Transcript
N.B.: (joined in progress)
JAMES STEINBERG: ...Although the topic for discussion this morning is the upcoming APEC summit, terrorism is very much going to be a part of both what we have to say and what the leaders have to talk about at the meeting in Shanghai.
It's always the case that in any major summit meeting that whatever the formal agenda and whatever the formal purpose of the organization that if you put heads of state and governments together they're inevitably going to be focused as much on the crisis of the day as they are on a long term agenda. Indeed, it's one of the great challenges to stay on the long term agenda because it's always the urgent matters that tend to crowd out the longer term ones, however important the longer term is.
Here, of course, the challenge is going to be greater than normal because as our panelists will discuss in some detail, the formal agenda and the principal purpose of APEC has been encountering difficulties over the past couple of years, and the importance and urgency of the terrorism issues are predominant not only in the minds of the United States but a number of other important participants.
I'll just say a word or two about that, and then our panelists will discuss in more detail a number of these issues.
To the United States, obviously, this is an important moment in the coalition building. This is, in effect, the east wing of the coalition which is meeting in Shanghai and there are some very important actors that the United States, President Bush will be interacting with. The President of Russia will be there, of course the President of China, but also a number of countries which may figure in the longer term struggles involving terrorism including the Philippines, Malaysia and Indonesia. So how this group reacts to the U.S. military operations, how this group postures itself vis-a-vis the broader war on terrorism, how even the issue of what is being combatted, how the group will define terrorism and who the enemy is here will be very important in terms of the long range support that the United States gets for its coalition.
The President will have a number of bilateral meetings. Perhaps the three most crucial being with the President of China, with Russia and Japan, but as I say there will be a number of other important opportunities to work with countries, both those who have been supportive like South Korea, and those who have been quite critical in some respects like Malaysia, and some which are experiencing enormous internal challenges over this issue, most notably Indonesia where as you've seen there's tremendous tension within the country and struggle even with the government there as to how they want to posture themselves. So it's going to be an important test for the President to demonstrate how robust the coalition is, what kind of support he can show, and how he can demonstrate to the broader international community and to other partners who are not present—particularly those in the Middle East— that the United States support is quite strong and robust.
Joining us today we have several distinguished Brookings scholars to talk about both APEC and some of the bilateral issues that we will be meeting today, that they will be discussing in the meeting, and we're going to begin with Lael Brainard, who will give an overview of the APEC meeting, then Nick Lardy will talk both about the history of APEC and particularly some of the economic issues involved in China. Ed Lincoln will talk about some of the other regional economic issues that will form the backdrop to the discussions in APEC. And finally, Bates Gill to talk about China, China's expectations, and the U.S./China issues that will be present both in the bilateral meeting and the summit of the APEC leaders.
With that, let me turn it over to Lael.
LAEL BRAINARD: Thanks, Jim.
I thought Jim was going to say, "and you can tell it's not a terrorism briefing because if it is we've got the wrong people up here." So I'll talk about stuff that I know about.
I think APEC could actually be a very interesting meeting this year on several different dimensions. I've counted five. There are probably others.
For President Bush, this is the first summit of world leaders he has attended since the seismic shift that took place in our foreign policy following the September 11th terrorist attacks, and in his own standing around the world.
APEC is always as important for the opportunities it creates for bilateral discussions, both formal and informal, with other very important world leaders. As important as it is for the formal meeting. This year, that will be more true than ever.
Secondly, and both Bates and Nick will talk about this in detail, for China, this is a tremendous opportunity to cast itself in a new light on the world stage. So far we've seen China really rising to the challenge.
It's somewhat ironic that in the year that China is finally hosting APEC, the focus is likely to shift very squarely in the direction of security. That's been the one dimension that China has always been very reluctant to see on the APEC agenda because of the presence of Hong Kong and Taiwan in particular. And yet they've been very helpful to the U.S. government in being willing to see the agenda broadened, to bring some of the counter-terrorism issues onto the agenda.
For APEC I think the big question this year is whether it can mature as a forum. When this group of countries originally started getting together in 1989 and then when it was elevated to a leaders forum in 1993, the reason this particular group of countries was chosen was clearly because of their economic importance in the world. Yet this year it turns out as a group they're profoundly important in the current alignment of friends and foes on the campaign against terror. Australia, Japan, South Korea, the Philippines, they all came out of the box extremely quickly as strong allies of the U.S. efforts. For others, as Jim mentioned, such as Indonesia, the conflict poses a very complicated set of issues.
