Weekly Report - 14 April 2016 (WR-16-14)

CHILE-URUGUAY | FTA negotiations. On 12 April delegations from the Uruguayan and Chilean governments met in Chile’s capital, Santiago, for the second rounds of negotiations on a bilateral free trade agreement (FTA). The first round was held in Montevideo, Uruguay, in February. According to Andrés Rebolledo, the director general of Chile’s international economic relations directorate (Direcon) and leader of the Chilean delegation, the two sides hope to conclude negotiations by July 2016. This, as Uruguay seeks to become the first member of the Southern Common Market (Mercosur) regional trade bloc to have a differentiated trade agreement with Chile, a member of the rival Pacific Alliance trade bloc. Rebolledo revealed that the agreement being negotiated by the two countries would incorporate features of the economic complementation trade agreement that Chile has with Mercosur, which has been in effect for the last 20 years but also “incorporates new topics that will allow for the strengthening of ties”. The topics reportedly covered in the Santiago negotiating round included: access to goods; rules of origin; trade in services; sanitary and phytosanitary measures; technical obstacles to trade; cooperation; environmental regulation; intellectual property; facilitation of trade; labour and gender rights. On 1 April the two countries already signed a new joint agreement on the prevention of both tax evasion and double taxation for bilateral trade and investment flows, which was said to help promote bilateral investments in particular. According to Direcon figures, total bilateral trade stood at US$349m in 2015, of which Chilean exports to Uruguay accounted for US$149m. While this bilateral trade figure may be small, Direcon’s figures also show that Uruguay is the sixth most popular destination for Chilean capital investments, which reached a cumulative total of some US$3.92bn in December 2014, equivalent to 3.9% of total Chilean capital investments abroad since 1990.

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