The Pacific Alliance, an agreement by Chile, Colombia, Mexico, and Peru to achieve deeper integration and jointly promote economic relations across the Pacific, constitutes one of the few bright spots in current Latin American integration efforts. The Alliance has significant potential to benefit the member countries, enlarge its constituency, and promote trade with other areas. This essay presents a brief overview of the Pacific Alliance, how it was created, what progress has been made so far, and the potential benefits it offers to Pacific-Rim Latin American countries.
Chile, Colombia, Mexico, and Peru share stable democratic governments, good macroeconomic policies and a similar pro-market orientation, and a common interest in deepening economic ties with their counterparts in the Asia-Pacific region. The original idea was to encompass all the Latin American Pacific Rim countries (the so-called ARCO del Pacifico initiative), but as negotiations moved slowly the presidents of the four largest countries, which already had bilateral free trade agreements among them, decided to speed up the process on their own on April 28, 2011, leaving the door open for others to join later. Currently, all the other Pacific Rim countries in the hemisphere, in addition to several other countries, participate in Alliance meetings as observers, and the three largest Central American economies (Costa Rica, Panama, and Guatemala) are either beginning the process of joining or have expressed interest in doing so.