PRELIMINARY DRAFT - ONLY FOR DISCUSSION - COMMENTARIES WELCOME

Introduction: what is this paper about

Several decades of economic integration processes, both in European and the South American geographic regional spaces offers some ground for an exercise of comparison.

It is an interesting comparison for who are trying to understand and to explain those regional realities, for example, through their academic activities or through the media.

And yet it could be even more useful for those who are trying to influence and modify those realities through their political action. The fact that both regions could be facing some similar methodological challenges about how to work together should increase the interest of learning something about their respective experiences.

This mutual interest appears as more relevant having in mind those methodological weaknesses which could lead to a crisis of social legitimacy of an integration process, within all or some of the member States. If the question about how to work together is not adequately responded, people will began to bother about why to work together.

In this paper our main concern will be precisely to present some reflections concerning the comparison of both experiences - even if they could have more differences than common elements - in terms of their methodologies of working together with neighboring nations, voluntarily and aiming to build a permanent community of interests and goals based in common rules.

In the particular case of most South American countries, they have been involved since the middle of last century, in different experiences of deep economic integration, at least among some of them.

However and even if significant achievements have been obtained, none of those experiences have succeeded in building something similar to what the European Union has become fifty years after the Treaty of Rome was signed.

It's not our intention in this paper to recall - even in a synthetic approach - the history of integration processes in South American, nor to present their achievements and failures, both in the economic and political field. Less yet to do so with respect to the broader and more heterogeneous region recognized as Latin America [1].

On the contrary, our intention is only to identify some traits and elements to facilitate a greater understanding of those South American experiences and to facilitate its comparison with the European experiences.

Eventually, it could also imply, for our European colleagues, to facilitate their access to what could be source of inspiration for their contribution to the difficult task of solving some of the methodological challenges that the European Union is facing today.

This could be indeed a rich field for the development of future cooperation among European and South American scholars and academic institutions. Asian [2] and African experiences also should be included in this inter-regional cooperation.

In the case of the South American geographic regional space I will consider the following experiences:

• The former Andean Group, then transformed in the actual Andean Community of Nations [3];
  
  
• The bilateral Argentina and Brazil Integration and Cooperation Agreement, then transformed in the actual Mercosur process [4], and
  
  
• The recent South American Community of Nations [5] including the twelve nations of this geographical space.

To preserve the focus in the South American geographic regional space, I will not consider in this opportunity other experiences [6] also developed in the broader Latin American and Caribbean [7] geographic regional space, mainly:

• The Latin American Free Trade Association (LAFTA) created by the Montevideo Treaty of 1960, then transformed through the Montevideo Treaty of 1980 in the Latin American Integration Association (LAIA) [8] - even if formally its objectives are to promote economic integration and to develop trade among its members, de facto has been mainly a very useful framework to develop preferential trade agreements among the member countries -;
  
  
• The Central American Common Market [9]- limited to this geographic sub-region and increasingly integrating their markets with the United States through the recent CAFTA-DR [10] agreement, and
  
  
• The CARICOM - formerly CARIFTA - including most of the Caribbean countries [11].

In this opportunity our analyses will be focused in three main points:

• Some common elements in the European and South American regional integration experiences;
  
  
• Some main differences between the integration processes in South America and in Europe after their experiences of the last fifty years, and
  
  
• Main challenges ahead for both regions in their efforts to strengthen the logic of integration among their neighboring nations.

Then I will draw some brief final remarks.

1. South America and Europe: some common elements in their regional integration experiences

Which are some of the common elements that characterize both regional integration processes and experiences?

In the two cases we can identify the following common main elements:

• They are always voluntary processes developed among sovereign neighboring nations.
  
  This trait imply a huge contrast with other historic experiences of non-voluntary or hegemonic integration processes, as well with those that produced as a final result a new sovereign state, through different kind of federal methodologies;
  
  
• They work together in a permanent basis, including different economic and, eventually, political long term objectives;
  
  
• The national interest of the different member countries normally prevails in the definition of common goals and commitments [12];
  
  National interests are the main driving force for the different participating States instead of what has been called a "hypothetic supranational rationality";
  
  
• A "rule-oriented" approach to the idea of building gradually conditions of reasonable governance of a common geographic regional space [13].
  
  Contrary to what could be a pure "power-oriented process", in this kind of consensual integration process, common rules and institutions play a key role [14].
  
  Goals and targets are defined through an incremental and dynamic process of building equilibrium of the national interests of the different member countries.
  
