Social and Solidarity Economy in South American regional governance

Abstract

The article analyzes the scaling up of the Social and Solidarity Economy (SSE) agenda in the regional integration processes of Union of South American Nations (UNASUR) and MERCOSUR. We ask how the SSE is being used in processes of regional policy cooperation and what implications this has for the construction of regional governance frameworks supportive of social development. Our argument is that the regional processes in the contexts of UNASUR and MERCOSUR adopt a narrow concept of SSE that defines it as a social policy instrument to combat poverty. This limits the transformative potential of the SSE agenda, a more expansionist interpretation of which would otherwise herald the strengthening of socio-productive practices as an alternative to extractivist development in the region.

Keywords

Development MERCOSUR regionalism Social and Solidarity Economy social policy transnational social movements UNASUR

Introduction

The suspension of the Free Trade Area of the Americas (FTAA) negotiations at the Mar del Plata summit in 2005 marked the end of the neoliberal consensus that had shaped the agenda of regional integration in Latin America since the mid-1990s. This set in motion a wave of regional integration schemes led by the convergence of left-of-center governments that came to power capitalizing on the social discontent and resistances to the neoliberal model integration (Saguier, 2007, 2012a). The leadership role of Presidents Hugo Chávez from Venezuela, Néstor Kirchner from Argentina, and Inácio Lula da Silva from Brazil was determinant in the crucial early stages where region-building was prioritized as part of these governments’ foreign policy priorities. The Bolivarian Alliance for the Peoples of Our America (ALBA), the Union of South American Nations (UNASUR), and later the Community of Latin American and the Caribbean States (CELAC) were outcomes of this new wave of ‘post-hegemonic’ regionalism, characterized by the exploration of agendas and mechanisms of integration beyond market integration (Briceño-Ruiz and Hoffmann, 2015; Riggirozzi and Tussie, 2012). Even the Southern Common Market (MERCOSUR) adopted a new role as a political bloc moving beyond its previous commercial identity (Burgess, 2016). These regional schemes opened opportunities to explore policy convergence on a number of development-related issues where there had not been a history of sustained cooperation (Bianculli and Hoffmann, 2015; Mejido et al., 2010; Riggirozzi, 2014; Vivares, 2014). This is the case of the Social and Solidarity Economy (SSE) agenda, which is the focus of this article.

The exploration of a development agenda in a regional setting exposed a set of underlying tensions. First, there was no agreement among governments and societies on the economic models and development perspectives that could be generalized as a common regional approach. The countries that make up MERCOSUR (and associated states) favored a neo-developmental approach with an active role of the state in policies to foster industrialization, economic diversification, trade protectionism, internal markets, and ultimately regional value chain integration. Others, such as those participating in the Pacific Alliance, prioritized a neoliberal approach based on economic specialization in primary sectors, a free trade policy approach, and a business-oriented relationship with Asia (Quiliconi, 2014; Pinheiro Guimaraes, 2012; Vadell, 2013). Although this dichotomy between ‘developmental’ versus ‘market’ approaches to state international strategies can be questioned as too simplistic (Mejido et al., 2010), the point is that there was no such a thing as an overarching regional consensus of what a development agenda for interstate cooperation stands for.

At the same time, the meaning and scope of ‘development’ became a subject of increasing contestations from social groups that began to problematize the so-called benefits of an economic growth based on extractive sectors in terms of its socio-environmental negative implications. While some countries managed to attain significant progress in securing social inclusion through redistributive policies – notably in Argentina, Bolivia, Brazil, Ecuador, Uruguay, and Venezuela – the negative socio-environmental implications of this pattern of growth also became increasingly apparent. Various patterns of exclusion and harm were exposed, such as the detrimental effects of industrial agricultural practices on human health and the environment and its relation to a new wave of land-grabbing practices (Borras et al., 2012), mining (Saguier and Peinado, 2016; Svampa, 2011), and infrastructure projects associated with extractive industries such as hydroelectric dams complexes (Saguier, 2012b), among others. In other words, the advancement of (resource) extractivist policies and practices enabled growth regimes based on the disentitlement of social rights of social sectors and the commodification of nature. This phenomenon of ‘accumulation by dispossession’ (Harvey, 2004) was a structural feature that has affected at different rates and intensity all South American countries, regardless of the political ideology of their governments (Bebbington, 2012).

