Pacific Alliance
Chile's Finance Minister Larrain speaks while flanked by his regional counterparts during a news conference on the first meeting of the finance ministers of the Pacific Alliance. Reuters

Mexico, Colombia, Chile and Peru are now closer than ever. The four fastest-growing economies in Latin America have completed negotiations to frame their newborn Pacific Alliance as a tool to bring about more integrated trade within the region.

The Pacific Alliance members announced an agreement on Monday in Playa del Carmen, Mexico, for the initial elimination of tariffs on 92 percent of their mutual trade. Tariffs on the remaining 8 percent will also be dropped “progressively and steadily,” said Colombian Commerce Minister Sergio Díaz-Granados.

The agreement is the result of two years of negotiations and meetings, since the bloc was founded in 2011.

“This is a huge milestone,” said Díaz-Granados, calling it “a revolutionary deal in integration in the region.”

The members of the Pacific Alliance have a combined GDP of $2 trillion, which makes up 35 percent of the region’s GDP -- and that percentage will grow once Costa Rica and Guatemala, expected to join within the next 12 months, become full members.

“We are before something that is the most positive we can recall in integration, not only in Latin America but also the world,” said Chilean Foreign Minister Alfredo Moreno.

The Pacific Alliance is a reaction to previous failed Latin American blocs, such as the dying Mercosur. Nonmembers have criticized it in the past; Bolivian President Evo Morales called it a ploy by the United States to counter the left-wing governments in the region and their alliances. The United States has not expressed interest in joining the Pacific Alliance, nor has it attended any of the meetings.