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Noriega Remarks to Central American Community

Remarks to Central American and Dominican Republic Community Leaders

Roger F. Noriega, Assistant Secretary for Western Hemisphere Affairs
Remarks to Representatives of Central American and Dominican Republic Communities in the United States (CENDRUSA)
Washington, DC
April 6, 2005

As prepared for delivery

It is my pleasure to welcome you to the State Department and to this meeting today of Central American and Dominican communities in the United States. CENDRUSA, as we call it, follows on the heels of last year's successful CENUSA conference. I know some of you were here for CENUSA, and it's wonderful to have you back. Assistant Secretary Noriega addresses an audience of Central American and Dominican Republic community leaders in the U.S. on behalf of the Central America-Dominican Republic Free Trade Agreement.

To our Dominican friends, and those of you we are meeting for the first time, a special welcome. Today, you will hear from a variety of officials involved in the day-to-day conduct of our relations with the Dominican Republic.

That relationship is deepening daily and we are on the verge of opening a new chapter as we approach ratification of the Free Trade Agreement between the United States, Central America and the Dominican Republic which we refer to as CAFTA-DR. I hope that you will leave this conference with a better understanding of what this Agreement can accomplish for our six partner countries and the United States.

We have a distinguished list of speakers today, not only from the U.S. Government, but also from governments of our partner countries. They all have a detailed knowledge of the Agreement, and, just as important, they understand the positive impact that it will have on growth, jobs, and democratic institutions in our respective societies.

But today's meeting is not about you listening to us speak from the podium; it is meant to be a dialogue among all of us here in this room. So, we look forward to hearing your questions and comments.

You all bring cultural and family links with Central America and the Dominican Republic to your leadership role in the U.S. economy and society. And we welcome your unique perspective and valuable insights on the relationship between our regions, and on the prospects for free trade.

To begin our discussion, I'd like to say a few words about CAFTA-DR's role in the Bush Administration's overall foreign policy objectives.

Free trade is a key element of President Bush's economic philosophy, and of his strategy for the Western Hemisphere. The United States has important political, economic, and security interests in Central America and the Caribbean. Obviously, it is very much in our interest that our neighbors be prosperous, stable, and free.

We see expanded trade as the engine for greater opportunity for all the region's citizens. CAFTA-DR will be a major force to help increase productivity and competitiveness, resulting in more growth and more jobs, and thus promoting long-term and self-sustaining prosperity.

But in order for an economy to prosper, it must function within a system that provides equal opportunity for all, and within a legal system that is neutral and open to all. We see CAFTA-DR, and other trade-opening agreements, as providing opportunities for a better life to people from all walks of life in all participating countries.

It is NOT true that trade agreements are beneficial only to big business. While they do encourage established businesses to innovate and expand, they also create opportunities for new entrepreneurs and small businesses, and they help workers in these countries by creating new jobs.

The impact of CAFTA-DR will also reach far beyond economics, encouraging improved enforcement of labor standards and increasing cooperation to promote sound environmental management. And the disciplines, competition, and increased economic integration brought about by the Agreement will challenge those economic actors that have grown complacent in captive, uncompetitive markets.

We see CAFTA-DR as promoting social mobility, strengthening democratic institutions, and encouraging governmental transparency.

In other words, we want the Agreement to stimulate not just growth, but also positive structural change in Central America and the Caribbean. We see it as complementing and strengthening the political transformation already underway from a region plagued by civil wars and military governments to a region with thriving democratic institutions and market-based, growing economies.

Of course, the Agreement's benefits will flow not only to Central America and the Dominican Republic, but also to the United States. Our economies are already intertwined. When a new plant opens up or expands in the Caribbean Basin, the machinery and equipment already tends to be imported from the United States.

CAFTA-DR will intensify that trend. It will establish the second largest free trade zone in Latin America for U.S. exports. Our two-way merchandise trade with the other six participants amounted to $33 billion last year, making them our fourteenth-largest trading partner world-wide. We expect to see substantial increases in our mutual trade in response to these new opportunities.

