40th Washington Conference on the Americas

• Hillary Clinton, U.S. Secretary of State
• Arturo Valenzuela, U.S. Assistant Secretary of State for Western Hemisphere Affairs
• Jaime Bermúdez, Foreign Minister, Colombia
• Juan Carlos Varela, Vice President and Foreign Minister, Panama
• José Antonio García Belaúnde, Foreign Minister, Peru
• Ambassador Antônio de Aguiar Patriota, Deputy Foreign Minister, Brazil
• José Miguel Insulza, Secretary General, Organization of American States
• Lawrence Cannon, Foreign Minister, Canada
• Luis Guillermo Plata, Minister of Trade, Industry, and Tourism
• Ambassador Ron Kirk, U.S. Trade Representative
• Javier Lozano, Secretary of Labor, Mexico
• Hilda Solis, U.S. Secretary of Labor

Hillary Clinton, U.S. Secretary of State

As the opening speaker at the 40th Annual Washington Conference, U.S. Secretary of State Hillary Clinton talked about the primacy of hemispheric issues on the Obama administration’s agenda. She noted, “the Western Hemisphere always stays at the top of the list. I always am thinking about what more we can do to enhance partnerships.” During her remarks, she stressed three priority areas for cooperation between the United States and Latin America: trade and energy partnerships, public security, and inequality and immigration.

• Read U.S. Secretary of State Hillary Clinton's remarks at the 40th Washington Conference.
• Watch a video of the secretary's remarks.

“This hemisphere, particularly Latin America, is doing better than average,” she said, pointing to GDP growth. But, in opening with a discussion on trade, she expressed regret over the fact that trade agreements with Colombia and Panama remain stalled in the U.S. Congress. “Both Panama and Colombia have worked hard to deal with some of the questions raised,” she said, asking for support from the private sector. “We are going to pursue this. It is something that the president and I feel very strongly about,” she added. In addition to trade, Secretary Clinton discussed energy as an area to increase prosperity in the region, pointing to the Energy and Climate Partnership of the Americas. “We believe that we can do so much more on energy and climate and we need your help on that as well,” she said, stressing the role of the private sector.

A second area of concern stressed by the secretary was public security. “Our friends from Colombia have waged a heroic and largely successful struggle…but it’s not over,” she said. “This is a huge threat to the governance and the economies and the quality of life throughout Latin America, but particularly Central America and Mexico.” She referred to the “barbarism” of organized crime syndicates, commenting on Washington’s support for Plan Colombia and the Merida Initiative, but also urged for “smarter, more effective strategies.”

Third, Clinton referred to the twin issues of inequity and immigration. “We don’t have the poorest people in the world in Latin America, with the exception of Haiti, but we have the most inequity,” said the secretary. “Therefore we need to have a partnership between the public and private sector to address this.” In particular, she spoke of the need to increase tax revenues in the region. “We can take a lot of joy in the positive GDP growth, but income disparity continues to grow,” she said, noting it is “a source of social and political instability” that feeds criminal activity. “We have to do a better job.”

The secretary also discussed rebuilding Haiti. She pointed out that clean, safe drinking water is now available to more people than prior to the earthquake and called for reconstruction efforts to improve on conditions before the earthquake.

In closing, she solicited support from the private sector on hemispheric issues. “I am committed to doing everything I can to having this hemisphere be a model and combine our strengths and overcome our weaknesses,” she said. “I welcome your thoughts about how we in the Obama administration can be more successful at doing that.”

Arturo Valenzuela, U.S. Assistant Secretary of State for Western Hemisphere Affairs

In ensuing remarks, Assistant Secretary of State for Western Hemisphere Affairs Arturo Valenzuela reinforced areas highlighted by the secretary. He said “four baskets are the key baskets that we’re looking at.” These consist of: boosting prosperity and social inclusion via trade and competitiveness, facing the challenge of public insecurity, addressing energy issues and climate change, and strengthening institutions. Assistant Secretary Valenzuela pointed out that relations must be of a multilateral rather than bilateral nature. To foster such relations, he stressed the principles of dynamic multilateralism, mutual respect, and co-responsibility.

Foreign Minister Discussion

Speakers

• Jaime Bermúdez, Foreign Minister, Colombia
• Juan Carlos Varela, Vice President and Foreign Minister, Panama
• José Antonio García Belaúnde, Foreign Minister, Peru
• Ambassador Antônio de Aguiar Patriota, Deputy Foreign Minister, Brazil
• Moderator: Ambassador John Negroponte, Chairman, Americas Society and Council of the Americas

Each of the foreign ministers focused on the importance of partnership to achieve foreign policy priorities and the inherent link between a strong domestic and foreign policy. According to Minister Bermúdez, “there is no better foreign policy than a strong domestic policy.” Two additional themes emerged from the discussion: the necessity of promoting overall global integration through mechanisms such as free-trade agreements (FTAs) and cross-border initiatives to confront narcotrafficking, security, and other shared policy challenges.

