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National Archives

Public Papers - 1989

White House Fact Sheet on Proposed United States Assistance for Hungary and Poland

1989-07-12

Hungary has entered a period of dynamic political and economic change. President Bush announced several measures to support Hungary's already considerable efforts to develop private enterprise and a freer political system.

Concerted Western Action

for Hungary and Poland

Proposal

The President is proposing that nations of the Summit Seven intensify their concerted action to support economic reforms based on political pluralism in Hungary and Poland. Complementary efforts by leading industrial democracies will provide a powerful impetus to economic recovery and progress in these nations as they face a turning point. Other interested countries could contribute to this process as well.

Scope

Efforts will involve work with the Hungarian and Polish Governments and with other official and independent organizations in those countries to gather information and provide feedback on issues of mutual concern. Involved governments will also work, as appropriate, with representatives of the International Monetary Fund (IMF), World Bank, European Communities Commission, and other multilateral and private sector institutions.

Specific issues addressed could include:

Needed economic reforms;

Timing and conditions for new credits; and

Concrete support for privatization and private business, environmental projects, management and training initiatives, social safety nets to accompany restructuring, housing, etc.

These efforts would not undercut or replace existing institutions such as the World Bank, Paris Club, or IMF.

Next Steps

The President will discuss this proposal in Paris with the leaders of the other Summit Seven nations: the United Kingdom, the Federal Republic of Germany, France, Japan, Italy, and Canada.

Hungarian-American Enterprise Fund

Proposal

Hungary has taken a number of steps to enlarge its private sector which can produce wealth that will benefit the entire Nation. At the President's initiative, the United States and Hungary will jointly establish a Hungarian-American Enterprise Fund. The President is asking Congress to provide million for this initiative.

Purpose

The Fund will support the development of the growing private sector in Hungary. It will be empowered to disburse hard currency loans or venture capital grants for approved projects, including:

Private sector development (business loans/grants, possible establishment of a private sector development bank);

Privatization of state firms (e.g., provide funding for entrepreneurs to buy into state firms);

Technical assistance or training programs in support of or run by Hungary's private sector;

Funding of export projects partly or wholly private; and

Joint ventures between private Hungarian and American investors (e.g., encourage participation of private Hungarian firms in joint ventures).

Hungary: Most-Favored-Nation Status

Proposal

The President has announced that upon enactment of the new law on emigration by the Hungarian Parliament, he will inform the Congress that Hungary is in full compliance with the Jackson-Vanik amendment to the 1974 Trade Act. Hungary will be eligible to receive most-favored-nation (MFN) status for the maximum period allowable under our legislation, without any need of annual waivers.

A Regional Environmental Center

Located in Budapest

Proposal

The President has proposed the establishment of a million regional environmental center located in Budapest. This is a substantive followup to the President's initiative in Mainz to help Eastern and central Europe overcome its environmental problems.

Purpose

The center will provide a facility for cooperative research and activities between governmental and nongovernmental experts and public interest groups from the United States, Western Europe, and Eastern Europe concerned with the environment, including energy and nuclear safety.

Scope

The center would be an independent organization supported by both private and governmental funds. It would focus on developing the broadest human resource base for comprehensive environmental improvement and protection activities in the region.

The center would facilitate loans of lab equipment and organize workshops and other exchanges.

Specific emphasis would be placed on transboundary pollution problems, toxic waste disposal, alternative sources of nonpolluting energy, and promotion of nuclear safety technology and practices.

Although located in or near Budapest, the center's objective would be to attract funding and direct participation by both governmental and private entities and groups from East and West.

Exchanges With East-Central Europe

Proposal

The President has called for expanded and imaginative exchange initiatives. The U.S. Information Agency will allocate up to .1 million from 1990 resources in order to implement this new initiative to strengthen the trends toward democratic values and institutions through significantly expanded academic, cultural, and people-to-people contacts.

The principal emphasis of this initiative will be in Hungary and Poland, but other countries in the region will also be involved. Hundreds will participate in the new government-sponsored exchanges in both directions over the next year.

