Good afternoon.  I welcomed the chance to meet today for the fourth time with my fellow G-7 Finance Ministers and Central Bank Governors.

Strengthening global growth must be the top priority for the G-7.   I repeated that strong message today.   Growth in the major economies, in Europe, and in Asia, is simply not what it could be.  We need to do more to ensure a robust global recovery and to promote higher growth rates in our economies and I was pleased the communiqué came out so strongly in support of this idea. 

The United States has taken legislative action, proposed by President Bush, to strengthen the U.S. recovery. That legislation is clearly beginning to take affect. After a series of shocks that included terrorist attacks, corporate scandals, and a recession, the U.S. economy is finally accelerating.

I made clear today that the United States can not be the sole engine of world growth,  others need to take bold actions themselves – including fundamental structural reforms where necessary – to spur domestic led growth, create jobs and contribute to global prosperity. This is the very same growth message I have taken to Europe, Asia and across the world on my global growth campaign and I was pleased to see the G7 for the first time come together on this point.

But I also made clear the U.S. leads by example, and with actions, not just words.  Thus, we are continuing to act to strengthen our economy and create jobs. 

Earlier this month, President Bush unveiled a six-point plan for ensuring the economic success we all want to see, which I reviewed with my colleagues in some detail.  Under the President's plan, we will take the following steps to create the conditions in which employers will hire more workers and our economy will continue to grow.

First, we are working to make health care more affordable and its costs more predictable, so employers can add new workers without also adding a large and uncertain burden from health care costs. 

Second, we are working to prevent frivolous lawsuits from diverting money from job creation into legal battles. 

Third, we are working to build a more affordable, reliable energy system that can support the expansion of our economy.

Fourth, we are streamlining regulations and needless paperwork requirements that reduce business productivity and deter growth.

Fifth, we are opening new markets to high value American products and bringing down prices for American consumers through trade agreements.

And lastly, number six, we are working to make tax relief permanent, so businesses and families alike can plan for the future with confidence.

We have an ambitious agenda for maximizing economic growth and job creation in our country.  These actions, together with President Bush’s previous stimulative measures, will take the U.S. economy through the recovery stage, and move to a new level of expansion, prosperity and success.  I urged my G7 colleagues to embark on their own appropriate and equally ambitious agendas and they were quite receptive. 

Throughout my meetings we had extensive discussions on the issue of currencies.  I expressed my long-held view that the world trading system works best under a regime with market based exchange rates.   I was pleased the communiqué reflected this view.

The need for action, however, extends beyond the G-7.   All countries need to strengthen their policies and implement reforms aimed at achieving growth.  We all benefit when the international financial system relies on the principles of free trade, free capital flows, and market based exchange rates among the major economies. 

Trade, and its importance to global prosperity, was discussed.   I was very disappointed with the collapse of the WTO talks in Cancun, Mexico earlier this month.  To reaffirm our views on global trade, I made this point crystal clear today: the United States supports free trade because a world that trades freely will grow in prosperity.    For developing nations, free trade tied to economic reform has helped to lift hundreds of millions of people out of poverty. The growth of economic freedom and ownership in developing countries creates the habits of liberty and creates the pressure for democracy and political reform. Also, of course, we support free trade in America because it creates jobs.  It's vital to the success of our economy.  I made clear to my colleagues and reiterate here that the United States stands ready to work with others who seek trade liberalization.     

Economic and financial crises can disrupt our drive for sustained growth.  I am pleased that spreads in emerging markets are down, and that there have been fewer crises, and that capital flows are up.  I am also pleased that we have made progress on policy changes that improve predictability in emerging markets.   The establishment of collective action clauses as a market standard is a critical step forward. 

Yet we all agreed today that there is more to be done to make the IMF as effective as it needs to be.  In particular, I underscored the need for IMF to address currency mismatches in assessing its members’ economies.  The IMF also needs to focus its lending on countries truly committed to reform.  The United States and others in the G-7 strongly support recent steps to enhance IMF transparency.  Today, we underscored in particular the importance of disclosing all IMF documents – especially the exceptional access reports that justify large scale lending.

Promoting growth and job creation is the single best way that we can help developing countries.  In the spirit of Monterrey, the G-7 continues to work to improve development assistance through a results-based approach that focuses on countries implementing credible reforms.  We highlighted today the need for these countries to address structural weaknesses and governance issues.  I also emphasized the need for the World Bank to reflect the priorities of development and growth in their administrative budgets. 

Turning to Iraq and Afghanistan, my colleagues and I discussed the enormous but critical task of supporting reconstruction and recovery.  Over the last week, as I traveled through Israel, Jordan, Saudi Arabia, Afghanistan and Pakistan, I have had extensive discussions on this topic with the leaders of this region.

While there has been important progress, much work remains to lay the foundation for private sector- led growth and to bring meaningful improvements to the Iraqi and Afghan people.  President Bush has indicated our commitment to providing very substantial sums in support of this effort.  I urged others to rise to the challenge of helping both countries with the task of reconstruction.  And, to help provide a sound footing for the future, we in the G-7 have pledged to seek a solution to Iraq’s debt problem by the end of 2004.   Tomorrow morning, I will meet with the new Iraqi Finance Minster Al-Kilani for the first time.    During that meeting, I will underscore our dedication and commitment to rebuilding Iraq for the people of Iraq.

In addition to our normal meeting, I am pleased the G-7 had the opportunity to meet together this morning with Palestinian Finance Minister Fayyad.  I met with Minister Fayyad last week to underscore with him President Bush’s vision of peace and prosperity for the Middle East, and for both the Israeli and Palestinian people.

We fully support the Palestinian Authority in its efforts to bring peace and economic stability and prosperity to the Palestinian people.  Toward this end, the United States will continue to provide budgetary support and other aid to the Authority to help insure that it can effectively conduct normal government functions.  During our meeting today, I called on others in the G-7 to provide similar support. 

Finally, I am eager to sit down this evening with Finance Ministers from countries engaged in the fight against terrorist financing.  In the past two years, we have made important progress in protecting the world’s financial systems from abuse by terrorists – thanks to the hard work of many countries, the FATF, and the IMF and World Bank.  I look forward to the Fund and Bank making terrorist financing/money laundering assessments a permanent part of their surveillance and oversight function.  I will also press during our dinner discussion for broad support for measures to ensure that the informal sectors are not alternative havens for the flows of terrorist funds.  I will encourage steps to make sure charitable donations go for worthy causes and not to support terror.  These steps are important counterparts to our continuing effort to deny terrorists access to the formal networks of international finance.

Thank you.