The last few years—even with the global economic turmoil—have allowed for far-reaching domestic achievements. In Panama, according to Vice President Varela, the government of President Ricardo Martinelli has focused on social reforms, infrastructure investment, and basic service improvements. One area of particular focus is education, where new national scholarships are allowing an unprecedented number of students to access higher education, and at the same time an education reform is raising the overall quality of teaching.

In Peru, Foreign Minister Belaúnde emphasized how President García’s policies have helped yield a 10 percentage point decline in the poverty rate since 2006, which now stands at 36 percent. This comes at a time of continued GDP growth and job development; “good jobs are the best social program,” said Minister Belaúnde. Like Peru, Brazilian GDP growth remains strong and is expected to reach 6-7 percent this year—above the 4.5 percent regional average. But even with Brazil’s impressive domestic achievements, Deputy Foreign Minister Patriota noted some challenges: high social inequality, unsustainable environmental development, and an overly complicated tax system. All four countries represented share a common commitment to economic growth that benefits the entire population with prosperity shared throughout society.

The foreign ministers also outlined how their countries are working in partnership across the region to address mutual challenges. Colombia’s share of world cocaine exports have declined significantly (approximately 30 percentage points) and its successes in fighting narcotics networks and in strengthening law enforcement institutions are being shared with countries encountering similar challenges to the rule of law and to their institutions. Likewise, Minister Patriota pointed out Brazil’s long-standing commitment to Haiti—both as peacekeepers and as financial contributors to the country's reconstruction fund. Overall, he said that integration initiatives like Unasur, Sica, and Caricom are a result of stronger democracies and social progress. But the main challenge, according to Minister Varela, is for countries to collaborate in fighting drug trafficking and in improving security. “Governments cannot be threatened by traffickers,” he said.

U.S. ratification of the free-trade agreements with Colombia and Panama would facilitate these countries' efforts to improve domestic conditions and to create greater opportunities for their people. “Free trade generates jobs” that provide legitimate alternatives to the illicit drug trade, said Minister Bermúdez. At the same time, FTA ratification also sends a political message to.

Peru differentiates itself from its regional neighbors with its strong Asia-oriented trade policy. Twenty-eight percent of Peruvian trade is with the U.S., but the country is also a member of APEC and has a FTA with China, and is negotiating trade agreements with Japan and South Korea. Meanwhile, Brazil’s global trade increased 245 percent since 2003, with its Mercosur-focused trade jumping 350 percent.

Free-trade policies that build labor capacity at home are clearly the key to future prosperity. Overall, more robust trade policies “are not magic but have big advantages” such as increasing overall investment, said the Peruvian Foreign Minister. But the success of this investment will be defined by the improvements made in people’s everyday lives.

José Miguel Insulza, Secretary General, Organization of American States

The OAS secretary general gave an outline of the democratic progress made in Latin America in recent decades, adding that support for democracy in the region continues to grow even during recent difficult economic times. Although he remarked that strides have been made in terms of human rights, he noted several areas in need of improvement. Specifically, he pointed out that freedom of expression remains at risk, given lack of access to media ownership and physical violence against journalists, in large part due to organized crime.

The secretary general stressed that, in spite of progress, poverty and crime remain of pressing concern in the region. A third of the population remains poor, while 3 to 5 percent of the population controls the wealth in many cases, he said. In some parts of Latin America, crime rates are among the world’s highest. “Arms trafficking to the region has strengthened this threat and made the jobs of policing much harder,” he said.

To that end, Insulza said the OAS role in the region is to support Latin American stability and mediate in times of stress or conflict. He emphasized that the OAS must remain multilateral and can not engage in intervention. He noted that democracy can be strengthened through dialogue, engagement, and strengthening democracy.

The secretary general also raised the issue of two hemispheric countries that are not part of the OAS: Cuba and Honduras. While Honduras’ membership was suspended as a result of the June 2009 overthrow of then-President Manuel Zelaya, Insulza expressed hope that, now that the country has a democratically elected leader, it will soon return to the fold. “We agreed on everything on dealing with the crisis,” said Insulza. “But there was one thing on which there was not: recognition of elections. That’s weighing on the country.” He said the country is now paying a price from economic isolation that is harming Hondurans.

