DEFENSE SECRETARY CARTER'S COMMENTS ON DEFENSE RELATIONSHIP WITH VIETNAM

FROM:  U.S. DEFENSE DEPARTMENT

Right:  Defense Secretary Ash Carter, left, and Vietnamese Defense Minister Gen. Phung Quang Thanh hold a news conference in Hanoi, Vietnam, June 1, 2015. Carter is on a 10-day trip to meet with Asia-Pacific partner nations and affirm the U.S. commitment to the region. DoD photo by Glenn Fawcett.

Carter: U.S., Vietnam Committed to Defense Relationship
By Cheryl Pellerin
DoD News, Defense Media Activity

WASHINGTON, June 2, 2015 – The United States and Vietnam are committed to deepening their defense relationship, Defense Secretary Ash Carter said yesterday in the Vietnamese capital of Hanoi during a news conference with Defense Minister Gen. Phung Quang Thanh.

Carter also met with Vietnamese President Truong Tan Sang and General Secretary Nguyen Phu Trong as part of his 10-day trip to meet with Asia-Pacific partner nations and affirm the U.S. commitment to the region.

The two nations have come a long way over the past 20 years, Carter said.

The Next 20 Years

“As the general and I reaffirmed in our meeting today, we're both committed to deepening our defense relationship and laying the groundwork for the next 20 years of our partnership,” he said, adding that a joint vision statement signed yesterday will help the nations do just that.

“Following last year's decision by the United States to partially lift the ban of arms sales to Vietnam, our countries are now committed for the first time to operate together, step up our defense trade and work toward co-production,” Carter said.

This action, and Carter’s stop in Haiphong this week, where he was the first U.S. defense secretary to visit a Vietnamese military base and tour a Vietnamese coast guard vessel, underscores the “continued positive trajectory of the U.S.-Vietnam defense relationship,” he said, “especially in maritime security.”

Earlier this year in Da Nang, the U.S. and Vietnamese navies practiced using the code for unplanned encounters at sea, Carter said.

Peacekeeping Training

The United States will provide $18 million to the Vietnamese coast guard to purchase American Metal Shark patrol vessels, the secretary added, and the U.S. is helping to stand up a new peacekeeping training center for the Vietnamese military so they can participate in peacekeeping operations around the world.

“I'm pleased to announce today that the Department of Defense will assign a peacekeeping expert to our embassy here in Hanoi to work with the Vietnamese Defense Ministry to help prepare for their inaugural deployment to U.N. peacekeeping operations,” Carter said.

The secretary also returned two war artifacts to the Vietnamese people: a diary and a belt that belonged to a Vietnamese soldier. He said the U.S. military hopes to see the artifacts returned to their rightful owner or his family.

“With this exchange, we continue to help heal the wounds of our past,” the secretary said.

Commitment to Vietnam

In a statement summarizing Carter’s other activities yesterday, Pentagon officials said he reaffirmed the U.S. commitment to Vietnam and the Asia-Pacific region, reiterating U.S. support for a regional architecture that allows all Asia-Pacific countries to rise and prosper.

In his meetings, Carter discussed progress on legacy-of-war issues, support for Vietnamese peacekeeping training and operations, and cooperation on search-and-rescue, humanitarian assistance and disaster relief.

The secretary and his counterparts expressed a desire to leverage the joint vision statement to open the door to greater military-to-military cooperation that would allow the United States and Vietnam to more effectively work together to promote regional and global security, the statement said.

Maritime Security

Carter also discussed maritime security issues and the South China Sea. He pledged continued U.S. support to build Vietnamese maritime security capacity and underscored U.S. commitment to a peaceful resolution to disputed claims there made in accordance with international law.

“With this visit,” Carter said during the news conference, “we continue to lay the foundation for a bright future. With our work together, we continue to strengthen the region's security architecture so all our countries and others all around the region can continue to rise and prosper.”

STATE DEPARTMENT OFFICIAL'S REMARKS TO AIA ANNUAL MEETING

FROM:  THE STATE DEPARTMENT
Remarks to the AIA Annual Spring Board of Governors Meeting
Remarks
Puneet Talwar
Assistant Secretary, Bureau of Political-Military Affairs
Williamsburg, VA
May 21, 2015

Good morning, everyone. It’s a privilege to be here and let me thank David Joyce and Marilyn Hewson for inviting me here today.

