB would reconsider a previous decision. Additionally, all members of the RRB will sign a declaration committing to adhere to the relevant provisions of the ITU Constitution and avoid conflict of interests.

The Union reached consensus on the U.S. proposal that the WRC is the proper conference to examine and modify the procedures for registering frequencies used by satellite networks and not the Plenipotentiary Conference.

The Plenipotentiary Conference decided that the ITU could continue to express interest in taking on the role of the Supervisory Authority of the International Registration System for Space Assets and that Council would continue to monitor developments.

The Plenipotentiary Conference decided to bring the issue of extending the deadline for bringing into operation a Colombian satellite system (SATCOL) to the attention of the next WRC.

The Union achieved consensus on a new resolution on strengthening the role of ITU with regard to transparency and confidence-building measures in outer space activities and dealt with the ITU Radiocommunication Bureau’s role in addressing harmful radio-frequency interference to satellite transmissions, particularly to international broadcast transmissions.

The United States supported adding the issue of global flight tracking to the WRC-15 agenda.

Conformance and Interoperability and Counterfeit

The Union achieved consensus on modifying the existing conformance and interoperability resolution to address capacity building activities in developing countries and to use the results of existing conformity assessment systems to address their needs. Member states agreed to a new resolution to address the proliferation of counterfeit products.

More information and public statements on the ITU Plenipotentiary Conference can be found here:

Secretary Kerry’s Statement on the U.S. Delegation to the International Telecommunication Union Plenipotentiary Conference

Media Note: U.S. Delegation to the International Telecommunication Union Plenipotentiary Conference in Busan, Republic of Korea

U.S. Government Policy Statement at the International Telecommunications Union Plenipotentiary Conference

Remarks by the President at Nomination of Loretta Lynch for Attorney General

The White House

Office of the Press Secretary

For Immediate Release

November 09, 2014

Roosevelt Room

11:27 A.M. EST

THE PRESIDENT:  Have a seat, everybody.  Good morning.  As President, I rely on my Cabinet every day to make sure that we are not just getting the job done, but we’re making progress for the American people.  And in a country that is built on the rule of law, there are few offices more important than that of Attorney General.

The Attorney General is the people’s lawyer.  As our nation’s chief law enforcement officer, the person in this position is responsible for enforcing our federal laws, including protecting our civil rights.  Working with the remarkable men and women of the Justice Department, the Attorney General oversees the vast portfolio of cases, including counterterrorism and voting rights; public corruption and white-collar crime; judicial recommendations and policy reviews –- all of which impact on the lives of every American, and shape the life of our nation.

As I said back in September when he decided to step down, I am enormously grateful to Eric Holder for his outstanding service in this position.  He is one of the longest-serving Attorney Generals in American history, and one of our finest.  Eric brought to this job a belief that justice isn’t just an abstract theory, but a living, breathing principle.  It’s about how laws interact with the daily lives of our people -– whether we can make an honest living, whether we can provide for our families; whether we feel safe in our own communities and welcome in our own country; whether the words that the founders set to paper 238 years ago apply to every one of us in our time.

So thanks to Eric, our nation is safer and freer, and more Americans — regardless of race or religion, or gender or creed, or sexual orientation or disability -– receive fair and equal treatment under the law.  I couldn’t be prouder of Eric.  And I couldn’t be prouder that today, I can announce somebody who shares that fierce commitment to equal justice under the law as my nominee for the next Attorney General, U.S. Attorney Loretta Lynch.  (Applause.) 

I also, by the way, want to thank the chair of the Senate Judiciary Committee, Patrick Leahy, for being here on a Saturday to show his support.  (Applause.)   

It’s pretty hard to be more qualified for this job than Loretta.  Throughout her 30-year career, she has distinguished herself as tough, as fair, an independent lawyer who has twice headed one of the most prominent U.S. Attorney’s offices in the country.  She has spent years in the trenches as a prosecutor, aggressively fighting terrorism, financial fraud, cybercrime, all while vigorously defending civil rights.

A graduate of Harvard College and Harvard Law School, Loretta rose from Assistant U.S. Attorney in the Eastern District of New York to Chief of the Long Island Office, Chief Assistant U.S. Attorney, and U.S. Attorney.  She successfully prosecuted the terrorists who plotted the bomb — plotted to bomb the Federal Reserve Bank and the New York City subway.  She has boldly gone after public corruption, bringing charges against public officials in both parties.  She’s helped secure billions in settlements from some of the world’s biggest banks accused of fraud, and jailed some of New York’s most violent and notorious mobsters and gang members. 

One of her proudest achievements was the civil rights prosecution of the officers involved in the brutal assault of the Haitian immigrant Abner Louima.  Loretta might be the only lawyer in America who battles mobsters and drug lords and terrorists, and still has the reputation for being a charming “people person.”  (Laughter.)   

That’s probably because Loretta doesn’t look to make headlines, she looks to make a difference.  She’s not about splash, she is about substance.  I could not be more confident that Loretta will bring her signature intelligence and passion and commitment to our key priorities, including important reforms in our criminal justice system. 

She has consistently proven her leadership and earned the trust and respect of those she serves.  Since 2010, she has been a member of the committee of the U.S. Attorneys across the nation who advise the Attorney General on matters of policy, and she has served as chair of that committee since 2013.  So it’s no wonder that the Senate unanimously confirmed her to be the head of the U.S. Attorney’s Office in two separate situations –- once under President Clinton and once under my administration.  And it’s my hope that the Senate will confirm her a third time without delay.

At every stage in her career, Loretta has followed the principles of fairness, equality, and justice that she absorbed as a young girl.  She was born in Greensboro, North Carolina, the year before black students there sat down at a whites-only lunch counter, helping to spark a movement that would change the course of this country. 

The daughter of a school librarian and a fourth-generation Baptist minister — which meant that she knew when to be quiet — (laughter) — that’s a little intimidating, being the daughter of a librarian and a minister — (laughter) — Loretta rode on her father’s shoulders to his church, where students would meet to organize anti-segregation boycotts.  She was inspired by stories about her grandfather, a sharecropper in the 1930s, who helped folks in his community who got in trouble with the law and had no recourse under the Jim Crow system.  I know that if he were here today, he would be just as proud of her as I’m sure her husband Stephen is.  I want to thank Stephen, Loretta’s stepson Ryan, her stepdaughter Kia, and her other family members who came here today.  We appreciate you guys agreeing to share her with the American people a little bit longer. 

Loretta has spent her life fighting for fair and equal justice that is the foundation of our democracy.  I can think of no better public servant to be our next Attorney General.  Let me introduce to you, Ms. Loretta Lynch.  (Applause.) 

MS. LYNCH:  Thank you, everyone.  And thank you, first of all, Mr. President, for that kind introduction.  But most importantly, thank you also for your faith in me in asking me to succeed an Attorney General whom I admire, and to lead the Department that I love.

Now, no one gets to this place, this room, this podium, this moment by themselves.  I also must thank Attorney General Eric Holder for your support and your friendship over the years, as well as by leading by example, and always, always pushing this Department to live up to its name.  And I want to thank Chairman Leahy, senior officials of the Department of Justice, and members of the Cabinet for being here today.

To my colleagues in the U.S. Attorney community and throughout the Department, on whose strength and wisdom I lean every day, thank all of you, as well, for your support both now and in all the work that we have ahead. 

And to my beloved office, the Eastern District of New York, my professional home — you have twice now given me the privilege of being able to serve you, and to focus on nothing — nothing — but the protection of the American people.  It has been a joy.  It has been an honor.  And I will carry you with me wherever I go.  

And of course, to my wonderful family, several of whom are here with me today, all of whom are always with me in love and support — most especially my parents, who could not be here today but are watching, whose every thought and sacrifice has always been for their children.  They have supported me in all of my endeavors as I strive to live up to their example of service. 

The Department of Justice is the only Cabinet Department named for an ideal.  And this is actually appropriate, because our work is both aspirational, and grounded in gritty reality.  It’s both ennobling, and it’s both profoundly challenging.

Today, I stand before you so thrilled, and, frankly, so humbled to have the opportunity to lead this group of wonderful people who work all day and well into the night to make that ideal a manifest reality, all as part of their steadfast protection of the citizens of this country.

Mr. President, thank you again for the faith that you’ve placed in me.  I pledge today to you and to the American people that if I have the honor of being confirmed by the Senate, I will wake up every morning with the protection of the American people my first thought.  And I will work every day to safeguard our citizens, our liberties, our rights, and this great nation which have given so much to me and my family.

I thank you again, Mr. President and Mr. Attorney General, and all of you, for being here.  (Applause.) 

Q    — the release of Americans from North Korea today?

THE PRESIDENT:  Well, I think it’s a wonderful day for them and their families.  And obviously, we’re very grateful for their safe return.  And I appreciate Director Clapper doing a great job on what was obviously a challenging mission.

END     11:37 A.M. EST

Remarks by the Vice President at the John F. Kennedy Forum

The White House

Office of the Vice President

For Immediate Release

October 03, 2014

Harvard Kennedy School
Boston, Massachusetts

6:37 P.M. EDT

THE VICE PRESIDENT:  Well, Dean, you did that introduction exactly like my sister wrote it sounds like.  (Laughter.)  Thank you.  That was very, very generous of you.

And as we used to say in the Senate, please excuse the point of personal privilege.  There are three reasons why I’ve won the races I’ve won and why I sustained winning, and they’re right here in this front row.  The first one is my sister, but also the guy who got me through the 1972 campaign is one of the best political strategists I have ever known, and a man who is — as Frank — is that you, Frank, back there?  Frank Fahrenkopf, the former chairman of the Republican Party.  We’ve known each other a long time, back to the days when we really liked one another, Republicans and Democrats.  (Laughter.)  We still do.  It’s great to see you, Frank.

But as Frank can tell you and anyone else can tell you that the one thing when you hire a political consultant that you most are concerned about — and I mean this sincerely — is will they reflect your values.  This guy that I’m about to introduce to you has more integrity in his little finger than most people have their whole body, but is the reason I overcame that deficit — John Marttila, a native Bostonian here. 

And the guy sitting next to him who has fought in Vietnam and came back to fight against the war in Vietnam and has become my friend.  And if you ever have to — that old joke, if you have to be in a foxhole, this is the guy you want with you, Professor Tommy Vallely (ph).  Tommy, it’s great to see you.  I didn’t expect to see you.

And it’s great to be here.  And I have one plea, don’t jump.  (Laughter.)  Don’t jump.  It’s good to be back.

I understand that Senator Markey may be here.  I hope for his sake he’s not and he’s out campaigning because — but I was told he might be, and Congressman Delahunt, two fine friends.  If they’re here I want to acknowledge them.

Folks, “all’s changed, changed utterly.  A terrible beauty has been born.”  Those are the words written by an Irish poet William Butler Yeats about the Easter Rising in 1916 in Ireland.  They were meant to describe the status of the circumstance in Ireland at that time.  But I would argue that in recent years, they better describe the world as we see it today because all has changed.  The world has changed.

There’s been an incredible diffusion of power within states and among states that has led to greater instability.  Emerging economies like India and China have grown stronger, and they seek a great force in the global order and global affairs. 

Other powers like Russia are using new asymmetrical forms of coercion to seek advantage like corruption and “little green men,” foreign agents, soldiers with a mission but no official uniform.  New barriers and practices are challenging the principles of an open, fair, economic competition.  And in a globalized world, threats as diverse as terrorism and pandemic disease cross borders at blinding speeds.  The sheer rapidity and magnitude, the interconnectedness of the major global challenges demand a response — a different response, a global response involving more players, more diverse players than ever before.

This has all led to a number of immediate crises that demand our attention from ISIL to Ebola to Ukraine — just to name a few that are on our front door — as someone said to me earlier this week, the wolves closest to the door.

Each one in its own way is symptomatic of the fundamental changes that are taking place in the world.  These changes have also led to larger challenges.  The international order that we painstakingly built after World War II and defended over the past several decades is literally fraying at the seams right now.

The project of this administration, our administration at this moment in the 21st century, the project that President Obama spoke about last week at the United Nations is to update that order, to deal with these new realities, but also accommodate and continue to reflect our enduring interests and our enduring values.

And we’re doing this in a number of ways.  First, by strengthening our core alliances; second, building relationships with emerging powers; third, defending and extending the international rules of the road that are most vital; and fourthly, confronting the causes of violent extremism.  But all of this rests on building a strong, vibrant economy here at home to be able to underpin our ability to do anything abroad.

So tonight I want to talk to you about our efforts and provide, as best I can, an honest accounting of what it’s going to take for America to succeed in the beginning of the 21st century.

The first thing we have to do is to further strengthen our alliances.  Many of the challenges we face today require a collective response.  That’s why we start from a foundation of the strong alliance we’ve had historically in Europe and in Asia, a feature of American strength unmatched by any other nation in history and built on a sacred commitment to defend one another, but also built on shared political and economic values.

One of the cornerstones of our foreign policy is the vision we share with our NATO allies of a Europe whole and free, where every nation can choose the path it wishes with no interference.  But that vision has been recently challenged.  We’ve seen aggression on Europe’s frontier.  And that’s why we’ve moved to mobilize our NATO allies to step up and provide significant security assistance to Ukraine. 

Each of the 28 NATO allies has now committed to providing security assistance to Ukraine, including over $115 million from the United States.  And as we respond to the crisis in Ukraine, we are determined that NATO itself emerge stronger from the crisis thrust on us by Russia.  With our allies, we are increasing deployments on land, sea and in the skies over Central and Eastern Europe.

And at the most recent NATO Summit in Wales, the Alliance agreed to create a Rapid Response Force to make sure that NATO is ready and can respond to any contingency.  And we’re increasing exercises and capacity building with non-NATO nations, countries in European — on Europe’s eastern frontier to ensure that they too can exercise their right to choose their own future, and that NATO’s door remains open.

But beyond mutual defense, we’re working closely with Europe on everything from trade to counterterrorism to climate change.  But we have to be honest about this and look it squarely in the eye, the transatlantic relationship does not sustain itself by itself.  It cannot be sustained by America alone.  It requires investment and sacrifice on both sides of the Atlantic, and that means ensuring that every NATO country meets its commitment to devote 2 percent of its GDP to defense; establishing once and for all a European energy strategy so that Russia can no longer use its natural resources to hold its neighbors hostage.  Reaching a final agreement on the so-called Transatlantic Trade and Investment Partnership, the new mechanism to try to strengthen the economic engines to sustain our mutual efforts in Europe and at home.

To the East, for six decades, America’s alliances in Asia have made possible the security and stability that has flowed from — that has allowed the economic miracle.  When I met not long ago and I met many, many hours with President Xi — I probably had dinner alone with him over 22, 23 hours over two five-day periods, talking about — I mentioned that America — I made clear that America is a Pacific power and we will remain a Pacific power.  And us in the area is the reason for the existence of a stability in Asia for the past 50 years.  That’s why it’s essential that we modernize our Pacific alliances, updating our posture and expanding our partnerships to meet the new challenges we face.

America today has more peacetime military engagements in the Asia Pacific than ever before.  By 2020, 60 percent of our naval assets and 60 percent of our air power will be stationed in the Pacific.  We’re supporting Japan’s efforts to interpret its constitution to allow it to play a larger security role.  We’ve signed enhanced defense cooperation agreements with the Philippines.  We’re strengthening our missile defense capabilities in the region to deter and defend against North Korea.  And three years ago, we had no forces in Australia; today, we have more than a thousand Marines rotationally deployed in Darwin.  And we have a growing partnership with Vietnam, in no small part — by the way — to the work of Tommy Vallely and his colleagues actively engaged in regional organizations like ASEAN.

We have an historic opportunity as well to build a new relationship with Burma if we get lucky.  But our Asian allies also have tough choices to make.  We cannot do this on our own.  It will relate to their willingness to work closely and more closely with one another.  As the President and I have done in meetings with the leaders of Japan and South Korea, we’re going to continue to promote trilateral cooperation among our allies and partners in the Pacific to make the most of those ties that will benefit the entire region if we succeed.

In the Middle East, our alliances are also crucial.  We will never waver from our steadfast support for Israel, and we’re working alongside a coalition of Arab partners and countries from around the world to confront ISIL. 

So even as we strengthen our traditional alliances, we’re building wider coalitions to bolster the world’s ability to respond to these emerging crises.

Take Ebola.  A horrific disease that is now a genuine global health emergency.  Our Centers for Disease Control, USAID and our military have taken charge of that world epidemic.  We are organizing the international response to this largest epidemic in history.  The President rallied the world at the United Nations last week, mobilizing countries from all around the world to act, and to act quickly.  We’re deploying over 3,000 American soldiers to West Africa to support regional civilian responses and advance the effort in fighting the disease of Ebola.

The second thing we have to do besides strengthening our alliances and cooperation, we have to effectively manage our relationships with emerging powers of the 21st century.  And that means putting in the effort to realize the potential of America’s friendship with emerging democratic partners like Brazil and President Dilma, President Peňa Nieto in Mexico, Prime Minister Modi in India, who just made a historic visit to the United States this week.

Each of these relationships has a significant potential to genuinely, genuinely promote shared interest and shared ideals.  But each one has to overcome domestic politics, bureaucratic inertia, and a significant legacy of mistrust over the last century.  But there is great potential here, but there is no guarantees.  There is no substitute for direct engagement and an unstinting effort to bridge the gap between where we are today and where we can and should be tomorrow.

The world in which emerging powers and responsible stakeholders promoting common security and prosperity has yet to arrive, but it’s within our grasp to see that happen.  That’s why we’ve embraced the G20 as a model for economic cooperation.  That’s why it’s also important that we fully support international institutions like the IMF, fund them and reform and modernize them to better serve all nations.

But managing our relationship with China is the single most essential part of the strategy at which we must succeed.  Even as we acknowledge that we will often be in competition, we seek deeper cooperation with China, not conflict. 

Nowhere is it written that there must be conflict between the United States and China.  There are no obvious, obvious impediments to building that relationship.  And we’re committed to building up that partnership where we can, but to push back where we must.  The President plans to visit China this fall as part of his second trip to Asia this year.  This is the kind of engagement that is necessary for us to come together and do consequential things.

At Sunnylands, when he met with President Xi last, they reached an historic agreement on the super pollutant known as HFCs, hydrofluorocarbons.  And our hope is that this year we can continue to expand our cooperation with China on climate and environment, but also be very direct about our differences.  That’s why in a five-hour meeting I had with President Xi this past December — after they had several days earlier announced unilaterally an air defense identification zone, contrary to international law — I sat with President Xi and I told him bluntly, Mr. President, understand one thing.  We do not recognize it, we do not honor it, and we’re flying a B-52 through it.  Understand. (Laughter.)  No, I’m serious.  I’m not asking you to do anything.  I’m not asking you to renege.  Just understand — we will pay no attention whatsoever to it.  It’s important.  It’s important that in emerging relationships there be absolute, frank, direct discussions.
 
That’s why we’ve made clear as well that freedom of navigation must be maintained in the South China Sea.  But that’s also why President Obama has been direct in public and private with China’s leaders on cyber theft.  And as the world watches Hong Kong’s young people take to the streets peacefully to demand respect for their own rights, we’ll also never stop standing up for the principles we believe in that are universal — democratic freedoms and human rights.

President Xi asked me, why do we focus on human rights so much?  I’m serious.  And I gave him a direct answer — which is almost unique to the United States; it doesn’t make us better or worse, but unique to the United States.  I said, Mr. President, even if a President of the United States did not want to raise human rights abuses with you to have a better relationship on the surface, it would be impossible for him or her to do that — for the vast majority of the American people came here to seek human rights and freedom.  It is stamped into our DNA.  It is impossible for us to remain silent.  Again, he took it on board — and it’s important to understand why we do it.  It is not a political tool.  It is who we are.
 
To build these robust relationships with emerging powers, we also have to demonstrate staying power — which is hard and costly — in places that will do the most to shape the world that our grandchildren are going to inherit.  That’s why our rebalance to the Asia-Pacific region depends in no small part on completing a trade initiative known as the Trans-Pacific Partnership.  And that’s the whole Pacific — from Peru all the way to Japan. 
It’s a partnership that will stitch together the economies of 12 Pacific nations, stretching from South America to Asia, united behind rising standards regarding labor, the environment, and fair completion.  Once completed, these trade agreements we are negotiating across the Atlantic and the Pacific will encompass nearly two-thirds of the global trade in the world, and can shape the character of the entire economic global economy.

The Trans-Pacific Partnership also has a profound strategic — not just economic — strategic element to it.  Because deeper economic ties cement our partnerships but, most of all, help small nations resist the blackmail and coercion of larger powers using new asymmetric weapons to try to achieve their ends in other countries.

And this brings me to the Western Hemisphere, a vital part of the Pacific equation, but where there’s another great opportunity.  The President asked me to oversee our hemispheric relations.  And for the first time in history, you can truly envision a Western Hemisphere that is secure, democratic and middle class, from northern Canada to southern Chile, and everywhere in between.  But we have to overcome centuries of distrust.  We can no longer look at the region in terms of what we can do for it.  The question is what can we do together in this hemisphere.  And the possibilities are endless.

On energy, North America is literally — not figuratively — the epicenter of energy in the world today.  There are more rigs, gas and oil rigs in the United States pumping today than every other nation in the world combined.  Combined.  North America will account — meaning Mexico, China and Canada — for two-thirds of the growth of global energy supply over the next 20 years.  By 2018, the United States will be a net exporter of natural gas, and most projections show North America will be totally energy independent by 2020, and the United States shortly thereafter.
 
Look at the hemisphere in terms of trade.  Forty percent of all our exports stay in this hemisphere — 40 percent.  We have $1.3 trillion in trade in a yearly basis just in North America, including $1.3 billion per day with Mexico alone.
 
On security, we partnered with Colombia and Mexico and others to combat the scourge of drug trafficking.  We’re helping Central American countries address the root causes of poverty and violence and migration.

But to realize the potential of our partnerships in the region, we have to be present, we have to build that trust — which is why I’ve made five trips to Latin America just in the last — and to South America as well — just in the last 18 months.
 
It’s why we have to pass immigration reform here in the United States.  It’s one thing to say we respect the rest of the Americas, the majority of which are Hispanic.  But it’s another thing to say I respect them and yet not respect the immigrant population that’s the Hispanic community of the United States.  It does not connect.

The single most significant thing we can do to fundamentally change the relationship in terms of trust and commitment is to pass immigration reform.  Those of you who travel to or are from Central and South America know of what I speak.  Because respecting immigrants from the Americas is part of how we show that we really have changed our view, that South and Central America is no longer our back yard; it is our front yard.  It is our partner.  The relationship is changing.  And when it changes fully the benefits for us are astounding.

The third thing we need to do — and are doing — is to defend and extend the international rules of the road and deal with asymmetrical threats that are emerging.  The international system today is under strain from actors pushing and sometimes pushing past the limits of longstanding important international norms like nonproliferation and territorial integrity.  That’s why we insisted that Syria remove its chemical weapons stockpile and the means to manufacture them.  So we assembled under great criticism a coalition with Russia and others to remove Syria’s chemical stockpile.  That’s why have made it clear to Iran that we will not allow them to acquire a nuclear weapon.  So we’ve put together the single most effective, international sanctions in history to isolate Iran, and to push them back to the negotiating table.

Elsewhere, actors are subverting the fundamental principle of territorial integrity through the use of new asymmetric tactics, the use of proxies to quietly test the limits and probe the weaknesses across boundaries and borders on land and sea; the use of corruption as a foreign policy tool, unlike any time in modern history, to manipulate outcomes in other countries in order undermine the integrity of their governmental institutions.  That’s exactly what’s happening in Ukraine today. 

Putin — President Putin was determined to deny Ukraine and the Ukrainian people the power to make their choices about the future — whether to look east or west or both.  Under the pretext of protecting Russian-speaking populations, he not only encouraged and supported separatists in Ukraine, but he armed them.  He sent in Russian personnel out of uniform to take on the Ukrainian military, those little, green men.

    And when that wasn’t enough, he had the audacity to send Russian troops and tanks and sophisticated, air-defense systems across the border.  But we rallied the world to check his ambitions and defend Ukrainian sovereignty.  We didn’t put boots on the ground. 

Putin sought to prevent a free and open election.  We rallied the world to help Ukraine hold quite possibly the freest election in its history.  Putin sought to destabilize Ukraine’s economy.  We provided a billion dollars directly from the United States and worked with the IMF on a $27 billion international rescue package to keep them from going under.

Putin sought to keep Ukraine weak through corruption.  We’re helping those leaders fight back corruption, which by the way is an issue that demands our leadership around the world, by helping them write new laws, set up a new judiciary and much more.  Putin sought to hollow out Ukraine’s military the last 10 years, and he was very successful.  But we rallied NATO and NATO countries to begin to build that military capability back up.  Putin sought to keep secret Russian support for separatists who shot down a civilian airliner.  We exposed it to the world, and in turn rallied the world.  And remember this all began because Putin sought to block Ukraine’s accession agreement with the European Union.  Well, guess what:  That agreement was signed and ratified several weeks ago.

