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Playing Both Sides of the Pacific: Latin America's Free Trade Agreements with China

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One of the most prominent trends in Latin America in the 2000s has been the proliferation of bilateral free trade agreements (FTAs) across the Pacific basin. Beginning with the path-breaking Chile-Korea FTA in 2004 up to the Costa Rica-Singapore FTA in 2013, the past decade has seen the negotiation of twenty-two cross-Pacific accords. China, too, has jumped on to the cross-Pacific FTA bandwagon, including its negotiation of separate bilateral FTAs with Chile (2006), Peru (2009), and Costa Rica (2011). This paper analyzes the origins, content, and preliminary outcomes of these three China-Latin America FTAs. The findings are threefold: 1) in contrast with other cross-Pacific FTAs, which include at least one developed country, the three FTAs analyzed in this paper constitute “south-south” FTAs; yet, in contrast with other south-south FTAs, these three China-Latin America accords approximate WTO+ standards vis-à-vis the World Trade Organization (WTO) and its new trade agenda (services, investment, and intellectual property rights); 2) although the motives for negotiating these developing- developing country accords varied, on the part of China and the countries themselves, this did not disrupt the march toward WTO+ status; and 3) while all three of these FTAs elude standard theoretical explanations for the negotiation of bilateral FTAs, the three Latin American countries do share similar reform trajectories and institutional affinities, which sheds light on the decision and capacity of each to negotiate a bilateral FTA with China.
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Keywords: CHILE; CHINA; COSTA RICA; FREE TRADE AGREEMENT (FTA); INVESTMENT; LATIN AMERICA; MANUFACTURING; MARKET ACCESS; MINING; NATURAL RESOURCES; PERU; REGIONALISM; SERVICES

Document Type: Research Article

Publication date: March 1, 2016

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