Where Industry and Security Intersect
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Mr. Vice President, Mr. Minister, Distinguished Guests, Ladies, and Gentlemen. Thank you very much for that warm welcome. It is wonderful to be back in Panama. I am greatly honored to have received the Vasco Núñez de Balboa Medal earlier today and deeply humbled to be in the company of those who have received this recognition previously.
It is also a great honor and pleasure to be speaking at the Annual Meeting of the Panama Chapter of the U.S.-Panama Business Council (USPA). Ten years ago, while I was in the private sector practicing law, and between stints in the government, I had the good fortune of being asked by Ambassador Sosa to be a founding Board member of the Council. Those who founded USPA had a strong background and involvement in U.S.-Panama issues. Equally important, each one of us had a great love for this beautiful country, married to a vision of a vibrant U.S.-Panamanian relationship. Over the years, USPA has played a key role in advancing the bilateral economic agenda. I am proud to have been affiliated with this organization.
The history of our two nations has, of course, been intertwined for over a century. While I have not been involved in U.S.-Panamanian relations for that long, I have been fortunate that Panama has been a part of my life and work for almost three decades. During that time, I have seen Americans and Panamanians working together successfully to build a more just and a more prosperous Panama. While, not surprisingly, the relationship between the United States and Panama has, from time to time, had its ups and downs, this is only to be expected when two countries are so close and so familiar. Throughout our history, however, there have always been strong, underlying bonds between our people to steer through the shoals to a deeper friendship.
This very personal tie is embodied in the nearly 26,000 Americans who are residents in Panama, along with the thousands more who were born in this country and have returned to the United States. It is also expressed every day in the lives of the well over 100,000 Panamanians who call the United States home. Our people-to-people contacts even extend to our athletes. The United States and, in particular, my favorite team, the New York Yankees, have long benefited from a steady stream of outstanding Panamanian athletes, stretching from Hector Lopez to Mariano Rivera.
I was reminded of our deep connections when I was here last year during your 100th anniversary of independence. I was proud to be representing my country at that celebration. And I am equally proud to say today that the current state of relations between our two countries is excellent. We are not only good friends, we are partners in addressing common challenges of the 21st century. We are, for example, working together to combat international terrorism, where Panama has been a leader in efforts to stem terrorist financing. We are also working together in the struggle against drug traffickers. Panama’s law enforcement efforts in this regard have been exemplary. And we are partners in seeking to achieve a Free Trade Area of the Americas, as we both recognize the enormous benefits that come from open markets and free trade.
It is altogether fitting and proper that we should be partners in trade, as our two countries have, in fact, had a long and fruitful commercial relationship. It is a relationship that is reaffirmed every time an American or Panamanian reaches into his or her wallet for a dollar bill, a currency that we share. That is why, even as we work together toward a Free Trade Area of the Americas, it is also natural and important for us to work together to strengthen our ties with a comprehensive, fair, and balanced bilateral free trade agreement.
As President Bush has often explained, free trade is the engine of prosperity. In the words of the Administration’s National Security Strategy, “Economic growth supported by free trade and free markets creates new jobs and higher incomes. It allows people to lift their lives out of poverty, [and] spurs [the process of] economic and legal reform . . . .”
The joint commitment of the United States and Panama to free trade goes back many years. We signed a framework agreement in 1991, and have met regularly since then to discuss trade and investment issues. We energetically supported Panama’s accession to the World Trade Organization in 1996, and have always involved Panama as a key partner in our efforts to deepen economic integration throughout the Western Hemisphere. Indeed, we greatly appreciated Panama’s leadership in serving as host of the FTAA negotiations from March 2001 to February 2003.
So the bilateral free trade agreement that we are now discussing — and for which we have held three productive rounds of negotiations — is really the culmination of a long and collaborative dialogue between our two countries that has spanned several administrations, both in Panama and in the United States. I congratulate Panama on the way that successive administrations have seamlessly handled trade and investment issues, whether it be the WTO negotiations that the Endara and Perez Balladares governments tackled, or the way that the current and incoming governments are managing the transition with regard to our free trade negotiations. It is an impressive model of teamwork, which demonstrates a longstanding, deeply ingrained recognition of the benefits of free and open trade.
That is why I am optimistic that we will be successful in concluding an agreement that advances the commercial interests of both parties and promotes the welfare of the people of our two countries. A free trade agreement will establish clear rules of the road for commercial transactions and increase market access and investor confidence, thereby generating jobs and spurring economic growth. So I say, not just as a senior U.S. Government official, but as a good friend of Panama, let’s not miss this opportunity! I am hopeful — indeed confident — that the incoming government of President-elect Torrijos will continue our bilateral dialogue in this and other areas to build upon the accomplishments of the current administration.
