Like the South American independence hero Simón Bolívar, his modern-day disciple Hugo Chávez dreams of unifying the region, to stand stronger against the “imperialist threat”. But if trade is anything to go by – an excellent way to bring regions closer together – the success of Chávez’s “Bolivarian revolution” has so far been mixed. This Friday 22nd April, Venezuela’s membership in the Andean Community of Nations (CAN), the regional trade bloc now comprising just Colombia, Ecuador, Peru and Bolivia, finally expires. It is being described as a “death blow” to the group, with trade between Venezuela and Colombia constituting about half its activity.
Indeed, when Chávez announced Venezuela’s withdrawal from the CAN exactly five years ago, in vigorous protest at attempts by Colombia and Peru to win free trade agreements with “the empire” (a.k.a. the US), he declared: “Today I can say that [the CAN] is dead, they killed it. It doesn’t exist… it’s only good for the elites, multinational companies, but it’s no good for the indians, the blacks, the whites, or the poor.”
But what will take its place? Chávez’s original idea was to instead join Mercosur, the trade bloc comprising Brazil, Argentina, Uruguay and Paraguay. But that plan has backfired somewhat, at least so far, with Paraguay’s congress still blocking Venezuela’s entry (congresses in the other three countries have approved Venezuela’s entry). According to Wikileaks, one Paraguayan senator said: “Not even if Chávez dresses up as Father Christmas will he get into Mercosur.”
Chávez has also been trying to promote an alternative trade group, the Bolivarian Alliance for the Peoples of our America (ALBA), in which goods can be paid for in kind. Apart from Venezuela, its principal members – Cuba, Boliva, Ecuador and Nicaragua – are relatively small economies; it’s debatable how successful this initiative has been.
Meanwhile Venezuela is extending current preferential tariffs with Colombia and Peru until new bilateral agreements are reached. But it’s unclear what will happen. Trade with Colombia in particular has been problematic, plummeting drastically after Chávez’s very public falling out with former president Álvaro Uribe. Things seem to be improving under the new president, but slowly, and Colombian businesses remain deeply suspicious of doing business with Venezuela, which still owes them hundreds of millions of dollars.
For the time being, perhaps those most affected by Chávez’s attempts to shake up regional trade are Venezuelan consumers. For their sake, let’s hope Chávez’s efforts to unify the region aren’t as unsuccessful as Bolívar’s, who died a disillusioned man, admitting that he had “ploughed the sea”.
