Excerpts from Press Gaggle by Tony Fratto and Dan Fisk, NSC Senior Director for Western Hemisphere Affairs on the North American Leaders' Summit.

WASHINGTON -- MR. FISK: Good morning. On Monday and Tuesday of next week, April 21st and 22nd, in New Orleans, the President will host President Felipe Calderon of Mexico and Prime Minister Stephen Harper of Canada for the North American Leaders' Summit. This will be the fourth time the leaders of the United States, Canada and Mexico have met specifically to discuss the common challenges North America faces, and ways we can advance our common interests. This will also be an opportunity for leaders to review our cooperation under the Security and Prosperity Partnership, known as SPP, and to provide direction for activities under the SPP for the year ahead.

The summit further will allow the three leaders to discuss a number of other questions, from global issues to events in the Western Hemisphere, including -- we anticipate the situation with the free trade agreement with Colombia and also the free trade agreement with Panama.

Let me give you a little bit -- a sense of the schedule that the President will have. Again, he arrives Monday morning, the 21st. Upon arrival in New Orleans the President will be greeted by Governor Jindal and Mayor Nagin. He then -- the President then proceeds to join President Calderon at the opening of the Mexican consulate in New Orleans. This is an invitation extended by President Calderon to President Bush. The two Presidents will make brief remarks at that event.

Following the consulate opening, the President and President Calderon will hold their formal bilateral meeting. The President then meets with Prime Minister Harper for their bilateral meeting.

Monday evening the three leaders will have a working dinner. There is no set agenda for this dinner. Let me put it in another way: The leaders will set the agenda for the discussion at the dinner. And so you're aware, prior to the dinner, or on the way to the dinner, the President will drop by a reception hosted by the U.S. Chamber of Commerce, including a number of businessmen and, again, local officials and representatives. The President will make brief remarks at the reception. So that's Monday.

On Tuesday, the 22nd, the first substantive event of that day will be a meeting of the three leaders with representatives of the private sectors from the three countries. This is something that started in 2006 at the Cancun meeting, when the private sector created something called the North American Competitiveness Council. This is one means by which the private sector can offer recommendations and lessons learned to the three governments as we pursue initiatives -- North American initiatives.

Again, this meeting will follow the format that we've had at both Cancun in 2006, and the meeting last year in Canada, in Montebello.

After the meeting with the North American Competitiveness Council the three leaders meet with -- rejoin their official delegations for the meeting to focus on the North American agenda. This is, I guess, what can be described more formally as the North American Summit meeting. At this meeting the leaders will receive a report from ministers and cabinet secretaries on progress since the August 2007 summit in Canada, and then they will discuss and give direction on priorities for the year ahead.

After the morning's meetings, the three leaders participate in a joint press availability. And then the summit closes with a commemoration of Earth Day -- April 22nd being Earth Day -- and the three leaders will plant a tree in New Orleans Lafayette Square.

What are we seeking to achieve from this meeting in New Orleans and this being the fourth time that the leaders -- North American leaders have met? I guess let me put this in the overall terms, and they're somewhat, I guess, at a macro level. What we would like to achieve is we'd like to enhance and strengthen an already dynamic and strong relationship, to deepen the cooperation by building on the common interests of our citizens to be prosperous and secure. We believe that at its foundations, the North American relationship works; we believe it works well for all three countries, but we also believe we can make it work better.

Let me give you a little bit of a sense of the magnitude and vibrancy of our interaction. This is what I called kind of "North America 101." A lot of Americans focus on the fact that Mexico and Canada are geographic neighbors and don't have a lot more context than that. But, again, let me try to put this in some perspective. Canada is our first largest trading partner in the world; Mexico is our third largest partner.

In terms of three-way trade, as of last year, it was $930 billion -- that's annually, again, in three-way trade. That comes to about $2.5 billion in trade in goods and services on a daily basis. We expect that number to reach the $1 trillion mark by the end of this year. To put this in a different context, a global context, three-way trade between the North American nations is 30 percent of the total global trade of the United States.