  As a result, a perception of mutual benefits - a kind of win-win scenario - is a crucial factor for the social legitimacy of the working together idea;
  
  
• They build institutions with at least two main functions: to preserve a common vision of the integration process and to create common rules of the game in an incremental way.
  
  There is no unique model or pattern about how those institutions should be organized. From a legal point of view they are common to the association of States. But in term of its organization, composition, functions, competence, and effect of its decisions and how they are adopted, each process could have significant differences.
  
  The principle of "freedom of organization" [15] is applied in the approach that a concrete integration process could have concerning its institutions. The concepts of "supra-nationality" or of "community law and institutions" normally used in the case of the European Union, are not necessarily valid for other experiences. On the contrary, at least in the case of the South American region, those concepts have been occasionally a source of confusion especially among political leaders and also public opinion.
  
  In any case what is important is particularly the definition of the locus of governmental representation, of technical services and eventually of an independent and common vision of the member States interests, of parliamentary and civil society participation, and of a jurisdictional mechanism that could be either judicial or arbitral.
  
  In our opinion, who participates in the decision-making process and how the rules are created and their effectiveness [16] guaranteed, are some of the crucial elements to appreciate the institutional quality of a concrete integration process;
  
  
• The instruments producing market integration and preferential trade. There is no unique formula of how to do it [17].
  
  However, a common trait of deep integration processes among neighboring nations is the creation of a customs union, as a step toward a common market including free circulation of goods, services, capital, labor and people, and also some degree of common policies;
  
  Normally these regional integration processes have been developed in a compatible way with their other international commitments, particularly within the framework of the GATT and now of the WTO.
  
  Article XXIV of GATT-1994 [18] and Article V of GATS, as well as the "Enabling Clause" of GATT [19], in the case of developing countries - for example those of the South American region - are the main parameters to conciliate a deep integration process with the rules of the global multilateral trade system at the WTO;
  
  
• The main objectives of strengthening their democratic regimes and at the same time, improve their capacity to compete in the global markets, increase their bargaining power in the international scenario, and assure conditions for peace in their regional neighborhood, and
  
  
• The fact that the irreversibility of the process is not guaranteed. As a difference, for example with a federation processes, member countries can withdraw from the association or community of nations, and above all - independently of the political and economic costs - the process could eventually fail.

Those common elements, however, should be analyzed having in mind the huge differences that exist among not only both geographic regional spaces and integration processes, but also with respect their member countries. For that reason, some key differential elements should be considered in any comparison about the European and South American, historic, political, economic and cultural realities. In the next section of the paper we are going to analyze what we consider to be the most relevant elements of differentiation.

2. Main differences of both regional spaces and of their integration processes

Which are the main differences to take into account in comparing South America and Europe, both as geographic regional spaces and as integration processes?

The level of relative economic development is obviously the biggest difference among the two regions. All South American countries are considered developing nations. Indicators are very well known. Those related with social inequalities are perhaps the most important and are a consequence, among others, of economic factors [20]. But an indicator that is real and not only symbolic is that not any country of this region has been accepted as a member of the OECD, at least till now.

One consequence of the developing country condition is that there is no one, not even Brazil or Venezuela that could play the role of financing partner of the integration processes.

Open societies and democracy are not necessarily a significant difference. If we take the last three decades, it is possible to observe close societies and non democratic situations in many countries in both regions. That is more evident yet if we consider the whole XX Century. Even today, trends that eventually could jeopardize the efforts to consolidate the ideas of open societies and democratic regimes, did not complete disappear as well in South America as in Europe. Precisely, the idea of strengthening them through a consensual integration process is one of the most important common elements among the two geographic regional spaces.

Conceived as geographic regional spaces, some of the main differences to have in mind in any exercise of comparison are related with:

• Geography: contrary to what happens in the European geographic regional space, South America physical and economic distances are yet huge, especially among its principal urban centers.
  
  Until the last decades those urban centers were poorly connected. In most cases, it was normally easier to travel to or to trade with European cities and even with those of the West and East costs of the United States, than with cities of other countries of the same region.
  
  Transportation and communications were under-developed. Sea transportation was the most important way of connecting the main markets. Andean countries, including Chile were connected basically through the Pacific Ocean, and the other main maritime corridor was at the Atlantic, connecting also Argentina, Brazil, Uruguay and Paraguay with Europe and North America.
  
  One of the principal effects of the integration efforts of the last decades has been precisely, the development of important physical infrastructure for the development of corridors of trade.
  
