and that is an extraordinarily important job for our military. and to talk about the future holds, not just in the relationship but also in the recovery of japan. all i am honored to welcome the ambassador of japan to lead off the discussion. ichiro fujisaki can the ambassador to the united states almost four years ago and served as ambassador to the international organization in geneva and prior to that was japan's deputy minister for foreign affairs. i work with him to the podium right now. thank you mr. ambassador. [applause] >> thank you very much for the kind introduction, ladies and gentlemen. looking at this crowd, i had been afraid that many of you this is already the 24th time

that you are going to hear from me. thinking if i could say something new, but not too much. please forgive me. the compensation is that i will be very short. yesterday i was leading a newspaper here. i was a bit surprised that the tall conical top line started like one year later nothing is solved with a big picture a young lady with little boy and i don't share that view. i am not saying that everything has been solved. it's not at all true because it was a huge disaster as you know. so, we can't think of it on the

in a year's time but what we can say is we are on the road. i will give you a chart of paper , which illustrates what it was, and where we are on the damage and the nuclear issue. the number oneness human loss. as you can see it as close to 19,000 people still either missing or found dead. this is ten times that of katrina. the damage to building infrastructure. katrina was $5.5 million.

11 was 34. and on top of that there were housing but altogether and set $2,012,000,000,000. you can see how huge this disaster was. the effect to the gdp, 2012 destin net loss 1.6. after the estimate is 0.9. it's not only because of the great tsunami but it's appreciated more than 40% after wall street crashing which is less than 10%, and the euro depreciated by 10%. how can you compete in such a

situation? supply chain issue, number four. i am always trying to focus on this because i think the supply chain is exaggerate. this is a figure, 2007 the u.s. productions as 100. in 2008 crashed because of the lack of consumption and went down to that level for some time. compared to that, yes, there was a lack of supply of parts from japan that went down to 85 and stayed in very short period and recovered now to already more than 100 level. this is the production gunning and as the state of the union

said, the industry's you can see that as well. so i think the supply chain issue in my view i'm not saying there was no problem. we had problems, but not as big as some people have an image of. now the recovery of the infrastructure, this blue are is where it was right after the earthquake went down to 24% in two weeks the highway 100% will completely shut down. there were the bullet trains running at the time that the no passenger soon as the train cut the seismic waves it stopped,

but we were able to launch to the 100% level because we had to do the maintenance for the wave as well. now it is taking time. it is up to 73% yet because a lot of debris in the sea and the port is built so not 100% yet. now electricity coming in the metropolitan area, i'm sorry, it went down to 16%. we covered 83% in three days and in a week's time, 95. the tokyo area this was not only tokyo, but quite a big area from the site in those areas was down

to 79% and went up to eight in a week's time. so these infrastructure recoveries are pretty quick quicker than a lot of people thought. there was huge damage as for the human rights and also jobs 81,000 people lost their life and -- jobs, i'm sorry. 51,000 acres were inundated, 28,000 ships were lost. so there was a lot of damage but we are trying to recover by getting a lot of budgets and in four years' time we will recover 95% of all of those lands that

were inundated. but the serious issue here is still this nuclear issue. i will put this into perspective. in the iaea international atomic energy agency dea skill called international nuclear defense which is from the lowest one to the highest seven. seven is the most serious accident and one is the most minor, and remodels years ago this is classified as number five level. what this fukushima is a plus seven, the most serious. however there is a great difference between the two

because in fukushima, the nuclear reactor itself did not exclude. it was an explosion of the house of town that by hydrogen and it was not an atomic nuclear explosion. the other was around the atomic nuclear reactor, so because of these two reasons, the level of the radioactive material in fukushima as 1/7 and there was no immediate death toll whereas there was off 31 immediate death toll in a lot of people affected more than hundreds as you know, so that is the great difference even if they are on the same

scale. and as a result the level in tokyo and the u.s. and france is not that different, almost equal now. tokyo today and the u.s. and france i have figures for some time ago white you can say that is almost. however, the nuclear reactors are not operating now. we had 54 nuclear reactors. this is rule number three. number one, the 104, number two, france was 57, and japan, 54, and about 11 was stopped because the earthquake and tsunami. however, today only to operating

and 52 is now operating. why? because every 13 months you have to put nuclear reactors into maintenance and after that you would put into the stress and after that the government has to decide and then have discussions with local communities. this is not a requirement to have this is customary. so, we have not arrived in that stage to restart a nuclear reactors. this is the situation, so we are only operating to out of 54. and the radioactive road map to the restoration. as for the reactor itself, last

december we came to a situation equivalent to what they called the shutdown, that is lower than the 100 degrees, and we have some leakages from time to time that in general i think the situation we can say is under control. it was declared in september. however, that does not mean that everything is already taken care of. we need a lot of time because we have to take care of decontaminating debris and we have to decommission and it will take years. but one thing i can say is we are. now under control of the situation. meanwhile because 52 is not operating we are dependent more and more on thermal image as you

can see here. thermal imaging is the 2010 figure before the crisis we are dependent on about 52% but gone down. you see that nuclear now this is december now it is even lower. and in two months if we don't restart we will have nuclear. this is a very serious situation for japan, but as you can see, we are dependent more and more on profitable imaging at this juncture. one thing beyond this poll which was taken about three weeks ago,

24% of japanese think that we should abolish using nuclear, 53% think we should draw down, decrease dependence, 15% think we can continue on. this is the sort of public image. it was very different right after the tsunami many people thought we can go on, this number is going down and we have to reflect this thinking because this summer we will try to seek a new energy mix. we were thinking that we would increase dependency. we were dependent about 26% or so. now we were thinking that we

would increase it to 53% level in her 2030, but this was not possible light think with this public thinking we want to review the energy mix but we will have to decrease dependency on nuclear rather than increase. this is what the prime minister is already saying. we cannot totally dispose eight. we will try to see what will be the right balance here. i was visiting japan ten days ago. i met the deputy mayor and the governor and asked them what

will be the message? two things, one, please convey our thanks to the american people. second, please, don't forget us. it will take more time to recover. please, trade with us, please invest in us and visit us. that was the plea, and i am conveying this to you. of course as you can see it drop very heavily. the blue dots are the lines so at the end of the year it caught up and during the spring and summer this is natural. but because of the situation by and explaining in this part of

japan there is no contamination, and food and water, everything is monitored very carefully. it is safe now so, please, take a look, and i am always saying that we are grateful for visitors to japan. secretary clinton visited months after. the vice president visited japan and went to the site four months later. they came and what lady gaga made several visits as well. we are grateful to the different of japan. i call her foj, friend of japan to read the plan for the reconstruction there is a budget getting up to $25 billion, and the basic conception is that we

will have all been reconstruction. we need your ideas, your planning initiatives for the american or japanese companies alike will be exempted from the corporate tax and receive financial support for establishing the new company's. looking back at our disaster which was experienced one year ago, i think that we have to draw some lessons. my way of putting it is that i can say it by serving peace.

the first is p for production but however prediction there is a limit to that and sometimes prediction cannot be so reliable. there are a lot of these. second p is prevention. a natural disaster. this is not possible. it's to mitigate but there can be prevented flutters and that is exactly what we have to be looking at. where to place for example. third is preparation. you have to prepare people and the the government, you have to prepare the local community because if you look at history,

you know that these things will happen, and one thing that will happen these tsunamis have happened already two times in the last 100 years so we have to really prepare ourselves for that. fourth is of course prompt action when things happen to read we are now reviewing everything has to be very prompt and also the prioritization. there are a lot of issues so we have to prioritize human life first, housing first, not everything at one time, but of course everything has to be at one time, but we have to really prayer it is the allocation of the resources not only money resources human-resources as

well and fifth and maybe one of the most important is public understanding because this means in other words transparency. i think we have a duty in japan to share everything we have learned with other people because you have helped us we cannot see that other countries around the world will go the same as us so we have to say where we went wrong, where we went right as well, and this was the most important duty that is facing us now. next is the review, and this is exactly for that and i am very happy that a aei has organized this and in japan there has been research on that.

the government is now doing this diet commissioning this as well. we are trying to find what was right and what went wrong and we have to be very candid about it so we are trying to do this, and last i didn't say at the out said that we always were saying that as i said we were on the recovery road but it wasn't just by ourselves, it was because of the help from people around the world. of course japan has some strong points. we have recovered from, for example the closing of japan for 200 years and we were opened up in 30 years we were able to be among one of the powers. after the investigation from world war ii after 20 years we

were able to hold zero -- host all of the games. its place in japan because we don't have energy at all, and still we were able to combat and if most cars in the economy compete with other countries so we were able to turn the table and meet the challenges to opportunity and i think we will try to do this again, that it's because people have helped them in america as you've said have helped us during the most difficult time and japanese will never forget that american friend should that meant a lot to us that american people stood

with us. it wasn't only words as you say, it was people coming in and help us, search and rescue, in a lot of good will contributions, and it's amazing how people are now looking at american friendship in japan, so from the bottom of our heart, i always say thank you very much. [applause] >> the ambassador has agreed to do q&a for about ten or 15 minutes. we will have microphones if you could make your questions very brief and just identify yourself

we would appreciate it. >> as you can see i was going to get out and i was told no, no, you have an obligation here. i would contradict. you can make a ten minute speech if you liked. [laughter] please, go ahead. >> gary blumenthal. mr. ambassador, just curious, what is japan doing to recognize the individual workers who have made a great personal sacrifice to try to prevent further damage to the rest of the population from the fallout? >> i think that you are talking about people that are working in the nuclear site and also those

people in the police force, self-defense force, fire department people. there are a lot of people that have worked, and i think the most -- i should not say legal dhaka but are those workers on the site who have really been there all the time. if they had left to think it would be such a disaster so, i think it is we should recognize that i don't know how we can because there are a lot of people maybe it is that their work is going to be done in a group or individual. i'm sorry i do not know at this juncture, but i say this because this is so difficult on the american side extending gratitude there are some people of on the front but a lot of

people on the backside who were not seen by us but 247 we are working all the time, i don't know how we can identify it, but i think that the gratitude should be there and i personally have expressed gratitude to those workers who have been working on the site. thank you.

