Lundi 22 Avril 2019  

N°124 - Quatrième trimestre 2018

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  S.E.Mme / H.E. Imma TOR

Andorra: A Land Rich in History with Modern Ambitions

A decade after claiming sovereignty, Andorra continues to expand its unique role as a bridge between the cultures of Spain and France. H.E. Imma Tor, the Ambassador of Andorra to France, paints an overview of a country bolstered by more than seven hundred years of rich history as it pushes forward alongside the European Union.
The Diplomatic Letter: Madam Ambassador, 2003 marked the tenth anniversary of the Constitution of the Principality of Andorra. Could you tell our readers how claiming sovereignty has changed your country? How have Andorra’s relations with France and Spain changed since 1993?

H.E. Imma Tor: The Andorran people voted in the nation’s first written Constitution in a 1993 referendum. This set up a “parliamentary co-principality,” the culmination of six hundred years of parliamentary tradition since the Land Council was first created back in 1419. Andorra has been an independent country since the Middle Ages, but it was not until the close of the 20th century and the enactment of this text guaranteeing rights and liberties, that Andorra emerged as a sovereign State within the international order. Positive headway has been achieved on every front over the past ten years. Andorra has created a comprehensive legislative framework, streamlined the central government, and modernized its judicial system. It has staked out its place in the concert of nations, becoming a member of the UN, the Council of Europe, and the OSCE. More importantly, it has expanded and deepened its ties with its two closest neighbors: France and Spain. All three States have been linked by a Treaty of Friendship since the enactment of the Andorran Constitution. We have signed trilateral agreements regulating the movement of labor, giving nationals from all three States greater freedom of movement. Andorra has also entered into cooperation agreements with France and Spain which link the three countries’ social security systems. In accordance with current agreements in the education sector, France and Spain run part of the Andorran education system, with full respect for our national identity. Andorra has built strong ties with its neighbors by striking agreements in all areas of key importance, permitting our three States to forge extremely rich and diverse relations.

T.D.L.: As a landlocked country nestled in the eastern Pyrenees Mountains, Andorra has made the most of its bucolic setting, sparking a boom in “snow tourism” in your country. Could you tell us how Andorra turned a difficult geographic location into an asset? With tourism accounting for 80% of GDP, what is Andorra doing to diversify its economy and foster high-tech sectors and specialized industries?

H.E.I.T.: The access problems created by Andorra’s mountainous landscape have proved to be both a liability and an asset. A liability, since Andorrans had to scrape by for centuries on subsistence crops painstakingly wrenched from the mountains, and were forced to emigrate when those resources lacked. An asset, because this dearth of natural resources explains why our country has never been seriously coveted, and has managed to remain independent over the centuries. Mountainous lands were long considered a hostile environment, but in the 20th century they have become synonymous with economic development. Andorra  currently has the largest skiable area in the Pyrenees, with ski resorts that rival alpine resorts. It also offers a wide variety of other activities, such as high-end shopping at extremely competitive prices, water cures, and a bevy of chapels that are fine examples of Roman culture. Andorra is working, nonetheless,  to diversify its economy. The government is considering offering incentives that will make it easier for unimposing and environmentally friendly high-tech industries to do business in our country.

T.D.L.: Though still considered a micro-State, Andorra’s population rose to 67,000 in 2002. How do you account for the country’s strong demographic growth since the 1960s? With immigrants accounting for a high percentage of the nation’s population, are foreigners well integrated in Andorran society? As a multilingual country, has Andorra taken special measures to promote cultural diversity?

H.E.I.T.: Andorra is indeed a small country in terms of size (468 km2). The population has grown to 70,000, compared to barely 6,000 people at the start of the 1950s. This demographic explosion has been caused by a strong influx of foreign labor, especially from Spain and, to a lesser degree, from France. Andorra has traditionally been a land of agriculture and animal husbandry. Andorra entered into a commercial golden age after the Spanish Civil War and World War II, posting unprecedented economic growth. It quite naturally became a key trade hub between the North and the South, to the benefit of all concerned. Back in Franco’s days, when Spain shut itself off from the rest of the world, Spaniards came to Andorra to buy products unavailable in their own country, especially those made in France. The 1950s and ‘60s were called the “Duralex years,” in reference to the reputedly unbreakable glassware that filled showcases in Andorra’s “bazaars,” or the “Nylon years,” after the synthetic material used to make women’s stockings. Over time, the so-called “bazaar” industry has moved towards high quality and even luxury goods: jewelry, perfumes, cosmetics, brand-name clothing and accessories. They can all be purchased at lower cost in Andorra, thanks to its low taxes. Andorran commerce, along with the country’s natural and cultural resources, attract large numbers of tourists (12 million in 2002). There is thus still a great need for foreign labor. The concept of cultural diversity is being applied in a very concrete manner in Andorra. The variety of education systems – another positive legacy of Andorra’s history – helps to guarantee this diversity. The French and Spanish systems (of which there are both secular and religious versions) still coexist alongside the Andorran system, which is more recent. All three are free, public education systems.
Three European languages (Catalan, the official language; Spanish; French) are widely spoken and taught in Andorra. There is also a fourth commonly used language, Portuguese, which is spoken by a large immigrant community. English is also taught in school. While Andorra has always had great respect for multilingualism, it has made it a duty to promote Catalan. The use of Catalan is mandatory for government services and for companies in direct contact with the public. Catalan classes are available free of charge to newcomers.  

