Living in Peru : your everyday companion

Info provided by the
American Chamber of Commerce of Peru (AmCham Peru)

Therefore, “Roads to Prosperity” represents a proposal that complements other important commercial integration initiatives as the “Pacific Arc”, which proposes the creation of a commercial block between Canada, Colombia, Chile, Mexico, Panama and Peru to establish negotiations with the Asian market and the Free Trade Area of the Americas (FTAA), that is stunk due to politic differences between some of the members.

The importance of both the Pacific Arc and the Roads to prosperity initiatives is evident, given the effectiveness of free trade as a tool to promote economic growth and fight poverty in Latin America. It is relevant to remember that in the 15 years of NAFTA, combined trade between Canada, Mexico and United States increased 200%. Similar results are observed in Chile after 5 years of the entry in force of the agreement with the U.S. that show an 180% expansion on bilateral trade that have created jobs in a national level.

In that sense, the benefits of “Roads to Prosperity” and the “Pacific Arc” rely on the greater regional integration that will strengthen the confidence between neighbour countries and the alliances that seek common prosperity and promote the accumulation of production to attend bigger markets like those in the Asia Pacific region and will lead to explore the possibility of using regional inputs to benefit form coproduction in order to export to the U.S. market.

Finally, in a uncertainty scenario, our country has to take advantage of initiatives like these because opening up to trade, not only will allow an expansion of commercial flows, but also the creation of prosperity and the attraction of new investments from countries that do not have the same opportunities. Thus, complementing free trade with other dimensions as foreign direct investment and technological diffusion might play a central role to resolve structural problems like infrastructure and technology gaps, low quality education and other factors that affect competitiveness and the wealth of citizens.