U.S. Dep. Sec. of State John Negroponte on U.S.-Asia Ties, September 17, 2008

John D. Negroponte, Deputy Secretary of State
As Prepared For Delivery
Hong Kong
September 17, 2008

Thank you, Steve. I'm thrilled to be back in Hong Kong, where I began my Foreign Service career more than 47 years ago. This city is a symbol of Asia's dynamism and potential, and I want to congratulate Hong Kong for successfully hosting the 2008 Olympic equestrian events last month. I'd also like to recognize our new Consul General, Joe Donovan, a diplomat with the expertise and experience to continue strengthening the U.S.-Hong Kong relationship.

The United States has been a Pacific power for much of its history. Indeed, our relations with Asia began not far from here when, not even a decade after our country's birth, an American merchant ship first docked in the port of Guangzhou. And in 1833--175 years ago--we signed our first treaty of friendship with an Asian power, Thailand.

In the course of my own career, and certainly in the course of American history, our presence as a Pacific power has taken many shapes. But in 1961, when I arrived in Hong Kong, and throughout that decade, when I was working on Vietnam policy, I could not have imagined the extraordinary transformation Asia would undergo in the coming decades. As President Bush noted last month in Bangkok, "Asia has gone from an area mired in poverty and recovering from world war to a thriving and dynamic region." Asia has avoided military conflict for nearly three decades, and relations among its major powers have never been better. Nearly all of Asia's economies are market-based, and robust democratic systems are flourishing throughout the region. The 21 APEC economies now account for 60 percent of global GDP and half of global trade. All of this makes Asia a key component of a rapidly globalizing world. And so, America's status as a Pacific power has never been more important than it is today.

Those of us fortunate enough to witness Asia's transformation know that it was neither inevitable nor accidental. Asians, who recognize the value of education and hard work, deserve primary credit for their region's accomplishment. But Asia prospered thanks also to a broader international economic and security order sustained by American leadership. For 60 years, the U.S. presence in Asia has had a calming effect on relations among the region's major powers. Our military alliances with like-minded Asian partners have allowed many of the region's powers to trade in their swords for ploughs and harvest the gains of global trade. Our alliances with Japan, Korea, Australia, the Philippines, and Thailand remain the foundation of peace and security in Asia.

Over the last few years, the United States has reinvigorated those alliances while also reaching out to new friends in Southeast Asia. We have a growing partnership with Indonesia, the world's largest Muslim-majority nation, which has made a remarkable transition to democracy in recent years. To help cement Indonesia's success, the U.S. has pledged over $200 million in 2008 to support civic, governance, and educational institutions there.

Our relationship with Vietnam has also entered a new chapter, symbolized by President Bush's visit to Vietnam in 2006 and the visit by Vietnamese Prime Minister Nguyen Tan Dung to Washington in June. Last week I traveled to Hanoi and Ho Chi Minh City and saw firsthand the country's transformation from when I worked in Saigon in the 1960s. The United States and Vietnam now enjoy significant and growing trade and economic ties; an emerging military-to-military relationship; successful cooperation on health and development issues; and growing cultural and educational links. Vietnam's effort to integrate itself into the global economy has been an essential element in its remarkable growth over the last 15 years. We encourage Vietnam's leaders to continue those efforts, which have lifted millions of its citizens from poverty and opened up opportunities for Vietnamese and American businesses. Vietnam has followed a path to growth familiar to many of its successful neighbors: encouraging private enterprise, establishing legal institutions, and opening itself to global trade through membership in institutions like APEC and the WTO. We celebrate its people's rising prosperity. At the same time, we continue to urge Vietnam to strengthen its respect for human rights and religious freedom.

I also had the opportunity this week to visit Cambodia, a country with which our relations have been steadily improving in recent years. Cambodia is eager to overcome the tragic legacy of the Khmer Rouge, and as it works to strengthen democracy, improve public health, and increase respect for human rights, Cambodia can count on our support.

