FDIC SAYS CREDIT RISK IN SHARED NATIONAL PORTFOLIO UNCHANGED IN 2013

FROM:  FEDERAL DEPOSIT INSURANCE CORPORATION 

Credit Risk in the Shared National Credit Portfolio Unchanged

The credit quality of large loan commitments owned by U.S. banking organizations, foreign banking organizations (FBOs), and nonbanks was relatively unchanged in 2013 from the prior year, federal banking agencies said Thursday.

The volume of criticized assets remained elevated at $302 billion, or 10 percent of total commitments, which was approximately twice the percentage of pre-crisis levels. The stagnation in credit quality follows three consecutive years of improvements. A criticized asset is rated special mention, substandard, doubtful, or loss as defined by the agencies' uniform loan classification standards. The Shared National Credits (SNC) annual review was completed by the Federal Reserve Board, Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency.

Leveraged loans--transactions characterized by a borrower with a degree of financial leverage that significantly exceeds industry norms--totaled $545 billion of the 2013 SNC portfolio and accounted for $227 billion, or 75 percent, of criticized SNC assets. Material weaknesses in the underwriting of leveraged loans were observed, and 42 percent of leveraged loans were criticized by the agencies.

The federal banking agencies issued updated leveraged lending supervisory guidance on March 21, 2013. After declining during the financial crisis, the volume of leveraged lending has since increased and underwriting standards have deteriorated. The agencies expect supervised firms to properly evaluate and monitor credit risks in their leveraged loan commitments and ensure borrowers have sustainable capital structures.

Refinancing risk continued to ease in 2013 with only 15 percent of SNCs maturing over the next two years, compared with 23 percent for the same time frame in the previous review. Borrowers continued to refinance and extend loan maturities during the past year.

Other highlights:

• Total SNC commitments increased by $219 billion to $3.01 trillion, an 8 percent gain from the 2012 review. Total SNC loans outstanding increased $199 billion to $1.36 trillion, an increase of 10 percent.
• Criticized assets represented 10 percent of the SNC portfolio, compared with 11 percent in 2012.
• Classified assets, which are rated as substandard, doubtful, and loss, represented 6 percent of the SNC portfolio, compared with 7 percent in 2012.
• Credits rated special mention, which exhibit potential weakness and could result in further deterioration if uncorrected, increased from $99 billion to $115 billion, representing approximately 4 percent of the portfolio, a slight increase from 2012.
• Adjusted for losses, nonaccrual loans declined from $82 billion to $61 billion, a 26 percent reduction.
• The distribution of credits across entities, (U.S. banking organizations, FBOs, and nonbanks) remained relatively unchanged. U.S. banking organizations owned 44 percent of total SNC loan commitments, FBOs owned 36 percent, and nonbanks owned 20 percent.
• Nonbanks continued to own a larger share of classified (67 percent) and nonaccrual (72 percent) assets than their total share of the SNC portfolio. Institutions insured by the FDIC owned 12 percent of classified assets and 7 percent of nonaccrual loans.

The SNC program was established in 1977 to provide an efficient and consistent review and analysis of SNCs. A SNC is any loan or formal loan commitment, and asset such as real estate, stocks, notes, bonds, and debentures taken as debts previously contracted, extended to borrowers by a federally supervised institution, its subsidiaries, and affiliates that aggregates $20 million or more and is shared by three or more unaffiliated supervised institutions. Many of these loan commitments are also shared with FBOs and nonbanks, including securitization pools, hedge funds, insurance companies, and pension funds.

In conducting the 2013 SNC Review, the agencies reviewed $800 billion of the $3.01 trillion credit commitments in the portfolio. The sample was weighted toward noninvestment grade and criticized credits. The results of the review are based on analyses prepared in the second quarter of 2013 using credit-related data provided by federally supervised institutions as of December 31, 2012, and March 31, 2013.

SECRETARY OF STATE KERRY'S REMARKS WITH UN SPECIAL REPRESENTATIVE LAKHDAR BRAHIMI

FROM:  U.S. STATE DEPARTMENT
Remarks With UN Special Representative Lakhdar Brahimi Following Their Meeting
Remarks
John Kerry
Secretary of State
Winfield House
London, United Kingdom
October 14, 2013

SECRETARY KERRY: Thank you. Well, it’s my pleasure this morning to welcome Special Representative Lakhdar Brahimi here to Winfield House in London – it’s the home of our American ambassador – and to have a conversation, an important conversation, about the urgency of the convening of the Geneva conference, to try to achieve peace for a new Syria. And we talked about all aspects of this current crisis.

Special Representative Brahimi and I agree, as do many others, that there is no military solution in Syria, and we believe it is urgent to set a date, convene the conference, and work towards a new Syria.

We also, expressing my own point of view – because he’s the negotiator and it’s not his point of view to say this – but we believe that President Assad has lost the legitimacy necessary to be able to be a cohesive force, that could bring people together, and that it is clear that in implementing Geneva 1, which is the only purpose for having the Geneva conference now, there has to be a transition government. There has to be a new governing entity in Syria in order to permit the possibility of peace.

This will require all the parties to come together in good faith. The Special Representative will be traveling shortly to the region, meeting with all of the relevant countries, as well as the relevant parties. And he will be working on the question of the process for a Geneva 2 conference.

But for our part, the United States of America, together with the Russians, as we talked about it in the Far East a few days ago, are deeply committed to trying to set a date very soon, to moving towards an inclusive conference that will offer the best opportunity to end the violence, to provide for a new Syria, to deal with the humanitarian catastrophe that is only getting worse by the day, and ultimately to try to find a way to have peace and stability, not just in Syria but in the region.

And we are very, very appreciative to the Special Representative, for his commitment to this, for his hard work, for his team and their efforts. We believe that we’re in a position to try to get started. It will require good faith by everybody, but that’s exactly what we’re going to continue to work towards.

Mr. Representative, thank you.

SPECIAL REPRESENTATIVE BRAHIMI: Thank you very much, indeed.

SECRETARY KERRY: Thank you, my friend.

SPECIAL REPRESENTATIVE BRAHIMI: And I am extremely grateful to you, Secretary of State, for the opportunity you have given me, of heading for a new after your time in the Far East and your discussions with the Russians, who are your partners. You started this on the 7th of May in Moscow together. And we have joined with you in these trilateral discussions that we are having in Geneva several times. And we agree 100 percent that there is no military solution in Syria. There can be, there will be a political solution if everybody gets together and works for it.

I think that when we met in New York – with the P5 and the Secretary General and myself – we have said that this conference, Geneva 2, to implement Geneva 1, has to meet in November. And I think that very soon we’ve got now to set it. The (inaudible) for the conference to start and we look forward to everybody who can help the Syrians solve their problems must be there. And of course the Syrians themselves have to have private place in that conference, because the negotiations will be depend on them.

As you said, Secretary, I’m going to the region immediately after (inaudible) to see as many people as I can to discuss with them, hear from them, what are their preoccupations, what are their ideas, how they can contribute to make this Geneva conference that is coming success, for the Syria people, for our region, and for everybody. Thank you very much.

SECRETARY KERRY: Thank you, my friend. We are very appreciative of your work. Thank you so much. Thank you. Thank you all very much.

GUARD MEMBERS OFFER FLOOD RELIEF IN COLORADO

FROM:  U.S. DEFENSE DEPARTMENT
Local, Utah Guard Members Aid Colorado Flood Response
By Army Capt. Adam Musil
36th Infantry Division

AUSTIN, Texas, Oct. 11, 2013 - The 36th Infantry Division's Domestic All-Hazards Response Team-West continues to coordinate assistance requests and support for the Colorado flood relief effort.

"The floods have stopped, but the damage that remains provides huge problems for the people in the area," said Army Capt. Robert Anspaugh, the planner for Domestic All-Hazards Response Team-West, or DART-W. "The type of destruction ranges from simple road damage to roads being completely washed away, leaving large craters. Some people can't get to their homes and are having to backpack-in fuel and food."

The DART-W was notified of the flood weeks ago during a training exercise focused on hurricane and flood response. Within a few days of the notification, DART-W had soldiers on the ground to assist with coordinating the relief effort. DART-W helped establish the reception, staging, and onward movement centers for incoming troops and assessed unit capability gaps.

"Once we established the needs of the mission, we reached out to Guard units in the surrounding areas for additional support. The Utah National Guard will be the first to assist the Colorado units already in place," Anspaugh said.

The Colorado National Guard's 947 Engineer Company was the first to respond to the floods. The unit was activated Sept. 20. Within 48 hours, they were filling damaged roads. The Utah National Guard will provide additional engineers and equipment to double the engineer assets. The additional manpower will enable the units to set up rotations and provide continuous operations.

"We have assembled a rotational plan of Army and Air guards that will carry through November 25," said Army 1st Sgt. Christopher Schrag, DART-W noncommissioned officer-in-charge. "This will allow the units time to complete the entire Highway 36 and take on the smaller side roads before the major impact of the weather."

With already one snow this season, officials believe snow and cold weather will greatly hinder the units' ability to restore the roads.

"Realistically, we have until about the end of November to get all the roads fixed before the weather gets too bad," Anspaugh said.

Schrag, who returned early this week from Colorado, believes procedures have been set in place to provide for an effective response.

"This operation is a Joint Guard initiative. We have Guard units from two states [Colorado, Utah] on the ground now and Air and Army Guard units from an additional seven states [Kansas, Tennessee, New Mexico, South Dakota, Montana, Florida, Virginia] set to rotate in. I'm confident we can get the job done," Schrag said.

