EU Foreign Policy Towards Latin America

R. Dominguez

• Publisher: Palgrave Macmillan
• Year: 2015
• ISBN:
  9781137321282
• Topic: Politica e relazioni internazionali
• Subtopic: Relazioni internazionali

This book analyzes the relations between two geographical areas with different levels of regional institutionalization: the European Union and Latin America. Characterized by low interdependence and asymmetry, this relationship operates in different levels ranging from EU-individual countries to EU-Latin American summits.

1

EU–Latin American Interregionalism

The European Union and Latin America walked into the twenty-first century through different doors. In Europe, the 2004 and 2007 enlargements transformed the composition of the European Union, the Treaty of Lisbon sparked a turbulent debate about the scope of the integration process, and the prolonged economic crisis forced painful structural transformations in the Eurozone. In Latin America, the benefits of the democratic reforms and the free market policies raised the expectations of the population, producing a spectrum of decision makers ranging from socialists of the twenty-first century to devoted neoliberals. In the light of the historical moment that both regions are experiencing, this chapter aims to explore the feasibility of a fruitful interregional dialogue between Europe and Latin America. To provide some elements of analysis, this chapter reviews the main concepts surrounding the processes of regionalism and integration, examines the moment of regionalism in Europe and Latin America, and studies the analytical framework for the study of the interregionalism between the two.

1.1 Regionalism and integration

Regionalism and integration are essential concepts to explain the background of the EU–Latin American relationship. Regionalization is a process that has been taking place in both regions since the late 1950s, producing two different regional political entities with different levels of institutionalization. Integration, on the other hand, is a significant process because it has allowed the European Union to develop a presence, and actorness, to some extent unique, as an international player.

The broad timespan of this book focuses on the transatlantic events taking place after the end of the Cold War. The selection of this historical period is based on the development of a more institutionalized relationship between the European Union and Latin America, which in turn is derived from the transformations of international society after the disappearance of the pressures of the bipolar system led by the United States and the Soviet Union. Since the fall of the Berlin Wall on 9 November 1989, the European 9/11, and the subsequent disintegration of the Soviet Union in December 1991, international society has experienced dramatic transformations. Four emblematic processes have marked the timeline of the past two decades: the spread of free market policies and electoral democracy during the 1990s, the prioritization in the international agenda of combating terrorism as a result of the American 9/11, the deepening of economic multi-polarity derived from the 2008 global recession, and the prominent role of China in the world economy. While these events have pushed the international agenda in different directions, the process of globalization has remained in the background.

The debate on globalization has produced extensive literature echoing a variety of disagreements on its longevity, causality, and effects. Based on the theoretical perspective adopted by the observer, the explanations of globalization can be associated with the end of the Cold War in the 1990s or the first encounter of Christopher Columbus with Latin America and the Caribbean in the fifteenth century. From a comprehensive perspective, Thomas Friedman (2005) describes the development of globalization in three different stages throughout history. The first lasted from 1492 to the 1800s and the main actors were the nation-states with Imperial ambitions seeking to enhance power and to control resources; the second stage began in the 1900s and ended around the end of the twentieth century, and was spearheaded by multinational companies competing for markets, labour, and resources. The third and current stage of globalization began around the year 2000 and is built around the empowerment of individuals initially through access to technology. Not only has the longevity of globalization been widely controversial, so has its definition. Globalization has become an umbrella term, covering a wide variety of linkages between countries that extend beyond economic interdependence. Among the numerous definitions of globalization, there is a trend to associate globalization with the ‘widening, deepening and speeding up of worldwide interconnectedness’ (McGrew 2010: 16) as well as with the ‘shrinkage of distance on a world scale through the emergence and thickening of networks and connections’ (Keohane 2000: 1).

Regions, the focus of the analysis of this book, react and participate in different ways in the globalization process and work as a transformational layer in the dichotomy between state and globalization. Michael Niemann has accurately assessed the damage of such a dichotomy by saying that ‘the state-global dichotomy lead[s] us to ignore regionalism or analyze it from a state-centered perspective and thereby relegate it to a secondary position in the larger theoretical effort’ (Niemann 2000: 4). Turning the attention to regions brings about two questions: what should one understand by region and how have regions evolved over time?

