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Andean Community is a trade bloc comprising the South American
countries of Bolivia, Colombia, Ecuador, Peru, and Venezuela. Chile was a
part of the trade bloc but the country has dropped out.
Since January 1, 2005, the citizens of the member countries can enter the
other Andean Community member states without the requirement of visa. The
passengers should present to the authorities their national ID cards.
Recently, with the new cooperation agreement with Mercosur, the Andean
Community gained four new associate members: Argentina, Brazil, Paraguay
and Uruguay. These four Mercosur members were granted associate membership
by the Andean Council of Foreign Ministers meeting in an enlarged session
with the Commission (of the Andean Community) on July 7, 2005.
Bolivia (top)
Bolivia is an associate partner of the Mercosur and a member of the
Andean Pact. Owing to these arrangements, the country is becoming an
increasingly important transport hub.
Increased exploration activity and investment by oil companies have
rapidly increased Bolivia's proven oil reserves, which presently amount to
440 million barrels. The Brazilian state-owned oil company Petrobras holds
41% of the country's proven oil reserves however the company seeks foreign
investment . .
Buenos Aires, Argentina has agreed to pay 50% more for Bolivian natural
gas and the two countries have signed a deal to triple export volumes. The
government has also renegotiated contracts with the major oil companies
operating in Bolivia. Foreign oil companies invested US$900 million in
2008 .
In 2005, Congress approved a new Hydrocarbons Law that levies an
additional 32% tax on oil and gas production at the wellhead, on top of
the existing 18% royalty. The law also calls for the compulsory conversion
of existing contracts to the terms of the new law .
Soybeans are a major cash crop, along with wood and sugar. The country
seeks further foreign investment to development this market.
Bolivia is the world's largest producer of tin and has deposits of copper,
lead, silver, zinc, antimony, wolfram and gold. Government officials also
claim that Bolivia possesses the world's largest reserves of lithium. They
predict the country will earn large profits as automakers push to develop
electric cars that will run on lithium ion batteries. A pilot plant to
extract lithium will begin operation in 2010. Another major project to
extract iron ore deposits is also underway in south-eastern Bolivia. The
site is estimated to hold 40 billion tons of iron ore, the largest
untapped source in the world .
Colombia (top)
When the Colombia Free Trade Agreement (FTA) with the United States
enters into force, Colombia will immediately eliminate most of its tariffs
on U.S. exports, with all remaining tariffs phased out over defined time
periods. U.S. firms will have better access to Colombia's services sector
than other WTO Members have under the General Agreement on Tariffs and
Trade. This FTA is sometimes referred to as a Trade Promotion Agreement
with the two countries.
Colombia, mining, mainly coal and oil, is one of the country's most
important sources of exports. Colombia completed the privatization of its
coal sector in 2004 with the closing of Minercol, the former state-owned
coal company. The largest coal producer in the country is the Carbones del
Cerrejon consortium, composed of Anglo-American, BHP Billiton, and
Glencore. It is likely that Colombia’s coal production will continue to
increase in coming years, as exploration and profitable developments
continue throughout the north and interior of the country. Oil is the
major legal export commodity of Colombia. The country has 1.45 billion
barrels of proven oil reserves. These deposits represent the fifth-largest
in South America . An ambitious investment program in existing facilities
is underway.
The banking system has undergone significant privatization since the last
financial crisis in 1999. Only one state-owned bank remains in operation.
Corporate income taxes have been cut and other small taxes eliminated.
Structural reforms continue to advance as authorities strengthen the
financial system. More consolidation through mergers and acquisition is
expected.
Colombia forms the geographical link between Central and South America and
creating ease of trade and transportation. Meeting the Isthmus of Panama
in the west, it is bordered on the south by Ecuador and Peru, and on the
east by Venezuela and Brazil, and has coastlines on both the Caribbean and
the Pacific.
Ecuador (top)
The country is a member of the Organization of Petroleum Exporting
Countries (OPEC), which secures an efficient, economic and regular supply
of petroleum to consumers, a steady income to producers and a fair return
on capital to those investing in the petroleum industry.
The state-owned oil company, Ecopetrol, hopes to invest US$12.5 billion in
2007-2011 to step up exploration, production and boost refinery capacity.
Ecuador also has 345 billion cubic feet (Bcf) of natural gas reserves but
lacks much of the infrastructure to develop this energy source .
Foreign investment has grown throughout most of this decade and the
current account is in surplus. The government has announced its intention
to renegotiate all contracts with foreign oil producers. The goal is to
increase the state’s share of production in private projects to 50% from
the current 20%.
Ecuador has 3.8 billion barrels of proven crude oil reserves with a
significant portion remains virtually untapped in the
Ishpingo-Tiputini-Tabbococha fields.
Peru (top)
The country is a member of APEC, which is the premier Asia-Pacific
economic forum with the primary goal to support sustainable economic
growth and prosperity in the Asia-Pacific region.
The United States and Peru signed the United States-Peru Trade Promotion
Agreement (PTPA), which resulted in significant liberalization of trade in
goods and services between the United States and Peru. Under the PTPA,
Peru immediately eliminated most of its tariffs on U.S. exports, with all
remaining tariffs phased out over defined time periods. The ratification
of this free-trade agreement with the USA should help to bolster
competitiveness.
Mining already provides more than half of all exports and accounts for
around 30% of total tax revenues. Gerdau of Brazil plans to invest US$1.4
billion to boost production of its steel facility, which is mainly for
export. Another Brazilian firm is spending US$500 million to expand zinc
output. Development of five Chinese mining projects is proceeding despite
the weaker global economy. In addition, foreign investors plan to spend
nearly US$3 billion developing hydroelectric facilities. The country has
vast mineral potential, with deposits of copper, silver, zinc, gold, iron
ore, phosphorus and manganese .
Manufacturing is widely diversified, with rubber, vehicle assembly,
engineering, food processing and chemicals being the most prominent. The
government has signaled that it intends to promote textiles and woolen
products, particularly for fine wool from alpacas, llamas and vicuña.
Peru's agricultural sector employs about 40% of the workforce. Most
farming is for subsistence but the sector is also an important earner of
foreign exchange and continuously seeking foreign investment.
The government has adopted measures to lower distortionary taxes and
exemptions and to improve the quality of public spending. Tariffs were
also lowered marginally. The country has an open and transparent
investment regime. A one-stop window for trade transactions is now
operational.
Tourism employs 6.8% of the work force and its share in GDP is
approximately 7.7%. To expand this sector, the country seeks foreign
investment for items such as infrastructure.
Venezuela (top)
Venezuela is a member of Mercosur, the trade bloc consisting of Brazil,
Argentina, Paraguay and Uruguay.
It is a member of the Organization of Petroleum Exporting Countries
(OPEC), which secures an efficient, economic and regular supply of
petroleum to consumers, a steady income to producers and a fair return on
capital to those investing in the petroleum industry.
The petroleum sector dominates Venezuela's mixed economy, accounting for
roughly a third of GDP, around 80% of exports, and more than half of
government revenues. Venezuela contains some of the largest oil and
natural gas reserves in the world .
Venezuela has 99.4 billion barrels of proven oil reserves, which is the
largest in South America. Due to the maturity of many oil fields and their
declining productivity, the state-owned oil company wants to boost its
spending to increase production at existing oil wells, as well as to
develop new non-conventional extra heavy crude oil and natural gas
resources .
Venezuela's birth rate is among the highest in South America, after
Bolivia, Paraguay and French Guyana. Venezuela is also among the most
urbanized countries in Latin America, whi
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