Hearings, Reports and Prints of the Senate Committee on Government Operations

The subcommittee met, pursuant to notice, at 10 a.m., in room 3302, New Senate Office Building, Senator Ernest Gruening (chairman of the subcommittee) presiding.

Present: Senator Gruening.

Also present: Herbert Beaser, chief counsel; Joseph Lippman, staff director; Harriet Eklund, editor; and Jean D. Reynolds, clerk, Sub-· committee on Foreign Aid Expenditures.

OPENING STATEMENT OF THE CHAIRMAN

Senator GRUENING. The Subcommittee on Foreign Aid Expenditures has scheduled these hearings to find out how U.S. aid programs to foreign fishing industries are managed by responsible administrative agencies with regard to the impact of such aid programs in encouraging foreign competition with our own domestic fishing industry. The subcommittee will inquire into the following matters:

(a) The extent and nature of U.S. aid programs to foreign fishing industries;

(b) The extent of competition with our domestic fishing firms that result from our foreign economic aid programs; and

(c) The extent to which the Agency for International Development coordinates its programs of economic aid to foreign fisheries with the U.S. position on international fisheries commissions.

These hearings will continue the interest I have in assuring that our foreign economic aid programs are managed in a way which does not encourage foreign industry to develop in competition with and at the expense of our own domestic firms.

COMMISSION EXPRESSED GRAVE CONCERN OVER SOUTH KOREAN PLANS

IN 1966

My concern on this matter was reinforced when I received accounts of the plans of South Korean fishing firms in 1966 to send their vessels to the North Pacific to fish for salmon and other varieties of fish. Since fishing in these waters is controlled by the International North Pacific Fisheries Commission, I inquired as to the position of the

Commission with regard to the plans of the South Koreans. I learned that in December 1966 the Commission, which consists of members from the United States, Canada, and Japan, had noted the South Korean plans to enter the salmon and other fisheries in the North Pacific and had expressed its grave concern for the Commission's conservation program over the implications of such a development. The chairman of the Commission was directed to bring this matter to the attention of member governments.

GRUENING SOUGHT RUSK'S REAPPRAISAL OF AID'S POLICY SUPPORTING SOUTH KOREAN FISHING INDUSTRY EXPANSION

Shortly thereafter I wrote the Secretary of State expressing my concern over this development. I pointed out that the United States had provided South Korea with $5 million in assistance in developing its fishing industry and was supporting South Korea's 5-year plan to spend about $35 million for development of its deep sea fishing industry. I wrote the Secretary of State that the support being given by AID to Korea's long-range plans for expansion of its deep-sea fishing and the financial aid being provided to that country's fishing industry appeared to be at cross-purposes with the efforts of the International North Pacific Fisheries Commission to discourage expansion of the Koreans into deep sea fishing in North Pacific waters. I suggested at that time that a reappraisal be made of AID's policy which supports expansion of the South Korean fishing industry and that consideration be given to terminating any assistance to the Korean fishing industry unless firm assurances are received that the expanded fishing industry would not be in competition with U.S. firms.

On February 8, 1967, I received a reply from the Department of State in which I was advised that the Department had been successful in focusing the attention of the Koreans on areas of expansion that will minimize the possibility that they will run into conflict with the interests of our own industry in North Pacific salmon and halibut fisheries. The Department of State also advised me that the assistance program is fully coordinated with overall U.S. fisheries policy. With regard to my suggestion for termination of aid to Korea's fishing industry unless firm assurances were received that the industry would not compete with our domestic industry, the Department of State wrote me that since the Korean fishing industry will expand with or without our help, the Department believed that it would have greater influence on the direction of Korean fishing policy by assisting it rather than by withdrawing.

The two letters mentioned will be inserted in the hearing record at this point.

(The letters referred to above follow:)

EXHIBIT 1

LETTER FROM SENATOR ERNEST GRUENING TO THE HONORABLE DEAN RUSK, SECRETARY OF STATE

Hon. DEAN RUSK,

Secretary of State,

U.S. Department of State,

JANUARY 27, 1967.

Washington, D.C.

MY DEAR MR. SECRETARY: The thirteenth Annual Meeting of the International North Pacific Fisheries Commission in November 1966 produced some facts

regarding plans of the Government of Korea to start fishing in the North Pacific. I find this most disturbing.

As you know, the Commission operates under the terms of the International Convention for the High Seas Fisheries of the North Pacific Ocean, which was signed by the United States, Japan, and Canada in 1952. This international agreement is designed to promote the conservation and proper utilization of the natural resources of the high seas.

At the conclusion of its November 1966 meeting the Commission issued a release which contained the following statement:

"On the final day of the meeting, the Commission took note of reports that the Republic of Korea may have plans to enter the salmon fishery and perhaps other fisheries in the area covered by the Convention and requested the Chairman of the Commission to call these reports to the attention of the member governments, to express the Commission's grave concern over the implications of such a development for its conservation program, and to ask the governments to give consideration to this matter."

I would like to call your attention also to an article which appeared in the December 3, 1966, issue of the New York Times, datelined Seoul, Korea. The article stated that South Korea is pushing ahead with its plans to send fishing fleets to the North Pacific in 1967 despite the grave concern expressed by the United States-Canadian-Japanese fisheries commission.

Data obtained from the Agency for International Development disclose that the Government of Korea has developed a second Five Year Plan which envisages a substantially increased investment for fisheries. Of particular importance is the fact that the Koreans are allocating the major share of the 26.5 billion won they expect to have available for investment, to the development of deep-sea fishing. This will amount to about $35 million in the five year period and is about as much as the combined total Koreans plan to invest in coastal and in-shore fishery, offshore fishery, and cultured fishery.

I need hardly point out the adverse effect this tremendous growth in Korea's deep-sea fishing capability will have on our country's fishing industry when Korea sends its fishing fleets to the salmon and other fishery grounds of the North Pacific. I am particularly disturbed by evidence that the Agency for International Development is supporting Korea's plans for expanding its deep-sea fishing. It appears that AID has approved or otherwise endorsed the second Five Year Plan of the Korean Government and has specifically endorsed Korea's plans to expand its high seas fishing. Thus, AID's Country Program Book states:

"Continuing expansion of Korea's high seas fisheries is essential if they are to achieve their total goals of foreign exchange earnings."

I also noted that AID has given the Koreans a considerable amount of assistance in past years for the development of that country's fishing industry. Some $5 million has been given to Korea in the last twelve years for a variety of purposes connected with the development of its fishing industry. This included $3.4 million for construction of fishing boats; $300,000 for research; and over $1 million for plants, markets, and processing facilities. Current economic assistance to Korea for its fishing industry amounts to over $200,000 for 1966-68 and includes a team of United States technicians to "provide technical advice on processing and management to various agencies and organizations in the fishing industry for expansion and modernization of the fishing industry." It is also planned to assist the Korean fishing industry by a program of training Koreans, at U.S. expense, in various aspects of fisheries management.

understand that officials of your Department are seriously concerned about the plans of the Government of Korea to begin fishing operations in the North Pacific. However, the support being given by AID to Korea's long-range plans for expansion of its deep sea fishing and the financial aid being provided to that country's fishing industry appear to me to be at cross-purposes with the efforts of the International North Pacific Fisheries Commission, of which the United States is a member, to discourage the expansion of the Koreans into deep-sea fishing in North Pacific waters.

I suggest you reappraise AID's present policy which supports expansion of the Korean deep-sea fishing industry and consider terminating any assistance to that industry unless firm assurances are received that such expansion will not be in competition with the United States.

With best wishes, I remain,

Cordially yours,

ERNEST GRUENING,
U.S. Senator.

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