Comprised of Texas Army National Guard soldiers, the DART-W, based in Austin, Texas, at Camp Mabry, is responsible for synchronizing the National Guard response to major hurricanes, earthquakes and wildfires west of the Mississippi River.

The DART-W is one of two primary DAR headquarters. The other, DART-East is commanded by the 29th Infantry Division, and headquartered at Fort Belvoir, Va. Command of each headquarters rotates annually between Army National Guard divisions. The 36th Infantry Division has been selected to lead DART-W for two years.

SAVING MONEY AND LIVES THROUGH THE RETROGRADE PROCESS

FROM:  U.S. DEFENSE DEPARTMENT 
Retrograde Process Saves Lives, Money
By Claudette Roulo
American Forces Press Service

WASHINGTON, Oct. 11, 2013 - As the December 2014 Afghanistan drawdown deadline relentlessly draws near, thousands of service members and civilians at bases around Afghanistan are preparing tens of thousands of vehicles and containers filled with equipment and supplies for an intricate journey.

That journey -- whether it ends at a depot in the United States, or with a return to the field, sale to a foreign partner, or demilitarization -- could include transportation by air, ground or sea, or even some combination of the three. And the work won't end until the last containers and vehicles arrive at their destinations.

Determining the final disposition of the more than 24,000 pieces of rolling stock and 20,000 container equivalent sets in Afghanistan is the job of the unsung heroes of the Centcom Materiel Recovery Element, said Army Brig. Gen. Duane A. Gamble, the deputy commander of 1st Theater Sustainment Command, based at Fort Bragg, N.C. The command is responsible for supplying and moving troops throughout Afghanistan.

The fact that the CMRE exists speaks to the major difference between the drawdowns in Iraq and Afghanistan, Gamble said. When the drawdown in Iraq happened, theater-supplied materiel -- equipment and vehicles that stay in theater and are transferred from outgoing units to incoming units -- could be sent to Kuwait and sorted through there.

"Kuwait was our 'catcher's mitt' in Iraq," Gamble said.

With no precedent for need for an Army recovery unit, the task fell to the newly established CMRE and the 401st Army Field Support Brigade. They established central retrograde sorting facilities at Kandahar and Bagram Air Fields and began picking through the masses of equipment and vehicles arriving daily from across Afghanistan.

In April, that work was shifted out to the forward operating bases when seven joint field teams started performing the cost-benefit analysis of moving retrograde materiel, Gamble said.

Each team consists of a military forward retrograde element and a Defense Logistics Agency hub-based disposal operations team. The teams move from base to base, Gamble said, opening and sorting through containers and rolling stock.

"They're enabled with our standard Army retail supply system, where they're actually zapping each item and then ... it tells what the disposition is," he said.

As recently as this spring, there were thousands of containers waiting to be processed at the sort yards in Kandahar and Bagram, Gamble said, but the advent of the joint sorting teams helped eliminate that backlog.

"We hit a tilting point in about July where we were retro sorting and demilitarizing and shipping back to the United States more from our forward locations than we were from [Bagram] and [Kandahar]," he said.

Altogether, the CMRE and joint sorting teams are recovering about 91 percent of the value of the retrograde equipment, the general said.

"So, the high-dollar value items are being retained and shipped back to [the U.S.], where the high-volume, low-dollar items that don't make sense to retain or are just plain excess to requirements are either being redistributed forward or being disposed of forward," Gamble said.

Reducing the number of convoys moving retrograde equipment to and from centralized facilities, this setup saves time and money, he said, but more importantly, it saves lives.

"It keeps soldiers off the road, it keeps us from spending money on host-nation trucking to move stuff only to sort it out later and find out that maybe it wasn't worth that much money to begin with," the general added.

The retrograde process is saving lives in another way, too, Gamble said. Every piece of equipment is screened to determine if it's needed by another unit -- either in theater or elsewhere -- and in the case of the MaxxPro Mine-Resistant Ambush Protected models with survivability upgrades, "that is absolutely getting turned around to another unit that doesn't have the best and the latest," the general said.

The upgraded vehicles save lives, he said. "I've seen it. I've been here two months and we had four soldiers in this command hit an IED in one of those things and they all walked away," Gamble said.

At the same time retrograde equipment is transiting through Afghanistan and onward, units are still rotating in and out of the country. And their equipment rotates with them.

"Forces come and go all the time -- even during the surge we were still redeploying forces as some came in," Gamble said.

Equipment and materiel belonging to units that are deploying or redeploying has a higher transportation priority than retrograding equipment, Gamble said, because those units need it to operate in theater and they'll need it again when they get back to their home stations.

"Those forces have to go home and reset themselves to some level ... in order to get on with their next mission and be available in the force pool," he said.

Most of this equipment will leave Afghanistan via 'multi-modal' by air, to various sea ports for movement back to the U.S., Gamble said. The actual volume will vary from month to month based on the sizes of the units rotating in and out of theater.

In contrast, equipment and materiel that is being retrograded is being moved out of theater over various land routes or flown to a multi-modal site. From there it will move by sea back to depots in the U.S. to be prepared for redistribution and reuse. The routes are directed by U.S. Transportation Command, but the destinations are determined by the type of equipment being retrograded.

That means, for the Army, vehicles are sent to a 'hard iron' depot like Anniston Army Depot in Alabama, while replacement parts or supplies are sent to supply depots like Sierra Army Depot in California, which processes conventional ammunition.

The same holds true for the other services, the general noted. The Air Force and Marine Corps send their equipment to their own depots.

With the total cost of the retrograde estimated to be between $5 and $7 billion, according to a senior defense official, there's particular emphasis on using the most economical routes to move retrograding equipment.

In its route planning, Transcom must balance cost with external factors like the political climate and the effect of holidays on the availability of labor with internal security conditions and with the need to "keep most routes warm," Gamble said.

For example, in August, 60 percent of retrograding equipment was transported via air -- both direct and multi-modal -- in a deliberate strategy to mitigate the effects of Ramadan and Eid al-Fitr, he said. And in February, 100 percent of the retrograde equipment was transported by air because the Pakistan Ground Lines of Communication were closed.

However, very little of this movement is ever via direct air, the general noted. What little retrograde equipment does arrive in the U.S. via direct air is usually "opportune air," he said. By pre-staging retrograde equipment at airfields, the military is able to take advantage of available cargo slots on transport aircraft.

In normal circumstances, "the amount of retrograde that goes back direct air to the United States ... is so small it's not even worth mentioning, so when we say air for retrograde, we're talking multi-modal almost exclusively," Gamble said.

With several different routes and means available for retrograding equipment, Transcom directs the movement of retrograde equipment based on traffic and price, the general said, noting that price is usually the deciding factor.

The Northern Distribution Network presents several challenges. The network transits several countries with restrictions on the types of equipment that may enter or be visible. So, Gamble said, cargo sent via the NDN must be containerized.

"We just finished a trial run with some armored vehicles, but they had to be containerized, so that limits it -- if you have to put it inside a container to transit the countries, that's quite limiting ... we don't have a lot of small armored vehicles," he said.

The route isn't as fast as the Pakistan GLOC, but it will serve containerized equipment very well, Gamble said.

"So, we're mostly for October scheduling materiel like repair parts, etc., in containers to go out the NDN," he noted.

The Pakistan GLOC is the cheapest route, said the senior defense official, but it reopened only recently after Pakistan closed it in 2011 and Afghanistan closed it briefly again earlier this year.

After the Pakistan GLOC reopened, it quickly became the dominant route for retrograde, Gamble said.

By September, 70 percent of all retrograde equipment was moved out of the country over land, and 98-99 percent of that movement was via the Pakistan GLOC, he said. For September and October, approximately 60 percent of all retrograde equipment will be moved out of the country by land.

"When the ground is working, or it's not interrupted by holidays, we take advantage of the ground and we minimize the air. When the ground isn't as attractive because of stuff like holidays, then we tilt the other direction," Gamble said.

"It's this flexibility that keeps us very confident that we can continue the retrograde mission no matter what Mother Nature throws at us, no matter what the holiday seasons throw at us," the general said.

SPECIAL BRIEFING ON BILATERAL SECURITY AGREEMENT

FROM:  U.S. STATE DEPARTMENT 
Background Briefing: Senior State Department Officials and Senior Administration Official on Bilateral Security Agreement

Special Briefing
ERT London, England
October 12, 2013

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Okay.  So we're just going to do a quick backgrounder on the meetings that Secretary Kerry just had in Afghanistan, and a readout of those.  And we have Senior State Department Official One, Senior Administration Official One here.  And if I have anything, I'll be Number Two.

So, I think we'll do an overview first, and then do some questions, if that works.

SENIOR ADMINISTRATION OFFICIAL ONE:  So the visit, obviously, was focused on the Bilateral Security Agreement.  It comes 11-ish months into the negotiations.  It was generally productive.  From our vantage, positive in that we reached a basic agreement on all of the key issues.

The President – when President Karzai visited Washington last January, the President announced our objectives for a post-2014 presence as being, first, a train, advise, and assist mission under NATO leadership, and then also a CT mission, by which --

QUESTION:  Train, advise, and what?

SENIOR ADMINISTRATION OFFICIAL ONE:  Train, advise, and assist mission.

QUESTION:  Assist.

SENIOR ADMINISTRATION OFFICIAL ONE:  And also a counter-terrorism mission, by which we could pursue the remnants of al-Qaida.

And the language of the agreement as it stands right now provides what we need for both of those missions.  And, more importantly, as with every status of forces agreement worldwide, the language also provides what we need in terms of assurances and guarantees for rights of self-defense, for force protection, and the jurisdiction issues that are obviously so important to us.

