United States international economic policy

DISAM Journal, Winter, 2003 by E. Anthony Wayne

[The following are excerpts from the speech presented to The Hoover Institution, Stanford University, Palo Alto, California, December 4, 2003.]

My topic today is how the Department of State advances US international economic policy goals. Economics is vital to the foreign policy of the United States, and my office, the Bureau of Economic and Business Affairs (EB), is the center of the Department of State's effort to develop and implement America's international economic policy. We work on a wide range of issues from civil aviation agreements to terrorist financing, from debt restructuring to communications policy, from trade negotiations to international petroleum reserves. We work with posts around the world, other bureaus in the Department of State, some forty US agencies, 189 foreign governments, and hundreds of businesses and non-government organizations.

In these efforts, we focus on three broad priorities:

* First, in the area of development, we do our best to ensure that poor nations participate fully in a rising tide of prosperity.

* Second, we try to assure our economic security.

* Third, we work to advance global prosperity by expanding trade and investment between nations.

Economic Security

The atrocities on September 11, 2001 compelled all of us in the US government to refocus priorities. At Economic Bureau, we have made economic security a core responsibility, shifting resources and personnel accordingly. To ensure our economic security, we must focus on four tasks in the coming years.

* First, we must cut off the financing of terrorism. The United States and its partners have worked very closely to disrupt the flow of money to terrorists and to their supporters. We have led international efforts, under the auspices of the UN, to identify and block assets to nearly 250 designated terrorist individuals and groups. We have disrupted their ability to finance operations and access the funds of charities to carry out acts of violence against us and our friends. We have broadened the mandate of the Financial Action Task Force (FATF) to include terrorism.

With thirty-one members, the FATF is the world's leading international organization on combating financial crime. Alongside our allies, the United States has improved coordination of technical assistance to countries at the frontline of the war on terrorism to develop their capacity to cut off the flow of funds to terrorists. Although our work has not finished, terrorists now find it much harder to move money and assets around the world.

* Second, we must ensure stability of the international financial system and the economic stability of key allies. It is in our interest to make sure that those nations engaged in the front-line of the war against terrorism are not threatened by economic and financial instability. To that end, we worked with the Treasury Department to fulfill the President's promise to provide one billion dollars in debt reduction for Pakistan and to develop international monetary fund rescue and reform packages for Turkey, Jordan and Pakistan.

We continue to work actively with other countries, the international financial institutions and the private sector to prevent financial crises in such front-line states and to resolve them more effectively when they occur. Promoting regional trade will also play an important role in fostering economic growth.

* Third, we must develop diversified and reliable supplies of energy. Energy remains a vital economic ingredient for the United States and other industrial democracies, and economic growth and prosperity will require expanded supplies of energy including oil and gas. A vibrant, open world economy, and a well functioning international financial system are vital factors helping us find more oil and gas supplies. These supplies must be reliable and made available at prices that permit sustained economic growth. We engage intensively with energy partners all over the world to diversify supplies, improve investment opportunities, encourage continued research into alternative sources, and assure that market forces work as transparently and efficiently as possible.

* Fourth, we must make international transportation of people and goods safe and secure. The United States is the world leader in transportation security. We have worked successfully with foreign governments and international organizations to ensure the safety of passengers and cargo. Maritime shipping is among the most international of transport industries but it is also one of the most exposed to the danger of terrorist attack.

We have taken a number of steps to protect our ports and seaways, including implementation of new national and international security requirements for ships, ports and terminals, requirements for more information about ship arrivals and cargoes, and enhanced container security measures.

Development

We start with the premise that only substantial and rapidly expanding trade and investment can generate sustainable economic growth on the scale needed to lift entire nations out of misery. But foreign assistance, wisely channeled can play an important part in creating the conditions that attract trade and investment in the first place. The international community agreed to these two important premises at the Monterrey Summit on Financing for Development.