Mercosur

MERCOSUR is a sub-regional trade and economic union between Argentina, Brazil, Uruguay, Paraguay and Venezuela. It was founded in 1991. Bolivia is in the process of becoming a full member. Chile, Colombia, Ecuador, Peru, Guyana and Suriname currently have the status of associate members. Mexico and New Zealand are official observers.

The official languages of the association are Guarani, Portuguese and Spanish. The population of the member countries of Mercosur is more than 300 million people (50% of the population of Latin America). The purpose of the agreement is to promote free trade, flexible movement of goods, population and currency of the member countries of the association.

The association is the second union after the EU in terms of size and economic potential and the third free trade zone after the EU and NAFTA. In 2019, the nominal gross domestic product (GDP) of Mercosur amounted to about 4.6 trillion US dollars, making the bloc the 5th economy in the world. In addition to the economic importance that MERCOSUR represents throughout Latin America, it has geopolitical significance because its two members Argentina and Brazil are members of the G-20.

The name of the organization translates from Spanish as "The Market of the Southern Cone" – the generally accepted name of the part of the territory of South America located south of 18° south latitude. The emblem of the organization is the image of the constellation of the Southern Cross. The strategic goal of MERCOSUR is to create an association capable of guaranteeing the economic growth of its participants with the intensive mutual trade and effective use of investments, as well as increasing the international competitiveness of the economies of the subregion.

The experience of MERCOSUR has shown that for the successful development of the integration association, membership of at least two economically strong countries is necessary. During the existence of MERCOSUR, there has been an expansion of trade and economic cooperation with other regional trade groupings in Latin America. Mutual investment activity has significantly increased, as well as the investment attractiveness of the region for foreign companies.

Despite the good results, MERCOSUR have the same problems of almost all integration associations of the "third world". The main problems are the differences of the countries and the relatively low level of their economic development. In MERCOSUR, large and relatively strong "new industrial countries" (Brazil and Argentina) are trying to integrate with small countries – Paraguay and Uruguay.