Oceans Roundtable

MS. HARF: Hi everybody. Thank you to everyone for coming today. For those of you who I haven’t met, I’m Marie Harf. I’m the deputy spokesperson here. We’ll be moderating today’s discussion. We have several very distinguished speakers with us: Under Secretary of State for Economic Growth, Energy, and the Environment Cathy Novelli will kick us of today. We also have the OES Deputy Assistant Secretary David Balton with us. This is all on the record, no embargo in any way for any of this.

As you know, the Secretary will be dropping by at some point during this conversation to make a few remarks and just take a couple of questions because his schedule is pretty tight, but he wanted to come have a discussion with you as well.

So with that, I’m going to turn it over the Under Secretary, I think will have some remarks, and then we’ll open it up to your questions and we will just go around the room when we do so.

UNDER SECRETARY NOVELLI: Okay, great. Well, thank you all for being here. And I thought I could start by just giving you a little bit of a picture of what we’re expecting to have happen on Monday and Tuesday, which is that – the days that the Secretary is hosting the Our
Ocean conference. And when we started to look at this question, this was really the very first thing the Secretary talked to me about working on when he and I talked about me coming to the State Department. And I was absolutely delighted to be able to lead on this, because these are critical issues and they’re becoming more critical as time goes on.

And so when we looked at this conference and what we could do, we decided to focus it so that we could also focus results. And so we focused it on three areas, which are overfishing and illegal fishing, pollution of the ocean, and ocean acidification. And those three areas were areas that we arrived at in consultation with a number of eminent oceans experts, including our own oceans experts internally here at the State Department, but also in the NGO and the scientific community.

And the idea behind this conference is a slightly different one than all of the other very excellent conferences that have gone on, and that is that we wanted to look at the fact that we can’t solve these problems simply by government-to-government action; that all layers of society need to play a role here, and that includes individuals, it includes scientists, governments, the NGO community, and the private sector. And so we’ve designed a conference that actually gets all of those layers of society in one place to work on concrete solutions to these problems.

And the other thing that has struck me about working on this conference is that it is – obviously the ocean is vast and these problems are large and they are things that actually threaten our wellbeing, our livelihood, our environment, but there are people solving these issues around the world. And so one of the other things that we did is went out through our embassies to every space in the world to try to find the most credible people who are solving some of these problems in their own communities, in their own ways, to bring them to this conference so that we can have a conference that is looking at what is the path to solutions on this. And then sort of build from that at the end of the conference a list of policy direction that we can all take and that we can all agree is what we need to be doing at these various layers, so that we’re not just having a conference where everybody comes and talks; we’re having a conference where concrete things are occurring, where we’re setting up a path for more concrete things to occur through other conferences, other fora, and through a set of principles that governments, the private sector, NGOs, and regular people are going to be able to focus on.

And so the first thing that we’ve done in preparation for this is to do a social media campaign. You may have seen the Secretary’s call to action that he’s put out, and we’re getting a great response on that. And the idea behind that was to figure out, okay, what are the things, simple things, that individuals can do that are going to make a difference. So we asked them to do three things: only eat sustainably-caught seafood, not pollute the waterways and the oceans, and volunteer one day a year to clean up the waterways or the beaches.

And we’re getting – we’re putting that out there. We’re expecting a response. That’s obviously the layer, the individuals. There’s deeply scientific layers that look at things like ocean acidification, what does that mean, and how do we mitigate it. There are technical layers about how do we track fish so that we know whether they’ve been caught legally or illegally so that people can know whether their seafood has actually been caught sustainably or not. And all of these different things are what we’re going to be discussing at the conference.

So that is the idea that we’re going to have concrete results, that we’re building towards more concrete results in the future, with a pathway of how to get from point A to point B. And I don’t mean to suggest this is simple; it’s not. It’s very complicated. But it is also solvable, and that’s what we want to put the emphasis on, that we actually really can change the environment and change the way that these things are being addressed so that we do have sustainable fish for a huge percentage of the population that relies on it as its main source of protein, so that we have something that is economically sound and is creating and sustaining jobs, and so that we are also sustaining our environment.

So I’ll stop there and just – I’m happy to take questions.

MS. HARF: Great. Any opening thoughts, or do you just want to go right into questions? We’ll go right into questions. (Laughter.)

PARTICIPANT: Couldn’t have said it better myself.

MS. HARF: Great. Well, let’s just open it up. Go ahead.

QUESTION: Michele Kelemen, NPR —

MS. HARF: Yes, and please do identify yourself.

QUESTION: Can you just talk about any – what sort of – is there money involved here, are there specific projects you’re funding, announcements that you’re expecting to make. Thank you.

UNDER SECRETARY NOVELLI: Yeah. We’re going to make very specific announcements. Those are going to be made at the conference, so I’m not going to go into those now. But there is money involved, there are specific actions involved, and there is going to also be sort of a path for the future. So we’re doing things today that are very tangible, and we’re also looking at technology and what can that do on some of these questions. So there’s some pretty cool technological things that we’re going to have developed and we’re going to be able to roll out at the conference. And there will be a concrete list of things that people are bringing to the table for this conference, and then a path for future things.

MR. BALTON: Not just the United States Government —


MR. BALTON: — there will be announcements by other governments, other organizations we fully expect.

UNDER SECRETARY NOVELLI: Right. And – right. And not just by governments, so —

QUESTION: And how many countries involved? How many —

UNDER SECRETARY NOVELLI: Over 80 countries will be here, and we’re going to have foreign ministers, we’re going to have environment ministers from those countries. And as I said we’re going to have NGOs from all over the world as well as business community. So – and then this will be livestreamed, so we’re hoping that all the people who have made these pledges to action, or a number of them, will be able to follow this live. And we’ve got this in an interactive way, so they’ll be able to actually feed questions in as the discussion goes on. We have put a premium on people showing rather than telling what the problems are, visually. So we expect this to be a very visually engaging conference as well, so that – I think it’s sometimes easier if you can just see the dead zone in the sea instead of just trying to imagine, for example, what that looks like.

QUESTION: Under Secretary, Juliet Eilperin with The Washington Post, can you both say first of all how many world leaders – have you now a final count of how many are coming? I know it’s a handful. And then the second question is: Clearly, the international community has tried to deal with climate change and had a number of problems in reaching it. And when you look at the oceans, more than half of it is on the high seas which isn’t in anyone’s exclusive economic zone. How do you think this can be different in terms of producing concrete results or a meaningful difference in a way we might not have seen through UN efforts on climate?

UNDER SECRETARY NOVELLI: Well, I think – for example, for fish, I think there is already the capability, technologically, for example, to trace where boats are. And so whether they’re in the high seas or not, you can know where they are, and that allows you then to figure out how they – are they fishing in a place where they’re supposed to fish or not? So I think there are some —

QUESTION: But that’s not in place, that technology.

UNDER SECRETARY NOVELLI: The technology is not in place everywhere.


UNDER SECRETARY NOVELLI: It exists. And some folks are using it and some aren’t, and that’s one of the things we want to try to push forward here, and we want to try to push forward how other countries can make sure that these things are used. There is a new treaty that – out there called the Port-State Measures Agreement that sort of exhorts countries and gives them tools to actually implement this type of thing. So we’re looking at trying to get more signatories to that through this conference and also to get the technology pushed out and have a discussion about how that works – also on the U.S. side.

So I think – I guess what I would say is – maybe slightly different – is that there are actual solutions that people are putting in place in this realm today that can serve as catalysts to do it on a wider basis. And so we have the tools, and I think that that makes this in some ways very granular, and that means that you can attack it more easily. And I don’t know if “attack” is the right word, but solve these issues more easily.

So – and I will say, I mean, there has been a groundswell of support from the NGO community about this, and they also have a number of very tangible initiatives that they have been working on with foreign governments, which we hope to bring to fruition and we expect we will at this conference. So it’s a real partnership at many levels. And I haven’t honestly heard, as I’ve traveled around talking to governments about this, anybody who says this is an insoluble problem. There’s no one throwing up their hands saying this is just impossible and the politics of this are such that we can’t do it. I’ve heard people saying, okay, we can march forward here and we can figure out this path, and that we want to be on that frame. And that’s why we’re doing it this way.

In terms of world leaders, we expect to have many heads of state here, many are from the smaller island countries where this is vital to their health. But as I said, we’re also going to have quite a cadre of environment ministers and foreign ministers here, too.

QUESTION: But when you say “many,” can you give a range?

UNDER SECRETARY NOVELLI: I think in terms of – a hand of heads of state. I think it’s less than a dozen. I don’t have the final count.

MS. HARF: We can get some of those final numbers for you as well.




MR. BALTON: Can I add one point to that? Would it be okay?

MS. HARF: Go for it.

MR. BALTON: So as someone who’s worked in this field for a long time, it is true, the solutions are out there. Often the missing ingredient has been political will, and what I see this conference as is a perfect opportunity to catalyze that will. That’s why we invited the types of people we did to this conference. We’re hoping to build political will towards these solutions.

QUESTION: I’m Suzanne Goldenberg from The Guardian. I know a few months ago there was talk with people from the Global Oceans Summit, David Miliband and (inaudible) – it was some of the ideas they were putting forward and there was consensus behind included a special police force of – a blue police force, sort of a water-borne version of blue helmets that would actually police the high seas – not necessarily boarding boats themselves, but using these kind of technologies that you mentioned. Is that something that the State Department would get behind?

And also would the State Department get behind a separate international organization for ocean how?

UNDER SECRETARY NOVELLI: I think – I guess what I would say is we think there is an awful lot already that’s out there in terms of organizations that are regulating fishing in particular. So I’m very aware of the great work that’s been done by David Miliband and that group of folks, and we expect several of the people who were the authors of that study to be at the conference. I – this – I have not, to be honest, heard of a police force of the high seas. That’s the first time I’m hearing of that. I think we’re – there are many mechanisms that are already in place, and I think the question is how do we get those to be optimal? And that’s what we’re looking at.

There can be also new things that if there’s a consensus around and we – that’s what we want to develop is a consensus. So I think that’s the best answer I can give you on that.


QUESTION: Jo Biddle from Agence France Presse. Hi, nice to meet you.

MR. BALTON: Nice to meet you too.

QUESTION: I wanted to ask about the possibility of expanding marine parks, particularly in U.S. borders. I believe some of the NGOs are saying this could be a major way that the United States could show leadership in this area. At the moment, about only – they estimate that – conservationists estimate that at least 30 percent of the oceans need to be covered by marine-protected areas. They’ve actually identified three specific areas of the United States – I’m sure, obviously, the Pacific atolls, the Marianas Trench, and the northwest Hawaiian Islands.

Do you anticipate that you will be making some announcements on this? Is this something that you would consider would be a good thing, and – or what are the problems of doing something like that? Does it impact with fishing, locals who are fishing, potentially, or something like that?

UNDER SECRETARY NOVELLI: So we absolutely believe that marine-protected areas are an important tool in conservation. And it’s – conservation’s important because you want to make sure that you have not just preservation of the environment, which is vital, but also you want to preserve fish so that the next generation of people who need to eat can do that. So marine-protected areas are important for many things; those are just two of them. We fully support marine-protected areas. We expect some announcements to come out of this conference, but we’re going to hold that until the conference. So —

QUESTION: And are you – kind of just to follow up, then, are you also pushing your partners around the world to do similar things on expanding marine parks?





QUESTION: Hi, I’m Matt Viser with The Boston Globe. I wonder if you could talk a little bit about the Law of the Seas Treaty. And Secretary Kerry in the Senate was pushing for that in 2012 and it did not pass. How does any of this relate to what’s in that treaty? Should the U.S. still be pushing to sign that? Can you just —

UNDER SECRETARY NOVELLI: Well, you know that the President at his West Point speech talked about the Law of the Sea Treaty and the need to move that forward. We have been leading on – particularly in the fisheries – conservation area despite the fact that we have not ratified the Law of the Sea Treaty. And we’re looking at these other areas – ocean acidification – where there’s a lot of technology, et cetera.

So we are continuing to lead whether that treaty is ratified or isn’t ratified. That said, it is a very important treaty and the President has already said we need to look at getting to a place where we can ratify this. And so we will be taking that up.

QUESTION: Do you know when? I mean, is there a time element to that and when that treaty could be taken up, or when efforts to push the Senate to take it up again might —

UNDER SECRETARY NOVELLI: People are talking about that internally and how we – it’s very important for economics, not just for conservation. It’s important for both things. And I think we need to make sure that that message is properly communicated to those who have to take the decision on whether they’re going to give their advice and consent. In terms of timing, I don’t have an answer for you on specific timing, but it is going to be something we’re going to work on.

QUESTION: Ian Urbina with The New York Times. Two questions: One, the UN agreement on biodiversity – will we hear much discussion of that and where the U.S. stands on it? And two, I know there are calls to expand the category of ships that are required to have AIS, especially fishing vessels more. Will that be an issue that gets discussed?

UNDER SECRETARY NOVELLI: So on the biodiversity, there is actually going to be a meeting going on in the UN at the same time as the conference, which the U.S. will be participating in. And I think this conference is really focusing on these kind of practical solutions, so I don’t expect we’re going to have a huge discussion of that, and that’s going to be going on in the UN, which is the proper forum for it to be going on. And your second question I’m going to defer to David, so —

MR. BALTON: So you’re right. There are requirements for many large vessels to have a variety of things, including AIS, and there is a – there are proposals out there in the – at the International Maritime Organization to expand the category of vessels that will be covered by these requirements, including more fishing vessels. And we do support that, yes. Whether it will happen anytime soon, I don’t know, but I expect it will come up at the conference as a step that we need to take.


QUESTION: Neela Bannerjee with The Los Angeles Times. I wanted to return to something that Mr. Balton said about this being an opportunity to catalyze political will. Where are the areas specifically that you feel like political will is most lacking and that needs an extra push? That’s the first thing. And then the second question is: We’ve talked a lot about fishing and pollution, but what are some of the ideas that would be put forward to deal with the ocean acidification?

UNDER SECRETARY NOVELLI: Mm-hmm. So I think political will is needed in all three of these areas. That’s why we picked them. So each area – overfishing, pollution of the ocean, which – a lot of the pollution of the ocean comes from runoff of fertilizer overuse as well as from plastics that don’t biodegrade, and so that is absolutely going to be discussed. And the third thing, ocean acidification, is obviously related to climate change. And in terms of that, one of the things that is true is that we don’t know everything about where – oh, the Secretary’s coming, so I will finish that after.

SECRETARY KERRY: Hi, folks. How are you all?

MR. BALTON: Morning.

SECRETARY KERRY: Hey, Marie, how are you?

MS. HARF: Good.



SECRETARY KERRY: Hi, everybody.


SECRETARY KERRY: Good morning to you.

QUESTION: Good morning.

SECRETARY KERRY: I’ll run around and say hi to everybody.

(Introductions are made.)

MS. HARF: So everyone, as I said, this is all on the record. The Secretary will make some remarks, and then I think he probably has time for just a few questions. So no embargo.

SECRETARY KERRY: Absolutely. Great.

MS. HARF: I’ll turn it over to you, sir.

SECRETARY KERRY: Thank you, Marie. Thank you very much. Thanks, Cathy.

Well, let me begin by saying I am really excited by this conference which has been long in the making, since the moment I arrived here. In fact, I had wanted to do this when I was chairman of the Senate Foreign Relations Committee, and we began to plan some original efforts and then we ran out of time because they appointed me to something else. (Laughter.) So we just brought it over here and a few people like Marie and others to work on it.

The oceans are a passion of mine and always have been, from the time I was three years old or whatever and dipped my toes into Buzzard’s Bay and watched a lot of people from Woods Hole Oceanographic mucking around in the seaweed in the shallows getting specimens and doing research, and I began to wonder, sort of what is this all about? And for years and years, needless to say, have appreciated our oceans and have traveled many of them in the United States Navy across the Pacific on a ship, and went through Leyte Gulf and into the Philippines, and down to the Coral Sea and down to New Zealand and back through Samoa, and saw a lot of detritus and impacts of civilization, as we call it, on the ocean.

And then as chairman of the fisheries subcommittee in the United States Senate on the commerce committee, became deeply involved in protecting migratory species, dealing with tuna, with salmon, the Columbia River; with various laws that are supposed to regulate growth and development along the ocean border, like the Marine Mammal Protection Act or the Coastal Zone Management Act, the flood insurance, et cetera, which I rewrote as a senator. And I think I rewrote the Magnuson fisheries acts on several different occasions – not think, I know I did. (Laughter.) And then we rewrote them and changed them, working with Ted Stevens, who was a great collaborator with me on this when we were either chair or ranking member, et cetera. And we constantly were fighting to get additional science done, research money, and monitoring and other things, but I’m jumping ahead. Ted and I took the driftnet fishing to the United Nations. We managed to get driftnet fishing banned, ultimately, at the UN in the international process, though there are still some pirates out there who illegally fish and strip-mine the oceans, which is what they were doing.