So, overall, the text, we believe, is in a good place.  And I think we stayed a little bit longer than we had hoped, but I think it was worth it in that we were able to come to that basic agreement.

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Why don't we do some questions?

QUESTION:  Before we get into the – what the Secretary was talking about – strike that.  (Laughter.)  Before we get into the area that is not – that still is awaiting – the most contentious issue, the jurisdictional issue, can you explain to us what exactly the – has been agreed, in terms of the counterterrorism stuff and in terms of sovereignty?  Like, Karzai made a big deal out of the definition of "invasion" and the definition of "sovereignty."  Can you explain what that is, or is it just like a standard dictionary definition?

SENIOR ADMINISTRATION OFFICIAL ONE:  The most important thing President Karzai had said to us he needed out of the Bilateral Security Agreement was the ability to take it to his Afghan people and explain how it was going to bring security to Afghanistan beyond 2014.

The other thing that he said he needed was – and this was coming out of the Strategic Partnership Agreement – was improved understanding between the two of us in terms of what threats faced Afghanistan, both externally and internally.  And what we were able to do, I think, in very broad terms, is find that common understanding in these 24 hours of talks, both in terms of the threats that Afghanistan faces internally and externally, the final language to characterize those threats, and then, more importantly, to characterize our commitment to enable the Afghans to defend themselves against those threats.  And I think that was one of the major very difficult issues that was left to this late stage that we needed to work through.

QUESTION:  Can you say what it – what the language says?

SENIOR ADMINISTRATION OFFICIAL ONE:  No.

QUESTION:  Is that because – and you can't say because you're waiting for – you don't want to preempt the Loya Jirga, or --

SENIOR ADMINISTRATION OFFICIAL ONE:  Yeah.  I think we would want to wait until the right time, until the internal processes are more mature.  We --

QUESTION:  Yours or theirs?

SENIOR ADMINISTRATION OFFICIAL ONE:  Both.  We have to put ours through a very technical, internal legal review.  They have to put theirs through their interagency equivalent process with their national security council, and then prepare it to take to their people.  And we certainly wouldn't want to disclose dimensions or parts of the language prematurely.

QUESTION:  But it will be at some point.

SENIOR STATE DEPARTMENT OFFICIAL ONE:  The language will be public, eventually.

QUESTION:  [Senior Administration Official One], you were talking about defining the threats to Afghanistan and their ability to defend themselves.  Is this the reference to the part about Afghanistan wanting the U.S. to give it a sort of defense pact, and that we would defend them against outside threats, presumably from Pakistan?  That is part one of the question.

Part two is the issue on counterterrorism and them wanting us to hand over our intel and they do their own ops, and how did you address that?

SENIOR ADMINISTRATION OFFICIAL ONE:  Yes, on the first part, that the Bilateral Security Agreement is clearly something that stopped short of a mutual defense pact.  And the language that we found, I think, is sufficient to both parties in terms of not overreaching the bounds of what can be – what kind of commitments we can come to.

On the counterterrorism language, it's a broad concept of cooperation at this point, which I think allows for enough flexibility in terms of their evolving capabilities, but also our needs to take actions in a joint, cooperative manner, when we need to.  So, it's not so clear as, "Hand over the intel and we'll take care of it."  It's not at that kind of an evolved stage.

QUESTION:  When you say, "when you need to," for joint actions, did you clarify when that would be?  When would those joint actions take place?  I mean is – would you have to define under what circumstances?

SENIOR ADMINISTRATION OFFICIAL ONE:  Well, I think the circumstances are any circumstances where the – there is a transnational threat, one that could impact upon U.S. homeland, U.S. allies, U.S. interests.  But in all cases, that we would do so in a manner that was cooperative, in some cases – in many cases, partnered.

SENIOR STATE DEPARTMENT OFFICIAL ONE:  Well, I think it's important to add that that's the way we would describe how we're handling CT right now.  This is not a dramatic departure from the way that we're handling those operations under current policy guidance, the difference being that this is – when it goes into force, it would be a legally
binding agreement.

QUESTION:  Can you please describe what – on this issue of immunity?  Because from where we were sitting, it sounded, or personally to me, that this really couldn't be a deal unless that was agreed upon.  And if the Secretary – or if an official is saying that it is in the text, well, then there is an agreement.  But he was pretty clear in his quotes during the news conference that they weren’t --

SENIOR ADMINISTRATION OFFICIAL ONE:  Let me put it this way.  We've agreed on language that can be put to his Loya Jirga for their consideration.

QUESTION:  In terms of the U.S. side, though, other than just this interagency review, I mean, the Pentagon is not going to come back and say, "Sorry, this doesn't work for us."  It's a done deal, from the U.S. perspective.

SENIOR STATE DEPARTMENT OFFICIAL ONE:  Well, I mean, that's the corollary to what [Senior Administration Official One] – the elaboration on what [Senior Administration Official One] said is the language that is in the text that goes to the Loya Jirga is satisfactory for our purposes on the --

QUESTION:  So it’s the same question.  As far as you're concerned, what you got is good, and it – and then – and I have this question I asked [Senior State Department Official One] earlier.  Who signs it, if it gets approved by --

SENIOR ADMINISTRATION OFFICIAL ONE:  Don't know yet.

QUESTION:  But is it a presidential thing, or is it a Secretary --

SENIOR STATE DEPARTMENT OFFICIAL TWO:  We don't know what yet.

QUESTION:  Who would sign it?

QUESTION:  You don't know?

SENIOR ADMINISTRATION OFFICIAL ONE:  Yeah, we don't know the details of the signing phase.

QUESTION:  Why not?  I mean, and – obviously, I guess not.  But, I mean, other agreements like this --

QUESTION:  Procedurally.  Like, who signs it?

SENIOR ADMINISTRATION OFFICIAL ONE:  I think it could be signed by a number of --

SENIOR STATE DEPARTMENT OFFICIAL ONE:  There are a lot of options.

SENIOR ADMINISTRATION OFFICIAL ONE:  -- Cabinet or Administration people.

QUESTION:  So it doesn't need to be president and president?  It can be --

SENIOR ADMINISTRATION OFFICIAL ONE:  Not necessarily.

SENIOR STATE DEPARTMENT OFFICIAL TWO:  No.  It could technically be a range of people.

And the other piece on the – just process-wise, is that the Secretary spoke with Secretary Hagel a number of times over the last 24 hours.  He spoke with Susan Rice a number of times, other people on the team.  And you guys would know better all the people that were – you were in contact with.  But – about the text and the progress.

SENIOR ADMINISTRATION OFFICIAL ONE:  We were in constant contact with the legal support team in Washington, and, as [Senior State Department Official Two] said, both --

QUESTION:  And then my last one is --

QUESTION:  (Inaudible.)

SENIOR ADMINISTRATION OFFICIAL ONE:  I can't say whether Ambassador Rice was in touch with the President.  But the Secretary was in direct contact with Ambassador Rice several times.

QUESTION:  My last one here, and you can – it's a chance for you to talk up your boss.  What was it – I mean, this stuff hadn't been agreed to beforehand.  So what was it that the Secretary brought into this that got it done, basically?  What – I mean, how did he change the dynamic?  For 11 months, you haven't had a deal.  You still don't, technically, but you got what could be a deal.  So what was it that he was able to do to change the dynamic to get something done?

SENIOR STATE DEPARTMENT OFFICIAL TWO:  I can start, but – I know.  But still, I can talk just --

QUESTION:  Just don’t make it too hagiographic.

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Too what?

QUESTION:  Hagiographic.

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Hagiographic?

QUESTION:  Hagiographic.

QUESTION:  (Inaudible.)

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Okay.  Too – okay.  One is their personal relationship and the fact that it goes back for a number of years, and you all know the details of that because we’ve talked about that previously and many of you covered it.  Two is persistence.  You’ve all covered the Secretary on a number of these occasions, on a number of these journeys to try to get agreement, right?  And he is somebody who will sit there for hours and talk through the substantive issues, and this is something they can add more to.  And three is probably patience.  I didn’t even mean to do a three-piece.  But patience, because obviously he wanted to --

QUESTION:  (Inaudible.)

SENIOR STATE DEPARTMENT OFFICIAL TWO:  I didn’t plan it.  (Laughter.)  But --

QUESTION:  What about personality?

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Sure.  But they can add a little more perhaps from in the room, but, I mean, I think those are some of the characters and characteristics of these --

SENIOR STATE DEPARTMENT OFFICIAL ONE:  Fully agree with all that, and I would say also that sometimes you get to a point in these sorts of negotiations where both sides need higher-level political involvement to sort of get things further along.  And it’s not clear the degree to which President Karzai had been engaged on the text before these last couple of days.  Secretary Kerry obviously had been monitoring the negotiations, but had not been personally involved until the last couple of days.  And having that kind of higher-level political push, I think, was essential to the progress that was achieved.

QUESTION:  So would you agree with the characterization that this is really kind of a deal, or at least the last points fell into place – the last points falling into place is a deal between Karzai and the Secretary?

SENIOR STATE DEPARTMENT OFFICIAL ONE:  I think it’s a deal between the United States and the Government of Afghanistan.

QUESTION:  I know.  In closing the circle, it was him and Karzai.

SENIOR STATE DEPARTMENT OFFICIAL ONE:  The high-level political involvement was key to getting it to where it is now.  There is no doubt about that.

QUESTION:  To follow on that, so can you say now, then, that the purpose of this trip really was for the Secretary to close the deal?  I mean, there was a lot of discussion ahead of time about --

SENIOR STATE DEPARTMENT OFFICIAL ONE:  I think we had a – I think we had to see where things stood.  I mean, I don’t think I – I certainly didn’t deliberately mislead you when I said the other night he wasn’t coming here to close the deal, and I think he had a positive conversation with Karzai a week ago.  Did we know, when he had a positive conversation, that the result if we showed up here was going to be getting what we got?  No.  But he knew that it was worth testing the proposition, and so here we are.

