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"Open" and "Closed" Regionalism Theories

(Apr. 3, 2008) The terms "Open" and "closed" regionalism refer to the degree in which regional blocks allow nonmember nations to access their markets. In this sense, an "open region" is one with few, if any, external trade restrictions while a "closed region" can be defined as one whose external trade policies seek to restrict commerce with nations outside the region.

Closed regionalism as practiced in Latin America grew out of the policy suggestions made by UN ECLAC/CEPAL school of dependency theory in the early 1960s. As discussed earlier, proponents of this policy argued that states should form regional alliances with a series of trade barriers against foreign products to foment regional industrialization and assure captive local markets for these manufactured goods. The failure of this system of integration to meet Latin America's economic goals became apparent during the 1980s and was further highlighted by the strong economic performance of developing Asian states who had favored the free "open" trade policies of the Washington Consensus.[1]

The counterpoint to closed regionalism, open regionalism, can be seen as a process through which nations hope to achieve greater insertion in international markets. Its practitioners try to harvest the most from regional cooperation while not limiting themselves in the type or number of other commercial partners they can pursue. Open regionalism blends earlier ideas of seeking strength through regional alliances with the more neoliberal model of global trade barrier elimination. This is also the trade policy endorsed by the presidents of South America who, in 2000, went on the record as saying that the union they envisioned would be an open region that would not try to limit the trade agreements independent nations choose to seek.[2]

By Nathan Gill - Southern Affairs
www.southernaffairs.org

Painting by Hung Liu, The Trophy, 2001, oil on canvas

[1] Ortiz, Benjamín. Personal Interview. Quito 5 Feb. 2008 [2] Comunicado de Brasilia: Reunión de Presidentes de América del Sur. Brasilia 31 Aug. to 1 Sept. 2000 "En la línea de los principios del "regionalismo abierto", los Presidentes registraron la meta compartida de formación de un espacio económico-comercial ampliado en América del Sur – basado en la articulación entre el MERCOSUR y la Comunidad Andina, y con plena participación de Chile, Guyana y Surinam –, dirigido hacia la liberalización progresiva del intercambio de mercancías y servicios, la facilitación de inversiones y la creación de la infraestructura necesaria."

Comments

  1. Hello! Me Wangbu. Soy de las Filipinas. Usted tiene un interesante blog. Me alegro de visitar aquí.

    ReplyDelete
  2. Thank you Wangbu. I appreciate your feedback.

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  3. Dear Nathan,

    I really enjoyed reading the three articles on regionalism theories back to back. As you know, I am not familiar with the region especially with its history. From the theoretical perspective, however, it may be beneficial to highlight the notion of sovereignty and its limitation thereof due to regionalism. Also, I have few hypothetical questions that I do not necessarily have the answers to, but I just wanted to brainstorm on them together with you.
    1) In an international platform if certain states commit collective action on an ad hoc basis, would that constitute as regionalism? I have the example of certain countries walking out of the Doha negotiations in mind.
    2) When a regional agreement contradicts pre-established bilateral agreement between a party to the regional agreement and a third party, which agreement prevails? For example, lets assume Peru, Ecuador, Chile and Colombia agreed to impose quotas on American potatoes. However, lets also assume Chile has a separate bi-lateral free-trade agreement with the US which has a clause on potatoes especially. Which one would prevail? My thought would be that Chile would have a carve-out clause in the regional agreement exempting itself from the quota regime citing its prior commitment. But what is Chile neglects such a thing?
    Two last things I want to point out before my coffee wears out. In one of the articles, if I understood correctly, it gives the impression that regionalism is the path for small(er) countries to be assertive in the international arena. If it is the case, it does not explain then why Switzerland or Norway are not members of the EU.
    The second thing is on Arab League. I am not sure if it is constituted as a regionalist entity. It is certainly built on cultural and ethnic lines but includes East and North Africa as well as Middle East in its geographical establishment.

    On an unrelated note, I apologize for not keeping in touch for a while. I have been very busy. I will send you an e-mail as soon as possible.

    You are sorely missed.

    Emre

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