HEADLINE: DEFENSE DEPARTMENT SPECIAL BRIEFING SUBJECT: EAST ASIA STRATEGY REPORT BRIEFER: JOSEPH NYE, JR., ASSISTANT SECRETARY OF DEFENSE FOR INTERNAL SECURITY AFFAIRS MONDAY, FEBRUARY 27, 1995 BODY:STAFF: Good afternoon. Thank you for coming in. I'd like to welcome you to today's special briefing on the East Asia Strategy Report. It's my pleasure to introduce to you the assistant secretary for International Affairs, Dr. Joseph Nye, Jr. He will go through some very brief opening remarks and then be happy to take your questions. Dr. Nye? MR. NYE: Thank you. We will be distributing at the end of the meeting the copy of the East Asian Strategy Review. I'll say a few words in introduction and then answer your questions before we hand out the report. The East Asia Strategy Report is something that Secretary Perry has asked me to do. It's one of a series of reports on U.S. regional security strategies that take into account the changes in the international security environment since the end of the Cold War. So this report on the East Asian Pacific region is thefirst in a series. The process of drafting these reports is an extremely valuable one. What it does is it's taken many months of review and it helped to pull the government together in terms of how we see our security strategy in East Asia. The editi ngwas done here at the staff in International Security Affairs, but it's also beenworked through with our military commands in the region, with the joint staff ofthe Department of State and the National Security Council. The principal purpose of the report is to explain the Department of Defense's security strategy for the region to our friends and allies in the region, the Congress and the American public. There have been two previous East Asian Strategy Reports that were issued in 1990 and 1992, and those reports envisaged a series of post-Cold War troop reductions through the end of the decade. This year's report supersedes them and, by contrast, reaffirms our commitment to maintain a stable forward presencein the region at the existing level of about 100,000 troops for the foreseeable future. There are several reasons why this report is particularly timely. The post-Cold War changes in the security environment have raised a number of questions about the permanence of U.S. interests and presence in the region. In addition, of course, this is the year of the 50th anniversary of the end of the Pacific war, and what this document does is explain why America's strong military posture in the region continues to be necessary. In able to put this in an historical context, I invite you to think back to the year 1975. That was the year when the United States was withdrawing from Vietnam. There were widespread predictions that there would be chaos in the region of East Asia. And instead, what we've seen is just the opposite -- extraordinary stability and extraordinary economic prosperity. I think that, as the report says, that among the most important reasons of why those gloomy predictions of '74, '75 have turned out to be wrong have been the continued presence of substantial American forward-based troops and the maintenance of American alliances. In that sense, though people talk about this era after the Cold War as being an era of geo-economics in which economic frictions will predominate, I would remind you that in a sense, security is still the critical variable. Security is a lot like oxygen. We live in a security-rich environment right now, but letme tell you that if you began to loose your oxygen or your security, your priorities would change immediately and the thing you'd think about first and foremost is whether you have the oxygen, or in the East Asian context, the security. Or another way of thinking about this is that it's the presence of American alliances and forward-based troops, I believe, that have helped to provide the oxygen for the remarkable growth in the East Asian economies. In that sense, the United States maintains a strong interest in East Asia because not only of the geopolitical reasons that are explained in the report, but also because of the development of the economies. Asia today is the most rapidly growing economic area in the world. And if you look at American trade with East Asia, in 1993 it totaled over $374 billion and accounted for nearly 3 million United States jobs. And we expect that East Asia will account for aboutone third of the world's economic activity at the start of the next century. Inthat sense, a prosperous and stable East Asia is vital to America and to the world security. I should say that the long history of close American cultural and economic security ties gives us a basis for the posture which is outlined in this report.What you'll find in this report that is new or that is different from the previous reports that I mentioned is this commitment that there will no longer be any drawdown of troops, that that is over; that the previous reports that suggested a continuing drawdown through the rest of this century are superseded.The figure of 100,000, more or less, will remain as our targeting figure. And Ishould point out that this is roughly the same number of troops that we have forward-positioned in Europe. The other thing you'll notice in the report that's different from the last one, last two reports in 1990 and 1992, is the reference that's made to multilateral institutions. East Asia is an area that ended the Cold War without major multilateral institutions, in contrast again with Europe, and this administration has made major efforts to add multilateralism. But let me make an important point here. The strategy is not based on multilateralism, the strategy is based on reaffirmation of the bilateral alliances we have: Japan, Australia, South Korea, so forth. And what we are doing is adding a set of multilateral institutions, if you