QUESTION: Was there any discussion about troop levels?

SENIOR ADMINISTRATION OFFICIAL ONE:  I don’t think so.

QUESTION:  So are there going to be (inaudible)?

QUESTION:  (Inaudible.)

SENIOR STATE DEPARTMENT OFFICIAL ONE:  So I defer to [Senior Administration Official One] on this.

SENIOR ADMINISTRATION OFFICIAL ONE:  I didn’t hear.

SENIOR STATE DEPARTMENT OFFICIAL ONE:  About troops (inaudible).

SENIOR ADMINISTRATION OFFICIAL ONE:  Yeah, all of our troops are trained and capable of conducting combat operations.  There will be no combat mission after 2014.  And what is clear is that combat operations would be much more exceptional after 2014 --

QUESTION:  Much more what?

SENIOR ADMINISTRATION OFFICIAL ONE:  Exceptional.

QUESTION:  So CT doesn’t fall under combat, it’s a separate category?

SENIOR ADMINISTRATION OFFICIAL ONE:  No, I think it could.  I think that the range of combat operations that you would have seen will be greatly reduced from what you have now.  Frankly, they would be, again, the counterterrorism mission to go after residual transnational threats, and then there could be some combat operations in terms of the troops that are working inside the training, advise and assist mission.  And then of course, if there were ever a contingency where you have a force protection mission, that could also be a combat operation, but that would be as a contingency, not as a general rule.

SENIOR STATE DEPARTMENT OFFICIAL TWO:  All right.  They’re trying to serve dinner.

QUESTION:  Thank you.

QUESTION:  And what was the time of the meetings?  Was there a time today?

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Let’s see, 9:30 to 12:15, then they broke for about two hours, though there were still talks between the teams, and the national security advisor hosted the lunch.  So – and then they reconvened at 2:15.  That went until about four-something, 4:30 maybe.  They had about 30 minutes by themselves.  Then --

QUESTION:  (Inaudible.)

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Yeah, at the end.  Then they came back at 6:30, and we did the press avail at 9:00.  So – and they had maybe 10 minutes by themselves before the avail.  So, okay, I don’t know if anybody was adding that up.

QUESTION:  (Inaudible.)

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Eight hours today.

QUESTION:  And then yesterday?

SENIOR STATE DEPARTMENT OFFICIAL TWO:  And yesterday, yeah, it was about three hours.  Yeah.

QUESTION:  And on the calls, were they back to Washington?

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Yeah.

QUESTION:  When were they?

SENIOR STATE DEPARTMENT OFFICIAL TWO:  I mean, they were throughout the last 24 hours.  I mean, Secretary Kerry spoke with Hagel around this morning, before the day began.  He spoke with him again, I believe.  I’ll double check this.  I can probably get you guys a list of the calls he did.  But he spoke with Hagel and Rice a number of times.  Other people on the team spoke with a number of other officials as well.  Like, the Admiral, I think, spoke with somebody from the Joint Chiefs, and so on and so forth.  But --

QUESTION:  (Inaudible) the Secretary’s answer to my question on the Taliban (inaudible) some confusion over communication (inaudible)?

SENIOR STATE DEPARTMENT OFFICIAL ONE:  There’s a chain of command.

QUESTION:  Did Karzai ask him (inaudible)?

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Not that I am aware of.  I mean with – I don’t know that there’s much more we’re going to add on that, but I’ll talk to folks who were in all the meetings.

QUESTION:  Afghan security forces (inaudible)?

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Okay.  I’ll ask and see if there was more talk of it aside from the one that we mentioned last night.

QUESTION:  Was he trying to (inaudible) answer to the question of why there was, like, a miscommunication on the U.S. side when the Secretary --

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Not the U.S. side.

QUESTION:  Oh.  See, I kind of assumed (inaudible).

SENIOR STATE DEPARTMENT OFFICIAL TWO:  I don’t think he was implying the U.S. side.

QUESTION:  So he was implying there was a miscommunication (inaudible).

SENIOR STATE DEPARTMENT OFFICIAL TWO:  I will talk to folks and see if there is more we can explain.

QUESTION:  (Inaudible.)

SENIOR STATE DEPARTMENT OFFICIAL TWO:  Yeah, I get it.  Okay.

QUESTION:  Thank you very much.

THE GOVERNMENT SHUTDOWN AND CIVILIAN MORALE

FROM:  U.S. DEFENSE DEPARTMENT 
DOD Leaders Worry About Shutdown's Effect on Civilian Morale
By Jim Garamone
American Forces Press Service

WASHINGTON, Oct. 11, 2013 - The partial government shutdown is hurting DOD civilian morale, the department's comptroller told Congress yesterday.

Under Secretary of Defense Robert F. Hale told the House Armed Services Readiness Subcommittee DOD civilians have been through a lot over the past year and it is hurting productivity.

The furloughs triggered by the shutdown that began Oct. 1 are only the most recent instance of this damage, Hale said. Civilian employees have not had annual raises for more than three years. Hiring freezes, cuts in training, cuts in bonuses and step increases all work to erode morale.

Earlier this year, almost all DOD civilians were furloughed under sequestration for six days.

The lapse in appropriations that began Oct. 1 continues to affect morale. Around 400,000 DOD civilian employees were furloughed after the fiscal 2013 appropriations lapsed. About 95 percent of them were recalled under the Pay Our Military Act. Still, there are around 7,000 DOD civilians remaining on furlough.

"In the first days of the lapse, commanders repeatedly told me that civilian workers were frustrated and angry," Hale said. "And I can't imagine they'd be any other way."

The comptroller said many DOD employees say they will retire or resign and seek other jobs.

"And low morale means low productivity at most DOD support activities," Hale said.

Later in the hearing, Hale corrected a representative who called furloughed employees "non-essential."

"Please don't use the word non-essential as regards our civilians," he said. "The folks that are still on furlough are essential. We can't operate without them in the longer term. It is very ... harmful to morale. Call them nonexempt or non-excepted, but please don't use that phrase."

KERRY, KARZAI MAKE REMARKS AFTER MEETING

FROM:  U.S. STATE DEPARTMENT 
Joint Press Availability With Afghan President Hamid Karzai After Their Meeting
Press Availability
John Kerry
Secretary of State
Kabul, Afghanistan
October 12, 2013

PRESIDENT KARZAI: (Via interpreter) (Inaudible) Afghan and international media, the United States media, welcome to our today’s press conference. And we apologize for making you waiting from morning up to now. Thanks for being so patient. And I’m very happy that today, His Excellency John Kerry, U.S. Secretary of State, is here with us in Kabul. He arrived here yesterday so that we can discuss our relationship with the United States, especially with regards to the security pact between Afghanistan and the United States. He has been kind enough to spend enough time with us, and we – he delayed his visit to Middle East so that we could discuss these issues in details, and both sides, so that we can both reach a result considering other national interests, both countries.

Are you all right?

SECRETARY KERRY: I’m all right, but I don’t hear anything.

PRESIDENT KARZAI: (Via interpreter) Can you hear? Sir, can you hear us now?

SECRETARY KERRY: Yes.

PRESIDENT KARZAI: Can everyone hear us?

Brothers and sisters, as you are all aware, that after we signed the Strategic Partnership Agreement between Afghanistan and United States, we started to discuss security. Let’s wait until we get the system fixed. Okay.

As you are aware, after we signed the Strategic Partnership Agreement, the United States and Afghanistan started discussing the security agreement between our two countries. It was a very difficult discussion. Afghanistan considered its own interest, United States considering its own interest. Afghanistan’s interest is Afghanistan. Our main priority is Afghan sovereignty. Respecting Afghanistan’s sovereignty was considered our highest priority. Unfortunately, our past experiences were not happy experiences. Afghanistan suffered a lot in the fight against international terrorism. Afghan houses suffered a lot. And Afghanistan’s sovereignty has been violated, and the Afghan Government and the Afghan people were disappointed about all this.

The discussion of the security agreement has been an important issue, and our demand is our – defending our Afghan sovereignty. Afghanistan’s national sovereignty was our most important issue for all of us. It has been. And one of the other important thing for all of us was the safety of the Afghan people as well as their assets and property from terror and terrorism, as well as from the fight against terrorism that’s been conducted by international forces. And the Afghan people suffered a lot so far.

Only 15 days ago, I met a very young girl from Kunar province of Afghanistan in a hospital. She lost her both eyes. She was 14 and a half years old. Her – she lost her face as well as her hand – one of these. And she also lost her whole family. It happened during foreign forces operation. The Afghan nation, whatever cost they paid, want a guarantee that such violation will not take place in terms of the lives of the people, children, and citizens. And under no circumstance or excuse, foreign forces will not search the homes of the Afghan people, the people of Afghanistan; will not attack – will not conduct any sort of ground attack or air attack on the Afghan homes.

The third issue is invasion or attack on Afghanistan. In our Strategic Partnership Agreement, it states United States committed itself to support Afghanistan in case of attack on Afghanistan. But we realized that we, once we signed the Strategic Partnership, some of our neighboring countries shot rockets and missiles on Afghan territory, but the United States did not even accept that such violation did take place in Afghanistan. At this point, the definition of invasion or attack was very important for all of us, so that we can have a clear definition of attack on our country or invasion of our country. Invasion means bringing mortars and tanks to Afghanistan. Invasion also means sending terrorism and suicide bombers to Afghanistan.