The concept of regions was traditionally understood as a way to designate a ‘natural’ physical division of the land to differentiate an individual unit distinct from those of neighbouring areas. However, a geographical definition of region has fallen short of explaining the articulation of interests in formal (regional organizations) and informal (interdependence) institutions beyond the state borders. Such articulations vary from region to region; hence, the conceptualization of region is flexible since there are no fixed criteria to define it. In that view, regions are ‘ambiguously forming part of, but also reacting against and modifying the process of globalization’ (Hettne 2000: xxi) and ‘Regions are always evolving and changing. Like a nation, a region is an “imagined community” ’ (Hettne 2002a: 327). Thus, regions are territorial subsystems of the international system and have many varieties of regional subsystems with different levels of ‘regionness’, namely, ‘the position of a particular region or regional system in terms of regional coherence and identity, which can be seen as long-term endogenous historical processes switching between coercion (earlier history) and voluntary cooperation’ (Hettne 2000: xv). In this sense, regions are created and recreated by their constituent units and have evolved since the mid-1950s in three different forms: old, open, and new.

The old regionalism was conceived in the context of the bipolar world, was institution/government driven, and pursued an inwardly oriented strategy based on a model of import-substitution. The Latin American integration in the 1960s and 1970s is representative of this kind of regionalism (Bhalla and Bhalla 1997). Conversely, open regionalism was designed to be compatible with globalization; it aimed to encourage global competition, investment, and growth, and was associated with the outward-looking export-oriented economies of East Asia and the Pacific: the Asia-Pacific Economic Cooperation (APEC) and Association of Southeast Asian Nations (ASEAN), which, unlike the North American Free Trade Agreement (NAFTA) and the European Union, are not formally grouped into any regional bloc (Bhalla and Bhalla 1997). This new regionalism has been defined as a multidimensional form of integration, which includes economic, political, social, and cultural facets and consequently ‘goes far beyond the goal of creating regional free trade agreements or security alliances’ (Hettne 2000: xvi).

The three waves of regionalization have shaped the regions of the globe in different ways. Almost all regions have experienced some form of regionalism (policies and projects whereby state and non-state actors cooperate and coordinate strategies within a particular region) and most of them also partake in some form of regionalization (process of cooperation, integration, cohesion, and identity creating a regional space) (Söderbaum 2009). From the angle of regionalization, the European Union and Latin America are in a permanent process of constructing their own regions, yet the regionalisms in both areas are quite different when one looks at the levels of cooperation, coordination, and institutionalization of strategies within each. In contrast with other regions in the world where regionalism is embraced with weak regional institutions, rhetorical commitments, and vague results, the European Union has developed and implemented policies, instruments, and institutions aimed at pooling sovereignty in a process of not only regionalism but also integration.

A useful definition of economic integration is the ‘progressive removal and ultimate eradication of economic barriers between different states … whose rhythm is determined by economic as well as political bargaining and compromise’ (Rodríguez-Pose 2003: 8–9). Accordingly, based on the traditional stages of Bela Balassa (1961), it would be expected that free trade projects worldwide would progressively move forward towards complete economic integration. The first level is the free trade area, which is the simplest level of integration and allows only for the free movement of goods. This is the case in the European Free Trade Area Association (EFTA) and NAFTA. The second level of integration is the customs union, which is characterized by the harmonization of external tariffs; despite its numerous failures, this is the case of the Southern Common Market (Mercosur). The third level of surrendering economic sovereignty to integration is the common market, which was reached by the EU at the beginning of the 1990s; this level allows free mobility of capital, labour, and services. The fourth level is the harmonization of economic policies and is known as the economic union; to some extent, the experience of the Eurozone embodies this stage of integration. The final stage is the complete economic integration, in which central institutions substitute for national ministries in the policy-making process. Although there is no full-fledged regional experience at this level, some of the monetary functions of the European Central Bank resemble what economic integration would look like.

From a politically comprehensive perspective, Karl Deutsch defined integration as ‘the attainment, within a territory, of a “sense of community” and of institutions and practices strong enough and widespread enough to assure, for a “long” time, dependable expectations of “peaceful change” among its population’ (Deutsch 1957: 5–6). In such reasoning, when a group of people or states has been integrated this way, they constitute a ‘security community’, which is one of the distinctive concepts of European integration. Ernst Haas provided the standard literary definition of European integration as ‘the process whereby political actors in several distinct national settings are persuaded to shift their loyalties, expectations and political activities to a new centre whose institutions possess or demand jurisdiction over the pre-existing national states’ (Haas 1958: 16). Haas’ definition is highly idealistic by most standards and many would argue that it would be difficult to achieve in even the most advanced regional systems of integration. For instance, Etzioni states that the European Commission and Parliament are largely international or regional bodies but not truly supranational ones, and adds that the European Union currently is a ‘halfway integration’ process (Etzioni 2001).

