DEVELOPMENTS IN THE MIDDLE EAST, MARCH 1988 TUESDAY, MARCH 15, 1988 HOUSE OF REPRESENTATIVES, COMMITTEE ON FOREIGN AFFAIRS, SUBCOMMITTEE ON EUROPE AND THE MIDDLE EAST, Washington, DC. The subcommittee met at 1:38 p.m., in room 2200, Rayburn House Office Building, Hon. Lee H. Hamilton, (chairman of the subcommittee) presiding. Mr. HAMILTON. The meeting of the subcommittee will come to order. The Subcommittee on Europe and the Middle East meets in open session today to review recent developments in the Middle East and the Persian Gulf. Because of scheduling difficulties and the hectic pace of recent United States diplomatic efforts in the region, this is the first formal public hearing with administration witnesses this year. This hearing follows two hearings held in MidDecember on the West Bank and Gaza and on the Persian Gulf. Today's hearing will focus primarily on United States efforts to restart the Middle East peace process. The continued violence on the West Bank and in Gaza and the situation in the Persian Gulf. We are pleased to have with us today Assistant Secretary of State Richard W. Murphy. Secretary Murphy, we appreciate your appearance today. We know this is a very busy time for you. We understand you have a prepared statement. That statement, of course will be entered into the record in full. We want to allow ample time for questions. You may proceed, sir. STATEMENT OF HON. RICHARD W. MURPHY, ASSISTANT SECRETARY BUREAU OF NEAR EASTERN AND SOUTH ASIAN AFFAIRS, DEPARTMENT OF STATE Ambassador MURPHY. Thank you, Mr. Chairman. I'm very happy to be able to be here today to brief the subcommittee on developments in the Middle East and the Persian Gulf. You spoke of the hectic pace, and I take it that is your acknowledgement that I was not trying to dodge one of these hearings over the last couple of months. There was some suspicion expressed by your staff. Mr. HAMILTON. There's been no charge levied against you, Mr. Secretary. Ambassador MURPHY. No, but I felt if I didn't make it today there just might be. (1) shipping in the Gulf, has been an unqualified success. Since July of last year over 40 convoys have been completed. Over time we have been able to draw down assets stationed in and around the Gulf with no decrease in the amount or quality of protection which we provide. Our demonstrated staying power has given credence to our commitment to help protect our friends in the region from Iranian intimidation, to help keep international waterways free of mines, and thus to ensure access to the vital oil reserves of the region. Our overall goal, of course, remains a negotiated end to the war in accordance with Resolution 598, a resolution which Iraq has accepted. Iran, however, continues to insist on re-writing that resolution as a pre-condition for its willingness to implement it. Our objective of bringing about a second resolution has been thwarted in large measure by Soviet unwillingness to proceed. The Secretary discussed this issue intensively in Moscow during his visit there in February. I raised it in my own talks last week in Moscow. We have not yet convinced the Soviets. This issue, therefore, will again be high on the agenda when Secretary Shultz meets next week in Washington with Foreign Minister Shevardnadze. An important element of our policy has been the limiting of the sale of arms to Iran. 1987 was one of the busiest and most successful years for Operation Staunch. The most positive results were achieved in Western Europe. In 1984 some 15 Western European nations sold more than $1 billion of arms to Iran. In 1987 this dropped to six nations selling about $200 million of arms. In various European countries their own media inquiries into alleged arms sales to Iran have mobilized public interest and sparked political controversy. As a result, Iran generally has had greater difficulty buying the parts and replacements for the modern Western weaponry which it inherited from the Shah's regime, as well as new high tech, Western military systems. It is believed that China supplied Iran with well over half of its arms imports in 1987, including surface-to-air missiles, artillery, and ammunition. We have made major efforts to persuade China to reduce arms exports to Iran. We discussed this issue further with Chinese Foreign Minister Wu on March 7th and 8th. He reiterated that China would not sell Silkworm missiles and would support a follow-on arms embargo resolution in the Security Council if there is a majority in favor. We said we would begin taking measures to move ahead on liberalization of the COCOM tech transfer regime, but cautioned that China's words and deeds would be important for keeping the proc ess on course. This year's proposed arms sales to the region are modest and, we feel, non-controversial. Many are sales of follow-on support items, routine procurement of standard military items, or for modernization packages for systems previously sold. This year's sales directly support the ongoing United States initiatives to achieve diplomatic breakthroughs in the Middle East, the Gulf, and Afghanistan. Military sales to moderate, pro-Western Arab states promote the ability of our friends to defend themselves, as is now the case in the volatile Persian Gulf. Our military sales to Israel, much of them financed through forgiven FMS credits, play a key role in helping Israel to maintain its qualitative military edge over potential opponents. We will not sell weapons in the Middle East that will threaten Israel's qualitative military edge. Again, I thank you for this opportunity to appear, and would welcome questions. [The prepared statement of Mr. Murphy follows:] PREPARED STATEMENT OF HON. RICHARD W. MURPHY Mr. Chairman, I am delighted at last to be able to brief the committee on developments in the Middle East. Since mid-December, when we had the last formal update, U.S. diplomatic efforts have been extraordinarily active across the whole sweep of our region. The challenges we face are of signal importance to U.S. national security interests. There has been concern in the past that the U.S. had been consigned to the sidelines as a passive observer of events in the Middle East as a region. The facts of the past several months belie those assertions. In the Middle East, we are working intensively to bring the parties together directly in dialogue on a true, durable peace in which all parties must compromise, and from which all parties will benefit. In Lebanon, we have been encouraging a process of dialogue that could help end years of bloody civil war. In the Persian Gulf region, our naval escort operation is working smoothly, aided materially by the cooperation of our western |