MERCOSUR & Regional Developments in South America; India, Brazil & SA (IBSA) Summit Preparations
Meeting Summary
A summary of this committee meeting is not yet available.
Meeting report
FOREIGN AFFAIRS PORTFOLIO COMMITTEE10 October 2007
MERCOSUR AND REGIONAL DEVELOPMENTS IN SOUTH AMERICA; INDIA, BRAZIL AND SOUTH AFRICA (IBSA) SUMMIT PREPARATIONS
Chairperson: Ms F Hajaig (ANC)
Documents handed out:
MERCORSUR/L and Regional Development in South America
Recent Political Trends in Latin America
Audio recording of meeting
SUMMARY
The Department provided an outline of regional developments in South America in terms of the Southern Common Market, known by its acronym in Spanish as MERCOSUR and in Portuguese as MERCOSUL. He emphasised the political benefits of forging strong Southern hemisphere organisations. The key was to ratify trade agreements in order to provide the scope for possible MERCOSUR – SADC co-operation. The development of left-leaning governments in South America was welcomed as providing a break from United States hegemony in the region, allowing for mutual benefit. The volatility of President Hugo Chavez’s approaches was outlined. Members were concerned about the impediments facing South-South co-operation, as well as the use of the Southern African Customs Union and not SADC as an organ of interaction. Furthermore the lack of Central American and Caribbean input was criticised.
The members discussed the logistics of the forthcoming IBSA Summit.
MINUTES
Department of Foreign Affairs on MERCORSUR/L and Regional Development in South America Ambasador Gert Grobler (Acting Deputy Director General: Americas and Europe) provided an outline of the Southern Common Market (MERCOSUR/L) which accounts for 75% of South America’s GDP. Venezuela and Bolivia’s ascension to full member status was discussed in the light of President Hugo Chavez’s critique of the organisation. The Ambassador likened MERCOSUR/L to the European Union, however in terms of its parliament it is closer to the African Union in that it only has an advisory capacity. The aim of the organisation is to create a continental free trade area. However interstate rivalry has led to the existence of several redundant regional co-operation entities, with the Andean Commission of Nations (CAN) being the most significant competitor to MERCOSUR/L. However talks concerning the possible integration of the two in the future are underway. The US-led FDDA is a direct competitor to this indigenous organisation.
The impetus for South Africa’s engagement with MERCOSUR/L is in part due to a shared colonial background as well as the strengthening of strong South-South relations in order to provide a counterpoint to traditional Northern dominion of the world. MERCOSUR/L is the third largest geo-economic bloc. Trade with South Africa totals R20 billion and the scope for increased trade is significant.
Ambasador Grobler outlined the various trade agreements and South Africa’s individual relations with Argentina, Brazil, Venezuela and Bolivia.
Essentially the major problems that needed to be overcome were identified as trade imbalances (in favour of MERCOSUR/L states) and the ratification of a SACU-MERCOSUR/L free/preferential trade agreement.
Recent Political Trends in Latin America
Ambasador Grobler stated that developments in MERCOSUR/L were directly affected by the predominating trend towards left-leaning governments. This trend was partially attributed to the election of President Hugo Chavez in Venezuela and President Evo Morales in Bolivia. Factors leading to this trend were cited as the failure of neo-liberal economic policies as well as the inability of previous (notably military) regimes to provide adequate services to the people. The increasing democratisation of Latin America provided the scope for freely elected leftist candidates to become elected legitimately. Consequently this had led to an assertion of independence from US dominance in the region and the repositioning of national interests. Essentially it might be seen as a reaction to US hegemony in the region.
The Ambassador differentiated between regimes that are influenced by a communist and socialist ideological background and those informed by nationalist and populist factors. The second category was inhabited by Venezuela and Bolivia and its leaders were distinguished by their actions against US imperialism.
