The State Department web site below is a permanent electronic archive of information released prior to January 20, 2001.  Please see www.state.gov for material released since President George W. Bush took office on that date.  This site is not updated so external links may no longer function.  Contact us with any questions about finding information. NOTE: External links to other Internet sites should not be construed as an endorsement of the views contained therein.

Lino Gutiérrez, Principal Deputy Assistant Secretary of State for Western Hemisphere Affairs Remarks at the Miami Conference on the Caribbean and Latin America, Miami, Florida, December 8, 2000

As prepared

It's great to be back in Miami for this 24th annual CLAA Conference. And it's a pleasure to be able -- finally -- to celebrate at this conference that Caribbean Basin Initiative (CBI) enhancement is no longer a promise but a fact, and that trade is now flowing under the new Caribbean Basin Trade Partnership law.

Of course, none of us can afford to rest on our laurels. The new law does not guarantee positive results. What it does is provide opportunities to Caribbean Basin countries for major increases in exports and jobs and ultimately greater stability and prosperity. Those benefits will go only to those countries that have the right policies to attract investment and encourage productivity and competitiveness. We in the State Department look forward to continuing to work with CBI governments and the private sectors in both the U.S. and the Caribbean Basin to help make the changes needed to maximize these benefits.

The theme of this year's conference, "Transitioning to the Global Economy," is right on target. In the quarter-century of my Foreign Service career, I have witnessed a transformation of Latin America and the Caribbean. But this region's full and positive integration into the global economy of the 21st century will require changes even deeper than what we have witnessed so far. Fortunately, we have a solid foundation upon which to build. Most importantly, the hemisphere today shares a common set of fundamental values. Democracy has become the norm with more than 95% of the hemisphere's population living under constitutional democracy. Economic policies are on the whole market-based and focused on the private sector as the key to growth. The U.S. relationship with Latin America is that of a partnership among equals. Through the Summit of the Americas, we are implementing together wide-ranging programs to promote democracy and prosperity. As many of you know, the hemisphere's leaders will meet again in the Third Summit of the Americas in Quebec, Canada in April 2001. In all likelihood, this will be the first foreign trip for our new President.

I want to emphasize that there is broad bipartisan support in the United States for this vision of the Hemisphere. Our fundamental foreign policy goals for the Hemisphere transcend any particular Administration or political party in the United States.

The economies of the Hemisphere are becoming ever more tightly integrated. Last year two-way trade between the U.S. and Latin America amounted to $310 billion; for the first nine months of this year it already reached $282 million, about 25% higher than the comparable period in 1999. Latin America and the Caribbean has been the hottest market for U.S. products, with average annual growth since 1995 of 10%, twice the rate of growth of our exports to Europe.

This growth in trade is coming about primarily through private sector activity, strengthened by the network of agreements that governments have negotiated over the past decade to reduce barriers to trade. The Free Trade Area of the Americas (FTAA) will provide a further major stimulus to trade and growth. As many of you are aware, nine negotiating groups are now preparing an initial consolidated draft of an agreement for presentation to Trade Ministers in the spring. Although we expect that major portions of the text will not be agreed, that is, they'll be "in brackets." However, it is clear that negotiators of the 34 participant countries are making major progress toward completing an FTAA agreement by the scheduled date of 2005.

As you know, Presidents Clinton and Lagos announced on November 29 their agreement to begin negotiating a U.S.-Chile Free Trade Agreement. These negotiations will build on the technical work done by the U.S.-Chile Joint Commission on Trade and Investment that was established in April 1998. Both presidents emphasized that negotiations of a bilateral agreement will provide further impetus for negotiating a hemispheric FTAA.

People-to-people ties in the Hemisphere are also growing at remarkable rates. Latin and Caribbean music, literature, and art have increasingly become part of the U.S. cultural mainstream. Today, people with Latin American or Caribbean roots account for 12% of the US population; this proportion is expected to increase to 15% by 2010. (As we recently saw in the US presidential election, Hispanic voters were courted by both political parties.) The remittances from these communities in the U.S. to their families "back home" have become a critical element in the economic development of many countries, especially in the Caribbean and Central America. Passenger traffic between the U.S. and Latin America is estimated to exceed 40 million for this year. Internet usage in Latin America is growing at 36% per year, the fastest growth for any region of the world. By the year 2005, Latin America will have an estimated 67 million internet users, with e-commerce sales estimated at $15 billion.

While much has been accomplished, there is also much to be done. The biggest challenge is to consolidate democracy. The development of lasting democratic practices will not occur in all places at the same time or at the same pace. While the past year has seen an historic vote in Mexico and credible elections in another eight Latin American and Caribbean countries, free and fair elections are not yet a guaranteed feature throughout the hemisphere. We are heartened by the recovery underway in Peru from its flawed elections. But we remain deeply troubled by the questions about democratic processes raised most recently with regard to Haiti as well as challenges to democracy in Ecuador and Paraguay. The recent unrest in Bolivia is illustrative of the vulnerability of democratic governments.