As all of you know, at the State Department – in the Political-Military Affairs Bureau and the Economic and Business Affairs Bureau – we have re-energized our outreach to industry, and as part of that push we are glad to have such a strong presence here today.

It’s also a real pleasure to be here with my colleagues, Admiral Rixey and Assistant Secretary Jadotte – we work closely together on defense trade and so many other issues as well.

In the face of multiple crises around the world, today I’d like to speak about how America is leading in the context of today’s security environment, and how government and industry can work together – particularly in the arena of defense trade advocacy.

As President Obama has said, the question we face given the array of threats and opportunities across the globe, “is not whether America leads in the world, but how.”

There are two fundamental facts in today’s geostrategic environment that, I think, drive our leadership today.

The first is that the world’s greatest challenges do not affect any one nation alone. Terrorism; climate change; public health; territorial aggression – these are issues that affect many, if not all countries.

And the second truth is that no single nation can solve these problems alone. Of course, the United States has a unique leadership position in the world, and people look to us to step up. But we also have to recognize that even if we did everything perfectly on terrorism; even if we reduced our greenhouse gas emissions to zero… it wouldn’t be enough.

That’s why President Obama has put so much emphasis on strengthening our alliances and partnerships around the globe. Because we need our partners to step up so we can solve these problems together, in a durable and lasting way.

Defense trade is an important tool for us to be able to do that… whether it’s building the capabilities of the Israeli Defense Forces or the Iraqi Security Forces; whether it’s empowering our partners in South America or Southeast Asia.

That’s why our work together – between government and industry – is so critical. The fact is, we benefit from the American brand that you help build overseas. American companies create the most innovative, most effective solutions to meet our partners’ needs. And you have all made American products the gold standard in the defense industry. As Secretary Kerry said this week at Boeing, “the world wants what America makes.” We in government would be foolish if we did not use that to our advantage as we press forward on our national security interests.

And likewise, you in industry benefit from having U.S. leadership that’s trusted and strong, clear and coherent. The truth is that we each have a stake in each other’s success.

So when we decide that security cooperation with a foreign partner will further our national security, it’s deeply in our interest to work in an organized, collaborative, and proactive way to advocate for American interests and yes, American industry.

Now, many of you know that there are serious challenges in today’s defense trade market. It’s a competitive marketplace with other technology. The defense budget is tight here at home. Other governments can be more aggressive and often have fewer restrictions on what they are willing to sell and to whom.

We also realize that our licensing and regulatory system is imperfect… that sometimes the waits are too long or the process too opaque. And that’s exactly why we are implementing Export Control Reform – to unshackle ourselves from Cold War regulations and adapt to the 21st century… to focus our efforts on a narrower set of items that really matter… and to provide greater clarity and transparency to you in industry.

But Export Control Reform is not a panacea. Which is why we’re also refining other tools at our disposal.
Today, I’d like to discuss three objectives we have outlined in this area – and three specific actions we are taking to improve our defense trade advocacy.

First, when we in government work together, we are much more effective and powerful. It’s true that there are many players in the security cooperation enterprise and we do a lot to coordinate. I could throw so many acronyms and names at you: the Arms Transfer Technology Steering Group; the Security Cooperation Enterprise Group; the Senior Warfighter Integration Group’s work to expedite procurement.

But there are instances – specific sales – that require a tailored, unified effort to advocacy. That’s why we are building a single group, the Defense Advocacy Working Group, to identify areas that require heightened communication and an extra advocacy effort. At our different agencies, we share the same goals, but we don’t always synchronize our actions as well as we should. One central list and one central advocacy working group will lock in coordination from start to finish.

I’ll give you an example. Over the past year, we’ve piloted this process for our advocacy with Poland, which as many of you know is engaged in a historic $45 billion defense modernization program. Across every agency, we supported and advocated for U.S. solutions to Poland’s missile defense needs. Deputy Assistant Secretary Greg Kausner and Admiral Rixey travelled to Warsaw. You may have seen in the press that the Defense Department put PATRIOTs on display at a strategic time. And we had senior-level engagement to help move the ball forward. And as a result, the successful sale means supporting American jobs at home, deepening interoperability, and strengthening the security of Poland, a stalwart NATO ally.