On the question of Cuba’s membership, he urged democratic reforms and said: “It’s their problem, not ours.”

Lawrence Cannon, Minister of Foreign Affairs, Canada“Protectionism is the single biggest threat to a thriving global economy, and free trade is the only viable alternative to protectionism,” said Canada’s Minister of Foreign Affairs Lawrence Cannon in remarks covering Ottawa’s relations with Latin America and bilateral relations with the United States. He outlined Canada’s foreign policy priorities which include: pursuing economic opportunities; boosting relations with Washington reinforcing international security, in particular through activities in Afghanistan; Arctic sovereignty; and hemispheric engagement.

• Read Canadian Minister of Foreign Affairs Lawrence Cannon's remarks at the 40th Washington Conference.

Cannon stressed the importance of trade liberalization, noting that Canada believes “that responsible investment and open markets will build dynamic and growing economies, with the creation of new opportunities and jobs.” The minister pointed out that Canada achieves this in the hemisphere through NAFTA as well as with trade pacts with Chile, Costa Rica, and Peru. Moreover, Canada is working to implement a trade accord with Colombia, negotiations have concluded with Panama, and continue with the Caribbean Community, Guatemala, Honduras, Nicaragua, and El Salvador.

In terms of bilateral relations with Washington, the minister pointed out that the United States and Canada have the largest two-way trade partnership in the world, at $1.8 billion per day. “More than 8 million U.S. jobs are directly supported by trade with Canada,” said Cannon, noting that Canada is the United States’ top energy supplier.

In closing, he urged the United States ratify the UN Convention on the Law of the Sea and emphasized Canadian sovereignty in the Arctic. “Since title is not linked to the extent of the ice cover, it is consequently undiminished by any reduction of the ice,” said the minister. “I believer there is no reason why Canada and the United States cannot resolve ongoing disputes, as economic partners and best friends, sharing the longest border in the world.”

Luis Guillermo Plata, Minister of Trade, Industry, and Tourism, Colombia
Colombia has experienced a turnaround in terms of economy and security since 2002, and Minister Plata offered an overview of the positive changes witnessed during his tenure in the Uribe administration. In particular, given his leading role in the fields of trade and tourism, he said, “[w]e’re going to continue to move forward and engage in the world.”

Minister Plata gave a number of specific examples of improvements in Colombia. Since 2003, exports tripled, and while the country only had two free trade agreements in place then, it now has 11 with 49 countries. Foreign direct investment in Colombia is at an all-time high. He also cited security improvements, such as a decrease in the overall homicide rate, as well as in the murders or trade unionists—from 196 killed in 2002 to 28 in 2009.

However, the minister noted several areas where need for improvement exists. Notably, Colombia continues to wait for the U.S. Congress to approve the bilateral trade agreement, signed by both countries in 2006. In response to a question from Ambassador John Negroponte regarding the cost of stalling approval, Plata noted that 6,000 Colombian products can enter the U.S. market tariff free. Yet, because of tariffs on U.S. goods entering the Colombian market, U.S. agricultural goods such as wheat, barley, and corn have lost 50 percent of their Colombian market share to countries such as Argentina and Brazil. He noted that given that other countries in the hemisphere already have trade agreements with the United States, it leaves Colombia with a the sense that “it’s almost like you’ve been downgraded.”

Plata also explained that Venezuela’s trade embargo on Colombia, imposed after Bogota signed a military pact with Washington in July 2009, caused Colombian exports to Venezuela to drop from $6 billion to $4 billion last year. The drop continues, with a 70 percent decrease in exports to Venezuela this year.

As a result, Plata stressed the need to diversify trade and economic partnerships, and said that his country hopes to see a trade pact with Canada gain parliamentary approval soon. He added that Colombia is also seeking to expand agreements beyond the hemisphere, to Europe and Asia.

Ambassador Ron Kirk, U.S. Trade Representative
“Some of our strongest relationships, both strategically and commercially, are…in the Americas,” said U.S. Trade Representative Ron Kirk, speaking at the conference. Ambassador Kirk spoke on the Obama administration's support of approval of Washington’s bilateral agreements with Panama and Colombia, while maintaining labor rights and environmental standards. The ambassador emphasized that trade cooperation can support job creation in the United States and in partnering countries. “In every case, our goal with all of our trading partners is to build mutually beneficial trade relationships,” he said.