As in Vietnam, global trade and investment have transformed Hong Kong from the city I encountered when I first made the always exciting descent into Kai Tak airport in 1961. Hong Kong holds special importance for me as my first overseas posting, and I'd like to spend a minute on the past, present, and future of this remarkable city. Looking back on my time as Vice Consul, I can remember walking through the narrow streets of this densely packed city and being greeted, at every turn, by the enticing scents of delicious Chinese cuisine. U.S. Navy ships would harbor here regularly, granting a day of needed rest and relaxation to U.S. sailors and Marines serving in the Pacific. At that time, Hong Kong served as our window into China, and stories were coming out of the Mainland about the terrible famine years during the Great Leap Forward.

The images of Hong Kong I carry in my memory are only faintly recognizable in Hong Kong today, but one thing that hasn't changed is Hong Kong's embrace of the free market and of an open society, which have transformed it economically and socially. Together with a strong rule of law, an independent judiciary, a free and vibrant press, and respect for individual rights, the free market has allowed Hong Kong to thrive. Hong Kong's per capita income rocketed from 28 percent of Great Britain's in 1960 to 137 percent in 1996. Today, in terms of purchasing power, per capita income is roughly equal in Hong Kong and the United States. The "one country, two systems" framework has served Hong Kong well, allowing residents here the freedom to express their views publicly, peacefully, and without interference.

The United States has a strong interest in Hong Kong's continued success. U.S. companies have invested over $38 billion in Hong Kong, and Hong Kong is home to over 1,000 U.S. companies and 55,000 American citizens. We value this major economic relationship in its own right and as an important part of our economic integration with a booming Asia.

Freedom, competition, and individual choice are part of what makes Hong Kong so vibrant, and with that in mind, I'd like to congratulate Hong Kong on its recent successful Legislative Council elections. Although later than allowed for under the Basic Law, Hong Kong now has the opportunity to grant universal suffrage for election of the Chief Executive in 2017 and the LegCo in 2020. We hope that all parties will work together to find an effective path to universal suffrage that can be supported by the broad majority of people in Hong Kong. The United States will be closely following events here in the coming decade.

Over the past seven years, the Administration has focused great attention on building a strong relationship with a growing China--a goal that would benefit the people of Hong Kong, as well as mainland Chinese and Americans. China's rise stands out as an especially remarkable development, even against the background of Asia's extraordinary success. We want to see China integrated into East Asia and the global community as a responsible, constructive actor. This Administration has made good progress toward that goal, but the task will be the work of a generation.

We have established path-breaking bilateral mechanisms to expand cooperation and address concerns about the range of security, political, and economic issues facing our countries. The Strategic Economic Dialogue, led by Treasury Secretary Paulson, and my own Senior Dialogue with State Counselor Dai Bingguo are examples.

China agreed to abide by the norms of the global trading system by acceding to the World Trade Organization. We have benefitted from its accession: since 2001, China has been our fastest growing major export market. At the same time, when Chinese policies have violated WTO rules, we have held China accountable by filing WTO cases. As China deals with international trade regulations and other challenges of economic modernization, it can look to Hong Kong as a model of what's possible with free markets, foreign investment, and the rule of law.

Lastly, we have encouraged China to provide responsible global leadership on critical issues such as ending North Korea's nuclear program and stopping the bloodshed in Darfur. Our expectations are not always met, but by working together, we have challenged China to assume its responsibilities to strengthen the international system, with some success.

These steps have laid the foundation for China, as an aspiring global power, to move beyond a narrow conception of its national interests to a broader understanding that reflects its growing stake in the international system. The trend is in the right direction. Asia's rise, and especially China's, has also caused many to worry that U.S. influence in Asia would decline. These fears, I believe, are overblown. They ignore America's commitment to the Asia-Pacific region and underestimate our ability to pursue relations with every major Asian power, including China, in positive-sum terms.

