Latin America is No Joke: U.S. Neighbor Relations
by Stanley A. Weiss

WASHINGTON - When 11 Latin American countries took the first steps toward a regional common market in 1960, dismissive U.S. officials predictably joked that the ill-fated Latin American Free Trade Agreement would generate "more tears than Lafta."

But no one was laughing this month in Peru when all 12 South American nations pledged themselves to an EU-style political and economic community. The South American Community of Nations - which by definition excludes Mexico, the United States and Canada - envisions a common market, a regional constitution and Parliament.

Are America's southern neighbors finally on the path to lasting integration?

Recent decades have seen an alphabet soup of acronymic trade agreements designed to bind the region, from LAFTA to NAFTA (North American Free Trade Agreement) to CAFTA (the Central American Free Trade Agreement, awaiting ratification) to AFTA (the Andean Free Trade Agreement, under negotiation) to SAFTA (a South American Free Trade Agreement, still a dream).

The infighting at the recent economic summit in Brazil underscores the rivalries that have plagued the Mercosur customs union between Brazil, Argentina, Uruguay and Paraguay.

Negotiations to create a hemisphere-wide Free Trade Area of the Americas (FTAA) stretching from Alaska to Argentina are stalled over disagreements between the U.S. and Brazil.

More likely, the display of unity in Peru was as much about South America as it was about the North - specifically the United States. A more unified group of South American nations is seen as a way to strengthen their collective bargaining power in trade negotiations with the almighty yanquis.

Meanwhile, American policy toward the region is "old fashioned and murky," says Rubens Barbosa, a former Brazilian ambassador to Washington. "The U.S. has not recognized the changes in the region after Nafta. There is a new economic geography in the Americas."

Indeed, always bound more by geography than ideology, America and its Latin neighbors are drifting apart. As Washington moves to the right, the rest of the hemisphere is moving to the left. The presidents of Brazil, Argentina, Chile, Venezuela and Ecuador were all elected by challenging Washington-driven free market reforms that have done little to reduce the region's endemic poverty.

This spring, Uruguayans will swear in their first leftist president ever. In Nicaragua, mayoral wins by the Sandinistas may herald the return of U.S. nemesis Daniel Ortega. In Mexico, leftist Mayor Andrés Manuel López Obrador of Mexico City remains the man to beat for president in 2006.

In another sign of the changes, Mexico and Chile, with temporary seats on the UN Security Council, resisted intense American pressure to support the invasion of Iraq.

While in Canada recently, President Bush said that, "a new term in office is an important opportunity to reach out to friends." How can the United States reverse what Barbosa calls Washington's "policy of benign neglect" toward Latin America?

Washington can reach out to its southern friends by focusing more on Latin American concerns. After the recent Asian-Pacific Economic Cooperation summit in Santiago, Bush's only stop in the region was a four-hour drop-by in Colombia to show support for President Álvaro Uribe's war on narco-terrorism.

In contrast, President Hu Jintao of China spent two weeks traveling the region signing $30 billion in trade and development deals with Brazil, Argentina, Chile and Cuba. Last year, China became Brazil's second-largest trading partner behind the United States.

"The U.S. war is against terrorism," Barbosa says, "Latin America's war is against poverty and hunger."

Washington must acknowledge continent-sized Brazil, with South America's largest economy, as the awakening giant it is. In addition to championing the new South American community, President Luiz Inácio Lula da Silva of Brazil has won praise across the developing world for fighting U.S. cotton subsidies, which the World Trade Organization has ruled illegal. Brazil's refusal to fully open its markets without corresponding U.S. concessions on farm subsidies has so far killed dreams of a hemispheric trade pact.

Regrettably, some in Washington view Brasilia as a strategic competitor. Having once warned that Brazil's only trading partner would be Antarctica if it did not agree to a hemispheric trade zone, U.S. Trade Representative Robert Zoellick last year labeled Brazil a "can't do, won't do" country.

Washington should instead welcome Brazil as a strategic partner. Brazil is leading the UN peacekeeping mission in Haiti, has been a valued ally in the drug war and can serve as a diplomatic bridge between the United States and regional bad boy Hugo Chávez of Venezuela. Washington should support Brazil's candidacy for a permanent seat on an enlarged Security Council. And if they really want a hemispheric free trade agreement, Bush and Congress must take on the powerful farm lobby and end unfair agricultural subsidies that make a mockery of free trade.

Washington can no longer afford to neglect Latin American countries like unwanted stepchildren. The United States needs the region - and not just for professional baseball stars. Limited initiatives like free trade agreements with Chile, Central America and the Andean countries are positive steps, but pale beside the huge benefits of a hemisphere-wide pact.

The smuggling of drugs and illegal aliens, narco-terrorism, and responding to crises in places like Haiti are hemispheric challenges. As Secretary of Defense Donald Rumsfeld observed while meeting with his regional counterparts in Ecuador last month, "no one country can deal with these problems alone."

It's in Washington's interest to treat its southern neighbors as the indispensable partners they are. Otherwise, it will be Latin America that has the last laugh.