Singapore joins the Pacific Alliance
The Asian city-state joins the bloc formed by Chile, Colombia, Mexico and Peru. The Alliance wants to become an intermediary between Latin America and Asia. Singapore already developed trade ties with the region through the former TPP promoted by Obama to counter China. The accord is set to be officially signed in December.
Buenos Aires (AsiaNews) – A decade after its creation, the group of Latin America’s four Pacific nations reached one of its most significant achievements. The Pacific Alliance (Alianza del Pacífico, AP) signed an agreement with Singapore, the first external partner to reach a formal accord of cooperation with the trade bloc formed by Chile, Colombia, Mexico and Peru.
For the Alliance’s pro tempore president, Colombia’s Minister of Trade, Industry and Tourism María Ximena Lombana, the agreement marked “a milestone” in the integration of these Latin American countries with the Asia-Pacific region, one of the reasons the AP was created in 2011.
“Reaching Singapore's market allows us to use regional inputs from different countries, which will enhance productive regional chains,” Ms Lombana explained.
José Miguel Terán, a researcher with the Pacific Alliance Studies Programme[*] at ICESI university in Colombia, also believes that “achieving a treaty with one of the world’s main economies” is “a milestone”.
noting that “the treaty required the four countries negotiate as a bloc,” the expert told AsiaNews that this is a "cutting edge" agreement since “it not only includes trade in goods but also services, knowledge and cooperation.”
Terán stressed that "the AP, as an integration mechanism, aspires to become an interlocutor or intermediary through which the Latin American region approaches or inserts itself into the Asia-Pacific macro-region”.
For the researcher, “This agreement goes in that direction.” For Singapore, the treaty “updates the mechanisms of trade with the Latin American region, especially with the countries with which it already had a relationship.”
Thanks to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which replaced Barack Obama’s anti-China TransPacific Partnership (TPP), Singapore already developed multilateral ties with three AP members (Mexico, Chile and Peru).
However, after the United States pulled out, the CPTPP never “entered into force,” Terán noted.
The four AP member countries have a combined population of 230 million and their economic activity represents 41 per cent of the GDP of Latin America and the Caribbean, corresponding to the eighth-largest economy worldwide.
Singapore became an AP observer state in 2014, and talks began in 2017 to become an associate member.
The two sides are set formally sign the Pacific Alliance-Singapore Free Trade Agreement (PASFTA) during the Pacific Alliance Summit in December in Colombia.
Singapore’s Trade and Industry Minister Gan Kim Yong welcomed the deal in a videoconference.
In his view, “It sends a powerful message to the global community that our countries remain open for business and, despite the pressures placed on economic multilateralism, we want to reach out to one another and create more opportunities for our people.”
The ultimate goal, he added, is “to build on this foundation, grow our links even more, and generate opportunities for our people and businesses.”
[*]Programa de Estudios de la Alianza del Pacífico.