It's also important to highlight how much Asia's powers have strengthened their relations with one another--and the role we've played in that process. As Asia's powers have increasingly interacted with one another through trade, travel, and other exchanges, new patterns of cooperation have emerged. Our effort to denuclearize the Korean Peninsula through the Six-Party Talks is a compelling example of cooperation among countries with historically tense, even hostile, relations. Although the process of denuclearization is far from complete, the Six-Party Talks demonstrate the potential for regional cooperation to complement our existing bilateral alliances.

The question facing all Pacific powers, including us, is how best to preserve and build on the gains from recent decades. As I said earlier, we firmly believe that our bilateral security alliances are and will remain the foundation of peace and stability in Asia. Those alliances are time-tested and reinforced by common interests and values. They have demonstrated their continued vitality by growing even stronger since the end of the Cold War. No one should doubt our unshakable commitment to our allies' security.

New regional organizations have the potential to complement our alliances and to help tackle region-wide issues, and the United States will remain open to their formation. We hope that, whatever regional architecture takes shape, it institutionalizes the conditions that have helped Asia attain its upward trajectory. Asia boomed within a framework of openness, U.S. engagement, and mutual security. Most Asian powers recognize this and support a form of open Asia-Pacific regionalism. The United States is a resident power in Asia, and we are a stakeholder in a regional order based on openness and cooperation.

I want to conclude by stressing that America's commitment to strong relations with the rising powers of Asia is bipartisan, and that our interests in the region are enduring. The United States is a Pacific nation, and our prosperity and security are increasingly tied to Asia's. Working closely with old allies and with new friends, we will continue to lead in a region that is growing in peace, prosperity, and freedom.

Released on September 17, 2008

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Question and Answer Session Hosted by the American Chamber of Commerce in Hong Kong

John D. Negroponte, Deputy Secretary of State
J.W. Marriott Hotel
Hong Kong
September 17, 2008

AMCHAM CHAIRMAN STEVE DEKREY: Thank you, Ambassador. We appreciate your reassuring words, especially your continued confidence in Hong Kong.

At this point we welcome your questions. I will invite you to stand, give your name and connection, and then we’ll try to make sure we cover the room.

QUESTION: Hi Mr. Ambassador, Mary Kissel from the Wall Street Journal editorial page.

One of the threats to security in Asia was in a country that you didn’t mention, which is Pakistan. We’ve had some conflicting signals out of the government there. You’ve been closely involved. I wondered if you can comment on the conflicting messages we’ve been getting out of Istanbul.

DEPUTY SECRETARY NEGROPONTE: My remarks were limited to our policies towards East Asia and the Pacific, but I’d be happy to talk a little bit about Pakistan because you quite rightly point out that it’s a very important relationship. There are very important interests in the South Asia sub-continent. The war in Afghanistan, the issues of dealing with militant extremism in Pakistan, and above all the nexus, if you will, between the situation in Pakistan and in Afghanistan because of the so-called federally administered tribal areas in the border area.

Pakistan, as you know, is going through a political transition at the moment which hopefully things will begin to stabilize in that regard going forward, and there have been issues about the degree to which Pakistan has been able or not been able to control the border region, the region bordering on Afghanistan, which of course is not only of importance to the stability of Afghanistan, but also directly relevant to the security of our own forces that operate in Afghanistan.

So I’d say that looking to the future what we want to do is work more collaboratively with the government of Pakistan to see what we can do together on a collaborative basis to try and improve the security situation in that border region. Unilateral actions are probably not a durable or a viable solution over a prolonged period of time and I think the best way forward for both of our countries is to try to deal with the situation in that border area on a cooperative basis -- cooperative both between the United States and Pakistan, but also with the country of Afghanistan. So I would say trilateral cooperation, if you will, is probably the best way forward.

QUESTION: My name is Shusi (phonetic). I’m a novelist. I’d like you to comment on Taiwan, a country you didn’t mention.

VOICE: Is this for your next novel? [Laughter].

