U.S. Department of State
Dispatch Volume 7, Number 46, November 11, 1996
Bureau of Public Affairs




ARTICLES IN THIS ISSUE:

1. Our Vision of a Prosperous Middle East at Peace--Secretary 
Christopher
2. The U.S. and the Caucasus States: Working Together Toward 
Constructive, Cooperative Development--James F. Collins 
3. U.S. Policy Agenda for Latin America and the Caribbean--Jeffrey 
Davidow



ARTICLE 1:

Our Vision of a Prosperous Middle East at Peace
Secretary Christopher
Remarks at the Cairo Economic Conference, Cairo, Egypt, November 12, 
1996

Excellencies, ladies and gentlemen: On behalf of President Clinton, I 
want to express my deep gratitude to President Mubarak and to the people 
of Egypt for hosting this third annual economic conference. I also want 
to express my enormous appreciation to the more than 1,500 business 
people, from over 70 countries, who are attending this conference. Their 
willingness to invest in a better future is what brings us together here 
today.

We have come to Cairo, to this city  of greatness--ancient and modern--
because we share a vision of a prosperous Middle East at peace. We share 
a conviction that if this vision is to be realized, the peace process 
must move forward in both its political and economic dimensions at the 
same time. And we share a commitment to deepen the partnership between 
governments and the private sector so that peace can endure and thrive.

Today, the world can look to Cairo, to this economic conference, as a 
vote of confidence in the peace process--a peace process that has 
already brought us so far. And we can once again thank President Mubarak 
for reminding the region and the world of the stake that we have in 
peace.

President Mubarak shares this great responsibility with other leaders of 
wisdom and good will. Two years ago, King Hassan convened the first 
Middle East and North Africa Economic Summit in Casablanca. There we 
opened up a whole new dimension of the peace process to complement the 
political negotiations launched in Madrid five years earlier. Last year, 
King Hussein brought us together in Amman to build new bridges of 
prosperity across old barriers of hostility. 

It was also to the economic summit in Amman that Prime Minister Rabin 
made his last journey for peace. The Prime Minister spoke to the entire 
Middle East when he said this: 

So far we have invested much blood, much time, and much money in a 
product which may have been essential for our national existences but of 
little benefit for our citizens. We invested in war. Today, and from 
here on, we are committed to invest in peace. Just one week later, 
sadly, tragically, the peace process lost one of its strongest 
champions.

There is no doubt that the peace process has been tested--tested 
severely--by the traumas in the last year since Prime Minister Rabin's 
assassination. But over the last year, and especially in recent weeks, 
the peace process has also demonstrated great resilience. Arabs and 
Israelis alike know what war means. They have already glimpsed the 
promise of peace. By looking back into the abyss, both Arabs and 
Israelis recognized the imperative of moving forward.

Both Palestinians and Israelis, like all the people of the region, have 
a fundamental self-interest in bringing this conflict to an end. They 
understand that this decades-long conflict can long be resolved in 
phases over time. They remain committed to resolve this conflict through 
the structure of the negotiations that they have built together. And 
they are coming to accept that without peace there can be no security, 
and without security there can be no peace. In the wake of the recent 
violence, Israel and the Palestinians have pledged to uphold the 
agreements they have negotiated and carry out the commitments they have 
made. The current negotiations have been intensive and, at times, 
frustrating. But I believe that a final set of very specific 
understandings on Hebron is close at hand. And once those negotiations 
finally succeed, I urge the parties to move ahead with the same urgency 
to implement the remainder of the Interim Agreement.

For these and future negotiations to succeed, each side must go the 
extra mile to understand the needs of the other--to take their 
requirements into account. Each side must accept that to succeed, there 
can be no winners and no losers. Each side must win and be seen to win--
or both sides will lose. Each side must recognize that it is not 
possible to make peace without taking risks--but that maintaining the 
status quo poses even greater risks for their future. Each side should 
also know this: The United States will continue to help them take those 
risks and support them along the hard, long journey to peace.

