Latin America’s New Regional Architecture: Segmented Regionalism or Cooperative Regional Governance?

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Latin America’s New Regional Architecture: Segmented Regionalism or Cooperative Regional Governance?

Detlef Nolte

[email protected]

Paper presented at the XXXI International Congress of the Latin American Studies Association (LASA)

Washington D.C., May 29 – June 1, 2013

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Summary

This paper has two main objectives. First, in the context of a rising importance of

regions in world politics, it will analyze the current regional architecture in Latin

America – which is characterized by a proliferation of partially overlapping regional

and subregional organizations – and confront opposite views of this process. Some

authors postulate an exhaustion of integration in Latin America ending up in

segmented regionalism and hemispheric disintegration. Others stress a variable

geometry of integration that facilitates intraregional cooperation and minimizes the

risk of veto-players and zero-sum politics. This paper argues that the proliferation of

regional organizations leads to “institutional elasticity” and gives Latin American

governments more freedom of choice with regard to the topics, issues and modes of

regional and subregional cooperation, leading to a differentiated regional governance

architecture. This is illustrated by a summary look on regional trade and security

cooperation.

Second, this article argues in favor of an analytical approach that takes into account

the visions of actors reflected in regional projects. (Region is what actors make of it.)

The pitfalls of analyzing the Latin American regional architecture with a narrow

Eurocentric integration approach will be discussed. The proposal here is to broaden

the analytical focus and replace the analytical concept of regional integration with the

analytical concept of regional governance. Regional governance more adequately

captures and integrates different patterns of regional cooperation and different

regional projects that result in overlapping regional organizations. It also better

reflects the self-declared objectives and interests of Latin American governments.

Instead of looking at the proliferation of regional organizations from a perspective of

fragmentation, this paper contends that the focus should be redirected to

understanding how different regional organizations interact. The interaction patterns

can vary from symbiotic to cooperative or competitive regional governance. This

article closes with a brief discussion of the repercussions of the new regional

architecture for the inter-regional relations between Latin America and the EU.

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1. Regions, Regional Organizations and Regional Powers

Regions and regionalism have become an important feature of world politics in a

multipolar international system where the West is only one region of a “decentred

globalism” constituted of several regional cores and where emerging states seek to

influence the norms of global governance (Buzan 2011; Fawcett 2013: 12). In this

context, it becomes more important to understand how regions are politically

organized and governed.

While regions are porous social entities (Katzenstein 2005) open to external influence

through processes of norm diffusion or through the foreign policies of great powers,

local actors can use regional organizations to create rules with a view to protecting

their autonomy from dominance or abuse by more powerful actors (Acharya 2011).

Regional organizations can make a region less porous in regard to the international

system by functioning as filters between the region and the international system

(including global governance structures).

The creation of regional organizations constitutes and consolidates a region

inasmuch as they give the region an identity (or “actorness”) as a social construct. As

former Brazilian foreign minister Celso Amorim (2010: 229–230) once claimed,

“Unasul [UNASUR] has given South America a face.” 1 Moreover, regional

organizations delimit the region as a subsystem within the international system and

serve to structure the relations between states within the region. From this

perspective, there are two addressees of regional organizations. Regional

organizations deal with the management of regional externalities (that could be

related to trade, security or other topics) and/or with the articulation of common

interests of the region with regard to actors outside of the region. Regional

organizations, at the same time, separate the region as a subsystem from the

international system and structure the relations between states within the region. The

same institutions can be used as instruments of regional cooperation and as

1 This identity-constructing function of regional organizations is well expressed in the UNASUR treaty: “Member states will reinforce the practice of constructing consensus with regard to the central topics of the international agenda and promote initiatives that affirm the identity of the region as a dynamic factor in international relations” (UNASUR Treaty Art 14; author’s translation).

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instruments of discrimination and exclusion against other states. This outside-inside

dimension is often neglected when the topic of regional organizations is discussed

from a narrow regional integration perspective.

Since the beginning of the second decade of the 21st century, most world regions

(and subregions) have been characterized by a dense network of partially

overlapping regional organizations. These regional organizations comply with

different functions and interests, and they can be multidimensional. They may

respond both to common interests or fears and to divergent interests or fears.

Regional governance organizations can be demand driven or supply driven. In the

first case, they respond to a common challenge; in the second case, they are created

by governments – as part of a regional project (Tussie 2009) – to promote their

interests within a geographical region by means of these organizations. It is a

“product” that they offer on the political market to realize a profit (with regard to their

political objectives). However, to be successful in this regard they must convince

clients (that is, other states in the region) that this product is useful to them. To put

their regional projects into practice, regional leaders thus need regional followers.

From an analytical perspective, regional organizations feature three dimensions: a

functional dimension that, as a response to regional interconnectedness, responds to

a demand for the regulation of transborder externalities; a power dimension that, as

an instrument of domination by a regional power or as an instrument used by minor

powers, constrains a dominant power by means of regional rules and institutions; and

an ideational and normative-institutional dimension that constructs and gives material

substance to the region. In practice, these dimensions overlap (Nolte 2011).

Most regions feature more than one regional organization. Often, these organizations

are complementary and comply with different functions. Some organizations are

suborganizations of other or broader regional organizations. However, regional

organizations can also overlap (for Africa see De Lombaerde 2011: 37; Genna/De

Lombaerde 2010: 591–592)2 with regard to mandate and membership (see Weiffen

et al. 2012). So one may ask what the reasons and consequences are of the

proliferation and overlapping of regional organizations. Adler and Greve (2009: 73–

2 To speak of “overlapping regions” (Genna/De Lombaerde 2010: 591–592) should be qualified based on whether competing regional organizations really construct different regions.

