PROSPECTS FOR THE GROUP OF EIGHT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP04T00990R000100740001-9
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 8
• Document Creation Date: December 27, 2016
• Document Release Date: May 30, 2013
• Sequence Number: 1
• Publication Date: July 27, 1988
• Content Type: REPORT

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Central Intelligence Agency
Washington. D. C.20SOS
DIRECTORATE OF INTELLIGENCE
?.7 July 1988
Prospects for_the Grou~of Eight
Summary
Latin America"s Group of Eightl--the most recent
regional effort to promote Latin unity--is quickly
gaining international attention and acceptance as a
voice for Latin policy views. In the short term, the
Group hopes to take steps to foster economic
integration in the region, to strengthen Inter-American
institutions like the OAS, and to diversify Latin
political and economic ties to developed nations and to
other regional groups. The Group is also grappling
with developing programs to cope with nontraditional
security threats such as illegal narcotics trafficking.
In our view, the Groug of Eight has several
characteristics that make it a more serious effort than
past Latin regional undertakings. M~ritber presidents
have disavowed a confrontational approach toward US-
Latin issues and forsworn stale Third World rhetoric..
Group members, in large part centrist and democratic in
orientation, have no intention a? incorporating
1 The Group of Eight is an offshoot of the efforts of the
Contadora countries--Colombia, Mexico, Panama, and Venezuela--and
the Contado-ra Support Group--Argentina, Brazil, Peru, and
Uruguay--to bring peace to Central America. The same eight
countries constitute the Group's membership, although Panama was
suspended in February 1988.
This typescript was prepared by (South
America-Caribbean Division, Office of African and Latin American,
Analysis. Comments and queries are welcome and may be directed
to the Chief, South America-Caribbean Division, ALA
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extremist, ideological governments like Cuba and
Nicaragua whose inclusion would be internally divisive
and probably would discourage the developed countries
from engaging in serious dialogue. Although the
Group"s highest priority %ssue--debt--places it at odds
with the United States, issues like the promotion of
democracy and human rights are also high on its agenda.
The Group is still in the early stages of defining
its structure and role, however, and serious
differences still exist between members ranging from
organizational questions to substantive policy
positions. Despite these problems, we believe the
Group of Eight has the potential to become an important
vehicle for unity and regional integration. The
ultimate success of the Group as a legitimate and
authoritative channel for brokering Latin policy
perspectives with international players, however, will
hinge on how the United States .approaches its formation
and reacts to its proposals.
Genesis and Objectives of the Group
The Group of Eight--formal~?ly called the Permanent Mechanism
for Latin American Political Consultation and Cooperation--was
launched in late 1986 as an effort to broaden political dialogue
among Latin nations and diversify Latinrties to other
industrialized countries and regional groups. From the
beginning, however, it was driven largely by Latin frustrations
over the perception that the crisis in Central America introduced
the East-West contest into the region and diverted US attention
away from the pressing social, political, and economic challenges
facing many Latin countries. Latin leaders saw a need,
therefore, for a concerted drive to shift Washington's focus
toward strengthening Inter-American institutions, accelerating
development, promoting economic and political integration, and
institutionalizing democracy. Over the longer term, the Group's
agenda emphasizes exploring new cooperative schemes to cope with
debt, while also attending such questions as narcotics
trafficking.
Several characteristics of the Group of Eight set it apart
from other efforts at Latin regional cooperation, such as the
Latin American Economic System (SELA); and, iti ot~r. view, make it
a more viable effort.
-- For the most part, the Group members are centrist and
democratic--an image it does not intend to jeopardize by
:incorporating extremist, ideological governments--
particularly the Cubans and Nicaraguans--whose
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participation would be internally divisive. and would
discourage moderate foreign interloriitor_s.
-- The Group has conscientiously avoided creating an anti-US
.image for itself. Although its highest priority issue--
debt--places it at odds with Washington, issues such as
the promotion of democracy and human rights and the
antinarcotics fight are also high on its agenda.
Instead, group members, acknowledging US economic
influence, are attempting to enlarge the dialogue with
Washington, hoping to reorient US pri.or.i_ties in the
region.
We believe Group of Eight founders perceive that Latin
America as a whole is a relatively low priority for the United
States as well as almost every other industrialized country and
regional grouping. They see their task as unifying, and
persuading the international community that they represent a
valuable partner from a trade, investment, or political
perspective.
