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With a bilateral trade of US$8.5 billion during 2017, Chile is Brazil´s second largest trading partner in South America. Consequently, to improve and ease commerce between these major South American powerhouses, Brazil and Chile reached negotiations towards a free trade agreement on October 19th.

The agreement is expected to facilitate trade through a reduction of tariffs and enabling technicalities. Both Brazil and Chile have agreed to remove import tariffs for products migrating from the partner country. This agreement comes in addition to the Economic Complementation Agreement n° 35 (ACE 35) and includes 17 non-tariff related trade issues such as telecommunications, technicalities, sanitary and phytosanitary standards and the protection of intellectual property. For instance, with this accord, Brazil and Chile will not charge international roaming fees anymore. Furthermore, the agreement is expected to facilitate and improve investment flows between the two countries, especially since the agreement also addresses key issues such as corruption, the environment, and labor standards.

Brazil is Chile´s largest trading partner in Latin America, and as of September of this year, the exchange of goods between both countries already amounted to US$7.21 billion. This number can only be expected to continue growing given the new free trade agreement, which is projected to be signed by the end of the year.

Below are some important aspects that were discussed in the creation of the agreement:

Anti-competitive practices

The agreement has a strong emphasis on preventing and eliminating anti-competitive practices. Each party is to have defined, written-down procedures in regard to anti-competitive issues ensuring that intellectual property is protected and that there will be a punishment for those who break the law.

Each country agrees to promote competition along with having a robust legal system to aid in this matter. For instance, both Brazil and Chile are to have clear access to their regulatory system, partially obtained by having websites with laws and guides related to anti-competitive practices, along with the procedures described by law.

Small to Medium Scale Businesses and Start-ups

Both countries agree that there are multiple non-tariff related burdens that largely affect micro, small and medium business including start-ups. Given their sizes, technicalities can impede these businesses from effectively engaging in trade. This is why both countries argue to have all information on a website to allow these companies to more easily access all the requirements to engage in trade. Consults, dialogs, and cooperation are also mentioned.


Telecommunications is another important factor to ease trade between the states. One of the most important aspects mentioned is the right for either party to have access to telecommunication services in a fairly competitive manner.


There is a special initiative to integrate women and sustainable, socially responsible companies in the local and international supply chains. Women are to be integrated, especially as an effort to improve gender equality and in this manner reduce barriers that inhibit the full economic development of women. This includes increasing their access to financing and resources along with having laws that protect ownership.

-Jose Vizcaino




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