5:58 P.M. (L)

They had a brief discussion on employment, again focusing on the need for structural reforms to foster employment. They then talked about social policy as an adjunct to that, both in terms or our own industrialized economies and also in the developing world and the importance of strong safety nets.

Then they turned to a discussion of a couple of foreign policy issues. They had a brief discussion about Turkey, following the elections, and the importance of sustaining Turkey's anchor in the West. They also had a brief discussion of the Cyprus peace process and how they might give some impulse to that moving forward. And then they had quite a broad-ranging discussion of the Middle East peace process, with a focus on the prospects for peace, both on the Palestinian and the Syrian track, a discussion about the formation of the new Israeli government and how it might approach the peace process, and particularly about how the United States and Europe can be helpful in moving that forward. They also spoke briefly about Jordan and the desire to help Jordan deal with its economic difficulties as a key peace partner.

In the afternoon, they returned to the planned agenda. The principal topics were the comprehensive threat reduction or extended threat reduction initiative that the President has been pushing. They talked particularly about the need to deal with plutonium disposition and to find productive employment for Russian scientists during the period of transition.

A number of countries talked about their efforts, particularly on plutonium disposition, which involves not only the United States, but also France, Germany, the UK and Canada and Japan, which has made new commitments on working on both decommissioning of nuclear submarines and also on plutonium disposition.

They then turned to the environment and the importance of integrating environmental issues into our trade agenda, and they returned once again to the issue of food safety. They had a brief discussion of the problem of Y2K, the millennium bug and, particularly, their concerns about how developing countries will be able to cope, and the need for the developing countries to provide assistance in crisis management as we get to the end state of this particular challenge -- which, presumably, at their next summit, they won't have to talk about anymore.

Q Did they approve the threat reduction initiative, and did they approve anything on debt -- specifically on debt relief for Russia?

MR. STEINBERG: Well, I think on all of these, the final touches are being put on the communique; and, so, in order to sustain the suspense and the excitement -- (laughter) -- for tomorrow, so that you will have a reason to come back, I'm going to refrain on comments. But they will address, I think, both of those issues in the final communique.

Q Jim, two questions. One, is there any paper or communique coming out today?

MR. STEINBERG: Other than the education charter, which I believe has come out -- yes. The rest of it will come out tomorrow.

Q And can you shed any light on a statement that Chirac made that there is some kind of statement coming out of the Summit on the partnership of prosperity with Russia?

MR. STEINBERG: Well, I think -- there are a couple of points in the communique that you will see, that talk about strengthening cooperation with Russia, and cooperation among the G-8. And I think that that's the thing that he was referring to, that we've been talking about a number of ways to do that. And that will be sort of woven in within the communique itself.

Q Jim, has the Gore Commission been fundamentally dormant since the air strikes began?

MR. STEINBERG: Well, as you know, there's been a change of government. And so, as has happened in the past when there was a new prime minister, it has taken some time to get that up and started. But I know that Leon Fuerth, who is the Vice President's National Security Advisor and sort of the person who organizes the commission on behalf of the Vice President, has been in touch with his counterpart on Prime Minister Stepashin's staff, and I don't want to preempt announcements that they may or may not have made, that I may have missed.

But they are moving forward on that, and so there has certainly been contact between -- since Stepashin became Prime Minister, there have been contacts between the Vice President's office and Prime Minister Stepashin's office, and they very much intend to continue that channel of communication.

Q But after the air strikes began, since then there's been no --

MR. STEINBERG: That's not entirely true. I mean, I think that -- as I say, there were activities that were going on while Mr. Primakov was Prime Minister and since Mr. Stepashin has become Prime Minister -- which has not been all that long, as you know -- they very quickly reengaged. and so I would say that there has actually been a fair amount of continuity.

Q Jim, can you expand on Nunn/Lugar -- can you tell us, have there been specific offers of hiring Russian scientists by specific countries, and the plutonium disposition -- how does this work, specifically?

MR. STEINBERG: Let me start on the plutonium disposition. There are, as I mentioned, many of these -- almost all the G-7 countries in one way or another have an engagement on plutonium disposition. The President --

Q You mean, you buy it up and you dispose of it --

MR. STEINBERG: There are different elements -- I'll say a little bit, and then probably this will be more than anybody ever wanted to know. But most of the focus has been on converting plutonium into a fuel called MOX, which can be burned in power reactors. And both the French and the Germans have a joint project with the Russians to use MOX in their power reactors, and the Canadians also have a project with their candu (phonetic) reactors, which actually takes it a next step and renders it to even a less dangerous state.