Finn Laursen suggests that collective decision-making is an important aspect of all regional integration efforts, which can be more or less efficient, and the established common institutions, which can be more or less adequate (Laursen 2003). Lynn Marie Tesser’s definition, on the other hand, asserts the following: ‘The general harmonization of policies, procedures, and practices via collective decision-making between entities such as institutions, organizations, and countries that, at the very least, limits the wholesale autonomy of each body’ (Tesser 2003). In sum, while integration may necessitate the centralization of decision-making bodies in the long run, the speed varies in each sector of economic activity within a region, creating multi-speed or variable geometry integration processes.

1.2 The European Union and Latin America

The level of regionalism in a geographical area is a key element in studying interregionalism. The capacity of the member states of a region to reach collective consensuses in international organizations through formal and informal institutions varies from region to region. The relationship between the European Union and Latin America is emblematic of the complexity of interregionalism between regions with distinct levels of regionness. Following the four manifestations of regionalism described by Higgott (2007), while de jure and cognitive regionalism exits in both regions, the main difference lies in the de facto and instrumental regionalism, which to a great extent brings legal and perceptual regionalism into practice. Hence, the European Union has developed institutions and policies allowing it to speak with one voice and to connect regionalism with integration. Conversely, Latin America has not only been unable to develop an encompassing regional institution, but also experiences the fragmentation of de jure and cognitive regionalisms. The contrasts in the integration processes in Latin America and Europe have produced two regions with different capacities to influence the international system.

After more than three decades of institution making in the area of external relations, the European Union has improved its profile in a more consistent fashion. From a realist perspective, the institutions created by the European Union are only a reflection of the willingness of member states to deepen integration. This view, driven by the national interest of the EU members, would explain the EU capacity to transform Europe through the enlargement process or the inability of the European Union to act decisively in regional crises such as in Syria or the Ukraine. From liberal or constructivist perspectives, the European Union is part of the policy-making of the states either by the logic of non-zero-sum game or the transformation of identities. This view acknowledges the value added to the series of institutions created in the EU treaties such as the European External Action Service (EEAS) and the EU diplomatic contributions to brokering the 2013 agreement between Serbia and Kosovo and keeping the ‘P5+1’ together in nuclear non-proliferation talks with Iran (Blockmans 2013). In this regard, beyond the theoretical debates in International Relations, the analysis of the European Union’s actorness is possible as a result of a political system at the European level linking 28 countries.

The European Union is better studied as an illustration of a political system than as an experiment in regional integration or as an international organization as traditionally conceived (Jørgensen and Rosamond 2002). This line of reasoning has produced three general assumptions (Attina 2001). The first is that the European Union – like all national political systems – has a set of formal rules for collective decision-making; the Lisbon Treaty is emblematic not only of the collective decision-making but also of the legal effect of integration. The second is that politics and policy-making at the community, national, and local levels intertwine; and, hence, office-holders, collective political actors (i.e. political parties and private interests groups), and ordinary citizens take part in EU politics to defend interests and uphold ideologies and values. The third assumption is that, despite the small EU budget, the classic concept of politics as the authoritative allocation of values and resources also applies to the European Union. Structural and cohesion funds give the European Union power to redistribute financial resources among disadvantaged regions and areas. In sum, ‘the European Union is a regime of continental magnitude that is very thickly networked horizontally via markets while maintaining relatively weak political regulations vertically through indirectly legitimated authorities’ (Hettne 2002b: 5–6).

These three assumptions are implemented at the intraregional and interregional level. At the intraregional level, the 2008 economic crisis left a deep wound in most of European society, sparked debates on the scope of the economic integration project, and transformed the institutional economic arrangements at the EU level. Resembling the situation of Latin American countries in the 1970s, some European countries have either lost access to normal market financing (like Greece, Ireland, and Portugal), or faced very high-risk bond interests (like Italy and Spain in 2011–2012). Austerity came to the scene as the only acceptable policy option and entailed reducing expenditure to obtain financing from some official body like the International Monetary Fund (IMF) or the European Stability Mechanism (ESM). In January 2012, all European Council members, except the United Kingdom and Czech Republic, endorsed the final version of the Treaty on Stability, Coordination, and Governance in the Economic and Monetary Union. The Treaty, sometimes called the ‘Fiscal Pact’, entered into force in January 2013 but has faced problems in its implementation (Mortensen 2013). European economies simultaneously faced the social cost of austerity to set their economies on track to recover the confidence of its foreign creditors (Gros 2013).

At the interregional level, under the EU umbrella, several arrangements have been created over time in Europe in a complex set of concentric circles (Emerson 2013). The variable geometry within Europe includes the Eurozone and Schengen Area, paving the way for a European integration process moving forward at different speeds in addition to other arrangements such as the method of ...