The President's News Conference With President Felipe de Jesus Calderon Hinojosa of Mexico and Prime Minister Stephen Harper of Canada in New Orleans

President Bush. Thank you all. Mr. President, Mr. Prime Minister, welcome to the great city of New Orleans. Thank you all for coming as well. New Orleans is one of America's really top cities. And they, the people of New Orleans, appreciate the help you gave them right after Hurricane Katrina, and so I want to thank you very much for that. New Orleans has always been a crossroads for our continent. And today, there's no better place for our nations to look forward to a bright future, and that's what we're here to do.

I—one of the things our—you know, people ask, well, does it make sense for Mexico, Canada, and the United States to meet? Absolutely, it makes sense. We're neighbors. A prosperous neighborhood is in our interests; a secure neighborhood is in our interests. And we share common values. So I'm not surprised we've had good meetings. Plus, we like each other. It's easy to work with leaders who are straightforward and honest, tell you what's on their mind, and who care deeply about the people of their countries and who are problem-solvers. And that's how I have found this meeting and the previous meetings we've held.

We talked about trade. Mexico, Canada, and the United States made a bold decision in the early 1990s. Our countries decided to reduce our trade barriers through the North American Free Trade Agreement. That was a visionary move by previous leaders, a move that has benefited all three of our countries a lot. Trade has tripled. Our economies have grown by more than 50 percent.

Now is not the time to renegotiate NAFTA or walk away from NAFTA. Now is the time to make it work better for all our people. And now is the time to reduce trade barriers worldwide.

And so we spent time talking about the Colombia free trade agreement. Canada is negotiating a Colombia free trade agreement. Mexico has a free trade agreement with Colombia. And a lot of folks are waiting for the United States Congress to bring this issue up and pass it. It makes no sense to me to say that Colombia goods can come into our country duty free, yet our goods can't go into Colombia duty free. And yet that's the case.

An agreement with Colombia would level the playing field, and a failure to pass an agreement would send a terrible signal to our neighborhood. The Speaker of the United States Congress has killed this bill unless she gives us a date certain for a vote. It is a bad decision on her part, and it's bad for our hemisphere to have the United States of America turn its back on a mutual friend like Colombia.

We're working to make sure we reduce regulations and to add—to make sure that our small businesses and farmers and producers are able to move product in a way without a bunch of government regulations in between. And it's not easy work, because obviously we want to maintain high standards and work for good safety precautions. Yet we're making progress.

And we've charged others to continue to work; like, Carlos Gutierrez and my Cabinet will work on issues with his counterparts for more harmonized standards to reduce the cost of producing cars and trucks throughout our entire market. In other words, you've got different regulations in different countries that make it difficult to compete globally and cause our products to be more expensive than they should be.

We're talking about food and product safety standards to make them compatible in a way that guarantees safety for our consumers. We talked about the need for us to work together to promote clean, efficient, low-carbon energy technologies. Obviously, we talked about global warming and the need to make sure that major economies are all party to an agreement.

People say, well, are you really committed to global—to reducing global warming? Absolutely. As a matter of fact, I gave a speech in the Rose Garden the other day that made it abundantly clear the United States is for an effective climate agreement that includes binding commitments from all major developed and developing economies, and we'll continue to work toward that end.

And then obviously, we're still working to make sure our borders work well. I mean, there's complications on these long borders. I understand that. We're making progress addressing problems and, at the same time, making sure that our people are safe.

For example, we've had an issue with Mexico. The last time—the time before last we met, the President made it abundantly clear that he felt the United States ought to do more to prevent guns from going into the—from the United States into Mexico. I couldn't agree more with him. And we put a process in place that do a variety of things, all aiming to make sure that our neighbors and our neighborhood isn't scourged by these thugs who use guns out of the United States to hold their people hostage, hold the country hostage. And so we've got a lot of tough work to do, but we're doing it.

And finally, in terms of just bilateral relations with Mexico, the Merida project is an important project to help implement a dual strategy to deal with crime and drugs. The President and I have talked about this initiative in a way that benefits the people of Mexico and the United States. The initiative conclude—includes a commitment this year of $550 million by the United States. And Congress needs to pass the deal—pass the bill. And they need to pass it in such a way that it conforms to the strategy that the President of Mexico thinks will best help deal with this issue.

All in all, it's been a very—it's been a good summit. And I appreciate you all coming. New Orleans is a fun town. I'm looking at the press corps to make sure that they didn't take advantage of it. [Laughter] You look well rested.

