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U.S. Ambassador Jeffrey Lunstead
On Signing of Supplemental Spending Measure and
Tsunami Relief
American Center, Colombo
13 May 2005
Public Affairs Officer Philip A. Frayne: Good morning and thank you for coming to
this press briefing at the American Center. We’re happy to have you here. As you
know, the sheets we handed out to you two days ago, President Bush signed
legislation, which would amongst other things increase significantly the United
States aid for tsunami relief and reconstruction. So without further a due I will
introduce Ambassador Jeffrey Lunstead and Andrea Yates, Acting USAID Director
in Colombo.
Ambassador Lunstead: Thank you, Phil. As Phil said, two days ago on May 11,
President Bush signed the Supplemental Appropriations Bill, which will provide $907
Million for tsunami relief and reconstruction. Some of this money will go to repay
expenses, which have already been incurred, by our Department of Defense and
USAID, and some of it will also be used for regional assistance on a tsunami early
warning system. Of that money approximately $656 Million will be available for direct
assistance to tsunami-affected countries. We don’t know yet the exact amount that
will be available to specific countries; that will be determined over the forthcoming
weeks between the Executive Branch and the Legislature. But we do know the
areas we intend to work in, in Sri Lanka and in other countries, and I’d like to
discuss, brief you today, on those areas and some of the specific projects we plan
to do.
These will all come under our action plan for relief and reconstruction. One of the
areas will be what we call transition from camps to communities. On this effort, we
will provide money, which will be used for cash for work programs, which will provide
assistance to businesses in the affected areas, which will allow them to get back to
work. This will also provide psychosocial support for affect individuals and families,
especially children. As part of that psychosocial support for children I’d like to
mention one area in which we’ve already begun work on, which is that we are going
to build one hundred playgrounds in affected areas, which will help children get
back to normal activities.
Some of this money will come from the supplemental; some of it is also being
donated from funds raised by former Presidents Bush and Clinton in their initiative.
We also – and you may have seen this, it was in the newspapers yesterday – are
providing $3 Million to the Bounce Back Tourism Campaign. All of this is intended to
restore normal life, as it says, to return people from camps to communities, restore
normal life, help them get back their normal livelihoods in these areas.
We will also be doing a large-scale infrastructure program. We expect this will be
about $35 Million – that’s an approximation, we don’t have an exact figure yet.
There are several different components to this; one is in the Aragam Bay-Pottuvil
area, we will replace the Arugam Bay Bridge, which was badly destroyed, which has
a temporary bridge, which was set up by the Government of India, but it needs a
permanent bridge. It will be more than just the bridge, in addition to the bridge we
will provide a water and sanitation system for the Pottuvil and Aragam Bay area; this
will include a sewage drainage system and provision of fresh water, and the hope
here is that this entire package will again allow Aragam Bay, which is an important
tourist sight, to come back to restore economic activity. We call this the Aragam Bay
Project, but it’s much bigger than just the bridge, it’s an integrated project, which will
significantly upgrade the facilities in the Aragam Bay area.
We will also rehabilitate or rebuild up to fourteen vocational education schools,
which were damaged or destroyed in the tsunami. These schools are in the south
and the east. Two of these schools will be model schools, which will be designed to
demonstrate maximum use of environmental principals; they’ll be “green” schools,
so to speak. We’ll also assist in upgrading the curriculum and the teaching
methodology for these schools. This is intended not just to rebuild a physical facility
but to help in the overall economic development of these areas because we think
that vocational and technical education are very important for economic
development in Sri Lanka.
We also will rehabilitate or rebuild three fisheries harbors; these will be Hikadua,
Marissa, and Dondra. This will include repairing damage from the tsunami,
especially damage to the break waters, will include where relevant building new
break waters, will also include upgrades to the entire fisheries infrastructure. For
instance, facilities for fish waste disposal, so that the fish waste is disposed of in an
environmentally sound manner, and also fish processing and flash freezing plants
so that the fishermen will have an improved economic opportunity there for
fisheries. Again, this is not just rebuilding what has been broken by the tsunami, but
upgrading the facility to provide greater economic opportunity. These are large-
scale infrastructure programs that I mentioned.
We’ll also do small-scale infrastructure throughout the tsunami affected area –
schools, clinics, sanitation systems and community centers. These will be labor
intensive projects which will be opportunities for communities and local authorities to
prioritize their own community needs and for getting money back into the
communities as we rebuild. Now, all this infrastructure will need to have
maintenance and capacity so we will also provide capacity building at provincial and
local levels to help governance and to provide better service delivery in these
areas.
I mentioned earlier that there’s also a component of this bill, which will go towards
Tsunami Early Warning. Some of that will be for a regional system, some of it will go
towards local capacity in tsunami early warning – we haven’t worked out the exact
amounts yet, but it will be a substantial component. That’s what we’re planning to do
with this bill that’s been passed, and I’d be happy to take any questions.
