U.S. Commerce Secretary Carlos M. Gutierrez

Remarks by

U.S. Department of Commerce Secretary
Carlos M. Gutierrez

April 28, 2005
The Port of New Orleans

I'm proud to be visiting the home of a real leader to talk about a critical issue for American competitiveness and our economic strength going forward.

Congressman William Jefferson is a man who understands that America's economic destiny is tied to opening markets for American products because they are the best in the world.

Mr. Jefferson represents a commercial center and he is showing the mature economic vision we need to realize our full potential within the global economy. Bill Jefferson is showing the proven, optimistic belief in the power of American workers to compete and win within any fair contest.

He brings great credit to your city and we're proud to be working alongside him to achieve the President's bipartisan, market-opening agenda.

As citizens of a port city and a leading destination for global tourism, you know very well that our national destiny is bound to free trade. New Orleans is an important gateway to the rest of the world.

Your economy is inescapably tied to markets around the world. You prosper when Americans can buy the best things that are made around the world and our trading partners can buy America's best.

The Dominican Republic and Central American Free Trade Agreement builds on that principle.

Out on the river, you will see floating past us some of the 10 million tons of cargo that New Orleans handles every year. Tonnage with the CAFTA countries was up to 450 thousand tons last year.

Last year, 212 thousand tons of imports from the CAFTA countries entered the United States through the port of New Orleans. We sent the CAFTA countries even more: Exports to the CAFTA countries passing through New Orleans added up to 238 thousand tons.

Bear in mind that every ton of that cargo sends economic ripples out across Louisiana. Impact studies tie 1,800 direct jobs to every 1000 thousand tons of cargo currently traded with the CAFTA region. Just imagine how busy this port can become as your economy grows in tandem with economic growth in the CAFTA zone.

Trade opens the door to prosperity for emerging economies. The higher living standards and expanding prosperity CAFTA will foster, will translate into greater opportunities for the people of Louisiana.

The President and Congressman Jefferson understand that the cargo steaming past us creates jobs. Growing trade generates jobs on the ships, on the docks, and in the offices that provide financing, insurance, and other trade services.

There is always a lot of invisible economic activity occurring beneath the surface to make trade happen-even for what would appear to be the simple shipment of commodity goods.

This city has been a strong supporter of international trade and a powerful ally for everyone working to build a brighter future of open markets and shared prosperity.

Preserving opportunity for American small business owners and entrepreneurs requires open markets for U.S. goods and services. CAFTA is a critical step forward. I hope all of you will stand with us. We can build a stronger, and more secure, and more integrated hemisphere by embracing CAFTA.

* * *

The American Dream is the hope of ownership. Under the President's policies, the long-term economic trend is upward. Americans are increasingly achieving success in both business and homeownership. The climate of opportunity is alive.

As our strong economic growth over the past several years makes clear, our prosperity is increasingly tied to opening new markets.

The world has many developed market economies but none of them are growing as fast as the United States.

We are expanding at double the rate of most of our trading partners. Last year, our economy grew at 4.4 percent. Compare that to

2 percent for the EU,
2.7 percent for Japan, and
3 percent for Canada.

We didn't achieve growth like that by shying away from competition or putting up walls-it's not in our nature. There is no other major economy in the world that is as vibrant as the United States. Why do we place such a high value on growth?

There is simply no substitute for growth. Growth gives us options. Growth gives us the opportunity to do more of the things we all want for our society. Growth creates jobs.

Growth raises our productivity and our standard of living. And without strong economic growth, countries lack the resources to build strong civil societies.

This is a vibrant, growing, and prosperous economy. Unemployment is at 5.2 percent. This is lower than the averages we've seen in any of the last three decades.

We have this wonderful combination of high growth, declining unemployment and a low inflation rate. And it's rare to have those three powerful trends come together.

The challenge is to keep that going. We need an environment that encourages innovation and promotes risk taking. We have a rare opportunity to plant the seeds of far stronger growth within some important allies in Central America.

Our highest trade priority is to put the Free Trade Agreement with Central America and the Dominican Republic to work strengthening our hemisphere.

Having spent 30 years in a company that produced products sold in 160 countries, I too know very well the value of free trade. President Bush is asserting strong leadership on the trade front.

Leveling the global playing field for American goods and services is one goal that has a place on top of the President's economic agenda.

America is the world's most dynamic economy largely because we are the country most deeply committed to the principles of free trade.

We have never accepted limits on our commerce.

While there have been setbacks from time to time, Americans have traditionally looked outward to embrace a vision of economic engagement. We grow and thrive on the basis of brands, innovations, and entrepreneurship.

