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Progress And Impact Of The Pacific Alliance On Colombia, Mexico, Peru And Chile

Author:Ms Daniela Diaz Quijano
Profession:TMF Group

Seven years after its creation, the Pacific Alliance - formed by Colombia, Mexico, Peru and Chile - totals 57% of Latin America's foreign trade and 41% of total foreign investment in the region.1 The Pacific Alliance is an initiative of political, economic and regional cooperation and integration.

These countries' growth expectation for 2018 is higher than the average for Latin America and the Caribbean, according to the International Monetary Fund (IMF). The IMF expects the economy of the region will grow an average of 2% (negatively influenced by Venezuela), while Colombia will grow by 2.7%, Mexico 2.3%, Peru 3.7% and Chile by 3.4%. However, it is expected that the presidential elections in Colombia in May and Mexico in July, as well as others to take place in the region (Brazil and Paraguay), will slow down growth in the first half of the year.

The promotion of external investment and achieving greater relationships with the world, especially with the Asia-Pacific region, is one of the Pacific Alliance's strategies to increase trade. Likewise, negotiations on trade continues with Australia, Canada, New Zealand and Singapore. The aim is to increase and diversify the exports of member countries to the Asia-Pacific region, as well as increasing employment and attracting more tourism.

Increasing trade

Within the Alliance, there are many actions that have allowed member countries to increase trade. They include, the elimination of tariffs on the movement of merchandise, services, financial and human resources, the business visa, the Single Window of Foreign Trade (Ventanilla Única de Comercio Exterior) and the approval of technical standards in some sectors such as food, pharmaceutical and cosmetics.

Regarding foreign trade, Mexico has focused its strategy on market diversification, with the Pacific Alliance being the key to its expansion into Latin America. During 2017, within the framework of the Alliance, Mexican companies made 25 million dollars in exports to be completed during that year, mainly consisting of consumer goods such as processed foods, beverages and various manufactures.

Financial impact

Meanwhile, in matters related to the financial industry, Colombia has made progress on the possibility of stock companies, trust...

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