Washington -- Secretary of Transportation Rodney Slater says that African nations selected as the first participants in the Clinton administration's Safe Skies Initiative will have to demonstrate political commitment by spending their own money on improving their aviation systems.

In July 30 testimony before a House of Representatives Transportation subcommittee, Slater said an administration interagency group is working on selecting those countries for the initiative, which has three specific goals: quadrupling the number of African countries that meet international aviation safety oversight, improving security at between eight and 12 airports -- both within three years -- and improving regional air navigation services.

The secretary viewed air transportation as crucial to economic expansion in Africa, including expansion of its tourist industry.

"However, tourists will not fly to Africa if they fear for their safety and security," Slater said.

In other testimony, Slater commented on a legislative proposal that would require congressional approval of future U.S. bilateral aviation agreements. He said the current system in which the Transportation Department negotiates executive agreements with other countries while keeping members of Congress informed has worked well.

The secretary also defended European Union (EU) policy imposing conditions on alliances between U.S. and European airlines.

"Authorities on the other side of the Atlantic have a legitimate interest in ensuring that international aviation develops in a pro-competitive way," Slater said.

Following is the text of Slater's testimony as prepared for delivery:

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STATEMENT OF THE HONORABLE RODNEY E. SLATER

SECRETARY OF TRANSPORTATION

Before the COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

SUBCOMMITTEE ON AVIATION

Concerning THE AFRICAN AVIATION INITIATIVE

July 30, 1998

Mr. Chairman and Members of the Committee:

I thank you and the committee for your timely invitation to place Africa and its aviation environment in the forefront of our continuing national dialogue on aviation safety and security, both at home and worldwide, and to focus on the international trade and growth opportunities that spring from a vibrant aviation sector.

These are exciting times in transportation generally, and I congratulate the committee on the tremendous success in enactment of the Transportation Equity Act for the 21st Century. President Clinton early on made infrastructure investment one of the linchpins of the economic vitality we all now enjoy. I am proud to be a part of the substantial achievement that TEA-21 represents in ensuring valuable and needed investment in the nation's surface transportation infrastructure.

Our African initiatives at the department are only one element of the Clinton administration's overall "Partnership for Economic Growth and Opportunity with Africa." The transportation element is an effort to support Africa's integration into the global economy and to facilitate linkages within the African continent and between continents that will facilitate trade and development.

I recently returned from an eight-day trip to Africa, my third trip to the continent as Secretary of Transportation. In the last year, I have visited 10 countries in sub-Saharan Africa and met with heads of state, government ministers, and diplomats from nearly every country in the region. What these experiences have most impressed upon me is that Africa is a continent revitalized by change. The number of democratically elected governments in sub-Saharan African countries has quadrupled in the last 10 years, and three-fourths of the region's 48 countries have begun economic reforms. I have seen firsthand that democracy and market-based economic policies are bringing new hope and greater prosperity to the people of reforming nations across the continent. As South African Deputy President Thabo Mbeki first said, this is Africa's renaissance.

The United States has a vital interest in supporting Africa's growth and development. With more than 10 percent of the world's population and vast reserves of natural resources, Africa represents a market with great potential. Already, we export more to sub-Saharan Africa than to all the states of the former Soviet Union, and over 100,000 American jobs depend on our trade with Africa. Furthermore, a strong and stable Africa is key to our efforts to counter global threats such as drug trafficking and terrorism. Finally, many of the world's newest democracies are in Africa, and we have a compelling interest in ensuring that these nascent democracies succeed.

President Clinton has affirmed that Africa is fundamentally important to the United States and that we can no longer afford to neglect this vast and mighty continent. He has declared that the marginalization of Africa is over, and that it is time for Africa to be welcomed as a full partner in the global community. The president's historic trip to the African continent was a powerful affirmation of this new policy. I had the privilege of accompanying the president on this trip, and I witnessed the excitement with which the president's words were received and the eagerness of Africans to cultivate a stronger relationship with the United States.

