Speech by President of the Republic of Finland Tarja Halonen at the Chilean-Finnish Business Forum in Santiago de Chile, November 5th 2003

Prospects for trade and economic co-operation between Finland and Chile

Let me warmly thank esteemed Mr Ricardo Lagos, the President of the Republic of Chile of his great interest and activity in developing ever deeper and closer relations between our countries.

I would also like to congratulate Mr Juan Claro and Mr Juha Rantanen, the co-chairmen of the Chilean-Finnish Business Forum, for holding a joint Business meeting today. I extend my gratitude to them and to their respective business communities for their interest and work to foster and widen business relations and cooperation between our two countries.

There is a long tradition of good political and economic relations between Finland and Chile. On the global level we participate in multilateral co-operation for example in the United Nations and as as members of the World Trade Organisation. On the regional level we have the European Union-Chile framework and association agreement and then of course we have excellent and long-standing bilateral relations.

Chile is in many ways the country setting an example in South America both politically and economically and thus of great importance to Finland. Chile is a dynamic economy and a genuine free trader. Chile, like Finland, exercises open and active approach towards regional integration and stability and plays an active role in the multilateral context promoting stability globally and regionally.

For Finland the breakdown of the talks at the WTO ministerial conference in Cancún was very disappointing. Every country lost in Cancún. Our major concern is, however, that the poorest and the weakest countries will suffer most from this failure. The strongest will always find ways to promote their interests in the world trade. We can pursue on both tracks, multilateral liberalisation as well as complementary bilateral and regional arrangements to search for deeper commitments and trade liberalisation measures going even further. However, the evident focus of many countries towards bilateral trade agreements can only be the second best option to multilateral solutions. Developing countries are the ones that should benefit most from trade liberalisation and multilateral arrangements.

Despite the present difficulties, Finland remains hopeful and strongly committed to pursue Doha Development Agenda. In this spirit we wish all parties to flexibility and commitment to achieve a comprehensive agreement. The major players – EU, USA and G21 - need to intensify their efforts and listen carefully and patiently to those developing countries that are concerned about further liberalisation of their markets, to bring about a more focused agenda for the WTO and to seek overall progress in the process already in the foreseeable future.

The lessons of Cancún must be taken seriously. The challenges facing us are sizable. I am an optimist at heart, however, and I believe that we can find our way forward. Globalization will in any case continue and the best way to govern it is multilateral agreements. In the work of the World Commission on the Social Dimension of Globalization, which was established by the International Labour Organization, President Benjamin Mkapa of Tanzania and I as co-chairmen have learned that the absolute precondition for governing globalization is cooperation. Our commission includes representatives from different areas of life around the world. We hope that our report at the beginning of next year will help achieve a fairer globalization which corresponds to people's needs and underlines the importance of employment.

Finland’s membership in the European Union has improved opportunities for co-operation between Finland and Chile. EU and its member countries are the largest investor and trading partner for Chile. Strong EU-Chile partnership reflects the importance of Chile for Europe. Respect for democracy, human rights and the rule of law, as well as promotion of sustainable economic, social and environmental development form the fundamentals of our strategic partnership. There is also a strong will of both parties to further strengthen the relationship in the future.

As an excellent example of this will, the association agreement between EU and Chile was negotiated successfully in a very tight schedule. It is an ambitious and innovative agreement that covers the main aspects of the EU-Chile relations, i.e. the political relations, the trade relations and cooperation. It entails significant benefits for both Finnish and Chilean companies in the form of increased trade and co-operation and I am pleased that the business communities of Chile and Finland so strongly supported this agreement. The free trade part of the agreement is certainly the most important and concrete element of the agreement for the business community. Political dialogue has also an important influence on our trade relations. I am convinced that democratic, free and stable societies are the best to make profitable business with. The agreement foresees also development of cooperation in many new sectors, which also are relevant to the business community.

Adoption of this agreement entails significant benefits for both Finnish and Chilean companies in the form of increased trade and co-operation and enhancing their competitiveness both in each others’ as well as on third markets.

Then we have our bilateral level, which is of course from the companies’ point of view the most concrete one. I do not, however, want to go into details in this respect as you have already spent the whole morning discussing these issues. I would just like to mention briefly that our trade relations have developed very favourably especially during this year and Chile during the first seven months of Chile has risen past Brazil as our major export country in Latin America.

There are extensive future possibilities for Finnish and Chilean industries in many sectors, including information and communication technology, forest industry and forestry, energy sector, metallurgical industry as well as several sub-sectors of engineering industry. Today’s Business Forum here in Santiago has served as an excellent platform for contacts between business leaders and expanding business relations and company networking between Finland and Chile.

The Finnish government and companies work closely together in order to develop trade and economic co-operation with Chile on a long-term perspective. Our business communities are in active and regular contacts with both our governments. In this positive spirit I hope my state visit, as the President of Finland to Chile will further strengthen the political and economic relations between our countries.