>> [inaudible] >> i cannot say a specific area but i think as i said, we have prescribed to set up a special district where taxes exempted and special subsidies, therefore any companies to come in and i don't know how profitable it is but i hope that these will be brought in by american colleagues to come to the sites, but also we would appreciate as i said visitors to japan, but as

for the specific corporation for the company, i think as i would just say as many as possible i cannot identify. thank you very much. >> investor, voice of america. you mentioned the partnerships to develop and share the experience so, united states right now is reviewing its own nuclear claims so if there is sharing between the united states and japan and what about with japan's neighbors like china, korea or taiwan? thank you.

we don't hesitate to share that with other countries. we don't want to see something that happened to us, to other countries.

>> could you characterize the impact of chinese reactions after the tsunami happened, over the past year on the japanese-chinese relationships? >> china was -- thank you very much. china was very forthcoming and were trying to do all the humanitarian efforts they can, sending doctors, sending rescue teams, sending a lot of materials in kind, and we have been helped a lot by chinese friend. as for -- as relates to other issues with japan-china relations, that's different from that. they were doing that from humanitarian effort, not to

reform japan's view. if you're trying to focus on disputes over some island, it has remained that way. nothing has changed. but has for the humanitarian efforts that china has done, we're very grateful for that. >> before i ask you to join me in thanking the ambassador, we have an excellent panel in just a minute. but now thank you so much -- >> i think they well deny everything i say. thank you very much. [applause] [inaudible conversations]

>> that was a quick turnover, thank you for joining us, i'm an asian fellow and school hard here. we were grateful to have ambassador here to kick off an extended discussion among our expert panelist, primarily on lessons learned, what are they, where do we go forward, and as we sitting in america try to understand japan0s response to the disaster of 3/11, how do we see our role and what we have done together. there are a lot of familiar faces in the audience today so this is going to be more of a discussion, i think, among friends and people who know each

other rather than something formal. we have assembled probably the most knowledgeable people on japan here in washington here for this discussion, and i think the rust may professor -- profess shock, these are the turn-to people when we want to understand politics, securities, economics. i'm going to ask each of them to give five to seven minutes of comment asks then we're going to end promptly at 2:45. sitting to my immediate right is ambassador russ demming, who served 38 years in the department of state, both here and in tokyo, as well as other areas of the world,; rust, as yu may remember, came back to the state department to head up the japan desk days before the quake

and was literally the man on the spot, the in d.c. next to him is sheila smith, one of the truly well-informed and insightful scholars of japanese politics, of alliance relations between japan and the united states and everything that gets to the core of how the japan and united states work together in the world. and then batting cleanup, marc knapper, who heads up the japan desk at the state department so dealing with the follow-on effects of 3/11 but probably the leading person in his generation on japan affairs in the state department, having serbed there as well as other parts of the world and most recently in baghdad. so we're glad to have you back happening -- handling affairs to foggy bottom. >> a pleasure to be here and thank you for organizing this.

let me just speak briefly about my perspective, having, as was said, come back to a position i had 20 years earlier, a few days before the earthquake. when the earthquake hit, we approached this with a great degree of humility. we have been through our own crisis management issues over the last three years, katrina, the gulf oil spill, the haiti earthquake, and just a month before, the christ church quake in new zealand. and we knew how difficult it was to manage a crisis. so when we went into this, with humility and also a lot of experience and lessons learned that we hoped would be useful. when we i got to state department 7:00 a.m. on the friday morning of march 11th, four or five hours after the earthquake, it was already apparent the dimensions of this

and we organized a task force, and instructions came immediately from the white house and the secretary of state, secretary of defense, do everything you can to help japan. and that was not rhetorical. it meant we could push aside the normal bureaucratic legal and accounting obstacles and worry about how to pay for it later on. the amount of dedication across the u.s. government was simply amazing, not just from the foreign affairs agency but from the domestic agencies. people really do mobilize and really did step out. three areas of our focus, first, obligation we have to account for and support american citizens, and our embassy in tokyo immediately organized teams to go up to the area. i must say, the japanese employees in our embassy played an extraordinary role. many of the subways were

interrupted. people walked two or three hours to get out there and that part of the operation went smoothly. second to do everything we could to help japan on the humanitarian side of the equation. we recognized japan had tremendous resources of its own and a lot of experience in delling with this kind of crisis, so our role was supplementary, not basic human needs. and in this regard our great asset was the u.s. forces in japan, and then close relation between them and the japanese self-defense forces. they worked together both in exercises and in the indonesian earthquake and started close ties between the two, and our military mobilized to send 22,000 people up to the earthquake area, primarily to clear the airport and make it possible to move things around, and that part of the operation broke new ground.

the first u.s.-japan joint task force, and while there were bumps in the road, it really did work well. lots of lessones learned for the future but it was, i think, a standout operation. and, third, the nuclear issue. at first we didn't quite understand the dimensions but over the first 24 hours or so it became clear this would be the center of our attention. the u.s. and japanese nuclear industries have a long history together. the reactors of fukushima are based on u.s. design. we knew about them. our nuclear industry original with them, regulators worked together so there was a natural contribution the u.s. could make in this regard, and we had a big stake in the outcome, of course. not only tens of thousands of americans in the area potentially affected by the nuclear problems, but also our

mutual stake in safe nuclear energy and making sure that we could manage this issue as effectively as possible. and indeed that became the center of our efforts. the fir ten days, frankly, were quite chaotic. there was lack of clarity on the japanese side, who was in charge. lack of information. we had trouble coordinating, but after we got through that, a task force was set up. the coordination began to work effectively and that coordination continues to this day. so in those three areas, i think we did a pretty good job. quickly, lessons learned. first, and most heartening, was the tremendous amount of good will in both countries toward the other. the outpouring of americans. $22 million. the number of former jets that

reached out to their former communities to help, the number of alumni of u.s. forces japan, the families that served there, the strength of human bonds between the u.s. and japan that had been under the surface, really came to the surface and was heartening, and a reciprocal feeling on the japanese side. the warm response to the efforts made by americans. so we're in a situation where more than 80% of the people in japan support the u.s. japanese alliance, an historic high, and it's important to build on this good will for the future. second, lessons learned on responding to disasters. a good job together but a lot more we can do and we need to do a lot more joint training and exercise and learning how to reach out to other countries. talking about perhaps regional responses as well to bring people together on humanitarian disaster relief. and, third, and perhaps the most difficult challenge of all, us how do we put together in both

countries, an energy policy that brings the need to develop efficient use of fossil fuels and environmentally friendly use of fossil fuels, work on stimulating more renewables and making nuclear part of the mix. nuclear energy is under crisis because of lack of public support around the world and the u.s. and japan have a lead role to play there. >> rust, thank you so much. sheila? >> i am like my colleagues on the panel -- unlike my colleagues on the panel i'm not a government official, so i thought i'd just offer a few observations i have had over the year. one thing i think everybody in this audience appreciates deeply, but one of the greatest assets of the last year was the opportunity we all had to witness the resilience of japanese society. i think it's deeply felt, not just in the united states but around the globe. japan's response to the triple

disaster, this unprecedented crisis, was remarkable, even though there's critique of specific moments, specific decisions, specific institutions, overall it was a tremendous show of the japanese social resilience. there were tremendous acts of courage by individuals but also japan's social institutioned that shined. volunteerism was at its highest and the energy crisis that occurred, but i also saw local governments responded well, and many of the inconstitutions we haven't seen in postwar japan be particularly strong, nongovernmental npos, were at the forefront of response. i also took deep confidence in the fact that it was younger japan. it was the next generation of japanese leaders, the faces we saw in many of the speak office

last year's response to the crisis is most heartening to me as an aid indicator about ''s future. the other point the ambassador made is the scope and scale of the crisis was unprecedented. a 9.0 earthquake, the 45-foot tsunami and then the nuclear meltdown, but yet all of us who live in societies with nuclear power and societies with repeated and much expected natural disasters, have an awful lot to learn from the japanese response. i you haven't seen itey, jeff bader's article will give you an interesting insight into the white house response and i think in japan, there's an awful lot of critique going on right now of ''s own government's response the crisis. i caution all of us outside the country to give it time for the