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75) attribute the “temporal/evolutionary overlap” of regional organizations (in their

case, regional security organizations) primarily to history and the survival of

institutions created in the past. 3 There is also an alternative, or at least

complementary, explanation. Regional organizations survive or are newly created

because they serve the conflicting interests of different state actors. Regional powers

(see Nolte 2010; 2011) and their regional projects are important drivers behind the

creation of new regional (intergovernmental) organizations,4 which can compete for

members and mandates (with regard to UNASUR and OAS see Nolte/Wehner 2013).

The “‘balance of practice’ within regions may be as important as balance of (material)

power, or balance of interests” (Adler and Greve 2009: 82).

Generally, the topic of overlapping and competing regional organizations has still not

been sufficiently analysed. What are the consequences for regional cooperation and

integration? How can the evolving regional architecture be conceptualized? Using

these questions as a starting point, we confront the opposing views of the current

state of regional cooperation and integration in Latin America (especially South

America). This paper supports the view that the proliferation of regional organizations

can present national governments with more choice and diminish the risks of

stagnation with regard to processes of regional integration. This argument will be

illustrated with examples from trade and security politics.

3 “Change in (international) politics, even when discontinuous, is a process through which the past and the future intersect. Thus, one set of institutions, mechanisms, norms or ideas does not fully replace another in an instant; rather, they coexist. Old practices and mechanisms may still have not fully replaced another in an instant, rather they coexist” (Adler and Graf 2009: 73). 4 Nolte (2010: 893) defines regional power “as a state which articulates the pretension (self-conception) of a leading position in a region that is geographically, economically and political-ideationally delimited; which displays the material (military, economic, demographic), organizational (political) and ideological resources for regional power projection; which truly has great influence in regional affairs (activities and results). In addition, it is expected that a regional power is a state which is economically, politically and culturally interconnected with the region; which influences in a significant way the geopolitical delimitation and the political-ideational construction of the region; which exerts this influence by means of regional governance structures; which defines and articulates a common regional identity or project; which provides a collective good for the region or participates in a significant way in the provision of such a collective good; which defines the regional security agenda in a significant way; whose leading position in the region is recognised or at least respected by other states inside and outside of the region, especially by other regional powers; which is integrated in interregional and global forums and institutions where it articulates not only its own interests but acts as well, at least in a rudimentary way, as a representative of regional interests.”

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2. The Proliferation of Regional Organizations in Latin America

There have been two waves of regionalism in the post–World War II period

(Mansfield/Milner 1999; Goltermann et al 2012). The second one started in the 1990s,

which, in Latin America, is reflected in the proliferation of regional and subregional

organizations. In 1990, for instance, there were 7 major multi-issue regional and

subregional organizations in Latin America and the Caribbean; this number increased

to 13 in 2012 (Börzel 2013: 509; Goltermann et al 2012: 12–13).5 The newcomers

are the Association of Caribbean States (1994), Mercosur (1991), ALBA (2004),

UNASUR (2008), CELAC (2010) and the Pacific Alliance (2012). Other regional

organizations such as the Andean Pact and the Common Central American Market

have changed their names and/or their objectives.

Although there is consensus that there has been a proliferation of regional and

subregional organizations in Latin America in the last two decades – where “regional

relations have turned into a complex, multilayered arena, where social forces,

regional powers and contending political projects compete” (Tussie 2009: 188) –

there is less consensus with regard to the consequences of this proliferation of

regional organizations and the characterization of the current regional architecture.

The classification of this architecture has varied between third wave (post-neoliberal)

regionalism (Riggirozzi 2012: 18), post-liberal regionalism (Sanahuja 2010; 2012a),

post-hegemonic regionalism (Riggirozzi 2011), heterodox regionalism (Van Klaveren

2012: 137), post-trade integration (Riggirozzi/Tussie 2012: 9f.) to segmented

regionalism, decentralized subregionalisms and hemispheric disintegration (Malamud

and Gardini 2012) or “regionalism light” (Sanahuja 2010).

5 There are more regional organizations in Latin America and the Western Hemisphere. A study lists 31 still-active formal international governmental organizations. This study does not include ALBA, UNASUR, CELAC or the Pacific Alliance, but differentiates between inter-American, Latin American and subregional organizations (Jefferson 2007). Another study counts 25 (Scheman 2007: 32–33) component institutions of the Inter-American System – differentiating between various areas: overarching cooperation, political cooperation, development, finance, regulatory and advisory cooperation, trade and economic integration.

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While it seems clear what “old regionalism” denotes and what the “new regionalism”6

or “open regionalism” of the 1990s in Latin America means, it is less clear what kind

of regionalism predominates today. On the one hand, old regionalism is linked to

post-war US-led regional security organizations (like the OAS in Latin America); on

the other, in Latin America it is associated with import substitution industrialization

strategies on a regional scale bolstered by high external tariffs and regulated markets

(Sanahuja 2012). In contrast, the “new regionalism” of the 1980s and 1990s in Latin

America resulted in more independent regional organization with regard to the US

(such as the Rio-Group and a more autonomous role of the OAS) and in the

development of a more autochthonous regional security agenda after the end of the

East-West conflict. New regionalism was linked to the idea of an “open regionalism”

in the economic realm, which aimed to promote market scale and efficiency through

global and regional trade liberalization (IADB 2011: 6) with much lower external tariffs

than in old regionalism. Ultimately, the idea was to win time to realize the objective of

successful integration into the global economy. Although open regionalism sought to

protect the region against some of the risks related to the processes of globalization,

it also promoted – as Sanahuja (2010: 89) has correctly stated – globalization by

supporting intraregional trade liberalization and a neoliberal economic policy. Open

regionalism was perceived as a building block toward global liberalization (Riggirozzi

2012: 32).

Generally speaking, there are three approaches to analyzing or describing the

changing regional architecture in Latin America: The first approach is open ended

and focuses on new and hybrid practices in a “period of transition” (Sanahuja 2010).

From this perspective, it is still not clear how the regional architecture will evolve and

what the emergence of a mixed pattern of overlapping regional organizations and

projects will imply. The second approach is more critical and emphasizes the risk of

regional disintegration and questions whether regional integration has ever been in

Latin America. The third approach stresses the positive potential of a plurality of

overlapping regional organizations.

