By Guillermo Fernandez de Soto
Secretary General of the Andean Community
Lima, December 2003

Integration nowadays is not what it used to be 34 years ago. Being aware of this reality, when I took office as Secretary General of the Andean Community I mentioned that it was essential to make this subregional process transparent, and define a new multidimensional agenda, within the framework of a second generation of policies. I also mentioned that we need to go ahead of ourselves and work together towards the creation of a more balanced world which we are ethically obliged to build in this century.

During this year, the task of dealing in greater depth with subregional integration was fully defined, as was set forth in the agreements signed by the Heads of State in the Declaration of Quirama, in June 2003.

This goal was achieved with the collaboration of the Andean Presidents and Governments, whose valuable and permanent support enabled the reactivation throughout this period of the thematic agendas with the different ministries and government agencies, thus contributing to a significant enrichment of the integrating action.

Upon completion of my mission in the Andean Community, I wish to highlight some important events that will open a new horizon for subregional integration and the well-being of our Andean peoples.

• Definition of a new integration agenda, which goes beyond an exclusive emphasis on trade issues and widens the range of action towards strategic areas such as common foreign policy, social development, physical integration and border development, as well as environment and energy alliances.
  
   

• Adoption of a Common External Tariff (CET) for 62% of intercommunity trade, which had been postponed for several years and should now be preserved, with the pertinent adjustments, if we wish to advance towards a perfect Customs Union and create a Common Market in the future.
  
   

• The new emphasis placed on the social dimension of the integration process, which enabled the adoption of decisions aimed at designing and developing specific and coordinated strategies on social cohesion, fight against poverty and exclusion. These will simultaneously contribute to the creation of a Common Market and the consolidation of democracy and governance.
  
   

• The signing of a new political dialogue and cooperation agreement between the Andean Community and the European Union, which represents a qualitative step forward in bilateral relations since it involves a well-structured dialogue in several fronts and increases cooperation in new areas which are of vital importance for the Andean subregion, such as peace and security, social and political stability, democratic governance, trade cooperation and migrations. Furthermore, this Agreement will set a sound foundation for starting in 2004 the negotiations of an association agreement between both regions, which will involve a free trade area.
  
   

• The signing of a Free Trade Agreement between the Andean Community and MERCOSUR, which is one of the most significant political expressions for the creation of a South American space.
  
   

• The United States announcement to formally start negotiations for a Free Trade Agreement (FTA) with the four Andean countries that are beneficiaries of the Andean Tariff Preference Act (ATPDEA), represents a new opportunity, maybe the last, to deal in greater depth with subregional integration.
  
   

• The approval and implementation of the Andean Plan for Prevention, Fight and Eradication of Illegal Small and Light Arms Trade, which makes us the first integration scheme in the world that incorporates a binding instrument in this aspect.
  
   

• The establishment of a regulatory framework for a subregional electrical grid system, which has had a favorable impact in the Andean Community productive sectors and populations, particularly in Colombia and Ecuador. In addition, progress has been achieved in the development of Colombia-Peru and Peru-Ecuador joint projects.
  
   

• The realization of strategic alliances with the main world actors in environmental protection, such as Conservation International and the United Nations Environment Programme (UNEP).
  
   

• Definition of cooperation programmes with the European Union, the US Agency for International Development, the Inter-American Development Bank, and the Andean Development Corporation, which will contribute to the implementation of an Andean multidimensional agenda.

I believe that the tasks for the future are enormous and demand from us important considerations and definitions of a political nature. In the current world situation, the Andean subregion will gain importance only if it succeeds in asserting its aggregate assets, as well as defining the correct way to insert itself in the global economy, in order to find a solution for the problems of governance which, as a result of realities such as poverty, inequality and other aspects of our common social agenda, should be given a top priority, otherwise we run the risk of weakening our democracy and allowing the transnational organized crime forces to triumph over democratic institutionalization.

The agenda for this stage of the process is available to the States. It is now up to the Andean Governments to continue making correct, future-oriented decisions that will benefit almost 120 million inhabitants of the subregion.

I am convinced that if we work together we will be much stronger in our efforts to build a new Andean integration horizon.