Unit 4 Macro: The New Pacific Alliance

Here are some resources on the newly created Pacific Alliance which - in the short run - has achieved significant tariff reductions but which in the long run seeks to create a new economic community / single market in the region.

The nations of the Pacific Alliance are promising free trade with a focus towards Asia.

Together they have a population of 209 million, and a combined economic output of $2tn a year, which is about a third of all the wealth by Latin American countries, or the same as the region's powerhouse, Brazil.

The new group plans to be less political, more clearly focused on trade.

The idea is to better integrate the economies of Colombia, Mexico, Chile, and Peru.

The Pacific Alliance is a newly established Latin American trade bloc, with some features of further economic integration. Its current member states are Chile, Colombia, Mexico, and Peru; all countries that border the Pacific Ocean. Costa Rica is expected to join shortly.

The main goals of the Pacific Alliance are

1. To ensure tariff free circulation of goods and services
2. To provide free circulation of capital and people
3. To foster economic growth, development and competitiveness
4. To increase ties to the world, especially to Asia-Pacific

The Pacific Alliance accounts for 37% of Latin America's GDP. Mexico has benefited from large amounts of direct foreign investment, in the automotive, manufacturing, aviation, information technology and tourism. The total value of FDI into Mexico has exceeded $75bn over the last ten years.

Pacific Alliance and Mercosur

Biz America News Report

Mexico's competitive advantage in car manufacturing