Anyway, it's a great place. I'm glad you're here. Thanks for coming.

Mr. President.

President Calderon Hinojosa. Thank you, Mr. President. Thank you, President Bush, my friends from the media, from the press, Prime Minister Harper. First of all, I'd like to thank you, Mr. President. I'd like to thank President Bush and the people of the United States for your hospitality. I think that the city of New Orleans has been an ideal venue for this leaders' summit.

And I'd like to say that I congratulate the people of Louisiana for their determination, for their strength. I congratulate the people of the United States, as well, for the recovery they've shown after the effects of Hurricane Katrina. And I repeat that Americans can always count on the solidarity of Mexicans during times of tragedy as a result of, in this case, a natural phenomenon.

I'm pleased because the meeting allowed President Bush, Prime Minister Harper, and myself to work on an agenda that was devoted to improving the welfare of our peoples. President Bush already mentioned some of the issues we talked about. I would simply underscore the following.

First, we reasserted commitments we adopted in Montebello last year, such as that of strengthening the competitiveness of our region, cooperation in the area of imports, products from other areas of North America, food security, and also improving the situation of all the regulation among our three countries. And our Secretary will be spearheading the work on the Mexican side in order to deregulate measures affecting trade.

Second, we talked a lot about the NAFTA, and of course, we agreed that this is not the time to even think about amending it or canceling it. This is the time to strengthen and reinvigorate this free trade agreement among our three countries. Thanks to the free trade agreement, trade exchange went beyond $900 trillion, behind which we have jobs; we have investment; we have goods and services that improve the quality of life of Canadians, Americans, and Mexicans. And we want these benefits to reach more and more of all our citizens.

Third, we agreed on the need to strengthen investments and cooperation among all our nations. And the business leaders of the three countries gave us a very specific agenda that records the progress we've made and also establishes how much more quickly we need to work within the North American Competitiveness Council, where the three leaders agreed we fully need to support the work of this Competitiveness Council.

Fourth, we recognized the progress made within the regulatory framework that's compatible for all three countries.

Fifth, we agreed that the efforts we've made in the area of intellectual property have transferred to major hits against smuggling and the work of pirates. In the case of Mexico, for example, last year, we carried out the biggest seizures in the history of our country. And in fact, last night we had some major efforts carried out against organized crime. And the three countries will continue to work on improving the conditions of law enforcement.

Six, we also talked a lot about border projects. Our three countries want to have safe borders, and we want to have efficient borders, borders that will improve the competitiveness of our various businesses and for the entire region. We talked about how to make the flow along the borders even better, how to improve trade there.

Of course, there are issues of interest between Canada and the United States. They're working on those issues. In the case of Mexico, we are working very hard on how to expand the border crossings between Mexico and the United States with projects that are already in course: ones in Reynosa, others in Juarez and different points across the border.

We also exchanged viewpoints on the issues that have to do with security in the region. And in this case, we talked to President Bush about the Merida Initiative, an initiative that is focused on facing a joint strategy with regard to a joint—a common enemy, which is organized crime, which operates on both sides of the border and which does not recognize any borders, any limits. And unfortunately, it affects Mexican, Canadian, and U.S. families.

It's very important for our Congresses and Parliaments in our respective countries to strengthen, support the decisive actions that we are carrying out in order to eradicate this scourge that is affecting all of North America.

We also stressed the need to continue to promote growth and development in our entire region. Throughout the continent, and especially in Mexico, we're concerned about Latin America. That's why it's important for this cooperative and collaborative mechanism among the United States, Canada, and Mexico to work. And that's why we also need to redouble the successful cases where trade and cooperation are fruitful and lead to tangible results for our people.

I want to talk about the efforts being made in this country to establish free trade agreements that are much more practical and beneficial for everyone, in particular, the one under discussion now in the U.S. Congress between the United States and Colombia. It's extremely important, I think, to bear in mind that when you provide more opportunities for trade in the Latin American region, there will be many more opportunities for prosperity. And it needs to be made very clear that the prosperity of Latin America, and particularly that of Mexico, is a crucial factor for the prosperity of the people of North America.

Finally, ladies and gentlemen, I'm convinced, and after this meeting even more so, that after 14 years of a very decisive step, which was the North American Free Trade Agreement, today, the relations between the United States, Canada, and Mexico is more dynamic, more fluid, much more successful than ever before.

