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Caucasus: Increased U.S. Aid Tied To Resolution Of Conflict

By Lisa Kammerud

Washington, 30 March 1998 (RFE/RL) -- Senior U.S. officials say they would like to expand economic and political development programs in the Caucasus region, but cannot do much until the Armenians and Azerbaijanis resolve their territorial conflict and the region becomes more stable.

Assistant Administrator for the U.S. Agency for International Development (USAID) Donald Pressley says Georgia, Armenia, and Azerbaijan have assets and advantages that give them great potential for prosperity, if they can overcome certain obstacles.

He made the comment in testimony last week before the U.S. House of Representatives International Relations Committee, inquiring into proposals for U.S. aid to Russia and other newly independent states in 1999.

Pressley said Armenia's development has been slowed by the war over the Nagorno-Karabakh province and what he described as "a limited will at the national level to undertake genuine reform."

But on the plus side, he listed Armenia's "highly educated workforce and economic links to private interests abroad."

On future aid plans, he said the U.S. wants to continue present efforts to reduce nuclear hazards and reform the energy sector with the ultimate goal of, "privatizing and improving efficiency, in economic terms, of the power sector."

Pressley said officials want to add Armenia to a list of countries involved in energy partnerships with the United States.

Turning to Azerbaijan, Pressley noted that a U.S. law banning direct aid to the Azerbaijani government limits the U.S. to mostly humanitarian relief. He said the law prevents the U.S. from providing structural assistance, which he said is unfortunate in the long run.

Pressley warned that without direct U.S. support, authoritarianism and corruption could stall economic reform in Azerbaijan.

The State Department's chief coordinator on aid for the newly independent states, Richard Morningstar, also criticized the restriction in his testimony to the committee.

He urged legislators to repeal the law and make it possible for the U.S. to provide, in his words "comprehensive and direct assistance to the government of Azerbaijan."

Both witnesses said the U.S. would like to include Azerbaijan in the Trans-Caspian Environmental Partnership, a cooperation project among states in the region to deal with oil and gas spills and other environmental hazards. But the U.S. legislation prevents it.

The dispute between Armenia and Azerbaijan over the Nagorno-Karabakh region remains unresolved going into its tenth year, although a truce has been uneasily observed since 1994.

The U.S. Congress has allocated more than 12 million dollars for the victims of the conflict. A congressman on the panel criticized the State Department, saying most of the funds have not yet been distributed to the needy in Nagorno-Karabakh.

The money is to be spent on providing medical care, shelter, and economic assistance to people displaced by the conflict. U.S. officials said the International Red Cross is already providing immunizations and medical services for children.

In testimony on Georgia, the officials said the U.S. will continue a high level of involvement.

Pressley praised what he said is Georgia's reform-minded government and its success in resolving internal ethnic and political tensions.

He said now Georgia can "focus its full attention on the formidable task of political, economic , and social development after years of internal conflict."

Pressley mentioned a project to provide American expertise in pipeline transactions that will help Georgia get full benefits from transporting Caspian Sea energy deposits.

He said the U.S. will also continue technical assistance to the Georgian government and parliament to help with computerizing operations and establishing modern management systems.

Morningstar said further plans for assistance to the Caucasus include expanding law enforcement training in Armenia and Georgia, and a medical program in the region to combat infectious diseases, especially tuberculosis.

The U.S. Congress must approve funds to accomplish these goals in the national budget for fiscal year 1999,which begins in October.