U.S. Secretary of Commerce Carlos M. Gutierrez
Council of the Americas
Tuesday, May 3, 2005
Washington, D.C.

Thank you. Thank you very much. That’s a full bag of caffeine; that’s about a two-day supply for – (laughter).

Thank you for having me and thank you for that very kind introduction, and I want to, first of all, extend my congratulations on your 40 th anniversary and commend you on your commitment to free trade and open markets throughout the Americas. And I know that David Rockefeller is here. Mr. Rockefeller, you must be very proud that this organization is vibrant and carrying out the mission that you saw back 40 years ago, so congratulations for that.

The president and those of us serving in his administration share your commitment and appreciate the opportunity to take part in this program. I’d like to begin by acknowledging the enterprises that you represent and the exceptional difference that your businesses are making in our hemisphere. You are adding a critical element to the rising tide of economic freedom; your efforts can help the emergence of a stable and democratic Latin America. You are true heroes. You are investing capital, you are taking risks, you are putting people to work, you are creating customers for goods and services, you’re translating opportunity into jobs, and you are transforming the region by introducing the core principles shared by self-governing and stable societies. Governments provide the framework for prosperity, but it is the partnership between governments and the private sector that enables people to achieve it. The private sector drives economic growth; governments set the stage. So you play a pivotal role, and I know that because I’ve seen amazing things from your companies and what you are doing throughout the region.

Free trade, as you well know, opens the door to greater prosperity for developing economies. We share a common mission to expand economic freedom. I know that my predecessors at the Commerce Department have worked closely with all of you in the business community to achieve important objectives. Government and industry worked side-by-side to pass CAFTA, NAFTA, PPA, and permanent normalized trade relations with China, which I know you all worked very hard on.

The Security and Prosperity Partnership for North America is another opportunity to build more open, more secure societies and more competitive business communities for stronger economies. We make our region the most competitive enterprise in the world by eliminating unneeded regulations, ending testing duplications, and removing other obstacles to growth.

And we now need to come together once again to pass DRCAFTA. This agreement is essential to our countries for economic reasons, for strategic reasons, and importantly for symbolic reasons. Anyone who wants to decide the outcome of this philosophical struggle between economic isolationism and economic liberty does not belong on the sidelines. This is a critical time for that discussion. It’s a critical time for the whole debate between free trade and protectionism and isolationism. So we need to stand up, we need to support freedom, we need to support democracy, we need to support free enterprise, free trade and entrepreneurialism.

You’ve heard, I’m sure, the other side of the argument. Isolationists have been out marshalling a lot of opposition to CAFTA, so we’re battling – in some cases – distortions, we’re battling disinformation, we are battling demagoguery in some cases. The great thing is that reality – reality is on our side.

The growth of our economies reflects the truth about free trade and about free enterprise, and there is, as you well know, no substitute for growth. Our reality is reflected in our numbers. When people learn the facts about this agreement, they will see that free trade is fundamentally good for countries. Freedom, free enterprise and free trade are strongly in the long-term best interests of every person in our hemisphere. Trade brings powerful benefits to newly emerging economies. Free trade introduces higher standards of accountability that can slice through layers of corruption. Trade strengthens young democracies. Citizens discover the freedom to choose, well-functioning legal systems, transparent regulations, respect for property rights, accountable governance, and very importantly, the opportunity for individual growth and individual prosperity. We want to help all of the people of Central America, and we can make progress, we can help them make progress on reducing poverty, on providing adequate health care, on generating employment. We have a great opportunity to do that.

Over the long haul, free enterprise and free trade are the real answers to alleviating income inequality, which is a bit of an irony that -- especially a topic as emotional as income equality. I suggest that the best way to fix that is through free enterprise, through freedom, through business, through growth, through entrepreneurialism.

So our goal is to arm people with skills to build a stable and prosperous societies. We’re not trying to create dependent welfare states. We want to empower all of our friends in our area to become full-fledged partners in prosperity. That expansion of economic opportunity is one of President Bush’s top goals for our hemisphere.

I’d like to give you a broad overview and then say a few words about two key initiatives that this administration has underway to create more jobs by strengthening our neighbors and helping them grow economically. And I should say our president deserves great recognition for his efforts in our neighborhood. He is pursuing a powerful vision for the America’s that builds on the progress made by past presidents. President Bush’s economic agenda for our hemisphere is advancing on a number of fronts. We’re moving aggressively into the action phase of the drive to pass CAFTA. We’re moving forward with Canada and Mexico on the Security and Prosperity Partnership to take the U.S. relationship with our closest trading partners to the next level of security and economic cooperation.

We’re pursuing the Andean Free Trade Agreement, and we will pursue that immediately after CAFTA, and we want to move on FPAA and, as you well know, we’re going to need full cooperation from every country. That is in our grasp, we can do it, it’s there, and we are going to need to come together on that.

All those steps are part of a cohesive whole: the president’s vision to achieve greater self-government, security and prosperity in our region. Our most ambitious goals for the hemisphere respond to the changing nature of global competition. The emerging economic reality of the 21 st century demands that Canada, Mexico and the U.S. no longer approach our respective competitive positions as single actors. To compete effectively, we need to recognize that our individual competitive strength will increasingly be defined by the level of integration, cooperation and competitiveness within our region.