DEPUTY SECRETARY NEGROPONTE: Some comments on Taiwan. Well, I think probably the most important thing I would say is that like others, we are committed to the peaceful resolution of any differences which may exist across the Taiwan Strait. So I’d say that we’re encouraged by the advent of a new government in Taiwan and the fact that since that government took office there have begun to be some talks between the authorities in Beijing and the authorities from Taipei. We think that is to the good.

We remain, as you probably know, committed to a one China policy but at the same time we are committed to the peaceful resolution of whatever differences may exist across the straits. We are also under our own Taiwan Relations Act committed to the defense of Taiwan.

QUESTION: Mark Michaelson from APCO Worldwide.

You mentioned the WTO briefly and some other organizations. Obviously the Doha Round has not been going particularly well. In fact a lot of these organizations have been under attack across the world, of course within our own Congress and other places. Is this a symptom of the situation going forward? Are multilateral organizations like the WTO going to be less effective in the future? Or do you think this is going to be something we can overcome? It seems like the focus now is on bilateralism and settling specific issues that way in many areas, especially on the economic front.

DEPUTY SECRETARY NEGROPONTE: I think sometimes people underestimate – particularly when it comes to heated political rhetoric – people underestimate the value that international organizations can provide to the individual member states of the international community. Having served as Ambassador to the United Nations I can personally testify to that, because the UN does a lot of extremely useful things and yet it’s popular in some quarters and at some times to bash the United Nations. So I would certainly say the same thing for the international trading system, for the WTO. After all, it’s proven to be a very convenient vehicle for getting various countries, not the least of which has been China, committed to policies of openness and transparency that might otherwise have been more difficult to achieve.

So I think the WTO can be a very convenient and useful, and is a very convenient and useful, organization.

As far as the Doha Round is concerned, there’s no question that it’s run into some choppy waters, but I don’t think we’ve completely – in fact I know that we’ve not completely abandoned the hope – that the Doha Round might be successfully concluded, although it’s looking more and more problematic that such a conclusion could occur before the end of this particular U.S. administration.

I might just say lastly, in regard to your question about WTO and free trade, is that we remain very committed to getting the pending free trade agreements that we’ve already negotiated and which are lying before our Congress, we remain committed to getting them ratified. And to this part of the world of course, the free trade agreement we’ve negotiated with South Korea is extremely important, not only for its implications for our economic relationship with South Korea, but for the potential onward effects that it could have in influencing perhaps other countries to be interested in similar arrangements as well.

QUESTION: Mr. Secretary, my name is Andrew Lo. I’m a private investor in real estate.

As I understand, before you came here you went to see Chief Executive Donald Tsang, and you also talked about the timetable for the Hong Kong universal suffrage. Is that [for] the CE, not in 2012, or in the direct election of all the legislators in 2020, or that long (sic). But I believe the Hong Kong people demand universal suffrage ASAP. I wanted to ask you in your capacity, how can you help the Hong Kong people to achieve this dream?

DEPUTY SECRETARY NEGROPONTE: Well, as I said in my remarks, we support that objective and we’re strong supporters of Hong Kong and the “[One Country,]Two Systems” model. We think it’s important. We think the rule of law is important here. We think democratic freedoms are important. The fact that you have a vibrant and free press and expression. We think these are all factors that have contributed to the extraordinary accomplishments of this city.

But as far as the specifics are concerned and how universal suffrage is going to be actually achieved, I think that’s part of the dynamic that’s going to have to take place here in Hong Kong itself and in its relations with China.

But we certainly favor and support the idea of upholding democracy and democratic principles for this city as much as possible, and we think it’s in the self-interest of Hong Kong and we think it’s in the self-interest of China to respect that.

QUESTION: Nicholas Ambre of the New York law firm Sullivan & Cromwell.

I was wondering if you could comment on the recent events in North Korea and how they may impact the hoped-for denuclearization of North Korea.

DEPUTY SECRETARY NEGROPONTE: That’s a very good question and I think of course North Korea is not the most transparent place. So one can never know with great certainty exactly what is happening there.