So I learned during all of this process that a huge percentage of what fishermen fish is called bycatch and it’s just thrown overboard. Sometimes 50 percent or two thirds of a particular catch could actually be bycatch and thrown overboard. And through this process over the years, I became aware of this body of water we call the world’s oceans – ocean, which is actually 75 percent of Earth. The vast majority of Earth is not earth at all, it’s ocean. And some people have pointed out occasionally you could’ve called the planet Ocean rather than Earth. But we actually – according to some, and evolution – once spent a fair amount of time in the ocean. The – and much of the Earth’s surface was covered by the ocean that isn’t covered even today, as we all know from geology.

But what’s important to us today is that the ocean is the essential ingredient of life itself on the planet. In terms of oxygen, carbon dioxide, ecosystem, ocean currents, temperatures, life itself on Earth – if we did not have a 57 degree average temperature, which is what we had up until recent years, you wouldn’t have life the way we have it on the planet. And it is interacting deeply with the oceans and flow of the oceans. We depend on the oceans not just for oxygen and nutrients and protein, fish; there are – maybe 13 percent of the world’s population is completely dependent on the ocean for its input. But it also is essential to regulating climate around the planet, as well as major ecosystems. For instance, the Gulf Stream is an example of that.

Increasingly the ocean is threatened. The reason for this conference is very simple: The world’s oceans, as vast as they are, as much as they elicit a sense of awe for size and kind of power – they are under siege from a combination of acidification that takes place through the CO2 that falls into the ocean, which is changing ocean species and environment; it is under threat from pollution, a vast amount of pollution that spews off of land, flows down from places like the heartland of America, where farming practices wind up putting a certain amount of nutrients into the Missouri River, which flows into the Mississippi River – or any other river out of there, Ohio or otherwise – down into the Mississippi, out into the dead zone, which is now famous. Well, there are a bunch of dead zones around the world as a result of these things.

And ultimately, the third great danger is overfishing. Most of the world’s major fisheries are being overfished. Not all, but most. And some have a better process of regulation than others, but the problem with it is there’s a great debate over the science. There’s a great battle for who’s right and how do you base a regulatory rule on something if you don’t really know. And so there’s been always – I learned this firsthand in Massachusetts in our relationship with fishermen, that there’s this violent sense of injustice done when the regulators regulate, because the captains don’t believe the science on which the regulation is based. And so you have this disrespect, to some degree, and even flaunting in other instances, of the regulations. And most profoundly, you have a lack of monitoring and a lack of enforcement. So it’s all well and good to have some rule or regulation, but if it doesn’t get – if it’s not enforced, it’s like not having it at all.

So these are the problems we face, and we’re going to talk about this at a very well-attended, broadly represented conference that will have the prime minister* of Norway, the – Prince Albert of Monaco, the foreign minister of Chile, a number of government officials, a number of private sector entities, heads of major fishery corporations and Roger Berkowitz of Legal Sea Foods, an example – I mean, people who are stakeholders. We will have environmental and oceans experts, ocean scientists, a lot of visual presentation, a lot of presentation that people can really grab onto and understand. National Geographic, Cousteau Society, all these players are going to be involved in this conference that’s going to take place. It will be highly interactive and really give people an opportunity to be able to understand this.

I mean, part of it is an educational awareness-creating initiative, but it’s also – and this is very important – we didn’t want to just have a conference for the sake of it and have everybody talk and go away and not feel as if something can happen. And so building on other conferences – and there have been a lot of good conferences. I’ll give you an example. Jim Kim of the World Bank will be here and the World Bank’s been involved in this a little bit, and they’re making new policies in terms of how they can also help to protect the oceans and so forth. And we want to come out of it with an action agenda, and that’s our goal – is to set up a set of principles, declarations if you will, coming out of Washington, out of the Washington conference that can guide and impact choices on a global basis and build as we go into other conferences, which inevitably we’ll take in other meetings where we try to coalesce global action around this effort to protect the oceans.

That’s why I did that event when I was down in Bali with the fishermen down there. A huge percentage of fishermen – of Indonesians are fishermen. A huge percentage of the population there relies on the fish, and many of those fish come straight to Boston restaurants and New York restaurants and California. They’re huge suppliers to us, so it’s a global network. We’re all involved in it, and that’s the bottom line.

MS. HARF: Great, thank you. I think we have just time for two quick questions if folks are interested in typing.

SECRETARY KERRY: Anybody have a question?

MS. HARF: He answered everything.

SECRETARY KERRY: I answered everything. (Laughter.)

QUESTION: So quite a —

SECRETARY KERRY: Cathy will do in my absence. She’ll fill you all in, Marie, everybody.

MS. HARF: Let’s just do – did anyone – yeah, Juliet. Did you have one?

QUESTION: Well, I’m just wondering if you could say – just broadly, the U.S. traditionally has been a leader on this issue. There’s been plenty of people who would say in the last few years, whether you’re looking at whaling or climate or a number of things that other countries, including even small ones, have done things much more aggressively on the ocean than the United States. What do you think it would take beyond holding this conference to make the U.S. a leader in this? And given that much of this is going to be done through the President’s executive authority, what do you see are the possibilities and the limits to that given congressional resistance to some of it?

SECRETARY KERRY: Well, I would contest the notion that the U.S. hasn’t been a leader in this. I think we have been in our Magnuson Fisheries Act, in other efforts we’ve taken – I mean, the Coastal Zone Management Act, the flood insurance – we’ve done a lot of things to curb building, which other countries haven’t done. We’ve done a lot of things in terms of certain fisheries – manage them that other countries haven’t done. We do boast both Woods Hole Oceanographic and Scripps, two of the world’s premier research entities. So I think I’m not going to back off on our role, but we can do more. We can do better science, we can do better monitoring, we can do – we certainly could do better on climate change and emissions and so forth which have a profound impact on fishing.

But look, we’ve done a lot. We’ve done a lot with HFCs; we did a lot with acid rain. And there are other countries in Asia particularly that haven’t done enough on something like acid rain, and that has a profound impact on fisheries and so forth. So it’s a mixed bag and that’s exactly what we’re going to talk about here – who needs to do what, how, and what we can all do.

MS. HARF: Great.


QUESTION: Can you just talk – can you just give a couple —

MS. HARF: One more from Michele.

QUESTION: — maybe just a couple examples of what you hope to come out of this? I mean, I understand the action agenda, but how much money do you expect —

SECRETARY KERRY: We have a very solid action agenda. I think you’ve gotten some sense when I talk about monitoring or I talk about science. We obviously need to do more of both. There are other things we need to do, and we need to agree on fishing practice. I mean, there are a lot of things we need to do, and let’s let the conference sort of develop that, and it’ll unfold in the course of it, and that’ll make you have to come and pay attention to all of it. (Laughter.)

MS. HARF: Great. Thank you all so much and we’ll stay and answer some more questions.

SECRETARY KERRY: Great, all right. Thanks, everybody.

QUESTION: Thank you. Great.

UNDER SECRETARY NOVELLI: So you want me to finish?


UNDER SECRETARY NOVELLI: I was just on a separate vacation. (Laughter.)

QUESTION: No, I don’t even —

QUESTION: You kind of – you sort of talked about this too and I guess – I think what all of us are sort of getting at are the specifics within these three main priorities, right?


QUESTION: Like he mentioned, for example, runoff issues, right?


QUESTION: So – and you mentioned that too as well. So what are – if political will is lacking, then what are – like, what would you really like – like, say under each of these categories, right – the three categories – can you name two things that you would like to see action on, right? Is it runoff, is it pollution? What is it exactly?

UNDER SECRETARY NOVELLI: Well, so on ocean acidification, one of the things that is really important there is, while we know the ocean is acidifying more, we don’t know – it’s not, like, uniformly doing that and it’s not doing that in a constant way. So we would like to see, for example, much more monitoring in a more thorough way so that, for example, shellfish farmers can have some early warning, if a big wave of acidification’s coming their way, that they could actually take some measures to mitigate that with their farms.

So that’s – those are some concrete things, and we actually have a shellfish farmer who is partnered with the state of Washington in this very – it’s a high-tech and low-tech way to be able to do just that. So part of that is figuring out mitigation, part of that is figuring out – as the Secretary said – what is the science and trying to set a baseline. So those are some concrete things in that space. Clearly there’s a whole climate change piece that’s going on in a separate place, and we’re not going to tackle that here because it’s already going on someplace else, but we’re sort of tackling what we can tackle at this moment.

On the fisheries side, I think that several of the issues – we’ve already highlighted what they are. How do you credibly trace where things are coming? What are the right regimes to have in place so that if your population says, “Is my seafood sustainably caught,” they can get a reliable answer – yes, that is? So we’re looking at that.

On the pollution side, I think there’s two aspects to it. One is: What are the scientific/technical things that need to be done to address this question of runoff? Are there things that can be done about how fertilizer is used, how it’s formulated, so that it is creating less of a problem when there’s some runoff into the waterways. Are there things that can be done on the science of plastic to make it more biodegradable? What can be done on recycling so that you’re actually having less things go into the ocean? So those are some specific things, and we’re trying to look at it that way.

QUESTION: So but, I mean, for example, with runoff, you’re having to deal with other federal agencies, right?


QUESTION: I mean, don’t you have to deal with EPA, USDA?


QUESTION: And I mean, as somebody who covers the environment, we have people who are really reluctant to go after Big Ag on anything. So how do you resolve that?

UNDER SECRETARY NOVELLI: Right. Well, there’s all of the U.S. Government agencies that are involved in that are going to be here. We are also having folks involved in the industry here. And I don’t think we’re going to solve that as a huge problem and we’re not going to completely solve it at this conference. I think the idea though is that we can point the way to what we need to be doing very concretely so that things can progress and can be followed up on and can be measured. And that’s what we’re looking at trying to do.

QUESTION: Okay. I had one thing.


MR. BALTON: So just following up from what Secretary Kerry said in further answer to your question on fishing, which is clearly what I think he’s – thinks about most when he thinks about the oceans. Anybody who is looking at world fisheries would say there’s two big problems we need to find solutions. We need to end overfishing – and there are a lot of steps to take to do that. We’re actually doing a pretty good job in the United States on that, by the way. And while we may not be able to end illegal fishing totally, there are a lot of things we can do to stop illegally harvested fish from entering the stream of commerce. Those are two big things we really hope to drive forward in this agenda for fisheries at our conference.

QUESTION: What about whaling, since you mentioned that the prime minister of Norway is coming?

UNDER SECRETARY NOVELLI: Well, we – there are lots of issues about whaling. We aren’t planning on having the conference focus on whaling per se, but we obviously oppose whaling that is not scientifically justified. And we urge countries to not engage in those practices.

QUESTION: Two questions. One I doubt you’ll answer. (Laughter.)

MS. HARF: I love when I get those in the briefing. (Laughter.)

UNDER SECRETARY NOVELLI: Boy, that’s nice of you to —

MS. HARF: I know.

QUESTION: My favorite color is blue. (Laughter.)

MS. HARF: Those are my favorite.

QUESTION: I hear a lot of griping within NOAA about enforcement cutbacks and budget cutbacks (inaudible). So that’s the one that – (laughter). The question, I guess, is will NOAA be there.

UNDER SECRETARY NOVELLI: NOAA will absolutely be there.

QUESTION: Is there any discussion of reversing the trend of funding cutbacks or enforcement cutbacks?

UNDER SECRETARY NOVELLI: Well, NOAA will be there and they are fully supportive of this agenda. In fact, they’ve been very enthusiastic of working with us on this. So I guess that’s about as far as I can go.

QUESTION: Yeah. And then the other question, I guess, is magic pipe cases. And DOJ – over the last decade DOJ’s really been effective and aggressive in going after intentional polluting. So will there be a panel or something – some presentation that DOJ is going to put on about intentional dumping or magic pipe cases?

UNDER SECRETARY NOVELLI: I don’t – that wasn’t – no.

MR. BALTON: There’s nobody from DOJ presenting.


MR. BALTON: That topic is likely to be touched on. It’s not a problem only in the United States, right? So a lot of the speakers who are coming from other countries will describe their version of this issue.

QUESTION: Can I ask a Legal Seafoods question given that the Secretary brought that up?


QUESTION: Their CEO is legendary for backpedaling on this and saying that he does not serve consistently sustainable seafood. It’s widely known he’s boycotted basically anyone who upholds sustainable seafood does not go to Legal Seafoods. So I guess obviously he could be giving a policy announcement that would change that, but I was just wondering if you could explain why someone who’s actually made his mark by questioning the value of only serving sustainable seafood would come to a conference on the oceans.

UNDER SECRETARY NOVELLI: Well, we have to have everybody come here. I mean, we have to get everybody on the bandwagon to go in the right direction. And he’s well aware of the purpose of the conference, and so I think the fact that he’s chosen to come is – I have no understanding that he’s coming here to preach everybody should eat unsustainable seafood. (Laughter.) So I think actually we have been pretty clear about wanting folks who are coming with solutions to be here and to be speaking. And —

QUESTION: Does he have a speaking role?


MR. BALTON: No. But there are a lot of people in the – who are promoting sustainable seafood —

UNDER SECRETARY NOVELLI: — who are coming.

MR. BALTON: — who are coming. Monterrey Bay has their card. The Marine Stewardship Council has – their processor, actually a proliferation of these, and virtually all of them are represented in our conference.

UNDER SECRETARY NOVELLI: And the CEO of Bumble Bee Tuna is going to be speaking. So —

QUESTION: And will Roger Berkowitz be listening to those people who are coming? (Laughter.)

UNDER SECRETARY NOVELLI: Well, if he didn’t want to listen to them, then I assume he wouldn’t have showed – I can’t speak for him, right? So you’ll have to ask them.

QUESTION: So is he just an attendee? I mean, he’s attending?

MR. BALTON: So there are almost 400 people coming to the conference. There are speaking roles for maybe 20 or 30, right? Just the way these conferences work.

QUESTION: Are there people you wish were coming who are – who couldn’t, who are either major violators or potentially good partners or both on some of these issues who are not coming?

UNDER SECRETARY NOVELLI: I think we’ve tried —

QUESTION: I mean representatives of countries or —

UNDER SECRETARY NOVELLI: We tried to invite a very broad swath of folks. And when you have over 80 countries represented, that’s – I think we think that’s a pretty good swath of people. I don’t think we had anybody turn us down who we asked to come.

QUESTION: Really? So there’s not – there’s somebody – there aren’t certain empty places at the —


QUESTION: Yeah. At the table that you wish were – if there’s somebody you – some country that you wish or some entity that you wish were represented and is not?

UNDER SECRETARY NOVELLI: No. Actually, no. I mean, this is a pretty robust group of attendees. And we – like I said, nobody turned us down. I mean, some individual people had scheduling conflicts, but in terms of the countries we are extremely represented across the whole globe.

MR. BALTON: India had an election just a few weeks ago.


MR. BALTON: And so their new foreign minister was not – couldn’t make it on the schedule, but there will be Indians at the conference, just to give you an example.

QUESTION: As well as Chinese —


MR. BALTON: Yes. In fact, the head of the State Oceanographic Administration, Administrator Liu, will have a speaking role at our conference.

QUESTION: And Southeast Asia – are there people from there?


MS. HARF: A few more. Anyone? A few more last questions?

QUESTION: This is a novice question that’s not really important. But my understanding is that the European Union is on the cusp of deciding whether to impose some sort of ban on South Korean fish and that next year sometime the U.S. will be engaging in a similar analysis. That – so will that topic be part of next week’s discussion?

UNDER SECRETARY NOVELLI: Do you want to take that?

MR. BALTON: Yeah. So Maria Damanaki, who is the commissioner for the EU who does Maritime Affairs and Fisheries is coming. She actually also has a speaking role at our conference. And she’ll be talking about the – I assume – the EU’s approach to trying to prevent illegally harvested fish from entering their market.

We have our own approach to doing that that’s not entirely similar to the EU’s but maybe growing more similar over time. Yes, the EU is looking at Korea among other countries and maybe headed to a decision. I don’t know. You’ll have to ask her when she’s here. And we have our own process of going through fishing practices by other countries under the Magnuson-Stevens Reauthorization Act, and countries who are having vessels engage in these practices are put on notice by us and it can ultimately lead to trade sanctions against them.

MS. HARF: I think that’s all the time we have today. We will be doing a transcript of this, so I know you all took very good notes, but we will get you that as soon as it’s done. Any follow-ups, of course you know how to find me or anyone else in the Press Office. And we’re looking forward to next week. Thanks for coming today.

