Why is the creation of a union of South American nations so important?

28 Jun 2010 by Fausto Sicha, No Comments »

By: Fausto Sicha

M.A. in International Relations

The City University of New York

Sept. 2009

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Over the last two hundred years, several attempts to form a union in the Americas have been promoted in different times, by different leaders, and for different reasons, but so far all of these attempts have failed due to the absence of a decisive leadership and a lack of political will. Despite the failure of previous attempts to unite the region, South American leaders have not given up yet and now once again they are trying to unite South America.

The chapter is organized as follows: first, I will briefly describe why the most important attempt to form a union promoted by Simon Bolivar failed, while also exploring the different theoretical approaches that attempt to explain regional integration. Second, I state my thesis argument and argue that the consolidation of the Union of South American Nations (UNASUR) has the potential to improve the economy and security of South America. To support my argument, I discuss the factors that could contribute to the consolidation of UNASUR, the potential benefits of regional integration, and the possible negative effects if leaders in the region fail to strengthen UNASUR.

First Attempt to Integrate the Region
The dream of a united Spanish America has been present at least since the Congress of Cucuta in 1821. From 1821 to 1826, Simon Bolivar attempted to consolidate political control in the former Viceroyalty of New Granada, now known as Colombia, which included the present-day nations of Colombia, Panama, Ecuador, and Venezuela. Not long after the Congress of Cucuta, people from the region that is currently called Venezuela started to show signs of frustration at being governed from distant Bogota, Colombia. People in what is today Ecuador, also showed dissatisfaction over the lack of economic assistance from the central government. Furthermore, this frustration increased because only a few natives from the Ecuadorian region held positions of importance in the central government.

Despite all of the challenges and frustrations in La Gran Colombia, in 1826, Bolivar made the first effort to bring together the states of the Americas to form a union. To promote this union he convened the First International Congress in the Colombian Province of Panama having Colombia, Mexico, Peru, and the United Provinces of Central America in attendance.

Unfortunately, during the first months of 1826, economic and political problems in the region worsened. These problems, combined with the efforts of a separatist movement that emerged in Venezuela, impeded the consolidation of political and military control of the region. In November of 1829, Venezuela declared its independence from the Gran Colombia, shortly followed by Ecuador, which declared independence on May 13, 1830. The dream of a united Spanish America was falling apart and with the death of Bolivar on December 17, 1830, this dream vanished completely.

Though Bolivar’s dream to create a united Spanish America did not come to light during his lifetime, we are now seeing new hope for a united South America. This new hope began in 2000 during the first South American Summit in Brasilia, Brazil, when the Brazilian President Fernando Henrique Cardoso proposed to his counterparts the creation of a union. Cardoso’s proposal was immediately accepted by all regional leaders and most enthusiastically by Venezuelan President, Hugo Chavez. Following Bolivar’s vision, this new attempt to unite South America is based not only on political, economic and security interests, but also on cooperation and solidarity, ideals that have emerged once again in the regional discourse.

Before discussing the possibility of realizing a union in South America, it is necessary to look at theories that can help us get a more comprehensive picture about the process of regional integration. A theoretical approach to regional integration agreements (RIA) is a good starting point.

Theories That Attempt to Explain Regional Integration
According to Richard E. Baldwin and Anthony J. Venables, there are three types of regional integration agreements:

A free trade area (FTA) is a RIA formed by removing tariffs on trade among nations that are FTA members without changing tariffs on imports from non-members.

A customs union (CU) is a FTA where members’ tariff structures on the extra-CU trade are equalized.

A common market (CM) permits free movement of factors of production such as labor, capital and goods.

It is the last of these RIA that South American leaders aim to achieve as they are seeking a political and economic union.

Political and economic theories attempt to explain regional integration agreements. Yet, in explaining integration, neither the political nor the economic theories have been developed completely.

Political Theories
Political theories such as federalism and neo-functionalism can be used to attempt to explain a RIA. However, in the case of South America, these theories are not applicable for several reasons. First, according to Margaret P. Karns and Karen A. Mingst, before political integration can take place, economic and trade integration must be implemented. Therefore, since economic and trade integration in South America is still in the early stages, this cannot yet be explained using the political theories.

