Address at the World Trade Center of New Orleans

It is my pleasure to address you on the topic of Central America after the Hurricane: A New Partnership. "Partnership" is the word that best captures the status of the relationship as it was displayed during President Clinton's historic visit to the region last month.

The last two years have seen the United States forge a closer, more mature, more productive relationship with each of the countries of the region. President Clinton has met with the Central American heads of state three times, first at the 1997 San Jose, Costa Rica Summit, again at the White House in December and now, in what truly is an historic statement of permanent U.S. interest, during a four country visit to the Central American Isthmus, which concluded with a summit meeting in Antigua, Guatemala.

I was pleased to accompany the President and can attest to the difference in our relations. The President explored ways to expand the agenda, to open up new areas of cooperation and to stand with the peoples of those countries as they embark on an enormously difficult task of rebuilding from the worst natural disaster ever in the Americas.

As President Clinton said last month in Central America, todos somos Americanos.

And if the nature of relationship has changed, the region itself has changed even more. There have been three simultaneous transitions underway in Central America- from conflict to peace; from dictatorship to democracy and from closed, narrowly-based economies to economies open to the world markets and seeking to address the underlying challenge of poverty.

Again and again, the President praised the commitment of the Central Americans to the peace process, to democratic elections and to political reforms that bring decision-making closer to the people. The President also praised Central Americans for their commitment to economic reforms that not only pay attention to sound economic principles but break down barriers to small businesses, to microentrepeneurs and to women who are indispensable to any strategy for broad-based economic growth.

The President visited the town of Posoltega in Nicaragua, the site of the greatest loss of life, which resulted from the collapse of the Las Casitas volcanic lake. The President was deeply moved, as was widely reported, by the still visible outline of the figure of a little girl buried in the landslide. He spoke with survivors, relief workers, local officials and community leaders in Honduras and Nicaragua - the two countries which suffered the bulk of the loss of life and property from Mitch. The economic costs from that devastation are estimated by the international community to reach close to $10 billion.

The power of the hurricane still is hard to appreciate. In one four-day period, over six feet of water fell on parts of Honduras. The resulting floods caused massive destruction to roads, bridges, fields, homes and schools. Few people realize that even after the worst of the storm passed, rains continued and even when Hondurans returned home from temporary shelters or replanted their fields, continued rain forced them back into shelters and washed away their initial recovery efforts. The hurricanes exacted not only an economic toll, but a physical and psychological toll as well.

I traveled to Honduras and Nicaragua with Tipper Gore and then again with First Lady Hillary Rodham Clinton and your Senator Mary Landrieu. We saw that destruction up close along with the tremendous courage and resilience of the people of that region as they sought to dig their way out of the mud and debris.

The President clearly recognized the massive task ahead.. He implored his hosts at each stop to never forget - in spite of the difficulties and suffering they have endured - from civil wars to enduring poverty to the ravages of Hurricane Mitch - the President asked them not to forget how far they had come and what they have done.

The President noted the historic changes we have witnessed in only a few short years. We have democratically elected leaders across the board. We have a growing movement to make governments more accountable to their people through the work of local government, direct elections of local officials and better-run elections. Prior to Hurricane Mitch, we had witnessed a return to positive economic growth of between 3%-5% for each Central American country. We have seen the shrinking of the military, both its absolute size and its share of the budget, which has released resources for development. And we have seen a steady march to regional integration that captures the market potential and the natural economies of scale that are needed to solve problems that no single nation can solve by itself

The regional aspect of rebuilding from Mitch was reflected in the President's announcement of the extension of the Convenio CentroAmericano con USA, or CONCAUSA, a five year $25 million environmental program that will help preserve the Mesoamerican Biological Corridor by conserving key watersheds and areas rich in biodiversity and encourage the use of clean development mechanisms to address the problems of global climate change.

The President repeatedly underscored the need to rebuild with an eye on environmental security, disaster prevention and the sustainability of any new investments. This notion of "building back better" has been a central tenet of our planning efforts in putting together the President's supplemental request for hurricane reconstruction assistance.

