Chile border dispute lingers, Peru says

Presidents Alejandro Toledo of Peru, left, and Ricardo Lagos of Chile signed seven agreements during Toledo's two-day state visit but the border issue remained.

SANTIAGO, Chile (Reuters) -- Peru said Friday it had one remaining border dispute with neighbor Chile despite a 1999 pact resolving all territorial conflicts dating back to a 19th century war.

During his first official visit to Chile, Peru's President Alejandro Toledo said the two nations disagreed on the location of a maritime dividing line that extends westward into the Pacific Ocean at about the same latitude as their land border.

"The issue of the maritime limit is a problem that belongs to the past, but it is there," Toledo told a news conference at the end of a two-day stay.

"We have informally talked about the issue and we have an interpretation that differs from that of Chile," he added.

Chile seized a swath of territory from Peru in an 1879 war. It also took Bolivia's access to the Pacific Ocean in the same war, leaving the country landlocked.

Chile and Peru eventually settled their territorial claims in a 1929 treaty, including maritime limits. But it was not until 1999 that they formally agreed to put their border conflicts behind them for good.

Many Peruvians still feel strongly about reclaiming waters they believe historically belong to them.

Fishing is Peru's second-largest foreign cash earner, after mining. The country is the world's biggest producer of fishmeal.

In reaction to Toledo's comments, Chilean President Ricardo Lagos said he did not see the border issue as a major stumbling block in peaceful bilateral relations.

"If we remain stuck to these topics, we're not going to devote ourselves to the things we should be doing," Lagos told reporters.

In his two-day visit, which ends on Thursday, Toledo appealed to Latin American governments to cut military spending to free up more money for social programs.

Chile has unsettled some of its neighbors, including Peru, with plans to buy 10 F-16 warplanes from the U.S. defense contractor Lockheed Martin for $660 million.

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