Chile returns to CAF

(Caracas, July 16, 1991).- In response to a cordial invitation from the five presidents of the member countries of the Andean Group (Bolivia, Colombia, Ecuador, Peru and Venezuela), Chilean President Patricio Aylwin announced yesterday (July 15) in Bogota that his country would reenter CAF as shareholder.

President Aylwin – who is on an official three-day visit to Colombia - announced the decision to the president of that country César Gaviria at a banquet in his honor held last night in Casa de Nariño, the presidential palace.

In his remarks, the Chilean president said CAF was the "true financial engine of integration" and its work in recent years had converted it into a multiple institution "whose core operations as a development bank are strengthen by its support and opening to the private sector and the introduction of advanced technology into the productive system of the Andean countries."

"By opening its doors to Latin American nations - Alwyn said - CAF is demonstrating its continental vocation with actions, which makes it doubly pleasing for me to announce in Colombia, cradle of subregional integration, my government’s decision to subscribe to "C" series shares. This demonstrates the faith of my country in the unifying ideals and the need to transform them into "pragmatic and beneficial truth for our peoples," he added

Asked by reporters if the announcement meant the possible reentry of Chile into the Andean Pact, Alwyn said that progress was being made in this respect. "We are talking about integration, of moving forward realistically on this path. As part of our commitment to this objective, we have decided to return to our association with CAF.

Series "C" shares The CAF series "C" shares are reserved exclusively for extra-subregional countries interested in collaborating with Andean integration, doing joint business and promoting investments and technology exchange between the nations involved. Mexico was the first country to subscribe to this type of share in October 1994 for US$20 million.

Chile’s entry into the CAF capital is especially important for continental integration, given that all Latin American nations are in favor of the creation of free trade zones, and they are - as never before – committed to stimulating a practical integration process, without rhetoric, which leads to a common market.

Pioneer country When Eduardo Frei was president of Chile in the late 1960s, the country held an important position in subregional integration. Frei together with then Colombian President Carlos Lleras Restrepo was a leading promoter of the process, and Chile was one of the signatories of the CAF Establishing Agreement on February 7, 1968. Later, in 1976, the country decided to withdraw from the Andean Pact, after questioning its economic model.

On hearing the news, CAF President & CEO Galo Montaño said, "the Chilean decision will further strengthen regional integration, through CAF’s actions to promote increased trade and joint ventures between Latin American businesses." He emphasized the recognition that President Aylwin had given to the Corporation’s work, which has resulted in international prestige, obtaining lines of credit in developed countries for over US$500 million, and placing of bonds on international financial markets.