T.D.L.: Your country was included in the OECD’s 2001 list of “noncooperative tax havens.” What is Andorra doing to ensure that its laws and tax system comply with international demands for financial transparency?

H.E.I.T.: The Andorran tax system was not designed with the aim of making it more advantageous than those of neighboring States. This is an outgrowth of historical events. Indirect taxes (the goods tax, the services tax, etc.) are the mainstay of the Andorran tax system. Andorra does not have a special tax system exempting nonresidents from paying mandatory taxes. We believe that Andorra’s inclusion on the OECD list stems from an incorrect analysis of the situation in Andorra. Our country has set up various judicial instruments that encourage international cooperation in the financial arena, most notably the Law on International Cooperation in Penal Matters and on the Fight against Money Laundering and Proceeds of International Crime, enacted in December 2000. This Law permits the execution of sentences pronounced abroad, allowing confiscations and a wide range of goods seizures. It also created a money laundering prevention unit (the UPB), which has signed agreements with its foreign counterparts, France’s TRACFIN in particular. These moves have been lauded by MONEYVAL, the Council of Europe Select Committee of Experts that monitors the enforcement of the Convention on Laundering, Search, Seizure and Confiscation of the Proceeds of Crime, of which Andorra has been a member since 1999. Experts from both MONEYVAL and GAFI have closely scrutinized Andorra’s financial system, and have never put Andorra on their blacklist. In 1990 Andorran banks adopted an Anti-Money Laundering Code of Practice. It is based on 40 recommendations from the Bale Committee that set restrictions on opening bank accounts for nonresidents. Only individuals who actually reside in the country or companies operating under Andorran law can open a bank account in Andorra. Andorra requires that all bank account holders be identified, and requires individual parties and institutions – both banking and non-banking organizations – to  report all suspicious transactions.

T.D.L.: Ten new European States will be welcomed into the European Union in May 2004. How does Andorra feel about the EU enlargement process? What role could the smaller-sized States play in Europe?

H.E.I.T.: As a country embedded within the European Union, geographically speaking, Andorra is keeping a keen eye on the enlargement process, especially the creation of new decision-making mechanisms that will allow small States to make their voices heard. Our country hopes that the terms of the future Constitutional Treaty will specifically address small-sized States that have particularly close ties to EU member States. And if this is impossible, it hopes that the small States’ wishes will at least be echoed in an accompanying political declaration.

T.D.L.: On 20 November 2003, Andorran Foreign Minister Juli Minoves Triquell and European Trade Commissioner Pascal Lamy released an update on Andorran-EU negotiations on cooperation, taxation on savings, the euro, and the free movement of persons. Could you outline the headway made on these four agreements? Are there good chances we will soon see an all-around rapprochement between Andorra and the EU?

H.E.I.T.: Andorra signed a customs union agreement with the European Community in 1990. We are now looking to build even closer ties, pursuing four inseparable goals. The first goal is greater cooperation in the educational, cultural and environmental arenas, with a framework cooperation agreement set to be signed very shortly. The second goal concerns the taxation of savings income, an area where the principality hopes to strike an agreement crafted after the Swiss model. Thirdly, Andorra would like to make the euro its official currency, as it is already in widespread use, as were the franc and the peseta  in the past. Finally, our country has asked that its citizens receive treatment similar to EU residents at borders outside the Union. Discussions are already underway in all four areas, and we hope that they will soon be brought to a successful end. We believe that these four agreements will establish an adequate degree of rapprochement.

T.D.L.: The recent opening of diplomatic ties with Armenia is a good example of Andorra’s ongoing efforts to expand its foreign relations. Could you summarize Andorra’s main foreign policy objectives for our readers?

H.E.I.T.: Andorra did not begin building diplomatic ties until 1993. It has established relations with 81 States since that time, with many of them accrediting an Andorran Ambassador. Three ambassadors have taken up residency in embassies inside Andorra: France, Spain, and Portugal. The other ambassadors to our country reside in Madrid or Paris. Andorra’s main foreign policy objective is to maintain the excellent ties it has built with  neighboring countries and with the greater European family. After seven hundred years blessedly free of warfare, Andorra also lays great weight on development aid and programs that promote peace.

T.D.L.: Though Andorra maintains close ties with France, the French language is no longer widely spoken in your country. A new bilateral education agreement, but what else can be done to boost France’s language and culture in Andorra? Is regional cooperation in the cultural and economic arenas focused on specific target areas?

H.E.I.T.: We have recently signed a new version of the Franco-Andorran agreement on education, guaranteeing that the French Coprince’s schools will continue to operate in Andorra. Comprised of several elementary schools, one middle school, a high school and a vocational institute, this highly important educational system is the backbone of the French-speaking community in Andorra. The government is concerned about the fact that the French language is losing ground in Andorra, and encourages all initiatives designed to ensure that the French language and  French culture maintain their rightful place in Andorran society, as was the case in past years. The recent opening of an Alliance francaise has been widely hailed. The Andorran Chamber of Commerce and Industry and its French counterparts have met on several occasions, in a drive to foster closer economic cooperation. Moreover, the only way to strengthen regional cooperation is to improve access routes. Recent projects in Andorra (the Envalira Tunnel) as well as France (Foix Tunnel, highway) have brought Andorra and Toulouse even closer. There is still a great deal that can be done, especially in the area of  rail transportation. Finally, the Andorran Foreign Affairs Minister recently announced that the government intends to put forward the principality’s candidacy for membership in the International Organization of the Francophonie.
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