Brussels, March 27, 2006

The vocation of the Andean integration process for socially inclusive development was given explicit expression in the signing of its founding treaty in 1969, which states that the end purpose of integration and of economic and social cooperation among the signatory countries is the “growing improvement in the standard of living of the Subregion’s inhabitants.” The debt crisis and the change in economic model in the nineties, however, resulted in a redirection of the integration project, reducing the priority of joint development efforts.

Although the macroeconomic stabilization brought about by this change is highly commendable, the paucity of results in terms of development and social equity are clear for all to see: poverty rates similar to those that existed twenty years ago; high unemployment and underemployment rates in all of our countries; income and wealth concentration levels that place us among the world’s most socioeconomically unequal areas; and a widespread feeling of insecurity and social vulnerability.

In order to cope with these realities, which in some countries have taken on characteristics of social and governance crises, the Andean Presidents resolved, at the Quirama Summit in 2003, to give a decisive boost to the development of the integration process’s social agenda. This made it possible to organize and, above all, to extend important efforts that had already been launched in 1999 in regard to the social dimension of Andean integration.

In September 2004, following a lengthy process of consultations within the five countries, involving both State institutions and non-governmental organizations and academic sectors, the Andean Council of Foreign Ministers approved the Integral Plan for Social Development (IPSD).

The IPSD is a proposal that responds to an integral and structural vision of the phenomena of poverty, inequity and social exclusion that continue to exist in the region. It is coordinated around three major lines of work: the convergence of social objectives and targets and their follow-up and evaluation by Community bodies; a series of projects referring to a broad range of themes and some of which are already under execution; and horizontal technical cooperation. Attentive to the principle of subsidiarity, the IPSD intends to neither duplicate nor replace policies or actions for which the countries themselves are responsible. For that reason, the Plan contains only initiatives on a subregional scale that seek to add value to national efforts and help define a Community social horizon.

It is also important to point out that most of the projects that are included are aimed at the formulation of common policy criteria through analysis and educated debate; the organization of networks of pertinent social actors for each of the themes; cooperation and coordination among policy-makers; the examination, dissemination, and exchange of social policies and programs; and the execution in the field of some demonstration projects that can be replicated. Horizontal technical cooperation and the follow-up on and evaluation of shared social objectives and targets will be decisive in helping develop common social policy criteria.

In keeping with the conception of poverty and social inequity as multidimensional phenomena with multiple causes addressed by the IPSD, the initiatives that are proposed go beyond social policy “sector” approaches and seek to integrate social, economic and development policies. For that reason, the Plan contains proposals ranging from employment and labor rights to sustainable use of biodiversity resources, through health, education and culture, rural development, food security and development of border regions.

Within the context of these actions, attention should be drawn to the important work done today by the Regional Andean Health Body – the Hipólito Unanue Convention, in carrying out Community-wide, high-impact actions and initiatives, such as the successful negotiation to reduce the price of antiretroviral medicines to treat HIV-AIDS by 72% and the very recent start-up of an ambitious malaria control program in border areas of the Andean countries.

It is also important to underscore the contribution made by the IPSD to the incorporation of new social actors into the integration process. In order to coordinate its start-up, the Andean Council of Ministers of Social Development (CADS) was created in 2004. National IPSD Committees were also set up in each Member Country, consisting of all of the State bodies responsible for the various subject areas covered by the Plan, academic institutions and social organizations. These committees are in charge of development and implementation of the projects and to that end should ensure both effective coordination among the national bodies involved in social issues, and their link to the Andean subregional process.

At the same time, the General Secretariat is expediting the creation of a Subregional Network of academic institutions and social organizations to support the execution of the IPSD and of the Social Agenda as a whole, through both a contribution to the analysis and discussion of the projects and support for their execution.

The Andean Working Group on Indigenous Peoples, created in 2002 to promote the full exercise of the rights of indigenous peoples, is also called upon to be a key player in the implementation of the core tasks of the IPSD, particularly the development of interculturality, sustainable use of biodiversity resources, rural development and the food security program, among other things.

In addition to the importance of the IPSD and its projection, which we have described, this initiative of our Presidents should be situated within the framework of a broader purpose: to recover the dimension of socially inclusive development for the Andean integration process.

This aim, outlined at the Quirama Summit (2003), was subsequently ratified and enriched at the Quito (2004) and Lima (2005) Summits, which provided specific guidelines to promote social cohesion through joint national action to encourage decent work and boost the competitive development of small and medium-sized enterprises, within a vision of territorial development and the reduction of disparities among regions and countries.

It is also important within this context to emphasize the impetus given at the two meetings held thus far of the above-cited Andean Regional Conference on Employment, to the debate about worthy and decent employment and the need to make this objective a public policy priority.

The Strategic New Design for the integration process, approved by the Presidents at the Quito Summit, envisaged the Community project as an inclusive process and for that reason today actions are planned to “move upward” --in other words, starting with subnational actors and their recognition as first level political and economic actors. With this criterion in mind, Andean integration today is advancing a proposal for territorial development as an option for our countries’ competitive participation in a world economy resting on strong local and regional economic foundations.

Authorities and technical bodies of Andean cities and regions are actively involved in implementing this proposal through the Andean Advisory Council of Municipal Authorities created in 2004. Appropriate coordination between the CAN General Secretariat and the Andean Cities Network, in which over 300 of the subregion’s mayors participate, contributes to the guidelines that are drawn on this front.

In order to give the agenda for cooperation between Andean cities and regions a strong grounding, the Committee on Small and Medium Industries has been reactivated and its convening and initial actions conserve the local and regional economic development approach.

Work is moving ahead today on the adoption of Andean Bylaws for SMEs in order to harmonize national measurements and define the common policy sphere for this sector. Noteworthy advances have been made in forming an Andean Guarantee System as a mechanism to ensure that credit is made available to SMEs in all of the subregion’s countries. We, likewise, intend to boost strategies for technological innovation targeting SMEs, as a contribution from the vantage point of the integration process toward building up social capital in Andean territories and to encourage local socially cohesive competitiveness.

The IPSD, together with the advances made in the Andean debate on employment policy and the boosting of small and medium enterprise development with a territorial approach, are the three pillars for the Andean Community General Secretariat’s proposed contribution to the progressive building of a Community strategy of social cohesion and development.

Social cohesion has been a shared priority of the European Union and Latin America and the Caribbean as of the EU-LAC Guadalajara Summit of Heads of State. Although this would tend to indicate identical visions and values, social cohesion, both as a concept and as an objective, has different connotations for the two regions. For the Andean region, a socially cohesive development strategy must necessarily come to grips with at least four major challenges:

The actions we have been taking have pointed up the need for Andean integration to address the following tasks in order to meet these challenges:

Dear friends:

I am deeply convinced that more than 30 years of close relations between the Andean Community and the European Union constitutes an important binding element for our integration project. We are bound to Europe by historical ties that today have been renewed as a result of our joint commitment to the defense of human rights, democracy, multilateralism and multipolarism.

It is therefore our responsibility on the world scene of the next few years to deepen this alliance in the form of a strategic association, in order to bring to our Andean subregion the important advances made by the European Union in the areas of development and social cohesion, and to help build more integrated and democratic societies that should constitute the foundations for the better world to which we all aspire.

Thank-you very much.