Peace in the Middle East is a vital national interest of the United 
States. That is why President Clinton has made such a strong personal 
commitment to stand with the peacemakers at every step of the way over 
the last four years. That is why the newly reelected President and the 
next Secretary of State will continue to make the advancement of the 
Middle East peace process a top priority over the next four years.

There are historic gains to preserve--gains on which the parties can 
build. There are two landmark agreements between Israel and the 
Palestinians--and path-breaking cooperation to fight terrorism and 
violence. There is the peace treaty between Israel and Jordan--and a new 
set of diplomatic and commercial contacts between Israel and its Arab 
neighbors. There is the opportunity for a comprehensive peace that 
includes Syria and Lebanon--a peace that must finally be achieved if 
this region is to enjoy real security. And there is, of course, the 
founding pillar of peace still firmly in place--and that is the peace 
between Egypt and Israel.

We can see how far we have really come if we look at ourselves--
if we look at this economic conference. Despite all the setbacks and 
uncertainties of recent months, more and higher-level business 
representatives from around the world are here in Cairo than have ever 
before assembled  at one time in the region. You recognize opportunity 
amidst the risk, and you are attracted by the reforms that are making 
the Middle East and North Africa a more hospitable business environment.

Your profit strategies are perfectly complementary to our strategies for 
peace. Private sector capital is the most direct way to translate the 
abstract promise of peace into concrete benefits that can lift the 
lives and livelihoods of ordinary people. By giving individuals and 
communities a stake in peace, you can pave the way for true 
reconciliation among people and nations. By crisscrossing borders with 
new electrical grids, fiber optic cables, and gas pipelines, you can 
integrate the region's economies and make war ever less likely.

The process that we launched in Casablanca two years ago, and that we 
renew today, will reinforce our partnership for peace and prosperity. By 
bringing so many business people together, we are generating the 
contacts that can lead to contracts. We are showcasing opportunities 
available in our host country--Egypt--and the other countries 
participating here. And we are giving fresh impetus to the new 
institutions that will promote economic development and cooperation 
across the region.

The Middle East-Mediterranean Travel and Tourism Association is now 
established, with a secretariat in Tunis. It is working with the private 
sector to develop the enormous potential for tourism that these lands of 
miracles and monuments hold for us. And the Regional Business Council is 
poised to become an important forum for exchanging business information, 
publicizing investment opportunities, and developing ways to support the 
private sector.

We are making progress toward opening the flagship regional institution-
-the Middle East Development Bank. I am pleased to say that the United 
States will sign the bank's Charter next week, and we will send 
representatives to the bank's transition team to Cairo later this month. 
The bank's mission is to be a catalyst--to support key private sector 
projects and to focus on the region's growing infrastructure needs. The 
Clinton Administration will work with the new Congress to gain strong 
American backing for the bank so that it can become operational by the 
end of next year. I urge other nations to come forward now to support 
the bank's funding needs.

For too long, this region has been held back by the ravages of conflict 
and war--and by the inefficiencies of statist and protectionist economic 
policies. It faces a dual challenge if it is to prosper. To compete 
effectively, this region must not only make peace, it must reform. Two 
years ago in Casablanca and again last year in Amman, I called upon the 
governments of the Middle East and North Africa to meet this challenge--
to modernize their economies, open up their markets, crack down on 
corruption, and remove the bureaucratic bottlenecks and regulatory 
obstacles that have for too long scared off investors and drained away 
precious capital. Today, we can see encouraging progress across the 
region.