  This is particularly today the case of the connection between the almost twenty big cities between Rio de Janeiro-Sâo Paulo- Belo Horizonte- at the North, and Asunción-Montevideo-Buenos Aires-Rosario-Cordoba-Santiago de Chile-Valparaiso- at the South.
  
  This network of important urban centers is the economic core group of what is recognized as Mercosur - as the name of a geographic space [21]-. It is where most of the industries and services are concentrated and where the capacity of consumption is greater. That explains why, at least from this point of view obviously Chile is also considered as naturally integrating the Mercosur economic space, particularly by firms operating within this network of big cities.
  
  Geography explains also the development in the last decades of different kind of common projects (among others the several bi-national Hydroelectricity Dams as are those of Itaipú, Yacyretá and Salto Grande) and of networks in the energy sector (electricity, gas and oil).
  
  The large size of the South American geographic regional space, explains also why physical contiguity has some times different meaning perceived from specific countries. Obviously South America from the Brazilian perspective represents almost all its neighboring space. But for example for Argentina and Uruguay, their contiguous region is what has been called for many decades the Southern Cone. And the perspective changes if one observe the neighboring space from Venezuela and Colombia, countries that simultaneously are strongly related with the Caribbean region.
  
  Geography is even today a source of difficulties in connecting markets in the South American space [22].
  
  But is also one of the reasons that explain the fragmentation of the integration process between two main natural spaces: the Andean - the Andean Community of Nations - and the Atlantic - Mercosur -. Linking the two natural spaces one could find - and understand its role in the South American political subsystem [23]- the Andes, the Amazonian region and, as a country, Bolivia.
  
  The geographic factor has become clearer yet in the recent times due to the crucial importance of gas and oil in the relationship among most of the countries of the region, and the particular role that will continue to play at this respect, Venezuela and Bolivia.
  
  Also geography could allow us to understand the demands for variable geometry approaches for the different integration and cooperation processes within this regional space. We are coming back to this point latter on.
  
  
• History: physical and economic distance also explains differences concerning the lack of major wars in last century in South America. Here the differences with Europe are notorious.
  
  We cannot find in South America the functional equivalent for the role played by the pattern of conflictive relations among several European countries and, particularly France and Germany, before the actual integration process was launched in 1950.
  
  That's the reason why the memory of war wasn't an incentive to promote integration within the South American region. Not even was the possibility of a new war, due to the presence of an enemy with hegemonic pretensions, as was the role that the Soviet Union played at the beginning of the European integration process.
  
  And that also could explain the fact that the United States didn't played in South America - no even in the period of Cold War - the kind of role it played in Europe, especially through the financial resources of the Marshall Plan.
  
  The lack of war memory, of "Soviet tanks" and of the Marshall Plan has therefore something to do with the great differences we observe in the development of the integration processes in Europe and in South America.
  
  
• Trade: when LAFTA was created in 1960, trade among its members was highly concentrated in few products, mostly commodities, and in few countries - mostly on the Southern Cone -. México was in all aspects very far from the core group of intra-regional trade.
  
  The marginal character of intra-regional trade for most South American countries changed during the following years. But it didn't change too much. Even today intra-Mercosur trade, for example, represents 20% of its overall foreign trade [24]. Figures changes if we consider trade in manufactured goods. But even in this case it is possible to observe a high concentration in the above mentioned network of big cities of the Mercosur countries-plus Chile - most of it, intra-industry and even intra-firm trade - and in a minor scale, at some bilateral corridors as is the case of the trade relations between Colombia and Venezuela [25].

Those figures reflect the weakness of physical and economic connectivity among the South American markets. They can also help to understand the huge existing differences compared to the European integration process.

Conceived as integration processes, we should consider the following main differences among both experiences:

• Methodologies: in the South American region, contrary to what happens now in the European region, there isn't a core group of economic integration. Even if the Andean Community of Nations and Mercosur are linked through an economic complementation agreement, none of them is playing the economic integration role of the European Union at its own regional space.

  Mercosur was supposed to play that role. That is not clear now. And for the time being it is very difficult to imagine that the South American Community of Nation could be in conditions to play that role. Only when the political commitments of the recent South American Summits are formalized in a Treaty and in concrete operational instruments, we will be able to appreciate whether it could play a similar role to the one played by the European Union, as a regional public good for the whole European geographic space. But it seems that it could take some time to reach that point.

  Meanwhile it is possible to observe that at in a larger South American scale the integration processes are still fragmented. And it is quite possible that it will continue to be so at least in the next years.

