MERCOSUR at Seven: Goals, Achievements, and Outlook

Mercosur has appeared as the most promising regional trade agreement ever since its creation in 1991. This paper compares its objectives with some of its early results, especially increased foreign direct investment and trade volumes — despite some controversial studies suggesting that diversion has outweighed creation — and expansion to other regional members; analyzes other issues where integration is still far from complete (obstacles to the opening of important markets, lack of macroeconomic coordination and common sets of rules in key policy areas, and infrastructure bottlenecks); and sketches the main challenges that lie ahead on the road to realizing Mercosur’s objectives. JEL Classification: F15, O54, P45.