Second, federalism “has never proved to be a successful route to political integration, and its successes have been achieved only under unusual political circumstances.” In the case of Switzerland and the United States, for example, an external security threat was a big factor in the creation of these federal republics. Today, it is not a security threat but economic concerns that are pushing the South American economies towards integration. Furthermore, South America does not necessarily need a federation to achieve economic benefits. In the European Union, for instance, economic benefits and the expansion of the regional integration have been achieved without a formal federation.

Third, neo-functionalism argues that “economic, technological, and other developments… have driven people and nation-states toward peaceful economic and political integration.” Moreover, according to those who defend this theory, economic cooperation among countries helps to eliminate illiteracy, poverty, hunger, and diseases which are the main causes of war. This theory is not used to explain integration in South America because it has two main flaws: (1) the theory’s ultimate goal is to eliminate war; however, it fails to explain how war can be eliminated when it is caused by issues other than economic deprivation, illiteracy, hunger, and diseases, and (2) this theory also assumes that political and nonpolitical issues can be easily distinguished, but fails to explain how one can distinguish the two issues.

The New Growth Theory
Economic theories that attempt to explain regional integration such as the New Growth Theory (NGT), “have not significantly advanced [the] understanding of the actual process of economic integration….In fact, the subject of economic integration remains largely empirical rather than theoretical.” Even though the economic theories are still “underdeveloped,” the New Growth Theory first set forth by Paul Romer in 1986 and Robert Lucas in 1988 seem suitable to explain integration in South America for several reasons. a) In the last few years the NGT has “strongly influenced economists’ thinking about regional integration.” b) The NGT allows the intervention of the government in the economy. c) The NGT encourages investment in research and development (R&D). d) This theory emphasizes the need to invest in education and technology. e) The NGT allows the regulation of multinational corporations.

To understand the importance of the NGT in explaining the integration and development process in South America, it is important to first comprehend the explanation of long-term growth from the Neo-classical Theory of Economic Growth. Robert Solow, one of the Neo-classical Growth theorists during the 1950s “argued that economic growth is a product of capital accumulation, labor input, and technical progress.” Solow’s argument is based on the neo-classical production function which assumes that economic growth is the result of the rate of increase in labor input, capital input, and technical progress and that the accumulation of the factors of production together with technical change contributes to the long-term growth of an economy.

According to the Neo-classical Theory of Economic Growth, government policies do not have a significant effect on long-term rate of economic growth. This theory also assumes that due to the transfer of technology from the developed countries to the developing ones, the economies of the latter should eventually converge with the economies of the former. The Neo-classical Theory also considers technological progress to be exogenous to economic growth. Finally, the Neo-classical Theory neglects the importance of human capital and knowledge skills.

As it is clear, the NGT and the Neo-classical Theory of Economic Growth differ significantly from each other. In the NGT, technological advance is considered endogenous because technological innovations are the result of conscious investment decisions taken by entrepreneurs and individual firms…. [Unlike in the Neo-classical Theory, in the NGT] knowledge, technology, and/or ‘know-how’ constitute a separate factor of production in addition to capital and labor.

Aware that technological innovation is a separate factor of production, governments and private firms in South America, especially those in Brazil and Argentina, have been actively acquiring technology to reduce costs and increase production.

The Neo-classical Theory argues that the “invisible hand” of the market will regulate the economy of a country and that governments should not play a role in their economies. On the other hand, the NGT allows governments to play an active role in their economies to increase long-term economic growth. This is visible in South America. With the failure of neoliberal policies and the adamant protests against them, beginning in the late 1990s the governments in the region began to strengthen the state’s influence over the economy. Many have nationalized mineral deposits, oil and natural gas fields and by doing so have ensured for the state a central role in their country’s economies.

The NGT sees international firms as price setters rather than price takers. Additionally, unlike the Neo-classical Theory, the NGT sees the market as imperfect and oligopolistic rather than as a perfect one. Aware of the imperfections in the market, governments in South America under the leadership of Brazil opposed the Free Trade Area for The Americas (FTAA) promoted by the U.S. to protect their weak national firms that would have been unable to fairly compete with firms from the United States and Canada.

Finally, in the Neo-classical Theory, R&D is left to private firms and social expenditures such as education are constantly being reduced. On the contrary, according to the NGT “economic growth can be increased by appropriate industrial and government policies that increase expenditures on knowledge creation, R&D, and such human capital formation as education and training.” Consistent with the NGT’s recommendations, an increase in the expenditure in education and training has also been seen in South America. For example, since 2000, governments in Bolivia, Ecuador and Venezuela have been promoting free universal education for their citizens.

