Fwd: En;WF,US Trade Rep's bizarre version of successes of NAFTA,Jul 26
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>Subject: En;WF,US Trade Rep's bizarre version of successes of NAFTA,Jul 26
>Date: Tue, 31 Jul 2001 08:20:57 -0500 (CDT)
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>From: "Dana Aldea" <thrassa15@...>
>Subject: WF,US-Trade Rep's bizarre NAFTA eulogy,Jul 26
>Date: Sun, 29 Jul 2001 13:33:12 +0000
>Reading this text made me feel actually physically sick
>* * *
>26 July 2001
>Text: U.S. Trade Rep. Says NAFTA Rewards Mexico, United States
>(Zoellick says pact fueled economic growth in both nations) (4040)
>The North American Free Trade Agreement (NAFTA) has fueled economic growth
>in both the United States and Mexico, says U.S. Trade Representative Robert
>Appearing July 26 before the National Foreign Trade Council, Zoellick said
>NAFTA has contributed to job creation and economic reforms in Mexico,
>supported the country's "resilience amidst the challenges of
>and laid the groundwork for stronger environmental safeguards.
>As for the United States, Zoellick said U.S. exports to NAFTA partners
>Mexico and Canada now support 2.9 million U.S. jobs: 900,000 more than when
>the trade pact was approved by the U.S. Congress in 1993. Such jobs pay
>wages that are 13 to 18 percent higher than the average U.S. wage, Zoellick
>said. In addition, he said, NAFTA has helped reduce prices on everyday
>consumer goods, increased consumer choice, and stimulated economic growth.
>NAFTA, said Zoellick, has helped boost the competitiveness of the entire
>U.S. economy -- "a benefit that's felt throughout the United States," he
>Zoellick said developing nations "frequently fail to invest their capital
>productivity." But NAFTA, he argued, has helped solve this problem for
>Mexico "by creating a more stable and predictable environment for
>and leading foreign capital toward more productive and efficient uses."
>As for the merits of enacting new trade agreements, such as the proposed
>Free Trade Area of the Americas, Zoellick said that "there is something
>tragic about seeing the leaders of almost every poor, developing country
>imploring the United States to expand free trade with their countries,
>a movement of largely middle- and upper-class protesters in developed
>nations try to close the door of opportunity." Quoting former Mexican
>President Ernesto Zedillo, Zoellick said the protesters "seem strangely
>determined to save the developing world from development."
>Nevertheless, "all of us want to see trade support protection of the
>environment and core labor standards," Zoellick concluded. "But in the end,
>the numberless and voiceless poor will only have a chance to raise their
>living standards and offer a better life for their children if global trade
>and investment flows continue to expand."
>Following is the text of Zoellick's prepared remarks:
>[Note: In the text, "billion" equals "thousand million."]
>As Prepared for Delivery
>Robert B. Zoellick
>U.S. Trade Representative
>National Foreign Trade Council
>July 26, 2001
>I appreciate being given this opportunity to speak to the National Foreign
>Trade Council. I want first to thank NFTC and its members for your support
>as President Bush seeks to regain momentum for America's trade agenda. We
>have an extraordinary opportunity to shape the design of the world trading
>network -- and to ensure that the United States is the nucleus of this
>dynamic system. Yet we cannot do so without the strong, sustained support
>America's private sector.
>We are in the midst of a great debate about trade. We can no longer presume
>a domestic consensus on the benefits of openness and expansion. Therefore,
>it should not be a surprise that the opponents of openness have targeted
>North American Free Trade Agreement, NAFTA, which seven years ago created
>the largest free trade area in the world. What is a surprise is that the
>proponents of an internationally engaged United States have so often
>abandoned the debate to the economic isolationists and false purveyors of
>fright and retreat.
>If we are going to extend free trade to all the Americas, if we are going
>launch a new global round of trade negotiations that will lift the fortunes
>of the developing and developed world alike, if we are going to negotiate
>free trade agreements with reforming, opening economies so as to set models
>and raise hopes for others -- and if we are going to persuade the U.S.
>Congress to support the President on trade -- then we -- all of you -- must
>tell the truth to the American people about the benefits of trade and
>openness. And in telling the truth, we must dispel the myths about NAFTA.
>NAFTA offers the high ground on which to plant the standards of free trade,
>democracy, and support for developing nations.