  But the real problem could be the fact that, the two main integration processes of the South American geographic regional space have had a relatively poor performance, in delivering key products which seems to be main results of the European integration process. That is to produce rules, social and business networks and also symbols.

• Rules: the quality of the rules is a crucial factor in a consensual integration process among sovereign nations. Normally they are a result of a rule creation process based in a high capacity of common institutions to build the equilibrium of national interests of member countries.

  They result also of the efficiency of common jurisdictional mechanisms capable to solve controversies among member States - related with the integration process rules - and to assure the prevalence of law.

  The European experience demonstrates that high quality institutions can produce rules with a reasonable degree of efficacy. As a result they can achieve social legitimacy [26].

  On the contrary it is possible to observe that in the South American integration processes rules have been in general of low quality. They cannot always achieve one of its main functions that are to restraint the natural inclination of member countries to resist collective disciplines, even in the case in which they have been formally accepted through common rules.

  When there are large differences of the economic dimension and degree of relative development among member countries, the low quality of rules may eventually erode the social legitimacy of the integration process. We can observe this at Mercosur, especially in the case of the smaller or least developed countries, concretely Uruguay and Paraguay.

  The fact is that low quality rules are not able to sustain in the long term the national interest dynamic balance, crucial to preserve the attractiveness of the integration process for different member countries.

  But they can also affect the perception by the business sector, about the existence of sufficient conditions for making rational investment decisions concerning the enlarged economic space. They will not believe in signals send by governments the market through low quality rules. And so the process could gradually loose its economic and political relevance.

• Networks: economic integration among neighboring nations is supposed to stimulate social interactions at all levels [27].

  The development at multiple levels of all kind of social networks - beginning with business networks as a result of trade and investments across the borders - is not only a main product of an integration of processes, but also a concrete way to assure its irreversibility.

  The web of cross social interests at the regional level - in some way Jean Monnet "solidarités de fait" - could be one of the more solid products of a rule-oriented integration process.

  But at the same time, across border social interests can contribute to further developments of common rules, resulting in a kind of "bottom-up" integration methodology.

  It is possible to observe this phenomenon in Asian economic integration experience. In that sense business and other civil society expressions had been one of the driving force toward the development of governmental agreements and regional rules.

  In the case of South America, regional social networks are increasingly visible at least in the case of the Mercosur plus Chile space. They are the result of trade and investments, but also of all kind of civil society connections, including obviously the academic community.

  This is one of the reasons that allow us to be rather optimistic about the future of Mercosur. The web of business and other social interests will most probably play a role of driving force for the development of the Mercosur process and, particularly, for the preservation of the main strategic idea, of working together among its member countries in a way that will allow them to improve their democratic systems, their economic and social performance, and their capacity to compete in the global arena.

• Symbols: they express the idea of a community of nations and of people. They allow citizens to identify themselves with the idea of a common region. They are concrete, visible, and often the result of rules that creates them.

  In the case of the European Union it seems that some of those symbols with greater impact in most citizens are the flag, the Euro, the passports, the car patents and the migration lanes at the airports.

  Nothing so strong exists yet at the Mercosur and the Andean Community level. Some of the member countries utilize the word Mercosur in the personal documents and passports of their citizens. But is not the case of all of them. The idea of having common migration lanes for Mercosur citizen at the airports has been approved by common rules. But it has no been systematically applied in all cases. Mercosur has a flag, but it is rarely showed up, for example in public buildings together with the national and eventually the regional flag, as it has been the case in the European Union.

Low quality rules and lack of common symbols are, among others, elements of differentiation of the European and South American regional experiences.

On the contrary, as mentioned before, a network of regional cross interests is increasingly emerging, particularly in the case of the Mercosur plus Chile space.

How to strengthen this trend is one of the challenges ahead for the South American region. Common rules and symbols could help, indeed, as has been the case of the European Union.

But they could be also the result of a perception by business and other civil society actors of the huge opportunities available at the common geographic regional space. In some way, the working together idea among countries could be lead by a web of working together among different social actors.

Also, further development of physical connectivity could play a positive role in the proliferation of more business and social networks in South America, especially at the Mercosur plus Chile space.

3. Similar challenges ahead?

Despite the huge differences already mentioned between the European and South American geographic regional spaces and integration processes, it seems that they could be facing some similar challenges.

Obviously it doesn't imply that they are identical in both regions. It only means that those challenges could eventually have some common traits.

Even if they are predominantly challenges with methodological relevance - about how neighbour nations can voluntarily work together on a permanent basis - it can finally produce a deep systemic legitimacy crisis - about why those nations should continue to work together -.

