Press Briefing by National Economic Advisor Gene Sperling and Senior Director Of NSC for European Affairs Tony Blinken on U.S.-EU Summit Meeting (12/18/00)
                              THE WHITE HOUSE

                       Office of the Press Secretary

Immediate Release                         December 18, 2000

                              PRESS BRIEFING
                         ON U.S.-EU SUMMIT MEETING

                     The James S. Brady Briefing Room

1:20 P.M. EST

     MR. CROWLEY:  The President had his 15th U.S.-EU summit today, in
which the leaders -- President Chirac and President Prodi of the EU --
talked about a mix of trade and security issues; also regional issues,
including the situation in Southeastern Europe and our collective
relationship with Russia and Ukraine, for example.

     So here to give you a quick readout of the major topics of discussion,
we have our National Economic Advisor Gene Sperling, and the Senior
Director of the NSC for European Affairs, Tony Blinken.  We'll start off
with Gene Sperling.

     MR. SPERLING:  I will be brief.  Today we will be releasing a joint
statement with the EU on AIDS, particularly concerning making drugs -- AIDS
drugs and other drugs for infectious diseases, such as malaria and TB, more
affordable in the poorest countries, and calling on our pharmaceutical
industries to work towards that goal.  Also, to support new innovative
partnerships to increase the availability of vaccines, to work on training
of health workers, AIDS test kits, and reducing mother-child transmissions
of AIDS.

     On the trade issues, there has been, as always, significant work and
discussion on both beef and bananas.  On bananas, there has been some
closing of differences in the last several days.  The issue was discussed
between President Clinton and President Chirac, but there is no resolution
at this point.  However, the negotiators, people in charge -- Charlene
Barshefsky and Pascal Lamy -- feel that there is reason enough to continue
talking and negotiating not only in the coming days, but even in the coming
hours.  So that is that state.

     On beef, again I think there has been some positive discussions in the
last couple of weeks on trying to move from a system of sanctions to an
agreement on access.  This remains, obviously, a difficult issue.  The EU
is having their own problems in their own market with the BSE and other
issues there.  Again, we feel that there is reason to continue talking and
seeing what progress can be made during this administration.

     In the President's meeting, during lunch, he did also sound a warning
to the EU on the issue of Airbus, and the concern, the strong concern of
Airbus proceeding with loans on non-commercial terms.  That would be in
violation of the WTO Subsidies Agreement.  And the President stressed his
concern that if that issue was not taken seriously, and if serious efforts
were not taken to work that out in a way consistent with what our view of
the WTO subsidy rules are, that that could be a difficult issue between the
U.S. and EU in trade in the future, and that he hoped that we could work

     On a more positive note, the President did compliment all parties in
working together on coming up with at least a temporary process solution in
the area of FSC, that has been successful in lowering the temperature and
hopefully giving all parties a chance to work towards resolution there.


     MR. BLINKEN:  Thanks, Gene.  Let me just talk briefly about the
security issues that they discussed.  But maybe starting with just a little
bit of context.  As PJ suggested, this is the 15th and now final U.S.-EU
summit in which President Clinton has taken part.  There have been profound
changes in both the EU and the EU-U.S. relationship over the eight years
that it took to have those 15 summits.  The EU when President Clinton
started was really not more than a free trade area for Western Europe's
democracies.  Now, of course, it has a common currency, the strong
beginnings of a common foreign and security policy, and it's in the midst
of an historic eastward expansion that eventually could literally double
the size of the union.

     And our own relationship with the EU during that period has gone from
something of a technocratic trade dialogue to a partnership that's focused
on economic issues, on security issues, on trans-national issues.  So I
think the President noted that strong evolution in the partnership over the
last eight years.

     The two security issues that the leaders focused on were, first,
European security and defense policy and, second, Southeast Europe.  On
European security and defense policy, the President applauded the strong
progress that's been made by the EU and NATO in forging a close
collaborative relationship that's very focused on capabilities.  It's on
the right track, the President said, and we're looking forward to seeing it
continue down that track in the months ahead.