>First, NAFTA was one of the United States' first post-Cold War political
>economic commitments. As such, it offers a model for U.S. engagement with
>many countries -- for neighbors near and friends afar. So let's put the
>question directly: Has NAFTA promoted U.S. interests? Has NAFTA been good
>for U.S. families, workers, farmers, ranchers, and businesses?
>Second, NAFTA offers a concrete example of free trade between developed and
>developing nations. Indeed, this is a test case with a 2,000-mile border.
>For all the ink spilled speculating about "globalization," NAFTA offers a
>"ground zero" case of policy in action. So how has NAFTA affected the
>overall relationship between the United States, Canada, and Mexico? Does
>NAFTA offer a new model for North-South relations, one of the great foreign
>and economic policy challenges now that the Cold War division between East
>and West is over?
>Third, NAFTA has been the cornerstone of Mexico's development strategy,
>politically and economically. What has NAFTA accomplished for the people of
>Mexico? What do the Mexican people think of NAFTA?
>These are all questions that need answering. It's time to speak directly
>about NAFTA's legacy.
>NAFTA: Good for the United States
>The real story of NAFTA is beginning to be told. A recent Business Week
>article on NAFTA concluded that "on its major objective -- promoting trade
>between the United States and Mexico NAFTA has been a huge success." But we
>need to get the details of the story out.
>We can begin with what NAFTA and open trade have meant for the average U.S.
>family. And these are conservative estimates: NAFTA and the Uruguay Round
>together have resulted in higher incomes and lower prices for goods, with
>benefits amounting to $1300 to $2000 a year for a family of four. That is
>real money for farmers, nurses, teachers, police officers, and office
>workers. The real beneficiaries are lower-income Americans, who bear a
>disproportionate burden when prices for food, clothing, and appliances are
>kept artificially high because of trade barriers.
>It is no coincidence that the longest period of economic growth in U.S.
>history, with levels of non-inflationary full employment beyond the
>forecasts of any economist, came in the aftermath of NAFTA. Ross Perot
>claimed that NAFTA would lead to "a great sucking sound" that would swallow
>U.S. jobs. Well, Ross Perot was right about a great sucking sound, but
>about the effect: NAFTA has been pulling American goods and grains into
>Mexico, benefiting consumers and supporting quality U.S. jobs here at home.
>In the seven years since NAFTA's implementation, U.S. exports to Mexico and
>Canada now support 2.9 million American jobs 900,000 more than in 1993.
>jobs pay wages that are 13 to 18 percent higher than the average American
>When the Congress approved NAFTA in 1993, trade between the United States
>and Mexico totaled $81 billion. Last year, our trade hit $247 billion --
>nearly half a million dollars per minute. U.S. exports to our NAFTA
>increased 104 percent between 1993 and 2000; U.S. trade with the rest of
>world grew only half as fast. Today we export more to Mexico than to
>Britain, France, Germany, and Italy combined.
>Time Magazine recently quantified the daily volume of the U.S.-Mexican
>trade: one million barrels of oil; 432 tons of bell peppers; 238,000 light
>bulbs; 166 Volkswagen Beetles; 16,250 toasters; and $51 million worth of
>auto parts. Mexico and the United States are being knit together in a
>variety of ways. The number of passengers flying between the United States
>and Mexico nearly doubled between 1988 and 1999. The border town of Laredo,
>Texas has the highest grossing Wal-Mart in the United States thanks to the
>active cross-border commerce.
>Earlier this year, as California faced an energy crisis, the Mexican state
>of Baja California stepped in to sell the San Diego area enough electricity
>to power 50,000 homes. More than 500,000 Americans live in Mexico, and more
>than 2,600 American companies have operations there.
>NAFTA has provided real benefits for real people. The Ray-Caroll County
>Agriculture Co-op in Richmond, Kansas credits NAFTA with opening the
>agriculture market, and as a result soybean exports to Mexico now
>65 percent of its total sales, up from 10 percent in the pre-NAFTA era. TRW
>reports that because NAFTA reduced tariffs and eliminated local content
>requirements on automobiles the company did not go through with its
>pre-NAFTA plans to move an automobile parts plant in Lebanon, Tennessee to
>Mexico. Instead, TRW has added more than 200 jobs at the plant since the
>U.S. agricultural exports to Mexico have nearly doubled since NAFTA was
>approved in 1993; our beef and veal exports have increased over five-fold;
>and our corn exports have increased nearly eighteen-fold.
