Secretary's Speech

Secretary of Commerce Carlos M. Gutierrez
A Preview of the 2008 Americas Competitiveness Forum, August 17-19 in Atlanta, Ga.
Foreign Press Center Building
Washington, D.C.

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MODERATOR: Good afternoon, and welcome to the Washington Foreign Press Center. Today, we have with us the U.S. Secretary of Commerce Carlos Gutierrez, and he's going to talk to you about the America Competitiveness Forum. So please remember -- he'll give brief opening remarks, and then please remember, when you have a question, to state your name and news organization, to ask the question. Thank you.

Secretary Gutierrez, thanks for joining us.

SECRETARY GUTIERREZ: Thank you. Good afternoon.

Nearly 1.000 Western Hemisphere leaders, including President Uribe from Colombia, President Colom from Guatemala, and President Saca from El Salvador will be convening in Atlanta, Georgia, next Monday for the second Americas Competitiveness Forum. This is a regional forum. It is the second time we've done it. We found the first time we had great participation. People come together from the private sector, from the public sector, from over 20 countries, and discuss how we can make the hemisphere more competitive.

But very importantly, it's done in a way where countries bring forward lessons, things they have done that have made them more competitive. So it's really a place to learn from other countries. As opposed to just learning from one country, everyone is learning from everyone else. There is broad understanding that regional engagement through trade partnerships and cooperation can improve our global competitiveness and raise standards of living throughout the hemisphere.

At this year's forum, we're going to be addressing policies and strategies that promote development and economic growth. So we will share best practices on four topics. One is alliances in business and education, renewable energy and sustainable resources, trade logistics, and travel and tourism in the Americas.

We're honored to have such high-level participation. The response from business, from academic and from government leaders has been outstanding. So we expect a very productive and a very stimulating meeting.

I will say, as well, that during the meeting we're going to be talking about the importance of trade and the importance of moving forward to approve free trade agreements, and how wrong it is that, because of Congress's unwillingness to put this agreements up to a vote, that we are standing still at a time when exports are driving our economy, and at a time when the rest of the world is moving forward. So we have agreements pending with Colombia, with Panama, and with Korea. And we want to get them done as soon as possible, and we would like to get them done this year, as the President has said repeatedly.

Okay, thank you all. I'll stop there and turn over to you.

QUESTION: Thank you. Sonia Schott, with Radio Valeria, Venezuela. Mr. Secretary, you mentioned moving forward to approve these free trade agreements. There is a kind of hope that there will be a window of opportunity before the elections this year to approve this free trade agreement with Colombia. How confident you are? Thank you.

SECRETARY GUTIERREZ: Well, that is - that is a decision that has to be made by Congress, in terms of what they would leave pending. We would like to see it done this year, but I - I don't - I have no idea if they're planning to be here or if - or if they're just going to come back for a few weeks and then go off again. So - but they'll be here for a few weeks in September. They could do it then. So they'll - if there is a - if there is a desire on the part of the leadership in Congress to get these agreements done, then there should be no excuse.

QUESTION: Jinsook Lee of MBC Korea. My question is related to the previous question. Specifically regarding the U.S.-Korea free trade agreement, President Bush said when he visited Seoul, Korea, just about a week ago, that he sees a window of opportunity to have the Korea-U.S. Free Trade Agreement ratified after the presidential election. And it seems to me that the window of opportunity is extremely narrow after the election, November 4^th. What do you think he meant by saying that he sees a window of opportunity after the - the presidential election in November?

SECRETARY GUTIERREZ: Well, there is a window between the election and the time that the new Congress comes in. It's traditionally been called a lame duck session. And that is an opportunity to bring the Congress back so that they can bring these agreements forward.

Congress would have to decide that they're going to vote on those agreements. But obviously, I agree with what President Bush said; there is an opportunity. And we hope and we have been saying to the Congress that we hope they will take advantage of that opportunity. All three agreements are tremendously important, and I know that the President is - in his trip to Korea, brought it up. And I'm sure there were discussions about this.

We had a meeting a couple of weeks ago where the President joined us to talk about the importance of the Korea Free Trade Agreement. So this is something that's very important not just for the Administration and, obviously, for the President, but for the whole country. So I would call on Congress to take advantage of every opportunity we have before the election and after the election to get these agreements passed, so that we can start accessing these markets and continue to grow our exports.

QUESTION: A follow-up; obviously, those people - officials in both administrations recognize the importance of the free trade agreement, the Korea-U.S. Free Trade Agreement. But obviously, when we talk about the window of opportunity of having the FTA ratified, we have to obviously consider who are in control of the Congress. And Barack Obama and the Democratic leaders have made it very clear that they are opposed to Korea-U.S. agreement in this form, in this condition. So I mean, practically, what is your thought about the possibility of having the Korea-U.S. trade agreement ratified?