empirical analysis, the political analysis, and the scientific analysis to run its full course, because these are the kindses of challenges and problems all of our societies will face. the other piece of this that is not specific to march 11th 11th events as well-but those who watch japan realize you have to put march 11 events and this last year of reconstruction in the context of japan's broader public policy agenda and that's where many of us are hopeful that some of this new analysis will come to light, but we also have to understand that the global economic conditions confronting japan today, all of us, including the energy market, are going to determine the extent to which japan's recovery will be successful. the fiscal health of japan is a topic of great person. prime minister notah is addressing this as we sit here today but japan's larger task of rebuilding in post march 11 japan are about building a

society and an economy that will be more globally competitive going forward. one of the aspects of japan's response that gets most attention -- and i write about it because i watched it carefully -- is the extent to which japanese institutions met the challenge. i'm not here to catalogue mistakes or lay blame but i think japan has gone through a very protracted political transformation, one that is not yet over, and we have yet a lot to see about how this crisis is going to affect the transition itself away from single-party dominance into more of a competitive political marketplace in japan, and the institutional prescription you heard discussed in japan are going to help in that transition process. very broadly speaking, though, the japan that i see, especially

the public policy debate in japan today issue think reflects a much more deeply -- some people like to talk about an unsylar '. you see a much more reflective japan, a japan that is much more willing to ask questions about institutions that have not been examined so closely. the nuclear field, of course, gets most attention but i think there's broader questions about relationships between local and national governments; about corporate-private sector partnership choices that japan has ahead of it and i fine that one of the great opportunity that has emerged in the wake of march 11th. let me conclude with a couple of thoughts here, especially those of us outside of japan. and that is it is absolutely important that the lessones learned process of studying what happened in japan on march

11th and afterwards is not just japan's exercise. it must be not only a u.s.-japan exercise but a global exercise because all of our societies will depend on what we learn from the events in the aftermath of march 11th. the next cautionary issue, it's equally important to recognize what japan did right, both in the early days after march 11th and then in the months since. there's much to be learned here and i think what japan did right is as important. finally, and this is from the global perspective, and clearly washington are perspective -- i think it pertains to the regional response to japan's crisis, and that is the strong japan is what all of us will depend on. japan's recovery has immense implications the global economy, foe the stability of

asia-pacific relationships and the partnership with the united states. we can't imagine a future in which a strong japan is not part of the future so i think our policy team will work very hard to support and sustain the kind of cooperation we have seen over the last year to make sure that japan reemerges. thank you very much. >> she los angeles thank -- she, thank you. and, marc, maybe you can talk about whates going on today. >> thanks very much. i'm happy to be here. i'm glad sheila mentioned this idea of an insular japan as we heard from the ambassador about the daunting challenges japan faces, and one shouldn't be surprised one of the common narratives out there about japan, both in the region and the world, is that japan is just more focused on dealing with issues at home. it's naturally going to be more

preoccupied with addressing pressing domestic issues. i want to make the argument that in fact japan is as engaged as ever on the international stage, with the united states and with its neighbors, and so i guess i would add, ambassador gave us seven ps and i would add an 8th and that's pro-active. japan is remaining pro-active in the international community, and contrary to some of these conventional wisdom out there, is not in fact creedded its ceded its place on the international stage. our global partnership with japan is succeeding and making headway in any number of areas the united states is focused on. afghanistan, for example. japan is the second larger donor, five billion dollars and five years and is poised to host

a major donors conference in tokyo. same with iraq, i think japan is something like $5 billion. but second after only the nuss only the u.s. in terms of its financial support for the country inch terms of other pressing issues, iran, for example, japan and the united states share the goal of the abandonment of iran's nuclear program, and japan is participated fully in the u.n. sanctions as well as implementing unilateral sanctions of its own, and this in spite of the challenges it faces at home in terms of the energy situation. north korea, burma, both countries which depend on the u.s., are in close daily contact to address the issues there, whether it's the missile0s the issue of economic liberalization. in terms of specific security alliance with the united states,

won't go into too much as ambassador demming described, it's the immensity of what the u.s. and japan undertook post 3/11. i will say that what 3/11 really did for our two countries and our alliance, was to knit us to lash us closer together. when you have two forces such as ours going shoulder to shoulder into harm's way death -- way together, its an experience both forces never would have duplicated on the training area or on a strategic table, and i think we'll see the fruits ahead as the two countries perform even better and more closely in terms of joint and other operations. economically, i'll be brief. i don't think this is news but the u.s. and japan are vitally interconnected. that has not changed after 3/11. japan remains one of the top

investors in the u.s., and u.s. is the number one investor in japan, japan is our fourth largest trading pardner, and as we pursue engagement whether it's trade, investment, or science and technology cooperation, cooperation on things like environmental protection, fighting infectious diseases, promoting cooperation in space, you name it, areas in which our researchers and scientists on a daily basis are working unabated and 3/11, if anything, has drawn us closer together. real quick in concluding, i would just raise one issue of concern to me permanently, being -- to me personally, being the beneficiary of a student exchange program. that's the number of students from both our countries in each other's countries is relatively low, and i think we can do better. there's 6600 american young people in japanning renow. i think it should be twice that, three times that. right now there's 25,000

japanese young people and other researchers here in the u.s. that number is on the decline japan used to be in the number one sending of countries to the u.s. now it's fourth between china, india, and south korea. the fact we're all here today means we care about the relationship would implore all of you to do what you took reverse the tide of both countries. our goal is to create a total generation so using the spirit of what we achieved together to help bring even stronger bridges between our two countries in the years ahead. >> thank you very much. [applause] >> we have just under 20 minutes for q & a. ask brief questions and identify yourself so we can get as many in as possible. i'm going to take the moderator's privilege and ask the first, if i can. i'd like to ask rust to compare

what you saw happening after 3/11 on the japanese government side with what happened after kobe in 18995. a -- in 1995. one of the ambassador's ps was preparing, to be prepared, and the devastating kobe earthquake is one in which there was a whole host of different circumstances, and i'm wondering if you can give your perception to us of -- did japan do better, worse, or unchanged? >> i think there was a mark contrast. i happened to be in tokyo in 1995 during the kobe earthquake and japan was completely unprepared. and they wanted to keep the self-defense forces out of the prefecture. there will no regulations in place to allow self-defense

forces to control highways or take emergency actions. and that, look with the gas attacks of the next year were a major impetus in japan to putting in place emergency legislation, a process that began under prime minister hash moto and continued -- has continued to this day. so japan's emergency response was better, self-defense forces did a tremendous job. there were more than 120,000 self-defense forces mobilized to go up to the stricken area and they did a tremendous job. not just the self-defense forces. people may criticize the management, but workers were putting their lives at risk, going back into the reactor. the tokyo fire department, put water on the reactors and very

horrible conditions and as others talk about the outreach of the japanese. so it was a much better response and we need to be very cautious in our criticism of how japan responded because of the crisis was unpress departmented, -- unprecedented, a triple crisis, and they did a much better job than in 1995 and learned a lot of lessons. >> let's open it up to the audience now for questions. start over here. >> thank you. ambassador demming, you touched on this briefly on energy policy at the conclusion -- could you talk about the future of japanese energy policy, the japanese ambassador gave us some unsight on public opinion toward nuclear power. how does one reconcile the public opinion with japan's --

>> it's major challenge. one can certainly understand the public emotions after this event. and the problem has been that these reactors go off cycle every 15 months on regular basis for testing and maintain, and as they've gone off cycle since march 11th they have not been able to come back on cycle because local governments exercised a veto over that. seems to me it's matter of political leadership, both at the national and local levels. nuclear in my potential of view, is indispensable in the mid-term for '. before this crisis japan was aiming to have 50% of electricity by nuclear by 2025. that cart is gone. it's not going to -- whatever substitutes for nuclear is going to take a long time to develop. so there -- not just in japan

but in super the u.s., we have to overcome these obstacles and my understanding the new generation of nuclear power is much safer, and the problems that developed would not develop under the new generation nuclear power. >> one of the crisis in terms of the loss of energy production was as severe because of voluntary reductions by businesses and individuals. you look at this sheet 10, i'm not sure if it's kill la out -- mega watts -- you can see december 10 to december 11, that's decreased. that's not normal economic production you. don't want it to decrease. so there's already been a voluntary one-year drop in usage. whether that can maintain when nuclear is now only providing 7.3% down from 31%. this is a significant issue that i don't think there's quite yet an answer to but we should

recognize -- sheila can chime in -- the strength of social structures, this probably saved -- certainly saved japan from rolling blackouts and saved it from what could have been the government having to be much more heavy-handed in determining who would get electricity and who wouldn't. other nonelectricity questions. if we have in. yes. in the back. >> thank you very much. did you on american side, need the government agency of japan open -- france what is called -- this crisis revealed the power of japanese technology in using energy rather than talking about whether we use nuclear power plant. is there more awareness and better knowledge in u.s. about

japanese technology and using technologies, whether for consumer, industry, and so on? >> thank you. i am happy to take the floor but i'm not sure i can answer your question effectively. one of the large pieces of learning, if we take it back to japan, is the extent to which the japanese social response could be imported, if you excuse that use of language. i'm not 100% sure i understand yet how thoroughly industries are learning from fukushima. to add on the japanese, a case about japanese's future energy mix. the 2010 energy policy has been abandoned, the policy ambassador demming was referring to. japan is no longer committed to 53% nuclear power and is not excited to sustaining current levels. so, there's a short-term problem

how does the japanese economy get access to its energy needs, which in today's volatile oil markets is very difficult. japan has turned to lng imports, but container ships and the ability to transport that level of sunday nance is part of a challenge. the long-term concern about the energy mix should come out with the advisory committee studying the question should be out in a few months. massive investment in renewables and the cities of the oversight reform of the nuclear power energy, the stress test, explain ing carefully to local governments to ask for their support in turning these power plants back on. without local government support, you're not going to get nuclear energy at any level in japan. i doubt you're going to get

