Joint Declaration of the Presidents Following Their Meeting in San Salvador.

JOINT DECLARATION OF THE PRESIDENTS OF THE REPUBLICS OF CENTRAL AMERICA AND

THE PRESIDENT OF THE UNITED STATES OF AMERICA

I.

The Presidents of El Salvador, Costa Rica, Honduras, Nicaragua and Guatemala met at the headquarters of the Organization of Central American States (ODECA) in San Salvador, Republic of El Salvador, on July 5, 1968, in order to examine the status of the Central American integration program and to adopt measures aimed at speeding up the economic and social development of their countries and of Central America as a whole.

Being aware of the keen interest that Lyndon B. Johnson, President of the United States, has manifested in the economic and social development and the integration of Latin America, the Presidents of the Central American Republics had the honor of inviting him to meet with them on this occasion. The purpose of the invitation was to exchange impressions with President Johnson on the progress achieved by the five countries in accordance with the guideline and commitments contained in the "Declaration of the Presidents of America" adopted at Punta del Este, Uruguay, in April 1967, as well as on the current problems of the region and the measures that the Presidents of the Central American Republics have adopted to solve those problems.

The joint meeting was held at the ODECA headquarters on July 6, 1968.

II.

The Presidents of the Central American Republics reviewed during their meeting of yesterday, July 5, the progress achieved in the multi-lateral movement of their countries toward integration. In this connection, they stressed the fact that as a result of the efforts made over a period of several years, the Central American countries now have a legal and institutional framework for giving impetus to the process of reconstructing their regional unity; in 1951, through the Charter of San Salvador, they founded the Organization of Central American States; and seven years ago, they established a Common Market that is already at a very advanced stage. Within that process, a complex of political, legal, cultural, educational, economic, social and technical institutions has been set up whose activities together constitute an integral movement toward unification.

Thus, it can be noted that: In less than seven years, trade between the five member states has increased by almost 700 percent, with an equally impressive increase in the size of the investments generated by the Common Market.

The figures for the increase in per capita income that prevailed until recent years have been, for certain member countries, largely the result of the integration process.

In addition to providing a framework for cooperation to its member states in the political field, the Organization of Central American States (ODECA) has, through its organs and its General Secretariat, done valuable work in the cultural, educational, research, legal coordination, public health and labor fields. Likewise, it has carried out important specific programs, such as providing millions of textbooks to elementary school children in the five countries; regional coordination of the efforts to eradicate malaria; providing basic health services to more than a million families in rural areas; initiating efforts to harmonize labor legislation and social security services; and promoting personnel training activities.

The Economic and Executive Councils and the Permanent Secretariat (SIECA) have succeeded in nearly completing the organization of the Central American free trade area and the adoption of a uniform tariff on imports; have begun the coordination of industrial and agricultural development; enforced the regulations governing the Common Market; established the basis for coordinated programming of economic and social development; and promoted a common policy for protecting the balance of payments, fostering trade relations with other countries and harmonizing tax systems.

The Central American Bank for Economic Integration (CABEI), as the financial organ of the integration process, has already mobilized resources totaling more than 200 million Central American pesos (equivalent to U.S. dollars) and has rendered assistance in such important fields as the promotion and financing of multinational private industries, housing for middle-income families, and specific projects for establishing the physical infrastructure required by regional economic unity, particularly with respect to roads and telecommunications.

The Central American Economic Integration Fund of the Central American Bank to which the Central American countries, the Inter-American Development Bank, and, to a much greater extent, the Government of the United States, have contributed, has made it possible to meet the financing requirements of major infrastructure projects, in particular the roads forming part of the Central American highway system.

The Central American Monetary Council, established to coordinate the policy of the central banks of the member countries, has expanded the multilateral compensation mechanism, adopted regulations to expedite the movement of funds and capital within the region, and has begun to establish the basis for a Central American monetary union.

The Central American Institute of Industrial Research and Technology (ICAITI) has contributed to the development of the area through feasibility studies of new industries of regional interest, technological research on the most advantageous use of natural resources, and technical standards for products and raw materials, and it is also seeking to adapt the advances of modern technology to the situation of the Central American countries.

