The presentation exposes the state of regional integration initiatives in Latin America during the second decade of the 21st century.

1. INTERNATIONAL RELATIONS
OF LATIN AMERICA
Topic 4. Regional Integration in Latin America:
Recent trends
Dr. Jacqueline LAGUARDIA MARTINEZ
Jacqueline.Laguardia-Martinez@sta.uwi.edu

2. “Traditional” Regional Integration
ASOCIACIÓN LATINOAMERICANA DE INTEGRACIÓN (ALADI)
COMUNIDAD ANDINA DE NACIONES (CAN)
SISTEMA DE INTEGRACIÓN CENTROAMERICANA (SICA)
MERCADO COMÚN DEL SUR (MERCOSUR)

4. Latin American Free Trade Association (LAFTA)
• It was a first step in the process of Latin American regional integration.
• 1960: Treaty of Montevideo
• Members (7): Argentina, Brazil, Chile, Mexico, Paraguay, Peru and Uruguay
• LAFTA intended to establish a free trade among member states in the space of
twelve years.
• The project was very much an idea of the Economic Commission for Latin
America and Caribbean (ECLAC), looking at industrialization and the needs of
the opening markets in the region, as well as the need to develop better
mechanisms for the facilitation of trade and transfer of payments.
• The LAFTA project did not succeed and no longer exists.
• In 1980 it was replaced by a more flexible agreement, the ALADI.

5. Asociación Latinoamericana de Integración (ALADI)
• 1980: Treaty of Montevideo
• Members (13): Argentina, Bolivia, Brazil, Chile, Colombia, Cuba, Ecuador,
Mexico, Panama, Paraguay, Peru, Uruguay and Venezuela
• General principles:
a. pluralism in political and economic matters;
b. progressive convergence of partial actions towards the formation of a Latin
American common market;
c. flexibility;
d. differential treatment based on the level of development of the member
countries;
e. and multiplicity in the forms of agreement of commercial instruments

6. Comunidad Andina (CAN)
• It is a Free Trade Zone
• Origins in 1969: Cartagena Agreement (Andean Pact)
• In 1996, it was agreed to change the name
• Members (4): Bolivia, Colombia, Ecuador and Peru (Chile and Venezuela were
former Members)
• Purpose: Achieving more rapid, better balanced and more autonomous
development through Andean, South American and Latin American integration
To move ahead in deepening an integral integration process that will
contribute effectively to sustainable and equitable human development.
• Colombia and Peru: Supporters of the New Regionalism and the North-South
links
• Ecuador and Bolivia: Against Washington Consensus, South-South cooperation

7. Central American Common Market (CACM)
• In 1951, the Organization of Central American States (ODECA) is created as a
political forum to promote cooperation and integration.
• In 1960, El Salvador, Guatemala, Honduras and Nicaragua sign the General
Treaty on Central American Economic Integration, which creates the basic
framework for economic integration and establishes the Central American
Common Market (CACM).
• The General Treaty provided for the establishment of a common market and a
customs union.
• Costa Rica acceded to the treaty in 1962.
• At the end of 60´s, political problems caused Honduras to leave the CACM.
• In 80´s, civil wars and external debt problems caused major payment
difficulties and interregional trade contracted by more than 50 per cent
between 1980 and 1986.

8. Sistema de Integración Centroamericana (SICA)
• 1991: Protocol of Tegucigalpa (+ Panama)
• 1993: Protocol of Guatemala to create a Customs Union and a Monetary Union
without setting a specific deadline
• 2000: Belize joins
• 2013: DR joins (8 Members)
• Fundamental objective: To achieve the integration of Central America, to establish it
as a region of peace, freedom, democracy and development
• Main issues: democracy, security, freedom, economic union and strengthen the
Central American financial system, unique foreign policy, environment
• Obstacles:
1. Poverty, exclusion, inequality
2. Violence (Gangs)
3. Political instability

9. Mercado Común del Sur (MERCOSUR)
• 1991: Treaty of Asunción
• Members (5): Argentina, Brasil, Paraguay, Uruguay, Venezuela and Bolivia
• Purpose: Achieving a Common Market of the South
1. Free movement of goods, services and factors of production between countries through, inter
alia, the elimination of customs duties and non-tariff barriers on the movement of goods, and
any other equivalent restrictions;
2. The establishment of a common external tariff and the adoption of a common trade policy in
relation to third States or groups of States and the coordination of positions in regional and
international economic and trade fora;
3. The coordination of macroeconomic and sectoral policies between Members in agricultural,
industrial, fiscal, monetary, foreign exchange and capital, services, customs, transport and
foreign trade and other communications sectors to ensure suitable conditions of competition
between the States Parties;
4. The commitment of States Parties to harmonize their legislation in relevant areas in order to
strengthen the integration process.

10. https://www.youtube.com/watch?v=xFvZzBah9Y4

11. Latin American and the Caribbean Economic System (SELA)
• Founded in 1975
• To promote economic cooperation and social
development between Latin American and the
Caribbean.
• Venezuela contributes the largest share of the
budget.
• To restructure international trade in basic
commodities to raise developing states'
export values, stimulate industrial
development, improve the negotiating power
of the member states, and plan joint
economic strategies.