Many of the countries in the region are unusual in that they have sizeable Muslim populations but at the same time are very modern economies and evolving in a democratic direction. Several of these governments are grappling with their own problems of Islamic extremist groups and have been singled out as countries that may be fertile ground for such groups to operate.
For APEC to show its lasting value at the leaders level it really does need to be able to address the full range of international challenges. It's simply not enough for leaders to get together year after year and talk about the same thing that finance ministers and trade ministers talk about. They need to be able to address the full set of things that they care about.
This year APEC will release a statement on terrorism. The condemnation, the language that is used for the condemnation, is one of the big question marks still. And it's interesting that although APEC is decidedly not a security forum, in fact many of the working groups that have been formed to facilitate trade are in the very areas that you'd want to see cooperation to increase security. So I would anticipate that there will be somewhat concrete initiatives on airport security, port security, the security of critical infrastructure, on customs, on immigration, on tracking and stopping the financial lifeblood of these groups, and some hortatory language on strengthening the technical capacity to combat terrorism in the region.
But what's interesting here is that these working groups were actually originally formed to focus on reducing the frictions, or in the parlance of economists, the transaction costs associated with transactions across borders in the region. And what these groups will now be asked to focus on is actually moving in the reverse direction, increasing security, which will inevitably increase some of those frictions.
The fourth dimension is on the state of the world economy. Leaders in the region are deeply preoccupied with the global economic slump and with the knock-on effects in their own economies, and they are going to be very interested in seeing whether President Bush is as focused on trade and on the weakening state of the U.S. economy as he is on some of the counter-terrorism issues. I don't think we'll see any concrete initiatives on macroeconomic coordination. That hasn't been a traditional strength of APEC, but I would expect to see a lot of concerns about weakening consumer confidence in the U.S., what that means for capital investment, and what that in turn means for the weakening electronic sectors in many of these countries.
As Nick will point out, China is a bright spot in the region, but the other countries in this region are really feeling the double whammy of chronic weakness in Japan and now renewed slipping towards recession in the U.S..
Finally, on trade I do expect to see a strong political statement of support for the launch of a round in Doha or wherever the WTO Ministerial is ultimately held, as well as a document called the Shanghai Accord, recommitting the countries in APEC to achieve their Bogor goals of opening trade in the region by 2010 for developed economies and 2020 for developing economies.
But in terms of concrete agreement to address the many important substantive differences on trade that continue to divide the countries within APEC, I don't actually expect much progress. There were meetings in Singapore over the weekend where some of the members of APEC were present and that was a forum where real issues were discussed, but I don't anticipate that APEC will actually resolve differences, for instance on things like agricultural access, on antidumping, on some of the implementation issues.
MR. STEINBERG: Let me turn now to Nick who will provide a thoroughly updated view of the achievements of APEC today.
NICHOLAS LARDY: Let me take off from where Lael talked in her last point on trade.
I think the real question is will APEC have a future as a trade organization. I think one has to really begin to raise the question of whether or not at least in terms of its major goal in trade liberalization, of facilitation, it has, it's a failed organization. It's vaunted trade liberalization agenda has not been seriously implemented. There may be a recommitment in the so-called Shanghai Accord to the [BOGAR] goals, but this is a very distant objective, and I would go so far as to say that the individual action plans of the various countries in the group that have been the mechanism for trying to get to the [BOGAR] goals of free trade and investment flows in the timeframe Lael indicated, really haven't worked.
I think if APEC has had one value it has been that it has demonstrated the limits of voluntary unilateral liberalization and non-binding commitments. Indeed I think it's really, in a sense, an argument for the continued ultimate importance of the World Trade Organization as the major organization for achieving trade liberalization. I'd say beyond that they have dodged the really tough issues—the Asian financial crisis in '97 and '98, there was no APEC response. And as Lael has already indicated, there's probably not going to be any coordination of macroeconomic policies growing out of this meeting to provide the widespread consensus that we're no the verge of a major global recession, probably the first global recession since the creation of APEC in 1989.
