Economic integration organizations in Latin America and the Caribbean: text vs. contexts

Abstract

The following article focuses on the feasibility conditions for the survival of economic integration organizations in the region (CARICOM; CAN; MERCOSUR; SICA), under the renewed challenges of global economy. The author looks over a striking change in the World Trade Organization (WTO) criteria to qualify and evaluate the processes of economic integration. In particular, it highlights the WTO`s recognition of the so-called “depth” of Preferential Trade Agreements (PTA), which incorporate chapters on various economic and trade issues. Surprisingly, those “deep PTA´s” do not establish single markets or customs unions, but only free trade zones (in fact, “Free Trade Agreements”). By the way, the WTO report seems to recognize a very different world from that for which the GATT system was designed. In this frame, difficulties faced by those regional organizations not only prevent macroeconomic policies to engage but also to meet trade commitments. Such organizations show dissonances between its declared goals and the peculiar loopholes adopted by States as individual members. Carrying out the costs of integration into the global economy, national governments keep pressure on such economic integration organizations, in each case as a stage to try to transfer those costs to other member countries. The conflicts generated as a result of the pressures and tensions are gradually eroding the links established within those organizations. At the same time, national governments for its own sake multiply their commitments through Free Trade Agreements (FTA), thus managing ties both among other countries in the same region and with countries outside the region. In order to improve integration agreements in the region according with an appropriate response at the time, the author suggests a new model for dealing with the challenges of globalization. Therefore, employing similar framework in both sides (FTA) may lead to some forms of suitable and gradual convergence. The targets of the drive for such convergence may comprise not only rules of origin but a wide range of regulations.