Throughout we’ve given Putin a simple choice:  Respect Ukraine’s sovereignty or face increasing consequences.  That has allowed us to rally the world’s major developed countries to impose real cost on Russia.

It is true they did not want to do that.  But again, it was America’s leadership and the President of the United States insisting, oft times almost having to embarrass Europe to stand up and take economic hits to impose costs.  And the results have been massive capital flight from Russia, a virtual freeze on foreign direct investment, a ruble at an all-time low against the dollar, and the Russian economy teetering on the brink of recession.

We don’t want Russia to collapse.  We want Russia to succeed.  But Putin has to make a choice.  These asymmetrical advances on another country cannot be tolerated.  The international system will collapse if they are.

And to state the obvious, it’s not over yet.  And there are no guarantees of success.  But unlike — the Ukrainian people have stood up.  And we are helping them, leading and acting strategically. 

The fourth element of our strategy is countering violent extremism.  As you know, we’ve engaged in a relentless campaign against terrorists in Afghanistan, in the so-called FATA, in Pakistan, Somalia and elsewhere.  This campaign against violent extremism predates our administration, and it will outlive our administration.  But we’ve made real progress against al Qaeda’s core and its affiliates since 9/11.  But this threat of violent extremism is something we’re going to have to contend with for a long time. 

Today, we’re confronting the latest iteration of that danger, so-called ISIL; a group that combines al Qaeda’s ideology with territorial ambitions in Iraq and Syria and beyond, and the most blatant use of terrorist tactics the world has seen in a long, long time.  But we know how to deal with them.

Our comprehensive strategy to degrade and eventually defeat ISIL reflects the lessons we have learned post-9/11 age about how to use our power wisely.  And degrading them does not depend upon an unsustainable deployment of hundreds of thousands of boots on the ground.  It’s focused on building a coalition with concrete contributions from the countries in the region.  It recognizes outside military intervention alone will not be enough.  Ultimately, societies have to solve their own problems, which is why we’re pouring so much time and effort into supporting a Syrian opposition and Iraqi efforts to re-establish their democracy and defend their territory.  But this is going to require a lot of time and patience.

The truth is we will likely be dealing with these challenges of social upheaval not just in Iraq and Syria, but across the Middle East in the wake of the Arab Spring, which will take a generation or more to work itself out. 

We can’t solve each of these problems alone.  We can’t solve them ourselves.  But ultimately — and we can’t ultimately solve them with force, nor should we try.  But we can work to resolve these conflicts.  We can seek to empower the forces of moderation and pluralism and inclusive economic growth.  We can work with our partners to delegitimize ISIL in the Islamic world, and their perverse ideology. 

We can cut off the flow of terrorist finance and foreign fighters, as the President chaired the hearing in the United Nations Security Council on that issue just last week.  We can build the capacity of our partners from the Arab world to Afghanistan to solve their security problems in their own countries with our help and guidance.  The threat posed by violent extremists is real.  And I want to say here on the campus of Harvard University:  Our response must be deadly serious, but we should keep this in perspective.  The United States today faces threats that require attention.  But we face no existential threat to our way of life or our security.  Let me say it again:  We face no existential threat — none — to our way of life or our ultimate security.

You are twice as likely to be struck by lightning as you around to be affected by a terrorist event in the United States.

And while we face an adaptive, resilient enemy, let’s never forget that they’re no match for an even more resilient and adaptive group of people, the American people, who are so much tougher, smarter, realistic and gutsy than their political leadership gives them credit for.

We didn’t crumble after 9/11.  We didn’t falter after the Boston Marathon.  But we’re America.  Americans will never, ever stand down.  We endure.  We overcome.  We own the finish line.  So do not take out of proportion this threat to us.  None of you are being taught to dive under your desks in drills dealing with the possibility of a nuclear attack.  And I argue with all of my colleagues, including in the administration, the American people have already factored in the possibility that there will be another Boston Marathon someday.  But it will not, cannot — has no possibility of breaking our will, our resolve, and/or our ultimate security.

Which brings me to the fifth and final point, the strength of America’s economy.  Without a strong economic foundation, none of which I have spoken to is possible — none of it.  It all rests on America remaining the most vibrant and vital economy in the world. 

And America is back.  America remains the world’s leading economy.  I got elected when I was 29 years old, as was pointed out, and I was referred to in those days as a young idealist.  And I’m today — if you read about me among the many things that are often said, good and bad, I’m always referred to as the White House Optimist, as if somehow, as my grandpop would say, I fell off the turnip truck yesterday.  (Laughter.)

I’m optimistic because I know the history of the journey of this country.  And I have never been more optimistic about America’s future than I am today, and that is not hyperbole.  We are better positioned than any other nation in the world to remain the leading economy in the world in the 21st century. 

We have the world’s greatest research university.  We have the greatest energy resources in the world.  We have the most flexible venture-capitalist system, the most productive workers in the world.  That’s an objective assertion.  We have a legal system that adjudicates claims fairly, protects intellectual property.  Don’t take my word for it.  AT Kearney has been doing a survey for over the last I believe 30-some years.  They survey the 500 largest industrial outfits in the world.  They ask the same question:  Where is the best place in the world to invest?  This year, America not only remains the best place in the world to invest by a margin larger than any time in the record of the survey, but Boston Consulting Group right here, a first-rate outfit, surveys every year American corporations with manufacturing facilities in China and asks them what are they planning for next year.  This year, the response was 54 percent of those invested in China said they planned on coming home.

I don’t know how long I’ve been hearing about how China — and I want China to succeed, it’s in our interest they succeed economically — about how China is eating America’s lunch.  Folks, China has overwhelming problems.  China not only has an energy problem, they have no water.  No, no, not a joke — like California.  They have no water.  (Laughter.)  It is a gigantic and multi-trillion-dollar problem for them.  We should help them solve the problem. 

Ladies and gentlemen, raise your hand if you think our main competition is going to come from the EU in the next decade.  Put your hands up.  (Laughter.)  I’m not being facetious here now, I’m being deadly earnest.  We want — it is overwhelmingly our interest that the EU grow, and that China grows, because when they don’t grow, we don’t grow as fast.  But, ladies and gentlemen, relative terms, we are so well-positioned if we act rationally, if we invest in our people.

A recent study points out that American workers are three times as productive as workers in China.  It matters in terms of where people will invest their money, where jobs will be created.  And one of my — I was in and out of Kosovo and Bosnia and Herzegovina over twenty-some times.  As Maggie will remember, I was the voice that kept hectoring President Clinton to lift the arms embargo and take on Milosevic, which he did, to his great credit.

And one of my trips to Kosovo, I had a Kosovar driver, meaning he was Muslim, a Kosovar driver and who spoke a little English.  And I was going up to Fort Bondsteel, which is right outside of Pristina, a fort that was being built on a plateau.  And it was a rutted, muddy road, and we were — the tires were spinning to get up there, but there were all these cranes and bulldozers and all these incredible movement.  And my driver very proudly sort of looked down like this and looked out the window and he pointed at me and he said, Senator, America, America.  And we were literally at a gate – and, Tommy, you know, the old pike that came down across this rutted road in red and white striped.  And standing to the right of the gate, stopping us, were five American soldiers.  An African American woman, who was a master sergeant; a Chinese American — I forget the rank; an African American man; a woman colonel, and a Hispanic commanding officer.  And I tapped him on the soldier and I said, no, no, and I meant it so seriously — there’s America.  There’s America.  Until you figure out how to live together like we do, you will never, never, never make it. 

America’s strength ultimately lies in its people.  There’s nothing special about being American — none of you can define for me what an American is.  Can’t define it based on religion, ethnicity, race, culture.  The uniqueness of America is that we are a group of people who agreed on — whether we say it, whether we’re well-educated or not, whether we say it in terms of basic agreements but we really do believe without saying it, “We the People.”   “All men are created equal, endowed by their Creator.”  Sounds corny.  But that’s who we are.  That’s the essential strength and vibrancy of this country.

And that’s why it’s our obligation to lead.  It’s costly.  It takes sacrifice.  And sometimes it’s dangerous.  But we must lead — but lead in a more rational way, as I hope I’ve outlined for you, because we can.  We can deal with the present crisis, and it is within our power to make a better world.

You’re a lucky group of students.  I’m not being solicitous.  You’re lucky because you are about to take control at a time where one of those rare inflection points in the history of the world, in this country.  Remember from your physics class in high school, if you didn’t have to take it in college.  I remember my physics professor saying an inflection point is when you’re riding down the highway at 60 miles an hour and your hands are on the steering wheel, and you turn it abruptly 2, 5, 10 degrees one way or the other, and you can never get back on the path you were on.
 
We are at an inflection point.  The world is changing whether we like it or not, but we have our hands on the wheel.  The only time you get a chance to bend history a little bit are these moments of great change.  And if we’re wise, if we have courage and resolve, and with a little bit of luck we can all make the world a better place — for real.
 
God bless you all and may God protect our troops.  Thank you.  (Applause.)  

END
7:20 P.M. EDT

Asia-Pacific Economic Cooperation

11:00 A.M. EDT

THE WASHINGTON FOREIGN PRESS CENTER, WASHINGTON, D.C.

MR. WANG: Thank you, and thanks for the moon cake. Just kidding. Anyway, I just came back, as you know, from SOM3 in Beijing where we spent a total of actually almost two weeks, including a lot of sort of working group level meetings. And then – so after SOM3 we, as you know, will have a whole series of ministerials leading up to the leaders meeting in November. And so in fact right now in Xiamen they’re doing the oceans ministerial. So it’s a meeting at the ministerial level on oceans issues, and then there will be about six or seven ministerials. I’ll be going back to China in – this weekend. So I’m not sure where I am actually right now. But I’ll be going back to Beijing, and then there’s a human resource development ministerial in Hanoi, in Vietnam. So I go there to that ministerial, and then to the Philippines.

As you know, the Philippines is the host next year for APEC. So they’re very, very eager to begin to prepare for next year’s agenda and how we can follow through from this year. So I’ll be going to the Philippines and meeting with my counterparts there. And then after that I’m going to go to Hong Kong and have some meetings there, and then go to Macao for the tourism ministerial. So that’s September 13th – and then come back. So I’ll be on the road for about two weeks.

And following that, I’ll probably stay in Washington as much as I can, because we start preparing for the actual leaders meeting, and so there will be a lot of demands in terms of – obviously, President Obama is definitely going. That’s what I understand. And we probably will have not just President Obama, but of course, Secretary Kerry, as well as USTR Mike Froman. But this year we may even have, I understand, possibly – well, clearly – Commerce Secretary Pritzker, possibly Agricultural Secretary Vilsack, as well, and maybe one or two other secretaries. So it’ll be a fairly big delegation from the United States going to Beijing in November. So a lot of preparation.

But in the run-up to that we also have a finance ministerial, we’ll have an agricultural ministerial – I think both in Beijing – and then I’m not sure if you know the actual leaders schedule, but it begins in Beijing on the fifth and the sixth, which is the senior officials (SOM) meeting – the fifth and the sixth. And then Secretary Kerry and Mike Froman will do their ministerials – APEC ministerials – on the seventh and the eighth, and then the President and other leaders will arrive on the 10th – and basically it’s the 10th and 11th in Beijing.

And then I think, as you all know, I think President Obama will be staying behind in Beijing for a day on the 12th, after which he heads out to Burma for the EAS – the East Asia Summit – and then he heads to Brisbane in Australia for the G20 – the 15th and the 16th.

So that’s the general schedule of the coming couple months. Of course, I’m involved primarily in APEC, not in the EAS or the G20. Now let me just make a couple of comments about the substance of APEC as we’re moving towards the leaders week. And then I’ll try to leave a lot of time for questions that you all have.

Now on the substance, I think at my last briefing we talked about essentially the agenda for the APEC year from the Chinese perspective, and you have basically three pillars. The one – the first pillar is the trade and investment pillar, and then the second one is what the Chinese call the innovation, reform, and growth pillar. But in general, those are the set of issues that are related to how we sustain economic growth in the region. So issues of the environment, issues of food security, heath security, women empowerment, internet, urbanization, all of those issues that are important in sustaining growth – so not just growing but sustaining it in a way that would allow it to grow, obviously, in a healthy fashion. And the third pillar, as you all know, is the connectivity pillar. Essentially, there we have a whole set of issues related to trying to increase the flow of people and goods throughout the APEC economy, so including cross-border education, physical infrastructure, regulatory convergence, things of that nature. So that’s the third pillar.

And I’m happy to say that SOM3 is usually the most important SOM meeting, the senior official meeting, because it’s the last one before the leaders actually meet. So we really have to get everything together to make sure that we don’t have a lot of problems during the leaders week. We don’t want to spend a lot of time arguing over things, debating things at the last meeting. So this meeting is very important. And the U.S. had about 200 delegation members go to the SOM3, and when I say delegation I mean it fairly loosely. We had about a hundred from the private sector going, and then a hundred from the different agencies within the U.S. Government going. So as you know, it’s not just the State Department. We have people from Homeland Security; people from Agriculture; people from Commerce, of course; USTR, Transportation; et cetera. So a lot of – Department of Justice, because this year we focused a lot on anti-corruption, so we had people from there attend as well. And so a very big meeting.

And I’m happy to say that this year I can honestly say we really made good progress at the SOM3 meeting with the Chinese host. Very well organized. We made progress across the three pillars that I just talked about.

On the first pillar, let me just say that, as you all know already, the Chinese are very focused on the – on, of course, the large FTAAP, the free trade area of the Asia-Pacific. And so we had good discussions on that, and hopefully by the time our leaders get together, we should be able to actually launch the roadmap for FTAAP for the free trade area. We will have, essentially, the roadmap that would include a lot of events that we’ll be doing – activities we’ll be doing that would include information-sharing, it would include capacity-building, it would include, finally, an analytical study of how we’re going to move towards a free trade area of the Asia-Pacific, what we call FTAAP for short.

So that’s something, of course, the Chinese are very much focused on launching this year in Beijing. And again, we had good discussions, and I think we will have a good launch in November. And we did a few – quite a few other things in this trade investment area, including beginning to look at services, access to services market in the region within APEC – for example, manufacturing-related services that the Japanese and Australians both proposed and we cosponsored.

So we’re essentially – the point is that we’re moving away from – not away from, but from sort of focusing on goods, the liberalizations on tariffs and so on, to the services market. And that’s what we call a global supply chain. And we’re also looking at moving into the environmental services area – trying to open access to environmental services in each of these markets where we can actually expand the flow of services in this area.

And so in that area – again, there’s a long list – as most of you know, APEC is a very broad, broad sort of body of issues that we deal with. So apart from that, in the sustainable growth area, I think I spoke to a number of local press people in Beijing. And I actually arrived fairly early in Beijing because there was a very high level workshop on anticorruption. And the U.S. and China are working very closely together in this area. And also, there was the first meeting of the anticorruption and transparency network, and the ambassador, Ambassador Baucus attended that one. The minister for supervision, by the way, attended the first one – the high level workshop on anticorruption. Huang Shuxian, the minister of supervision, opened the meeting itself, and it was a very good meeting.

Again, I learned a lot personally from that meeting, where a lot of private sector companies, people – law enforcement officials from different economies spoke. And at the first meeting of the ACT network – this is a network of law enforcement officials, essentially – first meeting of this group. And Ambassador Baucus, our ambassador in Beijing, delivered opening remarks at that, as well as a number of others. And the Vice Minister for Supervision Fu Kui was there as well throughout the meeting.

So it was a very useful meeting because the whole purpose of this ACT-NET is to get all of the law enforcement officials who are involved in anti-bribery in the APEC region together to try to begin a process of information sharing among the different economies on bribery cases that essentially cross the border within APEC, and to also share best practices on how we do things, so that we can tackle this issue more seriously and more effectively, and also, essentially, to bring them together to also find out what the various regulations are within each economy. For example, the U.S. has a different set of laws and regulations regarding bribery cases, and also asset recovery regulations. So this would be a good chance for law enforcement officials to know about the particular regulations and rules in different economies. So this is the first step towards that, and so we hope that this will bring in greater cooperation.

But beyond this issue, we also touched on a whole range of issues, as I mentioned earlier. The U.S., for example, is still very much – from the year we hosted in 2011 – very much focused on trying to increase women-empowerment in the economy. In other words, how do we provide greater opportunities for women to access finance markets and to also be more involved in the higher levels of management within different companies in different countries?

This was, of course, also not just a U.S. initiative, but also very much led by Japan because, as you know, Abe and women-omics, is very, very concerned about sort of the aging Japanese society and how you have to utilize more the talents that you have within Japan, within your society, and how to essentially elevate and expand the role of women, which means you have to deal with sort of family friendly practices within companies. So the Japanese, for example, have a proposal where they will – they’ve asked all of different APEC economies to nominate five companies from each economy that have best practices in terms of how they promote and facilitate the role of women in their companies by producing family friendly policies on health, on healthcare, and so on.

So we focused on that as well in SOM3. Again, we also had, essentially, health security issues that we focused on. China, as a host, sponsored two particular sessions that I attended as well, that all the senior officials attended, and the internet economy was one of them. So the idea now is all of our societies are changing so quickly and the role of the internet is clearly very, very significant, so we invited people from Alibaba, Baidu. From the U.S. we invited Uber. Do you know what Uber is? Yeah, it’s sort of taxi cabs – not quite taxi cab, but it’s a service. And I actually never knew what Uber is until this summer. But the Uber person came, and they actually have now Uber service in China. So if you have a problem in China, you can go onto this – I guess whatever you have, an app that you have for Uber, but they’re expanding quite a bit.

And so the point there is that they were trying to show how internet can be used to really – as an innovation – to actually do a lot of things. For example, a lot of small businesses that cannot afford big buildings and cannot compete with the CEOs from big companies, can actually use the internet to really quickly link, organize, do business. And so it could also be used to service a lot of the vulnerable groups within societies that they have access to the internet. So a very, very, very useful seminar workshop with discussion afterwards.

And the Chinese also hosted another one on urbanization in this area. China, as you know, and a lot of other countries continue to urbanize. And so we had presentations from Korea, from Japan, from China on different ways of urbanizing in an environmentally friendly fashion, and how important it is to conserve energy, to design – plan the city in a way that would be efficient and healthy for urbanized growth. On the U.S. part, I spoke a little bit about how in the U.S., we already are fairly urban, but how, for example, in New York City, when you go now to New York City, you can find that even the older cities, there are different ways that businesses have started and communities and neighborhoods have started to make it more vibrant by essentially doing pedestrians’ walks and then urging businesses to get together to sort of make more vibrant different neighborhoods within an old city. And so there are many ways of dealing with urbanization, but it’s now a very major issue for a lot of countries. And so we’re trying to share best practices, trying to find out how we can work together to help urbanization proceed in a healthy fashion there. So those are some areas and if you have questions about this area, we can talk about it more later on.

In the last pillar, on connectivity, we talked, of course, about a number of issues in terms of infrastructure, physical infrastructure development, the need for investment in physical infrastructure. But mostly we spent almost a few hours on what we called a connectivity blueprint. So the senior officials earlier in the year asked the APEC secretariat to produce a blueprint on connectivity. In other words, how do we plan to move ahead to connect the APEC economies more closely together in all of these different areas? And underneath the connectivity blueprint, we have another three pillars.

And the three pillars are: physical; and the second one’s regulatory convergence – we’re trying to get regulations more uniform and more coordinated; and then people-to-people, so cross-border education, tourism, travel, the ABTC card, the APEC business travel card, and so on. So we discussed the blueprint at length and we set targets wherein, let’s say by 2025 – we haven’t decided on the actual date yet, but we set targets where we are trying to, let’s say, double the number of people-flow among the APEC economies, or tourism, cross-border education, trying to increase the number of cross-border students studying in different economies. And so we hopefully will be able to complete the blueprint and as a way of moving forward in terms of connectivity and produce this for the leaders week in November.

And let me just add one last thing. One of our major initiatives – one of the United States, supported by eight other economies – is to actually create what we call an APEC scholarship and internship initiative. And by this what we mean is that we’re getting a number of economies to cosponsor scholarships for students; for example, students from the developing APEC economies to be able to study in another economy on a scholarship if they can’t afford it. So I think we had a very good response. This proposal was made earlier and at SOM2 we had a very good response. For example, Chinese Taipei, I believe, will come up with some 20, 25 or so scholarships, where they will provide scholarships for people to go to Taiwan to study. And I know that China also will have quite a number of scholarships that they will be proposing at the end of the year in November.

Australia – very, very positive. They not only are trying to invite people to go to Australia to study on scholarships, but they’re also trying to encourage Australians, young Australians to go abroad to other parts of Asia, to learn more of the culture, learn the educational system, and so on. And in the U.S. we’re proposing to have a number of companies offer internships that will allow and help students from various APEC economies to come to the United States or to go to some of the companies in the region to intern in, let’s say for example in our case, the APEC members – Caterpillar, Eli Lilly, Qualcomm – will be offering sort of internships or scholarships to encourage, again, more cross-border education.

So I think I’ve gone on enough. Is it 10-15 minutes or so already?

MODERATOR: Yeah, it’s about 20.

MR. WANG: Yeah. So what I’ll do now is just turn to you for questions, and I’ll be glad to answer – and she’ll – she said she’ll select who – I don’t get to pick. Thanks. (Laughter.)

MODERATOR: So just remember, again, wait for the microphones and say who you are and your outlet, please. We’ll start with you.

QUESTION: Thank you, Dr. Wang. Yun Zou with China Central TV, CCTV. Well, my question is that during the senior official meeting, both China and United States has expressed your willingness to work together in fighting the corruption, but we all know that by no means that will be an easy task, because, as you just said, that different countries has their own different interpretation of corruption and also has their own legal system. So I’m just curious that under this agreement, what kind of rules will all the countries abide by and who will mainly chair this agreement? Thank you.

MR. WANG: Okay. Well, first of all, in terms of the actual organization itself, it’s not so much trying to arrive at one rule, because we all know that we have very different political, legal systems. It’s really more to try to understand what each country’s rules and regulations are, so by understanding that – for example, if you – let’s say you had somebody cross a border. If somebody, let’s say, left China or left U.S. to go somewhere else with illegal funds, whatnot, then what you’d need to know – for example, the Chinese officials need to know is if you want to get somebody back to China or their illegally-obtained funds, you need to know what U.S. regulations are, what kind of evidence is needed to be able to actually get that person back or to recover the funds.

So it’s not an attempt to make everybody have one rule or law, because that’s going to be impossible. But it’s more to understand what the requirements are. So in fact, from this meeting that we had of the ACT Net, we produced, to begin with, a directory of all of the offices and the people in charge of the offices in the different economies. So, for example, if you have – if someone went to Malaysia and you have a case in Malaysia, then you can open up the book, essentially, and you know who the responsible offices are and the people are, then you can contact them to begin with. And then we also are producing a guidebook on the asset recovery process. So then this guidebook will have in it, for example, the process or procedures in the United States for recovering assets that are essentially stolen from another country and in the United States. So that’s the purpose of the ACT Network, and it’s not to really come up with one rule.

The other thing, of course, is to exchange best practices. So one of the major goals is to really have cross-border cooperation on assets or people that go cross-border, but also it’s really to learn about how you do it within your own country as well. So in our own country, how we deal with bribery and how you deal with it in other systems. So one of the important things we hope – again, it’s not done yet, but by the end of the year – we hope to have our leaders endorse a set of – and this is more like what you were saying – actually endorse a set of principles on anti-bribery that is very similar, for example, to the ones in OECD. So OECD has anti-bribery principles in terms of making sure that there’s a way of detecting and responding to sort of bribery cases.

So hopefully by the end of the year we will actually have – the U.S. actually drafted a sort of APEC principles on anti-bribery and enforcement of anti-bribery laws. And so we’re hoping that that will then be adopted by the different economies, and this will be one set that APEC economies will then be able to subscribe to and agree to. So you’re welcome.

MODERATOR: Yes, right up here.

QUESTION: Thank you, Dr. Wang, for holding this press conference. Ching-Yi Chang, Shanghai Media Group. I’d like to know, does President Obama expect to sign bilateral investment agreement with China during his trip to Beijing? And also, is there any change of the view of the United States on China’s market economy status, especially after China establishes its free trade zone? Thank you.

MR. WANG: Sure. I honestly don’t really follow that very closely, the BIT. Actually, it’s not a BIA, it’s a BIT – Bilateral Investment Treaty – if it’s between China and the United States. I do know that they’re having about three or four meetings a year, either in Beijing or in the U.S., on the Bilateral Investment Treaty. But I don’t know at what state it is at this point. But my guess is – just in terms of my interaction with my China desk counterparts and all that, and USTR – is that it won’t be at APEC. It’s still a couple years down the line, is my guess, so it won’t be that fast.