“I get asked everyday: ‘When, when, when,’” said Kirk in reference to calls to approve bilateral trade agreements. He acknowledged that gaining acceptance for trade agreements presents a communications challenge. “The benefits are so diffuse…that many don’t realize the benefits,” he said. The ambassador pointed out that U.S. President Barack Obama’s National Export Initiative, designed to create domestic jobs, seeks to double U.S. exports. “If we’re going to do that we’re going to need Panama, we’re going to need Colombia, we’re going to need Korea, we’re going to need the Trans-Pacific Partnership,” said Kirk.

The ambassador highlighted other U.S. efforts to engage the region on trade, pointing to the success of the U.S.-Peru trade agreement, NAFTA, and CAFTA-DR as well as the resolution of the U.S.-Brazil cotton dispute.

In closing, he highlighted the “Plus One for Haiti” program, which encourages U.S. retailers to have 1 percent of their total apparel production in Haiti.

Javier Lozano, Secretary of Labor, Mexico

Mexico—even during this time of global economic uncertainty—continues to maintain fiscal discipline and move forward with policy reforms that will be essential to the country’s long-term competitiveness.

Counter-cyclical programs, for example, have helped to lower the rate of job losses when compared to previous economic downturns. In the mid 1980s, for example, a 6.2 percent drop in GDP translated into an 8.2 percent decline in employment. Last year, a similar GDP loss yielded a 4.1 percent drop in the employment rate.

But Secretary Lozano noted that positive economic news is again emerging from Mexico. The economy grew in the last three quarters, and GDP is forecast to increase 4-5 percent this year. On top of that, 225,000 manufacturing jobs were created from August 2009 to April 2010, and the first four months of this year saw the creation of 85,000 construction jobs. Today, Mexico has the third lowest unemployment rate among all OECD members.

But “urgent legal reforms” are needed to guarantee the country’s future competitiveness. The government of President Felipe Calderón is focusing on overarching political reform, anti-trust and economic competition legislation, and the overhaul of its legal labor framework. The labor legislation is one of the government’s top priorities as the 40-year-old law must be rewritten to improve efficiency and to “create jobs at home.” Despite the necessity of these reforms, passage is uncertain in an opposition-controlled Congress.

Cooperation with the U.S. and other partners is critical to defeating the traffickers but this collaboration must be strengthened and extended to other areas, including immigration. Secretary Lozano emphasized that defeating the narco-traffickers is a cross-border problem noting that “no society is free of the threat from illegal drugs.”

But partnership between the two countries should also extend to the way people are treated outside their borders. According to Secretary Lozano, Arizona’s SB 1070 law creates “spaces for misapplication of the law based on racial profiling.” To protect Mexicans the government “will use all its resources to defend the rights” of its citizens living in Arizona.

Hilda Solis, U.S. Secretary of Labor

Economic growth over the last five months in sectors such as health care, manufacturing, and construction helped lead to the creation of 290,000 jobs in April alone—a sharp reversal from January 2009 when more than 750,000 jobs were lost. Despite the job gains, the unemployment rate still remained high at 9.9 percent in April.

• Read an Americas Quarterly blog post about Secretary Solis' focus on immigration.

But one of Secretary Solis’ main concerns is the 12.5 percent unemployment rate among the Latino population. Latinos—who Solis termed the “new entrepreneurs”—are the fastest growing demographic in the U.S. and will account for over 25 percent of the population by 2050. This population, however, accounted for only 5 percent of the 3.6 million STEM (science, technology, education, and math) jobs in 2008. Solis and the Department of Labor are focusing on creating more of these jobs for Latinos as STEM fields are the future of innovation and competitiveness.

Latino workforce development also extends to training workers in the renewable energy sector and to breaking down the barriers between employers and employees. The Department of Labor has launched a multilingual help line as a resource for workers that have been unfairly treated on the job and is focusing on bringing to light “good business practices” that help to prevent on-the-job injuries. Just recently Secretary Solis and Mexican Ambassador to the United States Arturo Sarukhán signed a declaration reaffirming their joint commitment to work collaboratively on informing Mexican workers about their labor rights. She hopes to extend this type of agreement to El Salvador, the Dominican Republic, and other Latin American countries.

On immigration reform, Secretary Solis reiterated President Obama’s call to move the immigration agenda forward as part of a package that “goes beyond party lines.” Without reform, the states are taking on what is federal policy. Solis emphasized that she “doesn’t agree with what’s happening in Arizona,” highlighting that “immigrants are great contributors to our economy and will continue to be.” She called for “changing the direction of our immigration policies” so that talented immigrants with graduate degrees are not left behind without the ability to secure a job. However, to enact reform, the business community will need to be vocal and provide their full support.