     He pressed three points with the Europeans.  First, to keep the focus
on capabilities, on the hard assets they need to make their rapid reaction
force deployable and sustainable and to make it effective in the field.  He
talked about the progress we've seen in the links between NATO and the EU,
and the need to keep moving forward in that direction.

     And, finally, he talked about the role of the non-EU allies countries,
like Turkey, having participation in the EU security and defense process.

     On Southeast Europe, a few points in specific areas.  They talked
about Kosovo and, in particular, the need now to move ahead in planning --
setting and planning elections that would be Kosovo-wide; the need to
adhere closely to Resolution 1244, that talks about the need to move toward
self-government for Kosovo; and, of course, the problem of dealing with the
violence in Southern Serbia, from ethnic Albanian insurgence in Presevo.

     On Serbia, there was a lot of discussion about the real progress
that's been made on both the part of the EU and the United States in
getting aid and assistance to Serbia after the election, Mr. Kostunica, and
also in trying to welcome Serbia back into the community of nations, and on
the need now to effectively coordinate all that assistance.

     On the Stability Pact, which is the other thing that they talked
about, again, the President expressed a lot of appreciation for the work
that the Europeans had done on the Stability Pact, the pledges of
assistance and now the movement of that assistance from the pledging side
into actual commitments on the ground.  Quick start projects are up and
running.  There is still more to be done, to get more of them started.  And
they focused a lot of attention on the need to continue to turn the pledges
that have been made into actual work on the ground, so that people can be
brought into Europe and brought into its economic future, as well.

     They also discussed briefly the question of the U.N. scale of
assessments and the need to try and include an agreement on that this week.
And they also had some discussion about the relationship between Europe,
the United States and Russia, and also Ukraine.  Those were the key items
that were discussed.


     Q    Gene, on the AIDS deal and the vaccinations.  One, can you say
specifically what it is that the announcement is that we've agreed to?
And, second of all, how does the Clinton administration sign on something
now that carries forth into the Bush administration?

     MR. SPERLING:  Well, this is a call, a joint statement by the U.S. and
the EU to seek greater commitment to work with pharmaceutical companies to
ensure that there is more affordable prices for vaccines, drugs for AIDS,
in the poorest countries in the world, in light of the fact that, as the
President said recently, AIDS in Africa may be the number one crises in the
world today.  And this was a call for continuing cooperation on a number of
fronts and a call on our -- a call to go forward.

     Obviously, in many things we do, the next administration will have to
make decisions as to whether or not they want to continue these policies.
This is clearly policy that many Republicans -- I think of Chairman Leach,
for example -- take strong leadership and an interest in.  So I think that
you would have to ask them, but this is the planned U.S.-EU summit and this
has been -- these are things that have been worked on for several months
and I think reflect prudent assurances and commitments of this
administration that reflect a broad base of views in the United States on
the need to do more and more to ensure that there is affordability, that
we're not sitting there with potential vaccines and drugs that exist, but
that are so terribly inaccessible to people in the poorest countries in the

     Q    And does the agreement -- does the joint statement make any
commitments on either funding or regulations that would make this easier?

     MR. SPERLING:  Well, for fiscal year 2001, we've just had -- we've
just passed a very significant commitment.  So, for example, if you look at
the AID budget, it has gone from $139 -- well, let me see, excuse me, this
would include the AID and the HHS budget.  But the complete amount has gone
from $139 million in 1999, to $466 million.  That is $330 million at USAID;
$116 million at HHS; $10 million at DOL -- at Department of Labor; and $10
million at Department of Defense.

     So, in other words, we have just passed, the President has just
signed, the Republican Congress with Democrats has just passed a fairly
dramatic increase in AIDS funding.  So what we're trying to do in many of
these situations is use the commitments we've already made to leverage up
other commitments.

