The U.S. and Its Neighbors: A Regional Overview

MR. ROMERO: Thank you very much. What I'd like to do, with your indulgence, would be to make an opening statement of about 15 minutes and talk a little bit about some of the things that have happened, some of the achievements in the hemisphere, U.S. relations in the hemisphere over the last several years, and then go into a little bit of some of the unfinished business, some of the things that will be coming up and some of the challenges ahead, certainly in terms of our efforts with many, many allies in the region -- a growing list of allies, by the way -- to strengthen democracy and constitutional order and protect human rights.

Certainly if you hearken back to a year ago in Ecuador, we believe that democratic institutions and the rule of law have been strengthened, and that was very much a hemispheric effort.

Events in Peru have done exceedingly -- turned out to be exceedingly democratic. And I think that there's absolutely no question that in Peru the dispatch of an OAS commission down there that was charged with not only stimulating dialogue among all the opposition groups in the government but to also report back to the General Assembly had an exceedingly salutary effect down there.

In Paraguay, our efforts to preserve democracy have turned out exceedingly well, in collaboration with the major players in the region, Argentina and Brazil. Paraguay is still on a democratic track, and there is some good prospect for reform, both political and economic, underway.

And certainly in Haiti, while most of us on a daily basis see the glass as half-empty as opposed to half-full, there has been progress on the democracy side and on the security side in Haiti, and I can get into the details of that a little bit later.

We've seen watershed elections in Mexico, and I believe that it is our view here in Washington that they hold a great promise and opportunity for continued reform and an acceleration, perhaps, of that reform in Mexico. Certainly the election of Vicente Fox -- and I was able to be there with the secretary of State during the inauguration -- has many Mexicans hoping for not only an acceleration of political and social reforms, but also a greater integration of the Mexican economy into the U.S. economy and the benefits that will ultimately accrue to Mexico and the United States.

Over the last several years we've instituted something called People to People, measures and contacts between the United States, average people in the United States and the Cuban people, in an effort to break through the isolation felt by the Cuban people. Remittances have been raised, charter flights, exchanges, much more travel, et cetera. And that has had a very salutary effect in Cuba.

Also in Cuba we've had resolutions over the last two years at the U.N. Commission on Human Rights in Geneva that have excoriated Fidel Castro's abysmal record on human rights and civil liberties. And we believe that that has also engendered a greater European involvement in pressing for human rights in Cuba.

Our bureau during this period of time devoted larger total funding levels to democracy programs than in any other region within the State Department for FY 2000. There's $91 million, or about 13 percent of the worldwide democracy promotion budget will be spent in our region. And along with that, let me add that we have a figure of about $7 million in support of new elections in Peru, which will help not only with the campaign, but also critically with both counts and casting of ballots, and the vote count and other things.

In terms of economic integration and expanded trade, humanitarian assistance, certainly all of you know that over the last several months we were able to get passage of CBI enhancement, what we call CBTPA, which will have a salutary effect in helping the Caribbean Basin countries mitigate the effects of free trade with particularly Mexico and Canada and helping them to keep particularly their textile industry intact and exporting into the United States.

FTAA negotiations are on track for 2005. Certainly the nine working groups are meeting on a regular basis. Great progress is being made, and we think that that progress will accelerate as we move towards the trade ministerial and also the Quebec summit in April.

It is obvious to all those, even the most casual observer, that NAFTA works and that it has resulted in burgeoning trade with Canada. There's about $1.2 billion in trade per day between Canada and the United States. It is our leading trading partner, and Mexico is number two. This trade is more than with the EU and with Japan and the United States.

Mexico, we were able to put together an adequate financial assistance package for the peso crisis. And the Mexican government and the country as a whole has responded exceedingly well and come back. The growth rate in Mexico is as high, if not the highest in the region, over the year 2000. And the expected downturn in the transition period between one administration to the next did not occur. And Mexico paid back the bailout in record time, earlier than expected.

