ABSTRACT
This chapter explains the development of Latin American and Caribbean (LAC) trade strategies is put forward, namely, that regional economic integration has constituted a reactive mechanism against perceived external risks, sometimes sustaining protectionism, and at other times fostering liberalization. The international system was framed by the bipolarity of the Cold War and the decolonization process that fostered nationalist sentiment and protectionist policies, whereas the regional context was characterized by the deceleration of economic growth that had been brought about by decades of import substitution policies. The period of 1930 to 1950 saw LAC industrialization and growth sustained to a large degree by the protection of domestic markets and proactive state economic policy. The institutional framework of the first wave of regionalism saw the establishment of the Latin America Free Trade Area (LAFTA) and the Central American Common Market (CACM) in 1960, the Andean Pact in 1969 and the Caribbean Free Trade Association (CARICOM) in 1973.
