The influence of the China FTA in Peruvian trade flows

Peru has signed trade agreements with its most important partners in the last decade, including the FTA with China, which is currently its main trading partner. This research seeks to estimate, through a model of increased severity, the effect of this FTA on trade flows, both at an aggregated and disaggregated level. The results show that the FTA with China has had a positive impact on both exports and imports from Peru, and that the impact on exports has been over twice than on imports. In turn, in the disaggregation by type of goods, commodities have benefited the most. These findings show that the export basket with our main trading partner has not diversified over time, but rather our primary exports have deepened.