Brazil and Argentina. The IMF and particularly our Department of Treasury and the State Department played an exceedingly positive role in being proactive and trying to mitigate and contain the effects of global financial crisis in '98 and '99. And there has been what I consider to be an exceedingly prompt response and adequate response on the part of the United States with respect to natural disasters in the region, particularly Hurricanes Georges and Mitch. The relief package was in excess of $621 million in 1998, and we continue to monitor the disbursement and use of that, and things seem to be going exceedingly well.

In terms of improved security, there has been a resolution of the Peru-Ecuador border dispute, something that many can argue went on for about 130 years, with the active support of Argentina, Brazil and Chile as guarantors or partners in that. Both President Mahuad and President Fujimori did statesmanlike work in bringing that resolution to closure.

In addition, on the security side, we've had what all of us in the United States have to consider is a seamless turnover of the Panama Canal. The canal is being run exceedingly efficiently and there are improvements that are being made to the canal that will enable more shipping to pass through. Suffice it to say that the Panamanian government is doing its part in running the canal in an exceedingly good way.

In terms of drugs -- and I've put that at the bottom of my first page because many of you write that our dialogue with the hemisphere is weighted so much in favor of counternarcotics -- but I think you can see from what I've sketched out here that counternarcotics, while very important, is only one facet.

But in terms of counternarcotics and counternarcotic strategy, we have been able to work very closely with the countries of the Netherlands, Aruba, Curacao, Ecuador and El Salvador to provide for facilities to track and monitor traffickers after our loss of access to Howard Air Force Base in Panama after that was turned over. And those operations are going exceedingly well, and improvements are being made to those places as we speak.

In addition, Bolivia and Peru collectively have experienced a 50 percent reduction in coca production. The Chaparre (ph) region, which was a major coca-producing area, is now coca-free. Colombia -- the Colombia supplemental, $1.3 billion, and a comprehensive strategy to make headway in addressing problems, particularly the explosion of coca cultivation in the Pucamayo (ph) region, but in a way that I can get into a little bit later on, but many of you already know, and that is to do this in a holistic, comprehensive way, which includes judicial reform, better respect for human rights, alternative development strategies, infrastructure strategies to put people to work, and a host of other things.

In terms of arms sales, many of you that have been around for a while, when we changed our policy towards the region, either read or perhaps even wrote yourself that this would lead to an arms race in the region. That has not occurred. Any analysis of the figures show that there continues to be drastic decreases in expenditure on arms in the region since we made that decision, and the trends continue.

Certainly Mexico and Canada, we've improved our relationships at the borders and elsewhere. We've encouraged greater Canadian activism in the hemisphere, and they have obviously been playing a much more activist role in defense of democracy, human rights and civil liberties, and also in the summit process, as you well know.

We established something that is quite unique, I think, in our relationship with Canada, something called CUSP, C-U-S-P, which stands for the Canada-U.S. Partnership. And it is an attempt by both of our governments to travel across the breadth and scope of this very large border that we have to meet with local stakeholders in the communities and in business and federal government representatives on both sides of the border and to determine how we can make that border more efficient in terms of the free flow of legitimate goods and people, 200 million crossings a year, and as I mentioned, $1.2 billion in trade per day.

And we needed to get out in front of what the expectations of our stakeholders on both sides of the border are. We have prepared a report. That report will be put on our Web site. And I think that it will provide a blueprint for the next administration on how best to manage that very important border.

We've also begun a process called the trilateral process where we have deepened consultations between Mexico, Canada and the United States on regional issues. Secretary Albright has been a prime mover behind that, with ex-Secretary Green (sp) of Mexico and Mr. Axworthy, ex-foreign minister in Canada. And I believe that that trilateral coordination will show great promise.

Much of what we've done has been not unilateral or even bilateral, but we have used a lot of multilateral levers and tools at our disposal to accomplish those things that I just mentioned. And in many, many ways, it has been -- the results have been exceedingly positive. There is a strong and growing regional consensus on democracy, and you've seen that consensus play out very well in places like Paraguay, Peru, Ecuador, Haiti and other places within the region.