>In the manufacturing sector, the value of U.S. textile and apparel exports
>to Mexico and Canada has doubled under NAFTA, reaching nearly $10 billion
>last year. Exports of American-made cars to Mexico have increased more than
>1;000 percent. I'm told that someone from DaimlerChrysler is in the
>audience, so you know the story of NAFTA. In 1993, Chrysler exported just
>5,300 vehicles to Mexico. The next year, with NAFTA in effect, it exported
>17,500. Last year, over 60,000 Chrysler vehicles were exported to Mexico.
>These exports support real jobs for real Americans, which is why I wonder
>about the wisdom of American auto union executives opposing trade
>that will boost auto exports.
>NAFTA has done much more than open export markets for American businesses
>though. By knocking down barriers to trade, it has boosted productivity and
>wages, reduced prices on everyday consumer goods, increased consumer
>and stimulated economic growth. NAFTA has helped boost the competitiveness
>of the entire U.S. economy -- a benefit that's felt throughout the United
>NAFTA: A Successful Model of North-South Relations
>Looking to North-South relations, the NAFTA legacy extends far beyond an
>agreement on trade. NAFTA represents a commitment by Mexico to modernize --
>politically and economically -- and a commitment by the United States and
>Canada to support this great change. NAFTA links Mexico to North America
>at the same time helps the United States and Canada realize the full
>potential of a new, larger North America.
>The NAFTA model signals an historic shift: In the 19' century strong
>countries wanted weak neighbors they could dominate. In the 21 St century,
>strong countries will benefit from prosperous, democratic neighbors.
>Troubled neighbors export problems. Healthy neighbors create regions of
>vitality, growth, and peace.
>NAFTA has been the means to finally fulfill a distinctly American dream of
>cooperative economic and political relations between the United States and
>Mexico dating back two centuries.
>But over the years U.S. relations with Mexico were marked mostly by
>disappointments and conflicts -- on both sides. Mexicans remembered that
>they lost about half of their new nation to the United States through war.
>Americans recalled Mexico's nationalization of U.S. investments, its
>reflexive hostility to U.S. foreign policies, and Mexico's retreat into
>During the 1980s, the twin pressures of a shrinking economy at home and a
>more competitive economy around the world spurred Mexico's leaders to
>a different economic path: they gradually deregulated and privatized the
>economy, signed the General Agreement on Tariffs and Trade, and opened
>Mexico to competition, fresh ideas, and new hope. The results were
>breathtaking: Today, Mexico is an economic -- and political -- success
>Indeed, NAFTA was a key to the political transformation of a modernizing
>Mexico. Since 1994, when NAFTA went into effect, the one-party state has
>yielded to governors from opposition parties in more than one-third of
>Mexico's states. Even the redoubt of Mexico City, the seat of centralized
>power for 500 years, fell to the free will of the electorate.
>Last year, Mexico's democracy sparked change at the highest level. In the
>freest and most open presidential election in the country's history, Mexico
>elected a new President, Vicente Fox, from an opposition party for the
>time since that nation's revolution. It was no accident that Mexico opened
>up its political system and embraced democracy after it liberalized its
>economic system through NAFTA. We have seen this same transformation in
>Taiwan, South Korea, and other parts of the world.
>The presidential election was also a referendum on how the Mexican people
>viewed NAFTA. NAFTA's opponents outside of Mexico often claim they are
>defending the Mexican people against an agreement that has led to
>exploitation. But when the people of Mexico had the opportunity to speak
>themselves, 80 percent of them voted for major-party candidates who
>North American free trade.
>Mexico's new era of democratic politics has helped foster more cooperative
>relations with the United States, Canada, and rest of the world. For much
>the 20' century, Mexico's leaders viewed the United States through an
>adversarial lens. Today, we are working cooperatively on issues spanning
>from the environment and drugs to law enforcement and immigration. NAFTA
>helped both countries developed a greater appreciation for the tremendous
>opportunities presented by being neighbors.
>There is a new, more open economic environment in Mexico. The prevailing
>spirit is one of free enterprise and equal opportunity, in which
>entrepreneurship is rewarded and graft is punished. Mexico has also begun
>develop closer links to not only the U.S. economy but the global economy.
>Following on the success of NAFTA, Mexico has signed free trade agreements
>with 32 countries -- including an agreement with the member states of the
>European Union. Mexico has also adopted a progressive leadership position
>within the World Trade Organization, helping to urge other developing
>nations to embrace the benefits of trade liberalization.