But again, I may be wrong. But I don’t expect that we are coming anywhere close this year to actually completing it. We’re exchanging negative lists, for example. There’s a list that the Chinese have that I know is very long from the U.S. perspective, and so we’re still negotiating that. And so it’ll take a while.

Now on the question of market status, again, I know of that more from my job when I was a deputy chief of mission in Beijing. And so I’ve been following that negotiation as well as the BIT. And that one, I believe, we’re still a long way off. But again, I would defer to perhaps others who are more current on this. But I think at this point, if it continues, I think the target date is 2016. So obviously, what China does in terms of its Shanghai pilot zone and so on would help, but I think we’re still a long way off from actually coming up with a change in the sort of market status for China.

MODERATOR: Okay. Yeah, right up here.

MR. WANG: You should give a badge to the people in the back as well.

MODERATOR: I will. (Laughter.)

MR. WANG: We’ve got three people in front.

MODERATOR: Yes.

QUESTION: Thank you very – thank you. Thank you very much, Dr. Wang. My name is Atsushi Okudera from Asahi Shimbun, the Japanese newspaper. I’d like to ask about U.S.-China bilateral relationship. This is not a direct – the APEC meeting, but are you planning to have a bilateral meeting, summit meeting, between President Xi Jinping and President Obama before or after the APEC meeting? And if you have, what kind of style? As you know, Chinese Councilor Yang Jiechi last year announced United States and China has agreed next time they going to have a same time of – same style of —

MR. WANG: Sunnyland.

QUESTION: Freestyle – like Sunnyland. So this time are you going to have same kind of – same style of summit meeting in Beijing or other cities? And if you have, what is the point of this time’s summit meeting, particularly in terms of new model of major power relations? They – both country talking about lots of times, but we still don’t understand. It is not very clear. I know this is for avoiding conflict —

MR. WANG: Right.

QUESTION: — or talking very freely, frankly. But actually, there is lots of differences on South China Sea and East China Sea and cyber problem. So what is the point this time? Thanks.

MR. WANG: Okay. Yeah, as I mentioned at the very beginning, after the leaders meeting is finished, the 10th and 11th, President Obama will stay behind in Beijing on the 12th, and so that’s where the bilateral meetings will be held between China and the United States. Some of the questions you’ve asked actually are probably best answered by the Chinese. We don’t know exactly what the Chinese have planned for the 12th in terms of how they want to do the bilateral at this stage, so I think that’s still in the process of discussion.

But obviously, I’ve heard a lot of comments about how effective it is to actually have smaller meetings where you can actually talk about issues in a more personal way, and I think knowing President Obama’s style and, of course, from the U.S. point of view, we did Sunnyland, and so we think that that’s an effective way of doing things. But – and of course, the Chinese seem to be receptive to that, but exactly what they have planned, we don’t really know at this stage whether it’ll be Beijing, whether it’ll be outside somewhere else. But that’s something I think that the Chinese are discussing with us, but not yet decided, I believe.

And in terms of the actual – the goal and the great – the major power relationship, again – actually, that’s a term that the Chinese came up with, not the U.S. So I’m not sure whether we subscribe completely to the exact interpretation of that. It’s something that Xi Jinping had sort of discussed several times, announced several times. That’s what he wants. But to me, it really – I’m not sure what new style model we have, but to me, it’s really simple.

And essentially, between any two countries – not just China and the United States – is first of all, you have to expand the areas of cooperation as much as you can, whether it’s on trade or whether it’s people-to-people, cultural, whatever it is. So you expand as much as you can the positive side of the relationship. That’s one thing. And the second point is then you manage the differences, because you will have differences, and some more than others, but between China and the United States, we certainly have differences that – some of the things you cited on cyber, on a number of other issues. But – so I would say you try to manage them in a way that would not make it uncontrollable or unmanageable, I guess. So that’s the bottom line.

So we have quite a number of issues between U.S. and China, and so far I think we’ve been able to manage them. So I think the relationship between U.S. and China will essentially be one in which we continue to – on human rights, on cyber or whatever else – we continue to have differences. We need to manage those. And then on the other side, within APEC for example but beyond APEC, we have a lot of, like, CPE, the sort of people-to-people exchange. We’ll continue to expand it as much as possible, and hopefully, the positive side will, in the long term, win out. So that’s what I see as the power relationship that we have.

MODERATOR: The gentleman right here.

QUESTION: Thank you, Dr. Wang. Wait, hello? Yeah. Thank you, Dr. Wang. Xiaoyang Xia, reporter from Wen Hui daily, Shanghai, China. You mentioned that China as a host has set out three pillars for this year’s APEC. The question is: Does the U.S. quite agree with those pillars or themes? And do you have any differences? And what are U.S. priorities for this APEC which you want mostly to achieve?

And secondly, you mentioned under the third pillar the main – one of the main focus is the infrastructure building, and what’s your opinion or what’s U.S. position on the Chinese proposal for the establishment of a Asia Infrastructure Investment Bank? Thank you.

MR. WANG: Yeah. We have no problems at all with the three pillars that the Chinese have proposed because they’re fairly broad, so how can you disagree with trade and investment, or how can you disagree with sustainable growth and how can you disagree with connectivity?

The question, then, of course, underneath them will be working on all of these different issues that are sort of different priorities – some for the Chinese, some for the Japanese, Koreans, Vietnamese, et cetera, and ours. So no disagreement; we’ve been working very well under those three pillars. In terms of U.S. priorities, I mentioned already at some length the question of anticorruption, and I think that’s a joint priority for the U.S. and for China because – and not only that, actually. This priority is actually quite broad, because if you look around the APEC region, whether it’s Philippines, Vietnam, Indonesia, Mexico, Peru, corruption is a big problem. It’s a pervasive problem in all these economies.

And so the question is: How do you continue to sustain growth without dealing with this issue? Because it essentially produces unfair sort of disparity of wealth and no rule of law, so in the long term, you really have to deal with it. That’s why it’s a very high priority for the United States, and I think also for China, clearly, and for the other economies. So that’s a very high priority.

We’re also very concerned – I think especially Secretary Kerry and President Obama – about the environment. And I think China, Vietnam, Indonesia, others are also because, for example, rapid growth in China over the last 20 or 30 years has produced an environment which is really quite hazardous to your health in terms of air, in terms of water, food security – food safety, I should say, not so much food security but food safety. So we all know that you can grow very quickly, but to sustain it and to actually make it healthy for your own people, you have to really focus on the environmental impact of what you’re doing.

So for example, right now, as mentioned earlier, oceans – we’re having an oceans ministerial right now in Xiamen in China. And so beyond air and beyond water and so on, we’re going into the oceans, where so much of the ocean now has marine debris. So people throw things overboard when they’re in ships, they throw them from the land, they dump it out there, and it’s destroying a lot of the oceans that we have. And again, for the moment, we don’t know that, but in the long term, we’re going to rely on the ocean – the big Pacific Ocean and others. So we hope that we’ll be able to get countries within APEC at this point to begin to work on protected marine areas to begin with, and then sustainable fisheries – not to overfish, not to do illegal fishing or unregulated fishing, because if you were to do over-excessive fishing, then essentially you’re going to be drying out the resources that you need in the future. So the environmental issues are very important, and one of our major U.S. initiatives apart from the oceans – as you know, we did an Oceans Conference here, Kerry did one, inviting global members here. So we’re trying to use some of that – the action plan – we table it at – in SOM3, this action plan from the Oceans Conference. And we’re hoping to use some of that now in the oceans ministerial in Xiamen to try to get APEC to support these various principles.

And beyond the environment, I mentioned already that women is a very high priority for us, because again, we think it’s not only the right thing to do to include women in inclusive growth, but it’s also good for the economy, for your development to be able to utilize all the talent that you have within your society. And so that’s a very high priority for us. So in concrete terms, what the U.S. has done in this area is we tabled, for example, a study that we have done on trying to come up with indicators for women participation in the economy as a whole. So in other words, for example, how many women – what percentage of women are in management positions, what percentage of women have access to finance, what percent of women essentially have access to markets.

So we’re trying to come up with an indicator – we already have done the study; we have come up with 26 indicators. And what we’re trying to do now is get the economies next year to begin to measure exactly where women are in terms of participation in the economy. And once you have that measure as a baseline, then we’ll begin to set targets and see where we’re failing – in other words, why are women so – have no access to finance in certain countries, let’s say, and try to work on improving that. And we’ll set targets and to move ahead.

So we’ve done this study, we hope that this will endorsed – the indicators will be endorsed by the leaders, and then we will then hopefully have the leaders encourage all the economies to begin measuring, and then from there move on to targets in the coming years. And —

QUESTION: (Off-mike.)

MR. WANG: Yeah. The last one, on infrastructure – there a lot more priorities. I have about a list of ten priorities more. But let me just go directly to the infrastructure issue. I think most of you are aware of the Chinese proposal on the Asian Infrastructure Investment Bank. And we have been in touch with China and met with Chinese leaders – Jin Liqun will be, of course, the head of that bank, we understand. We’ve had discussions on that. And there we’ve been very clear about what our concerns are. And our concerns are just that this proposal for this AIIB, that they’re able to meet the various standards of other multilateral development banks – meaning essentially, to begin with, the projects should take into consideration safeguards on the environment.

So when you start an infrastructure project, you have to make sure that you look at the environmental impact of that project, or labor, and what kind of labor you use, what conditions under which they work. That’s one thing. Governance, transparency – meaning that if you’re in construction you’re talking about large sums of money. How should it be dealt with in terms of transparency, governance so there’s no corruption? We go back to the issue of corruption. So our main concerns are that, and we’ve conveyed these concerns to China, and we hope that they can be addressed.

QUESTION: Thank you. Kunihiko Yasue from Yomiuri Shimbun.

MR. WANG: Yeah. Just a little softer, but yeah.

QUESTION: As for FTAAP, Trans-Pacific Partnership is a part of FTAAP. And as to Trans-Pacific Partnership —

MR. WANG: TPP.

QUESTION: — President Obama in July said he hopes to get something which is public and the Congress can look at by the time he visit Asia in November. So are there any possibility or a plan that the latest meeting for TPP negotiation will be held in the sideline of APEC latest meeting like last year?

MR. WANG: Okay. Let me first correct you on one thing. I don’t think that APEC – I don’t think that there were TPP negotiations per se on the sidelines of APEC. There were meetings, but there were not negotiations. In other words, APEC, heads of APEC in Bali when I was there last year, for example, the TPP leaders got together for sort of a short discussion, but it was not a negotiation. So that’s a very different thing. On the TPP issue, obviously the key player in the United States is USTR. So we’re not actually negotiating within APEC or involving negotiations on TPP within APEC, as you know.

And so I don’t really know exactly what status it’s in right now. Obviously, last year in Bali we were hoping it could be completed by around that time. And obviously, we’re working very hard this year and understand good progress has been made, especially after the various meetings in Japan on market access. But again, on the specifics of the negotiations, I’m not really privy to it so I don’t know how far along it is. All I know is that every time I turn around to talk to Wendy and others they’re off somewhere – or Mike Froman – they’re off somewhere negotiating it or talking somewhere.

So all I can say is I think we’re making progress, but I don’t know what will happen by the end of the year.

MODERATOR: I’d like to offer an opportunity to New York. New York, can you hear me?

QUESTION: Yeah. This is Shen with China Business Network and from New York. And it is good morning, Dr. Wang.

MR. WANG: Good morning.

QUESTION: And you said President Obama and President Xi Jinping will hold a meeting during APEC like one last year. And what will be the possible topics that interest to leaders? And will the issues about the South China Sea and the Ukraine (ph) will be brought to the meeting? Thank you.

MR. WANG: Okay. I’m not sure if I understood everything you said clearly. Well, President Obama did not go to Bali last year, so I don’t know. They didn’t meet in Bali. I’m not sure if that’s what you said earlier, but in any case that’s not important.

I think within APEC, as far as I know, in the APEC context we will not be dealing with some of the political issues you talked about. At the bilateral I think these topics will probably come up. So on the 12th, I guess whatever differences we have or issues we have between China and the United States probably will come up, it’s my guess, at the bilateral on the 12th. But within APEC it’s not certainly part of the topic.

I’m not sure if I got your question entirely. I wanted to give you another chance to say something. (Laughter.)

QUESTION: Okay. I just want to say whether this topic whether the issue is about South China Sea and Ukraine (ph) would be brought to a meeting, and what would be the possible topics that interest to leaders?

MR. WANG: Possible targets that are interested to leaders?

QUESTION: Topics.

MR. WANG: Topics. Well, again, you want to separate APEC from the bilateral, and on the bilateral between China and the United States I think we – I can’t say exactly what they will say because it’s something that they will have to determine later on, but my guess is – all of us can guess what the topics would be. I mean, obviously, all of the differences between China and the United States on various issues will be raised, all of the sort of cooperative areas will also be raised.

So I would not be surprised certainly, and I can’t speak for the President, but I would not be surprised if South China Sea came up in a discussion because it is clearly an issue that both countries are concerned about managing, and I think it’s an important issue not just for China and the United States, but it’s an important issue for a lot of other countries in the region. And as for the other topics, again, it’s a wide range of topics. I think we all are aware of some of the range of topics that could be discussed. Human rights could be an issue as well. Trade issues would be important as well. You know we have a lot of trade issues. Cyber could be part of the topic. So I think you probably know better than I do the list of all of the issues that clearly both countries are concerned about today.

MODERATOR: Okay, start here.

QUESTION: Good morning, Dr. Wang. I’m from China, China News Service. I want to go back to the anti-corruption issue. And just now you mentioned that the APEC economies are doing guidebooks, some kind of guidebook to the anti-corruption. And are they going to publish this year, or it will take some year to discuss about the final version of that?

MR. WANG: Right.

QUESTION: Yeah. It will take —

MR. WANG: Yeah.

QUESTION: And besides that, besides the trying to understand each other’s legal system, and what kind of cooperation are they going to do during this anti-corruption issue action, that you call it? Okay, thank you, sir.

MR. WANG: Well, I think on the issue of the publication, actually the United States already has the publication, so we have a template for it. We already have our offices and also we have our asset recovery guidebook. So what we’re trying to do, probably next year, is to have all the APEC economies do the same thing. So clearly, it will not be done by November, but it will be something that will be essentially directed by the leaders for us to do in the coming year. So that’s the agenda for – I think for next year.

And I forgot the second part.

QUESTION: What else are you going to –

MR. WANG: Oh, yes. Yeah, apart from – okay. Beyond that, I think the whole point is I remember very clearly from one of the presentations at the high-level workshop that I attended and how people were talking about sort of cooperation between the law enforcement officials of one country with another, and one of the most important elements of this cooperation is trust. So in other words, you have to have some trust between the law enforcement officials of one country and another when they begin to exchange information or when they begin to try to get cooperation on specific cases. If there is no trust – and of course, trust is based partially on personal sort of relationships in terms of respect for the other person’s knowledge and respect for the other person’s integrity, but also for the system.

So I think one of the most important things we hope to come out of this network is that you begin to then have people meet more frequently – not just on specific cases, but let’s say on training courses so they’ll have a training course. China will be setting up a – what it calls a secretariat for this ACT network. It’s a small group for 2014-2015 and then maybe it’ll move on to other areas. But the idea is to set up a secretariat that would be able to organize training workshops where all of the law enforcement officials will come together and maybe in some area in some country and work together on learning best practices, how you do things, how I do things, and in that process also develop personal relationships among the different law enforcement officials to begin to understand each other. And in that sense, I think that will help facilitate actual progress on cases that actually occur.

MODERATOR: Hiroaki, and then I’ll go to you. These are probably the last two questions, guys. Go ahead.

QUESTION: Thank you. Thank you, Dr. Wang, for doing this. My name is Wada. I’m with Japan’s Mainichi – I’m with Mainichi newspaper.

DR. WANG: Mainichi. Mm-hmm.

QUESTION: And my question is about maritime territorial disputes in the bilateral meeting between the United States and China. What is the willingness of the Obama Administration to take up this particular issue? And you also talk about managing differences between the United States and China.

MR. WANG: Between who?

QUESTION: But after what happened off Hainan Island the other day, the interception by the Chinese of the U.S. Navy aircraft, what is the sense inside the Administration about the difficulty of managing the difference? Is that sense of difficulty is increasing, or is there any change? Thank you. These are my questions.

MR. WANG: Okay. Well, I think, again, let me just start by saying that this is not in my area, it’s not in my zone, so I’m not really dealing with that. So I want to make that very, very clear so nobody will think that I am actually speaking with authority on this issue. But all I’ll say is that I expect that all of the issues you raise will probably be discussed simply because they’re important issues. The more important the issues are, the more challenging they are, the more likely they’ll be discussed between our leaders, because they’re the ones who have to deal with these very serious problems. So all I’ll say on that then is that with the recent incident over the intercepts, whatever different versions of it – Chinese and American – I think, clearly, it’s something that we need to discuss. So my guess is that it’s already being discussed and that it will continue to be discussed if – at some point by our leaders.

So is it increasingly more difficult? Yeah, and that’s why you need to discuss it.

MODERATOR: Okay. Weihua.

QUESTION: Hi, thank you. Chen Weihua, China Daily. Yeah, I want to go – continue on that ACT network. Will that lead to deterrence for those Chinese – corrupt Chinese officials to seek safe haven in the U.S., Canada, or Australia, or will that lead to extradition and repatriation of those corruption – corrupt officials already here? So thank you.

MR. WANG: Right. Well, I think the goal, certainly, is to – on both sides, not just China and the United States but on all sides, the goal, of course, is to increase the possibility or the probability that illegally obtained funds or criminals who go across the border will be returned and will be treated according to the rule of law in whichever country they come from. So the goal of the entire thing is to increase that probability, and to increase that probability then the presumption is that each side has to understand what the requirements are for doing this.

And so by starting on this first step to try to understand laws and regulations of different sides, the kinds of evidence that’s needed that’s considered to be relevant information or relevant evidence that could be useful in court, that that first step will increase the probability that in the future people who escape to another country with illegal funds will be returned eventually to their country. So that’s the goal of it. Now, how fast that happens, when that happens, is another issue, but that is the goal. And obviously, if the Chinese were to better understand what kinds of evidence is needed, and if they can provide that to us or to any other country, then obviously, the chances that they will be repatriated or be brought back would be higher.

MODERATOR: All right. Do you want to take one more?

MR. WANG: Sure, I’ll take one, yeah.

QUESTION: Matt Field with —

MODERATOR: Wait just one second.

QUESTION: I’m sorry. Matt Field with NHK, Japan Broadcasting Corporation. Just on the corruption efforts, can you just clarify how many countries were involved in these corruption meetings you attended? Were there bilateral meetings just between the U.S. and China? And so can you imagine a day when the U.S. would be helping China track down corrupt officials here in the U.S. and sending them back to China? Thank you very much.

MR. WANG: Sure. No, it wasn’t bilateral. I didn’t count exactly who was there, but I would imagine almost all 21 economies were involved. It was open, certainly, to all 21 economies. And again, the first day was a workshop, a high-level – well, there are three – actually, three days of meetings. The first day was a working group meeting of the anti-corruption and transparency working group. That’s one day.

The second day that I mentioned Minister Huang Shuxian went is the high-level workshop on anti-bribery. And not only were there 21 economies all invited – and many did go, because I was there – they were also on the panel people from Indonesia, people from Malaysia, other people who were speaking on that panel. And also there was private sector, so companies like Siemens and so on actually made presentations. And from the United States, the SEC, Securities and Exchange Commission, had people there. Department of Justice had people there. And so it was a 21-member APEC discussion on anti-corruption.

And – oh, whether or not I can see a day when the United States will actually work with China to bring Chinese criminals back to China, I’ll say that we already do. Again, I worked in China for many years, and we already have a lot of cases where – whether it’s from China, from Americans sent back to the United States or Chinese sent back to China in some cases – fewer of those, probably. But we’ve – not just in the criminal cases, but other cases – we have cooperated. There were some cases where we have actually sent people back to China when I was deputy chief of mission in Beijing.

The question then is: How many of them? Of course, the Chinese would like more, obviously, so we are cooperating already. The question is: How much more cooperation can we have? And there we require, again, a better understanding of what kind of evidence we need for this to happen. And if it’s provided to us, then we’ll continue to cooperate. We have something called the JLG, the Joint Liaison Group, that meets several times a year. And that’s where we are already bilaterally exchanging information about each other’s practices as well as information on specific cases. And we also have what we call ILEA program, where we actually bring a lot of law enforcement officials to Bangkok where we have a training center, and that has included some Chinese in the past for the last 10-20 years. So we are working together already on this issue.

MODERATOR: All right. Well —

MR. WANG: One last one?

MODERATOR: All right.

QUESTION: Thank you very much. Hello, okay? My name is Inoue from Kyodo News of Japan. I’m just wondering whether you had any chance to discuss about cyber issue with your Chinese counterparts, because Chinese Government has denied the U.S. allegation about the cyber theft and they refuse to have working group on cyber issue during the S&ED. So I’m just wondering where you are on this issue.

MR. WANG: Okay, good. The simple answer is that within APEC we did not discuss this. It was not an APEC topic. But as you know, they had an S&ED recently and that’s where they were discussed. Now, obviously, I understand that at the Strategic Security Dialogue that it wasn’t an official topic but the two sides discussed it, how can we deal with this issue. But I was not involved in the S&ED so I don’t know to what extent they discussed it, but I know the topic was certainly raised in that context.

QUESTION: (Off-mike.)

MR. WANG: Yes, we have not discussed this issue through APEC. It’s a bilateral issue so it’s not an issue with Indonesia-U.S., Papua New Guinea. They’re not interested in this issue. So yeah, but that’s a bilateral issue.

MODERATOR: All right. Thank you, everyone. We’ll call this briefing concluded.

MR. WANG: And thank you very much for coming. Appreciate it.

# # #

Secretary’s Remarks: U.S. Vision for Asia-Pacific Engagement

MR. MORRISON: Well, thank you. Aloha. I want to welcome everyone. And for our online audience, and also for the Secretary, I’d like to describe who is here in our audience. We have the mayor of Honolulu, Mayor Caldwell. We have our senator, Mazie Hirono. We have our former governor, George Ariyoshi, and our other former governor, John Waihee. We have many members of the business and intellectual and public affairs community here in Honolulu. We have members of the diplomatic corps. We have members of our men and women in uniform. We have the members of the board of governors of the East-West Center. We have the staff of the East-West Center. We have friends of the East-West Center. And most importantly, we have future leaders of the Asia Pacific region. And I was just telling the Secretary, I think yesterday we welcomed 130 new participants from the United States and 40 other countries. They’re here on a unique program to prepare them for being future regional and global leaders.

Now, how do you introduce a man who is so well-known for his own leadership and —

SECRETARY KERRY: First thing, you can just tell everybody to sit down.

MR. MORRISON: Oh. (Laughter.) Please sit down, yes. (Laughter.) Thank you, Mr. Secretary. Anyway, as you know, he has served in war and peace. He was a senator for 28 years; 59 million Americans voted for him for president, including 54 percent of the voters of Hawaii. (Laughter and applause.) But as a former senate staff person, I thought the way to really check him out was to see how his confirmation hearing went. Now, the issues were controversial but the nominee was not controversial, and what his former colleagues said about him, Republicans and Democrats, I think give the essence of the man: extremely well prepared, born in a Foreign Service family, served all 28 years on the Senate Foreign Relations Committee, four years as the chairman of that committee. He knows the languages – several foreign languages, countries, leaders, and issues. He is a man of incredible moral and intellectual integrity. He brings conviction and compassion to his job and great energy. He has been, I think, on his seventh trip to Asia, coming back and so we want to welcome him back to the United States. We want to welcome him to our most Asia Pacific state, and we want to welcome him to the East-West Center, an institution that’s building community with this vast region which is so systemically important to the future of the United States.

Mr. Secretary of State. (Applause.)

SECRETARY KERRY: Thank you. Well, good afternoon, everybody. Aloha. It’s wonderful to be here in Hawaii, and man, I can’t tell you how I wish I was as relaxed as some of you in your beautiful shirts. (Laughter.) Here I am in my – whatever you call it – uniform. Uniform, some would say. But it is such a pleasure to be here. Mr. Mayor, it’s great to be here with you. And Mazie, thank you. It’s wonderful to see you, Senator. I’m very happy to see you. Thanks for being here. And governors, thank you for being here very much.

Ladies and gentlemen, distinguished guests all, it’s a great, great pleasure for me to be able to be here. And President Morrison, thank you very much for that generous introduction. I appreciate it very much.