We initiated and institutionalized the Summit of the Americas process, which is much more than trade, goes well beyond trade, and goes into many, many neighborhood issues that are on the social and political side.

We're developing close and consultive relationships with a cadre of hemispheric partners who are on the first line of defense as it relates to support for democracy and constitutional order. And that first line I would characterize as being the United States, Argentina, Brazil, Chile -- (inaudible) -- and Canada.

Certainly with respect to the multilateral approach that we have taken, we have done what we can to work very closely with the secretary general of the OAS, Cesar Gaviria, in strengthening the organization and having it evolve into a cutting-edge and much more effective organization as it relates to not just political reforms but also in coordination with the IDB in terms of adequate funding for democracy and a whole basket of social issues, to include education, et cetera.

The results are manifest. Right now the IDB spends more on democracy and social issues than it does on the typical cash transfer, balance of payments and large infrastructure projects than it ever has before. I think it's about 55 percent. Certainly the OAS role in promoting democracy in Peru and Haiti has been exceedingly important and has borne fruit.

There is a new mechanism, and we have, along with our allies in the region, empowered the secretary general of the OAS to have at his disposal a fund and a mechanism for what we call preventive diplomacy in defense of democracy, and that is the ability to be able to dispatch experts when countries enter into or before they enter into crisis periods.

There has been significant administrative and personnel reform at the OAS. The OAS role in implementation of the Summit of the Americas objectives has been manifest. There has been a press rapporteur which has been established for the first time in the history of the OAS, and something that I am very personally proud of, and that is what we call the multilateral evaluation mechanism, OAS (C-Cad?), on regional or hemispheric counternarcotics cooperation (by the?) unilateral certification.

The reports are being worked on. The United States will be evaluated, as will every other country in the hemisphere. This is exceedingly important. And I believe that that mechanism, the MEM, or the "Mem," together with consultations with Congress, hold great promise to, at a minimum, address our certification requirements that are written into law.

The OAS has played a significant role in helping to resolve border disputes. A couple come to mind -- Belize and Guatemala, Costa Rica and Nicaragua, Honduras and Nicaragua. And, of course, we've had direct engagement multilaterally with the Caribbean through what we call the Bridgetown summit process.

The challenges ahead. Certainly our relationships with the hemisphere and our partners in the hemisphere have never been stronger, I believe, than they are right now. There is a strong and growing regional consensus for democracy. But even more importantly, there is a sense of collaboration and partnership in this joint endeavor to strengthen institutions, government institutions in the hemisphere.

Certainly there are a number of democracies which remain vulnerable -- Peru, Ecuador, Paraguay and Haiti, to name a few. And they will need all the support that the hemisphere can muster. Certainly we have grown to understand, I think, a little bit more completely that democracies are much more than elections. Elections are exceedingly important. They are exceedingly important for steps in the march towards democracy.

But certainly strengthening democratic institutions, particularly the rule of law and judiciaries, is exceedingly important. Anti-corruption measures in government, efficiencies in government, modernizing the state, et cetera, go hand in hand with reducing obstacles to trade. And those are things that still remain to be done, particularly work in reforming the judiciaries in the region.

There are still several challenges posed by crime and corruption. Some of what was considered cottage-industry type crime years ago has become hemispheric, if not global. I refer to money laundering, alien smuggling. Certainly counternarcotics would fall into that category, and then even some more informal phenomena like the nexus between youth gangs in Los Angeles and their counterparts in Central America, particularly in places like El Salvador.

Haiti remains a big challenge. President-elect Aristide has made commitments, in a letter to the president, eight commitments involving his commitments to further democratize and to provide political space for the opposition. We will hold him accountable to those commitments.

Certainly the elections in Peru are not a foregone conclusion. I visited Peru a couple of months ago. I was very impressed by the candor, seriousness of purpose of the opposition. Certainly President Paniagua, in his few weeks as president, interim president, has done a terrific job. He impressed me as a person who is singularly focused in delivering Peru to an elected president in July, holding credible elections before then in April, and delivering the country in as good a shape as he possibly can before then.

