179 JOINT 14 E

ESC/PC

179 JOINT 14 E

Original: English

NATO Parliamentary Assembly

SUB-COMMITTEE ON TRANSATLANTIC ECONOMIC RELATIONS (ESCTER)

SUB-COMMITTEE ON

TRANSATLANTIC RELATIONS (PCTR)

MISSION REPORT

WASHINGTON d.C., uNITED STATES

vANCOUVER AND VICTORIA, CANADA

28 APRIL – 3 MAY 2014

www.nato-pa.int 19 August 2014

This Mission Report is presented for information only and does not represent the official view of the Assembly. This report was prepared by Paul Cook, Director of the Economics and Security Committee and Steffen Sachs, Director of the Political Committee.

I.  introduction

1.  38 Members of the NATO Parliamentary Assembly’s Sub-Committees on Transatlantic Economic Relations (ESCTER) and on Transatlantic Relations (PCTR) visited Washington D.C., United States and Vancouver, Canada from 28 April to 2 May 2014 to discuss a broad range of issues, including transatlantic relations, energy security and Canadian perspectives on the pivot to Asia. The delegation was led by Chairpersons John Dyrby Paulsen (Denmark) and Menno Knip (Netherlands).

II.  Meetings with US Government Officials

2.  The meetings with senior officials of the US Departments of State and Defense and with Members of Congress focused on US-European security relations in the context of the Ukraine crisis, NATO, and energy security, among others.

3.  Principal Deputy Assistant Secretary of State for European Affairs Paul Jones affirmed that the US rebalancing to Asia was never supposed to diminish US relations with Europe. There is a close cooperation with Europe on the situation in Ukraine; the United States supports Ukraine politically and economically. The US government pursues an approach which imposes costs on Russia for its annexation of Crimea as well as its military incursion into Ukrainian territory and its support for militants in the east of the country. A diplomatic approach is preferable, Mr Jones said, adding that the Allies are encouraging Russia to take the path toward de-escalation. That said, the United States also wants to reassure and support NATO Allies in Eastern Europe and in the Baltics in particular. Recent US military deployments to the Baltics are designed to reassure. The administration is aware of the changing threat perception and Washington will continue to review its military presence in the region.

4.  Russia’s recent actions towards Ukraine constitute a fundamental change of the strategic environment. Even though the United States and the Allies have tried to integrate for more than 20years Moscow has violated the fundamental integrity of other states. The United States considers Moscow’s policy as a long term challenge. Developments in Ukraine have also led to a renewed recognition that NATO Allies need to invest 2% of their GDP in defence. Although Russia has modernised it armed forces over the last five years and now fields more capable military, especially special forces, it remains behind the military capabilities of NATO members and does not pose a strategic threat; rather, it is a regional power that can take steps in its periphery that is hard for the United States to counter without great costs. However, the United States and the Allies have to confront such behaviour by Russia - or risk seeing more of this. In this context, he mentioned the situation in Moldova as well as the frozen conflict over Nagorno-Karabakh.

5.  The upcoming NATO Summit will focus on Ukraine, though Afghanistan will also feature on the summit agenda. NATO’s Strategic Concept, and its emphasis on collective defence, crisis management, and partnerships remains valid. The discussion with the delegation focused on Western coherence towards Russia and possible ways to influence it. Mr Jones commented that the Allies have been unified in their reaction to Russia and that increased pressure will generate political and economic isolation for Russia, which, in turn, could shift events over the longer term. Moreover, people-to-people contacts are important and the United States is looking into ways how they can be increased. At the same time, Moscow is using propaganda to stir up Russian minorities in neighbouring countries. He also expressed concern about corruption which is either intentionally exported by Moscow or it seeps out to some of our partner countries, for example in the Balkans. Corruption is also a big problem in Ukraine and the United States is trying to put in place mechanisms to increase transparency and reign in corruption.