Canada and Mexico are our largest sources of imported energy. Canada, by the way, is our largest source of foreign oil; again, something that most people don't focus on. There are roughly 1 million border crossings on a daily basis. If you look at it on annualized terms, 65 million cars, 7 million trucks, 1.5 railroad cars cross the borders annually. There are somewhere around 32,000 Canadians and Mexicans enrolled in U.S. universities. Eleven thousand Americans are studying in Canada and Mexico. And this is only a very small snapshot of the vast social, family, commercial and cultural ties that exist between us.

I give you this context because we recognize going into this meeting that many of the initiatives that are discussed, and what I'm going to present to you here, when you look at them by themselves, they are not going to grab headlines. You're not going to rush out of this room and say that something on intellectual property has been achieved. What the reality is, is that when you bring all these initiatives together in their totality, they have a significant and a potential significant impact on our economy, on us as consumers, and in our position in the world, and also in terms of our security.

So let me just run through quickly what the priorities are and where the leaders have been focused. And this is in part what came out of Montebello last year and what we anticipate the leaders to discuss in terms of priorities in the year ahead.

The five priorities are, first, enhancing global competitiveness; second, smart and secure borders; third, sustainable energy and environment; fourth is safe food and products; and the fifth is emergency management and preparedness.

We turn again to enhancing global competitiveness, and I'll make reference to two issues here. One is regulatory cooperation. In terms of key accomplishments, we have reached agreement with Mexico and Canada on a regulatory cooperation framework. In effect, we've agreed on common regulatory principles, how to move forward in our respective regulatory structures. Again, very respectful that we have distinct legal systems. We've also been able, though, to move ahead on joint regulatory decisions on pesticide approvals so that you don't have to have three approvals in three different countries.

Priority we expect the leaders to talk about in New Orleans is what more can we do, in terms of the regulatory structure that impacts the automobile sector. And this gets to, frankly, a dollars and cents impact for the average consumer in terms of buying automobiles.

A second area in the competitiveness -- under the competitiveness category is intellectual property rights and how the three countries can enhance their protection regimes. What we have achieved so far is better coordination in terms of enforcement on seizing fake products. We also have a pilot program to work amongst the three of us on how we deal with pirated goods coming from outside North America. In terms of what we look at -- are looking at for the year ahead, is what can be done in the arena of strengthened enforcement. This is an issue that everyone agrees needs more work, and the general infra system is to move a more proactive coordination and cooperation.

The second priority is smart and secure borders. Again, this gets to be an issue of real dollars and cents. To give you an idea of the magnitude of this, the Detroit-Windsor crossing accounts for about one-fourth of all trade between the United States and Canada. And if you compare that with, for instance, our global trade, there is more commerce along that one corridor than there are in terms of what we import from Japan -- so to give you again the magnitude of this, so things like ports of entry, the infrastructure. To give you again another example, the Detroit-Windsor bridge was built in 1929. It was -- it's four lanes and was built for traffic in the 1930s. The traffic has increased threefold since then.

So again, I understand unless you're writing for a Detroit newspaper or media, the Detroit-Windsor crossing isn't necessarily a big deal. But if you're a businessman, or frankly for all of us who are consumers, it has a potential impact because if we can't get those crossings to be more effective and efficient, we all pay.

In terms of priorities for the coming year, we're looking at how we can better coordinate amongst the three countries our long-term infrastructure plans and network -- transportation networks coordination. We do want to look at what more we can do at the Detroit-Windsor crossing. We also want to see what we can do along one of the crossings -- the San Diego port of entry, along the Southwest border.

And then the other thing that we are focused on are what are known as trusted traveler programs, that is how you give people identification and you give cargo some kind of security screening so that it can move more quickly across the border.

A third area is energy and environment, and this one we have been able to harmonize energy efficiency standards for freezers, refrigerators and room air conditioners. Again, I know that that's not necessarily something that you would expect leaders of three countries to talk about, but if you have to have energy standards and build three separate refrigerators, and again you look at a market of 450 million people, that has potential consequences there.