If really it appears that some challenges could have common characteristic, it would be possible to imagine that systematic exchanges of information and analysis about how each region is tackling them - at least at the academic level - could be rather useful.

Some of those challenges could be related with the identity of a regional space, and also, with the efficacy and social legitimacy of its institutions and rules of the integration process.

One of those challenges is related to the problem of how to deal with different political and economic realities and situations among countries of the same geographic regional space or member States of an integration process. This challenge could be a result of the fact that not all the countries included in a regional space are members of the same integration process. Or it could be the result of huge differences of relative political power, economic dimensions and degree of development among member countries of an integration process.

The more countries are part of a geographic regional space or included as members of an integration process, the greater will the difficulties to articulate their national interests.

Three main questions could be relevant in that case: which should be the limits of the enlargement of an integration process to new members?, how to conciliate the increase in the number of member States with a reasonable degree of institutional efficacy?, and how to preserve a sufficient degree of attractiveness and social legitimacy of the regional integration process?

But the difficulties would increase if, eventually, deep forces are operating in the direction of fragmentation or conflict among those countries sharing a geographic regional space or even, an integration process. Those forces could be driven by interests, cultural and ethnic differences or ideologies.

This kind of challenges could require a greater flexibility in the approaches to regional governance or to the institutional architecture of an integration process. At the level of a geographic regional space, could be necessary to develop institutional mechanisms and rules that contemplate all the differences prevailing among the countries belonging to it. It would be very difficult to reproduce in a heterogeneous region of a great number of different countries the same institutions, operational mechanisms or rules that could work well for a homogeneous region of few countries. Different formulas of "variable geometry" and "multiple speeds" could be necessary.

Some of those challenges could be observed in the enlarged European Union. But clearly they are part today of the South American agenda.

One main question is about how to develop an institutional architecture that could contemplate all the political and economic differences, that prevails today within the common South American geographical regional space and within each of its economic integration process, as are the Andean Community of Nations and Mercosur?

It is clearly one of the more complicated issues demanding a lot of creativity and political vision. The task ahead will not be easy having in mind also, the fact that not all the countries of the region share a common vision of the relations with other countries and regions, more specifically with the United States.

4. Some final remarks

Consensual integration among sovereign nations never had been lineal processes, at least according to the experiences observed both in Europe and in South America.

On the contrary, those experiences confirm the impression that they follow - and most probably they will do so also in the future - sinuous roads without end. Continues crises and the feeling of being at the border of failure is part of the normal landscape of this kind of processes. Eventually they will never have a clear point of non return, nor a final product.

They are regional public goods that through the production of rules, social networks and symbols allow neighbour countries within a geographic regional space, to build reasonable conditions to preserve among them peace and political stability, among other relevant goals.

Even if there are big and well known differences between the European and the South American geographic regional spaces, the fact is that they are developing consensual integration processes with common elements and challenges ahead. This fact, could explain the need to develop a common scholarly capacity to better understand the logics and characteristics of what they are trying to do in the direction of building regions, in which the idea of integration finally could prevail over the natural trend of fragmentation and conflict among neighbour nations.

In that sense, for the South America nations the European integration could be a model. Not necessarily concerning the institutions and rules that allow Europe to develop a process of economic integration among its neighbour nations, but yes about the need to develop "home grown" formulas to preserve the idea of integration, against that of fragmentation within a common geographic regional space.

Finally it must be said, that the fact that the international system is in a period of deep changes and of great uncertainties [28], increases the interest in the working together experiences of this two large regions, which despite clear differences they do share common history and values [29].

[1] For the analysis of different periods of integration in Latin America, see PEÑA Félix, "Momentos y Perspectivas: La Argentina en el mundo y en América Latina", Eduntref, Buenos Aires, 2003.

[2] About the multipolar approach of regional integration in Asia, see PENETTA Piero, "Il Regionalismo Multipolare Asiatico: Contributo al diritto della cooperazione istituzionalizzata fra Stati", G.Giappichelli Editore, Torino 2003.

[3] It was originally conceived as the Andean Group, created in 1969 by the Cartagena Agreement and with the participation of Chile. After several crises including the withdrawal of Chile during the Pinochet period, it was transformed in the Andean Community of Nations by the Sucre Protocol (1997). More recently Venezuela withdrew from the Community - it is not clear yet if Venezuela will not return to the Community, as full or as associated member - and almost at the same time Chile became associated member. They also modified their custom union instrument and their common trade policy and that allowed Colombia and Peru to signed FTA's with the United States (2006). They have not been yet approved by the American Congress. Also recently, the Andean Community concluded an agreement with Mercosur (2005). It is a network of preferential agreements between the members of the two integration processes within a common legal framework including common rules. It was concluded within the framework of LAIA. For more information concerning the Andean Community of Nations, see its official web page: www.comunidadandina.org.