"Building back better" has also been the motivation of hundreds of private sector organizations and nongovernmental organizations in local communities that have made enormous contributions to the recovery effort. The Administration is also working to activate the U.S. private sector. At a December conference, hosted by USAID and the White House, seven members of the President's Cabinet and leaders of more than 400 companies met to discuss ways our government, the private sector, and American citizens can work together to assist relief and reconstruction. Today, we are matching donations of goods and services from U.S. firms - more than fifty so far - with the needs in Central America that USAID and others have identified. Offers of donations have come from such firms as Caterpillar which donated 10 power generators, General Electric, Edison International, Lucent Technologies, the Masonite Corporation, and CH2M-Hill. Cardinal Law in Boston helped identify four Bailey Bridges among the $1 million in donations that he, Governor Cellucci and Catholic Relief Services were able to pull together. And I know that New Orleans and Louisiana have been a major part of a truly amazing outpouring of generosity from the American people that now totals more than $28 million.

For our part, USAIID has played a crucial role: first, in terms of the immediate response to the emergency, joining with the U.S. military and the U.S. Department of Agriculture in supplying more than $300 million in assistance in the form of search and rescue, food aid, water, emergency medical supplies and temporary shelter. That effort ultimately involved more than 5000 U.S. military and thousands of U.S. government, Peace Corps, NGO and private sector relief workers.

Beyond emergency relief, the combined efforts of the host governments, NGOs, USAID and the U.S. military helped to restore access throughout the affected countries, through temporary repairs to roads and bridges. Key interventions include the supplying of seed, fertilizer and tools so that 10,000 Nicaraguan subsistence farmers could immediately replant lost crops. In Honduras, USAID worked closely with the Government of Honduras to restore water service to the capital and 100 small towns. Three weeks after Mitch, Tegucigalpa's water system coverage soared from zero to 75%. Today approximately 90% of the capital's population has running water, and the crews are working on permanent repairs.

In Honduras, USAID worked with local NGO partners to restore the San Isidro market by providing support to microentrepeneurs whose stalls and products were destroyed by Mitch. USAID has joined with the InterAmerican Development Bank to create a Microenterprise recovery Fund to meet the immediate and short-term needs of microenterprises throughout the region. These were key steps -- along with contributions of other donors, NGOS, the private sector and the Central Americans themselves -- that have helped the region emerge from the disaster and take the first strides toward recovery and reconstruction.

On February 16, 1999, First Lady Hillary Rodham Clinton announced that request of $956 million, which is now pending before the Congress. That request included nearly $200 million to repay accounts that were used to pay for the emergency relief effort so that we can be ready for the next disaster.

The balance of the supplemental request, some $667 million, is for reconstruction assistance for countries affected by Hurricane Mitch and the earlier Hurricane Georges which hit the Caribbean. Let me give you a few highlights of the reconstruction package:

Public Health $144 million: USAID Missions will continue to work with health ministries, the Pan-American Health Organization (PAHO) and nongovernmental organizations to help control the outbreak of infectious diseases, and to participate in intensive public health campaigns. This work must be combined with our ongoing efforts to strengthen national health care delivery systems. In addition, USADD will devote a significant proportion of these resources to restoring local access to water and sanitation facilities as a key component of containing threats to public health.

Economic Reactivation $298.3 million: This category captures a wide range of programs designed to restore and re-ignite economic growth in the countries. It includes In transportation, USAED will seek to finance local infrastructure repairs, especially rebuilding farm-to-market roads, which can create jobs that are crucial to people who have been hardest-hit by the hurricane. In agriculture, it is essential to get farmers back to work. The proposed USAID response will focus on assisting farmers, small farmers in particular, to reestablish crop and livestock production and to rebuild agricultural infrastructure. Rural credit programs will be targeted to the areas hardest hit by the hurricane, in order to ensure that farmers are able to get the seeds, fertilizers, and other elements they need for recovery.

Housing and Shelter $41 million: In the housing and shelter sector, the USG's principal role will be to assist and support national and local entities in housing finance, environmental and disaster prevention measures related to land use, creating jobs in housing construction, and establishing or expanding local building material production centers.