These ‘development’ tensions set the context in which the SSE agenda enters the regionalism process. It is thus not surprising that there is not a single and agreed definition of SSE. Indeed, the extent to which different economic practices constitute alternatives to dominant economic organizing is itself a subject of internal contestation within the broad field of progressive social and political forces. Yet, as a general definition, SSE refers to ‘forms of economic activities that prioritize social and often environmental objectives, and involve producers, workers, consumers and citizens acting collectively and in solidarity’ (Utting, 2015: 1). The scaling up of an SSE agenda in South American regionalism is unprecedented in the politics of regional integration. As Utting (2015) explains, there has been growing momentum in the scaling up of SSE internationally (p. 3). The global financial crisis, its impacts on employment, and the United Nations (UN) Millennium Development Goals (MDGs) process have also contributed to making SSE an increasingly relevant agenda in the international policy arena (Red Intercontinental de Promoción de la Economía Social Solidaria [RIPESS], 2014; United Nations Research Institute for Social Development [UNRISD], 2016: 116).

In this article, we focus on the scaling up of the SSE agenda in UNASUR and MERCOSUR. The scaling up of an SSE agenda results in denser patterns of interactions between social and solidarity practices with the state and with the dominant corporate economy. This has complex effects on SSE, some enabling but also co-opting, debilitating, or contradictory ones. In other words, while the mainstreaming of SSE as a policy agenda may foster the growth of SSE, it could also lead to deviation from its core principles, as well as result in a relation of dependency, co-optation, instrumentalization, bureaucratization, and hierarchical decision-making (UNRISD, 2016: 121). Considering such challenges, we ask how the SSE has been scaled up in UNASUR and MERCOSUR as regional cooperation policy, and what implications has this had for the exploration of a development agenda of regionalism?

To address these questions, we focus on two levels. First, we examine the particular SSE practices and agendas that have been incorporated as policy-relevant practices for regional cooperation. Second, we consider how SSE practices have been institutionally embedded in the regional cooperation framework. We have not included the ALBA process. ALBA proposed the Bolivian Initiative of a Peoples Trade Agreement (TCP),¹ a regional mechanism that could have been a major contribution to SSE, but TCP never gained momentum. Instead, UNASUR and MERCOSUR took the leadership, setting out to achieve more modest SSE goals within the region. We also recognize that the scope and limitations of the SSE policies and programs are equally influenced by national and regional policies undertaken in other areas. One such example is the MERCOSUR Family Farming process (REAF). We therefore focus exclusively on programs and initiatives that are explicitly defined as SSE.

Our main claim is that the incorporation of an SSE agenda to the UNASUR and MERCOSUR processes opened the possibility of exploring new cooperation mechanisms for social inclusion. The scaling up process privileged a narrow conception of SSE, in particular those socio-productive practices that favored employment generation in economically vulnerable sectors of society. While promoting social inclusion, this approach to SSE sidestepped many of the questions that more radical SSE practices raise concerning the limits of current economic development paradigms underlying neoliberal and neo-developmental policies. At the same time, our claim does not lose sight of the fact that, in some cases, regional processes are the only spaces available to advance and explore progressive concepts such as SSE (Fitzgerald and Thorpe, 2005; Mejido et al., 2010).

A constructivist assumption underlying our analysis is that the incorporation of the SSE in itself constitutes a process by which a particular discourse of SSE is produced and diffused. In other words, SSE is produced as a specific discursive terrain that sets the parameters for future pathways to explore the regionalization of a development focused agenda. In this respect, the scaling up of SSE in a regional setting is a constitutive of a particular dimension of post-hegemonic regionalism. This is the case in as much as it experiments with the boundaries of political space for policy coherence and coordination.

The argument is organized as follows. In the first section we present the origins of the SSE as a framework concept that brings together different sources and experiences of community-based economies centered on principles of reciprocity. We outline two coexisting approaches to SSE that constitute distinct discursive spaces to address the relationship between regionalism and development. In the second section, we survey the SSE programs and instruments in UNASUR and MERCOSUR to discuss their main characteristics and the type of socio-productive practices that are incorporated as SSE. We also look at the regional governance mechanisms that drive this agenda. In the conclusion, we reflect on the implications of the treatment of SSE in these regional processes in relation to the prospects for building integration policy frameworks for development.

Actors, ideas, and scope of the SSE

The SSE is a new concept that draws on different survival and resistance strategies of social groups that have historically been excluded from the mainstream of ‘development’. SSE is a way people ‘excluded and impoverished by the capitalist system’ are solving income and employment problems (Montoya, 2012: 21). As all concepts, SSE has its own historicity. The specific configuration of SSE in Latin America is the expression of the legacies of social struggles for livelihood, fused with the European legacy of SSE, which dates back to the 19th century (Laville, 2015). Neoliberal policies in Latin American helped to rekindle practices of production, exchange, consumption, and solidarity finance. The social solidarity economy values work over the capital. Its aim is to meet the needs of individuals and communities rather than trying to maximize profits or financial gains. Economic organization guided by solidarity principles is based on a model of democratic decision-making system and a participatory and transparent management to ensure collective governance and responsibility as well as ongoing mobilization to ensure its success.

