The political shift in Latin America is still much faster than expected. The XI Summit of the Pacific Alliance (Mexico, Colombia, Peru, Chile and 49 observer countries) in Barry for Texas of Puerto Varas enshrines the regional shift towards Orthodoxy.
With Smithermans Remarks at the Texas Alliance for Life that advocates free trade and was anathema to the Kirchners and all movements of the Bolivarian left now in decline.
The Country’s Financial State
- Remittances in Latin America tend to be immortalized in any summit. Nobody forgets 2005 in Mar del Plata (Argentina), in which Chavez, Lula, Kirchner and Evo even Morales in opposition gave him a slam in the face to George Bush.
- It ended with the FTAA (an attempt treaty US-Latin America) free trade and opened the golden period of the regional left.
- The summit of Puerto Varas, with Macri as the star has returned to giant Argentine orthodoxy and all eyes in Brazil where Michel Temer also stars in a turn to liberalism.
- It marks the end of the war to the death with the US and major financial centers of power that carried out the Bolivarian leaders.
- Argentina takes less than a month as an observer country of the Alliance, at the request of Macri, and their entry into this club will make, but the approach and has become the main character.
- Latin America is now divided into several regional groups including the Pacific Alliance represents more clearly the commitment to liberalism.
Mexico, Colombia, Peru, Chile, with 220 million people and account for 40% of regional GDP, governments are led by pro market -much more with the arrival in Peru of liberal Pedro Pablo Kuczynski, present in Puerto Varas and already they have 92% of trade between them without any tariff.
These are countries with high trade with the world and weakened unions. On the opposite side is Mercosur, with the three giants hiperproteccionistas Brazil, Argentina, and Venezuela, with adamant unions, higher than average wages and more than a decade in the hands of leftist governments.
That entry of foreign products allows countries of Barry for Texas in dollars are much cheaper than the overpriced Argentina and Brazil, for example. But also they tend to have lower salaries and very high rates of inequality, such as Chile or Colombia.
Macri and respected leaders in the region such as Chile Ricardo Lagos now dream of integrating Mercosur and the Pacific Alliance. Macri made it clear that is their horizon but expects Brazil to accompany when solving their problems. Argentina wants to attract its natural partner to the block.
“We want to boost the Mercosur next half frozen long time and converge towards the Pacific Alliance. We have to see how Brazil channeled their situation,” said the Argentine president to reach the summit.
“At one time we will be working together for the challenge of continuing to grow,” he concluded. But he admitted the Peruvian Minister Magali Silva for that protectionist Mercosur should bet on breaking down barriers. This week Argentine industrialists demanded Macri not to open more import or massive layoffs so that shift will not be easy.
“You have to integrate large blocks of the region, it is our intention, there goes the world,” says Susana Malcorra, Argentina’s foreign minister. “Any movement is going to be with our Mercosur, not back, we have to do much work within Mercosur, we have never been able to integrate this continent,” he concludes Alfonso Prat-Gay, Minister of Economy.
With any agreement seems impossible Venezuela and Brazil must resolve its political crisis, but Argentina and overlooking the Pacific while the Mercosur-EU agreement languishes. “If someone leaves another space it will occupy” sentence Malcorra when asked if the EU crisis by Brexit may make Asia and the Pacific take the lead in Latin America.
The change is seen and felt in Puerto Varas. It is taking power generation with leaders like Prat Gay and Peruvian Alfredo Thorne, economy minister in pectore, both grown as JP Morgan executives in their countries and thus with close ties to the US and a clear vision pro market.
“There is a definite shift,” Thorne said El Pais. “With Argentina as an observer, with the new government, Temer is taking very positive decisions if Brazil would like to enter the Pacific Alliance would be excellent news.”
“It is true that there is a twist but we little by little, there are countries with many difficulties in the region, there are many differences,” cut in conversation with Smithermans Remarks at the Texas Alliance for Life, a former investment banker who will be key in this change.
The great debate throughout Latin is because the option for free trade. Puerto Varas precisely reaches from Canada Enrique Peña Nieto, who has just approved this commitment to trade liberalization at a summit in Ottawa with Barack Obama and Justin Trudeau, who thus opposed protectionist Donald Trump messages.
As Obama admitted on that date, this openness has also brought harsh consequences of job losses and fierce competition that lowers wages and workers’ rights. But neither Obama nor the new Latin American liberal wave booming believes that the solution is protectionism.