S. HRG. 106±340 FOREIGN OPERATIONS, EXPORT FINANCING, AND RELATED PROGRAMS APPROPRIATIONS FOR FISCAL YEAR 2000 HEARINGS BEFORE A SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE ONE HUNDRED SIXTH CONGRESS FIRST SESSION ON H.R. 2606, 3196, 3422/S. 1234 AN ACT MAKING APPROPRIATIONS FOR FOREIGN OPERATIONS, EXPORT FINANCING, AND RELATED PROGRAMS FOR THE FISCAL YEAR END- ING SEPTEMBER 30, 2000, AND FOR OTHER PURPOSES Agency for International Development Department of Justice Department of State Department of the Treasury Nondepartmental Witnesses Printed for the use of the Committee on Appropriations ( Available via the World Wide Web: http://www.access.gpo.gov/congress/senate U.S. GOVERNMENT PRINTING OFFICE 54±215 cc WASHINGTON : 2000 For sale by the U.S. Government Printing Office Superintendent of Documents, Congressional Sales Office, Washington, DC 20402 ISBN 0±16±060169±X COMMITTEE ON APPROPRIATIONS TED STEVENS, Alaska, Chairman THAD COCHRAN, Mississippi ROBERT C. BYRD, West Virginia ARLEN SPECTER, Pennsylvania DANIEL K. INOUYE, Hawaii PETE V. DOMENICI, New Mexico ERNEST F. HOLLINGS, South Carolina CHRISTOPHER S. BOND, Missouri PATRICK J. LEAHY, Vermont SLADE GORTON, Washington FRANK R. LAUTENBERG, New Jersey MITCH MCCONNELL, Kentucky TOM HARKIN, Iowa CONRAD BURNS, Montana BARBARA A. MIKULSKI, Maryland RICHARD C. SHELBY, Alabama HARRY REID, Nevada JUDD GREGG, New Hampshire HERB KOHL, Wisconsin ROBERT F. BENNETT, Utah PATTY MURRAY, Washington BEN NIGHTHORSE CAMPBELL, Colorado BYRON DORGAN, North Dakota LARRY CRAIG, Idaho DIANNE FEINSTEIN, California KAY BAILEY HUTCHISON, Texas RICHARD J. DURBIN, Illinois JON KYL, Arizona STEVEN J. CORTESE, Staff Director LISA SUTHERLAND, Deputy Staff Director JAMES H. ENGLISH, Minority Staff Director SUBCOMMITTEE ON FOREIGN OPERATIONS, EXPORT FINANCING, AND RELATED PROGRAMS MITCH McCONNELL, Kentucky, Chairman ARLEN SPECTER, Pennsylvania PATRICK J. LEAHY, Vermont JUDD GREGG, New Hampshire DANIEL K. INOUYE, Hawaii RICHARD C. SHELBY, Alabama FRANK R. LAUTENBERG, New Jersey ROBERT F. BENNETT, Utah TOM HARKIN, Iowa BEN NIGHTHORSE CAMPBELL, Colorado BARBARA A. MIKULSKI, Maryland CHRISTOPHER S. BOND, Missouri PATTY MURRAY, Washington TED STEVENS, Alaska ROBERT C. BYRD, West Virginia (Ex officio) (Ex officio) Professional Staff ROBIN CLEVELAND JENNIFER CHARTRAND TIM RIESER (Minority) (II) CONTENTS TUESDAY, MARCH 9, 1999 Page Department of State: Office of South Asian Affairs .............................................. 1 Nondepartmental witnesses .................................................................................... 31 THURSDAY, MARCH 25, 1999 Department of Justice ............................................................................................. 51 Department of State ................................................................................................ 51 Nondepartmental witnesses .................................................................................... 79 THURSDAY, APRIL 29, 1999 Agency for International Development .................................................................. 101 WEDNESDAY, MAY 19, 1999 Department of the Treasury: Office of the Secretary ........................................... 149 THURSDAY, MAY 20, 1999 Department of State: Office of the Secretary ........................................................ 181 Nondepartmental witnesses .................................................................................... 221 (III) FOREIGN OPERATIONS, EXPORT FINANCING, AND RELATED PROGRAMS APPROPRIA- TIONS FOR FISCAL YEAR 2000 TUESDAY, MARCH 9, 1999 U.S. SENATE, SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS, Washington, DC. The subcommittee met at 2:13 p.m., in room SD±192, Dirksen Senate Office Building, Hon. Mitch McConnell (chairman) pre- siding. Present: Senators McConnell, Bennett, Campbell, and Leahy. DEPARTMENT OF STATE OFFICE OF SOUTH ASIAN AFFAIRS STATEMENTS OF: HON. KARL F. INDERFURTH, ASSISTANT SECRETARY FOR SOUTH ASIAN AFFAIRS HON. JULIA TAFT, ASSISTANT SECRETARY FOR POPULATION, REF- UGEES, AND MIGRATION OPENING STATEMENT OF SENATOR MITCH MC CONNELL Senator MCCONNELL. Today's hearing will come to order. This is the first in a series of what I would characterize as some of the world's more, if not most, intractable problems. Over the next few months, I intend for the subcommittee to hold hearings on the linkages between U.S. assistance programs and our policies toward Afghanistan, North Korea, Iraq, the Palestinians, Russia, Indonesia, and Brazil. In each country we either indirectly or di- rectly provide some type of aid. The funding ranges from support for programs for refugees, such as the border efforts along Afghani- stan, to development and multilateral bank programs in