6.3. Nafta in the world integration process

Perspectives of the North American integration process’s development are widely connected with its spreading on the whole Western hemisphere. The connection between modernity and old doctrine of “Pan-Americanism” (was formulated at the beginning of 19 century in the frame of Monro doctrine to resist the European impact inside the South American continent) can be clearly seen in this process.

Firstly, proposition to create a custom union of American states was considered on the first Pan-American conference of 1889 and had failed. In the 1960s the USA President J. F. Kennedy proposed a wide-ranging program of democratization and economic reforms, expressively named as “Union for progress”. It was confirmed by the convened in his initiative Council of region state’s leaders in Punta-del-Este, Uruguay. Though, the Kennedy’s program as well as decision of the Council to create all-American free trade area till 1985, for some reason or other was not realized. In 1990, the USA President G. Bush suggested new “Initiatives for Americas” program and proposed countries of Western hemisphere to unite their efforts in the association of trade, investments and development contribution in the scale “from Alaska to Tierra del Fuego”.

Their readiness to negotiate with any Latin American state concerning their possible adherence to Agreement on North American free trade area, assured these intentions of the USA not to be utopia.

The idea of trade area “from Alaska to Tierra del Fuego” was embodied in entirely feasible project. An agreement to prepare an environment for FTAA creation (Free Trade Area of the Americas) was attained in December, 1994 on the meeting of 34 state’s leaders of Western hemisphere, named as The Americas Summit – 1994, that was initiated by the US President B. Clinton. The creation of FTAA embraced the creation of trade area on South, Central and North American territories.

As B. Clinton said, this wide project had had to open new opportunities in relations between countries of Western hemisphere. At the term of the century under circumstances of New forces balance this project entirely corresponded to economic, geopolitical and strategic interests of the USA. The majority of Latin American countries were interested in FTAA, though intentions and objectives of the sides didn’t always coincide with. Serious opponent of the USA concerning this project was Brazil.

But the project of FTAA wasn’t implemented. On the Americas Summit – 2005, which took place on November, 2005 in Mar del Plata, Argentine, the American project of wide common Americas market was opposed by Venezuela and MERCOSUR countries. First of all, as states-opponents explained, on the time of the summit the existing environment wasn’t enough to globally integrate. Secondly, they refused to accede the project because of the lack of the USA’s commitments concerning to open its agricultural market for Latin American goods and commodities.

The Americas Summit – 2005 was resulted in declaration of 29 countries (from 34) to support the project and to continue negotiation process concerned with completion of FTAA environment forming. The world community was informed about it by published communiqué.

The results of Americas Summit – 2005 led to USA review of geopolitical priorities relatively Latin American region in direction of economic cooperation extending. The US President B. Obama, supporting integration policy of his predecessors, has continued the course of intercontinental integration by using relatively new conventional and juridical instruments as conclusion of bilateral and multilateral treaties on free trade in Western hemisphere as well as out of its borders.

In such way the USA corrected its medium-term tactics of influence in the sphere of integration process in Western hemisphere as well as in the sphere of global integration, without changing of its long-term integration strategy. In 2010, acting agreements are agreement on free trade with Chili, Peru and treaty on Central American free trade area with participation of Guatemala, Honduras, Dominican Republic, Costa-Rica, Nicaragua, and Salvador. The USA concluded agreements on free trade with Australia, Singapore, Israel, Jordan, Bahrain, Oman, and Morocco. On the beginning of 2010, agreements on free trade area are signed with Columbia, Panama, and Republic of Korea, but they are not ratified by the US Congress. In prospect are agreements with Thailand, the UAE, and Malaysia; on the multilateral base are negotiations for agreements on new subregional free trade areas creation: Inter American zone with states of South African custom union and states of Andean free trade area – Columbia, Peru, Ecuador, Bolivia, and the USA.

The general peculiarity of all concluded agreements on free trade between the USA and other continents is their uniformity: such agreements correspond to WTO norms and principles and don’t contradict general commitments undertaken by countries-participants towards the world custom union.

A special feature of agreements on free trade is their monoconcentration (monocentrity): the USA, arranging the issues about free trade regime with a country or a group of countries, make possible to represent and dictate its interests on weaker partners and, thereby in such conditions economic integration transforms into unilateral.

Thus, the USA constantly search for new market to introduce their goods, services and capital in the frame of world economy, permanently improving its tactics to subordinate international economic integration towards their own interests. The international economic integration is efficient American instrument of its expansion into the world economy. Intensive and purposeful state support of its corporation and bank foreign activity strengthen the competitiveness of country’s producers-exporters on the international markets, and consolidate positions of the USA in the world economy.

Control questions and practical tasks:

1. Analyze and compare potential opportunities of NAFTA countries’ economies.

2. Show the peculiarities of integration process in the North America.

3. Give a comparative characteristic of NAFTA countries’ interests.

4. Define differences between Western European and North American models of economic integration.

5. Show the essence of Pan Americanism doctrine and peculiarities of its manifestation in modern conditions.

6. What are the possible perspectives of integration process development in the North America and its impact on the world economy?

7. How real is an idea to create the unitary free trade area in the Western hemisphere?

8. Why Canada and Mexico have close trade and corporate relations with the USA and rather confined between themselves?

9. What has caused the negative results of Americas Summit – 2005?

10. Comment upon the macroeconomic indexes of the final stage of NAFTA functioning.

11. What is the essence of the USA integration policy changes after the Americas Summit – 2005?

12. Explain the positions of the USA and Brazil concerning to integration future in the Western hemisphere.