Protocredits: Alianza del Pacífico

Early this month the presidents of the Pacific Alliance (PA) met in Lima, Peru for their regular yearly summit. The absence of the Mexican president overshadowed the XIV meeting and marked the first time in eight years that a president of the member states did not heed the call. A series of meetings by the ministerial councils and technical groups of the mechanism between 1 and 6 of July preceded the presidential gathering.

The outcomes of the presidential summit include a political Declaration in Support of the Multilateral Trading System that refers to the commitment of the members towards a rules-based system, their support to the World Trade Organization, and their rejection towards protectionist measures that have hindered global economic growth. Members also signed a Declaration for the Sustainable Management of Plastics stating their commitment to undertake specific initiatives to better management practices. Framework agreements for cooperation were concluded with Japan, the Eurasian Economic Commission and the Organization for the Economic Cooperation and Development (OECD).

As customary with the early harvest approach the Pacific Alliance has followed since its inception, the presidents and ministries highlighted the progress of the integration. The works underscored include multiple events hosted under the PA umbrella, such as macro business round-tables, joint commercial and investment promotion activities, the delivery of technical studies and several meetings for the exchange of experiences and good practices. The outcomes also report efforts to reach harmonisation at the normative, operative and technological level.

National agencies in the state members have also signed memoranda of understanding for future inter-institutional cooperation. One of them is an interesting Memorandum of Understanding Regarding Good Governmental Practices and the Development of Cooperation Mechanisms for the Prevention and Fight against Corruption in Public Procurement Systems within the Pacific Alliance. This memorandum represents a typical example of the problem-based approach PA members have followed from the start in the definition of their practical agenda. An approach that seems reasonable, albeit it brings to question the extent to which the PA regional agenda would be able to deliver meaningful results on these broad agenda growing not only in size but also complexity.

Following, the launch of the 2030 Vision in 2018, the presidents celebrated the conclusion of a work plan to pursue the aims envisioned for a more integrated; more global, more connected; more citizen-oriented PA. So far, the scope of the work plan is still unknown since the document is not public, and it is not clear what input from the civil society and other stakeholders was received for its construction.

Moving forward, the presidents instructed the working groups with a long list of mandates to undertake activities in areas such as trade facilitation, SMEs; public procurement; financial integration; trade, investment and tourism promotion; regulatory cooperation; global value chains and productive linkages; innovation; services and capital; tourism, labour, education; gender; and culture just to mention a few.

However, a close examination of these mandates make it evident a need for more stringent monitoring mechanisms of the activities undertaken to accomplish them. Although it is clear that some of these mandates are far-reaching and could not be achieved in the short-term, a few questions arise from the practice of presidential mandates.

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In the face of the fourth industrial revolution, the settling of disruptive technologies and the non-stoppable pace of digitalisation it is timely to question the role that regional mechanisms/institutions play as enablers and governance instances of these technological developments. This is not only because of the economic and welfare benefits arising from them but also for the need to address the tensions and dilemmas they pose to traditional economic systems, patterns of production and labour.

Aware of this context and the challenges it presents, the PA recently launched a roadmap for its Digital Agenda focusing on four main pillars: (i) digital economy; (ii) digital connectivity; (iii) digital governments; (iv) digital ecosystems.  The PA proposes an ambitious goal towards the creation of a regional digital market. The PA members commit themselves to the development of an internationalisation strategy for their IT industries and digital entrepreneurs. The content and scope of this strategy on a regional level is yet to be defined.

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The reinvigorated interest of closer relations with the PA by some of the observer states is partly attributed to the uncertain future of the TPP. With a grey cloud over the TPP,  the negotiating countries are hoping to update and expand their network of commercial agreements through new channels. It is not a coincidence that, except for Colombia, the rest of original members and all the potential associate members were previous TPP negotiating parties. It would not be a surprise that they would attempt to capitalise on the issues already agreed on the TPP table when negotiating their associate member agreements. I will discuss here some concerns around the future negotiations.