Progress and Directions td Date
We believe the organizational design envisioned and the code
of conduct the Group has enforced so far will make-it more
effective than prior Latin unity efforts.- The Eight do not
intend to compete with or replace existing regional bodies--like
the Latin American Integration.Association--that already have
implementing bureaucracies. Rather, they seek legitimacy as an
authoritative group, along the lines of the industrialized
countries' "Big Seven," functioning at the presidential or
foreign minister level, while retainingfan informality and
flexibility lacking in more institutionalized forums. Decisions
are consensual, so that radical views are effectively buried.
Any one member-apparently can veto Group action--an arrangement
that may hinder decisionmaking but generally will promote
compromise and moderation.
The Presidents recognize that success of their mechanism
depends to a large degree on their personal chemistry. At their
first summit, held in Mexico in late November 1987, many noted
they were pleased simply to have met to discuss their own agenda
and not at the behest of the United States or an international
organization. They were able to air and hear views on a range of
economic issues, while also discussing regional security,
strengthening the OAS, narcotics trafficking and terrorism, and
Central America. They enjoyed the exercise, underlining their
status as equal peers by acclaiming the President of tiny Uruguay
for his leadership role and announcing that Uruguay would host
the 1988 summit. Group members forcefully made their most
important point--that problems of debt and development are
undermining democracy--without shrill rhetoric aimed at developed
countries or international banks and financial- institutions.
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Since the November Summit .the Group, despite the Panama
situation, has pushed ahead toward developing conr.rete
initiatives--particularly in the economic realm--and gaining
international respectability. They focused a two day ministerial
meeting last month in Mexico on economic integration, technical
and industrial projects, and cultural agreements, enlisting
representatives from several regional organizations--the Latin
American Integration Association (ALADI), the Latin America
Economic System (SELA), the Economic Congress on Latin America
and the Caribbean (ECLAC), and the Inter-American Development
Bank (IDB)--to participate. The foreign ministers also discussed
contentious issues such as readmitting Panama, reacting to the
coup in Haiti, and admitting Ecuador as a member, taking pains
not to allow them to create any rifts.
We believe the Group will want to concentrate on economic
issues at the next summit, scheduled for late October in Uruguay,
but also to elaborate on other subjects under review. We believe
the Presidents now feel a need to move beyond the discussion of
goals and, relying on the work done at the ministerial meeting,
announce some sound, attractive proposals that Latin nations can
act on. Press reports suggest initiatives are most likely in the
areas of industrial coproduction schemes, technology transfer and
intra-regional trade. The Latins also may begin to brainstorm on
issues like illicit drug trafficking and terrorism as dangers to
democracy and polio-cal stability. Although they continue to'
argue that drug-consuming countries need to take more aggressive
action to stymie demand, Latin leaders increasingly recognize the
threat posed by the narcotics industry to their own societies.
Group of Eight sponsorship could ,lead to a more serious regional
counternarcotics effort.
The Group of Eight is making measurable progress on its
other major front--gaining international credibility. As they
did last year, the foreign ministers apparently will meet with
their European Community counterparts at the UN in September; the
two appear close to institutionalizing annual discussions on debt
and trade. The Eight are pursuing similar meetings with the Arab
nations, Japan, the Organization of African Unity (OAU), the
southeast Asian bloc (ASEAN), and the Nordic Council. Earlier
this year the foreign ministers held discussions with Canadian
officials in Montreal, where they presented their views on the
relationship between debt.and democracy in advance of the Toronto
Summit. Although several member countries were anxious to hold
similar meetings with Secretary Shultz, we believe the Group may
now try to establish working relationships with other nations and
groupings before seeking the added legitimacy that talks with
Washington would confer.
Stumbling Blocks to Further Consolidation
The Group of Eight is still defining itself in terms of
structure, guiding principles, and longterm role. US Embassy
reporting from the region indicates that substantial differences
of opinion exist--even on fundamentals such as how meetings are
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called. Several members, for example, hastily called for a
meeting in early June to discuss with Panama_ a US proposal for
Latin mediation. Brazil refused to attend, presumably because it
felt such a role would constitute intervention in. Panama's
affairs and that a sudden meeting would contravene the bedrock
objective--to break the habit of reflexively responding to US
initiatives. In another case, at the first summit last November
Panama broke two important Group principles--not to introduce
bilateral conflicts and not to single out the United States for
criticism--and the temptation will remain strong for others to do
the same as bilateral disputes with the US inevitably arise.