The president vowed that his trip was not a one-time event, but rather the beginning of a sustained partnership between the United States and the nations of Africa. I was pleased to return to Africa earlier this month to follow up on the president's promise of continued engagement. Treasury Secretary Rubin led his own delegation to the continent soon after me, and Commerce Secretary Daley will lead a trade mission to the continent in September. In December, the president will hold the first ever Cabinet-level U.S.-Africa Trade and Economic Cooperation Forum. Clearly, this administration is serious in its commitment to work with Africa in a partnership of mutual interest and mutual benefit.

Congress has also shown great leadership in promoting expanded engagement with the nations of Africa. In March, the House passed the African Growth and Opportunity Act (H.R. 1432), a landmark legislative initiative to forge a new trade and development relationship between the United States and the countries of Africa. This legislation is key to ensuring the sustainability of a U.S.-Africa economic partnership. It is a good bill and enjoys broad bipartisan support as originally adopted. While I am concerned that the bill may become embroiled in unrelated trade issues, I want to emphasize the administration's strong support for the measure that passed the House.

Earlier this month, I had the pleasure of traveling to six African countries: Cape Verde, Ethiopia, Zimbabwe, Angola, Cameroon, and Senegal. I am pleased to say that this trip was a resounding success.

The main purpose of my trip was to begin the implementation of the Safe Skies for Africa Initiative, which the president announced while in Senegal in April. The purpose of this initiative is to promote sustainable improvements in aviation safety and airport security in Africa so as to foster the environment necessary to expand air links between the United States and African nations.

I convened two regional meetings of African Ministers of Transport in Harare, Zimbabwe, and Dakar, Senegal, which focused on aviation safety and security. These meetings were attended by 29 ministers of transport or their delegates as well as by representatives from the International Civil Aviation Organization (ICAO), the International Air Transport Association (IATA), the World Bank, the African Development Bank, and by numerous other representatives from aviation associations and African regional organizations.

In both Harare and Dakar, we engaged in very substantive and enlightening dialogue, and I learned a great deal from our discussions. In particular, a point that we came back to time and again is that aviation is key to Africa's development and integration into the global economy.

Air transport is the clipper ship and the iron horse of our day, and better air services -- both passenger and cargo -- are a prerequisite for expanding trade and tourism, two powerful engines of economic growth for African nations. Today, fully one-half of all international commerce is conducted by air -- but you can't trade if you can't get there. Therefore, Africa's aviation infrastructure must be improved if tomorrow's trade possibilities between the U.S. and Africa are to be realized. Furthermore, tourism, the world's largest industry, is rapidly becoming one the most important and lucrative businesses on the continent, and the development of the tourism sector is a high priority for many African governments. However, tourists will not fly to Africa if they fear for their safety and security.

In short, improvements in aviation safety and security open the door for expanded air service, which in turn spurs economic growth and development. It is for this reason that the Safe Skies Initiative is so critically important -- for both Africa and America.

The fundamental premise of the Safe Skies Initiative is that of partnership. The U.S. role in the initiative is as a technical advisor and facilitator of actions to be taken by African states, with assistance from the private sector, regional institutions and international civil aviation organizations.

African nations must assume ownership of the Safe Skies Initiative. In fact, host governments bear primary responsibility for funding the program. African governments must recognize the importance of an adequate aviation infrastructure to support economic development and be willing to devote the necessary resources and marshal the political will to make sustainable improvements in their civil aviation systems.

We have set specific goals for the Safe Skies Initiative: first, to quadruple the number of African countries that meet International Civil Aviation Organization (ICAO) standards for aviation safety oversight within three years; second, to improve airport security at between eight and 12 airports in Africa within three years; and finally, to improve regional air navigation services.

Allow me to share briefly how we intend to reach these goals. As a next step, an interagency working group led by my department will identify the nations that will be the first participants in the Safe Skies Initiative. The selection of participants will be a function of several clusters of criteria. However, first and foremost, participants must demonstrate high-level political commitment to address aviation issues effectively, as evidenced by devoting the necessary resources to make and maintain improvements in their aviation systems.

A total of eight partnership countries will be selected for thorough navigation management reviews and aviation safety and security surveys to be conducted by the FAA over a three-year period (two in the first year and three each in the second and third years). In addition, eight to 12 additional countries will be selected primarily for airport security surveys and security improvement regimes focusing on customs, immigration, and drug enforcement services.

