Lima, February 1, 2006

You are visiting the home of Andean integration at a time when the region in being swept by radical political and economic changes that carry with them the hopes and aspirations of our peoples and, at the same time, are revaluing the role of our Community project.  

Andean integration is seeking, amid complex national transitions and within a context of multiple debates over the best way to advance development, social equity and our countries’ participation in the world economy that are frequently difficult to understand outside our region, to refine and enhance our approaches and actions in order to meet the needs of and challenges facing our Member Countries more effectively.   

The fact that in 2005 we set a new record in inter-Community trade --a figure approaching 9 billion dollars, by our most recent reckoning--  shows the growing importance to all of our countries of the expanded market because of the large value added component of this trade and its visible impact on employment and the spread of the subregion’s small and medium-sized enterprises.  The large upsurge in Community exports to the rest of the world, which also reached a record figure of over 90 billion dollars, confirms that Andean integration, rather than being an exclusive option, is operating like a strategy to complement our countries’ trade with other regional partners and links to world markets. 

It is necessary to recognize, however, that the “critical mass” of our inter-Andean trade can be enlarged even further by incorporating a still insufficiently explored field of services and new manufactured goods and by overcoming the barriers and structural shortcomings of our commodity-driven pattern of specialization vis-à-vis the world market.   These trends make it necessary for us to reach a virtuous interaction that has eluded us thus far, between trade and development, in which not only the role of multilateralism, but also the very legitimacy of the present globalization process, are at stake.   

The Sixth WTO Ministerial Conference, held in Hong Kong, was able to maintain the current pace of world negotiations and keep optimism alive over obtaining the benefits of that “virtuous interaction” for the developing countries.  In fact, by making the use of medicine patents more flexible in certain situations, the prior intellectual property agreement is an example of what can be done to improve people’s access to health.  Another significant accomplishment of the Hong Kong Ministerial Conference was to set 2013 as the deadline for complying with the commitment to phase out agricultural export subsidies, on condition that “full modalities” are defined for market access.  No less important is the commitment to eliminate cotton export subsidies in 2006.   

These are initial steps toward the major “development agenda” objective defined with the launching of the Doha Round.  We all agree that the road to be followed is still tortuous and calls for a large dose of multilateral political will in order to conclude the negotiations, particularly on the part of the industrialized countries.   

The initial aims of the Ministerial Conference were highly ambitious, as we all know, and some of the substantive decisions were postponed, in some cases because of their political complexity and in others due to the technical difficulties in their approval.  Even so, the commitment to move ahead in the immediate future was maintained and a working plan was defined for 2006.   

I would like to emphasize, in this context, the effort that you, Mr. Lamy, have made at the head of the WTO --over the short period of time you have occupied that demanding position-- to safeguard the commitment of the leading actors to the negotiating process and, above all, your contribution toward building up trust that the Doha Round will conclude shortly.

The Andean Countries were closely involved in the preparation of the preliminary texts taken to the Hong Kong Ministerial Conference and spoke out during the meeting in declarations that form part of the political backing for further progress on and deepening of the commitments.   The presence at that meeting of spokesmen from our countries, as authorized as those who are with us today at this special meeting of the Commission, excuses me from dwelling on the proposals they laid before this important Ministerial Conference. 

Even so, important responsibilities and tasks need to be fulfilled over the next few years to ensure that 320 million people are able to emerge from poverty by 2015 --according to estimates made by the WTO itself-- in the event that we commit ourselves wholeheartedly and effectively to this virtuous interaction between trade and development.      

This calls for a longer-term working program aimed, of course, at phasing out agricultural protection and subsidies on the part of high-income countries, reducing obstacles to trade that still exist in the manufacturing sector (particularly textiles and garments) and liberalizing services, while reserving spaces for public policies.  All of this should also be oriented toward obtaining full liberalization of trade in tropical products and products that are particularly important for replacing illegal crops in the worldwide antidrug effort; guaranteeing equitable distribution of the benefits of sustainable exploitation of biological diversity and financial compensation for the traditional knowledge of our indigenous peoples about the use of biodiversity; and supporting the competitiveness of the developing countries in fields as diverse as ports, domestic transportation, telecommunications, worker training, etc.; and  making SME exports the driving force for our countries’ socially inclusive development.  

The year 2006 will be definitive for the final course of the Doha Round and for that reason the WTO should be consolidated as a multilateral vehicle par excellence for moving ahead in the medium term with the pending development agenda, in a context in which trade will evolve hand-in-hand with social equity and democratic governance. 

We are aware that these decisions will require a large measure of political capital and we Andean Community countries are willing to invest it.  Mr. Lamy, you can count on our sincere participation in this daring undertaking you have launched. 

Thank-you.