President Bush is in Lima, Peru for meetings with Andean leaders, the presidents of Peru, Colombia, Bolivia and the Vice President of Ecuador. He met privately with Peruvian President Alejandro Toledo earlier in the day to discuss trade, drug trafficking and the war on terrorism.

While stating the need for more open trade and business development as the best way to attack poverty, both Presidents Bush and Toledo expressed their firm resolve to protect their nations from terrorists. Referring to the bomb blast Wednesday here in Lima that killed nine people near the U.S. embassy, President Bush condemned the violence that he says undermines all efforts to improve economic and social conditions.

"Peruvians have been reminded again this week of the terrible toll of terror," he said. "On behalf of the people of the United States, I express our deep sympathy for the victims of the recent bombing and our deep sympathy for their loved ones."

Mr. Bush said the United States would back Peru and other Andean nations in their fight against both terrorists and drug traffickers. The United States is currently aiding Peru and other Andean nations with $782 million to combat drug trafficking. The Bush administration is also pressing the U.S. Congress to allow direct military funding for Colombia, which is struggling with two leftist guerrilla groups and various paramilitary organizations, all of which are funded with drug money.

Mr. Bush said he and President Toledo agreed that efforts to fight poverty will not be effective unless terrorism is brought under control.

"You cannot alleviate poverty if there is terror in your neighborhood," he added. "It is impossible to achieve what we want if terrorists run free. So I think one of the best things we can do to lay the foundations for a better tomorrow is to be tough and firm and not yield to threat. That is exactly the way the president feels and I can assure you that is the way I feel."

As part of his effort to strengthen U.S.-Peruvian ties, President Bush announced several initiatives aimed at promoting education, trade and investment opportunities. He also announced that the U.S. Peace Corps program would return to Peru after a 27-year absence. Peace Corps volunteers will begin arriving in August to work on health and agricultural development projects.