The first approach is best represented by Diana Tussie and Pia Riggirozzi. Tussie

(2009: 185-186) stated that “the trend may be not towards amalgamation or a single

converged regional bloc, but towards greater diversity of hybrids with mutually fuzzy 6 Sbragia (2008: 30) mentions the variations in the use of the concept and the different theoretical approaches linked to “new regionalism” (see also Söderbaum/Sbragia 2010).

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boundaries, arranging component pieces in ever new combinations underpinned by

increasingly intense regional relations.” Later, Riggirozzi and Tussie (2012: 10)

argued that “regional governance is currently the result of a mosaic where different

regional policies, regional identities and regional forms of cooperation and

competition are transforming the cartography itself.” Riggirozzi and Tussie (2012: 11)

identify three main projects: (1) projects with a strong emphasis on commercial

integration (NAFTA, Pacific Alliance), (2) hybrid projects combining trade (sometimes

with new elements) and political post-trade objectives (UNASUR, Central American

Common Market, Mercosur, CAN), and (3) a project that emphasizes political and

social aspects of integration, reclaiming principles of socialism (ALBA).

It is important to stress the dynamic character of regionalism and the corresponding

regional architecture in Latin America. As Riggirozzi (2011: 20) remarks, older

regional organizations and projects do not necessarily disappear. There is no

process of substitution, but one of overlapping of older and newer organizations.

Different regional organizations may compete and change over time with regard to

their function and importance. This explains a growing interest in the analysis of

hybrid forms of regional integration (Tussie 2009; Riggirozzi/Tussie 2012) and of the

overlapping of regional organizations with regard to mandates, membership and

practices (Adler/Greve 2009; Weiffen/Wehner/Nolte 2012).

Contrary to Riggirozzi and Tussie (2012) generally positive view of current trends,

Malamud and Gardini (2012) have a more critical view of the proliferation of regional

organizations. They state that “the presence of segmented and overlapping

regionalist projects is not a manifestation of successful integration but, on the

contrary, it signals the exhaustion of its potential” (Malamud and Gardini 2012: 117).

In their view, the proliferation of regional organizations in Latin America will result in

decentralized subregionalisms and hemispheric disintegration. Moreover, the multiple

membership in different (sub)regional organizations will create friction between and

within regional integration projects and will fuel divisions instead of unity in the region.

While Malamud and Gardini (2012) focus on the risks, there might also be positive

aspects related to the proliferation and overlapping of regional organizations. From a

more general perspective based on European experiences, Hofmann and Mérand

(2012) argue in favor of differentiated multilateral cooperation and “institutional

elasticity,” which can foster peaceful and stable interstate relations within a region

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and minimize the risk of zero-sum politics. In their view, “outright bargaining failures

become less likely as member states have the flexibility to opt out of certain

institutionalized policy domains or they can push for their preferred policy preferences

in another institution.” It reduces the possibility regional integration stagnating

because actors can switch between arenas and there are more points from where

new initiatives can be launched. The authors refer to a European-type “variable

geometry,” where no state “feels forced to belong to the entire club, and hence is

more willing to invest in the policy areas that are close to its interest”

(Hofmann/Mérand 2012: 137). Sanahuja (2010: 110) emphasizes that the

constitutive treaty of UNASUR (see Art. 13) explicitly opens the possibility of a

variable geometry–styled architecture in South America.7

Hofmann and Mérand (2012) also criticize the tendency to look at regional

organizations in isolation, “thus neglecting the specific properties of an institutional

architecture (i.e., how different regional organizations are assembled together) and

the impact that these properties have on regional order.” In the end, the whole (i.e.,

the combination and interaction of different regional organizations in Latin America)

may be greater than the sum of its parts (i.e., analyzing regional organizations

separately). The focus on one isolated regional organization – for example,

MERCOSUR – might lead to inaccurate conclusions about the state of regional

integration. Therefore, it makes better sense to discuss the whole regional

architecture rather than to focus on separate regional organizations.

3. Menu à la Carte and Differentiated Multilateral Cooperation in Latin

America

Today, Latin America offers a broad spectrum of regional organizations that embrace

different issue areas, reflect different types of integration and cooperation, and

7Article 13 stipulates that “one or more Member States may submit to the consideration of the Council of Delegates a proposal for the adoption of policies, creation of common institutions, organisations and programmes to be adopted in an agreed manner, on the basis of flexible, gradual criteria of implementation in line with the objectives of UNASUR […]. Programmes, institutions and organisations in which Member States participate prior to the entry into force of this Treaty may be considered as UNASUR programmes, institutions or organisations […]. Any Member State may fully or partially exempt itself from implementing an approved policy, for a set time or indefinitely, without this preventing said State from subsequently incorporating the policy, either fully or partially.”

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represent different political ideological projects. In this context, each Latin American

country can choose the mix of regional organizations or cooperation structures that

best fits its interests.

It would appear that likeminded Latin American states join each other to foster their

common interests. Taking the issue of free trade and open markets as an example, it

is possible to differentiate between the interests of the countries of the Pacific

Alliance, the Mercosur members and the ALBA members. The countries that form

part of these groupings have different average tariffs, different numbers of free trade

agreement partners, and a different volume or percentage of trade concentrated in

these partner countries.

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Source: IADB 2012b

Source: IADB 2012b

When we look at security, the regional cooperation patterns are different. There is the

OAS, an overarching Western Hemispheric organization (which includes the US and

Canada) that is in competition with UNASUR and the South American Defense

Council (see Nolte/Wehner 2013) with regard to conflict resolution and security

cooperation. While three Pacific Alliance countries (Chile, Colombia and Peru) are

part of UNASUR and the South American Defense Council, Mexico is not. Instead,

Mexico maintains close security cooperation with the US and the Central America

countries, which have also created their own security cooperation forums – such as

the Central America Regional Security Initiative. The cooperation in the different

security related organizations reflect both common and divergent security threats and

interests. Despite sharing basic UNASUR goals, Bolivia, Ecuador and Venezuela

also pursue separate goals within ALBA.

