|
 Thank
you. Very briefly, just to fill you in here, I am here because Brazil is a very
important country for  the
United States. This is the first trip to South America that I've taken on my
own. I accompanied the Under-Secretary of State Mark Grossman, who was also
here, on a trip to Colombia. But I wanted to come as soon as possible -- I have
been to other parts of the hemisphere -- to Brazil, and I am going on to
Argentina and Uruguay, to primarily to learn all about what is happening and try
to find out how we work even more closely together. We consider Brazil a very
good friend of the United States, a fellow democracy, a country with which we
have very good relations, so good in fact that when a problem arises such as
trade, some trade problem, it becomes magnified because of the lack of other
more serious problems. I am not minimizing the importance of trade, but when
taken in the context of international relations today, what is happening in the
world with terrorism, narco-trafficking, organized crime, pollution and
everything else, our relations with Brazil stand out as very good. So however,
they require constant observation, even with our close friends, and so I am here
to ... I've had a series of meetings with a broad range of government officials
-- primarily, of course, with Foreign Ministry, which is our counterpart -- and
discussed a number of topics. So, I'd be happy to try and answer some of your
questions.
Q:
Can you tell us, Mr. Ambassador, what your talks with General Cardoso, today
were about?
Asst.
Sec. Reich:
Actually, I started out by congratulating him on the Brazilian victory in the
World Cup, and that is the truth. What?... There were other issues, sure. We
talked about the cooperation we have received from Brazil on some of these
serious issues that I had discussed: terrorism, narco-trafficking, international
crime, for example. And I have to say that we have excellent cooperation with
the Brazilian authorities on those matters. But I'd rather not get into specific
details, obviously.
Q:
About Foz do Iguaçu too?
Asst.
Sec. Reich:
Say again?
Q:
Foz do Iguaçu. The
frontier.
Asst.
Sec. Reich:
We talked about the whole range of common threats to Brazil and the
United States and to the democracies of the region. And we have talked with our
friends in Argentina, in Paraguay, and now Brazil about the problems that exist
in that region.
Q:
I would like to ask you a question: In your opinion, is the Mercosul becoming
weaker and weaker? I mean, Brazil used to see the Mercosul as a step in order to
reach the FTAA. Do you think this is real? Does it make sense?
Asst.
Sec. Reich:
Well, look, every country and region – sometimes entire continents --
go through cycles, economic cycles, ups and downs. And there is no question that
right now the countries of Mercosul are going through one of the down stages in
the cycle. The United States still believes that the best way to build a Free
Trade Area of the Americas by the year 2005 is through negotiations with
sub-regional groupings -- such as Mercosul; such as the five Central American
countries with which we have begun conversations leading to a free trade
agreement; such as the Andean Pact; or Caricom for the Caribbean.
But
we are also willing to talk to individual countries. We are close to negotiating
a bilateral free trade agreement with Chile, for example. We believe that a free
trade agreement will benefit the entire hemisphere. We have seen countries that
participate in free trade grow much faster than those that do not
participate in free trade
and we believe this will be good, a free trade agreement will be good for all
the nations of the Hemisphere. But, whether we get there through bilateral or
multilateral negotiations will depend on what the other countries want to do and
on the circumstances prevailing at the time.
Q:
Is it possible that this is the case between the United States and Brazil:
bilateral?
Asst.
Sec. Reich:
Anything is possible but I think that is up to Brazil to decide whether they
prefer to negotiate as part of a group or bilateral.
Q:
But is this an invitation?
Asst.
Sec. Reich:
No, this is not an invitation. You asked me a hypothetical question,
meaning -- is it possible? Anything is possible but I am not issuing an
invitation. I mean, the purpose of my visit, contrary to one of the headlines I
saw in one of the newspaper reports, I am not here to negotiate a free trade
agreement. I am here, as I said earlier, to convey the importance that the
United States assigns to Brazil in our global relations and to learn more about
the situation here on the ground.
Q:
So, do you think it easier to negotiate tète a tète, face to face, than in the
framework of regional agreements?
Asst.
Sec. Reich:
No. I said we have done both. We have negotiated bilaterally and we have
negotiated... For example: NAFTA. We started out with a free trade agreement
with Canada. Then, we negotiated a North American Free Trade Agreement with
Canada and Mexico. We are negotiating a bilateral agreement with Chile. At the
same time, we've offered the five Central American countries a regional
negotiation and they are very enthusiastic about it. So, we are willing to
accomplish this end, if it is in the interest of the, if the countries in the
region see it in their interest, in the most feasible manner.
