SANTA MARTA - Colombia and Venezuela reestablished diplomatic relations Tuesday, the countries said in a joint statement after ties were broken last month in a row over alleged harboring of rebels.

Conservative Colombian President Juan Manuel Santos and leftist Venezuelan President Hugo Chavez agreed to "relaunch bilateral relations and reestablish diplomatic ties between the two countries based on transparent and direct dialogue," the statement said.

Santos said he also received assurances from Chavez that the Venezuelan leader would not allow guerrilla groups to set up camp inside his borders.

Trade and diplomatic links broken by Chavez on July 22, after the former Colombian government of Alvaro Uribe claimed that 1,500 guerrillas with the Revolutionary Armed Forces of Colombia (FARC) and National Liberation Army (ELN) were operating in Venezuela.

The two leaders met in the Caribbean city of Santa Marta for what Santos, who took office on Saturday, said would be "frank and direct" talks on a crisis that peaked last month after Colombia accused Caracas of harboring Colombian rebels.

After taking the oath of office Santos moved quickly to set a new course with Venezuela, distancing himself from the confrontational stance taken by his predecessor and mentor, Alvaro Uribe.

"We're optimistic, we really want this meeting to produce sure and lasting results for the good of our peoples," Santos said Tuesday.

"We want to build peace between us, whatever it costs," Chavez said as he arrived in Colombia.

The two leaders -- who have opposing ideologies and have exchanged heated words in the past -- met in private in the house where Simon Bolivar, a South American independence hero and Chavez's idol, died in 1830.

Relations between Colombia and Venezuela had been seriously strained as far back as July 2009, when Chavez froze ties after Bogota agreed to give the United States access to seven military bases to fight cocaine production and trafficking.

Trade between the South American neighbors -- $6 billion a year in 2008 -- fell precipitously during the dispute, hurting economies on both sides of their 2,000 kilometer (1,200 mile border) border.

Venezuela's debt to Colombian exporters -- of some $1.5 billion, according to the Colombian-Venezuelan Chamber of Commerce -- also remains.

Many observers saw the change in the Colombian leadership as an opportunity to defuse tensions that saw Chavez order troops to the border last Friday.

Brazilian President Luiz Inacio Lula da Silva, who has worked behind the scenes to encourage the rapprochement, said Monday: "I'm a great optimist regarding the building of peace between Venezuela and Colombia."