Latin American Research Review 40.3 (2005) 354-364
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Latin America and International Trade:
Regionalism and beyond
When at the beginning of the 1990s Latin America left debt crisis and dictatorships behind it, a new chapter started for many Latin Americanists as well. The transformation towards, or restoration of, democracy in various societies of the Western Hemisphere became the next phase in the careers of many scholars. At the same time a new type of expert entered the field of Latin American Studies: the trade specialist. The 1990s became the decade of the so-called "Washington Consensus" and of "Open Regionalism," setting off a whole process of financial [End Page 354] and economic transformation within and between Latin American countries. The new type of Latin American analyst focused on emerging, or re-emerging, trends in different parts of Latin America of trade liberalization and regional economic integration. Often presented as part of the same package of reforms identified as the Washington Consensus, trade liberalization and regional integration were actually stimulated in Latin America by both endogenous and exogenous factors.
Within Latin America previous decades had seen a variety of pan-American or subregional initiatives aimed at creating free trade areas or common markets within sections of the hemisphere. Some succeeded, such as in the Caribbean; others, after eventful starts in the 1960's, like the Andean Pact or in Central America, faltered under the burden of the unruly economic and political decades that followed. However, until the ideologically-driven ISI (import substitution industrialization) outlook of many of the participating countries was abolished, no real opportunity existed for opening borders or widening regional trade relations. The end of international tensions created by the Cold War, the rise of new ideas in developed economies based on market deregulation and trade liberalization, as well as a new interest in so-called export-driven "emerging" economies or NICs (Newly Industrializing Countries), all allowed for renewed strategies in Latin America under the justification of the Washington Consensus, but all aimed at regional economic integration and trade liberalization. This was achieved either through bilateral approaches, as pursued by countries like Mexico and Chile, or through subregional initiatives, such as the Mercosur process or the revived Andean Community. Thus, the beginning of the 1990s saw a revival of regional integration strategies in Latin America, driven mostly by Latin American countries themselves.
Outside of Latin America a number of important factors contributed to the opening up of Latin American markets, either by involving them in a wider type of extra-regional trade integration process, or by trying to strengthen their own indigenous processes of integration through political and technical assistance, and through development aid, often based in the contributing countries on a mix of idealism, political calculation and plain commercial interest. The main protagonists for these exogenous factors were the United States and the European Union (EU), with President George H.W. Bush's Enterprise of the Americas initiative and President Clinton's Free Trade Area of the Americas proposals being the most pronounced attempts in recent years to access Latin American markets and integrate them with the U.S. economy. On the other hand, the European Union, partially driven in its policies towards...