MercoPress. South Atlantic News Agency

Bachelet: joining Mercosur would be “back stepping”

The recently inaugurated Chilean president Michelle Bachelet said that for Chile to become a full member of Mercosur would mean “back stepping”.

"That's why we are so enthusiastic and push so hard for a Free Trade Association of the Americas, FTAA", added Ms Bachelet in a long weekend interview with Buenos Aires daily La Nación.

"The difficulty has always been that Chile has economic reforms in place. Becoming a full member of Mercosur would mean back stepping on those reforms", she underlined.

"What is needed is a basic FTAA, in which minimum conditions are equivalent for all countries, and from there on keep advancing. An FTAA of this kind would enable all countries to join. That's why we are enthusiastic and push hard for TFAA", added the Chilean president.

Mercosur, basically a customs union launched in 1991 fifteen years ago this Monday March 27, experienced an encouraging advance during the first few years and rapidly became a reference for the region.

However, problems began to emerge with the so called asymmetries, (different degrees of development of the members' economies) and more serious, Mercosur lack of capacity to address and overcome those challenges.

Meantime Washington in the mid nineties launched the idea of a free trade association, on the lines of the North American Free Trade Association, Nafta, extending from Alaska to Tierra del Fuego.

But some South American countries fearing greater US influence and penetration, and Washington's reluctance to eliminate farm aid and subsidies have stalled discussions and encouraged suspicions.

Ms Bachelet also highlighted that Mercosur members must urgently find a way out to the current situation otherwise "some people might begin to question the merits of the agreements which are not honoured or simply ignored". "Chile can't stop advancing and Mercosur can't be restricted to a tariffs controversy, we would like to see Mercosur in a wider context", indicated President Bachelet.

But in spite of the differences analysts believe the Chilean president is committed to regional integration.

"It's too premature to forecast the Bachelet administration's emphasis, but she does want closer links with the region, but not with the restrictions Mercosur imposes. However this does not mean there are other ways of advancing integration", said economist Patricio Mujica.

"In Chile we're very satisfied with economic policies and the trade agreements achieved, for example the free trade accord with United States or with the European Union", he added.

But Ms Bachelet attitude is quite pragmatic in spite of Monday's non celebration of the Mercosur anniversary and the different approach with Argentina regarding the FTAA.

"We are strategic allies of Argentina for thousands of reasons. But as in any political coalition or even inside a family, there can be differences. But with respect and trust you can address all issues no matter how delicate they can be".