The White House, President George W. Bush Click to print this document

VI. Ignite a New Era of Global Economic Growth through Free Markets and Free Trade

"When nations close their markets and opportunity is hoarded by a privileged few, no amount-no amount-of development aid is ever enough. When nations respect their people, open markets, invest in better health and education, every dollar of aid, every dollar of trade revenue and domestic capital is used more effectively."

President Bush
Monterrey, Mexico
March 22, 2002

A strong world economy enhances our national security by advancing prosperity and freedom in the rest of the world. Economic growth supported by free trade and free markets creates new jobs and higher incomes. It allows people to lift their lives out of poverty, spurs economic and legal reform, and the fight against corruption, and it reinforces the habits of liberty.

We will promote economic growth and economic freedom beyond America’s shores. All governments are responsible for creating their own economic policies and responding to their own economic challenges.We will use our economic engagement with other countries to underscore the benefits of policies that generate higher productivity and sustained economic growth, including:

The lessons of history are clear: market economies, not command-and-control economies with the heavy hand of government, are the best way to promote prosperity and reduce poverty. Policies that further strengthen market incentives and market institutions are relevant for all economies—industrialized countries, emerging markets, and the developing world.

A return to strong economic growth in Europe and Japan is vital to U.S. national security interests. We want our allies to have strong economies for their own sake, for the sake of the global economy, and for the sake of global security. European efforts to remove structural barriers in their economies are particularly important in this regard, as are Japan’s efforts to end deflation and address the problems of non-performing loans in the Japanese banking system.We will continue to use our regular consultations with Japan and our European partners—including through the Group of Seven (G-7)—to discuss policies they are adopting to promote growth in their economies and support higher global economic growth.

Improving stability in emerging markets is also key to global economic growth. International flows of investment capital are needed to expand the productive potential of these economies. These flows allow emerging markets and developing countries to make the investments that raise living standards and reduce poverty. Our long-term objective should be a world in which all countries have investment-grade credit ratings that allow them access to international capital markets and to invest in their future.

We are committed to policies that will help emerging markets achieve access to larger capital flows at lower cost. To this end, we will continue to pursue reforms aimed at reducing uncertainty in financial markets.We will work actively with other countries, the International Monetary Fund (IMF), and the private sector to implement the G-7 Action Plan negotiated earlier this year for preventing financial crises and more effectively resolving them when they occur.

The best way to deal with financial crises is to prevent them from occurring, and we have encouraged the IMF to improve its efforts doing so.We will continue to work with the IMF to streamline the policy conditions for its lending and to focus its lending strategy on achieving economic growth through sound fiscal and monetary policy, exchange rate policy, and financial sector policy.

The concept of "free trade" arose as a moral principle even before it became a pillar of economics. If you can make something that others value, you should be able to sell it to them. If others make something that you value, you should be able to buy it. This is real freedom, the freedom for a person—or a nation—to make a living. To promote free trade, the Unites States has developed a comprehensive strategy:

Economic growth should be accompanied by global efforts to stabilize greenhouse gas concentrations associated with this growth, containing them at a level that prevents dangerous human interference with the global climate. Our overall objective is to reduce America’s greenhouse gas emissions relative to the size of our economy, cutting such emissions per unit of economic activity by 18 percent over the next 10 years, by the year 2012. Our strategies for attaining this goal will be to:

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