FAC News – 2 August 2001

SEN. KERRY: Ms. Huhtala, Malaysia, obviously, recently -- particularly during the crisis in Indonesia and the "Asian flu" and so forth, had its own reaction to how it would manage its economy and how it would respond to the IMF and to sort of more transparent and accountable global associations. What is your sense of how that has fared for them relative to the countries in the region, and is that of concern to us as you engaged -- when you're confirmed -- engage in these responsibilities?

MS. HUHTALA: Well, Senator, we heard a lot of statements coming from the Malaysian government at the time of the economic crisis that raised, I think, the temperature of the bilateral relationship. However, in point of fact, the actual -- the actual taking care of the economy proceeded along fairly straightforward lines.

The one thing that the Malaysian government did was to impose capital controls, which have now been lifted. The Malaysian economy continues to be affected by world economic trends. Like it's neighbors in the region, it has still not completely recovered from the economic crisis. However, we have found that the many American companies that are operating there have not experienced any interference in their operations, and they are all still relatively bullish about continuing to maintain their operations there.

SEN. KERRY: How would you assess the slowdown of our economy and its impact on Malaysia at this point?

MS. HUHTALA: I believe it is having a very strong effect as it is, again, throughout the region. As I testified, we are the largest market for Malaysian exports, and obviously if our imports do go down, they will feel it.

SEN. KERRY: You mentioned the trial and imprisonment of Deputy Prime Minister Ibrahim. What's your sense of the impact, how lasting, or serious the impact of that trial would be both on the internal politics of the country but also on our relationship?

MS. HUHTALA: It looks to me like a real watershed sort of event, Senator. And there is no doubt that it is having an impact on the bilateral relationship, as well as on the political evolution within Malaysia. As you know, we consider it a very serious issue. Our human rights report has reported extensively on this case. We consider that Anwar Ibrahim is a political prisoner. We're hoping that this -- that his case can be resolved. I note that both of his convictions are currently in the process of being appealed to the highest court in Malaysia.

SEN. KERRY: In the last weeks, six key leaders of Ibrahim's opposition party were sentenced to two years under the Internal Security Act by the home affairs minister. What's the administration's view -- have you had a discussion with anyone about how -- sort of your -- what your message will be as you assume these responsibilities with respect to the continued use of the ISA to lock up political opposition figures?

MS. HUHTALA: Well, as you know, Senator, I just flew in last night from Thailand. I haven't had a chance to do the formal consultations that I will be undertaking for this position. However, I know that our administration has been very firm reminding the Malaysian government that this kind of arbitrary treatment of political dissidents does not advance their greater interests and is not something that we feel is compatible with their role in the region and in the world. If confirmed, I would certainly continue to press our view about these -- about these incidents.

SEN. KERRY: What is your assessment of Malaysia's view of the growing Chinese influence in Southeast Asia?

MS. HUHTALA: I think like all of the countries in Southeast Asia, Malaysia is watching China's influence closely. Malaysia does have a sizable Chinese minority among their own citizens. And it is of course to be hoped that Malaysia and the other countries of Southeast Asia will be able to have constructive relations with China. One forum in which that is being pursued fairly effectively is the ASEAN Regional Forum, which is meeting even as we speak.

SEN. KERRY: What would you say is the greatest challenge that you face as you start this?

MS. HUHTALA: My view is that Malaysia is going through a period of political transition, possibly transformation. It is a democracy. They will be having elections in the year 2004, and there may be some realignment of the political forces at play. The biggest challenge for any American ambassador during such a period is to insist that our bilateral interests are cared for and that the relationship remain strong, and that Malaysia will continue to be a good partner to the United States, as it has been for so long in the past.

SEN. KERRY: And leaving -- apart from -- it's not apart from, but beyond simply the Ibrahim issue, how would you characterize the human rights situation at this point in Malaysia?

MS. HUHTALA: It's not as good, obviously, as we would like it to be. It's not as good as it is in some of the neighboring countries. However, Malaysia is a democracy, and there are a number of protections for the citizens built into their system. One very encouraging thing is the new signs of judicial independence that we have seen in just the past few weeks. This is, of course, an essential bulwark for freedoms and democracies in any society. So, I think it is -- it's a system that has good points as well as bad, and that can certainly be improved.

SEN. KERRY: I would just like you each to sort of comment on that with respect to your country, and particularly whether you think there might be some opportunities for major technology and technical assistance transfer in the environmental field, and perhaps even in some other areas that might begin to glue back that consensus more effectively. Anybody who wants to lead off. I'm not going to -- Ms. Huhtala, why don't you go?

MS. HUHTALA: Well, I might start by saying that all of these kinds of transnational issues have assumed tremendous salience in the country I just finished my last assignment in, in Thailand. And I think it probably is also true in Malaysia. There is widespread concern about health issues, AIDS, access to prescription medicines, most of which have been developed in the West, trafficking in persons -- we just issued the new trafficking in persons report which kind of rated each country in the region on how they are performing -- and on the environment.

We have a number of programs that are either already developed or in the pipeline to assist these countries in meeting these challenges. And it's my view that we should do much more in those areas. Our CDC and our NIH are active in Southeast Asia. In Thailand CDC recently gas moved from pure research, which they were engaged in for 10 years, into a brand-new $8 million program of actual care for AIDS victims. I think that is the kind of -- just an example of the kind of program that would be very useful if implemented throughout Southeast Asia.

With regard to the human trafficking problems, this is assuming enormous proportions all over the world, and many of the unfortunate victims of this trade pass through our countries. The United States can do a lot to assist these countries, for instance, in the area of judicial assistance to help the countries beef up their own surveillance of the problem. We can get our INS more involved in helping monitor situations in airports to stop trafficking.

Also in the area of environment there are a lot of innovative technologies that are being developed here in the United States that we should be finding ways to share with these countries, because they have looming enormous environmental problems. In the case of Malaysia, the haze coming from neighboring countries is one of the most outstanding examples.

SEN. KERRY: Thank you very much for a comprehensive and thoughtful answer.

JULY 25, 2001