want, as a surrounding around this core of thebilateral relationships. So while we are indeed stressing the increased importance of multilateral institutions, it's not at the cost of our primary attention to reinforcing the traditional security alliances we have in the region. In other words, as you look ahead in East Asia I think you can draw the same lessons that we drew looking backwards. If 20 years ago the reason that the predictions were wrong was because the Americans actually maintained their forward presence in East Asia, we believe that looking ahead 20 years the same will be true, that a stable and prosperous East Asia depends upon the American forward presence and the stability of those bilateral alliances, in this case with an additional element of multilateral institutions to help with confidence- building and transparency in the region. And that's the argument that you will find in the report and how it differs from the previous reports onthis subject. So let me stop there and open it up for your questions. Charlie? Q Joe, what is this -- you say for the foreseeable 100,000 troops. What does this say about the U.S. troops in South Korea, which is a large chunk of those100,000? What does this say over the next decade, say if relations between Seoul and Pyongyang improve dramatically? MR. NYE: We should be so lucky. Our plan is to keep -- we have about 37,000 troops in South Korea. Our plan is to keep them there so long as they're wanted and needed. After that wonderful state arrives that you just described, in which you have a democratic, non- threatening North Korea in which there isno problems on the peninsula, then we will obviously discuss with our Korean allies what level of American troops they want to have present. But we would --we will wait. I don't think that's an imminent or short-term problem. Yes? Q I want to follow with the gentleman's question. In previous reports the U.S. frozen the second phase of the withdrawal -- U.S. troop withdrawal out of South Korea. And here you mentioned that you will maintain 37,000 as long as South Koreans want. In other words, you dropped th e old strategy? MR. NYE: That's right. The old strategy has been dropped. That's one of the twothings I said that is new, and that basically we are superseding or rescinding the 1992 report. Yes? Q Could you describe some of the new security issues that you face since the last report came out, specifically the rise of the Chinese military and also theSpratlys issue? MR. NYE: Yes. The report points out that we do not want to see China as an enemy. Secretary Perry has made this clear a number of times. He made it clearagain during his trip to China last October. China is a -- it is a very large and rapidly growing economy so -- and its defense expenditure grew by 40 percentin real terms over the last five years, albeit starting from a low base. What the secretary said to his Chinese interlocutors during the trip is we urge upon the Chinese that they enter into discussions with their neighbors to increase transparency and confidence in the region so that the worst-case assumptions will not be made and there won't be an arms race in the region. Andin that sense, we have had visits back and forth with the Chinese to discuss these types of issues; that includes how we see the Spratly Islands. As you know, the official position of the United States is that we have not taken a position on the legal claims. We urge the parties in the region to discuss this and to assure that there will be a peaceful resolution and we note that the government of Indonesia has helpedto stimulate a number of discussions, some of them non-governmental, which have come to the interesting suggestion that the best thing to do is not to push forward early claims of sovereignty in the Spratlys but to see if many of these things can be adjudicated or mediated or developed in ways before the sharp lines are fully drawn. Q Dr. Nye if I could follow that question. With regard to the increased projection of Chinese naval power, acquisition of Russian submarines, how does DOD now view the Chinese naval strategy? And secondly former Secretary James Baker said several weeks ago that China could come under the rule of the PLA. What does it look like in this succession situation presently? MR. NYE: Well, succession periods are always difficult periods which create uncertainty and anxiety of their own and nobody can quite predict what will happen. We do not expect at this stage that you're going to have a military take over in China but the larger question of where is China going over the longrun, I think the important thing is to see a China or to see if we can try and help encourage a China which is a good neighbor in its region which essentially accepts this invitation to join in the multi-lateral dialogues that we're encouraging as well as the bilateral dialogue that Secretary Perry began during his visit last October and to be careful not to put ourselves in a point where by predicting an adversarial relationship we create one. We want to be careful not to have a self-fulfilling fallacy here. Q Can you share the security situation on the coast of Taiwan straits. It seemsthe Deputy Secretary of State Winston Lord mentioned many times that China has no intention neither the capability to take Taiwan and what's your response on that? MR. NYE: Well, the United States has a long-standing position of wanting peaceful relations in the Taiwan straits and the extent that to which we have been helpful in the past in that area and we will continue the policy as it now stands. There are not changes in the policy in the Taiwan straits. Yes. Q If North Korea give up their nuclear ambitions and a peace treaty is established between the South and North Korea, can you or at that time can youdeduce or withdrawal the U.S. troops in South