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Archivos del presente: September 1999, Buenos AiresAuthor(s): Fernando RodrigoSource: Foreign Policy, No. 118 (Spring, 2000), pp. 181-182Published by: Washingtonpost.Newsweek Interactive, LLCStable URL: http://www.jstor.org/stable/1149682 .

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Archivos del presente September 1999 Buenos Aires

Last summer, trade conflicts between Argentina and Brazil almost spelled the end for Mercosur, the common market comprising Argentina, Brazil, Paraguay, and Uruguay (with Chile and Bolivia as associate members). Merco- sur, now almost a decade old, has boosted trade in the region and made Argentina and Brazil attractive candidates for foreign investment. But it has also demonstrated how two regional powers, rivals for most of the century and authoritarian regimes for almost as long, can work together to consolidate democracy and build liberal economies.

Mercosur's crisis-triggered when Brazil drastically devalued its cur- rency in January 1999-provided good intellectual grist for a recent issue of Archivos del presente (Archives of the Present), Argentina's lead- ing journal of international relations.

Felipe de la Baize, a professor of international economics, under- lines the danger posed by economic stagnation in both Argentina and Brazil for the first time in Mercosur's history: Governments have little room to maneuver to appease short-term economic losers in their countries without threatening the long-term economic and political benefits of the common market.

Felix Pefia, under secretary for trade in the Argentine Ministry of For- eign Affairs and one of the architects of Mercosur, explains two major shortcomings of integration efforts thus far. First, he argues, member states need to go much further in coordinating their macroeconomic

SPRING 2000 181

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Global Newsstand

policies and dismantling any remaining trade barriers. Second, the Brazilian crisis revealed Mercosur's inadequate institutional framework, which is too rigid to accommodate major discrepancies, such as sudden exchange rate fluctuations, between member countries.

Some of the issue's contributors argue the crisis may provide the impetus needed to push integration further. For instance, Marcos Azambuja, Brazil's ambassador to France and former ambassador to Argentina, believes the crisis provides a perfect opportunity to begin moving toward a common currency for Mercosur members. Not only would doing so provide economic gains, he argues, the project would also help Mercosur members shake off the stagnation evident after 10 years of integration, just as the euro did for the European Union.

Latin America cannot afford to lose Mercosur. The last 10 years have shown that it behooves Latin America's new democracies to cooperate with their regional partners. Working together, emerging democracies can break away from the disastrous economic policies they inherited, overcome traditional domestic opposition to change, and enable their economies to compete in the global market, attracting for- eign investment and winning negotiating power in world politics- clout that most Latin American countries need desperately.

Last December, the presidents of the four Mercosur countries met in Mon- tevideo, Uruguay, and reaffirmed their commitment to the trade pact. Nev- ertheless, the future of Mercosur will remain uncertain for some time to come. This issue of Archivos del presente will no doubt be a key reference for anyone who hopes to understand Mercosur in the months and, hopefully, years ahead.

-Fernando Rodrigo Professor of International Relations Universidad Aut6noma de Madrid

Goiko Forum November 1999, Tokyo

Japan's tortuous debate over how best to define and advance its national security continues to evolve. One sign of progress: a special issue of Gaiko Forum (Forum on Foreign Affairs) titled "Security in the 21st Century and Japanese Foreign Policy at a Crossroads." The late

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