Press Roundtable in Sao Paulo, Brazil

MS. HELLING: Good afternoon everyone, I am Lisa Helling. I am the Public Affairs Officer at the Consulate in San Paulo. I guess my first question is, can you hear over the air conditioning?

REPORTERS: Yes.

MS. HELLING: We will speak loudly.

REPORTERS: Yes. We will speak up.

MS. HELLING: It is my great pleasure to introduce a person who I suspect anybody who has covered the State Department over the years already knows, Under Secretary of State for Political Affairs at the State Department Nicholas Burns. I just want to set a few ground rules. I am sure nobody is surprised that not only are you on deadlines but so is the Under Secretary. So we have about 20 minutes altogether. So, what we would like to do is for the Under Secretary to have just a few opening remarks and we hope to give everybody the opportunity to ask a question. So, if you raise your hand then I will designate. But I am also the time police. So, our time period is about 20 minutes or so.

UNDER SECRETARY BURNS: Okay. Lisa, thank you. Good afternoon. Sorry to keep you waiting. I will not give a speech because I would much rather just get to your questions. But let me just say that we arrived in Brazil this morning. We had lunch with Governor Serra, a very good lunch. We talked about biofuels, talked about possible U.S.-Brazilian cooperation on crime, on counter-narcotics, terrorism, the kind of problems that are affecting both of us. We are going be seeing some more members of the business community tonight. Tomorrow we go to Brasilia and have a full range of meetings with the Brazilian government. I am accompanied by Tom Shannon, who, I think all of you know is our Assistant Secretary of State for the Western Hemisphere and Ambassador Cliff Sobel, who is a close personal friend and needs no introduction. So, that is our team. We also have the Secretary of State's Energy Adviser, Greg Manuel, with us as well as Bill McIlhenny, who is one of our Latin specialists with the State Department.

So, we are here. We are here until Thursday afternoon in Brazil. We are also meeting with a group of governors from some of the most important states on Thursday in Brasilia and then we are going to Argentina for 24 hours for meetings with the Argentine government. I just wanted to kind of frame the trip.

Just a word about how we view Brazil. Should I wait for all the --

REPORTER: (Unintelligible).

UNDER SECRETARY BURNS: Okay. We have, I think an extraordinarily broad agenda with the Brazilian government and between the American and Brazilian private sectors. We look at Brazil as, without any question, our most powerful partner in the hemisphere. I think the state of the relationship is very good, close relations between President Bush and President Lula. Very good, effective working relations between Foreign Minister Amorim and Secretary of State Condi Rice. I have had a strategic dialogue underway for about a year, what we call strategic dialogue, with Antonio Patriota, who has been my counterpart. We have consciously set that up to see if Brazil and the United States can cooperate on global issues as well as regional issues. So, we have got a very active dialogue in the U.S. He came to visit me last year. We met in New York in September. I am now paying a visit to him. And, of course, we are going to welcome him to Washington and to the United States fairly soon. So, I think across the board an excellent relationship.

Obviously not without its disagreements from time to time. Two very large, hemispheric countries that sometimes have different perspectives on issue, but for the most part, are able to find their way towards a consensus. I would just say we look at it in the following way; we look at Brazil as our most important partner in the hemisphere. So, in all the problems of the hemisphere and challenges from narcotics to crime to energy, biofuels, for instance, Brazil is a major partner.

In biofuels, this can become, in many ways, probably the symbolic centerpiece of a new, stronger U.S.-Brazilian partnership. We think we can have a stronger partnership with Brazil and we hope to have an agreement between the governments on biofuels this year, not 12 months but in the near future. We are working on that. We will not complete it on this visit but we will be talking about it tomorrow in Brasilia. I do not know if that is my echo or someone else's.

REPORTER: Okay.

