Bolivarian Alternatives

A reader has asked about "Hugo Chávez' ALBA" which I mentioned as an example of inter-state associations that can limit multinational corporations' activity (see below, under headline "Globalization"). Here goes:

The Alternativa Bolivariana para los Pueblos de América is one of a half-dozen or more political-cum-trade associations among Latin American countries, in their attempts to establish policies and resources independent of the United States. In name and intention, "ALBA" is a direct response to "ALCA" (Área de Libre Comercio de las Américas ), Spanish acronym for the U.S.-sponsored Free Trade Area of the Americas.

ALCA/FTAA was founded at U.S. initiative in 1994 to reduce tariff barriers among 34 countries of the Western Hemisphere, that is, all of them except Cuba. Few, however, have actually joined, though the U.S. is still pushing the idea. Hugo Chávez has denounced it as another tool for imperialist exploitation by the U.S. The presidents of Brazil (Luiz Inácio Lula da Silva) and Argentina (Néstor Kirchner) have conditioned their participation on U.S. elimination of its agricultural subsidies (which appears unlikely), and there has also been loud objection to ALCA/FTAA's attempts to impose U.S. principles of "intellectual property" and patent protection, which the critics fear (with some historical basis) would be used to prohibit independent research and even exploitation of native plants which have been "patented" by a U.S. chemical company.

ALBA is the "alternative" proposed by Hugo Chávez. It does not exclude Cuba -- in fact, it was founded in Havana in 2004. (Just this week, Chávez surprised his Cuban hosts by proclaiming that "Cuba and Venezuela are really one government.") It does however exclude the U.S. It is "Bolivarian" both because Simón Bolívar (1783-1830) imagined a union of Spain's ex-colonies in America (he wanted to put its capital in Panama) and because it is Venezuela's treasury of bolívares (the national currency) that give it some plausibility. So far, besides Venezuela and Cuba, ALBA has negotiated agreements with Nicaragua, Bolivia, Haiti, and "bilateral agreements" (something less than full participation) with Argentina, Brazil, Paraguay, etc.

Along the same lines, but with more radical implications, Venezuela and Cuba (with Venezuela's money) have created a new alternative to the International Monetary Fund, from which Cuba was excluded and which Venezuela recently abandoned. It was launched in Haiti with with $1 billion of Venezuelan money. Most of the countries of South America have already agreed to participate in what has now been redefined as a development bank which (at Brazilian insistence) will limit its lending to South America (thus leaving out Nicaragua and Haiti and other Caribbean countries -- Venezuela presumably will continue lending to them outside of the new bank).