October 18, 1999
Central American nations sign free trade pact with Chile

                  GUATEMALA CITY (AP) -- Chile joined a free trade bloc with Central
                  American countries and the Dominican Republic on Monday in an expansion
                  of the free trade zone.

                  Details of the treaty are to be disclosed in the coming weeks, but it deals
                  with agricultural exports, as well as sanitation, intellectual property and other

                  "The region must present a common front. We cannot present individual
                  proposals to important countries such as Chile," said Guatemalan President
                  Alvaro Arzu, who was hosting a summit of Central American leaders.

                  Trade between Chile and Central America is about $150 million a year,
                  most of that in exports from Chile. But regional leaders said the agreement
                  had symbolic importance.

                  "This is not just a commercial treaty, it is about a political, educational and
                  cultural vision," Chilean President Eduardo Frei said.

                  The Central American nations involved in the treaty include Guatemala, El
                  Salvador, Costa Rica, Nicaragua and Honduras. Acting as observers were
                  Belize, the Dominican Republic and Panama.

                  Summit leaders also invited Chile to join the Central Bank for Central
                  American Integration, which focuses on investment in infrastructure and
                  production in the region. Taiwan and Venezuela already are associate

                  Praising the agreement, Costa Rican President Miguel Angel Rodriguez said:
                  "Who would have thought a decade ago, with inefficient production and
                  governments with undisciplined monetary and fiscal policies, that a decade
                  later Central America would be an attractive and reliable region for

                  Guatemalan Foreign Minister Eduardo Stein said the economies of Central
                  America and Chile are compatible in part because they have differing
                  agricultural seasons.

                  Central America also is negotiating a free trade agreement with Mexico, but
                  talks have been slowed by differences over agricultural products.

                    Copyright 1999 The Associated Press.