In a world where trade agreements are hotly contested and frequently renegotiated, the Chile-Mexico Free Trade Agreement stands out as a beacon of stability and success. Since it was signed in 1999, the agreement has paved the way for increased bilateral trade, investment, and economic cooperation between the two nations.
The agreement was the first free trade agreement (FTA) signed by Mexico with a South American country, and it served as a model for Mexico`s subsequent FTAs with other nations in the region. With Chile as its entry point, Mexico has been able to access the fast-growing markets of the Pacific Alliance, a regional economic bloc that includes Peru, Colombia, and Chile.
The agreement covers a wide range of areas, including trade in goods (such as agricultural products, manufacturing goods, and services), intellectual property rights, investment, government procurement, and competition policy. One of the key benefits of the agreement is the elimination of tariffs on almost all goods traded between the two countries. This has led to a significant increase in bilateral trade, which reached $3.2 billion in 2018.
In addition to boosting trade, the agreement has also had a positive impact on investment flows between Chile and Mexico. Both countries have seen an increase in foreign direct investment (FDI) since the agreement was signed. For example, between 2000 and 2018, Chilean FDI in Mexico totaled $4.7 billion, while Mexican FDI in Chile reached $2.4 billion.
The agreement has also encouraged greater economic cooperation between the two countries. For example, Mexico and Chile have collaborated on a number of initiatives aimed at promoting trade and investment, including joint business missions, trade fairs, and investment seminars. These initiatives have helped to raise awareness of the opportunities available in each country, as well as to foster greater understanding and cooperation between the business communities of Chile and Mexico.
The Chile-Mexico Free Trade Agreement has been a resounding success for both countries. It has helped to increase bilateral trade, attract FDI, and promote economic cooperation. Despite the challenges posed by the COVID-19 pandemic, the agreement has remained strong, and both countries have reaffirmed their commitment to deepening their economic ties. As a result, the agreement is likely to continue to be a major force for economic integration and development in the region for many years to come.