So what we're talking about here is to try to create a broader architecture so that we integrate the efforts of all of these countries that -- sort of from soup to nuts, we can deal with the plutonium problem. Some of this can be done through the private sector efforts, the French and the German is largely a private sector effort. The British have also been involved in looking for private sector ways to be involved.

But it's our view that this will also take public sector monies, that the market is not such that we can sustain a full strategy of plutonium disposition. That's why the President and President Yeltsin last year agreed on this program for disposing of 50 tons of plutonium. We have had appropriation from Congress in this past Congress, and we have a request this time around.

But what we need is an integrated architecture where the countries work together to make sure that we fully address the problem as we go from the nuclear quality plutonium all the way down to low-level materials. And I think the Japanese have indicated that they're going to increase their funding. The French, Germans and the British are now going to work with us to make sure that -- look at both what the private sector can do and try to identify gaps in funding so that there is a coordinated effort rather than these parallel efforts that have gone on up until now.

Q On scientists?

MR. STEINBERG: On scientists, again the Japanese have some activities in that respect. There has been some interest among our European partners. I think that that's something that -- following the initiative that we're launching today that there may be -- the United Stats has been very actively involved with this. We have this thing called the ISTC, which stands for the International Science and Technology Center, I believe, which for several years, in sort of the broader Nunn/Lugar framework, we have been providing funding for scientists who have been involved in weapons activities in the past to do research. It's been an ongoing thing. I don't have it off the top of my head how much we've done, but there was a significant increase in this year's budget for ISTC-type activities.

Q What kind of tone, I guess, do you expect at the meeting tomorrow, both with Yeltsin, with the group and with President Clinton?

MR. STEINBERG: I know that the leaders are very much looking forward to welcoming President Yeltsin. I think that they consider that the partnership that we've had with Russia, generally, and particularly with President Yeltsin, who has been a part of this for a number of years, is something that they put a lot of importance on. I think that they believe that the partnership has paid dividends, both for Russia and for the other G-8 countries over the past several years, that we've been able to make a lot of progress on issues of importance.

I think that looking back over Kosovo, the fact that Russia has stayed engaged with it's partners in the West, both contributed to the achievement of peace and now in the implementing of the peace as a result of the agreement that was reached by Secretary Cohen and Defense Minister Sergeyev. They can go forward. They have a lot of interests in common.

A number of the leaders today spoke of the fact that there are many of the global challenges that can't be effectively addressed without Russia's participation, whether it's global crime or terrorism or proliferation. And so I think they're going to very much welcome President Yeltsin, look forward to sustaining that cooperation. I think they've had very productive conversations with Prime Minister Stepashin. He's been a very -- contributed a great deal to the discussions over the past two days. Most of the leaders have had bilateral meetings with him. I think they've all been very impressed. So I think in terms of strengthening the relationship -- up until now it has been very good and I think that they're all looking forward to having President Yeltsin back to continue that effort.

Q On the subject of Russian debt relief, without preempting tomorrow's final communique, Stepashin has been quoted by Russian news agencies today as saying he expects this summit will deal with that question and give Russia some relief on that question. Without preempting the communique, would you expect that expectation --

MR. STEINBERG: At this point the most I'm prepared to say is I do think the communique will address the issue of Russian debt.

Q Will his expectations will be satisfied in some way?

MR. STEINBERG: I certainly hope so.

Q Was there no discussion today of reconstruction of Kosovo?

MR. STEINBERG: That was mostly discussed last night. And there was an extensive discussion at the dinner last night. In fact, I'm quite confident they didn't touch on it in the lunch and it was not touched on in the formal sessions. But they did talk about it -- it was the primary topic at the dinner last evening.

Q Mr. Berger talked about -- that option one moved beyond steel control, the steel export controls. Does that mean that the U.S. will allow more exports of Russian steel in?

MR. STEINBERG: Again, I was not in the meeting, the bilateral with the President and Prime Minister Stepashin, so I can't really specifically comment on that.

Q Can you tell us what the leaders said earlier about ways to sustain public support for free trade? And are the leaders more concerned about protectionism in their countries or protectionism in the United States?