Here in Egypt, reform is brightening the prospects for growth and 
attracting the interest of foreign companies and investors, as President 
Mubarak so clearly outlined this morning. The government has already 
privatized over 100 companies. It has cut tariffs on capital goods and 
eased registration procedures for investors. The new standby arrangement 
with the IMF will help support Egypt as it consolidates these and other 
business-friendly reforms, such as restructuring the tax system. Egypt 
is also making important progress in strengthening its protection of 
intellectual property rights. That is one reason why Microsoft decided 
to open a regional office here in Cairo. Over 50 American companies now    
have manufacturing operations in Egypt, demonstrating confidence in the 
growing potential of this market--and that number will certainly grow. 
The United States will continue to develop our economic cooperation with 
Egypt through the partnership led by President Mubarak and Vice 
President Gore.

Jordan's recent reforms--from adopting a new investment law to lowering 
trade barriers--are also beginning to modernize its economy. The 
capitalization of its stock market is increasing rapidly. American 
companies, from Sheraton to Sprint, are seizing opportunities to help 
Jordan build its infrastructure. I am delighted to announce that, only 
yesterday, the United States and Jordan signed an Open Skies agreement 
to fully liberalize commercial aviation between us. It is the first such 
agreement we have reached outside of Europe, and I hope that we can 
negotiate similar agreements with others in this region soon to make 
both business and tourist travel more efficient. 

Israel is also carrying out important reforms that are giving its 
economy a new dynamism. Privatization is contributing to growth and 
attracting foreign investment. Israeli and Arab business people from 
virtually all the countries represented here today are forging links 
that were inconceivable just several years ago. I am very encouraged by 
Prime Minister Netanyahu's commitment to deepen economic reform. And I 
am confident that trade and investment between the United States and 
Israel and the other countries in this region will continue to expand.

Today, I want to encourage greater American economic engagement across 
the Middle East and North Africa--from the dynamic Gulf States to 
Morocco and Tunisia, two countries that are taking so many positive 
steps to encourage trade and foreign investment. I also want to salute 
the Israeli and Arab business people who have begun to build 
relationships to move forward. You are definitely pioneers for peace, 
and we need your courage and perseverance now more than ever.

But most urgently of all, I want to encourage you to invest in peace 
where it can make the greatest difference. Economic conditions in the 
West Bank and Gaza have not prospered as we had hoped. They must 
improve--and improve quickly--if we are to give Palestinians a full and 
tangible stake in peace.

We must work together to help the Palestinians build a prosperous free 
market economy and overcome the barriers to the flow of goods, services, 
and people. President Clinton has recently signed legislation to grant 
duty-free access for Palestinian exports to the United States. We hope 
our major trading partners will take similar steps. We are also working 
to establish special industrial zones that can become magnets for 
investment, jobs, and especially for hope. 

As Secretary of State, in my frequent travel to this region, I have 
spent the bulk of my time talking to government leaders and diplomats. 
One reason I value these economic conferences so much is that they give 
me a chance to speak to the business community so well represented here 
today. When I am with you, I feel I am also addressing the vast majority 
of the people in the region  who speak the common language of commerce--
and who share our vision of a better future. You are, indeed, the 
constituency for peace.

You have already waited too long to see this region's borders become 
open gateways--not fortified barriers--to trade and investment. You have 
an interest in pushing for progress in the peace process. And you have a 
responsibility to work with the governments of this region to wipe out 
the barriers and boycotts and prejudices and taboos that obstruct 
commerce and hold this region back.

We share a common purpose, and we have mutually supporting roles to 
play. We both understand that there can be no lasting peace for the 
Middle East without rising prosperity--and that there can be no lasting 
prosperity in this region without a deepening peace. If we build on  the 
diplomatic and economic progress we have already made, a new millennium 
of peace and prosperity will soon dawn over these ancient lands.  Thank 
you very much. 

(###)



ARTICLE 2:

The U.S. and the Caucasus States: Working Together Toward Constructive, 
Cooperative Development
James F. Collins, Special Adviser to the Secretary for the New 
Independent States 
Remarks to the annual meeting of the Assembly of Turkish American 
Associations, Washington, DC, October 25, 1996

I am very pleased to be here with you today. I commend the Assembly of 
Turkish American Associations for organizing this symposium, and I want 
to express my appreciation to other members of the panel for their 
remarks.

