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REGION: PRESIDENT GEORGE W. BUSH HOLDS FIVE-HOUR SUMMIT ON TRADE, IMMIGRATION, TERRORISM IN VISIT TO EL SALVADOR.

Article Excerpt
In his brief visit to El Salvador March 24, President George W. Bush reiterated his interest in negotiating a free-trade treaty with Central America, a proposal that has delighted regional leaders who see trade as the way out of poverty. Bush showed less interest in some other topics of great importance to the region, especially immigration.

Bush's five-hour stopover in El Salvador was part of a trip that took him first to Monterrey, Mexico, to attend the UN International Conference on Financing for Development, and then to Lima, Peru.

In Monterrey, Bush elaborated on his new theory that poverty and terrorism are linked. Until this year, Bush, like his predecessors, had generally held the view that poverty abroad, like poverty at home, was best tackled with trickle-down or supply-side economics designed to persuade wealth to create jobs and eventually lift all boats with little direct government intervention.

Bush alters policy on aid, trade

Just before his Latin American trip, however, Bush announced his support for a US$5 billion increase in foreign aid over the next four years. While modest in percentage points, the increase was seen internationally as a breakthrough in US thinking on aid.

In Monterrey, Bush said poverty was related to hopelessness and terrorism. "Hope," he said, "is an answer to terror."

Cajoled by the European Union (EU), some of whose members give many times more than the US in foreign aid, Bush increased the pledge to US$15 billion over three years, and said he hoped to get the money flowing within a few months, instead of years.

Even with the promised increase, however, US foreign aid would rise only from 0.10% to 0.13% of budget expenditures compared with 0.39% promised by the EU. UN Secretary General Kofi Annan wants to see the aggregate from all nations rise from 0.22% to 0.70%.

Bush said conditions would be attached to the "new compact" for development. The rich nations are to give more aid, but the poor nations will only get the aid if they curb...

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