Charles was way ahead of the curve, folks, in seeing the trend towards regionalism in the Asia Pacific in the early 1990s. And he was calling for community-building within East Asia well before it became a standard topic of discussion on the think tank circuit. So clearly, and to everyone’s benefit, he’s had an ability to focus on the long game. And that is a talent that he actually shares with one of the founding fathers of this institution, a former colleague, beloved to all of you, who became a great friend to me, and that’s Senator Dan Inouye. During my sort of latter years, I actually moved up to about seventh in seniority or something in the United States Senate, and had I not been appointed to this job, with all of the retirements that are taking place, I don’t know, I might have been third or fourth or something, which is kind of intimidating. But as a result of that, I got to sit beside the great Dan Inouye for four or five years in the Senate. Our desks were beside each other, and we became very good friends. He was one of the early supporters of mine when I decided to run for President in ’04, ’03. But most importantly, Dan Inouye, as all of you know, was a patriot above all who commanded remarkable respect and affection of all of his colleagues. And Hawaii was so wise to keep him in office for so many years.

Having just visited yesterday Guadalcanal, having stood up on what was called Bloody Ridge, Edson’s Ridge, and walked into one of the still remaining bunkers that Marines were dug in on against 3,000-plus Japanese who kept coming at them wave after wave in the evening, it’s – it was a remarkable sense of the battle that turned the war. And no place knows the meaning of all of that better than here in Hawaii.

Yesterday commemorated really one of the great battles of the Second World War, and so it gave me a chance to reflect with special pride and with humility about Dan’s service to our country. He was a hero in the war, against difficult circumstances which we all understand too well. But he became the first Japanese American to serve in the House of Representatives and the United States Senate, against all the odds of what was still a prevailing sense in our country of misunderstanding between people. And he just never let that get in the way. He shared a very personal commitment to strengthening ties between the United States and the Asia Pacific. And that’s why he championed the East-West Center for decades, and I want you to know that President Obama and I strongly support your mission of bringing people together to think creatively about the future of our role in the region and how we overcome the kinds of inherent, visceral differences that sometimes are allowed to get in the way of relationships, and frankly, in the way of common sense.

We remember too well in America that slavery was written into our Constitution long before it was written out of it. And we all know the struggle that it took – excuse me – to write it out. So as we look at the world today – complicated, difficult, tumultuous, volatile – for so many of us who have spent decades working on issues central to the Asia Pacific, there’s actually something particularly exciting about this moment. It’s almost exhilarating when you look at Asia’s transformation. And like Dan Inouye, I have had the privilege, as many of you have here I can see, you’ve lived a lot of that transformation firsthand.

A number of my – (coughing) – excuse me, it’s the virtue of many hours in an airplane. A number of my ancestors from Boston and from Massachusetts were merchants whose ships dropped anchor in Hong Kong as they plied the lonely trade routes to China. My grandfather, actually, was born in Shanghai and was a businessman who had a partnership with a Chinese businessman. So in our family and in Massachusetts, we’ve had a long sense of the possibilities and of this relationship. Today, East Asia is one of the largest, fastest growing, most dynamic regions in the entire world. And when the Trans-Pacific Partnership negotiations are complete, about 40 percent of global GDP will be linked by a high-standard trade agreement, a trade agreement that creates a race to the top, not a race to the bottom, where people understand the rules of engagement and there’s accountability and transparency, and business and capital know exactly what the rules of the road will be so they’re attracted to invest each in each other’s countries.

After college, I had the privilege of serving in the United States Navy. And I went through Pearl Harbor. I had a remarkable several days here as a young officer on a frigate before we set sail to cross the Pacific. And I drove all over the island everywhere, in places I probably wasn’t supposed to. But I loved it and then spent a second tour in the rivers of Vietnam. And back then, the word Vietnam – just saying Vietnam – carried with it an ominous meaning. It meant war. It meant huge dissent in America, families torn apart. But today, Vietnam, when you say it, has a whole different meaning to most people. It’s now a dynamic country filled with economic opportunity. It’s a market for our businesses and our investors. It’s a classroom for our children. It has one of the largest Fulbright programs in the world. And it’s a partner in tackling regional economic and security challenges.

Such extraordinary transformations have actually become almost the norm in this region. I’ll never forget, 15 years ago, I visited in then Burma – no confusion with Myanmar but now people choose what they want to call it. But I visited with Daw Aung Sung Sui Kyi in the very home in which she was imprisoned for nearly two decades. And this week, I had the privilege of again going back to the very same house – it hadn’t changed, looked the same. She, by the way, 20 years later looks the same. And she is now free to speak her mind as a member of parliament.

It’s remarkable. It doesn’t mean all the president are solved. But these transformations are just some of what makes Asia the most exciting and promising places on the planet.

I am returning, as President Morrison has said, from actually my sixth trip to the Asia Pacific in 18 months as Secretary of State. And later today, I’ll be meeting with our outstanding Commander of United States Forces in the Pacific to review a range of America’s formidable military presence issues. I have returned again and again to this region – I can’t tell you how many times I went, Mazie, as a senator to the region. And we are now – we take our enduring interests there, obviously, very, very seriously.

We know that America’s security and prosperity are closely and increasingly linked to the Asia Pacific. And that’s why President Obama began what is known as the rebalance to Asia in 2009. That’s why he’s asked me to redouble my own efforts in the region over the next two and half years. And that’s why I want to talk to you today about four specific opportunities: creating sustainable economic growth, powering a clean energy revolution, promoting regional cooperation, and empowering people.

Now, these important opportunities can and should be realized through a rules-based regional order, a stable regional order on common rules and norms of behavior that are reinforced by institutions. And that’s what holds the greatest potential for all of us for making progress. We support this approach, frankly, because it encourages cooperative behavior. It fosters regional integration. It ensures that all countries, big and small – and the small part is really important – that they have a say in how we work together on shared challenges. I want you to know that the United States is deeply committed to realizing this vision. President Obama is excited about it. He wants us all to be committed to fostering it and also to understanding why we’re doing it. And frankly, it is this vision that is the underlying reason that so many countries in Asia choose to work with the United States.

You hear some people today talking about the United States retrenching or disengaging. Nothing could be further from the truth. I think we’re more engaged and more active in more countries and more parts of the world than any time in American history. And I can tell you that because just driving over here I was on the phone to people in the Middle East, talking about a ceasefire which is now going to be in place in the next days; talking about the road ahead. Just came back from Afghanistan, where we’re working on the transition to the people of Afghanistan, to their future. We’re engaged with Iran, working on the nuclear program; with the DPRK, with China, and Sudan, and Central Africa. We just had 50-plus African leaders to Washington to talk about the future of American engagement there. We are deeply engaged in a very, very complex world.

But this speech and this moment here at the university and at the center, and the trip that I just made to Asia, are meant to underscore that even as we focus on those crises that I’ve just listed and on conflicts that dominate the headlines on a daily basis and demand our leadership – even as we do that, we will never forget the long-term strategic imperatives for American interests. As Secretary of State, my job isn’t just to respond to crises. It’s also about defining and seizing the long-term opportunities for the United States. And having just traveled to Burma, Australia, and the Solomon Islands, I can tell you that nowhere are those strategic opportunities clearer or more compelling than in the Asia Pacific.

That’s why we are currently negotiating a comprehensive and ambitious Trans-Pacific Partnership Agreement that will create thousands of new jobs here in America as well as in other countries, and it will spur this race to the top, not to the bottom. It raises the standards by which we do business. That’s why we’re elevating our engagement in multilateral institutions, from the ASEAN Regional Forum to the East Asia Summit. And that’s why we are revitalizing our security partnerships with our treaty allies: Japan, Australia, South Korea, and the Philippines. And that’s why we are standing up for the human rights and the fundamental freedoms that people in Asia cherish as much as any people in the world.

I have no illusions about the challenges, and nor does President Obama. They are complex in this 21st century, in many ways far more complex than the bipolar, East-West, Soviet Union-versus-West world – the Cold War that many of us grew up in. This is far more complicated. It’s far more, in many ways, like 19th century and 18th century diplomacy, with states asserting their interests in different ways and with more economic players in the planet than we had in the 20th century with power and with a sense of independence. But what I want to emphasize to you all today is there is a way forward. This is not so daunting that it’s indescribable as to what we can do.

So how do we make our shared vision a reality for the region and ensure that Asia contributes to global peace and prosperity? First, we need to turn today’s economic nationalism and fragmentation into tomorrow’s sustainable growth. I say it all the time: Foreign Policy is economic policy, and economic policy is foreign policy. They are one and the same. There’s no denying that particularly in Asia Pacific. Asia Pacific is an engine of global economic growth, but we can’t take that growth for granted.

Because what we face something that is really a common challenge. Across the world, we have seen a staggering growth in youth populations. At the Africa summit it was just underscored to us there are 700 million people under the age of 30. We’ve seen staggering growth in these youth populations. And guess what. In the 21st century, in 2014 when everybody’s running around with a mobile device and everybody’s in touch with everybody every day all the time, all of these people are demanding an opportunity. They’re demanding dignity. And juxtaposed to their hopes, a cadre of extremists, of resisters, of naysayers are waiting to seduce many of those young people into accepting a dead end. And let me tell you, when people don’t have a job, when they can’t get an education, when they can’t aspire to a better future for themselves and for their families, when their voices are silenced by draconian laws or violence and oppression, we have all witnessed the instability that follows.

Now happily, many, if not most governments, in Asia are working to present booming youth populations with an alternative, with a quality education, with skills for the modern world, with jobs that allow them to build a life and a confidence in their countries. That is part of the reason why the young people in Asia are joining the ranks of the middle class, not the ranks of violent extremists. And the fact is that too many countries around the world are struggling to provide those opportunities. There’s a lack of governance, and we ignore the importance of this collective challenge to address the question of failed and failing states in other parts of the world.

In the 21st century, a nation’s interests and the well-being of its people are advanced not just by troops or diplomats, but they’re advanced by entrepreneurs, by chief executives of companies, by the businesses that are good corporate citizens, by the workers that they employ, by the students that they train, and the shared prosperity that they create. That is why we are working with partners across the Asia Pacific to maintain and raise standards as we expand trade and investment by pursuing a comprehensive Trans-Pacific Partnership agreement.

Now, the TPP represents really an exciting new chapter in the long history of America’s mutually beneficial trade partnerships with the countries of the Asia Pacific. It is a state-of-the-art, 21st century trade agreement, and it is consistent not just with our shared economic interests, but also with our shared values. It’s about generating growth for our economies and jobs for our people by unleashing a wave of trade, investment, and entrepreneurship. It’s about standing up for our workers, or protecting the environment, and promoting innovation. And it’s about reaching for high standards to guide the growth of this dynamic regional economy. And all of that is just plain good for businesses, it’s good for workers, it’s good for our economies. And that’s why we must get this done.

Now, every time I travel to Asia, I have the privilege of meeting with young entrepreneurs and business leaders. In fact, at the Africa summit the other day we had this wonderful group of young African leaders – all entrepreneurs, all these young kids in their 20s doing extraordinary things. It’s call the Young African Leaders Initiative, which President Obama started.

In Hanoi last December, I launched the Governance for Inclusive Growth Program to support Vietnam’s transition to a market-based economy. I’ve met with entrepreneurs in Seoul and Manila to talk about how we can drive innovation. On Saturday, I discussed with my ASEAN counterparts the framework for creating business opportunities and jobs that we call Expanded Economic Engagement, or E3. And just yesterday, I met with business leaders in Sydney, Australia to explore ways to reduce the barriers to trade and investment.

To broaden the base of support for this strategy, we need to focus not only on rapid growth, but we also need to focus on sustainability. And that means making the best use of regional institutions. President Obama will join APEC economic leaders in Beijing this fall to focus on promoting clean and renewable fuels and supporting small businesses and women’s participation in the economy and expanding educational exchanges. And just a few days ago, I met with ministers from the Lower Mekong Initiative countries to deepen our partnership and help them wrestle with the challenges of food and water and energy security on the Mekong River.

Ultimately, the true measure of our success will not be just whether our economies continue to grow, but how they continue to grow. And that brings me to our second challenge: We need to turn today’s climate crisis into tomorrow’s clean energy revolution. Now, all of this – all of us in this room understand climate change is not a crisis of the future. Climate change is here now. It’s happening, happening all over the world. It’s not a challenge that’s somehow remote and that people can’t grab onto.

But here’s the key: It’s happening at a rate that should be alarming to all of us because everything the scientists predicted – and I’ll tell you a little addendum. Al Gore – I had the privilege of working with Al Gore and Tim Worth and a group of senators – Jack Heinz – back in the 1980s when we held the first hearing on climate change in 1988. That’s when Jim Hansen from NASA came forward and said it’s happening. It’s happening now in 1988. In 1992 we had a forum down in Brazil, Rio, the Earth Summit. George Herbert Walker Bush participated. We came up with a voluntary framework to deal with climate change, but voluntary didn’t work. And for 20 years nothing much happened. Then we went to Kyoto. We went to all these places to try to do something, and here we are in 2014 with a chance next year in 2015 to do it.

And what’s happening is the science is screaming at us. Ask any kid in school. They understand what a greenhouse is, how it works, why we call it the greenhouse effect. They get it. And here’s what – if you accept the science, if you accept that the science is causing climate to change, you have to heed what those same scientists are telling us about how you prevent the inevitable consequences and impacts. You can’t – that’s why President Obama has made climate change a top priority. He’s doing by executive authority what we’re not able to get the Congress to do. And we’re working very hard to implement the Climate Action Plan and lead by example. We’re doubling the fuel efficiency of cars and trucks on America’s roads. We’ve developed new standards that ensure that existing power plants are as clean as possible and as efficient as possible. And we’re committed to reducing greenhouse gases and emissions in the range of about 17 percent below 2005 levels by 2020.

So we’re heading in the right direction. But make no mistake about it: Our response has to be all hands on deck. By definition, rescuing the planet’s climate is a global challenge that requires a global solution. And nowhere is all of this more evident than in the Asia Pacific. And no two nations can have a greater impact or influence on this debate or this challenge than China and the United States.

During the Strategic and Economic Dialogue last month, Secretary of Treasury Jack Lew and I were in Beijing for two days. And we and China together sent a clear message: The world’s two largest greenhouse gas emitters, the United States and China, are committed to advancing a low-carbon economic growth pattern and significantly reduce our countries’ greenhouse gases. And we’re working together to launch demonstration projects on carbon capture, utilization, and storage. We’re adopting stronger fuel efficiency standards for heavy- and light-duty vehicles. We’re advancing a new initiative on climate change and forests, because we know that the threat of deforestation and its implications of a changing climate are real and they’re grave and they’re growing. And I’ll just say to you this is not an issue on which you can be half pregnant. No such issue. If you accept the science, you have to accept that you have to do these things about it.

Now, the United States and China have a special role to play in reducing emissions and developing a clean energy future. But everybody – every nation – has a stake in getting it right. I just came from the Solomon Islands yesterday, a thousand islands, some of which could be wiped out if we don’t make the right choices. The Pacific Islands across the entire Pacific are vulnerable to climate change. And just yesterday, I saw with my own eyes what sea level rise would do to parts of it: It would be devastating – entire habitats destroyed, entire populations displaced from their homes, in some cases entire cultures wiped out. They just had flash flooding in Guadalcanal – unprecedented amounts of rainfall. And that’s what’s happened with climate change – unprecedented storms, unprecedented typhoons, unprecedented hurricanes, unprecedented droughts, unprecedented fires, major damage, billions and billions of dollars of damage being done that we’re paying for instead of investing those billions of dollars in avoiding this in the first place.

That’s why we are deepening our partnerships with the Pacific Island nations and others to meet immediate threats and long-term development challenges. And we’re working through USAID and other multilateral institutions to increase the resilience of communities. And we’re elevating our engagement through the Pacific Islands Forum. And we’ve signed maritime boundaries, new maritime boundaries with Kiribati and the Federated States of Micronesia in order to promote good governance of the Pacific Ocean and peaceful relations among island nations. And we’re also working on a Pacific Pathway of marine protected areas that includes President Obama’s commitment to explore a protected area of more than a million square miles in size in the U.S. remote Pacific.

We just held a conference on the oceans in Washington the other day with nations all over the world came to it – unbelievably productive. We produced $1.8 billion of commitments to help with fisheries enforcement, anti-pollution, dealing with acidification, and to protect these areas as marine sanctuaries.

The good news is in the end – and this really – it really is good news. Sometimes you have an issue – Mr. Mayor, I know you know this. Governors, you know this. You’re looking at an issue and, man, you scratch your head and you’re not quite sure what the solution is, right? And you work through it. Well, the good news is the biggest challenge of all that we face right now, which is climate change in terms of international global effect, is an opportunity. It’s actually an extraordinary opportunity because it’s not a problem without a solution. The solution to climate change is simple. It’s called energy policy. Energy policy. Make the right choices about how you produce your energy – without emissions, without coal-fired power plants that don’t have carbon capture and storage or aren’t burning clean – then you can begin to produce clean energy.

And the new energy market that we’re looking at is the biggest market the world has ever seen. Think about that for a moment. The wealth that was generated in the 1990s – I don’t know if you know this, but most people think that America got the richest during the 1920s when you had the so-called, even in the late 1800s, robber baron years, and then you had the great names of wealth – Carnegie, Mellon, Frick, Rockefeller, and so forth. And no income tax – wow, gonna make a lot of money.

Guess what. America made more wealth and more money for more people in the 1990s than at any other time in our history. And what it came from, the wealth that was generated then, was the high-tech computer revolution of the 1990s, and guess what. It came from a $1 trillion market with 1 billion users, 1 for 1. The energy market that we’re looking at in the world today is six times bigger, by far more important. It’s a $6 trillion market today with 4 to 5 billion users today, and it will go up to 7 to 9 billion users in the next 30 years. The fastest segment by far of growth in that market is clean energy.

We need to build a grid in America. We need to – we could use solar thermal to produce heat in Massachusetts, in Minnesota, take wind power from our states, sell it somewhere else. We can’t even do that because we don’t have that grid in place.

So I want to emphasize to all of you: We’re not going to find a sustainable energy mix in the 19th century or 20th century solutions. Those are the problems. We need a formula for 21st century that will sustainably power us into the 22nd century. And I believe that, working together, the United States and countries across the Asia Pacific can make this leap. That’s an exciting opportunity and that’s what we’re working on with China today.

The bottom line is we don’t have time to waste. If we’re going to power a clean energy revolution, we have to work together to dampen security competition and rivalry in the Asia Pacific and focus on these other constructive efforts. And so our third challenge is clear: We need to turn maritime conflicts into regional cooperation.

All of us in this room understand that these disputes in the South China Sea and elsewhere, they’re really about more than claims to islands and reefs and rocks and the economic interests that flow from them. They’re about whether might makes right or whether global rules and norms and rule of law and international law will prevail. I want to be absolutely clear: The United States of America takes no position on questions of sovereignty in the South and East China Sea, but we do care about how those questions are resolved. We care about behavior. We firmly oppose the use of intimidation and coercion or force to assert a territorial claim by anyone in the region. And we firmly oppose any suggestion that freedom of navigation and overflight and other lawful uses of the sea and airspace are privileges granted by a big state to a small one. All claimants must work together to solve the claims through peaceful means, big or small. And these principles bind all nations equally, and all nations have a responsibility to uphold them.

Now, I just participated in the ASEAN Regional Forum, and we were encouraged there to – we encouraged the claimants there to defuse these tensions and to create the political space for resolution. We urged the claimants to voluntarily freeze steps that threatened to escalate the disputes and to cause instability. And frankly, I think that’s common sense and I suspect you share that. I’m pleased to say that ASEAN agreed that the time has come to seek consensus on what some of those actions to be avoided might be, based on the commitments that they’ve already made in the 2002 Declaration on Conduct.

Now, we cannot impose solutions on the claimants in the region, and we’re not seeking to do that. But the recent settlement between Indonesia and the Philippines is an example of how these disputes could be resolved through good-faith negotiations. Japan and Taiwan, likewise, showed last year that it’s possible to promote regional stability despite conflicting claims. And we support the Philippines’ taking steps to resolve its maritime dispute with China peacefully, including through the right to pursue arbitration under the UN Convention on the Law of the Sea. And while we already live by its principles, the United States needs to finish the job and pass that Treaty once and for all.

Now, one thing that I know will contribute to maintaining regional peace and stability is a constructive relationship between the United States and China. President Obama has made it clear that the United States welcomes the rise of a peaceful, prosperous, and stable China – one that plays a responsible role in Asia and the world and supports rules and norms on economic and security issues. The President has been clear, as have I, that we are committed to avoiding the trap of strategic rivalry and intent on forging a relationship in which we can broaden our cooperation on common interests and constructively manage our differences and disagreements.

But make no mistake: This constructive relationship, this “new model” relationship of great powers, is not going to happen simply by talking about it. It’s not going to happen by engaging in a slogan or pursuing a sphere of influence. It will be defined by more and better cooperation on shared challenges. And it will be defined by a mutual embrace of the rules, the norms, and institutions that have served both of our nations and the region so well. I am very pleased that China and the United States are cooperating effectively on the Iran nuclear talks and we’ve increased our dialogue on the DPRK. We’re also cooperating significantly on climate change possibilities, counter-piracy operations, and South Sudan.

So we are busy trying to define a great power relationship by the places where we can find mutual agreement and cooperation. We’ve seen the benefits of partnerships based on common values and common approaches to regional and global security. Secretary of Defense Chuck Hagel and I met with our Australian counterparts in Sydney earlier this week and we reviewed the U.S.-Australian alliance from all sides. And though we live in very different hemispheres, obviously, and at opposite ends of the globe, the United States and Australia are today as close as nations can get. Our time-honored alliance has helped both of our countries to achieve important goals: standing with the people of Ukraine, supporting long-term progress in Afghanistan, promoting shared prosperity in the Asia Pacific, and collaborating on the United Nations Security Council. And we also agreed to expand our trilateral cooperation with Japan, and that will allow us to further modernize the U.S.-Japan alliance as we address a broader array of security challenges. Similarly, with our ally South Korea, our partnership on a growing range of regional and global challenges has brought much greater security to Asia and beyond.

History shows us that countries whose policies respect and reflect universal human rights and fundamental freedoms are likely to be peaceful and prosperous, far more effective at tapping the talents of their people, and far better partners in the long term.

That is why our fourth and final challenge is so important: We need to turn human rights problems into opportunities for human empowerment. Across the region, there are bright spots. But we also see backsliding, such as the setback to democracy in Thailand.

We all know that some countries in the region hold different views on democratic governance and the protection of human rights. But though we may sometimes disagree on these issues with the governments, I don’t think we have any fundamental disagreement with their people.

Given a choice, I don’t think too many young people in China would choose to have less access to uncensored information, rather than more. I don’t think too many people in Vietnam would say: “I’d rather not be allowed to organize and speak out for better working conditions or a healthy environment.” And I can’t imagine that anyone in Asia would watch more than a 130 million people go to the polls in Indonesia to choose a president after a healthy, vigorous, and peaceful debate and then say: “I don’t want that right for myself.” I also think most people would agree that freedom of speech and the press is essential to checking corruption, and it is essential that rule of law is needed to protect innovation and to enable businesses to thrive. That’s why support for these values is both universal and pragmatic.

I visited Indonesia in February, and I saw the promise of a democratic future. The world’s third largest democracy sets a terrific example for the world. And the United States is deeply committed to our comprehensive partnership. Indonesia is not just an expression of different cultures and languages and faiths. By deepening its democracy, and preserving its traditions of tolerance, it can be a model for how Asian values and democratic principles inform and strengthen one another.

In Thailand, a close friend and ally, we’re very disturbed by the setback to democracy and we hope it is a temporary bump in the road. We call on the Thai authorities to lift restrictions on political activity and speech, to return – to restore civilian rule, and return quickly to democracy through free and fair elections.

In Burma last week, I saw firsthand the initial progress the people and the government have made. And I’m proud of the role – and you should be too – that the United States has played for a quarter of a century in encouraging that progress.

But Burma still has a long way to go, and those leading its democratic transformation are only now addressing the deepest challenges: Defining a new role for the military; reforming the constitution and supporting free and fair elections; ending a decades-long civil war; and guaranteeing in law the human rights that Burma’s people have been promised in name. All of this while trying to attract more investment, combating corruption, protecting the country’s forests and other resources. These are the great tests of Burma’s transition. And we intend to try to help, but in the end the leadership will have to make the critical choices.

The United States is going to do everything we can to help the reformers in Burma, especially by supporting nationwide elections next year. And we will keep urging the government – as I did last week – to take steps to ease the humanitarian crisis in Rakhine state, and push back against hate speech and religious violence, implement constitutional reform, and protect freedom of assembly and expression. The government owes it to the people of those – of that movement to do those things.

And so, my friends, in the great tradition of our country, we will continue to promote human rights and democracy in Asia, without arrogance but also without apology.

Elsewhere in Asia, North Korea’s proliferation activities pose a very serious threat to the United States, the region, and the world. And we are taking steps to deter and defend against North Korea’s pursuit of a nuclear-armed ballistic missile capability. But make no mistake: We are also speaking out about the horrific human rights situation. We strongly supported the extraordinary United Nations investigation this year that revealed the utter, grotesque cruelty of North Korea’s system of labor camps and executions. Such deprivation of human dignity just has no place in the 21st century. North Korea’s gulags should be shut down – not tomorrow, not next week, but now. And we will continue to speak out on this topic.