Firstly, as the Pacific Alliance members and the candidates to associate members have started the negotiating process for future commercial agreements of ‘high standards’ it is timely to examine what the original PA members have in mind to put real content into an agreement of this kind. It is necessary to set the expectations and offensive interests that the PA members will put forward as a group rather than individually. Hopefully, the association agreements would be more than a form of a TPP-minus accord, where the concessions made in response to the US pressures in the context of the TPP would be withdrawn from these association agreements, and the rest will be kept untouched in the form of informal diffusion of TPP rules.

It would also be important to set a standard as to how the PA will push to incorporate disciplines in the areas of cooperation that are of interest for the mechanism: (i) movement of persons, (ii) education, (iii) trade facilitation, (iv) science technology and innovation and SMEs.

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photocredits: Theodore C (CC BY-ND 2.0)  license

As Colombia starts its pro tempore presidency of the Pacific Alliance for a year, it seems timely to examine the road ahead and how its presidency could contribute to progress on the already populated agenda of the PA. This post is the first of a series of contributions that will tackle relevant issues that could be targeted as future works for the mechanism.

It is worth mentioning the multiple areas and topics in which the PA is currently working that make it difficult to map out the actual activities and progress in each of them. As it is reported in its website  (alianzapacifico.net) there are currently 20 technical groups and one subcommittee working on topics such as: digital agenda, innovation, public procurement, gender, cooperation, culture, tourism, SMEs, intellectual property, education, mining development, services and capital, public procurement, trade and integration, communications strategy, expert group on the CEAP, promotion agencies, regulatory improvement, international fiscal transparency, movement of persons, and external relations. The establishment of two more groups one on labour and the other on green growth and the environment was also envisioned in presidential declarations. However, up to today, it is not clear if the latter two groups have been established although the Cali Presidential Declaration provides for actions regarding green growth and the environment. Notwithstanding these works the PA is also undertaking joint activities on fisheries and aquaculture, health and access to medicines, and consumer protection.

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The Pacific Alliance had a busy week closing with the Presidential Summit on Friday 1 July where new mandates to guide the progress of the integration mechanism were decided on.

The presidential summit was preceded by meetings of the High Level Group, The Free Trade Commission, The Ministerial Council and the Metting of Ministers of Finance. The IV Business Metting also took place on the 29th June. In addition, the third meeting of higher education institutions of the PA on the 21 and 22 June was an opportunity to discuss the role of the academic and student mobility platform for the integration of the PA countries.

Steps were taken this week on various fronts. First the PA members approved an accord that sets the tax rate on pension funds investments returns at 10 percent. This agreement covering the pension funds from the four members is an effort to boost investment in infrastructure projects while opening up the pool of investment options for these entities within the region. However this is a ceiling rate that will only require implementation by Mexico since Chile and Peru have a rate that is already  5 per cent, while Colombia has a zero per cent rate for pension funds from the PA. In addition, a decision on the creation of a regional infrastructure fund is still pending.

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Photocredits: 7Crafts/FreeDigitalPhotos.net
This week the Pacific Alliance Council of Ministers announced the approval of the guidelines for states to become associates of the PA. The move is a response to the persistent interest that some of the observer states have in the mechanism and a push to move forward with economic and political relations with those observer states of ‘higher interest’.

The brief guidelines outline the requirement that, to become an associate state, the candidate should conclude a mandatory economic and commercial agreement with the four PA members that follows ‘high standards‘.  Although the guidelines are rather vague as to what constitutes a high standard agreement it seems to refer to the disciplines that shall be covered, including trade in goods, services and investment. It is also an underlying requirement that the agreement encourages openness and market integration along with its alignment with the general objectives of the PA.

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While President Trump has recently withdrawn from the TPP Agreement, not yet ratified, and announced his interest in negotiating on a bilateral basis any commercial agreement, the Pacific Alliance has made an interesting political move.  The PA has called for a meeting to take place 14-15 March in Chile.

