Peru's President Garcia Arrives in Spain in Bid to Improve Trade, Diplomatic Relations

Peru's President Alan Garcia landed at Madrid's international airport Sunday for a three-day visit aimed at improving business and diplomatic links with Europe.

The Peruvian leader is due to meet with King Juan Carlos, Prime Minister Jose Luis Rodriguez Zapatero and business leaders.

Garcia was re-elected in April 2006 on a promise to improve his Andean country's economic fortunes.

Garcia's first 1985-90 term was plagued by hyperinflation and food shortages at the height of a brutal war against Maoist Shining Path guerrillas.

Peru's economy grew 8 percent in 2006, the eighth consecutive year of expansion for the Andean nation of 27 million people, and Garcia has forged ahead with a market-friendly agenda.

Last week Garcia told journalists that Spanish-Argentine oil giant Repsol YPF SA had found 2 trillion cubic feet of natural gas in Peru's Amazon jungle, enough to guarantee the country's needs for 40 years, he said.

U.S. President George W. Bush signed a U.S.-Peru free trade agreement with Garcia in December, paving the way for stronger bilateral economic ties.

Garcia is also likely to seek Spain's diplomatic support for his government's claim to draw Peru's sea boundary in waters claimed by southern neighbor Chile.

Peru asked the International Court of Justice in The Hague, Netherlands, on Wednesday to adjudicate on the boundary, inflaming poor relations with its southern neighbor and angering Chile's President Michelle Bachelet.

Peru contends its maritime border with Chile has not been legally defined, while Chile says the border was set by treaties with Peru in 1952 and 1954. Peru argues the agreements dealt with fishing rights, not borders.

There is strong anti-Chilean sentiment in Peru because the country lost a large chunk of its southern territory to Chile in a war in 1879.