Leaders from the Americas Move Trade Deals on APEC Sidelines

Members of the Asia-Pacific Economic Cooperation pact, known as APEC, met last week in Vladivostok, Russia to discuss trade—though much of the action took place on the sidelines. The 21-member bloc of countries bordering the Pacific encompasses five members in the Western Hemisphere: Canada, Chile, Mexico, Peru, and the United States. Heads of state met on September 8 and 9, reaching an agreement to reduce tariff caps of up to 5 percent on over 50 environmental goods by 2015. But during the annual summit, a number of sidelines meetings and agreements overshadowed the group’s summit.

First, representatives from Chile, Peru, and the United States—along with six Asian Pacific Rim countries—met in a separate forum to discuss the Trans-Pacific Partnership (TPP). Conceived in 2005 and currently under negotiation, this free-trade agreement of countries bordering the Pacific will also include Canada and Mexico in upcoming talks. With the two new countries negotiating, a final agreement would cover a geographic area with a GDP of $20.5 trillion and 658 million people. This so-called “bloc within a bloc” began its most recent negotiation round on September 6 in Virginia for a series of meetings ending September 15.

Next, Canada’s Prime Minister Stephen Harper met with Chinese President Hu Jintao on Sunday, when the two leaders signed the Canada-China Foreign Investment Promotion and Protection agreement, originally announced in February. Intended to protect investments between the two countries, the accord “will provide stronger protection for Canadians investing in China, and create jobs and economic growth in Canada,” Harper said.

Chilean President Sebastián Piñera had a busy schedule of bilateral meetings, including one with Russian President Vladimir Putin. His talks with the Russian leader included exploring the possibility of negotiating a free-trade agreement (FTA) with Belarus, Russia, and Kazakhstan. During his stay, Piñera also finished the negotiations for an FTA with Thailand and signed such an accord with Hong Kong. The president also initiated negotiations for an FTA with Indonesia. Finally, the president and Chilean Foreign Minister Alfredo Moreno signed a third and final phase of a free-trade agreement with China, originally conceived in 2005. The final part deals with expanding bilateral investments.

Peru was another Latin American APEC member to forge agreements and meetings on the sidelines. Peruvian President Ollanta Humala met with his Indonesian counterpart to begin negotiations for a free-trade agreement. He also met with International Monetary Fund Managing Director Christine Lagarde, who asked for support to set up a fund for the organization’s poorest countries and praised Peru’s social inclusion efforts. Humala met with Piñera to discuss a maritime dispute which will be brought before the International Court of Justice in December, and the leaders agreed to abide by the Court’s decision.

During the summit, Mexican President Felipe Calderón called for more Latin American countries to enter APEC, including Colombia, Costa Rica, and Panama. These three countries have observer status and await acceptance to the bloc. But he, too, saw action outside of the official APEC summit. Calderón held a number of meetings, including with New Zealand Prime Minister John Key to expand bilateral ties and to discuss the TPP negotiations, which Mexico will join shortly. He also met with Indonesian President Susilo Bambang Yudhoyono to talk trade. Finally, the Mexican president met with Peru’s Humala. The two leaders discussed bilateral ties and progress with the Pacific Alliance, a trade bloc that includes Colombia and Chile.

*Chile's Alfredo Moreno was previously identified erroneously as the prime minister, rather than the foreign minister.

In other trade news from the hemisphere:

• Following the APEC summit, Mexican President Felipe Calderón headed to Singapore for a state visit to increase bilateral trade and investment.
• Chile’s President Sebastián Piñera also took advantage of APEC to make a state visit to Australia to drum up support for greater investments and technology transfers from the Pacific Rim country, La Tercera reports.
• Mexican President-elect Enrique Peña Nieto heads to Brazil on September 18 and 19, where he could discuss negotiations for the Strategic Agreement for Brazil-Mexico Economic Integration, a wide-ranging free-trade agreement between the two countries.
• This week, the European Union’s Parliament will begin debating the ratification of a free-trade agreement with Colombia and Peru, signed in June 2012.