Remarks for Ambassador Charles Glazer
CAFTA Second Anniversary
February 28, 2008

As an entrepreneur for most of my working life, I love hearing from other entrepreneurs like you.  Many people think of the United States as this great big economic machine of large companies.  In fact, small firms represent 99.7 percent of all employer firms in the United States.  Many who have opposed entering into free trade agreements with the United States claimed that large U.S. companies would come to their country and take over its economy.  That hasn’t happened here in El Salvador, or elsewhere in the world.

Salvadoran small and medium businesses are finding new opportunities, as shown by the impressive growth of non-traditional exports under CAFTA-DR.   Service exporters are increasing their business, offering quality service at lower prices than their competitors.  The food and beverage sector -- especially companies producing “nostalgic” products -- has shown some of the most impressive growth. 

It is small business that drives the United States economy.  Similarly, small business is critical to the growth of El Salvador’s economy.  It is no coincidence that El Salvador’s growth over the last two years – its highest in a decade – comes in the same period that it has implemented CAFTA-DR. 

All the examples today show how the benefits of trade spread out.  It has been true in the United States and it is true here too.   An exporter has to hire staff to make the product.  He or she has to buy raw materials.  Exporters often lease offices, work with packagers and shippers, and the list goes on.  Every new export benefits not just the exporter, but everyone down the line. 

The United States is committed to supporting small and medium enterprises, because we know it pays huge dividends.  It’s a big part of our trade capacity building programs with our CAFTA-DR partners.   U.S. Department of Agriculture programs have helped Salvadoran agricultural exporters.  USAID’s Aid to Artisans program has helped create thousands of new jobs in rural El Salvador and establish a new market for handicrafts exported to the United States.  Other programs, like the Export Promotion Program, help link small exporters together to take advantage of economies of scale and the lower costs that follow.      

But more can still be done.  Small and medium businesses with good products and ready markets often find themselves unable to get financing for their ideas until they can already show they are exporting.  Without exports, they can’t get financing, but without financing, they can’t export.  We must find new ways to encourage entrepreneurship.  This can mean new programs,  but it can and should involve the private sector – encouraging new and innovative lending to companies that have good business plans, be it from banks or from private venture capitalists. 

Salvadorans are innovative and already successfully competing with the rest of the world.  Agreements like CAFTA-DR help Salvadorans compete by lowering trade barriers and providing clear and fair rules so that everyone can participate and benefit from trade.  We need to make sure that everyone follows those rules.  CAFTA-DR has a bright future, and as each anniversary passes, I know that with the work ethic and entrepreneurial spirit of the Salvadoran people, we will see more and more successes like we have today.    Thank you.