In particular, I want to thank President Bush for his leadership in holding not just this meeting here in the United States but the fact that these meetings were established in the year 2005. And President Bush's leadership has been very important for these meetings to be held among the three countries, which don't just affect the leaders attending the meetings themselves but allow all of us to coordinate our policies, our activities, and our objectives in order to ensure greater regional prosperity.

This is the last meeting for President Bush. From now on, the veteran for these meetings is going to be Prime Minister Harper. And I'm sure that whoever the next President of the United States will be, he or she will continue with this regional effort. Independently of the fact that, unfortunately, President Bush will not be with us, we have at least informally invited him to our next meeting personally.

And I'd like to announce formally, on behalf of the Mexican Government, that we have conveyed to the Governments of the United States and Canada a very special invitation to take part at the next leaders' summit of 2009 to be held in Mexico. And of course, from now on, we will be preparing to make sure the summit is memorable and productive, a summit that will offer the taste of the hospitality of the people of Mexico and will also allow us to reach various specific decisions on a number of issues which, as we have shown at this meeting, have been very carefully analyzed. And the options for the North American Competitiveness Council and the three administrations is very clear.

I hope that we will continue have an even more prosperous North American region, a region where the United States, Canada, and Mexico will gain in competitiveness vis-a-vis other regions of the world which are now leading in terms of growth and productivity. But I'm sure that we can achieve this, especially if we persevere with the good will that has been demonstrated at this New Orleans meeting.

Thank you so much, Mr. President, and thank you to the American people.

Prime Minister Harper. This is the last— we talked about common stakes for our three countries. President Bush, myself, and—we have discussed about commerce and the advantages that NAFTA brings to our three countries and has been doing for 14 years. We talked about the progress that we've made, and we have talked about not only what has been done, but also what needs to be done.

We concluded that it's essential for the prosperity of our countries to continue this effort. And we have emphasized in particular the border crossing, Windsor-Detroit. It is evident that a greater North American cooperation will lead to the creation of jobs and will allow us to compete in a very effective way to other emerging commercial blocs around the world.

I would like—also talked about our concern about the thickening of the border between our countries. The Chambers of Commerce of the United States and Canada are concerned about these border issues for several years. And the council for competitiveness has also talked about their concern about this border issues.

It was a great pleasure to come to New Orleans for this summit. And of course, I want to thank President Bush and the population of New Orleans for their great hospitality. And I'm looking forward to see President Calderon, who will greet us in Mexico and welcome us to Mexico next year.

[At this point, Prime Minister Harper continued in English.]

President Bush, President Calderon, and I have discussed the common issues and challenges facing our three countries. We discussed the importance of cooperation on security and trade and the benefits that NAFTA has produced for each of our three countries over the last 14 years.

We also talked about the progress we've made and are continuing to make to improve North American security. We agreed that continuing to improve and expand trade is the key to greater prosperity for our peoples, and we are putting special emphasis on the Detroit-Windsor crossing.

It's clear that greater North American cooperation is our best option to create jobs and to compete effectively with emerging trading blocs elsewhere in the world. To that end, I specifically raised concerns about the so-called thickening of the Can-ada-U.S. border. The Canadian and American Chambers of Commerce have been worried about this for several years, and the North American Competitiveness Council raised their concerns at our meeting this morning.

It has been a pleasure to come to New Orleans for this summit. I—my only regret, Mr. President, is that I didn't bring my wife and decide to spend a lot more time here. But it's been wonderful to visit here, to see the rebuilding. I won't say my farewells, because you and I have a few more meetings, including the G-8 this summer, that we're looking forward to.

I also look forward to seeing you, President Calderon, in the future—and for your offer to host us next year. And I can tell you, Canadians are always delighted to visit Mexico in the wintertime, so keep that in mind. [Laughter]

President Calderon Hinojosa. Thank you.

President Bush. Okay, a couple of questions.

Trade/2008 Presidential Election/MexicoCanada-U.S. Relations

Q. Thank you, Mr. President. I want to follow up on your comments about NAFTA. The Democratic Presidential candidates, in fact, are talking about renegotiating that trade agreement if elected. I'm wondering if you're worried that their comments on the campaign trail are perhaps overshadowing your protrade agenda. In essence, do you worry that you're losing the free trade debate in the courts of public opinion?

And to President Calderon and Prime Minister Harper, I'd like to get your thoughts about expanding your trade relationship with the United States. Is there a point at which you shift attention to the people running for the White House and their views and try to reach out to them?

