Americas
an examination of current affairs in the hemisphere
EU Decides to Play Ball with Willing Partners
Last Friday in Lima, Peru, the heads of state and government
of nearly 60 countries met at the 5
th European Union and Latin American and Caribbean
Countries Summit.
Everything went well—well, according to the hosts, meaning without surprises, without some vociferous leaders hijacking the agenda, improvising proposals, or engaging in public confrontations. And, as usual, some leaders made the most out of bilateral encounters, while others wasted yet another opportunity.
The build up leading to the summit was not auspicious. On May 12, German Chancellor Angela Merkel said that Venezuelan President Hugo Chavez "does not speak for Latin America." In his ensuing diatribe, the Venezuelan leader accused Ms. Merkel of representing the politics of the German right that supported the Nazis. This was not, nor will it be, the last of Chavez's quest for the headlines through base insults to another head of state. Another of his spectacles was feared at the summit. It did not happen.
A rather subdued Chavez spent most of his time trying to make nice with everyone, with the sole exception of Colombian President Alvaro Uribe. Interpol released a report on Thursday corroborating that the computers found in the FARC guerrillas' camp in Ecuador had not been tampered with. The links between the Venezuelan government and the Colombian terrorists, exposed by the documents in the retrieved laptops, are now beyond doubt. Ecuador's president, Rafael Correa, also implicated by the findings, parroted Chavez's assertion that the "problem in the region is the Colombian government."
The Europeans have a different opinion. Spanish Prime Minister Jose Luis Rodriguez Zapatero was unequivocal: The FARC are responsible for the tragedy, the deaths, and the kidnappings. EU Commissioner for External Relations Benita Ferrero-Waldner reiterated that the FARC would remain listed as a terrorist organization. She also said that as well as protecting human rights and democracy, it is important that Latin American countries provide European investment with legal certainty.
The EU had formally expressed its concerns to Bolivian President Evo Morales on how his actions continue to worsen the climate for investment in the Andean country. In Lima, he decided to play soccer at the parallel summit—and speak to the meagre audience at their closing event. Morales also accused the host, President Alan García, of negotiating with the EU behind his back as a key aspiration for Peru and Colombia made its way into the final declaration: The EU will allow different rhythms in the negotiations of a free trade agreement with the Community of Andean Nations (CAN).
It has been an objective of the EU to negotiate free trade deals with Latin America bloc to bloc. Yet regional integration on this side of the Atlantic is a different reality, which hinders the viability of the EU's objective. The Lima Declaration emphasizes the political priority for concluding the association agreements between the EU and the CAN, and the EU and Central America, as well as reactivating negotiations with Mercosur. The EU already has bilateral agreements with Mexico, Chile, and—in a different context—with the Caribbean Forum.
The CAN is divided. Colombia and Peru are ready and willing to conclude a free trade deal with the EU; Ecuador is very reluctant; and Bolivia is opposed to such an agreement. By acknowledging the need for flexibility, the EU has opened the door to going ahead with the willing partners.
In the case of Mercosur, negotiations with the EU began more than a decade ago and have been stalled for quite some time. While bilateral trade and investments have increased consistently, benefiting the Mercosur economies, the division between these countries and their different approaches might hamper the renewal of negotiations. While Brazilian and Uruguayan macro-economic fundamentals and policies are sound, the situation of the other two Southern Cone partners casts some doubts. In Paraguay, newly elected President Fernando Lugo's position is still unknown, but his choice of minister of the economy sent an encouraging sign. In Argentina, the economic outlook is not good: The government of President Cristina Kirchner is determined to strangle the agro-industrial sector, responsible for the economy's sustained growth since the 2002 crisis, and inflation is back, with the official figures lacking credibility.
Much has been debated about the effectiveness of summits to deliver concrete results. For the EU, with its heads of state meeting—in the European Council—up to four times every year, summits are institutionally inserted within its overall structure. The design of long-term strategic guidelines can be combined with the capacity to respond adhoc to pressing issues. Most other regional or inter-regional summits in the world are less structured, opening the door for declarations filled with empty rhetoric, and lacking in precise, tangible and measurable goals.
The Lima declaration represents a step forward in identifying key issues, and raising awareness on others. It includes the Lima Agenda, divided into three areas, with ambitious goals and specific policy recommendations. It very clearly establishes the need to preserve and promote sound macro-economic policies and a secure investment climate. It also recommends mechanisms like debt swap for social investment, the establishment of private-public partnerships, access to new sources of financing, and the establishment of funds for social solidarity, and counter-cyclic funds to finance social policies.
As these are non-binding accords, we can only hope that the leaders of the Latin American and Caribbean countries would strive to implement the Lima Agenda. Beyond the moral imperative of improving the lives of their peoples lies a very real incentive: the EU is the main foreign investor in the Latin American and Caribbean region, its second-largest trading partner and, with $1.85 billion per year, also the leading provider of development assistance. As the Lima summit showed, we know that some leaders and their countries are on the right track.
