AGREEMENTS AND NEGOTIATIONS

Today, Mexico is the country with the largest network of Free Trade Agreements (FTA’s) in the world. Mexico’s network of FTA’s with 43 countries, in three different continents, represents a unique opportunity to foreign investors, offering preferential access to a potential world market of more than one billion consumers.

Mexico’s strategic geographical location, between the Atlantic and the Pacific Oceans, and connecting north and south America, makes of it an ideal hub for world-wide production and trade.

Mexico’s strategy is to continue expanding its network of FTA’s to diversify its export markets and to attract Mexican and foreign enterprises to invest and reap the benefits of joint production in a strategic location.

Mexico’s network of FTA’s include:

1992 – Mexico-Chile FTA: This treaty was Mexico’s first FTA. In 1999, the original agreement was complemented with additional topics including trade in services, government procurement, dispute settlement procedures and intellectual property. By 2005, as a result of the FTA, total trade between Mexico and Chile had increased twelve-fold since 1991, reaching over US$2.2 billion.

1994 – NAFTA between Mexico, United States and Canada: Since it came into force in 1994, the North American Free Trade Agreement (NAFTA) has been a key instrument in increasing trilateral trade. Between 1994 and 2005, total trade between the three countries grew by 128 percent to reach US$772 billion. Today, the North American region is one of the most dynamic and integrated economic areas in the world. In 2005, bilateral trade between Mexico and the US amounted US$288 billion, while total trade during the same period between Mexico and Canada amounted US$18 billion.

1995 – G3 FTA between Mexico, Venezuela and Colombia: This FTA has helped to build stronger ties between Mexico and South America. Trilateral trade has increased by 271 percent since 1994. Such results have helped Mexico to strengthen its position in those markets, with the result that, today, total trade recording US$3.3 billion.

1995 – Mexico-Costa Rica FTA: This was Mexico’s first FTA with a Central American country. The FTA has yielded significant results. Total trade multiplied by ten between 1994 and 2005, reaching US$1.2 billion.

1995 – Mexico-Bolivia FTA: This FTA has helped to increase Mexico’s presence in the Andean market. With this agreement, total trade between Mexico and Bolivia increased by 130 percent between 1995 and 2005.

1998 – Mexico-Nicaragua FTA: Immediately upon this agreement came into force, 45 percent of Mexico’s total exports to Nicaragua entered duty free, while 77 percent of Nicaragua’s exports to Mexico entered duty free, (recognizing the differences between the economies of each country). By 2005, total trade between both countries had reached US$465 million.

2000 – Mexico-EU FTA: This treaty created the first free trade area between Europe and the American continent. This FTA is a forward-looking and comprehensive agreement that offers increased opportunities for Mexican and European enterprises to create links, through the establishment of strategic alliances and the promotion of investments. In 2005, total trade between Mexico and the EU amounted US$34 billion. This FTA gives Mexico the opportunity to increase its trade with a potential market of 455 million people.

2000 – Mexico-Israel FTA: This FTA has helped to increase Mexico’s presence in the Israeli market. With this agreement, in 2005 total trade between Mexico and Israel reached US$456 million.

2001 – Mexico-European Free Trade Association FTA: TThe Mexico-EFTA treaty, signed with Norway, Iceland, Switzerland and Liechtenstein was negotiated on the basis of the Mexico-EU FTA. This FTA makes Mexico the only country in Latin America to have concluded free trade agreements with the vast majority of the world’s highest income countries. In 2005, total trade between Mexico and EFTA countries reached the US$2.3 billion.

2001 – Mexico-Triangulo del Norte FTA between Mexico, El Salvador, Guatemala and Honduras: This treaty has helped to increase Mexican exports to Central America. In 2005 total trade between Mexico and Triangulo del Norte reached US$1.8 billion.

2004– Mexico-Uruguay FTA: This FTA has helped to increase Mexico’s presence in the Mercosur market. In 2005 total trade between Mexico and Uruguay reached US$899 million.

2005– Mexico-Japan EPA: Mexico and Japan are complementary partners. Mexico and Japan have succeeded in concluding a mutually satisfactory, balanced and high standard agreement. Since the EPA came into force, the bilateral trade has increased by 21.5% in regard to the same period of 2004 (April 2005 - January 2000).

Mexico also plays a central role in several important multilateral forums. Mexico’s network of FTA’s has helped to strengthen its position in these forums and to play an increasingly leadership role.

World Trade Organization (WTO): This is the world’s leading trade organization, created in order to aim to help trade flow as freely as possible, achieving further liberalization gradually through negotiation and setting up impartial means of settling trade disputes. Mexico has played and will continue to play an important role in the Doha Development Round.

Asia Pacific Economic Cooperation (APEC): One of APEC’s main goals is to contribute to the development of the region, as well as to support a free international trade system. Mexico was APEC’s 2002 chair, and hosted the “APEC’s 14th Ministerial Meeting” and the “10th APEC Economic Leaders Meeting” both held in Los Cabos, Mexico on October 2002.

Latin American Integration Association (ALADI): A member of this regional organization since 1980, Mexico has been active in promoting closer commercial integration within the region, through the negotiation of partial scope trade agreements with other members.

Free Trade Area of the Americas (FTAA): This regional forum aims to unite the economies of the Western Hemisphere into a single free trade area. It brings together 34 countries and seeks to create a balanced, comprehensive and fair free trade agreement, based on the rules and principles of the WTO.

Organization for Economic Co-operation and Development (OECD): he OECD provides a forum for analysis and co-operation and was created with the aim of expanding production, increasing jobs and promoting economic harmonization, with a particular emphasis on helping developing countries. Mexico joined the OECD in 1994.