CALGARY, AB November 16, 2017 – While the Trans-Pacific Partnership (TPP) and North American Free Trade Agreement (NAFTA) capture much of the attention in Canada, a third, lesser-known negotiation offers hope to help diversify Canada’s trading markets: The Pacific Alliance.
The Pacific Alliance is a trade integration group between Chile, Colombia, Mexico and Peru where the countries build on their existing trade agreements to promote greater integration to become more competitive in trade with Asia. The bloc has been called “the NAFTA of the south.” But unlike NAFTA, which is teetering the brink of collapse, the Pacific Alliance is charging ahead in the opposite direction. Canada has individual agreements with each country, but the opportunity being offered by the bloc for Canada to deepen its connections will bring additional benefits, according to a new report from the Canada West Foundation released Thursday.
With uncertainty plaguing TPP and NAFTA talks in disarray, securing a deal with the Pacific Alliance is critical for Canada’s trade diversification ambitions, said senior policy analyst Naomi Christensen, co-author of the report, The Pacific Alliance: Why it’s (still) important for western Canada.
The report updates the Foundation’s November 2014 publication on the Pacific Alliance. Canada took the first step toward joining the bloc in June 2017 when it was invited to become an associate member. In October 2017, Canada launched the first round of negotiations with the group.
The Pacific Alliance provides an opportunity to expand trade in services and for a government putting progressive trade first, its members share our democratic and economic values. The liberalization of the movement of people, however, could be a stumbling block, the report notes.
“There are different paths to advancing trade beyond the traditional negotiations. The Pacific Alliance shows that Canada thinking beyond the traditional bilateral trade negotiation route can offer new ways to gain traction in Asia,” said Carlo Dade, report co-author and director of the Trade & Investment Centre.
“It won’t replace NAFTA, but good news is good news.”