Question: I’m Zainab from Lanka Business Online. I have two questions. The first
one is, what was the outcome of yesterday’s private sector summit that was held in
Washington on tsunami reconstruction, and secondly, what is the U.S. Government
position on suspending taxes on Sri Lanka’s exports for about three years. This was
asked for as tsunami relief. What is the position of the U.S. Government on that?
Ambassador Lunstead: I actually haven’t seen a report yet on the private sector
summit, but of course since we’re ten hours ahead of Washington it’s a little hard to
get the report. I have not seen a report yet on it, so I can’t answer the first question.
The second question, you’re talking about debt relief? I’m sorry, I meant to mention
Debt Relief, and it’s in my notes and I forgot. The bill also includes funding for short-
term debt deferral and restructuring; what the bill would do would be to allow Sri
Lanka and Indonesia, if they choose to do so, to defer their official government debt
to the United States for a period of one year and then to restructure that debt to
repay it over the following four year period; this would allow relief to current
budgetary expenditures. Now the bill says that if this is done the resources that are
saved must be used to benefit tsunami victims. The government of Sri Lanka has
about $40 Million in official debt payments due to the Government of the United
States this year, so that would be the amount that’s deferred if the Government of
Sri Lanka decides that it wishes to do so. That’s a decision for the Government.
Question: V.S. Sambandan from the Hindu. What is the total official debt of the Sri
Lankan Government to the U.S.?
Ambassador Lunstead: I believe it’s about $500 million, but I’m not sure. We could
check on that and get back to you if you want to leave your name. I don’t have that
figure with me, but the relevant portion is the amount that’s due this year is about
$40 Million, which we are willing to restructure and defer over four years.
Question: Dilip Ganguly from Associated Press. Could we have a little bit (unclear)
on the debt issue to understand it better? Can we defer it by a year?
Ambassador Lunstead: Right, the amount that would be due this year, which is
about $40 Million we would defer, the Government would not have to pay it this
year, and it would then be paid over the following four years. So it’s a four-year
restructuring.
Question: (Dilip Ganguly, Associated Press) What if the Government agrees to
spend this money on tsunami…
Ambassador Lunstead: On tsunami, and other conditions. It’s a Paris Club initiative,
so the Paris Club sets certain parameters, debt referral and restructuring is a highly
technical subject which I’m not an expert, probably none of us are, so the
government will have to decide if it wishes to meet specific conditions, but the offer
is on the table.
Question: Has the U.S. Government taken a position on suspending export duties,
which would largely benefit industries like the apparel industry in Sri Lanka?
Ambassador Lunstead: No, there has not been any decision on that. The United
States has looked into some measures, which would provide some trade benefit to
the tsunami-affected countries. One of those measures is to allow accumulation of
GSP benefits to South Asian countries, but there is no discussion of reduction of
duties on apparel. I did forget to mention that we’ll also provide money out of this
funding to Maldives, which also has a great need, and our intention is to provide
that money to the Maldives National Fund for Reconstruction, and we’ll work with
the Government of the Maldives to select specific projects that we will work on.
Question: (Dumeeta Luthra, BBC) I just wanted to ask, this $40 Million, is that
capital being deferred, or is that interest, and will there be interest over the four
years. I don’t know if I missed that earlier.
Ambassador Lunstead: The $40 Million is the amount of payment which is due by
the Government of Sri Lanka to the United States this year, so that would be both
principle and interest. I don’t have a breakdown on it; if anyone’s interested we can
find somebody to look into that. What was the second part of the question?
Question: (Dumeetha Luthra, BBC) There will be interest accruing on the
restructured loan?
Ambassador Lunstead: I believe not, but I would have to check on that and we can
get back to you.
Question: I am Prasad from Rupavahini (state-owned television). There’s an
initiative between the Government and the LTTE to build a joint mechanism on
tsunami development. As an international donor, how does the United States see
the situation?
Ambassador Lunstead: Well, we believe that a joint mechanism between the
government and the LTTE would greatly help in the effectiveness of the relief and
reconstruction effort in the North and the East and we support the initiative, the
efforts, of the President and the Government to finalize such a mechanism.
Question: I’m from ABC news. With the U.S. Government be channeling any aid for
LTTE controlled areas through any of the NGOs?
Ambassador Lunstead: Well, on the emergency relief assistance, which we have
already done, we’ve provided assistance to a number of NGO’s which operated
throughout the country, including in LTTE areas. The assistance, which we intend
to do, which I’ve mentioned, will be used throughout the country. I don’t think we
have specific plans for using it in LTTE areas.
Question: There’s no specific channeling of money through NGOs to LTTE
controlled areas?
Ambassador Lunstead: No, we’ve never done that.
Question: (Dilip Ganguly, Associated Press) Under the existing laws you cannot
channel even indirectly into an area controlled by the LTTE?
Ambassador Lunstead: That’s not true. The law says we can’t do anything that
would provide material assistance to the LTTE because it’s listed as a terrorist
organization. We can provide humanitarian assistance in LTTE controlled areas
and we have done that through international NGOs who have received grants from
us for various activities.