SECRETARY GUTIERREZ: Well, I'm not going to get into speculation on presidential politics. But as the President said, there is an opportunity, and we - we request, we hope that Congress seizes that opportunity so that we don't have to continue to wait. We have been waiting for well over 600 days for Colombia. We've been waiting for Panama. We've been waiting for a long time for Korea. We just shouldn't keep on waiting.

And it's wrong for our country; it's wrong for the economic well-being of our country that we continue to wait to get these agreements ratified. There has been a very misinformed analysis about free trade agreements. The reality is, if you take all the free trade agreements that we've done under President Bush and you look at the status, we actually have a $21 billion surplus in those free trade agreements. And the reason for that is that when you have a free trade agreement, you - you're able to sit with a partner and establish the rules, establish how they will be enforced, establish that intellectual property rights are important. So free trade agreements actually help us level the playing field.

Where we don't have a free trade agreement is where we find that we have to do a lot more enforcement. So we need more free trade agreements, not fewer free trade agreements.

QUESTION: Thank you. On the same - now, Mr. Secretary, there seems to be no appetite in Congress to move forward on this issue, especially when we saw what happened with the energy issue, which is a more pressuring issue in the domestic field. They decide to go on the recess without any vote on that matter. And I wonder if you have any pulse on the sense of the American people about the necessity of moving forward on this issue, especially when, ultimately, members of the Congress respond to the Constitution.

And, I mean, there's some - there seems not to be that kind of public pressure on members of the Congress to move forward on this issue.

SECRETARY GUTIERREZ: Well, the interesting thing is that - you know, you mention energy and the opportunity we have to produce more of our own oil in our outer continental shelf and in the Gulf of Mexico. I saw a poll yesterday that mentioned two-thirds of the American people think we should do it. But even when you hear that and even with that pressure, I don't hear that Congress is coming back to vote on it. So it's unfortunate that the American people aren't being listened to when it comes to energy policy.

And I haven't seen any recent polls on trade, but I do believe that there's a lot of misinformation about free trade agreements, and the difference between a free trade agreement and free trade in general. I don't think those distinctions are made.

QUESTION: Okay. I have a kind of follow-up. It is - keeping -- these free trade agreements which are still pending in the Congress, keeping this in mind, this event you mentioned next week is going to take place in Atlanta. It is a way to try to put a little bit pressure to try to pass these free trade agreements? What will be the relation between free trade agreements and the event? What do you expect, at least? Thank you.

SECRETARY GUTIERREZ: Well, free trade is an important part of our relationship, but our relationship with our hemisphere is bigger than just free trade agreements. There are a lot of countries who are coming to the meeting with which we don't have a free trade agreement. We're talking about opportunities in education, opportunities in logistics, and opportunities in tourism, in renewable energies.

The idea of the meeting is that we recognize that we need to be competitive, first and foremost, in our geography, and that it is important, as -- so many other parts of the world that we have opportunities to be more competitive within our hemisphere, and that very often, that jobs that leave our hemisphere don't go from one country to the other, or the jobs that leave one country in our hemisphere don't go to another country in the hemisphere. Very often, they go to another part of the world. And if you recognize that, then you can see the importance of looking for opportunities to be more competitive within the hemisphere. One way is free trade, but there are a lot of other ways as well.

QUESTION: Thank you. Niachian Katz from Phoenix Satellite Television of Hong Kong. Since you discussed the U.S. and Korea, I hope you wouldn't mind answering a question on U.S.-China trade. Next month, you will host of JCCT, U.S.-China Joint Commission on Trade and Commerce. Do you mind giving us a little preview of what do you - what do you hope to achieve in this round of JCCT, your last one? Thank you.

SECRETARY GUTIERREZ: Yes, thank you. We are planning the JCCT for next month. And in general, I'll give you - because we're still working on the agenda, we're still working on the specific items. We would like to follow up on some of the agreements from last JCCT and just make sure that we all know what the status is, and then have new areas of specific agreement to add to that list. The JCCT is important because this is the meeting where we agree to very specific, short-term items, whereas, as you know, the SED is more long-term and more strategic. This is a lot more about now and doing things in the immediate term. So it's a very important meeting, and we look forward to having the agenda and we'll be able to be more specific about that sometime before the meeting.

QUESTION: Diana Moliniari, TV Marti. We have all the lists of Latin American countries with whom - with which we trade. Now concerning Cuba, is there any study made about the potential for future commerce with Cuba in case the situation changes?

SECRETARY GUTIERREZ: There have been several studies made. I don't have any specific numbers in mind. But you know, the telling thing is if you look at the hemisphere and countries that perhaps can serve as an example for Cuba, you know, countries like Chile where per capita consumption, per capita income is now, you know, headed toward $14,000 per capita - Mexico where it's around, you know, 13,000 - those are examples of what can be done when a population's talent is put to work, where people are allowed freedom, where people are allowed to use their innovation, where people are allowed to use their talents combined with a free environment to build economies and build prosperity. So we hope that one day we'll be able to actually see real numbers coming out of Cuba.