*foreign minister

Remarks by National Security Advisor Susan E. Rice Keynote Address at the Center for a New American Security Annual Conference

The White House

Office of the Press Secretary

For Immediate Release

June 11, 2014

Remarks by National Security Advisor Susan E. Rice
“The Strength of American Leadership, the Power of Collective Action”

Keynote Address at the Center for a New American Security Annual Conference
Washington, DC

As Prepared for Delivery

Thank you so much Richard for that kind welcome.  And, to my good friends and former colleagues— Michele Flournoy and Kurt Campbell— I can’t help but note how well-rested you both look.  I’m only a little bitter.  Still, I want to thank you for your stellar service to our country both from inside government and now, again, as leading thinkers on national security.

CNAS, which you founded, does a remarkable job of preparing our next generation of national security leaders.  That work is critical, because our nation needs bright, dedicated young women and men who care deeply about our world.  We need a diverse pipeline of talent ready and eager to carry forward the mantle of American leadership.  So, thank you all. 

As President Obama told West Point’s graduating class two weeks ago, the question is not whether America will lead the world in the 21st century, but how America will lead.  No other nation can match the enduring foundations of our strength.  Our military has no peer.  Our formidable economy is growing.  We are more energy independent each year.  Our vibrant and diverse population is demographically strong and productive.  We attract hopeful immigrants from all over the world.  Our unrivaled global network of alliances and partnerships makes us the one nation to which the world turns when challenges arise.  So, American leadership is and will remain central to shaping a world that is freer, more secure, more just and more prosperous.

At West Point, President Obama outlined how America will lead in a world that is more complex and more interdependent than ever before.  As we move out of a period dominated by the wars in Iraq and Afghanistan, we will lead by drawing on every element of our national power.  That power starts with our unparalleled military might, used wisely and when necessary to defend America’s core interests – the security of our citizens, our economy, and our allies.  We will lead by strengthening effective partnerships to counter an evolving terrorist threat.  We will lead by rallying coalitions and marshaling the resources of our partners to address regional and global challenges.  And, we will lead by standing firm in defense of human dignity and equality, while steering the course of history toward greater justice and opportunity for all. 

Today, I’d like to focus on one pillar of that strategy—mobilizing coalitions.  Indeed, galvanizing the international community to address problems that no one nation can solve alone is the bread and butter of our global engagement.  And, in many ways, it’s both the hardest and the most important element of how America leads on the world stage.          

This concept is not new.  Collective action has long been the hallmark of effective American leadership.  The United Nations, NATO and our Asian alliances were all built on the foundation of American strength and American values.  American leadership established the Bretton Woods system and supported open markets, spurring a rapid rise in global living standards.  Nor is this approach the province of one political party.  It was President Reagan who negotiated the Montreal Protocol, hailed today as our most successful international environmental treaty.  President George H.W. Bush insisted on UN backing and assembled a broad coalition before sending American troops into the Gulf.  And, President Clinton led the campaign to enlarge NATO, opening Europe’s door to the very nations who, as Secretary Albright put it, “knocked the teeth out of totalitarianism in Europe.”  Our history is rich with successes won not as a lone nation, but as the leader of many. 

Now, our approach must meet the new demands of a complex and rapidly changing world.  The architecture that we built in the 20th century must be re-energized to deal with the challenges of the 21st.  With emerging powers, we must be able to collaborate where our interests converge but define our differences and defend our interests where they diverge. Our coalitions may be more fluid than in the past, but the basics haven’t changed.  When we spur collective action, we deliver outcomes that are more legitimate, more sustainable, and less costly.   

As global challenges arise, we turn first, always, to our traditional allies.  When Russia trampled long-established principles of sovereignty, territorial integrity, and international law with its illegal annexation of Crimea, the United States rallied the international community to isolate Russia and impose costs. With American leadership, the world condemned the seizure of Crimea through an overwhelming vote in the UN General Assembly.  We expelled Russia from the G8.  Last week, the G7 met for the first time in 17 years, and we continued to concert our approach to Ukraine and other pressing global challenges.  We’ve reinforced the unity of our NATO Alliance and bolstered our commitment to Article 5.  President Obama has pledged to invest an additional $1 billion to bolster the security of our Eastern European allies against threats or intimidation.  More U.S. Army and Air Force units are now deployed to Central and Eastern Europe, more American ships patrol the Black Sea, more American planes police the Baltic skies.  And, meanwhile, with the support of the international community, Ukrainians have the chance to write a new chapter in their history. 

By working in lockstep with the EU and other partners, we imposed sanctions that are biting the Russian economy.  The IMF, the World Bank and private sector estimates all suggest that $100-200 billion in capital will flow out of Russia this year, as investors move their money to more reliable markets.  Russia’s economy contracted in the first quarter, and the IMF has declared that the country is likely in recession.  Its credit now rates just above junk status.  Russia has lost standing, influence, and economic clout by the day.  With our closest partners—Europe, the G7 and other key allies —we continue to send a common message:  Russia must cease aggression against Ukraine, halt support for violent separatists in the East, seal the border, and recognize the newly elected Ukrainian government.  If Russia does not, it faces the very real prospect of greater pressure and significant additional sanctions.

The speed and unity of our response demonstrates the unique value of America’s leadership.  Unilateral sanctions would not have had the same bite as coordinated efforts with the EU.  American condemnations alone do not carry the same weight as the UN General Assembly.  Bilateral U.S. assistance to Ukraine could not match the roughly $15 billion IMF program.  And, for our Eastern allies, American security guarantees are most powerful when augmented by NATO’s security umbrella.  

The United States’ commitment to the security of our allies is sacrosanct and always backed by the full weight of our military might.  At the same time, we expect our partners to shoulder their share of the burden of our collective security.  Collective action doesn’t mean the United States puts skin in the game while others stand on the sidelines cheering.  Alliances are a two-way street, especially in hard times when alliances matter most. 

As we approach the NATO summit in Wales this September, we expect every ally to pull its full weight through increased investment in defense and upgrading our Alliance for the future.  Europe needs to take defense spending seriously and meet NATO’s benchmark—at least two percent of GDP—to keep our alliance strong and dynamic.  And, just as we reassure allies in the face of Russia’s actions, we must upgrade NATO’s ability to meet challenges to its south—including by reinforcing the President’s commitment to build the capacity of our counterterrorism partners. 

Likewise, our historic alliances in Asia continue to underwrite regional stability, as we move toward a more geographically distributed and operationally resilient defense posture.  In the face of North Korea’s increasing provocations, we’ve developed a tailored deterrence strategy and counter provocation plan with South Korea, and we are updating our defense cooperation guidelines with Japan for the first time in almost two decades.  We aim also to deepen trilateral security cooperation and interoperability, which President Obama made a central focus of his summit with the leaders of Japan and Korea in March and his trip to the region in April. 

Improved coordination is a necessity in the Middle East as well.  The 35,000 American service members stationed in the Gulf are a daily reminder of our commitment to the region and clear evidence that the United States remains ready to defend our core interests, whether it’s disrupting al-Qa’ida or preventing Iran from developing a nuclear weapon.  At the same time, we look to our partners, both individually and through the Gulf Cooperation Council, to cooperate on missile defense and develop other critical deterrence capabilities, including in the spheres of counter-piracy, maritime security, counterterrorism and counter-proliferation. 

America will always maintain our iron-clad commitment to the security of Israel, ensuring that Israel maintains its qualitative military edge and can protect its territory and people.  Equally, we consistently defend Israel’s legitimacy and security in the UN and other international fora.  In turn, we expect Israel to stand and be counted with the US and other partners on core matters of international law and principle, such as Ukraine.

Drawing on the strength of our alliances and the reach of our partnerships, the United States’ brings together countries in every region of the world to advance our shared security, expand global prosperity, and uphold our fundamental values.    

Let me start with our shared security.  To responsibly end our war in Afghanistan, President Obama first rallied our NATO allies and ISAF partners to contribute more troops to the coalition, surging resources and helping Afghan forces take charge of their nation’s security.  As we bring America’s combat mission to an end, we’ve enlisted our allies and partners to make enduring commitments to Afghanistan’s future—so that Afghan Security Forces continue to have the resources they need, and the Afghan people have our lasting support.

Partnership is also the cornerstone of our counter-terrorism strategy designed to meet a threat that is now more diffuse and decentralized.  Core al-Qa’ida is diminished, but its affiliates and off-shoots increasingly threaten the U.S. and our partners, as we are witnessing this week in Mosul.  The United States has been fast to provide necessary support for the people and government of Iraq under our Strategic Framework Agreement, and we are working together to roll back aggression and counter the threat that the Islamic State of Iraq and Levant poses to the people of the region.  Yet, as President Obama said at West Point, we must do more to strengthen our partners’ capacity to defeat the terrorist threat on their home turf by providing them the necessary training, equipment and support.  That is why the President is asking Congress for a new Counterterrorism Partnership Fund of up to $5 billion to assist nations on the frontlines of terrorism to fight al-Qa’ida, its affiliates, and groups that embrace its violent extremist ideology.   

To shrink terrorist safe-havens and end civil conflicts, which can be breeding grounds for transnational threats, we continue to lead the international community to strengthen the foundations of peace and security.  The U.S. is the largest supporter of UN peace operations, which both reduce the need to deploy our own armed forces and mitigate the risks that fragile and failed states pose.  When violence in South Sudan broke out in December, and the world’s youngest country reached the brink of all-out war, the United States led the Security Council to augment the UN mission in South Sudan and re-focus it on protecting civilians, while we recruited, trained and equipped additional peacekeepers.  Since December, nearly 2,000 more troops have surged into South Sudan, with approximately another 1,700 expected this month. 

In Syria, by contrast, we have seen the failure of the UN Security Council to act effectively, as Russia and China have four times used their vetoes to protect Assad.  With fighting escalating, terrorist groups associated with al-Qa’ida are gaining a greater foothold in Syria, the horrific humanitarian costs are mounting, and the stability of neighboring countries is threatened.  So, while Russia and Iran continue to prop up the regime, the United States is working with our partners through non-traditional channels to provide critical humanitarian assistance and, through the London-11 group, to ramp up our coordinated support for the moderate, vetted Syrian opposition— both political and military.      

Yet, even as we strongly oppose Russia on Syria and Ukraine, we continue to work together to eliminate Assad’s chemical weapons and to prevent Iran from obtaining a nuclear weapon.  We built an unprecedented sanctions regime to pressure Iran while keeping the door open to diplomacy.  As a consequence, working with the P5+1, we’ve halted Iran’s progress toward a nuclear weapon and rolled it back in key respects.  Now, we are testing whether we can reach a comprehensive solution that resolves peacefully the international community’s concerns about Iran’s nuclear program and bolsters our shared security.

In today’s world, the reality is: many transnational security challenges can only be addressed through collective action.  Take the threat of nuclear material in terrorist hands.  One unlocked door at any of the facilities worldwide that house weapons-usable material is a threat to everyone.  That’s why President Obama created the Nuclear Security Summit.  So far, 12 countries and 24 nuclear facilities have rid themselves of highly-enriched uranium and plutonium.  Dozens of nations have increased security at their nuclear storage sites, built counter-smuggling teams, or enhanced their nuclear security training.  Our nuclear security regime is stronger today, because we created a coalition to address the problem, and we’ll keep the momentum going when we host the fourth Nuclear Security Summit in 2016.

Consider, as well, infectious diseases like MERS, bird flu or Ebola, which present yet another type of threat to our security.  In 2012, 80 percent of countries failed to meet the World Health Organization’s deadline for preparedness against outbreaks.  The international community needed a shot in the arm.  So, the United States brought together partners from more than 30 countries and multiple international institutions to develop the Global Health Security Agenda, which we launched in February.  Our strategy, backed by concrete commitments, will move us towards a system that reports outbreaks in real time and ensures nations have the resources to contain localized problems before they become global pandemics.

As we confront the grave and growing threat of climate change, the United States is leading the world by example.  As National Security Advisor, part of my job is to focus on any threat that could breed conflict, migration, and natural disasters.  Climate change is just such a creeping national security crisis, and it is one of our top global priorities. 

Our new rule, announced last week, to reduce carbon pollution from power plants by 30 percent compared to 2005 levels is the most ambitious climate action ever taken in the U.S.  It’s the centerpiece of our broader climate action plan.  And, as we work toward the meeting in Paris next year to define a new global framework for tackling climate change, we’re challenging other major economies to step up too.  We’re working intensively with China, the world’s biggest emitter, to bend down their emissions curve as fast as possible.  We’ve built international coalitions to address short-lived climate pollutants like black carbon, HFCs and methane.  And, we’ve led in encouraging private investment in green infrastructure projects overseas, while reducing incentives for high-carbon energy investment.    

Our security also relies on defining and upholding rules that govern our shared spaces—rules that reject aggression, impede the ability of large nations to bully smaller ones, and establish ways to resolve conflicts peacefully.  A key element of our Asia Rebalance is collaborating with our partners to strengthen regional institutions and international norms.  That’s why we are working with ASEAN to advance a code of conduct for the South China Sea that would enhance maritime security, reinforce international law, and strengthen the regional rules of the road. 

Similarly, we are building partnerships to set standards of behavior to protect the open, reliable, and interoperable Internet, and to hold accountable those who engage in malicious cyber activity.  That’s why we’re working with our partners to expand international law enforcement cooperation and ensure that emerging norms, including the protection of intellectual property and civilian infrastructure, are respected in cyberspace.   For example, last week, working with 10 countries and numerous private sector partners, we successfully disrupted a “botnet” that had been used to steal hundreds of millions of dollars and filed criminal charges against its Russia-based administrator.  Last month, the Department of Justice indicted five Chinese military officials for hacking our nation’s corporate computers, making it clear there’s no room for government-sponsored theft in cyberspace for commercial gain.  We are working with our allies through efforts like the Freedom On-Line Coalition and the Internet Governance Forum to preserve the open Internet as driver for human rights and economic prosperity.

This brings me to the second key reason we mobilize collective action—to expand our shared prosperity.  In 2009, facing the biggest financial crisis since the Great Depression, President Obama led to establish the G20 as the premier forum for international economic cooperation.  We needed more voices at the table, writing the rules for the global economy and committing to dramatic measures to restore growth.  Our efforts included mobilizing more resources for the IMF and World Bank to support the most vulnerable countries.  And, thanks to a broad and concerted international effort, the global economy has turned the corner.

Last year, we played a key role in enabling the 157 members of the WTO to reach a landmark agreement that will modernize the entire international trading system.  In every region of the world, we’ve brought nations together to increase trade and develop high-standard agreements to further boost growth and job creation.  This is a key pillar of our rebalance to Asia, where we’re working with 12 economies, representing almost 40 percent of global GDP, to finalize an ambitious Trans-Pacific Partnership.  With the Trans-Atlantic Trade and Investment Partnership, we’re taking what is already the largest trading partnership in the world to a new level.  To increase trade both within Africa and between Africa and the United States, we will join with Congress to extend and update the African Growth and Opportunity Act before it expires next year. 

In regions brimming with economic potential, including Africa, Latin America and Southeast Asia, we’re supporting entrepreneurship and fostering private sector investment.  Our Power Africa initiative will double access to electricity across the continent through more than $15 billion in private sector commitments.  We’re assisting young people throughout Africa and South East Asia to develop their business and entrepreneurship skills, as well as their leadership. 

As we approach 2015, we’re pressing our partners to deliver on the Millennium Development Goals and to devise bold new goals that will guide the next phase of the fight against poverty.  Building on the extraordinary progress in many developing countries, our approach isn’t simply about pledging more money, it’s about bringing together resources and expertise from every sector to do more with what we have and to support models of economic growth that fuel new markets.  We’re building public-private partnerships, investing in academic breakthroughs, supporting non-profits that translate ideas into action, and creating stronger connections among them all.   

Take, for example, the progress we’ve made in agricultural development.  Back in 2009, at the G8 meeting in L’Aquila, President Obama made food security a global priority backed by billions of dollars in international commitments.  In 2012, the President launched the New Alliance for Food Security and Nutrition, which has now grown to ten African countries, more than 160 companies, and delivered more than $7 billion in responsible planned investments in African agriculture.  And through our Feed the Future partnerships, millions of smallholder farmers are planting better seeds, using better fertilizers, and seeing their incomes rise. 

Which leads me to the third key reason we mobilize collective action.  For, however much we might like to, we rarely can force nations to respect the rights of their citizens.  So we must catalyze the international community to uphold universal values, build broad coalitions to advance human rights, and impose costs on those who violate them.  