The initiative has the following elements:

Political, Social, and Legal Institutions

The John Marshall Study Program in the Rule of Law. Visits to the United States by more than 50 legal scholars, judicial and parliamentary officials to examine the U.S. jurisprudence and legislative system;

Visits by congressional experts to consult with new democratic legislatures in Hungary and Poland;

Consultations for representatives of East-Central European political parties with U.S. party organizations to learn the mechanics of democratic electoral politics;

Samuel Gompers Labor Leader Exchanges. Travel and study programs for trade unionists in the United States;

Translation and distribution of up to 100,000 books, magazines, and videocassettes in local languages on the U.S. political and economic system;

Placement of U.S. specialists in law and public administration at East-Central European academic institutions; and

Visits to the United States by East-Central European ``future leaders'' under the age of 30. Approximately 100 participants are projected for this program.

Free Market Initiative

Alexander Hamilton Fellowships in Management. Internships, educational and training programs for at least 50 entrepreneurs and enterprise managers.

Consulting visits by U.S. executives and management specialists to advise private and cooperative enterprises.

Support of management training programs and institutes through U.S. instructors, curriculum materials, and short-term seminars. Hundreds of East-Central European management specialists would benefit from this expanded effort.

Educational and Youth Exchange

Establishment of Noah Webster Chairs in American Language and Literature at central and Eastern European universities.

Citizen Exchange Initiative. Assistance to the U.S. private sector in developing youth and other people-to-people exchange activities in Eastern and central Europe. Several hundred American and European citizens would be involved in this intensified two-way exchange initiative.

Environmental Protection and Cultural Preservation

Two-day exchanges with specialists in the fields of environmental protection and cultural preservation.

Science and Technology (S T)

Agreement With Hungary

Scope

The President has announced the U.S. intention to conclude an umbrella S T agreement with Hungary. We envision a broad program of scientific and technological cooperation in such areas of joint interest and expertise as basic sciences, the environment, agriculture, medicine, energy, geology, and nuclear safety.

Purpose

The agreement would develop and implement high-quality cooperative research programs.

S T cooperation recognizes Hungary's first-rate scientific establishment.

The agreement also complements the President's Eastern European environmental initiative by coordinating research activities, providing core funds, and encouraging contacts in the environmental area.

Next Steps

We expect to send a technical delegation to Hungary shortly to negotiate the final terms of the agreement and work out detailed arrangements for funding.

Funding

Annual contributions of approximately million or the equivalent in Hungarian currency from each side would implement the agreement.

The United States can expect reasonable and tangible returns that far exceed U.S. costs because such core money often returns much larger dividends in terms of scientific innovations and by stimulating additional funding by participating technical agencies.

This program will complement other existing and valuable U.S. S T programs with Poland and Yugoslavia.

United States Peace Corps/Hungary

The Program

The United States and the Government of Hungary have agreed in principle to establish a Peace Corps program centered on assisting Hungarian efforts to develop and expand English language teaching.

The Peace Corps entry into Hungary represents a new era for American volunteers serving overseas. The Hungarian program, which could begin as early as the fall of 1989 with training for assignment in early 1990, eventually will involve teaching English in Budapest and all 19 of the country's counties.

The Volunteers

There are now nearly 6,000 volunteers and trainees in 65 nations in the Americas, Africa, Asia, and the Pacific. Hungary will be the first European country where U.S. volunteers are assigned.

Around the world, these Peace Corps volunteers offer skills in a wide variety of programs (e.g., maternal and child health, family nutrition, freshwater fisheries, agriculture extension, teacher training, small business consulting, public administration, natural resource development, energy, engineering, and industrial arts).

A volunteer must be a U.S. citizen at least 18 years old. There is no upper age limit, and currently, nearly 500 volunteers are over 50.

Training

All volunteers will receive language and cultural training within Hungary before being assigned to schools. Strong emphasis will be placed on learning Hungarian. Cultural studies include Hungary's history, customs, and social and political systems.

Note: This is an excerpt of a White House fact sheet released by the Office of the Press Secretary.

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