UNDER SECRETARY BURNS: I will be happy to go into that if you want. We also have a global agenda with Brazil. On global climate change, on nonproliferation where we are really looking to Brazil to help lead on important issues concerning nonproliferation worldwide, Iran, North Korea. We have, I hope, common interests in trying to strengthen the United Nations now that Ban Ki-moon has taken over. In terms of UN peacekeeping, in terms of using the United Nations more frequently to try to help resolve some of these transnational issues that are at the heart, I think, of our diplomatic agenda now.

So, in all respects, we look around the world and we see strong regional partners. Japan and China and the Far East, Australia, India and Pakistan and South Asia, Nigeria and South Africa and Africa. Certainly Brazil, Argentina in this hemisphere. So, we are here to try to build that relationship and we do think it can be strengthened. I think tomorrow, you know, any issue you could think of is going to be on the agenda and they vary, I think we have six or seven meetings in the various meetings that we're going to have. So, let me just stop there. I am happy to answer any questions that you have.

REPORTER: (Unintelligible).

UNDER SECRETARY BURNS: Yes.

REPORTER: (Unintelligible)

UNDER SECRETARY BURNS: Yes. You know, I think that the environment for the better part of 30 years or so, has been an important issue for most Americans. Whether it is conservation of our national park lands or it is going to unleaded gas well before most of the rest of the world back in the 1970s. You heard our president in the State of the Union speech talk about global climate change. Now, we have spent about $29 billion - - we the United States government -- since 2001 on research and development of clean environmental technology since then. We have budgeted $6.5 billion in 2007 for continued research. There is a lot of initiative inside our government in the Energy Department but also in our private sector and in some of our states like California where Governor Schwarzenegger is leading an effort to reduce carbon emissions. There is now a big effort to see that the United States does what it must do as the largest economy in the world and as a very large emitter of greenhouse gases, to see if we can be part of a global solution to global climate change.

Now, you all know, we have not joined Kyoto. It was not ratified by the United States Senate. But we do have environmental agreements on climate change with a great number of countries. Of course, we have the Asia Pacific Partnership with China and India and Japan and South Korea and Australia. So, there can be an engagement, and there should be an engagement, between the United States and Brazil on global climate change. We are not going to agree on every recipe to fix the problem, but I think we can agree that there has to be an effort and that both of us, as major global economies, have to play a role in it. So, it is an interesting issue for us. I think it is evolving. There is a period ahead now we can cooperate and I think that was President Bush's message in his State of the Union Address. This is an issue that Americans have to participate in as well.

REPORTER: (Unintelligible).

UNDER SECRETARY BURNS: Yeah.

REPORTER: Could I ask you a question about Iran?

UNDER SECRETARY BURNS: Yes.

REPORTER: We hear that Iran is loaded up with (unintelligible) and there is quite a lot of (unintelligible). What is the U.S.' response to that? What does that say about Iran's intentions and will you be pushing for more resolutions with that in mind?

UNDER SECRETARY BURNS: Let us see what the Iranians do. We did listen carefully to Dr. Mohammad El Baradei when he was at Davos two weeks ago when he said he feared that the Iranians might go to 3,000 centrifuges, try to string them together in a cascade at their plant in Natanz. That would be a very unwise step by the Iranians. They are already isolated. You have this extraordinary situation where Russia and China and the EU3 and the United States have agreed on sanctions. The Council agreed now, they voted 15 to 0 on December 23, 2006. Those sanctions are now up for review on February 21, 2007. If Iran should make a move to go to 3,000 centrifuges, to continue to deny 38 IEA inspectors from even going into the plant, which is in violation of their agreement with the IEA, then Iran is going to just deepen its isolation. I think it will just convince the countries of the world to come together to send this one message, that they need to suspend their nuclear program and they need to accept the invitation that the P5 countries made on June 1, 2006 to negotiate.