President Fox, Prime Minister Martin and President Bush spoke to this issue directly when they announced our Security and Prosperity Partnership in March. In a joint statement they said, and I quote, “In a rapidly changing world, we must develop new avenues of cooperation that will make our open society safer and more secure and businesses more competitive, and our economies more resilient. SPP recognizes the causal relationship between economic prosperity and security. The events of 9/11 demonstrated the importance of maintaining the integrity of our borders. It showed the dire consequences stemming from breaches in border security. SPP maintains the safety of our borders and enhances trade flows in North America. Those free flows of trade will make our three countries more competitive on a global scale.”

Moving to CAFTA once again, CAFTA – CAFTA will make us more competitive. And when I say us, it will make our hemisphere more competitive, not just Central America and the Dominican Republic.

There has been a tremendous amount of progress in Central America. Recall where we were a generation ago. The news from Central America was about civil wars, it was about instability, and it was a very, very, divisive issue in this country. Today, these countries are moving very much in the right direction, but we know they remain fragile democracies. I’ve had the fortune of doing business in Central America since 1980, so I’ve been traveling to the region for 25 years. And I’ve seen what happens when democracy fails. I’ve lived under that failure and I’ve worked under that failure, and we can’t allow the progress and sacrifices over the past 25 years to be squandered. We need to defend economic freedom. And we should remember and keep it very much top of mind that the opponents of CAFTA in Central America are the same people who opposed democracy and freedom 25 years ago – the same exact familiar names who would have loved to have seen a communist revolution in Central America. They are the ones who oppose CAFTA.

CAFTA will help these countries continue the transition to freedom. The CAFTA countries are already participating in our regional economic and security goals, but they want to do more. Central Americans need greater access to capital and well-functioning societies and institutions. Given those tools, these good markets will quickly grow to become great markets and great societies, and we know – we know it can work.

CAFTA is about the future. All these countries need is a chance. If given this chance, the CAFTA countries will become full participants. They will integrate and be an important part of our hemisphere.

Think of the message it would send to our friends in this hemisphere and supporters of free trade around the world if America failed to stand with the CAFTA countries. Countries in other parts of the world are banding together economically to achieve a stronger trading position. Greater integration will continue to foster jobs and prosperity in all countries. Stronger ties in the regions will keep jobs in the United States. If the concern is jobs, regional economic integration is the answer.

I would like to say and just express a great amount of respect and admiration for those countries in Central America that have passed CAFTA through their congress. And they are not free of political risk, and it is always a risk to enter into a free-trade agreement with the largest economy in the world, but they have had the courage and the vision and the foresight to move forward. And it’s very remarkable that these courageous individuals, leaders are now engaged in a campaign to convince all of us here in the U.S. to embrace free trade and to embrace this free-trade agreement. These are the same countries that 25 years ago we were wondering what can we do to help them embrace democracy and help them embrace free trade. What an irony: here they are 25 years later trying to convince us.

So they need our help, they need our leadership, they need our support. You know, it has also become fashionable to criticize NAFTA, and I hear a lot of – it’s almost as though it were a self-evident truth. People just say NAFTA has been a problem. NAFTA has not been what we thought it would be. And I’ll tell you, no one is complacent, no one is satisfied. We know that anything we take on there will always be an issue here, an issue there to confront, but overall – overall, NAFTA has been an overwhelming success.

Since 1993, U.S. economic growth has been 38 percent. Canadian economic growth has been 31 percent. Economic growth in Mexico has been 31 percent. Without NAFTA our countries would never have achieved economic growth on that scale. The numbers prove it out.

When we see U.S.-Mexican commercial ventures closing on the Mexican side of the border, we invariably see job losses on the U.S. side of the border. To compete effectively against our more formidable foreign competitors, we in the Americas need to continue building the regional economic and commercial frameworks to gain the efficiencies that we need.

America will always be a beacon for those who want to compete with the world’s most dynamic free market. A growing Western Hemisphere can offer people employment options within those countries, and I know that there are many people here who had a lot to do with NAFTA 12 years ago, and many of you worked very hard – Secretary Mosbacher, Mr. Rockefeller – and you should feel very proud of what you’ve accomplished. And just remember the numbers – the numbers support what you have done, and the numbers support the wisdom, the foresight, the vision of NAFTA, and it has been a wonderful, wonderful thing, and I trust that you will be just as vocal as those who like to oppose NAFTA in explaining and showing and demonstrating what a great thing that has been for citizens in three countries, and what a great thing that has been for the overall health of the economy. Of course there have been problems, and every time a job is lost, we all feel it. But overall – in an overall general sense, NAFTA has been a very, very good thing for our hemisphere.

President Bush has an ambitious goal for our hemisphere. We have 800 million consumers. Our goal is to bring more consumers within one unified economic zone and to raise the purchasing power of those consumers. We in business and government need to work together because economic development is a partnership.

Some suggest that we turn our backs on a vision of global free trade. These critics claim that America should retreat behind trade barriers and withdraw from the world. We all know that that would be an economic and strategic blunder and that history will never forgive us if we allow that to happen.

I hope all of you intend to stand by your principles in the days ahead. I hope all of you will be standing beside President Bush in his bold, optimistic vision of a stronger, more prosperous and more economically engaged hemisphere.

During his inaugural address, the president said, and I quote, “The survival of liberty in our land increasingly depends on the success of liberty in other lands. The best hope for peace in our world is the expansion of freedom in all of the world.”

So I want to thank you for everything you are doing. I want to thank you for what you have done for our hemisphere, and what you are doing to build prosperity throughout the hemisphere, and what you are doing for citizens throughout the hemisphere. You are taking us on the right track, you are doing the right things, and you should be extremely proud – extremely proud of what you have accomplished. And I can tell you we are very proud to be associated with you, and we look forward to working with you. So thank you for your attention. Thank you.

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