Human rights must be protected for everyone, especially traditionally marginalized communities such as ethnic or religious minorities, LGBT persons, migrant workers, and people with disabilities.  That’s why President Obama decided to join the UN Human Rights Council, so we could lead in reforming that flawed institution from within.  In fact, we have made it more effective.  Because of our efforts, the Council has spent far more time spotlighting abuses in Qadhafi’s Libya, Syria, Sudan, North Korea and Iran than demonizing Israel. 

At the same time, the Open Government Partnership initiated by President Obama in 2011, has grown from eight countries to 64, all working together to strengthen accountable and transparent governance.  Our Equal Futures Partnership unites two dozen countries in a commitment to take concrete steps to empower women in their societies both economically and politically.  And, as civil society comes under attack in more and more places, we’re bringing countries and peoples together to counter restrictions and strengthen protections for civil society.

Moreover, we’ve focused the global community on elevating that most basic aspect of human dignity—the health and well-being of the most vulnerable people.  We’re partnering with nations that invest in their health systems.  We’re working with NGOs to improve child and maternal health, end preventable diseases, and make progress towards a goal that was inconceivable just a decade ago—the world’s first AIDS-free generation. 

Across all these vital and far-reaching challenges, we continue to bring the resources of the United States and the reach of our partnerships to bear to forge a safer and more prosperous world.  Our goals are bold and won’t be realized overnight, but the essence of U.S. leadership, as always, remains our ambition, our determination, and our dauntless vision of the possible – the pursuit of a world free of nuclear weapons; a world where extreme poverty is no more; where people are free to choose their own leaders; and where no child’s potential is cut short by a circumstance of her birth. 

We’ve earned our unparalleled position in the world through decades of responsible leadership.  We affirm our exceptionalism by working tirelessly to strengthen the international system we helped build.  We affirm it daily with our painstaking efforts to marshal international support and rally nations behind our leadership.  We affirm it by taking strong action when we see rules and norms broken by those who try to game the system for their own gain.  As President Obama told those graduating cadets at West Point, “What makes us exceptional is not our ability to flout international norms and the rule of law; it’s our willingness to affirm them through our actions.” 

As we leave an era of American foreign policy dominated by war, we are in a much stronger position to shape a more just and secure peace.  In doing so, we will be vigilant against threats to our security, but we also recognize that we are stronger still when we mobilize the world on behalf of our common security and common humanity.  That is the proud tradition of American foreign policy, and that is what’s required to shape a new chapter of American leadership.

Thank you very much. 

Commission points to innovation reforms to sustain economic recovery

European Commission

Press release

Brussels, 10 June 2014

Commission points to innovation reforms to sustain economic recovery

The European Commission has today highlighted the importance of research and innovation (R&I) investments and reforms for economic recovery in the European Union, and made proposals to help EU Member States maximise the impact of their budgets at a time when many countries still face spending constraints. Increasing R&I investment is a proven driver of growth, while improving the efficiency and quality of public R&I spending is also critical if Europe is to maintain or achieve a leading position in many fields of knowledge and key technologies. The Commission has pledged support to Member States in pursuing R&I reforms best suited to their needs, including by providing policy support, world-class data and examples of best practice.

Olli Rehn, Vice-President of the European Commission responsible for Economic and Monetary Affairs and the Euro, said: “The European economic recovery is gathering speed while the pace of fiscal consolidation is slowing down, in line with the EU’s reinforced fiscal framework. Nonetheless, budgetary constraints will remain, which is why.it is more important than ever that Member States target their resources smartly. The EU budget is helping drive growth-enhancing investment in research and innovation and today we are putting forward ideas to help maximise the impact of every euro spent.”

Máire Geoghegan-Quinn, European Commissioner for Research, Innovation and Science, said: “Fostering innovation is widely accepted as the key to competitiveness and better quality of life, especially in Europe where we cannot compete on costs. This is a wake-up call to governments and businesses across the EU. Either we get it right now or we pay the price for years to come.”

The Communication published today highlights three key areas of reform:

  • Improving the quality of strategy development and the policy-making process, bringing together both research and innovation activities, and underpinned by a stable multi-annual budget that strategically focuses resources;

  • Improving the quality of R&I programmes, including through reductions of administrative burdens and more competitive allocating of funding;

  • Improving the quality of public institutions performing research and innovation, including through new partnerships with industry.

The Commission has also called on Member States to prioritise R&I, as public authorities regain margins for growth-enhancing investment. With current R&I spending across the public and private sector worth just over 2% of GDP, the EU remains well behind international competitors like the United States, Japan and South Korea, with China also now very close to overtaking the EU (see graph). Increasing R&I spending to 3% of GDP therefore remains a key target for the EU, but the Communication today shows that improving the quality of public spending in this area is also essential in order to increase the economic impact of investment. The Communication points equally to the need for the EU needs to put in place the right framework conditions to encourage European companies to innovate further.

Public and private R&D intensity in 2012 in the EU and some third countries


Innovation is central to economic growth and business competitiveness, and is at the heart of the EU’s Europe 2020 strategy. Today’s proposals follow those of the 2014 Country Specific Recommendations where a number of Member States received recommendations to reform their research and innovation policies. The Commission has also issued today a State of the Innovation Union report demonstrating progress against the 34 commitments made and highlighting the need for further efforts.

The EU budget for 2014-20 marks a decisive shift towards R&I and other growth enhancing items, with a 30 % real terms increase in the budget for Horizon 2020, the new EU programme for research and innovation. A further EUR 83 billion is expected to be invested in R&I as well as SMEs through the new European Structural and Investment Funds.

Innovation Union: http://ec.europa.eu/research/innovation-union/index_en.cfm

Horizon 2020: http://ec.europa.eu/programmes/horizon2020/


Daily Press Briefings : Daily Press Briefing: June 4, 2014

12:57 p.m. EDT

MS. HARF: Hello, welcome to the briefing. I have a quick travel update at the top, and then I’m happy to get to your questions. As you all now know, the Secretary is in Beirut, Lebanon today meeting with a range of Lebanese officials to discuss the impact of the Syrian crisis on Lebanon and other shared concerns as well. This – this is the first Secretary visit in five years, and he will be going back to Paris this evening. Tomorrow, he’ll be following much of the President’s schedule in Paris. He will also be meeting with Russian Foreign Minister Lavrov. And I think that’s it.


QUESTION: Great. Thanks. So first off, just to follow up on that, he’ll be meeting with Lavrov? What is the topic?

MS. HARF: I’m imagining they’re going to be discussing a range of topics, most importantly Ukraine.

QUESTION: Ukraine. Okay. So that’s where I wanted to go.

MS. HARF: Mm-hmm.

QUESTION: I’m sure you’ve seen the reports out of Luhansk about the separatists overrunning two government bases there. I see that, in his comments with President Poroshenko today, President Obama discussed additional assistance for law enforcement, and – assuming that’s a civilian law enforcement or police force, because he made the distinction between military forces and civil – law enforcement?

MS. HARF: It’s a little of both, I think. So let me just detail a little bit of it, and then we can —


MS. HARF: — go into that more. So the White House, as you know, today announced $5 million in new security assistance. This new assistance will go for night vision devices, body armor, and additional communications equipment. It’s my understanding that’s going to the Ministry of Defense, actually.


MS. HARF: And that, obviously, adds to what we’ve already given, which is 23 million in total, including the last 5 million. Fifteen million has gone to the ministry of defense, and 8 million has gone to the State Border Guard Service.

QUESTION: Okay. He did make the distinction between law enforcement and also military troops. He talked about the night vision goggles for the military forces. I’m just wondering if there’s anything else that might be going for law enforcement forces in some of the eastern regions.

MS. HARF: I can check. I don’t have any more additional details. I know they put out a fact sheet as well, but we can see if there’s anything else. And we continue to evaluate requests from the Government of Ukraine.

QUESTION: Okay. What do you make of this new offensive by the separatists?

MS. HARF: Well, I would say a few points. Look, the first is – and I have a little bit on this. Just give me one second. We have – in addition to what you mentioned, noted that Ukraine’s operations in some of those regions you mentioned have also entered a new and more active phase. So we have said all along that the Ukrainians have shown remarkable restraint in the face of unacceptable Russian-backed aggression, but that they do have a responsibility and a duty to protect their citizens. That’s why you’ve seen us continue to support them, like some of the ways I just talked about.

So the situation on the ground is obviously fluid and fast-moving, but we have repeatedly throughout this called on the Russians to use their influence with the separatists, to ask them to cease what they’re doing, to stop taking government buildings, to stop their offensives. And have yet have not seen any movement in that area, but hope we will.

QUESTION: Are the Ukraine forces still referring to this – or the government still referring to this as a counterterrorism operation, or —

MS. HARF: I can check on the exact wording they’re using.

QUESTION: Okay. I mean, I know there was some discussion earlier about whether or not that was an appropriate term to use when we we’re talking about – I mean, whether or not they’re backed by Russians, they’re still Ukraine citizens, no?

MS. HARF: Well, some of them.

QUESTION: Some of them at least.

MS. HARF: Right. So some of them certainly are Ukrainian, some of them are from other places, as we’ve seen in the press. But look, in terms what word we use, I think that’s less important, quite frankly, here than the fact that we’ve said the Ukrainians have a responsibility and an obligation to protect their citizens, all of their citizens in all of their regions, including all of the parts of the east, and that the Russians should use their influence with these groups, whatever we want to call them, to pull back.

QUESTION: Thank you.

MS. HARF: Mm-hmm. Anything else on Ukraine?


MS. HARF: Yes, Said.

QUESTION: Now, you are saying that you want the Russians to use their influence with the separatists. The Russians want you to use your influence with the Ukrainian Government. They’re saying that they should – you should use your influence to stop attacks.

MS. HARF: That the Ukrainian Government should stop defending its own territory?

QUESTION: Okay. So —

MS. HARF: See, that’s a false logic on the Russian part, though, Said.

QUESTION: Okay. All right. So everything that the Ukrainians are doing, I just want to understand your position correctly – everything that they are doing is actually self-defense, correct?

MS. HARF: They’re – I mean, look, I mean, I don’t want to use the term self-defense, but this is Ukrainian territory that they are defending —

QUESTION: They defend – right.

MS. HARF: — from incursions from people that are backed by another government, and in the case of Crimea actually was annexed by another government.

QUESTION: Okay, so —

MS. HARF: So it’s not one-to-one.

QUESTION: Okay. You just preempted my next question, which is they – what about Crimea? Does it fall under that? Ukrainian?

MS. HARF: Still part of Ukraine.

QUESTION: Okay. Now – and a quick follow-up: You’re saying that they are – some of them are Russians, suggesting that some or maybe many are not Russian. Do you have any percentage or breakdown?

MS. HARF: Well, I said some are Ukrainians.

QUESTION: Right. I’m saying, are some of them —

MS. HARF: Well, any percentages? I can check with our folks and see. I don’t know if we have that kind of clarity.

QUESTION: I mean, some of the ethnic Russians are Ukrainian citizens; some are not.

MS. HARF: Uh-huh. We’ve seen some Chechens recently. We’ve seen others. So —

QUESTION: Okay, and that’s my last question. Are you – because the charge was made last week that some Chechen fighters were being sort of ferried by the Russians across the border to go and fight in Crimea. Do you have any more details on that?

MS. HARF: Well, I mean, without a doubt, we have seen the numerous reports now that armed Chechen fighters have traveled from Russia, particularly to Donetsk, to support the Russian-backed separatists. How they get there I think we’re still looking for more details on, but there’s no question that we’ve seen some go there. And I don’t have more details for you on that right now.

QUESTION: So Marie —

MS. HARF: Yeah.

QUESTION: — the U.S. isn’t concerned that some of the actions by the Ukrainian forces, particularly in places like Luhansk, are excessive? We see numbers of deaths on the part on the sides of the rebels. You’re not worried that some of that is excessive actions?

MS. HARF: So I think I’d make three points here. The first is that in any armed conflict, there are going to be casualties on each side, right? Here, we have not seen any credible reports of things like human rights violations by the Ukrainian Government. There are a variety of reports out there. Obviously, it takes some time to run these down on the ground. I don’t want to rule it out completely, but we as of this point haven’t seen credible reports of the kind of human rights violations or things like you mentioned.

QUESTION: Yes, please. Ukraine?

MS. HARF: Uh-huh.

QUESTION: I mean, at a certain point it was an issue raised about – that Ukraine is going to be – is at the edge of a civil war. You still looking that way, or just —

MS. HARF: We don’t look at it that way, because a civil war would imply that there are factions inside a country fighting each other. This is a situation where you have a country with an outside force that’s doing – that’s encouraging the fighting in some cases, like in Crimea, annexing it themselves, so that’s not a civil war; that’s another country messing around in its neighbor’s internal politics, which just a different thing.

QUESTION: And one of the things that you were pushing with the Ukrainian Government, or at least we call it the government of Kyiv at that point, you – the issue —

MS. HARF: I think you can call it the Ukrainian Government.

QUESTION: Okay. (Laughter.) Or Ukrainian Government —

MS. HARF: Uh-huh.

QUESTION: So it was asked – they were asked to make some modifications or whatever, the inclusiveness of the separatists or the pro-Russian entities, whatever, it was – it is still push this issue or —

MS. HARF: Are you talking about the constitutional reform process?


MS. HARF: Okay.

QUESTION: That – the term that you are using.

MS. HARF: Uh-huh. Yeah. So obviously, they’ve said they’re committed to that. President-elect Poroshenko, who the President met with today – Secretary Kerry did as well – these are things that he is going to, as he moves forward with his government, will be dealing with. They’ve said they’re committed to it.

QUESTION: So the —

MS. HARF: And we do believe it’s an important process.

QUESTION: What’s your understanding of what are the main challenges now facing Ukraine? Is the separatist movement or the economic crisis or the presence of Russian troops at the borders, or it’s not there anymore?

MS. HARF: Well, on the Russian troops, we’ve said they’ve been slowly moving back from the border, so obviously we believe they need to move quickly. But we have noted, in terms of the troops on the border, that they have been – many of them have moved, many of them have made preparations to move. They are moving slowly, but they’re working on that.

President-elect Poroshenko himself announced, I think, right after his election, that his number one priority after taking office will be to restore order in eastern Ukraine by increasing dialogue with citizens of that region, traveling to the area soon after his inauguration, and increasing the transparency of the ongoing constitutional reform process.

So I think there are a couple challenges, right? Ukraine is coming out of a time when it had a leadership that stripped its citizens of money and rights and ways to choose their own government, and that’s why you saw the Ukrainians come out and say that’s not okay and we want a new government.

So they have some economic challenges, certainly, which is why we’ve said we think it’s important to support them economically. There is a huge security challenge, too, and I think President-elect Poroshenko is focused on that.


QUESTION: Marie, how do you differentiate between this not being seen as a civil war in Ukraine, even though, as you just said, there are some Ukraine separatists – some of the separatists are at least are Ukrainian fighting against their government – and a situation like Syria, which I think the State Department, the Administration —

MS. HARF: Yeah, yeah.

QUESTION: — everybody acknowledges is a civil war —

MS. HARF: There wasn’t —

QUESTION: — when there are also outside forces?

MS. HARF: That’s true. The difference, I would say, is in Ukraine there was no violence before outside forces intervened. So in Syria, you had a situation where the government – Syrians rose up.

QUESTION: Except in, like, Maidan and places like that.

MS. HARF: But there – that wasn’t civil war-level violence, no. That was internal – it was things like we’ve seen elsewhere around the Arab world, for example. It was people rising up against their government. The government cracked down, and eventually the government fled. That’s not – we wouldn’t term that a civil war.

In Syria, when we started calling it a civil war, right, is when you had this local opposition rise up against the government, the government puts them down, and the armed opposition emerges, and there truly is a Syrian-on-Syrian civil war raging throughout all of Syria, basically.

And in Ukraine, there was no military-to-military level or style of violence. I mean, what happened on the Maidan was an uprising and the government putting it down violently.

QUESTION: Okay, but couldn’t you also argue that —

MS. HARF: There was no large-scale violence like we’ve seen until the Russians started messing around there.

QUESTION: Okay, but you could – one, I guess, could also argue that so much – so many regions of Ukraine at this point are fighting.

MS. HARF: A majority of Ukraine is still completely calm and violence-free – completely calm and violence-free. That’s why you saw with the elections a large, vast majority of the country go ahead to vote totally peacefully and freely.

So I – actually, in terms of where the fighting’s occurring, it really is in a very limited area, which again —

QUESTION: But that would – that could also include Crimea, could it not?

MS. HARF: Right. Still very limited. But again, there was no violent – I mean, you can talk about the violence in the square, but that’s a different kind of violence than we talk about with a civil war and that we talk about with what we’ve seen in Ukraine.

QUESTION: The upcoming talks between Secretary Kerry and Foreign Minister Lavrov.

MS. HARF: Yes.

