ASSESSMENTS

Latin America's Two Trade Blocs Get a Little Closer

Nov 14, 2017 | 09:00 GMT

Chile, Colombia, Mexico and Peru, which all border the Pacific Ocean, make up the Pacific Alliance trade bloc.

The Pacific Alliance is composed of Mexico, Peru, Chile and Colombia, whose gross domestic products total over $2.2 trillion and have a combined population of over 220 million.

(iStock)

Highlights

  • The Pacific Alliance and Mercosur have put aside their political differences as both blocs seek to reduce trade barriers.
  • The Pacific Alliance will continue to face challenges in increasing trade within its bloc as its members continue to trade more with countries outside the bloc than with those inside it. 
  • The Pacific Alliance will speed up its trade negotiations next year with Mercosur and countries that are part of the Trans-Pacific Partnership.

Latin America's two largest trade blocs, the Common Market of the South (Mercosur) and the Pacific Alliance, are taking small steps on the path to convergence. The fall of the left in Mercosur's two largest economies, Argentina and Brazil, and the U.S. decision to renegotiate NAFTA with Mexico have provided the two organizations with an opportunity to put aside their differences and move forward on trade negotiations....

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