Korea? Or on what basis can you maintain the U.S. troops in Korean peninsula? MR. NYE: We hope that the North Koreans have indeed given up their nuclear ambitions. That indeed was the intent of the framework agreement that was signed last October. But notice the framework agreement takes a long time to work itself out. There are various steps along the way. It doesn't rely upon trust, it relies on meeting certain deadlines, certain accomplishments to go forward, and many of those will take close to a decade. So on the nuclear issue, we have a framework, but it's something that will be worked out step by step with performance measures along the way that will take a good long time. But in addition to that, the American troop presence in South Korea is not keyed to the nuclear issue, it's keyed to the point that there are 1.1 million North Korean troops within -- in the country has a whole, and that two-thirds ofthem are deployed along the demilitarized zone. We feel that the framework agreement was an important step forward in limiting North Korea's nuclear capability and reversing it, but that it, frankly, does not provide the basis for withdrawal of troops so long as there is this major conventional threat or conventional problem along the DMZ. Q You said that -- both your undersecretaries have said that while there is somelink that progress -- military progress between the United States and China is not wedded to economic progress, while there is some connection there. Do you see this trade agreement as possibly speeding up closer military relations with China -- over the weekend? MR. NYE: I think the American military and trade relationships have to be in balance with each other. The administration has made it clear that there are several dimensions to our relationship with China and that there has to be progress on all fronts, so we can't go too far further in the military area unless there's progress also in the other areas. In that sense I believe that the progress in the trade agreement reached this weekend is a useful step. It may allow then some forward steps on the military side. But again, there has tobe an overall balance. This is one overall U.S. policy, not just a military policy. Yes? Q What does the report say about U.S. presence in Southeast Asia following U.S. withdrawal from the Philippines? And also, the newly-created ASEAN Regional Forum? MR. NYE: The report is very supportive of the ASEAN Regional Forum. Indeed, it is exactly the type of multilateral instrument that the administration wishes toencourage. It provid es an opportunity for countries in the region to meet, discuss with each other and to build confidence and increase transparency, all of which are things that we're working on. In addition, the report refers to the importance of our access rights in Southeast Asia, the importance of our continued presence afloat. We not only have rotational access, for example, where the Air Force comes into Singapore, where we do joint training missions and so forth, but we also have considerable naval presence afloat. So the report stresses that both of those are going to continue. Yes? Q Do you foresee any future U.S. military presence in or cooperation with Vietnam? MR. NYE: There has been progress, as you know, with Vietnam in the sense that wenow have the liaison missions established, and the president has said that the best chances we have for improving the information we have about prisoners of war and missing in action is by developing this relationship, including both thetrade and the liaison offices. That's the area where there will be concentration. I think any military cooperation or contacts will be subsidiary to that. Yes? Q Another follow-up on China as it relates to Korea. In your report, what about the shield, the theater shield for South Korea and Japan, I take it, shielding them from North Korean attack by missile? The Chinese have objected strongly to this. MR. NYE: We believe that theater ballistic missile defenses, TMD, are going to be an important part of defenses in East Asia in the future. As we face the prospects of proliferation, this type of defense will be important in East Asia and in other regions as well. I can't imagine the United States having its troops forward-based without having an ability to defend them. So it's not a hostile act aimed at a particular country to say that we will defend our forces and our allies with theater missile defenses. Q China has said that this type of theater defense would take away their nucleardeterrent -- their missile defense. MR. NYE: That may be the Chinese view. You just heard my view. Behind you. Q Is there any new element in the role that you want Japan to play? MR. NYE: We believe that Japan is itself already evolving in a number of directions. If you look at Japan's performance in Cambodia, in Mozambique, in Goma in relation to the Rwandan refugees, these are important steps where Japan has used its international position in a helpful global way. We are prepared tosupport that, but it has to be Japan's decision as to whether it wants to do it.But the extent to which Japan wishes to move in these directions is fully consistent with what we would like to see. As you know, we have stood behind Japanese membership in the Security Council, permanent membership in the Security Council, and we stand behind the idea of Japan playing a larger, globalrole within the U.N. context. The extent to which Japan wants to move in these directions, we are prepared to be supportive. Yes? Q Last year, when Kim Jong Il took over his father's position in North Korea, there was a lot of speculation about how long he might be able to hold on. What's your assessment of that now? And also, how long can their economy support that big army? MR. NYE: Well, it's a very interesting question, and unfortunately we don't haveadequate