The Pacific Alliance – Singapore Free Trade Agreement (PASFTA) has entered into force on 3 May 2025 for Singapore, Chile and Peru. The PASFTA is Singapore’s 28th Free Trade Agreement.
The Pacific Alliance – Singapore Free Trade Agreement (PASFTA) has entered
into force on 3 May 2025 for Singapore, Chile and Peru. The PASFTA is Singapore’s
28th Free Trade Agreement.
Established in 2012, the Pacific Alliance (PA) is a Latin American trade bloc
comprising Chile, Colombia, Mexico and Peru. Combined, the PA represents the 9th
largest economy in the world and a total population of 235 million. About 100
Singapore companies are operating across the Pacific Alliance markets. Singapore is
already FTA partners with Chile and Mexico through the existing Comprehensive and
Progressive Agreement for Trans-Pacific Partnership (CPTPP), and with Peru through
the CPTPP and the bilateral Peru-Singapore FTA.
Singapore’s bilateral trade with the Pacific Alliance in 2024 was S$12.5 billion (US$9.6 billion), accounting for more than a third of Singapore’s total trade with the Latin American and Caribbean region.
The top traded products include electric machinery, refined metal products, cocoa products, wine and seafood.
Then-Minister for Trade and Industry Gan Kim Yong and his counterparts from
the Pacific Alliance member states signed the PASFTA at the 16th PA Summit in
Colombia on 26 January 2022. Following Singapore’s and Peru’s ratification of the
Agreement in July 2022 and February 2023, respectively, Chile ratified the Agreement
on 4 March 2025, bringing the Agreement into force for the three Parties first. The
PASFTA will enter into force for Colombia and Mexico upon the completion of their
respective ratification procedures
Key Benefits of the PASFTA
1. Trade in Goods. There will be no tariffs imposed on the majority of tariff lines. In
particular, Colombia – once it ratifies the Agreement – will reduce or eliminate
tariffs on 85.7% of tariff lines.
2. Rules of Origin. Businesses can use materials originating in any PASFTA Party to
contribute towards a good’s originating status, so that their exports can qualify for
preferential tariff treatment more easily, subject to certain conditions.
3. Customs Procedures and Trade Facilitation. There will be improved transparency
in customs procedures and integrity in customs administrations through simplified
customs procedures and enhanced trade facilitation provisions, including for
express consignments and perishable goods.
4. Technical Barriers to Trade. There will be transparent and non-discriminatory rules
for developing technical regulations, including rules that will facilitate the
acceptance of the results of conformity assessment procedures from the
conformity assessment bodies in any of the PASFTA Parties.
5. Investment. The PASFTA provides basic investment protection found in other
investment-related agreements, including national treatment and most-favoured-
nation treatment. Investments will be treated fairly and equitably and will be given
protection and security in accordance with customary international law.
6. Trade in Services and Investment. Includes core obligations found in the WTO and
other trade agreements, such as national treatment, most-favoured nation
treatment, and market access. Singapore service providers can enjoy lower
operating costs as they need not establish or maintain a local representative office
in the PA for sectors which have been committed for liberalisation. Service
providers can also be assured of efficient transfers and payments for cross-border
supply of services.
7. International Maritime Transport Services. This chapter aims to strengthen
cooperation in maritime transport services between Singapore and the PA through
the exchange of best practices and knowledge, and education and training
opportunities.
8. Temporary Entry. Singapore business visitors can enter Chile and Colombia for up
to 90 days; Mexico for up to 180 days; and Peru for up to 183 days. Singapore
investors can enter Peru for up to 90 days; Chile and Mexico for up to 1 year; and
Colombia for up to 3 years.
9. Telecommunications Services. Businesses can benefit from a pro-competition and
market-based regulatory environment and disciplines that prevent anti-competition
behaviours.
10. Electronic Commerce. This chapter contains comprehensive commitments on
cross-border data flows and location of computing facilities. Companies which sell
products with embedded software would not be obliged to release their source
code, except for legal reasons. There are also safeguards for the protection of
personal information.
11. Government Procurement. Singapore and the PA have committed to core
disciplines of national treatment and non-discrimination. Relevant information will
be published in a timely manner so that suppliers have sufficient time to obtain the
tender documentation and submit a bid. Suppliers can be assured that their tenders
will be treated fairly, impartially, and with confidentiality.
12. Competition. Singapore and the PA are to maintain legal regimes that prohibit anti-
competitive business conduct so that businesses can enjoy fair competition.
Consumers will also be protected from fraudulent and deceptive commercial
activities.
13. Economic and Trade Cooperation. The PASFTA parties have agreed to undertake
and strengthen economic and trade cooperation activities between them,
particularly in the following sectors: (i) industrial and services; (ii) innovation,
science, and technology, including information and communications technology;
and (iii) trade infrastructure, transport, and urban mobility infrastructure.
14. Small and Medium Enterprises (SMEs). Singapore and the PA have agreed to
explore ways to promote an environment that supports the development, growth,
and competitiveness of SMEs.
15. Good Regulatory Practices. Businesses can benefit from an open, fair, and
predictable regulatory environment as Singapore and the PA have committed to
achieving a coherent regulatory approach by encouraging transparency and
coordination across each government
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