We are very committed to the 6-Party Talks. We’re very committed to the denuclearization of the Korean Peninsula, and we think a certain amount of progress has been achieved. We’ve had the initial destruction of some of their plutonium facilities, particularly the cooling tower. I think we’ve taken a significant step forward. But the next step we have submitted to the North Koreans a proposal for a verification regime for the denuclearization of the peninsula and the North Koreans have not yet responded.

So as has almost always been the case during the course of these negotiations, things always seem to take longer than we would initially hope. But we have not given up hope that we may sometime in the reasonably near future get a response from North Korea on a verification regime that would permit us to move this denuclearization process to the next level.

QUESTION: Hi, Mr. Ambassador. I’m Erin Fung from New York Life.

Certainly, as you mentioned in your speech as an engaged leader in the Pacific, the United States certainly has responsibilities in this region and we’ve fulfilled those responsibilities. What do we have to say now to our Asian partners in light of the recent titanic shifts in the financial services sector to ensure that there’s continued confidence in America?

DEPUTY SECRETARY NEGROPONTE: I think first of all what I would say is that we are still a very large and strong economy. We’re a very transparent society. So I think all of us have almost instantaneous visibility, if you will, into what is going on and what is happening. We remain a very open market for a large portion of the manufacturing capacity of the rest of the world. I think those fundamental facts and the fundamental strength of the United States economy will continue going forward, and I don’t think people should have any doubt about the continued fundamental strength of the American economy. That would be my message.

I think as far as the current situations are concerned, obviously they’re going to have to be worked through. But I think even if you look back at the past few months you can see where some specific issues that came up have subsequently been worked out or worked through and I think that process is likely to continue into the future.

Perhaps one last question.

Voice: I believe you were first. Can we take two?

DEPUTY SECRETARY NEGROPONTE: Sure.

Voice: Two more.

QUESTION: Hello, Mr. Ambassador. It’s a pleasure to listen to you. My name’s Brad Ziv. I’m with a trading company here.

With the close ties between China and Russia I was curious how Americans will be using China to resolve the Georgian conflict.

DEPUTY SECRETARY NEGROPONTE: Well -- [Laughter] -- you’ve managed to bring in three countries there.

Voice: Next question. [Laughter].

DEPUTY SECRETARY NEGROPONTE: First of all, I don’t think we pursue relations with these two very important countries, one at the expense of the other or anything of that sort. I think we value our relationship with both of them.

As far as the situation in Georgia is concerned I think I would say that it’s more about our relations with Europe because Georgia is part of Europe. It’s a country that aspires to become a member of NATO. The question of the relationship of countries to the south and the west of Russia is a matter of paramount concern to the European countries so we’ve been working with them to try to maintain a coordinated and a unified view, to try to make the Russians aware of the fact that the kind of behavior they engaged in in Georgia is detrimental to their long term interests, and that by engaging in that kind of action they have isolated themselves to some extent. So I’d say it’s more about our relations with Europe than it is with China, as far as Georgia is concerned.

Voice: One last question, please.

QUESTION: I’m Jonama Suliamanly (phonetic). He almost asked the question I wanted to ask. It’s about the similar region. I’m from Azerbaijan and I’m the only official resident of Hong Kong from Azerbaijan, so you can imagine my interest is about Azerbaijan, even though it’s not East Asia, it’s Eurasia.

Armenia has occupied 20 percent of our land. You know about the Karabakh problem, has been going on for 20 years now, since 1985. Why do you think we’re called the aggressors when our land is -- just your personal opinion -- when our land, 20 percent of our land was taken? [Laughter].

DEPUTY SECRETARY NEGROPONTE: That’s a leading question, but you remind me to make an important point about Georgia, too, which is: In addition to checking or containing or restraining Russia, if you will, with respect to Georgia. I think one of the other points is that we want to reassure our other friends in the region who neighbor on Russia that we care about them, that we are concerned about them. Our Vice President went to Azerbaijan, so I’m sure he had friendly things to say when he went there and I doubt he used any of the characterizations that you alluded to there.

