After three years of negotiations with the Pacific Alliance of four South American nations, Singapore stands ready to sign a free trade agreement (FTA) with them in the new year. That is the substantial outcome of last Friday's maiden participation by Singapore in the Alliance's summit, held as a virtual forum this year. Singapore had been invited to attend as a Candidate Associate State of the Alliance. Host Chile, along with Mexico, Colombia and Peru are the four involved, and collectively are the eighth-largest economy and seventh-largest exporter in the world. In 2019, Singapore's total trade in goods with the alliance was $6.1 billion, a third of its total trade in goods with Latin America.
While three years of government effort for this amount of trade may seem a lot, Singapore is clearly placing a long-term bet on the region. With the exception of Colombia, the other three Alliance nations are members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the high-quality trade agreement midwifed by Japan as a successor to the Trans-Pacific Partnership, which failed when the United States pulled out of negotiations following President Donald Trump's election to office in 2016. Other candidate states for associate status in the Alliance include CPTPP members Australia, New Zealand and Canada, as well as Costa Rica, Ecuador and Panama.