Latin America needs greater economic integration and a merger of Mercosur and the Pacific Alliance should be the objective, according to Argentine president Mauricio Macri, who insists in loosening trade restrictions in his country and the region.
First, we have to boost Mercosur, Macri said in an interview with the Japanese agency Nikkei, suggesting he was ready to take the lead in breaking down tariffs and other barriers to trade within the bloc.
Mercosur members cannot unilaterally sign free trade agreements with outside countries unless there's a full consensus on the issue. Nevertheless Macri said Mercosur is ready for negotiation with Japan.
Attempts to build broad economic zones in the region are nothing new. The proposed 34-nation Free Trade Area of the Americas was to span North and South America and the Caribbean, excluding Cuba, and produce a functioning bloc by the end of 2005. But the effort foundered amid resistance by then-Venezuelan leader Hugo Chavez and other opponents, including Nestor Kirchner and Lula da Silva.
After that failure, free trade proponents Mexico, Chile, Peru and Colombia formed the Pacific Alliance. The bloc seeks closer ties with Asia, having given observer status to Japan, China, South Korea, India and other nations on the continent.
Argentina became one of the 49 observer countries to the Pacific Alliance in June, with Macri's government apparently trying to show that his country is open for business.
Macri described observer status as the first step toward market integration. Together, the two blocs would have a combined gross domestic product of roughly US$4.5 trillion, about the size of Japan's GDP, creating a more powerful magnet for investment.