Certainly Colombia and the enormous tasks before the Colombian government and its friends and supporters worldwide are an increasing challenge and one that will require sustainability in terms of not just the government of Colombia's policies, but also its allies, and (I'd?) count the United States as first and foremost among them.

This is a long-term project. While there is already some achievements that have been made over the last several weeks, particularly spraying operations in the area where we've seen coca virtually explode by way of cultivation -- over the last three to four weeks, the Colombian government by Saturday will have sprayed over 20,000 hectares, which is very significant.

There have, in addition to that, been offers of alternative development and other kinds of benefits, particularly employment on infrastructure projects and training, et cetera, by small farmers in the Putomayo-Pequita (ph) area. We have a commitment already of 10,000 hectares to be eradicated over the next several months by small farmers in that area.

Most of the 20,000 hectares, which represents about a third of the illicit cultivation in the Putomayo province, has had a manifest effect in cutting into that illicit crop. And there has been a good response, at least a good initial response, on the part of the small farmers to take the government's offers on alternative development strategies and manually eradicating their crops.

We are still in the process -- a team is coming back today -- we're still in the process of negotiating a bilateral free trade agreement with Chile. We had a series of good meetings in Santiago over the last week. Our team is returning. Our hope is that those negotiations conclude before the Quebec summit.

Certainly we have a number of challenges ahead, moving the Free Trade Area of the Americas among them, and, of course, the Quebec summit, establishing a hemispheric agenda or re-establishing a hemispheric agenda by virtue of our leadership meeting. All need to be further refined and nailed down.

But I think my sense, being as objective as I possibly can -- and I'm the least objective person, probably, in this room -- is that there has been enormous progress that we have made within the hemisphere with our allies over the last four years, but there are enormous possibilities and opportunities that remain.

Thank you very much.

MODERATOR: Please wait for a microphone and remember to identify your name and news organization.

Q Mr. Secretary, Ev Bauman (sp), El Universal, Caracas. You have conspicuously omitted any reference to Venezuela and the government of President Chavez, for which you have expressed considerable criticism in the past. Do you consider the Venezuelan situation to be an advance in democracy, satisfactory from a human rights point of view?

MR. ROMERO: Thank you, Ev. And I expected that question. Certainly I'm happy to talk about Venezuela. I think that we maintain a productive relationship with the government of Venezuela. There has been good cooperation on the counternarcotics side with the government of Venezuela and in several other areas. Certainly their policies on energy have helped in international fora, and I think we will continue to maintain a good dialogue.

There are things that we disagree with the Venezuelan government, and we will probably continue to disagree on them. But in general, I would characterize the relationship as a positive one. Certainly my comments speak for themselves. I have nothing to add to that. But I would say that, as a diplomat for almost a quarter of a century, we do not engage in speculation or exaggeration in the things that we do and say.

Q Hi. Pete Casper (sp) with Cuba Trader. I was wondering if you could talk expansively about some of the challenges you face with Cuba. How would you answer some of the criticism that State has dragged its feet on implementation of (weird?) things like Title IV, and if you have any advice for the incoming group on, you know, how best to handle that sticky issue.

MR. ROMERO: I think that certainly there are those who believe that there's been foot-dragging. These are enormously complicated issues that have to -- that involve certainly looking at evidence of claimants brought before us in terms of ownership of property. When exiles fled Cuba over 30 years ago, almost 40 years ago now, they were not handed titles to property as they were getting on their airplanes. And so sometimes it takes an exceedingly long time to sort through and to make determinations based on things that are less than the (full?) documentation that you'd hope to have, like land titles and that sort of thing.

Then when you sort through all of those kinds of things, you've got to look at the arrangements that are made by foreign companies in Cuba to operate certain establishments and whether those constitute a violation or whether they fall within the parameters of

Title III or Title IV. And all of that takes an exceedingly long time. I think we've done a good-faith effort, and we'll continue to do that, because Title IV is the law.