QUESTION: Are you hoping that there may be some kind of way of resolving this? We’ve seen some troops move back – not all of them – but some move – troops move back from the eastern borders – two-thirds, you said. I wonder if you sort of see that there’s some chink, some possibility of an opening?

MS. HARF: I mean, we hope so, right? I don’t want to get ahead of a meeting that hasn’t happened or be overly optimistic. We obviously have always said there was a diplomatic off-ramp here, and that that’s why we were going to keep talking with the Russians. And if we can make some progress tomorrow, that would be great.

QUESTION: What would constitute progress for you?

MS. HARF: I think we’ll wait and see.

QUESTION: Are there any carrots being offered in these talks? Is the Secretary going to come offer some kind of – I don’t know —

MS. HARF: Well —

QUESTION: — olive branch or opening or —

MS. HARF: I don’t have anything to preview specifically about what he’ll say. But what we’ve said, broadly speaking, is that we have put a lot of pressure on the Russian economy, and that pressure will increase if we don’t see changes. And so I think the Russians know that they have a choice to make to continue with the actions and have more pressure, or to do the opposite.

QUESTION: So you’re talking about there could be an easing of the sanctions on the table if certain actions are taken by Moscow?

MS. HARF: Well, I think I was probably saying the opposite: that if certain actions aren’t taken, there will be more sanctions.

QUESTION: More sanctions.

MS. HARF: But no, I haven’t heard anyone talking about easing of sanctions. But again, like, that’s – eventually we would like to get to a place where we could do something like that. But we haven’t seen any indication that will be possible.

QUESTION: So is it purely coincidental, then, today that Germany’s just come out – warned again of – warned that there could be tougher sanctions against Russia?

MS. HARF: We’ve certainly been linked up with the EU. I know people think we haven’t been, but we’ve been linked up with the EU and all the countries quite closely on this, and it’s not coincidental. Look, I think we’re all talking about the fact that there could be more.

MS. HARF: Yeah. Ukraine?

QUESTION: Change of subject.

MS. HARF: Uh-huh.

QUESTION: Afghanistan. Have you seen the video released by the Taliban?

MS. HARF: I have.

QUESTION: (Inaudible.)

MS. HARF: Mm-hmm. And you would like a comment?


MS. HARF: Or a question? Besides have I seen it? I think I’d probably refer you to the statement by my colleague at the Pentagon, Admiral Kirby, who said we’re aware of the video allegedly released by the Taliban showing the transfer. We have no reason to doubt the video’s authenticity, but obviously they are reviewing it. Regardless, we know the transfer was peaceful and successful. Our focus, of course, remains on getting Sergeant Bergdahl the care he needs. I think DOD – if they have anything else to say, I’d point you there.

QUESTION: But did you know in advance that the Taliban had done a video recording of that? Was there any —

MS. HARF: I was not aware of that. I’m happy to check with my DOD colleagues.

QUESTION: Was there any understanding between the U.S. and the Taliban that this process would be video recorded, or —

MS. HARF: Well again, we weren’t negotiating directly with the Taliban. Qatar was. I don’t have any details on that topic. I’m happy to look into it further.

QUESTION: Can I follow up on that?

MS. HARF: Yeah.

QUESTION: Did any U.S. officials ever meet any members of the Taliban in connection with the possibility of Mr. Bergdahl’s release?

MS. HARF: Over the five years?

QUESTION: Correct.

MS. HARF: I will have to check, Arshad. I don’t know.

QUESTION: I’m pretty sure that – okay. Please do.

MS. HARF: Do you mean one on one, or with other people in the – or just at all?


MS. HARF: Okay. I’ll – I would need to check.

QUESTION: Okay. Because – and just so we’re clear, my follow-up is if it proves to be the case that there were actually meetings, then there is then the question of why any such meeting in connection with the possibility of Mr. Bergdahl’s release might not be construed as a negotiation.

MS. HARF: Okay. I’m happy to check.

QUESTION: Thank you.

MS. HARF: And there have – as you know now – been multiple sort of phases in this discussion about his release, so I just don’t have all the history. I’m happy to check.


QUESTION: Marie, would you like to —

MS. HARF: Wait, let me go – go ahead, Said. And then —

QUESTION: Go, Jo. I defer.

QUESTION: Oh, I just —

MS. HARF: We’re all so polite today.

QUESTION: Very polite today.

I just wondered if you had any concerns about the release of this video. Is it being used by the Taliban as some kind of propaganda value? I mean, they had – they blasted across it, “Don’t return to Afghanistan again. Next time, nobody will release you,” and they call it a ceremony for the handover of the soldier.

MS. HARF: Look, I think what we were focused on here is getting this American soldier home. Again, I think there might’ve been some confusion yesterday that the – how he ended up in Taliban captivity is wholly unrelated to whether or not we should’ve brought him home, and I think the Army and military leadership has spoke to that quite eloquently.

So we’ve been very clear about our feelings on the Taliban. The United States military has been very clear about the lengths they will go to take action against the Taliban. We’ve seen that. So I don’t think anyone should be confused or in doubt about the United States military’s willingness to go after the Taliban based on this.

QUESTION: Yeah, that wasn’t – thank you, but that wasn’t really quite my question.

MS. HARF: So I mean I don’t think —

QUESTION: My question is whether it has propaganda value for the Taliban.

MS. HARF: I don’t want to venture to analyze that. I think – I was trying to put it in the broader context of our activities against the Taliban, that it’s a video of us getting an American soldier home. And that’s important to us, and I think that is an important thing for the United States to say that we do no matter how they go missing, and I think on our – that’s how I would view it, at least.

QUESTION: (Inaudible.)

QUESTION: It – was it just a status —

MS. HARF: Wait, wait, hold on. Said and then Lucas. Said.

QUESTION: On the question of whether it (inaudible) —

MS. HARF: Okay, wait —

QUESTION: — whether it was propaganda.

MS. HARF: Lucas, go ahead. Yes.

QUESTION: On the question of whether this —

MS. HARF: There’s time for all of them. Go ahead.

QUESTION: Didn’t you say he was – we were being very polite today?

MS. HARF: I know. Go ahead, Lucas. (Laughter.)

QUESTION: On the question of if this is a propaganda video, this video is propaganda for the Taliban – would you say it’s just a status update on Facebook?

MS. HARF: I have no idea why – I will not venture to guess why the Taliban does things or why they release videos. As I said, what’s been important to us throughout this whole process is his health and safety, which, as you know, is why we had to move very quickly. Determining the facts now, which we just don’t know and which is very important to the Army – you’ve heard other people speak about it now today – not prejudging what those are. And look, if the facts lead one way, there will be consequences, of course. But what we’re focused on now really is his health.

QUESTION: Said, do you have a question?

QUESTION: Yeah, I have —

QUESTION: And then we’ll go back to Lucas. (Laughter.)

QUESTION: The broader —

MS. HARF: Look at how polite everyone is.

QUESTION: — you mentioned the broader context.

MS. HARF: Uh-huh.

QUESTION: Would you like to see this, in the broader context, lead to some sort of a negotiation with the Taliban where the United States can achieve some sort of a SOFA agreement where the border with Pakistan – you can negotiate with the Haqqani network and the border in Pakistan is more secure? Would you like to see that?

MS. HARF: That was just, like, 15 hypotheticals in one.

QUESTION: Well, I don’t know. Okay.

MS. HARF: I think – no, but more broadly speaking, Said —

QUESTION: It’s a good place to ask hypotheticals.

MS. HARF: — more broadly speaking, what we’ve said is if this could lead to progress on the reconciliation front —


MS. HARF: — that would be good. I don’t want to get too far ahead of this now because it’s a really tough challenge, right? We need there to be an Afghan-led reconciliation process where they talk about their future and they talk to each other about what would happen next. I don’t think I have much more analysis to do about what possibly could come from this. The President very clearly outlined the future of the United States in Afghanistan several times over the past few years, most recently, of course, in his announcement last week about our troop numbers and what our presence will look like there. So I think we’ve been very clear about the role we’re going to be playing.

QUESTION: So it is possible that this is not just an isolated negotiation for exchanging prisoners incident?

MS. HARF: Well, this was an isolated negotiation about the exchange of prisoners. But if it could lead to progress on reconciliation, which we’ve said is very important, then obviously that would be a good thing. We don’t know if it will, but if it could, that would be good.

Yes, going back to Lucas.

QUESTION: Former Secretary Clinton has spoken out —

QUESTION: I’ve got one on Afghanistan.

MS. HARF: I think this is about Afghanistan.

QUESTION: Yeah, this is – oh – this is – oh, yeah. We’re in Afghanistan still.


MS. HARF: We’re just staying on Afghanistan today.

QUESTION: (Inaudible) Benghazi.

QUESTION: No, no, no, we’re not going to Benghazi.

MS. HARF: (Laughter.) Go ahead, Lucas.

QUESTION: On the Bergdahl case —

MS. HARF: Uh-huh.

QUESTION: — former Secretary Clinton has spoken out, calling it one of the hard choices that top policymakers are often called upon to make. As we all know, this concept of a prisoner swap was first broached with the Congress in late 2011, early 2012. What view of the idea did Secretary Clinton take at the time and when she was serving in the President’s cabinet?

MS. HARF: I think I’d probably refer you to her to speak – I think she’s spoken about it now, and if she has anything else to say, I’m sure she’d be happy to provide it.

QUESTION: Published reports from then and now state that Secretary Clinton opposed the idea of a prisoner swap. Are those reports inaccurate?

MS. HARF: I’m – I know there are a variety of reports out there, and I know that one thing we said very clearly recently is that while we’ve been talking about this for a long time, the situation has continued to evolve; his health, we believe, continued to get worse; and the decisions we made now are not identical to the conversations that we’ve been having for years, just broadly speaking. So again, I’m happy to see if there’s more from her time here or more that she’d like to add, but she’s right. It’s a tough choice. I think what you’ve seen is complete unanimity throughout the Administration, both throughout the last six – or five years he’s been a captive, that we need to do everything we can to bring him home and what that looks like. And even some members of Congress, who were today criticizing us, have been on the record saying we’ll do everything to bring him home, including prisoner swaps.

So I think she’s right that it’s a hard choice and the choices we had in the last week were different than the discussions we were having two years ago.

QUESTION: At the time this – the idea was broached, what involvement was there in the intra-agency process from the State Department?

MS. HARF: Broached in terms of what? When?

QUESTION: Did the Department’s lawyers provide legal opinions? Did INL provide assessments?

MS. HARF: When are you referring to? Sorry.

QUESTION: In 2011, 2012, any time during Secretary Clinton’s term.

MS. HARF: I’m happy to check on what occurred previously. I’m obviously most familiar with what’s happened over the past few weeks. But I’m happy to check if there’s more detail.

QUESTION: Yes, please.

QUESTION: I have just one more.

MS. HARF: Uh-huh.

QUESTION: You might not – I don’t know if you know about this, because I’ve just been pinged it myself, but apparently —

MS. HARF: I love these.

QUESTION: — yeah, me too – there’s some breaking news. There’s another video which shows this young American couple who disappeared in Afghanistan a few years ago. Apparently they’re appealing for help. Do you know —

MS. HARF: Do you have a name?

QUESTION: I can’t remember their name. You might —

QUESTION: I know more about this. It’s – I don’t know the name, I will get it for you, but it’s a Canadian man and his wife who’s from Pennsylvania. They’re a young couple. The video shows her in an abaya with a hijab and they’re being held.

MS. HARF: Private citizens?

QUESTION: Yes. Civilians.

MS. HARF: Obviously, we have no greater priority than the protection of American citizens overseas. I’m not familiar with this, and obviously, there are always privacy concerns. I’ll check on it, though.

QUESTION: She was apparently pregnant, I think, when they disappeared —


MS. HARF: Okay. I’m happy —

QUESTION: — back in 2012.

MS. HARF: I’m happy to check. I know there are some privacy concerns, so let me just check.

QUESTION: Okay. Thank you.

QUESTION: But are there privacy concerns even if they have identified themselves?

MS. HARF: I’d have to check on the specifics.

QUESTION: Okay. Because the video shows them saying, my name is X, Y.

MS. HARF: Okay, I’ll check.


MS. HARF: Yeah, I’ll check.

QUESTION: Back to Secretary Clinton real quick.

MS. HARF: Uh-huh.

QUESTION: Just in general, was this the only option, the prisoner swap?

MS. HARF: Compared to what?

QUESTION: Well, Fox News’ Catherine Herridge is now reporting that this prisoner swap – that this was the second option, this was not the only option, that they had pursued another plan in December 2013.

MS. HARF: I’m happy to check on the details. Obviously, if there were other things considered – I think, broadly speaking, we’ve considered all options to get him back. This was judged to be – again, recently, we believe as General Dempsey said, this was the best, probably last chance to get him home. This was what we undertook in order to get him home. As we’ve said very publicly, we’ve been talking for a long time about a potential prisoner swap and what that might look like. I’m sure we looked at a range of options, but again, as – I will refer to General Dempsey’s comment that this was the best opportunity to get him home.

QUESTION: So cash payments were discussed?

MS. HARF: I can check on that. I don’t know, Lucas.

QUESTION: And were you – was the United States Government negotiating with the Pakistani Government?

MS. HARF: Negotiating with the – were they – I’m happy to check on those details. Again, I’m most familiar with the recent history here, but I’m happy to dig a little deeper.

QUESTION: On Afghanistan —

QUESTION: To go back to what (inaudible) just sent to me. (Laughter.)

MS. HARF: See, I wish I could have my phone up here because I feel like I’m at a disadvantage. You all have your phones.

QUESTION: And I need to pay tribute. It’s an AP story, AP. (Laughter.)

MS. HARF: I need to, like, be able to phone a friend. Yes.

QUESTION: It’s Caitlin Coleman and Joshua Boyle.

MS. HARF: Okay, yes. So again, as in these general types of cases, strive to remain in contact with the U.S. citizen’s family, provide appropriate consular access. About this case, because of privacy considerations, cannot provide additional details.

QUESTION: Thank you.

QUESTION: Just one Afghanistan?

MS. HARF: Uh-huh.

QUESTION: So yesterday you said you had a very short window of time for the prisoner swap.

MS. HARF: Mm-hmm.

QUESTION: And today you are saying that you had the best and the last opportunity. Did the Taliban give you a deadline for —

MS. HARF: I don’t have more details for you on the discussion – internal discussions between the Government of Qatar and the Taliban.

QUESTION: And exactly where this happened? Was it around – along the Pakistan border in Afghanistan?

MS. HARF: I’m happy to check if there’s more detail we can provide on that.

QUESTION: And did the U.S. also video record and took pictures of —

MS. HARF: Not to my knowledge. I’m happy to check.

QUESTION: Because the video didn’t see – I don’t see anything in the video that —

MS. HARF: I’m happy to check.

QUESTION: Was it a risky operation, do you believe?

MS. HARF: Was it a – I mean, look, every time – everything we do here in this part of the world entails some risk, absolutely. But we had, through our discussions with the Government of Qatar, come to an understanding about how this would occur. Obviously, there is always risk, but thankfully, this transfer went forward peacefully.

QUESTION: But did you take any backup precaution? Because we see Taliban fire fighters all around —

MS. HARF: I think the United States military always takes a lot of backup precautions, I would venture to guess.

QUESTION: Okay. Thank you.

QUESTION: Just to complete the idea of this contact with Taliban, is Taliban in any way part of the Afghanistan equation?

MS. HARF: Absolutely. They’re a huge power player there.

QUESTION: And do you have something for it, or because you – the reason I’m asking: It was 2012, I think, there was an office of Taliban opened in Qatar.

MS. HARF: Uh-huh, yes.

QUESTION: And I don’t know – I mean, I think that it was not even – I mean, it was – if not welcome —

MS. HARF: Briefly open.


MS. HARF: Uh-huh. Well, in terms of that, the Taliban did suspend direct talks in 2012, and we have not resumed them. As you mentioned, that office was/is still based in Qatar. Nothing to update you in terms of that. They remain suspended.

QUESTION: But this office was to contact other Afghanis or contact you?

MS. HARF: I think it was to be part of the reconciliation process, which of course we’ve said needs to really be Afghans talking to Afghans, but we obviously play – have some role here.


MS. HARF: Afghanistan?

QUESTION: New topic?

MS. HARF: Anything else on Afghanistan?

QUESTION: One more time: Can you confirm that cash options were considered in exchange for Bergdahl?

MS. HARF: I don’t know, Lucas. I’m happy to check and see if there are other options that were considered and if we can confirm them. I just don’t know.

QUESTION: But you can’t deny that cash payments were discussed?

MS. HARF: But I can’t confirm – I just – I can’t confirm it, so it’s not that I’m not denying it. It’s that I don’t know if it’s true or not. Yeah.