We said that we would suspend the sanctions in the UN if Iran suspended its enrichment program. Secretary Rice said that she would negotiate, she would be the lead American negotiator with them. That offer is still on the table. So, we believe that diplomacy can succeed. We need to be patient. But the Iranians would be very unwise, and I think the rest of the world would be highly critical of them if they defied El Baradei, defied the UN Security Council and defied the IEA Board of Governors, which voted a year ago this week, and Brazil and Egypt and India voted with the United States, to give this one message to Iran, suspend your nuclear program, negotiate with the rest of us. So, that is how I would answer this fear that Iran may be on the verge of going to 3,000 centrifuges. Okay.

REPORTER: Just hoping to ask a little bit about the biofuels.

UNDER SECRETARY BURNS: Sure.

REPORTER: (Unintelligible). (Unintelligible) cooperation comes from that and do you see this as a regional project or (unintelligible)?

UNDER SECRETARY BURNS: I think that the biofuels issue holds enormous promise for the U.S.-Brazil relationship. We are the world leaders, Brazil and the United States. We have over 70 percent of the ethanol market together. We have done the most advanced research into biofuels production, both of our countries, our private sectors especially. I think there is a bilateral, regional and global nexus here, a connection for the U.S. and Brazil.

First, if our two societies and governments can come together on cooperation of biofuels, it can be the catalyst to produce a stronger U.S.-Brazil partnership and there is enormous promise there.

Second, we ought to want to involve other countries from the region, the U.S. and Brazil, in biofuels research and the biofuels market so that other countries can derive benefit from it and other Latin countries can become energy producers and get away from this addiction to oil that my country, and other countries in the hemisphere, unfortunately suffer from.

And third, it is clearly in our interest, Brazil's interests and the United States' interest, that we expand the global market for biofuels, particularly ethanol, and that it become a global commodity of sorts. That would mean, I think that would be tremendously advantageous for the Brazilian firms involved in biofuel. I can tell you it would be for the American producers of ethanol. When we go to Brasilia tomorrow, we will be discussing, with a wide variety of officials in many different departments of the Brazilian government, what we can do to reach an agreement fairly quickly between our two governments to move forward. What this means is, we would really be championing cooperation between our private sectors because it has been the Brazilian private sector and the American private sector that have led.

We had a very good discussion with Governor Serra today about this. He was very positive and we were pleased about that. We also had a briefing this morning from three leading Brazilian agronomists and agricultural engineers who are experts in biofuels, which I, for one - because I am not an expert on biofuels - found enormously useful. I told you that Greg Manuel is here. He is this gentleman to my left. Greg is Secretary Rice's Energy Advisor and he has taken the lead for us in working with the Brazilian government and some other governments on these biofuels initiatives.

REPORTER: Are you prepared to open the American ethanol market to a large (unintelligible)?

UNDER SECRETARY BURNS: Well, you know, I am just a humble Undersecretary of State. I am not a member of the Congress of the United States. In our system of government, Congress writes the laws and Congress has written the laws the way they have. Now, as long as both laws are on the books, it is the obligation of my government, and someone like me, to implement those laws. We will do so. But I do not think that should be an impediment to closer cooperation between Brazil and the United States both bilaterally, regionally, but also globally.

REPORTER: Could the government propose to change the laws?

UNDER SECRETARY BURNS: Excuse me?

REPORTER: Could the government propose to change the laws?

UNDER SECRETARY BURNS: Well, again, sticking with my theme of humility. It is the President and the Executive Branch who would propose changes and, you know, I think the President ought to be the one - he will need to make a decision. He will need to look at all the factors. But, for now, we have a law that the United States, of course, implements and I know that there is some unhappiness in Brazil about that. We heard from Governor Serra. We heard from some of the private experts this morning that they do not agree with us. But none of them said that it would prevent the kind of large-scale, great strategic leap forward that both societies should want to make in the field of biofuels.

The other reason that we should want to do this is because energy has become a distorting issue internationally of sorts. Energy has tended to distort the power of some of the states that we find to be negative in the world, Venezuela, Iran. So, the more we can diversify our energy sources and depend less on oil, the better off we are going to be. I am speaking from a U.S. perspective. I will let Brazilians speak for themselves.