So you’ve heard me for longer than you might have wanted to – (laughter) – describing a pretty ambitious agenda. And you’re right; it’s a big deal. We are super engaged. We are ambitious for this process: completing the TPP negotiations, creating sustainable growth, powering a clean energy revolution, managing regional rivalries by promoting cooperation, and empowering people from all walks of life – that’s how we’re going to realize the promise of the Asia Pacific. And this is a region whose countries can and should come together, because there is much more that unites us than divides us. This is a region that can and should meet danger and difficulty with courage and collaboration. And we are determined to deliver on the strategic and historic opportunities that we can create together.

That’s why, together with our Asian partners, we’re developing modern rules for a changing world – rules that help economies grow strong and fair and just, with protections for the environment, safeguards for the people who have both too often been left behind.

That’s why we’re building a region where Asia’s major cities are no longer clouded with smog and smoke, and where people can depend on safe food and water, and clean oceans, clean air, and shared resources from its rivers and its oceans, and with a sense of responsibility one generation passes on to the next to preserve all of that for the future.

That’s why we’re building a region where countries peacefully resolve their differences over islands, reefs, rocks by finding the common ground on the basis of international law.

And that’s why we’re building a region that protects the universal human rights and fundamental freedoms that make all nations stronger.

There is still a long road ahead. But nothing gives me more hope in the next miles of the journey than the courage of those who have reached a different and more hopeful kind of future. And that is the story that I want to leave you with today.

When I became a senator, getting increasingly more and more involved in the region as a young member of the committee and then later as Chairman of the Subcommittee on Asian and Pacific Affairs, the first trip I took in 1986 was to the Philippines. Strongman Ferdinand Marcos had called a sham “snap” election to fake everybody to prove how in charge he was, to preserve his grasp on power. President Reagan asked Senator Richard Lugar and me to be part of a delegation to observe those elections.

And I will never forget arriving in Manila and seeing this unbelievable flood of people in the streets all decked out in their canary yellow shirts and banners of pro-democracy protest. Some of us knew at that time there were allegations of fraud. I was sent down initially to Mindanao to observe the morning votes and then came back to Manila, and was sitting in the hotel there when a woman came up to me crying and said, “Senator, you must come with me to the cathedral. There are women there who fear for their lives.”

And I left my dinner and I ran down to the cathedral. I came in to the Sacristi of the cathedral and talked with these 13 women who were crying and huddled together, intimidated for their lives. And I listened to their story about how they were counting the raw tally of the votes that was coming in from all across the nation, but the raw tally of votes they were counting was not showing up on the computer tote board recording the votes. They blew the whistle on a dictator. We held an international press conference right there in the cathedral right in front of the alter, and they spoke out, and that was the signal to Marcos it was over. Their courage and the courage of the Filipino people lit a spark that traveled throughout the world, inspiring not just a freshman senator from Massachusetts, but popular movements from Eastern Europe to Burma.

Now, I think about that moment even today, about the power of people to make their voices felt. I think about how Cory Aquino rose to the presidency atop a wave of people power when few believed that she could. I think about how her husband fought for democracy, even at the cost of his own life. And I think about how, decades later, their son would rise to the presidency in democratic elections. In his inaugural address, President Benigno Aquino said: “My parents sought nothing less, died for nothing less, than democracy and peace. I am blessed by this legacy. I shall carry the torch forward.”

My friends, today we must all summon up some of that courage, we must all carry that torch forward. The cause of democracy and peace, and the prosperity that they bring, can bring our legacy in the Asian Pacific, it can define it. Our commitment to that future, believe me it is strong. Our principles are just. And we are in this for the long haul – clear-eyed about the challenges ahead.

Thank you. (Applause.)

Press Releases: Joint Communique AUSMIN 2014

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Minister for Foreign Affairs Julie Bishop, Minister for Defence Senator David Johnston, Secretary of State John Kerry and Secretary of Defense Chuck Hagel met on 12 August in Sydney for the annual Australia-United States Ministerial Consultations (AUSMIN).

On the 29th anniversary of the first AUSMIN, the talks reaffirmed the Alliance’s important contribution to the peace, security, and prosperity of the Asia Pacific and Indian Ocean regions as well as its enduring value in addressing contemporary and evolving challenges in the regions and throughout the world. The Alliance is a cornerstone of our strong and dynamic bilateral relationship, which is based on shared values and close friendship.

1. The Australia-United States Alliance

Australia and the United States reaffirmed the strong state of bilateral defence and security cooperation under the Alliance, as demonstrated through a decade of operations together in Afghanistan and Iraq.

With the signature today of the legally-binding Force Posture Agreement between Australia and the United States, we reaffirmed our commitment to work towards full implementation of the Force Posture Initiatives in Australia. The agreement provides a robust policy and legal framework and financial principles for implementation of the force posture initiatives announced in 2011. It demonstrates the United States’ strong commitment to the Asia Pacific and Indian Ocean regions and Australia’s firm support for the US rebalance. The agreement also reaffirms our mutual intent to deepen our relationship and regional security through expanded cooperation together and with other countries in the region.

Australia and the United States welcomed the larger US Marine Corps presence under the third rotational deployment currently in Darwin and discussed the way forward for enhanced aircraft cooperation. They discussed the potential for additional bilateral naval cooperation and welcomed the significant, wide-ranging series of port visits planned for 2015. They also asked their respective officials to develop practical options to enhance naval training and exercises in Australia and the region.

Acknowledging the high-level of interoperability between Australian and US Special Forces, both sides supported fostering these links to address shared threats and enhance capacity within the region.

The two countries committed to continue to work together to counter the growing threat of ballistic missiles in the Asia Pacific region, including by establishing a bilateral working group to examine options for potential Australian contributions to ballistic missile defence in the region.

Australia and the United States reaffirmed their intention to continue strategic planning collaboration between their respective defence departments, to develop common approaches to regional security challenges, and to harness opportunities for greater defence cooperation across the Asia Pacific and Indian Ocean regions.

They highlighted the importance of the bilateral Exercise Talisman Sabre to continue to enhance Australia-US interoperability, practise our joint collective capabilities, and demonstrate mutual resolve in maintaining joint defence readiness under the Alliance. They emphasised the importance of civilian agency participation in the Exercise and the desire to strengthen our capacity to deliver humanitarian assistance and disaster relief, and incorporate ‘women, peace and security’ objectives into our combined planning. They planned to hold the next round of the bilateral Political-Military Talks at the earliest opportunity.

Australia and the United States reaffirmed their commitment to practical space cooperation, encouraged by recent steps towards establishing combined operations. They welcomed the significant progress made toward establishing the C-Band space surveillance radar and the Space Surveillance Telescope in Australia. They reiterated support for regional and global efforts to strengthen the safety, security and sustainability of space, including finalising the International Code of Conduct for Outer Space Activities.

Australia and the United States welcomed continued high-level bilateral cooperation on defence science and technology. The rise of increasingly sophisticated and complex threat environments, combined with continued resource pressures, makes the development of affordable capabilities an imperative. This includes diverse areas such as cyber, electronic warfare, hypersonics, as well as integrated intelligence, surveillance, and reconnaissance technologies.

Australia and the United States reflected on defence industry collaboration between the two countries. Over the last decade, Australia has agreed to purchase important capabilities from the United States, including the F-35 Joint Strike Fighter, EA-18G Growler, P-8A Poseidon maritime surveillance aircraft and E-7A Wedgetail early warning aircraft. These shared platforms and capabilities provide opportunities to maintain and enhance bilateral interoperability.

Both countries emphasised that international law, including the United Nations Charter and, where relevant, international humanitarian law, applies to state conduct in cyberspace and reaffirmed that Australia and the United States would act in accordance with their obligations.

Both countries welcomed the expansion of bilateral trade and investment, driven by the strong affinities between our economies. They noted the dynamism and diversity in the economic relationship, including the significant level of business engagement across a broad spectrum of economic activity. Both countries looked forward to celebrating the 10th anniversary of the entry into force of the Australia-United States Free Trade Agreement on 1 January 2015. The Agreement has deepened economic integration and boosted both economies.

Australia and the United States reaffirmed the importance of their people-to-people ties. The two countries also noted this year as the 65th anniversary of the Australian-American Fulbright Commission, which has supported the professional growth of close to 5,000 students and scholars, and enriched bilateral relations.

Both countries welcomed the growth in cooperation on innovation, energy, science, technology and health. Bilateral innovation cooperation will strengthen our work on cutting edge issues, ranging from neuroscience to clean energy and energy efficiency, to research on global ocean acidification, to information technology and bio-preparedness.

2. Asia Pacific and Indian Ocean regions

Australia and the United States reaffirmed their commitment to comprehensive engagement in the rapidly developing Asia Pacific and Indian Ocean regions. Australia expressed support for the United States’ role in underpinning the regions’ security, stability and prosperity. The United States welcomed the important contribution that Australia’s wide-ranging engagement in those regions continues to make to security and stability.

They recognised regional economic integration and development as essential to the future prosperity of Australia and the United States, and of the Asia Pacific and Indian Ocean regions as a whole. They supported economic initiatives that foster growth and market openness, and deepen economic integration in those regions and globally.

Australia and the United States reaffirmed their strong commitment to concluding an ambitious, high quality, comprehensive Trans-Pacific Partnership agreement (TPP) as soon as possible. This will deepen regional integration, open new trade and investment opportunities, create jobs, and support economic growth.

They pledged to work closely in support of the Asia Pacific Economic Cooperation’s (APEC) agenda to advance economic integration across the Asia Pacific region, especially in the areas of trade and investment liberalisation, structural reform and regulatory coherence, enhancing global value chains, improving supply-chain performance, combating corruption, promoting cross-border education cooperation, and women’s economic empowerment.

Australia and the United States shared their views that the East Asia Summit (EAS) is the premier regional forum for dialogue and cooperation on the political, security, strategic and relevant economic challenges confronting the Asia Pacific and Indian Ocean regions. They will work more closely together, and with EAS partners, in continuing to enhance the EAS’ role, through deepening its agenda on maritime security, non-proliferation and disaster response, and building synergies with other regional forums.

Australia and the United States welcomed the practical cooperation fostered under the ASEAN Regional Forum (ARF) and the ASEAN Defence Ministers’ Meeting Plus (ADMM+) and expect to cooperate closely to ensure an open dialogue on key regional security issues. They intend to build confidence through maritime security and maritime domain awareness, non-proliferation and disarmament, humanitarian assistance and disaster relief, counter-terrorism, space and cyber security. Both countries strongly supported the ARF’s work on preventive diplomacy and also noted their partnership in encouraging the ARF and ADMM+ to develop a regional strategic multi-year exercise plan to coordinate and improve the effectiveness of humanitarian assistance and disaster relief activities. They reaffirmed their support for the Expanded ASEAN Maritime Forum (EAMF) as an important avenue for regional discussion of maritime issues. They are working closely together in taking forward a workshop on maritime environmental pollution in October 2014 under the US-led Expanded ASEAN Seafarer Training (EAST) initiative.

The two countries underscored their shared interest in the maintenance of peace and stability, respect for international law, unimpeded lawful commerce, and upholding freedom of navigation and overflight in the East China and the South China Seas. They called on claimants to refrain from actions that could increase tensions and to clarify and pursue claims in accordance with international law, including as reflected in the Law of the Sea Convention. They reaffirmed support for the rights of claimants to seek peaceful resolution of disputes, including through legal mechanisms such as arbitration under the Law of the Sea Convention. They opposed unilateral attempts to change facts on the ground or water through the threat or use of force or coercion.

The two countries emphasised the need for South China Sea claimant states to build upon the framework for managing disputes set forth in the 2002 Declaration on the Conduct of Parties in the South China Sea, including the commitment of ASEAN states and China to “undertake to exercise self-restraint in the conduct of activities that would complicate or escalate disputes and affect peace and stability.” They encouraged claimant states to reach consensus on what types of activities should be permissible and what types of activities should be avoided in areas that are in dispute. They underscored that such a voluntary arrangement would serve as a good faith gesture among all parties and could help facilitate the early completion of a meaningful Code of Conduct in the South China Sea. The United States and Australia affirmed their support for a voluntary ‘freeze’ by claimants on activities in disputed maritime areas.

Australia and the United States acknowledged the significance of Indonesia’s third direct presidential election. They recognised the significant contributions of outgoing President Susilo Bambang Yudhoyono in leading his country, and welcomed Indonesia’s leadership role in the Asia Pacific and Indian Ocean regions. Both countries look forward to working closely with Indonesian President-elect Joko Widodo and his administration after his inauguration in October. They affirmed their desire to seek opportunities to enhance joint cooperation with Indonesia on defence as well as humanitarian assistance and disaster relief.

Affirming the longstanding and enduring friendship among Australia, the United States and the people of Thailand, both countries recognised that Thailand faced complex challenges that only the Thai people could address. They noted that Australia and the United States had expressed concern about the military coup. They looked forward to a transition to civilian rule and a return to democracy, stressing the importance of inclusive processes which reflect the will of the Thai people. They also stressed the importance of respect for human rights and fundamental freedoms.

Australia and the United States welcomed Burma’s commitment to political, economic and social reforms and encouraged further efforts towards constitutional reform, free and fair elections in 2015, and protecting the rights of all people in Burma. They also welcomed ongoing efforts to reach a nationwide ceasefire with ethnic armed groups and encouraged an inclusive political dialogue with stakeholders to achieve a lasting peace. They acknowledged steps that Burma has taken regarding non-proliferation, including its signature of the Additional Protocol with the IAEA in September 2013, and agreed on the importance of Burma severing all proscribed activities with the Democratic People’s Republic of Korea, in accordance with relevant UN Security Council resolutions. They supported Burma’s deepening engagement with the international community and acknowledged its chairmanship of ASEAN and the East Asia Summit in 2014.

Australia and the United States welcomed Japan’s efforts to make a greater contribution to international peace and stability, including through its decision to allow for the exercise of its UN Charter right to collective self-defence. They undertook to maintain strong bilateral security relationships with Japan and committed to enhance trilateral security and defence cooperation, including through the Trilateral Strategic Dialogue and further developing existing trilateral exercises.

The two countries committed to intensify their collaboration with the Republic of Korea to promote stability on the Korean Peninsula, in the wider region and globally, through expanded trilateral security and defence cooperation and by working together in bodies such as the UN Security Council, including on peacekeeping, counter-proliferation, maritime cooperation and humanitarian assistance and disaster relief.

Australia and the United States reaffirmed their commitment to building positive and constructive relations with China, including by pursuing dialogue on strategic security issues and by expanding practical cooperation in support of their common interest in maintaining regional peace and stability, and respect for international law. They will endeavour to strengthen their comprehensive and cooperative relations with China, including through stronger economic engagement, and to encourage China to make further progress in respect for human rights. They welcomed China’s contributions to United Nations peacekeeping operations and international efforts to combat piracy in the Gulf of Aden, as well as its participation in the 2014 Rim of the Pacific Exercise (RIMPAC). They looked forward to joining China for the inaugural iteration of Exercise Kowari, a trilateral defence exercise to be conducted in Australia in October.

Australia and the United States underscored their serious concern that Democratic People’s Republic of Korea’s (DPRK) behaviour undermined the stability of the entire region and called on the DPRK to cease its threats and provocations, comply with its international commitments and obligations, including by abandoning its nuclear, missile and proliferation activities. They expressed their deep concern for the welfare of the North Korean people and the abducted citizens of other countries, called on the DPRK to implement the UN Commission of Inquiry’s recommendations for ending the ongoing systematic, widespread, and extreme violations of human rights, and reiterated that those responsible must be held to account.

Both countries welcomed their close cooperation with affected countries in the region and beyond during the initial surface search for missing Malaysia Airlines flight MH370. This joint effort was a powerful example of regional cooperation. Australia, Malaysia and China continue the search, with an intensive underwater search of 60,000 km2 due to start in early September after a bathymetric survey.

Australia and the United States recognised India’s position as the world’s largest democracy and an important economic and strategic power in the Asia Pacific and Indian Ocean regions. They intend to work with India to expand trilateral cooperation, including on shared challenges such as maritime security, energy security, and ensuring economic growth, and through collaboration in regional institutions.

They recognised the important role that the Indian Ocean Rim Association (IORA) played as the only ministerial-level grouping that spans the Indian Ocean region. They intend to continue to support IORA’s work to facilitate closer cooperation in the Indian Ocean region. As IORA Chair, Australia reaffirmed its intention to develop a stronger policy agenda for IORA and welcomed the United States’ participation as a Dialogue Partner at the Council of Ministers Meeting to be held in Perth on 9 October.

The two countries expect to further enhance maritime security cooperation, including combating piracy and promoting regional security, stability and freedom of navigation, by working closely together under the US-led Combined Maritime Forces in the Indian Ocean and through the Regional Cooperation Agreement on Combating Piracy and Armed Robbery against ships in Asia (ReCAAP), which the United States will join in September.

Australia and the United States encouraged Fiji’s progress toward holding elections on 17 September. They will continue to work together with other international partners to support elections and democratic reforms in Fiji.

They reaffirmed their commitment to assist the Pacific Island countries in realising their goal of a stable, secure and prosperous region. They welcomed the adoption of a new Framework for Pacific Regionalism by Pacific Islands Forum Leaders at their July meeting. Both countries welcomed the election of Dame Meg Taylor of Papua New Guinea as the first female Secretary General of the Pacific Islands Forum Secretariat.

They undertook to continue to work together in pursuit of the sustainable management of oceans and fisheries, which are among the key development challenges in the Pacific and globally. They reaffirmed their commitment to cooperative efforts to address illegal, unreported and unregulated (IUU) fishing.

Australia and the United States will endeavour to continue to provide development assistance that fosters economic growth and prosperity in the Asia Pacific and Indian Ocean regions. They intend to continue supporting development programs that reduce poverty by promoting innovation, gender equality, education and health, and collaborate on the provision of humanitarian assistance.

Australia and the United States reaffirmed their shared commitment to advance gender equality and the status of women and girls. In particular, they recognised that women’s economic empowerment is a significant driver of growth and development, and planned to work together to promote women’s employment and economic opportunity, particularly in the Asia Pacific and Indian Ocean regions.

3. Global challenges

Australia and the United States plan to work together through the G20 toward achieving their shared goals of promoting strong, sustainable, and balanced global economic growth and employment, and increasing the resilience of the global economy, including by strengthening infrastructure investment, enhancing trade and building cooperation on energy, including on energy efficiency. The United States shared Australia’s ambition for G20 members to boost the collective GDP of members by more than two per cent above current projections over the next five years.

Recognising the challenges climate change poses to security, Australia and the United States intend to continue to work through the UN Framework Convention on Climate Change process to negotiate a new, ambitious climate agreement applicable to all countries by 2015 to take effect in 2020.

The United States welcomed Australia’s engagement on the Global Health Security Agenda, which seeks to accelerate progress toward a world safe and secure from infectious disease threats and to promote global health security as an international security priority.

The United States welcomed Australia’s strong contribution during its term on the United Nations Security Council (UNSC) and our shared efforts to reach constructive and practical solutions to international peace and security issues. Both countries are continuing to work closely to tackle serious challenges before the Council, including the ongoing conflict and humanitarian crisis in Syria, protection of civilians in conflict zones, effective implementation of sanctions, countering the international terrorist threat and regional weapons proliferation.

Australia and the United States reaffirmed their commitment to the sovereignty and territorial integrity of Ukraine. Russia’s purported annexation of Crimea has no basis in international law.

Both countries condemned Russia’s support for and enabling of the continued destabilisation of eastern Ukraine; destabilisation which led to the shooting down of a passenger airliner, Malaysia Airlines flight MH17, killing all 298 on board. Both countries affirmed their commitment to completing a full international investigation into the attack¬¬– an appalling tragedy and terrible act of senseless violence – including through implementation of UNSC Resolution 2166 on MH17.

Australia and the United States condemned in the strongest possible terms the actions of the Islamic State of Iraq and the Levant (ISIL) and other armed opposition groups in Iraq. They welcomed the nomination of Dr Haider al-Abadi as Prime Minister-designate, and encouraged him to form a new and inclusive Iraqi Government as soon as possible. They called on all Iraqi leaders to work closely together and adopt a unified approach to addressing the country’s challenges. The two countries indicated their deep concern about recent developments in northern Iraq and their commitment to work together and with other partners to undertake humanitarian operations to relieve besieged communities and to combat the threat posed by ISIL.

The two countries discussed the worsening humanitarian, social and political crisis in Syria and reaffirmed the urgent need for a political solution to the conflict consistent with the Geneva Communiqué. They also called for all nations to cooperate in applying pressure to those responsible for the crisis, the Assad regime and violent radical extremists, and to provide humanitarian aid for the civilian population suffering from the conflict. They expressed their intention to continue to work through the UNSC to press the parties to the conflict, and particularly the Syrian regime, to adhere to the provisions of UNSC Resolution 2139 on the protection of civilians and humanitarian access and UNSC Resolution 2165 on humanitarian access.

They intend to continue to work closely together and with the international community to address the national security risks posed by foreign fighters in the conflicts in Syria and Iraq, and the impact of their return, particularly in Southeast Asia. They will work together also in developing a set of established best practices for addressing this threat at the national level, including through legislation, border security, immigration and consular policies.

Australia and the United States reaffirmed their intention to continue assisting the Government of Afghanistan as it assumes full responsibility for the security of Afghanistan post-2014 and works to increase stability and prosperity. They welcomed the commitment of the parties to form a government of national unity.

They acknowledged the importance of Pakistan to South Asian stability and welcomed Prime Minister Sharif’s commitment to economic reform. They committed to continue to work with Pakistan to help it address ongoing security and development challenges, including its critical energy needs.

Australia and the United States called on Iran to continue engaging constructively with the P5+1 to negotiate a joint comprehensive plan of action to resolve international concerns about its nuclear program, and called on Iran to resolve all outstanding issues related to its nuclear program – particularly those concerning its possible military dimensions – and fully and urgently to implement Iran’s Framework for Cooperation agreed with the International Atomic Energy Agency. They urged Iran to take tangible steps to improve the country’s human rights situation and to cooperate fully with the UN Special Rapporteur.

Both countries reaffirmed their commitment to working with Israel and the Palestinians, the United Nations and international partners to support the resumption of direct negotiations towards a just and lasting two-state solution. They expressed the need for an unconditional, prolonged ceasefire that significantly de-escalates the violence and leads to a permanent cessation of hostilities. Both countries are providing urgently needed humanitarian assistance to Gaza in addition to carrying through with existing commitments for development assistance to the Palestinian Territories.

The two countries called on Egypt to demonstrate its commitment to inclusive democracy, economic reform, human rights and fundamental freedoms in the interests of long-term stability. They expressed their deep disappointment about the recent decision by an Egyptian court to impose lengthy jail sentences on journalists, including Australian reporter Peter Greste. They pledged to continue representations at senior levels of the Egyptian Government to underline their concerns about the restrictions on freedom of expression in Egypt, including the targeting of journalists simply for doing their jobs. They called for the resolution of these cases as soon as possible.

Australia and the United States continued to support counter-terrorism cooperation and capacity building in South Asia, Southeast Asia, the Middle East, Eastern Africa, and through the Global Counter-Terrorism Forum. Australia and the United States reaffirmed intelligence cooperation and sharing as core elements of the Alliance that make a vital contribution to managing threats.

They reaffirmed their shared commitment to continue to work closely and cooperatively to help prevent the proliferation of weapons of mass destruction and their means of delivery. The use of chemical weapons in Syria served as a stark reminder of the gravity of this threat and the two sides reiterated their condemnation of Syria’s actions. They noted the contributions of the annual Australia-US Counterproliferation Dialogue in coordinating responses to proliferation threats in the Southeast Asia region and elsewhere, and committed to continue to put priority on this cooperation in the future.

The two countries encouraged the earliest entry into force and effective implementation of the Arms Trade Treaty (ATT), while recognising that the international trade in arms is a legitimate commercial activity. The ATT provides an important means of preventing and eradicating illicit trade in small arms.

4. AUSMIN 2015

The United States offered to host the next AUSMIN meeting in 2015.

End Text

U.S.-China Relations

Introduction

Chairman Menendez, Ranking Member Corker, Members of the Committee, thank you for the opportunity to testify today on U.S.-China relations. It is also a great honor to be participating in today’s hearing with one of our nation’s most accomplished diplomats, Ambassador Stapleton Roy – a friend, former colleague, and one of the foremost experts on U.S.-China relations. Ambassador Roy’s contributions to the U.S.-China relationship have been invaluable, and I look forward to hearing his insights.

I would also like to take this opportunity to thank you, Mr. Chairman, for your leadership and to acknowledge this Committee’s contributions to the rich bipartisan tradition of engaging China. I have found it extremely valuable to work closely with the Committee’s Members, and in particular with the Asia Sub-committee, in advancing U.S. interests vis-à-vis China and the Asia-Pacific region as a whole.

