(CNN) -- Four of Latin America's most pro-business countries signed a pact forming a bloc for "deep integration" to promote growth and economic competitiveness.
The Pacific Alliance, as it is known, was signed Thursday in Lima by the presidents of Peru, Colombia, Mexico and Chile. Panama also has the option to join to the group.
The pact calls for increased economic integration among the group and the free flow of goods, services, capital and labor among them.
"This is a historic step toward the modernization of our continent and toward the social development and justice for our people," Peruvian President Alan Garcia said.
He added, "We firmly believe that the best way to face the global crisis and assure development, employment and justice is the integration and complementing of our economies and visions for the future."
The new agreement will augment existing free trade agreements among the four countries. According to the Peruvian government, one of the first goals of the new alliance will be to make sure that all of the benefits in existing bilateral pacts are extended to all members.
Peru, Mexico, Chile and Colombia combined represent 55% of Latin American exports and 35% of the continent's GDP, Garcia said.
The countries all have a Pacific coast, which Garcia called the ocean of the future, adding that it leads to large markets in China and Japan.