Embassy of the United States Caracas, Venezuela Public Affairs Office Press Release

March 13, 2002

Democracy, development, governmental integrity, and security are the
four mutually reinforcing pillars upon which the United States bases
its policy to advance political freedom and economic growth throughout
the Americas, according to Assistant Secretary of State for Western
Hemisphere Affairs Otto Reich.

"This administration believes our future and those of our neighbors
are bound together," Reich said, refuting concerns that the U.S.
commitment to hemispheric issues has waned in the days following the
September 11 terrorist attacks against the United States.

In his March 12 speech to the Center for Strategic and International
Studies (CSIS) in Washington, Reich offered an assessment of
developments in the region and how the United States is responding to
the some of the most pressing challenges there. He noted that nations
in the Western Hemisphere are hurting economically because of the U.S.
and global economic slow-down, natural disasters, and a drop in
commodity prices, tourism, and remittances.

Reich said Latin Americans are expressing discontent not so much with
the political and economic reforms upon which the region has embarked
over the past 10 to 15 years, but rather with the quality of their
democratic systems and a perceived inability of free markets to
deliver economic benefits.

Despite these problems, Reich indicated that he was encouraged by
positive trends: for example, the ability of countries that have
stayed the course on economic reform -- such as Chile and El Salvador
-- to weather the current economic downturn better than most. He also
pointed to Uruguay and Costa Rica as "islands of relative political,
social, and economic stability."

Reich said that President Bush's upcoming travel to Mexico, Peru, and
El Salvador in late March, besides being "a concrete manifestation of
the administration's commitment to the region," will allow the
president to discuss with Latin American leaders such regional U.S.
economic initiatives as the Andean Trade Preferences Act and the
U.S.-Central America Free Trade Agreement.

At present, according to Reich, the Western Hemisphere confronts four
high-profile challenges: Colombia, Argentina, Haiti, and Cuba.

With Colombia's democratically elected government facing a threat to
its survival from three separate terrorist organizations, Reich said
the United States is closely reviewing its current policy that focuses
primarily on providing counter-narcotics assistance to Colombia "with
an eye toward other forms of support that we can usefully provide."

Calling Argentina "a close friend and ally," Reich said the United
States stands ready to assist that nation, in coordination with
international financial institutions, in enacting a sound economic
recovery plan.

Haiti, according to Reich, is "in many ways, the most vexing challenge
in the hemisphere" and a country "suffering the cumulative effects of
200 years of bad leadership commanding a predatory state." Breaking
this cycle is Haiti's biggest challenge; U.S. policy is focused on
supporting Organization of American States (OAS) efforts to reach an
accord between the Haitian government and opposition forces that will
resolve the most recent political impasse.

Turning to Cuba, Reich said that the United States has made and will
continue to stand by a "moral, political, and legal commitment" to
promote a rapid, peaceful transition to democracy in that country. To
that end, he added, the United States will assist the island's growing
pro-freedom movement.

"Cuba is not exempt from our fundamental commitment to freedom," Reich
said. "The Cuban people are no different than anyone else in Latin
America -- and indeed the world over. They just want to be free."

Following is the transcript of Reich's remarks at CSIS:

(begin transcript)

Remarks by Otto J. Reich
Assistant Secretary for Western Hemisphere Affairs
U.S. Department of State
Center for Strategic and International Studies
Willard Inter-Continental Hotel
March 12, 2002

As Delivered

"U.S. Foreign Policy in the Western Hemisphere"

It is good to be back at CSIS. As John Hamre said, I go back quite a
ways at CSIS -- actually, 1971. I was getting my Master's at
Georgetown University, and the late Jim Theberge was Director of the
Latin American program at CSIS, which was, at that time, still
associated with Georgetown. There was a contest or request for
proposals, or whatever you want to call it, for two Ph. D. theses and
one Master's thesis. And not being a scholar, frankly, I didn't think
I had much of a chance. But somebody said, "Look, you might as well
apply. Submit a Master's thesis proposal and you get a fellowship if
you are selected."

Well, I was selected. And, frankly, I think that changed my career
considerably, because I did spend a little bit more time studying than
I had been. I had to give up a little tennis in the process. But as a
result of that and many other very fortunate turns in the road, I am
now in this position and I get to speak to a group of people who know
more about this subject than I do. I'm grateful to CSIS for that
important moment in my career and for this invitation today.