This approach is proven – and we are now working to build on the success we saw with Poland elsewhere around the world.

Second, we in government need to project power in a more coordinated way at trade shows. Running into each other for the first time at the pavilions just doesn’t cut it. We need to do a better job coordinating our meetings, delivering consistent messages, and identifying areas we want to target. Some of you have likely seen progress already, as we are getting more in sync with each other. We want to build on this progress and are establishing an interagency working group to ensure that this coordination becomes institutionalized. Admiral Rixey’s deputy, Jenn Zakriski and I will be going to the Paris Air Show next month, and we’re looking forward to arriving ready with a common strategy for targeted outreach and advocacy.

Third, we need to be more transparent and responsive to industry. As our partners in the private sector, you should be able to ask us any time about our objectives. And you shouldn’t have to go agency to agency to agency to get answers.

That’s why, starting in July, we are launching a senior-level, quarterly industry outreach forum to have a two-way conversation with you. This quarterly forum will allow us to get input from you, assess upcoming sales, and build an advocacy strategy rooted in unity.

I know these three changes may not seem earth-shattering. But as leaders of large companies, you know that sometimes different arms of your organizations don’t talk to each other as well as they should. You’ve probably spent a lot of time on breaking down stovepipes, and you know it can have a huge impact. When we have all the oars in the water, rowing at the same time, we improve the outcome for all of us.

Yes, these are targeted actions, but we think their impact can be quite significant. Coordinating earlier and more often. Projecting our power, together, at trade shows. And continuing to deepen our engagements with industry.

Again, we have to do these things because it’s in our interest. Because the demands for our leadership are growing. Because we are more engaged in more places than ever before. You can see it in the headlines – whether it’s in the GCC or talks with Iran – but you can also see it in the trendlines that we’re so focused on, in the Asia-Pacific, where 60 percent of the world’s population is… where half of all GDP growth outside the U.S. is expected to come from in the next four years… where over half the world’s maritime commerce flows. And it’s security that underpins the economic growth – and the tremendous potential – that we are seeing in that region.

I could go on, but I’ll turn it over to Admiral Rixey and am happy to take any questions in the Q&A.

U.S. DEFENSE OFFICIAL TALKS DEFENSE-TRADE

Photo F-15.  Credit:  U.S. Air Force
FROM: U.S. DEPARTMENT OF STATE
Remarks to Defense Trade Advisory GroupRemarks
Andrew J. Shapiro
Assistant Secretary, Bureau of Political-Military Affairs
Washington, DC
July 26, 2012
Thank you all for being here today and it is my great pleasure to welcome the new Defense Trade Advisory Group.

We have many new faces, but I am also glad to see so many familiar faces. We are thrilled to have Sam Sevier [Sa-veer] back as DTAG Chair. Sam has done an outstanding job during what was a very busy two years. We are also excited to have Bill Wade as Vice Chair, as well as Kim DePew and Terry Otis serving as DTAG leadership. Overall, we have 28 returning members and 16 new members. Additionally, we are also excited to have so many DTAG members coming from outside the Beltway and bringing that perspective to deliberations.

These are certainly exciting times to come on board. This Administration has made tremendous progress in advancing export control reform and expanding U.S. defense trade with our allies and partners. As DTAG members, you provide an invaluable service to the Political Military Affairs bureau and the State Department. As we seek to reform our export control system, expand our defense trade abroad, and protect our most sensitive systems and technologies, your knowledge, experience and insight will be critical to guiding us through these eventful times.

