As Europe struggles, Mercosur’s supporters need a new lodestar

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Last Friday I visited the Mercosur Secretariat in Montevideo, Uruguay's capital, where I met with several of its permanent staff to speak about the future of regional integration. The Secretariat is housed in a former luxury hotel, majestically looking over the bay of Montevideo's Playa Ramirez, with a large white Mercosur flag fluttering in the wind along with those of the organization's four member states: Brazil, Argentina, Paraguay and Uruguay. Yet the grand setting cannot belie that Mercosur and the project of regional integration have lost much of its dynamism.

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Back in 2004 and 2005, when I spent several months in Montevideo to conduct research under Oscar Stark, a Paraguayan economist and advisor at the Secretariat, optimism was in the air. A trade agreement between Mercosur and the EU seemed possible. Deisy Ventura, one of Stark's colleagues, had just published "The Asymmetries between Mercosur and the European Union", a book that caused many young scholars to study regional integration in South America. Articles (from both South American and European scholars) comparing the EU and Mercosur proliferated. Economists wondered about the impact of a common Mercosur currency. Several universities even began to offer degree programs in 'regional integration'. The underlying rationale was simple: Even though Mercosur would never quite reach the level of integration in Europe, the EU served as the ultimate model and reference for all those in favor of regional integration. Brazil's President Lula himself made regular reference to the EU whenever he spoke of Mercosur's future.

For a variety of reasons, regional integration in South America has progressed at slow speed, and the proliferation of regional bodies has not helped, as I wrote in an article in February 2010 ("The hollow rhetoric of Latin American unity"). Yet, even more importantly, as the EU is struggling to survive and paying for past mistakes, the way policy makers in South America think about regional integration in general is undergoing a fundamental transformation. Even though it had little relevance for immediate policy making, it was not uncommon until recently to hear Brazilian diplomats elaborate on a more united South America à la EU. Now, as Europe's trajectory looks increasingly uncertain, even vague comparisons to the EU have vanished.
 

This matters because even long-term projects need a lodestar that allows policy makers to articulate a vision - say, a world free of nuclear weapons or a clean planet for the next generation. With the EU in tatters, those who want Mercosur to remain a merely intergovernamental organization (rather than supranational) have a powerful argument on their side. Those promoting regional integration both in South America (and around the world) will need to think hard about how to convince their governments to take the difficult decisions -such as giving up some sovereignty - that are necessary on the way to becoming a more united continent.

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Photo credit: Portal del Mercosur