I also want to thank a number of people who have already been singled
out, like George Fauriol, who had the position of Director of the
Latin American Studies program at CSIS for a very long time and who
did such a good job. I think the kind of audience here today is an
indication of George's work. I want to thank Mike Zarin who helped me
with these remarks. If you like what I am going to say, you can thank
Mike. If you don't, it's his fault. He helped me put my thoughts
together, frankly, much more coherently and cohesively than I could
have. I do want to leave some time for questions and answers because,
with an audience like this, I think it would be, frankly, not a good
use of my time to just talk to you - or not a good use of your time. I
want to try to engage in a conversation; to the extent we have time.

Let me just tell you briefly how the Bush Administration feels about
this region. From the very first days of this administration,
President Bush and Secretary Powell have given a high priority to
Latin America and the Caribbean, and Canada -- the entire Western
Hemisphere. The President truly believes that our future is
inextricably tied to that of our hemispheric neighbors, having been a
governor of a border state, having a sister-in-law from Mexico. His
brother, Jeb, is the governor of another border state, a sea border,
and has lived for two years in Venezuela and speaks Spanish fluently.

President Bush's first foreign trip was to Mexico. In the first eight
months of his administration, the President met with some half-dozen
hemispheric counter-parts. His second trip was to Canada. He
energetically led the U.S. participation in the April 2001 Summit of
the Americas in Quebec City, where he affirmed his belief that this
will be the Century of the Americas. President Bush hosted President
Fox at this White House's first and only State Dinner so far, because
it happened five days before September 11.

This is a president who feels at home in this hemisphere; who feels
comfortable with its leaders; who is knowledgeable of its people, its
challenges, and its opportunities.

And Secretary [of State] Powell shares that priority. The President
and Secretary have given me the mandate and responsibility to boldly
and creatively pursue this administration's highest priorities in the
region. It is an honor for me to be a part of this grand endeavor, to
serve this president and secretary in the noble pursuit of freedom in
our home hemisphere.

As he has often said himself, Secretary Powell forged an enduring
relationship with many of his foreign-minister colleagues first in
Quebec, and then again most dramatically in that extremely difficult
and uncertain time after the terrorists struck our great country on
September 11.

The Secretary was in Lima that day to sign the OAS Inter-American
Democratic Charter. He often speaks of the incredible outpourings of
grief and sympathy; of the pledges of support and solidarity; of the
concrete steps that have resulted from those pledges, both bilaterally
and collectively via the Rio Treaty or any number of special OAS
commissions.

In the aftermath of September 11, however, we began to hear some
rumblings from various corners, both here at home and in the region,
that the administration's commitment to the hemisphere was little more
than rhetorical. There were those who expressed great uncertainty
about when or even if the administration would turn its attention back
to the region, and if so, how.

Let me assure you that critique of waning interest was wide of the
mark. In the months immediately following that tragic day in
September, this administration from the most senior levels on down
quite rightly focused its attention and energies on the most immediate
task: the safety and security of our people and our homeland. It was
as inevitable as it was appropriate that prosecuting the war on
terrorism would take center stage.

On top of all that, of course, there was the calamity of the President
and Secretary not having their nominee for the Assistant Secretary for
Western Hemisphere Affairs in place. That added another challenge to
boldly and creatively pursuing the President's and Secretary's goals
for the region.

But, early in this new year, as the first phase of the war on
terrorism was well underway and yours truly finally arrived in office,
the administration began looking for ways to reinvigorate our Latin
American agenda; looking for ways to regain the momentum that was
slowed as a result of September 11.

And why? Precisely because this administration believes our future and
those of our neighbors are bound together and that only through
sustained and collaborative engagement can we together strengthen
freedom, create and spread prosperity, and ensure every citizen of the
Americas has a chance to live in peace and security.

It is hard to exaggerate all that we have at stake here. Democratic
political and economic stability in our home region reduces the scale
of illegal migration, drug trafficking, terrorism, and economic
turmoil, and allows us to concentrate greater efforts and resources on
exploiting positive opportunities, both closer to home and farther
afield.

It also promotes expanded trade and investment. We already sell more
to Latin America and the Caribbean than to the European Union. Our
trade within NAFTA is greater than that with the EU and Japan
combined. We sell more to MERCOSUR than to China. Latin America and
the Caribbean is our fastest-growing export market.

But ours is also a troubled region, one that is experiencing an array
of challenges. It is a region that is hurting economically, suffering
the effects of the U.S. and global economic slow-down; a sharp drop in
coffee and other commodity prices; natural disasters; and the
post-September 11 decline in tourism and remittances.

It is a region in which many citizens and some leaders are beginning
to question the wisdom of the political and economic reforms on which
they have embarked during the past 10-15 years.

At a more fundamental level, however, it is a region that is
experiencing the consequences of poor governance and incomplete
reforms.

