Secretary of State Hillary Rodham Clinton participated in a live webcast to discuss "Principles for Prosperity in the Asia Pacific" in Hong Kong on July 25, 2011. Secretary Clinton said, "...I have come here today to talk about how the nations of this region and the United States can intensify our economic partnership on behalf of ourselves, each other, and the world, and how together we can work toward a future of prosperity and opportunity for people everywhere.
"But before I talk about where we need to go together, let's consider how far we've come. The economic rise of the Asia Pacific region is an astonishing historic achievement that is reshaping our world today and into the future. In Hanoi, bicycles and water buffalo have given way to motorcycles and internet cafes. Small Chinese fishing villages like Shenzhen have become megacities with their own stock exchanges. And while much work remains to improve labor practices and expand access to the formal economies, the numbers tell a powerful story."
She continued, "...[T]hough this progress is largely due to the hard work and ingenuity of the people of Asia themselves, we in the United States are proud of the role we have played in promoting prosperity.""...[T]he U.S. continues to contribute to Asia's growth as a major trade and investment partner, a source of innovation that benefits Asia's companies, a host to 350,000 Asian students every year, a champion of open markets, an advocate for universal human rights, and a guarantor of stability and security across the Asia Pacific. The Obama Administration has made a comprehensive commitment to reinvigorate our engagement as a Pacific power -- shoring up alliances and friendships, reaching out to emerging partners, and strengthening multilateral institutions.
"These efforts reflect our optimism and enthusiasm for what is happening in Asia today. Of course, countries in this region are grappling with challenges. We all are. But we are bullish on Asia's future, and while the United States is facing its own difficulties, make no mistake: We are bullish on America's future too.
"America remains an opportunity society -- a place to excel, a country of possibility and mobility where a brilliant idea hatched in a college dorm room or a product invented in a garage can find a global market and grow into a multibillion dollar company. Our workers are the world's most productive. Our inventors hold the most patents. And today, we are reinvesting in our fundamentals -- infrastructure, clean energy, health, and education. And we are doing the critical work of shoring up our financial system so that it protects investors and curbs excesses.
"Now, as I have traveled around the region, a lot of people have asked me about how the United States is going to resolve our debt ceiling challenge. Well, let me assure you we understand the stakes. We know how important this is for us and how important it is for you. The political wrangling in Washington is intense right now. But these kinds of debates have been a constant in our political life throughout the history of our republic. And sometimes, they are messy. I well remember the government shutdown of the 1990s; I had a front row seat for that one. But this is how an open and democratic society ultimately comes together to reach the right solutions. So I am confident that Congress will do the right thing and secure a deal on the debt ceiling, and work with President Obama to take the steps necessary to improve our long-term fiscal outlook."
Secretary Clinton continued, "...As we pursue recovery and growth, we are making economics a priority of our foreign policy. Because increasingly, economic progress depends on strong diplomatic ties and diplomatic progress depends on strong economic ties.""...[N]aturally, much of our economic diplomacy is focused on East Asia and the Pacific. The American Chamber in Hong Kong represents 1,200 companies, and thousands more looking to this region for new customers and markets. Last year, American exports to Hong Kong totaled $26 billion -- that's more than the Indonesian export amount of $20 billion -- and our exports to the Pacific Rim were $320 billion, supporting 850,000 American jobs.
"Now, numbers like these reflect how closely America's future is linked to the future of this region. And the reverse is true as well. Because the future of the Asia-Pacific is linked to America's. We are a resident power in Asia -- not only a diplomatic or military power, but a resident economic power. And we are here to stay."
Secretary Clinton said, "...Prosperity is not a birthright, it's an achievement. And whether we achieve it will be determined by how we answer a defining question of our time: How do we turn a generation of growth in this region into a century of shared prosperity?
"The United States approaches this question with great humility, and with hard-won lessons learned from overcoming difficult economic challenges throughout our history.