Just to underline this theme, let me turn briefly to China and its trade liberalization. I think the interesting thing is that in the period that APEC has been in existence, the major country in the region that has liberalized its trading system has been China. This has occurred entirely, at least substantively, within the WTO context. Whether it was within the context of its negotiations to become a member—first of the general agreement on tourist and trade, and since 1995, a member of the World Trade Organization. And that have really made very, very substantial progress.
Tariffs have been reduced by two-thirds, from about 45 percent, a little more than a decade ago, to only 15 percent today. The kinds of restrictions on imports imposed by licensing and quota requirements have been cut back by more than four-fifths. Those will be completely phased out over the first five years that China's in the WTO. I should have said similarly, tariffs will fall by an additional one-third to about ten percent or a little bit under ten percent by 2005 under China's WTO acceptance package.
The third major trade barrier in China traditionally has been limitations on trading rights which simply refer to the fact that the state has retained a monopoly on trade in many commodities but these monopolies have been reduced very dramatically over the last decade and they now only control about 10 percent of China's total trade as compared to about 90 percent a little more than a decade ago. Those restrictions are going to be further liberalized.
So China's had very dramatic trade liberalization, much much more significant than any other country in the region, and it has occurred within the WTO context.
Jiang Zemin of course several years ago used APEC to announce some of the goals China has, shall we say, tried to collect twice, get double credit by announcing some of these things within APEC. But the real binding commitments have been made within the WTO negotiations both bilaterally with various major trading countries and in the working party meetings in Geneva.
I think the results have been, quite frankly, stunningly successful. No country has ever expanded their share of world trade as rapidly as China has over the past two decades as this liberalization has been underway, and I think combined with the very rapid growth that China has achieved, it certainly is a testament to the desirability for countries throughout the world to further reduce trade barriers. I just don't happen to think that APEC is going to ever provide the mechanism for achieving that.
As a final topic I'd pick up very briefly again what Lael mentioned on the likely emergence of a global recession, or at least in the U.S. and I would go further and say global. China of course does remain the bright spot in the region with fairly strong growth. They've just announced their figures through the third quarter of this year. They remain far and away the fastest growing economy in the world, a very slightly lower rate of growth in the third quarter but still well within the seven to eight percent range for gross domestic product. Export growth continues to be quite positive. Only in the single digit range, but remember last year exports increased by 25 percent, so we're going up another 10 percent no top of that. So they're ramping up on a very strong base from the year 2001. And you compare that performance with declines in exports in places like Singapore, Taiwan, and some other economies in the region, it's really quite remarkable.
It's in part because China is less exposed to the downturn in IT. It has a much more diversified set of exports. IT is important, increasingly important for China, but they still have major exports in traditional labor intensive products—apparel, footwear, sporting goods, toys, and so forth—in which they have become the dominant supplier to the international market. So it's a quite different export composition compared to say Singapore, Taiwan and some of the other countries in the region.
They're also continuing to do well despite the weakening of the international economy, largely because domestic demands remain quite strong. Retail sales growth is still in the double digit range. The demand on the consumption side, demand is also fairly strong on the investment side because of a very strong government proactive fiscal policy that has been in effect for the past three years or so.
On the supply side, the situation's also fairly positive. Foreign direct investment inflows continue to be quite strong, adding to investment demand. The interesting things is industrial growth has been the driver of the economy and in the first half of the year about a third of industrial output growth has come from firms that have foreign investment to one degree or another, so foreign investment firms are playing a very significant role in sustaining the underlying growth of the economy.
I think the major Chinese concern, and Lael alluded to it, is the fact that when the planning in the run-up to the APEC meeting in Shanghai, China certainly saw this as a chance to showcase its enormous accomplishments in the city of Shanghai itself which of course are very dramatic, to showcase its trade liberalization, the backdrop of China's admission to the World Trade organization on or around the turn of the year, very shortly thereafter, and their very strong performance in the region really emerging as an engine of growth. Obviously their concern is that terrorism is going to overshadow this traditional economic agenda and make the meeting in Shanghai somewhat less successful from their point of view than it might be.
MR. STEINBERG: If APEC is not succeeding, are there other regional alternatives to APEC? Ed Lincoln.
EDWARD LINCOLN: Yes. Nick talked about the fact that APEC did not respond much in the midst of the 1997 Asian financial crisis. One of the outcomes of that crisis was considerable dissatisfaction on the part of Asian nations about the performance of the United States and the IMF, Europeans, in trying to push them... First of all, blaming them for having caused the crisis, and also for the kinds of policies the IMF had adopted.