Latin Americans in growing numbers are expressing discontent not so
much with democracy or the economic model their countries are
pursuing, but rather with the quality of their democracy and the
perceived inability of freer markets to deliver economic growth and
higher standards of living.

Although the region broadly is experiencing multiple challenges, there
are bright spots too. After a decade of reforms, the hemisphere has
become increasingly integrated into the world economy. The need to
trade and attract foreign investment and capital helps dissuade those
tempted to pursue anti-liberal policies.

Those countries -- Chile and EL Salvador, just to name two -- that
have stayed the course on reforms -- maintaining fiscal discipline,
liberalizing trade regimes, privatizing inefficient state industries,
deregulating internal markets, and investing in their own people --
are weathering the economic downturn better than most. For their
parts, Uruguay and Costa Rica are islands of relative political,
social, and economic stability.

Although many challenges to market economics and representative
democracy will persist and could get more difficult as the global
economy continues to sputter, there are no credible alternative models
on the horizon. Our challenge is to work with Latin American leaders
and their citizens to improve the quality of their democracy and the
ability of freer markets to deliver on reforms' promise.

The President's trip to Mexico, Peru, and El Salvador later this month
is a concrete manifestation of the administration's commitment to the
region. It will be a great opportunity for the President to highlight
our multi-layered approach to addressing the region's challenges and
opportunities. More on that in a few moments, but first, let me tell
you a little about the President's trip.

In Monterrey, Mexico, the President will participate in a United
Nations "Financing for Development" conference, hosted by the
government of Mexico. There, the President will emphasize the
imperative of market-oriented and creative strategies to promote and
sustain economic development and prosperity.

In Peru and El Salvador, the President will have trade and
development, democracy and security very much on his mind. In Lima,
the President will have a chance to highlight Peru's democratic
success story and to reaffirm the U.S. commitment to political and
economic freedom in the region.

Although bilateral issues are the main theme, President will also have
an invaluable opportunity to meet collectively with the Presidents of
Peru, Bolivia, Colombia, and Ecuador -- the ATPA countries. Trade will
certainly be on everyone's mind, but so will security,
counterterrorism, counternarcotics and the growing challenges Colombia
and her neighbors face.

In San Salvador, the President will draw attention to El Salvador's
success in fully implementing the peace accords signed 10 years ago;
in creating a market-oriented political system in which competition
not only is tolerated, but encouraged; and in aggressively pursuing
free-market economic policies and reforms that have allowed that
country to weather simultaneous multiple storms of natural disasters,
depressed commodity prices, and a slumping world economy.

As in Lima, bilateral issues will predominate, but regional trade will
also feature prominently. President Bush will meet together with his
counterparts from El Salvador, Costa Rica, Guatemala, Honduras, and
Nicaragua to discuss -- and Panama, I should add -- their shared
commitment to pursue a U.S.-Central America Free Trade Agreement.

This visit to the region provides just the kind of opportunity we need
right now for the President and Secretary to highlight the broad
vision that infuses our policy and philosophy toward Latin America.

Our policy is based on the four pillars of democracy, development,
governmental integrity and security. Freedom underscores and bolsters
these pillars, all of which are inter-related and mutually
reinforcing.

Freedom -- in politics, economics, and trade -- is the thread woven
throughout the fabric of our hemispheric policy. Representative
democracy and free markets are the paths to follow. Governing well,
ending corruption, and fully implementing necessary reforms are the
checkpoints along the way. Education is the essential building-block
for a solid, longer-term foundation. Security is the umbrella under
which everything else becomes possible.

We get to freedom through democracy; to prosperity through trade; and
to security through a concerted, multiple-layered effort to combat the
scourges of terrorism, narcotics trafficking, criminality and
lawlessness, and other trans-national threats.

Responsible government stewardship is essential to achieving each of
these goals. The United States needs to highlight and promote policies
that are crucial to reform's success, such as investing in primary
education, health care, basic sanitation, and productive
infrastructure; reducing corruption; strengthening the rule of law;
and developing modern tax, pension, and regulatory regimes, as well as
labor and property-rights laws. Such reform is essential if publics
are not to turn on their governments and embrace the siren song of
populism during the inevitable periods of economic downturn.

I'd like to turn my attention now to several of the higher-profile
current challenges confronting the hemisphere. I can't deal with all
of them, but let me just mention four: Colombia, Argentina, Haiti, and
Cuba.

In Colombia, the democratically elected government faces a threat to
its survival. Three well-armed, independently financed, extremely
violent terrorist organizations are chipping away at the foundations
of the state. We have a solemn obligation to assist our brothers and
sisters in Colombia in their efforts to protect and defend their
democracy and to create the conditions in which they can effectively
address the myriad challenges that country faces.