12. The end of the Cold War: Open Regionalism
• How to achieve compatibility between the explosion of regional
trading arrangements and the global trading system as embodied
in the World Trade Organization
• To increase trade between members through the achievement of
a common external tariff
• To set a gradual economic and policy convergence among
countries
• Integration as support for improving international competitiveness
• Washington Consensus influence

13. New kind of regionalism (beginning 21st century)
• Progressive governments are on the rise in Latin America.
• Globalization encourages the search of alternative
integration frameworks.
• It reflects different socio-economic conditions, values and
ideological positions. It emphasis cooperation and
complementarity (South-South cooperation).

14. •Bolivarian Alliance for the Peoples of Our America
(ALBA) in 2004
•Union of South American Nations (UNASUR) in 2008
•Community of Latin American and Caribbean States
(CELAC) in 2011
•The Pacific Alliance in 2011

15. Bolivarian Alliance for the Peoples of Our America (ALBA)
• 2004, Alternativa Bolivariana para las Américas, transformed in 2009 in
Alianza Bolivariana de los Pueblos de Nuestra América - Tratado de
Comercio de los Pueblos (ALBA-TCP)
• Membership (9 Members): 2004 Cuba and Venezuela, 2006 Bolivia, 2007
Nicaragua, 2008 Dominica and Honduras, 2009 St. Vincent and
Grenadines and Ecuador, Antigua and Barbuda, 2013 Saint Lucia
(Multiple membership of its members)
• Integration platform based on the cooperatives advantages of its
members, in order to compensate asymmetries and advance in
developments goals out of the neoliberal logics and based on
endogenous dynamics

16. PETROCARIBE
• Created in June, 2005.
• Energy Cooperation Agreement to coordinate and articulate energetic
policies, including oil and oil-products, gas, electricity and technological
cooperation.
• Membership (18, 12 Members of CARICOM): Antigua and Barbuda,
Bahamas, Belize, Cuba, Dominica, Grenada, Guatemala, Guyana, Haiti,
Honduras, Jamaica, Nicaragua, Dominican Republic, St. Kitts and Nevis, Saint
Vincent and the Grenadines, Saint Lucia, Suriname and Venezuela.
• ALBA-Caribe Fund
• Trinidad and Tobago and Barbados do not belong.

17. • Members (12): Argentina, Brasil, Uruguay, Paraguay, Venezuela, Bolivia,
Colombia, Ecuador, Perú, Chile, Surinam, Guyana
• CAN: Bolivia, Colombia, Ecuador and Perú
• MERCOSUR: Argentina, Brasil, Paraguay, Uruguay, Venezuela and Bolivia
• Goal: To encourage the regional integration in energy, education, health,
environment, infrastructure, security and democracy
• To promote the development of an integrated political, social, cultural,
economic, financial, environmental and infrastructure space, recognizing the
different ideological conceptions, corresponding to the plurality of its
Members
Union of South American Nations (UNASUR)

18. Community of Latin American and Caribbean States (CELAC)
• December, 2011: Foundational Summit in Caracas
• January, 2013: I CELAC Summit in Santiago de Chile
• January, 2014: II CELAC Summit in Havana
• January 2015: III CELAC Summit in San José
• January 2016: IV CELAC Summit in Quito
• January 2017: V CELAC Summit in Punta Cana
• 2018: El Salvador
• 2019: Bolivia
• 2020: Mexico

19. The Pacific Alliance
• The Pacific Alliance is trade bloc, formed by Chile, Colombia, Mexico and
Peru.
• The Pacific Alliance has more than 50 observer States.
• Based on free trade promotion.
• The objective is to conform an area of integration to ensure full
movement of goods, services, capital, and people.
• The project has embarked in other projects as issuing visa-free tourist
travel, a common stock exchange, and joint embassies.

20. 2018-2019: Deep crisis in LA regionalism
• Deep ideological and political disagreement
• PROSUR to replace UNASUR
https://www.youtube.com/watch?v=KLi8SOAThCY

21. Difficulties for regional integration in LA
Defined inclination towards integration but:
• Spaghetti bowl: Oversupply, Overlapping, Summit diplomacy…
• Insufficient financial institutions/mechanisms (no real possibilities for an
common currency)
• Insufficient infrastructure
• Lack of transportation alternatives
• Competition in instead of complementarity
• Not enough policies design to the less developed countries
• Not enough participation of the civil society
• Not enough participation of the SMEs

22. Integration’s benefits
•Possibilities to maximize national capabilities
•Proper diplomatic framework
•Unified regional voice
•South-South Cooperation
•Enhancing security

23. CAF - Development Bank of Latin America
• Corporación Andina de Fomento (CAF) – Banco de Desarrollo de América
Latina is a development bank created in 1970.
• Today, it is owned by 19 countries - 17 of Latin America and the Caribbean,
Spain and Portugal- as well as 13 private banks in the region.
https://www.youtube.com/watch?v=DRYcW0O5kE4