QUESTION: I have a legal question on —

MS. HARF: My favorite.

QUESTION: Well, it’s just – it’s very general, but it relates to this. When people are saying the U.S. does not negotiate with terrorist groups, is that statute or is that general policy? And —

MS. HARF: Well, our line is that we don’t make concessions —

QUESTION: That’s what I was about to ask you.

MS. HARF: — which is different. I mean, that’s the – you’re quoting it colloquial. That’s actually not what you’ll hear us say from the podium (inaudible).

QUESTION: Okay. And how do you define the difference?

MS. HARF: How do we define the difference? Well, I —

QUESTION: Between making concessions and negotiating.

MS. HARF: I think it’s clear that we don’t make concessions to terrorists. And that’s a judgment, right, that we don’t – I think – I don’t know. I think those words, using Matt, I think are fairly well defined.

QUESTION: So releasing five of their prisoners or five of their —

MS. HARF: Is not making a concession.

QUESTION: It’s not a concession?

MS. HARF: No. It is consistent absolutely with what’s happened in previous wars, including Korea, including Vietnam. I think one of the large tranches of prisoners in Vietnam, it was something like around 500 Americans for 1,200 North Vietnamese. So again, this has a long history in the United States of prisoner swaps.

QUESTION: But it allows you to keep – to hew to your policy just by how you define the word “concession.”

MS. HARF: No. Well, and let’s talk about these five a little bit, because I think it might be helpful. All of these five were eligible for review by the Periodic Review Board of Guantanamo Bay. So there are three buckets of people in Guantanamo that remain. There are those who are approved for transfer. That’s 78. There are about 30 who have been referred for prosecution in some way. These five are in that middle bucket and were unlikely – might have been, but unlikely – to be added to the group that was going to be referred for prosecution. So it is quite likely that eventually, in line with our commitment to close Guantanamo Bay, they would be transferred.

Now, I’m doing some hypotheticals and going out a little bit here, but I think it’s important to remember who these five were, what likely would have ended up happening to them. So let’s say it was important for us to get Sergeant Bergdahl home. Let’s say these guys may have eventually been transferred somewhere anyways. I think many of us would make the argument – I would make it – that we should get something for them.

QUESTION: Marie, so not making concessions does not preclude negotiating. Is that what you’re saying?

MS. HARF: I’m saying our policy is not to make concessions to terrorists.

QUESTION: I’m trying to understand, because this is the first I hear this. So suppose someone hijacks a plane and demands an hour on television, for instance.

MS. HARF: We don’t make concessions to terrorists.

QUESTION: That would be a concession. But to negotiate exchange of prisoners is different?

MS. HARF: But again, this was an exchange of prisoners in war.

QUESTION: Right, okay.

MS. HARF: Right? Let’s be clear about that. Operating under —

QUESTION: (Inaudible) legitimizes the Taliban to take prisoners of war, and now we’re doing this exchange with the Taliban?

MS. HARF: It’s – well, I don’t know what you mean by legitimizing. We have an authorization for the use of military force in Afghanistan partly because of – in large part because of the Taliban. So we are operating under an AUMF, congressionally approved AUMF. We are at war in Afghanistan. The Taliban was holding captive in a war zone our soldier. So operating under the long-established prisoner swaps that we’ve done – yes?

QUESTION: Yet all of the detainees in Guantanamo were specifically referred to as detainees and enemy combatants —

MS. HARF: Uh-huh.

QUESTION: — and not prisoners of war.

MS. HARF: And we talked about this a little bit yesterday that it’s the underlying principle that we exchange prisoners in war – whatever term we use for them, right? It’s not a technical term; it is a concept that these are prisoners we have taken during wartime, factually.

QUESTION: Well, detainees. I mean, every administration since 2001 – or I guess the two administrations since we opened Guantanamo – has made it very – I mean, have parsed it out to —

MS. HARF: Uh-huh. I understand that.

QUESTION: — ad nauseum that these are not prisoners, these are detainees.

MS. HARF: Right.

QUESTION: You’re not calling them prisoners of war. You’ve changed your language today and called them prisoners in war.

MS. HARF: I am not – right. I’m not changing the technical definition of what we call people incarcerated in Guantanamo Bay. I’m not changing that in any way, nor was this decision changing that in any way, period. And these five detainees went through the routine process we do for all Guantanamo detainees before they are transferred in terms of the mitigation to the threat, undertaking a review to make sure we are sufficiently assured that we’ve mitigated the threat as much as we can. We can never mitigate it 100 percent.

And again, that’s why I gave a little of the backstory on what’s happening to the rest of these prisoners at Guantanamo Bay and who’s slated for what. It was also, I think, important to remember that these five were taken and brought to Guantanamo very, very early on in the war in Afghanistan. It doesn’t mean they’re not bad guys, but it’s important for context to remember who these guys are in comparison. They weren’t, for example, on the list of about 30 that have been referred for prosecution.

QUESTION: Right. These are guys who were swept up on the battlefield —

MS. HARF: Mm-hmm. Very early on.

QUESTION: — and they were combatants.

MS. HARF: Very early on.

QUESTION: So let me ask this: I’m sure this is the case or I assume this is the case, but I just want to make sure. These five who were released, were they – did the Taliban specifically by name ask for these five, or did the Administration pick these five?

MS. HARF: I’m not probably going to go into more details about the back-and-forth negotiations. This was the agreement we ended up coming to.

QUESTION: Because it begs the question whether or not some of them could have come from the 78 who have already been cleared for transfer.

MS. HARF: None of them were in the 78 already cleared for transfer. They were all in this middle – and so everyone who’s not cleared for transfer already or has been referred for prosecution is eligible for review by the Periodic Review Board.

QUESTION: Correct. No, maybe I should be more clear.

MS. HARF: Yeah.

QUESTION: I mean, if given the choice, I assume the Administration would have picked five people who had already been cleared for transfer who have already been deemed not a threat to —

MS. HARF: I think we wanted – given the choice, we wanted to find an acceptable agreement where we could get our soldier back and feel like we sufficiently mitigated the risk for whoever we transfer.

QUESTION: So can I just ask —


QUESTION: — you’re making the argument that you should get something for these people, for these —

MS. HARF: I’m making the argument that if – if, and this is an if – I’m breaking my own rule – they someday were eventually going to be transferred, then if we could get something for them now, that is, of course, something that I think most people would agree with. But that – to be fair, the broader context about why this decision was made was because we felt like, again, we had a short-time window with Bergdahl —


MS. HARF: His health was declining. We needed to get him home and wanted to get him home, and that the Secretary of Defense had made, based on the interagency assessment we do when any – whenever a Gitmo detainee is transferred, had made the assessment that we had sufficiently mitigated the risk and it was in our national security interest to make this prisoner swap.

QUESTION: Yeah, okay. I understand that.

MS. HARF: Yeah.

QUESTION: But I’m just wondering more broadly now, does that mean that the others who are eligible for review or approved for transfer who remain in Guantanamo are now American bargaining chips?

MS. HARF: Well, there’s no —

QUESTION: In other situations.

MS. HARF: Well, there’s no other American POWs in Afghanistan being held by the Taliban.

QUESTION: No, but I mean there are other situations where there are Americans being held. Does that mean – I mean, I just think —

MS. HARF: I mean not —

QUESTION: — that their lawyers might have an issue with that if —

MS. HARF: Not – again, I’m not saying it’s a bargaining chip per se. I’m trying to put these five – I think people have – there’s been a little confusion out there about who they are and what was eventually going to happen to them. I was trying to put that into the broader context.

QUESTION: But you said that the argument was that we should get something for them, which means equally the argument could be made —


QUESTION: — for all those others.

MS. HARF: That’s not —

QUESTION: It could be made. I’m not saying it’s going to be made.

MS. HARF: Right. And I think every situation is different. We have a broad goal of closing Guantanamo Bay. If we can charge people, we will. When we can approve people for transfer through this interagency process, we’ll do that because we do at the end of the day want to close Guantanamo Bay. We had one American soldier who’s been a – who’s a POW in Afghanistan, so this is an incredibly unique situation, I would say, and wouldn’t compare it to any other detainees. And I wasn’t trying to set a precedent. I was just – I think people have had a little confusion about eventually what was going to happen to these five at the end of this.

QUESTION: Marie, a follow-up question to Arshad’s: How do you define concessions?

MS. HARF: I’m happy to see if there’s a legal definition for you.

QUESTION: And Marie, critics are – have said that this is a very bad deal, that these weren’t just five guys swept up on the battlefield in 2002, they were high-ranking Taliban officials, direct ties to al-Qaida, it was essentially the Taliban’s war cabinet – how is this a good deal?

MS. HARF: Well, first of all, our American POW is home and he’s going to be reunited with his family. So I think by any measure, that’s something that’s good.

QUESTION: Most would —

MS. HARF: Second —

QUESTION: Most would argue that an alleged deserter, outside of him being reunited with his family, that was not a good deal.

MS. HARF: I don’t think most would argue that, Lucas. I think you can look at what – first of all – well, I think you can look at what military leadership has said. Regardless of how he went missing, it is our duty to bring him home regardless. And I would trust our military leadership, Chairman Dempsey, the Secretary of the Army McHugh, and others who have spoken to this, Secretary Hagel. So that’s a separate conversation. They are doing an investigation now to determine the facts.

And I’m not saying we don’t believe anyone that’s come out. I think there’s been some confusion about this, too. I’m not saying that we – certainly we at the State Department aren’t doing the investigation, but people who are looking at it need to get all the facts. They will look at a variety of sources to get them. If there’s been misconduct, Chairman Dempsey was clear there will be consequences.

QUESTION: In 2010 the Pentagon did conduct an investigation and concluded that Sergeant Bergdahl walked off the COP.

MS. HARF: I think you’re misrepresenting that. First of all, DOD can probably speak more clearly to that. But again, in 2010 we didn’t have all the facts. Many more facts have emerged since then, including now the person at the center of this.

QUESTION: So if you didn’t have all the facts, why did you agree to this deal?

MS. HARF: I’m sorry?

QUESTION: You didn’t have all the facts when —

MS. HARF: Because as I said, the facts of how he got into Taliban custody have no bearing on whether or not we bring him home, period. Those are two separate questions. And we will look at all the information. We – I’m sure that people are talking to people he served with, they’re talking to him when they can when he’s in good enough health. And they – the Army has said that it’s launching a review. And look, if there was misconduct, there will be consequences.

QUESTION: Did the State Department know about these alleged allegations about him being a deserter?

MS. HARF: I think there have been – as I said yesterday, perhaps not as eloquently as I should have – there have been a range of reports about what happened to him and how he ended up in Taliban custody – there really have – a range of them since he went missing. You can read press reports going back several years to attest to that. So obviously, we were aware of some of that. But again, what we were focused on was getting him home. Determining how he went missing is for a later time.

QUESTION: And what evidence did you have that his health was in danger?

MS. HARF: I mean, we had a variety of evidence. Some of it you’ve seen publicly in terms of proof of life. I’m not going to go into details about all the information we had about him.

QUESTION: Does the State Department think – back to the Taliban video – that when he was walking to the bird he looked like he was in pretty good shape?

MS. HARF: I’m not going to make a medical assessment based on a video. This is a United States soldier who has been in captivity for five years. I can’t – none of us here can imagine what that would do to you or how you would come out of that on the other end, and that’s why I think we all owe him and his family, regardless of our feelings on this, a little bit of time so he can get in better health, he can reunite with his family, and then we’ll figure out what happened. But I think we owe it to him to do that.

QUESTION: Will the investigation be —

QUESTION: (Inaudible) question? You have consistently referred to Mr. Bergdahl as a prisoner of war.

MS. HARF: Mm-hmm.

QUESTION: Who decides who is a prisoner of war and who is not a prisoner of war?

MS. HARF: What do you mean, “who decides”? I mean, he was an American serviceman —

QUESTION: Well, the U.S. Government —

MS. HARF: — taken by the enemy in an armed conflict where we’re operating under an AUMF.

QUESTION: Right, I get that. But the people who are imprisoned at Guantanamo Bay were – although they could by some people be construed to be prisoners of war, and some of them were indeed taken on the battlefield in the course of a military conflict – they were deemed by the United States government not to be prisoners of war. They were very carefully defined to be enemy combatants, I think the historical record shows, so as to be able to strip them of the right —

MS. HARF: Well —

QUESTION: Let me finish – the rights that would have been —

QUESTION: Afforded —

QUESTION: — granted to – or afforded, exactly – prisoners of war. So you guys can call – you say that Sergeant Bergdahl was a prisoner of war, but maybe from the Taliban’s point of view he was not a prisoner of war.

QUESTION: He was just swept up on the battlefield of Afghanistan, just like the Taliban, right?

MS. HARF: Yeah, wait – can I make a few comments, though? So first of all, I can speak for what’s happened during this Administration, the decisions we’ve made about what we call people. Obviously, we inherited a situation with respect to Guantanamo Bay that we have tried through various mechanisms to rectify. The Supreme Court has held that Common Article 3 of the Geneva Conventions protects Taliban and other detainees captured in non-international armed conflicts like the one in Afghanistan. So they have – the Supreme Court has weighed in on this. Obviously, we inherited a situation where we were dealing with Guantanamo Bay that was operating a certain way – and again, we’ve tried to rectify it to the extent that we can.

Whether or not members of the Taliban meet particular prisoner of war criteria, including, I think, that it has to be between states – the prisoner of war term, I believe, in the Geneva Conventions refers to conflict between states. Obviously, the Taliban is not a state.

QUESTION: Right. So how then, if I may ask, is —

MS. HARF: In terms of the Geneva Convention.

QUESTION: — Mister Bergdahl a prisoner of war —

MS. HARF: Because he’s a member of a —

QUESTION: — because you’re an ally of the state of Afghanistan, correct me? So how is he a prisoner of war?

MS. HARF: So he is a member of the United States military —

QUESTION: You talked about conflict between states.

MS. HARF: Right, but he is a member of a state army being held during a time of war where we’re operating under an AUMF in American law.

QUESTION: That you —

MS. HARF: I’m happy to check with the lawyers if there’s more details —

QUESTION: No, no, I get it. It’s just —

MS. HARF: — and I’m not re-litigating why the Bush Administration called people a certain thing when they got to Guantanamo.

QUESTION: (Off-mike.)

QUESTION: No, no. But the point I’m trying to make is when you justify your – the President’s decision to secure his release in the manner that he did – I take no position on the merits of that —

MS. HARF: Yeah.

QUESTION: — by using certain terms like “prisoner of war” for your guy and not prisoner of war for the Taliban people, you’re using language in a way that tries to justify something, but it’s not clear to me at all whether the use of the language – and maybe it is – is actually justified.

MS. HARF: So can I – just speaking, I think, to your – I think your broader point: that we believe that prisoner swaps during a time of war – forgetting about the legal definitions under the Geneva Convention or international law – are – have a long historical precedent and are justified, and this was one of them.

I think the President has been clear when it comes to Guantanamo Bay that we inherited a situation we did not agree with; that we are bound in some respects by some of the legal rulings, by what Congress has tried to do. But the fundamental notion that we want to close the prison, that we want these – charge or transfer where we can, and that we have improved the situation there is something that is in line with, I think, what you’re getting at. I think. And I can’t defend what was done in the previous eight years when Guantanamo Bay was open, but the President has been very clear about the incredibly hurtful nature of Guantanamo Bay to the United States – how we’re seen overseas, how it in many cases has not been in line with our values, and that’s why he has committed to close it.

So I’m trying to get, I think – I mean, language is important, absolutely. And here we very much stand by the notion that this was prisoner swap during a time of war. But I think actions and how we’re treating these people and how we’re trying to rectify the situation is in some ways more important.

QUESTION: So are we now prepared to afford the remaining 160 or whatever number of detainees —

MS. HARF: Hundred and forty-nine.

QUESTION: — hundred and forty-nine detainees that remain at Guantanamo – are we now willing to afford them POW status?

MS. HARF: This in no way changes the system we are operating under at Guantanamo Bay today. This in no way – which has been the subject of many legal cases, congressional action – again, we inherited a situation; we’ve attempted to rectify it. Congress has done quite a bit, as has the court system, to put in place how Guantanamo Bay operates today, and this in no way changes that, period.

QUESTION: Marie, just a follow-up real quick —

MS. HARF: Uh-huh.

QUESTION: — about the Taliban prisoners at Guantanamo. Can you restate how you classified them? Were they part of a detainee group scheduled for release?

MS. HARF: No. As I said, there have been – just give me one second.