The Central American University Council (CSUCA) is striving to create a modern university system for the region and has sponsored programs to improve the teaching of the physical and social sciences and to establish regional specialized schools.

The Central American Institute for Public Administration (ICAP) has contributed to the training of public officials and has provided technical assistance to the member countries for the improvement of their administrative systems, in keeping with the needs of integration.

The achievements of integration are primarily the result of the internal effort carried out jointly by the people and governments of the five Central American countries. The Presidents of Central America recognized that the responsibility for the success of the integration process rests on internal effort. However, they believe because of the international technical financial cooperation that Central has received in the last few years, the advances made have been greater than they would otherwise have been. In this connection, the cooperation given by the Government of the United States of America through the Alliance for Progress should be stressed.

III.

The Presidents of Central America realize that, notwithstanding the substantial progress made in the integration and economic and social development of their countries, there are still great obstacles that must be overcome.

In the economic field, the increase and diversification of exports have been insufficient during the last few years to sustain a satisfactory and stable growth process; industrial and agricultural policies have not reached the necessary level of coordination and adaptation to the new situation in Central America; progress made with respect to the free movement of capital and persons in the area is limited; tax systems have not yet been properly adapted to the needs of the countries; and the difficulties encountered in financing national and regional development are a matter of concern.

In the social field, much remains to be done to increase the participation of low income groups in national life and the integration process. It is essential, among other things, to increase educational and health improvement facilities, and to overcome the limitations affecting housing programs.

In the legal field, integration requires new instruments to give flexibility and drive to its progress and administration. Moreover, there is a large task still to be accomplished in order to harmonize and standardize the legal structure of the member states.

Keenly aware of the need to act urgently to resolve those problems, the Central American Presidents, during their meeting of July 5, took the decisions that appeared annexed to this document, among which the following merit special mention:

1. To give their full support to the measures agreed upon by the Economic Council, the Monetary Council, and the Central American Ministers of Finance to protect the balance of payments, and to take all steps within their power to put those measures into effect within the stipulated period;

2. To seek the prompt entry into force of the Central American Agreement on Tax Incentives and the protocol thereto;

3. To support the measures adopted by the Central American Monetary Council to achieve adequate harmonization of national monetary policies, and the studies required to establish the Central American Monetary Stabilization Fund;

4. To encourage the expansion and diversification of agricultural production for domestic consumption and foreign markets and to adopt an industrial policy that will be consistent with the needs of domestic and foreign demand and better coordinated at the regional level;

5. To support measures that will make it possible to complete and improve the Central American Common Market with respect to tariff equalization and the free movement of goods;

6. To accelerate the completion in successive stages of a Central American Capital Market, and the adoption of measures to facilitate the free movement of persons;

7. To recognize the special importance of the regional telecommunications program, as well as the joint utilization of electric power resources and the merging of the various systems into multinational networks, committing themselves to strengthening the resources of the Central American Economic Integration Fund, which constitutes the basic instrument for building the physical infrastructure of the region;

8. To provide the regional integration institutions with the necessary resources to meet their growing responsibilities;

9. To reaffirm their staunch support of the formation of the Latin American Common Market, and of the development of economic bonds between Central America and other countries and subregional groups;

10. To intensify their efforts to achieve steadily growing participation by the less privileged rural and urban populations in the benefits of development and integration;

11. To give more attention to educational programs for the rural population and, in general, to low income groups, in order to raise their educational level and achieve their full participation in the benefits of economic and political democracy;

12. To pursue with renewed vigor the programs to eradicate those diseases against which effective preventive measures exist; to continue the struggle against child malnutrition; to improve environment conditions; and to strengthen national health services through regional coordination; and

13. To introduce adequate reforms in the legal and administrative structures of the Organization of Central American States, in order to give it the drive that regional development demands and to strengthen its various activities, with a view to maintaining proper balance in the development of integration and promoting reforms in the domestic legislation of the member countries that will expedite the implementation of the common objectives being pursued.

IV.

The President of the United States of America expressed his satisfaction at having the opportunity to meet once more with his Central American colleagues and to review with them the progress made in the region in the past few years, particularly since the meeting of American Chiefs of State held at Punta del Este, Uruguay, in April 1967.