Question: Mr. Ambassador, I’m from the Daily Mirror newspaper. Two quick
questions. Number one, when will the $650 Million dollars be allocated to separate
countries, and number two, have you been in communication with any specific
ministry with regards to the debt deferral, maybe the Finance Ministry? Have you
discussed anything concrete?
Ambassador Lunstead: We’ve had discussions for the past several months with the
Finance Ministry about the debt issue, so that is ongoing discussions.
Question: What has the Government response been?
Ambassador Lunstead: Well, the Government is interested in debt deferral, but it
had to see the final details, and now that we have the details we’re in further
discussions with the government. Oh, the first question – we will have the first
breakdown in, shall we say, a few weeks. That’s a very vague answer but I don’t
have anything more specific than that. But we expect that within the next few weeks
we’ll have a specific breakdown.
Question: You mentioned certain trade concessions that involves accumulation of
GSP plus benefits. Could you elaborate what does this mean?
Ambassador Lunstead: I was afraid you were going to ask that. (Laughs). I’ll have to
get somebody to get back to you on it with the details. It’s a technical trade question
and I don’t have more than that on it, but I can have someone call you about it if
you want to leave your name and number.
Question: (Dilip Ganguly, Associated Press) One point I found very interesting, one
hundred playgrounds for kids? Whose idea was that?
Ambassador Lunstead: Do you want to talk about the playgrounds, Andrea?
USAID Acting Mission Director Andrea Yates: Shortly after the tsunami we were
looking for ways to have what are called safe spaces for families, communities, but
especially for children to gather, to play, to interact, to have something to do, and
also to get them back to a normal daily life, attitude, etc., and one of the things we
looked at was replacing and repairing playgrounds. We fortunately were able to get
funding through – or will be able to get funding through – the supplemental bill that
the Ambassador has been talking about. We also have funding from the Bush-
Clinton fund; they raised funds from a variety of sources including private sector
and the U.S. – individual schools, etc. There were actually thousands of donors who
contributed to that fund, and we also have money from a third organization called
Joint Distribution Committee, JDC, and combined, that’s going to allow us to build
one hundred playgrounds. We have in country right now this week a team of
people, mostly through the National Recreation and Parks Service Association of
the United States and one of their jobs is to look at playgrounds, age-specific,
cultural-specific safety issues, placement, all of those things, and they’re in Sri
Lanka right now, looking at sites, talking to organizations, talking to our government
partners about where these might be placed.
Ambassador Lunstead: This is a great example of what we call a public-private
partnership, where we have money and expertise from the public sector and the
private sector coming together, and we do want to mention the contribution of the
JDC, the Joint Distribution committee, which is a relief and reconstruction branch of
the American Jewish Committee which is operating here in a number of different
areas now.
Question: (Inaudible.)
USAID Acting Mission Director Andrea Yates: And that’s one of the issues that
certainly we’re looking at. The areas are going to be identified through working with
local NGOs and local communities. The government may provide some of the land.
In some areas, there are going to be playgrounds existing, destroyed, and they’re
going to be replaced. The land that will be used is not necessarily suitable for
housing.
Question: (Dumeetha Luthra, BBC) The donors’ conference this weekend… Will
you be attending and what are you expecting to come out of it?
Question: (V.S. Sambandan, The Hindu – inaudible)
Ambassador Lunstead: So we’re changing subjects, is that it? Ok, Donor’s
Conference, I’ll be attending, Andrea will be attending. We hope to have a frank
report from the government on its plans. The conference of course, is not just
about reconstruction, but also about the entire poverty reduction and economic
growth strategy of the government, so we hope to have a report from the
Government for its plans on the entire economic growth package, and a frank
discussion between multilateral and bilateral donors and the government on how to
move forward.
Question: (Dumeetha Luthra, BBC) How disappointed are you that a joint
mechanism hasn’t been signed before this conference?
Ambassador Lunstead: Was than an attempt to put words in my mouth? (Laughter).
As I said before, we think that a joint mechanism would be a very effective way to
improve delivery of reconstruction assistance to the North and the East so we hope
that it will happen as quickly as possible. You asked about President Clinton – you
really need to talk to the U.N. about this because President Clinton will be coming
under his U.N. hat, but I believe he’ll be coming at the end of the month and
spending some time in Sri Lanka and in Maldives, but it’s really, you have to talk to
the U.N. about it because it’s their baby.
Question: The U.S. is not going to put any pre-conditions on setting up a joint
mechanism with the LTTE? The U.S. will never the less go ahead with giving out
whatever aid they have allocated?
Ambassador Lunstead: Our aid, our assistance reconstruction program will move
forward, yes, but we do think that the signing and implementation, which is really the
hard part of a joint mechanism, is important both for the reconstruction process and
for the entire political process for progress in the peace process.
Question: But it’s not a prerequisite?
Ambassador Lunstead: No, no. We’ve never said that.
Public Affairs Officer Philip A. Frayne: Ok, thank you very much.
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