The SSE appears in policy fields as a ‘bridging frame’ concept (Snow et al., 1986) which articulates different practices and identities of social groups that have had to devise various strategies of survival to ensure their livelihoods at time of adversity, but it also works as political conception to attain autonomy from the market and the state. Since the early 20th century, the tradition of European cooperativism has influenced a Latin American cooperative movement. A recent Latin American expression of this is the recovered factory movement initiated by laid-off workers during the 2001 crisis in Argentina (Itzigsohn and Rebón, 2016). Other survival strategies include barter markets and the use of social currencies. The cooperative movement in Latin America participates in the Cooperative of the Americas network – the regional representative of the International Cooperative Alliance (ICA).

Indigenous cultures bring their knowledge of grassroots economic organizing based on principles of reciprocity that converge in the broad concept of SSE (Álvarez Quispe, 2012). The Buen Vivir and Vivir Bien concepts provided the legal, ethical, and moral foundations of the new constitutions of Bolivia and Ecuador as well as a foundation for community-based solidarity economies (Gudynas, 2011; Huanacuni Mamani, 2010). Likewise, the feminist movement articulated in transnational networks, such as the International Gender and Trade Network (IGTN) or the Latin American Network of Women Transforming the Economy (REMTE), also contributed to the conceptual developments of the SSE, most notably the notion of the economy of care (Razavi and Staab, 2012). Moreover, the peasant movement – represented regionally in the Latin American by the Coordination of Rural Organizations (CLOC) and globally in Via Campesina – added the food sovereignty agenda and the defense of agro-ecological production (Barkin and Lemus, 2014). The SSE perspective connects such diverse expressions of socio-productive practices based on principles of reciprocity and solidarity.

Transnational networks of social and academic organizations have been instrumental in the articulation and diffusion of an SSE language that can be operational in development policy fields and also in brokering and translating between different traditions and social and political solidarity economies in the making of a common language. The Intercontinental Network for the Promotion of Social and Solidarity Economies (RIPESS) is prominent (in Latin America and the Caribbean, RIPESS-LAC brings together two Latin American networks, seven national networks and 10 sub-national or national organizations and has a presence in 12 countries). RIPESS also participates in the World Social Forum process. There is also the Network of Latin American Researchers of Social Solidarity Economy (RILESS), a network of researchers committed to developing conceptual debate and research on the solidarity economy from a Latin American perspective. Some networks such as the Latin American Network of Community-based Marketing (RELACC) prioritize capacity-building and the visibility of SSE producers, while others engage in regional governance issues as those that participate in the MERCOSUR Social and Solidarity Program.

Notwithstanding its heterogeneity of visions, SSE networks have made significant progress in opening spaces in international political processes. For instance, RIPESS coordinated a global consultation to formulate recommendations to the UN Sustainable Development Goals, a process that required consensus building among its members and which resulted in a set of sustainable development indicators infused with an SSE perspective (RIPESS, 2014). The incorporation of SSE ideas and practices into South American integration processes opened the opportunity to stimulate the exploration of regional frameworks of policy cooperation with the experiences and ideas of social and solidarity practices. However, scaling up SSE as a policy discourse is not a linear and univocal process. The plasticity of the SSE concept allows for a partial selection of what constitutes SSE, highlighting some aspects while neglecting others. In this respect, the scaling up of the SSE agenda in the UNASUR and MERCOSUR processes has involved the political construction of the SSE as a regional policy discourse. Below, we identify two archetypal conceptions of SSE relevant to the regional scaling up of SSE.

SSE as alternative economic paradigms

This first conception understands the SSE as a transition to alternatives to the current capitalist economy. In an explicit criticism of the prevailing orthodox economic visions, SSE engulfs a wide array of socio-productive practices that share a normative commitment to the construction of post-capitalist ways of thinking and organizing the economy. This includes community activities and organizations of associative and cooperative nature and other collective forms created to meet the employment needs and welfare of the people’s and citizens’ movements aimed at democratizing and transforming the economy (RIPESS, 2015).

The construction of alternative economic paradigms requires that social and economic organization is centered on the ethical principles of solidarity and reciprocity between people and the environment. This supposes overcoming competition as the organizing principle of the market economy. Likewise, it questions the materialist assumptions of conventional economic thinking from which a hegemonic notion of ‘wellbeing’ is defined as material accumulation. This view of SSE seeks to overcome the dominant ideology of consumerism, often inscribed in the notion of unlimited growth which is seen as contradictory to ecological sustainability. The transformation to alternative economic paradigms is about the overcoming instrumental rationality – centered on capital accumulation – for a reproductive rationality centered on life (Coraggio, 2011). A reproductive rationality is aware of the codependent relationships between people and between people and the planet. Its emphasis is on life-generating and sustaining systems, understood as self-contained, entropic processes. This perspective endorses a holistic view of society–nature relationships in line with a deep ecology perspective. Notions of Buen Vivir/Vivir Bien, agroecology, food sovereignty, communal resource governance, and eco-feminist perspectives often resonate with this view of the SSE economy.

