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Author`s name Dmitriy Sudakov

Bilateral controversies undermine Latin American integration

The US strategy to negotiate free trade deals individually has shattered attempts to unify politics across the continent.

The unilateral decision taken by the Bolivian president Evo Morales to nationalize the country’s gas reserves sparked a new controversy across Latin America about the possibility of the political and economic integration. Despite all regional leaders praise for the construction of a solid bloc from Mexico to Argentina to face the challenges of the global world, the continent looks fragmented as national interests prevail.

In the current scenario, the US strategy to negotiate commercial agreements with Latin American countries individually has given good results for its plans to abort any intention to form a joint force in its southern border. Washington has recently signed free trade deals with Chile, Peru, Colombia and Central America, as fuels similar agreements with Uruguay and Paraguay.

These agreements have undermined bilateral relations among South American nations. Venezuela has accused Colombia and Peru of breaking off previous obligations assumed in the Andean Community of Nations and announced its intentions to leave the regional bloc. Farther south, Uruguay’s Socialist president Tabare Vazquez said in Washington - after meeting with President Bush - that Montevideo was ready to quit from the Mercosur bloc - which forms with Argentina, Brazil and Paraguay - if it restricts its plans to discuss trade agreements individually.

Argentina and Uruguay are facing an unprecedented dispute over the construction of two multinational cellulose factories along the Uruguayan side of the international river that separates both countries. Buenos Aires says that the plants would seriously pollute a touristic region of Argentina, but Montevideo minimizes the environmental impact of the project.

Paraguay, in turn, blames on Argentina over the international tender to build a new hydroelectrical plant in the border between both countries. According to Asuncion, Argentina wants to benefit a local company instead of leading a fair tender with equal chances for all the international investors interested in the $ 400 million business. Among these foreign companies is the Russian Energomatchexport, which could suffer from the discrimination of the Argentine authorities. The controversy led to a legal demand presented before the local courts by the Argentine center-left leader, Elisa Carrio, aimed to investigate a possible case of corruption in the contracts.

Brazilian companies are furious with Bolivia’s leader Evo Morales over the unilateral decision of La Paz to nationalize its gas industry. Brazil’s industrial core, Sao Paulo, largely depends on the supply of the cheap Bolivian natural gas, which is being extracted by the Brazilian oil company Petrobras.

Officially, Brazil’s president Luiz Inacio Lula Da Silva met last week with his counterparts of Bolivia, Venezuela and Argentina to discuss the future energy integration of South America after the Evo Morales’ measures. However, it became known later that Lula and Argentina’s Kirchner were angry for not being previously advised of the Bolivian decision, which sparked the protests of the international companies operating there.

Chile is trying to keep itself aside of the regional conflicts, but still has to review the long-running conflict with Peru and Bolivia over the Pacific coastline, on of the pending border issues in the continent.

Peru has recalled its ambassador to Venezuela over the meddling of President Hugo Chavez in the Peruvian presidential race. Colombia and Venezuela have little but normal bilateral ties. Problems between Argentina and Uruguay could not be resolved between both brother-nations and the dispute is over the cellulose factories is now in the Hague tribunal.

The Latin American integrationist dream lacks of good health.

Hernan Etchaleco