The Western Hemisphere: 2007 in Review and Looking Ahead to 2008

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9:30 A.M. EST

MODERATOR: Good morning. Welcome to the Washington Foreign Press Center. Thanks for waiting for us so patiently today. And without further ado, I'd like to introduce Assistant Secretary of State for Western Hemisphere Affairs Tom Shannon.

ASSISTANT SECRETARY SHANNON: Thank you very much. Thank you all for taking the time to meet with me today. I'll make a few brief opening comments and then look forward to your questions. Again, I appreciate the opportunity to speak with you all. What I wanted to do is just talk a bit about what we see as our accomplishments and our America's policy in the year 2007 and then with a view to the future, talk a bit about our priorities and goals as we look deeper into 2008 and then of course, take your questions.

We have distributed to all of you an accomplishments, a sheet called "2008 Historic Commitment, Positive Engagement." The - as you will see when you work through this and this is also available on our website for anyone who is with us through DVC and does not have the document in front of them. But effectively, it's an effort to encapsulate what we think are most of our major accomplishments. It's not an all-inclusive document. We've been very, very active in 2007. There's a lot that we've done in terms of the visits, in terms of initiatives and in terms of our diplomatic and political outreach. But it was an effort to pull together some of the most significant accomplishments and arrange them in a way that makes sense in terms of the President's larger social justice agenda in the region. And you'll note that they're captured in four headings which relate to the principle themes or pillars of our America's policy, which are consolidating democracy and promoting prosperity, investing in people and protecting the security of a democratic state. And as you look through them, you'll see that so many of them are concentrated in the promoting prosperity and investing in people category. But there are some very, very important initiatives in the protecting the democratic state category also.

And again, as I mentioned, these link to the President's larger Social Justice Agenda, an agenda that he outlined in his March 5^th speech before the Hispanic Chamber of Commerce just before his trip to the region. And again, the purpose of this effort is not only to create economic opportunity, but to work with countries in the region and invest in people, invest in national infrastructure so that people have access to this opportunity, that they have an ability to begin to tap into the wealth that's being created in the Americas and participate as citizens in their countries, not just politically and not just in terms of voting, but also economically and socially. And ultimately this is how we use our economic policy, how we use our trade policy, how we use our commercial engagement to address the larger question of poverty and larger question of inequality and especially the issue of social exclusion. Because as we look at our - the different facets of our economic policy in the region, this is really about building nations through economies and using the creation of sustainable job growth, especially in the formal economy to make people meaningful members of the states and the communities in which they live.

And very briefly, as you look through these, we begin with our free trade agreements. And as you know, this is an administration that has concluded ten free trade agreements since taking office and effectively has built a string of free trade agreements that stretch along the Pacific coast of the Americas from Canada to Chile. It encompasses two-thirds of the GDP of the Americas, excluding the United States -- it's more, if you include the United States -- two-thirds of the GDP of the Hemisphere, one-third of our global trading capacity and which creates an important strategic platform in the region, not just to share ideas about free markets and democracy, but also an important platform to face across the Pacific to some of the most dynamic economies of the world, but also a platform that allows us to engage in a more coherent discussion with the rest of the region about trade.

The Millennium Challenge Corporation which is again a longstanding initiative of this Administration, for which we have begun disbursing the nearly $1 billion we have committed to this hemisphere in countries in Central America, such as Nicaragua, Honduras and El Salvador, but also those countries with which we have threshold programs, such as Guyana, Peru and Paraguay. Also looking at debt relief, something that the President highlighted in his speech of March 5^th, the President's G-8 Initiative, which was taken into the IMF and the World Bank, was extended to the Inter-American Development Bank and more than $3.4 billion in debt relief was granted to the poorest countries of the region.

Our biofuels partnership with Brazil, which we consider to be an important step forward in our effort to democratize energy and provide for the countries and the peoples of the America alternatives that are environmentally friendly, but which also create energy sectors and energy - national energy capacity in countries, especially in Central America and the Caribbean, that do not have access to petroleum and gas resources, but do have viable economic agricultural sectors from which energy sectors can be built.

