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Summary: The 46th Annual Washington Conference on the Americas - Advancing an Agenda for Growth

Juan Carlos Varela speaks at the Washington Conference on the Americas 2016

Panamanian President Juan Carlos Varela (Image: Mark Finkenstaedt)

May 03, 2016

Panama will enter agreements w/ several countries to exchange tax info, said @JC_Varela at #2016WCA. #panamapapers
“I’m confident it can happen this year." —@PennyPritzker on passing #TPP at #2016WCA

Speakers:

  • Juan Carlos Varela, President of Panama
  • John Kerry, Secretary, U.S. State Department
  • Penny Pritzker, Secretary, U.S. Commerce Department
  • Luis Carlos Villegas, Colombian Defense Minister
  • Martín Lousteau, Argentine Ambassador to the U.S.
  • Carissa F. Etienne, Director, Pan American Health Organization
  • Sri Mulyani Indrawati, Managing Director and Chief Operating Officer, World Bank
  • Nathan Sheets, Undersecretary for International Affairs, U.S. Department of the Treasury
  • Fernando Aportela, Undersecretary of Finance and Public Credit of Mexico
  • Roberta Jacobson, Assistant Secretary for Western Hemisphere Affairs, U.S. State Department
  • Andrés Gluski, Chairman, Americas Society/Council of the Americas
  • Susan Segal, President and CEO, Americas Society/Council of the Americas
  • Eric Farnsworth, Vice President, Americas Society/Council of the Americas

As a grassroots, anticorruption movement swells in Latin America and the Caribbean, the region’s governments are responding—and they’re not just paying lip service. Government accountability and transparency were recurring themes throughout the day at the 46th annual Washington Conference on the Americas.

The event, cohosted by Council of the Americas and the U.S. State Department, opened with welcoming remarks by AS/COA Vice President Eric Farnsworth. Then, AS/COA President and CEO Susan Segal introduced Roberta Jacobson, newly confirmed as the U.S. ambassador to Mexico.

In her final days as assistant secretary of state for Western Hemisphere Affairs, a post she’s held since 2012, Jacobson outlined the State Department’s top priorities for the Western Hemisphere. At the top of the list, she said, is expanding North American cooperation with Canada and Mexico, especially in regards to climate, energy, and the Trans-Pacific Partnership (TPP).  Other priorities include supporting the Colombian peace processes and democratic elections in Haiti, continuing to reestablish what she called “genuinely normal” relations with Cuba, and the release of Venezuelan political prisoners. She gave a plug for State’s 100,000 Strong in the Americas initiative, which fosters educational exchange for students, and closed by quoting Chilean President Michelle Bachelet on the importance of combatting corruption and working for more transparent governance, saying, “[P]eople are demanding more from their governments and have developed an acute awareness that the quality of democracy can only be strengthened through combatting corruption in the public and private sectors.” She also comments on the imprisonment of opposition members in Venezuela.
 

AS/COA Chairman Andrés Gluski introduced the afternoon’s keynote speaker, Panamanian President Juan Carlos Varela. He touted his country as a destination for foreign business, noting that more than 100 international organizations have opened offices in the Central American country. But in addition to business, this has also attracted some negative attention via the recent Panama Papers scandal, in which one Panama City-based law firm was revealed to have helped hundreds of clients set up offshore accounts with the alleged aim to evade taxes. Varela addressed the issue head-on, and said that Panama would be entering into bilateral agreements with several countries to exchange tax information and ensure that all companies operating within its borders were doing so in compliance with Organization for Economic Cooperation and Development standards. The commitment to transparency is critical to the democracy, he said.

The afternoon sessions opened with an interview of U.S. Secretary of Commerce Penny Pritzker by the Financial Times’ Shawn Donnan. They discussed TPP, a hallmark of Pritzker’s tenure. The agreement, approved last year by the 12 member countries, lowers tariffs on U.S. goods and significantly raises labor and environmental standards, said the secretary. She said this, in turn, raises standards globally and makes businesses more competitive.

That said, the measure has yet to pass the U.S. Congress, and Republican lawmakers have vowed they will not consider it in 2016, a presidential election year. Still, said Pritzker, “I’m confident it can happen this year. Now is the window.” Despite pushback against free trade from some presidential candidates, “Trade is imperative. We can’t build a fence around our country,” she said.