QUESTION: How many are (inaudible) —<

The Honourable Jason Kenney delivered a speech at Polytechnics Canada’s 2014 annual conference

DATE:  May 7, 2014

LOCATION:  Algonquin College – Ottawa Campus, Ottawa, Ontario

SUBJECT:  Minister of Employment and Social Development Jason Kenney delivers a speech recognizing the work at polytechnics to ensure graduates have the skills employers need at Polytechnics Canada’s 2014 annual conference “The Future We Want, the Difference We Make.”

Hon. Jason Kenney: I think the work that Polytechnics Canada and all of its member colleges represented by you here tonight is in many ways the most important work being done in the Canadian post-secondary education sector. And that’s really what I’m here to talk about tonight.

Algonquin College represents 159 college programs, with 21 apprenticeship programs and 61 online programs, to name just three from an impressive list of what’s offered at this college, typical of all the polytechnics across Canada.

Now let me just begin my remarks by situating them in the kind of context of Canada’s economy. Of course, up on Parliament Hill we have our partisan debates about our strengths and weaknesses, but fundamentally, I think we can all recognize that the Canadian economy is doing pretty well—in fact, significantly better than most other developed economies. The recession, the global downturn here was shorter and shallower than in virtually any other developed democracy, and the recovery has been stronger, with the creation of some 1.1 million net new jobs since the 2009 downturn— the overwhelming majority of them—about 90 percent of them—being full-time jobs, and 80 percent of them in high-wage industries.

We have one of the strongest fiscal positions in the developed world, with one of the lowest levels of debt, of public indebtedness at the federal level in the developed world. We’re going to have a balanced federal budget next year, and a number of provinces moving to balance—at relatively low tax levels for our history. In fact, the federal tax take as a share of our Gross Domestic Product is at its lowest level since the mid-1960s. And still that word has not got out very well around the world, and people still have this brand idea of Canada as a high-tax jurisdiction and a country that not too long ago was a bit of fiscal basket case.

Well, we have turned that around, and we now have the lowest taxes in the world on new business investment, at least amongst the major developed economies of the world.

Bloomberg just last week ranked Canada for I think the third straight year as the best country in the world in which to do business. The World Economic Forum says we have the strongest financial sector or the strongest banks. And the good news goes on and on. And these are things about which we should be grateful, but with all of those strengths come certain challenges.

But first, you know, the future’s looking even brighter—brighter because Canada, as you know, has always been an export-driven economy and we are diversifying our export markets in important ways. For far too long, of course, we have been over- dependent on the United States as virtually a captive market for our goods and services, but we are diversifying, having moved from 4 to 43 free trade agreements in the past 6 years, including trade agreements with the European Union, 28 member states representing 500 million consumers, largely in highly developed economies. And we will be the first jurisdiction in the world with simultaneous, basically tariff-free access to the market of 300 million people in the United States and the 500 million people in the European Union.

To that, we are adding, we hope, market free access to one of the most dynamic and the most innovative economies in Asia, that of South Korea, which will begin accelerated Canadian market access to these enormous and growing Asian economies.

So altogether, things are looking bright from a fiscal point of view. We’re doing relatively well in our domestic economy. Our export markets are opening up. And on top of all of that, we are on the cusp of what some people are calling a new industrial revolution in Canada’s economy that is a result of the hundreds of billions of dollars of capital investments that are coming on stream in extractive industries in a huge swath of northern Canada.

From the offshore oil and gas in Newfoundland to heavy minerals in Labrador to precious metals in northern Quebec, mining operations in northern Ontario’s Ring of Fire, to new hydro developments in Manitoba, potash and uranium in Saskatchewan and hydraulic fracturing in southern Saskatchewan, resulting in an energy boom there, to of course our bitumen reserves, oil, gas and other resources in Alberta, new mining developments in northern B.C. and all across the three northern territories opening up new horizons of opportunity, especially for our First Nations people, our Aboriginal people who happen to be proximate to so many of those huge new investments.

And by the way, each one of those developments, every one of those mines, every one of those projects of course is a public policy challenge. We have to make sure all of those things happen in a way that is environmentally sustainable and responsible. But if even a relatively small fraction of these prospective investments proceeds, we are talking about the creation of hundreds of thousands of high-paying, high-quality jobs primarily in skilled trades and vocations. And the challenge, as you know, is that our education systems have not been preparing young Canadians for those kinds of jobs in adequate numbers.

Now this is the big challenge that we will be facing. If there’s one reason that we are unable to fully grasp the potential offered by this “new industrial revolution,” it will be because we don’t have an adequate number of people with the right skills to actually fuel that prosperity.

Now let me be clear about this. This is a subject of some debate these days. As I’ve said as long as I’ve been in this position, Canada does not have a general labour shortage. The data doesn’t support it. If we did, we’d see wage rates rising more quickly than they are. But I think it’s undeniable if you actually look at the lived experience, the reality on the ground, if you listen to what employers and their representatives are saying from coast to coast to coast, that we are facing significant and acute skill shortages in certain regions and industries.

Let me give you some of these estimates. The construction sector says they will need 319,000 new workers in the next decade. The mining industry of Canada says they’ll need 145,000 more workers by 2020. The petroleum sector estimates they need 130,000 workers—additional workers—by 2020. And Skills Canada, which is, as you know, a great organization that we support, promoting the trades, tells us that we’re going to need a million skilled trade workers by the end of this decade. And the list goes on, whether it’s the Conference Board or the Chamber of Commerce, all of them estimating significant shortages, particularly in skilled trades.

So our challenge will be to fix the paradox of too many Canadians without jobs in an economy that has a growing number of jobs without Canadians.

And by the way, this isn’t a flash in the pan. It’s not based on anecdotal views. This is not just the data. This is also very obvious and intuitive when you understand that baby boomers are beginning to retire. We have a growing economy. The economy is growing most quickly in areas with sparse population through much of northern Canada where the extractive industries are located, and they tend to be in occupations which our education system has been under serving.

And by the way, you know, some of the demographers and economists tell us not to worry too much about the aging of our society and the retirement of the baby boomers—the demographic bulge—because they say people are working longer, and that’s true—for white collar workers. But for folks who are engaged in tough manual labour every single day, guess what? They’re not going to be working as welders and as carpenters and as heavy equipment operators into their 70s in work camps in northern Canada.

So let’s be realistic about this. These are occupations where we are going to see an entire generation of highly skilled Canadians—they have already begun—leaving these occupations. That pace is only going to accelerate. And regrettably, in part because of problems in our apprenticeship systems, we don’t have adequate opportunities for them to transmit their knowledge and learned experience to younger generations.

So for me, this is a matter of some urgency, and solving it requires movement on the part of the federal government, provincial governments, employers, industry associations, unions, educators, trainers in all different sectors.

Ces difficultés sont importantes mais nous comptons sur des personnes très compétentes pour trouver des solutions, particulièrement personnes comme ceux comme vous ici aux Polytechniques Canada.

And I want to thank Nobina, Ken and their whole team at Polytechnics here in Ottawa for playing an integral role in helping us address these challenges.

Vous vous proposez en vous appuyant sur des recherches et des données probantes des idées qui retiennent l’attention des décideurs au sein du gouvernement fédéral.

You challenge my officials to update their thinking on the changes underway in the Canadian education system, and I’m the first to admit that Ottawa doesn’t always have the answers. That’s why we appreciate the valuable input and the challenge function that Polytechnics Canada provides.

Let me give you just one very pressing example of what I’m talking about. The centrepiece of the most recent federal budget was called the Canada Apprenticeship Loan. The idea with the Canada Apprenticeship Loan is that apprentice students,  when they’re doing their formal block training, will be able to apply for and obtain interest-free financing through the Canada Student Loan Program. Students will be able to apply for up to $4,000 in interest-free loans. It’s estimated that at least 26,000 apprentices a year will benefit from this. It’s just one of the things that we have to do to break down this ridiculous idea that skills and vocational training and applied learning are somehow second-tier or second-class forms of education.

And guess what? The idea of the Canada Apprenticeship Loan came directly from Polytechnics Canada. In fact, I recall exactly the moment when. I had only been in my current post for a few weeks, and I heard about this whirlwind of ideas and energy, Nobina Robinson. Everyone told me I had to meet her. She had the solutions to the skills challenges that Canada was facing.

So we arrange a meeting for Nobina, and she came in, and I couldn’t get a word in edgewise for an entire hour, as you might imagine, which was just fine because she downloaded a brilliant analysis of the challenges that we’re facing in our post-secondary education system, and some fantastic solutions. And she said, “Why is it, Minister, that we give preferential loans, supported by the federal government, to students engaged in full-time academic studies at degree-granting universities, but we leave the apprentices out in the cold?”

And I looked at that, and I thought, you know, here we have a problem. We’ve got—thankfully—a growing number of young Canadians registering in apprenticeship programs. We’re now up to about 340,000. Well, that’s good news. The bad news is only half of them are going on to completion. We have an apprenticeship completion problem in this country. And I believe one of the reasons is because the opportunity cost for young people to leave their good-paying jobs as apprentices and go and do their formal block training is significantly high.

You know how it is. If you’re a young fellow in your early 20s in a welding apprenticeship program, and you’re working up in the oil sands in northern Alberta making 35 or 45 dollars an hour, well, first of all, you know how young people are. Their spend rate, their burn rate automatically goes to their amount of money—to consume every dollar that they’re generating, right? Young fellows in their 20s are not famous savers.

And so they kick up their spend rate, and they’ve got the lease on the new truck, and they’ve got the nice new apartment. And they’re spending every dollar that comes in. And the idea of suddenly going cold turkey for two months, so they can go down to SIAST or NAIT or BCIT and do their block training, suddenly is a very expensive and risky one. And so all the incentives are just to keep working and generating the income and to kick the apprenticeship can down the road.

Well, we have to soften the blow for them. We have to create the incentives for them to actually get to that journeyman Red Seal certification, so that they have that level of formal skills that they can transmit to others.

And a number of things need to be done in this area. First of all, we’ve brought in a policy that allows employers to pay those folks on their block training up to 95 percent of their regular salary level on top of employment insurance benefits, with no penalty. So the responsible employers can keep their apprentice employees whole during their block training. Point one.

Point two. We’ve now in this budget launched the Canada Apprenticeship Loan, which gives them a financing option to get through that period, as well to cover living expenses and other related expenses to reduce the opportunity cost.

And point three, in the budget, we’ve also launched a pilot project to support innovative ways of delivering the block training online and through remote learning, so that perhaps some of these people can stay in the remote work sites where they’re located and actually take their block training in smaller increments over weekends and evenings and through creative delivery of those programs. I know a number of you are doing that already.

Now this stuff isn’t terribly exciting. None of these ideas make it to the front page of the Globe and Mail, and I don’t think, Nathan, we’ve actually had a single question in the House of Commons on the Canada Apprenticeship Loans—probably a good thing— because I think there’s actually consensus around it.

By the way, political journalists—I’ll let you in on a secret, they’re actually fight promoters. So if there’s no fight on the issue, there’s nothing to report. But these are great ideas. And guess what? It was Polytechnics Canada, it was Nobina who came, and she said we’ve been trying to push this for years, but no one will listen. Well, someone finally did. And I’ll be honest, we encountered a certain resistance. I think the resistance was because before, you had to have 10 weeks of class in an accredited program in order to qualify for the Student Loan Program, and we didn’t want to water that down, we didn’t want to dilute it.

But you know, I think there was an unconscious bias behind that policy decision. And the unconscious bias was that apprenticeship learning isn’t really the equivalent to university education. And when I heard that argument offered, that’s what pushed me over the line. And I said, look, that’s exactly why we need to do this. We need to it not just to facilitate some financing options for young apprentices, so they complete their programs. We need to do it, just as importantly, in order to send a symbolic signal that the federal government regards apprenticeship learning in the trades as every bit as valuable as going to university in an academic program, and that’s what the loan says.

So thank you for the constructive role that you play.

Now another solution to this challenge of the future skills gap is to take a long and hard look more broadly at our secondary and post-secondary education systems.

Let me start by using Polytechnics Canada as an example of what I’m talking about. In case you haven’t figured it out yet, by the way, I’m a big fan of Polytechnics Canada and the work that your colleges do. And let me explain why I’m a fan.

Across Canada, you have 280,000 students enrolled in 11 institutions across 55 campuses. You offer a wide range of programs—a hundred stand-alone degrees, 24 joint degrees, 754 diplomas, 558 certificates, 200 graduate certificates and 225 apprenticeship programs.

What unites students across those different streams of learning is that they get good jobs. Some 90 percent of polytechnics students in Canada are employed after six months, and some of those coming out of the degree programs, it’s much higher. How many other educational institutions can boast numbers like that? Well, frankly, we don’t know, and that’s part of the problem, isn’t it? 

Interestingly, polytechnic schools are increasingly becoming a finishing school for general arts and science bachelor degree holders. Forty-six percent of your students have partially completed some kind of university or college training before enrolling at a polytechnic institution. Twelve percent of your students have actually completed a bachelor’s degree, and another 15 percent a college diploma or certificate before enrolling.

Students are flocking to your institutions. And by the way, I know you’re turning away far more than you can accommodate. They’re flocking to your institutions because of your small class sizes, your hands-on training on equipment used in industry, your teaching by industry-experienced faculty, and your integrated learning through placements, co-ops and internships—in other words, through applied learning. And of course, there’s also that 90 percent employment rate I mentioned before. As the jobs minister, I kind of like that.

The case outlined above demonstrates that the polytechnic model is hugely successful and the exact type of programming that governments should be supporting far more vigorously than they currently are.

That’s why it’s so frustrating to me when I hear that provincial government funding for polytechnic colleges isn’t keeping up with funding for other forms of post-secondary education. Between 2008 and 2013, the number of prospective students—people aged 20 to 34—in provinces with polytechnic institutions has increased by over 9 percent, all right? At the same time, federal government transfers to the provinces for post-secondary education through the Canada Social Transfer have increased by nearly five percent annually over the same period. So your prospective clientele’s grown by nine percent. The federal funding to the provinces has grown by five percent—sorry, we haven’t kept up with your population growth—but here’s the catch. Provincial funding to polytechnics through your operating budgets has only increased by 2.8 percent over the same period. And so there’s something fundamentally wrong with that. Provincial funding as a percentage of your operating budgets has actually decreased by an average of 2.9 percent.

So to summarize my point, employers from across Canada tell us that there is a current and growing demand for skilled workers in the very fields that your institutions are training young Canadians for. You’re producing a 90 percent employment rate—more than that in certain programs. And you’re clearly tremendously successful at knowing what jobs are in demand today, preparing graduates for those jobs. And yet your share of provincial support is not keeping up with the funds that the federal government is giving to provinces for post-secondary education. I want to know, where is our money going? And I think the federal government has a right to know that question.

It’s not our business to administer post-secondary education. We acknowledge – nous – évidemment, nous reconnaissons entièrement la juridiction constitutionnelle des provinces et territoires quant à l’éducation, y compris l’éducation postsecondaire.

Cela étant dit, en temps qu’une source des fonds importants pour l’éducation postsecondaire, d’après moi, le gouvernement fédéral a le droit au moins à poser les questions d’où vont les investissements des contribuables fédéraux? 

At the very least, while we respect provincial jurisdiction in the areas of education policy—as a major funder, I believe the Government of Canada has every right to ask why those dollars that we are increasing to provinces for post-secondary education are not finding their ways into the budgets and programs delivered by Canada’s polytechnic institutions.

Go ahead and applaud. I won’t turn you in to your provincial ministers, I promise.

I’m meeting with those provincial ministers, my Forum of Labour Market Ministers this summer, and make no mistake: I am putting this on the table. The next time the provinces ask me to spend more on post-secondary education or they ask us to increase their allotment for immigration or bring in more temporary foreign workers or what have you, I’m going to tell them that I expect to see money move to where results are in our education and training systems. That means moving money to polytechnics.

Now this is just one area of our secondary and post-secondary system that needs to be reviewed. We also need of course to do a better job of making a compelling case to young Canadians to consider a future in apprenticeship programs, in applied learning and in the skilled trades in particular.

For too long, we’ve settled for this kind of one-size-fits-all approach to youth employment, which has essentially been to tell young people to stay in school for as long as they can while in many ways frowning on vocational schools and apprenticeship training.

Provincial governments need to realize that the choices they made in the 1970s and 80s to downgrade vocational education were shortsighted. Forty years ago, most high schools offered vocational training. But for some reason, provincial education ministries and school boards decided to push vocational and skills training to the margins. In the 1990s, York University found that the number of technology courses taken by secondary school students in Ontario dropped from 480,000 in 1973 to 257,000 in 1996. Now it would be very interesting to see more recent data because all of the indications are that number has plummeted even further.

And that’s made worse still by the burden of debt incurred from staying in school longer, doing as they were told to do and then struggling afterward to find a good-paying job.

Let’s bear in mind, however, that some countries have fared significantly better than Canada—such as European countries—when it comes to connecting education and training to jobs in the labour market.

