A Long Way to Go

It was only last April that Latin American heads of state met in the gambling casino at Punta del Este, Uruguay, and agreed to get a Common Market in operation by 1970. By last week, that heady promise seemed to be considerably behind schedule. Assembled at Asuncion, Paraguay, to work out a preliminary plan for cooperation, the foreign ministers of the Latin American Free Trade Association (LAFTA) agreed on little but the magnitude of their differences.

The meeting got off to a fast start as the ministers churned out a steady stream of "agreements in principle" on the pace and percentages of the first tariff cuts. They even went along with Uruguay's plea that "an acute economic and financial crisis" entitles it to be classed among the "less developed" countries for the next five years, despite the fact that its people normally enjoy one of the highest standards of living in the LAFTA region. But such happy harmony was soon shattered when the three other "less developed" nations--Paraguay, Bolivia and Ecuador--demanded that their goods be allowed to move into the more industrialized countries duty-free, even before the first tariff cuts are scheduled to begin in about three years. Otherwise, they argued, their young industries will never be able to build enough muscle to be competitive within LAFTA. Although the stronger nations agreed on the need to make some concessions to the weaker ones, such extreme measures, they said, were out of the question. Peru vetoed the proposal. In turn, Paraguay, Bolivia and Ecuador were so piqued that they vetoed most of the earlier "agreements in principle."

Gloom, Not Doom. "We are still thinking in terms of our individual nations and not of the common benefits," complained a Venezuelan official after the conference finally broke up. Chile's Foreign Minister Gabriel Valdes Subercaseaux decried the "exaggerated, abusive" use of the veto, and Ecuador's delegate to Asuncion, Julio Prado Vallejo, said flatly that the conference demonstrated "the unacceptability of new compromises."

Despite that gloomy assessment, none of the foreign ministers thinks that the Asuncion Conference has doomed the grand vision of a free market stretching from the Rio Grande to Cape Horn. Indeed, one of the conference's achievements was the approval of a regional subgrouping within LAFTA that will soon open up a free-trade zone embracing 50 million people. The so-called "Andino group" of Colombia, Venezuela, Ecuador, Peru and Chile will begin planning its tariff cuts next month. As for LAFTA, its diplomats will resume talks in November. If nothing else, they discovered at Asuncion just how much work there is to be done.

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