5u8 4 reactors back on line but you must get some of them back on line to navigate the short-term needs. >> a question right here. >> thank you for being here, i want to talk -- i think you all mentioned when these disaster happened, just how it built momentum between the relationship between the u.s. and japan, and made the two countries tighter knit. how has this helped in terms of the security alliance? specifically in terms of the fukushima issue, have we gain momentum on the issue? where are we standing? thank you. >> turning to me. thanks. that's a great question. i say that real iny in the midst of this historic visit to asia that secretary clinton described and others have talked about,

this would be impossible without the kind of critical alliance relationship we have with japan. as sheila said in her remarks, the u.s. japan alliance is critical to stability and security in the asia pacific region, and we need a strong japan. the united states needs a strong japan. we need a strong alliance to carry out the kind of goals that we and our friends and allies in the region share, and so when it comes to things like -- the close and cooperative relationship with enjoy with japan has been and will continue to be absolutely key to moving forward in the future. >> can i ask you also, sheila or rust, about the public perception of the self-defense forces after 3/11? japan obviously has had a conflicted relationship with the military, constitutional restrictions, call the

self-defense forces. they played the crucial role of -- not for a day or a week but for months. has there been any public opinion polling done to show how people look at them now? >> i just saw some numbers recently. i think 93% of those polled supported the roles of the japanese self-defense forces in the arrive and rescue operation. so i think the answer is a resounding yes. the japanese people have welcomed the role -- not just the sdf but first responsibleer, policemen, firemen, who ran in as others ran out as the expression goes and it does herald a new chapper in public perception of the self-defense forces. >> a very brief followup i think the japanese texas -- if you were watching the crisis in real-time, one of the things that was fascinating was the role of social media, twitter

and et cetera. people were commenting on what was unfolding after march 11th , and the social media commentary on the self-defense force and other first responders was astounding. for somebody like me who watched the debate on self-defense and the constitution and the bilateral relationship i was impressed how deeply the public appreciated the heroism, the bravery, and the capacity, and i think the ambassador was right to say the u.s. was there to help and assist in that tremendous task bit just caution those of you -- you asked about stenmar. i think public attitude toward japan's military doesn't necessarily translate into this base or that base support. so, this is a difficult problem. it's going to be a difficult conversation. i think both of our governments have already demonstrated a certain flexible in the

discussions going forward. but again, this overall good will that you sense in japan towards the self-defense force may be something that we should be thinking about in terms of future conversations about u.s. forces and japanese forces working together in the region. >> good questions. right here in the middle. and then up in the front. >> name is it a -- isabelle. >> i appreciate your arguments about japan turning. can you make more comments about japan's global engagement and international contributions or development assistance. thank you. >> i think most recently we were very heartened by the decision by the prime minister to

dispatch ground support engineers to south sudan, and this is following on to operations they have currently in east tim timor and the golan heights and the floods in pakistan, as well as to haiti. so it's a welcome trend. japan's engagement internationally and again stepping into harm's way in support of the wildlife the -- support of the will of the international community. so hopefully something we'll see continue. >> also, i think this has not gotten a lot of attention but japan has become active in antipiracy for the first time. they have a small facility with p3c aircraft and marrytime self-defense forces there. this is unprecedented. it's a police action. not a military action. but another example of how japan

is cooperating on issues of great concern to all of us. >> a very brief followup on about oda. in the weeks of march 11th, a great concentration on japanese fiscal resources and certain people were beginning to argue the oda should be cut so they can be focused at home. and others strongly resisted that impulse. it's natural but they resisted. it's also -- so much evidence of how much the global response to japan was in part due to the extent to which japan had engaged in disaster relief activities abroad, even in places like kandahar, as doctor likes to tell people, people raised now give the japanese victims of march 11th. so there's been a general understanding that japan's oda at large has been an asset to japan and it's a role that japan plays to tremendous result around the globe, not only in

terms of disaster relief but just in terms of ''s own influence globally. >> we have three minutes left but i'd like to get in one last question. robin. right up here. in the middle. >> robin bearing ton, retired foreign services over. some of the reasons for the decline in the exchanges between the u.s. and japan, are reasons we have often hear. america is scary, america is expensive, american corporations don't value mesh education. et cetera, et cetera. whack we do encourage more japanese to come to the united states? >> well, i can start that one off. right now we have something called -- it's essentially an attempt to build on the good will built between the two countries and this is an effort,

public/private partnership in which we focus on young people from the region, and through things like sports exchanges, educational changes, cultural exchanges, entrepreneurship exchanges, to look at the united states as a place they can study and help fulfill their dreams in a post 3/11. a lot of people have lost their families and a lot of -- it's been heartening to see them react to the program and see it as a way to help fulfill their dreams and generate hope in their lives. >> we're out of time. i'd loaf to do more but i want to thank all of you for coming and spending time with us today. and join me in thanking our panel. [applause]

>> i hope as we move forward in this world there are a number of problems we have to resolve. problems in darfur, peoples republic of china, iran, and i think diplomatic solutions are going to have to be the answer in the future as we start to

deal with the problems coming. >> the national u.s. arab chamber of commerce hosted a forum looking at the u.s. arab commercial real estates. 13 u.s. ambassador from across the arab world gathered to discuss the political and economic situation in the region. career ambassador thomas pickerring gave the opening remarks at the two-hour event. [applause]

>> thank you, don, for that elaborate but succinct introduction. i know we're process for time and i will only say what a pleasure it is for me to be here to join arab ambassadors from the middle east and american am booths from the middle east in this important forum. my congratulations to the arab american chamber for its work in working hard to balance what has been a very unequal situation with respect to the region and indeed to the work of organizations dedicated to the region in this capitol. it's a delight to see you here and share with you any interest in the middle east. i come with more than a little bit of trepidation looking at the array of experts to, to talk about issues i care about in the region i had the privilege to be the first member of the schizophrenics club.

that club are those american only boors who served in an arab country and then in israel and you'll understand the origin of the title. but even schizophrenic have enemies enemy sos so i have to be careful. i have some concerns that may be impalatable, and i'd like to talk to you about some ideas that i think will be helpful for the future. certainly from the vantage point of someone who used to follow these events very closely and still remains very much involved in thinking about the future of region and the hopes we have for the region in terms of peace and security, which sounds not unlike kumbiya diplomacy. my sense is that if you have only 15 minutes to spend you ought to spend it on the change in the arab world and i'll dot that, and a little bit on what i

see is the discouraging lack of progress in the arab-israeli peace processes. if there's a moment or two i want to give you thought on iraq and iran but that will have to await, and in fact the tyranny of the clock, if can put it that way, because i get transported from the podium in a silver coach in 15 minutes, i'm told. it's most important, i think, for us to understand some things i would characterize as bullet points as i see it in the change that is now taking place in the arab world. i think its here to stay. two i think it's significant. three don't know how it's all going to come out and if anybody professes to know sew, the ought to be elevated to a pedestal or sent to the loony bin. it's a difficult and trying question but i don't think things are going to role back.

the arab world has spoken and a very considerable effort mobilized against corruption, and against one-party states. where they will come how they will succeed still remains an open question. for me in looking at the situation in the region, one has to continue to be attached with the traditional american view that egypt is a very serious and important bellweather. i don't see egypt as resolved in any way at all and i see egypt as kind of a sparring ground between the egyptian military and islamists, particularly -- and how and in what ways they will be able to colder nate their work in the future of the country or remain apart. it's part of the track that people brought change in tahrir square havees chewed leadership in their moms perhaps as a

security protection but now seemingly taking them out of the range of being able to be part and parcel of an electoral future with egypt, which is something i think of a tragedy, if not a central one, certainly one that in many terms is going to affect the future of the country unless that is reversed, and there don't seem to be signs of that happening. i think that many of us can be delighted and pleased with changes in teunis, and the monarchies present a different situation. my along association with jordan and the privilege of living in morocco, leads me to believe they're the most taxed and capable of showing the most reveil generals and capacity to adjust to new changes. the gulf, think there's no question at all that attention has been piqued and sparked.

