The EU-Chile Interim Trade Agreement (ITA) came into force after Chile’s ratification process was completed. Signed in December 2023, the ITA aims to enhance business competitiveness on both sides and support the development of net-zero economies.
Negotiations to modernise the EU-Chile Association Agreement, which has been in place since 2003, took place between 2017 and 2022. The political conclusion was reached on 9 December 2022 and the new Agreement was signed on 13 December 2023.
The ITA will support initiatives under the Global Gateway, particularly in developing critical lithium and copper raw materials value chains and green hydrogen production. It aims to strengthen cooperation on global challenges like supply chain risks and climate change while promoting shared values such as sustainable trade and gender equality.
Key benefits of the ITA include the elimination of tariffs on 99.9% of EU exports and favourable conditions for EU goods in the Chilean market, a dedicated Energy and Raw Materials chapter to ensure reliable access to critical materials and support Chile’s industrial policies, easier market access for EU companies in areas like delivery, telecommunications, and financial services, equal treatment for EU investors in Chile and improved access for EU companies to government contracts in Chile, Latin America’s fifth-largest economy.
Overall, the ITA will deepen EU-Chile trade and investment relations, generating new opportunities for sustainable business practices.
“The European Union continues to create effective partnerships around the world, supporting both our economic growth and our economic security. I warmly welcome the entry into force of our Interim Agreement with Chile – the third biggest EU trading partner in Latin America. I am confident that economic operators on both sides will benefit from this Agreement from day one. It will help us diversify our supply chains, while creating new opportunities for our businesses, including SMEs. With this deal, we will take economic relations between the EU and Chile to an even higher level, and send a strong signal of cooperation between like-minded, trusted partners in times of geopolitical uncertainty,” Maroš Šefčovič, Commissioner for Trade and Economic Security; Interinstitutional Relations and Transparency, said.
A strong commitment to sustainability
The Agreement aims to enhance sustainable bilateral trade and investment between the EU and Chile through several key initiatives. It will confirm commitment to International Labour Organization (ILO) standards and the Paris Agreement on climate change. It will establish the Trade and Gender Chapter, a pioneering section in EU trade agreements that commits to eliminating discrimination against women. The Sustainable Food Systems Chapter will focus on improving the sustainability and resilience of food supply chains.
Additionally, the Agreement provides legal certainty for EU businesses by protecting intellectual property rights and safeguarding 234 specific European and Chilean food products as geographical indications.
The ITA is currently in force, while the Advanced Framework Agreement (AFA) will begin once all EU Member States ratify it, after which the ITA will be discontinued.
