ABSTRACT
This chapter provides a historical overview of each of the regional initiatives among South American countries. It discusses three of the main regional integration initiatives emerging during this period: the Asociacion Latinoamericana de Integracion (ALADI—Latin American Integration Association), the Comunidad Andina de Naciones (CAN—Andean Community of Nations) and the Mercado Comun del Sur (MERCOSUR—Southern Common Market). In 1980, ten South American countries, together with Mexico, signed the Treaty of Montevideo, giving birth to ALADI. The evolution of intra- and extra-regional trade levels in the Andean Community clearly shows that Andean countries trade more with extra-regional partners than among themselves. In 1994, the Ouro Preto Protocol maintained this institutional structure, while also creating the MERCOSUR Trade Commission and the Economic and Social Consultative Forum. While trade interdependence among MERCOSUR countries increased sharply during the first half of the 1990s, intra-regional trade levels have lagged behind trade with external partners in other regions.