Q:
In your conversations of common threats, how did you characterize the situation
in Colombia? This threat includes of Venezuela, the triple border?
Asst.
Sec. Reich:
Well, there is no question that Colombia is a country that deserves the
support of the Hemisphere. It is a democracy, has a freely-elected government,
and has just indicated again -- the vast majority of the people of Colombia who
were eligible to vote came out in very large numbers, in spite of threats from
the guerrillas and efforts, in fact, to stop the voting. They came out and
elected Alvaro Uribe as their president. They are a strategic country. I mean,
Colombia is a country with borders on Central America to the North, on the
Amazon, in the Andes and on both Oceans. It is the only country in South
America, for example, with borders on the Caribbean and the Pacific. It is a
friendly country. We have very good relations. I believe Brazil has good
relations with Colombia. I understand president-elect Uribe is coming to Brazil
sometime in the near future. And he's been to Washington. We've talked with him.
In fact, I met with him in Bogota even before he was elected and after he was
elected. And we think that the threat to Colombia's democracy is a common threat
not just to the United States and Brazil, but to the whole Hemisphere. And, if
countries are worried about the spillover effect of, say, "Plan
Colombia", they should be even more worried about the effect of not
stopping the terrorists and the narcotics traffickers inside Colombian borders.
Because, if these people work to ever gain control over larger parts of
Colombian territory, I think there is no doubt that they would take their
business, which is narcotics and terrorism, to other countries. They, I don't
think are only interested in taking control by force of Colombia. I don't think
they know any borders. Terrorists sans frontiers, to coin a phrase.
Q:
Mister Ambassador, just coming back a little bit on the FTAA process. There is a
very difficult situation in Latin American nowadays. Do you think, isn't it very
dangerous for Latin America to negotiate such an important negotiation like that
with different crisis in different intensities like in Argentina, with the
economic crisis, in Uruguay, in Brazil too and with threats to the democracy in
Venezuela, Ecuador, with such difficult problems, there is not a favorable
scenery for Latin American countries. The scenery is very favorable to the
United States, but not favorable to the Latin American countries.
Asst.
Sec. Reich:
Look, a free trade agreement, by definition, should benefit both or all parties
involved. I think in fact you can turn your question around and ask: wouldn't
Latin America been better off facing these crises with a free trade agreement
already in place? And I will give you the example of Mexico. The free trade
agreement was negotiated in early 90's, was ratified in 1993 and came into
effect January 1st of 1995. Ten days before that, or 11 days before, on December
20, 1994, the peso collapsed. People who know more about this than I do tell me
that as bad as the effect of that collapse of the peso was on the Mexican
economy it would have been much worse had it not been for the fact that NAFTA
came into effect 11 days later. And the Mexican economy, since 1995 has created
three and a half million jobs, of which half are directly related to NAFTA or to
exports, or trade and most of their trade is of course with the NAFTA countries.
Mexico since 1995 has gone from number 36 in the world in terms of exports to
number 8 and is very close to number 5. It is the 2nd largest trading
partner of the United States. I think, with all due respect that you can turn
you question around and say, wouldn't it be better for the Latin American
countries to have a cushion such as a free trade area to enable them to overcome
the inevitable economic cycles? Economies have cycles, the United States
recently we had a small economic setback. I don't think it was officially
declared a recession, I think it requires three quarters or three consecutive
quarters. But still, one of the things that helped us is the fact that we are
the world leading exporting, or one of the world's leading exporting countries.
Korea, a few years ago, the Korean economy practically collapsed. You recall
that. You don't hear that any more. Why? Because the Koreans took advantage of
their economic collapse. In fact they lowered the value of their currency to
export enormously around the world. They now are competing even in the United
States. For example, in the automobile sector, companies like Hiundai and Daewoo
and Kia were not known fifteen years ago.
Q:
Ambassador, the advantages of free trade just come when you negotiate well and
we are not in a good moment to negotiate well.
Asst.
Sec. Reich:
Why, don't you have confidence in your negotiators?
Q:
No, because we are in a difficult scenery.
Asst.
Sec. Reich:
Look, I think...believe me, I have been across the table from Brazilian
diplomats and I can tell you, you should have more confidence. They are very
skilled. They are known around the world as some of the toughest, fair, but
tough negotiators and I think that you have nothing to fear from the
negotiations. And nobody is going to force anyone to sign a treaty that is not
in their interest. A negotiation is a process by which both parties feel
comfortable in the result.
Q:
The two countries you mentioned, Mexico and South Korea got a good deal of
money, I believe to combat crises. For instance, there is some talks now that
Brazil is now to seek more IMF money to see it to its cycle of election cycle
which is coinciding with the down cycle in the economy. Would the United States
support such a transition package to Brazil.