answers. In fact, I doubt that even Kim Jong Il knows the answer to that -- to either part of the question. It appears that for now, that Kim Jong Il is indeed in charge, and the North Korean economy has had severe problems for a number of years since the end of the Cold War. What -- at what point these will lead to changes are not, frankly -- is beyond my ken. Yes? Q What's the next step in the military relationship with China? MR. NYE: Well, the next step in the military relationship is a set of visits. There is a -- right now a visit from General Jiu (sp), who is the president of the Chinese National Defense University. He was the guest of General Rocky (sp) at our National Defense University. He will be meeting with the secretary of defense. There are ship visits that will be scheduled. And as we see how otheraspects of the relationship develop, then there may be further steps. There is also, as you know, a defense conversion commission that meets now with the Chinese, which is having a regular set of meetings on how to get out of somemilitary industries and turn them to civilian purposes. And that Secretary Perry dealt with during his visit last October, and that's an ongoing set of relationships. Yes? Q Yeah. The increased reliance on multilateral institutions seems to work better in Southeast Asia than in Northeast Asia. Given the bilateral mistrust that exists in Northeast Asia, do you really feel it's realistic to rely on multilateral institutions, and if so, which ones? MR. NYE: Well, remember we're not relying upon them; we're trying to add them asan extra layer. We're relying upon our bilateral alliances. So the core, as I stressed earlier, the core of the strategy is first and foremost to maintain the bilateral security alliances, then to add on --where possible -- multilateral fora to increase confidence and transparency in the region. So think of a solid core of the bilateral alliances, and then we add on, if you want, its overlapping chinks of armor or -- you know -- overlapping plates of armor, if you like -- the idea of the multilateralism. It has been easier in Southeast Asia, as you pointed out, where the ASEAN Regional Forum is a major step forward. It's also been easier in the economic area with the creation of APEC. We are encouraging the idea of a Northeast Asian regional security forum to allow the states in that region to discuss these with each other. But as youpointed out it is difficult to move on that right now, primarily because of the problem on the Korean peninsula, that's (stemming?) with North Korea. But we are prepared to be supportive of that and the extent that there are non-governmental -- or what's sometimes called second track initiatives -- just outside the governmental context by keeping governments informed, we regard these as helpful as well. So, it may be a slower process in the North but we think it is a useful process to encourage. Yes? Q Yes. There is a report that you have been studying the possible new creation of Northeast command system separated from Pacific command regime. Can you comment on that? MR. NYE: I think that that is not a credible report at this time. Let's see, we should make sure people who haven't had a chance -- you didn't have a chance in the end, yeah. I'll look backward next round -- (laughter) -- all right, this man. Q (Off mike) -- either increase or decrease military sales? MR. NYE: There are not plans -- let me point out what the conventional arms transfer policy of the United States is. Our view is that we do not sell arms for commercial purposes. The major reason in the sale of arms -- primary criterion in the sale of arms -- is whether it will have a stabilizing or destabilizing effect in a region. In that sense the arms transfer policy for East Asia fits within that, so we will deal case by case with requests as they come up and analyze them as to whether we think the introduction of this particular equipment will be stabilizing or destabilizing -- therefore will depend upon the country and how it relates to its neighbor's armaments and its overall relations. So there is no master plan for arms sales. There is a policy which was announced by the White House last week on conventional arms sales, and Asia willbe treated -- East Asia will be treated within that policy as we look, case by case, of whether particular sales will be stabilizing or not. All right, I owe the back row -- Q Yes. There were reports that China have developed opposition to the U.S. military presence altogether. Are these reports true? Did China in any way formally or informally say this, or -- MR. NYE: Say that they wanted -- Q (Off mike) -- against military presence -- against United States military presence in their region? MR. NYE: I don't remember the Chinese during our visit last October encouraging or discouraging the American military presence. I think they just took it as a fact of life, and we discussed what it would mean and how we could make sure that it didn't lead to misunderstandings or misinterpretations. But I don't remember during that visit with Secretary Perry the Chinese either saying do it or don't do it. I think the questions we dealt with is, since we're going to be here as a fact of life, how do we make sure there are no misunderstandings about that. Yes? Q After '97, with the British withdrawal from Hong Kong, the American fleet willlose the facilities there. There's a regular (series ?) of visits and use of facilities there. Are you talking to China about possibly being able to keep those visits going after '97? MR. NYE: Well, in the context of overall U.S.