The NGT is a good theoretical fit for explaining the South American integration because it advocates strategies that are already becoming implemented in some countries and which, if implemented fully throughout the region, would lead to better long-term growth of the regional economies.

The Latest Attempt to Unite South America
The intervention of governments in their economy as provided by the NGT is a tool that can facilitate regional integration and economic growth. However, the theory by itself cannot guarantee the formation of a political and economic union. Among other things, to form a union it is necessary to have a regional leader, political negotiations, and the creation of supranational bodies that can dictate mandatory policies to members of a regional bloc. Therefore, in light of the latest attempt to integrate the South American region, an important question remains to be answered. Can South American leaders finally leave behind their economic and political differences and work together toward the consolidation of a regional union that stands together before the world and represents the interests of each country in the region?

“I profoundly doubt about the consolidation of a South American Union in the next few years” says Juan Gabriel Tokatlian. Tokatlian, a respected scholar in the region, argues that a union is not possible because South America is divided into two significantly different regions: (1) the relatively prosperous Southern Cone, and (2) the unstable Andean Community, where political instability, a lack of economic progress, and social divisions are evident. According to Tokatlian, this would make impossible the consolidation of a union in South America.

Not everyone agrees with Tokatlian. Other leading scholars such as Torcuato S. di Tella for example, argue that the consolidation of a union in South America is possible. Di Tella recognizes that the South American region has problems such as political instability, low levels of education, inequality, and corruption. He argues, however, that these problems do not hinder the consolidation of a union in South America. He says that the need to internally stabilize countries in the region combined with the economic advantages of a regional market make regional integration both desirable and possible.
Without doubt, political, economic and social problems are challenges that will make regional integration difficult. However, just like Di Tella, I think that regional integration will help to overcome these problems. Therefore, in this thesis I will argue that the consolidation of the Union of South American Nations (UNASUR) will contribute to the improvement of the economy and security of South America.

Factors That Could Contribute to the Consolidation of UNASUR
The consolidation of UNASUR is possible for several reasons. First, the economic and security interests of a country in this globalized world can best be achieved by forming blocs, because as Daniel Garcia Delgado says, “there is no future without a region, and the future is a future of blocs.” Current challenges such as terrorism, global warming, economic competition, attraction of foreign direct investment (FDI), and better access to international markets are all issues that require regional cooperation. Therefore, in order to have competitive advantage in the global arena, countries need to unite in order to successfully compete against other powerful countries and regional blocs.

Second, the emergence of a new leadership in South America is facilitating regional integration. Beginning with the Presidency of Fernando Henrique Cardoso in Brazil in 1995, and the election of Hugo Chavez in Venezuela in 1999, new leaders in Ecuador, Bolivia, Chile, Uruguay, and Argentina have been openly promoting the idea of a union in the region. Besides their common desire to form a union, all these leaders have also a leftist political view and arguably reaching agreements among them can be easier today than in the past.

Third, Brazil and Venezuela, the most powerful countries in South America, are leading the consolidation of UNASUR by promoting infrastructure that will allow them better access to the region’s natural resources and an expansion of their local market to the regional and international level. Additionally, Brazil’s desires to stabilize the region and to prevent the spread of Colombia’s guerrilla problems could also help consolidate UNASUR.

Fourth, the backlash against neoliberal policies, promoted by Washington in the region for more than twenty years, has diminished U.S. economic influence in South America and has led to an effective opposition against the U.S. hegemony. For example, South America under the leadership of Brazil has opposed a U.S. sponsored Free Trade Area for the Americas at the hemispheric level. The prevalence of this anti-neoliberal sentiment and globalization has pushed governments in the region to seek better access to the Asian and African markets.

Finally, South American countries now more than ever need to face together challenges such as poverty, instability, and drug trafficking. Therefore, a regional integration is a practical response to regional issues. Finally, in a stark change from the past, the idea of a union today is well supported by the majority of the population and part of the business community in the region.

Forming a union in South America will not be easy. However, the regional leadership of Brazil and Venezuela, the benefits of expanding the market at the regional and international level, and the willingness of governments to work together in the region will facilitate the consolidation of UNASUR.

Failure to Form a Union Could Have Negative Effects in the Region
If South American leaders fail to work together to form a political and economic union, the consequences may be detrimental to the region.