Just in this past year, there have been a number of significant events with implications for the defense trade. The Arab Awakening in the Middle East has brought sweeping change to the region. Countries like Egypt, Libya, and Tunisia have undergone dramatic transitions. The recent events in Syria promises more dramatic change, as the Syrian people rise up against the brutal rule of the Assad regime. Each of these developments forces us assess the nature of our relationships with these countries and the region, and to take a look at our policies and practices. In addition, to these events in the Middle East, the Administration’s renewed focus on Asia will have significant defense trade implications. As we seek to reinvigorate existing alliances and develop new partnerships in Asia, our defense trade will be an important aspect of our diplomatic engagement. I have already spent more time on Asia than I anticipated coming into this job and I expect this to become the norm going forward.

While we navigate through these changing times, we look to you for advice and guidance. Defense trade is a critical component of our foreign policy and I encourage you to take advantage of these DTAG sessions to make your voices heard.

Today, I want to talk to you briefly about our efforts to expand the defense trade. As many of you know, this Administration has made it a top priority to promote U.S. business abroad. We view the American defense industry as an integral part of our efforts to advance U.S. national security and foreign policy. This is because security cooperation is fundamentally a foreign policy act. It is therefore the Secretary of State that is given the authority to oversee and authorize all arms sales in order to ensure they advance U.S. foreign policy. As a result, we only allow a sale after we carefully examine issues like human rights, regional security and nonproliferation concerns and determine a sale is in the best foreign policy and national security interests of the United States.

The arms transfer process sometimes causes consternation among our international partners. Some may gripe about onerous rules and procedures, intrusive monitoring, and rigorous investigations of potential violations. And at times it makes countries perhaps reluctant to partner with the United States. However, the safeguards we have in place are critical to U.S. foreign policy.

What is remarkable though, is that despite our high bar for approving transfers and our aggressive monitoring, more and more countries want to partner with the United States.

At the State Department – when we deem that cooperating with an ally or partner will advance our national security – we advocate tirelessly on U.S. companies behalf. And, as I like to say, I have the frequent flier miles to prove it.

It is no longer just our Ambassadors who promote U.S. security cooperation abroad. Senior State Department officials regularly advocate on behalf of U.S. bidders on foreign government and foreign military procurements. We do so when we meet with officials on our travels abroad, on the margins of international conferences, and in regular diplomatic correspondence to foreign government officials.

These efforts are having an impact. Despite the global economic strain, demand for U.S. defense products and services is stronger than ever.

We recently released the 655 Report – an annual report of defense articles and services that were authorized for export. This report focuses on Direct Commercial Sales and it showed that there was a more than $10 billion increase in FY11 in items authorized for transfer. In 2011 the Directorate for Defense Trade Controls processed more than 83,000 licenses. The most ever.

I can also confirm that this is a record-breaking year for Foreign Military Sales. We have surpassed $50 billion in sales in FY12. This represents at least a $20 billion increase over FY11 and we still have a chunk of the fiscal year left. To put this in context, FY11 was a record setting year at just over $30 billion. This fiscal year will be at least 70 percent greater than FY11. These sales support tens of thousands of American jobs, which is welcome news in this economy.

Let me briefly outline why I think we are seeing such strong interest in U.S. systems.

First, it’s because countries want to partner with the United States of America. The defense industry should understand – when it comes to sales abroad, it does better when America’s image abroad is strong and when countries want to partner with the United States. This Administration has done a tremendous amount to rebuild America’s image and that is demonstrated in record FMS and DCS sales.

We have reached out to new partners and emerging markets where we see the defense trade growing. This spring I was in India for the first Political-Military talks in six years. Cumulative defense sales have grown from virtually zero to more than $8 billion since 2008. One of the major goals we had during these talks was to make progress in advancing the defense trade. We sought to better familiarize the Indian government with our system and to address any concerns they may have. We think the U.S.-India defense and trade relationship would benefit from linking defense sales with broader strategic goals. That’s why we specifically articulated the technical and political advantages that FMS offers.

We have also actively engaged Brazil. Brazil is seeking to modernize and expand its military capabilities and we are seeking to support these efforts. Last year, I travelled to Brasilia to restart Political-Military talks and this past February a Brazilian delegation travelled to Washington, as we hope to make this an annual dialogue.

And in February, I travelled to the Philippines, Indonesia, Malaysia, and Singapore; and in June to Thailand, Vietnam, and Brunei. Many of these partners are seeking to modernize their defense sectors andwe are hopeful that our defense trade with these partners will continue to grow in the years ahead.