I think this is a problem that needs to be solved one day or another in the Nagorno-Karabakh. I remember it back in the 1980s when it first flared up. It’s a continued sore point that impedes the establishment of normal relations between Armenia and Azerbaijan. I think maybe that’s an issue whose time has come in terms of some kind of renewed diplomatic effort to resolve it.

I myself plan to visit Azerbaijan in about a month’s time. I’ll be going there for the first time and I very much look forward to my visit. It’s transported us quite far from Hong Kong here, but nonetheless, I look forward to doing that.

Thank you very much.

The Honorable John D. Negroponte
Deputy Secretary of State
Impromptu Media Q&A Following AmCham Event
September 17, 2008

DEPUTY SECRETARY NEGROPONTE: Maybe I’ll just take a couple of questions. Yes, sir?

QUESTION: The recent [inaudible]in Russia are benefiting the regime in Iran. What are you doing there?

DEPUTY SECRETARY NEGROPONTE: Your question is about Russia and Iran.

QUESTION: Benefiting the regime in Iran.

DEPUTY SECRETARY NEGROPONTE: Iran is an issue of great concern to the United States. We don’t want them to develop nuclear enrichment capability and we don’t want them to develop any capabilities that would enable them to acquire nuclear weapons. Actually we have --

QUESTION: What are you doing about it?

DEPUTY SECRETARY NEGROPONTE: Well, there are already three Security Council Resolutions. We’re working with the Russians and the Chinese and others to --

QUESTION: [Inaudible; perhaps “Not the Russians.”].

DEPUTY SECRETARY NEGROPONTE: Yes, we have. They voted with us in the Security Council, to restrain Iran’s behavior. That will continue to be our position.

QUESTION: You mentioned military relationships the U.S. has with a number of states in the region. You didn’t mention the military relationship with Taiwan. I wonder what your thoughts are on what that really should be, and the apparent freeze there seems to be now on military sales to Taiwan.

DEPUTY SECRETARY NEGROPONTE: Well there’s not been any recent sales of arms, but there have been in the past and there may well be in the future. As I mentioned, we’re committed to conducting a defense relationship with Taiwan under the Taiwan Relations Act. That continues to be our policy.

QUESTION: But it seems to me there are no arms being sold. There seems to be a de facto --

DEPUTY SECRETARY NEGROPONTE: Well, there was an offer a number of years ago, and then only recently did the Taiwan legislature take the step of approving that offer. So now there’s a new government in office in Taiwan and we’ll have to see where it goes from there.

QUESTION: You’re saying that U.S. and China are having talks about the possible instability in North Korea, is that true?

DEPUTY SECRETARY NEGROPONTE: I am not aware of any talks between us and China on that particular subject, but certainly the issue of 6-Party Talks and the question of the denuclearization of the Korean Peninsula is very much an issue of discussion between our two governments. I’d say that is an issue that is always on the agenda between the United States and China.

QUESTION: What about Mr. Kim’s health up in the North? To what extent has that been a factor in the talks?

DEPUTY SECRETARY NEGROPONTE: I wouldn’t want to speculate on that. I just don’t know about his health.

QUESTION: -- difference emerging between India and the United States on the nuclear reprocessing rights and the supply of fuel. Would you care to comment?

DEPUTY SECRETARY NEGROPONTE: I’d say this has been a landmark agreement. We worked very hard on it. We want to move it forward. We negotiated with India. We worked with the Nuclear Suppliers Group. I think we’re going to keep chipping away at it, if you will, to try to bring it to fruition because we think it’s a positive --

QUESTION: Some say in India the United States is backing away from the assurance --

DEPUTY SECRETARY NEGROPONTE: I would think that’s wrong, frankly. I would say that we, despite reservations that have been expressed by other countries, have worked hard to overcome those reservations in support of the United States-India agreement. That remains our policy. We think it’s the right policy. I also think that President Bush and Secretary Rice have been courageous in pressing it forward in light of some of the resistance they’ve met from other quarters.

Thank you.
Released on September 17, 2008