And of course, the promoting small business initiative and the Latin American and Caribbean infrastructure development programs also come out of the President's trip to the region. This is all about again building the - creating capacity in countries to create jobs and create jobs that are sustainable through promotion of small and medium size enterprises. And again, working with countries to build national infrastructures and help them gain access to international capital markets for infrastructure projects. And in terms of investing in people, initiatives such as the deployment of the U.S. Naval vessel, the Comfort, to the region which treated nearly 100,000 patients, the healthcare training center established by our Secretary of Health and Human Services, Michael Leavitt in Panama and built off of memorandums of understandings with all of the Central American countries, was a big step forward in improving healthcare, especially in rural areas, as we reach out to rural healthcare promoters and provide them access to up-to-date training, our partnership for Latin American youth and the extension of scholarships with $75 million to many thousands of students around the region. And also a broader commitment to the people of Cuba through increased democracy spending, work for partnership for breast cancer awareness and research in the Americas, a program which we have launched in South America and we will soon be launching elsewhere in the region.

And then of course, the U.S.-Chile Equal Opportunities Scholarship Program which from our point of view is an innovative program in the sense that it builds off a willingness and a vision in Chile to bring Chilean scholars to the United States to study science, engineering and technology fields. But going beyond the usual self-selecting nature of many of these scholarships, reaching into those parts of Chilean society that normally would not have access to such scholarships, because they don't speak English, we're providing English language training for these students. And the first batch of students have already been identified and will be on their way to the United States soon.

And then, broadly as we look at protecting the democratic state, one of the most important initiatives done in 2007 was the announcement of the Merida Initiative which, as you know, is part of a larger $1.4 billion, three-year effort to help the countries of Mexico and Central America to build their capacity to fight organized crime and drug trafficking. The President in the 2008 supplemental request asked for $550 million, an additional request we made in our 2009 budget and then of course, looking ahead to the third year of the Merida Initiative in the 2010 budget.

We also announced a strategy to combat gangs. We began a U.S. dialogue - a security dialogue with Central American countries. The first of its kind which we believe has played an important role in building a regional understanding about security issues and creating a series of priorities and a security agenda for Central America that is unique and that will allow us to engage with the Central Americans I think in a coherent and comprehensive fashion. We're also continuing our progress in Colombia. We look forward to continuing engagement in Colombia. And then of course, continuing our development in the Security and prosperity partnership with North America and Mexico and, in particular, the announcement of a North American plan to fight pandemics in Avian influenza.

From our point of view, 2007 really did represent a year of engagement, as we have called it, not only at the presidential level, but at the cabinet level. I think just about every cabinet Secretary, with maybe the exception of the Veterans Administration, has been in the region in one form or another. Several cabinet secretaries, such as Secretary Paulson, Secretary Gutierrez, and Secretary Rice have been in the region numerous times. This highlights kind of the level of dialogue, the level of cooperation that is continuing.

And as we look to 2008, we really hope to make this a year of partnership. We hope this to be a year in which we consolidate what we achieved through our engagement in 2007, but also to highlight the sustainability of our policy, to highlight the bipartisan nature of it and to show that the United States understands that in order to maintain influence in the region, it has to be present and that we have to be present in a way which is helpful to the governments of the region.

Now, we need to understand their problems, understand the issues that they're facing, the challenges that they're facing and be prepared to adjust our assistance programs, our engagement in international financial institutions and our political and diplomatic engagement to help these countries be successful. Because ultimately, the larger social justice agenda of the Bush Administration is really about cementing this linkage between democracy and development and showing that democracy can indeed deliver the goods, but also that development can be democratic. This is a unique challenge. No other part of the world has taken on this kind of challenge, but the Americas have. And it's a hugely important time for the United States, although much is happening around the world and these issues sometimes drowned out what has been happening in the Americas. The fact of the matter is we are engaged in the Americas, we are committed to the Americas and we believe that in the coming year, we're going to be able to show that this is a commitment that is enduring. So thank you very much.