there are large efforts on the part hover the gulf states to use their considerable resources. i would not include bahrain in the really guardedly optimistic view i have of the adjustments in that part of the rpi region, i income nevertheless there's a start that has been made and how and in what way they respond to the needs and the economy and the needs for social change and, more importantly, the needs for some political change, remain open questions and whether indeed the short-term and medium-term effort they have undertaken will see it through. yemen and syria are serious and important challenges. for yemen, i hope that we avoid the process of becoming another somalia. in libya i'm deeply distraught that regional differences and tribal differences differences r differences have seen more of an effort of a sin tariff cal character than a centrifugal

character as the new libya seeks to emerge in syria, one can only watch closely and hope that the evidents now underway will bear fruit. let me talk a little bit further about syria, because i think that as a major player in the region, a country of significance and a country certainly on the verge of becoming almost a genocidal state. we have great reins to be concerned. i'm very please an an kofi annan is engaging in ant evident which undoubtly hadiths pay first attention to the question of negotiatings and whether they can produce a useful result. the early aspects of this are far from encouraging and far from clear. but nevertheless, it represents an important step, and i was pleased to see over the weekend that the russian foreign minister and the arab league came closer together in their

own views as to where things might go. certainly the notion that bashar al-assad should remove himself from syria as a prey condition has every feeling of correctness in direction and purpose. oregon -- on the other hand to demand that precondition 0 as a requirement before negotiations can start is unfortunately in diplomatic terms for me a reach too far and i think we have to come to grips with the notion, as indeed i think the arab league did in cairo, with an effort to try to start it without that. i think concomitance for a success have to involve almosts such as making sure that all parties in syria are represented in the negotiations, and that indeed they are represented in a balanced way, and they are committed to change in a future for their country that

represents the best interests of the people of syria in the sense that they are demonstrating those interests in the streets of syria. even at the risks of their lives as we speak. i think it is also important in achieving that kind of a political consensus, to take into account that certainly one has to make provision, particularly for the minority, which is not necessarily been the gentlist factor in recent syrian history in its role in governance, have to be protected against the notion they will become the victims of genocide if in fact they make a move. and the international community has to undertake something of help in that burden. it is undoubtedly true that kofi annan's first instincts for a cease fire are important. whether they are bear fruit remains an open question but the kills has to be stopped in some way. it's a tragedy mounted upon a tragedy. we also have to look to the

humanitarian aspects of syria and the efforts that can be made, whether it's safe havens or corridors or international support of food and medical assistance, or all of those questions. i despair of the notion that military force at the present time can make the kind of change that we expect to see. we have had our own experience with military force as a subconstitute for diplomacy in iraq and elsewhere, and i have to tell you, my frank view is that the results, in no way in my sense, are quite the efforts put in to make that happen. the fact is that we need to exert all diplomatic efforts certainly backed by our considerable power as the world's largest economy and the world's most powerful military force are but coupled with others playing on the international scene.

certainly we all should take note of the fact that the arab league has emerged from -- to a new and forceful role in the region and that needs to taken into account. and the role of the arab state. and while many me a believe that they are seeking only narrow and particular advantage, i have great sense that they're adding to the equation for the future. let me turn from syria to its nonneighbor, if i can phrase it that way to israel, palestine, and the arab-israeli question. in all frankness i'm terribly discourage. we can expect little movement from the united states certainly before the elections take place, and my hope is that this stasis

will be requited by a serious effort following the elections. in the meantime we're prisoners of what i used to call in the region the bicycle principle. if you're not riding forward, you're falling down, and anybody who believes the status quo is either permanently maintainable or necessarily going to even keep the situation on an even keel, has always got to reexamine history in the area. it's a very difficult and dangerous time and count thing status quo to continue is, in my view, a pious hope over the stark reality in the region. what can be done in this intervening period is important. i for one have long believed that we ought to find a quiet way to help the palestinians pull themselves together. and by that i mean quite seriously that hamas need to continue their talks to come together. i was ambassador in israel and

had the unenviable opportunity to call prime minister shouldmer on the evening we decided to talk to at the plo. you need to cast your minds back to that particular period to find a period when indeed our animosity and our unhappiness with the palestinians was overcome. not because the record had changed but because in fact the posture had changed. hamas is far from going to lead the negotiations. but i think its posture towards the negotiations is shifting. we will not expect hamas to recognize israel. but they have in interest some ways begun toes chew violence because they know it gets them nowhere, and while they will not accept immediately the notion that everything has been agreed on the table is going to be their cup of tea, they have accepted the view, at least this is what they say and they need to be tested -- that if they can

negotiate a deal and that deal is supported in a referendum by the palestinian people, they will be there. these are moves. they're not the answer, but it's important, and the palestinian side, negotiating in two separate halves is ultimately, on my view, unable to come to grips with the notion of a two-state solution and peace for the people of palestine and that needs to be pursued ahead. the second thing the united states taught be -- ought to be thinking about is parameters of negotiations and the president took important steps when the said the 1967 line should be the basis for the future and it should be the basis for swaps, and i hope he meant equal or nearly equal swaps for fair treatment to arrive at a solution. there are other things that can be put on the table as parameters. jerusalem divided by neighborhood with the two parties settling on a regime for the old city that at a minimum

permits access and certainly access to the religious winds of all. -shrines of all. we need to add third-party assays tenancy to match israel's need for security in the region with palestine's need to have its sovereignty full and fully recognized and i believe the united states could play a leading role in that kind of an endeavor. ...

now that that's the objective will be very significant in my view in bridging this difficult that over the period of time when the bicycle is peddling against us. it's been interesting to be with you we and i will only mention two other things. i.t. i share a concern that all share that iraq is less than fully stable. they still have problems of an fact coordinating majority rule of minority rights, and indeed the nature of the federation whether it is of 18 provinces or three units, and indeed how to distribute. finally iraq's role in the future of the region not only from the inside as a major

player but indeed from the outside the of players in iraq indeed differences and difficulties are maintained among the groups inside iraq that continue to contest for power in one way or the other shia, sunni and kurdish. in iran it is worth a whole hour alone to talk about the future of iran. my own sense is there are only two big problems to be resolved and the horrendous. what to do about the nuclear question and what to do about all the other differences beginning in afghanistan that we have with iran. my own sense, and always remain an optimist otherwise i too would be infil loony bin about the future of a nuclear equations in which we can get iran will only to say it renounces the bomb but to act in ways that are fully complying with that. it is important that we use the leverage on our side to do that,

and those are important. we badly need more cable will inspection by the iaea. it is the one safeguard we have in iran's not creeping over the civil war and into the nuclear arena and we need to use the sanctions long just to bring iran to the table which seems to be having some success, but to induce iran to understand that its nonnuclear future in the weapons sense is the best and the most useful posture in the days to come. i suspect i'm almost over my time. it's been terrific to be with you and i think you very much for giving me this opportunity to share some ideas and views and i wish you all good luck in the panel's ahead. thank you. >> thank you, ambassador for that. it's very interesting. we are going to convene now on

our first panel in full attendance, and i think perhaps should we start at the end with ambassador gray and if you can give five minutes of the introduction then we will start with our q&a. >> agreed. thank you very much and thanks to all of you for coming this afternoon and i want to thank our hosts and particularly david even though he couldn't be with us today to previous commitments overseas. - gordon gray, the u.s. ambassador to tunisia and obviously 2011 was the year for the sound political change in tunisia and in addition to the changes came the realization of the importance of the job creation to the success of the transition in tunisa and this led to the further opening of

the tunisian markets to the foreign trade and investment because without the opening of those markets and the easing of regulations, jobs simply are not going to be created to the degree that they are necessary. one of tunisian as the advantages for investors who is its location. it is within close proximity of not only north africa but also europe and sub-saharan africa. obviously with a population of just over 10 million people, it is not an overwhelmingly large market for u.s. goods, but it's regional platform is very appealing. it's also the only country in north africa that can trade with all of its neighbors and its party to other trading agreements such as the agreement

that allows it to trade freely with egypt, jordan and morocco. this means that there are several opportunities for the u.s. businesses. there are more than 80 u.s. companies now. some of the company's present have had success in the i.t. sector, manufacturing also and some of the exports to the u.s. companies have made include things like oilseeds, cereals, machinery, chemicals and the like. looking ahead as far as opportunities for the u.s. companies, infrastructure is very important and very much needed. a large scale tourism projects, industrial megaprojects and these include things such as highways and railways, tourism complexes, phosphate plans and

others. franchising is another real opportunity for u.s. companies because we have such a competitive edge advantage and because there is a large middle class, and for all these opportunities that i've mentioned, the overseas private investment corporation can help u.s. investments. the of the 2 billion-dollar fund for the middle east and north africa and the year eager to spend some of this money into nisha. we just had a team from opec visit at the end of last month with a particular eye on franchising opportunities. i am mindful of the need to keep the panel going, so i will stop now and allow time for questions and answers after my colleagues give their presentations. but we do have an information sheet. there's some of the back of the room and i also got some copies and i also have the business part of our commercial attache

if anyone is interested and want to get in touch with her. blank very much. >> blank ambassador great. i'd like to turn out to the ambassador kaplan. >> good afternoon. it's been a great pleasure in serving in morocco, a country like some of the other countries involved where its stability is the greatest claim to fame in the business world. when you consider all that has happened in the arab spurring and realize how little the impact has been on larocco in terms of its stability and in terms of its health, it's very impressive. i was sitting with my wife at lunchtime today and i was saying what is the principal thing that morongo has going for it and without batting an eyelash she said it's the morocco brand, and

that's true. this is a country that has been built in a very significant way on the basis of tourism, and you will go all through the united states and you will find all kinds of people that know very little about the politics in the part of the world that are currently served, but they will tell you they have been to morocco or read about morocco or they know about morocco, and they know about this welcoming quality and about its positive feeling of its people. i frequently say that the first two words that a dealer named english or your welcome. you're welcome into our house and into our business, you are welcome to our country, and i think that that is a very telling factor. to be sure, the arab spring has had a very positive affect in that there has been a change in government, changing constitution, and now you have a coalition and the government headed by a man who is part of a

real political party that organized in a way that said that this country could have reforms in a meaningful way. his majesty is still the most powerful figure in the country, but is doing so acting in a manner that is consistent with the sharing of power of the government. so briefly what you have here is the opportunity for american companies to come in. we already have 150 or more in the country. they do very, very well. we have a very strong central bank and understand what you're doing and the nature of commerce in the country, and i think it is a very powerful thing. are there concerns? of course there are concerns that all of the reforms will not turn out in the way that you would hope. but i think you can set that aside for the purpose of this meeting today and say that there is of real optimism.

