Powell calls for new round of trade talks

By Amit Baruah

HANOI, JULY 26. The U.S. Secretary of State, Gen. Colin Powell, today made a big pitch for a new round of trade negotiations and encouraged the Association of South-East Asian Nations ``not to waver'' in their commitment to free trade and implement the ASEAN Free Trade Area (AFTA) on schedule.

``Developing countries can be among the big winners if there is a market opening round. The reduction of the country's trade barriers will benefit consumers and allow introduction of products and technologies that will spur innovation and put its economy on a more competitive, export-oriented footing. Second, the reduction of trade barriers in other countries will create important export and job-creation opportunities,'' Gen. Powell stated.

Reduced trade barriers in all countries, he felt, would stimulate a new surge of international investment. ASEAN, according to him, was full of examples demonstrating that private sector involvement is crucial to economic growth and development.

``Regional integration, if it is comprehensive and WTO- consistent, can be an important step towards global trade liberalisation. The United States believes that ASEAN's decision to create the ASEAN Free Trade Area was a good one. We encourage you not to waver in your commitment to free trade and to implement AFTA on schedule,'' he told the Foreign Ministers at the meeting.

According to him, a dynamic, growing, world economy was the ultimate poverty reduction strategy. ``At the G-7/G-8 meetings in Genoa, each of the leaders committed to put in place pro-growth strategies. The U.S. is leading the way by taking decisive action, including tax cuts and by maintaining dynamic, flexible domestic markets,'' he maintained.

``We are also very interested in Japan's efforts to restructure its economy and ultimately return to strong growth. I would like to note President Bush's statement after meeting with Prime Minister Koizumi last month that the U.S. supports Japan's current reform plans and believes the Japanese leadership is on the right track...'' he said.

Gen. Powell said the assistance was most effective in countries with sound economic management and good governance practices. The Government, he said, played a vital role in creating the needed legal and economic environment to build investor confidence, enhance education and improve worker skills, but it is the private sector that creates the jobs and economic activity that lifts families, as well as entire countries, out of poverty.

Countries which focused on creating an environment where the private sector can thrive - promoting the rule of law, reducing corruption and improving productivity through better education, nutrition, and health programmes - will attract international support and prosper.

``There is also great interest here in the global economic outlook. Recent turbulence in emerging markets and the slowing of economic growth in key economies is being watched closely by all of us.

``Our experience since the 1997-98 financial crisis shows that economic reform efforts have paid off by strengthening economies against market contagion from such turbulence. Corporate and banking restructuring, regulatory reform, and transparency need to be achieved. Without them, macro-economic vulnerability remains.

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