The conversation then shifted to Cuba. Pritzker, who made two trips in the last six months, said recent regulatory shifts enacted by the Obama administration have allowed for more engagement. That engagement, she argued, is the crux for future growth and what would ultimately serve to put pressure on the U.S. Congress to lift the embargo on the island.

Wrapping up with comments on globalization, Pritzker acknowledged that not everyone feels its effects equally, and for that reason workforce training should be a priority. “We need to do a better job,” she said. “We owe people the right skills, training, and opportunity.”

Next up, Segal interviewed Argentine Ambassador to the U.S. Martín Lousteau. They discussed what’s next on President Mauricio Macri’s economic agenda after a whirlwind start in office. When Segal asked if the country was looking to enter into any other trade blocs beyond Mercosur, Lousteau said that, given that the country just exited out of a decade and a half of default in March, it might take some time before it looked to expand its reach again. “We first have to rebuild our muscle before going into another agreement,” he said. 

Then, former Colombian Foreign Affairs Minister Carolina Barco interviewed Defense Minister Luis Carlos Villegas about the country’s peace processes with rebel groups, AND most notably with the Revolutionary Armed Forces of Colombia (FARC). Barco asked Villegas what the role of the state’s armed forces would be after an agreement. “The first public good to bring to people is security,” said Villegas, arguing that the temptation of other groups, such as the National Liberation Army, to fill the power vacuum in the wake of the FARC’s demobilization would be huge, and for that reason, a stronger—not weaker—military will be needed post-conflict. He said that the military would carry out peacekeeping efforts in the rural areas, while local police forces would do so in urban and suburban ones.

The conference then switched topics to public health, with an interview of Pan American Health Organization (PAHO) Director Carissa Etienne by Farnsworth. They opened with the most-discussed regional health issue of the year: Zika. The virus is set to cost Latin American and Caribbean countries $3.5 billion this year, or 0.06 percent of regional GDP, she said. As an April PAHO report recently revealed, there is a second mosquito species that carries the disease. Stopping the insect—which also carries dengue and chinkungunya diseases—should be the main target, said Etienne. “We need to have some ways of reducing mosquito populations, or else we’ll continue to have outbreaks every two years,” she said. She also spoke about the importance of stopping noncommunicable diseases (NCDs), and tobacco use in particular. She noted that 1.5 million people in Latin America and the Caribbean die of NCDs between the ages of 30 and 59, i.e. at an age when they are most productive, which negatively impacts local economies.

To close the afternoon sessions, attendees heard from a panel with Mexican Finance and Public Credit Undersecretary Fernando Aportela, World Bank Managing Director and COO Sri Mulyani Indrawati, and U.S. Treasury Undersecretary for International Affairs Nathan Sheets. John Lipsky, formerly of the International Monetary Fund, moderated the discussion. Aportela noted Mexico’s relatively strong macroeconomic performance was related to moves to lessen the country’s dependence on oil revenues. Sheets highlighted a region-wide improvement in the quality of macroeconomic policies. Indrawati expounded on her commitment to structural reforms as keys to growth. While the region currently faces grim prospects for growth in the short term, there are hopeful signs. “It’s not Mission: Impossible,” said Lipsky. “We’ve seen it done before.”

The evening concluded with keynote remarks from U.S. Secretary of State John Kerry, introduced by Ambassador and AS/COA Chairman emeritus John Negroponte. In addition to advocating for expanded regional trade and greater support for entrepreneurs, Kerry stressed the importance of the anticorruption movement. “Now more than ever, citizens all around the world are making clear to everybody that corruption is not going to be tolerated,” said Kerry, arguing that corruption not only robbed citizens of monies, but also of trust in their governments.

Given that the conference took place on the eve of the Central American and Caribbean Energy Summit, Kerry also highlighted the significance of the Paris climate agreement—which he signed for the United States at the UN with his granddaughter on his lap. “This is an enormous signal to the global marketplace that this is the future,” he told the audience in the Benjamin Franklin State Dining Room. “The energy market is the future. The choices we make with respect to energy are going to define whether your country is up or down.”