MR. STEINBERG: I definitely don't think they would draw a distinction between the United States and their countries. And it's broader than protectionism in the narrow sense. I mean, I think that there are a set of issues that are sort of traditional protectionist issues that, particularly, we face because of the surge in imports in the United States.

But there are also a broader set of issues having to do with labor standards, environmental standards, science and technology, biotechnology. And I think that there was quite a broad sense throughout many of the different topics that they are all deeply committed to free trade.

One of the things that they did was to focus on the need for an ambitious round in Seattle, to launch in Seattle, that a number of leaders specifically used that word to identify their goals and objectives to keep the momentum going. But they also talked about developing the political sustainability. Both President Clinton and Prime Minister Blair in particular said, what we need is basically a two-track strategy, which is, rather than cutting back on opening trade and increasing market access, we need to continue to do that while working in tandem to address things like labor and environment and health and safety issues.

So what I think they felt was, they want to sustain that momentum, but that they recognize that failure to address these kinds of concerns would undermine the political basis for going forward.

Q The document on Kosovo reconstruction will be tomorrow, with the final communique?

MR. STEINBERG: Yes.

Q So we're not going to expect anything today?

MR. STEINBERG: We'll not see anything more today.

Q Jim, can you tell us how the discussion on food safety went?

MR. STEINBERG: Again, I mean, this was in the context of sustaining support for open trade. There was a discussion about the need to have a strong science-based approach to food safety that can give consumers confidence. It's an issue that is of concern to all of the leaders, and it's an issue that they think is going to be on the agenda for some time.

They talked -- without getting into a great deal of specificity, they talked about this as an issue that we needed to find effective ways to deal with that were consistent with the commitments to expand new trade, but also address problems of consumer confidence.

Q -- for Chirac's scientific, intergovernmental scientific body, or whatever?

MR. STEINBERG: I think the best way to characterize it is, there was support for finding ways to address the question of health and safety in the global trading system.

Q What's the U.S. position on that?

MR. STEINBERG: I think, again, we feel that a strong science-based approach is necessary. We believe that we've been very successful in the United States because of the long track record of the Food and Drug Administration. It's something the consumers have confidence in. The President, for example, has spoken to President Chirac and others about the desirability of the European Union developing its own FDA equivalent to give consumers that kind of confidence, of a strong science-based approach.

Q Can you tell me -- it was an issue in the last press conference -- is it your understanding that all of the G-7 is united in opposing reconstruction money for Kosovo while Milosevic is there? And did Stepashin raise that issue, that --

MR. STEINBERG: Again, they didn't discuss it again today. I don't know whether he addressed it last night. But it is very clear that -- all of the leaders who spoke to that issue indicated that that was their view.

And if you look at the Stability Pact, which we are all associated with, we have made clear that adherence to the principles of the Stability Pact is a precondition for benefiting in the economic reconstruction. Again, an exception for humanitarian aid that would go directly to human needs.

MR. HAMMER: Okay, last question.

Q Jim, just to confirm, you don't think there's going to be a separate document on Kosovo tomorrow, it will be inside the --

MR. STEINBERG: No, on that, I'm not saying that. I'm saying there won't be one tonight. We have not --

Q -- tomorrow?

MR. STEINBERG: I am fairly confident there will be something on Kosovo tomorrow. Whether it will be in the whole, the broader communique, or in a separate statement is something that we just haven't quite worked out yet.

Q And can you outline just tomorrow's meeting? What's the agenda for tomorrow?

MR. STEINBERG: The agenda tomorrow is largely to sort of review the work we will have -- those of us who have to do this kind of work will be meeting again tonight to try to wrap up text on the communique. I've indicated to you that there are still some issues that we're working on.

The leaders will review the communique. I think they'll talk about what they hope to do in the next meeting, talk more broadly about how they plan on taking the G-8 forward, looking back on how this meeting went. And, inevitably, because they're looking forward to President Yeltsin, I'm sure that there will be an opportunity for a dialogue with him at that session.

Q Jim, I mis-spoke. I meant Serbia. I meant, you know, reconstruction money for Serbia --

MR. STEINBERG: I was certainly addressing that, that's the question I was trying to address.

MR. HAMMER: Thank you very much.

END 6:15 P.M. (L)