But that is how we see it. And so, this is a very attractive area of cooperation and a very hopeful one. I think that a year from now you will see much greater cooperation between Brazil and the United States on biofuels than today.

REPORTER: First question is, are you working with Saudi Arabia to keep prices of oil lower than they were in the beginning of the year? And secondly, Mr. Shannon has been doing (unintelligible) but then when we see the Negraponte (unintelligible) he's much harder. I mean, (unintelligible).

UNDER SECRETARY BURNS: Aah, I see. Okay. Well, let me answer your first question, I will take a stab at your second, then I am going to let Ambassador Shannon defend himself.

REPORTER: Okay.

UNDER SECRETARY BURNS: On the first one, Saudi Arabia can speak for itself. It is the leading member of OPEC.

Obviously, it is in the interests of the United States - I can only speak for my government - to see a rational energy price level, and when energy prices fall it is generally good for American consumers.

In the case of Venezuela, I can just tell you, what I do in Washington, I am the Under Secretary of State for Political Affairs. I look at all regions of the world. So, I help to supervise our policy in Africa, Europe, Asia, Middle East. We do not obsess about Hugo Chavez.

Frankly, he is just not someone we think about very much. Our policy globally is meant to work with friends and partners. That is where we put the vast amount of our energy. If you look at, for instance, in this hemisphere, this extraordinary year of 2006, all of the elections, 13 elections. Also elections in my country, our mid-term elections. The overriding sentiment expressed by the diverse peoples, Mexicans, Peruvians, Chileans, Brazilians, Americans, was, you know, that people celebrated democracy. People celebrated trade and economic growth. People obviously are worried about social justice and poverty. We recognize that. We definitely recognize that and want to help speak to that.

But people also - our view is that people want to see a harmonious hemisphere, not a divided one. They want to see positive agendas from governments, not failed policies from the past. So, if Chavez wants to take his country in the direction of some of the failed policies of the past, that is his choice.

It is just not a very big factor for us because we prefer to work with Argentina, Brazil, Panama, Columbia, Mexico, Peru, Nicaragua, some of the other countries that we find to be heading in a more positive direction. But that is just my take. I would listen to Negroponte and Shannon. I find no contradiction between them.

ASSISTANT SECRETARY SHANNON: I like to think that also.

UNDER SECRETARY BURNS: We will tell Negroponte we agree with him.

ASSISTANT SECRETARY SHANNON: Ambassador Negroponte was published responding to questions in our Congress and expressing concerns that are well known in terms of how we view Venezuela, the events in Venezuela, and Venezuela's ambitions in the region. But what we've also been trying to do, underscored, is that in the hemisphere, our agenda is a positive agenda. It is about big issues. It is about engaging with like-minded countries on big issues like how do you fight poverty? How do you fight inequality? How do you fight social exclusion? By using any kind of economic tools and assistance tools that we have at our disposal, both in our bilateral relationship but also multi-laterally. And then, you know, in the process of this, what we are looking for are people who want to work with us. And what we have tried to make clear, in what some people call a more moderate approach, is that we believe that the harsh rhetoric that we hear from Caracas and the anti-Americans we hear from Caracas, is something that does not or should not reflect the relationship between Venezuela the United States.

In other words, historically, it has been a productive relationship with both countries. We still have an energy relationship that is vital to Venezuela and vital to the United States. We believe that if the Venezuelan government were to take the decision to do so, there are some concrete areas where we could work together. Whether it be fighting drugs, fighting terrorism or improving our energy relationship. But we just want to make it clear to everybody that this toned confrontation is not something that comes from us. It is a decision made in Caracas for reasons that are peculiar to Caracas, but that we are prepared to sit down and talk with them at the appropriate moment, recognizing at the same time, we have certain principles and concerns that we will talk about.