Four, and stopping foreign forces from whatever they do in Afghanistan so that international forces cannot conduct operations by themselves without permission. The Government of Afghanistan and I myself, during the past few years, have been in touch with security forces of other countries who are here to fight terror and defend their interest, and we had some sort of disappointments as well. In these cases, Afghanistan’s sovereignty and definition of invasion, civilian casualties in Afghanistan, and prevention of foreign forces operation – we have been discussing this for a long now.

After a long discussion and exchanging thoughts and ideas, tonight we reached some sort of agreements. In our agreements, the United States will no longer conduct operations by themselves. We have been provided written guarantee for the safety of Afghan people about invasion. A clear definition has been provided and we accepted it. Our national sovereignty is being also clear, and they have committed themselves that they will respect and no violation will take place.

The security agreement we discussed today, many issues are related to this agreement. One element is foreign forces immunity. We don’t have a common understanding on this, and such an issue is beyond Afghan Government authority. We therefore did not discuss this issue. And the decision about this particular subject will – is up to the Afghan people and especially the Loya Jirga. They will be the one to make the decision on this particular issue. The Afghan – this will go to the Afghan people, the Jirga itself, and it will be then sent to Afghan parliament, and such issue is beyond our authority, and it will be presented to Afghan people at Loya Jirga.

There are other things. There are other issues. We had a common understanding and a common agreement, but I have been – I stated the most important issues during the past three nights, and I just mentioned these issues. But I did not study the details, the technical details of this particular agreement, and I will have time tomorrow to study the details, to study the agreement in details, and I will then send it to the Afghan Security Council and I will then also consult with the (inaudible) jirga, and then it will be presented to Afghan people’s Loya Jirga, and they will be the one to make a decision, the final decision. If they approve it, it will be sent to Afghan parliament, and so that they can approve it too.

I just would like to be short on this. In this agreement, we considered national sovereignty and prevention of casualties, civilian casualty, and the clear definition of invasion. We reached some agreements. We reached agreements. Foreign troops and forces, foreign forces immunity, we were not able to discuss this because it is clear, because the Afghan people’s Jirga will make their decision about this.

The whole document will be presented to the Loya Jirga. They will discuss it, especially this particular issue. United States Government and people, we are grateful of the American assistance to Afghanistan in order to bring changes in the area of education and the life of the Afghan people, and they did provide help in other areas too, and we are grateful of that. But we are hopeful beside we – while we appreciate this, we hope that the security agreement between Afghanistan and the United States, once the Jirga approve it, they will provide us with the things that we did not have during the past 10 years in Afghanistan, which is the safety of the Afghan people as well as the national sovereignty.

We hope to reach these goals, and we will present the document to the American people too. And I am grateful to His Excellency John Kerry and as well as the American people. We hope that once we finalize this agreement, the Afghan – Afghanistan and Americans will become real friends, friends in reality. Thank you so much.

SECRETARY KERRY: Well, Mr. President, thank you very, very much. Thank you first of all for your generous hospitality, as always. We appreciate it enormously. And I don’t know who could produce a setting like this, which is really very, very beautiful. As we walked over here, the President informed me that some of these trees are probably more than 300 years old, maybe more.

PRESIDENT KARZAI: Maybe more.

SECRETARY KERRY: Maybe more. So it’s a privilege to stand in a place that reminds us all about the history of Afghanistan, the durability, and really the importance of what we are trying to achieve here.

I thank the President for his serious effort over these last hours. Late last night, all last night, all today we have been discussing and we have been negotiating. And as the President said, these are not easy negotiations because they involve issues of life and death, issues of the future of a country, issues of emotions, and the history. Particularly, the kinds of things the President talked about, about a young woman without a face. And indeed, there have been horrible things that have happened to people in the course of war. Too many Afghans have lost their lives. Too many Afghans have been subject to terrible violence. And the United States hopes and prays and looks forward to the day that Afghanistan can be free from that violence and that the people of Afghanistan will be free to move around and live their lives with full respect for their sovereignty and for their nationhood, for who they are as a people. The people of Afghanistan are a brave people, a capable people. And the United States has only respect for what the people of Afghanistan have been through and how difficult these years have been.

We also know that there are young men in hospitals in America, and women, who are still recovering from their wounds. And there are too many who have been buried in cemeteries in America because they came over here to help make a difference for this country and for the world – to fight terrorism, and to fight to give an opportunity for Afghanistan’s future to blossom in its full sovereignty and with the full opportunities that people need and deserve.

We are proud of the fact that in the years that we have been here, in cooperation with President Karzai and the government, much has changed for the better. When we came here, there were maybe a million children in school, most of them boys. Today, there are 8 million, and perhaps 40 percent of them are young girls. When we came here, only 9 percent of the people in Afghanistan had access to health care. Today, 60 percent of the people in this country have access to health care. And when we came here, the life expectancy of Afghans was 20 years less than what it is today. It has grown by 20 years. There are many things that are positive, even as there have been great difficulties.

We want a different relationship. President Obama wants the United States to work in partnership with Afghanistan. And nothing would please us more or serve American interests more than to see an Afghanistan free and independent, and without the need for support from America or any other country. I know that’s what President Karzai wants. That’s what we want.

And I believe that in the last 24 hours, as we have worked hard at these issues that really have been negotiated over now for more than 11 months, that we have resolved, in these last 24 hours, the major issues that the President went through. We have resolved those issues. And we have put ourselves in a position for an enduring partnership going forward in the years ahead, providing that the political process of Afghanistan accepts that. We respect completely the President’s need, the President’s right, the Afghan people’s need to approve of whatever agreement might come forward. We are pleased that the agreement that we have put together now is in a place where it can be submitted to a Loya Jirga, where it will now go through the appropriate political process of the President reviewing it and submitting it with his security cabinet, with his various – with the parliament and others, as is necessary.

But I need to make very clear that the one issue that is outstanding, which is an issue that we call an issue of jurisdiction – in our judgment, there is no immunity in this agreement. Anybody who were to do anything will be subject to the law. But the question of jurisdiction is an appropriate one for the President to submit to the Loya Jirga, and we have high confidence that the people of Afghanistan will see the benefits that exist in this agreement. But we need to say that if the issue of jurisdiction cannot be resolved, then, unfortunately, there cannot be a bilateral security agreement. So we hope that that will be resolved. And it’s up to the Afghan people, as it should be.

What we have achieved in this agreement addresses the fundamental questions the President has raised about aggression, about support, about – most importantly – the protection of Afghan people in their homes, in their lives. We respect completely, and President Obama supports and is committed to the principles that the President of Afghanistan has laid out in order to protect the people of Afghanistan. The people deserve to know that in their homes and in their lives they can be free from interference and free from violence. And we believe in that.

What has happened in this moment is important. It is a moment where the United States willingly and happily is able to work in partnership with our Afghan friends and transfer to the Afghan forces the full responsibility for the defense of Afghanistan as we near the end of 2014, and we will be in a very different position here – happily for the President, the government, and the people of Afghanistan. We will not be conducting combat operations; we will be engaged in training, assisting, and equipping the Afghan forces who will defend their country. And I think the President and the people of Afghanistan welcome that.

So in the agreements that we have reached here, we have in fact arrived at a point where we know with certainty how we can proceed down the road, to fully – fully guaranteeing the opportunities that the Afghan people want for their future.

We will have a respect that the President wants in a definitive way for the sovereignty of Afghanistan and for the people of Afghanistan. And over the coming year, the Afghan people will be assuming greater and greater responsibility. We welcome that. And we say very simply that this agreement, if it finally approved, will cement a relationship of cooperation, a relationship where the Government of Afghanistan is fully independent and sovereign and making its decisions, and the United States and those other friends who join in this effort will be helping and working in cooperation.

In addition, we will be following along the lines of what was agreed in Tokyo and in Chicago in terms of assistance, which will be important in order to sustain the development and the growth that has so characterized what has happened, even in the midst of war.

The Bilateral Security Agreement also provides the foundation for us to be able to work together against terrorism, against those who wish to harm us or our partners, our interests, and the region. And that is vital to both Americans and to Afghans. But let me underscore that nothing – neither this agreement when completed, nor the assistance that we provide – nothing can replace the commitment and energy of the Afghan people to be defining their own future.

So it is clear, through this agreement in addressing each of the concerns President Karzai has raised, that President Obama and the American people believe in the people of Afghanistan. We are excited about the way the President and his government have put in place the workings of a new election. The election law, the registration of candidates, are all a great success. And we look forward to not picking any candidates, not being involved in the election, not in any way affecting it, but only to helping in any way that Afghanistan wants us to for this election to work effectively, free, fair, accessible, transparent, and accountable. This is an enormous transition. It’s an historic moment for this country. And we are proud and pleased to be able to work at being part of it.

The United States believes firmly that lasting security and prosperity in a unified Afghanistan and an independent Afghanistan, whose people and sovereignty are respected, will take root when the people’s voice is heard in the course of this election. And this will be a great legacy for President Karzai, who has led his country during these very, very difficult times.

So Mr. President, I’m very, very grateful to you as always. Your friendship, your warm welcome, the serious way which you and your team have really come at the difficult issues that we had to work on in the last few days. And we look forward to the technical review process that you will undergo, we will likewise undergo, and I am confident that in this agreement, we have laid the foundation for all of the issues that you listed to be addressed, and for the future success of your country and our friendship. Thank you, my friend.

MODERATOR: (Via interpreter) It is very late. We will just take two questions. The first question can be addressed to – the Secretary of State will choose the first question, and I will ask – pick up the second question.