It's very unfortunate that what I have heard recently and I've read in open source materials is that they're actually clamping down on people in Cuba who sell products, who have a side business, in order to be able to survive, because we've heard that people cannot survive with the government salary and the government work and, you know, relying on the state. So they have to essentially start these small businesses, whether it be selling rice or fruit or butter or something else.

They are actually - they're actually clamping down. So I just don't know at what point the whole thing is just going to break down, because they can't - how can they continue to ask Cuban people to continue to live with shortages and shortages and shortages and more poverty, when they don't have to? They don't have to. It's just this ideological determination and insisting on an economic theory that doesn't work. And it's not going to work, and at some point they have to realize it; they have to change the system.

QUESTION: Ruben Barrera with NOTIMEX. Mr. Secretary, two quick questions. The first one is again on trade. And I wonder if you can give us your assessment of what the impact could be if the Congress decide ultimately not to approve these trade agreements. Do you fear that this could result in a greater - would have a greater political impact on those countries or an economic impact?

And the other is I wonder, I mean, why you keep pushing for trade agreements when the deficit in the external trade is increasingly going up month after month. So what is the rationale to keep pushing for trade when, you know, you are - seem to - importing more goods than those that you export?

SECRETARY GUTIERREZ: The first question is - and we believe, first of all, that these agreements will get approved, it's just a matter of when. But not approving these agreements would be wrong for our economy because it will give us access to these markets. And if we - if our farmers and our small businesses, our manufacturers don't get access to these countries, then other businesses from other countries will. One example is if Colombia doesn't buy wheat from the U.S., they'll buy wheat from Canada. Because while we have been waiting for Congress to take action on the Colombia Free Trade Agreement, Canada has agreed on an FTA with Colombia, so now they'll be buying, for example, wheat from Canada instead of wheat from the U.S.

The interesting thing - this is something I was saying a little while ago - is that in the free trade agreements that have been done under President Bush, we've done eight. If you add up the surplus or deficit in those free trade agreements among those eight, we have a surplus. We've actually gone from a very, very - almost break-even to a $21 billion surplus. And what that tells me is that free trade agreements enable us to set the rules, to enable us to agree to a set of ground rules, enable us to agree to an intellectual property framework, enable us to agree to investment treaties, and that helps. And it just goes to show why free trade agreements are so important. So what those numbers tell me is that we should be having a lot more free trade agreements, not fewer. And we definitely should not be standing still.

As you look around the world, the European Union is - has, I believe, around 20 free trade agreements, and they are continuing to negotiate. If you take Mexico or Chile, for example, and you include each of the countries in Europe as one country, they have free trade agreements with over 45 countries. And China continues to negotiate free trade agreements. So everyone is trying to open up markets for their businesses. If we stand still, we're going to be at a terrible disadvantage. So we not only need to do these three free trade agreements, but I would hope that we're going to do a lot more in the future.

QUESTION: (Inaudible.)

MR. GUTIERREZ: Well, but the point is that with free trade agreement countries, we have a surplus. So where we have a deficit is where we don't have a free trade agreement.

And the other thing I'll say about the deficit, our strategy in dealing with the deficit has always been to increase our exports, and not to put in place protectionist policies simply to curtail imports. And I can tell you that over the last, you know, several periods, several months, last year, that strategy is working. Our deficit has begun to show a decline.

QUESTION: Thank you. I'm Nestor Ikeda, an Associated Press reporter for Latin America. I want to go back to the Atlanta conference. Mr. Secretary, what kind of document, if any, we can expect from the conference, in order to have some kind of a reference, a guide, for the steps to make in order to convert this Western Hemisphere more competitive?

SECRETARY GUTIERREZ: You know, that's a very good question. We just talked about that recently about the opportunity to actually issue a document from the discussions of what took place, what was discussed, what was shared, what information will be of interest to people. So it's not so much a - an agreement or a treaty or something that, you know, is a binding agreement among countries. It simply is to be able to share the information that we had the opportunity to receive with other people in the hemisphere who would like to see it. So it'll be informal, but very, very useful.

QUESTION: I would like to take this opportunity to ask you about the Korea-U.S. beef deal. Originally, according to the deal protocol, Korea was supposed to open up its market to U.S. beef of all ages. And because of the strong opposition in Korea, now Korea imports only the U.S. beef under 30 months of age. Do you still expect that Korea will open up its market to the U.S. beef of, let's say, older than 30 months of age?

SECRETARY GUTIERREZ: Well, let me just say that we are convinced that our beef is safe, that our standards are second to none, that our beef of all ages is the safest in the world, and that is the beef that we all eat here in the country and that we feed to our children and that we eat at restaurants and that we take home to our families. So that's the first thing I'll say.

I would also recognize that President Lee took a very strong stance and took a leadership stance, and he got a lot of pressure, as we all know. It was a very, very difficult issue. So we understand that it's been very difficult to get this far, and we also recognize how difficult it's been for President Lee and how courageous of a stance he took. But I will say our beef is absolutely safe.

MODERATOR: Okay. If there are no more questions, (inaudible).

SECRETARY GUTIERREZ: Thank you very much.