Remarks in Response to a Report by the Advisory Committee on Private Enterprise in Foreign Aid.

IN THE YEARS since World War II, this Nation has undertaken the most ambitious-and effective--foreign assistance program in the history of civilization.

Our efforts have taken many forms, from the Marshall plan aid of the 1940's to the Peace Corps of the 1960's. But whatever the form, our objective has remained the same: to assist our fellow men in their struggles to achieve a healthier and more meaningful life.

We have taken this responsibility upon ourselves because we know it is right. But we also know that, ultimately, it is the alternative to chaos.

In a very real sense, our foreign aid programs are an indispensable part of our quest for world peace.

But Government assistance alone will never bring about the better world we seek. We need the help of all facets of our society: of business, labor, agriculture, the universities, the foundations, the churches, and other private organizations.

That is why your Committee was established by the 88th Congress: to seek new ways of enlarging the role of the private sector in foreign economic assistance.

I welcome your report today. It points up the progress we have already made. It brings into focus the problems and challenges we still face. And it gives us a number of valuable recommendations to meet those problems and challenges.

Our accomplishments to date have been many:

--Specific risk investment guarantee contracts have been sharply increased. Total coverage issued now stands at over $2.5 billion. Since 1962 the number of developing countries with which we have investment guaranty agreements has been increased from 43 to 67.

--Our technical assistance contracts with American universities and private organizations total nearly a half billion dollars and include 143 contracts with some 106 universities in 39 different countries.

--American engineering and construction firms are at work in more than 50 countries, helping to design and construct AID-assisted capital projects worth more than $4 billion.

--AID is helping the American labor movement to run a very successful Institute for Free Labor Development in Latin America and has recently organized an African-American labor center.

--Ninety-three savings and loan associations have been organized in 11 Latin American and African countries and have already attracted more than 318,000 savers and more than $85 million in savings. They are funding homes for more than 35,000 people.

--AID is helping 61 private voluntary associations, like CARE, Church World Services, and Catholic Relief Services, to distribute clothing, medicines, tools, and food overseas.

Despite this record of achievement, we know that more and stronger measures are needed to increase the flow of private capital and the technical knowledge that goes with it. We have already made certain recommendations-both in tax treaties now before the Senate and in my foreign aid message-for using tax measures to encourage private investment in the developing countries. I am certain that the Congress, in its consideration of this subject, will give weight to the views of this Committee.

Despite other restrictions brought on by balance of payments considerations, we will continue to encourage the flow of private capital to the developing countries. Not to do so--as your report points out--would defeat our purpose of encouraging the development of these countries, particularly the development of their private sectors.

To you, Mr. Watson, and to your Committee, I would like to offer congratulations for a splendid job. Following the wishes of Congress, we are sending copies of your report to all its Members and are otherwise distributing it widely. We intend to give most careful consideration to your recommendations and to seek ways of carrying them out.

I thank you sincerely for your help in this most vital area of our foreign policy.