TRADE AGREEMENTS WILL BE TOP PRIORITY FOR FUTURE PRESIDENT

Chile’s next president should expect to assume power with an already packed agenda of free trade negotiations. As current President Ricardo Lagos steps down, at least a dozen trade negotiations are underway with some of the world’s largest economies.

Japan, India, and Mercosur should be the focus of the next administration, but free trade agreements (FTA) with Chile’s Andean neighbors, Peru and Chile, as well as Panama, Vietnam, and Indonesia are also expected to begin within the next presidential term.

“Japan should be at the top of the agenda in 2006,” said Carlos Furche, Chief of the Economic Directorate (DIRECON) at the Foreign Ministry. “We are leaving (the next government) with an active, full and enjoyable agenda.”

Government officials expect the trade negotiations with Japan to be prolonged and complicated before any concrete agreement can be reached.

An FTA with India is also a possibility given the partial FTA Chile agreed to with the Asian country last week (ST, Nov. 24). India was unwilling to agree to a comprehensive FTA citing the need to protect their developing national economy, however, a Chilean feasibility study identified several areas the two countries could expand on.

“The study concludes that there exists the possibility to substantially increase commerce in areas such as investments and leaves the door open for us to negotiate a comprehensive FTA” said Furch. “This is just as important, or more so, than the strictly tariff-oriented agreement we agreed to.”

President Lagos also initiated trade talks with Malaysia and Thailand during the 13th Asia-Pacific Economic Cooperation (APEC) leaders’ meeting in November, promising to evaluate the feasibility of FTAs with the two nations however.

Chile expects to negotiate a bilateral FTA with Turkey in the near future based on mutual agreements each nation has with the European Union (EU). Trade talks with the Southern Common Market (MERCOSUR) are also advancing but nothing definite has been agreed on because of outstanding trade disputes between Chile and Argentina (ST, Sept. 20).

“If the possibility to negotiate services with Mercosur opens it will be the top priority on the 2006 agenda,” said Furch. “We would like to increase commerce and the flow of goods, and, I hope, solve our controversies.”