The Politization of Mercosur

Posted in Latin America | 07-Aug-07 | Author: Christian Rieck

Christian Rieck is WSN Editor Latin America.

Is Mercosur a “free trade area”, a “customs union” or a “social project”? 15 years after its foundation Mercosur has entered a new phase of activity, but even after the relanzamiento of the year 2000 – which was supposed to restart Mercosur after the integration fatigue that had gripped the union in the late 1990s – there still exists a large quantity of exceptions in the rules governing the free trade area that serve to protect national production and impede the free flow of goods. The Common Market of the Southern Cone (Mercado Común del Cono Sur) can thus be described as an “imperfect customs union”.

Yet since its foundation, Mercosur has reached beyond a mere free trade area. Apart from the obvious macroeconomic aims (enlargement of national markets, support of the technical and scientific development of the member states) the aims of integration in the preamble of the founding treaty of Asunción included, even in 1991, the “adequate insertion of the member states into the international system of the great economic blocs” as well as the “creation of an ever closer union between their peoples”, analogous to the famed “ever closer union” of the European Union.

The treaty thus allows for an ever stronger social dimension of Mercosur that is to be realized by a variety of new instruments: the new parliament of Mercosur with its “human rights mandate” to observe the situation of human rights and to protect democracy in the member states, regional structural funds in the form of international infrastructure projects in order to integrate those countries more strongly in the field of critical infrastructure (energy, gas, telecommunications, transport) and regional cohesion funds in the form of the newly created convergence program in order to lessen the economic differences between the members, as well as the “Bank of the South”, a new regional development bank that has been created to support “the development of all countries of South America” better than (and without the conditionality of) comparable institutions. This new phase of inward-looking need not collide with the concept of “open regionalism”. Rather regional integration in Latin America can renew itself and have long-lasting effects only through successes in concrete fields of integration. The fiercest discussions concerning the direction and the aims of Mercosur therefore exist among its member states. The politization of the integration project is thus an answer to a series of conflicts within Mercosur.

Mercosur’s regeneration is also due to the new (relative) political homogeneity in the Southern Cone, a development that is embedded in the wider context of Latin America’s “drift to the left”: three of the four old members are governed by left-leaning presidents. Without doubt, Venezuela’s accession has further politicized the project and brought a systems competition to the union that oscillates between the two poles of “democracy” and “revolution”. The old members have subjected themselves to the democracy clause of the Treaty of Asunción and thus to liberal democracy and its institutions, while the new member Venezuela – even if it does not want to bring the “Bolivarian revolution” to Mercosur itself – aims at weakening the democratic consensus by committing the old members to its own path of social redistribution and at the same time codifying the principle of non-intervention in internal affairs. Bolivarianism’s claim to regional importance signifies an attempt to instrumentalize Mercosur while trying to make the economic union into a political project through a “Bolivarian agenda”. The human rights mandate of the new Mercosur parliament will definitely lead to future tensions in this regard.

Bolivarianism is an expression of the prevalent disenchantment since the Washington Consensus with the “neoliberal” policies of the 1990s. It is only Venezuela’s newfound missionary zeal emanating from President Chávez and his petrodiplomacy that makes it the engine of the regional social discourse. Venezuela has already threatened to reverse its accession to Mercosur if “the right wing” in the Brazilian Congress does not accept that Venezuela makes its own laws. This is evidence that Venezuela has no inclination to deal with criticism in a friendly and constructive manner – even in a tight-knit union of neighbours. Within Mercosur Chávez perceives a refusal to change. But he is not willing to accede to the “old” Mercosur. This points towards a new balance within Mercosur: besides the „small“ and the „large members“, with Venezuela there now exists a middle-sized power, one with competing leadership ambitions within the bloc. Brazil’s policy of embracing Venezuela through informal channels (face-time between the two „left-wing“ presidents) and formal institutions (the democracy clauses of the Treaty of Asunción as well as within the framework of the OAS) in exchange for economic privileges and the demonstrative closeness to the natural regional leading power is supposed to contribute to Venezuela’s moderation but proves to be a difficult balancing act indeed.

The politization of Mercosur away from the so-called „neoliberalism“ – perceived, in fact, as being North American – opens up important opportunities for the EU and their member states. The receding US-American influence should not be reason for European schadenfreude, however, but rather for a new Grand Design of European interests and ideas for shaping the region that is both active and strategic. Germany, too, could be more visible in South America and its presence could be stronger, building on long-lasting and robust relations. For this, however, Germany would have to frame the European integration more strongly as a project of peace, freedom and the rule of law that can offer some valuable lessons to Latin America while at the same time having specific differences that set it apart from the sometimes forceful supremacy of the United States.