President Bush. Actually, my biggest concern on trade right now is with Colombia. NAFTA exists, and NAFTA—when you analyze it in an objective way, it benefits— beneficial to America. It also happens to be beneficial to Mexico and Canada, which makes it a, you know, a very good, comprehensive agreement.

It's beneficial to us because when you're able to export to your neighborhood, it helps create jobs. Jobs are created when people find outlets for their goods and services. We have found a lot of outlets for our goods and services with our—in our neighborhood. It also helps consumers when you import. In other words, the more choices consumers have, the more options they have, the more—less likely it is there will be price increases, and it's better for your consumers. This agreement's been beneficial in creating wealth in our neighborhood. Our economies have all grown.

I also happen to think it's very important for our citizens. I wish people could remember what the border looked like between Texas and Mexico before NAFTA. I mean, it was poor, really poor, on both sides of the border. If you go down there today, there's prosperity on both sides of the border, and that's in our Nation's interests.

I mean, one way to increase pressure on the border is to—if you do it—away with NAFTA, there's going to be a lot of Mexicans—more Mexicans out of work. It will make it harder on the border. It will make it harder to deal with. So people who say, "Let's get rid of NAFTA," because of a throwaway political line, must understand this has been good for America, and it's also been good for Mexico and Canada, and that's what you want in your neighborhood.

Secondly, my biggest concern is to turn our back on our friends in Colombia. The Speaker of the House made a decision, using an extraordinary procedure, to prevent a vote on a trade bill that had been negotiated in good faith between our respective countries. You heard the—President Calderon say, it's in the region's interest to trade freely and fairly. Well, this agreement we have with Colombia right now is not fair for America, it's not fair for our businesses, it's not fair for our farmers. And all I'm asking the Congress is to make it fair.

And if they—if the Speaker doesn't bring—give us a date certain on the bill, she's effectively killed it. It's her responsibility, and she's going to have to explain why the voices of false populism have been strengthened, why anti-Americanism could flourish, when America turns its back on a strong leader like President Uribe and a friend for democracy like President Uribe.

I'm concerned about protectionism in America. It's not in our interests to become a protectionist nation. And so I'll continue to speak out on it and assure our friends that we will work hard to explain to the people the benefits of why free and fair trade is in our Nation's interest.

President Calderon Hinojosa. First of all, what we have to do—all of us who have responsibilities vis-a-vis our citizens—is to objectively study the facts. What's happened with NAFTA in our three countries? Before NAFTA, there were many businesses, Mexican businesses, that were afraid, and they alleged that it was impossible to compete with the sophisticated and modern U.S. companies. And they weren't going to survive. There were also many U.S. companies who thought it was impossible to compete in more open markets. Now, what was the result? The result has been that trade has grown, and that has led to gains for everyone involved.

Contrary to what they believe—that one was going to win, the other would lose— it was a win-win situation, and NAFTA has benefited the three countries. Trade has grown in all three, jobs have grown in all three, and even wage levels have gone up in all three. Today, the economies of Canada, Mexico, and the United States are bigger and stronger than they were 14 years ago. Income per capita for all three has also grown compared to 14 years ago. The benefits are visible, and all you need to do is to talk based on demonstrated results.

To talk about taking a step backwards, in terms of free trade in the case of Mexico, would effectively provoke considerable damage on the economy. And another factor I was discussing yesterday with President Bush—that he reiterated today, and I will reiterate as well—would be a sudden loss of economic opportunities that would even lead to even greater migratory pressure in the—against—with the United States.

We are doing everything we can in order to create job opportunities in Mexico for people so that Mexicans will not need to seek job opportunities outside their country. And the only way to do it is by creating jobs in Mexico, and the only way is, precisely, multiplying our possibilities of trade.

In the case of the U.S. economy, if you were to take a step backwards with regard to NAFTA or free trade, you would be condemning Americans to have one of the least competitive economies in the developed world. While other parts of the world are accelerating their growth, their integration—China, Japan, India, Asia—in order to have more competitive economies and more complementary situations—and Europe is already becoming a single trade group, and they're adding more and more countries to that bloc every year—here you see protectionist voices arising. And the only thing they would achieve, if they were to prosper, would be to condemn North America as a region to complete backwardness in today's world. And that is the worst possible solution you can provide to your citizens.