>Mexico's WTO role is a reminder that NAFTA's benefits extend beyond North
>America. NAFTA set an example for the rest of Latin America, sending an
>unmistakable signal in favor of democracy and open markets. As the reform
>movement gains momentum throughout Latin America, and as we press forward
>with the Free Trade Area of the Americas, it is more important than ever
>that we continue to build on NAFTA's successes.
>What Has NAFTA Accomplished for the People of Mexico?
>NAFTA has been a macro-economic success. But the essential questions are:
>What has NAFTA accomplished for the people of Mexico? And is NAFTA a model
>for developing nations?
>I occasionally think back to the Mexico I first experienced nearly 20 years
>ago. It was in the throes of a debt crisis, and the banking system had just
>been nationalized. Free trade with the United States -- or anyone else --
>was anathema to the country's leaders. The economy -- and the politicians
>lived off of protected, inefficient state-owned industries, especially its
>patrimony of oil.
>NAFTA brought a new level of competition to the domestic Mexican market, as
>U.S. companies faced many fewer barriers to entry. Mexico's businesses have
>had to adapt, and become more competitive, if they wanted to survive. For
>the most part, they have survived, and many have thrived.
>Today, Mexico has one of the most open -- and vibrant -- economies anywhere
>in the developing world. Despite financial upheaval, exacerbated by the
>rigidities of the old order, Mexico's gross domestic product grew, on
>average, 3.5 percent annually in the 1990s. Over the last five years,
>Mexico's GDP has grown at an average annual rate of 5.5 percent.
>Ernesto Zedillo, Mexico's former president, has said, "NAFTA has been
>crucial in transforming Mexico into one of the world's biggest exporting
>powers." Indeed, NAFTA has fueled Mexico's economic growth; more than half
>of the 3.5 million jobs created in Mexico since 1995 are connected to
>As Mexico has become more competitive at home, its companies have expanded
>into other markets. The value of its mergers and acquisitions abroad
>in 1999 over the previous year. A number of leading Mexican companies, such
>as Grupo FAMSA, a furniture and electronics retailer, and Cemex, a cement
>producer, have even opened operations in the United States.
>As Mexico has become a player in the global economy, the discipline of
>markets has helped to reform its economy. Inflation, which averaged 100
>percent in the 1980s, is now in single digits a major breakthrough for
>Mexico's poor. The government's budget deficit -14 percent of GDP in 1987
>is now one percent of GDP. And many protected sectors of the economy, such
>as the railroads, have been privatized and are thriving.
>This transformation benefits the Mexican economy, and the Mexican people.
>Consider the telecom sector. As prices have come down, more people can
>afford to make more calls. The total number of minutes of local telephone
>service has been growing by more than 12 percent a year for the past
>and the number of long distance minutes has been growing about 16 percent a
>NAFTA also helped Mexico's resilience amidst the challenges of
>globalization. Following the 1982 peso crisis, it took Mexico seven years
>be able to borrow again in international financial markets; after the
>financial shock of 1994-95, with the help of NAFTA, it took just seven
>months. Following the 1982 crisis, it took seven years for U.S. exports to
>Mexico to reach their pre-crisis levels; after the 94-95 shock, it took
>The old corporate state of Mexico is yielding to a new civic society. The
>press is now more independent, and more honest -- a striking contrast to
>state-controlled media of years past. NGOs, lobbying for environmental and
>human rights causes, have blossomed.
>NAFTA has also laid the groundwork for environmental improvements, giving
>the Mexican government new incentives to pass environmental legislation and
>improve enforcement efforts. As a result, Mexico has higher environmental
>standards than in the pre-NAFTA era. Through the North American Commission
>for Environmental Cooperation, created by NAFTA, Mexico and the United
>States have a forum for addressing environmental issues of continental
>concern, such as emissions levels and biodiversity protection. In the El
>Paso/Ciudad Juarez area, a cross-border air quality committee has been
>established to remedy local air pollution problems. NAFTA created a border
>commission, with public hearings, that approves sewage and water projects
>near the U.S.-Mexico border.
>Developing nations frequently fail to invest their capital productively.