Q (Inaudible) -- from Diario, Quito, Ecuador. What are your views on how the implementation of the dollar in the last 10 months in Ecuador?

MR. ROMERO: Well, I think that there's absolutely no mistaking the fact that the events of a year ago in January were quite sobering, not just for the -- (inaudible) -- government which emerged from them, but also to the legislature, and particularly for the Ecuadorian people. And I believe that there has been good cooperation across a whole host of issues to try to change policies to such an extent that it would turn the economy around.

Certainly the contraction of the economy in '99 and the beginning of 2000 was a wakeup call on the part of all Ecuadorian leaders. I think that many measures were put in place, including dollarization, which has helped. Certainly the price of oil being as high as it has has given the government somewhat of a buffer. But they have stayed with the IMF program.

It is painful. It is difficult. It is hard. There is not a politician on the face of the earth that likes to do austerity. It makes them unpopular. But I believe that the benefits of what President Noboa (ph) and his team are doing will soon be realized and manifest in Ecuador. Certainly kicking out the subsidies or taking out the subsidies for gas and gasoline and diesel are very unpopular, but there have been some other compensating measures that they've put in in hopes of being able to mitigate the worst effects.

Obviously increasing the IVA (ph) is also going to be unpopular, but there is no way that Ecuador or any other country would get access to fresh capital, whether it be from the international financial institutions or from the international investment community, unless it balances or begins to balance its budget. And that's the bottom line.

Nobody will give you a loan on a house where you're reneging on current mortgage payments, bottom line. And I don't think there's anyone that understands that better than President Noboa, and he's taken some real courageous steps, I believe and we believe, to turn the country around. And I think, at the end of the year 2000, when all the numbers are in, you will see growth, albeit modest growth, in Ecuador. And I think that will prove that the country -- the economy has bottomed out and is on the way to recovery.

Q Mr. Romero --

MR. ROMERO: I can hear you.

Q Jim Cason (sp) from the newspaper La Jornada. How are you? In terms of next-phase issues on the counterdrug stuff, as you said, you offer one perspective. And I want to talk particularly about Mexico. What do you see as sort of the kinds of markers in counterdrug cooperation that you need to look at? State has sort of been leading the kind of defensive charge to avoid the criticisms around certification and has sort of won that battle, at least for the time being, and it doesn't look like that's going to be a problem.

So on the positive side, how do you deliver some progress on the counterdrug issue? And I'm thinking particularly, and I'm sure you're aware of them, that some of the law enforcement officials in your own government don't agree with the rosy scenarios about how well cooperation has gone with Mexico; and so if you could just point out one or two things that you'd like to see happen in the next year or so on this issue.

MR. ROMERO: You've got a couple of questions there. One is how well is Mexico doing, and then the other, I think, subliminal question was certification, how that factors into it.

Q (Off mike.)

MR. ROMERO: I think that there already exists a good relationship between President Fox and President-elect George Bush, and I believe there is every intention on both sides of the border to build upon that relationship. Certainly there will be a number of things upcoming that will provide a venue for that. They will have an encounter at the summit, if not before. And there is something exceedingly important that the secretary of State leads, and that is the binational commission, which is Cabinet members from both sides, that will be meeting in June.

In addition to that, President Fox has enumerated about 50 points, many of them on law enforcement counternarcotics, that he intends to pursue. He is an impressive individual with a strong game plan, but an even stronger commitment to get the job done.

Senator Gramm (Graham?) just came back from a visit to Mexico and said that, if I can paraphrase it correctly, that President Fox is one of the most impressive leaders he has seen in 28 years of public life. That is not a man who gives out accolades easily. And I think we share his optimism for reform efforts in the judiciary, law enforcement and elsewhere, particularly fighting corruption as the number one goal of his.

I think that in many respects, both governments will be very similar in terms of how much they can get done by virtue of how the cooperation will be between the executive branches and the legislative branches. And that remains to be seen. We would hope that for the Fox agenda and for what evolved into President-elect

Bush's agenda, particularly on the law enforcement side, that we do have strong bipartisan support in the United States; we would hope the same for President Fox in Mexico.

