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VHeadline.com guest commentarist Richard Smith writes: Contacts between Latin America and Asian governments have been flourishing this year as the new generation of Latin presidents seek trading alternatives to the US and Europe, and at the same time are faced with the real possibility of integrating the continent politically, socially and commercially for the first time since 1830.

Moves by Latin American countries to reach bilateral trade agreements with China have made headlines in recent weeks. First of all in May, Brazilian President Luiz Inacio Lula Da Silva's visit to China with 18 ministers and 500 business people from all major productive sectors, and then in June an almost facsimile visit by Argentinean President Nestor Kirchner to China with several ministers and 270 business people.

In a similar vein, Mexico has finally reached a free trade agreement with Japan, and Chile is negotiating with India on the same basis, and already has a free trade pact with South Korea. Add to this the fact that Venezuela is now an associate member of Mercosur as of July 8, which was announced at the Mercosur summit in Iguazu on the triple Brazilian — Paraguayan — Argentinean border and which coincidentally (?) was attended by observers from China, Japan, South Korea, Singapore and Egypt.

Venezuelan President Hugo Chavez is due to visit China in October in order to consolidate relations and one suspects to talk about “oil”, as energy demand increases in China reflecting its continuing breakneck economic growth.

During the Iguazu summit Venezuela and Argentina signed an agreement to give birth to “Petrosur” … a multi-state oil company which will eventually be conformed by the national oil companies of Argentina, Bolivia, Brazil, and Venezuela … with Petroecuador and Ecopetrol of Colombia likely to be invited, as long as they are not privatized before the next presidential elections in these countries.

Petrosur is being touted in the conservative press as a sort of South American OPEC (hence semantically as an implicit threat to the oil guzzling first world nations) but in reality is seen by many political observers as the first step to Latin American integration not only in terms of free trade, but also in social, political and more importantly human terms. This concept of integration is taking place under the banner of “ALBA” — Bolivarian Alternative for the Americas – which is far more encompassing than just free trade, as typified in the clauses of the FTAA.

The South American Atlantic “axis” of Caracas — Brasilia — Buenos Aires has made it abundantly clear that they will not sign the FTAA agreement due to come into force on 1st January 2005 and is steaming ahead to form the unity of South American nations as an anti-imperialist bulwark against the United States, the IMF and the World Bank, with other projects on the drawing board. These include plans for a “University of the South”, the establishment of the IHF (International Humanitarian Fund) and a South American Bank to compete with the IMF so that the international reserves of South American nations will be deposited here and not in traditional US, Japanese of European havens. Recalling the G15 summit in Caracas which took place in February, the seeds of this “integration of the south” have already been sown in the collective minds of the African nations, historically also victims of unbridled imperialism and poverty.

Information is the key: The signing of an agreement between the state television of Argentina and Venezuela is also another step to real South American independence in order to “break the hegemony in energy and communications” as stated by Chavez in Iguazu. A South American satellite TV station is essential in order to combat the dominance of CNN, CNN en espanol and CNN Brasil, for example, which appear more and more at the service of US imperialist pretensions in the region. Long term, this is vital since, for example, news on Bolivia is recycled via Atlanta, and re-broadcast to neighboring Paraguay and other countries as the “definitive version” of events, after being sanitized to conform with US values and interests.

In the 1990s any form of South American integration was always light years away, despite the existence of the ineffective Andean Pact and the creation of Mercosur, as the US imposed the “new world order” in the region using the IMF and World Bank as neocolonial tools to enslave the region with an ever increasing foreign debt burden. For the first time since the days of Simon Bolivar almost 175 years ago, the idea of South American unity has been resuscitated with the first building blocks being put into place, even though there is an awful long way to go.

Obstacle course: One of the main problems could be the existence of bilateral trade agreements between the US and individual nations or small groupings such as the recently signed Central American Free Trade Agreement (CAFTA) and the Andean Trade Preference Agreement (ATP) signed by all Andean Nations except Venezuela on August 2001. Chile, for example has a free trade agreement with the US, based on the same premises as NAFTA, and recently Uribe was in Washington negotiating a similar one for Colombia.

(In this case, Uribe is under pressure from Washington as Colombia is in hock for US$3 – 4 billion for aid granted for Plan Colombia)

The problem resides in unwinding these agreements while tightening South American unity in the framework of the ALBA, but legal cases could be flying as the US attempts to block these moves in the international courts probably alleging some sort of “conflict of interests”. We will have to wait and see on this one, as there is always the latent threat of US intervention considering the number of US military bases throughout the region.

The Mercosur summit in Iguazu was also interesting when taking into consideration the presence of Vicente Fox. As an ex Coca Cola executive, he can easily be imagined as a proponent of free trade in the concept of the NAFTA, and also as a direct representative if US interests in terms of the Puebla — Panama plan — but as a supporter of South or Latin American integration against the “imperialist threat”?

This takes some believing, even though Chavez did make a point of including Mexico in the ALBA plans, by mentioning this country specifically.

Just by superficially analyzing the facts and events mentioned in this article indicates that there are clear signs that the pattern of world trade is shifting from the traditional dependence on the mature US and Europe markets to Asia, as the new consumers of this region continue to multiply, and Asian economies grow at a faster pace than their western counterparts, after the resolution of the East Asian economic crisis that started in late 1997. At the same time, South American nations are fortifying and expanding the Mercosur block with the oil reserves of Venezuela bolstered by the multi-state oil company

“Petrosur”… as a the motor of regional development and integration … and which could include all state owned oil companies in the medium term. In the same way, the planned South American satellite TV station could include many countries participating, with the result of strengthening traditional regional values away from the “McDonaldizing” of the younger generation’s mentality.

Conclusions?

Many could be drawn and we will have to wait as this geopolitical chess game develops, and the reaction of the US to this “back yard rebellion.”

(The 1823 Monroe Doctrine is still enshrined in US law!)

Nonetheless, it appears as if the FTAA will not be signed either by Brazil, Argentina or Venezuela, as the current governments of these countries are looking inwards to consolidate “continental homeland integration,” and eastwards in search of new markets, distancing themselves from the neoliberal practices and trade dominance that have pervaded the Latin American region since the dissolution of the Soviet Union in 1991.

 Richard Smith is based in La Victoria (Aragua). He was born 1950 in Wolverhampton (UK), and obtained a Masters Degree from the University of London and the University of Marburg-an-der-Lahn (Germany) forming close contacts with Latin America and more especially Venezuela since 1977. An expert in international marketing, he is a regular contributor to the specialized press directed at the leather industry (Spanish and English), represents a global fair group in Latin America and recently launched the cyber magazine Leather Press. One of his main concerns are the establishment of some form of “social justice” in Latin America since: “As I grew up in a post WWII society where free health care, education, jobs and social security were taken for granted, it came as an ugly surprise to discover that these elements do not exist for 90% of Latin Americans. Thus, social organization at the base is essential if the dispossessed are ever to ease their way put of the poverty trap.” Richard Smith may be contacted at email mailto:richardsmith98@hotmail.com

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