Mercosur: Evolution and Implications for U.S. Trade Policy [March 26, 2008]   [open pdf - 159KB]

"Mercosur is the Common Market of the South established by Brazil, Argentina, Uruguay, and Paraguay in 1991 to promote economic integration and political cooperation among the four countries. Since then, Mercosur has struggled to achieve deep economic integration, but has maintained a cooperative economic and political framework, which has also become an influential voice in determining the fate of the hemisphere's regional integration initiatives. In particular, the U.S. vision for hemispheric integration, the Free Trade Area of the Americas (FTAA), has stalled largely because of opposition from within Mercosur, which in turn has focused on its own, albeit limited, expansion. […] It appears that Mercosur has opted to emphasize its expansion both in the region and with other developing countries over agreements with its largest developed country trade partners, looking to the World Trade Organization (WTO) as the preferred alternative for achieving many of its trade policy goals. Nonetheless, U.S.- Mercosur commercial and economic ties are expanding and the United States is pursuing deeper bilateral trade relations with Uruguay that could provide new ideas for a broader integration commitment. The alternative may be for Mercosur and the United States to expand their mutually exclusive bilateral agreements, increasing the potential for overlapping trading systems, which few, if any, view as either economically or administratively optimal."

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CRS Report for Congress, RL33620
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