-China relations, supposing that those relations continue to develop successfully, I would foresee a number of ship visits in which Hong Kong would be among the ports called upon. In the back. Q Thank you, sir. Let me ask one more question about Korea. You just mentioned that the Pentagon decided -- (inaudible) -- presence of U.S. forces in Korea. However, there is (something, forecast ?) that the U.S. is pursuing-- (inaudible) -- ground forces instead of taking extra advantage of the Navy and Air Force. So, concerning that there is some assessment that there is maybesort of to scale down the ground forces in Korea, could you comment about that? MR. NYE: Well, remember that over the longer term, and indeed today, the majority of the ground forces are South Korean, and the United States has been taking a number of steps in the command arrangements in the peninsula to encourage South Korea being responsible for its own defense. But there is no plan to reduce the American ground forces at this time. I should notice that ifanything, we might be moving to a reinforcement of equipment. We have modernized a number of the -- much of the equipment for the ground forces in Korea, and there are plans for prepositioned equipment for forces that could come in. So I don't see this as a reduction of our ground presence. But it is true that we are encouraging South Korea to take more of a role in the commandin the ground forces. Again in the back. Q I understand your new strategy will repeal Nunn-Lugar proposal on Capitol Hillas far as reduction on South Korean based U.S. troops is concerned. Is this strategy supposed to be carried out immediately or does it need approval on the -- (inaudible)? MR. NYE: The strategy is designed to go into effect now. I mean this is indeed the -- the strategy, we have been working on this for several months and it takes that time to be cleared with the White House and the other agencies. But yes, it is now fully cleared by the White House and it is effective at the pointof announcement, so when you pick up the report at the end of the meeting, the strategy in that report is effective as of now. Q Regarding the relationship with Japan, is it time for the United States to ease up on its trade negotiations in order to further bolster the security arrangements with Japan? MR. NYE: Well, the Clinton administration has had a metaphor that it uses for describing its relationship with Japan, which it sometimes called the three-legged stool, in which it says -- the president has said himself, there isno bilateral relationship, bar none, more important than the U.S. relationship with Japan, and that relationship rests on three legs of the stool if you like, military security, economic and trade, and political cooperation. We believe that it's essential for all of these legs of the stool to be firm andwell placed on the ground, and I would not want to say that one has to take priority over the other. We believe that all three of them have to be dealt with at the same time. Q Following up on that, has the United States' positions on trade, has that damaged the relationship with Japan on security issues? MR. NYE: I don't believe so. In my visits to Japan I have found a strong interest in the U.S.-Japan security relationship and we are working on, over thecourse of this year, on ways to reaffirm that and to strengthen it further. So I don't notice any damage on that. STAFF: We've got time for just two more questions. Q You have -- (inaudible, coughing) -- that the Pentagon will maintain a number of the troops presently in that region. About the number of U.S. bases in Japan? Are you going to touch the numbers on that? Also, are you planning to beef up the technology in Japanese bases? MR. NYE: I'm sorry, the last question was? The second half. Q Are you planning to modernize the military presence in U.S. bases in Japan? MR. NYE: Yeah, let me make clear that when we -- the answer to the first question briefly is, no, there are not current plans to reduce bases. But if some point in the future you read that there are bases being closed and you say,how is that consistent with what is said, you'd be fully consistent, because if we close or adjust something somewhere downward, something else will probably goup. To give you an example, we are adding F-16s, which are of a newer generation, which have more capability than those that are there now. So don't get too fixated on a particular base or a particular unit. It would be crazy to have a military structure of 100,000 which we made no changes in. Just the nature of military technology would mean that would become rusty and obsolete. So there will be constant changes and adjustments to make the forces more efficient, and there may be a little reduction here or a plussing up over there, or one unit may go down and another unit may go up. So this is not something where you takeeach soldier or Marine and put his feet in concrete and plant him there. There will be changes. There are not now changes planned for bases closings in Japan that you asked about, but if there are, it will be because of efficiencies, and in many cases, such as I mentioned, the technologies that are coming in as we modernize equipment actually increase our capabilities. Yes? Q How do you foresee the future of the armistice agreement with North Korea? MR. NYE: The United States has a very firm position on this, that the armistic e agreement is still in effect, that it can't be unilaterally abrogated by North Korea, and that if North Korea wants to deal with the questions of relationsin this area they have to deal with the armistice conditions -- commission and do it with South Korea. We are not prepared to have an American -- North American or United States relationship with North Korea which excludes our close ally South Korea. Q Does it appear that the reactor situation will be solved so that the South Korean design reactor will be accepted? MR. NYE: This exact moment I can't tell you the prognosis on it, but I can tell you that we are committed that the reactors will come from South Korea. STAFF: Thank you.