Chile’s macroeconomic stability is obviously important, but it cannot be the sole foundation of our country’s international competitiveness. To be successful, a country must make full and creative use not only of its economic advantages, but also of its political, social and institutional resources.

That is what Chile is doing. For many years now, our country has been renowned for its consistent economic policies and sustained growth. But its present development strategy is also based on the conviction that only a socially integrated country has the power to triumph in international markets.

President Ricardo Lagos has been emphatic in underlining this essential characteristic of the spirit of Chile’s national development. We know the key to success lies in achieving the right balance between, on the one hand, increased political and social freedom and broad-based social integration and, on the other hand, our commitment to economic development. Only this balance will allow Chile to successfully meet the challenges and opportunities of globalization.

Chile boasts solid institutions that are respected by all sectors of society, as well as a strong and efficient legal system that guarantees clear rules. The rights and liberties of both individuals and businesses are enshrined in Chile’s political and social system.

In addition, Chile is aware of the ongoing need to promote justice, to provide social protection for those who have the misfortune to be unemployed, and to ensure that educational standards are of a level that permits the country’s goods and services to compete successfully in international markets.

Chile’s human resources are crucial for the country’s development. The 2002 National Census, the results of which were published in March 2003, showed a radical improvement in our citizens’ quality of life. Vast progress is evident, for example, in education. The percentage of the population with higher education increased from 9.0% in 1992 to 16.4% in 2002, while the number of professionals, scientists and technicians increased by 124% to over 1.1 million, out of a total population of 15.1 million. The Census also revealed the increasing prosperity of Chilean families. By 2002, almost three-quarters of homes were owned by their occupants. Similarly, more than half of all households had a fixed-line or mobile telephone and a fifth owned a computer.

Concrete examples of Chile’s development strategy, which harnesses the efforts of different national institutions, abound. The political and judicial authorities are, for example, collaborating in a reform of criminal justice that makes for speedier court proceedings and facilities the settlement of disputes. At present, this new system is operating in a quarter of the country but, in December 2003, when four more regions are due to make the switch, this will rise to 60%. The process will conclude in December 2004 when Greater Santiago, the home of 40% of the country’s population, is scheduled to go over to the new system.

Similarly, business and trade union organizations, as well as Congress, worked together with the government to design an unemployment insurance scheme that was launched in October 2002. Financed jointly by firms, employees and the State, the scheme combines protection from the economic effects of unemployment with incentives for reinsertion into the labor market. By March 2003, almost 1 million people were covered by the program.

Another example of Chile’s development strategy is a reform of healthcare that began to be implemented in 2002. This aims to increase the efficiency and availability of care for all sectors of society. As part of this reform -and in one sign of its commitment to social integration- the government has decided to provide free healthcare for senior citizens.

A Pro-Growth Agenda, launched in October 2001, is a key roadmap for the Economy Ministry. This unique example of collaboration between the public and private sectors was designed in conjunction with the Chilean Federation of Industries (SOFOFA) and identifies eight priority areas of action: pro-competition regulatory improvements, technology policy, the tax system, capital markets, efficiency in fiscal spending, labor laws, the reduction of bureaucracy and the development of exports.

In 2003, we hope that Congress will approve new regulation for the fishing industry, complementing legislation that was introduced in late 2002. This will give the private sector responsibility for the research needed to determine sustainable catch limits and to guarantee the future of Chile’s third most important industry. Another priority for 2003 is the modernization of electricity industry regulation. This is crucial to maintain the level of investment required to sustain Chile’s economic growth over the next ten years.

To sum up, the opportunities that Chile offers for creating wealth are not only the result of its economic merits. They are also grounded in mechanisms for resolving disputes, which guarantee transparency and justice in such a way as to ensure long-term social harmony.

In recent years, Chile has achieved important social progress, but this is an ongoing task. We are committed to the growth of Chile and of its people.