One of the outcomes of that, therefore, has been an increased interest across Asia in pursuing a dialogue on economic issues that excludes the West. The principal format that has taken is a grouping known as the ASEAN Plus 3 Ministerial meeting. That's the ASEAN countries, plus South Korea, China and Japan.
So far that grouping has not produced very much. The one concrete policy they have adopted is to endorse a set of expanded swap arrangements among their respective central banks which is now being worked out in the format of specific bilateral agreements between central banks, to enable a central bank of an Asian country whose currency is under attack to be able to draw upon resources from these other central banks and to spend their currency. I think this is a policy of somewhat dubious value. If your currency is under attack usually there's a reason for it, and simply having more resources to defend the currency in the exchange market may not be a very good policy, but that's the one thing they have accomplished so far.
In addition to that, the ASEAN Plus 3 group has engaged in some fairly loose talk about perhaps fashioning a free trade area among themselves. China proposed a China-ASEAN FTA. Others didn't like that idea so they said how about just having a complete ASEAN Plus 3 FTA. So they're talking about it, but it hasn't developed into anything very concrete yet.
The other development that I find interesting on a regional level is the change in Japanese trade policy, which has been very noticeable in the past 18 months. Japan has first and foremost been a believer in the institution of the GATT and the WTO. I say the institution. They haven't necessarily abided by the spirit of opening up markets in this context, but that's where their institutional focus has been. That and bilateral trade discussions with the United States.
In the past 18 months... And I should add that they were also a prime mover in getting APEC created. To the extent that they wanted a regional discussion, they wanted the United States in it. In fact in the late 1980s they were concerned that the United States was becoming less interested in Asia and therefore wanted to create APEC as a specific mechanism to keep the United States engaged in Asia at the level of government-to- government discussion of economic policy.
But the Japanese have also become disenchanted with APEC and so one of the Japanese responses has been to participate in the ASEAN Plus 3 process, but also to begin pursuing bilateral free trade areas around the region. They have in fact just signed this past weekend their first ever bilateral FTA with Singapore. Now that ought to be a really easy thing to do since Singapore essentially doesn't have trade barriers. This negotiation turned out quite difficult for the Japanese because Singapore wanted to include agriculture—not that Singapore has a big agricultural sector—and the Japanese would not agree to it. So they now have an FTA that excludes agriculture. There are actually only two products that were involved—cut orchids and tropical fish. Not big markets, but that was too much for the agricultural interest in Japan.
Nevertheless, they've done this and again there have been study groups between Japan and South Korea about perhaps negotiating a Japan-South Korea FTA. I believe that would be much more difficult both for political and economic reasons. But there's talk of doing that.
There has been looser talk of a Japan-China FTA. That again may be years down the road, but it's interesting the Japanese are talking about these and were not until very, very recently.
Let me conclude by saying that from an American perspective, as much as APEC may not be producing much in terms of real agreements on trade or even trade facilitation, it seems to me clearly the American government interest lies in trying to continue to pursue APEC because it does include us and these other alternatives do not. If you look at the trade data there's a pretty strong argument that you could make that it makes sense to have a discussion that includes the United States.
If we look, for example, at the grouping of Asian countries other than Japan, they export more to the United States than they do to Japan. Some 22 percent of their exports come to the United States; only about 13 percent go to Japan. So instead of thinking that it might be natural for Japan to carve out a special relationship with its neighbors, they actually have a stronger trade relationship with us than they do with Japan. And the relationship with Japan actually has been sliding in terms of percentage of exports. The same is true of China. China exports 23 percent of its exports to the United States and only 15 percent to Japan.
So if you look at the trade specifics, it suggests that rather than going down the route of a narrower Asian grouping, it makes sense to pursue something like an APEC. So it is particularly unfortunate that APEC has not been producing very many results, while I think the U.S. government is stuck with that partly as a hedge against these other alternatives.
MR. STEINBERG: Finally, Bates, talk about U.S.-China relations.
BATES GILL: Thank you, Jim.
I'm going to turn from economic issues and raise two points that I think are worth watching in order to put the President's trip in its political and foreign policy context. First, what the APEC meeting and the presidential trip means to China; and secondly, what the meeting and the trip will mean for U.S./China relations, especially in the context of the counter-terrorism effort and other issues on the bilateral agenda. Lael and Nick have already covered some of the points in this first issue.