Overall Bilateral Relations

This year marks the 35th anniversary of the establishment of official diplomatic relations between the United States and China. We have made remarkable progress since the era of back-channel messaging and secret trips. The scope of today’s U.S.-China relationship was unimaginable when President Nixon made his historic visit in 1972 to China.

Yet there is still enormous potential for progress in the U.S.-China relationship. Progress that will yield benefits to the citizens of both countries, our neighbors, and the world. To realize this progress and these benefits, we seek to ensure that the relationship is not defined by strategic rivalry, but by fair and healthy competition, by practical cooperation on priority issues, and by constructive management of our differences and disagreements. Where interests overlap, we will seek to expand cooperation with China. These areas include economic prosperity, a denuclearized Korean Peninsula, peaceful resolution of the Iranian nuclear issue, and a reduction in the emission of greenhouse gases. Where they diverge – and we have significant and well-known areas of disagreement – we will work to ensure that our differences are constructively managed.

Mr. Chairman, there are those who argue that cold war-like rivalry is inevitable and that the United States and China are condemned to a zero-sum struggle for supremacy, if not conflict. I reject such mechanistic thinking. As anyone who has served in government can tell you, this deterministic analysis overlooks the role of leaders who have the ability to set policy and to shape relationships. It gives short shrift to the fact that our two economies are becoming increasingly intertwined, which increases each side’s stake in the success of the other. It undervalues the fact that leaders in Washington and Beijing are fully cognizant of the risk of unintended strategic rivalry between an emerging power and an established power and have agreed to take deliberate actions to prevent such an outcome. And it ignores the reality of the past 35 years – that, in spite of our differences, U.S.-China relations have steadily grown deeper and stronger – and in doing so, we have built a very resilient relationship.

We view China’s economic growth as complementary to the region’s prosperity, and China’s expanded role in the region can be complementary to the sustained U.S. strategic engagement in the Asia-Pacific. We and our partners in the region want China’s rise to contribute to the stability and continued development of the region. As President Obama and Secretary Kerry have made very clear, we do not seek to contain China; to the contrary, we welcome the emergence of a stable, peaceful, and prosperous China. We believe all countries, and particularly emerging powers like China, should recognize the self-benefit of upholding basic rules and norms on which the international system is built; these are rules and norms which China has participated in formulating and shaping, and they are rules and norms that it continues to benefit from. In this context, we are encouraging China to exercise restraint in dealing with its neighbors and show respect for universal values and international law both at home and abroad.

A key element of our approach to the Asia-Pacific region, often called the rebalance, is strengthening America’s alliances and partnerships in the region. This contributes directly to the stable security environment that has underpinned the region’s – and China’s – dramatic economic growth and development.

A second element is working to build up regional institutions in order to uphold the international rules-based system and create platforms for the countries and leaders to work on priority strategic, economic, and other issues. These institutions help develop habits of cooperation and promote respect for the interests of all parties.

A third key element has been expanding and deepening our relationships with important emerging countries such as China, including through regular and high-level dialogue.

In just two weeks, our countries will hold the sixth round of the U.S.-China Strategic and Economic Dialogue – the “S&ED” – in Beijing. This annual dialogue is unique in its level and scope. It is led on the U.S. side by Secretaries Kerry and Lew and brings a number of Cabinet-level and other senior U.S. government officials together with their Chinese counterparts to work on the major issues facing us. The breadth of the agenda in the two tracks – strategic and economic – reflects the breadth of modern U.S.-China relations. The S&ED is an important vehicle for making progress in the pursuit of a cooperative and constructive relationship; for building a “new model” that disproves the thesis that the United States and China are somehow destined for strategic rivalry and confrontation.

The S&ED is an important forum for the United States and China to take stock of and set goals for the bilateral relationship, to review regional and international developments and explain our respective policies, to coordinate and seek practical areas of cooperation on important issues of mutual interest, and to constructively manage areas of difference through candid, high-level discussions.

Let me preview of some of the topics for upcoming discussions at this year’s S&ED:

  • We will exchange views and explore prospects for progress on regional challenges, including Sudan, Afghanistan, Iran, North Korea, Ukraine, Iraq, and maritime disputes in the South and East China Seas;
  • The world’s two largest economies will work on strengthening the global economic recovery;
  • The world’s two biggest energy consumers and carbon emitters will work on combating climate change, and expand cooperation on clean energy;
  • We will discuss global challenges ranging from cyber security to counterterrorism to wildlife trafficking, and the United States will raise our concerns over human rights;
  • Secretary Kerry will co-chair the annual U.S.-China High-Level Consultation on People-to-People Exchange, which supports exchange programs that build the foundation for mutual understanding and trust;
  • And Deputy Secretary of State Bill Burns and his Chinese counterpart will hold the U.S.-China Strategic Security Dialogue (SSD), our highest-ranking joint civilian-military exchange with China, where we will conduct frank discussions on some of the most sensitive strategic issues in the relationship.

The S&ED and our numerous other dialogues and official exchanges with the Chinese each year reflect the importance we attach to managing this relationship. This level and pace of engagement show the commitment of both sides to producing tangible benefits for our two peoples, the Asia-Pacific region, and the global community.

The United States and China have a vital stake in each other’s success. That is why we maintain an intensive schedule of engagement; President Obama and President Xi met in Sunnylands, California, a year ago and have met twice more since then. The President plans to visit Beijing in November when China hosts APEC. Secretary Kerry, as well as numerous Cabinet and sub-Cabinet officials, have visited China already in 2014 and have met with Chinese counterparts in the United States or at international fora.

We work with China in virtually all important international arenas, including the UN, the G20, the East Asia Summit, and APEC where we are cooperating closely on regulatory transparency, supply chain efficiencies, promoting clean and renewable energy, cross-border education, and combatting corruption and bribery. Our relationship touches on nearly every regional and global issue, and, as such, requires sustained, high-level attention. Moreover, few of these issues can be effectively addressed if China and the United States do not cooperate.

Economic Relations

Economic issues play a central role in the U.S.-China relationship. China’s economic success has added to our growth and increased the purchasing power of consumers in the United States. Our two-way trade has almost quadrupled since China joined the WTO in late 2001. While the long-standing imbalance in that trade remains troubling, China is now one of the fastest growing U.S. export markets. In fact, U.S. exports to China grew by more than 90 percent between 2007 and 2013. In our bilateral engagements, we are encouraging economic reforms within China to ensure not only that its economic behavior is sustainable on its own terms, but that it contributes to strong, sustainable and balanced growth of the global economy. This includes re-orienting its economy away from a development model reliant on exports and credit-fueled investment in real estate and infrastructure to one that increases consumer spending and contributes to global demand. Central to this goal has been urging China to move toward a market-determined exchange rate. We are also addressing sources of friction in our bilateral relationship by pressing China to change a range of discriminatory policies and practices that harm U.S. companies and workers and that undermine incentives to innovate. These include subsidies that tilt the competitive playing field in favor of Chinese national champions, policies that pressure companies to hand over intellectual property as a condition for access to the Chinese market, and export credits that unfairly advantage Chinese companies in third markets. U.S. businesses have investments totaling over $50 billion. And from 2012 to 2013, Chinese direct investment flows into the United States more than doubled, according to private sector figures, and now contribute to thousands of jobs here. Our ongoing bilateral investment treaty negotiations hold the potential for even more mutually beneficial economic ties.

Even as we increase trade and investment, we will continue insisting on tangible progress in other economic areas that matter to the United States. These include:

  • China continuing to move toward a market-determined exchange rate;
  • negotiating a Bilateral Investment Treaty;
  • increasing access to Chinese markets for U.S. businesses;
  • developing a more transparent regulatory regime;
  • ending industrial policies that favor state-owned enterprises and national champions and seek to disadvantage foreign companies and their products;
  • ending forced technology transfer; and
  • addressing U.S. concerns over the theft of intellectual property and trade secrets, including government-sponsored, cyber-enabled theft for the purpose of giving Chinese companies a competitive advantage.

We will also continue to encourage greater Chinese integration into the rules-based international economic and trading system, in order to create a level playing field

for domestic and foreign companies operating in its and other markets. Over the last few months, China’s leaders have announced plans for sweeping reforms that, if realized, could go a long way in moving China’s economy toward market principles. We are encouraged that these announced reforms would potentially give the market a greater role in the economy, and we are keenly interested to see such reforms put into practice. I believe we can do much to work with China as it transitions to a consumption-driven, market-oriented growth model that would benefit both our economies.

Military-to-Military Relations

On the military side of the U.S.-China relationship, we are committed to building a sustained and substantive military-to-military relationship that focuses on identifying concrete, practical areas of cooperation and reducing risk. This includes not only deepening the use of institutionalized dialogue mechanisms, including senior defense participation at the SSD and S&ED, but also inviting the Chinese to join regional cooperative exercises and expanding talks with the Chinese military about operational safety in the region. For the first time this year, China will participate in RIMPAC June 26-August 1 in Hawaii.

We also aim to continue high-level exchanges between our militaries. Recent exchanges have included visits to China by Secretary Hagel in April and General Odierno in February, and a visit to the United States by Chief of the General Staff General Fang Fenghui in May.

At the same time, we will continue to carefully monitor China’s military developments and encourage China to exhibit greater transparency with respect to its military spending and modernization. This will help countries better understand the motivations of the People’s Liberation Army. We continue to encourage China to use its military capabilities in a manner conducive to the maintenance of peace and stability in the Asia-Pacific region.

Global and Regional Issues

As the largest energy consumers, greenhouse gas emitters, and renewable energy producers, the United States and China share common interests, challenges and responsibilities. These are issues that relate directly to our economic and national security. Cooperation on climate change, energy, and environmental protection is more critical than ever and is an important area of focus in the U.S.-China bilateral relationship.

Through broad dialogues such as the Ten-Year Framework for Energy and Environment Cooperation and the S&ED, over the last year we have been able to produce new and expanded commitments to cooperation on climate change, energy, and the environment. During Secretary Kerry’s February trip to Beijing, he announced implementation plans for each of the five initiatives under the Climate Change Working Group as well as a new enhanced policy dialogue on domestic and international policies to address climate change that will be held on the margins of the upcoming S&ED.

China is a vital partner on some of the world’s most pressing proliferation challenges, including the DPRK and Iran. The United States and China agree on the importance and urgency of achieving a denuclearized, stable, and prosperous Korean Peninsula. While differences remain between us on some of the tactics, we coordinate closely and consult intensively on how to advance these shared goals. The result has been a tightened web of sanctions targeting North Korea’s nuclear, ballistic missile, and proliferation efforts. China has also strengthened its own sanctions enforcement, which we welcome, though it could do more to prevent North Korea from engaging in proliferation activities. Indeed, North Korea remains in flagrant violation of the UN Security Council resolutions that the United States and China approved and support. So we are urging China to make greater use of its unique leverage with the DPRK to produce concrete signs that the DPRK leader has come to the realization that his only viable path forward is denuclearization.

On Iran, the United States and China share the goal of preventing Iran from acquiring a nuclear weapon and are working together within the P5+1 negotiations with Iran toward that goal. Through our frequent and high-level engagement, we will continue to press China to honor its commitments, in particular those related to its imports of Iranian oil and enforcement of UN sanctions, in furtherance of reaching a comprehensive and long-term solution to the Iran nuclear issue.

Managing Differences

In the Asia-Pacific region, Beijing’s neighbors are understandably alarmed by China’s increasingly coercive efforts to assert and enforce its claims in the South China and East China Seas. A pattern of unilateral Chinese actions in sensitive and disputed areas is raising tensions and damaging China’s international standing. Moreover, some of China’s actions are directed at U.S. treaty allies. The United States has important interests at stake in these seas: freedom of navigation and overflight, unimpeded lawful commerce, respect for international law, and the peaceful management of disputes. We apply the same principles to the behavior of all claimants involved, not only to China. China – as a strong and rising power – should hold itself to a high standard of behavior; to willfully disregard diplomatic and other peaceful ways of dealing with disagreements and disputes in favor of economic or physical coercion is destabilizing and dangerous.

The United States does not take sides on the sovereignty questions underlying the territorial disputes in the South and East China Seas, but we have an interest in the behavior of states in their management or resolution of these disputes. We want countries, including China, to manage or settle claims through peaceful, diplomatic means. For example, the Philippines and Indonesia have just done so in connection with their EEZ boundary. Disputes can also be addressed through third-party dispute resolution processes. Where parties’ rights under treaties may be affected, some treaties provide for third-party dispute settlement, as is the case of the Law of the Sea Convention, an avenue pursued by the Philippines in an arbitration with China currently being considered by an Arbitral Tribunal constituted under that treaty. The United States and the international community oppose the use or the threat of force to try to advance a claim, and view such actions as having no effect in strengthening the legitimacy of China’s claims. These issues should be decided on the basis of the merits of China’s and other claimants’ legal claims and adherence to international law and norms, not the strength of their militaries and law enforcement ships or the size of their economies.

Another area where we believe China’s actions run counter to important universal principles is the worsening human rights situation in China. Just this month, China conducted a harsh crackdown on commemorations of the 25th anniversary of Tiananmen Square. China’s actions included the detention, harassment and arrests of journalists, lawyers, and activists. Top U.S. officials raise our concerns with Chinese leaders on a regular basis, and, as we have in every previous round, Secretary Kerry plans to raise human rights at this year’s S&ED. We express concern about the Chinese government’s censorship of the media and Internet. We push for the release of all political prisoners, including but not limited to prominent figures like Liu Xiaobo. We urge China to address the policies in Tibetan areas that threaten the distinct religious, cultural, and linguistic identity of the Tibetan people. Instability and violence are on the increase in the Xinjiang Uighur Autonomous Region. As we unequivocally condemn the acts of terrorism and violence, we also urge China to take steps to reduce tensions and reform counterproductive policies that stoke discontent and restrict peaceful expression and religious freedom.

Conclusion

Clearly, a wide-ranging and complex relationship such as ours with China comes with challenges. Some degree of friction is inevitable. But an essential tool for managing and resolving differences is open and extensive communications between our two countries – at senior and working levels of government, military to military, through local governments and organizations, between our business communities, and at the grassroots level.

We are now reflecting on the considerable progress attained in 35 years of bilateral relations. One key lesson is that to ensure that our relationship grows and matures, we need to build up the links among our two peoples. People-to-people exchanges are essential to enhancing mutual understanding and furthering U.S. strategic and economic goals. To that end, the United States in 2013 received 1.8 million Chinese visitors who collectively spent $9.8 billion on goods and services in our economy. Our State Department personnel work hard to facilitate growing Chinese demand for international travel by maintaining average visa wait-times under five days over the past two years.

Education also plays an important role fostering mutual understanding. In 2013, we had 235,000 students from China studying in the United States, more than from any other country, and the United States aspires to increase the number of American students studying in China and learning Mandarin through the 100,000 Strong Initiative. In March, PRC First Lady Peng Liyuan welcomed First Lady Michelle Obama to China where together they met with U.S. and Chinese students and faculty and promoted the value of study abroad and educational exchange.

We are also working with groups like the Sister Cities International and the U.S.-China Governors Forum. These programs help by encouraging and supporting cities and states to deepen their cultural or commercial ties with Chinese counterparts. In the last year alone, we have supported numerous visits of governors and state delegations and helped them to find opportunities to deepen their involvement and links to China.

The Department works closely with the United States Chamber of Commerce, AmCham China, the U.S.-China Business Council, and other business groups to support key priorities for U.S. companies doing business in China and to promote – greater Chinese investment in the United States. In partnership and consultation with those organizations, we have encouraged the Chinese government to eliminate investment restrictions, strengthen IPR protection, increase regulatory transparency, and establish a level playing field for all companies in China.

In conclusion, let me paraphrase what President Obama said earlier this year when he met with Chinese President Xi at the Nuclear Security Summit in The Hague. The U.S.-China relationship has made great strides over these past several decades, and both sides are committed to building a new model of relations between our countries defined by expanded cooperation and constructive management of differences.

Mr. Chairman, I thank you for the opportunity to appear before you today to discuss U.S.-China relations. I look forward to answering any questions you and others from the Committee may have.

Press Releases: Remarks on the Trafficking in Persons Report 2014

MR. RATHKE: Okay. Thank you, operator. I’m Jeff Rathke, director of the Press Office here at the State Department. And today we’re doing a call with Ambassador Luis CdeBaca, who is Ambassador-At-Large to Combat Trafficking in Persons. So today’s call will be on the record, but it will be embargoed until the end of Secretary Kerry’s rollout event.

So Ambassador CdeBaca has been in this position for a number of years; he doesn’t really need any introduction to most of you. So I will just turn it over to him and ask him to give us introduction to this year’s report, and then we’ll take some questions afterwards. So please, Ambassador.

AMBASSADOR CDEBACA: Thanks, Jeff. Hello, everybody, and welcome. As Jeff said, Secretary Kerry will be unveiling the 2014 Trafficking in Persons Report. This, of course, is a congressionally mandated report that has us look at the governments around the world and what they are doing to combat trafficking in persons – modern slavery – through the lens of what we call the 3P paradigm of prevention, protection, and prosecution. And in fact, I think as you see the embargoed copy of the report that I think many of you have, you’ll notice that each of the narratives of what’s happening in the countries actually are laid out in that fashion so that you can kind of see exactly how it is that we are analyzing the countries, and frankly, what the evidence is for the eventual ranking.

The rankings – the – it’s a four-tiered ranking system, and so – because it was made by us in the United States by our Congress, it has three tiers for its four-tier ranking. Let me explain what that means. We have Tier One, which is a country that’s actually meeting the minimum standards of fighting human trafficking. And those minimum standards are set out in our trafficking law of 2000, but really track the international standards and best practices that we see around the world. A Tier Two country is one that is not meeting those goals but is striving to do so and has results that you can point to to show that it’s doing a decent job, but could definitely improve.

A Tier Two Watch List – and this is how we get four tiers out of a one, two, and three. The Tier Two Watch List is kind of like a C minus or something like that in the American grading system. It’s warning the countries that are on the Watch List that they are in danger of falling to Tier Three. And one of the biggest categories for that is if what the country is doing is simply in the form of promises of future action. Again, we look for results. And if we can’t show the results on the ground, the actual outcomes, et cetera, then that does not bode well when we’re doing the analysis. And then finally Tier Three, which is a country that is not responding sufficiently to its trafficking problem, isn’t taking those affirmative steps forward, and we’re not – excuse me – seeing the progress that we need to see, especially in light of their particular trafficking problem.

So that’s a quick tour through the tier rankings, and I think that a lot of folks are very interested in that, much like horserace coverage of elections. But I want to talk a few of the top lines as well, as far as what are we seeing in the global fight against modern slavery this year. Very quick review of what we’re talking about when we talk about human trafficking, the definition – this is a umbrella term that the United States Government considers to cover all of the activities involved in reducing someone to or holding them in a condition of compelled service. So there’s nothing in there about moving them across international borders. There’s nothing in there that limits it simply to women or girls. There’s nothing in there that limits it to only in other countries. And there’s nothing in there that limits it only to prostitution or the sex industry as opposed to other forms of trafficking.

So each year for every one of these countries, we’re looking at what are they doing for all of the populations that are victimized by trafficking: How are they helping them? Are they prosecuting the perpetrators and bringing them to justice? And are they working to prevent? And when I say “they,” I mean all of the governments that we look at.

And one of those governments is the United States. The United States has been included in the trafficking report since 2010. The State Department began to rank ourselves in that report for two reasons. First of all, I think that there was a sense during the Obama Administration that it was simply a matter of fairness to all of the other countries; if we’re going to hold them to these minimum standards, that we needed to hold ourselves to them as well. But then also the notion of as a diagnostic tool. If these 11 minimum standards that you’re supposed to look at to see whether you’re doing a decent job on fighting trafficking – if those are truly to be a good diagnostic, then we owed it to ourselves to apply that diagnostic and to see where we could be doing better as the United States.

As far as that’s concerned, I want to just make the point that I think many of you may have already heard me or the Secretary say, which is that no country is doing a perfect job on the fight against human trafficking, and that includes the United States. We are all in this together, because we’re seeing people around the world – whether it’s in agriculture or whether it’s in mining, whether it’s in manufacturing, whether it’s in the sex industry, whether it’s as domestic servants – that when you have unscrupulous and cruel bosses and vulnerable people, you have a recipe for human trafficking. And that’s as true here even in the Washington, D.C. area and the suburbs, as it is in countries around the world.

So I’d certainly, although I think that we’ll probably be looking at some of the other countries, I’d certainly recommend to you all the U.S. narrative as well so you can see what the U.S. Government is doing but also what’s happening out in our communities across the United States, whether it’s to Native American girls, whether it’s to vulnerable men and women because of a disability or a drug addiction, or whether it’s to the young men and women, boys, and girls, who fall prey to the blandishments of pimps who offer a better life and opportunity.

Let me take it a little bit more international though. This year, we see of the 188 countries that are on the report, we see some movement up and down. There’s, I think, some real progress stars, I guess, for lack of a better word, some countries out there that have – that we’ve seen some real progress on. For instance, both Chile and Switzerland are moving up to Tier One on the report this year. Switzerland because they took aggressive steps to close some legal loopholes that actually inadvertently made it legal for people to have children in prostitution. Chad has really stepped up on victim identification and demobilization of child soldiers. We’ve seen the first convictions in the Bahamas and Aruba – small countries, small island countries that, frankly, five years ago would’ve said that they didn’t have any human trafficking. But they’ve realized that it’s something that they have to look for. And once they’ve looked for it, they’ve found it and been able to free some of its victims.

We’ve seen the first government-run shelter being opened by the Government of Jordan. The – a new law recently passed in Haiti – the first time now in 215 or so years in which it is now a crime to enslave someone in Haiti, a law much-awaited in South Africa that we hope will be a good tool in that which is very much the destination country for the southern tier countries in Africa. And even a country that has historically not been a leader on human rights issues, Sudan, the enactment of a modern human trafficking law that’s really the culmination of that government’s coming out and wanting to be able to have those modern tools so that they can help their own citizens and others who might be enslaved and exploited.

There are also downgrades, and I think that that’s something that we see every year – countries that are perhaps taking the foot off the gas pedal a little bit or aren’t doing the kind of work that we would see under the law. And I think one of the things that’s, of course, since the 2008 reauthorization that is of particular note under the U.S. law is what we call the auto-downgrade provisions of the law. This came into effect fully last year for the first time. The law in 2008 basically said that countries cannot be on that Tier Two Watch List that I described a minute ago for too many years in a row, because there was a concern, frankly, on the part of Congress that strategic countries and other countries were being given a bit of a pass and not being taken down to Tier Three but holding steady on Tier Two Watch Lists almost, it seemed to Congress I think, interminably.

And so they put a time limitation on that and – by which time a government has to either improve or will be dropped down to Tier Three on the report. There were seven such countries this year that were in that situation no longer eligible for a waiver in the U.S. national interest. And those were Afghanistan, Barbados, Chad, Malaysia, the Maldives, Thailand, and Venezuela. And what we’ve seen is the two – excuse me, three – of those Tier Two Watch Lists auto-downgrade countries were no longer eligible, and we concluded that there hadn’t been the type of sufficient progress to justify an upgrade. And those were Thailand, Malaysia, and Venezuela. And so each of those countries has now been placed on Tier Three in the report.

In the other countries – Afghanistan, Barbados, Chad, and the Maldives – in each of those countries we see fresh activity. We see new commitments to doing work. We see this notion of cases being done in the first place or victims being helped in new ways. And it’s certainly something that is welcome. And frankly, these are countries who may not have, if it weren’t for the pressure of the auto-downgrade and the good work of our men and women out at our embassies in those countries and others to work with them, might not have been able to make that journey.

I want to say two things about sectoral issues that we’ve been identifying that may be news to some. I think that many people may be aware of some of the abuses that we’ve been recognizing in the last few years in the fishing industry. And in fact we’ve seen the fishing sector now – 51 of the narratives in the TIP report this year are identifying abuses in the fishing industry. And that’s both men that are enslaved out on the boats out at sea and folks in the seafood packing huts and things like that.

But we’ve also seen forced labor in mining noted in the narratives of 46 countries and zero prosecutions or convictions around the world. So we’re very much looking for countries to step up on the mining sector, and that’s everything from things that we might call conflict minerals in Africa or conflict diamonds in North Africa, Northwest Africa, or what we see with the gold mining sector, for instance, in Peru and other places.

And sadly, just as we’ve seen in the fishing industry or the logging industry, there are follow-on effects of a subsidiary sex trafficking that happens – basically men who are enslaved in these camps, held in debt bondage through the old company store scheme, they then bring the women in to serve them as well. So whether it’s in Guyana, Peru, or other places like that, you end up seeing sex trafficking related to the mining sector. And we want to commend Senegal for being the only country in the world this last year who actually achieved a conviction of folks for holding girls in sex trafficking in that mining sector.