For a country to be willing to cooperate in the area of national defense – perhaps the most sensitive area for any nation – they have to be sure about the nature of the relationship with the United States. When a country buys an advanced U.S. defense system through our FMS, DCS, or Foreign Military Financing programs, they aren’t simply buying a product, they are also seeking a partnership with the United States. These programs both reinforce our diplomatic relations and establish a long term security relationship. The complex and technical nature of advanced defense systems frequently requires constant collaboration and interaction between countries over the life of that system – decades in many cases. This cooperation therefore helps build bilateral ties and creates strong incentives for recipient countries to maintain good relations with the United States.

For many countries procurement decisions aren’t simply based on the specifications of the given system. Our advocacy helps demonstrate that the U.S. government believes these sales are critical to our diplomatic relationships. The fact that more countries want to deepen their defense trade partnership with the United States is a sign that our broader diplomatic efforts are having an impact.

Second, countries want to buy the best. And to get the best they rightly turn to U.S. defense systems. These systems are "made in America" and the growth in defense sales abroad demonstrates the capabilities of American manufacturing and of American workers. This administration has worked hard to support the U.S. defense industry abroad because it helps sustain our defense industry base and supports jobs here at home.

For example, our agreement in December to expand our security cooperation with Saudi Arabia not only helps advance the security of a critical ally, it is projected to have a significant impact on the U.S. economy. According to industry experts, this agreement will support more than 50,000 American jobs. It will engage 600 suppliers in 44 states, and provide $3.5 billion in annual economic impact to the U.S. economy. This will support jobs not only in the aerospace sector, but also in our manufacturing base and support chain, which are all crucial for sustaining our national defense.

Third, we are also working to improve our ability to cooperate with our partners. Nothing shows our commitment to expanding U.S. exports more than our Export Control Reform efforts.

Our export control reform efforts are ultimately about making sure that our system appropriately protects the things it needs to protect and prioritizes how we protect them. To that end, we are focusing our efforts in the near term on the re-write of the U.S. Munitions List, or USML, and the Commerce Control List, or CCL, to create clear bright lines between munitions and dual-use items. Our work is focused now on the removal of the majority of parts and components from the USML to the CCL in these categories. They also will remove some end items, including unarmored military vehicles, cargo and utility aircraft, auxiliary surface vessels, and commercial communications satellites from the USML. We are working category by category, using objective rather than subjective criteria, to create that bright line between the USML and the CCL. We are making significant progress in this effort.

As part of our broader Export Control Reform Initiative, we have also recently reformed the broken "pre-notification" process with Congress. Under the old system, U.S. industry was placed at a competitive disadvantage as a result of the unpredictability and uncertainty of the process. This prompted our allies to question our reliability as a defense and security supplier. The new process, which is currently in place, has a tiered review process that, while bounded, allows significant time to review all potential arms sales under the Foreign Military Sales and Direct Commercial Sales programs.

Nothing about Congress and the Administration’s legal authority has changed under the reformed new system. Congress is still able to stop the entire pre-notification process if a Representative or Senator raises a concern. But under the new process, if a committee staffer thinks that an arms sale should be delayed, that staffer must escalate that concern to their representative or senator to convey to the Department. The Department has a strong history of being responsive to Member concerns, and this will not change.

We are committed to the new pre-notification process because we believe it will make the U.S. a more reliable partner and ally and will therefore help expand U.S. defense trade.

Lastly, we have advanced defense trade through the Defense Trade Treaties with the UK and Australia. This past April the United States and the UK signed an exchange of notes which brought the U.S.-UK Defense Trade Treaty into force. This treaty is the first of its kind and allows for the more efficient transfer of certain defense articles between the U.S. and UK. We are also making progress in the implementation of the treaty with Australia, which we hope to be completed in the next year.

So from all of this, I think it is clear we are doing a lot. And that we are going to keep you busy.

Before I close, I would once again like to thank the DTAG members for their willingness to serve and for their dedication in reforming defense trade. The last DTAG had a very busy – but successful – two years and I fully expect this DTAG to be just as busy and just as successful as the last.