The Pumas and the Pacific Alliance
WASHINGTON, DC (March 13, 2014) – By embracing political and economic stability, international trade and global integration Chile, Colombia, Mexico and Peru ― the four countries that comprise the Pacific Alliance and that the Bertelsmann Foundation has dubbed the Pacific Pumas ― have emerged as high-growth states that should be key partners of the US and Europe.
That is the conclusion of a new Bertelsmann Foundation study released in Washington, DC today. The presentation of the report, by Bertelsmann Foundation Global Economic Dynamics Project Manager Samuel George, attracted an audience that included former US Secretary of Commerce Carlos Gutierrez and former Colombian Foreign Affairs Minister Carolina Barco.
A subsequent panel discussion featured a high-level diplomatic gathering – Peruvian Ambassador Harold Forsyth, Mexican Ambassador Eduardo Medina Mora, Colombian Ambassador Luis Carlos Villegas and Chilean Chargé d’Affaires Mauricio Hurtado. Inter-American Development Bank (IADB) Manager of Integration and Trade Antoni Estevadeordal joined the four distinguished diplomats on the panel.
After introductory remarks by Bertelsmann Foundation Executive Director Annette Heuser and Council of the Americas/Americas Society Vice President Eric Farnsworth, Samuel introduced “The Pacific Pumas: An Emerging Model for Emerging Markets“, which he called a positive and optimistic story for Latin America. He dubbed the quartet “the Pacific Pumas” for their stealthy efficiency and resourcefulness.
Samuel noted that, unlike in recent Latin American history, the four countries had not missed an opportunity to foster political stability and economic growth. Rather, they have focused in recent decades on three vital goals: 1) Macroeconomic stability, which Samuel called, much to the delight of the audience, “Pumanomics”; 2) democratic maturity; and 3) global integration. These elements, Samuel argued, represent a foundation that could allow these four countries to maintain strong growth for years to come.
The Pacific Pumas have relentlessly pursued these aims and consequently can boast about low inflation rates, growing reserves and reasonable debt levels, which, unlike those of many EU countries, adhere to the relevant Maastricht Treaty criterion.
The Pacific Pumas have relentlessly pursued these aims and consequently can boast about low inflation rates, growing reserves and reasonable debt levels, which, unlike those of many EU countries, adhere to the relevant Maastricht Treaty criterion. Their successful implementation of political, economic and social reforms, which led to their impressive performance, make them strong investment partners for the rest of the world.
Specifically regarding global integration, the Pacific Pumas have also benefitted from a network of free-trade deals with the US and the EU. Unsurprisingly, three of the four countries are part of the Trans-Pacific Partnership (TPP) negotiations.
Samuel nevertheless acknowledged remaining deficiencies in the countries such as significant levels of poverty and crime. While the report was positive, it was, he said, not naïve.
Colombian Ambassador Villegas called the Pacific Alliance the most important Latin American integration effort in the last 100 years. He said the four countries all benefitted from having like-minded governments and being of a similar size. They were regional leaders of reform – political, economic and social – and offered an unusual diversity of opportunities for global businesses. He also said the quartet set an unusual example of countries joining forces to do business together in other regions.
Peruvian Ambassador Forsyth described “The Pacific Pumas” as an “absolutely amazing” report and called for a Spanish translation to spread the word about “Pumanomics”. He reminded the audience that the Pacific Alliance was a purely economic grouping and that it had no political ambitions. Its goals are free circulation of goods, services, capital and people, and serving as a framework for cooperation. He added that the Alliance’s success in attracting foreign direct investment was based on its pursuit of free trade and its implementation of clear rules. Ambassador Forysth, however, echoed Samuel’s point about the work that still lay ahead. The Pumas still had to confront challenges in reducing poverty and crime.
The proof of the Pacific Alliance’s value lies in American export numbers: The US exports more to the Pumas than to the EU.
Mexican Ambassador Mora said the key to the Pumas’ success is they “mean what they say and do what they say” and their effectiveness as a bridge to the Asia-Pacific region. He concurred with Ambassador Forsyth that the countries are like-minded and added that they have remained so despite changes in government. Finally, he noted that the proof of the Pacific Alliance’s value lies in American export numbers: The US exports more to the Pumas than to the EU.
Chilean Chargé d’Affaires Hurtado, whose country inaugurated a new president just two days before, labeled the Pacific Alliance a cornerstone of Latin American cooperation. He said the new administration of Michelle Bachelet would use the grouping as a bridge to the entire Asia-Pacific basin and that further integration of Alliance members would be a key component and a focus of the new government’s work.
The IADB’s Estevadeordal also heaped praise on the Pumas and their accomplishments. He said the Alliance has helped the region adjust to Asia’s growing economic power and influence, and to coming to grips with the global “fragmentation of production”, especially as little intra-regional production integration now exists. He also noted that the cooperation among the four countries created platforms to attract investment and was a natural step in Latin American efforts to integrate globally, especially through free-trade agreements.
The study and its presentation were featured in a variety of Latin American media including El Tiempo in Colombia, Reforma in Mexico and the EFE Spanish-language wire service.