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Mineta Says U.S., EU on Verge of Open Skies Pact

Thanks to the "substantial progress" made by the United States and the European Union in their fifth round of talks, U.S. Secretary of Transportation Norman Mineta is confident that an Open Skies Agreement can "be brought to closure in the upcoming weeks."

Addressing the American Chamber of Commerce in Prague May 21, Mineta said the comprehensive transatlantic open skies agreement "will create the largest, freest market in air transportation ever, with immediate market-opening benefits for all 25 EU member states."

"Study after study shows that Open Skies agreements help expand the overall market for aviation and produce enormous benefits for millions of passengers in the form of better quality, lower-priced, and more competitive services," he said.

The United States currently has 60 bilateral Open Skies agreements, Mineta said. In 1995, the Czech Republic became "our first Eastern European Open Skies partner."

Mineta also noted the signing last month of new U.S.-EU Container Security Initiative agreement, which helps to ensure "reinforces transatlantic cooperation and promotes reciprocity while ensuring that legitimate transatlantic trade is not hindered by the increased security arrangements."

"To the greatest extent possible, the Bush Administration seeks to work cooperatively with international industry and with the EU and other governments to find ways to minimize the threat and mitigate adverse commercial consequences arising from necessary security measures," he said.

Following is the text of his remarks:

AMERICAN CHAMBER OF COMMERCE

REMARKS FOR THE HONORABLE NORMAN Y. MINETA
U.S. SECRETARY OF TRANSPORTATION

American Chamber of Commerce
Prague, Czech Republic
May 21, 2004

Thank you, Mr. Stacey, for that kind introduction, and for the Chamber's gracious hospitality. And I would also like to thank Ken Hillas, Charges des Affaires of the US Embassy Prague.

I appreciate the warm welcome that my wife, Deni, my staff, and I have received since we arrived here in the Czech Republic. Prague is truly one of Europe's gems -- a beautiful city and an extraordinary cultural capital.

The United States and the Czech Republic have a close and long-standing relationship. It is rooted in our deeply held values which bind our countries together.

A passion for liberty that inspired the American forefathers who began America's experiment in democracy is well understood by the Czech people. Like America's Thomas Jefferson and Thomas Payne, the Czech Republic's Vaclav Havel used the power of the pen to sustain that desire for freedom and openness. Last July, President Bush awarded former President Havel our nation's highest civilian honor, the Presidential Medal of Freedom, for giving voice to those who yearn for freedom and democracy.

Today, the United States is proud to have the Czech Republic as a partner in the coalition of freedom-loving nations on the front lines in the war on terrorism in Afghanistan and Iraq.

I am honored to be the first U.S. cabinet official to travel to the Czech Republic since the accession of the Czech Republic into the European Union. We have arrived close on the heels of what is a momentous development for the Czech people. On behalf of President Bush and Vice President Cheney, I want to offer official congratulations.

The EU's expansion into central Europe creates a market of 450 million consumers -- surpassing the market scale of the United States and our NAFTA partners combined. And America is excited to see these developments take hold.

From our perspective, the Czech Republic's membership in the EU signals new opportunities to strengthen our already close bilateral relationship and to build a more prosperous future for the people of both nations through a deepening trade relationship. Everyone in this room fully appreciates that transportation lies at the core of international trade. The global economy depends on the mobility of people, of products, and of capital across borders both safely and efficiently.

Yet the tragic events in Madrid this spring are a stark reminder that transportation assets remain a target of choice by terrorists as they seek to disrupt our economies, test our resolve, and fuel international dissension.

To the greatest extent possible, the Bush Administration seeks to work cooperatively with international industry and with the EU and other governments to find ways to minimize the threat and mitigate adverse commercial consequences arising from necessary security measures.

We are making important progress, as evidenced by our new Container Security Initiative agreement, signed by the EU and the U.S. just last month. This agreement reinforces transatlantic cooperation and promotes reciprocity while ensuring that legitimate transatlantic trade is not hindered by the increased security arrangements.

Hand-in-hand with the challenge of improving the security of our transportation network, we continue to confront the ever-present task of ensuring its safety.

