Creating Jobs to Fight Poverty and Strengthen Democratic Governance

In our view, the preliminary conceptual document you have presented provides a solid starting point for our preparations for the IV Summit of the Americas.

As the document points out, decent work is essential to the material and human progress of the Americas, and generating more and higher quality employment requires effective implementation of government policies.

I want to note several of the issues in the paper that my government believes merit particular attention by leaders at the next Summit:

• First, we fully support a focus on reaching out to micro-, small-, and medium-sized enterprises through technical assistance, training, and other services. These businesses are the future engines of both economic prosperity and job creation in our countries, and we need to ensure that they thrive. We started addressing the barriers to SME development in Quebec, and leaders made some very specific commitments at the Special Summit in Monterrey. We need to build on those as a major element of the next Summit.
• Second, there is no doubt that our economies will be unable to grow, attract investment and create high-quality employment without effective educational systems. The paper you have presented rightly notes the need to increase our focus on vocational training and other schooling systems at the next Summit.
• Third, the concept paper highlights the fact that governments must create an institutional environment that fosters business and investment, and identifies many of the key elements of an appropriate institutional environment: strong anticorruption and anticrime policies, effective law enforcement, impartial judicial systems, and sound macroeconomic policies.

This last point on the institutional environment deserves particular attention. Just three weeks ago, I sat with many of you here today in a special Permanent Council meeting on integration and development. At that meeting, we heard from Guillermo Perry [from the World Bank] and Eduardo Lora from the IDB, Francisco Ferreira from the World Bank, Ines Bustillo from ECLAC, and Jose Salazar from the OAS Office of Commerce, Growth and Competitiveness. These experts from the region laid out for us in fairly stark terms the role that weak institutions play in preventing the businesses and individuals in our region from attaining their full potential. They stressed the need for reform in education systems and labor markets as a sine qua non for poverty reduction, advocated policies to promote SMEs and improve the business climate, and noted the importance of strengthening property rights, fighting corruption, and transparency if we are to generate the sustained high growth levels needed to create good jobs.

These regional experts stressed the central role of good governance if we are serious about achieving the sustainable growth necessary to create good jobs. Recent World Bank studies show, for example, that countries that significantly improve key governance dimensions such as the rule of law, corruption, transparency, the regulatory regime, and voice and democratic accountability can expect in the long run a dramatic increase in per capita incomes and other social dimensions. Yet these studies also show that our region falls well behind the OECD, Eastern Europe, and the newly industrializing countries of East Asia in governance indicators. Given the demonstrated link between governance and growth, we are following a recipe for stagnation and poverty, not prosperity and job creation, if we don't pursue good governance as a priority.

What struck me most about the session last month was that most of their policy prescriptions are already on our Summit agenda. Our leaders know what to do; our leaders have given us a mandate; now we need to work together to put those mandates into practice through concrete commitments and actions in each of our countries.

Mr. Chairman, I hope you will permit me three additional brief points with regard to the Fourth Summit of the Americas, looking beyond the central theme so well chosen by your Government.

• First, in addition to addressing the central theme, the Summit must deepen the concrete commitments our leaders made at the Special Summit in January. Many of the Special Summit commitments--such as lowering the time and cost of starting a business, expanding credit to SMEs, strengthening property rights, lowering the cost of remittances, and fighting corruption-- directly impact our ability to promote economic growth and job creation. The next Summit provides an important opportunity to measure progress and build upon previous Summit commitments.
• Second, as we move forward with planning, we should carefully consider the scope for the next Summit. We fully support the goal of a short, focused political declaration. But it is also important for leaders to deepen progress across our full hemispheric agenda through a plan of action to accompany their declaration, which would allow leaders to address the full range of issues from previous Summits.
• Third, the Fourth Summit of the Americas must maintain the momentum of the Summit process. At the Special Summit, leaders took the important step of calling for concrete, specific commitments. These types of commitments improve the accountability and legitimacy of the Summit process. We believe that the leaders should make similar concrete, specific commitments at the next Summit.

Mr. Chairman, we particularly appreciate your government's efforts to start us thinking about the next Summit at this early stage. Advance planning will help set the stage for an ambitious, robust Summit. It is in that spirit of planning and cooperation that my Government is pleased to host this Thursday for all of the governments present here a day-long seminar on the topic of job creation in the Hemisphere. We hope this seminar will provide a solid technical foundation for our discussions over the next year.

Thank you, Mr. Chairman.