As the above examples demonstrate, there are different cooperation patterns (and

regional organizations) in different issue areas. Trade is not the only foundation for

regional cooperation and integration. And as Riggirozzi (2011: 34) stresses, there

has been “a strong critique to unmediated marketization reclaiming the region as a

space for the provision of regional goods beyond trade and market competitiveness.”

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Moreover, when we look at the basis for trade-based integration, the picture is quite

mixed. Trade statistics demonstrate that intraregional trade in Latin America and in

the different regional and subregional integration systems is low (see also Burges

2005) and much lower than in other world regions such as Europe, Asia and NAFTA

(but not in Africa, see Draper 2012). In 2012, intraregional trade in Latin America

amounted to only 11 percent in the case of Mercosur, 7 percent in the case of the

Andean Community (CAN), 26 percent in the case of the Common Central American

Market (CACM) and 18 percent for all of Latin America. Intraregional trade is much

higher in NAFTA (48 percent) and in the Americas (54 percent). This is basically the

result of the strength of US exports to and imports from the Western Hemisphere.

Table x: Intraregional Trade in Latin America and the Americas (2012)

Intratrade destination LA dest. NAFTA dest. Americas

Mercosur 11 22 18 39

CAN 7 28 33 61

CACM 26 39 38 74

Latin America 18 18 42 59

NAFTA 48 18 48 57

Americas 54 19 42 54

Source: IADB 2012a

From a strictly economic perspective, an FTAA would make more sense than the

different subregional integration projects in Latin America. However, these are not

merely economic projects; they reflect the regional projects of regional major and

minor powers. Regional projects such as Mercosur, UNASUR and ALBA mark the

regional landscape more than economic interdependencies; regionalism and

regionalist projects are not only related to trade and “market governance” (Riggirozzi

2011: 34). One might also argue that with the percentage of intraregional trade quite

low, there is perhaps less need for a deepening of regional economic integration in

Latin America, and more need for “an explicit political agenda oriented to an

assertion of political identity within the wider region and within the global political

economy” (Phillips/Prieto 2011: 120).

Up to now, much of the debate on regional integrations has been too focused on

structures (supranational organizations), and less on the functions that these

structures have to comply with. Weak intraregional economic interdependencies do

not need strong supranational economic institutions. Different patterns of cooperation

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in different issue areas can coexist; in some cases, regional organizations may

compete and overlap in the same issue area. Regional projects and the regional

powers that promote these projects are drivers of regional cooperation and

integration. From this perspective, regions – which are socially and politically

constructed – are an area for contestation (Riggirozzi/Tussie 2012b: 6).

4. Regionalism Is What Actors Make of It

Sanahuja (2012a: 25) writes that through UNASUR “the aspirations of Latin American

regional integration are redefined in a South American geographical and ideational

framework.” Regions and regional projects are historically contingent and changing

social constructs. There is not one prefabricated model of what constitutes a region.

Alluding to Alexander Wendt’s famous title, Riggirozzi and Tussie (2012: 3) write that

“region is what actors make of it.” This article shares the vision that one should take

seriously the statements, declarations and proposals of actors involved in regional

projects and should not ask for the delivery of goods not promised by the actors

involved (in our case, Latin American governments). However, this is a major bias

found in many recent analyses of current Latin American regionalism. These

analyses start with a preconceived notion of what regionalism should be and normally

end up with a narrow model of European-style integration that includes strong

supranational institutions and the transfer of sovereignty. For example, Malamud and

Gardini (2012: 130) state that “Latin American states continue to establish regional

organizations because their leaders know that sovereignty is not relinquished by

signing papers. Rather, regionalism is a foreign policy resource used to achieve other

ends such as international visibility, regional stability and regime legitimacy.” One

might ask what is problematic with regard to these self-declared goals. The only fault

is that they do not correspond to the EU model.

Although the European experience of regional integration is unique, many authors

often take Europe as the “gold standard” of regional integration (Sbragia 2008: 33).

Subsequently, they come to the unsurprising conclusion that regional experiences

outside of Europe do not constitute real integration. 8 A good example of this

8 What Söderbaum and Sbragia (2010: 565) write about earlier studies of regionalism and regional integration, especially from a neofunctionalist perspective, is still valid for more recent studies: “All too often (but not always) the European Community was seen and

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approach is an article by Andrés Malamud and Philippe Schmitter (2011: 143), who

start with the statement that they understand integration in European terms – quoting

Haas (1971) – as a process in which nation states voluntarily mingle, merge and mix

with their neighbors so as to lose the factual attributes of sovereignty and (adding to

Haas’s definition) “that they do so by creating common and permanent institutions

capable of making decisions binding on all members.” From this perspective, CAN

and MERCOSUR have made little progress toward integration. Both authors are

strictly against a softening or changing of the definition because they fear an

overextension (conceptual stretching) of the concept of regional integration. In their

view, “regional integration should be conceptually differentiated from simple, that is,

un-institutionalized and usually erratic, regional cooperation or collaboration.” There

seems to be a very strong bias against all kinds of regional integration and

cooperation that do not resemble the European pattern. Consequently, Malamud and

Schmitter (2011: 143) disagree that there might be “a distinctive “Latin American” (or,

for that matter, “Asian”9 or “African”) pattern of integration that may not resemble the

European “institutional” one, but nevertheless is capable of resolving regional

problems, asserting regional cohesion and building regional identity.”

