Consider what happened last May. I touched down in Beijing for the fourth round of the U.S.-China Strategic and Economic Dialogue with a jam-packed agenda that included everything from the South China Sea to intellectual property rights to North Korea provocations. But the world's attention was focused instead on the fate of a blind human rights dissident who had sought refuge in our American Embassy. Suddenly an already delicate trip had become an outsized test of the U.S.-China relationship. This could have been, and many predicted it would become, the spark for a serious breach between two great powers unable to trust or understand each other. But this is not 1912, when friction between a declining Britain and a rising Germany set the stage for global conflict. It's 2012, and a confident America has encouraged China to take greater responsibility in regional and global institutions. And we have built mechanisms like the Strategic and Economic Dialogue that help manage disagreements and promote trust.
In the end, the relationship we have worked so hard to build with China proved more durable and dynamic than many feared. Both countries stayed focused on our shared agenda and engaged candidly on a wide range of critical issues. And today, that dissident is safely studying law in the United States. Looking ahead, we have to build on this foundation. As I like to tell my Chinese counterparts, zero-sum thinking will only produce negative-sum results.
This also applies to our relationship with Russia. We have made some progress with Moscow on areas such as nuclear arms reduction, sanctions on Iran, and trade. And we continue to seek new issues where we can cooperate together. But the reality is we have serious and continuing differences with Russia - on Syria, missile defense, NATO enlargement, human rights, and other issues. So we have to take a smart and balanced approach going forward. We need to continue expanding our engagement with Russia, but with very clear eyes about where we draw our lines.
We also have to engage with a set of emerging democratic powers like Brazil and Mexico, India and Indonesia, South Africa and Turkey, that are exercising greater influence in their regions and on the world stage. The strategic fundamentals of these relationships - shared democratic values, common economic and security priorities - are pushing our interests into closer convergence. This is reflected in the broad strategic dialogues we have launched with these emerging powers. The key going forward will be to encourage them to leave behind the outdated politics of the past and take up the responsibilities that come with global influence, including defending our shared democratic values beyond their borders.
Let me turn to the third element of our agenda, what I call economic statecraft, because this will certainly help to shape our engagement in Asia and our relations with emerging powers. The United States is moving economics to the center of our foreign policy. In response to the trends I mentioned earlier and that you have been discussing, countries that are gaining influence more because of economic prowess than military power, and market forces shaping the strategic landscapes, are clearly driving change. We can either watch it or shape it.
Last year I laid out America's economic statecraft agenda in a series of speeches in Washington, Hong Kong, San Francisco, and New York. Since then, we've accelerated the process of updating our foreign policy priorities to take economics more into account. And that includes emphasizing the Asia Pacific region and elevating economics in relations with other regions, like in Latin America, for example, the destination for 40 percent of U.S. exports. We have ratified free trade agreements with Colombia and Panama. We are welcoming more of our neighbors, including Canada and Mexico, into the Trans-Pacific Partnership process. And we think it's imperative that we continue to build an economic relationship that covers the entire hemisphere for the future.
Africa, which is home to seven of the world's ten fastest-growing economies. People are often surprised when I say that, but it's true. And we are approaching Africa as a continent of opportunity and a place for growth, not just a site of endless conflict and crisis. All over the world, we are turning to economic solutions for strategic challenges; for example, using new financial tools to squeeze Iran's nuclear program. And we're stepping up commercial diplomacy, what I like to call jobs diplomacy, to boost U.S. exports, open new markets, lower the playing field - level the playing field for our businesses. And we're building the diplomatic capacity to execute this agenda so that our diplomats are out there every single day promoting our economic agenda.
Now, our new focus on economics is also changing how we practice development around the world. Consider this: In the 1960s, official development assistance from countries like the United States represented 70 percent of the capital flows going into developing countries. Since then - even though we have actually increased our development budgets - because of surging private investment and trade, that official development assistance represents just 13 percent of those capital flows. So we are refocusing our approach to development to better harness market forces and make public sector investments that catalyze sustainable private sector growth.
Now, the fourth agenda item is very much on our minds today. What does the future of the Arab Spring hold for those who are experiencing it and for all the rest of us? One day we see the new government of Egypt stepping up to help mediate a cease-fire in Gaza, and the next it is raising concerns through new far-reaching constitutional decrees. We see territory slipping from the grips of the Assad regime, even as the opposition faces questions about its own coherence and the presence of extremists in its midst. Libya has freely elected moderate leaders, but has also become home to extremists and roving militias. Iran continues to cling to its nuclear ambitions while its economy crumbles. And just today, the Palestinian Authority, which has eschewed the violent path of Hamas and others, pursued a diplomatic move at the UN that is counter-productive to the cause of a negotiated peace.
I will have more to say about that tomorrow night at the Saban Forum here in Washington, but for today let me offer this one thought for U.S. strategy in the region going forward. We cannot view any of these challenges or changes in a vacuum. They are all connected, and our strategy needs to account for the intersections and relationships.