Pacific Alliance backgrounder

The Pacific Alliance

• The Pacific Alliance is a regional integration initiative created in 2011 by Chile, Colombia, Mexico, and Peru, to promote greater competitiveness and economic growth for member countries, with the objective of moving toward the free movement of goods, services, capital, and people among its members.

The Pacific Alliance is important to Canada

• Canada is a trading nation. Canadians’ standard of living depends on robust international trade as a key driver of economic growth for a prosperous middle class.
• Expanding and diversifying Canada’s trade with large fast-growing markets, such as the Pacific Alliance, offers the possibility to modernize and streamline our existing trade agreements, achieve modest incremental market access improvements, and promote an inclusive approach to trade.
• With its population of over 230 million and combined real GDP of $2.8trillion (2020), the Pacific Alliance offers Canada strong potential to establish an ambitious, inclusive trade relationship.

Why Canada agreed to negotiate a free trade agreement (FTA) with the Pacific Alliance

• Concluding an FTA with the Pacific Alliance is a prerequisite for Canada becoming an Associated State to the Pacific Alliance
• An FTA with the Pacific Alliance would offer the prospect to modernize and streamline our existing agreements, expand elements of these existing bilateral agreements, as well as potentially include inclusive trade elements, such as chapters on trade and gender as well as small and medium-sized enterprises.
• Canada and the Pacific Alliance share many values, such as open markets, inclusive growth and environmental sustainability.

An FTA with the Pacific Alliance can protect Canadian interests

• The Government of Canada is committed to developing trade policies that respond and contribute meaningfully to the Government’s overall economic, social, and environmental policy priorities.
• Canada is seeking to integrate inclusive elements regarding gender and trade, small and medium enterprises, environment, labour, and corporate social responsibility.
• In particular, Canada will seek to include commitments on the creation of committees that would oversee cooperation, promote information sharing, and facilitate the development of programs to assist SMEs and women to participate in international trade.
• This is consistent with Canada’s current approach to negotiating FTAs, which seeks to ensure that all segments of society can take advantage of and otherwise benefit from the opportunities that flow from trade and investment.‎

Benefits of an FTA with the Pacific Alliance in addition to other FTAs, such as CUSMA and CPTPP

• An FTA with the Pacific Alliance would present a strategic opportunity for Canada to further our inclusive approach to trade with a group of countries that is increasingly important and garnering global attention. It also supports these countries’ efforts to promote good governance, improve human rights and build a better economic future for their citizens.
• At the same time, this initiative is an opportunity to further improve our existing FTAs with Pacific Alliance members with a view to improving the trading environment for Canadian businesses.

Canada’s existing FTAs with the Pacific Alliance countries

• These FTAs will continue to apply and eventually co-exist with the possible new FTA with the Pacific Alliance countries as a group.

Consultations with Canadians on the possibility of an FTA with Pacific Alliance

• We launched consultations via a Canada Gazette notice on August 12, 2017 until September 10, 2017.
• Government officials have also engaged with a number of stakeholders from industry, business, labour and environment organizations and associations, as well as individuals and think tanks.
• Engagement with provinces and territories has been ongoing through the consultative mechanism of Global Affairs Canada and regular teleconference updates.

Engagement with Indigenous groups in Canada

• Regular and ongoing engagement and dialogue takes place with Indigenous peoples through Global Affairs Canada’s trade-focused Indigenous Working Group, keeping them apprised of Canada’s ongoing negotiations and trade initiatives, including the Pacific Alliance negotiations.
• The Indigenous Working Group is composed of a wide range of Indigenous peoples and groups, including representatives from the five National Indigenous organizations, modern treaty partners and Indigenous legal experts and academics.
• Canada is pursuing Indigenous-specific provisions in relevant chapters of the FTA that would improve Indigenous peoples’ access to the benefits and opportunities of the agreement. We are also seeking a variety of reservations and exceptions to maintain the Government’s ability to provide preferences to Indigenous peoples in order to fulfil its legal and treaty obligations.

Engagement with provinces and territories

• The provinces and territories were notified at the start of the consultation process and have expressed their interest in meaningful engagement as the negotiations continue.
• Engagement with provinces and territories is ongoing.

Next steps

• Canada is interested in a new, modern and inclusive FTA that goes beyond existing agreements and that will benefit those that have traditionally been underrepresented, including women, youth, SMEs, and Indigenous Canadians.

Publication of the final text

• Canada has agreed with the other parties, as is the standard international practice when negotiating international agreements, that only the final text will be shared once it is agreed upon by all negotiating parties.