But to be secure over the long run, democracy must go beyond elections. Citizens must be able to trust their nation's institutions to protect them against both external and domestic violence, including stemming the tide of illicit drugs. In this connection, the passage by Congress of the $1.3 billion package in support of "Plan Colombia" offers hope of an integrated approach dealing with all dimensions of the drug problem, addressing the social, economic, and political problems facing Colombia. The success of Colombia's campaign against drugs is of priority importance to the entire hemisphere. But we must also monitor the drug situation in all countries, lest we merely move the problem from Colombia to somewhere else.

For democracy to be secure, citizens must have the confidence that their nation's institutions will treat them fairly and efficiently. They must be able to count upon their economic system to provide rewards consistent with an individual's efforts. Many governments throughout Latin America and the Caribbean are only now beginning to make headway in these areas.

Central to the political problems afflicting the countries of the region is the profound and deeplyrooted problem of poverty. Most of us know the bleak statistics: Roughly 150 million people (a third of the region's population) living on $2 a day or less. Latin America has the most skewed distribution of income and wealth in the world.

The region has experienced a decade of growth, growing in the 1990's at three times the level of the 1980's. But the old saying that "a rising tide lifts all boats" does not hold true when there are systemic channels directing the flow of wealth into the pockets of a relative few. Addressing these blockages will involve re-defining deeply-rooted preconceptions and traditions. But failure to do so puts the region's democratic gains at risk.

It also puts at risk the region's hard-won economic gains. The growth of the 1990's was not enough to meet the expectations generated by the democratic, market-based model, nor was it enough to make real inroads into poverty. The result has been that neither democracy nor the market model command the full trust of the region's citizens. An opinion survey of 17 countries done last year shows that, while a majority of Latin Americans favor democracy as a concept, sizable growing minorities are dissatisfied with the way their governments are performing. Indeed, as reported in both the Washington Post and Miami Herald recently, South America is now experiencing the largest exodus of its population in a decade, estimated to be at least 150,000 on an annual basis. This migration comprises both poor unskilled workers and well-educated professionals. What they have in common is a loss of hope for a better future in countries beset by political or economic crises.

The region thus faces an imperative for higher and more broadly spread economic growth to fulfill the promises of democracy. It is globalization and free market reforms that are often blamed for high unemployment and economic crises. Ironically, it is most often the lack or slow pace of market reforms that is the root cause of crisis.

Whether critics or proponents of globalization, most knowledgeable people agree that globalization is inevitable because of the advancing technologies of transportation and communication. The choice facing countries in the 21st century is not whether to accept globalization but how to prepare for it. Taking advantage of globalization will require not only governmental policies to attract investors, but also profound institutional and even psychological changes across societies. But there is no other way. In the words of French author Jean-Francois Revel, "Globalization is irreversible. No country is so foolish as to lock itself within its borders."

You as business leaders have played a critical role in moving the region forward toward democratic and free market ideals. But if democracy is to flourish, you will have to redouble your efforts to cement democracy in place and make it relevant and tangible for the average citizen. It will require a firm and long-term commitment on your part to the following goals:

• First, making quality education available to all is perhaps the single most important thing you can do over the long run to consolidate both democracy and prosperity. Education is indispensable not only to produce a modern productive work force but also to help citizens make informed decisions on issues of governing.
• Second, the rule of law must be strengthened -- by modernizing justice systems to make them more efficient and responsive, by ensuring that property rights of even the poorest citizens are respected and protected, and by controlling soaring crime not with vigilante justice but with efficient and law-abiding police systems. You as businessmen, your workers, and your customers are all affected by crime and violence, and should work closely with local police to make our communities safe.
• Third, corruption must be weeded out in both government and business so that goods and services are provided to the public efficiently and impartially.
• Fourth, the political process must become more inclusive, open to dialogue and avoiding a win-at-all costs mentality. Power-sharing and compromise must be encouraged.
• And finally, I urge you in the private sector to engage in the public dialogue on globalization. The public needs to understand the potential of globalization to increase employment and raise incomes of the poor around the world. But I also hope that you will emphasize the need for domestic institutions to ensure that the benefits of globalization are broadly-shared -- through such means as respect of workers' rights, protection of the environment, and establishment of a safety net to help individuals and communities that are not able to take advantage of change.

In conclusion, let me re-affirm the commitment of the United States to continue our support for securing the democratic and economic gains that the region has achieved over the past decade. We owe it to future generations to continue to build a united, prosperous and stable hemisphere.

Thank you.

[end of document]

Bureau of Western Hemisphere Affairs
State Department Homepage