And that’s precisely why in March of this year, I led a study mission, which included Polytechnics Canada. Ken was there and Larry from SIAST attended together with all of the major Canadian business organizations, some of our largest unions and representatives from five of our provincial governments. And in Germany, we saw their phenomenal vocational training system. Now you all know about it; it’s almost mythic in its international reputation. And let me begin with the usual caveat. Of course we cannot replicate the German system, rooted as it is in hundreds of years of the guild system and their particular political legal system. We can’t replicate it. But what we can do is learn from it.

And here’s what I learned. I learned that nearly two-thirds of young Germans at the average age of 16 go into paid apprenticeship programs, typically with three and a half days on the work site, where an employer is paying them a good stipend of a thousand euros a month and then a day and a half in a vocational college, where they’re learning the applied theory of the skills they’re developing on the work site.

And I learned that on average those German apprenticeship programs are completed in three years. They’re graduating with their certificate, on average, at the age of 19, and 95 percent of them are going into employment in the field for which they were trained without student debt, with practical work experience, with a certificate that has equal value in every corner of their country, of their federation, and a certificate which is considered by everyone as having the same educational, social and economic value as a university degree. And that was perhaps the core learning that we had.

You know, that wasn’t just the advocates of the trades saying this. It wasn’t just the employers or the unions saying that. It was the academics themselves. I must admit I was astonished to hear one of the leading scholars of the German education system, a fellow with two PhDs, express how concerned he was to see a growing percentage of young Germans going into academic university programs as opposed to apprenticeship trades programs. I’d love to meet an academic in Canada who would share the similar sentiment.

And maybe this is why the German unemployment rate for youth is about half of our unemployment rate for young Canadians.

Of course a key part of the German system is the sense of responsibility amongst employers to contribute. German employers contribute the equivalent of 49 billion Canadian dollars per year in apprenticeship programs alone. And that contrasts rather unfavourably to private sector investments in skills development here in Canada.

You know the numbers. We have the highest level of public sector state-supported investments in skills development in the OECD. But we are the bottom of the developed world when it comes to how much companies, the private sector, put into skills development. So we need to find ways to prime the pump to encourage our employers to take up the challenge.

You know I was recently at the B.C. Business Summit. All the major employers in British Columbia were there. And every time I meet with these guys they say to me they need temporary foreign workers, they need more immigration numbers, they need to address the labour challenges in those ways. And I say to them, listen, I don’t want to ever hear you coming talking to me again about labour shortages and skills gaps unless and until we see demonstrable increases in private sector investments in skills training and preparing young people for the jobs of the future.

Now to give the employers their due, many employers are star performers, and many of them do participate. Many of them sponsor programs in your colleges and help you acquire new capital equipment for training—and I think we’re beginning to turn the corner on this. I think employers understand they have to put more skin in the game.

This, by the way, was really the idea, the motive idea behind our Canada Job Grant, an idea that became unnecessarily controversial, but we’ve since reached agreement with all provinces and territories for them to deliver this Job Grant. The idea was actually radically simple in a way. It was picking up the Germanic idea of employer-led training and investment in training initiatives. This is a particular challenge for small and medium-sized businesses.

When we ask SMEs in Canada why they don’t put more money into training, why they don’t hire more apprentices, they tell us it’s because they are terrified of poaching. For an SME to spend thousands of dollars putting a young person through a diploma program or tens of thousands through an apprenticeship program as an indentured apprentice, only to find that person, as soon as they’re certified, poached by a major employer with deeper pockets and a bigger payroll, that’s a very serious point of exposure for small businesses.

The idea behind the Job Grant is simply to reduce that exposure for them, so that they can identify young people or a group of people for a specific training program, at the end of which they have a guaranteed job, but we’ll come in and support roughly two-thirds or as much as three-quarters of the training costs. They have to put some skin in the game. They have to be involved in recruiting the individual. They have to guarantee them a job and hopefully mentor them through the process. We hope this will begin to replicate some of the magic in the German training system.

You know, it’s not just in Germany. We also visited the United Kingdom, whose system, for various obvious historical reasons is closer to our own. But here’s the interesting thing. The UK went through very much the same kind of single-minded focus on academic post-secondary education in the 1980s. And they’ve begun to try to reverse the momentum back towards applied learning. In the 1980s their polytechnics all graduated to degree-granting universities essentially. And now they’re trying to build up the college sector doing vocational training, doing apprenticeship programs with teenagers, so that, again, they’re coming out before they’re 20 with valuable skills and typically very good employment prospects.

And did you know that in the United Kingdom someone who does an apprenticeship program makes $275,000 more in Canadian dollars over their lifetime than those that graduate with a university degree.

By the way, we need comparable data here in Canada. We simply don’t have it. And some of the data being used in this debate is, shall we say, more than a little misleading. To compare the outcomes of all university grads in Canada, many of whom are boomers in their peak earning years, many of who are in the highest paying professions, to compare that aggregate average with everyone else is an irrelevant comparison.

But let’s begin comparing the employment earnings of, I don’t know, sociology majors to welders. Let’s begin comparing the outcomes for bachelors in communications with power engineers. If we actually begin doing more disaggregated real world comparisons, then we have some data that’s useful to share with young people.

Now don’t get me wrong. I have to make this disclaimer. We do not—I do not for a moment seek to denigrate the enormous value of academic post-secondary education that’s offered by our universities or the humanities or the liberal arts, all of which are enormously valuable and most of which programs lead to great outcomes. But what I am suggesting is that what we must begin doing in Canada is to replicate what in Europe they call the parity of esteem between different forms of education, training and employment. We must stop sending cultural cues to young people through their high school counsellors, their parents, their governments that they are somehow failing or not realizing their potential if they pursue a technical vocation or trade. We need to clearly and at every opportunity indicate that the choice of going to a Canadian polytechnic and working in a technical vocation is every bit as valuable as going to university and getting an academic degree.

There’s a whole lot more we have to do, but I’ve spoken long enough. Let me just perhaps summarize it by saying that the Government of Canada is trying to play its role to create the right incentives, to send the right signals. For example, we created the Apprenticeship Incentive Grant and the Apprenticeship Completion Grant, which, together, represent $4,000 available to students who go through their apprenticeship programs. We’ve created the Apprenticeship Hiring Grant for employers to incentivize them to do the same. We created the Tools Tax Credit.

And by the way, we’ve reformed the immigration system to try to support skilled people in these kinds of vocations. You know, since the early 1970s, Canada basically closed its immigration system to blue-collar immigrants, people who work in the trades. We opened a new door in the Skilled Trade stream of our immigration system and through our Provincial Nominee programs in the last few years. These are highly skilled people who can come in as permanent residents and be the journeymen to take on apprentices. We need to reduce journeymen-apprenticeship ratios in those provinces where they are unrealistically high to allow smaller contractors to take aboard apprentices.

We need harmonization in the apprenticeship programs across the country. The New West Partnership in Saskatchewan, Alberta and B.C. is doing this. The Atlantic provinces are, with our support. It would be nice to see the two central Canadian provinces get with the program.

We of course need to continue knocking down the remaining barriers to interprovincial labour mobility and to mutual recognition of trades and professions. And we need to do more to recognize the skills of foreign-trained professionals and tradespeople who are too often under-employed in our economy.

And of course we must all continue to focus particularly on those groups in our population like young Aboriginal Canadians who are massively under-represented in the workforce.

So these are big challenges, but the good news is I believe we’ve begun to see a significant change in the debate and the allocation of resources. The recent announcement by the Government of British Columbia that they’ve begun reengineering their secondary and post-secondary education systems, that they want to track labour market outcomes from all of the PSE streams and they want dollars to follow results is extremely good news. This is a model that can and must be replicated right across the country.

So with the innovative ideas and programs that you are delivering, with a federal government that is in full support of this new skills agenda, with provincial governments coming onboard, with employers understanding the urgency of these issues and increasing their investments, particularly in engaging Aboriginal Canadians in the workforce, I believe we can see a bright new horizon in a reform in our post-secondary education system that ultimately will be all about helping us to help young people to realize their potential and to contribute to our wonderful country’s prosperity.

Thanks very much for your time and for all the good work that you do.


Innovation vs. Austerity: how can Spain enhance its knowledge economy in austere times?

European Commission

[Check Against Delivery]


European Commissioner for Research, Innovation and Science

Innovation vs. Austerity: how can Spain enhance its knowledge economy in austere times?

The Economist’s Spain Summit Closing session

Madrid, 3 June 2014

Ladies and gentlemen,

The subject of this Summit, “Accelerating the return to growth”, could not be more relevant for the situation in Europe today.

After a long period of economic downturn, the signs of recovery in Europe are becoming evident. This is true in Spain, where the European Commission’s Spring forecast put growth in 2014 at 1.1 percent, rising to 2.1 percent in 2015.

However, the recovery remains fragile and uneven, and it is now urgent for the European Union to really focus on the measures that can secure growth and jobs.

I am convinced that research and innovation must be at the heart of a lasting recovery, so that Europe takes its place as the knowledge economy.

I’m certainly not alone in that conviction. Last October the EU Heads of State and Government declared clearly that ‘Investment in research and innovation fuels productivity and growth and is key for job creation’.

And the point of consensus following the European elections is that Europe must focus even more on jobs and growth.

Indeed, the evidence shows that the Member States that continued to invest in research and innovation have fared better in the current crisis.

There is also a wide agreement that investing in research and innovation is the entry ticket to the knowledge economy.

So it is worrying to see that many Member States have cut research and innovation spending in the last few years. In Spain, the public budget for research was cut by 25% in real terms between 2008 and 2012. And Spain is by no means the only such Member State.

At first glance, and considering the severe pressures on budgets, such cuts are perhaps understandable. However, public research investment helps create the knowledge base and talent that innovative companies need, and it also leverages business investment in research and innovation, crucial elements in fulfilling the aims of Europe 2020.

The countries that are cutting investments for a prolonged period risk losing the highly skilled talent that is essential to remain competitive and for generating future jobs and growth. It will be very difficult to recover from these lost investments.

So unless we reverse this trend, I am afraid that there will be parts of Europe that, in the long run, will not be able to compete in the knowledge economy. The ‘innovation divide’ risks becoming an entrenched economic divide.

It is against this backdrop that the European Commission is preparing new proposals that focus on research and innovation as the sources of renewed growth.

I will be presenting these with Vice President Olli Rehn next week.

One of the thorniest issues that we will address is how we solve the conundrum of investing more in research and innovation in times of fiscal consolidation, when public budgets are under greatest pressure.

The very clear message from the Commission is to prioritise and to reform.

Some countries have been here before. Finland turned its economy around in the 1990s by focusing on innovation and making the necessary investment, despite huge budget pressures.

At the same time, Finland reformed its research and innovation policies and has been continuously improving them ever since.

And more recently, we are seeing that continuing to invest in the sources of jobs and growth is paying off in several Member States and in the transformation of economies like South Korea and China.

And this is also what the EU did last year when it agreed its new seven-year budget.

While the overall budget envelope was reduced, there is a decisive shift towards research and innovation – with Horizon 2020 seeing a 30% real terms increase in finance. And hand in hand with this increase, Horizon 2020 has been radically reformed to be simpler and achieve greater impact.

Reform will bring in more business investment in innovation. Many businesses look globally when they invest in research and innovation. So Europe and Member States like Spain must be able to put forward an attractive proposition.

The Single Market is, I believe, a huge motivation to invest in Europe. But we need to make sure the Single Market works, especially in high tech areas such as the digital economy and biopharmaceuticals.

Progress at European level, for example on the European patent, remains essential, so we will continue to implement the innovation-friendly measures championed by the Innovation Union initiative.

Alongside these framework conditions, there is the potential for smart investments by the public sector to leverage private investment.

The European Union has just agreed six partnerships with industry worth some 17 billion euro in pharmaceuticals, ICT, transport and the bio economy. More than half of this investment comes from the private sector. This kind of public private partnership can, and should be, supported by individual countries.

Indeed, public and private investments in research and innovation are closely linked.

Improvements in the quality and efficiency of public spending can help create a ‘virtuous circle’, by leveraging higher investment levels from the private sector and generating increasing economic returns.

Our proposals next week will support governments to make the necessary reforms.

No government can fund world class science and innovation in all areas, and so each country must take tough decisions to prioritise their research and innovation budget in the areas where it will produce the greatest impacts.

The aim here must be smart specialisation – playing to a region or Member State’s particular strengths and talents and focusing resources where they have the greatest impact rather than spreading investment too widely and too thinly.

We’re encouraging this approach under the EU’s new Cohesion Policy. From now on, every Member State and region must have a smart specialisation strategy in place as a condition to receiving funding for research and innovation from the European Structural and Investment Funds.

I am also a firm believer that public funding for research and innovation should be allocated on a competitive basis to the best proposals. This objective approach is the foundation of excellent science, but it is not yet common practice in all Member States.

There is also much to be done to improve the performance of universities and public research organisations.

Universities need to be able to enter partnerships with business and other actors.

The performance of universities should be assessed independently. And positions in universities should be advertised openly with recruitment based on merit.

These reforms are all important ways to ensure that public money is being well spent. They will also enable the free movement of researchers and ideas across Europe creating a European Research Area.

We also need to reform how we finance research and innovation. Beyond grant funding, we have seen that many countries are using tax credits and financial instruments to support business research and innovation.

And at European level we have also reformed how we support research and innovation, with the new Horizon 2020 programme which has a budget of nearly 80 billion euro.

The programme aims to get bigger impacts for our investments in scientific excellence, industrial leadership and societal challenges.

Horizon 2020 also represents economic reform, designed to generate growth and jobs. We have a programme that has cut red-tape, where excellence is the benchmark and where we champion both top quality fundamental research, and its application in innovation.

The programme will promote even greater industry involvement, in particular for SMEs and new entrants.

Indeed, while research and innovation for SMEs are promoted across the whole programme, Horizon 2020 also introduces a new instrument designed to meet their specific needs.

There are also new financing options in the form of risk-sharing (through guarantees) or risk finance (through loans and equity) to support innovative companies.

I urge Spanish companies, including SMEs, to seek out the new opportunities provided by Horizon 2020. This is not just about support to finance innovative projects, but also to enable companies to access the best knowledge and expertise from across Europe.

But Horizon 2020 can only complement investment and reform at national level.

Spain is not facing its challenges alone – many Member States share similar problems. I know that Minister de Guindos, who is responsible for research in the Spanish government, is ambitious to reform, and the European Commission is keen to help.

For example, the Commission is financing a Peer Review of Spain’s research and innovation policy by experts from seven other European countries.

The European peer review will provide suggestions to Spain on how to reinforce the contribution of research and innovation to your economy and society.

Minister de Guindos has committed to closely examining the suggestions and take them on board.

Spain’s determination to reform has already resulted in the very welcome National Reform Programme, in particular the newly-adopted Strategy and Implementing Plan for Research and Innovation and the announcement of a National Research Agency.

These are the right steps, but what more could Spain do?

Yesterday, as part of the European Semester process the European Commission presented the results of its assessment for 2014, together with proposals for Country Specific Recommendations to be endorsed by the European Council.

Recommendations are made for each Member State, and the proposed recommendations for Spain include the financing of the new national strategy for science, technology and innovation as well as making operational the new State Research Agency.

This means that when Spain reviews its spending priorities within its fiscal consolidation strategy, it should identify the sources of funding for the new National Strategy and Plan for Science, Technology and Innovation.

The Commission also considers that Spain needs to increase the quality of research outputs. This means that the new State Research Agency should follow best practice in the allocation of funding to universities and other research-performing organisations based on their performance. Greater use should be made of competitive calls for proposals which use international standards of peer review. In the long run such measures will encourage excellence and deliver better value for money.

Finally, the Commission’s assessment is that Spain needs to foster public-private cooperation and facilitate the commercial development of research outputs. So there should be incentives for researchers, universities and public research organisations to cooperate with industry.

Ladies and gentlemen,

If I were to distill what I have been discussing down to one message, it would be this:

Combining investment and reform of research and innovation must be Europe’s roadmap to growth and prosperity.

I don’t underestimate the task. I know from my own experience with Horizon 2020 just how difficult this is, and I know what a big challenge it is for Spain.

This means a relentless focus on jobs and growth. It will mean Europe as a whole will need to shift resources towards research and innovation and other growth-enhancing measures.

This is already happening at the EU level, and the Commission is encouraging Member States to do likewise within their fiscal consolidation strategies.

At the same time we need to reform our research and innovation systems and create the framework conditions that will attract innovators, entrepreneurs and business investments.

It’s a challenge that I know you will meet and it is absolutely essential to do so – so that the economy that will emerge from the crisis will be very different from before.

We are with you every step of the way.

Thank you.