QUESTION: You said that you are engaged in the region and I was wondering if you could walk us through what the outlook is for two of President Bush's initiatives or priorities for this year. One, the likelihood that Congress will pass the Merida Initiative this year and what are you doing to lobby Congress to get the Colombian FTA approved this year as well?

ASSISTANT SECRETARY SHANNON: Right. Thank you for the question because obviously these are two issues that are going to be very important and that will attest our ability, number one, to show that the United States can stay engaged in the region in a way that's directly responsive to the needs of the countries in the region, but also that we can work in a broadly bipartisan fashion and that we can construct a policy that is sustainable.

In regard to the Merida Initiative, as I noted, the President did make a $550 million request in the fiscal year '08 supplemental. We will be presenting to the Congress an additional request in our fiscal year 2009 budget, which goes to the Congress in February. And obviously, this has been kind of envisioned as a three-year package. We will eventually, depending on what we get from our Congress in the supplemental request and what we ultimately get in the '09 request -- be look at how we shape a request for fiscal year 2010. Our engagement with the Hill so far I think has been productive. I think it's been positive. There have been a variety of trips to Mexico and Central America, both by congressional staff members and by members of Congress. I think there's a broad understanding of the importance of the Merida Initiative, a broad understanding of what it means or signals in terms of our larger relationship with the region, but we still have work to do. As we go through the different items and determine, you know, what aspects of our initiative the Congress can fund and what aspects its wants to take a second look at. In regard to the FTAs, again, our point of view is that having secured congressional passage of Peru, we're now looking for quick action on Colombia and ultimately Panama. Our commitment to Colombia is complete. You've seen a variety of high-level CODELS, congressional delegations traveling to Colombia, many of them led by members of the cabinet. That will continue. It's my hope that the Department of State later today will be able to announce a trip in the near term which regrettably I cannot talk about in any detail right now. But this will underscore our commitment and our belief that the Colombia Free Trade Agreement is not only central to our relationship with Colombia, but also central to our broader economic and trading relationship with the Americas.

QUESTION: Thank you. Sonia Schott with Radio Valera, Venezuela. Mr. Shannon, under the light of the current political events between Venezuela and Colombia and considering there were some comments coming from Bogota from Mr. Walters regarding security concerns on Venezuela, do you have anything to comment on that? There is any level of communication between the U.S. and Venezuela. Thank you.

ASSISTANT SECRETARY SHANNON: I'm sorry. What would you like me to comment on?

QUESTION: Regarding Venezuela, the current political situation between Venezuela and Colombia, what's going on? What is your perception on what's going to be with Venezuela and the relationship with the U.S?

ASSISTANT SECRETARY SHANNON: Okay. Now obviously, as I've noted before, our relationship with Venezuela has passed through a difficult period. However, we've always signaled an openness to improve that relationship and especially an openness to focus on specific areas where we think the relationship can improve and can yield positive results for both countries.

I think one area which is very important is counternarcotics. It's evident over time that the fight against counternarcotics is a transnational fight. It cannot be won country by country. It has to be addressed in a regional fashion. That's one of the reasons we have developed the Merida Initiative in an effort to kind of link Mexico, Colombia and Central America in kind of a single strategic approach to a problem.

Regrettably, we don't have that strategic approach with Venezuela, but we would like to have it. And there are possibilities, you know, for improvements in that regard and we would be very open to exploring those. Recognizing at the end of the day that the United States is a market for these drugs and that just as there are shared challenges in the region there are shared responsibilities and the United States has to step up to those aspects of its shared responsibility. It's something that we've acknowledged in our relationship with Colombia, something that we've acknowledged in our broader relationship with the Merida Initiative.