"We must start with the most urgent task before us: realigning our economies in the wake of the global financial crisis. This means pursuing a more balanced strategy for global economic growth -- the kind that President Obama and President Hu Jintao have embraced, and the G20 is promoting.
"This demands rigorous reform by all nations, including the United States and the countries of Asia. We in the United States are in the middle of a necessary transition: we must save more and spend less. And we must not only save more and spend less, we must borrow less, as well. Our partners must meet this change with changes of their own. There is no way around it: Long-term growth requires stronger and broader-based domestic demand in today's high-saving Asian economies. This will raise living standards across the region, create jobs in America, improve business for many in this room, and help stabilize the global economy."
She continued,"...Last March in APEC meetings in Washington, I laid out four attributes that I believe characterize healthy economic competition. And these are very simple concepts, easy to say, hard to do: open, free, transparent, and fair.""...First, we must seek an open system where any person anywhere can participate in markets everywhere.
"...Second, we must seek a free system, one in which ideas, information, products and capital can flow unimpeded by unnecessary or unjust barriers.""...Third, we must seek a transparent economic system. Rules and regulations need to be developed out in the open through consultation with stakeholders. They must be known to all and applied equally to all.""...Openness, freedom and transparency contribute to the fourth principle we must ensure: fairness. Fairness sustains faith in the system. That faith is difficult to sustain when companies are forced to trade away their intellectual property just to enter or expand in a foreign market, or when vital supply chains are blocked."
The Secretary said, "...A growing number of countries in Asia are proving the value of these principles. And the United States deeply believes in them, because their value has been proven time and again, not only in times of prosperity but also in times of hardship, as well. At the end of the Vietnam War, there was a thriving commentary around the world on the idea of America's economic decline. That seems to be a theme that kind of repeats itself every couple of decades. But all the while, then and now, these principles were nurturing a system of entrepreneurship and innovation that allowed two college students to found a small tech startup called Microsoft.""...[N]o nation is perfect when it comes to safeguarding these principles, including my own. We all recognize the temptation to bend them. And we all recognize the inevitability of human nature's capacity to look for ways around them. Some nations are making short-term gains doing that. Some developing countries -- admirably focused on fighting poverty -- might be slow to implement at home the same rules they benefit from abroad. And a number of nations, wealthy in the aggregate but often poorer per capita, might even think the rules don't apply to them.
"In fact, all who benefit from open, free, transparent, and fair competition have a vital interest and a responsibility to follow the rules. Enough of the world's commerce takes place with developing nations, that leaving them out of the rules-based system would render the system unworkable. And that, ultimately, that would impoverish everyone.""...The United States is taking steps to promote these principles around the world through multilateral and regional institutions, new trade agreements, and outreach to new partners, to enlist us all in the quest for inclusive, sustainable growth. These steps are connected to and build upon the work we are doing to revitalize our own economy.""...Just as the WTO eliminated harmful tariffs in the 1990s, today we need institutions capable of providing solutions to new challenges, from some activities of state-owned enterprises to the kinds of barriers emerging behind borders.
"We also support innovative partnerships that develop norms and rules to address these new concerns. We should build on the model of the Santiago Principles on sovereign wealth funds, which were negotiated jointly by host governments, recipient governments, the World Bank, IMF, OECD, and the sovereign funds themselves. This code of conduct governing sovereign investment practices has reassured stakeholders -- investor nations, recipient nations, and the private sector. And it may prove a useful model for other shared challenges, like ensuring that state-owned companies and enterprises compete on the same terms as private companies.
"As a second step, we are pursuing new cutting-edge trade deals that raise the standards for fair competition even as they open new markets...President Obama is pursuing congressional approval of KORUS, together with necessary Trade Adjustment Assistance, as soon as possible. He is also pursuing passage of the Colombia and Panamanian Free Trade Agreements as well.""...We consider KORUS a model agreement. Asian nations have signed over 100 bilateral trade deals in less than a decade, but many of those agreements fall short on key protections for businesses, workers, and consumers. There are a lot of bells and whistles, but many of the hard questions are glossed over or avoided.