[4] After a short period of bilateral integration process between Argentina and Brazil (from 1986 to 1991), both countries - even preserving till now their bilateral working methodologies, for example in the automobile sector, and main legal instruments (a bilateral Treaty was signed in 1988) - took the initiative of creating Mercosur, signing the Asunción Treaty (1991) that included also Paraguay and Uruguay. Trade was important but it was not the main driving force behind the idea of integration. From the beginning it had a strong political sense. Fifteen years after it was launched and despite many problems and trade controversies, Mercosur has almost completed the trade liberalization program among its members (sugar is yet excluded and the automobile sector has its special rules; many non-tariff restrictions are occasionally applied as well as technical and bureaucratic barriers - the market is far yet to be really common -) and has also a common external tariff applied to a substantial part of its foreign trade, even if there are several, de jure and de facto exceptions, but they are normally temporary and they don't exclude their final convergence. Since 2006 Venezuela became member of Mercosur, but from a legal point of view the process of enlargement has not been completed. Two countries - Brazil and Paraguay - have not yet ratified the Caracas Protocol that formalizes the incorporation of Venezuela. Chile, Bolivia and other Andean countries are also associated members of Mercosur. More recently the process for the eventual incorporation of Bolivia has been launched. It must be remembered how important is the political stability in Bolivia for other South American countries, and not only for those that are members of Mercosur. For recent bibliography about Mercosur, see among other sources, several papers of the author in its Web page: www.felixpena.com.ar and especially "Los grandes objetivos del Mercosur: zona de libre comercio, unión aduanera y mercado común", Seminar "15 Anos de Mercosul: avaliação e perspectivas", Fundação Memorial Da América Latina, São Paulo, 27 e 28 de março de 2006. See also www.redmercosur.org.uy. The main legal documents about Mercosur could be found in the official Web page: www.mercosur.int. For a recent Brazilian view about Mercosur and other developments in the South American regional space, see also the long interview to Ambassador Celso Amorim, Minister of Foreign Relations of Brazil, at the Financial Times, on February 22, 2007.

[5] The idea of a South American Community of Nations recognizes as a first step the South American Summit in Brasilia (2002), even if their were some other previous initiatives originated in Brazil. The twelve South American Nations (the Mercosur and Andean Community of Nations member countries, and also Chile, Suriname and Guiana) participate in this process that has a strong political dimension, but at the same time is related, among other objectives, with the development of the physical infrastructure integration of the region and the convergence of the different sub-regional integration and trade agreements. No Treaty has been signed till now. For the main documents concerning the South American Community of Nations and the recent Summit of Cochabamba in Bolivia (2006), see www.cumbresudamericana.bo/armado.htm and also www.wikipedia.org that includes economic information of the different countries, both in its Spanish and English version.

[6] For complete and up-dated information, legal texts and bibliography about the different Latin American integration and trade agreements see www.sice.oas.org, among other sources.

[7] Latin American and the Caribbean is the name normally utilized in relation with this heterogeneous region, as for example in the case of the periodic Summits among those countries and the European Union, see more information about those Summits in the official site of the European Union: http://europa.eu.

[8] LAIA has today twelve member countries. 8 "regional agreements" and almost 100 "partial agreements" - that are those in which only some of the member states participate and that could have different modalities including "economic complementation agreements"- have been signed within its framework. Most of the exchanges of goods among members of LAIA are benefited with some kind of preferences included in the complex network of those partial agreements. The eleven original members of LAFTA and in the last decade also Cuba, are member countries. LAIA has been presented at GATT-WTO within its Enabling Clause framework. For complete information concerning LAIA, its functions, organization and activities, and the complete list of partial agreements, see the official Web page: www.aladi.org. It is also a valuable source of statistical information about intra-latinamerican trade. One of the best sources of information concerning the foreign trade policies and international trade negotiations and agreements of the Latin American countries, can be obtained in the periodic trade policies reviews of the WTO, at www.wto.org. The most recent trade policy review is about Argentina (February 12 and 14, 2007).

[9] For information concerning the Central American Common Market, see the Web pages: www.sgsica.org and www.sieca.org.gt

[10] For information and the text of the CAFTA-RD agreement, see the Web page: www.ustr.gov as well as the Web page mentioned before at note 5. It includes the Central American nations as well as the Dominican Republic.

