We have arrived at a moment in history where the ability of countries to deliver on the promise of democracy and development for its citizens is critical.

There is increasing concern that we are not getting the hoped for and expected levels of trade-driven development in the region. Over 220 million individuals in this Hemisphere still live in abject poverty.

This is the reality despite trade agreements with the largest economy in the world including the recent US-Colombia, US-Peru, DR-CAFTA, as well as older US-Chile and NAFTA agreements.

In other words, trade agreements are not delivering enough development. More generally, democracy is not delivering enough development. It might be said that even development strategies are not delivering enough in terms of creating opportunity, equity and prosperity.

To paraphrase a recent UNDP report, global trade must be made to “work for people.” This is a challenge that must be addressed.

At the OAS, we are in the process of reengineering our strategic agenda in a manner that will emphasize the nexus between democracy and human rights, integral development and multidimensional security. Economic integration and trade liberalization hold great promise for the nations and peoples of this Hemisphere. However, we are fully aware that development that focuses only on the economic is by definition deficient. Growth without distribution, that benefits only the few, is not sustainable, and will ultimately undermine democracy and governability.

The Changing Landscape

Over the past two decades, the world has changed fundamentally and dramatically:
• Old paradigms no longer apply;
• Traditional centers of power are shifting;
• State-to-state relationships are evolving in unexpected ways;
• Trading systems are being transformed;
• National borders are increasingly porous;
• National and global security are inextricably linked; and
• Technology has democratized access to information and upended traditional notions of competitiveness and productivity.

Indeed, we live in a world of uncertainty and insecurity in which change is the only constant.

In the 34 Member States of the OAS, we see an ongoing process of change as countries go through processes of political evolution and economic transformation. We see change as civil society in many countries feels more empowered to actively participate in public discourse. We see change as long marginalized groups including indigenous communities, youth, and women have assumed more prominent roles, challenged traditional notions of leadership and brought attention to a range of new human development and capacity building issues. And, we see change as governments and the private sector begin to establish more concrete mechanisms for an ongoing process of collaboration in the trade and development agendas.

At one level therefore, we see strengthened dialogue and the democratization of public participation in the national and hemispheric agendas. This has significant impact on the political process both in terms of the functioning of parliaments and democratic governability as empowered citizens pay increased attention to policy decisions and demand more accountability and transparency from elected leaders.

Governance

Although democracy has been established throughout the Americas, we are all aware that countries have not always been successful in delivering the promised fruits of democracy and economic reform. This failure threatens countries’ social and political fabrics, and creates unstable environments that undermine the ability of governments to govern. Recent surveys in Latin America reveal almost one half of the population expressed disappointment in their young democracies and do not experience the link between democracy, stability and development in real terms in their daily lives.

High unemployment remains persistent in several countries, poverty levels are on the rise in both rural and urban areas, crime (including gang violence and illegal arms trafficking) is increasing, and pockets of social and political unrest are emerging. On top of these challenges, many countries, especially the vulnerable economies in the Caribbean and Central America, annually face the threat of hurricanes, floods, and other natural disasters that can devastate the economy and place a burden on recovery and reconstruction for years.

The results of democratic weaknesses, economic crises and social unrest will ultimately result in problems for all, as many of our challenges and problems are inter-related and internationalized. For example:

• Areas of conflict between and within OAS member states persist even as there is a strengthening and deepening of relations;
• Political and social unrest in one country threatens the stability of neighboring countries, bringing regional security to the fore as a critical challenge and objective;
• Environmental degradation in one country harms the ecosystem in others; and
• Corruption, crime and health crises, among other problems, challenge the very social fabric of societies, and inhibit economic growth and investment in countries.

In the face of all these challenges, there are positive signs that traditional barriers of language and distance are giving way to greater contact and cooperation among countries and peoples in the Americas. I firmly believe that political, economic and social development in a country is not solely the responsibility of governments. All members of civil society including individual citizens, religious organizations, media, academia, the business community, trade unions and political leaders have the responsibility and obligation to contribute to democracy, development, security and peace.

The Relationship between Democracy and Development

In a 2006 survey of voters in Latin America, the six most urgent problems that voters listed were:
1. Unemployment;
2. Corruption;
3. Poverty;
4. A Crisis of Values;
5. Education; and
6. Public safety.

Place these concerns in the context of the 2006 electoral map – which covers all the major sub-regions in the Americas – and one can see that the political dynamics at work this election year may well have significant implications for the Hemisphere.

There will be at least 12 presidential/prime ministerial elections in the Western Hemisphere this year. Already this year, we have seen elections and changes in leadership in Canada, Costa Rica and Haiti. Elections are also expected in eight other countries – Peru, Colombia, Mexico, Guyana, Venezuela, Ecuador, Brazil, and Nicaragua.

The total population of countries that will select leaders at the polls this year is over 453,000,000. In other words, over 50% of the population of the Americas will be under new or renewed leadership by the end of 2006.

With the exception of Canada, the average per capita income of these countries is $6,500 – lower than the top 100 countries and in a region with the worst income distribution in the world. The concentration of wealth in certain sectors and in larger cities leaves significant numbers of people outside of the modern economy, with little access to social services, infrastructure and credit to move up the economic ladder.

For the largest countries, Brazil and Mexico, their 2005 estimated GDP 2005 growth rates are 2.6% and 3%, respectively, while the world average is 4.3%. Even in the countries with higher growth rates, this is generally the result of emerging from years of economic crisis and/or the result of exporting raw materials – both of which have a limited impact on employment generation.

In sum, most economies in Latin America and the Caribbean are not growing fast enough or creating enough jobs and income to address the real concerns of economic opportunity and quality public services the citizens’ demand.