"Our goal for TPP (Trans Pacific Partnership) is to create not just more growth, but better growth. We believe the TPP needs to include strong protections for workers, the environment, intellectual property, and innovation. It should also promote the free flow of information technology and the spread of green technology, as well as the coherence of our regulatory system and the efficiency of supply chains.
"We are working to ensure that the TPP is the first trade pact designed specifically to reduce barriers for small and medium-sized enterprises. After all, these are the companies that create most of the world's jobs, but they often face significant challenges to engaging in international trade. So, the TPP aims to ensure fair competition, including competitive neutrality among the state-owned and private enterprises.
"The idea is to create a new high standard for multilateral free trade, and to use the promise of access to new markets to encourage nations to raise their standards and join. We are taking concrete steps to promote regional integration and put ourselves on a path over time to bring about a genuine Free Trade Area of the Asia Pacific.
"Finally, we need to pursue strategies for achieving not just growth, but sustainable, inclusive growth. Now, it is a maxim of mine that foreign policy must deliver results for people. Because ultimately, our progress will not be measured by profit margins or GDP, but by the quality of people's lives -- whether men and women can work in dignity, earn a decent wage, raise healthy families, educate their children, and take hold of the opportunities to improve their own and the next generation's futures.
"The United States supports a number of endeavors to promote inclusive growth in the region. Our Millennium Challenge Corporation, for example, makes large-scale investments in partner countries to reduce poverty through growth. We have a compact with the Philippines to invest in roads, community development projects, and more effective tax collection. We are negotiating a compact with Indonesia to promote low carbon development, and we began a threshold partnership with Timor-Leste earlier this year to fight corruption and improve children's health.
"Across the region, we are partnering with governments to encourage and help them uphold their commitments to inclusive growth by practicing good governance, providing public goods like health and education, and creating tax systems that improve revenue collection and ensure that everyone pays their fair share. We are supporting civil society and citizens alike in holding governments accountable, supplying job training and networking, and being a strong voice for bringing opportunity to places where it is scarce."
She continued, "...[W]e are working very closely with the private sector...There are so many ways that we are grateful to the private sector. After all, it drives what we are talking about today. But we do need to try to consider, even within the constraints of modern financial practices and expectations, not just short-term benefits but long-term consequences. The work that each of you do in your businesses can help lift people's lives, promote human rights and dignity, and create new markets, creating a virtuous cycle. Or it can further ensnare people in poverty and environmental degradations, creating a vicious cycle.
"And what is standing in the way of achieving that vision? Well, there are many issues and challenges we can enumerate, but ultimately, it comes down to leadership --- leadership in both the public and the private sector. We were blessed over the last part of the 20th century with farsighted and effective leaders in many parts of the world, leaders who set the rules that created the economic growth that we enjoyed in the 20th century, leaders who changed course in their own nations and catalyzed the extraordinary growth that we have seen in a country like China, leaders who had visions, private sector leaders who were able to look over the horizon and understand the consequences of not just this quarter's results but the decades. We need that leadership again. We need it everywhere. And we need it both in governments and in business. That's why the partnership between the public and private sectors is so essential.""...We face a lot of similar challenges today, and we need visionary leaders in both government and business. But those leaders need to be guided by these principles. Whether we're talking about politics or economics, openness, transparency, freedom and fairness stand the test of time. And in the 21st century, every citizen who is now potentially connected with everyone else in the world will not sit idly by if those principles do not deliver, and if governments and business do not make good on when we'll provide long-term opportunity for all."
In closing remarks, she said, "...This agenda is good for Asia, it's good for America, it's good for business. Most importantly, it's good for people. And I absolutely believe it will help us create more a peaceful, stable, and prosperous world for the rest of this century."
You can read the Secretary's complete remarks here.