Significant opportunities exist for deeper integration. To achieve these more challenging elements, the pact will need more time to deliver. For example, despite the foundation built by the Mercado Integrado Latinoamericano (MILA), financial integration has been underwhelming, and regulatory harmonisation remains incomplete. Issues pertaining to pension funds, bank accounts, the joint financing of development projects, and obstacles in capital flows must be addressed.
All four member countries pursue liberalised trade in an effort to move away from commodity reliance, yet, as slumping commodities yield decelerating growth, more attention must be paid to export diversification. Both observer countries and member states still wrestle with how to harness the potential of such an impressive coalition, and deeper energy integration remains one of the greatest opportunities for the Alliance.
These challenges point to the Alliance’s still untapped potential. Chile, Colombia, Mexico, and Peru have picked some of the “low-hanging fruit” of regional integration. Now, the next stage begins. This means reaching for the higher, more difficult—yet ultimately more fulfiling—levels of collaboration. It is crucial to establish milestones—three, five, and ten years out—to maintain momentum.
Over the course of the last year, we held two private roundtables featuring global leaders from the public, private multilateral, and academic sectors. In particular, this network called attention to opportunities in financial, energy, and commercial integration. The group also discussed the Pacific Alliance’s potential as a regional leader and global player, with a specific emphasis on making use of the pact’s diverse observer countries.
This document reflects the outcome of our dialogues—both as a group and bilaterally.
Authors: Jason Marczak, Samuel George, María Fernanda Pérez Argüello and Andrea Saldarriaga Jiménez
Institutional Author: Bertelsmann Foundation
Full document: 2016, Marczak & George, Pacific Alliance 2.0