Economic and political blocs, such as the Pacific Alliance, seem to be gaining importance in today’s politics, but how do they work?
The idea of a common passport for the members of the Pacific Alliance (PA), a sub-regional bloc that encompasses four of the biggest economies in Latin America -Chile, Colombia, Mexico, and Peru- represents a considerable step towards the dream of a regional integration. This tradition is not new, but it is a constantly contested possibility. Why do these economic blocs exist? What do they do? How will they change the future of Latin American economies?
There are two types of regional institutions in international politics: regional organizations and ad hoc blocs. The regional organizations are international institutions and, as such, they are characterized by four points: universal membership, a head office, bureaucracy, and permanent annual quotas. The biggest regional group in Latin America is the Organization of American States (OAS).
On the other hand, the ad hoc blocs are created for specific purposes, with or without the requirements of regional organizations. They are characterized by their flexibility and their adaptability to various circumstances. For that reason, they lack bureaucracy and permanent head offices. Their members coordinate their actions through summits or reunions.
There are several ad hoc blocs in Latin America, for example: the Bolivarian Alliance for the Peoples of Our America (ALBA) and the Southern Common Market (Mercosur). In both cases, states are usually not accountable for their actions when failing to comply with their agreements but the decisions of the organizations have a visible bond making the states comply, in the majority of cases.
Ad hoc organizations are frequently presented as economic blocks, which means that their objectives are purely concerned with financial matters. This perspective makes them easy to be accepted by national governments as monetary subjects separated from political matters. Nonetheless, the flexibility of these organizations allows the executive branch of a state to make informal pacts in other areas with similar branches of other countries.
The future of ad hoc blocs is not clear, as two of the main alliances are going through a difficult time: the decrease in leadership of Venezuela’s and Ecuador’s governments puts ALBA’s countries in competition and the slow economic growth of Brazil places Mercosur in a dilemma between protectionism and liberalism.
Therefore, Latin American organizations are experiencing a change from “post liberal regionalism” (characterized by statism politics, the pursuit of autonomy of markets and an increasing interest on social dimensions) to more diverse schemes that include sub-regional blocs that look for consensus without a specific political philosophy.
What is the best option for Latin American countries? As of right now, there is no easy answer but there might be a way out with different organizations for different purposes. This includes regional organizations such as the Economic Commission for Latin America and the Caribbean (CELAC) to deal with the increasing importance of China in the region, and sub-regional ad hoc blocs to coordinate political and economic activities, such as shared embassies.
Latin American Post| Julio César Díaz Calderón
Copy edited by Susana Cicchetto