Will Mexico join Mercosur?

Former Mexican President Vicente Fox once vowed that a Free Trade Area of the Americas would be formed 'with or without Mercosur', a common market composed of Argentina, Brazil, Uruguay and Paraguay. But there appears to be a thaw in relations under his successor, Felipe Calderon, with both Argentina's President Nestor Kirchner and Brazil's Luiz Inacio Lula da Silva visiting Mexico in the past two weeks. 

Kirchner invited Mexico to join Mercosur. Lula stopped short of doing so, urging Calderon to look south and suggesting that Brazil -- whose bilateral trade with Mexico reached nearly 6 billion dollars last year -- could be Mexico's passage to Mercosur.  Calderon played his part, saying that Mexico may be located in the north, but its heart was in the south and in Latin America.

Mexican membership of Mercosur is hardly a novel idea: there were overtures to incorporate the country in 2004, although they foundered on Mexico's membership of NAFTA and Fox's increasingly frosty relations with Lula and Kirchner.  Both Lula and Kirchner now appear to regard Calderon as an important ally to strengthen their own positions in the region, and Latin America's three largest economies together account for some three quarters of regional GDP.  Both Argentina and Brazil have recently signed new cooperation agreements with Mexico on a range of issues including agriculture and energy -- in particular, biofuels.

Yet, the incorporation of Mexico into Mercosur does not seem to be a short-term prospect.  Apart from the obstacle represented by its NAFTA membership, Mexico still jostles with Brazil for regional influence, and the two countries disagree on key issues such as reform of the UN Security Council.  Also, recent stumbling blocks to the -- more advanced -- entry of Venezuela into Mercosur make any fast track for Mexico unlikely, especially given ideological tensions between Calderon and Venezuelan President Hugo Chavez (for whom closer Brazilian and Argentine ties with Mexico represent a potential curb).  Perhaps most importantly, Mercosur is a fractious and politically vacuous entity that has thus far failed to live up to its ambition of forming a regional common market, and may be more attractive as a market rather than a formal alliance for Mexico.