First, Colombia’s guerrilla problems may further expand to neighboring countries and drug trafficking and insecurity in the region may increase. Hence, a regional effort to offer a political and economic solution to Colombia’s internal problems is needed.

Second, democracy in the region can also deteriorate if drug producers and traffickers in Bolivia, Peru, and Colombia secretly begin to sponsor political candidates who will not address guerrilla-war and drug problems. By threatening and/or bribing elected officials and judges, drug traffickers can surely undermine democracy. As a consequence, street protests and national strikes used to express social dissatisfaction with political institutions will do nothing but deteriorate the economic situations of the region.

Finally, not forming a union in this globalized world may stop South American countries from improving access to international markets. As a result, the regional economies will continue to lag behind and the welfare of South Americans may further deteriorate.

Potential Benefits of Integration
If South American leaders work together, the consolidation of UNASUR could offer the same benefits that the European Union (EU) offers to its member-states. First, in South America, the promotion of infrastructure will increase the amount of regional and international trade, and as a consequence, UNASUR will help improve the economy of the region. Furthermore, UNASUR could also improve the regional economy because it will help “to stabilize the prices of raw materials for exportation, and to get access [for these products] to industrialized markets in favorable conditions.”

Big countries are not the only ones that will benefit from infrastructure that can increase regional and international trade. Regional integration is also economically advantageous for weaker and smaller countries. There is a precedent for this, in the European integration (which is not analogous to the UNASUR integration for reasons that I will explain in Chapter Two) “countries like Greece, Portugal and, regions like Southern Spain and Southern Italy have experienced better living standards due to their European Union membership.”

In UNASUR, small and economically weak countries such as Peru, Ecuador, and Colombia will serve as exporting points of regional products and natural resources. As a result, these countries will not only benefit from the infrastructure, but they will also be able to increase their exports. Bigger trade exports in small countries can perhaps reduce tensions with big countries due to the asymmetry in economic gains.

Second, by having a bigger market and by increasing commerce among the member-states, a single currency could be created. The economy of UNASUR would be improved because a single regional currency “serves to contain exchange rate fluctuations [and] has positive implications for trade.” Additionally, a single currency increases the inward flow of foreign direct investment and allows the free movement of factors of production such as labor, capital and good. All these benefits that a single currency offers could help improve the economy of UNASUR.

Third, UNASUR could help solve domestic and regional instability and security problems. The internal social and political instability of Bolivia and the Colombian guerrilla conflicts that have begun to spread to the region require a regional political and economic solution. By forming a united front, by having regional peacekeeping troops and by forming a regional “Contadora Group,” UNASUR could help bring stability and security to the region. “The institutionalization of the Union will also help to politically stabilize the member-states, especially those with weak economic development and weak political institutions.”

Finally, the economic and security benefits of UNASUR can be enjoyed by all South Americans. According to Di Tella, in South America the common language and religion will make migration much easier than in the EU. Hence, a common immigration policy will allow the free movement of people among the member-states and would increase work, education and travel opportunities for all.

Methodology
In this thesis, besides using the NGT to explain integration, I will also adopt a qualitative approach and use mainly primary and secondary sources to support the study of the consolidation of UNASUR. The international and multi-lingual sources used in this research such as, books, journals, academic articles, and official government documents will allow me to analyze the topic of integration from different perspectives and gain a better understanding of the possibilities and challenges of the consolidation of the Union of South American Nations.

Thesis Outline
This thesis is organized as follows: Chapter 2 will describe a brief history of the European integration and the past integration attempts in Latin America. I will discuss how integration has helped the EU to improve its economic and security status in the region and argue that the EU is an example that can only partially be followed in the integration process in UNASUR. Chapter 3 will be divided into two sections: (1) the promotion of infrastructure to increase trade under the leadership of Brazil, and (2) the promotion of energy integration on the part of Venezuela. It is my intention to show that both trade and the energy integration will improve the economy of UNASUR. In Chapter 4, I argue that UNASUR can improve its economy by having a single monetary policy and a single regional currency. In Chapter 5, I will talk about how UNASUR can improve the internal and external security of the South American nations. I will follow this with my conclusion.