It is not my role to talk to the three candidates or precandidates to the Presidency. I'm very respectful of the domestic politics of this country. This is a decision that is solely in the hands of U.S. citizens. And for that reason, I must respect that process completely. It is not my role to talk to any candidates or precandidates. All I would do is speak to the person who will eventually be the President of the United States. And we will speak openly and sincerely about the future of both of our countries or, in this case, our three countries in the trilateral meetings that we hold.

But Mexico will have a respectful relationship with the next President of the United States and will always seek the prosperity of our nations, knowing that through free trade, we have a clear, open, and respectful relationship among all our countries that will achieve prosperity.

If we want to solve common problems, if we want to solve problems like security, problems like immigration, problems like economic growth in the United States and in Mexico, we need to understand that only to the extent that North America is more competitive as a region, only to that extent will we be able to successfully face our problems.

Prime Minister Harper. We have been working with the current U.S. administration. We've had a very productive relationship with President Bush and his administration. And I trust that this will continue, that it will continue with any of the Presidential candidates here in the United States.

Of course, it's the United States who needs to make a decision about this election. But I think that in the end, Canada really is confident that the next President will also understand the importance of NAFTA and the importance of the commercial relationship between the United States and Canada. And I must emphasize that for energy security, the commercial relationship between our two countries is even more important today than it was 20 years ago. And I think this relationship will be even more important in the future.

[Prime Minister Harper continued in English.]

——productive relationship with the current administration, and I anticipate that Canada will have a very productive relationship with the next administration, because I'm confident that when the facts are looked at, any President, just as any Prime Minister of Canada, will quickly conclude how critically important NAFTA and our North American/Canadian-American trade relations are to jobs and prosperity on both sides of our border and, in particular, the importance of energy security that is a particularly critical part of the NAFTA arrangement.

Canada is the biggest and most stable supplier of energy to the United States in the world. That energy security is more important now than it was 20 years ago, when NAFTA was negotiated, and will be even more important in the future.

Mexican Government

Q. Yes, good afternoon. I'd like to ask a domestic question but hear from Mexico. President Calderon, I'd like to ask your ideas about the situation in our Congress and also the spot that was presented lately on the statements made by Mr. Lopez Obrador and comparisons with Hitler and Mussolini. What is your opinion of this? And do you think that this helps the unity you've always called for among Mexicans, with regard to the presentation of the bill on energy in our Mexican Congress?

President Calderon Hinojosa. This kind of attitude can only be compared to the people who are making it. Congress is working normally. There is a responsible attitude on the part of most of the political parties represented therein. People from the PRI, the PAN, the Green Party, the New Alliance, other political parties are working firmly. And I simply deplore this attitude, which only impoverishes the image of those behind it and weakens even more the presence of Mexicans from parties as important as the PRD, which, aside from their own internal crisis, are losing their public image because of the activities of people who simply make them look ridiculous.

I hope that our institutional life will be strengthened and that we strengthen dialogue and the capacity for talking among ourselves.

This issue that you referred to is already in the hands of the authorities. And I'm sure that a new electoral authority, like the IFE, will make a decision according to what it seems—it deems fit based on those TV spots you referred to.

Canadian Campaign Finance Regulations

Q. Prime Minister, if you would respond in both official languages: Canadians have seen the RCMP visit to your party headquarters, they've heard the allegations from Elections Canada, and they're wondering what's going on. Did you know about this scheme, and will you practice it again in the next election?

Prime Minister Harper. Well, this is the same story as before. As you know, Elections Canada view is that some of our local spending should count as national spending. We have a different view. We looked into this at the time, and that's the view we've taken.

Our position is always that we always follow the law as we understand it, and, more importantly, we always follow the law as it has been interpreted. We were following, in the last election, the interpretations that had been put on that law in the past. If those interpretations change, we'll, of course, conform, but we will expect the same rules for every single party.

[Prime Minister Harper continued in French, and his remarks were translated as follows.]

And as I just said, it's always the same thing in this for quite awhile. Elections Canada think that some of our local expenditures should at—should be considered as national expenses. But we do not agree with that, and that's why we went to court with this issue. And in the end, we will respect the law and the interpretations of the law as they are, as we have done in the past.

Price of Gasoline/Energy/U.S. Economy

Q. Thank you, Mr. President. Oil prices today rose above $118 a barrel. It's another record. Are Saudi Arabia and other oil producers, are they our adversaries, or have you had any success with your recent appeals with them? And also, the effect of the gasoline prices, isn't that about to erase or certainly erode the benefit of the economic stimulus package?

