Peru and China sign a new Free Trade Agreement

At a recent meeting between Presidents Dina Boluarte of Peru and Xi Jinping of China, the signing of a new Free Trade Agreement (FTA) was announced, which will modernize and adapt the bilateral trade framework to the current demands of international trade.

The negotiation process for the treaty, which consisted of seven rounds between 2019 and 2024, was led by the Ministry of Foreign Trade and Tourism (Mincetur). The head of this ministry, Elizabeth Galdo, highlighted the evolution of international trade between both countries during the last 14 years of economic relations, emphasizing the modernity and ambition of this new agreement.

The treaty covers a total of 12 chapters, which expand benefits for Peruvian companies, especially SMEs, and are expected to attract more Chinese investment to the country. New chapters include Competition Policy, E-Commerce, Global Supply Chain, Cooperation on Standards and Conformity Assessment, and Environment.

The chapters on Rules of Origin, Customs Procedures and Trade Facilitation, Trade in Services, Temporary Entry of Business Persons, Investment, Intellectual Property and Sanitary and Phytosanitary Measures have also been modernized. In particular, the chapter on Trade in Services introduces specific sections to promote investment in the railway transport sector and encourage cooperation in cultural services, with the aim of encouraging Peruvian-Chinese co-productions and the use of Peruvian locations in Chinese productions.

A highlight of the agreement is the inclusion for the first time of a chapter on Global Supply Chain, focused on improving international logistics, which is considered crucial for the competitiveness of Peruvian exporters.

Over the past 10 years, China has established itself as Peru’s main trading partner. In 2023, Peruvian exports to China reached US$23 billion, representing a 10% growth compared to 2022.