The issues we are discussing could not be more critical to the future of  
the Caucasus and to the future of American interests in this important 
region. As nations throughout the world--including the advanced 
industrial nations of Europe and North America--have discovered, 
regional cooperation is absolutely imperative if individual states are 
to compete successfully in the global arena. Indeed, if there is one 
axiom that we should keep at the forefront of our thinking about this 
area, it is that successful economic and political development will be 
inextricably linked to the growth of regional cooperation. 

Five years after independence, the Caucasus states are--individually and 
collectively--entering a new era of challenge and opportunity. 
Established as independent and sovereign members of the international 
community, each of these new states has made significant headway in 
consolidating its statehood and instituting political and economic 
reforms. The United States has steadily supported the independence of 
these young states and their transformation into democratic market-based 
societies able to take their rightful place as equals among the 
community of nations.

Working with the international financial institutions, Georgia has made 
dramatic progress in economic reform and has set a foundation for future 
constitutional government. Armenia's economic accomplishments have been 
significant, and we are committed to supporting similar progress in the 
political sphere. We are also encouraging political reforms in 
Azerbaijan to match the initial advances in the economic arena, which 
have opened that nation to investment and monetary stability.

The United States will continue to work--both bilaterally and through 
international institutions--to encourage the states of the Caucasus to 
build on this beginning and to put in place the institutions, laws, and 
procedures needed to promote democratic practices, support a healthy 
economy, and attract foreign investment. Working with the Congress, our 
programs under the Freedom Support Act continue to provide technical 
assistance to help institute reforms and create opportunities for these 
new nations. We will also continue to work with the international 
community--including the developed European nations, international 
organizations like the UN, OSCE, EU, the World Bank, IMF, and other 
groups--to support their continued complementary efforts.

Finally, we will be mindful that Russia and Turkey, as neighbors with 
long historical relations to the region, can make a special contribution 
to the development of the Caucasus. Indeed, they, by reason of proximity 
and centuries of involvement in this area, bear a special responsibility 
to rethink old patterns and reassess old ideas about this region. The 
development of the Caspian energy resources offers an opportunity for 
the states of the region to cooperate in new ways for the mutual benefit 
of all. It is time for each of the area's neighbors to find the path to 
constructive engagement which contributes to the prosperity of the area 
and its neighbors while assuring and respecting the independence and 
security of the new states. In this effort, each will find the United 
States a willing and fair partner.

In this process, Turkey has a special role to play and is already doing 
so. I wish to note the remarkable activities by the Turkish private 
sector both in Georgia and in Azerbaijan. This is all the more 
noteworthy since it is a grassroots movement involving large companies, 
as well as deputies and businessmen from Eastern Turkey, who see 
opportunities for development. One example of many is the new, all- 
weather road being constructed from Trabzon to the Georgian border.

In the end, however, the success of these efforts will be tied to the 
capacity of the region's states and peoples to exploit for their common 
good the economic resources and strategic location of the Caucasus. 
Great courage, statesmanship, creativity, and wisdom will be required if 
this era of opportunity is to reach the promise of its potential.

The fact is that the immense potential of the Caucasus states will not 
be fulfilled unless or until the individual states are willing and able 
to work together. Bound together by history and geography, the states of 
the Caucasus must be prepared to work through their disagreements and to 
focus on their shared aspirations and assets if they are--individually 
and collectively--to be competitive. Their challenge at this point is to 
pursue regional cooperation while continuing to support reform and 
development efforts within each of their nations.

If cooperation is to become the norm rather than a goal, there will need 
to be a willingness to move away from old ways of thinking, where it was 
assumed that one group's loss is another's gain. Instead, it will be 
necessary to think consistently in terms of a win-win approach to 
development. 