QUESTION: Ruben Barrera, Notimex, Mexico. Going back to the Merida Initiative, two questions. First of all, could you clarify what you say that the State Department is going to request additional funds this year for that initiative? I wonder if that is going to be - that request is going to be separated, the 500 -- $50 million that President Bush request and did you have a figure on this original request?

The second question is yesterday there was some officials from - well, former officials from the border patrol who say that there is a high chance that the current level of violence across - through the borders in Mexico could have spillovers in the U.S. I wonder if you share that concern or do you have any information that suggests that that may be possible and if the U.S. is doing something to address those concerns.

ASSISTANT SECRETARY SHANNON: Okay. First let me start by congratulating the Government of Mexico for the arrest of Alfedo Beltran Leyva of the Sinaloa cartel yesterday. This is a very important arrest. Beltran Leyva is one of the most important members of the Sinaloa cartel and certainly one of the most brutal and violent. And this is - this arrest is indicative of a very aggressive approach to counternarcotics that the Calderon's administration has taken, one that we find very important and very hopeful.

In regard to the Merida Initiative and budget request, the $550 million was requested in a supplemental request for fiscal year 2008. We are in the process of producing our fiscal year 2009 budget, which I believe will be presented to our Congress in February. I cannot talk about the numbers that will be in that budget request until it goes to our Congress. But since we have seen, or since we have understood the Merida Initiative as being a three-year program, we're looking at the three tranches being fiscal 2008 supplemental request, the regular fiscal year 2009 budget and we believe the regular year 2010 - fiscal year 2010 budget request. I'm sorry, that's another --

QUESTION: The other question was yesterday --

QUESTION: Violence going ---

ASSISTANT SECRETARY SHANNON: Oh, yeah, I'm sorry. We were very saddened to learn of the death of a border patrol officer who was run over by a vehicle coming out of Mexico either transporting illegal aliens or transporting drugs of one sort of another. Our border patrol is very courageous and an important part of protecting our borders and this kind of violence against uniformed officials cannot be tolerated. And the Government of Mexico has made very clear that they agree with that point of view. They are working with our law enforcement officials to try to identify those involved in the killing and it's our hope that we're going to be able to bring the people who killed the border patrol officer to justice soon.

Speaking more broadly about the border, it's important to understand that as I noted in regard to Colombia and elsewhere, this is a transnational problem. It's not a problem that ends at our border. It is certainly a problem that crosses it not only in terms of the products, drugs going to the United States or weapons and bulk cash going from the United States to Mexico, but also in terms of criminal organizations and structures. Several weeks ago the Mexican authorities after a gun battle with gang members in Mexico arrested several individuals who were U.S. citizens and were tied to these gangs. I think that's evident of linkages across the border. So we just have to assume that this is not just a Mexican fight, that this is a fight that involves Mexico and the United States.

QUESTION: Thank you. Vanessa de la Torre from Caracol, Colombia. Mr. Shannon, you just say that U.S. - the United States is open to improve the relationship with Venezuela, even though when Venezuela is a country that supports terrorist group and the FARC. I mean, President Chavez just said two weeks or one week ago that he supports the FARC. So is the United States Government open to improve that relationship with a country that supports openly terrorist group?

And also, I would like to know if there is any information confirmed by the U.S. Government about planes leaving from Venezuela with cocaine made in Colombia flying to U.S. and to Europe.

ASSISTANT SECRETARY SHANNON: You know, in regard to the latter part of the question, Juan Forero did a piece in the Washington Post several months ago kind of highlighting the movement of drugs out of the Andes and into the Caribbean and also West Africa and Europe. And it's evident that for a variety of reasons Venezuela is being used as kind of a trampoline to move drugs, especially by air, out of Colombia and into the Caribbean or into West Africa. There's a variety of reasons for it. One of it has to do with the air interdiction programs that exist in Colombia and in Brazil and make long-distance flights by small aircraft very difficult, so the tendency is to move drugs by river or by short flight into some parts of Venezuela and then move those drugs by aircraft either into the Caribbean, into Haiti, into the Dominican Republic, or into Western Africa, where they're then taken up into the Canary Islands and into Spain and then into a European market.