I want to emphasize that CAFTA-DR and other trade liberalizing agreements are not zero-sum games; one side does NOT gain in correlation to another's loss. These are win-win transactions. By eliminating economic barriers among the participants, trade agreements expand opportunities for all.

But that doesn't automatically or magically; we all have to make it happen. All seven signatory countries governments and private sectors alike must work together constructively to prosper and strengthen democracy in our countries.

Obviously, the first item on the agenda is for our respective legislatures to approve the Agreement. This has already happened in El Salvador, Guatemala, and Honduras. And we are working closely with our friends in Congress to make the Agreement a reality for the United States as well.

We recognize that we face challenges. But this administration is working hard to create the climate in which CAFTA-DR can be approved by Congress. From my own experience working in the Congress before I came to the State Department, I know that most of the U.S. Congress indeed, most of the U.S. public understand that we cannot live in economic isolation and that well-constructed trade agreements are indeed beneficial for all.

One particular challenge that we in the Administration face is to convince doubters that the provisions of CAFTA-DR meet their concerns: that trade be fair as well as free, and that the benefits will be shared by workers as well. That is a task in which I personally, together with my colleagues, am deeply engaged.

As I noted, a key item on our common agenda is continued economic and political reform among the partner countries. Indeed, the reforms that have already been undertaken in the region are an important part of the arguments that we make in favor of U.S. approval of CAFTA-DR.

There is no doubt that to achieve their full potential, trade-liberalizing agreements must be complemented by sound macroeconomic policies, good governance, and sustained investments in health and education to build human capital. Obviously, these are good things in themselves for the people of the region.

In addition, to the extent that our trade partners respect democratic procedures, tackle inflation, crack down on corruption, privatize inefficient state-run enterprises, strengthen the rule of law, and improve health and education services, they will magnify the benefits of free trade.

Progress on this agenda helps me and my colleagues to explain to the U.S. public that our CAFTA-DR partners, while continuing to face significant challenges, nevertheless are taking the steps needed to build sound economies and just societies, and thus deserve our help.

I want to emphasize that the United States remains deeply committed to providing that help not just in implementing the CAFTA-DR, but in a broader sense as well.

We recognize that our partners need assistance to fulfill their new obligations under the Agreement and to fully exploit the opportunities that it opens up for them.

For the first time in any free trade agreement negotiated by the U.S., CAFTA-DR has established a Committee on Trade Capacity Building, or TCB. Its task is to coordinate activities and ensure that they are consistent with the "National Trade Capacity Building Strategies" developed by CAFTA-DR countries to identify and prioritize specific trade capacity building needs. The Committee promotes partnerships not only with the U.S. government, but also with non-governmental organizations and international institutions such as the Inter-American Development Bank.

In response to the needs identified by the Central American countries and the Dominican Republic, U.S. Government assistance to our CAFTA-DR partners has increased from approximately $66 million in 2003 to more than $80 million in 2004.

TCB assistance is only part of the array of assistance that the United States and other bilateral and multilateral donors provide to our CAFTA-DR partners to strengthen their security and develop their economies. For FY 2005, the United States has budgeted a total of $231 million in assistance to the CAFTA-DR countries, including almost $20 million specifically earmarked by Congress to strengthen CAFTA-related labor and environment programs.

Ladies and gentlemen, CAFTA-DR is a major step forward in deepening our relationships with the region, in promoting broad-based, sustainable development in the participant economies, and in furthering the economic integration of the Caribbean Basin.

It is also clear that this Agreement will help shape future trade agreements not only in the Western Hemisphere but globally. With CAFTA-DR, the United States, Central America and the Dominican Republic are establishing the foundation for the region to flourish in the highly competitive global economy and to provide a better life for all the region's people.

Thank you all very much.

ENDS


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