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Assistant Secretary Nuland Testifies Before the Senate Foreign Relations Committee

Assistant Secretary Nuland Testifies Before the Senate Foreign Relations Committee

Thank you, Chairman Murphy, Ranking Member
Johnson, and the distinguished members of the Senate Foreign Relations Committee. It
is my honor to appear before you today to discuss the EU’s upcoming Eastern Partnership
Summit and highlight the opportunities and challenges we face in this part of Europe.
While the six Eastern Partnership countries have responded in various ways to the EU’s
offer to integrate into Europe’s common structures, the United States strongly supports the process
as a key ingredient in our effort to cement a “Europe whole and free and at peace” – a
shared policy goal of the United States and EU member states since the Berlin Wall fell
almost 25 years ago. At the November 28-29 Summit in Vilnius, EU
Members will make decisions whether to sign an Association Agreement (AA) and a Deep and
Comprehensive Free Trade Area Agreement (DCFTA) with Ukraine, and whether to initial these
agreements with Moldova and Georgia. This is a historic moment for all three of these
countries, and a key step toward their dream of one day being fully integrated into Europe.
All three have worked hard to bring their judicial and law enforcement structures closer
to EU standards and to prepare their political systems and economic and energy markets for
greater integration with Europe. Ukraine has passed over eighteen pieces of implementing
legislation harmonizing with EU standards to prepare for Vilnius. Georgia and Moldova
have met the requirements for initialing their Association Agreements, completed their respective
DCFTA negotiations and embarked on key judicial sector reforms. In each case, these reforms
have required a national political consensus that these countries’ futures lie with Europe. The United States supports the sovereign right
of these countries to choose their own future, and we welcome their closer relationship with
the EU. We have been working in lock-step with our European Allies and partners to help
Ukraine, Moldova and Georgia meet the tough conditions for a “yes” vote at Vilnius. We’ve
also been aligning future U.S. assistance with that of the EU to ensure that these countries
can continue on the politically difficult, but necessary, path of reform and economic
adjustment, including after Vilnius. At the same time, we have been working with the EU
and each candidate country to anticipate and prepare them for any negative reaction to
their choice, whether it comes from inside or outside their countries. I would note in
this regard that any form of pressure to prevent sovereign states from pursuing greater integration
with the EU, or any organization of their choosing, would contravene obligations under
the OSCE Helsinki Principles and the Charter of Paris. The message we are sending in the
neighborhood is that all countries benefit when their neighbors open their markets and
become more stable and prosperous. The breadth and depth of U.S. assistance to
the Eastern Partnership countries over the past 25 years is well known to the Senate
and to this Committee. You have been indispensible partners in shaping our policies and programs
in support of a more democratic and prosperous Europe and Eurasia. From the Freedom Support
Act to the Partnership for Peace, the members of this committee have been critical players
in providing the support these nations have enjoyed from the United States. This committee
has also participated in our dialogue with our EU partners on the importance of keeping
the door open to the European and transatlantic aspirations and identities of these emerging
and sometimes vulnerable states. We ask for your continued strong support. In recent months, as Vilnius approaches, we
have kicked our political, economic and technical assistance into high gear. The President gave
vital political support to the Eastern Partnership project during the Baltic Summit in Washington
in late August, and again when he met with his Nordic colleagues in Stockholm in September.
The Vice President has discussed developments in Eastern Partnership countries repeatedly
in his bilateral meetings with European leaders. Secretary Kerry underscored the strategic
importance of the Eastern Partnership when he met with all the EU Foreign Ministers in
Vilnius in August. At the annual Transatlantic Dinner in New York in September, Secretary
Kerry again focused his comments on the Eastern Partnership, and urged his European counterparts
to make bold decisions at Vilnius. In the months since, our interagency team
on Europe has worked with all parties to build consensus for the most forward leaning outcome
in Vilnius. We’ve met with decision-makers in all the candidate countries to drive home
the need to make tough choices and lock in real reforms before Vilnius and to show they
are serious about their commitments. We’ve also been in and out of Brussels and key EU
capitals on a weekly basis to coordinate our efforts, and fine-tune our assistance programs
to ensure they are effectively coordinated with EU programs and supportive of the countries
involved. Now, let me turn to the prospects for each
of the EaP countries, their challenges and our support. Ukraine still needs to take three important
reform steps to meet the EU’s conditions for signature at Vilnius including: passage of
legislation reforming its Prosecutor General’s Office; passage of legislation reforming its
parliamentary election code; and the release of jailed former Prime Minister Yuliya Tymoshenko
for medical treatment. Since its independence in 1991, the American people have supported
Ukraine’s transition to democracy and a free market economy with over $5 billion in assistance.
In FY2013, our assistance topped $100 million, and much of it went to help Ukraine meet European
standards in law enforcement, electoral reform, business climate and the judicial sector,
including key support for Ukraine’s newly adopted Criminal Procedure Code. If Ukraine
meets the EU’s conditions and signs in Vilnius, it will be able to export its goods to the
largest single market in the world, tariff-free, by early 2014. This should provide a great
stimulus to an economy which has been in a difficult recession for over a year. In the
past few months, Ukraine has come under pressure from Russia, including bans on chocolate,
