We’re constantly being told that Latin America is a deeply divided region that has failed to live up to its potential.
On the one hand, there’s Hugo Chávez and his pals in Ecuador, Bolivia, Nicaragua, Cuba and even Argentina, and on the other the more “enlightened” (some may say pro-Washington) leaders in Mexico, Colombia and to a certain extent Chile, Brazil and Peru, among them some erstwhile leftists.
Venezuela, we’re told, is squandering its petrodollars on influence peddling, while much of South America’s natural resources such as oil, copper and iron ore are being used to fuel Asian growth, with little or no value being added to the region’s exports. China and India are leading the way on the global economic scene: China is threatening the more manufacturing-based economies of Mexico and parts of Central America with cheap exports, while India is stifling growth in the region’s services sector.
Latin America hasn’t even been able to produce a free trade bloc worth its salt, the result being a serious lack of competitiveness in the region, or so the argument goes.
Corruption, crime and poor governance are rampant, we read in the media, while the White House, despite all the promises, has largely ignored the region since 9/11. In the meantime, Latin America is plagued by what - at least to outsiders - appear to be petty squabbles, such as Chile, Bolivia and Peru arguing about access to the ocean and maritime borders, a debate dating back to the 19th century.
As in all such claims and generalizations, there are some truths, some half-truths and some plain errors.
But looking back 10, 20 or 30 years allows us to put things in context.
It’s not so long ago that none-toofriendly military regimes ruled large parts of South America - Brazil, Argentina, Chile and Uruguay - while Paraguay had a peculiar dictatorship of it own, and Bolivia’s “palace coups” were all too frequent. Mexico, meanwhile, was virtually a one-party state until this century.
In the 1980s, civil wars were raging in Central America, Cuba was seen as a military threat to much of the region, and Peru was rocked by terrorist violence. Just for good measure, there was Manuel Noriega’s drug trafficking and money laundering, and the subsequent US invasion of Panama, and then in the 1990s came the Zapatista “uprising” in Chiapas.
On the economic front, we had hyperinflation on a Zimbabwean scale,the infamous debt crisis (who’s afraid of the IMF these days?), and banking meltdown after meltdown, from Chile in the 1980s to Argentina most recently, and in the middle… the Tequila crisis, no less.
Today, with one obvious exception, democracy in some form or another prevails universally throughout the region. Brazil has emerged as a regional powerhouse, with many of its corporations laying claim to the status of multinational, Mexico has taken the path to reform, and Argentina has stabilized.
Even the situation in Colombia, torn apart by violent conflict for so many decades, has improved to such a degree that many now see the country as a model of stability “a la chilena.”
And the region has been enjoying strong economic growth in recent years - 5.6% in 2006 and a forecast of 5% for 2007, according to the UN Economic Commission for Latin America and the Caribbean, compared to an average of just 1.1% in the 1980s (when per capita income fell in many countries of the region).
All that’s not to say problems don’t exist. Corruption, crime, narcotics, poverty, inequality and in some cases, political instability and the lack of rule of law, are all serious issues that need to be addressed. But the question remains, why is it that Latin America appears to have been left behind, while large parts of Asia, Eastern Europe and other regions of the world have progressed so impressively in recent years?
Education, technology and above all integration are the buzzwords of today. Vast natural resources are fine, but they’re not enough unless they’re used sensibly and come with the added value that technology can provide, and integration is key to boosting trade and taking advantage of infrastructure synergies between nations, or so we’re told.
By definition, political integration requires the ceding of some sovereignty. And that’s precisely where Latin American nations have stalled.When it comes to integration, Latin America has many advantages in terms of being relatively homogenous culturally and linguistically, with a fairly common recent history, at least for the last 500 years, and - compared to some parts of the world - a long period of peaceful cohabitation between nations (as opposed to civil strife). When was the last major war between Latin American nations? Compare that to Europe, which fought two devastating world wars last century but where the major nations, and most of the smaller ones, have lived in peace for over 60 years, managing to reduce poverty and enjoy political and economic stability. And all that despite very different histories, cultures and languages. In the decades after World War Two, the richer nations saw the need to bring the poorer ones into the fold, to the benefit of all as markets expanded, infrastructure improved and living standards rose.
So if integration is the answer for Latin America too, the question must be, why isn’t it happening?
For it to work, integration needs to be economic, including free trade for both goods and services, with open labor and capital markets; physical in terms of transport infrastructure, energy and so on; and political. In other words, it has to be integrated integration.
Free trade may be a good place to start, as was the case in Europe. After all, with a couple of obvious exceptions, Latin American markets are often just too small to attract the big players. Even Mexico and Brazil are small compared to China, the EU or the US.
But it’s not just about a free trade zone and hence a bigger market, although that’s important. It’s about creating the right political conditions to attract the long-term investment - both domestic and foreign - needed for development, and that requires a supranational legal framework, and political bodies that transcend national boundaries.
By definition, political integration requires the ceding of some sovereignty in order for supranational bodies to function. And that’s precisely where Latin American nations, or at least their political leaders, have stalled. Strong nationalist feelings across the region have hindered the process of integration as no one wants to budge on the issue of sovereignty. Integration must not be seen as posing a threat to a nation’s sovereignty. In fact, the decision to integrate is itself a sovereign one to be made by each nation.
The irony is that the “Boliviarian revolution” is stirring up nationalist feelings, fomenting polarization and hindering the process of integration, the very same process that Chávez claims to be promoting. Real integration requires assuaging the jingoism and xenophobia. It’s a long-term process, but one that should have started many years ago.
