Rebuilding the Central American Bloc in the 1990s: An Intergovemmentalist Approach to Integration

In the 1990s, following the success of the Esquipulas peace process to end the civil wars, the Central American governments turned their attention to rebuilding and redefining integration. This chapter looks at the process of reorganising regionalism in Central America as a result of strategies pursued by the governments in order to boost both the process of regional integration and the internationalisation of the economies of the region. This reorganisation of regionalism includes the reform of the Central American Common Market (CACM), and the reshaping of the process of integration in general, with the establishment of SICA (System of Central American Integration) in 1991. The focus of the chapter is on the process of institutional reform, bargaining and the strategic interactions of the member states of the CACM (Costa Rica, Guatemala, El Salvador, Honduras and Nicaragua) which led to the re-launch of regionalism in the 1990s under SICA. The main contentions put forward here are: That the rebuilding of regionalism in Central America reflects governments’ preferences constrained domestically by their political economy (distributional conflicts) and externally by global pressures and the desire of the governments to integrate their countries into the world economy. In the rebuilding of regionalism, governments’ preferences and interests remain a central feature, which determines the scope and reach of integration. But the external dependence of the region also instigates pressures on the interstate bargaining for integration. Although the governments embrace integration within the context of open regionalism and globalisation, there still exists a conceptual divide within the region. As a result, variable geometry, rather than a solid and far-reaching process, defined the nature of integration in the 1990s. This divide seriously undermines the pursued goal of integrating the region effectively into the world economy.