Everything went well—well, according to the hosts, meaning without surprises, without some vociferous leaders hijacking the agenda, improvising proposals, or engaging in public confrontations. And, as usual, some leaders made the most out of bilateral encounters, while others wasted yet another opportunity.
The build up leading to the summit was not auspicious. On May 12, German Chancellor Angela Merkel said that Venezuelan President Hugo Chavez "does not speak for Latin America." In his ensuing diatribe, the Venezuelan leader accused Ms. Merkel of representing the politics of the German right that supported the Nazis. This was not, nor will it be, the last of Chavez's quest for the headlines through base insults to another head of state. Another of his spectacles was feared at the summit. It did not happen.
A rather subdued Chavez spent most of his time trying to make nice with everyone, with the sole exception of Colombian President Alvaro Uribe. Interpol released a report on Thursday corroborating that the computers found in the FARC guerrillas' camp in Ecuador had not been tampered with. The links between the Venezuelan government and the Colombian terrorists, exposed by the documents in the retrieved laptops, are now beyond doubt. Ecuador's president, Rafael Correa, also implicated by the findings, parroted Chavez's assertion that the "problem in the region is the Colombian government."
The Europeans have a different opinion. Spanish Prime Minister Jose Luis Rodriguez Zapatero was unequivocal: The FARC are responsible for the tragedy, the deaths, and the kidnappings. EU Commissioner for External Relations Benita Ferrero-Waldner reiterated that the FARC would remain listed as a terrorist organization. She also said that as well as protecting human rights and democracy, it is important that Latin American countries provide European investment with legal certainty.
The EU had formally expressed its concerns to Bolivian President Evo Morales on how his actions continue to worsen the climate for investment in the Andean country. In Lima, he decided to play soccer at the parallel summit—and speak to the meagre audience at their closing event. Morales also accused the host, President Alan García, of negotiating with the EU behind his back as a key aspiration for Peru and Colombia made its way into the final declaration: The EU will allow different rhythms in the negotiations of a free trade agreement with the Community of Andean Nations (CAN).
It has been an objective of the EU to negotiate free trade deals with Latin America bloc to bloc. Yet regional integration on this side of the Atlantic is a different reality, which hinders the viability of the EU's objective. The Lima Declaration emphasizes the political priority for concluding the association agreements between the EU and the CAN, and the EU and Central America, as well as reactivating negotiations with Mercosur. The EU already has bilateral agreements with Mexico, Chile, and—in a different context—with the Caribbean Forum.
The CAN is divided. Colombia and Peru are ready and willing to conclude a free trade deal with the EU; Ecuador is very reluctant; and Bolivia is opposed to such an agreement. By acknowledging the need for flexibility, the EU has opened the door to going ahead with the willing partners.
In the case of Mercosur, negotiations with the EU began more than a decade ago and have been stalled for quite some time. While bilateral trade and investments have increased consistently, benefiting the Mercosur economies, the division between these countries and their different approaches might hamper the renewal of negotiations. While Brazilian and Uruguayan macro-economic fundamentals and policies are sound, the situation of the other two Southern Cone partners casts some doubts. In Paraguay, newly elected President Fernando Lugo's position is still unknown, but his choice of minister of the economy sent an encouraging sign. In Argentina, the economic outlook is not good: The government of President Cristina Kirchner is determined to strangle the agro-industrial sector, responsible for the economy's sustained growth since the 2002 crisis, and inflation is back, with the official figures lacking credibility.
Much has been debated about the effectiveness of summits to deliver concrete results. For the EU, with its heads of state meeting—in the European Council—up to four times every year, summits are institutionally inserted within its overall structure. The design of long-term strategic guidelines can be combined with the capacity to respond adhoc to pressing issues. Most other regional or inter-regional summits in the world are less structured, opening the door for declarations filled with empty rhetoric, and lacking in precise, tangible and measurable goals.
The Lima declaration represents a step forward in identifying key issues, and raising awareness on others. It includes the Lima Agenda, divided into three areas, with ambitious goals and specific policy recommendations. It very clearly establishes the need to preserve and promote sound macro-economic policies and a secure investment climate. It also recommends mechanisms like debt swap for social investment, the establishment of private-public partnerships, access to new sources of financing, and the establishment of funds for social solidarity, and counter-cyclic funds to finance social policies.
As these are non-binding accords, we can only hope that the leaders of the Latin American and Caribbean countries would strive to implement the Lima Agenda. Beyond the moral imperative of improving the lives of their peoples lies a very real incentive: the EU is the main foreign investor in the Latin American and Caribbean region, its second-largest trading partner and, with $1.85 billion per year, also the leading provider of development assistance. As the Lima summit showed, we know that some leaders and their countries are on the right track.
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