In this regard, the United States is determined to support regional 
cooperation and encourage others to do so. We are committed to 
implementing a Caucasus Enterprise Fund and to finding creative ways to 
leverage the funds provided by Congress into a fund large enough to 
support significant investment across the region. We will also continue 
to support regional approaches to Caspian Basin energy development, and 
we already see evidence of the benefits that are produced through such 
efforts.

The accords signed to facilitate development of a western pipeline to 
transport early Caspian oil have already resulted in spin-off activities 
that only suggest the opportunities and benefits to the region that lie 
ahead. The revitalized transport corridor across Georgia and Azerbaijan 
has already been used to transport oil-production equipment from the 
Black Sea to Baku, and to move cotton from Uzbekistan to the Black Sea 
on its way to markets beyond. Other early-oil arrangements--including 
the route north through Russia and the first shipment by barge and 
railway from Kazakstan through Baku to Batumi--hold similar promise.

New trade patterns also serve as the basis for cooperation. Cut off by 
conflicts in Abkhazia and Chechnya from traditional trade partners in 
Russia, Georgia sought out new opportunities. Growing interaction with 
Turkey, which is now Georgia's primary trade partner, has spawned 
cooperation on a range of issues. Both countries have benefited. And the 
opening of the air corridor between Turkey and Armenia last year has 
given hope for the establishment of open borders and open trade across 
the land bridge between these two nations. This development holds the 
prospect for immense benefit to the region.

As trade patterns develop further and the network of cooperation spreads 
to include partners beyond the Caucasus, Turkey, and Russia--to include 
Central Asia, Western Europe, and beyond--the opportunities and 
potential benefits will multiply.

Just as trade networks develop naturally, following the path of least 
resistance, cooperative efforts work best and are most fruitful when 
they build on existing opportunities. In fact, as the examples above 
illustrate, it is very often the business community that first 
recognizes opportunities for cooperation and takes the lead in 
establishing linkages. Unencumbered by ideology and conditioned to see 
situations in terms of opportunities, the business community is often 
far less conservative than politicians. It can serve, therefore, a 
valuable role by both breaking down traditional constraints and 
encouraging interaction among the parties.

Recognizing the critical role of commerce as a catalyst for cooperation 
generally, we actively encourage U.S. firms to become involved in the 
Caucasus. The current trip of Department of Commerce Counselor and U.S. 
Ombudsman Jan Kalicki to Baku, Tbilisi and Yerevan is just one example 
of high-level contacts meant to strengthen commercial ties to the 
region. We are also actively encouraging the states of the Caucasus to 
take advantage of opportunities such as the WTO, which will bring 
immense trading benefits, accelerate economic reforms from intellectual 
property to insurance, and facilitate dialogue on a range of issues. An 
open trading regime is good--in and of itself. By facilitating 
cooperation, it also helps states take full advantage of the 
opportunities available to them.

The United States will continue to encourage the states of the Caucasus 
to pursue initiatives which will establish a foundation for cooperation. 
We stress the importance of beginning with and building on practical 
initiatives and focus on the transport, communications, and energy 
sectors as obvious areas in which to begin. Cooperation in these areas 
will produce tangible benefits, and it will help build confidence among 
the parties. We are committed to supporting specific initiatives in 
these areas, particularly those that are intended to include all three 
of the Caucasus states.

At the same time, the United States will continue to emphasize the 
importance of removing the major obstacle to such cooperation. Festering 
ethnic and regional conflicts effectively block cooperative efforts even 
on the most benign issues. They do so by encouraging the parties to 
think in terms of a zero-sum (you win; I lose) situation rather than 
considering the possibilities of shared benefits from cooperation. The 
ongoing conflicts in Nagorno-Karabakh, Abkhazia, and South Ossetia are 
quite literally robbing the states and the citizens of the region of 
opportunities that cannot be recreated. More than that, they undermine 
the potential for future cooperation. Furthermore, the perpetuation of 
these conflicts opens the region to potentially destructive involvement 
by outside players who see--as they have for centuries--in division 
chances to play out old rivalries or to gain unilateral advantage.