Harold Molineu, US Foreign Policy Towards Latin America (Colorado: Westwiew Press, 1986), 17-20. Bolivar promoted the idea of a United Spanish America in 1826, during the first International Congress in Panama City. In 1830, Mexico responded to the Monroe Doctrine of 1823 promoted by the United State, by focusing in organizing the Latin Americans to contain U.S. imperialism. In 1860, Argentina’s Foreign Minister Domingo Faustino Sarmiento supported the idea of a political-military alliance in the Americas to deter external threats. His support for this alliance was due to the Latin American concern “about French involvement in Mexico, and Spanish intrusion into the Dominican Republic.” In 1889, the Pan American Union (PAU) was promoted by the United States. This attempt was made with U.S. commercial expansion in mind. “Aside from serving as a vehicle for the promotion of the U.S. commerce, the PAU’s contribution to “union” was not discernable.” 20.
As it is evident, throughout the past 200 years, some of the attempts to unite the region lack decisive leadership, and some attempts were promoted with the U.S. economic interest in mind.

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Enciclopedia Británica, “Gran Colombia.” http://www.britannica.com/EBchecked/topic/241012/Gran-Colombia (accessed March 16, 2009).
Ibid.
Molineu, 21. Bolivar’s original concept of unity and cooperation was for Spanish America only and it included the idea of ties to Great Britain, not the United States. Bolivar wanted all countries in Latin America to be part of a “United Spanish America,” today, the idea of a union is being promoted only in South America; however, UNASUR Constitutive Treaty says that any Latin American Country can be part of this regional integration effort.
“La Gran Colombia.” http://www.simon-bolivar.org/bolivar/gran_colombia.html (accessed March 16, 2009).
WHKML, “History of Gran Colombia, 1819-1830.” http://www.zum.de/whkmla/region/samerica/grcolombia.html (accessed March 16, 2009).
Chirstoph Zopel, “La integración sudamericana como requisito para la independencia.” Nueva Sociedad, No. 216 (July/August, 2008): 30.
Richard E. Baldwin and Anthony J. Venables, “Regional Economic Integration.” (August, 2004): 1. Baldwin_Venables_Handbook.pdf (accessed May 4, 2009).
Robert Gilpin, Global Political Economy (New Jersey: Princeton University Press, 2001), 345.
Margaret P. Karns and Karen A. Mingst, International Organizations: The Politics and Process of Global Governance (Colorado: Lynne Reinner Publishers, Inc, 2004), 40.
Gilpin. 349.
Ibid. In the case of the U.S., the 13 Colonies had to unite in order to be able to fight and win independence from the United Kingdom.
Haines. 109.
Gilpin. 350.
Karns, et al., 40.
Ibid. 41. Despite these limitations, functionalism and neo-functionalism has been important in explaining the evolution of the European Union and cooperation among International Governmental Organizations.
Gilpin. 345.
Ibid. 348.
Ibid. 114.
Ibid. 108.
Ibid.
In this paper, Neo-classical Theory of Economic Growth will be used interchangeably with Neo-classical Theory.
Gilpin. 111.
Note, the New Growth Theory (NGT) is completely different to the Neo-classical Theory of Economic Growth.
Gilpin. 113.
W.E. Jepson, “Globalization and Brazilian biosafety: the politics of scale over biotechnology governance.” Political Geography, No. 21, (2002): 907. ScienceDirect.com (accessed May 7, 2009).
Caroline Jova, “Nationalization in Bolivia: Curse or Blessing?” Latin America and Caribbean Center. Florida International University, (August, 2006). http://lacc.fiu.edu/research_publications/working_papers/WPS_012.pdf (accessed May 11, 2009). 
Gilpin. 114.
Peter Hakim, “The Uneasy Americas.” Foreign Affairs, (March/April, 2001). http://www.foreignaffairs.com/articles/56846/peter-hakim/the-uneasy-americas (accessed May 17, 2009).
Gilpin. 116.
Thomas Muhr and Antoni Verger, “Venezuela: Higher Education for All.” Journal for Critical Education Policy Studies, Vol. 4, No. 1, (March, 2006). http://www.jceps.com/print.php?articleID=63 (accessed May 17, 2009).
The theory can be said that is partly implemented because today education is free in countries like Ecuador and Venezuela. In Brazil, the government has been promoting R & D. In Bolivia, the government has been playing an active role in the Economy.
Juan Gabriel Tokatlian, “La descocertacion sudamericana.” Nueva Sociedad, No. 176. 125. Juan Gabriel Tokatlian is the director of Political Science and International Relations in la Universidad San Andrés, in Buenos Aires, Argentina.
