Trade: The Pacific Alliance celebrates 10 years of co-operation

10 years on, the Pacific Alliance is still going strong

By Jorge Alberto Julian Londono de la Cuesta, Raul Eduardo Fernandez Daza, Juan Jose Ignacio Gomez Camacho and Roberto Rafael Max Rodriguez Arnilla

Colombia, Chile, Mexico and Peru — sister nations united by history, a common language and the vast Pacific Ocean — signed the “Declaration of Lima” on April 28, 2011, establishing a new integration scheme to achieve the free transit of goods, services, capital and people; promote greater growth, development and competitiveness of their economies; and become connected to the rest of the world, especially the Asia Pacific .

Today, 10 years after its creation, the Pacific Alliance is the regional integration mechanism that has accomplished the most achievements in the shortest amount of time, establishing a flexible and pragmatic integration space with a view towards deep integration, representing the eighth largest world economy, 41 per cent of Latin America’s GDP and 40 per cent of foreign direct investment in the region .

When the agreement came into force, 92 per cent of the goods imported and exported between the four countries had duty-free tariffs, which has contributed to productive supply chains in the region, allowing each member of the alliance to access supplies from the other three countries . Similarly, export, investment and tourism promotion activities have generated nearly US $1 billion in business opportunities . This would not have been possible without initiatives aimed at facilitating trade, such as the interoperability of the foreign trade single windows, which save costs, time and facilitate business development among entrepreneurs by allowing them to process their certificates digitally .

For SMEs, the Pacific Alliance has established an ecosystem of entrepreneurship and innovation made up of networks of innovation agencies, investors, business accelerators and technology transfer offices, which has made it possible to unite the business community and develop innovation in member countries .

For SMEs, initiatives such as the entrepreneurial capital fund stand out . It has given startups financial support to grow and go global while establishing an ecosystem of entrepreneurship and innovation with accelerator agency networks, investors, innovation and technology, which has made it possible to unite the business community and develop innovation in member countries . Likewise, the Pacific Alliance Cooperation Fund has been established, with US $1 million available to finance projects in various areas .

For the four member countries of the alliance, it is clear that deepening integration requires generating incentives for the creation of new ventures, especially in activities that are intensive in human capital . In this sense, the Pacific Alliance seeks to be a portal for the knowledge economy and a landing strip for future technological ventures in Latin America . For this reason, and with a view to what the economy and trade of the future will be like, during the last summit in Santiago de Chile, the countries’ presidents signed a declaration

In April 2011, Colombia, Chile, Mexico and Peru signed the Declaration of Lima, establishing a new integration scheme to achieve the free transit of goods, services, capital and people and promote the greater growth, development and competitiveness of their economies.

on the development of the regional digital market (MDR) and the drive towards digital transformation . These initiatives seek to enable the free flow of digital products, goods and services that are marketed through the internet .

Characterized by its high degree of flexibility and pragmatism, the Pacific Alliance’s achievements are reflected in student and academic scholarships, which have mobilized more than 3,000 students and teachers since 2013; the electronic exchange of certificates of origin and phytosanitary certificates through the foreign trade single window system; the free movement of permanent resident foreigners in the member countries; and active international relations through the network of 59 observer states and other regional initiatives, such as ASEAN, APEC, Mercosur, the Eurasian Economic Commission and the European Union .

Similarly, the Pacific Alliance has made important progress on the social and sustainable development agenda . In 2019, its four member states signed the Declaration on the Sustainable Management of Plastics, which reflects the importance of developing and implementing new policies to promote the integral management of this waste and reduce its presence in ecosystems .

In addition, in the coming weeks, the Social Observatory of the Pacific Alliance will identify the needs of the most vulnerable populations in the four countries and thereafter develop joint policies . Likewise, the promotion of gender equality and the permanent integration of women in the economy is fundamental for the Pacific Alliance . For this reason, on the occasion of the Santiago Summit, the four states signed a statement and implemented a roadmap specifically aimed at promoting the autonomy and economic empowerment of women . Being inclusive of gender has been incorporated as a cross-cutting element in all the Pacific Alliance’s work . Likewise, training programs have been developed for businesswomen and entrepreneurs in the region to strengthen their business skills, create contact networks and expand their export capacity .

The expansion of the Pacific Alliance is promising . Today, we are working with the 59 observer countries on various matters of co-operation . Also, we are signing joint statements with the EU, ASEAN and the EEC . Meanwhile, progress is being made to begin negotiations with associated states such as Singapore, and meetings are being held with Canada, New Zealand and Australia to establish a mutually beneficial association agreement with these countries . Meetings have started with Ecuador and it is expected that in the near future it will become the fifth member of the Alliance .

The Pacific Alliance shares common values and principles with Canada, as well as a similar vision of the global challenges our countries face during this health and economic crisis . Through Colleges and Institutes Canada (CICan), important co-operation channels have been consolidated with the alliance, especially the Education for Employment Program of the Pacific Alliance (EPE-AP), a joint project that facilitates a three-party dialogue between the public sector, private sector and civil society to address the issue of environmental sustainability .

Despite these achievements, there is still a long way to go . Before the pandemic, intra-regional trade in Latin America and the Caribbean was barely 30 per cent, compared to other regions with higher rates, such as Europe (70 per cent) and Asia (60 per cent) . In 10 years, the Alliance has achieved much for our countries, counting on the active participation of the private sector through the Business Council of the Pacific Alliance . However, there are new challenges today, in particular due to the COVID-19 pandemic . We can only overcome these challenges together . We must continue working together towards the construction of an alliance that is more integrated, more connected and more global every day to enhance our competitiveness and help us overcome inequalities, to benefit the 229 million citizens who reside in our four countries . D

As shown on the map, the Pacific Alliance stretches down the West Coast of North and South America. Its total area is 13,729, 753 square kilometres.

Pacific Alliance leaders haven't met lately because of the pandemic. This meeting took place in 2013. From left, then-Mexican president Enrique Peña Nieto, then-Colombian president Juan Manuel Santos, Chilean President Sebastián Piñera and then-Peruvian president Ollanta Humala.