Last week, David Gacs at the Americas Society/Council of the Americas wrote about the important advances Mexico, Colombia, Peru and Chile have made to open up trade with one another through the Pacific Alliance. Diverse and distant they may be, consensus is emerging that these four countries (with a combined population larger than Brazil’s) are doubling down on an outward-focused, market driven economic outlook that is lacking in other parts of Latin America. Perhaps as a result of this openness and orientation, the bloc of four nations boasts some of the fastest economic growth rates in the hemisphere.
Now, seasoned hemispheric observers will know that regional effort at integration have been less than successful. The most notable attempt, Mercosur/Mercosul, has languished in political infighting, trade disputes, and an increasingly statist orientation among member countries. Chile, ever skeptical of being grouped together with its neighbor across the Andes, never fully joined and rather pursued a successful policy of signing bilateral trade agreements.
If the nascent Pacific Alliance begins to fulfill the promise of greater regional integration and trade (already buttressed by deep, meaningful, free trade agreements already in force and interest from abroad) Mercosur’s 20-year experiment is going to look particularly futile. It’s also going to look bad for Brazil, whose economy is already being grouped together with Argentina’s in terms of levels of economic freedom and degree of state control.
Could it be that the Pacific has what it takes to be the engine of free-market growth in the region?