This is an issue that we've been tracking for some time. It's an issue that we've had discussions with all of our partners in the region about. So without a doubt it's happening, and this is one of the reasons why we believe that if we were able to enhance our counterdrug cooperation with Venezuela we might be in a position to affect the movement of this kind of illegal activity.

More broadly speaking, I mean, our views on the FARC are well known, as is our views on all foreign terrorist organizations. We believe that President Uribe's approach on democratic security has been the right approach. We believe that the effort made by countries in the region and elsewhere such as the European Union to classify the FARC as a foreign terrorist organization are correct.

But that said, as we look more broadly in the region, historically the western part of Venezuela and the eastern part of Colombia have been difficult areas to manage, difficult areas to control. There's been lots of contraband back and forth across that frontier, not only in terms of precursor chemicals but also drugs, weapons and munitions. And the only way that any control is going to be had over those borders is if Venezuela and Colombia cooperate. And this is what we hope for and this is what we'd like to work towards.

QUESTION: Thank you, Mr. Shannon. Mr. Ikeda from the Associated Press, the Latin American Division. The Colombian press has been reports - reporting widely in the past week about the next trip of the Secretary of State to Medellin. And would you please confirm the report and what is the reason of that trip?

ASSISTANT SECRETARY SHANNON: It's my understanding that later today the State Department Press Office will be releasing information about trips to the region, so unfortunately I can neither confirm nor deny at this moment what you just noted, except just to stay tuned.

QUESTION: Adriana Garcia, Reuters Latin America. Mr. Shannon, I'd like (inaudible) the U.S. has any evidence that Venezuela is transferring or selling arms to the leftist guerillas in Colombia, the FARC and the ML. And I would like also if you could comment on where the relationship with Argentina stands after the recent episodes they had with Venezuela and the money that (inaudible).

ASSISTANT SECRETARY SHANNON: In regard to Venezuela and Colombia, I think all parties to this issue would acknowledge that weapons and munitions do flow across that border. However, at this point in time, we have nothing to indicate that this is the result of a policy by the Venezuelan Government. It seems to be contraband that moves either with the knowledge of officials in the region who have been corrupted and who are benefitting from this or in some instances done by weapons trafficking organizations.

As I mentioned, this is a porous border and it's a fairly wild area. Things move back across - back and forth across that border quite easily. And the way this kind of phenomena has to be addressed, whether it's precursor chemicals, whether it's cocaine and other narcotics or whether it's weapons and munitions, is through cooperation along the frontier.

And in regard to Argentina, our relationship with Argentina is an important one for us. Historically, it's been a very strong relationship. I believe it still is a strong relationship. And it's our intent to make sure that we stay focused on the fundamental interests that join us as nations and as members of a democratic and free America, and do everything we can to strengthen that relationship.

QUESTION: Antonio Rodriguez with AFP. Just I'd like to have a reaction after the election in Cuba this weekend and I would like to have an update about international fund launched by President Bush a couple of months ago. I would like to know if some countries decided to join this fund for democracy in Cuba. Thank you.

ASSISTANT SECRETARY SHANNON: Yeah, in regard to the selection process in Cuba there, we don't have much comment. I mean, this is - it really isn't an election, so I wouldn't call it as such.

And in regard to the Freedom Fund announced by President Bush, we and the Department of Treasury and other members of the U.S. Government are in the process of working internally to design this fund and determine what its characteristics would be. And once we have done that, we will begin out reach to countries that we think would be interested in participating in such a fund.

MODERATOR: Unfortunately, that's all the time we've got today. Thank you, Assistant Secretary Shannon.

ASSISTANT SECRETARY SHANNON: Thank you all very much.