Security is a pre-condition that makes possible every subsidiary
objective we share: ending the armed and illicit narcotics production
and trafficking; strengthening the rule of law, respect for human
rights, and the government's ability to exercise its legitimate
authority; reducing corruption, environmental degradation,
lawlessness, and criminality; and further developing the economy.

Heretofore, our policy has primarily focused on a counter-narcotics
mission. That mission remains as important today as ever. But we are
closely reviewing that policy with an eye toward other forms of
support that we can usefully provide to the government of Colombia.

Argentina: A close friend and ally, it is experiencing an economic and
financial crisis. The social upheaval is painful and difficult. And
the risk of political and economic contagion, while diminished in
recent months, is not fully under control. The United States stands
ready to assist Argentina through international financial institutions
in facilitating the implementation of a sound economic recovery plan.

But let me emphasize, as Under Secretary of State Marc Grossman did
last week in Buenos Aires, that our relations with Argentina continue
to be based on shared values and commitments to freedom and democracy.
As we have for several years now, we will continue collaborating with
our Argentine friends on a broad spectrum of issues of mutual concern
that include the situation in Colombia, terrorism and other security
concerns, peacekeeping operations, free trade, democracy, and host of
other issues.

Haiti: In many ways, this is the most vexing challenge in the
hemisphere. It is a country that is suffering the cumulative effects
of 200 years of bad leadership commanding a predatory state. The
current regime in power is only the most recent manifestation of that
200-year history. Breaking this cycle is Haiti's biggest challenge.
Our policy in the short- to medium-run is focused on supporting the
Organization of American States' efforts to help the government and
the opposition reach an accord to break the most recent political
impasse, which is now almost two years old. We are constantly seeking
ways to encourage both sides to negotiate seriously and in good faith.
Reaching an agreement is only part of the answer, though. Ensuring
compliance with any arrangement the parties arrive at will be
essential. It will be a major determinant of success.

Mitigating humanitarian distress is another immediate priority. We
will continue providing generous amounts of humanitarian assistance
through non-governmental organizations. In the longer run, we hope to
help the Haitian people create a democratically competitive political
environment, in which human and civil rights are respected and in
which economic growth becomes possible.

Cuba: You knew I couldn't give a speech on Latin America without
talking about Cuba. In so many ways, Cuba is a special case. It is the
only non-democratic government in hemisphere. It is ruled by a regime
that makes a mockery of freedom; that imposes tyranny on its people;
that imprisons its own citizens for the "crime" of independent
thought.

Cuba is not exempt from our fundamental commitment to freedom. The
Cuban people are no different than anyone else in Latin America -- and
indeed the world over. They just want to be free.

President Bush and Secretary Powell have a positive vision for the
future of Cuba. It includes one in which Cuba's people share in the
opportunities that freedom offers; one in which the people of Cuba can
freely choose their leaders, can freely speak their minds, can freely
practice their faith and obtain an education not twisted by a failed
ideology; one in which the people of Cuba -- like free people
everywhere -- can pursue their hopes and dreams for a better life. It
is a vision of a free Cuba that respects the civil and human rights of
its people, and is a good neighbor to the other countries of our
hemisphere.

We have made -- and will stand by -- a moral, political, and legal
commitment to promote a rapid, peaceful transition to democracy in
Cuba. We will vigorously use the tools available to us, including
assisting the growing pro-freedom movement in Cuba, to lay the
foundations for their future freedom.

There are a lot of other challenges facing the United States in Latin
America. I just want to conclude by saying I am extremely grateful for
the opportunity the President and the Secretary of State have given me
to have this job. The President sent my nomination again for a third
time to the Senate two weeks ago. And as Secretary of State Powell
said yesterday, "We await the action of the Senate." We believe that
our constitution provides the power of each senator to speak his or
her mind on a nomination, and they should be given that right.

In the meantime, I have been sworn in -- a couple of times, now -- and
I intend to continue doing this job as long as the President and the
Secretary want me to do the job. We have great challenges in the
hemisphere, but I have to tell you, I know I'm with a team -- a
foreign-policy team -- the Secretary of State, National Security
Advisor, Vice President Cheney, President Bush, the Defense
Department, other agencies of the government -- headed by people who
have incredible experience. They are calm. They're strong. And, as I
said yesterday in the State Department, if you all sat in on a
meeting, as I have, with the President or the Secretary of State and
foreign Heads of State, or Foreign Ministers, and saw them operate,
you would sleep well at night. I don't sleep well at night because I
get interrupted by the State Department because of one crisis or
another, but I hope that you do.

Thank you very much.

(end transcript)

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