     Let's remember that the United States provides the serious bulk of
research in the world, in these areas.  We'd like other countries to be
doing that.  The United States is one of the main contributors to the GAVI.
We would like other countries to do so.  So I think that it's not as much
perhaps a new financial commitment as we were trying to leverage some of
the commitments that we have made on the public side and hope that they
would work together with us toward some goals of training, prevention, et

     The other issue goes more to an issue that's been discussed on many
international fronts, which is how you can work with pharmaceutical
companies to encourage more affordability.  And there the issue is how to
do that while not taking away the resources that are needed to encourage
resources; how to ensure that you're being fair to the poorest people in
the poorest countries of the world, without ignoring that there is
inaccessibility among poor people in the United States.  And this is at
least a call for both countries to move forward and make more progress on

     Q    Did the Europeans make any pledges or promises in response to the
President's warning, as you put it, on Airbus?

     MR. SPERLING:  Well, look, there's no question there's a difference of
view.  I think they suggested that they are working in what they believe
are the right terms.  They refer more solely to the '92 agreement and,
obviously, since then there's been a WTO subsidies agreement and that has
to be factored in.  And that's very essential to our understanding of what
is within the global trade rules at this point.

     But, again, I think that one of the points the President was making is
that we've had issues that have been very sticky between us on beef and
bananas, but we are seeing a couple of issues now -- such as FSC, Airbus --
where not only are they sticky, but the actual magnitude is much more
serious.  In FSC, we've seen some progress in lowering the temperature with
at least a temporary process solution.

     I think the President was saying, I'm not necessarily going to be
here, but that as somebody concerned with U.S. trade relations, he needed
to know that there was strong feelings, strong concerns, if there was to be
a proceeding with non-commercial loans and aid that we think are in
contravention of the WTO.

     They obviously often reply that they feel that there is somehow
similar -- or indirect aid that goes through Boeing, through various means
of the federal government -- it's not just an apples and oranges situation,
I mean, that's just simply not the case.  There is nothing that happens
with Boeing that is near what we see as completely non-commercial terms in
which much of the Airbus financing seems to be proceeding.

     Q    Can you talk about this biotech panel and what that means for
U.S. regulation of --

     MR. SPERLING:  Well, we're going to be looking at that panel.  It's
obviously a panel the President helped call for, a high-level consultative
dialogue on this.  I am not sure -- we are not sure that there is anything
in there that is necessarily inconsistent with existing U.S. policy.  It is
our view that labeling should be required where there is a true difference
in the foods or there is a risk of allergens.  We have said in the past as
part of our policy that we could support voluntary labeling where it could
be done, where standards could be developed, so that such labeling was
informative and not misleading.

     We'll obviously look very closely at the report that I think was in at
least one major paper today.  But at this point, I am not aware that
there's anything that is directly contradictory to the existing practices
of the U.S. government.  But, obviously, we'll look very closely and study
it more and take that very seriously.

     Q    Gene, how do you see the WTO agreement on subsidies impacting
loans and assistance made to Airbus?

     MR. SPERLING:  Well, I don't want to get into the -- I don't want to
-- I wanted to give you a readout.  I don't know if I want to turn this
into a full Airbus-Boeing briefing.  Obviously, one can have loans --
things that are called loans, that look a lot more -- that don't seem to
really have any downside risk for the person borrowing.  And when a loan
takes that character, then from our view, and I think from the WTO subsidy
view, that is not a loan on commercial terms.  And I think that there is a
lot of concern that there are so-called loans that have more of that

     Q    And just on bananas and beef, what likelihood do you think there
is of seeing a resolution on these issues?

     MR. SPERLING:  In our lifetimes?  (Laughter.)

     Q    During the lifetime of the Clinton administration.

     MR. SPERLING:  Seriously, I believe that there has been good faith
negotiations on bananas and beef.  On bananas, we've made clear we cannot
comply with a first-come/first-served system.  But we have also made clear
that we are willing to work in good faith to try to resolve these
differences in an honorable way that is fair to all the parties concerned.

     I think that what I would say is that this has been a long and
difficult issue.  I would say that there has been some narrowing, and that
there is at least enough hope that the parties feel it is worth their time
to continue negotiating.

     So I think they do -- I think we feel it is not out of the question
that this could be resolved in the life of this administration.  But,
obviously, as something that's gone on for so many years, I don't know if
one would want to bet the house on it, either.

     Thank you.

                            END                2:40 P.M. EST

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