>> krajeski investor. i would like to turn out to the ambassador cretz. >> libya is a little difficult. >> as secretary clinton said last week what a difference a year has made exactly one year ago. we were working on putting together an international coalition to do with the brutality that marked off the was visiting upon the libyan mission and one year later we just experienced a tremendously successful or wind trip by the prime minister of libya, mr. abdul, which resulted in the renewed commitment on both sides to pursue a new and close relationships partnership with each other in every possible sphere. if you've read the newspapers had lines of the last several

weeks, you get the sense that libya is a country beset by militia fighting each other, tribalism, an economy in tatters, regional flare ups, etc.. even -- there are challenges for sure and the government acknowledges there have been mistakes in its public communication and the way that it's pursued the issues of transparency but i would argue one should also look at the positive things that happened. over the past four months if you saw the prime minister and any one of his venues you have seen a man who is serious, dedicated, committed to human rights, committed to a space libby and his cabinet very much reflects

his personality. civil society is a burgeoning, political parties are exploding all over the place. you can't go to light in tripoli without being invited to the launch of a new political party. the election is proceeding apace, the u.n. has been working with the new commission as the law and surely there are many complications to overcome before the election takes place, but it is moving. the liquidity crisis has eased. february 17th in which the one-year anniversary people were predicting dire explosions running rampant in the streets and violence tasked without a whimper. basically families walking across the streets and hundreds of thousands of them and no gunfire thank goodness.

oil which our experts among others declared last year during the revolution that would never be up to the pre-war level one tell several years is now up to 1.4 million barrels a day out of the pre-level amount of 1.7 and they hope to be back there during the summer and are even talking about going back to 2 million by the end of the year. the budget we understand was passed today and that will begin to give the ministries the money that the need to make to do their projects, and just in terms of the commercial environment, you know up until the revolution there was 175, $200 billion worth of contracts that were given out in infrastructure from a tizzy. you name it and libya needed. it was done in a helter-skelter

manner, and right now the new government before it gives out any new contracts is reviewing those contracts to make sure they are rational and a viable and they were not subject to the corruption that violated the gadhafi era. it's a great time to come to libya. i know the situation is a little dicey for some of you. we live and work in libya, and if i can assure you that european companies are coming and that there is a real desire on the part of the libyan government and libyan people for the products and goods as it was before and the president told that specifically to the president secretary of state and it reveals he met with, so i think it's a good time for america's businesses to come and you will be welcome. q. won't get a contract your first day but you will begin to

establish contacts you will need the will stand you in good stead as the country makes its march towards democracy. thank you. >> thank you come ambassador cretz. and now i would call on ambassador jeffrey. >> thank you for a much. it's a pleasure to be here today. it's also -- we are very appreciative of what we have received from the city and the other people from the national u.s.-arab chamber of commerce including his visit to our recent iraqi trade fair. you have heard that the stability many would argue in fact what the ambassador was saying as the mock of iraq is potentially still instability and we can't deny that to some degree but i will try and a second to put that into somewhat different context but let me talk first about the business opportunity in the economy. iraq can keep its political

situation stable to explode. it has a per-capita income of about 31, 4200, which is free low even for, quite low compared to the rest of the region and even low compared to sub-saharan africa. on the other hand, its hydrocarbon reserves, 140 billion barrels known, probably 30 billion if not more in the kurdish area, plus a huge tracts of unexploded terrain in the west of the country bringing it close to saudi arabia is 240 billion of the oil reserves. and in addition iraq has unquestionably more natural gas. so in terms of hydrocarbon, it can compete eventually on the line eventually with saudi arabia, and it's got plans over the next eight or nine years to increase oil exports of two a very optimistic 11 million barrels a day. we think if they are lucky they

will get that eight or nine. but nonetheless, they've got an extraordinary process underway with 14 international companies to develop their southern fields. they've got tremendous potential in the west and many and political issues related to all of this but nonetheless they are on the move. fuelled by the increase in the prices and the increase in exports about 300 to 400 barrels last year we think 400 to 500,000 barrels next year is expanding in the double digits. u.s. trade is expanding equally from 2010 to 2011 and increased about 50% from 1.6 billion to 2.4 billion, nothing like what we are doing in other countries but anytime we can do 50% increase, we are happy. the areas of concentration of u.s. success are first of all the oil and gas sector and second, heavy equipment particularly the electrical generation to some degree

chemicals, pharmaceuticals, but in particular agricultural goods, defense obviously and information technology and telecommunications and we are also very proud to say automobiles, so there is a wide variety of american firms interested in this at the trade fair was the largest with over 80 countries and as i said, attended to represent your organization we were very happy to see that. we have again many resources at the embassy. it's a very large in the sea that are committed to both working with the iraqi economic system and the government to explore its natural sources and develop its business sector but also to work with the american business community. let me get to the hundred dollar question which is what about security and the political situation?

iraqi remains a space rule of the country under tremendous stress as it has been since 2003. those of us that have been there repeatedly over the last 800 years can attest to the fact it's a much better shape now than it was six or seven years ago. nonetheless, while the security situation has improved dramatically just in the 20 months i've been there, is it still is an issue of concern as it should be and we have a very strong sector to make sure americans are safe and for a good long time american private sector representatives have been safe. in terms of working with iraqi government there are two kinds of problems. a first of all that is a wholesale macrolevel you have difficulties with the iraqi system funding large-scale infrastructure projects. the iraqi stunt want to take out loans and there are limitations on what they can do. this makes the process basically you have to get a legislative

decision or a lot for each project, three cumbersome and it's slowing down and development. we are working with them on that but that is the first constraint. countries need to find models to fund infrastructure development putting about one-third of the 100 billion-dollar budget into the infrastructure, so is all of that a large part of it flows to the community but nonetheless, the turnover models and other creative models other countries have used our -- there is a need for that in iraq. the retail microlevel operating in iraq is a daily challenge from visas to finding the communications to communicate with your government interlocutor it is a very demanding environment but we are very supportive and the sea and we urge people to look at our web sites and to consider the iraqi alternative. there is a huge market as

elsewhere in the middle east in demand we are making the effort and i urge you to make the effort. thank you. >> thank you come ambassador jeffrey. it's been a local college to work with you so closely in iraq and thank you for the opportunity to do that. i'd like to now call on ambassador patterson. >> thank you very much. let me tell you that i am very pleased to say a few words to you because i think the economic engagement is going to be the key to our engagement in egypt because that is the area in which our interest in the new government really coincides. there's been a huge transformation in the last year or two which i might say unexpected results, 70, 75% as well as presidential elections began in ten weeks, another huge transformation under way to be the next six weeks are going to be very dynamic and the next six months are going to be very unsettling so i want to talk

about the short run and the long term, because i think they are vastly different sectors. political uncertainty is going to coincide over the next few months which really sharp economic decline is coming and i want to talk out some measures that are under way to reverse it. i think the long-term prospects for american business and all sorts of aspects are actually quite promising. the too sharp to drop in the reserves that is under considerable pressure. inflation is up, the deficit is increased, and perhaps most relevant to this audience, business problems have soared because it is very difficult to get paid by the government, people are reluctant to take decisions. there has been talk of reversing privatization and i.t. this will begin to settle down as the new government comes into office. there is a lot of caution on the part of our investors, particularly from the gulf. the observation is american investors and people doing business in egypt have been less

hit with some of these problems and those from other countries. the good news is the imf is getting ready to go into egypt. i think each of will be able to raised a substantial amount of the foreign-exchange and require the stabilization program and the momentum should begin to turn around very quickly on the economy. i took a lot about the city bank report that indicated egypt should be one of the top ten economies in the world and next-generation and that is probably true. we are going to have a difficult period over the next few months. the long-term indicators are good in 2007 egypt had over $10 billion of the direct american investment and it's down to about 1 billion this year. but i think it will recover government i think is very

important and it has reached out to us repeatedly to make the reassurances about the commitment to the free markets and the commitments to the level playing field with america and other foreign investors. the heavy market orientation, and they have been careful to reassure us on issues of corruption this will be one of the first issues they are going to tackle. there is a strong domestic community and eject the stand a little shell shocked and what's happened but i think they will recover and play the role that they have always played. dirty strong business community for those of you that are looking for partners. we see large opportunities over the next few years the telecommunications is still slow and 40,000 people so there's an infrastructure to build on in the telecommunications industry.