UNDER SECRETARY BURNS: Yes. It is not as if we do not have any contact. We have a very, very skilled career diplomat, Bill Brownfield, in Caracas. He is there. If the Venezuelans want to talk, he is there. From time to time we talk to the Venezuelan ambassador to the United States as well.

MS. HELLING: We have just a couple questions.

REPORTER: How close is the U.S. government working with governments here in the tri-border area on fighting terrorism? How important issue is that in the United States?

UNDER SECRETARY BURNS: Well, you know, terrorism is a very important issue to us. It has to be. We have been a victim of terrorism, obviously, as have many other countries. If you think of, you know, what are the greatest threats to global security? There is climate change, there is trafficking of women and children, there is international crime, international drug cartels, there is terrorism and its juxtaposition with chemical and biological and nuclear weapons.

So, we are focused on all of them. We are really focused on the last one to a very great extent in every region of the world. You know, we are cooperating, for instance, with Indonesia and the Philippines on this, with Russia, with China, with some of the countries of Africa. In the tri-border region, that is an important issue for us and we will discuss this tomorrow in Brasilia. We will certainly discuss it in Buenos Aires on Friday.

REPORTER: There is a close contact then.

UNDER SECRETARY BURNS: There is lots of discussion among our governments about this and there should be because, you know, all of us have the same problem. What defines terrorism? It is global in nature. It cannot be prevented by Brazil alone or the United States alone. We have got to have cooperation. So, it is definitely an issue on the agenda.

MS. HELLING: I think we have time for, well, maybe --

UNDER SECRETARY BURNS: We will try to go real fast.

MS. HELLING: Okay.

REPORTER: Okay. Getting back to the biofuels. I would like to know whether our (unintelligible). What are the concrete steps we can take? What kind of cooperation can start right now?

UNDER SECRETARY BURNS: With all due respect, I think there are many interests that countries have about biofuels. Of course, one would be access to this very large market called the United States, we understand that. But there is also the issue of what can we do in the region to give more countries the benefit of biofuels, of alternative energy schemes, to become producers themselves, which is an empowering thing. We Americans would like to broaden the net and we would like to cooperate with more countries and to create a regional web of cooperation on biofuels, number one.

Number two, Brazil has taken the lead in creating an international forum to discuss this issue. I think we share the same strategic objective with Brazil that if we can enlarge the global market demand for biofuels, it is going be good for the producers in both of our countries. It is going to also have a very positive environmental impact. So, it is in that area where, very specifically in terms of trying to make ethanol a commodity that can be global in orientation, we are very focused.

Finally, some of the leading scientific research is being done right here. In fact, we were briefed by some of these people this morning. Wwe also have this in our land-grant universities in our Mid-West. We ought to combine on research and development to make more efficient the production of biofuels.

So, those are three very concrete objectives and we are working in each of those areas with the Brazilian government. We will discuss each of them tomorrow. Greg Manuel is carrying on a very detailed, very specific set of talks with the Brazilian government on these issues.

ASSISTANT SECRETARY SHANNON: If I could add, in the conversations that we have had with these experts, the value they see in opening the U.S. market is not to promote Brazilian exports to the United States. They argue that Brazil is going to have trouble meeting its own internal demands and that the United States is going to have trouble meeting its own internal demands, especially as established by the President. Therefore, they see the value of the market opening in this process of internationalizing a commodity. In other words, promoting reduction elsewhere.

UNDER SECRETARY BURNS: Okay. What else?

MS. HELLING: Last question.

UNDER SECRETARY BURNS: Yes.

REPORTER: Do you see the establishment of an OPEC for ethanol?

UNDER SECRETARY BURNS: What we want to do is regionalize and globalize biofuels.

REPORTER: (Unintelligible).

