Lima, August 9, 2006.- The Andean Community and Venezuela today signed a Memorandum of Understanding whereby the trade advantages received and granted to the parties pursuant to the Andean Liberalization Program will remain fully effective despite Venezuela’s denunciation of the Cartagena Agreement this past April 22.

They also agreed to form a Working Group to, within a period of 30 days extendable a further 30 days, propose regulations for the trade between the parties and a dispute settlement mechanism that would be applicable to that reciprocal trade.  

In pointing up the economic and political importance of this agreement, the Acting Secretary General, Doctor Alfredo Fuentes, stated that it safeguards the historical trade between Venezuela and the CAN Member Countries that amounts to 4 700 million dollars and is responsible for hundreds of thousands of jobs, particularly in small and medium-sized enterprises.  

Fuentes stated that the signing of this agreement creates clear expectations that the liberalization program will be maintained, thereby benefiting future investments in this market. 

He went on to report that, as the Memorandum of Understanding stipulates, the two parties will sign an agreement no later than October 30, 2006 that will incorporate the temporary provisions regarding origin, safeguards, dispute settlement, sanitary and phytosanitary measures and obstacles to trade that will be applicable to the liberalization program for the trade in goods.

The Memorandum of Understanding was signed by the Plenipotentiary Representatives of the Member Countries of the Andean Community (Bolivia, Colombia, Ecuador and Peru) and the Plenipotentiary Representative of the Bolivarian Republic of Venezuela and was then endorsed through Decision 641 adopted by the CAN Commission during its 128^th special session held yesterday and today.  

Through this Decision, the Andean Ministers of Trade instructed the General Secretariat of the CAN to advance the technical work and coordination needed to fulfill the tasks assigned to the Working Group.