Lima, August 23, 2006

I would like to start off by cordially welcoming you to the home of Andean integration, which is your home. The General Secretariat is particularly pleased to host this interesting Seminar, “Peru and Chile: opportunities in the Asia-Pacific region” organized by the Institute of International Studies of the Pontifical Catholic University of Peru, the Ministry of Foreign Affairs of Peru and the Embassy of Chile in Peru.

It is also indeed an honor to receive such illustrious visitors: our dear friend, highly distinguished Ambassador and former colleague and now the Minister of Foreign Affairs of Peru, José Antonio García Belaúnde, and the distinguished Foreign Minister of Chile, Ambassador Alejandro Foxley. As you all know, Chile was one of the main proponents and founding members of the Andean Group, created in 1969 to promote its Member Countries’ harmonious and balanced development under equitable conditions and to reduce existing differences in development, in an effort to better the quality of life of their inhabitants.

Although Chile decided in 1976 to withdraw from the Andean Group --converted into the present Andean Community in 1997 -- , the Member Countries of the CAN and that sister country have always maintained close ties, ties that have been incorporated in, among other things, Economic Complementarity Agreements that initially emphasized the liberalization of the trade in goods and that are now being broadened and perfected to extend to other fields like services and the reciprocal promotion and protection of investments.

An important example of this new stage of deepening relations with Chile is the signing yesterday by the Foreign Ministers of Peru and Chile of an expansion of the ECA between the two countries. It has been stressed that that expansion is not only binationally strategic for the Asia-Pacific trade area to which the two countries belong, but will also make it possible to consolidate and surpass the level of opening to investments between the parties and will facilitate access in fields like the provision of cross-border services through the disciplines of national treatment, most-favored-nation, the non obligation for a local presence and the non imposition of quantitative restrictions.

During its 37 years of integration, the Andean Community has moved significantly toward the goals established in the Cartagena Agreement, achieving some of them like the full free trade area, a partial customs union with low levels of protection, service liberalization with general and sector rules, facilitation of people’s circulation and the locating of investments, and the development of a strong dispute settlement system that gives Andean legislation juridical security. The Andean agenda has been enhanced in recent years through the addition of topics like the social agenda, physical and energy integration, the environmental strategy, the development of strong democratic institutions, actions to increase common external security, and the launching of a common foreign policy that will enable us to move ahead in our negotiations with the European Union and to join efforts in building the South American Community of Nations.

Trade in manufactures among the Member Countries has ballooned in this context, topping US$ 9,072 million dollars in 2005. Despite Venezuela’s withdrawal, we were able this month to sign an agreement with that country to maintain the benefits received and granted in the free trade area.

Our trade relations with Chile have also been significant and growing. Andean exports to that country have almost tripled over the past four years to nearly US$ 1,560 million in 2005, due particularly to the heavy growth of Peruvian and Colombian exports, although important advances were made in all of the Andean countries. Peru is the foremost buyer of Chilean products among the Andean countries, followed by Colombia, Ecuador and Bolivia.

Dear friends:

This seminar is being held at a transcendent moment in the lives of our countries, for, within the context of the globalization process that characterizes contemporary international relations, we Andean countries and Chile find ourselves searching for broader and better access to the different markets while, at the same time, we seek the best way to work together to carry this process to the best possible conclusion.

Chile’s forthcoming reincorporation into the CAN as an Associate Member Country will enable us to strengthen even more the existing ties so that we can further integrate our economies, our academic and business communities, our societies in general and, above all, our democratic systems --all of this in order to contribute to the development and to the fuller participation in the world economy of the vast subregion we share.”

For that reason, this seminar couldn’t be taking place at a better time. I am certain that it will offer a profitable space for reflection about the challenges and opportunities that Chile, Peru and the other Andean countries can and should profit from by joining efforts and strengths to build greater social wellbeing.

The presence of the Chilean delegation in this room, together with such distinguished entrepreneurs, academics and officials, evokes pleasant memories of the tenacious efforts and leadership of illustrious Chileans, like Eduardo Frei Montalva, Gabriel Valdez, Salvador Lluch Soler and Juan Somavía Altamirano who, together with other eminent Andean citizens founded and advanced subregional integration, convinced of its importance for our countries’ balanced and harmonious development. The results speak for themselves. Today, although our economies and societies have changed considerably over the past 37 years, the aspirations and need for integration have remained the same and continue to be a just expectation of our nations, whom we shall not disappoint with this new alliance we are building between Chile and the Andean Community and its Member Countries.

Thank-you very much.