Mercado Común del Sur, commonly referred to as MERCOSUR, is a South American trade bloc established to foster economic cooperation and integration among its member countries.
Historical Context
MERCOSUR was founded on March 26, 1991, with the signing of the Treaty of Asunción by Argentina, Brazil, Paraguay, and Uruguay. Venezuela joined as a full member in 2012 but was suspended in 2016 due to political and economic issues.
Key Events
- 1991: Formation of MERCOSUR with the Treaty of Asunción.
- 1994: Signing of the Ouro Preto Protocol, giving MERCOSUR a legal personality under international law.
- 2012: Venezuela’s full membership ratified.
- 2012-2014: Paraguay’s suspension following the impeachment of President Fernando Lugo.
- 2016: Suspension of Venezuela’s membership due to non-compliance with MERCOSUR regulations.
Types/Categories of Membership
- Full Members: Argentina, Brazil, Paraguay, Uruguay
- Associate Members: Bolivia, Chile, Colombia, Ecuador, Guyana, Peru, Suriname
- Observer Countries: New Zealand, Mexico
Objectives and Goals
The primary aim of MERCOSUR is to promote free trade and the fluid movement of goods, people, and currency. It aims to:
- Eliminate tariff and non-tariff barriers among member states.
- Harmonize economic policies and regulations.
- Promote the expansion of trade and investment opportunities.
Economic Models and Integration
MERCOSUR follows an economic integration model that includes:
- Customs Union: Establishes common external tariffs for non-member countries.
- Common Market: Allows free movement of goods, services, capital, and labor.
- Economic Cooperation: Harmonization of macroeconomic policies among members.
Importance
MERCOSUR is significant due to:
- Economic Impact: Home to the majority of Latin America’s population and contributing substantially to the region’s GDP.
- Trade Influence: Enhances trade within member states and presents a unified front in international trade negotiations.
Applicability and Examples
- Trade: Reduction of import/export duties between Argentina and Brazil leading to increased automobile production and sales.
- Labor: Easier migration policies, allowing professionals to work across member states.
Considerations
While MERCOSUR aims to integrate economically, it faces challenges such as political instability, economic disparity among member states, and compliance issues.
Related Terms
- Andean Community: Another South American trade bloc with similar goals.
- European Union (EU): Often compared to MERCOSUR in terms of economic integration.
- NAFTA: North American trade agreement offering a comparative study.
FAQs
Q: What are the benefits of being a MERCOSUR member?
A: Benefits include increased trade opportunities, reduced tariffs, economic cooperation, and the free movement of labor and capital.
Q: Why was Venezuela suspended from MERCOSUR?
A: Venezuela was suspended due to non-compliance with MERCOSUR regulations, especially concerning democratic and human rights standards.
Quotes
“The true wealth of a nation lies in its human resources, and MERCOSUR is committed to fostering the growth of this wealth through cooperation.” — MERCOSUR Secretariat
Final Summary
MERCOSUR represents a significant effort towards economic cooperation and integration in Latin America. Despite facing various challenges, it has successfully created a framework for trade and investment among its member countries. Its impact on regional development and international trade dynamics continues to be profound.
References
- Treaty of Asunción, 1991
- Ouro Preto Protocol, 1994
- MERCOSUR Secretariat Official Documents
Mermaid Diagram
graph LR
A[MERCOSUR]
A --> B[Full Members]
B --> C[Argentina]
B --> D[Brazil]
B --> E[Paraguay]
B --> F[Uruguay]
A --> G[Associate Members]
G --> H[Bolivia]
G --> I[Chile]
G --> J[Colombia]
G --> K[Ecuador]
G --> L[Guyana]
G --> M[Peru]
G --> N[Suriname]
A --> O[Observer Countries]
O --> P[New Zealand]
O --> Q[Mexico]
This article provides a comprehensive understanding of MERCOSUR, its history, structure, economic impact, and significance in Latin America.
