Poverty, terror a challenge in Asia future

Poverty, terror a challenge in Asia future

By Glenn Somerville, Reuters, NEW DELHI,

Wrapping up a tour of three South Asian nations plagued by
poverty and terrorism, U.S. Treasury Secretary Paul O'Neill on
Sunday rejected the idea the two were directly linked but added
wealthy nations must help Afghanistan, Pakistan and India deal
with both scourges.

After a week in the region that featured a rapid visit to
Afghanistan in support of rebuilding efforts in the war-ravaged
country and longer stays in the other two nations, the U.S.
Treasury chief headed for England to speak to a business group in
Manchester on Monday before heading for Washington.

Speaking to reporters before leaving India, O'Neill said he
was struck by the South Asian region's acute need to stimulate
economic growth to deal with a teeming population. Collectively,
the three countries account for about a third of the people on
earth, many of them in rags and jobless.

O'Neill's apparent intent included demonstrating Bush
administration backing for private sector-led development and for
better use of Western aid as well as stiffening the fight against
money flows to terror groups. He insisted each had equal urgency.

"I don't think the fact that you are poor causes you to want
to go out and kill people you don't know, it takes more than
that," O'Neill said, adding the challenge was a larger one to try
to bring some relief and protection on both fronts.
"I don't think it's necessary to say we've got to do one and we
can't do the other," he said.

"We've got to do both, in fact we've got to do 50 things or a
thousand things and the idea that emphasis on one excludes
emphasis on the other is just dead wrong."

Afghanistan was a case study in the region's acute needs, its
citizens living on an average income of less than US$1 a day a
year after the United States drove out the hard-line Taliban
rulers.

But O'Neill, who met Afghan President Hamid Karzai and
squeezed in quick visits to a girls' school and other sites in
eight hours in the country, stressed U.S. determination to help
the shattered country rebuild.

"Afghanistan will not be forgotten..the United States is
committed to be here for the long term," he told a press
conference in Kabul.

Rifles and heavy-duty military equipment were evident around
the sandbagged city, but bright spots included a visit to a
girls' school where eager students attended in shifts so that a
larger-than-expected swell of students could be accommodated.
In Afghanistan as elsewhere in the region, O'Neill preached his
faith in private-sector involvement and in trade to foster
prosperity, but a bid for a regional trade initiative that would
drop barriers to flows of goods between Afghanistan, Pakistan and
India met at best measured success.

"I don't know, we'll see, " O'Neill said when asked if he felt
he had made progress. "I found in talking with businessmen an
unfettered interest in that idea."

Smuggling is rampant in much of the region, especially
Afghanistan, and cross-border trade is virtually unregulated with
fees and charges taken by warlords or those able to collect them.
In two days in Pakistan, O'Neill mixed visits to schools and
high-tech sites with official meetings with his counterpart,
Finance Minister Shaukat Aziz and President Pervid Musharraf.

He said on Sunday that Pakistan's military leader expressed
strong philosophical conviction during a meeting that his main
goal was finding ways to promote economic growth.

"He didn't talk to me about tactical maneuvers of tanks and
stuff but of where all of the things he has started doing will
lead in terms of creating a prospect for a better life for people
in Pakistan," O'Neill said.

It would serve the interests of the whole region if the
leaders of the three nations had more direct conversations, he
added.

That is unlikely soon, with India and Pakistan in a state of
continual tension over hotbed areas like Kashmir, disputed by
both nations and where Islamic terror groups are active.

O'Neill delivered one of his most toughly worded speeches to a
business group in New Delhi, warning that widespread corruption
and bribery were "frightening away honest businessmen and
investors" and had to be brought under control.

"Respect for property rights and protection against public or
private thievery is an essential ingredient for economic
success," the U.S. Treasury chief said.

Self-dependence instead of more aid and reforms to create
conditions attractive to foreign investors was a common theme of
O'Neill's public presentations, especially in India where he said
the prospect of its current one billion population growing by 700
million in the next two decades was daunting.
"I don't think the world's economic development problems can be
solved by charity," he said on Sunday.
"I do think that as governments create circumstances both for
their own good and for creating a context in which development
can occur, then foreign direct investment will come."