Indonesia, Brazil, and Russia. While it is easy to provide anecdotal evidence that U.S. aid re- lieves human suffering and reduces poverty, at a time of rapidly di- minishing levels of foreign aid resources, the unfortunate reality that Senator Leahy and I oppose, but must live with, is the whole question of whether our aid is serving our interests, where and when it matters most. Just a few of the kinds of questions I hope to examine over the coming months include: Has our expenditure of over $75 million for oil for North Korea reduced the threat of military conflict or the menace of their nu- clear program? (1) 2 Is the congressional initiative to fund the opposition efforts to lib- erate Iraq achieving any results? Has our support of the IMF and World Bank programs promoted a stable, free market democracy or has it fed corruption in Russia? But today the questions will focus on Afghanistan. Several explosive issues fuse together in Afghanistan: narcotics trafficking, terrorism, regional military tensions, ethnic hostilities, refugee pressures, and internal civil and human rights abuses. Central to the solution of each of these problems and the promotion of our interests is the establishment of a viable, stable representa- tive government, something that Afghan people have not enjoyed for decades. While there is a school of thought that argues the Taliban has delivered peaceful relief from years of Soviet occupa- tion and mujahedin factional fighting, conditions are neither pros- perous nor improved for most Afghanis today. Kandahar is a long, long distance from Kentucky, and no doubt many will ask why we should bother with a hearing, aid, or any measure of policy interest. The answer is simple: Afghanistan is the second largest producer of opium for heroin which makes its way onto U.S. streets; 220 people, including 12 Americans, died in savage bomb blasts that the administration blames on the Osama bin Laden organization, afforded honorary guest protection by the Taliban. Continued armed clashes between Iran's military and the Taliban risk a wider war, drawing in Pakistan, Russia, and Uzbekistan. Pakistan has provided safe haven to over 800,000 refugees, straining Islamabad's limited economic resources and political sta- bility, facts which ripple through the nuclear dynamic with India. And finally, central to today's hearings, we all have mothers. Many have wives and sisters, and in their names in our common interests, we must address the Taliban's harsh, systematic denial to girls and women of health care, education, employment, and the most basic of rights. The status and treatment of women by the Taliban is not simply a matter of our cultural insensitivities as some would argue. In fact, lives are at stake. Women are beaten for appearing in public without a male relative or failing to wear the suffocating veils of the burqua. I was stunned to read that wearing white socks with the burqua risks a public beating because they are viewed as inappropriate and sexually provocative. And it is not just lives at stake. An entire generation of children is at risk. Until 1996, 70 percent of Afghanistan's teachers were women. Most are now banned from the profession and public schools remain closed, depriving all school age children of an edu- cation, girls and boys alike. Afghanistan is being dragged back into the dark ages, a time when women were chattel, literacy was a luxury, and sorcery sub- stituted for sound medicine and health care. Children died of colds and measles then as they do now in Kabul. Far too many women died in childbirth, victims of ignorance, as they do now in Kandahar. The Taliban's war against the remnants of the mujahedin, com- bined with international isolation, compound the economic suf- 3 fering. Yet, as depressing as conditions are, I do not think the situ- ation is hopeless. In fact, I think there is a unique convergence of international interests which could compel strong action to produce a settlement of the internal conflict and an agenda to protect the rights and interests of all Afghans. Ironically after fighting a proxy war for a decade, the United States and Russia now share an interest in containing the influ- ence of the Taliban's virulent form of Islamic fundamentalism. The Russians have obvious concerns about the Taliban's capacity to de- stabilize Central Asian states on their border. Russian support for the mujahedin, our former clients and the Taliban's only opposi- tion, may also stem from an interest in limiting the development of alternative and competitive pipelines through Afghanistan. I understand we have engaged in a United Nations effort de- signed to produce a settlement which involves six key regional na- tions plus the United States and Russia. Given our interests, I