[11] For information concerning CARICOM, see the official Web page: www.caricom.org

[12] As regards national interest in the origins of European integration, cf. MILWARD Alan S., The European Rescue of the Nation-State, University of California Press, Berkely & Los Angeles, 1992; see memorandum of Jean Monnet, May 3,1950, in Le Monde, May 9, 1970. See also, PEÑA Félix, "Previsibilidad y eficacia: la integración voluntaria entre naciones soberanas", in Encrucijadas, Revista de la Universidad de Buenos Aires, February 2001, p. 48.

[13] For further development see PEÑA Félix, "Reglas de juego e instituciones en el Mercosur," Revista de Derecho Privado y Comunitario, n° 14, Santa Fé 1997, p. 395; and also the following papers: "Reglas de juego, instituciones e integración económica: reflexiones desde el Mercosur," in Archivos del Presente, Buenos Aires, October-November-December 2000, p. 97; "Concertación de intereses, efectividad de las reglas de juego y calidad institucional en el Mercosur", Informe elaborado para el Programa Estado de Derecho de la Fundación Konrad Adenauer y la Red Mercosur, Mayo 2003, and "Civil Society, Transparency and Legitimacy in Integration Processes and Trade Negotiations: Mercosur's experience and lessons for the negotiations with the European Union", paper prepared for the Chaire Mercosur -Sciences Po- Working Group on EU-Mercosur Negotiations Annual Seminar, September 2003 (www.chairemercosur.science-po.fr)

[14] For the distinction between "rule-oriented" and "power-oriented" processes, see JACKSON John, "The World Trading System. Law and Policy of International Economic Relations", Second Edition, The MIT Press, Cambridge, Massachusetts 1997, ps. 109-111.

[15] See SEREGNI Angelo Piero, "Le Organizzazione Internazionale", Dott.A.Giuffré, Milano 1959.

[16] The concept is used in the sense presented by DE VISSCHER Charles, "Les Effectivités du Droit International Public", Editions Pedone, Paris 1967 and TOUSCOZ Jean, "Le Principe D'Effectivités dans l'Ordre International", LGDJ, Paris 1964.

[17] For an history of different approaches to the development of market integration and free trade agreements, see among others, MACHLUP Fritz, "A History of Thought on Economic Integration", Columbia University Press, New York 1977; see also, NOLDE B. "Droit et Technique des Traités de Commerce", chapitre X, "Les Unions Douaniéres", in Recueil des Cours de l'Académie de Droit International, La Haye 1924, ps.437-50, and ANDERSON Kym and Hege NORHEIM, "History, geography and regional economic integration", in Regional Integration and the Global Trading System, edited by Kym ANDERSON & Richard BLACKHURST, St.Martin Press, New York 1993, ps.19-51.

[18] See SNAPE Richard H., "History and Economics of GATT's Article XXIV", in Regional Integration and the Global Trading System, edited by Kym ANDERSON & Richard BLACKHURST, St.Martin's Press, New York 1993, ps.283-87,

[19] It was negotiated and approved during the Tokyo Round (1979), for historical background see WINHAM Gilbert, "International Trade and the Tokyo Round Negotiation", Princeton University Press, Princeton, New Jersey 1986, ps.141-46 and 274-80, and also, SRINIVASAN T.N. "Developing Countries and the Multilateral Trading System", Westview Press 1998, ps.21, 24 and 99.

[20] The main economic and social indicators of South American countries can be found, among other sources, at the Web pages of the World Bank (www.worldbank.org), the Interamerican Development Bank (www.iadb.org) and Economic Commission for Latin American and the Caribbean (www.eclac.cl).

[21] To understand Mercosur is necessary to have in mind that the name is used simultaneously to identify: a geographic space - its delimitation will largely depend on differences of each national perspective, for example that of Brazil or Uruguay, and now even of Venezuela, and of each sector, for example energy production and distribution, or car and food industries -; an strategic idea - that is to work together among its member countries as a way to improve their own capacity to consolidate their democratic systems, modernize their economies and compete at the global markets - and a formal process of economic integration - originated at the already mentioned Asunción Treaty -. Most of the well known problems of Mercosur are the result of developments - or lack thereof - at this third level. What must be clear to understand most recent developments in the region, is the fact that a broad definition of Mercosur as a geographic space - logical from a Brazilian point of view - would lead to equalize its dimension to that of the overall South American space. That could help to explain some confusion raised by the idea of the South American Community of Nations. A narrow definition, instead, could lead to confusion with the older idea of the Southern Cone Countries. The fact that Venezuela became member of Mercosur explains perhaps the most recent trend to equalize Mercosur with the South American Community of Nations. It cannot anymore be conceived as only a Southern Cone space and process, nor the strategic idea limited to this more restricted geographic regional space. See PEÑA Félix, "Understanding Mercosur and its Future", Jean Monnet/Robert Schuman Paper Series, Vol.5 No. 14, June 2005: http://www6.miami.edu/eucenter/penafinal.pdf

