'KINDER, GENTLER' APPROACH TO GLOBAL ECONOMY: LINDSEY.
While US President George W. Bush is spending this week stressing the importance of US military alliances, his chief economic adviser is signaling a similar approach to the global economy, reports the Financial Times (p.4). In the run-up to the administration's first international economic summit this weekend-the meeting of G7 finance ministers and central bank governors in Palermo, Sicily-Lawrence Lindsey is promising a kinder, gentler relationship with America's economic allies.
The news comes as Reuters notes that the ministerial meeting in Palermo will set part of the financial agenda for the main G7 summit in Genoa on July 20-22. Italy is pushing for reform of the World Bank and other international financial institutions, and helping the world's poorest nations through freer trade and the lifting of tariff barriers.
The Americans' new diplomatic approach represents more than just the moderated tones of a new administration, says the FT. The president's senior foreign policy officials-Secretary of State Colin Powell and National Security Adviser Condoleezza Rice-have made clear their desire to integrate economic issues into their broader foreign policy goals. Lindsey noted "a desire by the agencies that are more concerned with foreign policy to have more of a say in a decision before it's made".
"The president has certainly indicated his support for free trade," Lindsey is also quoted as saying. "There are any number of countries with whom we might expand free trade. There are proposals to do it on a bilateral and multilateral basis..."
In a separate report, the FT (p.4) notes that if the US lacks domestic authority to negotiate free trade deals, there is unlikely to be any progress internationally on various initiatives-from a new world trade round to a Western hemisphere free trade deal. Fears of a halt in trade liberalization have led many top US companies to try to broker a compromise between Democrats and Republicans. In an effort to reach out to moderate Democrats, the companies have abandoned their traditional opposition linking trade agreements with provisions to protect labor rights and preserve the environment.
But the effort has already provoked a backlash from Republicans, some of whom still view the linkage of trade, labor and environment issues with suspicion, seeing it either as a covert form of protectionism or as a backhanded effort to impose a liberal regulatory agenda on the US.
The FT (p.8) also notes in a separate report that UN diplomats are hopeful about Powell, whose choice [to visit] UN headquarters today as his first "international" trip as secretary of state did not go unnoticed.