As Lael noted, this APEC meeting was meant to be China's grade entrance on the regional and international economic stage. I think it still will be to some extent, but of course it's being overshadowed in many respects by the events of September 11th.
Shanghai has been in preparation for years, investment of billions of dollars in so-called APEC construction in the infrastructure for the preparation of this big event, has certainly changed the face of Shanghai, and has raised very high expectations that this meeting would be an opportunity for China to step grandly onto the international stage.
I think another important point though to raise is this was also an opportunity for the President of China, Jiang Zemin, for him to step grandly on to the international stage as well, and to see this as part of his longer term legacy, establishing him more firmly as the leader who has brought China into the world arena and onto the world stage. I think it was especially important Jiang Zemin to be seen in this way as he moves into the critical transition to the fourth generation of leadership about a year from now in China.
Let me put those issues aside for the moment and turn more directly to the question of what this meeting is going to mean for U.S./China relations.
I think there is a sense of disappointment in China that this trip is not going to include the originally scheduled working meeting that President Bush was going to have up in the capital, Beijing, following the APEC meeting. And rather, his meetings with Jiang Zemin while on Chinese soil, will be somewhat at a par with other important summit meetings he will be holding during the APEC meetings with other leaders in many regards closer to the United States and more important such as Prime Minister Koizumi of Japan and President Kim Dae Jung of South Korea and President Putin of Russia.
But nevertheless, I think the Chinese can at least be happy that Bush is coming to China. This will be his first visit to that country since the mid 1970s when his father was a liaison official before we had normalized relations. So he has not been in China in about 25 years, and I think the Chinese are very keen to showcase Shanghai, this remarkable international city, and to show President Bush as best they can the sort of modern and outward looking approach which China can show to the world.
Also Jiang Zemin is very keen to use this visit as a means to set U.S./China relations on a more stable course to establish himself also politically as the person who can stabilize U.S./China relations. In spite of the many difficult issues which the U.S./Chinese relationship has had over the past eight months, nevertheless I think we have to recognize that Jiang Zemin has invested heavily his own political capital in the preservation of a stable and improving relationship with the United States. So this visit is important to him. He's going to have to have something to show for this investment. Hopefully he's able to get certain concessions and agreements out of President Bush during this brief meeting.
Several issues of course on the bilateral agenda will need to be covered, but I don't think they're going to get the same kind of play time as will the big issue of the day, that is the counter-terrorism effort. But certainly the range of bilateral problems between the United States and China which existed on September 10th certainly exist today and will be a part of the discussion in Shanghai including issues such as missile defense, China's human rights record, of course the question of our relations with Taiwan, China's proliferation practices, and we should expect a continued Chinese push to have as part of the bilateral summit meetings a formal declaration by the two sides which suggests that the two sides are going to move into a new era, a kind of new partnership, although that word is not likely to be used. But nevertheless, something akin to that is something which Jiang Zemin would very much like to see.
JAMES STEINBERG: Constructive competitive.
BATES GILL: Yeah. Constructive chaos.
Let me focus briefly on the issue of terrorism. I think we should be relatively happy and encouraged by the generally positive response the Chinese have given in our efforts to counter terror. Certainly China does not wish to stand in the way of the international community which seems to be lining up with the United States on this issue, and China, of course, has its own internal reason to be concerned about the spread of terrorism.
China has supported the UN Security Council Resolution which has given us basically a green light to deal with terrorism as a threat to international peace and security, and I'm told also that China has taken steps along its own border to bolster security and prevent the use of their border region, if possible, in the near term for the activities of terrorists that we're targeting, especially in Afghanistan.
China has also taken steps to raise the terrorism issue more prominently through the mechanism of the Shanghai Cooperation Organization, and has shown a willingness to at least tolerate or accept a bolstered American military presence in China's own backyard in Central Asia.
We should also point to China's helpfulness in providing political and moral support to Pakistan to make the difficult choices in support of the counter-terrorism effort, and apparently there has been some limited discussion between our two governments in an effort to share intelligence, which might be helpful in the counter-terrorism effort.
All that said, though, I think the longer term problem is the one that challenges us in the U.S./China relationship in the counter-terrorism effort. In many respects the efforts we're undertaking will exacerbate longstanding concerns that the Chinese have about American security policies abroad. Just to name a few, as we take steps to strengthen our alliance partnerships, especially with Japan in the counter-terrorism effort, that runs counter to many Chinese security interests.