6.  Michael Fuchs, Deputy Assistant Secretary of State for East Asian and Pacific Affairs, Bureau of East Asian Affairs, explained that US policy towards Asia focusses on economic and security issues as well as on the engagement with people. As to the economy, the United States recognises the dynamism and growth taking place in Asia and has spent a lot of energy on achieving a free trade agreement. As the security situation in the region is very complex, the United States. remains committed to its regional allies. President Obama has sought to shore up America’s alliances with Japan, South Korea and other allies. Just recently the United States has signed a historic agreement on defence co-operation with the Philippines, which foresees an enhanced rotational military presence in the country. As to Japan, the United States is reaffirming its commitment to the bilateral defence treaty to dispel security concerns in the country, which has a profound debate about the nature of its own defence posture. The United States encourages Japan to extend a friendly hand to the region, the State Department official added.

7.  Washington also wants a positive relationship with China and feels that the rebalancing to Asia-Pacific is not about China; it merely reflects the continuing security commitments of the United States. China has benefitted from these commitments as much as the United States and its regional allies, he added. A positive aspect in the relationship with the People’s Republic of China has been that Beijing demonstrated an increased willingness to talk more openly about NorthKorea and the concerns it has. However, one should not expect that the issue of NorthKorea and its role for regional and global security to quickly go away.

8.  More generally, Washington’s policy approach towards Asia emphasises a focus on multilateral engagements, Mr Fuchs explained. In its efforts to strengthen ties with the countries of Asia, the United States is looking beyond just governments and engaging with people. In this context, the United States is particularly intent to promote educational exchange. The rebalancing of the United States. focus to Asia is not about moving away from Europe but rather about strengthening US presence and engagement in the region, the delegation was informed. The growing importance of the region for the world economy and the host of security issues make Asia also important for Europe, the speaker noted. He concluded his presentation by encouraging the European Union to send an ambassador to ASEAN.

9.  In his exchange with the delegation Jim Townsend, Deputy Assistant Secretary of Defense for Europe and NATO (OSD Policy) covered relations with Russia, defence spending and NATO Ballistic Missile Defence (BMD). He called on Allies to forge a common front in the face of the Russian challenge but noted that allied credibility will hinge upon higher levels of defence spending and the development of 21st century military capabilities. Russia’s annexation of Crimea and its menacing stance towards Ukraine require a clear and unified response by the Allies. Moscow needs to understand that there will be costs if it does not change its attitude, the DefenseDepartment official said. He also underlined the need for NATO Allies to make the necessary investment in defence, particularly as a great majority of the Allies have decreased military spending in previous years. Acknowledging that defence spending is facing tough domestic opposition in times of fiscal austerity, he said that political will and leadership is required to increase defence spending. Mr Townsend continued by arguing that national parliaments play a hugely important role for defence spending as they can put pressure on their governments to invest sufficiently in defence. The United States alone cannot always remind the governments of NATO member states to fulfil their commitment. The United States and NATO are moving ahead with their plans on BMD, Mr Townsend said. With the deployment of the first of four US missile destroyers to Rota, Spain, earlier this year, the initial part of NATO BMD hardware has already been put in place.

10.  Dan Chiu, Deputy Assistant Secretary of Defense for Strategy, provided a general overview of the Quadrennial Defense Review (QDR). The QDR is mandated by Congress every four years and provides a review of US Department of Defense long-term strategy and priorities in response to the threats and challenges that the United States faces. In general terms, the QDR is a “dialogue” between the US Administration and Congress on the overall direction of US defence policy and budgeting. In contrast to previous defence reviews, the 2014 QDR has put a stronger focus on internal budging issues than at any other time in the past. This shift in emphasis reflects the uncertainty about the development of US defence budgets. Although the Obama administration continues to put a premium on military capabilities and readiness the effects of the “sequestration” law that triggers automatic and across-the-board budget cuts for a ten-year period beginning in USFiscal Year 2013, have hit the military particularly hard. According to the QDR sequestration measures are limiting future capabilities and readiness. If Congress cannot agree on future budget reductions and sequestration continues the United States may have to envisage more drastic force cuts which Deputy Assistant Secretary Chiu considered unwise. As the United States will have to be able to respond to contingencies in the future, it will be important to retain the necessary flexibility in implementing sequestration measures, the delegation learned. The United States wants to prevent and deter conflicts and it is likely that it will have to respond to contingencies. NATO remains a very strong partner for the US.

