Letters & Speeches
Ambassador's Remarks to the Sri Lanka Institute of Directors (SLID)
Monday, April 20, 2009; 6:00pm; On Golden Pond, Taj Samudra Hotel
Good evening. It’s an honor to address such a distinguished group of businesspeople, representing virtually all sectors of the business community in Sri Lanka. It is no understatement to say that you and the companies that you represent are the engine of Sri Lanka’s economy. Almost everyone in this country benefits from your work.
It’s been nearly 100 days since Barack Obama was inaugurated President of the United States. At the beginning of any Presidency, the 100-day mark is a symbolic, yet significant milestone. On one level, it’s an opportunity to take stock of an administration---to see what major policy actions have transpired. And, on another level it’s also the period in which a new administration defines its agenda and its policy priorities.
It’s against this backdrop that I speak to you tonight. Nearly 100-days into the Obama administration, what are its foreign policy priorities and how do those priorities affect South Asia, and -- in particular -- Sri Lanka?
If I were to give this speech during previous administrations, I might have started my talk with a different note. In the past, my country’s national interest, and consequently its foreign policy, was defined largely by our policies vis-à-vis other states---friends and foes alike, to use the old adage.
Today, it is a much different time because as the environment that defines our national interest has changed, so too have our foreign policy priorities. U.S. foreign policy is now based on global challenges and increasingly requires a global approach.
As President Obama said on his way back from the G-20 summit in London recently, “In this new century, we live in a world that has grown smaller and more interconnected than at any time in history. Threats to our nation’s security and economy can no longer be kept at bay by oceans or by borders drawn on maps…The challenges of our time threaten the peace and prosperity of every single nation, and no one nation can meet them alone.”
Tonight I want to focus on two of the biggest challenges---two threats that have transnational consequences and require a transnational response: violent extremism and the global economic crisis. No country, including Sri Lanka, is immune from these threats.
The first is violent extremism and terrorism. Certainly, violent extremism is not new. Your country has been a victim of terrorism for over 25 years, as have Spain, Ireland, and a host of other countries.
But the nature of terrorism and how countries counter and prevent threats have changed. Terrorism, like business, has become globalized. The attacks of September 11th were planned in Hamburg, Germany and funded from sources in several countries. Similarly, the recent attack in Mumbai demonstrated how violence and extremism can spread across borders.
Terrorism frequently is now transnational. The changing nature of threats has necessitated new coordinated, multinational strategies to deal with challenges. These strategies must not only be rooted in military action, but also in mitigating the factors that cause violent extremism to take root. Such factors include a lack of economic opportunity, political disenfranchisement, and the lack of democratic rights and accountability.
Defense Secretary Robert Gates outlined this approach in a recent edition of the journal Foreign Affairs. He wrote: “What is dubbed the war on terror is…a struggle between the forces of violent extremism and those of moderation. Direct military force will continue to play a role in the long-term effort against terrorists and other extremists. But over the long term, the United States cannot kill or capture its way to victory. Where possible [violent] operations should be subordinated to measures aimed at promoting better governance, economic programs that spur development, and efforts to address the grievances among the discontented, from whom the terrorists recruit.”
This broad approach to countering terrorism is what underlines our new policy in Afghanistan and Pakistan. President Obama recently announced a strategy that combines an increased international military presence in Afghanistan with increased resources for economic development, training the army and police, supporting public institutions and accountability, and assisting in the development of agricultural technologies. Yes, the immediate threats of violent extremists must be countered, but the international community must also support the ability of national and local governments in Afghanistan to provide for its citizens. As Secretary Clinton recently said, “A government that cannot deliver accountable services for its people is a terrorist’s best recruiting tool.”
The stability of Afghanistan is intrinsically tied to Pakistan. To paraphrase Secretary Clinton, violent extremism in Afghanistan cannot be countered if those who seek to destabilize the country can operate freely in sanctuaries across the border. The international community must also assist Pakistan ensure that its territory doesn’t become fertile ground for planning attacks.
I think Secretary Gates’ remarks are also very relevant for the conflict in Sri Lanka.
A lasting peace and national reconciliation in Sri Lanka---the lasting victory against violent extremism and terrorism that we all want---will not occur through military means alone. A lasting peace in Sri Lanka, and one that the U.S. could help support, will depend on creating and supporting a political process that involves Sinhalese, Tamils, Muslims and other Sri Lankans and provides minority communities the opportunities to make their own decisions over issues important to their lives in the areas where they predominate.
A lasting peace also depends on promoting better governance and rule of law, ensuring that a culture of impunity and lawlessness doesn’t take root, and increasing economic livelihoods for all Sri Lankans. This is the formula for a durable peace in Sri Lanka and for ensuring that no form of violent extremism shows its face after the LTTE is defeated militarily.
Another essential component of a lasting peace will be to find a diplomatic way to persuade the LTTE to allow freedom of movement to all civilians trapped in the safe zone in the North. The United States government issued a statement last week noting our deep concern about the current danger to civilian lives and the dire humanitarian situation created by the fighting in the safe zone north of Mullaittivu.