We have also learned in recent years that trade and economic development cannot stand on their own. They must be built on a firm foundation of security. We did not really need the terrorists of September 11 to teach us this fact, but the atrocities of that terrible day provided a stark reminder of this simple truth.
I have often heard trade and security discussed in mutually exclusive terms — more of one means less of the other. But anyone who remembers the long lines of trucks along our borders with Mexico or Canada following the 9/11 attacks, or the disruption in air and sea traffic immediately after that terrible day, understands how badly mistaken that point of view is. Trade and security are not in competition. Trade and security are two sides of the same coin. Or, let me put it another way. Without security there is no trade. It’s as simple as that.
In a globalized world, people, goods, and ideas flow across borders in unprecedented volumes and with unprecedented ease. While most of this movement directly benefits our economies and our lives, some small but significant portion is aimed at damaging us and our institutions. Whether it be terrorists, money launderers, or those who trade in illegal arms and drugs, they all pose a greater and more imminent threat to our security than many had realized before 9/11. As international commerce grows and diversifies, therefore, we must increase our focus on security in order to preserve the benefits of free trade. Today we must pay attention to the security of our ports and our canals, to the integrity of our intermodal containers, and to the identity of end-users of our goods and technologies.
Here in the Western Hemisphere, trade security requires Panama’s leadership. With its central location and busy Canal, Panama is a bridge between the two halves of the Americas and a link between the nations of our Hemisphere and our trading partners on other continents. A secure Canal is an economic lifeline for all of us.
Indeed, Panama’s own prosperity directly depends on its status as a secure transshipment hub. Panama’s Canal and ports provide the backbone of its economy and constitute a powerful engine for growth, jobs, and prosperity for the Panamanian people. Given the stakes involved, it should be no surprise that the Government of Panama has stepped up to its responsibilities and become a valued partner on a wide range of security matters. As I have noted, Panama is a strong ally in the fight against terrorism, money laundering, and narcotics trafficking. I am confident that our cooperation on these issues will continue as President-elect Torrijos and his team assume the reins of government. Our joint accomplishments during the past five years are clear evidence of the advantages that accrue to both Panama and the United States when we work together to make our nations and our Hemisphere safer and more secure.
We applaud the constructive role that Panama has played in the International Maritime Organization, and commend President Moscoso’s government for the impressive strides that Panama has taken to comply with the International Ship and Port Facility Security Code. Panama also is a valued partner in several joint efforts to bolster the security of trade. For example, Panama has strongly supported our Proliferation Security Initiative, as demonstrated by our agreement to allow for the boarding in international waters of U.S. and Panamanian-flagged vessels that are suspected of carrying weapons of mass destruction, their delivery systems, and related materials. In addition, we have discussed our Container Security Initiative with the Government of Panama, and we very much appreciate Panama’s interest in this program. And, in the context of our free trade talks, we are working with Panama to assist in the development of a world class export control system that will deny Panama’s air, sea, land, and Canal to terrorists as a transshipment hub for lethal goods and technologies. This latter effort has been a key component of the U.S. Commerce Department’s Transshipment Country Export Control Initiative — also known as TECI.
All of these programs will strengthen Panama’s ability to ensure that its ports and its vessels are not used to divert lethal materials to criminal or terrorist end-users. This cooperation will help us —and all the peoples of the Western Hemisphere — to build our trade and prosperity on a solid foundation of security.
Our challenge, of course, is to enhance trade security without sacrificing our values, our way of life, or our economic well being. Security comes at a price, and we must be willing to incur some ongoing marginal costs in order to avoid one-time catastrophic costs. But we also must be efficient in our security measures, using our intelligence and our technological resources to target our efforts. Done properly, sound security facilitates legitimate trade. Indeed, I would argue that security not only is compatible with vigorous and growing trade, but that transshipment hubs such as Panama will come to view trade security as a positive strategic measure of their overall economic prosperity.
It has been my privilege to have played some small part in these issues and, more broadly, in U.S.-Panama relations. I am deeply gratified to have been affiliated with the U.S.-Panama Business Council and the outstanding work that all of you have undertaken as part of our bilateral relationship. Please be assured that I fully intend to continue to contribute to our common cause in any way possible.
Thank you very much.