Juan Gabriel Tokatlian, “La Unión Sudamericana? Inexorable o contingente? Desarrollo Económico, Vol. 41, No. 161, (2001): 141.
Torcuato S di Tella, “Que se gana con una Unión Sudamericana?” Desarrollo Economico, Vol. 40, No. 159, (2000): 519 – 520. In this paper, regional integration and union will be used interchangeably. When I talk about one of the aforementioned terms, I will be referring to both political and economic integration. Regional integration or union here is understood as the transfer of some powers -previously vested in individual sovereign states- to a supranational body. Supranational body is defined here as an institution that has authority over the states.
Daniel García Delgado, “La energía como clave del proceso de integración regional.” (2008): 1. Flacso.org (accessed May 4, 2009). The author is director of State and Public Policy in Argentina).
This is no to imply that there are not disagreements among the leaders in the region. I will address the most important disagreements throughout this paper.
Diego Cardona C., “Tiene Futuro la Comunidad Sudamericana de Naciones?” Foreign Affairs en Español, (April/June, 2005): 1. Brazil for example has 50% of the land, population and GDP of UNASUR.
Marco Aurelio Guedes de Oliveira, “Origen and Evolution of South American Community of Nations: From Trade to Security Concern.” European Union Miami Analysis (EUMA), Vol. 4 No. 5 (March, 2007): 5 – 6.
Stiglitz, Joseph E., Globalization and its Discontents (New York: W. W. Norton, 2002), 67.
Paul Kellogg, “Regional Integration in Latin America: Dawn of an Alternative to Neo-liberalism.” New Political Science, Vol. 29, No. 2, (June, 2007): 188.
Przemyslaw Kowalski and Ben Shepherd, “South-South Trade in Goods.” (2006) OECD Trade Policy Working Papers, No. 40. http://fiordiliji.sourceoecd.org/vl=23603379/cl=14/nw=1/rpsv/cw/www/cgi-bin/wppdf?file=5l4tqkdzt1f6.pdf (accessed May 23, 2009).
Katz. 7, 15, 16.
Jose Briceno Ruiz, “The new regionalism in South America. From SAFTA and the South American Community of Nations.”(Document presented at the 48th Conference of the International Studies Association, Chicago, 2007): 4. http://fhs.uhk.cz/politologie/texty/sprinpa1/informace/new-regionalism-in-south-america-comm-of-nations.pdf (accessed May 4, 2009).
Matthew Fuller, “From Civil Unrest to Social Cohesion: The Problem of El Alto City in Bolivian Human Security.” HumanSecurity-Cities.org (accessed May 23, 2009).
Alma Chapoy Bonifaz, “Cooperación Financiera Regional en Latín América: Posibilidades y Obstáculos.” 104. http://bibliotecavirtual.clacso.org.ar/ar/libros/edicion/correa/bonifaz.pdf (accessed May, 6, 2009). (The author is an expert on financial issues. She is a researcher for the Economic Investigations Institute at the Universidad Nacional Autonoma de Mexico (UNAM). The author has also written six books and published several articles about financial issues).
Diego Cardona C., “Tiene futuro la comunidad sudamericana de naciones?” Foreign Affairs en Español, (April/June, 2005): 5. The European experience demonstrates that even though small countries – just like big ones – can gain economic and security benefits; they will sometimes be unwilling to shoulder the initial burden of integration due mainly to the asymmetry in economic gains.
In a regional bloc, the country that trades the most is the country that gains the most. In South America, Brazil due to its size and strong economy will gain more than any other country in the region.
Jorn Griesse and Christian Kellermann, “What comes after the dollar?” International Policy Analysis, (April, 2008): 7.
Ibid.
Pavlos Petrolaus, “The Effect of the Euro on Foreign Direct Investment.” European Economic Review, No. 51, (2007): 19. ScienceDirect.com (accessed June 7, 2009).
The Contadora Group was formed among Venezuela, Mexico, Panama and Colombia. The aim of Contadora was to bring peace and stability to the conflict between the Sandinistas and the “contras” in Nicaragua. This conflict began to spread to other Central American countries during the 1980s.
Di Tella. (2000): 535. MERCOSUR has already been helping in that manner in the Paraguayan crises.
Ibid. Portuguese is the official language of Brazil, however, a good percentage of Brazilians speak Spanish because they live near the border areas or because they learned it at school.

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