SECRETARY KERRY: If I’m picking first, Lesley Wroughton.

QUESTION: Lesley Wroughton from Reuters. Mr. Secretary, you said that there’s no deal without addressing the issue of immunity. How does one proceed with this, and what kinds of concessions do you need from each other to close this deal?

The same for you, President Karzai. What do you need for this – if the U.S. doesn’t seal this deal, if this immunity issue is still outstanding, how do you see this relationship going forward?

The other question I have for the Secretary –

SECRETARY KERRY: That’s all right – as I cough away. (Laughter.)

QUESTION: I’m sorry.

SECRETARY KERRY: It’s all right.

QUESTION: And the other question I have – so I’m (inaudible) with the immunity. The second question is: What faith – this is for the Secretary. What faith does it show in Afghan sovereignty when the U.S. snatches a Taliban commander from Afghan hands when you’re so close – when you were so close to a deal?

To the President – how can Afghanistan stand for this kind of operation, and does it undermine you just when you’re trying to agree on issues of counterterrorism and security?

SECRETARY KERRY: Yes. Well, let me – Lesley, let me begin by, first of all politely correcting you, the premise of your question about something called immunity. There is no immunity. There is no question of immunity. If an American who is part of any expeditionary force under agreement from the Afghan Government were to violate any law, as we have in the past, we will continue to prosecute to the full measure of that law, and any perpetrator of any incident, crime, anything will be punished. There is no immunity. Let me make that clear: No immunity.

And we have proven in many cases, unfortunately too many instances, that when somebody has violated the law, they have paid the price. There are people in prison today in the United States of America who have paid that price.

Secondly, with respect to the jurisdiction issue, we have great respect for Afghan sovereignty. And we will respect it, completely. And that is laid out in this agreement. But where we have forces in any part of the world, and we unfortunately have them in a number of places in the world – in Japan, in Korea, in Europe, in other parts of the world, Africa. Wherever our forces are found, they operate under the same standard. We are not singling out Afghanistan for any separate standard. We are defending exactly what the constitutional laws of the United States require.

Now, we completely respect that the President should decide appropriately that this issue ought to be decided in his Loya Jirga. We absolutely – that’s the best of democracy. We embrace that. But there are realities that if it isn’t resolved, we can’t send our forces in places because we don’t subject United States citizens to that kind of uncertainty with respect to their rights and lives. It is no comment on any other country. It’s nothing negative. It’s an historical tradition and something that exists everywhere in the world. So that is a very important principle.

Now, the President has expressed his concerns. He’s been honest with us and upfront about it. But he understands that the other issues that we have resolved in this important agreement are important and that we have worked hard in good faith to resolve it. And so his consultative process will go to work, and the United States will respect that process, as we should.

With respect to counterterrorism activities and the apprehension of an individual, we followed the normal procedures that the United States follows in our agreement. We regret that this circumstance took place in some ways that some folks apparently the chain of communication didn’t go as far. But we did what we are supposed to do under the agreement.

Now, I’m not going to discuss the details except to tell you that this individual is responsible for the loss of lives not just here in Afghanistan, but has plotted against the United States, has association with other major plots to injure many people, and is a serious terrorist. And so we will work with the government, as we have said. We will absolutely work with the Government of Afghanistan to cooperate so that the appropriate process flows out of this, to respect their interests and respect their sovereignty. But this was a normal counterterrorism procedure, according to the standards that we have been operating by for a long period of time.

PRESIDENT KARZAI: Ma’am, as I said in my introductory remarks, the whole document will go before the Afghan Loya Jirga for their consideration and consultation. And if it is approved, it will go to the Afghan parliament for the formal approval of state – relevant state institutions.

The issue of jurisdiction is one such issue that is beyond the authority of the Afghan Government, and it is only and entirely up to the Afghan people to decide upon through two mechanisms: One is the traditional Loya Jirga of Afghanistan; the second is the constitutional mechanism, which is the Afghan parliament.

On the issue of seizing a Taliban commander by the U.S. Forces Afghanistan, this is an issue that we have raised in earnest with the United States in the past few days, as we have on other previous occasions of such arrests in which the Afghan laws were disregarded, which we do consider a violation of Afghan sovereignty. And therefore, our discussion today in particular has been focused on making sure that through the Bilateral Security Agreement we make sure that such violations are not repeated. This is an issue of extreme importance to the Afghan people, and it is an issue that the Afghan people will demand in very clear, vivid manifestation from their government to make sure is ours – meaning sovereignty.

QUESTION: (Via interpreter) Thank you, Mr. President. We welcome Secretary of State Mr. John Kerry to Afghanistan. And my question is specifically for Your Excellency. As you had serious discussion during the past two days with your U.S. counterpart, can you assure the Afghan people that after this agreement is signed, the United States will not conduct operations by themselves and they will consider Afghan people’s sovereignty?

And how – what – how you came up with the definition of sovereignty? And also, that there is insurgency that (inaudible) Afghanistan, how do you define that? The third issue is, the Russian Foreign Minister Sergey (inaudible) stated that some specific terrorist group received training in Afghanistan, in terms of using chemical weapon. What do you think? What’s your position on this?

PRESIDENT KARZAI: (Via interpreter) With regards to the security and safety of the Afghan people and the security of the Afghan people, as well as the honor of the Afghan people and their families, and as well as full sovereignty, both the Afghan people as well as their homes, we are aware that it’s been years that we have been discussing this with our NATO and ISAF counterpart on this particular issue, the life of the Afghan people and the security of the Afghan people, and making sure that the house of the Afghan people are not searched under the name of fight against terror or not attacked under the name of the fighting against terror.

Civilian casualty in Afghanistan is one of the top priority of the Afghan Government, and it’s been our top priority and we try to address this so that the Afghan people can no longer suffer, not yesterday, not today, since the start of negotiation about Strategic Partnership Agreement with the U.S. Government, and after we signed the Strategic Partnership Agreement with the United States, I stated discussing security agreement with the United States. We have been raising our concerns with our counterparts.

Afghan sovereignty, the security of the Afghan people, and the safety of the Afghan homes, as well as respecting Afghan people’s honor and culture, and the clear definition of terror, are the issues we have been discussing during the past two days with His Excellency the Secretary of State. And we had long and deep discussions about these issues. And I am very happy, and I can tell you that we received some guarantees and we have written guarantees especially about the definition of invasion or attack. And we will, later on, share this with our media. I don’t know whether we can share this with you before Jirga or not, but we will definitely share it with you.

With regards to whether these guarantees will be implemented in practical or not, it is natural that the Afghan people (inaudible) and will move forward. Because we have a past, and we learn from our past. For the Afghan Government is going to seriously go forward, and will carefully go forward, and there is going to be no room for violation, including United States.

If they want to be partner with us, this partnership must completely guarantee sovereignty and security of Afghanistan. And we receive this through our document, but the rest will be up to the Afghan Government and our friends, and in order to build on this, based on mutual respect and friendship. And it’s for their interests, too.

Mr. Lavrov, the Minister of Foreign Affairs of the Russian – he had some statements that Syrian extremist groups – or in part of Afghanistan that are out of control of the Afghan Government, and they received training chemical – how to use chemical weapon. And this is against Afghanistan, and this is against our well-being. The Afghan Government will take action against this, and our ally – we will also have some questions for our allies who are here with us so that we can find answers for these concerns.

They have to leave, and we are also leaving. We will have more discussions tomorrow. His Excellency the Secretary has to leave because he has been for the past two days. You have important questions, but we will meet next time.

SECRETARY KERRY: I have to get on the plane. And I apologize because we would like to stay longer. I just want to say that I agree with what the President said with respect to sovereignty. We will work at that because we believe we have defined in this agreement. And we’re feeling very positive and excited about the possibilities from this agreement.

Final comment, Mr. President: Tonight, the Boston Red Sox – do you know who they are?

PRESIDENT KARZAI: Yes.

SECRETARY KERRY: It’s a baseball team.

PRESIDENT KARZAI: It’s a baseball team.

SECRETARY KERRY: They’re going to play for the American League Championship in Boston, and we want some of your cricket and soccer team luck to go with me, okay?

PRESIDENT KARZAI: Wish you all the best of luck there.

SECRETARY KERRY: No, wish them, the Boston Red Sox.

PRESIDENT KARZAI: Well, they’re your team, I believe. (Laughter.)

SECRETARY KERRY: My team. (Laughter.) Thank you.

SECRETARY OF STATE KERRY MEETS WITH MISSION STAFF IN AFGHANISTAN

FROM:  U.S. STATE DEPARTMENT 
Meeting With Mission Afghanistan Staff
Remarks
John Kerry
Secretary of State
Kabul, Afghanistan
October 12, 2013

AMBASSADOR CUNNINGHAM: I apologize for keeping you waiting. It’s been a very long and eventful day, and it’s not over yet for us, but it’s been very successful so far. And Secretary Kerry, I really want to thank you on behalf of all of us here, not just for coming to see us again, but for leading such a productive period here in our discussions with the Afghans.

I’m not going to introduce the Secretary, except to say that – how proud we are to welcome him here, and to say what a pleasure it is to have him come and meet with all of you. And what I can promise you is an extremely grueling day, but he very much wanted to do this.

So without further ado, Mr. Secretary.

SECRETARY KERRY: Thank you, sir. (Applause.) Thank you. Thank you very much. Well, hello, Embassy Kabul. Nice to be here. Great to be here, great to be here. In fact, I am having such a good time, I just decided to stay all – (laughter) – why would I ever want to leave? (Laughter.) We’ve had a terrific day, a very long – very, very long day; long night last night too. And it’s going to be a little bit longer even this evening. We’re going to go back to the palace and enjoy a dinner, again, with the President and his crew, but more importantly, we’re going to try to see if we can make a little more progress, which is what we’ve been doing all day long.