Following the surveys, the participating U.S. government agencies will help each country develop a work plan for improving its aviation infrastructure. Implementation of this work plan is ultimately the responsibility of the African countries themselves. However, participating African nations are encouraged to work with international aviation organizations and the private sector to enhance their own resources. In addition, it is important that African nations learn from the countries that have achieved success with their aviation systems, such as Ghana and Ethiopia. These countries serve as models for the rest of the continent.

We are also working with the International Air Transport Association (IATA) to help African countries establish aviation systems that are revenue generating and self-financing. Only through reinvesting aviation revenue in aviation infrastructure can improvements be sustained in the long term. Furthermore, with a guaranteed future stream of revenue, development banks may be more willing to fund aviation infrastructure projects.

The Safe Skies Initiative is premised on the idea that aviation is a long-term driver of economic growth and development. To that end, the initiative lays the groundwork for the future development of air services. Along with the safety and security effort, we have established open, forward-looking dialogues with several African countries to begin mutually beneficial steps toward increasing service opportunities in the market. In conjunction with the State Department, U.S. and African airlines, and African governments, we are working hard to facilitate safe and convenient air service between the United States and Africa.

As a result of these efforts, we are already seeing improvement in U.S.-Africa air services. Last month, after the FAA accorded Ethiopia "Category I" status for its safety oversight, Ethiopian Airlines commenced direct service between Addis Ababa and Washington's Dulles Airport, becoming the fourth sub-Saharan African airline to serve the U.S. (in addition to South African Airways, Ghana Airways, and Air Afrique). Ethiopia's achievement serves as a model for the rest of Africa, and on my visit to Addis Ababa, I had the opportunity to commend Ethiopian officials personally for their achievement.

We are also beginning to see greater interest in Africa from U.S. carriers. Just last week, Polar Air Cargo received the last necessary element of its operational authorization to commence service between New York and South Africa, Zimbabwe and Kenya. In addition, U.S. charter air carriers are also beginning to look more closely at opportunities in Africa.

One of the most important developments for priming the growth of the U.S.-African market has been the expansion of services to Africa through code-sharing alliances. Several U.S. carriers offer service to Africa over European cities in conjunction with their European partners. Similar joint services are developing between U.S. and African airlines as well. My department recently approved a Northwest-Kenya Airways code share through Amsterdam, and American Airlines has been code sharing with South African Airways for almost six years.

Many African governments now recognize that aviation is key to their growth and development. As a result, a number of them are beginning to realize that liberalization of civil aviation is not only possible, but also imperative if we are to awaken long-neglected aviation opportunities. To that end, the United States is promoting liberal aviation regimes as the best way to serve the consumer and the overall economy. Several of my African counterparts have responded positively -- or indeed have come to us on their own initiative -- and have asked to explore establishing new civil aviation regimes with the U.S.

I also want to note that there has been tremendous interest in the Safe Skies Initiative from U.S. companies in the aerospace sector. Boeing projects a market for large commercial aircraft of $14 billion ($14,000 million) in Africa over the next 10 years. In addition, U.S. manufacturers of jet engines, air traffic control equipment, and navigation systems have all voiced their support for this initiative and indicated their strong desire to participate in the development of Africa's aviation sector.

Clearly, it will take time for the African market to develop. We must remember that we are beginning a process in an area that has been long neglected, and achieving progress will take time and patience.

Nonetheless, I am confident that the Safe Skies Initiative will be a success and that it will open the door to a wealth of opportunities -- for both Africa and America -- in the years to come. Working together, we can turn the ocean that divides us into a bridge that connects us.

I also want to point out that my department's efforts in Africa extend far beyond aviation issues. We are engaged in a range of efforts which aim to address Africa's most pressing transportation needs -- from highway technology and traffic safety to port development and maritime security. In addition, we are pursuing partnerships with international financing organizations, such as the World Bank, and African regional bodies, such as the Organization of African Unity (OAU) and the Southern African Development Community (SADC).