But some Latin American authors articulate a totally different vision of integration. In

the view of the Argentinean economist Aldo Ferrer (2013), the key for successful

integration does not rest upon the delegation of sovereignty to supranational

communitarian institutions. For him, the experience of the European Union

demonstrates that the concession of sovereignty results in the subordination of the

weaker states to the hegemonic power of the stronger states. Therefore, he argues in

favor of an integration that is not based on the transfer of sovereignty but rather in

the solidary construction of sovereignty, which is still missing for many Latin

American states in certain issue areas. Thus for Ferrer, “integration consists in the

advocated as the model and other looser and informal modes of regionalism were, wherever they appeared, characterised as ‘weaker’ or ‘failed’ (i.e. with no ‘regional integration’ according to the predominant definition).” 9 Kahler (2013: 15) defines the “Asian Way” as follows: “Governments have been reluctant to delegate substantial authority to regional institutions; limited delegation is combined with low levels of legalization, measured by precise and binding obligations. Asian regional institutions are also exclusively intergovernmental: Non-state actors are not directly enfranchised in regional courts or other institutions. The decision rules of these institutions are based on consensus building, which emphasizes persuasion and deliberation, rather than decisiveness. Membership tends to be set by geographical criteria rather than policy stipulations; policy convergence is expected after accession through a process of socialization.”

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complementation and extension of national sovereignties.”10 For Van Langenhove

(2012: 20) “regions can take over or complement state actorness”.

Public opinion surveys in the region corroborate the preference for a Latin American

type of integration focused on economic cooperation and liberalization and the

improvement of regional infrastructure, and less interested in the creation of

supranational institutions and in relinquishing sovereignty. In general, Brazilians,

Chileans, Colombians, Ecuadorians, Peruvians and Mexicans did not place great

importance on the promotion of regional integration as a foreign policy objective

(Maldonado 2012).

Rising powers such as Brazil, China, India and South Africa do not promote an EU-

type model of regional integration (Fawcett 2013). Against these countries will and

without their participation, it will not be possible to create this kind of institution in the

corresponding regions. One should also mention that the euro crisis has seen the EU

become a less attractive role model. Furthermore, the EU has also demonstrated that

there is a risk of estrangement between the citizens of member states and the

supranational institutions. One should not forget that integration is not an end in itself;

its success and institutional arrangement depend on the interests of the participating

states and those states’ citizens. The EU is not always seen as the benchmark for

integration processes.

5. Regional Integration or Regional Governance

Critics of Latin American regionalism often start with a narrow definition of regional

integration or ask Latin American governments for something that they did not

promise or did not aim for. However, if one accepts that actors decide what

10“La clave del éxito de la integración no radica en la delegación de soberanía a órganos supranacionales comunitarios. La experiencia de la Unión Europea alcanza para demostrar cómo la cesión de soberanía termina subordinando a las partes más débiles al poder hegemónico de los más fuertes. Mucho peor, cuando en el régimen comunitario, como sucede en la Unión Europea, prevalece el paradigma neoliberal. Nuestra integración no radica en la cesión de soberanía, sino en la construcción solidaria de la soberanía que nos falta en la ciencia y la tecnología, el desarrollo industrial y la inclusión social. En materia financiera, en tiempos recientes, se han dado pasos positivos en tal sentido, a través del desendeudamiento externo, la acumulación de reservas internacionales y los controles de los capitales especulativos. La integración consiste entonces en la complementación de las soberanías nacionales a través de reglas realistas de la integración” (Ferrer 2013).

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regionalism is, one should look for concepts that can capture different and changing

regional projects and forms of regional cooperation.

Regionalism is generally accepted as an overarching concept referring, respectively,

to “the formation of and policies pursued by inter-state groups based around regions”

(Nye 1968: vii), “the policies and practices of state-based permanent organizations

with membership confined to a limited geographical area” (Fawcett 2013: 4), “the

policy and project, whereby state and non-state actors cooperate and coordinate

strategy within a particular region” (Söderbaum 2009) or “a state- or state-led project

to organize a region along particular political and economic lines” (Phillips/Prieto

2011: 117).

Even though there is no substantial variation with regard to the meaning of the

concept of regionalism, some definitions are technically more neutral, while others

have a transformative or teleological component. There are also some definitions that

are more economistic and demanding, which risk leading to negative conclusions.11

While there is a basic consensus on the concept of regionalism, there is much less

consensus on how to conceptualize different forms of regionalism. Most authors will

agree that regional integration is a narrower subcategory of regionalism that is

principally based on the European post–World War II experience. Börzel (2013: 508)

differentiates between regional cooperation and regional integration. She contends

that regional integration “involves the setting up of supranational institutions to which

political authority is delegated to make collective binding decision,” whereas regional

cooperation refers to “the joint exercise of state-based political authority in

intergovernmental institutions to solve collective action problems related to economic,

political or security issues.”

Although Börzel (2013) argues strongly in favor of clearly differentiate between

regional cooperation and regional integration, one might also conceptualize regional

integration as a special type or subset – “not the most successful or even the most

frequent” (Malamud 2013: 2) – of regional cooperation. From a neofunctionalist

perspective, regional integration might be the unintended consequence of regional

cooperation. Quite often, regional integration projects have resulted in some shallow

11 ‘‘Regionalism in Latin America can best be understood as serving a set of political objectives, but that it can no longer be seen as playing a significant role in driving processes of structural political-economic change in the region’’ (Phillips/Prieto 2011: 120).

17

form of regional integration that some other authors would classify as mere regional

cooperation.

Börzel (2013) perceives regional (intergovernmental) integration and regional

(supranational) cooperation as two opposite ends of a continuum of regionalism.

However, one might ask whether too much emphasis is being placed on one end of

the continuum (i.e., regional integration) given that there is only one flawless example

for this category: the EU. On the other hand, the terrain between these opposite ends

remains largely unexplored. Moreover, it seems to be that the landscape between

regional cooperation and regional integration is more populated than the regional

integration corral.

Malamud (2010: 650) argues that without the Latin American test case, there would

be no basis for the comparison of the integration process in the EU (“the n = 1

problem”). Therefore, he claims that “comparative regional integration, not

comparative governance, is the only way to deal with the root phenomenon.”