Schools $24.8 million: USAID will focus its efforts rehabilitation and resupply of damaged schools, including providing school supplies to over 200,000 children.

Environmental Security and Disaster Mitigation $72.3 million: Our efforts will involve the combined, coordinated efforts of several federal agencies, working with other international donors. Our program will concentrate on better watershed management throughout the region, ecosystem restoration/protection, reforestation, and soil conservation. We must seek to avoid future calamities caused by other natural disasters. In rebuilding a region already vulnerable to natural disasters, we must help it become less environmentally vulnerable than before.

Local government and accountability $12 million: Local governments will serve as an important delivery mechanism for much of our assistance. These funds will provide technical assistance to strengthen financial accounting and train local officials in disaster mitigation, planning and resource allocation. In addition, at a national level we will be working with Comptroller Generals to improve their capacity to monitor incoming resources and their proper expenditure by line Ministries.

As important as these contributions will be for the reconstruction of the region, just as important will be the manner in which the reconstruction is undertaken. For this reason, we have adopted a set of guiding principles which we have shared with the host country governments and with other donors as areas for particular attention during the planning and implementation of reconstruction activities.

First, I mentioned the notion of environmental security. We intend to stress the use of good land-use planning, environmental and geological analysis and incorporate them into planning across the different sectors. From transportation to agriculture to housing - we want to ensure that we do not build houses in floodplains; that we do not build bridges only to see them washed away during the next rainy season and that we share the lessons of successful hillside agriculture programs where we saw fields hold their top-soil during Hurricane Mitch because of this successful USAID funded practice.

Second, we want to see attention to equity issues. This means that those who were most affected by the hurricane, by and large the poor, are also the same people who have been historically marginalized in the past. We want to see that reconstruction efforts reach out to the poor, to women and to the indigenous so that opportunities reach those most in need.

Third, we will emphasize decentralization. We must work closely and cooperatively with our host governments, with local governments, and with civil society. We must remember that democracy is best constructed from the ground up, and we must encourage decision-making that is close to the people. We intend to build upon USAID's approaches in strengthening local government and decentralized delivery of services.

Finally, we want accountability. There is universal agreement, in Washington and in the region, that the greatest threat to the success of the reconstruction will be whether or not assistance is used in a transparent and accountable fashion. U.S. assistance comes with a great many safeguards, including audits and monitoring by our in-country USAID missions, but assistance now pledged to these countries, over $6.3 billion from all donors, represents a tremendous in-flow of resources. We intend to help these countries increase their own safeguards to deter, detect and deliver to justice anyone who would misuse these resources.

Finally, I want to stress that the U.S. Government response to Hurricane Mitch is a comprehensive response. Our reconstruction assistance call upon the technical assistance and expertise of over a dozen federal agencies, including the Department of Agriculture, Commerce, HUD, the U.S. Army Corps of Engineers, the U.S. Geological Survey and others. In addition to reconstruction, we are also working to provide these countries with debt relief to ease financial pressures and help Nicaragua and Honduras to spend more on reconstruction.

The President has sent to the Congress a new proposal for an enhanced Caribbean Basin Initiative that would eliminate tariffs on all textiles assembled with U.S. fabric, as well as on all textile handicrafts. It would also treat all non-textile imports from Central America exactly as we treat such imports from Mexico. The only requirement is that all nations meet their World Trade Organization obligations and participate in the effort to create a Free Trade Area of the Americas, as agreed to by all the elected leaders at the 1994 Summit of the Americas.

Finally, the President promised to do everything he could to eliminate the differences in current immigration law that treat Central Americans differently depending upon which country they come from. President Clinton understands the motivations of those who seek to better their lives and to support their families by coming north. We also must be able to control our borders and to defend against illegal immigration. President Clinton committed this Administration to seeing that this is done with justice and fairness.

Let me conclude my remarks where I began. A new partnership with Central America is underway. It involves a broad spectrum of issues beyond humanitarian relief and reconstruction. It includes the movement of people and goods, investment, culture, and tourism, the environment we share and the hemisphere we inhabit together. It is a partnership that reflects the closeness of our countries and the ties among our peoples. Somos todos Americanos.