UNDER SECRETARY BURNS: Americans generally do not join cartels. We are the ultimate free traders and we are globalists in nature and we would like to see the benefits of biofuels go all around the world; both in terms of production as well as consumption. You know, our president set up a very ambitious target of reducing our gasoline consumption by 20 percent in 10 years. So, we have got a lot of work to do to meet that and biofuels is one of the ways that we can meet that.

MS. HELLING: Last one.

UNDER SECRETARY BURNS: Yes.

MS. HELLING: Very, very last one.

UNDER SECRETARY BURNS: We'll try to be real brief. You have one, yes.

REPORTER: I would like to go back to Iran. I see that you have worked with Madeline Albright at the State Department. The other day she said that the U.S. Government to start direct negotiations with Iran concerning the situation in Iraq and its nuclear problem and so on. How is it -- because it seems that the Iranians were not satisfied with the guarantees that were put before them by the (unintelligible).

UNDER SECRETARY BURNS: Well, I think, you know, we have an extraordinarily difficult relationship with Iran. We have not had diplomatic relations in 27 years. We have no contact with them. There are no embassies. So, what we tried to do last year, Secretary Rice on June 1, 2006, made the most ambitious offer to Iran since 1979. She offered to sit down with them along with Russia, China, Britain, France and Germany, and to negotiate peacefully a diplomatic solution to the nuclear problem, which all the world is concerned about. In addition to that, she said if we get to those negotiations, we would take the opportunity to discuss any other issue with the Iranians. So, frankly, I believe the ball is in Iran's court. It was not the United States that did what Iran has been doing and that has trying to subvert the government in Lebanon of Prime Minister Siniora. The United States did not give Hezbollah the long-range rocketry to fire into Northern Israel this past summer.

Certainly we have a direct concern that Iran has been giving sophisticated IED, improvised explosive device, technology to some of the Shia terrorist groups that have directly led to the deaths of American soldiers. We have to defend our interests. We are doing so in a peaceful way. We are stressing the diplomatic path. We believe that diplomacy can succeed. But the Iranians, they need now to think about their isolation and are digging a deep hole for themselves. They need to climb out of the hole. You know, it is extraordinary when you have Russia, China, Europe, United States all agreeing on one negotiating offer and then to have Brazil, India and Egypt vote in favor of that approach, which is what they did on February 4, 2006.

So, if Iran is listening to the rest of the world, it should not listen to just Venezuela and Syria and Belarus. Those are the only three countries I can find who support Iran. Everybody else believes that Iran should not become a nuclear weapons power. So, I think it is really Iran versus the rest of the world and we would like to negotiate if they are willing to negotiate.

REPORTER: (Unintelligible) Iran and Hezbollah and in Venezuela, (unintelligible) an agenda against (unintelligible). (Unintelligible) countries like Brazil or Latin America (unintelligible).

UNDER SECRETARY BURNS: Well, I have not read the article. I have a great admiration for Francis Fukuyama. I used to work with him at the State Department. But I have not read the article. I would just say this; that poverty is not a justification for terrorism. You have this extraordinary situation in India where you have got well over 500 million people living in poverty and you do not see in India the type of terrorism that you see elsewhere in the world. Iran has been a supporter of some of the major terrorist groups, Hezbollah, Hamas, Palestinian Islamic Jihad, and the states that tend to encourage these groups to take up terrorism.

So, yes, we are very concerned about poverty and social justice. We believe that as the global economic leader, of course, we have an interest and responsibility to try to address the issue of global poverty. We want to work with countries - that is on our agenda here in Latin America. But to say somehow that poverty, therefore, explains or justifies terrorism, if I got the drift of your question, I would not agree with that. I think most people in most countries would not agree with that either. So, without having read Francis' article, I would just answer your question in that way. Thank you.

ASSISTANT SECRETARY SHANNON: What we are going to do is invite all of you to listen to Secretary Burns in about 45 minutes, if you are interested, and if you do not have to file a story. But I have got to pull him out of here now. So, thank you all very much.

REPORTERS: Thank you.

UNDER SECRETARY BURNS: Thank you.