stoppage of refrigerated goods at the border, and reductions in other key imports. We are
working with the EU on options to help Ukraine make difficult trade adjustments and weather
the EU implementation period if Ukraine makes the political decisions necessary to sign
its AA at Vilnius. Moldova’s initialing of an Association Agreement
at the Vilnius Summit has already been approved by the EU, and it is poised to attain visa
liberalization from the EU this spring and sign by September 2014. The United States
has provided over $1.1 billion in assistance since Moldova’s independence in 1991, with
approximately $22 million in FY 2013 dedicated towards improving governance, combating corruption,
increasing transparency and accountability, strengthening the rule of law and the NGO
sector, reducing bureaucratic barriers to trade, and improving the business environment.
The five-year, $262 million dollar Millennium Challenge Compact with Moldova, launched in
2010, supports Moldova’s economy by rehabilitating roads and irrigation systems, and providing
technical assistance and access to finance to Moldovan farmers and agribusinesses. Many
of these programs are directly aligned with the reforms needed for Moldova to initial
the Association Agreement in November. Recent Russian actions against the import of Moldova’s
wine and other agricultural exports have a disproportionate impact on its small economy,
and could potentially expand into other sectors as the country deepens its EU integration.
We are exploring ways we can help mitigate vulnerabilities including by increasing Moldova’s
energy independence and promoting trade with the EU and the United States. In 2012 and 2013, Georgia took important steps
forward with truly competitive national elections, resulting in the first peaceful, democratic
transfers of power since it regained independence; but considerable political and economic challenges
remain, such as the unresolved conflicts in the two Russian-occupied regions of Georgia;
protracted displacement of people; fragile democratic institutions, the need for further
strengthening of the rule of law, and an economy that requires additional focus. In recent
years, Georgia has received $1 billion in post-conflict funds, a second Millennium Challenge
Corporation (MCC) compact, and it is one of the largest annual U.S. bilateral assistance
budgets in the region. The United States is concentrating efforts on democratic institution-building,
and the use of innovation, both economic and technological, as a way to build institutional
and human capacity that further strengthens Georgia’s push towards Euro-Atlantic integration.
We have also joined the EU and NATO in protesting new fences and physical barriers that Russian
security forces have built along the Administrative Boundary Lines of the occupied territories
in Georgia; this is inconsistent with Russia’s international commitments and Georgia’s sovereignty
and territorial integrity within its internationally recognized borders. With U.S. assistance,
Georgia has reoriented its trade towards Western markets and increased its energy efficiency
and diversity, and we are working with the EU to strengthen Georgia’s ability to resist
external pressure. On September 3, Armenian President Serzh Sargsian
announced that Armenia would join the Eurasian Customs Union of Russia, Kazakhstan, and Belarus,
which is incompatible with signing an Association Agreement and a DCFTA. However, both the EU
and Armenia remain committed to pursuing a deeper relationship, and they are examining
ways to continue this partnership. The United States will also continue broad engagement
with Armenia on Euro-Atlantic integration, including in the economic sphere. Azerbaijan is currently negotiating the contours
of its own partnership track with the EU, and the United States continues to encourage
Azerbaijan to build the democratic and economic institutions and conduct the reforms necessary
for a deeper relationship with the Euro-Atlantic community. We recognize that a democratic,
prosperous and secure Azerbaijan will benefit not only the Azerbaijani people but also its
neighbors. Belarus has not pursued any agreements within
the Eastern Partnership and is a founding member of the Eurasian Customs Union with
Russia and Kazakhstan. Nonetheless, we have worked closely with the EU to promote the
emergence of a democratic and prosperous society in Belarus that shares common values, norms
and standards with the United States and Europe. The United States will continue to provide
assistance that promotes the open expression of political views, supports civil society,
and promotes media freedom. Finally, in our discussions with Russia about
the Eastern Partnership, we are encouraging Moscow to abide by its commitments in the
OSCE and elsewhere regarding sovereign neighbors’ rights to pursue any political and economic
arrangements they choose. We have also encouraged Moscow to see the benefits of deeper integration
between its neighbors’ economies and the EU’s 500 million consumers, as well as the significant
prospects for economic reform and sustainable growth that integration will bring to these
countries. For one thing, more prosperous neighbors will buy more Russian exports. Both
the EU and the United States are interested in increasing trade with Russia, and we are
open to further consultations on what might be possible. The Eastern Partnership is, ultimately, about
far more than a closer relationship between the EU and several countries in Eastern Europe
and the Caucasus. It is also a step toward the longstanding vision of a more integrated
economic space, stretching from Lisbon to Donetsk animated by market-oriented reforms,
growing prosperity and deepening democracy. To this end, the EU and the United States
are negotiating the Transatlantic Trade and Investment Partnership — which promises to
support growth, investment and jobs on both sides of the Atlantic as well as establish
a high-standards, rules-based global trading regime. That broader vision of Europe’s integrated
economic space is becoming increasingly real and attractive and could ultimately encompass
not only Europe, but the entire Transatlantic space. We and the EU believe that investing
in the Eastern Partnership is thus in everyone’s long-term interest. I look forward to answering your questions.

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