The purpose of the meeting is gathering not only foreign affairs ministers of the TPP negotiating parties but also China, South Korea and Colombia. Although no formal commitments are expected from the ministerial summit, it will provide a forum for Asian and PA countries to discuss ways to move forward in the economic front while counter-reacting to the protectionist narrative of recent months in the US.

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Abstract:
The Pacific Alliance (Chile, Colombia, Peru and Mexico) emerged as a new bloc in Latin America in April of 2011. Its members declared it to be an integration process to promote open regionalism and to deepen ties with the Asia-Pacific region – as it was stated in the Pacific Alliance Framework Agreement. From then on, the idea that the Pacific Alliance could constrain Mercosur was debated by the Academia, by both national and international media and also by Brazilian domestic agents.

At first, Brazil treated the impacts of the Pacific Alliance on Mercosur with some skepticism. This approach was mainly because Brazil believed that the Pacific Alliance could learn from the Mercosur experience, until 2014, when there was a Brazilian initiative to bring together Mercosur and the Pacific Alliance. Thereafter it has been an important topic in Brazilian foreign policy agenda.

This dissertation focuses on understanding this subject through Brazilian foreign policy, by highlighting how Brazil perceived the Pacific Alliance and what were the initiatives related to this bloc between 2011 and 2018. The research was based on a qualitative methodology and qualitative data to answer if the Pacific Alliance is conflicting or complementary to the Brazilian regional integration agenda.

The results elucidate the main Brazilian statements about the Pacific Alliance. It examines how the Pacific Alliance became an internal topic of discussion, which domestic agents and government agencies were involved in the decision-making process, what the differences were in their involvement. It primarily discusses the lines of continuity from one government to another supporting the hypothesis that the Pacific Alliance conflicts with the Brazilian agenda for regional integration.

Resumen:
La Alianza del Pacífico (Chile, Colombia, Perú y México) surgió en América Latina como un nuevo bloque regional en abril de 2011. Fue declarado por sus miembros como un proceso de integración regional que fomenta – según el Acuerdo Marco de la Alianza del Pacífico – el regionalismo abierto y la inserción internacional en la región Asia-Pacífico.

A partir de entonces, se empezó a discutir la idea de que la Alianza del Pacífico contrastaba con Mercosur por la Academia, por periódicos nacionales e internacionales, y por actores domésticos brasileños. En un primer momento, por parte de Brasil, los impactos de la Alianza del Pacífico sobre Mercosur fueron tratados con cierto escepticismo, principalmente por que se creía que la Alianza del Pacífico podría aprender con la experiencia del Mercosur, hasta que en 2014 hubo una iniciativa por parte de Brasil de aproximarse al bloque y, actualmente, este ha sido un tema relevante en la agenda de política exterior de Brasil.

La presente tesis de magíster se enfoca a comprender dicha aproximación a partir de la política exterior brasileña, enfocándose en cómo ésta percibe y se relaciona con la Alianza del Pacífico en el período entre 2011 y 2018. La investigación realizada se fundamentó en metodología y datos cualitativos para contestar la pregunta si la Alianza del Pacífico está en conflicto o es complementaria a la agenda brasileña para la integración regional.

Los resultados presentados elucidan los principales posicionamientos brasileños en relación a la Alianza del Pacífico a lo largo del período; cómo surgió el debate interno en relación a aquella; cuáles actores domésticos y agencias gubernamentales se involucraron en el proceso de decisión; cuáles son las diferencias, y principalmente, cuáles son las líneas de continuidad de un gobierno y el otro que sostienen la hipótesis de que la Alianza del Pacífico es opuesta a los objetivos brasileños para la integración regional.

Author: Julia de Souza Borba Gonçalvez

Spanish Title: Brasil y la Alianza del Pacífico: ¿visiones en disputa en la integración regional?

Portuguese Title: Brasil e a Aliança do Pacífico: visões em disputa na integração regional?

Full document:2019, Borba, Brasil e a Aliança do Pacífico- visões em disputa na integração regional?