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Mexico-Panama free trade agreement nears Senate ratification

Mexico-Panama free trade agreement nears Senate ratification

Mexico’s policymakers continue to pursue the country’s free trade strategy.

Discussions are currently underway in the Mexican Senate on the topic of the ratification of a Mexico-Panama free trade agreement. Proponents of signing the accord between the two Latin American countries point toward a successful completion of the treaty as being another step towards achieving the goal of promoting a greater diversification of the partners with whom Mexico trades on duty and tariff free terms.

The Mexico-Panama free trade agreement was, in fact, signed by both governments in April of 2014, however, until now the treaty had not been addressed for consideration and ratification by the Mexican Senate. In additon to diversifying Mexico’s base of free trade partners, the approval of the agreement by the Senate would serve to further solidify Mexico’s position as Latin America’s foremost trading nation.

Mexico’s vice chancellor for Latin America and the Caribbean, Vanessa Rubio, sees Senate approval of the Mexico-Panama free trade agreement as “the relaunching of diplomatic relations” the two Spanish speaking nations. She also believes that a bi-lateral free trade agreement between the two regional neighbors will “benefit both countries citizens by creating more jobs” in the partner countries.

According to Mexico’s subsecretary of foreign trade, Francisco de Rosenweig, “Panama is a strategic partner,” to whom Mexico has tripled the sale of manufactured exports over the course of the last several years. From his perspective a signed, sealed and delivered Mexico-Panama free trade agreement will serve to further increase the volume of trade between the two countries, as well as to “open the Mexican economy to further foreign direct investment from Panamanian sources.”

Other Mexican officials, such as the President of Exterior Relations for the Americas, Mariana Gomez del Campo, are of the opinion that a ratification of the Mexico-Panama free trade agreement by the country’s Senate is a logical step given the complementarity that exists between Panama’s service-based economy, and the manufacturing prowess that characterize Mexico’s economic base.

Once the trade accord is ratified by the Mexican Senate, Panama will immediately be granted full member status in the Pacific Alliance. The Pacific Alliance is a Latin American trade bloc, with some features of economic integration. It currently has four member states: Chile, Colombia, Mexico, and Peru, which all border the Pacific Ocean. Costa Rica began the process of joining the Alliance on 10 February 2014.

Panama is Mexico’s largest Central American trading partner. In the last ten years, trade between the two country’s has increased by a factor of two hundred and fourteen percent. For its part, Mexico has made investments in Panama during the same period that are valued at slightly above US $2 billion.

Read the primary source for this post in its original Spanish at Contacto Hoy.

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