We called upon the government and military of Sri Lanka, and the Tamil Tigers to immediately stop hostilities, and return to a humanitarian pause. We called on the LTTE respect the right of free movement under international humanitarian law of the 150,000 civilian men, women and children trapped by the fighting.
In our view, further killing, particularly killing of civilians, will not end the conflict and will stain any eventual peace. We, the United Nations and many other countries have urged the Sri Lankan government to employ diplomacy to permit a peaceful outcome of this conflict.
Let me now turn to another major challenge that the Obama Administration is facing —the global economic crisis.
Speaking to a room full of businesspeople, I’m sure I don’t have to tell you how interconnected our economies are and how no country, including Sri Lanka, is sheltered from the current economic challenges. Similarly, no country, including the United States, can deal with the challenges alone. All countries have a role in addressing the crisis.
At the G-20 summit earlier this month, leaders demonstrated the global commitment to a coordinated approach to address the global economic downturn. Leaders agreed to restore credit, economic growth and jobs in the world economy through $1.1 trillion in pledges to the International Monetary Fund and multilateral development banks, and through support for trade and finance. They also agreed on a number of regulatory reforms.
At the summit, leaders made another important pledge: to aggressively discourage trade protectionism among countries. In times of economic trouble, there is often a temptation to enact tariffs and other barriers to protect domestic industries. History itself has taught us that protectionism only worsens an economic downturn. In the wake of the stock market crash in 1929, the U.S. succumbed to protectionist temptations and enacted tariffs and other barriers to slow down the import of foreign goods. A global trade war ensued, thus deepening and prolonging the economic crisis.
Domestically, the United States has moved aggressively tackle the downturn. Following earlier support to the financial sector, in February President Obama signed a $780 billion economic stimulus package that aims to provide short-term support to the economy while laying the groundwork for sustained economic growth. Its components include plans to boost employment; provide support for the unemployed; increase funds for environmentally-friendly technologies; and provide investments in infrastructure.
The Federal Reserve, the Treasury Department, and other U.S. Government agencies have employed a variety of instruments to ensure the financial system is solvent, that banks are strong, and that sufficient credit is available to businesses and consumers. Among the more recent actions are a program by the FED and Treasury to provide up to one trillion dollars of new lending to support car, student, and small business loans. There is also a $1.2 trillion program to buy long-term government bonds and mortgage backed securities that will make it easier for individuals to obtain mortgages and consumer loans.
As I mentioned, a global response to the economic downturn is critical. The G20 summit underscored the commitment from the leaders of the world’s largest economic powers to a coordinated approach. However, work does not lie with G20 alone. It will also be important for countries such as Sri Lanka to integrate their approaches and work together with the global community to ensure that this approach is successful. More integration, not less, is what is key.
Of course, the private sector is also key. One of the roles of government, especially in these difficult times, is to help create an environment in which businesses can grow; where growth can be catalyzed. As we all know, private companies are the largest employers; they are price sensitive, often accomplishing more with less while serving as sources of innovation. Recent history shows that the global financial sector was not adequately regulated. However, we must be careful that we do not go too far in the opposite direction and try to intervene too greatly into the affairs of private industry. Companies must be given the freedom to utilize their knowledge and best practices, allowing them to expand and increase their contributions to the overall health of the economy.
Governments must also work with the private sector as USAID and many other government agencies are doing by, for example, engaging in public-private partnership programs. In Eastern Sri Lanka, USAID is engaging in a variety of public-private partnerships to leverage and maximize our efforts. PPPs can occur in different formats, such as in-kind support, matching grants, or various other types of partnerships. I encourage all of you to visit the USAID Sri Lanka website to witness some of the great projects that have been completed and to learn about what we are planning for the future.
As you all know, Sri Lanka is facing challenges due to this economic recession. The U.S. nevertheless hopes to not only increase our trading relationship, but to also enhance it. There are many areas in which our relationship can grow. For example, your country -- and mine -- will face serious, increased power generation needs that cannot solely be met through traditional fossil fuel sources. Sri Lanka already has a good tradition of harnessing hydroelectric power. However, there is much more that can be done here -- and in my country -- to meet your countries energy needs through renewable sources. The U.S., as a world leader in technology, can help your companies and your country meet those needs through technologies that are present now, but also in coming years through new technologies that are currently being developed to help build a globally green and sustainable recovery.
I want to end my remarks on a positive note before I turn the floor over to you for your questions. Yes, we are faced with unprecedented global challenges. I have talked about two tonight: violent extremism and the global economic crisis. Of course, there are others: resolving the situation in northern Sri Lanka with no further loss of life, global warming, nuclear proliferation, drug trafficking, and human trafficking just to name a few. Each of these issues affects us all, no matter if we live in Colombo or in Cleveland. But the positive aspect is that globalization has created far more opportunities than it has challenges. Thanks to globalization, we have the unprecedented potential to work together to develop new technologies, to coordinate responses to economic challenges, and to work together, diplomatically, to address threats.
Thank you and I look forward to your questions and comments.