Last month, I was in Paris for the World Health Organization's launch of a year-long campaign to promote road safety around the world. I was joined by Czech officials in highlighting the global challenge of road traffic safety.

The United States is committed to working with the Czech Republic and other members of the international community to make the world's roads safer. By sharing what our experiences have taught us, we can help other nations prevent roadway incidents that, each year, claim more than 1.2 million victims.

My recent trips to Europe have also left me convinced that we have much to learn from one another.

Earlier today, I met with Czech Transport Minister Milan Simonovsky. One area that we discussed was use of inland waterways for the transport of goods and cargo. Europeans have done a superb job of taking advantage of the marine transportation system. So we in the U.S. are eager to learn all that we can about Europe's short-sea shipping operations and how coastal and inland waterways can be used to relieve congestion along the roadways and expand freight capacity so essential to growing trade.

Liberalization of transportation markets is also key to facilitating the movement of people and cargo across borders. Under President Bush, the United States has been very active in promoting liberalization.

Nowhere is our progress more dramatic than in aviation. The United States today has 60 bilateral Open Skies agreements, with the Czech Republic becoming our first Eastern European Open Skies partner in 1995.

The result has been a mutually beneficial relationship for our respective airlines, as well as the traveling and shipping public.

Indeed, study after study shows that Open Skies agreements help expand the overall market for aviation and produce enormous benefits for millions of passengers in the form of better quality, lower-priced, and more competitive services. For example, the average airfare decreased twice as much in Open Skies transatlantic markets between 1996 and 1999 (20%) as it did in transatlantic markets without Open Skies agreements (10%).

The United States has Open Skies agreements with 15 of the now 25 European Union member states. And with the precedent-setting U.S./EU Open Skies agreement now in final negotiation, we stand on the verge of moving the transatlantic air transportation market to an even higher level.

Just last week, in Washington, D.C., delegations from the United States and Europe concluded our fifth round of talks. And I met personally with European Commission of Energy and Transport Commissioner Loyola de Palacio, for a very good and productive discussion.

The substantial progress that the United States and the European Union appear to have made in this latest round suggests that a near-term agreement can, I am confident, be brought to closure in the upcoming weeks. The core elements are in place -- not everything that either side wants -- but a very significant agreement that brings substantial, tangible benefits to both sides.

As we look toward the first-phase agreement, it is important that it be viewed not as an end, but for what it is -- as a beginning. And what a beginning!

The comprehensive transatlantic open skies agreement gives us a rock-solid foundation upon which even greater cooperation can be built. It will create the largest, freest market in air transportation ever, with immediate market-opening benefits for all 25 EU member states.

For the Czech Republic and the other 14 EU Open Skies countries, the agreement strengthens and solidifies our relationship and opens the door for deepening cooperation in new areas of safety, security, competition, and the environment.

Further, the agreement affords carriers and communities direct access between the U.S. and the 10 European countries currently constrained by bilateral legal restrictions.

Significantly, by accepting the concept of the "European carrier," the agreement would afford European airlines flexibility to fly from any European point to any point in the United States and beyond.

Such an agreement would bring obvious benefits to consumers, communities, and carriers on both sides of the Atlantic, creating opportunities for new services and a new template for international aviation. The implications for those doing business in the Czech Republic are enormous. And let me add that your support is essential if we are to realize the tremendous potential of this historic agreement.

I feel very strongly about seeing the agreement succeed. We have before us the opportunity for Europe and the United States to lead the way to a freer, more market-oriented aviation industry and to set the stage for expanded commerce and increased prosperity on both sides of the Atlantic -- and around the world.

In much the same way that the Czech Republic has shown vision by joining the growing European Union, so businesses and governments on both sides of the Atlantic must do their part to move airline liberalization ahead through this comprehensive Open Skies agreement.

The Open Skies agreement is the latest opportunity to build ties and enhance cooperation between the United States and the Czech Republic. By sharing successful strategies and working together bilaterally and through the EU and other multilateral fora, we are improving our transportation networks and the economies that they support.

I appreciate your taking time from your busy schedules to be here and allowing me to share these thoughts with you this afternoon. Travel safely, and thank you very much.