9:40 A.M. EDT THE PRESIDENT: Thank you all very much. Mr. Ambassador, thank you very much for your distinguished years. Thank you for your service. Thank you for your kind comments. I'm honored to be here today with the Secretary of the Treasury, Paul O'Neill. Thank you for being here, Mr. Secretary. As well as our Trade Ambassador, Bob Zoellick. I appreciate the leadership that these two men have shown. Their steady advice, their standards, their adherence to principle make my job a lot easier. I also want to thank Jim Wolfensohn for not only the invitation to be here, but for your traveling long distances to get here to hear this speech. He said he landed at 6:00 a.m. this morning. Obviously, he'd never heard me give a speech before. (Laughter.) But I do appreciate his leadership. I appreciate the fact that he's raised the profile of global poverty and has underscored the importance for erasing it. I'm proud of his leadership, and I'm proud of the folks that work here at the World Bank. And I want to thank you for coming to give me a chance to speak to you. Last month in Poland, I talked about Europe and America working in partnership to build a house of freedom. A house whose doors should be open to all of Europe's emerging democracies. And a house whose windows should be open to help Europe and America see clearly their challenges and responsibilities in the rest of the world. My last trip to Europe focused mainly on opening the doors of freedom throughout Europe by enlarging NATO and the European Union. Tomorrow I will travel to Europe to meet with leaders of the world's most industrialized nations, as well as Russia, to discuss the developing world and its needs, and the developed world and our duties. The needs are many and undeniable. And they are a challenge to our conscience and to complacency. A world where some live in comfort and plenty, while half of the human race lives on less than $2 a day is neither just, nor stable. As we recognize this great need we can also recognize even greater promise. World poverty is ancient, yet the hope of real progress against poverty is new. Vast regions and nations from Chile to Thailand are escaping the bonds of poverty and oppression by embracing markets and trade and new technologies. What some call globalization is, in fact, the triumph of human liberty stretching across national borders. And it holds the promise of delivering billions of the world's citizens from disease and hunger and want. This is a great and noble prospect, that freedom can work not just in the new world or the old world, but in all the world. We have, today, the opportunity to include all the world's poor in an expanding circle of development, throughout all the Americas, all of Asia, and all of Africa. This is a great moral challenge, what Pope John Paul II called, placing the freedom of the market in the service of human freedom in its totality. Our willingness to recognize that with freedom comes great responsibility, especially for the least among us, may take the measure of the 21st century. This cause is a priority of the United States foreign policy, because we do recognize our responsibilities, and because having strong and stable nations as neighbors in the world is in our own best interests. In centuries past, strong nations often wanted weak neighbors to dominate. In our age, strong nations must recognize the benefits of successful partners around the world. Strong partners export their products, not their problems. Conquering poverty creates new customers. And a world that is more free and more prosperous is also a world much more likely to remain at peace. To build this better world, we must be guided by three great goals. First, America and her friends and allies must pursue policies to keep the peace and promote prosperity. The United States and her allies will pursue a balance of world power that favors human freedom. This requires a new strategic framework that moves beyond Cold War doctrines and addresses the threats of a new century such as cyberterrorism, weapons of mass destruction, missiles in the hands of those for whom terror and blackmail are a very way of life. These threats have the potential to destabilize freedom and progress, and we will not permit it. Prosperity depends on a stable and peaceful world. Global prosperity also depends on the world's economic powers keeping our economic houses in order. We all must pursue pro-growth policies that encourage greater productivity, reduce tax burdens, while maintaining fiscal responsibility and stable prices. Our second goal is to ignite a new era of global economic growth through a world trading system that is dramatically more open and more free. One of the most important objectives of my meetings with other G-7 leaders in Italy will be to secure their strong endorsement for a launch of a new round of global trade negotiations later this year. And at home, one of my most important legislative priorities will be to secure from Congress trade promotion authority that five other Presidents have had -- an authority necessary so that when our United States enters into agreement, the countries with whom we've agreed to will understand we mean business. It's time for Congress to act. Free trade applies the power of markets to the needs of the poor. We know that nations that open their economies to the benefits of trade are more successful in climbing out of poverty. We know that giving developing countries greater access to world markets can quickly and dramatically raise investment levels and incomes. We also know that free trade encourages the habits of liberty that sustain freedom over the long haul. That is why I applaud the World Bank's leadership in helping countries build the institutions and