Asst.
Sec. Reich:
What I would say is I believe here that you are getting into an area where I
know there has been some controversy. We believe the Brazilian economy has been
well managed. Secretary O'Neill said that. What I think he was referring to that
created controversy was in fact the preface of your question. The fact that the
down cycle has coincided with the political or the election. But we are
confident about the fundamentals of the Brazilian economy. We think they have an
excellent
economic team and political leadership, they are a friend, you know I wouldn't
what to speculate as to what needs Brazil would have in the future. But we will
do whatever is necessary to help Brazil out of a, certainly out of a problem not
of his own doing, if you understand.
Q:
One more question....
Asst.
Sec. Reich:
Just one.
Q:
Ambassador, could you speak about the situation in Argentina and your
expectation.
Asst.
Sec. Reich:
I am sorry?
Q:
About in Argentina? Can the U.S. government support on an agreement between IMF
and Argentina?
Asst.
Sec. Reich:
Well, we have been encouraging both the government of Argentina and the
IMF to come to an agreement. I believe that in Argentina the problem basically
is the economic policy. It is no secret that people know that there are three
obstacles left, three obstacles that were left to reaching an agreement. The
bankruptcy law, the economic subversion law which frankly made it very
difficult for foreign investors, and bankers particularly, to do business
in Argentina, which is essential to an economic recovery, and the relationship
between the central government and the provinces. They've made progress on all
of them. I hope that an agreement will be concluded soon. I saw some
declarations in the press yesterday by the Argentine finance minister, wasn't it
Gerry? That they expect an agreement by next month, by August.
Aide:
Yes, that is what they say.
Asst.
Sec. Reich:
Yes, that is what the Argentine said. We would like to see it of course sooner,
but once again that is an agreement between Argentina, a sovereign country, and
the International Monetary Fund, an international organization. People say that
we tell the IMF what to do, because we are the largest contributor to the IMF. I
remind you that we are also the largest contributor to the UN, and nobody
accuses us of telling the UN what to do. We have some differences of opinion on
a number of things but we belong to all these international organizations, we
think they have an important role to play, and we are encouraged by the progress
that has been made and the purpose of my visit is in fact to send a signal to
the Argentine people that the United States does stand with them.
Argentina
is a democracy and it is interesting to see that in spite of these very
difficult problems and I am not trying to minimize what you said, I agree that
these are very difficult time in Latin America. But in spite of all these
problems, that the Argentine democracy has withstood and that all of the changes
of government we have seen there have taken place within their constitutional
rule and processes. And we are very encouraged by that. And we want to support
that. This is the only continent in the world where democracy is a sine qua non
for membership in the regional organization. In our case, in the Organization of
the American States. This is not the case in the other developing countries, of
Africa, Middle East, Asia, etc. This is a different continent. It is a continent
of democracies and, as Winston Churchill said: democracy is the worst system of
government with the exception of all others. Everything is relative. Democracy
has a lot of problems but the alternatives are much worse. And the same goes for
the capitalist system, the free market system. It may be the worse system of
all, with the exception of all the others. We know that communism doesn't work,
that fascism does not work. So we continue to support democracy, free markets,
private enterprises as the best way to provide the most opportunity and freedom
to the largest number of people.
Q:
Listen, does it sound good to the United States that there will be elections in
Argentina in March, next March?
Asst.
Sec. Reich:
To the United States?
Q:
Yes, to the United States.
Asst.
Sec. Reich:
We have nothing to do with it.
Q:
Nothing to do?
Asst.
Sec. Reich:
Absolutely nothing to do with that.
(Inaudible)
Q:
What is your expectation about Bolivia. The election...
Asst.
Sec. Reich:
We are watching it closely and we congratulate the people of Bolivia for
participating in another democratic exercise, but it's up to the Congress of
Bolivia to decide.
Q:
So can the cocalero go to the...(inaudible)
Asst.
Sec. Reich:
I think our views are well known. We support democratic leaders. We're
very much opposed to drug trafficking or anybody who supports drug trafficking.
Q:
Would you be able to just leave a message about steel? I know it's not your
area, but...
Asst.
Sec. Reich:
It's a very strong element, and essential to... construction...
(Inaudible)...
[several voices at once; laughing...]
Aide:
...One of your ministers is waiting...
Q:
Do you think that President Bush will visit Brazil next year?
Asst.
Sec. Reich:
I don't have any immediate plans but I would love to see him visit every country
in the region.
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July
16, 2002
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