Lastly, just want to also point out that there is the child soldiers and Child Soldier Prevention Act list, which is part of the trafficking report each year. And this year one of the countries on that was removed, and that is Chad, as I mentioned earlier, who’s, I think, coming at this with a real energy now. And we hope that we’ll continue to see that on their part.

So I think perhaps we should turn it over and do some questions. Jeff, I’ll leave it back to you.

MR. RATHKE: Thanks very much, Ambassador. Operator, could you please inform everyone or remind them how to register – intend to ask a question?

OPERATOR: Ladies and gentlemen, if you would like to ask a question, please press * then 1 on your touchtone phone. You will hear a tone indicating you have been placed in a queue, and you may remove yourself from queue at any time by pressing the # key. If you are using a speakerphone, please pick up the handset before pressing the numbers. Once again, if you have a question, please press *1 at this time. And a moment here for the first question.

MR. RATHKE: All right. That’s great. We’re ready to go to the first question then, so could you please call the first question, operator?

OPERATOR: Our first question comes from the line of Dana Hughes at ABC News. Please go ahead.

QUESTION: Hi. Thank you for doing this. I have a question about what role you see governance or the breakdown of governance in these rankings. For example, Thailand’s been downgraded and they had a coup. Chad is really increasing its governance. Do you see a direct correlation?

AMBASSADOR CDEBACA: Well, it’s interesting, because the Thailand narrative and the Thailand ranking is based on everything that happened from April 1st, 2013 through March 31st, 2014. And so the coup that you mentioned didn’t happen within that time period. Obviously, there was some fraying around the edges within the Royal Thai Government, and yet the committed folks within the government who were trying to work on this within their own agencies, the – some folks at the Royal Thai Police and folks in the ministry of health and social development – they continued to go out and try to fight trafficking because it was something that they had that personal commitment to.

What we see that’s, I think, perhaps somewhat relevant to that in the Thailand situation that’s very much part of the – kind of permeates the narrative is the anchor on those good efforts of those good people that public corruption and complicity on the part of government officials then places around those who would try to do better. So I think that that kind of corruption and its effect on governance directly undercuts the good work of the folks who are trying to get everything right.

It’s interesting because I think that what we see is this is a rule of law problem. It’s a human rights problem as well. But there are a number of countries in which the government functions at a very high level that human trafficking victims simply aren’t on the radar. And I think that that’s reflected kind of throughout the report that rule of law only is going to work for trafficking victims if governments affirmatively try to bring it to bear on the plight of these vulnerable communities.

So while some of those kind of looking at instability and looking at general governance issues, there often seems to be some correlation. I think that we’ve also seen a lot of human trafficking in cases that are – in countries that are viewed as being governed well and that do well on indices, whether it’s Freedom House or otherwise.

MR. RATHKE: Okay, thanks. Could we move on to the next question, please?

OPERATOR: Okay, our next question comes from the line of Jo Biddle at AFP. Please go ahead.

QUESTION: Hello, good afternoon. Thank you very much. I wanted to ask you about sanctions. I know that there’s a possibility that downgrades can be accompanied by sanctions if the President so decides. And last year we saw Russia and China both downgraded into Tier Three. Were there any sanctions that were accompanied with that, and do you anticipate that with these new downgrades of Thailand, Malaysia and Venezuela that there could be sanctions forthcoming if they do not get their act together?

And I had a follow-up – a different question as well, but perhaps I’ll just ask that one first.

AMBASSADOR CDEBACA: Of course. The sanctions determination is something that we’ll be turning to at this point. There are not just those three countries that are on Tier Three. In fact, there are 23 countries on Tier Three this year. But I think that what we look at each year is, first of all, we have to see what is it that the sanctions analysis has to look at. And first stop is to actually look at what foreign assistance we have because that’s really what we’re talking about. The sanctions here is whether or not the United States will continue to provide foreign assistance. So the first thing that we always have to look at is what is being provided to those particular governments and then also to look to see to what degree we’re providing aid that goes directly to helping fix the thing that we’re trying to solve. So you certainly wouldn’t want to halt the – any assistance that’s going specifically to increasing the capacity of our partners in those governments to fight human trafficking or to help its victims.

So those are some of the things that we’ll take into account as we work with the White House and as we give our recommendations to the President. At the end of the day, this is his decision. And last year, the three auto-downgrade countries that you mentioned – China, Russia, and Uzbekistan – the President decided that it was in the U.S. national interest and would promote the purposes of the trafficking law to waive sanctions against them as well as several other countries. And those are countries that we, again, are very much wanting to and feel we can engage with in order to move forward.

Last year, full sanctions were applied against Cuba, Iran, and Democratic People’s Republic of Korea, and partial sanctions were applied against the DR Congo, Equatorial Guinea, Eritrea, Sudan, Syria, and Zimbabwe.

QUESTION: Okay, thank you very much. And I wondered if I could ask about – I had another question. I wondered if I could ask about the situation in the United States. You give the United States a Tier One ranking, but I believe there have been some issues with money, funds running out for shelters for survivors, and there’s also an issue of, particularly in the sex trafficking, with children being treated as criminals rather than being treated as victims and ending up in front of courts or in cells instead of in – or in police cells rather than in shelters. I did note in the report that you say that there’s much more to be done still in the United States. What are you recommending specifically for the United States in terms of improving your own balance sheet?

AMBASSADOR CDEBACA: Yeah. I mean, I think that to the notion of the funding issues, clearly a lot of social service providers, not just in the trafficking arena but others as well, that were depending upon per capita type of reimbursements from the United States Government, didn’t necessarily get those as quickly as they could have last year. We had a number of things, including the near – the government shutdown and the sequester and other things like that.

Our funding stream that HHS – the Department of Health and Human Services – does is actually – it is a per capita reimbursement. It’s not a kind of one-time grant at the beginning of the year that then the nongovernmental can draw down on. And one of the reasons for that is that there are thousands and thousands of service providers across the United States who may encounter a trafficking victim, and it may be that that’s not their fulltime job, so they wouldn’t be writing a grant specifically for that.

My understanding is that those reimbursements were able to continue and that folks have been backfilled for any monies that they spent on behalf of the trafficking victims. But I think it does show that there’s a need for better thought to be put in.

And that was one of the reasons why, on the plus side of the column this year, we announced in January at the White House the first-ever victim services strategy for the United States, which was brought together by the President’s interagency task force to actually look at this action plan. And we’re very proud of the fact that that was brought in with close consultation with survivors of trafficking, so that we could hear what it was that they had been through, what they saw as the shortcomings.

One of the things, frankly, that we’re having to deal with is a bunch of legacy systems. The child protective services systems in all of the states, each grew up independently and they grew up at a time before the Trafficking Victims Protection Act started looking at child prostitutes, for instance, as victims rather than as criminals. So going back to each state now and trying to get it so that they can make it very clear that these are not delinquent children but dependent children under each of the state laws and making sure that the child protective services understands that these are not criminals but victims is unpacking a multi-billion dollar effort across 57 states and territories as well as at the federal level.

So I think that, in looking at that and looking at the problems of the foster care system, et cetera, we’ve started to see not only the Administration but Congress focusing on that. But at the end of the day, all of the money that’s been appropriated for human trafficking work and all of the legislative fixes to some of those programs are just a drop in the bucket compared to the enormous child protective services structures that we need to turn around to recognize the trafficking victims in their midst.

QUESTION: Thank you.

MR. RATHKE: Okay. Thanks. Next question please.

OPERATOR: Next question comes from the line of Luis Alonso at AP. Please go ahead.

QUESTION: Hi. Good afternoon. Many thanks for doing this. I have two questions as well, if I may. The first one is I couldn’t find a regional summary of the report, so I would like to ask if you could please give – provide us with a comment on the Western Hemisphere, how – what the general trend, how many countries were downgraded – how many countries were downgraded, is it improvement or not compared to last year?

And my second question is, given – related to the unaccompanied minors that are coming through the south border from Central America, is – we all know that the United States has put all those kids into removal proceedings right now. If a big number of them end up being deported and go – sent back to their countries where there is extraordinary violence and many presence of human trafficking, do you foresee that the United States could drop the Tier One position because of this element of the unaccompanied minor who comes into America? Thank you.

AMBASSADOR CDEBACA: Well, let me answer that backwards with the second question first. I think that one of the things that we’re doing is that we are working with the governments in the region to try to improve not only the situation so that families don’t feel that they have to get their children out of harm’s way, whether it’s with gangs or otherwise, but also so that those children can be reunited with their families back home.

The law in question, of the unaccompanied alien minors, is looking to protect them, and which is one of the reasons why the Department of Health and Human Services is involved, unlike with adults who would be interdicted at the border. And in fact, one of the things that is done as part of the unaccounted – unaccompanied alien minor screening is to see whether or not those children were victims of trafficking in that situation. And as with all folks who come before the immigration judges and go through the system, we hope that that kind of screening would be able to help us find the people who need the particular services that trafficking victims so desperately need, and to be able to get them those services.

As far as the hemisphere as a whole, I think that is some movement up, there is some movement down within the hemisphere. Perhaps the most notable downgrade in the hemisphere is not the Venezuelan story from Tier Two Watch List down to Tier Three, but rather the downgrade of Colombia, a country that’s been on Tier One for many consecutive years. I think that what it stands for is the notion that Tier One is not a reprieve, it’s a responsibility, and the responsibility to continue to investigate cases, to continue to seek out good victim care interventions, and to look at all forms of trafficking. The Colombians were focused so much on international sex trafficking of Colombians and transnational cases that cases of Colombians at home and others, whether it was in the mining sector, whether it was in the sex or domestic servants, simply weren’t registering. And as a result, we now see them on Tier Two.

So the movement on the one hand of Chile up to Tier One because of the new law that they passed a few years ago and their very aggressive stance in enforcing that new law unfortunately then is kind of paired with the Colombian situation, where a bit of stagnation cannot keep a country on the highest level.

QUESTION: Thank you.

MR. RATHKE: Okay. Thanks. Next question, please.

OPERATOR: Our next question comes from the line of (inaudible) at US News and World. Please go ahead.

QUESTION: Hi. Thanks so much for taking the time to speak with us. I was wondering if you could talk a little bit more about Thailand’s downgrade, specifically the government’s shortcomings, considering all the media reports this last year or so discussing their human trafficking problem and why the government has failed to really address it.

AMBASSADOR CDEBACA: Well, as I said earlier – and I want to make it very clear that we know and we have worked with some very good actors in the Thai Government who are kind of on the front lines who are trying very hard to make a difference over there. But the widespread official complicity in human trafficking that continues to hinder their performance against sex trafficking and forced labor, the government as a whole did not demonstrate serious efforts to address that. It made few efforts to address forced labor and debt bondage among the most vulnerable communities – the foreign migrant workers, including in the fishing industry.

And even though we saw this notion of some better data collection and some – an uptick in investigations by the royal Thai police, those didn’t necessarily translate over into completed convictions. You’ll see in the report, for instance, a situation where some Burmese members of a conspiracy were arrested and ended up being sentenced to 30 years in prison for their role in trafficking men in the fish industry, and yet the Thai co-conspirator, who held 14 men in confinement as part of the slavery scheme, he ended up only getting three months as an alien smuggling conviction.

And so we’re looking at each of the cases that we know about. We’re looking at the situations on the ground to see – is this something that the bosses in the brothels and the bosses in the fishing packing sheds and things can simply brush off as business as usual? Is it something that they can bribe their way out of? Or is it something that has real teeth going forward? And we look forward to working with the Thais in the coming year to not only provide that real teeth, but hopefully achieve some real results.

MR. RATHKE: Okay. Thank you. Next question, please.

OPERATOR: All right. Our next question comes from Josh Stilts at Intrafish Media. Please go ahead.

QUESTION: Hi. Thanks again for hosting this. You said earlier that there were some 53 countries that have shown instances of slave labor or human trafficking in the fishing and seafood industries. Beyond Thailand, what other instances are you guys seeing?

AMBASSADOR CDEBACA: I think it’s actually 51. Sorry if —

QUESTION: Fifty-one, sure.

AMBASSADOR CDEBACA: — I misspoke. Well, we’ve seen, as far as a country that’s acting, the Indonesians have actually arrested some folks and there’s prosecutions going there. But there are some very nontraditional places. There – I don’t think a lot of people think of South Africa necessarily in this context, and yet the South Africans suddenly found themselves with a boatload of fishermen with – who had been basically shanghaied from Cambodia. We’ve seen in the Caribbean, in Trinidad and Tobago and Jamaica, situations where this has been discovered on the boats; Costa Rica on the west coast, finding Chinese fishermen in these dire straits; African men and African children on boats in the gulf off of the Green Coast and everything kind of ranging down from Liberia all the way down to Nigeria.

And I think that that’s one of the things that the more we look at this, the more we find this in surprising places. There were reports this last year by Stella Maris, the apostolate of the sea, which is the Vatican’s kind of specialized unit of – I call them the sea priests, who go out on the boats to try to mission to the fishermen. And at a conference that the Pope hosted in – earlier this year with those priests, suddenly there were reports coming out from the fishery in Scotland of abuses up there.

So I think it’s something that we’re hearing about. We’re hearing about it on inland fisheries such as Lake Victoria and Lake Volta, but we’re also hearing about it in the Baltics and in, as I said, places as unusual as Scotland or South Africa.

MR. RATHKE: Okay. Thanks. Next question please.

OPERATOR: Our next question comes from Maya Rhodan from the TIME magazine. Please go ahead.

QUESTION: Hi. Thanks again for the call. I have a question about the LGBT community and how – can you just speak to how instances of trafficking that involve LGBT people were factored into any of the rankings or if there are any countries where this is a particular issue or if there’s still more digging around that needs to be done on that?

AMBASSADOR CDEBACA: I’m very glad you raised that. It is something that we’re seeing more of. I think that it’s something that, because it’s been so taboo for a lot of countries to even admit that these communities are part of the social fabric, much less worthy of protection, that in some ways we’re just kind of opening the bidding on this issue. I think a lot of folks are aware of and know of issues of survival sex of the homeless kids who are in many ways trying to put together their own families and their own communities. But I think a lot of folks, whether it’s in the public health arenas or even in the LGBT activist communities, have tended to look at that and not see the pimps and the controllers that sometimes are behind that.

And we’re seeing in a number of countries around the world – I remember last year, when I was in Kenya, for instance, the interplay, the horrible interplay between on the one hand the effects of terrorism in the northeast and even in Somalia, with families trying to get their kids out of that area so that their sons don’t have to be fighters for Shabaab, and then they end up in sex trafficking down on the coast in the tourist zones. And I think it’s one of those things where, because of attitudes against the LGBT community, a lot of folks that were even working or willing to talk about other forms of trafficking were having a very hard time even wanting to admit that those young boys might have been in human trafficking situations.

And this happens in the United States. There was a case, I think it was last year, in the Atlanta area where a man was convicted for human trafficking of a teenaged American kid who, frankly, he lured in because of that kid’s loneliness and seeking to have some meaning as he struggled with his own sexuality.

So it’s something that we’re going to be looking at a lot more carefully. It’s like the fishing issues a few years ago, where we had just started to hear it, and then now that we’re looking for it, we’re seeing it in a lot of different places. I think that we’re going to be seeing more coverage of this in the coming years. And we’ve started having conversations with some of the key players in the United States, like the Human Rights Campaign and others, so that we can bring to bear the folks who are working in the affected communities.

MR. RATHKE: All right. I see – I think we have three questions remaining, so we will go through those, and then we will wrap up from here. So, operator, could you call the next question?

OPERATOR: All right. The next question comes from Jeanine Stewart at Undercurrent News. Please go ahead.

QUESTION: Thank you for having this, first of all. So first off, I’m wondering two things. How much has human – has the human trafficking problem grown in the fishing industry in 2013 over 2012? I’m just curious, is this a growing problem or is this just something that we’ve become more aware of with Thailand in the spotlight over it? And also, how much certainty is there in the investigation? Can you reveal anything about how they were conducted or how sure the State Department is that Thailand’s officials were complicit in some of the human trafficking that occurred? Because I – since I know that the Thai Government has said that’s not true. So how do we weed through the “he said, she said” on that one?

AMBASSADOR CDEBACA: Well, I think that what we’ve seen in – as far as complicity in Thailand is whether – it’s not just in fishing but in a number of different sectors, the very reputable researchers, whether it’s your Human Rights Watches, whether it’s Transparency and some of the other indices looking at corruption as an issue. But specifically, there’s I think been some very good reporting even by the media as opposed to by academic researchers or others as to the involvement of Thai officials. And that’s something that’s reflected in the narrative.

One of the things that’s also reflected in the narrative is then how the parts of the Royal Thai Government have responded to that type of reporting by journalists being charged with criminal defamation —

QUESTION: Mm-hmm.

AMBASSADOR CDEBACA: — journalists and the folks who are willing to reprint articles even being charged. So that notion of not only is there, we think, good and solid reporting by a number of different actors, whether it’s, again, activists, academics, or journalists, but also the work that’s being done increasingly now by the food industry itself. And we very much encourage the seafood industry to start looking at these supply chain issues. We know that they can trace their product from the store shelf all the way back to the particular boat. We’ve seen the bar codes on the tubs, the plastic tubs of shrimp in the packing shed that are required that if there’s a health outbreak, they can take it all the way back to the particular shed, take it all the way back to the particular boat.

So since we know that the shrimp and the fish is traceable in those instances, we think also that what the particular captains and what the labor brokers that are working with them are doing needs to be something that comes under the microscope for the companies and their consumers as well.

MR. RATHKE: Okay, our penultimate question please, operator.

OPERATOR: All right. Our next question comes from Dmitri Zlodorev from ITAR-TASS. Please go ahead.

QUESTION: Hello. My name is Dmitri Zlodorev. I am from ITAR-TASS news wire service of Russia. You placed Russia to the third group, and how you would characterize the U.S.-Russian cooperation in this area? And am I right that right now you are not plan to impose sanctions against Russia? Thank you.

AMBASSADOR CDEBACA: Thank you, Dmitri. We can’t speak to sanctions at this point in time. It’s something that the White House will be looking at for all of the countries on Tier Three, and so I can’t speculate as to what would happen on that. I think we had talked about that a little bit earlier as far as last year was concerned.

But your question as far as what kind of cooperation between the United States and Russia on this, we’ve had a – I think a good dialogue over the years on human trafficking with our Russian counterparts. And we’re looking forward to what we hope will be some efforts in the coming year. We know that the government submitted an anti-trafficking action plan to the National Security Council and at this point has not heard back. We think that that certainly would be a very good step, to have a public and transparent anti-trafficking action plan. And it would be a sign of political will on the part of the Russian Federation.

One thing that I would like to say as far as U.S.-Russian cooperation is that we have been able to continue to work together over the last year to announce a trafficking shelter in St. Petersburg with space contributed by the municipality – so Russian government funding – and support from the United States Embassy in Moscow. Now that shelter is only going to be able to hold and serve eight trafficking victims, and the scope of trafficking in Russia that’s pointed out in the report, with the migrant foreign workers and others, is many, many more than that. But we do feel that it’s a good step and that we hope that working together, the Russian Government and the United States Government and the Red Cross partners will be able to provide a better life to the women who are able to avail themselves of that shelter.

MR. RATHKE: Okay, thank you. Next question, please.

OPERATOR: Our next question comes from Teresa Busa from EFE. Please go ahead.

QUESTION: Thank you very much. I wanted to ask you about the specific case of Venezuela. I wonder if you could comment on that: how bad the situation is and what are the most worrying trends, and how is the U.S.-Venezuela cooperation in this area?

AMBASSADOR CDEBACA: Indeed. Well, thank you for your question. I think that we were – a few years ago, as you know, Venezuela was brought up off of Tier Three in recognition of a number of cases that they were investigating and what looked like a commitment to working jointly between the police and the health service. And unfortunately, this last year we just haven’t really been able to see those same type of efforts. There’s a little bit of awareness raising and tourism training, but unlike most of the countries in the world, there’s not an interagency coordinating council that’s been brought together around the issue. There’s not an action plan or even a draft action plan. There’s no formal mechanism to identify the victims, and there’s no shelters that are designated for trafficking victims. In many ways, it seems that all of the victim care in Venezuela is being done by the nongovernmental organizations or by the international organizations.

And so we call on Venezuela to step up and to be involved in the victim care. And there’s so little public data on law enforcement that it does not appear that there were any reported convictions in 2013, as opposed to in 2012, where at least we were able to identify one person convicted of sex trafficking.

So as with all of these countries, we very much want to continue to be able to work together on this. This is a shared problem. It affects Venezuela, it affects the United States, and it affects the Western Hemisphere. And so we’ll be looking for ways in which we can continue to try to engage with the Venezuelans.

MR. RATHKE: Operator, we would have time for one final question, if there are any in the queue.

OPERATOR: All right. We did have one final question from Matthew Russell Lee at Inner City Press. Please go ahead.

QUESTION: Sure. Thanks a lot, and thanks for taking the question. I was looking at Myanmar – Burma – and also at Sri Lanka. And in both cases, it seems to say – the report seems to say that that government is either, in the case of Burma, directly involved in trafficking in coercion; or in the case of Sri Lanka, suspected of complicity in it. So in those two cases, I wondered as the U.S. sort of re-engages with Myanmar or Burma, how does this issue get raised and how is it going to be resolved? And the same in the case of Sri Lanka where there’s this human rights inquiry. Is this – what can be done in terms of actual government complicity in trafficking?

AMBASSADOR CDEBACA: Well, it’s interesting. Let me start with Burma. We – this is one of the first things that we re-engaged on. I was in Burma within I think about three weeks or a month after Secretary Clinton took her first historic trip there, and when I met with Aung San Suu Kyi, one of the things that was very interesting to me was that she recommended to me that I needed to talk to her jailor. And I asked her, “What do you mean?” And she said, “The guy from the secret police who was assigned to me to be my warden all of these years would bring me articles on human trafficking off of the Internet, and we would talk into the night about how we would work together to help end human trafficking and slavery for our people if things ever changed.” A lot of people forget that she spent her Nobel Prize money while she was in prison. She sent it World Vision, an NGO, to provide food and shelter for about 200 Burmese trafficking victims in Thailand. The first place that she went after she was able to travel was to the shrimp-packing sheds in Thailand where so many Burmese are affected by this crime.

So it was interesting to see not only her, but then eventually what came true is the new head of the anti-trafficking unit – the central body against trafficking in persons for the Burmese Government in the new era – is the very person who she recommended to me that we should work with. He’s written a book on trafficking; he’s gone to other parts of the region. I think there’s a real desire on the part of the Burmese Government to engage and to bring on some of these modern approaches.

And to that end, they even passed a law abolishing the 1907 Villages and Towns Act, which is what gave them the legal ability to enslave their own people. So the notion of giving that up as part of the process of opening up to the outside world. I think that, as with every country, there’s a long way to go, and we’ll continue to work with them. We have an established and formal dialogue with them that was agreed to by both presidents during President Obama’s visit a year and a half ago, and it’s something that I’ve been to Burma for that dialogue and will be, I think, going again in the fall for the second round of that. So we’re – in that situation, I think that we’ve got a formal way to work with them.

Sri Lanka on the other hand, I think that that’s a bit of a work in progress. We don’t see – first of all, we’re not digging out of the years of exclusion from the international community that we had seen with the Burmese Government, but we’ve got this notion of three years in a row the trafficking statute that they have, which is a pretty good one – it prohibits all forms of trafficking, which not every SAARC country, not every country in the region has laws that prevent forced labor as well as sex trafficking – and yet three years in a row without any convictions, no services really for male trafficking victims, sex trafficking victims punished, and the folks who come home from overseas, no real way to screen for or help them the way that other source countries like the Indonesians and the Filipinos have.

So I think that there’s a long way to go, but they have this inter-ministerial structure that they have now adopted, and I think that for us both here in Washington and at the Embassy in Colombo it provides us some interlocutors who we hope that we’ll be able to work with going forward.

QUESTION: Just one follow-up on Burma. Do you see this issue of the Rohingyas, is it – does it make them susceptible to trafficking, this kind of stateless status? And how – do you have more – do you see this – do you see it through the light of trafficking, or is it a separate issue?

AMBASSADOR CDEBACA: Well, I think that we see with any displaced and vulnerable communities that are suffering from social exclusion, and I think that the plight of the Rohingyas has pretty been – has been pretty well documented. That is the type of population in which we often see in this type of situation.

Now, I mean, obviously, we remain concerned about all of the humanitarian issues that are around the Rohingya and other vulnerable ethnic and religious communities. We actually shed some – a little bit of light on this both in the Burma narrative but also, frankly, in the Thai narrative as we’re looking at the exploitation and even alleged sale of Rohingya refugees once they get to their destinations as they’re moving for all these different reasons.

QUESTION: Thanks a lot.

MR. RATHKE: Okay, thank you very much, participants. That’s the end of our question period. Want to thank Ambassador CdeBaca once again and thank you for your questions. A reminder this call is on the record but it is embargoed until the end of the Secretary – Secretary Kerry’s rollout event. Thanks once again, and we’re signing off here.