President Bush. Yes, no question, rising gasoline prices are like a tax on our working people. And what's happening is, is that we've had an energy policy that neglected hydrocarbons in the United States for a long period of time, and now we're paying the price. We should have been exploring for oil and gas in ANWR, for example. But no, we made the decision: Our Congress kept preventing us from opening up new areas to explore in environmentally friendly ways, and now we're becoming, as a result, more and more dependent on foreign sources of oil. Fortunately, Canada and Mexico are our biggest providers, for which we are grateful. But our energy policy is— wasn't effective over the past decades, and now we're paying the price.

And secondly, there's not a lot of excess capacity in the world. As a matter of fact, unfortunately, a lot of the supplies are coming from parts of the world where there's political instability. Fortunately, again, Canada and Mexico are not included in that group. There are some countries that are not reinvesting in their reserves, which decline without maintenance.

And so I'm obviously concerned for our consumers. All the more reason to have passed a rebate, tax relief, and all the more reason for the United States Congress to keep the tax relief I passed permanent. We got people out there campaigning: "Well, we're just going to tax the rich." You can't raise enough money to meet their spending appetites by taxing the so-called rich. Every one of those so-called tax-the-rich schemes end up taxing the middle class families. And in a time of economic uncertainty, we need tax certainty. In a time of rising gasoline prices, we need to be sending a message to all Americans: We're not going to raise your taxes.

Global Economy/Colombia

Q. Good afternoon, gentlemen. For President Bush, how deep and how long will the economic recession be in the United States, and how will it affect Mexico?

And what is your perspective, Mr. President, of the reform presented by President Calderon in Mexico?

And for all three of you, what's the security context that exists with regard to what's happening to NAFTA and the FTA with Colombia after Colombia carried out a military invasion in Ecuador?

President Bush. First of all, I—we're not in a recession, we're in a slowdown. We grew in the fourth quarter of last year. We haven't had first-quarter growth statistics yet, but there's no question, we're in a slowdown. And yes, people are concerned about it, obviously. I'm—of all the three of us standing up here, I'm probably the most concerned about the slowdown. After all, it's affecting the people who I have the honor of representing.

That's why we passed, in working with the Congress, a significant progrowth economic package that will pass back rebates to our citizens, starting in the second week of May. Part of that package also included incentives for large and small businesses to invest in the year 2008. I think this is going to have a positive effect on the economy. Experts say it's going to have a positive effect on the economy. And so we'll see what happens there. The key is for Congress not to raise taxes during this period of time and send a signal that they're not going to raise taxes.

You know, the President is plenty capable of handling reform. She's a—he's a good, honest man who cares deeply about the people of Mexico. And he'll do what he thinks is right for the country of Mexico.

And in terms of President Uribe, we got no better friend in South America than President Uribe. He believes strongly in rule of law. He's a reformer, and he's working hard to protect his country from a bunch of narcotraffickers who murder innocent people to achieve their objectives. And he ought to have our support. He has the support of the United States of America in many ways, but if we don't agree to a free trade agreement that we honest— negotiated in good faith with them, it will undermine his efforts, and it will destabilize parts of the world. And it would be a big mistake for the Congress to turn its back on Colombia.

President Calderon Hinojosa. I simply want to stress the measures Mexico is adopting before this situation—this slowdown of economic growth in the United States, which obviously affects us. More than 82 percent of our exports go to the United States, and we're adopting a number of measures. One of them is a very aggressive program for public expenditure and infrastructure, not just private spending. To give you an idea, Mexico is going from spending 3 percentage points of the GDP per year on infrastructure to over 5¹⁄2 percent of the GDP on infrastructure.

We're talking about Mexico this year having expenses for infrastructural programs of about $500 billion for private-public programs. That's already showing up in the figures of the first quarter of the year.

We're also working on an anticyclic program with very aggressive tax stimulus package for investment in the poorest regions of Mexico, where whoever invests there will get a 100-percent deduction on all investments, and the Federal Government, for a year and a half, will pay all expenses associated with social security, with labor—all the labor costs associated with social security. And that's a very, very strong stimulus package.

The first data coming in indicates that for Mexico, our economic activity had 4.25percent growth rate per year. The figures for February and March indicate that industrial activity continues to show about 4 percent growth. So it's a difficult time because of the enormous interconnection among our economies, but we are prepared to face the situation and at a slower place than the one we've had in the past. But we are dealing with the situation. We are moving with everything at the Government's disposal to accelerate the growth of the Mexican economy.

