#65 Colombia and the Andean Group: Two Essays

By Miguel Urrutia M.

THE ANDEAN INTEGRATION PROCESS

The purpose of this essay is to explore the impact of ideological diversity on the process of economic integration in the Andean subregion. This diversity can affect the integration process in two ways. First, it can paralyze that process by making it difficult to reach agreement on the basic functions which different economic instruments should perform for the subregion's economies. Second, one government's ideological position can influence the economic development model pursued in another country or by the Andean Pact as a whole. 

In general terms, one can argue that it is difficult to imagine successful economic integration among countries with diverse economic ideologies. Among other things, integration requires common agreement on which instruments should be used to achieve economic efficiency. For countries which believe that market and price mechanisms allocate resources most efficiently, the integration process will involve adjusting tariffs and prices. For countries with centrally planned economies, sectoral plans will be used to allocate resources, and production goals will not take the price variable into account.

ECONOMIC AND POLITICAL DETERMINANTS OF REGIONAL INTEGRATION POLICY IN COLOMBIA

Colombian policy makers dedicate little time and effort to international relations. For example, in the period from 1974 to 1977, international relations, other than those pertaining to Andean Group negotiations, were never discussed by the Council of Ministers or the Council on Economic and Social Policy (the two executive councils chaired by the President and which meet regularly). This does not mean that Colombia did not have a foreign policy. During this period, the President and the Minister of Foreign Relations were closely involved in the Panama Canal negotiations, and the nation signed various treaties delimiting continental shelf boundaries with neighboring nations. But decision making was concentrated in the Presidency, and it was not felt necessary to involve other agencies of the government.

In contrast, issues concerning Andean Group negotiations were of ten brought to the Council of Economic and Social Policy (CONPES) and sometimes to the Council of Ministers. In addition, the Consejo de Comercio Exterior met often to discuss in detail negotiating options and results. These meetings were attended by the Ministers of Development, Finance, and Agriculture, and the heads of National Planning, the Central Bank, the Coffee Federation, IFI, and Proexpo. In addition, special ministerial-level working sessions were organized to hammer out negotiating strategies, and negotiating teams sent to Lima were often composed of technicians from the Ministries of Development (represented by Incomex personnel), Finance, IFI, and the National Planning Department.