We've also talked about, in the past, about other energy efficient standards in other areas. This time we expect the leaders to spend some time talking about carbon capture and storage to mitigate greenhouse gas emissions, and also to see what we can do to better coordinate electricity networks. Again, a major source of electrical power for the United States actually comes from Canada and Mexico.

The fourth agenda item is safe food and products. On this we've spent a lot of time for the past eight months basically trying to determine how you get three governments with three different systems to have a baseline from which to have a conversation. We've made progress on that. We have finalized a number of agreements to exchange information, and now we're looking at how we enhance those and expand those, but also how do we deal with a situation in which we have a recall of a product in one country, and then how do the other two respond, and what's a way to coordinate that. Again, this gets both to an issue of the safety of products, but also in terms of facilitation of commerce.

And the fifth and final area is emergency management, and this is a very simple one. This has been a constant one because the fact of the matter is, natural disasters don't respect borders. Sometimes if there's accidents they don't respect the borders. And right now that -- we don't necessarily have in place, as three governments, as three federal governments, the protocols that allow us to actually operate across the border. There are certain restrictions and structures in which somehow even though you may have been hit by a storm, or there may be some kind of industrial accident, your interests as a country ends at the border. And to a certain extent, that is very artificial, and that is also a case in which we think that is just good government, and in the benefit and the interests of all three countries.

So did not mean to inundate you all with details. I did -- hopefully will warn you that some of these are, I would say, in the weeds. But again part of the totality of the relationship goes to how do you continue to build on a trillion-dollar relationship in which you have literally millions of people moving on a daily basis.

So I'm happy to take questions.

Q There are a lot of questions from the campaign trail of -- particularly from the Democrats -- about the fairness of NAFTA and what they would do to change NAFTA. Are the leaders going to talk about -- try to defend the NAFTA agreement, offer to make any adjustments in it? How is that going to be discussed and presented?

MR. FISK: Well, I won't try to speculate on exactly how it will be discussed. We are anticipating that it will be discussed. We are aware that some of the statements that have been made here have made actually bigger headlines in Canada and Mexico than they have here. And we expect the leaders to talk about it. We think NAFTA works. We think the record of its past 14 years shows that it works.

When the three-way relationship started as of -- in 1994, if you just look at the trade figures, there were roughly $290 billion in three-way trade. I mean, again, we're talking about a trillion-dollar -- coming up on a trillion-dollar trading relationship in the 14 years of NAFTA.

So, again, we want to find ways to, frankly, convince the American people from our perspective, first and foremost, that this is an arrangement that's worked for us and it's also worked for our neighbors. It's been a win-win situation.

Q So the administration's position is it does not need to be fixed?

MR. FISK: There's nothing broken. Why fix a success?

Q Just two questions related to border security. Do you expect the Mexican trucking issue to come up? Because I know that it hasn't been -- there's a pilot program going on right now, but it's not fully implemented, number one. And number two, are there going to be any discussions about what Congress is doing to pass the Merida Initiative?

MR. FISK: The short answer on both of those is, yes. I expect that -- we do anticipate that President Calderon will raise the Mexican trucking pilot program. Again, I'm not going to go into or won't speculate on how exactly, but it's my understanding, from our interactions with the Mexicans, that they were pleased with that. We are fulfilling one of our NAFTA obligations, and the President is fulfilling one of his commitments that he actually campaigned on, on that issue.

On Merida, we do expect that conversation to come up. It is on our agenda, as well as, I understand it, on President Calderon's agenda. We think this is something that is, again, in the interest of both countries. President Calderon has taken a number of courageous actions to deal with the drug violence and the drug cartels in Mexico.

