Development & Aid, Economy & Trade, Headlines, Latin America & the Caribbean | Analysis

CHALLENGES 2006-2007: South American Integration – or Disintegration?

Analysis by Blanca Rosales, Special to IPS *

LIMA, Jan 3 2007 (IPS) - In 2006, an election year in a number of Latin American countries, South American integration schemes experienced crises of varying intensity, whose outcomes are not yet clear. Most were triggered by complaints of the ineffectiveness of regional trade blocs.

The Andean Community was most heavily affected. In April, Venezuela announced that it was pulling out of the 37-year-old bloc, which led to a reduction in personnel in the bloc’s institutions and in its activities.

The decision by Venezuela, previously the bloc’s biggest contributor, was followed by declarations and political gestures by representatives of several of the countries that remain in the Andean Community: Bolivia, Colombia, Ecuador and Peru.

One of the developments that has most clearly pointed to the degree of deterioration suffered by the bloc is the fact that the position of secretary-general – who is to be Ecuadorian this time around – has not been filled since July. Nor have Bolivia or Peru named their two national directors. A lack of interest and difficulties in reaching consensus are apparently the reasons.

Bolivian President Evo Morales, whose country currently holds the rotating presidency of the Andean Community, has taken a cautious stance with respect to the continuous criticism of the bloc voiced by Venezuelan President Hugo Chávez, who has even urged his close ally Morales to pull out as well, arguing that the bloc “is already dead; it was killed by the free trade agreements (that Peru and Colombia negotiated) with the United States.”

However, Bolivian Foreign Minister David Choquehuanca has announced that as of this month, his country will seek to convert its associate member status in Mercosur (Southern Common Market) into full membership. Although the minister hastened to add that the decision did not mean Bolivia would abandon the Andean Community, it remains to be seen how Bolivia plans to handle membership in both blocs.

Ecuadorian president-elect Rafael Correa, meanwhile, has voiced increasingly harsh criticisms of the Andean Community.

Although during the early December South American summit in Cochabamba, Bolivia, Correa joined forced with Morales to ask Venezuela to return to the Andean Community, the Ecuadorian president-elect’s position has hardened to the point that he has stated that his country would take a close look at its membership in the bloc, and that if it did not see results after one year, “we will all leave.”

“For how many years, how many decades has the Andean Community been in existence, and how far have we advanced?” Correa remarked at a press conference after a recent visit to Venezuela, where he met with Chávez.

“What we are feeding is a bloated bureaucracy in Lima, with high-sounding declarations that serve no purpose,” added the president-elect, who takes office on Jan. 15.

Nor did South America’s biggest trade bloc, Mercosur – made up of Argentina, Brazil, Paraguay, Uruguay and Venezuela – fare so well in 2006.

Added to the ongoing conflict between Argentina and Uruguay over a paper pulp mill being built on the Uruguayan side of a border river were complaints by the two smallest members, Paraguay and Uruguay, that they are sidelined and ignored when it comes to decision-making, and criticism of Mercosur by Chávez, whose country just joined the bloc.

Even Morales hinted in late December at the possibility of creating a new bloc, together with Venezuela and Ecuador, in which integration would “serve the people.”

IPS asked political analyst Carlos Urrutia about the prospects for regional integration. Urrutia served as Peruvian ambassador to Venezuela under the administration of Alejandro Toledo (2001-2006), when relations between the two countries reached a new low, leading to the recall of ambassadors.

The analyst said “there is a serious crisis, the product of instability, to which is added ‘the Chávez factor’. There is crisis in Mercosur, the Andean Community and the South American Community, on which progress has come to a halt.”

“An initial diagnosis is that there is a regional integration crisis and that the countries are seeking individual strategies to their own benefit,” he said.

“The political map of Latin America is being redrawn, but the elections in the main actors came to an end in December, which means that they will only begin to operate in terms of integration issues in 2007, and that they are moving towards a reworking of their alliances and understandings,” he said.