>NAFTA has helped solve this problem for Mexico, by creating a more stable
>and predictable environment for investment and leading foreign capital
>toward more productive and efficient uses. Talking about investment
>sometimes sound cold and abstract to opponents of trade. But investment is
>what enables Mexico's industries to modernize, Mexico's people to make the
>transition from subsistence to steady employment, and Mexico's children to
>attend quality schools that will better equip them to compete in a digital,
>There is something tragic about seeing the leaders of almost every poor,
>developing country imploring the United States to expand free trade with
>their countries while a movement of largely middle and upper class
>protesters in developed nations try to close the door of opportunity. As
>President Bush noted in his speech to the World Bank last week, "Those who
>protest free trade are no friends of the poor. Those who protest free trade
>seek to deny them their best hope for escaping poverty." Ernesto Zedillo
>said of the protesters that they "seem strangely determined to save the
>developing world from development."
>All of us want to see trade support protection of the environment and core
>labor standards. But in the end, the numberless and voiceless poor will
>have a chance to raise their living standards and offer a better life for
>their children if global trade and investment flows continue to expand.
>Beyond NAFTA: Restoring Momentum for Trade Liberalization The tremendous
>success of NAFTA underscores the importance of expanding free trade
>throughout the hemisphere -- and the world. When President Bush assumed
>office, the clouds of the failure to launch the new round of global trade
>negotiations in Seattle were still hanging low, leaving many dispirited
>around the world. These troubles strike at the heart of the global trading
>If you look at the record of the past few years, the United States has been
>falling behind. Today, the European Union has 27 free trade or special
>customs agreements around the world, 20 of which it negotiated in the
>it is negotiating another 15 right now. Countries throughout East Asia are
>quickening the pace of special trade negotiations. Japan is negotiating a
>free trade agreement with Singapore, and is exploring free trade agreements
>with Canada, Mexico, Korea, and Chile. In our own hemisphere, there are 30
>free trade agreements, and the United States is party to only one.
>President Bush decided to regain momentum for America by pursuing trade
>globally, regionally, and bilaterally. We are creating a "competition in
>liberalization" with the United States at the center of a network of
>initiatives. We are backing words with actions across this agenda, and we
>are starting to see results.
>In the first six months of the Bush administration, we have made progress
>turning the idea of the Free Trade Area of the Americas into a reality.
>The importance of breaking down barriers throughout the hemisphere is
>epitomized by the experience of Caterpillar -- headquartered in my home
>state of Illinois. Caterpillar's motor graders made for export to Chile
>nearly $15,000 in tariffs. When Caterpillar manufacturers motor graders in
>Brazil for export to Chile, the tariff is just $3,700. And when
>Caterpillar's competitors produce the same product in Canada, it can be
>exported to Chile free of tariffs because of the Canada-Chile free trade
>We are also negotiating free trade agreements with Chile and Singapore,
>sending a signal to the nations of Latin America and the rest of the world
>that the United States will reward good performers.
>On the global front, after 15 years of negotiations we have broken through
>the last major barriers to China's accession to the WTO.
>We are working with all the members of the WTO -- developed and developing
>nations -- to ensure a successful launch of a new round of global trade
>negotiations less than 15 weeks from now in Doha.
>Under President Bush's leadership, the United States is returning to where
>it belongs -- at the center of global trade, not on the sidelines.
>But wherever I go, and whatever progress we make, I am asked the same
>question: Will the Congress support the administration in trade? Will the
>Congress grant President Bush the negotiating authority granted to each of
>the previous five presidents?
>We need your help. And we need it now. Not next year. Not next week. Now.
>This is not an abstract debate on trade policy. I'm at the table now --
>every day -- negotiating with countries from around the world. They have
>full authority to negotiate for their nations' interest. I need it, too.
>If we are unable to overcome the stain of Seattle by launching a new round
>of global trade negotiations, special trade agreements will proliferate
>more quickly -- most often without the United States. America will not be
>the table helping to set the trade rules of the 21st century. Our absence
>will curtail consumer choice, increase prices, and undermine American
>NAFTA illustrates one of the fundamental truths about trade: Trade is not a
>"you win, I lose" proposition. By generating growth, trade multiplies the
>purchasing power of our trading partners, which in turn benefits our
>businesses, farmers, workers, and consumers.
>We should strive for more NAFTAs, to help build a world that trades in
>freedom -- opening new markets for producers, new choices for consumers,
>new avenues for political and economic cooperation between governments.
>By pursuing this hopeful vision, we can set a course of peace and
>-- for the United States, our NAFTA partners, and the global system -- for
>decades to come.
>(Distributed by the Office of International Information Programs, U.S.
>Department of State. Web site: http://usinfo.state.gov)
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