I would now like to take this opportunity to speak to a number of other issues of particular interest to this subcommittee in the realm of international aviation. First, I would like to focus on the successes in the international aviation area that have already been achieved for U.S. consumers, U.S. airlines and U.S. cities. Second, I would offer our perspective on Ranking Member Lipinski's proposal for a change in approach to negotiating international aviation agreements, as embodied in H.R. 3741, the Aviation Bilateral Accountability Act.

The past 61 months have been some of the most productive in the history of U.S. bilateral aviation relations. We have entered into 64 new agreements, 30 of which are open-skies regimes. These new agreements have spanned the globe, opening up opportunities in Europe, in Asia, in the Middle East, in Canada, and in Central and South America. In most cases, we have agreed with our partners that the newly negotiated rights will become available immediately. This has allowed the department to move forward quickly -- to turn negotiating successes into actual aircraft operations.

The ability of the United States to achieve these impressive results, and our work is continuing, rests, I believe, on the cooperative foundation that underlies the development of U.S. aviation policy. Not only do the executive agencies work together, but they in turn work with U.S. industry and civic parties -- and importantly with Congress. Congressional input has been a key component in U.S. aviation initiatives, such as the move to open-skies agreements. We at the department have sought to ensure that the communications channels with Congress are open, with information and ideas flowing in both directions. These channels are important not only when policy initiatives are being considered, but also when significant negotiations are in progress. I and the department staff have met regularly with members of Congress to discuss aviation issues. We have welcomed the presence of committee staff in negotiations of particular concern to Congress. In addition, we have sought to be pro-active, and not just re-active, in keeping Congress abreast of international aviation developments by taking the initiative in briefing committee staff. We believe that the current processes have worked well and have allowed the views of all constituencies interested in expanded aviation services to be considered. At the same time, we would welcome any suggestions on ways to improve these processes. I am most interested in satisfying the ranking member that we have met our responsibilities in this regard and properly respect the role that Congress plays in the process.

Before concluding my testimony, I would like to update the committee on the progress of the European Union's review of alliances involving U.S. and European airlines, and DOT involvement in that process. As you know, the application from American Airlines and British Airways for antitrust immunity for their proposed alliance is pending before the department, and we are also considering a complaint from United Airlines concerning the proposed commission conditions that would apply to that airline's alliance with Lufthansa and SAS. Consequently, I am limited in what I am able to say.

First, the facts: The Commission of the European Union has reached a preliminary opinion that both the proposed alliance between American and British Airways and the operating alliance among United, Lufthansa, and SAS "infringe" the competition provisions of the Treaty of Rome. The commission has also proposed remedies in seven areas that would, in its view, bring the infringements to an end. Specifically, the commission is considering requiring the alliances to reduce flights on certain "hub-to-hub" routes to allow competitors to the alliances to establish services. In addition, the alliances would have to make slots and other facilities available at their European hub airports to competitors for services in other transatlantic markets. The commission has also proposed conditions on frequent flyer programs, displays of flights in computer reservations systems, travel agency commissions and corporate fares, and interlining. The commission is also interested in access for all EU airlines between the United States and the alliances' homeland markets. Once the commission's opinion has been formally published, interested parties will have 30 days to comment on the commission's findings and remedies.

Second, what is the department's reaction to the commission's approach? I believe that alliances have been an important catalyst in liberalizing the international aviation market and have brought the benefits of more competition to thousands of city-pair markets, providing aviation consumers with multiple new service options. However, just as the department recognized some potential areas of concern with the alliances and imposed conditions on their operations, we must also accept that authorities on the other side of the Atlantic have a legitimate interest in ensuring that international aviation develops in a pro-competitive way, which can include evaluation of alliances involving U.S. and European airlines. To foster as compatible a regulatory environment as possible, department staff, along with representatives of the State and Justice Departments, have met informally with commission staff to discuss analytical approaches to alliances and their competitive implications. We have also explained the basis for the conditions that the department has imposed on the already immunized alliances. I believe that these contacts have been very beneficial, and department staff will continue to work with the commission on these issues. However, as I mentioned, the department has to rule on the American application and the United complaint, and I am not in a position today to comment on the specifics of the commission findings.

Mr. Chairman, this completes my statement. I would be pleased to respond to any questions you or members of the committee may have.

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