However, there are good arguments against using a narrow concept of regional

integration as a benchmark for regionalism:

It is important to take seriously the statements, declarations and proposals made

by the actors (in this case, Latin American governments) involved in regional

projects, rather than to ask these actors to deliver projects in which they were not

involved and did not promise. (Regionalism is what actors make of it.)

Regional integration constitutes, at best, only a small subcategory of regionalism.

(Do not generalize too much from a limited number of cases.)

Taking a strict definition of regional integration, which is based on the unique case

of the EU, will result in other regional arrangements being considered

unsatisfactory approximations of successful (EU-type) regional integration at best.

(Do not generalize from a single case study; EU scholars should accept that

they are “only” area and case specialists.)

The cases situated between pure regional integration and pure regional

cooperation are more frequent and perhaps more interesting from a comparative

and real world political perspective. (There are more cases of “regional

integration/cooperation” outside of Europe.)

• There is a bias toward focusing on a single regional organization focusing when

analyzing regional integration. Regions are, however, generally constituted by

18

more than one organization – which is also true for Europe. Of greater interest

should be the interaction pattern between different regional organizations. (The

whole is greater than the sum of its parts.)

• In general, there are different regional organizations that overlap and compete

with regard to membership and mandate; this often reflects competing models of

regional integration/cooperation. (Regions are areas of contestation for

regional projects and competing or complementary regional organizations.)

• Regional organizations separate the region as a subsystem from the international

system and can be used as instruments of discrimination toward and exclusion of

other states. This outside-inside dimension is often neglected when the topic of

regional organizations is discussed from a narrow regional integration perspective.

(Take regional organizations as gatekeepers.)

• Actors can use regional organizations to create rules and norms with a view to

protecting their autonomy from the dominance or abuse by more powerful actors

from outside of the region (Take into account the “norm subsidiarity” of

regional organizations.)

• Regionalism is not only market integration. There are also other issue areas of

equal or greater importance – for example, regional security (Trade is not all you

need, give peace a chance.)

• A region is a space for the promotion of regional independencies and the

provision of regional public goods beyond trade and market competitiveness

(Take a look at regional public goods.)

• Up to now, much of the debate on regional integration has been too focused on

structures (supranational organizations) and not focused enough on the functions

that these structures have to comply with. For example, weak intraregional

economic interdependencies do not need strong supranational economic

institutions. (Form follows function.)

• One should differentiate between the process of integration and the governance

of integration (Sbragia: 2008: 35). (There might be different forms of

governance in processes of integration.)

• Regional projects and the regional powers that promote these projects are

important drivers and spoilers of regional cooperation and integration. The same

is true of external powers with influence or influential regional partners that can

19

exert pressure on the processes of regional integration. (Context and power

matter.)

As can be seen, the concept of regional integration manifests some problems. One

solution might be to adapt and make more flexible the concept of regional integration.

It might be “used as synonymous for regionalism and/or regionalization” (De

Lombaerde 2011: 38) or defined as “a historical process of increased levels of

interaction between political units (subnational, national, or transnational), provided

by actors sharing common ideas, setting objectives and defining methods to achieve

them, and by doing so contributing to building a region” (Dabène 2009: 215). From

another perspective, regional integration can be perceived “as a platform for

functional cooperation.” It “allows countries to pursue more effective collective

policies beyond trade integration, in particular: (i) a greater voice in global fora […]; (ii)

a platform for the provision of regional public goods (RPGs) […] and (iii) a natural

space to address asymmetries and promote cohesion.” (IADB 2011: 6)

In contrast to economic liberalization and trade agendas that have dominated in the

past, other authors introduce the concept of “positive regionalization” or “positive

integration” as a new subcategory of regional integration based on political

consensus building, the promotion of regional independencies, and an increase in

cooperation in nontrade issues (e.g., energy, infrastructure, finance and regional

security) (Ayuso 2012; Sanahuja 2010; Sanahuja 2012a). The concept of positive

integration is compatible with different regional projects covering different issue areas

and the overlay of regional organizations. It might also be applicable to integration

projects in Africa (see Draper 2012).12

Van Langenhove (2012: 18/20) conceptualizes regional integration as “the formation

of supranational spaces of cooperation between states.” In his view, “regions can

take over or complement state actorness.” Although, Goltermann et al. (2012: 4)

define integration – rather similarly to Börzel (2013) – as “a transfer and pooling of

sovereignty rights to a third body, usually a regional organization,” one might ask

whether the pooling and the transfer of sovereignty necessarily go hand in hand.

12 With regard to the perspectives of regional economic integration in sub-Saharan Africa, Draper (2012: 79) mentions the pooling of capacities to provide regional public goods and construct network services (energy, finance, telecommunications, transport).

20

With the objective to advancing toward a “post-Westphalian” concept of state and

pooled sovereignty, Sanahuja (2012) argues in favor of a “denationalization” of the

concept of sovereignty and space as well as of the “locus” of politics and power. The

question is whether this is possible without the creation of strong supranational

institutions – like those found in the EU. Is there another model of pooled

sovereignty and of a “post-Westphalian” order? Perhaps a pooling of sovereignty is

possible without transferring sovereignty; there may be different types and paths of

integration.

Van Langenhove (2012: 21/28) differentiates between three major types of actions

that lead to regional integration: “removing economic obstacles towards integration;

building adequate institutions or regulations that favor the delivery of regional public

goods; and presenting the integrated region as a unit with some level of sovereignty.”

This can lead to three different major varieties of regional integration: “a single

market; a provider of services and policies; and an international actor with a certain

degree of actorness in global affairs.”

One might also ask whether there is a need for concepts other than “regional

integration” to analyze the evolving Latin American regionalism. Based on the

previous arguments, such a concept should capture the pooling of sovereignty

without the necessity of building supranational institutions, the formation of

supranational spaces of cooperation, the actorness of a region in regard to actors

outside of the region, the provision of regional public goods, and the integration of

different regional organizations and competing regional projects.