expertise they need to benefit from trade. Despite trade's proven track record for lifting the lives of the poor, organizers of the summit expect many people to take to the streets later this week in Italy to try to stop our progress. They seek to shut down meetings because they want to shut down free trade. I respect the right to peaceful expression, but make no mistake -- those who protest free trade are no friends of the poor. Those who protest free trade seek to deny them their best hope for escaping poverty. Legitimate concerns about labor standards, the environment, economic dislocation should be, and will be, addressed. But we must reject a protectionism that blocks the path of prosperity for developing countries. We must reject policies that would condemn them to permanent poverty. As my friend, the former President of Mexico, Ernesto Zedillo, said, the protesters seem strangely determined to save the developing world from development. Our third goal must be to work in true partnership with developing countries to remove the huge obstacles to development; to help them fight illiteracy, disease, unsustainable debt. This is compassionate conservatism at an international level. And it's the responsibility that comes with freedom and prosperity. Already, 23 of the world's poorest nations are benefitting from efforts to relieve them of the crippling burden of massive debt. These nations have committed themselves to economic reform and to channeling the savings from debt relieve into health and education. The United States has been, and will continue to be, a world leader on responsible debt relief. The developed nations must also increase our commitment to help educate people throughout the world. Literacy and learning are the foundation of democracy and development. That is why I propose the United States increase funding for our education assistance programs by nearly 20 percent. Today, I'm directing the Secretary of State and the Administrator of the Agency for International Development to develop an initiative to improve basic education and teacher training in Africa, where some countries are expected to lose 10 percent or more of their teachers to AIDS in the next five years. For its part, the World Bank and the other development banks must, as Secretary O'Neill has noted, focus on raising productivity in developing nations, especially through investments in education. Yet only about 7 percent of World Bank resources are devoted to education. Moreover, these funds are provided as loans that must be repaid, and often times aren't. Today I call on all multilateral development banks to increase the share of their funding devoted to education, and to tie support more directly to clear and measurable results. I also propose the World Bank and other development banks dramatically increase the share of their funding provided as grants rather than loans to the poorest countries. Specifically, I propose that up to 50 percent of the funds provided by the development banks to the poorest countries be provided as grants for education, health, nutrition, water supply, sanitation and other human needs, which will be a major step forward. Debt relief is really a short-term fix. The proposal today doesn't merely drop the debt, it helps stop the debt. The world also needs to begin realizing the enormous potential of biotechnology to help end hunger. The U.N. has recently reported biotechnology can dramatically improve crop yields in developing countries while using fewer pesticides and less water. We need to move forward based on sound science, to bring these benefits to the 800 million people, including 300 million children, who still suffer from hunger and malnutrition. Finally, the Genoa Summit will formally launch a new global fund to combat HIV/AIDS, malaria and tuberculosis. The United States was the first to announce our contribution to this fund, originally called for by U.N. Secretary General Kofi Annan. We are proud to have been a leader in developing the fund's structure and its focus on prevention with a broad strategy that includes treatment and care. And I'm proud that our country contributes nearly $1 billion annually to international efforts to combat AIDS and infectious diseases. I might remind folks that's more than twice the amount of the second largest donor. We stand ready to commit more to the global fund when it demonstrates success. In all these areas -- health, education, hunger and debt -- America is committed to walking alongside leaders and nations that are traveling the hard, but rewarding, path of political and economic reform: nations that are committed to rooting out cronyism and corruption, nations that are committed to building the institutions of freedom and good government. In 1950, at the height of the Cold War, John Foster Dulles issued a promise to the people of South Korea. "You're not alone," he said. "You'll never be alone so long as you continue to play worthily your part in the great design of human freedom." Fifty years since our circumstances have changed beyond recognition. The world is no longer divided into armed camps. Democracy has become a seed on the wind, taking root in many nations. So much has changed, yet America's commitment is still the same. To all nations promoting democratic government and the rule of law so that trade and aid can succeed, you're not alone. To all nations tearing down the walls of suspicion and isolation, and building ties of trade and trust, you're not alone. And to all nations who are willing to stake their future on the global progress of liberty, you will never be alone. This is my nation's pledge, a pledge I will keep. Thank you for having me. (Applause.) END 9:58 A.M. 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