As with its contribution to economic development, Turkey's activities in 
regional conflict resolution also deserve mention. Turkey has been among 
the most active and most constructive members of the Minsk group--the 
OSCE body set up to mediate the Nagorno-Karabakh conflict. The activity 
takes place at all levels, including by President Demirel who, we 
gather, was to see Armenian President Ter Petrosian today in Moscow, on 
the margins of the Black Sea Summit meeting.

The United States will continue to press all parties to work 
constructively toward comprehensive, fair, and durable political 
settlements. Working with the international community--particularly 
through the UN and the OSCE--our goal is to help the parties bridge 
their differences. The settlements will have to be based on a shared 
commitment to compromise and fairness--and to respect for the rights and 
dignity of all if they are to endure.

We do not underestimate the difficulties in reaching such settlements. 
We understand there will be costs to all parties. What we ask is that 
the parties recognize the costs of not finding a means to resolve the 
conflicts. Benjamin Franklin, one of the Founding Fathers of the United 
States, pointed out to his colleagues during the debates that took place 
in Philadelphia over 200 years ago, "we must all hang together or, most 
assuredly, we will all hang separately."

The newly independent, sovereign states of the Caucasus face tremendous 
challenges, but they also enjoy remarkable resources and opportunities. 
They have each already overcome many obstacles to get to where they are 
today. What is needed now is a willingness to overcome the obstacles 
that remain in order to take advantages of the opportunities that lie 
ahead.

The United States will stay involved in the Caucasus because American 
interests call for our engagement. We will continue our effort to assist 
and encourage the states in the region and their neighbors to find paths 
toward constructive, cooperative development that will serve the 
interests of the young states of this ancient region as well as those of 
its neighbors and of the United States. Thank you. 

(###)




ARTICLE 3:

U.S. Policy Agenda for Latin America And the Caribbean
Jeffrey Davidow, Assistant Secretary for Inter-American Affairs
Remarks to the Inter-American Development Bank Forum on the Americas, 
Washington, DC, November 12, 1996

It is my great pleasure to be here. Cooperation with the Inter-American 
Development Bank is one of the pillars of our policy toward Latin 
America and the Caribbean, and I look forward to working very closely 
with the bank in the second term of this Administration.


Latin America and U.S. Policy

Three principal objectives guide U.S. policy in the region:

--  Strengthening democracy, the rule of law, and respect for human 
rights;

--  Combating the menace of the illegal drug trade, crime, migrant 
smuggling, and terrorism, as well as meeting new challenges such as 
environmental degradation and sustainable development; and

--  The objective I want to focus on today: promoting economic 
integration through an open and fair trade policy and the building of a 
Free Trade Area of the Americas--FTAA.

Overview of Progress to Date

As I look back over the past decade, it is clear to me that the region 
as a whole has achieved some extraordinary successes. Despite the 
inevitable turmoil of change, despite some unwelcome surprises--such as 
the Ecuador-Peru hostilities or the tragic aftermath of the Mexican 
devaluation--the region is stable and growing.

Freely elected and reformist governments are in place throughout the 
hemisphere. Most importantly, perhaps, the region's commitment to market 
economics within a democratic framework has been tested and found 
credible. Even the shock of the Mexican peso crisis, and its 
repercussions in the region, failed to reverse market-oriented policies.

The Summit of the Americas is one of the region's greatest successes. 
The unity of the hemisphere's leaders in support of the broad goals of 
democracy, economic integration, protection of the environment, and 
combating poverty is unprecedented. Without the unity and clarity of the 
Summit's vision, I am not entirely sure that the region's commitment to 
reform would have been as sturdy in withstanding the shocks and stresses 
of the past two years. 