What are the alternative concepts to regional integration and regional cooperation

that can be used to describe the field of regionalism and to analyze the evolving Latin

American regionalism? One option would be “regional architecture;” often used, but

seldom defined. More recently, regional architecture has been defined as “a

reasonably coherent network of regional organizations, institutions, bilateral and

multilateral arrangements, dialogue forums and other relevant mechanisms that work

collectively for regional prosperity, peace and stability” (Weixing Hu 2009: 14). One

can also adapt the concept of “global governance architecture,” which has been

defined as “the overarching system of public and private institutions that are valid or

active in a given issue area of world politics” (Biermann et al 2009: 15) to the regional

level. While the first definition makes no reference to rule setting and rule enforcing in

21

a territorial (regional) space, the second definition describes “architecture” “as the

meta-level of governance” and is focused on a particular issue area (Biermann et al

2009: 15f.).

Regions are political constructs. Regional organizations perform regulatory functions

within the corresponding region. Therefore, the regulations and political institutions

that construct the territorial space of a region should be at the core of a concept that

distinguishes between different forms of regionalism. This article argues that the

concept of regional governance is the most adequate concept to capture the

variations of regionalism and of regional projects. This idea is not new; “regional

governance” is often used in textbooks, but often not clearly defined and

conceptualized.

How is regional governance best defined? Schimmelfennig (2006: 154) defines

regional governance as a “regional space of political order and regulation” (“einen

regionalen Raum politischer Ordnung und Steuerung”). Söderbaum (2004: 422)

draws on Rosenau (1997) and defines regional governance “as spheres of authority

at the regional level of human activity which amount to systems of rule – formal and

informal, public or private – in which goals are pursued through the exercise of

control.” Although Fawcett and Serrano (2005) do not provide a clear-cut definition,

they appear to adhere to a dynamic concept of regional governance13 that refers to a

process of setting rules and creating rules, which are enforced by institutions within a

geographical space (Fawcett and Serrrano 2005: 19).14

Riggirozzi (2011) uses the concept of regional governance in the sense of models of

governance that manifest a different logic of structuring a region with regard to the

institutionalization of norms and practices in support of a regional community.

Jayasuriya (2004: 21–22) also makes reference to “regional governance projects.”

His encompassing definition fixes the following parameters. Regional governance

projects should be composed of four core elements: (1) a stable set of international

13 “The real game of governance lies in defining the rules before playing them” (Serrano 2005: 19). 14 Adler and Greve (2009: 64–65) define governance as an “order-creating mechanism” and security governance “as a system of rule conceived by individual and corporate actors aiming at coordinating, managing and regulating their collective existence in response to threats to their physical and ontological security. […] Mechanisms of security governance are a more or less clearly delineated set of rules, norms practices and institutions that coordinate security relations between actors in the international system.”

22

economic strategies, (2) a distinctive set of governance structures that enable

regional economic governance, (3) a set of normative or ideational constructs that not

only make possible a given set of regional governance structures but also make

possible the very definition of the region, and (4) a convergence of domestic

coalitions and political economy structures that facilitate the coherent construction of

regional projects.

In another article, and without the strong economic component of the former

definition, Jayasuriya (2009a: 321)15 defines regional governance more broadly as

“the management of the conflicts created through growing interdependencies within a

specific – albeit ideologically-constructed – geographical region through the creation

of institutional forums, policy instruments and networks of private and public

actors.”16 He further adds that “regional governance encompasses those institutions,

instruments and mechanisms that allocate power, influence material stakes and

shape the ideological representation of the region itself.”

Summarizing these definitions, regional governance refers to international

institutions/organizations and normative/ideational constructs as well as to the

process that creates these institutions and norms. 17 Regional governance is

essentially, but not exclusively, based on regional organizations. It is not restricted to

a single organization but refers to the set of relevant regional organizations and their

interaction patterns. One may define regional governance as the overall configuration

of regional organizations that frame the regional discourse of the member states and

generate the norms and rules for the region that contribute to the solution of

collective problems and to the realization of common benefits.

But can the concept of governance confront the problem of different and overlapping

organizations within a region and of different interaction patterns between regional

organizations? For the analysis of regional governance, this article adapts an

interesting research approach developed for the analysis of global climate

15 In another article, Jayasuriya (2009b) focuses on new modes of regional governance (regulatory governance) based on region-wide regulatory frameworks that as a new form of multilevel governance transform the internal spatial architecture of the state. 16 Komori (2009) in his concept of a “multilayered” form of regional governance also includes nonstate actors, even though national governments remain the dominant actors. 17 This conceptualization of governance is congruent with the definition of Keohane and Nye (2000: 12): “By governance, we mean the processes and institutions, both formal and informal, that guide and restrain the collective activities of a group.”

23

governance (Biermann et al 2009). Based on the fragmentation of global climate

governance, the authors created an analytical scheme that could capture the

possible effects of fragmentation. This article is interested in the potential positive or

negative interaction patterns of competing and overlapping regional organizations,

which can be complementary or competitive. Biermann et al. (2009) employ three

criteria or analytical dimensions to differentiate between degrees of fragmentation,

which can be adapted for the analysis of regional governance patterns: (1)

institutional integration and the degree of overlap between decision-making systems

(= regional organizations), (2) the existence and degree of norm conflicts (between

regional organizations), and (3) the type of actor constellations – which in the case of

regional governance refers particularly to the interests and politics of regional powers

and secondary powers. Just as Biermann et al (2009) differentiate between three

different kinds of fragmentation (synergistic, cooperative and conflictive), this article

uses the same categories to differentiate between different patterns of interaction

between regional organizations and state actors within a region in order to classify

different types of regional governance (see table xxx) – synergistic, cooperative and

conflictive regional governance. In the future, it should be possible to refine this

scheme to differentiate between different degrees within the analytical categories –

for example, between “deep” and “shallow” regional governance (adapted from De

Lombaerde 2011: 36).18 And it will be necessary to develop indicators for the different

analytical categories (work in progress!!).