So I am very, very blessed to be part of an extraordinary team out here. First of all, Jim Cunningham and Leslie, I got to know them a little bit when they were in Israel. My wife Teresa and I went out, we had dinner with them there, and now I’m having dinner with them here. So we just dine all around the world, folks, wherever he is. (Laughter.)

But Jim, thank you for your outstanding leadership out here, and likewise Mike McKinley and the gang, and Fatima, and all of you who are part of an extraordinary team out here. About a thousand or 1,100 strong I guess, and almost a thousand local folks working with us. How many are there? A bunch – any locals here, raising your hands? Raise – we want to say a special thank you to you, all of you who are so important. Thank you very, very much. (Applause.)

We really couldn’t possibly do what we try to do without your help, and so we’re extraordinarily grateful. And I know it’s not easy. So we thank you for the extra commitment, in a sense, that it takes to go through the barricades, walk through the process, come in here, be affiliated with this great endeavor. It’s courageous and it’s significant. So we say thank you to you from everybody in America.

Likewise to all of you who are a part of that 1,100 Americans who are stationed out here. This is one of those posts, obviously, that will be with you for a lifetime. And for some of you, it probably feels like it has been a lifetime. (Laughter.) And for a few of you, this is not your first tour here, and we recognize that.

What is happening here is one of the great challenges on the planet today that really represents part of the complexity of the world that we’re dealing with and of the new foreign policy that not just we face, but every country that is engaged with the world faces. I just came from several days in the Far East. I was at the APEC conference and the ASEAN conference and East Asia Conference. And I can’t tell you how amazing it is to sort of sit around an ASEAN table, for instance, and sitting to my right is – or left – the Prime Minister of Myanmar, and on another side the Prime Minister of Vietnam, and Prime Minister of Laos, and you run the list. Improbable as that picture might have been quite a few years ago, that’s the new norm. And they’re all talking about global engagement. And in many of these meetings, they’re all talking in English. That really struck me.

When we sat around – the leaders, because I represented President Obama at the summit in APEC – with a few exceptions, people chose to speak their native language, but even those who could have, didn’t. They chose to speak English. And leader after leader was speaking in what is sort of the new international language of diplomacy and of business, of culture, of a lot of other things.

But what struck me that I think is important to your mission here and what you’re engaged in is the fact that they were, all of them, talking about stability and peace and trade and development, and the needs to meet the demands of their people, and how they see a new connectedness that is creating a new accountability in public life. There’s a new cop on the beat. It’s called the social network, the internet. Literally, a leader – I guess half a leader anyway – China – was viewed – a picture, and they saw this white spot on his arm in the picture where sort of a watch had been, and clickety-click, people said, “Well, that’s very strange.” And they went back and looked at other pictures, and they saw him with a bunch of different watches over a successive period of time. He’s a guy who couldn’t possibly have earned each of those watches. And lo and behold, they uncovered corruption.

That’s the kind of internet connection that we face today. You can’t beat up people in the streets without people seeing it all over the world. And that new connectedness is going to change everything – foreign policy, politics, all of the things we’re engaged in. You know that and you feel it.

Here in Afghanistan, you’re on the cutting edge of everything. You’ve been part of taking the country, which not so long ago had very few girls in school, and not that many boys, and now it has 8 million children in school, 40 percent of whom are girls. A country where you had about 9 percent or something who had access to health care; now it’s 60 percent have access to health care. A country where the life expectancy has grown by 20 years in the past 10 years, where you have an extraordinary amount of opportunity that didn’t exist previously. It’s mind-boggling what has gone on. And you are at the heart and center of how that has been able to happen.

Now we’re on the cusp of something new, and what the Ambassador and General Dunford and I and others have been negotiating over the course of the last day and a half is to guarantee that we can define that something new in the most confident terms possible, so that we know that your work here is going to be possible in an environment that can get safer, in a place where Afghans have confidence there’ll be a partnership with the United States and the rest of the international community that have been here, where we understand the rules of the road, and we’re giving our work the best opportunity to flourish into an Afghanistan that’s independent, that’s proud, that has respect, and that has the ability to have a fighting chance to define its own future for itself.

I think that because of that, if this thing can come together, this will put the Taliban on their heels, this will send a message to the community of nations that Afghans’ future is being defined in a way that is achievable, and all of your work will have a greater meaning than it does anyway.

So I just want to say thank you to you. This is on the cutting edge of diplomacy, right here. This is the toughest – one of the toughest places you could be anywhere in the world today. So I thank you profoundly. I want to have a chance to say hello a little bit and move around. But I cannot thank you enough for being part of this really extraordinary team. And obviously, it’s not without its risks. Last time I was here, a young woman, and you know her – Anne Smeddinghoff. Some of you knew her personally. Some have rotated out. She was my control officer during that visit and she died about a week later, trying to deliver books to help people be able to read. In Herat, we just lost local folks. No difference; all the same commitment, all the same action. And there have been a lot of others over the course of time who have put their lives at risk out here in order to make things better.

So this is the proudest tradition in the world, what you are engaged in. You can get up every morning and feel like your work is the most rewarding in the world, because you are touching those kids who are in school, those women who have businesses, the health care – all of those things that are happening, you’re a part of that. It doesn’t get better than that.

So on behalf of President Obama, the American people, thanks for putting up with the hardship of a yearlong out here, and those on second tour, for second-touring it. And we will welcome – and I promise you that those of us in Washington, when the government opens up again, we’ll get you all the money in the world, get you paid. (Laughter.) We’ll keep fighting. Don’t despair. Hope you ordered your turkeys. Have a great Thanksgiving and God bless you all. Thank you. (Applause.)

S.D. NATIONAL GUARD HELPS AFTER EARLY WINTER STORM HITS

South Dakota National Guard soldiers assist an electrical crew with setting a utility pole near Faith, S.D., Oct. 10, 2013. Army National Guard photo 

FROM:  U.S. DEFENSE DEPARTMENT 
South Dakota National Guard Continues Storm Aid
South Dakota National Guard

RAPID CITY, S.D., Oct. 11, 2013 - South Dakota National Guard members continue to support the state after the Oct. 4 winter storm that crippled western South Dakota.
Nearly 50 soldiers and airmen have been called to state active duty to support residents since Oct. 5. They've helped to clear roads, remove snow and assist electrical cooperative crews with gaining access to locations needing power lines repaired.
More than a dozen other full-time National Guard members have also provided support to state active-duty personnel in response to the storm. So far, 19 separate missions have been requested of the Guard since operations began.

Eight missions are complete and the Guard expects to continue to assist electric companies in power restoration efforts for the next seven to 10 days.

Guard forces and equipment began responding immediately after the blizzard and sent to locations hardest hit in Harding, Meade, Perkins and Pennington counties. Equipped with snow blowers, front-end loaders, bulldozers, heavy expanded mobility tactical trucks and Humvees, Guard members were dispatched locally and from across the state to help communities dig out from the record-breaking storm.

"Our soldiers and airmen are proud to be able to respond to local emergencies such as this," said Maj. Gen. Tim Reisch, adjutant general of the SDNG. "Our service in a state active-duty status like this is foundational to what the National Guard is all about."

Across the region, snow totals averaged 30 inches, with some isolated areas recording almost five feet, setting new snowfall records for October in the Black Hills and many western counties. Snow accumulation, along with freezing temperatures and wind gusts up to 70 mph, downed thousands of tree limbs and electrical power lines, blocked roadways and decimated livestock caught in the storm.

Emergency management officials from multiple counties requested support from the state's emergency management office and the governor, who declared a state of emergency and activated National Guard forces to assist.

The call for Guard assistance came early Oct. 5 and coordination began immediately to bring in personnel and dig out equipment. With roads nearly impassable and no travel advised, several soldiers trekked on foot several miles to reach the Guard headquarters on Camp Rapid in Rapid City to set up operations. Soldiers also trudged through deep snow in the towns of Belle Fourche and Sturgis to begin opening equipment yards. From across the state, Guard personnel from units in Aberdeen, Mobridge, Sioux Falls and Yankton were dispatched to deliver equipment and to assist recovery efforts.

According to local power companies, more than 38,000 customers lost electricity during the storm and reported more than 3,800 downed power poles.

While snow removal missions are complete, the Guard continues to support power crews who are working from house to house to restore electricity in rural areas, working alongside them pulling electrical bucket trucks out of the snow and mud after they work on a utility pole.

Guard units providing state active duty personnel to the storm recovery efforts include Alpha and Bravo Batteries of the 1-147th Field Artillery Battalion, 109th Regional Support Group, 842nd Engineer Company, 200th Engineer Company, 155th Engineer Company, Joint Force Headquarters and the 114th Fighter Wing.

SECRETARY OF STATE KERRY VISITS EMBASSY IN KUALA LUMPUR

FROM:  U.S. STATE DEPARTMENT 
Meeting With Staff and Families of Embassy Kuala Lumpur
Remarks
John Kerry
Secretary of State
Joseph Y. Yun
U.S. Ambassador to Malaysia
Kuala Lumpur, Malaysia
October 10, 2013

AMBASSADOR YUN: Thank you, guys, for being here. I am so fortunate. Many, many ambassadors don’t get a chance to introduce the Secretary, but in my first four weeks, (inaudible). (Laughter.) I’ve traveled with the Secretary a couple of times. I know how tiring it is. He is so gracious and charming, and he looks great, fresh. (Laughter.)

