This two sections document analyzes the most relevant aspects of Latin America’s and the Caribbean’s external relations. The first section examines the region’s foreign policy in general terms , emphasizing the financial crisis’ main traits and effects from the perspective of Latin America and the Caribbean, including the role of international financial institutions. The second section focuses on three negotiating fora in which the countries of the region participate: the FTAA process, relations with the European Union and the WTO’s next "Millennium Round". The issue of Latin America’s and the Caribbean’s external relations is under constant examination by SELA’s Permanent Secretariat. The factors influencing the dynamics of the region’s external relations are subject to constant changes, as became apparent throughout 1998, thus, they require a permanent evaluation, examination and follow-up.

In this article the author argues that in spite of being the world’s most powerful country, in an economic, cultural and political sense, the USA, which since 1898 had exercised an almost hegemonic leadership in the region, is no longer capable today to impose its will upon its neighbors. Since the world has changed enormously within the last century due to technology and communications, the traditionally main areas in the inter American agenda, such as ideological, geopolitical or security issues, have lost ground to more practical concerns such as trade and finances. Therefore, the author estimates that in the coming years Microsoft will play a more important role than the Marines in hemispheric relations , the US Commissioner for Immigration and Naturalization will be more important than the Secretary of State and CNN more than the United States Information Service, to cite but a few examples.

In June of this year the European Union and Latin America will participate in a Summit that will offer a magnificent opportunity to strengthen relations between the two regions and set the basis for bilateral relations in the new millennium. This article reviews the evolution of EU-LAC relations since 1970, highlighting the main issues that have determined each region’s position regarding the other and the different steps taken that have insured progress in the trade, economic, industrial, cultural and scientific and technological areas.

In this article, Japan’s former Minister of Finance reviews the situation of the Asian countries -which in the last years had achieved a 10% growth rate- before the outbreak of the financial crisis in July 1997. In the author’s opinion the crisis can be divided into two stage: the first is characterized by mostly monetary problems and the second by economic problems compounded, in some case, by political and social conflicts. He also refers to the measures the Japanese Government has adopted to rescue the economy and to the key role played by popular support of this measures to insure their success.

According to ECLAC’s Executive Secretary, the international financial crisis will have a lingering effect on the economy of the countries of Latin America and the Caribbean. It is expected that during the 1990’s the region’s economic growth will be slightly above 3% per year, lower than the average 5.5% growth rate registered during the 1960’s and 1970’s. However, the crisis has also taught us some lessons that we will need to take into account in the future. Of these lessons, the most important, in his opinion, is that we must learn to administer the periods of economic boom "because managing economic booms is preventing crises".

Even though they belong to the same region,Latin American and Caribbean countries do not always share the same interests when negotiating with third countries, groups of countries or multilateral organizations. According to Barbados’ former Prime Minister Harold Bernard St.John, nor do they always succeed in presenting a common position in negotiations in those fora. However, countries of the region may , and it is fundamental that they do, adopt a common position to insure "the survival of Latin America and the Caribbean in this globalization era", on issues such as tourism, transportation, the protection of the Caribbean Sea, the reform of multilateral financial institutions and the role countries may play in such reforms.

This paper discusses the "Canadian model" of trade negotiations with the continental giant, which started the NAFTA process. Its objectives are twofold and interrelated. On the one hand, it provides a brief analysis of the external and internal factors that led the Canadian Government to propose free trade negotiations to the world’s main economic power and of the role the different economic and academic sectors and politicians played in the debate on the so-called "second option". On the other hand, it analyzes how the Canadian government successfully handled the issue of asymmetric interdependence and obtained its goals in the bilateral negotiations following a whole gamut of negotiating techniques, in spite of the considerable difference of "structural aggregate resources and potentialities" with its neighbor. The fundamental lesson we learn from this analysis is that the results of the negotiations on the Canada-USA Free Trade Agreement depended on each side’s skill in applying its political power on each specific area of the negotiations, in order to obtain its objectives. This research was carried out between 1995 and 1997 and it was financed by the Canadian Government.

Trade liberalization implies costs and benefits for all countries participating in that process. Thus, negotiations on the Free Trade Area of the Americas (FTAA) represent a major challenge since 34 countries of the hemisphere, with very different economic, social and technological development levels, will need to harmonize positions to obtain the most at the least possible cost. This article examines the positive and negative effects the FTAA may have on each country of the hemisphere.

This document was prepared by SELA’s Permanent Secretariat on the occasion of the Second Summit of Heads of State and Government of the Association of Caribbean States (ACS) held on March 24 and 25 in Santo Domingo, Dominican Republic. The document makes a number of suggestions regarding the creation of the Free Trade Area of the Great Caribbean proposed within the ACS, taking into account the different levels of interest and political will within the countries members of the organization and their differences in size, production levels and export capacity. One of the benefits Caribbean nations would derive from such an agreement is that they would be better prepared to face the next round of negotiations within the WTO and the current one on the Free Trade Area of the Americas (FTAA).

There is no doubt that electronic trade is riding the wave. Young people, adults, professionals, researchers, executives, housewives and even governments use the so-called "information highway" to acquire the goods and services they may need at more convenient prices and without leaving their homes or work place. Nevertheless, as the author of this article points out, because of the enormous technological and political speed at which the USA, Japan and some European nations are reaching a leading position in the production and sale of computer hardware and services and in the establishment of norms regulating the trade of modern information technologies, developing countries such as those in Latin America and the Caribbean run the risk of being left out.