The second issue of Panorama Internacional FEE deals with an important and complex topic, which allows multiple and interrelated possible angles of analysis, such as economic, political and cultural. The Latin-American integration has been debated for a long time in the region. In the economic field, conjectures about the potential effects of productive integration have always been considered when it comes to difficulties and limitations of late and peripheral industrialization in Latin America. The “closed” character of that process, in the sense that industrial plants were installed to supply the restricted national markets, was pointed out as responsible for the disadvantages in absolute costs, related to the smaller scales of production compared to those of the previously industrialized countries. In a speech in Mexico in 1959, Raúl Prebisch[1] evoked this diagnosis in advocating the formation of a Latin American Common Market. In his view, this would be the way to avoid repeating the known limitations of the already established consumer goods industries in the necessary and subsequent phase of installing the sectors of capital goods. The strategy envisioned by Prebisch did not recommend the promotion of partial integration as preparatory action for a second continental integration phase. For the Argentine economist, the more strengthened the sub-regional groups were, the more difficult it would be to achieve the Latin American Common Market.
Actually, the integration in continental scale as advocated by Prebisch has poorly advanced. Moreover, one could hardly attribute this state of affairs to obstacles created by the development of sub-regional integration groups such as Mercosur. These groups have not advanced so much as to the point of generating additional obstacles more important than those already underlying the national borders or those related to the very nature of capitalism. Contradictions and conflicts of interest among countries, sub-national political units, transnational corporations and domestic political groups seem to be enough to constitute a somewhat complex system of barriers to integration. The historical development of that system has not generated so far a solution that could promote significant advances in Mercosur as a process of economic integration.
The adoption of a model to guide the promotion of such integration, resulting from other historical experiences, is quite complicated. The European Union is probably the most developed case of an institutional framework designed to promote integration. However, the recent slow economic growth of the bloc as a whole, the acute problems that the “peripheral” countries have faced, alongside the behavior of “core” countries concerning such problems, indicate serious limitations and contradictions about the values and goals sustaining the integration. Macroeconomic rules adopted to satisfy particular interests have been suffocating some member countries and led many European citizens to embrace a kind of moral judgment that some countries “do not deserve” to be part of the Euro Zone.
On the other hand, despite the absence of an institutional apparatus comparable to that of the European Union, there has been a strong process of productive integration in Asia. Several geopolitical, structural, organizational and economic factors contributed to this outcome (MEDEIROS, 2011)[2]. The data transmission revolution and digitalization enabled the encoding of productive processes and their modularization. From a technical point of view, these changes have made possible the establishment of a large trade flow of parts and components, integrating the lower income Asian countries to those previously industrialized. The asymmetric position of the countries, which may be reinforced for the balance of payments problems, was at least in part neutralized in this Asian integration by macroeconomic stimulus and structural conditions both functional for integration. The regional expansion and its productive integration in Asia have always been oriented to a large consumption market of final goods. The United States was the first market running trade deficits with the less developed countries, and has been progressively replaced in this role by China.
In the case of Mercosur, within certain limits, Brazil could perform this role because of its relative size. To make it happen, however, Brazil would need to increase growth and stop perceiving other countries only as useful markets to compensate the reprimarization of its exports to other continents. In other words, a productive integration along the Asian lines would require Brazil to run trade deficits with the bloc, rather than channeling its more technology-intensive industrial production, displaced from other markets by the Asian producers. It would be necessary, therefore, for Brazil to promote more deeply its domestic market, managing adequately its external constraints at the same time. Arrangements that could promote a joint management of the external constraints would be supportive to integration. The external problems of Brazil and Argentina, especially, have already caused, and always may cause again, serious imbalances for Mercosur to consolidate.
Addressing the issue of Mercosur, Panorama Internacional FEE does not intend to provide definitive answers to all these complex issues. The purpose is to put forward some elements to invite the reader to join the debate. In that sense, researchers Cecília Hoff and Tomás Torezani discuss Rio Grande do Sul’s position in the Mercosur context, highlighting the particularities of trade and productive relations of the state with the other countries and calling attention to the agricultural capital goods sector and the conflict of interest established by the movements of the Argentine industry. Researcher Ana Julia Possamai presents a central dimension: digital integration. Although still receiving little attention in most economic analyses on integration, a slow development in this field may represent an important constraint on productive integration in the era of modularization of production, apart from the political and cultural implications. The interview of this issue of Panorama brings Professor André Luiz Reis da Silva, from Universidade Federal do Rio Grande do Sul (UFRGS). He provides some impressions about achievements and challenges of Mercosur, the accession of Venezuela and the possibility of a free trade agreement with the European Union, along with other issues. Robson Valdez, Ricardo Leães and Bruno Jubran address the need for a political settlement inside the bloc, noting that the economic agreements underlying a process of economic integration presuppose an appropriate balance of costs and benefits to potential participants. Finally, Tarson Nuñez brings us important conjectures about the outcome of the presidential election in Argentina. The situation in that country is always substantial for a conjuncture analysis of the region, considering the more radical changes associated with political changes there from a Brazilian standpoint.
[1] PREBISCH, R. El mercado comun latinoamericano. Boletin del Banco Central del Ecuador, Quito, v. 33, n. 384-385, p. 19-28, jul./ago. 1959. Retrieved from <http://hdl.handle.net/11362/32866>.
[2] MEDEIROS, C. A dinâmica da integração produtiva asiática e os desafios à integração produtiva no Mercosul. Análise Econômica, Porto Alegre, v. 29, n. 55, p. 7-32, mar. 2011. Retrieved from <http://seer.ufrgs.br/AnaliseEconomica/article/view/13381>.