we anticipate the power generation will be another area of dairy substantial growth and infrastructure. the infrastructure in egypt is very seriously deteriorated and the new government has made a pity to every indication they are going to invest heavily in infrastructure. there will be a substance of infrastructure light rail to save the modify the subsidy it will become more attractive and will require construction and transport equipment but again our embassy is provides good services to american business. we are eager to help you in these areas and please, get in touch with us because we think that there is a lot of long-term opportunity there because of the underlining demographics and strength of the business community. thank you. >> thank you, ambassador

patterson. i just want to say how just with regard to as the participation in iraq and libya certainly egypt how appreciative we are as americans of you being there and the incredible service and dedication required to do your jobs, and on behalf if we don't get an opportunity leader on behalf of all of us in this room might like to thank you for your service to the united states. [applause] why would now like to call on ambassador krajeski of the u.s. embassy of bahrain. >> thank you for the match and thanks for being here it is an honor to be here with such colleagues as jobs are much more difficult than mine house in bahrain. i think if any country deserves or might deserve a do over in

the events of last year would be in bahrain. if you look at the situation before february of last year, bahrain as a model of stability, prosperity, it was a great place to do business. they've succeeded in diversifying their economy beyond petrochemicals, building a diversified manufacturing banking, financial service sectors and creating a moderately vibrant middle and working-class in 2010 bahrain was ranked 43 of 184 countries on the world bank's doing business index of the regulatory environment that was conducive to investment and business development between 2002 and 2010 bahrain succeeded in tripling its banking and financial-services sector to more than $225 billion attracting 152 offshore banking units and representative offices

including many american businesses. 2006 we negotiated a free trade agreement with bob crane, one of the few such agreements in the middle east region, and since 2006 the volume of bilateral trade has risen slowly but steadily. but political security realities have eclipse my focus on business and the economy in bahrain. in the recent civil unrest continuing unrest has weakened the economy and has presented it with a series of challenges that are profound. today it faces a drop in the tourism revenue particularly among the saudi visitors, businesses leaving the country, lost investment opportunities driven by the perception that unrest has affected the business climate, the credit downgrade and the cancellation of some

major revenue generating even as most particularly last year the formula one race. if they don't reach the political resolution, this climate could continue to stagnate causing rising unemployment and even deeper economic decides in the country. unemployment and underemployment, economic hardship or the future without a political resolution and while the reasons for the recent unrest are complex, they need economic growth in order to address some of these grievances nonetheless, ambassador pickering said we are all optimists and i am optimistic today about the government of bahrain and the ability to overcome the challenges that it confronts and realize the

potential again and we are working with them from all segments of society to seize that opportunity. we are advising several steps, continued diversification away from the petrochemicals using of the free trade agreement to promote bilateral trade volume and increased participation in the economy from all segments of the society. implementation of political security sector reforms will address many of the rich causes of this on rest. finally, i want to underscore that while this is a dramatic transitional period of bahrain, there are important investment opportunities out there for you and i would repeat i am confident and optimistic that the government of bahrain knows what it has to do is in the process of doing it and will succeed in establishing greater stability both political and

social to the island which will enable economic investment to return. >> thank you come investor krajeski. and our final speaker on the panel is ambassador ensher from nigeria. >> thank you very much. the thing to do here is to start with good news and bad news. the good news is that algerienne reminds me a great deal of my home state of california. the potential is vast and the mediterranean climate like much of california, it's about the same size population, it's a larger country and has a highly educated and the first population and also has an effective security force and a lot of money in the bank's summer between $180 billion to two injured billion dollars in the bank that's in cash and a demonstrated willingness to spend at.

islamic that is on the good news side from the perspective. the bad news side is much of the algerian economic policies seem designed to thwart the fulfillment of the. there is movement, progress, an increasing number of companies coming into algeria outside of the traditional hydrocarbon sector that includes increased american interest and one can certainly see the huge potential for example the pharmaceutical areas would point to ongoing defense articles, high end of defense articles of various sorts including those used for the surveillance and reconnaissance there's a particular ongoing issue having to deal with a conflict of u.s. law with algerian concern for sovereignty that remains a significant issue that again we are working through and i see signs of progress there.

finally may be just because i am from california i would cite the potential for the agribusiness as well, so, a lot of money to be made in algeria not to sound much like one part of the u.s. political government would get out of the way a little bit finance would rapidly improved. when we think about ways to do business in algeria, the area there is the most potential, we tend to think about a sort of three part the xin diagram this would be an area at which the algerian people really want what ever it is the government is willing indices strong reasons to do whatever that is and we the united states are good at almost uniquely good and that is where you get into the aretas like pharmaceutical defense, agribusiness and communications. so those are the three major

areas of potential and the major issues. when we decide how to spend our time at the embassy we focus on security cooperation, which is deep, broad and growing in both directions i'd say it would be increasingly important for algeria to play a leadership role in addressing the growing security threat in the events i will use that word in libya and the potential for the development of the sanctuary particularly northern and this would require algerian leadership because it is the country that is posed to act in that area if necessary and with the support of the u.s. and other foreign partners. we are interested in expanding and commercial relations outside of the hydrocarbon area while maintaining a privileged and

historic position in the hydrocarbon and finally we are there to reach out to the civil society both because it is a policy objective on its own which we support the democratization and human rights all over the world but also because if there is a continued and a significant change we want to make sure we have friends throughout the society so we are very aggressive in broadening our context throughout the algerian civil society and then finally i will mention the fact of the couple of elections cycles. may 10th as for the parliament there is a diversity of parties we would expect such would be heavily observed by the international community and the algerians to be free and fair and produce results reflecting the new political realities in the region to put it that way. and then there is perhaps even

more local elections in the fall which will decide the control over the algerian come demint these and the municipalities. i will stop there except to say that anything that i've said from ambassador oats fathi my friend will clean up afterwards. [laughter] >> thank you. now we've got several questions as i could just begin to plan to close and unfortunately by our strict schedule we have all of 15 minutes so i'm going to hopefully be able to time that a little bit to the great detriment to reflect to the questioning if i could. ambassador cretz these and business in libya must await national elections before it really cranks up and is there an effort now being made by the national council to reform the and to predict structure for doing business?

>> i don't think the business needs to wait for the elections. the process will be that on june 21st hopefully there will be an election for to injured people that will be tasked to write the constitution and choose the next contemporary government for the period of one more year. so you can keep saying let's wait until then, wait until that point where that point. i think now really is the time to come to libya for business because even if the top names change, the people who are going to be dealing with contracts and the economy, and commercial adventures will be part of the political and economic fabric of libya for years to come. so i don't think there is any purpose served by waiting for

the elections because the flow with the of the situation is very similar to read the point is you must come establish yourself, make contacts that will stand you in good stead for the years to come. like i said, the government is in no position right now to award the contract for several reasons but you are in a position to make contact with the people who will be making those decisions as the days and weeks go by. >> the second part of the question was for their efforts under way to reform that somewhat antiquated legal structure in the regime? somewhat antiquated legal structure of the old regime is there some serious effort? >> they are reviewing all the different laws from the gadhafi era and those that are appropriate will say and those that need to go will go. i will tell you that in terms of

transparency and in terms of getting rid of the endemic corruption that characterized the gadhafi years this government is committed to giving that and creating a new environment for business to come. it doesn't mean that the entire system that characterized the years will be gone, but one of the reasons i might add the the government has been so reluctant to start the new projects and give out new contract is because they are so aware of the highest that are upon them with respect to corruption so they are being very meticulous almost to the point of inefficiency so as not to be tainted with any kind of brush in the corruption. >> thank you, ambassador. ambassador jeffrey as you know the chamber is support of your efforts to get more u.s. business investment in iraq.

problems remain as you've indicated. is the maliki government serious about making the reforms required to attract and maintain foreign investment, that is how the whole process by which you mentioned finance in particular is a problem particularly on the big infrastructure projects, but a lot of american business would say it's also entry-level problems getting permits, getting a registered some problem of corruption, etc.. is there a focus on that currently in the government? >> here's the problem when the government focuses. even if not particularly well organized a government like the iraqi government is a mirror image of the government to get i can assure you all sitting here today that somewhere within a three or 4 miles deer is a federal bureaucrat is worried about every single issue in the world and is focused on it.

