Remarks by the President at Opening of the CEO Summit of the Americas

Hotel RIU
Panama City, Panama

3:05 P.M. EST

PRESIDENT OBAMA:  Well, thank you, Luis.  First of all, let me not only thank you but thank our host and the people of Panama, who have done an extraordinary job organizing this summit. 

It is a great pleasure to be joined by leaders who I think have done extraordinary work in their own countries.  And I've had the opportunity to work with President Rousseff and Peña Nieto on a whole host of regional, international, and bilateral issues, and very much appreciate their leadership.  And clearly, President Varela is doing an outstanding job here in Panama as well.

A lot of important points have already been made.  Let me just say this.  When I came into office, in 2009, obviously we were all facing an enormous economic challenge globally.  Since that time, both exports from the United States to Latin America and imports from Latin America to the United States have gone up over 50 percent.  And it's an indication not only of the recovery that was initiated -- in part by important policies that were taken and steps that were taken in each of the countries in coordination through mechanisms like the G20 -- but also the continuing integration that’s going to be taking place in this hemisphere as part of a global process of integration.

And I'll just point out some trends that I think are inevitable.  One has already been mentioned -- that global commerce, because of technology, because of logistics, it is erasing the boundaries by which we think about businesses not just for large companies, but also for small and medium-sized companies as well.  That's point number one.

Point number two is that technology is going to continue to be disruptive.  I'm glad that my friend, Mark Zuckerberg, is here.  Obviously what he’s done with Facebook has been transformative.  But what’s important to recognize is, is that it's not just companies like Apple and Google and Facebook that are being transformed by technology.  Traditional industries are being changed as well.  Small businesses are being changed as well.  How we buy, sell, market, all that is shifting.  And that's not going to go away.

And what that means is, is that going forward, for the hemisphere to continue to experience the growth that's necessary, I think there are a couple of principles that we just have to follow.  And some of them have already been mentioned, so I'll just speak to them very quickly.

The first is, our people have to be the best trained in the world.  We have to not only educate our children, but we have to give our people the capacity to continue to learn throughout their lives -- because the economy is changing and workers have to adapt.  It's going to be very rare where somebody works at one place for 30 years with just one skill.  So the investments that all of us have to make in education, not just through primary or secondary schools, but if young people are not going to universities, they can still at least get technical training and advanced degrees.

And this is where technology can be our friend.  We initiated something called 100,000 Strong to improve the exchanges between students in Latin America and the United States.  And part of what we're doing is starting to figure out how can we use technology to reach more young people, not just the folks who are at the top of the economic pyramid, but reach down and access remote areas where suddenly a young person in a small village, if they are linked through the Internet, have access to the entire world.  And companies I think can play an important role because public-private partnerships will make these kinds of investments more effective.

Point number two -- the issue of infrastructure has already been mentioned.  We have a lot of infrastructure we need to build in the United States and obviously there’s a lot of infrastructure that needs to be built throughout the region.  The more we can coordinate and work together on infrastructure, the better off we're going to be.

Just one example:  I came from SICA, the meeting of Central American leaders.  Their energy costs are typically three times higher than what we pay in the United States.  It's a huge impediment to their development.  To the extent that we can create a single regional energy market, then the costs of production, of transmission, distribution of energy becomes cheaper for all the countries involved, and you get certain economies of scale.  And so part of what a Summit of the Americas can accomplish is to try to work on a regional basis around some key infrastructure projects that will help us all grow.

Number three, as has already been mentioned, the issue of broad-based economic development.  I was very interested in speaking with President Varela about Panama.  They’re seeing outstanding growth, and yet there are still some remote areas where I know the President has a priority.  How do I reach those communities that are isolated, that are not part of that growth process -- all of us have to deal with that. 

And that includes in the United States, by the way.  Because one of the challenges that we're all facing, when you look at global growth patterns, is that even when economies are growing, the gaps between rich and poor oftentimes are accelerating, and not only is that not good for social stability, not only is that not good for opportunity, it's not good for business.  Because the truth of the matter is, is that when you have a growing middle class and an aspirational poor that are able to access their way into the middle class, then those become the consumers that drive the marketplace much more so than folks at the very top.

There’s only so much food you can eat.  There’s only so many cars you can buy.  And at a certain point, if only folks at the top are doing well, and we're not focused on broad-based growth, then growth starts to stall.  And so taking the steps to train, to educate, to give access to opportunity, to make sure that infrastructure is reaching everyplace and not just some places -- that becomes a very high priority.

And the last point I'll make is the issue of governance.  President Varela mentioned the issue of violence, and this is obviously something that is of deep concern in many parts of the world, and sadly, is still a problem in portions of the hemisphere.  And a lot of it has to do with lack of opportunity. But part of it also has to do with the difficulties of establishing strong security if we also are not combining that with transparency, with government accountability, with a criminal justice system and a judicial system that is perceived as fair and legitimate. 

And so the work that we’ve begun to do together -- for example, Brazil and the United States and Mexico, we’re working on an Open Government Partnership that makes sure that records are available, and people understand how their government is spending their money, how contracts are let, reinforcing norms around rule of law.  Not only does that give us more tools to combat violence, but it also, I suspect, makes investors a lot more interested in investing in a country, if they know what the rules are and they have certainty, and political risk is reduced.

And again, this is an area where we have to work regionally as opposed to separately.  Because the narco-traffickers don’t distinguish between borders.  Well, that means we can’t either.  And fortunately, we have some outstanding partners who’ve been working together.  Panama is one of our best partners.  President Peña Nieto has been doing outstanding work with us and seeing how we can coordinate more effectively.  But issues of personal security, reducing corruption, governance -- those are economic agendas.  Those are not simply security agendas.  (Applause.) 

END
3:15 P.M. EST