“Take the Andean Community, for example: Venezuela left, Chile is rejoining, and the bloc is no longer what it was. In Mercosur, Venezuela has joined, internal conflicts are heating up, and it is also a different bloc than it was in the past,” he added.

“A scenario of completely different alliances is taking shape, in which trade flows are stronger than political convergences,” said Urrutia.

To illustrate, he pointed to Argentina and Venezuela, which have strong ties due more to their bilateral trade than to the fact that they both have left-leaning governments. Relations are not so close between Argentina and Bolivia, for example, even though their governments are also ideologically compatible, he added.

Urrutia said leadership in Brazil is also in crisis because in his second term, which began Monday, Luiz Inácio Lula da Silva will not be the same president as he was in the previous four years, given the conditions imposed on him by big business.

“One example is that he was forced by the powerful Brazilian business community to distance himself from Morales,” he noted.

Chávez’s attempts to influence the region’s shift to the left have had uneven success. The failed presidential candidates “Ollanta Humala (in Peru) and Andrés López Obrador (in Mexico), and even Correa, who had to distance himself from Chávez to win the elections in Ecuador, clearly show that the tendency is not linear,” he said.

The rightwing “Álvaro Uribe won (reelection in Colombia) and (former Peruvian president Alejandro) Toledo had the full support of Bush and the Latin American right when he left office” in July, he added.

In Urrutia’s opinion, “the fate of today’s South American left is that it will shift towards the centre. It wins with the votes of the lower-income sectors, but then it opens up towards the centre to be able to negotiate with the right and to gain in governability. That is why the South American left will become increasingly centrist.”

In the view of international analyst Juan Mariátegui, the representative to the Andean Parliament for Humala’s Nationalist Party, Peruvian President Alan García is putting a priority on relations with the United States and Chile at the expense of Andean and South American integration.

“By doing that, García has turned his back on the idealism of APRA (the ruling party), which promoted ‘indoamericanism’àand on the Latin American integrationist focus of its historical leaders, like Andrés Townsend,” he said.

Mariátegui based his complaint on something that he himself has experienced. Under international treaties and national legislation, the members of the Andean Parliament have the same status as national lawmakers, he said. In Peru, however, they have no office, budget, staff or even the minimum conditions needed to carry out their work.

That situation has led to an odd arrangement in the national budget for 2007. While Congress will continue paying the salaries of the five Andean Parliament members – who were directly elected for the first time this year -their operating expenses will be covered by the Foreign Ministry.

That is not the case of the members of the Andean Parliament in Ecuador, Bolivia and Colombia, whose salaries, staff and operating expenses are included in the budgets of their respective legislatures.

Former Peruvian legislator Anel Townsend, who is currently a member of the Latin American Parliament’s consultative council, says governments should “make efforts to promote integration mechanisms for questions like the environment or the Millennium Development Goals.”

Despite the tendency towards more extreme positions and the weakening of some groups to strengthen others, due fundamentally to the different countries’ varying relations with the United States, the ongoing talks with the European Union, which has insisted on only bloc-to-bloc negotiations, will exercise a centripetal force on Andean Community nations like Bolivia and Ecuador, which need ties with the European market, said Townsend.

“They have more to lose than to gain if they distance themselves from the Andean Community,” she said.

Initiatives like the trans-oceanic route being created by Peru and Brazil are models of “anchors” that can help preserve regional integration blocs, she added.

The Initiative for the Integration of Regional Infrastructure in South America (IIRSA) is another example of joint projects, involving 12 countries.

“The leadership of the South American Community without a doubt corresponds to Brazil, and Lula is a bridge for dialogue and closer ties among countries, at a time when diasporas and confrontations are the norm,” she remarked.

* Rosales, a Peruvian journalist, has directed three media outlets in her country, and was granted the Courage in Journalism Award by the International Women’s Media Foundation in 1998. She is currently a media consultant in the Andean region.