In terms of regional integration, problems were caused by competing interests, especially between Argentina and Brazil. There was an active pursuance of the mitigation of trade dependency with the US However the Bolivarian Alternative for the Americas (ALBA) provided an alternative to MERCOSUR/L that had strong support from Chavez and Morales. However some countries were wary of the volatility of Chavez’s nationalist approach.
External role players on the continent included China and India. Africa had ample scope for increasing trade relation with the region, encouraged by the presence of large African diasporas in Brazil and Colombia.
Ambasador Grobler stated that this left leaning tendency was not new and that it provided the opportunity for a global reconfiguration of power in terms of a co-operative South-South agreement that would address the geo-political imbalances of the past. Thus it was necessary for South Africa to actively pursue strong ties with Latin America as a whole, and the Department of Foreign Affairs was looking at an active strategy in order to implement this.
Discussion
The Chairperson opened the floor to discussion, but stipulated that only five questions would be allowed due to time constraints.
Mr M Sibande (ANC) voiced concern over the lack of attention to Cuba in the presentation and stated that it seemed that South Africa had forgotten about its importance in assisting liberation movements during the struggle.
Amb Grobler replied that the presentation was focused on South America, not including the Caribbean and Central America. Cuba was a key country with which South Africa enjoyed strong ties that are reflected in the resources that are spent by Department of Foreign Affairs on Cuba. It was an increasing priority; however South Africa did have a Bi-National Commission (BNC) with Cuba as trade was increasing.
Mr B Skosana (IFP) asked whether other African countries had been invited to the forthcoming IBSA summit.
Amb Grobler replied that he did not deal with IBSA matters. However they envisaged expanding IBSA to encompass the whole of Latin America. He stated that when South Africa engaged IBSA it always furthered the African Agenda.
Ms K Rwexa (ANC) asked for clarity on how President Hugo Chavez intended to implement the nationalisation of resources in Venezuela, as his address during her visit to Venezuela did not address the mechanics of this process.
Amb Grobler stated that they did not entirely agree with how Chavez was implementing this process, but that the basic thrust was to retain control of natural resources, such as had been done in South Africa to a degree. However the fact of the matter was that the people were benefiting from what he was doing in terms of a fairer system of government, education and health provision. He stated that they had shared ideas with Venezuela on land reform.
The Chairperson was concerned about the pursuance of trade relations with South America under SACU instead of SADC. This was a conflict and the strengthening of SADC was vital to the African Agenda.
Amb Grobler replied that they had originally engaged them as SACU and that initially they were only interested in trade with South Africa. However negotiations led to them accepting engagement with SACU. However if regional integration progressed on both continents this would provide the scope for SADC – MERCOSUR/L – CAN engagement. However the SACU arrangement was a stepping stone for potential SADC agreements in the future
Mr M Ramgobin (ANC) asked what the impediments to regional integration in MERCOSUR/L were, as well as the cultural and economic asymmetries.
Amb Grobler replied that political and economic progress had not been optimum. Due to the pervasive US hegemony in the region, regional trade was not well developed. South America faced a lot of the same challenges that Africa did. However a fundamental impediment was the scale of economies in the region as well as a mixture of political differences.
India, Brazil and South Africa (IBSA) Summit
The Chairperson stated that the Minister wanted the Committee to play a vanguard role at the summit as there was the opinion that South Africa needed a parliamentary wing dealing with IBSA. She stated that members would be required to participate in seminars on the 16 October at the IBSA summit. Six Members of Parliament had been selected. The Portfolio Committee of Science and Technology would provide a contingent of three members. She outlined the programme for the seminars and stated that political considerations as well as sessions on global strategies of co-operation would take place, including the steps needed to get a parliamentary dialogue going between the member states.
Mr Ramgobin suggested that Gen B Holomisa take part as a member of the opposition.
The Chairperson agreed and stated that the job of the Committee was to attend the seminars but she did not know whether they would be allowed to attend the actual summit.
Mr Skosana stated that they needed to attend the actual summit to be informed enough to participate in the seminars.
The Chairperson agreed. She noted that a research report was available for members to peruse.
The meeting was adjourned.