They are under -- parts of Mexico, frankly, have been under siege from the drug-trafficking cartels. We think he's shown not only the political will but he's put actions behind that. For instance, we've had record drug seizures, we've had record seizures of cash involved in the drug trade. We've had 83 extraditions. In fact, I think one of the best statistics on the Merida initiative and why we hope Congress passes it as we submitted -- and we hope they approve it quickly -- is the fact that, according to what I've seen from drug enforcement agencies, that over the last 14 months, which tracks almost perfectly with the 15 months of President Calderon's presidency, we have seen the availability of cocaine on American streets go down and the price of cocaine go up.

And we think that there is a correlation between what President Calderon is doing to fight drugs to make it more difficult for the cartels to get their product to the United States. And we think there's every reason why we should be supporting them. And, again, we hope the President -- the U.S. Congress supports the initiative to do so.

Q One of the big stories of the Western Hemisphere now is the change that's going on in Cuba. I'm wondering if there's a formal setting in which the leaders can discuss this specifically. If I can get your reaction to the latest news out of there -- on cell phones, on travel restrictions. Apparently some moves put to liberalize both. And do you guys have hopes to get Mexico and Canada on board with U.S. policy at all?

MR. FISK: Literally take them in order here, we're anticipating right now that the working dinner on Monday night -- like I said, there is no set agenda that we're staffing. But that is a logical place for the leaders to have a discussion about a number of issues, whether they're hemispheric or global. Again, I would anticipate that Cuba will come up. President Calderon recently had his foreign minister in Cuba. Prime Minister Harper has taken a more proactive interest in Latin America generally. Of course, you all know the President's views very well on Cuba and his commitment to hasten democratic change. So, again, I think it's going to be one of those kind of logical discussion points that will emerge in the course of the conversation.

As far as the changes in Cuba, I think that the polite way to put this is they're cosmetic. I will steal a line from Secretary Gutierrez, who I think puts this in perspective, that it is amazing that after 50 years of the Castro brothers in control, that what Cubans can look forward to is a rice cooker by the year 2010. That is the success of the Castro revolution.

So the fact of the matter is that if Cubans can have cell phones, one question, of course, is -- or one issue is, is how much will they pay for them, and how much will they have to pay for the service. We've already seen, in the case of hotels, for example, that what the regime did is end, at least on paper, the tourist apartheid that existed in Cuba, in which Cubans were denied access to their own hotel facilities. But what the regime turned around and said, okay, we're going to lift that restriction, but at the same time we're going to require that hotels charge Cubans the highest nightly price they can to stay there.

So we would hope that the international community -- and I say that in the larger terms -- recognize that this isn't real change, this isn't fundamental change in the nature of the system. And if you look at what the regime is doing in terms of the continued repression against dissidents and civil society activists, the iron fist is still very, very visible, especially to the average Cuban.

So, since you got me started on that, I'll now get off the soapbox. Your last question?

Q Just whether there's any chance of the harmonization of Cuban policy among the three North American partners?

MR. FISK: Well, I think that, again, there is harmonization to the extent that all three countries agree on the best situation being for Cuba that there is a democratic evolution in which the Cuban people get to decide how they're governed and who governs them. And now, below that there are a lot of tactical disagreements, and I'm not expecting that to change.

Yes, sir.

Q Dan, thank you very much. Just two quick questions for you. On the priorities, you're talking about EMA -- emergency measures. Does that include a discussion of allowing the armies -- in this case in Canada and the United States -- to operate in each other's territories as part of that emergency response initiative?

And also, as you know, the Canadians have complained long and loud about what they say is the thickening of the border between the two countries, primarily because of measures that you've taken under homeland security and so on. Are you going with any "gives" at all on trying to relieve some of that, especially when it comes to security?

MR. FISK: On your question on armies, let me just, if I can, put this into a larger context. When the Security and Prosperity Partnership was created by the three leaders in 2005, there was a decision at that point that the military-to-military relationship would not be a formal part of the SPP. The focus has been on law enforcement -- the focus, in terms on the security side -- law enforcement and homeland security-type security measures. And that's where the conversations remain within the SPP context. That's where we expect the conversation to remain in New Orleans.

