Customs Nomenclatures and Techniques________________________________________________________________________Latin American Integration AssociationALADI I.U.P. CLASS: CUSTOMS NOMENCLATURES AND TECHNIQUES GROUP MEMBERS: Guayaquil - Ecuador2003 - 2004Latin American Integration AssociationALADI________________________________________________________________________INTRODUCTION
ALADI replaced the Latin American Free Trade Association (LAFTA; Asociación Latinoamericana de Libre Comercio), which had been established in 1960 with the aim of developing a common market in Latin America. The scheme made little progress, and ALADI was created with a more flexible and more limited role of encouraging free trade but with no timetable for the institution of a common market. Members approved the Regional Tariff Preference scheme in 1984 and expanded upon it in 1987 and 1990.


COMPOSITION


11 member countries: Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Mexico, Paraguay, Peru, Uruguay, and Venezuela


There are 15 observer countries: China, Costa Rica, Cuba, Dominican Republic, El Salvador, Guatemala, Honduras, Italy, Nicaragua, Panama, Portugal, Romania, Russian Federation, Spain and Switzerland


There are 8 observer organizations: Inter-American Development Bank (IaDB), UN Economic Commission for Latin America and the Caribbean (ECLAC), the Organization of American States (OAS), the UN Development Programme (UNDP), the European Communities (EC), Latin American Economic System (SELA), Andean Development Corporation (CAF), and Inter-American Institute for Cooperation on Agriculture (IICA).


STRUCTURE


The Council of Ministers of Foreign Affairs is the highest organ of the Association and is responsible for the adoption of its top policy guidelines. It is composed of the Ministers of Foreign Affairs of the eleven member countries, except when a Minister other than the Foreign Minister is in charge of ALADI's affairs in a particular country.


The Evaluation and Convergence Conference is composed of plenipotentiaries of member countries. The Conference examines the operation of the integration process, evaluates results of preferential arrangements, and recommends studies to be undertaken by the Secretariat.


The Committee of Representatives is composed of a Permanent Representative of each member country and his Deputy, and is the permanent political body of the Association. The Committee promotes the conclusion of agreements, adopts measures necessary to implement and regulate the Treaty, and convenes the Council and the Conference.


The Secretariat, headed by a Secretary-General who is elected by the Council for a renewable three-year term, carries out ALADI's technical and administrative tasks. The Secretary-General participates in the work of the Council of Ministers, the Conference, and the Committee.


HISTORY


In 1969, with a view to taking the integration process further, among other things, the Andean countries decided to carry out a subregional agreement without withdrawing from LAFTA. This entailed negotiating an agreement that formed the first step toward making the Association more flexible while slowing the multilateralization process. The possibility of incorporating flexibility into the principle of multilateral action arose when new provisions were added to the GATT agreement, including one that recognizes nonreciprocity in trade relations among developing countries as a principle compatible with the world organization's rules.


In 1980, the same eleven countries approved the treaty establishing ALADI to take the place of LAFTA . The treaty is a flexible instrument that enables easy access for countries wishing to join and also allows a wide range of agreements to be concluded between members and between members and nonmembers in the region, without concessions to the other partners of the Association. Only the free trade agreements between ALADI members and developed countries --for example, Mexico's membership in the NAFTA-- are subject to Article 44 of the treaty, which specifies that the advantages granted by the new agreement must be extended to the other members of ALADI

TREATY
The treaty aims at progressive "multilateralization" by specifying that the partial agreements (i.e., those including only part of ALADI membership) must be open for other member countries to join, following negotiations to that effect, and that they must contain clauses conducive to convergence; however, the very general nature of the provisions in both the treaty and its implementing regulations has resulted in the partial agreements only mentioning this possibility. In addition, resistence to the official commitment to accentuate the differential treatments for some countries is another factor that is gradually undermining the Association.


In its early years, ALADI concentrated on renegotiating the 20,000 concessions previously agreed to under LAFTA, two thirds of them multilateral in nature and the rest of them advantages granted to the relatively less developed members that could not be extended to other countries. As a result, a