Mr. MORGAN, from the committee of conference, CONFERENCE REPORT "To accompany H.R. 15263 The committee of conference on the disagreeing votes of the two Houses on the amendment of the Senate to the bill (H.R. 15263) to amend further the Foreign Assistance Act of 1961, as amended, and for other purposes, having met, after full and free conference, have agreed to recommend and do recommend to their respective Houses as follows: That the House recede from its disagreement to the amendment of the Senate and agree to the same with an amendment as follows: In lieu of the matter proposed to be inserted by the Senate amendment insert the following: That this Act may be cited as the "Foreign Assistance Act of 1968". PART I CHAPTER 2-DEVELOPMENT ASSISTANCE TITLE I-DEVELOPMENT LOAN FUND SEC. 101. Title I of chapter 2 of part I of the Foreign Assistance Act of 1961, as amended, which relates to the Development Loan Fund, is amended as follows: (a) Section 201(d), which relates to rates of interest, is amended as follows: (1) Strike out "1967" and substitute "1968". (2) Strike out "21⁄2 per centum" and substitute "3 per centum”. (b) Section 202(a), which relates to authorization, is amended as follows: (1) After "year 1967", strike out "and" and substitute a comma. (2) After "year 1968," insert "and $350,000,000 for the fiscal year 1969,". (1) (3) Strike out "years ending June 30, 1967, through June 30, 1968, respectively" and substitute "year ending June 30, 1969". TITLE II-TECHNICAL COOPERATION AND DEVELOPMENT GRANTS SEC. 102. Title II of chapter 2 of part I of the Foreign Assistance Act of 1961, as amended, which relates to technical cooperation and development grants, is amended as follows: (a) Section 211(d), which relates to availability of funds for certain research and educational institutions, is amended by inserting "in any fiscal year" immediately after "funds made available". (b) Section 212, which relates to authorization, is amended by striking out "$210,000,000 for the fiscal year 1968" and substituting "$200,000,000 for the fiscal year 1969". (c) Section 214, which relates to American schools and hospitals abroad, is amended as follows: (1) In subsection (c) strike out "1968, $14,000,000" and substitute "1969, $14,600,000". (2) In subsection (d) strike out "1968, $2,986,000" and substitute "1969, $5,100,000". TITLE III—INVESTMENT GUARANTIES SEC. 103. (a) Section 221(b) of title III of chapter 2 of part I of the Foreign Assistance Act of 1961, as amended, which relates to general authority for investment guaranties, is amended as follows: (1) In the proviso of paragraph (1), strike out "$8,000,000,000" and substitute "$8,500,000,000". (2) Paragraph (2) is amended as follows: (A) In the third proviso, strike out "$475,000,000" and "$315,000,000" and substitute "$550,000,000" and "$390,000,000", respectively. (B) In the third proviso, strike out "$1,000,000" and substitute "$1,250,000". (C) In the last proviso, strike out "1970" and substitute "1971”. (b) At the end of section 221, add a new subsection as follows: "(e) (1) No guaranty of a loan or equity investment of an eligible United States investor in a foreign bank, finance company, or other credit institution (hereinafter the original investment') shall cover any loss of a loan or equity investment of such bank, finance company, or credit institution; and in no event shall payment be made under any such guaranty except for loss of the original investment, and, where provided for by such guaranty, earnings or profits actually accrued thereon. "(2) In the administration of this subsection, the eligible United States investor may be deemed to have sustained a loss of the original investment only if the foreign bank, finance company, or credit institution in which the original investment was made becomes or is likely to become insolvent due to the occurrence of an event against which protection is provided by the guaranty." SEC. 104. Section 224(c), which relates to housing projects in Latin American countries, is amended by striking out "$500,000,000" and substituting "$550,000,000". TITLE VI—ALLIANCE for pROGRESS SEC. 105 (a) Section 252(a) of title VI of chapter 2 of part I of the Foreign Assistance Act of 1961, as amended, which relates to authorization for the Alliance for Progress, is amended as follows: (1) Strike out "1967, $696,500,000, and for the fiscal year 1968, $578,000,000, which amounts are" and substitute "1969, $420,000,000, which is". (2) Strike out "$100,000,000 in each such fiscal year of the funds appropriated pursuant to this section for use beginning in each such fiscal year" and substitute "$90,000,000". (3) Strike out "years ending June 30, 1967, through June 30, 1968, respectively" and substitute "year ending June 30, 1969". (b) Section 252(b), which relates to authorization for the Partners of the Alliance, is amended by striking out "1968, $714,000" and substituting "1969, $350,000". TITLE IX-UTILIZATION OF DEMOCRATIC INSTITUTIONS IN DEVELOPMENT SEC. 106. Section 281 of the Foreign Assistance Act of 1961, as amended, is amended as follows: (a) At the end of subsection (c), add the following new sentence: "In particular, emphasis should be given to research designed to increase understanding of the ways in which development assistance can support democratic social and political trends in recipient countries." (b) At the end of section 281, add the following new subsection: "(e) In order to carry out the purposes of this title, the agency primarily responsible for administering part I of this Act shall develop systematic programs of inservice training to familiarize its personnel with the objectives of this title and to increase their knowledge of the political and social aspects of development. In addition to other funds available for such purposes, not to exceed 1 per centum of the funds authorized to be appropriated for grant assistance under this chapter may be used for carrying out the objectives of this subsection." TITLE X-PROGRAMS RELATING TO POPULATION GROWTH SEC. 107. Section 292 of title X of chapter 2 of part I of the Foreign Assistance Act of 1961, as amended, is amended by striking out “1968, $35,000,000" and substituting "1969, $50,000,000". CHAPTER 3-INTERNATIONAL ORGANIZATIONS AND PROGRAMS SEC. 108. (a) Section 302(a) of chapter 3 of part I of the Foreign Assistance Act of 1961, as amended, which relates to authorization for international organizations and programs, is amended by striking out "1968, $141,000,000" and substituting "1969, $135,000,000”. (b) Section 302 is further amended by adding at the end thereof the following new subsection: "(d) There is authorized to be appropriated to the President, for the fiscal year 1969, $1,000,000 for contributions to the United Nations Children's Fund during the calendar year 1969. Funds made available under this subsection shall be in addition to funds available under this or any other Act for such contributions and shall not be taken into account in computing the aggregate amount of United States contributions to such fund for the calendar year 1969." CHAPTER 4-SUPPORTING ASSISTANCE SEC. 109. Section 402 of chapter 4 of part I of the Foreign Assistance Act of 1961, as amended, which relates to authorization for supporting assistance, is amended by striking out "1968 not to exceed $660,000,000" and substituting "1969 not to exceed $410,000,000". CHAPTER 5-CONTINGENCY FUND SEC. 110. Section 451(a) of chapter 5 of part I of the Foreign Assistance Act of 1961, as amended, which relates to the contingency fund, is amended by inserting ", and for the fiscal year 1969 not to exceed $10,000,000," after "$50,000,000". PART II CHAPTER 2-MILITARY ASSISTANCE SEC. 201. Chapter 2 of part II of the Foreign Assistance Act of 1961, as amended, which relates to military assistance, is amended as follows: (a) Section 504(a), which relates to authorization, is amended as follows: (1) In the first sentence, strike out "$510,000,000" and "1968" and substitute "$375,000,000" and "1969", respectively. (2) Strike out the second and third sentences. (3) In the first sentence, insert the following proviso before the period: ": Provided further, That none of the funds appropriated pursuant to this subsection shall be used to furnish sophisticated weapons systems, such as missile systems and jet aircraft for military purposes, to any underdeveloped country, unless the President determines that the furnishing of such weapons systems is important to the national security of the United States and reports within thirty days each such determination to the Congress". (b) Section 506(a), which relates to special authority, is amended by striking out "1968" each place it appears and substituting "1969". (c) (1) Section 507(a), which relates to restrictions on military aid to Latin America, is amended by striking out "$55,000,000, of which $25,000,000" and substituting "$25,000,000, of which any part". (2) Such section 507 is further amended by adding at the end thereof the following new subsection: (d) Notwithstanding the foregoing provisions of this section, not to exceed $10,000,000 of the funds made available for use under this part may be used to furnish assistance to the American Republics, directly or through regional defense arrangements, to enable such Republics to strengthen patrol activities in their coastal waters for the purpose of preventing landings on their shores, by Communist or other subversive elements originating in Cuba, which threaten the security of such Republics and of their duly constituted governments." (d) Section 508, which relates to restrictions on military aid to Africa, is amended as follows: (1) In the first sentence, strike out "or sales". (2) In the second sentence, strike out "and sales" and strike out "$40,000,000" and substitute "$25,000,000". PART III CHAPTER 1-GENERAL PROVISIONS SEC. 301. Chapter 1 of part III of the Foreign Assistance Act of 1961, as amended, which relates to general provisions, is amended as follows: (a) Section 604, which relates to procurement of commodities, is amended by adding at the end thereof the following new subsection: "(f) No funds authorized to be made available to carry out part I of this Act shall be used under any commodity import program to make any payment to a supplier unless the supplier has certified to the agency primarily responsible for administering such part I, such information as such agency shall by regulation prescribe, including but not limited to, a description of the commodity supplied by him and its condition, and, on the basis of such information such agency shall have approved such commodity as eligible and suitable for financing under this Act.” (b) Section 607, which relates to the furnishing of services and commo dities, is amended by inserting "(a)" immediately before "Whenever" and by adding at the end thereof the following new subsection: "(b) No Government-owned excess property shall be made available under this section, section 608, or otherwise in furtherance of the purposes of part I of this Act, unless, before the shipment of such property for use in a specified country (or transfer, if the property is already in such country), the agency administering such part I has approved such shipment (or transfer) and made a written determination "(1) that there is a need for such property in the quantity requested and that such property is suitable for the purpose requested; "(2) as to the status and responsibility of the designated end-user and his ability effectively to use and maintain such property; and "(3) that the residual value, serviceability, and appearance of such property would not reflect unfavorably on the image of the United States and would justify the costs of packing, crating, handling, transportation, and other accessorial costs, and that the residual value at least equals the total of these costs." (c) Section 620, which relates to prohibitions against furnishing assistance, is amended by adding at the end thereof the following new subsection: "(v) The President is directed to withhold economic assistance in an amount equivalent to the amount spent by any underdeveloped country for the purchase of sophisticated weapons systems, such as missile systems and jet aircraft for military purposes from any country, unless the President determines that such purchase or acquisition of weapons systems is important to the national security of the United States and reports within thirty days each such determination to the Congress." CHAPTER 2-ADMINISTRATIVE PROVISIONS SEC. 302. Chapter 2 of part III of the Foreign Assistance Act of 1961, as amended, which relates to administrative provisions, is amended as follows: (a) Section 621, which relates to exercise of functions, is amended by inserting "(a)" immediately after "SEC. 621. EXERCISE OF FUNCTIONS. and by adding at the end thereof the following new subsection: "(b) The President shall issue and enforce regulations determining the eligibility of any person to receive funds made available under this |