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Thailand, Peru Agree to Creation of Free Trade Area - 2003-10-17

Thailand and Peru have agreed to set up a free trade area by 2015 and to cooperate in the fight against narcotics trafficking and terrorism. The agreement came in Bangkok, where Peru's President Alejandro Toledo is on a state visit in advance of the Asia-Pacific Economic Cooperation summit on Monday and Tuesday. Peru's President Alejandro Toledo and Thailand's Prime Minister Thaksin Shinawatra signed an agreement Friday that paves the way for a Free Trade Area, or FTA, by the year 2015. If established, it will be the first Free Trade Agreement between Latin America and Asia.

Under the deal, both countries will gradually reduce trade barriers on investment, goods, and services. They will begin talks on eliminating tariffs next year.

Mr. Toledo says there will be mutual benefits in the areas of tourism, construction, and energy.

"We have signed a broad understanding for a free trade agreement between Peru and Thailand and we see Thailand as a hub for Asia," he said. "And I invite you to see Peru as a hub for Thailand to go into Latin America."

Mr. Toledo also says the two countries would cooperate in eliminating narcotics trafficking and terrorism.

Prime Minister Thaksin says the interim agreement on free trade will serve as the basis for a strategic partnership between the two countries.

"We both welcome the signing of the framework agreement on personal economic partnership between Peru and Thailand, which will allow the elimination of barriers to trade and goods, services, and investment between our two countries," said Mr. Thaksin.

Mr. Thaksin and Mr. Toledo also signed a cultural agreement and the Thai prime minister will pay a state visit to Peru next year.