Also China has longstanding policies which have a strict definition about sovereignty and intervention, which if we take further steps along the counter-terrorism road certainly will be viewed with some concern by the Chinese. I've already noted that our presence in Central Asia must be of some concern to China, and particularly our effort to reinvigorate our friendship with Pakistan, which is as close as it comes to an ally with China, also might be viewed with some concern in Beijing.
So the longer term sustainability of Chinese support is an issue that the Bush Administration will need to carefully manage.
I think, though, that an opportunity does exist for us to use the counter-terror efforts as a kind of common threat which can integrate our policy towards China on a number of key issues which have been problematic in the past. I think it is possible to show the commonality of interest between the United States and China in fostering an environment not conducive to proliferation where weapons of mass destruction may fall into the hands of rogue elements or rogue regimes, to link that also to a looser interpretation by China on sovereignty and intervention to allow for a greater degree of international action and response within sovereign borders to deal with terrorists.
I think also this issue can be used as a way to reassure China about the role of our alliances and American military presence abroad. So in many respects there are new opportunities available. It will not be easy, but the near term outlook looks pretty good for at least a slight uptick in what has been a pretty dismal U.S./China bilateral relationship for much of this year.
MR. STEINBERG: Thanks, Bates. We're ready for your questions.
Q: George Condon with Copley News Service.
Two questions. Bates just touched upon the effect of September 11th on Chinese relations, but can anyone talk further about how September 11th has affected U.S./Russian relations with the Putin meeting, and U.S./Chinese? And secondly, what is President Bush likely to be asking Presidents Putin and Jiang for as far as further contributions to the coalition?
Voice: It really is striking to see how the events of September 11th have really shaken up a set of relationships which we all thought we were beginning to understand— how the Bush Administration was proceeding, what their priorities and strategy was. I think there's nothing more striking than vis-a-vis Russia.
We've had an Administration that came in office that was critical of the Clinton Administration's approach, a sense of over-personalization of foreign policy, too much focus on an individual leader, and questioning about whether Russia should play as prominent a role in overall U.S. foreign policy. We've seen, even before the September 11th event, a deepening of a personal relationship between President Bush and President Putin, but a really dramatic change, I think, since September 11th.
I think a large part of that is due to what was clearly a very strategic decision by President Putin as to how he wanted to position Russia in response to the September 11th attack, and how he saw this in terms of two very broad Russian interests. First, and probably the most important, was Russia's interest in gaining support for its own, what it views as counter-terrorism concerns, particularly with respect to the Caucuses, not only in Chechnya but more broadly throughout the region. A sense that to the extent that Russia's own conflict could be seen as a fight against outside terrorism supported by Islamic Fundamentalists, particularly those with ties to Afghanistan, that an issue which has been a very thorny issue in both U.S./Russian and European/Russian relations could be transformed to one where it's actually an area for positive cooperation.
But I also think it provided an opportunity for President Putin to demonstrate to the United States and the West that Russia has something to offer, and therefore was and ought to be treated as a mores serious partner.
I think the most ceramic example of that is the ultimate resolution of the internal debates in Russia about the stationing of U.S. forces in Central Asia. If you'll recall when the first discussions took place, while the Russian government was very supportive in principle about the U.S. fight against terrorism and willing to be supportive particularly with intelligence and other kinds of cooperation, there was an initial kind of hesitation about the idea of the Russians or countries in the former Soviet Union actually providing military support, base and logistical support and the like. We even had the Russian Defense Minister suggesting that that was off the table. Yet within a matter of days we saw President Putin essentially giving a green light to the U.S. presence in the region and particularly in Uzbekistan.
If you think about it, it really is dramatic in terms of traditional notions of Russian spheres of influence and the like to see Russians in effect supporting the idea of U.S. basings on the territories of the former Soviet Union. But I think it reflects the idea that Putin wants to be seen as a partner of the West.
The question here, as with China and the base discussion, is whether there is an implicit quid pro quo, or whether there is some kind of down payment that's being made here, even without an explicit understanding about a quid pro quo, that will be sort of played out in the future.
There's no doubt that with respect to Chechnya and the South Caucasus that I think there's an expectation by the Russians that the United States and others will be more understanding of their problems. But whether this will also translate into other...
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