[22] Obviously it is not the only factor. Other factors that in the past also played a relevant role, were related with the pattern of foreign trade of the different countries - concentrated in few commodities exported to few industrial countries - as well with economic policies - i.e. import substitution strategies on the early period of industrial development. The lack of integration that is possible to observe yet on the markets of two big neighbor cities, as are Montevideo and Buenos Aires, demonstrates that geographic distance has not been the only relevant factor.

[23] For an historic analysis of South American as an international power subsystem, see BURR Robert, "By Reason or Force: "Chile and the Balance of Power in South America, 1830-1905", University of California Press, Berkeley, Los Angeles, London, 1965. For an historic background about the Southern Cone sub-region, see Cf. JAGUARIBE Helio, "Brasil-Argentina: Relações de conflito e cooperação," in Revista Brasileira de Política Internacional, 93-96, 1981, p. 131; FRAGA Rosendo, "Evolución histórica de los países del Mercosur," in Mercosur: un atlas cultural, social y económico, Ediciones Manrique Zago e Instituto Herbert Levy, Buenos Aires, 1996, p. 91; and METHOL FERRÉ Alberto, "Mercosur, América del Sur y América Latina," in idem, p. 119.

[24] It represented 9% in 1990 and 25% in 1997.

[25] For more detailed statistical figures, see the analysis of intra-Mercosur trade in the Web page of the Center for International Economics at the Ministry of Foreign Relations of Argentina, www.mrecic.gov.ar and in the case of intra-Andean trade, the at Web page of the Andean Community of Nations, www.comunidadandina.org. Also valuable sources of information are the periodic reports of the Institute of Latin American and Caribbean Integration of the Interamerican Development Bank, at the Web page: www.iadb.org/intal.

[26] For the development of this point see PEÑA Félix, "Consensual Integration Alliances: The Importance of Predictability and Efficacy in the Mercosur Institutional Experience", Miami European Union Center, University of Miami, Jean Monnet/Robert Schuman Paper Series, Vol. 2 N° 3, March 2003 (www6.miami.edu/eucenter/pena_03.pdf).

[27] For the "net-work integration" concept, see CASTELS Manuel, "End of Millennium", Blackwell Publisher, Oxford 1998, ps.330-332.

[28] Two recent books are, among many others, very useful to understand the more recent evolution of the international system and the value that should be attached to the regional integration efforts both in Europe and in South America, among other relevant regions of the world. See: HABERMAS Jürgen. "The Divided West", Polity Press Ltd, Cambridge UK, 2006, y HEISBOURG François, "L´Épaisseur du Monde", Les Essais, Éditions Stock, Paris 2007.

[29] For the future relation of both regions and, in particular, of the European Union-Mercosur negotiating process see PEÑA Félix, "Apuntes sobre la Presidencia alemana de la Unión Europea y el futuro de las relaciones con el Mercosur", to be published in Diálogo Político, 01/2007, periodic publication of the Konrad Adenauer Foundation, Buenos Aires 2007 (www.kas.org.ar). See also, BENEYTO José María (dir) y ARGEREY Patricia. (coord), "Europa y América Latina: El otro diálogo transatlántico", Acción Jean Monnet, Biblioteca Nueva, Instituto Universitario de Estudios Europeos de la Universidad CEU- San Pablo, Madrid 2006; FUNDAÇÂO KONRAD ADENAUER - Centro de Estudos, "Europa-América Latina: construyendo una nueva agenda biregional", Análisis e Informaciones, nº 22, Rio de Janeiro 2006; ROY Joaquín, LLADÓS José María y PEÑA Félix (comp), "La Unión Europea y la integración regional: Perspectivas comparadas y lecciones para las Américas", CARI-UNTREF-University of Miami, EDUNTREF, Buenos Aires 2005, and CELARE, "Las Relaciones Eurolatinoamericanas: De la Cumbre de Viena a la Cumbre de Lima", CELARE, Santiago de Chile 2006.