I hope that this situation will not continue for very long and that soon the authorities in the United States will be able to completely overcome the situation. I think that the steps taken so far by the fiscal tax monetary authorities in the United States and the Bush administration—and in general—have been appropriate. They have been the right measures, and we hope that they will very soon demonstrate effects so that we have a quick recovery among all our economies.

Prime Minister Harper. I would just say that in spite of a slowdown of the economy in Canada, the bases of our economy are stable and solid. And we have undertaken measures to ensure the continuous growth in the future.

Now, as far as the Colombia situation is concerned, Canada has negotiated a free trade agreement with Colombia. And it's important also for the United States and for Mexico to benefit from free trade avec Colombia.

Last year, in the summit, I said that Colombia can have drug trafficking with our countries without a free trade agreement, but if you want legitimate business for all our economies, we need to pursue free trade agreements with Colombia. And I said in New York a few months ago that I worry if the United States in the end refuses this agreement with Colombia.

We have important alliance in Colombia. Colombia is fighting against political violence, against the FARC. They fight against drug traffickers. And I think that a rejection of or turning our backs to such an ally as Colombia is—could create long-term problems for our countries in South America.

[Prime Minister Harper continued in English.]

——free trade agreement to have drug trade with Colombia. You're going to have that anyway. If you want to have legitimate trade and see that country progress economically, we need to have a free trade agreement. We need to have a trade agreement with countries like Colombia.

And I do worry that if the Colombian free trade agreement is rejected, particularly when that country has taken a lot of efforts to fight political violence and corruption and FARC and drug traffickers, if the United States and our allies turn their back on an important ally in this region, that that will have long-term security consequences for all of our countries in North America. So that does worry the Government of Canada.

Trade/Canada-U.S. Relations

Q. If you will allow me, I want to go back to NAFTA. NAFTA is in place for almost 15 years now. Wouldn't it be possible to improve things, perhaps, through renegotiating certain things on NAFTA? Mr. Harper, American President say there's no—we should not renegotiate NAFTA; President Bush says we should not renegotiate. What do you think, Minister?

Prime Minister Harper. We would be ready to do anything that any of our partners wants to do. If one of our partners wants to negotiate NAFTA, we'll do—we'll renegotiate. But this is not the position that we prefer—the Government of Canada. We have an agreement that worked well, that created jobs—lots of jobs in this continent, and I think that the business community is unanimous about the benefits of this agreement.

And I think that the problems that exist really call us to really, perhaps, improve or deepen NAFTA even more. And the problems also justify that we do what we need to do to have trade that works better than it does now. But the right priority is not to renegotiate something that has been decided. This is not the great challenge that we have. When we meet with businessmen and businesswomen, this is not their concern—their main concern. Their concern is in the future, not renegotiating the past. But Canada will always be ready to any possibilities that may happen.

As I said, we have a very dynamic relationship with—relations with the United States. We are the first—or the greatest exporter of energy products towards the United States. And for the United States, we are the main source of energy security for the United States. And we think that now it's even more important—this relation is even more important now than it was 20 years ago, and it will be more important even in the future. So if we have to discuss these possibilities, we'll be in a good position, but we would prefer to talk about the future than the past.

[Prime Minister Harper continued in English.]

I just said before, we'll be prepared for any possibility. The American people are going to make a decision. The future American administration may have a different view. I can just tell you, when I meet businesspeople not just from our country but from around the continent, the benefits of our NAFTA relationship are without question. And what all the focus is in our discussions is how to make it work better, how to make the borders thinner, how to make commerce flow more quickly, more freely. That's—how to make our relationship more integrated and deeper—those are the real concerns that I experience in Canada and when I deal with people who are focused on economic development in our trade partners' economies.

But look, as I said, we'll be prepared for any eventuality. Canada is the United States number-one supplier of energy. And we are a secure and stable supplier. That is of critical importance to the future of the United States. And if we had to look at this kind of an option, I think, quite frankly, we would be in even stronger position now than we were 20 years ago, and we'll be in a stronger position in the future. But my preference is not to renegotiate what we discussed in the past; it's to talk about the future. And I think that's what our respective—that's what, at least, the Canadian population wants us to do.

President Bush. Thank you, sir. Good job, Stephen.