Cosmetic items have been highlighted as one of Peru’s products with the highest growth potential in other Pacific Alliance markets, which include Chile, Mexico, and Columbia, according to a report by BBVA Research.
Alongside cosmetics, the report highlights manufactured food products, beverages, fabrics, paper and cardboard as Peru’s products with the most growth potential.
The news follows the inauguration of the Pacific Alliance Free Trade Agreement, which came into effect on May 1 and eliminates member countries’ tariffs on 92 percent of imports and exports with the aim of developing regional value chains. The last 8 percent is to now be rolled out over the coming three to 17 years in a grace period.
Thanks to the new agreement, 92 percent of goods can now move freely between the four alliance members, which, it is said, the government hopes will help the development of regionally interdependent industries in a vast territory as if it were one place.
According to Mario Illescas, Director of Chile’s Exporters Association, small and medium cosmetics businesses will stand to benefit from the new rules of origin.
Indeed, Peru’s Foreign Minister Ana Maria Sanchez wrote in El Comercio, “Just a few months from end of the current government and revolving presidency of the Pacific Alliance, I am convinced that in the next five years this important process of integration will remain a centerpiece of our foreign policy. This will allow us to face, along with our partners in the alliance, the great challenges of the 21st century.”