Significant policy differences on specific issues remain a
major hurdle. Following the Acapulco summit, for example,
Colombia--which strongly opposed the more radical positions of
other countries on debt policy at the summit--issued a communique
designed to reassure creditors that Bogota is a constructive,
moderating influence on the other countries. Such internal
policy disputes will become hard to handle if the Group reaches
the point of issuing specific recommendations for policy action
or moves to implement steps toward political and economic
integration. An additional challenge to Group unity is. the
possibility--perhaps likelihood--that competing subgroups will
emerge or that one or two countries will be consistently
isolated. The efforts by foreign ministers from Venezuela,
Argentina, Brazil, and Uruguay to coordinate a position on
readmitting Panama to the Group before the June ministerial in
Oaxaca suggest these trends may already be developing.
Panama continues to pose an organizational and image problem
for the Group. In our view, the suspension of Panama following
Noriega's ouster of President Delvalle gave several countries--
Uruguay, Argentina, and Venezuela in particular--the opportunity
to demonstrate their claims to US officials that the Group was
insistently democratic and would not reflexively oppose US policy
in the region. Perhaps more important, the action showed the
Group is not likely to be dominated by Mexico and Peru.
Nonetheless, some members, including Mexico, Peru, and apparently
Brazil, believe Panama's suspension amounted to intervention and
they are sympathetic to reintegrating Panama.
The issue of admitting new members is also likely to be
divisive. -Both Bolivian President Paz Estenssoro and President-
elect Borja of Ecuador have requested membership.
If they open the door to Ecuador and Bolivia based on their
democratic credentials the Group would have to include Central
American and English-speaking Caribbean countries. Most argue
that the success of the Group hinges heavily on its informal
structure and personal chemistry which such expansion-could
poison. On the other hand, others note that refusing to expand
risks alienating fellow Latin leaders and opening the Group to
charges of wanting to dominate regional affairs.
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Leadership transitions also are likely to slow the Group's
progress. Mexican President de la Madrid, Venezuelan President
Lusinchi, and possibly Argentine President Alfonsin will be out
of office before the anticipated 1989 summit. Within two years
all eight countries are likely to hold presidential elections.
Firebrand populists like presidential candidates Carlos Andres
Perez in Venezuela, Carlos Menem in Argentina, Leonel Brizola in
Brazil, or Alfonso Barrantes--a Marxist--in Peru could break the
guidelines of decorum that, in our view, make the Group
effective.
Outlook and Implications for the United States
As a Latin American unity movement, the Group of Eight holds
promise, its progress so far reflecting growing realism among
regional leaders. They recognize that their serious domestic
economic and political challenges require innovative, well
considered policy action in lieu of stale Third World rhetoric.
These leaders increasingly recognize their own accountability at
home for solving those problems, and the Group is likely to
become an important intraregional mechanism for coping with them.
They also know they will require foreign assistance--a need
dictating cooperative, not confrontational foreign relationships.
This attitude underscores their seriousness about seeking Latin
American unity and altering the style and substance:bf relations
with the developed world. The presidents' direct involvement,
personal rapport, and sensitivity to pitfalls will help the Group
bid for recognition as a prestigious interlocutor for Latin
American interests over the next few years. Ultimately, however,
legitimacy and success of the Group in the international realm
will depend on how the United States approaches i.ts consolidation
and reacts to .its proposals.
We see opportunities for the United States in engaging the
Group and rewarding its emphasis on a mature, serious exchange of
views. In particular, such a dialogue could open the way for
better cooperation on defending democracy, promoting human
rights, and blunting the growth of the narcotics industry--areas
where the Group's and Washington's goals coincide. The Group of
Eight mechanism could provide a high-level channel for Washington
to forcefully express its views and press for such cooperation,
while whittling away Latin foreign policy tenets like
nonintervention and self determination that limit cooperation.
Reinforcing Group ground rules could also help dampen anti-US
rhetoric from leaders like Peruvian President Garcia who have not
pursued a serious dialogue at the bilateral level. Engaging the
Group early on and reinforcing its nonconfrontational approach
would help set a tone for Group-US interaction before new Latin
leaders are elected and become members. Moreover, the Group--
which may eventually push to reintegrate Cuba into the OAS--
offers the US a major, new channel for dialogue that- excludes
Cuba, as well as Nicaragua.
On the other hand, refusal by Washington to an eventual
Group of Eight bid for serious talks would raiise a backlash in
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Latin America, damaging U5 relations with the region,
particularly if, as we expect, it becomes accepted both within
the region and internationally as a credib]_e representative of
mainstream Latin thinking. By ignoring it, the tTS would foster
Latin perceptions that Washington views t]ie region from only an
East-West perspective and is cynical about eronomir, development
and democracy in the region.
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