11.  The delegation also received briefings about Afghanistan from Mike Dumont, Deputy Assistant Secretary of Defense for Afghanistan, Pakistan, and Central Asia on Afghanistan. As he pointed out, the outcome of the presidential elections in Afghanistan will be of crucial importance for the future of the country. To that end, providing security to conduct a free and fair election is a key concern for the Allies. The first round of the elections has been conducted successfully on 5 April. According to initial estimates approximately 60% of those eligible voted, 36% of them women. The NATO-led International Security Force (ISAF) has been working closely with the Afghan National Security Forces (ANSF) to prepare for a safe conduct of the elections. There were security incidents but no major ones and some polling stations were closed in more remote areas and where security situation was fragile. The second round of the elections is likely to take place between mid-to end of June. If the last elections were any kind of guide the ANSF are well positioned to take care of security.

12.  The overall security situation in Afghanistan has improved over time. The Afghan military has made great strides. However, there will be challenges along the road and one of the important issues that need to be solved is the signing of the Bilateral Security Agreement (BSA) between the United States and Afghanistan. The BSA and the political transition in Afghanistan will define the US military presence in Afghanistan beyond 2014. As the Afghan government has still not signed the BSA no decision has been made by President Obama on the future engagement of the United States in the country. Therefore, US government officials are planning for various contingencies. While Mr Dumont was optimistic for the future of Afghanistan and for the ANSF, he added that much of it will depend on the support that Afghanistan will receive from the international community in the future. The United States is willing to continue supporting Afghanistan, but it will have to insist on the Afghan government meeting standards on matters like corruption and human rights. Moreover, there needs to be progress on the role of women in society. Education plays an important role as women’s rights are less of an issue in an educated society.

13.  Afghanistan’s neighbours are also interested in the stability of the country. Iran is interested to maintain the influence it has in the Western part of Afghanistan. Russia, which has been co-operating with NATO in, for example, the Helicopter Maintenance Trust Fund Project, is concerned about a possible deterioration of the security situation. Though NATO-Russia relations have deteriorated after the annexation of Crimea, Russia has not indicated that it plans to thwart the withdrawal of NATO equipment from Afghanistan. China is very much interested in Afghanistan’s natural resources and is buying up licenses for mining although only few investments have taken place so far.

14.  Alice Friend, Principal Director for African Affairs in the Office of the Secretary of Defense, provided a briefing on Africa. She noted that the African Union has the will but not capacity to stabilize countries like the Central African Republic, Mali and South Sudan. Though piracy off the Horn of Africa has declined it has grown in the Gulf of Guinea. More generally, Africa continues to face enormous challenges that include extremism, increasing urbanisation, environmental degradation — which leads to fight for scarce resources — and corruption. At the same time, the capacities of African states to tackle security challenges are limited, she noted. The United States pursues a policy that is geared towards ending existing conflicts and the US Department of Defense pursues a global approach to anti-terrorism, which emphasizes a better co-ordination of collective approaches with countries in Africa. To that end, the United States assists partner countries in military capacity building while leveraging this with the promotion of human rights and civilian control of the military in addition to supporting growth and development. In this, the UnitedStates follows a small footprint approach, such as in the Sahel and the Maghreb that includes other actors like the African Union and the UN. As the US presence in Afghanistan will be reduced, US engagement in Africa is likely to increase, preferably also in a multilateral context, especially with the Allies. The United States is very receptive to hearing proposals by its European partners and Allies about ways to improves security in Africa, the Defense Department official underlined. The security challenges emerging from Africa and across the Maghreb have influence the US military posture in Southern Europe, she added.