“Nothing is more emancipating than the fraternity of nations,” the presidents of Argentina and Brazil declared earlier this year, “coming together from the depths of history to make the future theirs.” This sonorous language—of emancipation and brotherhood—evoked the aspirations of South America’s great independence hero, the statesman Simón Bolívar. The reality was more humdrum: a fancy way of saying they’d like to create a common currency, known as el sur.
The plan for a currency union is merely the latest in a long history of treaties and proposals for creating a closer bloc in the region. “The ideas of Latin American integration are so old,” Jamil Mahuad, a former president of Ecuador, told me. “It’s a big dream, but a dream that has always fallen short.” During Mahuad’s term in office, in the late 1990s, the country faced an economic crisis so severe that the local currency collapsed. His solution was a desperate one: dollarization—in a way, the antithesis of el sur (literally, “the south”). In effect, Ecuador joined someone else’s currency union, but without any of the privileges of membership.
