On November 1, the Optimization Protocol of the Free Trade Agreement (FTA) between the Government of the People’s Republic of China and the Government of the Republic of Peru (hereinafter referred to as “the Optimization Protocol”) officially entered into force. The head of the Department of International Trade and Economic Affairs of MOFCOM gave a briefing on the entry into force of the Optimization Protocol.

I. Background

China and Peru are comprehensive strategic partners with highly complementary economies. China is Peru’s largest trading partner, largest export market and largest source of imports worldwide, while Peru is China’s fourth largest trading partner in Latin America and an important investment destination.

China-Peru FTA was signed in April 2009 and officially entered into force in March 2010. It is China’s first comprehensive free trade agreement with a Latin American country. The implementation of the agreement has strongly promoted the development of bilateral economic and trade relations. In 2025, bilateral trade between China and Peru reached USD 50.4 billion, nearly eight times the USD 6.4 billion in 2009. In November 2018, the two sides announced the launch of negotiations to upgrade the China-Peru FTA. On June 28, 2024, President Xi Jinping and the then President Dina Boluarte of Peru announced at their meeting in Beijing the substantial conclusion of the negotiations to upgrade the China-Peru FTA. On November 14, 2024, the two sides formally signed the Optimization Protocol. Through joint efforts, the two sides recently confirmed that they had completed their respective domestic ratification procedures, and the Optimization Protocol entered into force on November 1, 2026.

II. Main Highlights of the Optimization Protocol

The entry into force and implementation of the Optimization Protocol is a concrete action by China to firmly uphold the rules-based multilateral trading system, demonstrating China’s determination to work with all countries through FTA negotiations to jointly safeguard multilateralism and free trade. The entry into force and implementation of the Optimization Protocol will also promote China-Peru economic and trade relations, enrich the China-Peru comprehensive strategic partnership, create a more favorable business environment and more trade and investment cooperation opportunities for enterprises of the two sides, and bring more tangible benefits to the peoples of both countries.

First, it keeps pace with the times and comprehensively raises the level of rules and commitments. Building on the China-Peru FTA, the Optimization Protocol adds, in the form of stand-alone chapters, new topics such as standards cooperation, competition policy, e-commerce, global supply chains, and environment, and improves and refines the provisions of existing chapters including rules of origin, customs procedures and trade facilitation, sanitary and phytosanitary measures, intellectual property rights, trade in services, temporary entry for business persons, and investment. Among them, the chapter on global supply chains includes provisions encouraging multimodal transport and promoting the development of foreign trade logistics corridors and infrastructure, which is an innovative step by the two sides under the FTA and demonstrates the two countries’ commitment to jointly maintaining the stability and smooth functioning of supply chains. The chapter on standards and conformity assessment cooperation establishes a dedicated cooperation mechanism and puts forward a list of indicative cooperation areas, which will help build a platform for the two countries to carry out mutual recognition of standards and cooperation on standards and reduce trade costs for enterprises of both countries.

Second, it pursues mutual benefit and win-win outcomes and continuously improves the trade and investment environment. In terms of trade in goods, it incorporates provisions on electronic customs systems and completes the conversion of product-specific rules of origin. It sets out detailed provisions on responses to customs declaration-related requests, information exchange, release of goods, express consignments, and clearance of perishable goods. It also raises requirements for the transparency of laws and regulations related to sanitary and phytosanitary measures of the two countries, and establishes a consultation mechanism to promptly resolve relevant technical issues. In terms of services and investment, it adds four specific sectoral annexes on professional services, transport services, cultural and audiovisual services cooperation, and telecommunications services, raising the level of cooperation in the services sector. It incorporates provisions on expeditions application procedures for the entry of business personnel to improve visa processing efficiency, substantially improves the investment dispute settlement mechanism and refines provisions on most-favored-nation treatment and expropriation, providing strong guarantees for promoting two-way investment.

Third, it is future-oriented and keeps deepening opening up and cooperation. The two sides agreed to launch subsequent negotiations on trade in services and investment based on a negative list approach within two years after the entry into force of the Optimization Protocol, to further enhance the level of openness in services trade and investment between the two countries and continuously tap the potential of bilateral trade and investment. In addition, the two sides are committed to reviewing the competition chapter every two years to assess the possibility of making higher commitments.

III. Work Related to High-Quality Implementation of the Optimization Protocol

China has made all preparations for implementation in accordance with the provisions of the agreement to ensure its smooth implementation. The text of the Optimization Protocol has been published on the China FTA Network (http://fta.mofcom.gov.cn), where enterprises, institutions and individuals may access specific details, and make inquiries on relevant issues. In addition, the General Administration of Customs has issued the Revised Measures of the Customs of the People’s Republic of China on the Administration of Origin of Imported and Exported Goods under the Free Trade Agreement between the Government of the People’s Republic of China and the Government of the Republic of Peru.

Going forward, MOFCOM will work with relevant agencies and local authorities to strengthen outreach and services for enterprises and continue to ensure the smooth implementation of the agreement. It will closely monitor the implementation and impact of the agreement, and maintain coordination and communication with foreign counterparts through the FTA implementation mechanism to promote high-quality implementation and help enterprises better benefit from the agreement. (Released on November 1)