whether he or she will achieve anything is another question in washington and also baghdad so they are focused on these things because we tell them and other people tell them and the imf tells them. the formal answer to what you said would be they would roll out commissions and special envoy is and people that set out to look at it but the answer they will say is lots of people are coming here. turkey, iran, the e.u., as i said in certain sectors of the americans there figuring out ways to work for it the oceans of bureaucracy and the red tape and making a profit here. that in fact is true. nonetheless it is our job as an american embassy to try to streamline these procedures to the extent we can with the iraqi government in some areas we have made some progress in the last

three or four months but it is a very tough process. working in iraq is not for sissies. [laughter] trust me. somebody works in iraq, but also as many of the thousands of people as you read about in the newspapers they would say it is a profitable and enjoyable undertaking because iraq does not as much american involvement as much as possible. one of the ways that we tried to deal with the political issues i cited earlier and ambassador pickering listed earlier is to try to encourage the business involvement in engagement and it's tough on the other hand there is money to be made and the long-term contracts the assumption is it is not a certain assumption that it is that iraq will remain a unified stable country and improve

security and a growing enormously thinks of nothing else to the increased oil exports so come on in. thank you. >> thank you come investor. ambassador patterson, can you give us some insight into the presidential election of coming with a likely occur in may as still the front-runner and will the president possibly lie not in some kind of an alliance with the military in the new parliament? is that enough for one questioned? >> that's enough. [laughter] i think the last i saw -- the last i saw from the embassy is hundreds of people have decided to run for president in egypt, which is a reflection of the new democracies and there's probably half a dozen of serious competitors for the elections but i will say he is leading in

all of the polls and the egyptian poles and others and is probably still meeting. these are the same i might add that were astonishingly mistaken about the south because there wasn't a single one that predicted that they were going to show 5% and they got 22%. so you can't rely on polls, the demographic and egypt is not very good. so i think it is an open question, and who is going to win the presidential race is its begin to heat up and it promises to be very interesting and i think we might be surprised. we might be surprised but we will just see how it plays out. the military i think the military is going to play a prominent role for the years to come in egypt and many other countries from latin america to turkey. it will take a long time to

disentangle the military from public life again as it has all over the world. but why has been reassured by the military's in the initial relationships with the parliament, which is noisy at times but has been fairly successful so far. >> i have a question for ambassador krajeski. what is the status of bader reign as a banking center per say for financial services or is there still investment inflow in that area, and what in particular would you edify use the u.s. business at this point? >> most certainly they remain one of the strong guest centers of thinking financial services in the gulf. despite the unrest of last year and perhaps even more impact of the economic crisis in 2008 and

competition from the other cities in the gulf coast particularly in dubai for their services. they still remain a very attractive place for banking, for financial services, and we see an inflow of those companies along with the worrying outflow from some of the banks. a couple of banks have moved, some of the major banks have established offices and other cities. others in the gulf and quite frankly as a fallback position should the situation involving deteriorated again. i do believe it is one of the strongest sectors and it will be for the years to come, assuming as i am doing today that they do find a way forward on the political site. >> unfortunately we are very

tight on schedule so we are going to have to wrap up the q&a for this panel. i want to thank you again for being here. just an extraordinarily informative, thank you again for your service to the united states, and i hope to see you soon in your countries and you are always welcome here at the national usair of chamber. thank you very much. [applause] >> we are going to have three quick photographs with the ambassadors here and sponsors, so if i could just keep you here >> we have to press ahead as i

would like to reconvene the forum at this time. as you know, we are still on our tight schedule with one hour remaining for the second panel. the same procedures will pertain to questions from before curious of these began sending them up as the panelists give their opening remarks. moderating our second panel was the honorable allan larson whose biography you have in the booklet. on an sure all of you in the room and certainly we at the national u.s.-arab chamber remember his days as under secretary of state for economics and his many years prior to that in the bureau where he was the champion for u.s. trade and international treatment for u.s. companies. so it's a particular pleasure to call on ambassador larson to moderate this panel. >> thank you very much. good afternoon everyone. we are looking forward very much to this panel. we are going to be considering a set of challenges that perhaps

paradoxically are just as difficult and a daunting in many ways of the economies in transition which we just heard discussed in the previous panel. experience around the world has shown sadly that ample endowment of natural resources which should be a blessing for the national economic development can on occasion be a curse. nations that are rich to the natural resources need to figure out ways how to translate that potential wealth under the ground into the enduring forms of wealth above ground that can create high and rising standards of living. doing this experience has shown that requires serious effort to avoid the temptation of overconsumption, the temptations of poor investments in the projects and sometimes plan out

corruption. more affirmatively, making this transition from hydrocarbon to a broader and more diversified economy requires an effort to make sensible thoughtful investment in infrastructure and education from and in the creation of an entrepreneurial culture and the establishment of a sound regulatory environment for business. i think this should be an interesting set of discussions, and getting what we would like to do is begin as we did last time with some remarks by the ambassador. >> thank you. my name is michael. i've been in the uae for almost seven months and business has been my top priority. i would like to start this panel by saying that if the uae is open for business and i would like to say that for two

reasons, one, the uae has benefited to a certain extent from the problems in the other arab countries has people are moving there in the business and tourism is going there but i would also argue that it's because the uae has positioned as of as a transit hub and with the major airlines with dubai and abu dhabi coming along and the new sub-saharan african market is developing the indian subcontinent and since the stands are developing i would also like to focus on the subject of the panel which is alternative energy while the traditional areas of business, aviation, defense, infrastructure are moving ahead in uae. there was a pause but now they are moving ahead and they are continuing in those areas. the future summit earlier this year provides an opportunity for u.s. companies to enter into a country where there is planning for the future. and what i see is the uae is the

place we can do competition with the indians, the chinese and the turks in areas such as alternative energy and i would point out healthcare and education. the u.s. brand is extremely popular still. what we are facing is sometimes a 40% of the cost of our products and services when you look at india, china, turkey and other competitors. what we need to do and what i see in the u.s. companies that are willing to go to the united emirates rac pursuing the the potential in that country with its young dynamic leadership with its vision for the region. as i said last year, there was a slowdown in projects but i think the world future energy summit, moving beyond the traditional oil and gas into the areas such as solar and other areas offers a great potential for u.s. business.

i see u.s. businesses, small and medium companies coming to the uae and finding an atmosphere that is conducive to business for the region and beyond as i said that transit hub we have almost 800 u.s. companies already and there are more coming. we need to encourage more companies to come there and do business turkey and china in the world and i feel we can be successful because the u.s. brand name is so popular still if we can just be to our competition on price and we can when you look at things such as our follow-up services and reputation and the way we do business and i will stop there so we don't run into too many investors talking for too long and i will wait for questions and answers that we are very much open for business and alternative energy is a great area to read thank you. >> fancher for the overview. saudi arabia is the largest economy and in many ways the bellwether and we look forward

to your comments. >> let me just start by agreeing that saudi arabia is open for business. we had a very successful three years and the combination of the state department and policy efforts combined with commercial service. this last year we increased our exports to saudi arabia 20% and it's been double-digit in the exports over the last three years we increase the experts on hundred 3% in the last year. the big shift in the last two years we had 208 companies that have exported the saudi arabia for the very first time many of the small and medium enterprises, so those of you who still are waiting on the sidelines to get in touch and connect. the focus was diversifying the ways from hydrocarbon and i will

leave you with three areas to consider because you will see a shift in the direction or not least the conventional way of looking at hydrocarbon and the first issue is domestic consumption and i make it a matter of policy to never do math and public but saudi arabia uses domestically about 20% of the oil and 30% in the summertime, the domestic energy consumption is increasing about 10% of years and you do that for 20 years you've got a problem so that's the first issue these got to deal with because you then go from being a part of opec to onec which is the organization of petroleum mullen exporting countries. that's not where you want to be. second issue is opportunity cost

because if you consider the value of a barrel of petroleum, you realize that the current method of dealing with hydrocarbon as an exporter doesn't make a lot of sense. if you natural all whole in the ground and sell that to somebody the value is about $100 a barrel and if you find it go downstream it is worth about $300 a barrel and creates three times the number of jobs that upstream does as an ex apple an incredibly successful but the end of the day you're putting your natural resources and the liquid form on the ship and sending it halfway around the world for somebody else to make something with it. if you can take some of those to the evidence and turn them into products, that their role of the wheel was about worth a thousand and creates ten times the number of jobs that upstream does and if your problem as as it is in saudi arabia jobs, jobs, jobs, 3 million people in the workforce in the next decade

then you've got to consider diversification of your economy because it makes no sense to the news that oil and to dump eight and charge people for their electric bill and 60 cents for the gallon of gas when you could using it more productively as something else so i'm not a very sanguine about how quickly they are going to move because the debate really is still about costs per kilowatt and solar and wind doesn't get there yet it's the opportunity costs of using your hydrocarbon for something that doesn't make sense. and feared is the global market and where the global market is going. and i say that because i don't know where it is going refused to predict but i know the current projections are probably wrong because everybody was talking about p. doyle and today nobody's talking about people

we'll take a -- peak oil. the united states has shown a significant reduction, significant single-digit but flat lie and a reduction in the consumption. now if that continues at that pace say over a decade we put a dent into the u.s. consumption and use that as a model for other people then you have significantly changed the view of the global demand. if you add to that the an improvement in the hydrocarbon wind and solar the current projections only cause about 15% of the global energy to be

renewable blight 2035. that changes then it makes a huge impact and the third which is an issue nobody talked about five years ago but everybody's talking about today is the oil and gas and that is in fact our reserves are what some people are projecting and if you can overcome the technical environmental challenges and then you can move to shift some of our economy away from oil to natural gas for any number of reasons those things together fundamentally shifted the global demand curve and i would argue if they come in together with the technological innovation that is possible, we could have a difficult conversation ten years from now than we are today. thank you. >> thank you very much. let me remind everyone has if you have a question for any of the ambassadors, please, write