With trade, democracy and education on the agenda, President Clinton opened talks Thursday with Chilean President Eduardo Frei as a prelude to a meeting of heads of state from across the hemisphere.

Frei and his wife, Marta Larraechea, greeted Clinton and first lady Hillary Rodham Clinton this morning outside Chile's presidential palace, La Moneda, an 18th century fortress that originally served as the Spanish governor's mint.There were no pronouncements before Frei and Clinton retired to Frei's offices for a round of face-to-face discussions. Clinton waved to local residents who leaned out of nearby buildings to catch a glimpse of him.

After the meeting, Clinton and Frei were expected to sign bilateral agreements creating a joint commission to weigh trade problems and to bolster education through exchange programs, according to a Clinton administration official.

The official, speaking on condition of anonymity, also said a communique would reaffirm the two presidents' commitment to eliminating trade barriers and address the effects of recent climatological changes and pledge cooperation in international peacekeeping missions.

While the two presidents were talking, members of Clinton's cabinet, including Secretary of State Madeleine Albright and Education Secretary Richard Riley, met separately with their Chilean counterparts.

La Moneda is an important site in Chile's resurgent democracy: The Chilean air force bombed the building during the 1973 military coup against President Salvador Allende, who committed suicide in his offices rather than surrender.

No formal list of topics has been announced for Clinton's direct talks with Frei, but issues of commerce were expected to arise. The summit will deal primarily with plans for a free trade zone in the Western Hemisphere.

Trade between Chile and the United States boomed to nearly $7 billion in 1997. Several trade disputes are pending, including accusations that Chile is dumping its salmon into the U.S. market at low prices.

After an overnight flight from Washington, the president and first lady Hillary Rodham Clinton descended Air Force One shortly after 6:30 a.m. to a red-carpet welcome by Chilean Foreign Minister Jose Miguel Insulza. The Clintons held their hands over their hearts as a military band played the Star Spangled Banner, and then they headed by motorcade to their hotel.

The Chileans expected Clinton to inquire about their air force's plan to invest $500 million in new jet fighters. Later this month, the air force will decide whether to buy F-16s or F-18s, or to turn to European producers.

A state dinner in honor of Clinton and his wife, Hillary, is planned for Thurdasy night.

On Friday, Clinton was heading to the coastal city of Valparaiso to address a joint session of the Chilean legislature - an appearance that could lend some drama to week.

Gen. Augusto Pinochet, the former military dictator whose government was responsible for more than 3,000 political killings during a 17-year reign, was named a senator for life last month and could be in the audience for Clinton's speech.

Friends and former colleagues of Chilean diplomat Orlando Letelier, who was assassinated in Washington in 1976, have been pushing the administration to speak out against the sort of state-sponsored terrorism practiced by Pinochet's government.