We are a country of explorers and travelers and traders. Americans don't gaze out to sea and fear competition coming ashore. Americans look abroad and dream of new opportunities.

For that reason, free-market forces govern our economy. No country is more open. No country stands to gain more from a global trading system that drops barriers to competition. In a fair contest, America will always come out on top.

CAFTA can transform our region. It's important for economic reasons, strategic reasons, and symbolic reasons.

There's compelling economic logic behind this agreement. Simply put, CAFTA means jobs for American workers.

We already have free trade with Central America. But it's one-way free trade. 80 percent of the imports from Central America already come into the U.S. duty free. CAFTA levels the relationship, giving American domestic companies broader access to this valuable market. It would create the second-largest U.S. export market in Latin America.

The CAFTA market is already a larger export market than India, Russia, and Indonesia combined. We already trade more with Central America and the Dominican Republic than we do with Australia ... and more than we trade with Brazil.

The U.S. Chamber of Commerce predicts that U.S. sales to the region could expand by more than $3 billion in the first year. The American Farm Bureau estimates that U.S. farm exports could grow by $1.5 billion a year.

Just imagine what that would mean for Louisiana. Imagine the increased trade flowing down the Mississippi.

Many manufacturers would gain immediate duty-free access: information technology, farm and construction equipment, paper products, medical and scientific equipment, and pharmaceuticals.

CAFTA strengthens business relationships and competitive sourcing within our hemisphere. Many Central American producers use U.S. parts and materials. It's important to preserve the working relationships between U.S. producers and their customers in Central America.

This integration will make our workers competitive with China and the European Union.

What would it say about the prospects for global free trade if we didn't meet the challenge in our own hemisphere?

The strategic logic of CAFTA is overwhelming. This vote, to adopt CAFTA, is an important step in the advance of economic freedom.

As we all know the Central America of the past was very different. The region was often at war. Many Central Americans lived under dictatorships and military regimes.

Then, some very brave and committed leaders-turned the tide toward freedom, free-market principles, and the rule of law.

Today, as a result, there are peace agreements and democratically elected governments. And there have been sustained periods of economic growth.

I've been doing business in Latin America for [20] years, and I know what happens when democracy fails. I've lived under that failure. I've worked under that failure. We cannot let 20 years of economic and political reform sink into defeat.

The people of Central America see CAFTA as more than a trade agreement. It is the foundation of a lasting partnership. CAFTA can bring stability. It will lock-in regional commitments to the foundations of self-government: Respect for human rights, the rule of law, property rights, and access to capital.

It won't surprise you to know that the people in Central America who oppose CAFTA are the same people who opposed democracy in the 1980s.

CAFTA is the partnership that will help these countries on the road to prosperity. We can accelerate the trend toward economic, political, and social reform.

However, regional progress is not guaranteed. There are still forces opposed to democratic government and economic freedom.

Central America is broadly embracing the principles of self-government and the rule of law that are responsible for stability and prosperity in the United States. Here's the question. How can America do anything less than stand with our brave friends in Central America?

These young democracies are fragile and they need our support.

Strong economies play an important role in the global war on terror. Strong, transparent legal systems and regulatory systems are another key element in this effort.

CAFTA helps us achieve this in much the same way the Security and Prosperity Partnership. Through the SPP, Canada, Mexico and the U.S. are forging a common approach on economic issues and threats to our security.

Economic prosperity and security are mutually reinforcing, and will improve the quality of life for all North Americans.

And CAFTA provides another long-term benefit. With regional economic consolidations taking place in Europe and Asia, CAFTA has the potential to further integrate the western hemisphere so that we can better compete in other markets.

Trade negotiations have already taken an $8.3 billion cost disadvantage off the backs of American workers and American farmers. We'll continue dismantling tariff and non-tariff barriers.

President Bush has shown that we will confront trading partners who fail to live up to the terms of our trading agreements. We will lay down the law if trading partners game the system.

An innovation-driven economy like the United States must be especially wary and active to counter the threat posed by the theft of intellectual property. We need to stop the theft of intellectual property rights.

As all of you know, many of the challenges posed by the global economy are difficult. The President has a bold, free trade agenda. Accomplishing these goals won't be easy.

But, as I learned during my first cabinet meeting, President Bush isn't serving to play as he calls it: "small ball." He's here to confront the big challenges on the horizon.

This country has been through a lot over the last four years and we're poised to do amazing things in the years ahead thanks to people like all of you.

CAFTA is vitally important to our future economic strength.

CAFTA will be good for Louisiana. It will be good for Central America. And it will be great news for American workers in the 21st Century economy.

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