There has been remarkable progress toward implementing the 23 
initiatives of the Action Plan established by our leaders in Miami. 
Specific achievements include the world's first anti-corruption 
convention; as well as agreements on cooperation to fight terrorism; to 
combat money laundering; and to establish a hemisphere-wide capital 
markets committee to liberalize financial markets, improve financial 
cooperation, and help reduce currency instability. There are also major 
initiatives underway for health and education and to clean up and 
conserve the environment. The latter will be an important theme at the 
upcoming Summit on Sustainable Development in Santa Cruz, Bolivia. 
Finally, we have made very substantial progress toward the Free Trade 
Area of the Americas, which I will address in a little more detail 
later.

I want to emphasize how important the Inter-American Development Bank--
IDB--has been in implementing the Summit program. In two of the Summit 
initiatives--to enhance micro-enterprise and to strengthen hemispheric 
infrastructure--the bank has taken on the overall coordinator role and 
fulfilled it with distinction. It also served as the very effective 
secretariat for another initiative--to strengthen capital markets.

And, of course, the bank's overall lending program has been crucial in 
promoting rational policies, honest and effective government, and well-
targeted social programs--all critical parts of the Summit program.

Challenges of the Future

Whatever the successes of the past, there are a great many challenges in 
the future. The biggest is to sustain the momentum of the reforms which 
are now underway. The past two years have shown that the reform process 
is not as fragile as some feared, but neither can we be confident that 
it is irreversible. While the momentum is there, what is not yet there 
is the full institutionalization of the reforms. Two simple examples:

--  Privatization is underway, but the regulatory structures for healthy 
competition in many economies are not in place;

--  Monetary and fiscal policies have been reformed, and many countries 
have implemented tax reforms. But efficient and honest administration, 
including tax collection, is still a challenge for many governments.

In this connection, I want to emphasize the importance of the IDB 
programs for modernization of government. Governments must stop doing 
what the private sector can do better. But governments must also do 
better what only governments can do--such as establishing the basic 
rules for both the political and economic games and providing a secure 
and fair environment in which to play those games.

Another challenge, and probably the most difficult single issue which we 
must address, is the region's persistent poverty. This is critical both 
to sustain political support for reform and to build a broad, modern 
base of consumers and workers for future growth.

I am not going to look at data or trends in poverty today. Reliable data 
on poverty are notoriously hard to come by. Whatever the scholars 
ultimately decide on these issues, one thing we do know now and for 
certain is that a very large proportion of Latin America's people live 
in conditions that are highly unhealthy and with extremely limited 
opportunities--probably more than a third according to several recent 
estimates, which amounts to well over 150 million people. 

The alleviation of poverty requires a well-targeted and comprehensive 
strategy. Over the long run, the most powerful single weapon against 
poverty is education. Enrique Iglesias summarizes years of research and 
experience on this issue across the world as follows:

The experiences of industrialized and developing countries alike 
indicate that education has been the cornerstone of economic and social 
progress attained by people everywhere. 

Most Latin American countries already have a commitment to universal 
education. The challenge is to provide practical access to quality 
education, especially at the basic level, in both rural and urban areas, 
to both girls and boys--and to ensure that limited resources are well 
used.

U.S. Policy Agenda

Our agenda within the second Clinton Administration closely tracks the 
issues I have just reviewed--democracy, market-based reforms, 
strengthening basic economic institutions, combating transnational 
threats, such as narcotics trafficking, and allevation of poverty.

As to particular initiatives, which the Administration will undertake 
over the next four years, it is clearly premature to get into specifics. 
However, I can share with you some of my general thinking about what we 
will need to accomplish.

First, we will continue to build on the Summit accomplishments. As you 
know, Chile will be hosting the next Summit of the Americas in early 
1998. Because we do not want to duplicate the Miami program based on the 
23 action initiatives, the Santiago Summit can focus on new initiatives 
(perhaps a half-dozen or so) which will address three priority areas: 
democracy and human rights, poverty, and economic integration. 