The Brussels G7 Summit Declaration

Brussels, Belgium – 5 June 2014

1. We, the Leaders of Canada, France, Germany, Italy, Japan, the United Kingdom, the United States, the President of the European Council and the President of the European Commission, met in Brussels on 4 and 5 June 2014. This Group came together because of shared beliefs and shared responsibilities. We are profoundly committed to the values of freedom and democracy, and their universality and to fostering peace and security. We believe in open economies, open societies and open governments, including respect for human rights and the rule of law, as the basis for lasting growth and stability. For nearly forty years, we have shown through our actions that collective will can be a powerful catalyst for progress. Our efforts to address major global challenges have also been guided by a commitment to transparency, accountability and partnership with other concerned members of the international community. We remain bound together as a group by these values and this vision. Guided by these shared values and principles, we will continue to work together to meet the challenges of our times. We thank the European Union for hosting this Summit and welcome Germany’s Presidency.

Global Economy

2. Supporting growth and jobs remains our top priority. The global economy has strengthened since we met at Lough Erne, downside risks remain which will need to be managed carefully. Advanced economies are recovering, but continued and sustained growth is needed to bring down unemployment, particularly among young people and the long-term unemployed.

3. We will take further steps to support strong, sustainable and balanced growth, with a common goal of increasing the resilience of our economies. We will present ambitious and comprehensive growth strategies at the G20 Summit in Brisbane, to include action across a broad front including in the areas of investment, small and medium enterprises, employment and participation of women, and trade and innovation, in addition to macroeconomic policies. We will continue to implement our fiscal strategies flexibly to take into account near-term economic conditions, so as to support economic growth and job creation, while putting debt as a share of GDP on a sustainable path.

4. We agreed that 2014 will be the year in which we focus on substantially completing key aspects of the core financial reforms that we undertook in response to the global financial crisis: building resilient financial institutions; ending too-big-to-fail; addressing shadow banking risks; and making derivatives markets safer. We remain committed to the agreed G20 roadmap for work on relevant shadow banking activities with clear deadlines and actions to progress rapidly towards strengthened and comprehensive oversight and regulation appropriate to the systemic risks posed. We will remain vigilant in the face of global risk and vulnerabilities. And we remain committed to tackling tax avoidance including through the G20/Organisation of Economic Cooperation and Development (OECD) Base Erosion and Profit Shifting Action Plan as set out in the agreed timetable, and tax evasion, where we look forward to the rapid implementation of the new single global standard for automatic exchange of tax information. We call on all jurisdictions to take similar action.

5. Trade and investment are key engines for jobs and growth. We reaffirm our commitment to keep our markets open and to fight all forms of protectionism including through standstill and rollback. We are committed to strengthening the rules-based multilateral trading system. We will protect and promote investment and maintain a level playing field for all investors. International standards for public export finance are crucial for avoiding or reducing distortions in global trade. Since we met at Lough Erne, we have made substantial progress on major trade negotiations: Canada-EU; Japan-EU; Canada-Japan; EU-US; the Trans-Pacific Partnership; and the Trade in Services Agreement. We aim to finalise them as soon as possible. We are committed to liberalising trade in environmental goods and services, including through an Environmental Goods agreement. We will work to conclude an expanded Information Technology Agreement as soon as possible. These agreements and initiatives can help support and will be consistent with the multilateral trading system and act as building blocks for future multilateral deals. We welcome the successful outcomes of the 9th World Trade Organisation (WTO) Ministerial Conference. We will prioritise full and swift implementation of the Bali Package, in particular the Trade Facilitation Agreement. We will continue to provide, within our current Aid for Trade commitments, substantial support and capacity building to help implement this agreement, in particular to the benefit of the Least Developed Countries. We fully support efforts in the WTO to secure swift agreement to a balanced work programme for completing the Doha Round.

Energy

6. The use of energy supplies as a means of political coercion or as a threat to security is unacceptable. The crisis in Ukraine makes plain that energy security must be at the centre of our collective agenda and requires a step change to our approach to diversifying energy supplies and modernising our energy infrastructure. Under the Rome G7 Energy Initiative, we will identify and implement concrete domestic policies by each of our governments separately and together, to build a more competitive, diversified, resilient and low-carbon energy system. This work will be based on the core principles agreed by our Ministers of Energy on May 5-6 2014, in Rome:

  • Development of flexible, transparent and competitive energy markets, including gas markets.
  • Diversification of energy fuels, sources and routes, and encouragement of indigenous sources of energy supply.
  • Reducing our greenhouse gas emissions, and accelerating the transition to a low carbon economy as a key contribution to sustainable energy security.
  • Enhancing energy efficiency in demand and supply, and demand response management.
  • Promoting deployment of clean and sustainable energy technologies and continued investment in research and innovation.
  • Improving energy systems resilience by promoting infrastructure modernization and supply and demand policies that help withstand systemic shocks.
  • Putting in place emergency response systems, including reserves and fuel substitution for importing countries, in case of major energy disruptions.

7. Based on these principles we will take the following immediate actions:

  • We will complement the efforts of the European Commission to develop emergency energy plans for winter 2014-2015 at a regional level.
  • Working with international organisations such as the International Energy Agency (IEA), the International Renewable Energy Agency, and the international financial institutions, we will supply technical assistance, including leveraging the private sector, and facilitate exchanges with Ukraine and other European countries seeking to develop indigenous hydrocarbon resources and renewable energies, as well as to improve energy efficiency.
  • We will conduct assessments of our energy security resilience and enhance our joint efforts, including on critical infrastructure, transit routes, supply chains and transport.
  • We will ask the IEA, in close cooperation with the European Commission, to present by the end of 2014 options for individual and collective actions of the G7 in the field of gas security.

8. We will also:

  • Promote the use of low carbon technologies (renewable energies, nuclear in the countries which opt to use it, and carbon capture and storage) including those which work as a base load energy source; and
  • Promote a more integrated Liquefied Natural Gas (LNG) market, including through new supplies, the development of transport infrastructures, storage capabilities, and LNG terminals, and further promotion of flexible gas markets, including relaxation of destination clauses and producer-consumer dialogue.

9. We ask our Energy Ministers to take forward this Rome G7 Energy Initiative and report back to us in 2015.

Climate Change

10. Urgent and concrete action is needed to address climate change, as set out in the Intergovernmental Panel on Climate Change’s Fifth Assessment Report. We therefore remain committed to low-carbon economies with a view to doing our part to limit effectively the increase in global temperature below 2°C above pre-industrial levels. We affirm our strong determination to adopt in 2015 a global agreement – a new protocol, another legal instrument or an agreed outcome with legal force under the convention applicable to all parties – that is ambitious, inclusive and reflects changing global circumstances. We will communicate our intended nationally determined contributions well in advance of the 21st session of the Conference of the Parties (COP21) in Paris (by the first quarter of 2015 by those Parties ready to do so) and call on others to follow our lead. We welcome the Climate Summit of the United Nations Secretary General in September and his invitation to all Parties to prepare for ambitious contributions and to deliver concrete action to reduce emissions and strengthen resilience. We look forward to a successful Summit.

11. We reaffirm our support for the Copenhagen Accord commitments to mobilise USD 100 billion per year by 2020 from a wide variety of sources, both public and private, to address the climate mitigation and adaptation needs of developing countries in the context of their meaningful and transparent mitigation actions. We welcome the adoption of the Green Climate Fund’s operating rules and the decision to commence its initial resource mobilisation in the coming months. We remain committed to the elimination of inefficient fossil fuel subsidies and continued discussions in the OECD on how export credits can contribute to our common goal to address climate change. We will strengthen efforts to improve measurement, reporting, verification and accounting of emissions and improve the reporting of international climate finance flows, consistent with agreed decisions of the United Nations Framework Convention on Climate Change. We will work together and with others to phase down the production and consumption of hydrofluorocarbons (HFC) under the Montreal Protocol. We will also continue to take action to promote the rapid deployment of climate-friendly and safe alternatives in motor vehicle air-conditioning and we will promote public procurement of climate-friendly HFC alternatives.

Development

12. The pursuit of sustainable and inclusive development and greater prosperity in all countries remains a foundational commitment that unites our people and our countries. We continue to implement the commitments we have made at previous Summits. To be accountable we will provide a report in 2015 on progress toward their attainment.

13. We commit to work with all partners to agree an ambitious and universal post-2015 agenda, anchored in a single set of clear and measurable goals. That agenda should complete unfinished business of the Millennium Development Goals. It should be centred on people and focused both on the eradication of extreme poverty, promoting development and on balancing the environmental, economic and social dimensions of sustainable development, including climate change. It should also promote peace and security, democratic governance, the rule of law, gender equality and human rights for all. We are committed to build a global partnership with shared responsibility and mutual accountability to ensure its implementation. We await the synthesis report of the United Nations Secretary General in the second half of 2014. We welcome the African Union’s common position.

14. We will continue to promote inclusive and resilient growth in Africa, working with governments and citizens in Africa to enhance governance and transparency, improve infrastructure, notably in the energy sector, eliminate trade barriers, facilitate trade and investment, and strengthen the responsible and sustainable management of natural resources and the revenues they generate. We welcome the active role of the African Union and the New Partnership for Africa’s Development in the process of reforming the Africa Partnership Forum.

15. Security and development are the prerequisite of a lasting peace in regions affected by the scourge of war, terrorism, organized crime, corruption, instability and poverty, notably the Sahel region, Somalia, Nigeria, South Sudan and Central African Republic. We welcome efforts by African partners and the African Union, supported by the international community, aimed at building their capacities to respond to crises and support stabilisation.

16. We confirm our strong commitment to the Deauville Partnership and our support to Arab countries in transition in their efforts to improve governance and stimulate inclusive growth and job creation, particularly for their youth and women. Our Foreign and Finance Ministers will meet in the margins of United Nations General Assembly, and the International Monetary Fund/World Bank Annual Meetings, to take forward the Partnership.

17. We remain committed to work towards common global standards that raise extractives transparency, which ensure disclosure of companies’ payments to all governments. We welcome the progress made among G7 members to implement quickly such standards. These global standards should continue to move towards project-level reporting. Those governments that are signing up to the Extractive Industries Transparency Initiative standard will voluntarily report their revenues. We confirm our commitment to implement fully the extractive partnerships launched in 2013.

18. We today announce a new initiative on Strengthening Assistance for Complex Contract Negotiations (CONNEX) to provide developing country partners with extended and concrete expertise for negotiating complex commercial contracts, focusing initially on the extractives sector, and working with existing fora and facilities to avoid duplication, to be launched in New York in June and to deliver improvements by our next meeting, including as a first step a central resource hub that brings together information and guidance.

19. We will continue to work to tackle tax evasion and illicit flows of finance, including by supporting developing countries to strengthen their tax base and help create stable and sustainable states. We renew our commitment to deny safe haven to the proceeds of corruption, and to the recovery and return of stolen assets. We remain committed to prevent the misuse of companies and other legal arrangements such as trusts to hide financial flows stemming from corruption, tax evasion, money laundering, and other crimes, ensuring that beneficial ownership information is available in a timely fashion to financial intelligence units, tax collection and law enforcement agencies, for example through central registries or other appropriate mechanisms, leading by example in implementing the Financial Action Task Force and other relevant international standards and our national action plans in line with the principles we agreed at Lough Erne. Greater transparency in this area will help developing countries.

20. Recent events illustrate that corruption undermines trust in governments and limits economic growth. We will build on existing efforts, including in the G20, to take additional steps to prevent this. We continue our engagement to and support of United Nations Office on Drugs and Crime and the World Bank’s Stolen Asset Recovery Initiative. We welcome the outcomes of the Ukraine Forum on Asset Recovery and look forward to the third Arab Forum on Asset Recovery. The G7 remains committed to working with governments and global financial centres to follow up on asset recovery efforts.

21. We remain committed to the Muskoka Initiative on maternal, newborn and child health, and welcome the call made at the Saving Every Woman, Every Child Summit in Toronto to accelerate progress on this global priority. In addition we are committed to ensuring sexual and reproductive health and reproductive rights, and ending child, early and forced marriage and female genital mutilation and other harmful practices. The health and well-being of women and children are improved through ensuring universal access to affordable, quality, essential health services, strengthening health, education and child protection systems and improving nutrition and access to immunisation. We recognise the impact of the GAVI Alliance (Global Alliance for Vaccines and Immunisation) and welcome its efforts to expand access to vaccines to an additional 300 million children during 2016-2020. We welcome Germany’s offer to host the second replenishment in early 2015, reaffirm our commitment, and call on other public and private donors to contribute to the replenishment of the GAVI Alliance. We reaffirm our commitment to an AIDS free generation and to the Global Fund to fight AIDS, Tuberculosis and Malaria to reduce the burden of these three major infectious diseases on eligible countries and regions.

22. To address the threat posed by infectious diseases, we support the Global Health Security Agenda and commit to working with partner countries to strengthen compliance with the World Health Organisation’s (WHO) International Health Regulations and enhance health security around the world. We commit to working across sectors to prevent, detect and respond to infectious diseases, whether naturally occurring, accidental, or the result of a deliberate act by a state or non-state actor. That includes building global capacity so that we are better prepared for threats such as the recent Ebola outbreak in West Africa and working together, in close cooperation with WHO, to develop a Global Action Plan on antimicrobial resistance.

23. We continue to strongly support comprehensive approaches to achieve global food security and nutrition. We look forward to the second International Conference on Nutrition in November 2014 and the Expo Milan 2015, which will provide a platform for the global post-2015 debate on sustainability and food and nutrition security. We continue to support the New Alliance for Food Security and Nutrition under strong African leadership and the successful completion of principles for responsible agricultural investment by the Committee on World Food Security. These will better enable smallholder farmers, especially women, to benefit from sustainable rural development. We continue to support the consistent implementation of the Voluntary Guidelines on Responsible Governance of Tenure of Land, Fisheries and Forests, including by building on the land partnerships we launched in 2013 and the Global Agriculture and Food Security Programme.

Ukraine

24. We welcome the successful conduct under difficult circumstances of the election in Ukraine on 25 May. The strong voter turnout underlined the determination of Ukraine’s citizens to determine the future of their country. We welcome Petro Poroshenko as the President-elect of Ukraine and commend him for reaching out to all the people of Ukraine.

25. In the face of unacceptable interference in Ukraine’s sovereign affairs by the Russian Federation, we stand by the Ukrainian government and people. We call upon the illegal armed groups to disarm. We encourage the Ukrainian authorities to maintain a measured approach in pursuing operations to restore law and order. We fully support the substantial contribution made by the Organisation for Security Cooperation in Europe (OSCE) to the de-escalation of the crisis through the Special Monitoring Mission and other OSCE instruments. We commend the willingness of the Ukrainian authorities to continue the national dialogue in an inclusive manner. We welcome the “Memorandum of Peace and Unity” adopted by the Verkhovna Rada on 20 May and express the wish that it can be implemented rapidly. We also encourage the Ukrainian parliament and the Government of Ukraine to continue to pursue constitutional reform in order to provide a framework for deepening and strengthening democracy and accommodating the rights and aspirations of all people in all regions of Ukraine.

26. The G7 are committed to continuing to work with Ukraine to support its economic development, sovereignty and territorial integrity. We encourage the fulfilment of Ukraine’s commitment to pursue the difficult reforms that will be crucial to support economic stability and unlock private sector-led growth. We welcome the decision of the International Monetary Fund (IMF) to approve a $17 billion programme for Ukraine, which will anchor other bilateral and multilateral assistance and loans, including around $18 billion foreseen to date from G7 partners. We welcome the swift disbursement of macro-economic support for Ukraine. We support an international donor coordination mechanism to ensure effective delivery of economic assistance and we welcome the EU’s intention to hold a high-level coordination meeting in Brussels. We welcome ongoing efforts to diversify Ukraine’s sources of gas, including through recent steps in the EU towards enabling reverse gas flow capacities and look forward to the successful conclusion of the talks, facilitated by the European Commission, on gas transit and supply from the Russian Federation to Ukraine.

27. We are united in condemning the Russian Federation’s continuing violation of the sovereignty and territorial integrity of Ukraine. Russia’s illegal annexation of Crimea, and actions to de-stabilise eastern Ukraine are unacceptable and must stop. These actions violate fundamental principles of international law and should be a concern for all nations. We urge the Russian Federation to recognise the results of the election, complete the withdrawal of its military forces on the border with Ukraine, stop the flow of weapons and militants across the border and to exercise its influence among armed separatists to lay down their weapons and renounce violence. We call on the Russian Federation to meet the commitments it made in the Geneva Joint Statement and cooperate with the government of Ukraine as it implements its plans for promoting peace, unity and reform.

28. We confirm the decision by G7 countries to impose sanctions on individuals and entities who have actively supported or implemented the violation of Ukraine’s sovereignty and territorial integrity and who are threatening the peace, security and stability of Ukraine. We are implementing a strict policy of non-recognition with respect to Crimea/Sevastopol, in line with UN General Assembly Resolution 68/262. We stand ready to intensify targeted sanctions and to implement significant additional restrictive measures to impose further costs on Russia should events so require.

29. The projects funded by the donor community to convert the Chernobyl site into a stable and environmentally safe condition have reached an advanced stage of completion. While recognizing the complexity of these first of a kind projects, we call upon all concerned parties to make an additional effort to bring them to a satisfactory conclusion and call upon project parties to keep costs under control. This remains a high priority for us.

Syria

30. We strongly condemn the Assad regime’s brutality which drives a conflict that has killed more than 160,000 people and left 9.3 million in need of humanitarian assistance. We denounce the 3 June sham presidential election: there is no future for Assad in Syria. We again endorse the Geneva Communiqué, which calls for a transitional governing body exercising full executive powers and agreed by mutual consent, based on a vision for a united, inclusive and democratic Syria. We strongly condemn the violations of international humanitarian law and human rights and indiscriminate artillery shelling and aerial bombardment by the Syrian regime. There is evidence that extremist groups have also perpetrated grave human rights abuses. All those responsible for such abuses must be held to account. We welcome the commitment of the National Coalition and Free Syrian Army to uphold international law. We deplore Russia and China’s decision to veto the UN Security Council (UNSC) Resolution draft authorising referral to the International Criminal Court and demanding accountability for the serious and ongoing crimes committed in Syria.

31. We are committed to supporting the neighbouring countries bearing the burden of Syrian refugee inflows and deplore the failure to implement UNSC Resolution 2139 on humanitarian assistance. We urge all parties to the conflict to allow access to aid for all those in need, by the most direct routes, including across borders and conflict lines, and support further urgent action by the UNSC to that end. In our funding we decide to give particular support to humanitarian actors that can reach those most in need, including across borders. We call for the international community to meet the enormous funding needs of the UN appeals for Syria and its neighbours. We resolve to intensify our efforts to address the threat arising from foreign fighters travelling to Syria. We are deeply concerned by allegations of repeated chemical agent use and call on all parties in Syria to cooperate fully with the Organisation for the Prohibition of Chemical Weapons (OPCW) fact-finding mission. We call on Syria to comply with its obligations under UNSC Resolution 2118, decisions of the Executive Council of the OPCW and the Chemical Weapons Convention to ensure the swift removal of its remaining chemical stockpile for destruction, and to destroy its production facilities immediately and answer all questions regarding its declaration to the OPCW.

Libya

32. We reaffirm our support for a free, prosperous and democratic Libya which will play its role in promoting regional stability. We express serious concern at the recent violence and urge all Libyans to engage with the political process through peaceful and inclusive means, underpinned by respect for the rule of law. We urge continued and coordinated engagement by the international community to support the Libyan transition and efforts to promote political dialogue, in coordination with the UN and with the UN Support Mission in Libya fulfilling its mandate in that respect. We ask all in the international community to respect fully Libyan’s sovereignty and the principle of non-intervention in its affairs. In this framework, we commend the proposal of the High National Electoral Commission, endorsed by the General National Congress, to convene the elections on June 25. We emphasise the importance of these elections in restarting the political process and appreciate the vital work of the Constitution Drafting Assembly.

Mali and Central African Republic

33. We welcome the ceasefire signed on May 23 by the Malian Government and armed groups in the North of Mali, thanks to efforts by the African Union, through its Presidency, and the UN. We reaffirm our strong commitment to a political solution and to an inclusive dialogue process that must start without delay, as prescribed by the Ouagadougou agreement and UNSC decisions. We fully support the United Nation’s Multidimensional Integrated Stabilisation Mission in Mali efforts in stabilising the country and, with the commitment of neighbouring countries, including Algeria, Mauritania and the Economic Community of West African States, in working for a durable settlement respectful of the unity, territorial integrity and national sovereignty of Mali.

34. We commend the role played on the ground in the Central African Republic by the AU-led International Support Mission to the Central African Republic, together with the forces sent by France and the European Union, to support the transition and encourage the Transitional Authorities to take urgent concrete steps toward holding free, fair, transparent and inclusive elections. We fully support the UN efforts in the areas of security, reconciliation, preparation of the elections, and humanitarian assistance.

Iran

35. We reaffirm our strong commitment to a diplomatic resolution of the Iranian nuclear issue and welcome the efforts by the E3+3, led by High Representative Ashton, and Iran to negotiate a comprehensive solution that provides confidence in the exclusively peaceful nature of Iran’s nuclear programme. We underline the importance of the continuing effective implementation by the E3+3 and Iran of the Joint Plan of Action. We call on Iran to cooperate fully with the International Atomic Energy Agency on verification of Iran’s nuclear activities and to resolve all outstanding issues, including, critically, those relating to possible military dimensions. We strongly urge Iran to fully respect its human rights obligations. We call on Iran to play a more constructive role in supporting regional security, in particular in Syria, and to reject all acts of terrorism and terrorist groups.

North Korea

36. We strongly condemn North Korea’s continued development of its nuclear and ballistic missile programmes. We urge North Korea to abandon all nuclear weapons and existing nuclear and ballistic missile programmes and to comply fully with its obligations under relevant UNSC resolutions and commitments under the September 2005 Joint Statement of the Six-Party Talks. We call on the international community to implement fully UN sanctions. We reiterate our grave concerns over the ongoing systematic, widespread and gross human rights violations in North Korea documented in the report of the UN Commission of Inquiry, and urge North Korea to take immediate steps to address these violations, including on the abductions issue, and cooperate fully with all relevant UN bodies. We continue to work to advance accountability for North Korea’s serious human rights violations.

Middle East Peace Process

37. We fully support the United States’ efforts to secure a negotiated two-state solution. We regret that greater progress has not been made by the parties and urge them to find the common ground and political strength needed to resume the process. A negotiated two-state solution remains the only way to resolve the conflict. We call on both sides to exercise maximum restraint and to avoid any unilateral action which may further undermine peace efforts and affect the viability of a two-state solution.

Afghanistan

38. We renew our long-term commitment to a democratic, sovereign, and unified Afghanistan and our enduring partnership with the Government of Afghanistan based on the principles of mutual respect and mutual accountability. The first round of presidential elections and the provincial council elections marked a historic achievement, especially for the more than 2.5 million women who voted, and we look forward to the completion of the electoral process. We continue to assist the Government of Afghanistan to strengthen their institutions of governance, reduce corruption, combat terrorism, support economic growth, and counter narcotics. We continue to actively support an inclusive Afghan-led and Afghan-owned process of reconciliation.

Maritime Navigation and Aviation

39. We reaffirm the importance of maintaining a maritime order based upon the universally-agreed principles of international law. We remain committed to international cooperation to combat piracy and other maritime crime, consistent with international law and internationally recognised principles of jurisdiction in international waters. We are deeply concerned by tensions in the East and South China Sea. We oppose any unilateral attempt by any party to assert its territorial or maritime claims through the use of intimidation, coercion or force. We call on all parties to clarify and pursue their territorial and maritime claims in accordance with international law. We support the rights of claimants to seek peaceful resolution of disputes in accordance with international law, including through legal dispute settlement mechanisms. We also support confidence-building measures. We underscore the importance of the freedom of navigation and overflight and also the effective management of civil air traffic based on international law and International Civil Aviation Organization standards and practices.

Other issues

40. We reaffirm our commitment to the protection and promotion of all human rights and fundamental freedoms, including religious freedom, for all persons. We recognise the need to show unprecedented resolve to promote gender equality, to end all forms of discrimination and violence against women and girls, to end child, early and forced marriage and to promote full participation and empowerment of all women and girls. We look forward to the Global Summit to End Sexual Violence in Conflict taking place in London later this month.

41. We reiterate our condemnation of terrorism and our commitment to cooperate in all relevant fora to prevent and respond to terrorism effectively, and in a comprehensive manner, while respecting human rights and the rule of law. We condemn the kidnapping of hundreds of schoolgirls by Boko Haram as an unconscionable crime and intend do everything possible to support the Nigerian government to return these young women to their homes and to bring the perpetrators to justice.

42. We confirm that non-proliferation/disarmament issues remain a top priority and welcome the G7 Non-proliferation Directors Group statement issued today.