That does not in any way sidestep the issue that our military, of course, has an engagement and interaction with the Mexican military. We have a very strong relationship between the United States military and the Canadian military, most visibly represented through NORAD. But in terms of emergency management, this is, first and foremost, about how do we get first responders to be at, or coordinate and cooperate when you get into an incident or an event that is going to occur in a border region, specifically. It is not going to the issue of militaries and armies. It's very much focused on that point.

The second one, on the line about thickening the border, a phrase I'm well aware of, we have consistently -- and I'd say, more appropriately, the Department of Homeland Security has consistently tried to work with the Canadians, to be as transparent as possible with them, explain to them kind of the process, what we're doing, how we're going about it, trying to make sure that we meet all of our legal requirements, but we also facilitate trade and travel.

Those conversations will continue to some extent at a leaders level in New Orleans. But it's not necessarily a case in which the leaders -- we expect them to negotiate or announce anything. In fact, if you look at it, one of the Canadian "asks" has been that the date be moved, which it now has by statute to no implementation -- no earlier than June 1, 2009. So for us it's a matter of how we are best positioned to implement so that when that day comes we can proceed, and in the course of that, how we can make sure that we're synchronized with the Canadians to the maximum extent possible so that the free flow of legitimate goods and people can occur with minimal disruption. So that's where we're focused.

Q In the President's discussions with Calderon, will the issue of -- concerns about Hugo Chavez's influence in the region, especially in light of the water crisis involving Venezuela, come into play?

MR. FISK: I think it's like the Cuba question to the extent we expect they will talk about the hemisphere. Again, you have got Prime Minister Harper's own interest in the region. President Calderon tried to play a constructive role between Colombia and Ecuador during the -- in the aftermath of the killing of Raul Reyes.

So there is -- again, there is a lot of interest in the hemisphere. So I'm also expecting Venezuela to come up, and you all know as well how the President feels about that topic.

So I don't know that, again, would not say that there's any expected announcements. I don't want to leave you all with any impression. But I do -- I will leave you with our anticipation that at least at one of the exchanges between the three leaders, Venezuela, Cuba and other issues are very likely to arise.

Q Can I get just one more? Can you talk a little bit about the automobiles -- this is under the competitiveness thing -- automobiles and intellectual property? What exactly is at stake? What are you trying to do --

MR. FISK: Well, let me -- let me give the general -- as you all know, I'm the foreign policy guy, not the regulatory guy, if I can put it that way. I will be happy to refer you to the Department of Commerce, who has the most direct SPP role in that. But what we're trying to do in the whole regulatory area, what we're trying to do is see if there are ways within our legal -- three distinct legal systems, of how we can better harmonize certain standards. For instance, whether they're fuel efficiency standards, or, another big issue we hear from the private sector is testing. In other words, if you have a product, why do you have to test it three different times and three different ways? Why can't you just do it once and satisfy all three?

So what we have asked, or what leaders have asked the regulators to do is say, within your existing parameters and authorities, where are there areas that we can minimize duplication? Where are there areas where, if one -- where all three countries can be satisfied with -- whether it's a test or how a part or a widget works, and that that should meet the standard.

And the reason we focused on automobiles is because the nature of that trade is so large -- most people don't realize you might -- you may buy a car that says "Made in America," but of which a significant number of its parts are actually made in Canada. In fact, one data point I've heard is the average movement of an automobile between a factory in Michigan and in Ontario is eight times to cross the border. And this -- I can't vouch for this number -- one number I've heard is that potentially adds upwards of $800 to a cost of an automobile.

Our goal is, why does it have to go through this burdensome process eight times? Why is it costing us more money? Isn't it better for everyone -- Canadians and Americans and Mexicans -- to try to minimize that to the extent we can.

That's kind of the best that I can describe it to you, and I would, again, encourage you to talk to the Department of Commerce.

Q And on the IP stuff?

MR. FISK: On the IP stuff, again, it's -- where the conversation has gone is, what more can we do cooperatively on enforcement? That's it, yes. All right. Thank you all.