Table xxx: Patterns of Regional Governance

Synergistic Cooperative Conflictive

Institutional Integration

One core institution,

with other institutions

being closely integrated

Core institutions with

other institutions that

are loosely integrated

Different, largely

unrelated institutions

Norm Conflicts

Core norms of

institutions are

integrated

Core norms are not

conflicting

Core norms

conflict

Actor Constellations

All relevant actors

support the same

Some actors remain

outside main

Major actors support

different institutions

18 Another option could be to differentiate between “patterns of regional governance” and “forms of regional governance” as a product of region building (Van Langenhove 2012: 17) and combine both analytical concepts. See also Genna and Lombaerde (2010: 584) who introduce the concept of the “institutionalization of the regionalization process,” which “can be very weak (or even nonexistent) or supranational in nature, which speaks to the degree of integration.”

24

institutions institutions, but

maintain cooperation

Source: Adapted from Biermann et al. (2009: 19)

Table 1: Regional Governance Complexes

Synergistic Cooperative Segmented

Institutional Integration

One core institution, with other institutions being closely integrated

Core institutions with other institutions that are loosely integrated

Different, largely unrelated institutions

Norm Conflicts

Core norms of institutions are integrated

Core norms are not conflicting

Core norms in conflict or unrelated

Actor Constellations

All relevant actors support the same institutions

Some actors remain outside main institutions, but maintain cooperation

Major actors support different institutions

Based on this approach, the EU represents synergetic regional governance, South

America features strong cooperative regional governance, Latin America reflects

weak cooperative regional governance, and the Western Hemisphere constitutes a

form of conflictive regional governance.

6. The New Architecture of Regional Governance in Latin America and the

Implications for the Interregional Relations between Latin America and

Europe

The first biregional summit between the EU and CELAC (the recently created all-

inclusive regional organization of Latin America and the Caribbean) in Santiago de

Chile in January 2013 did not produce any important new initiatives. However, it did

incorporate new actors and widen interregional dialogue through the inclusion of a

judicial summit with representatives from Latin American and European Supreme

courts and an academic summit with delegates from Latin American and European

universities and research institutes (Gratius/Nolte 2013).

The countries of the newly created Pacific Alliance (Mexico, Colombia, Peru and

Chile) took advantage of the EU-CELAC Summit to promote their common project

and their interest in free trade and foreign direct investment (within a framework of

stable property rights). While the ALBA countries generally articulated a critical view

25

of a free trade–based cooperation with the EU, the MERCOSUR countries –

especially Argentina and Brazil, the drivers of MERCOSUR – were not able to

present a common position. Moreover, on their way to Santiago, EU representatives

stopped in Brasilia for a separate EU-Brazil Summit as part of the strategic

partnership between the EU and Brazil – once more setting Brazil apart as a

privileged partner.

At first sight, it seems paradoxical that the first biregional summit between the EU

and CELAC took place in a context of regional fragmentation and (subregional)

competition. In view of the divergent interests articulated by Latin American countries

and regional organizations, one might ask how a variable geometry of regional

governance in Latin America and to a smaller degree in Europe is compatible with a

strategic partnership between these two regions.

On the one hand, the course of the EU-CELAC Summit demonstrated the conflicts of

interest in both regions and also reflected differences with regard to the regional

governance structure in Europe and Latin America. On the other hand, it also

revealed some advantages of cooperative regional governance and a variable-

geometry type of governance architecture on the Latin American side.

The differentiated multilateral cooperation patterns in Latin America open up more

access points for external actors such as the EU. There is less risk of a total

stagnation of inter-regional cooperation. The EU has reacted to the divergent

cooperation patterns and interests in Latin America with the differentiation and

multilateralization of its relations. The EU quite recently signed free trade and

cooperation agreements with Central America as well as with Colombia and Peru,

while free trade agreements with Chile and Mexico entered into force some years

ago. In addition, the EU has signed an economic partnership agreement with the

member countries of the CARIFORUM and also maintains strategic partnerships and

holds separate meetings with Brazil and Mexico.

The variable geometry of cooperative regional governance offers EU and Latin

American countries the opportunity to create and maintain differentiated networks of

cooperation that respond to the converging or diverging interests of the involved

partners. Such an arrangement will help reduce vetoes by individual countries

blocking the whole process of interregional cooperation. When the negotiations for an

26

association agreement between the EU and the Andean Community were blocked by

Bolivia and Ecuador, the EU signed an agreement with only Colombia and Peru. In

the future, the topics and format (bilateral, intersubregional or interregional) will be

adjusted to the interests and the influence of the partners on both sides.

The examples of Europe and Latin America demonstrate that although regions can

be constructed quite differently and evolve with regard to their institutional

architecture, they can nevertheless establish an interregional cooperation pattern.

This pattern reflects the differentiated constellation of interests on both sides

(especially with regard to the major regional players) and the dissimilar regional

governance structures in Europe and Latin America. The result is a multilevel policy

of concentric circles, which currently include the following elements (Gratius/Nolte

2013):

EU’s close bilateral relations with its strategic partners Brazil and Mexico and the

countries of the Pacific Alliance (Chile, Colombia, Mexico and Peru)

dialogue and development cooperation with weaker partners and biregional

relations with Central America and the Caribbean

summit meetings between both regions in a bioregional format that define

corridors and overarching aims of cooperation

The variable geometry of internal and external cooperation diminishes the risk of

stagnation in interregional relations between Europe and Latin America. However, it

also makes Latin America more porous with regard to external influences. Therefore,

a principal challenge for cooperative regional governance in Latin America will be to

create institutional mechanisms that guarantee a minimum degree of coherence in

interregional relations.

27

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