The “Southern Common Market”, better known as Mercosur, is the leading Ibero-American trade bloc. Focused specifically on the so-called “Southern Cone” of South America, it brings together Argentina, Brazil, Bolivia, Paraguay, and Uruguay. Its origins are inextricably linked both to the context of regional “redemocratization” (after periods of dictatorship, particularly in Brazil and Argentina) and to the triumph of liberalism at the dawn of the “End of History” and the post-Cold War “New World Order.”

In the logic of that era, the formation of blocs united by “free trade agreements” was seen as the natural solution to the low economic efficiency that had led many economies to stagnation. It also carried the mark of “historical confirmation”—since, with the fall of the USSR, not only was the geopolitical victory of the U.S. cemented, but so too was the superiority of liberal capitalism in its new form.

Thus, it seemed natural for countries in the region to submit to the “Washington Consensus”, a neoliberal set of principles embraced by most Ibero-American nations. And there is no denying that Mercosur’s birth is tied to this adherence to the Washington Consensus. And that is precisely where its limitation lies.

Ibero-American integration is a topic that resurfaces frequently, especially in recent years, as an international trend toward forming regional blocs has solidified. And whenever the issue is revisited, Mercosur is mentioned as the seed of “something.” Yet it never progresses beyond that. The reality is this: economics alone is not a sufficient foundation for a regional integration project. Economic interests do not always align with geopolitical interests, meaning one does not necessarily translate into the other.

No one denies that Mercosur has been beneficial for the Brazilian economy, particularly for the industrial class. Mercosur destinations account for a significant portion of Brazilian exports and constitute the second-largest export bloc in terms of job creation in Brazil, second only to exports to the U.S.

However, countries in the region are undergoing a process of deindustrialization, which ultimately limits the bloc’s potential. Moreover, its main initiatives seem focused on securing free trade agreements with much more industrialized regions, such as the infamous EU-Mercosur Agreement. If approved by the Europeans, this deal will open the gates of the region’s countries to European industrial goods, further harming South America’s already weakened industry.

Under these conditions, it is necessary to question whether Mercosur has exhausted its potential and whether the time has come to consider some other platform for Ibero-American integration. This is not about advocating for Mercosur’s dissolution without proposing a replacement. On the contrary—Mercosur is useful, and as long as there is no superior alternative, it is better that it continues to exist.

But if the formation of blocs has become an indispensable act to safeguard sovereignty in today’s contentious geopolitical landscape, then Mercosur must be surpassed by a structure that goes beyond economics—one that, even within the economic sphere, prioritizes continental self-sufficiency over an insistence on globalized international trade.