MODERATOR: We'll take two more questions in English and then switch to Spanish.

Q Mr. Romero, Sergio Gomez from El Tiempo -- (inaudible). Yesterday Senator John McCain expressed serious concerns about the so-called demilitarized zones in Colombia. He was especially concerned about the possibility of the government to extend a new zone to another guerrilla group. He talked about the abuses the FARC has committed. (And then?), after two years of observing this experiment, how would you evaluate the demilitarized zones? And would you feel comfortable with the extension of a demilitarized zone to another guerrilla group?

MR. ROMERO: First, Sergio, let me tell you that it is not the place of the United States government to issue public opinions about something that is very much a domestic issue. Certainly President Pastrana and his team will be sorting out whether they will renew the current despeje (ph), the safe haven zone, with the FARC, which will run out, I believe, by the end of January, by the end of this month. And he is fielding opinions from a good cross-section of the Colombian people.

Certainly, as it relates to the ELN, if indeed that negotiation prospers, there is a zone that will be created that does not appear to be under the same kind of parameters as the despeje (ph) for the FARC. This other despeje (ph) for the ELN that has been proposed will have monitors, will have a government presence, will be of short duration, limited duration, et cetera.

It will permit them to hold, as they would like, the ELN, a political convention with the idea of converting into a political force. That's all very positive. I don't see the conditions that have been negotiated with the ELN as that similar truly to what has gone on with the FARC. Certainly our interests revolve around counternarcotics, and there need to be mechanisms established both within the safe-haven zones and outside of the zones to ensure that they not become safe havens for cultivation, coca cultivation, or trafficking of illicit substances.

MODERATOR: This will be the last question in English.

Q Good afternoon, sir. Roy Santos (ph) with the BBC. On the Cuban front, Cuba has just been admitted by the (ASCP?) in the trading bloc. Do you see any ramifications as far as U.S. concerned with the way the trade is going to impact with those countries, as well as the U.S.?

And on the Haiti front, your colleagues in the incoming administration, specifically Mr. Zoellick (sp), has been very, very negative on whether or not it's been a fruitful outcome with respect to U.S. involvement (in helping?) Aristide. As a matter of fact, he's considered it a waste of U.S. resources. Do you consider -- how do you respond to his comments?

MR. ROMERO: On your first question, relative to the ASCP, the Lomay (sp) convention, et cetera, that was a decision that they made. We did not agree with it. We told them that we did not agree. We believe that there have been, over the years, certain democratic requirements that have been laid down that, for whatever reason, did not seem to be applied to Cuba. That having been said, I don't think that there was great unanimity within the EU in terms of Cuba, but that was a decision, obviously, that the EU made. We disagree.

In the case of Haiti, certainly there is absolutely no one in the United States government which is satisfied with the evolution, the very slow evolution of democracy in Haiti. I share Ambassador- designate Zoellick's concern about it. I would say that there have been some positive results that have come out of it. There is not the endemic political violence and assassination that there was several years ago. You've had a brutal military force demilitarized. You do have freedom of expression in Haiti, not without some intimidation, I'll grant you.

They have celebrated elections. Some of them have been flawed, but they have celebrated elections. The elections that were conducted in May had an exceedingly high voter turnout. We think that that was good. It shows animus among the electorate to vote. And quite frankly, there are not a raft of boats being built as we speak, nor are there rafters. And so, consequently, you've got to keep in mind that there have been some good things.

Now, that having been said, we are very dissatisfied with the level of intimidation. Particularly a couple of days ago, there was a -- (inaudible) -- affiliated organization that threatened the opposition in its attempts to proclaim an alternative government, et cetera. That is in no way in keeping with the most fundamental tenets of democracy and freedom of expression.

