1. MERCOSUR/L AND REGIONAL DEVELOPMENTS IN LATIN AMERICA

2. INTRODUCTION Will look at Mercosur/l as an organisation
SA relations with Mercosur/l
SA bilateral relations Argentina, Brazil
Current trends in Latin America generally

3. MERCOSUR/L
Spanish/Portuguese acronym for Common Market of Countries of the South
Members: Argentina, Brazil, Paraguay, Uruguay (Venezuela completing formalities)
Associate members: Chile, Bolivia, Peru, Mexico
Secretariat in Montevideo, Uruguay

4. MERCOSUR: BACKGROUND Treaty of Asuncion, 1991:
Economic considerations, but also
Political considerations:
Drive for regional cohesion
Regional Parliament, May 2007

5. MERCOSUR: BACKGROUND
Need for regional cohesion expressed in formation of several multilateral bodies, eg:
Latin America Parliament (1964)
Andean Parliament (1969)
Central American Parliament (1987)
Indigenous Parliament of the Americas (1987)
Amazonian Parliament (1989)

6. SA and MERCOSUR SA’s western neighbours Similar colonial background
Political like-mindedness (Progressive governance)
Natural partners South-South cooperation
Competitors in some areas (traditional markets, commodities) but
Room for bilateral trade, investment
Allies in South context (eg UN, Bretton Woods revamp)

7. SA and MERCOSUR
MERCOSUR members significant players bilaterally and multilaterally
as a group (size, numbers, production share)
Individually (Brazil’s President Lula and Africa; Uruguay commitment to Africa – MONUC; Argentina’s size, potential, BNC)

8. MERCOSUR: TOWARDS A TRADE AGREEMENT
President Mandela’s address at Mercosul Summit, Florianopolis, December 2000
Minister Erwin signed Declaration of Intent towards an FTA
Several rounds of negotiations: PTA first
Next round Pretoria 8-9 October 2007

9. MERCOSUR: INTERNAL
Imbalances larger, smaller economies (Argentina, Brazil cf Uruguay, Paraguay)
Tensions
Possible new proposals

10. ARGENTINA Political developments Economic developments
President Nestor Kirchner May 2003
Elections: Senator Cristina Kirchner?
Economic developments
GDP US$180 bn (2005), US$211bn (2006)
Reduction of foreign debt

11. SA-ARGENTINA BNC February 2007 11 Agreements concluded, 2 underway
Trade balance almost 5:1 Argentina’s favour
Trade study by SA Embassy
SA trade and investments: Anglo Gold; Standard Bank; Sappi; Irvin and Johnson; Naspers

12. SA-ARGENTINA Multilateral African Agenda Similar policies, objectives:
Development agenda of South
Centrality multilateralism and UN system
Reform global economic governance, trading system
African Agenda
Argentina supportive

13. BRAZIL Political developments Economic developments
President Lula re-elected (last term, to 2010)
Survived several political scandals
Governing coalition controls 70% seats parliament
Economic developments
Actual GDP 2006: US$1 067 bn
January 2007: Accelerated Growth Plan

14. SA-BRAZIL Political relations Economic relations
Strategic partner (Presidents meet regularly)
Trilateral, bilateral, multilateral
Common challenges: income disparity, poverty eradication
Bilateral agreements, visits; Joint Commission
Economic relations
Total trade 2006: US$1,894bn (surplus Brazil)
Trade missions DTI; trade survey SA Embassy

15. SA-MERCOSUR/L Conclusion: Common goals, experiences
Strong partners South-South
Challenges:
trade imbalances
Conclusion SACU-MERCOSUR/L FTA/PTA