Regional Integration of Trade in South America: How Far Has It Progressed and in Which Sectors?

Abstract

This article looks at the regionalization of trade in South America by looking at trends in trade during the 1994–2007 period. It finds that the increasing political will to strengthen regional arrangements, like Mercosur and the Andean Community, has not impacted extensively the overall level of regionalization of trade, which is relatively low and has not changed significantly over the period. Intermediates trade also remains relatively low within the region, which implies that regional production networks are under-developed, although high-tech and medium-tech consumer goods markets are relatively integrated. Overall high-tech trade is not notably more global than trade in other types of technology, except in imports.