We issued a press statement yesterday that I'd like to reiterate. The United States notes with increasing concern the climate of intimidation which has escalated in recent days. We note with particular concern threatening statements directed at political leaders, community activists, journalists, and members of the business and religious communities, notably those made by TKL, Desanjeans (ph), DeBosco (ph) spokesman Paul Ramon (ph). We strongly condemn the use of such inflammatory and violent rhetoric. We welcome -- (inaudible) -- spokesman Yvonne Neptune's (ph) comments repudiating these statements. The United States calls upon all of Haiti's political leaders to engage each other in constructive dialogue and to work towards reconciliation.

Lastly, President-elect Aristide has agreed to eight principles, and I can provide you with a copy of those, but they essentially have to do with fundamental concerns that we have on law enforcement, corruption, counternarcotics, but even more importantly, on democracy, providing for the rule of law, looking at the flawed May 21 election results, and essentially providing a base, if you will, for the next couple of years as it relates to democracy and space for the opposition.

MODERATOR: Okay, now we have time for about three, maybe four questions in Spanish.

Q (In Spanish.)

MR. ROMERO: (In Spanish.)

Q (In Spanish.)

MR. ROMERO: (In Spanish.)

Q (Inaudible) -- from Argentina. This deal with Chile -- (inaudible) -- in '97. And it has -- I mean, Bolivia protested it. And there's also a lot of concern because of the missiles and Chile saying they won't accept the planes, the F-16s, unless the United States gives them (too?) the missiles, which is a technology that no one else has in the region. And I was wondering what you're going to do about it, if you're going to go ahead or if you're considering the possibility of handing over the missiles to them.

MR. ROMERO: We have made very clear what our policy is in the region. And to go back before 1997, our policy on aircraft, on the sale of aircraft, was a blanket no. It was a refusal. And what we decided, and I believe it was the correct decision, was that if we have hemispheric partners who are going to be supporting our view that democracy needed to be strengthened and hemispheric partners who are going to be not only partners on the democracy side but on the trade side through the FTAA and through bilateral trade agreements, that there's absolutely no reason why we should be treating Latin America differently than we treat the rest of the world.

And so we brought our policy into conformity with our global policy. And what does that mean? Basically what it means is that there is no automatic no when there's interest expressed in buying U.S. combat aircraft or other things; that we deal with it on a case- by-case basis, which is what we did in Chile.

We had several reviews and we decided to allow, in this case Lockheed, but there was also McDonnell-Douglas, to provide specs on their aircraft. The Chilean government has decided that they would like to enter into negotiations with Lockheed for an F-16. They're doing that now, as we speak. We will be delivering, if the negotiations are fruitful, an F-16, which is a state-of-the-art F-16. But it will not have -- the actual delivery of (Am-Ram?) missiles will not take place. They will be trained in it. They will have a package for it, but it will not take place, because our global policy is not to introduce new weapon systems into areas where they do not already exist.

Q (In Spanish.)

MR. ROMERO: (In Spanish.)

MODERATOR: We have time for a final question.

Q I have two. (Laughs.)

MR. ROMERO: No, sorry. Sorry.

Q I go with a follow-up of Maria, then. You say that you're not going to sell new technology to the region, that that's the policy in other countries, and that's why you're not going to sell the missiles with F-16s.

MR. ROMERO: No, you didn't get it.

Q (Inaudible.)

MR. ROMERO: It was new weapon systems. Technology, yes. No new weapon systems introduced into an area where there is not an equivalent weapon system of its kind. That's the policy.

Q Okay. So what do you (wait?), that another country asks for the same system?

MR. ROMERO: No. We would -- if, for example -- and I am not an expert in this stuff, okay? But if, for example, another country in the region was to import or to purchase a weapon system that was equivalent or more advanced, if there is such a thing, as the (Am- Ram?) system in this case, then we would consider the sale or the delivery of that system.

In other words, we do not want to contribute to an arms race, and so, consequently, if we were to approve the delivery of that system, that weapon system now, that missile now, then basically we would be ratcheting the weapons of the region, because then there would be a desire on the part of other countries, not simply just to modernize, which is what Chile is doing, but to achieve parity with that, or even go higher. And that's what we want to avoid.

MODERATOR: Thank you all very much.

MR. ROMERO: Thank you.

END

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