Civil Society, Economy & Trade, Headlines, Latin America & the Caribbean

SOUTH AMERICA: The Big Challenges of Regional Integration

Carlos Tautz

COCHABAMBA, Bolivia, Dec 8 2006 (IPS) - The second summit of the South American Community of Nations is facing several major challenges: the integration of physical and energy infrastructure for the development of the region, overcoming the high levels of inequality and poverty, and recognising and encouraging the diverse cultural identities of the region’s population.

The draft of the final declaration of the Friday-Saturday summit taking place in the central Bolivian city of Cochabamba is nearly complete, and is organised around these main themes. An action plan for achieving the goals outlined has also been drawn up.

“We will thus be able to build the world’s fourth largest bloc, after NAFTA (North American Free Trade Agreement), the European Union, and ASEAN (Association of Southeast Asian Nations),” Chilean diplomat Luis Maira, who helped draft the declaration, told IPS.

It will not be an easy task, and not only because the goals are ambitious. It is not yet clear whether all of the 12 South American presidents will even throw their real support behind the South American Community of Nations, despite their declared backing for regional integration.

Argentine President Néstor Kirchner, for example, did not confirm his attendance at the summit until the last minute. In fact, not even the presence of his Foreign Minister, Jorge Taiana, was announced ahead of time.

The uncertainty about whether Kirchner would attend arises in part from the long-term love/hate relationship between Brazil and Argentina. Brazil’s President Luiz Inácio Lula da Silva is one of the driving forces behind the creation of the South American Community of Nations, which Brasilia sees as one of its foreign policy priorities.

But the rivalry between Argentina and Brazil has not stood in the way of important steps by both countries towards economic and financial integration in South America. “In January 2007, Argentina and Brazil will begin trading with each other using only the peso and the real (their respective local currencies), and not the dollar,” reported Argentine Foreign Ministry official Agustín Colombo.

That measure will favour the proposed creation of a development bank by countries in the region, using only local currencies. The initiative also coincides with the projected establishment of a Banco del Sur (Bank of the South) by the region’s central banks, especially those of Argentina and Venezuela.

Colombo also said the deputy foreign ministers meeting in Cochabamba agreed that the next two South American Community summits would be held in Colombia and Chile, although no specific dates have been set.

In a meeting with representatives of the parallel Social Summit for the Integration of the Peoples, Brazil’s Deputy Foreign Minister Samuel Pinheiro-Guimaraes said the implementation of the South American Community would take into account “pressure that governments receive from social organisations.”

The Social Summit is being held by civil society movements and non-governmental organisations from a number of Latin American countries Wednesday through Saturday in Cochabamba.

Its aim is to get the official summit to discuss concerns and issues that are not normally taken into consideration in international agreements, such as migration, social justice, and gender equality.

Nearly 3,000 people, in large part representatives of indigenous movements from Bolivia and, to a lesser extent, other Latin American countries, are taking part in the Social Summit.

“We are mobilising to set forth demands as well as proposals,” said Argentine activist Graciela Rodríguez with the Hemispheric Social Alliance, which is organising the parallel civil society meet.

The aim of South American integration appears to have gained strength in the wake of the election of a number of progressive governments in Latin America. But it is not a new idea, noted Maira.

“This is the region’s third historic opportunity,” said the Chilean diplomat. “The first was in 1826, when (independence hero) Simón Bolívar convened a meeting in Panama to call for political integration.”

“Later, in 1959, we tried to create a common South American market, with a priority on the economy. Now, as the South American Community, interest in political and economic integration will help fuel coordination of other priorities as well,” he added.

But although the shared interest of a number of governments that hold certain common ideals like opposition to the “neo-liberal” free-market policies that took hold in the region in the 1990s is a factor in favour of South American integration, more than that is needed.

“The neo-liberalism that oriented the 34 governments of the Americas in 1994, when the project for the Free Trade Area of the Americas (FTAA) was launched, left its mark on the productive architecture of all of the countries in the region,” said Professor Edgardo Lander from Venezuela’s Central University.

“The economies of all of the countries are oriented towards exporting to the United States and Europe and towards competing with each other, which stands in the way of true integration,” said Lander. The process proposed now is much more ambitious and difficult, “because it is not limited to trade aspects,” he added.

“We must think about the reorganisation of the development model applied in each country, in order to put higher priority on developing the domestic market, and rethink the way we relate to the environment, how we produce, and how we consume energy,” he argued.