He reiterated his support for the integration movement in Latin America generally and in Central America specifically. He expressed admiration for the progress achieved by the Central Americans, and, as he has done on previous occasions, he stated that the Central American integration movement is one of the most advanced in the world, and constitutes a model for other developing areas.

President Johnson showed special interest in the proposal to establish a Central American Monetary Stabilization Fund and indicated that he was convinced it would be an important step toward a monetary union in the context of integration. He said that his Government would carefully and sympathetically study in coordination with the competent international organizations the proposal for the Fund in order to determine the manner in which the United States could cooperate in its formation.

Together with the Central American Presidents, he examined in detail the problems that the region still faces in the social and economic fields, and the measures that the governments are proposing to take to solve those problems. In this connection, he lauded their decision to intensify their efforts in matters of education and health.

He took note of the important role being played by the regional integration institutions and the intention of the member states to provide them with adequate resources in order that they may develop satisfactorily. He indicated his agreement with the high priority which the Central American Governments have assigned to the creation of infrastructure projects, including the regional telecommunication network, all of which are basic to the area's economic development. He also noted with satisfaction the way in which the Central American Governments have selected the projects to be financed, evaluating them on a basis of regional priority.

He also expressed confidence that the efforts being made by the Central American Governments would contribute in the near future to accelerating their programs of agricultural diversification. He analyzed the serious problem he had in maintaining support of the International Coffee Agreement, both because of the domestic impact of the Agreement on the American consumer and because of the limited progress in some exporting countries toward adjusting production to demand.

The President of the United States recognized that the five countries forming the Central American community can perfect their union only on the basis of processes of development in all the member countries, and he agreed that every government has a special responsibility for the welfare of its people, and that this can only be achieved in Central America at both the national and regional levels. He acknowledged that the financial costs of social progress are high and that the developing countries must make great sacrifices to achieve it, and he stated once again that in such cases the United States was prepared to give it unequivocal cooperation.

The President pledged the continued support of the United States of America for the Central American integration process, recognizing that overcoming the problems enumerated by the Presidents of Central America required not only sustained national efforts but also substantial levels of foreign assistance. He referred to the United States commitment, made in the Declaration of the Presidents of America, to the movement of Central American economic integration, reaffirming it, and to that end he authorized the negotiation of new loans to Central America totaling $65 million.

V.

The Presidents of the Central American States expressed their recognition of the United States' support of the Alliance for Progress, which reflects the most advanced Latin American thought in the economic and social fields; and they emphasized that the United States had continued its support despite its serious balance-of-payments problem.

They emphasized President Johnson's efforts to give continuity to the International Coffee Agreement and to establish the Coffee Diversification Fund; his active position in favor of the establishment, by the industrialized nations, of a general system of unilateral and nondiscriminatory tariff preferences for the developing countries; and his efforts to prevent the adoption of restrictive measures on Latin American exports.

Finally, the Presidents of the Central American Republics and the President of the United States of America expressed their awareness of the magnitude of the task to be accomplished; that the programs to be carried out represent only a beginning, and that if the basic changes which are the primary objective of the Alliance for Progress are to be achieved, all sectors of society must cooperate in this effort. In this connection, they called upon their citizens to unite with them in their new commitments and to try to reach together the final goals of political democracy, economic development, and social justice.

In testimony whereof we sign the present Joint Declaration, two authentic originals in the Spanish language and two authentic originals in the English language, one of which, in each language, remains in the hands of the President of the United States of America and the other at ODECA's General Secretariat.

The Organization of Central American States, San Salvador, June, sixth, nineteen hundred sixty eight.

CNEL. FIDEL SANCHEZ HERNANDEZ,

President of El Salvador

Ltc. JULIO CESAR MENDEZ MONTENEGRO,

President of Guatemala

GRAL. ANASTASIO SOMOZA DEBAYLE,

President of Nicaragua

LYNDON B. JOHNSON,

President of the United States of America

PROF. Jose JOAQUIN TREJOS F.,

President of Costs Rica

GRAL. OSWALDO LOPEZ ARELLANO,

President of Honduras