So this is our Embassy. Thank you, for everyone, on a wet night for being – for giving us such a warm welcome to the Secretary.

SECRETARY KERRY: Thank you. Thank you. Joe, thank you very, very much. Thank you, all. It’s great to be here with you. You have, I’ve got to tell you, a great ambassador in Joe Yun. I cannot (inaudible). (Applause.) They had to twist my arm for me to give him up in the State Department to let him come out here, but I’m glad he is, and he was very, very diplomatic in his introduction of me, because he took great pleasure in introducing me, but the truth is I know he’s really sad he’s not introducing the President of the United States. (Laughter.)

But nevertheless, I’m happy that he is introducing me. I’m very, very pleased to be here with all of you. Thank you for taking time to come out here. I want to introduce Dr. Melanie Billings-Yun, who is here somewhere.

AMBASSADOR YUN: She couldn’t be here. She --

SECRETARY KERRY: Oh, she couldn’t be here?

AMBASSADOR YUN: Yeah.

SECRETARY KERRY: She’s being a doctor somewhere. (Laughter.) What can I say? Well, somebody – anyway, Lee, thanks for your great work, appreciate all you’re doing as DCM, and thank you, all of you. I understand we have five employees here who each have spent something like 35 years. I don't know if they’re all here.

AMBASSADOR YUN: I think some of them are here.

SECRETARY KERRY: Have we got – let me see, I wrote them down so that I could embarrass them appropriately. (Laughter.) Gerard George, is Gerard here? Gerard, there’s Gerard. (Applause.) And Andrew Sin? Andrew here somewhere? Who else have we got? I can’t read my own writing. Oh, Letchu Alagirisamy?

QUESTION: No.

SECRETARY KERRY: No? Not here? Gosh. Okay. Selena Liew Kim Lan?

QUESTION: No.

SECRETARY KERRY: Not here also? How about Irene Tham Chee Lin?

QUESTION: Irene --

SECRETARY KERRY: Irene? Irene, we can all say – well, they’re all working for (inaudible). (Laughter.) Well, I’m glad they’re working hard, but between the five of them, they’ve put in 190 years in helping our Embassy and the United States of America. And even though only one of them is here, how about a round of applause for all of them. (Applause.) Thank you. They’re fantastic, pretty amazing.

And is Matt Ingeneri here?

AMBASSADOR YUN: He’s with Froman.

SECRETARY KERRY: Oh, he’s with Froman, all right. Well, I want to just congratulate him for all the work he has done on this global summit, which is absolutely incredible, and I look forward to addressing it tomorrow, but – everybody’s out working. I mean, Christ. (Laughter.)

Anyway, thank you all. I really just wanted to be able to meet you and, first of all, tell you that the President is obviously not happy that he is not able to be out here doing the business that he needed to do over the course of the last few days. And while I’m proud to be here as the Secretary, the Secretary, as we all know, is not the President and doesn’t have the ability that – the meaning, obviously, of a presidential visit.

So the President will get out here. I’m actually confident of that. But I know he sends his best wishes to every single one of you, but also his apologies for what is going on in Washington, (inaudible) from all of us. I spent 28-plus years in the United States Senate, and it is really painful, sad, to watch what is happening – I should say not happening – right now. But it’s affecting all of you; it affects everybody – the uncertainties, the disruption, the question marks about our country and our government. Believe me, I’ve had some conversations in the last few days out here with leaders about it. It’s impossible – for the Government of the United States of America to be shut down when there are people out here – not to say, “Question mark, what’s going on here? What does this mean and what does the long term mean?” And so my hope is this will end quickly. I know you hope the same thing.

I want to thank you for hanging in, staying at it, not being deterred, not being demoralized, and for recognizing that all of us got into this because we care about the values and the principles that we’re trying to share with the world, and that doesn’t change because of what is happening in Washington. So we’re on the same mission, and we can hold our heads high and be proud that every single one of us are out there trying the best we can to represent our country and to stand up and advance our interests. That’s what this is all about.

Every single one of you is an ambassador. I know we have about 118 or so local staff. How many of you are local staff who – thank you, all of you, very, very much. (Applause.) There’s no way for us to do what we do here or to try to do what we do without your help and support, and I know that sometimes it can be difficult. And we appreciate enormously the fact that you’re committed to this task, and some of you for, as I say, as many as 35 years, which is quite extraordinary.

And for all the rest of you, the hundred and, I guess, 20 or so – 118 or so who are in the Embassy and the some 75 families represented here, many of you sitting right here, I really am happy to say, on behalf of your country, on behalf of the President of the United States, a profound thank you to all of you for what you’re doing. Every one of you may not be walking around yet. Some of you newer people are either in the consular division or in your first or second round. You don’t get the title of ambassador, but there isn’t one of you who isn’t an ambassador every day. And for a lot of people, you may be the first person they ever see that has contact with America, in some cases maybe the only person, but in other cases, you’ll go – they may go on through travel or through one of our education exchange programs or through other things to go to America, or to be in some other country where they have a sense of what they learned by being part of our journey. And it makes a difference in their lives too.

So this is a big deal. This part of the world is changing faster than any other place on the face of this planet. You are part of an extraordinary moment of history. When you think of the journey of this region over the last 20, 30, 40, 50 years, and you go back to the Cold War, and even World War II, where we find ourselves today in this region is stunning. And I’ll tell you, as I sat around that table, listening to the Prime Minister of Vietnam, to the Prime Minister of Laos, to the prime minister of any number of them – of Singapore, of Malaysia, and all these places expressing this commonality of interests, every single one of them feeling the sense of globalization and change and the impact on their governments.

I was talking with the prime – well, I won’t say because it’s not appropriate, it’s a personal conversation – but I just was talking with one prime minister at lunch today who was telling me how it can’t – nobody can go back. There’s too much accountability now. The social media has changed everything. Instant accountability and globalization itself has created a set of norms that’s conditioning behavior, and so everybody’s sort of now reaching for the brass ring. That’s why things like the TPP, the trade agreement, and other things are raising standards and people realize, “Whoa, we better be part of that if we’re going to be successful and continue to go down this road of growth and development, and provide for our citizens.” And the beauty of it is citizens everywhere know what citizens everywhere else are getting, and they know what their problems are, and they know what the challenges are. So we’re now on a much smaller planet with a much greater degree of shared responsibility and shared opportunity, and you all are on the cutting edge of that, making history literally every single day in this transformation that is taking place.

So keep it up, don’t worry. We will get through this in America. We will get back on track. This will end. You will get paid. Things will happen and you’ll enjoy the turkeys I hope you ordered for Thanksgiving, and life will go on, and we’re going to continue to do what we do, because I think that we’re involved in one of the greatest adventures you can ever be involved in. You get up every morning and go to work with the belief that you’re really making a difference for the lives of other people and making a difference for your country. It doesn’t get better than that.

So, thank you all very, very much. (Applause.)

UN SECRETARY GENERAL COMMENTS ON PROGRESS IN AFGHANISTAN

FROM:  U.S. DEFENSE DEPARTMENT 
Rasmussen: Progress in Afghanistan Remarkable, Undeniable
By Donna Miles
American Forces Press Service

WASHINGTON, Oct. 10, 2013 - The partial government shutdown has not affected U.S. contributions to the International Security Assistance Force in Afghanistan or other NATO missions, NATO Secretary General Anders Fogh Rasmussen told reporters in Brussels today.

"So far we haven't seen any negative impact on U.S. contributions to NATO-led operations," Rasmussen said, noting that U.S. military members have been exempted from the shutdown.

Speaking at his monthly news conference, the secretary general also dismissed reported allegations by Afghan President Hamid Karzai that NATO hasn't done enough in Afghanistan.

"Thanks to the immense efforts and the solemn sacrifices of the troops and civilians from ISAF contributing nations, Afghanistan has come a long way in the past decade," Rasmussen said. "The changes have been remarkable, and our investment in lives and resources has been unprecedented. Nobody can deny that. And this effort should be respected."

Rasmussen said he is struck by the Afghan people's recognition of NATO's contribution.

"We have sacrificed much in blood and treasure to assist the Afghan people, and ... whenever I meet Afghans, they express appreciation for that," he said.

While working to ensure the sovereignty of the Afghan state, NATO and other troop-contributing nations in Afghanistan have helped build a strong Afghan National Security Force that now numbers about 350,000, Rasmussen said.

"We have seen the resilience and the growing professionalism of Afghan forces," he said. "And I am confident that the Afghan security forces will be able to take full responsibility by the end of 2014 as planned."

Meanwhile, Afghanistan is preparing to hold elections next year that will be fully led and managed by the Afghans.

"Six months before the polls, preparations are more advanced than for any other elections in Afghanistan's modern history," Rasmussen said.

The registration of candidates was recently completed, with a multi-ethnic lineup of presidential tickets, he said. In addition, women are actively participating as voters, election workers and candidates -- with at least one woman vying for office in every provincial council.

Rasmussen emphasized the importance of "transparent, inclusive and credible" elections, with the results acceptable to the Afghan people so "the political process provides the certainty and predictability that both Afghans and the international community expect."

He welcomed Great Britain's offer to host the 2014 NATO Summit at a turning point for the alliance as it prepares to complete the longest and largest operation in its history.

"This will be a critical opportunity to take stock of our ongoing work, including in Afghanistan, and to look to the future," he said.

"The summit will also ensure that we continue to build on the lessons that we have learned, to strengthen the alliance and keep it ready to deal with modern security challenges," Rasmussen said.

"It will reaffirm the vital transatlantic bond on which NATO was founded," he added. "And it will further enhance our partnerships, which are key to our future success in a world where risks cross borders and we are all interconnected."