As in the case of the Miami Summit, the IDB--together with other 
multilateral organizations, business, academia, and other private sector 
organizations--will play key roles in implementing the program which our 
leaders will mandate for us in Santiago.

This brings me to a second focus for our work over the next few years--
making the FTAA a reality. As I have noted, there is already 
considerable movement toward that goal, including two successful 
ministerial meetings in Denver and Cartagena; the establishment of a 
private sector trade forum; and the formation of 11 working groups to 
collect and analyze data and develop recommendations for negotiating 
procedures in a wide variety of areas. 

Despite some skeptics' view that the FTAA initiative is stalled because 
of the lack of U.S. fast-track authority, I am convinced we have 
achieved a lot. For example, establishing an accurate and comprehensive 
data base may seem unimportant and technical, lacking drama or glory, 
but it is indispensable to the successful conclusion of negotiations.

At the third ministerial this coming May in Belo Horizonte, I anticipate 
that the ministers will determine when and how to launch formal 
negotiations. We want a decisive beginning in Brazil. We will have 
failed if by the time of the Santiago summit, we have not answered 
fundamental questions on goals and procedures.

A few words on fast-track: I recognize that the failure to pass fast-
track has been widely interpreted in the region as indicating that the 
U.S. has lost interest in the FTAA and lacks the political will to 
deliver on its promises. Clearly, this has been a set-back. But I can 
assure you that the President remains deeply committed to the FTAA and 
will be engaged in ensuring its success. We are aware of the importance 
of fast-track to a successful outcome for FTAA negotiations. Obtaining 
this authority by working with Congress in a bipartisan fashion will be 
one of the Administration's top priorities in this hemisphere.

Third, we must strengthen the civil foundations on which to build 
prosperity, continuing our efforts to build peace and reconciliation:

In Guatemala, the support of the U.S., other international "friends," 
and the UN is helping the parties reach a final settlement to their 36-
year civil war.

Between Peru and Ecuador, the U.S., Argentina, Brazil, and Chile are 
strongly supporting direct negotiations to find a just and lasting 
settlement to a border dispute which flared into open conflict less than 
two years ago.

We must also continue our efforts to strengthen democracy and the rule 
of law: In Haiti, the U.S.-led Operation Uphold Democracy directly 
restored a democratic government. We are also working in less dramatic 
ways to nurture new democratic institutions, to share our experience on 
the appropriate role of the military in a civil society, and to 
strengthen the administration of justice and rule of law. The IDB has 
been extraordinarily helpful in Haiti. On Cuba, we are committed to 
challenging peacefully the Cuban Government's 37-year reign of tyranny 
and denial of basic individual and political rights.

Fourth, we must address the transnational threats to economic and social 
development, such as environmental degradation and crime.

Protection of the environment will continue to be high on our agenda for 
the region. Under Secretary Christopher's leadership, the Department of 
State has been working to integrate environmental issues into all 
aspects of U.S. foreign policy. We are creating regional environmental 
hubs--one of the first will be in San Jose, Costa Rica--to support our 
diplomacy, address transboundary pollution issues, and better coordinate 
our efforts.

One of the greatest threats to our objectives in the hemisphere is 
transnational crime, particularly narcotics trafficking and related 
activities such as money laundering. These criminal activities 
increasingly support violence and terrorism, undermine fragile 
democratic institutions, distort economies, and hinder long-term 
economic growth. The counternarcotics fight requires the fullest 
cooperation of all nations in the hemisphere.

Conclusion

Let me conclude by noting that, in my view, U.S. policy toward Latin 
America today is unusually strong and resilient. We share with Latin 
America a clear vision of where we want to go. We have a common strategy 
to achieve that vision which is specific and comprehensive. And we have 
an ongoing dialogue among governments and with the other key players of 
this hemisphere's societies, which ensures that our goals and our 
strategies reflect changing realities. I view today's meeting as part of 
that dialogue, and I welcome your comments.

(###)

[END OF DISPATCH VOL 7, N0. 46]

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