The General Secretariat of the Andean Community of Nations (CAN) announced on Tuesday that trade between its four member countries—Bolivia, Colombia, Ecuador, and Peru—reached $10.4 billion in 2012. Exports within the bloc grew 12 percent, while exports to countries outside the bloc grew 3 percent in 2012.
The CAN has facilitated intra-regional trade in a number of areas but with the greatest emphasis on manufactured goods, which accounted for 75 percent of exports ($7.5 billion) last year. This includes soybean oil, refined copper wire, ultra-light aircraft, and medication.
Countries within the regional trading bloc have seen tremendous growth despite the global financial crisis. Peru boasts the second-fastest growing economy in Latin America averaging 7 percent growth per year for the past eight years. In comparison to the 3 percent average growth for the region in 2012, other members also saw high relative growth rates: Bolivia grew 5.0 percent last year, Colombia grew 4.5 percent and Ecuador’s economy grew 4.8 percent.
In a world shaped by bilateral and multilateral trade agreements, where goods and services cross borders with relative ease, it is often difficult to say the same about people. However, President Rafael Correa of Ecuador has been a leader in championing integration efforts, in particular open border policies in the Western Hemisphere. Ecuador’s 2008 constitution has provisions guaranteeing the free movement of people through Ecuador’s borders and the country is planning to pressure the Organization of American States (OAS) to adopt open-border policies that allow all people from the Americas to have free movement across the region.
On a visit to Colombia yesterday, Bolivian Foreign Minister David Choquehuanca said that Bolivia would seek to re-establish formal diplomatic ties with Peru as soon as possible. In a statement, Mr. Choquehuanca attributed the change of stance to popular demand saying, “Our peoples want harmonious relations...government officials must obey our peoples’ wishes.” A deterioriation in relations led to Peru recalling its ambassador to Bolivia on Tuesday.
This was in response to comments earlier this week by Bolivian President Evo Morales, describing the Peruvian government’s response to recent unrest in the Amazon as a “genocide” caused by free trade. Prior to recalling its ambassador, Peruvian Foreign Minister José Garcia Belaunde labeled Mr. Morales “an enemy of Peru.” Other Peruvian officials have suggested that Bolivia was interfering in Peru’s domestic affairs by actively inciting protests by indigenous groups that have so far left at least 34 people dead.
A warming of the rhetoric between the two Andean neighbors could be a first step toward improving the bilateral relationship which some experts believe “has never been so bad.”