Many analysts agree that the region has had disappointing levels of sustainable development. The reasons given for this vary across the political spectrum but most studies hold that the stable democracies with reliable public sector management and the rule of law provide a better environment for citizens as well as a higher quality business environment.

The Role of the OAS

What is the OAS doing about this dilemma?

For me, it is particularly important to preserve the political and institutional integrity of the OAS. We must remain consistent in political resolve and action, in improving institutional efficiency, and in facilitating the development goals of the democratic community of nations in the Americas.

Without a doubt, the OAS provides a unique platform for consensus building and political dialogue. It is still the forum of choice when countries of the Hemisphere confront political challenges that threaten national unity and regional stability.

But even as the OAS strengthens its capacity to respond in a timely manner to the pressing concerns of Member States, we are aware that even more can be accomplished through strategic partnerships.

As an example: I just left, and will shortly return to, a meeting with heads of regional and sub-regional organizations. The OAS convened this meeting because we have recognized the importance of sharing information and resources, and working together to maximize outreach and impact.

In that vein, we have identified IICA as an important partner in pursuing objectives of poverty reduction, employment generation and the development of agro-tourism and bio-energy. CCAA, the Inter-American Council and others represented here today can also become key partners in helping us to advance a comprehensive trade and development agenda.

I believe that we need to simultaneously address political and developmental priorities, and to focus on promoting a mutually enforcing agenda. We need to provide consistent, stable, enforced and transparent rules for the private sector to invest and generate productive employment. We need a healthy and well-educated work force that can live in peace and achieve prosperity. We need a social safely net to care for the neediest in our societies to fulfill our commitment to community. To achieve these goals requires functioning political and policy institutions that can translate the values and requirements of the population into the reality of everyday life.

The OAS is tackling this challenge in several ways, including:

• focusing efforts on strengthening democracy through education and support for the electoral process;
• maintaining a strong commitment to the protection of human rights;
• pursuing a security agenda which reflects a modern understanding of the profound impacts of regional conflict; terrorism; illegal drugs, firearms, and human trafficking; and natural disasters;
• promoting development policies that include the participation of vulnerable groups and that promote environmental stewardship; and
• working more closely with the private sector and organizations such as CCAA and IICA in the formulation and execution of an effective development agenda.

We have a strong commitment to supporting quality elections in the region. Just in the last year alone, the OAS has played a critical role in helping to maintain stability and safeguard the rule of law in several countries.

As election season nears in a dozen countries this year, the OAS is prepared to respond to invitations from member states to support the electoral process through electoral observer missions and technical support. In my experience, it is important to gain public trust by ensuring that elections are conducted in a manner that is considered free and fair, and in which eligible citizens have the right and the ability to exercise their right to vote.

Unfortunately, these elements are not consistently present in our Hemisphere. In implementing the Inter-American Democratic Charter, the OAS is committed to helping to build essential institutions that will ensure elections are truly democratic and are also perceived as such. We have also provided training in many countries to strengthen the functioning of legislative bodies. In this regard, I must congratulate the people of Costa Rica. The last several weeks have provided evidence that institutions do work in maintaining stability and governability even when the outcome of an election is uncertain.

Although the notion of democracy, and what it encompasses, has evolved significantly over the past few decades, the indispensable nature of holding free and fair elections remains undisputed. The alternative – that is, not having elections – is generally counterproductive, costly and damaging, creating greater insecurity and instability.

Conclusion

The challenge of guaranteeing socio-economic development and democracy in the Hemisphere is to a large extent dependent on a commitment to security that responds to the rule of law, collective will and common responsibility. The Inter-American System is a fundamental pillar of this vision, as it encompasses and sustains the hemispheric architecture of the preservation and consolidation of democracy, the rule of law, human rights, collective security and socio-economic development, which are all deeply intertwined and mutually dependent.

Many states in the Hemisphere require assistance with institutional reforms to help ensure the primacy of the rule of law and the democratic framework within which freedom and socio-economic development can flourish.

No government or organization has a magic bullet or a quick and easy answer to the challenge of improving democracy and delivering the development gains that citizens expect. Also, no government can address all these challenges effectively in isolation. I believe that an integrated approach which brings together the resources, capacities and convening powers of governments and hemispheric organizations; reaches out to the private sector as full partners in development; and welcomes the input of civil society is essential. Through broad-based dialogue and collective action, we can make an impact in the daily lives of all the citizens of the Americas.

Finally, let me close by bringing your attention back to the central issue of change. Three days ago, a new President was inaugurated in Chile. The ruling party in Jamaica recently elected a new party leader who will take over the reins of government when Prime Minister P.J. Patterson demits office in a few weeks. For the first time in history, both Chile and Jamaica will have female heads of government. I congratulate President Michelle Bachelet and Prime Minister Designate Portia Simpson Miller on attaining the highest elected office in their respective countries. It is a significant step forward and a positive development for democratic governance when citizens vote their interests, priorities and concerns, regardless of gender.

I believe that creating a political space that is more inclusive of all groups in society is essential for moving forward a comprehensive socio-economic and development agenda.

Economic growth is indeed fundamental but it is not sufficient to ensure poverty eradication, social cohesion and development. 1/ Ultimately, all of us have a collective responsibility in helping to build and maintain environments that support domestic and hemispheric objectives of peace and security, justice, social equity, development, and governability. This is our challenge and our responsibility to provide hope and opportunity for all the citizens of the Americas.

Thank you.

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1. This issue is addressed AG/RES. 1512 (XXVII-O/97), Declaration of the Ministers and Heads of Delegation meeting in Washington DC to determine the social development policies of the Organization of American States.