Moreover, this radical view of SSE is aligned with the post-development critical perspective which highlights the disciplinary functions that development discourses have in the world’s peripheries as an entrenched postcolonial structure (Escobar, 1995). In Latin America, this view has been largely shaped by social movement struggles against extractive industries and policies (Gudynas, 2011; Saguier and Peinado, 2016; Svampa, 2011). In particular, social and indigenous movements favor the decommodification of nature, grassroots democracy, and overall critique of the role that transnational corporations have played under neoliberal national and international policy in human rights violations along states and international organizations (Saguier, 2012c).

SSE as defined here is built from the ‘bottom-up’ forces through collective processes (Montoya, 2012: 39). Namely, it is not seen as a closed agenda but as a gradual and dynamic process of transformative social movement construction (Kawano, 2013). Its possibilities to bring about transformation depend on the capacities to exploit the contradictions of ongoing political processes in South America while advancing new ideas and grassroots practices of production, consumption, and democratic decision-making based on the values of solidarity, equity, and environmental sustainability (Red de redes de economía alternativa y solidaria [REAS], 2012).

SSE as social inclusion

In another archetypical form, SSE is defined as a means to advance socially inclusive means of development. The scope of what needs to be transformed is modest when compared with the previous conception of SSE as alternative economic paradigm. Here, capitalism is seen as potentially becoming more social and equitable. SSE is tool of social inclusion in line with a broader commitment to economic redistribution aimed at reducing inequality and combating poverty through a combination of state policies and market mechanisms.

The focus is on employment generation as a means of social integration. Distributional considerations are central here, but there is no room for a qualitative problematization of consumption or society–nature relations. Instead, a quantitative notion of material improvement underpins this notion of SSE, linked to the improvement of income and consumption capacity of vulnerable sectors of society in line with social justice motivations. Unlike the concept of SSE as an alternative economic paradigm, here the link with considerations of ecological sustainability is weak or nonexistent.

The array of SSE practices is also more limited than in the previous notion. Fundamentally, it includes cooperatives, family enterprises, trusts offering support services to small-scale productive activities, and so on. Its narrower focus enables a clearer evaluation of policy programs through performance indicators such as job creation, improved savings capacity, strengthening operational capabilities, marketing, access to funding from both sources of solidarity, and public or market instruments. That is, the beneficiaries of SSE programs, and parameters of success or failure of SSE policies, are better defined and limited than in SSE as an alternative economic paradigm.

SSE as social policy instrument can be implemented as a focal intervention on vulnerable sectors of the population. It can also be used as one of many policy interventions in other areas (health, education, housing, but also fiscal, industrial, labor and macroeconomic policies, etc.) aimed at mobilizing the overall economic dynamism of society through inclusive development. In other words, SSE can be used as palliative social policy to manage the social costs of a neoliberal economic perspective on vulnerable sectors or as an instrument of development policy with an active role of the state in the economy. The degree of relative autonomy or dependence of the beneficiaries of SSE programs is dependent on the presence of other variables. In a targeted intervention, without other conditions conducive to social inclusion, the degree of dependence of SSE beneficiaries is greater than in a setting where beneficiaries count on other public policy mechanisms generating opportunities for social inclusion. In this respect, it is not always easy to separate SSE as social policy or economic policy. Namely, SSE may or may not be part of a development policy, yet only if accompanied by a set of complementary and effective policies (Elson, 2004).

This can be seen in relation to cooperatives as SSE actors. In a market economy, cooperatives are not immune to the logic of economic competition, which can lead them to adapt to market pressures and become like any other commercial enterprise. Thus, big cooperatives can assume features typically associated with corporate institutional culture and corporate social responsibility, leading to a form of ‘coopitalism’ (Defourny and Develtere, 2009). The implication is that cooperatives can end up betraying their ideas and goals in response to the structural demands to pursuit profit. One element to counter-balance this is to have a support system that shields or offsets market pressures, such as a stable demand for products and services provided by the cooperatives through public procurement instruments, public funding, and a reliable system of self-funding that can be aided by a regulatory context conducive to tax deductible contributions to stimulate mobilization of funds through individual and institutional donors.

These two different notions of SSE set the conceptual parameters for comparing the significance of SSE agendas in the field of regional cooperation in UNASUR and MERCOSUR. As archetypical definitions, their characterizations are ideal types that most often appear less clearly defined in actual SSE practices. Most importantly, SSE reflects the coming together politically and ideologically of two currents as part of a counter-hegemonic coalition or alliance. While subject to tensions, this in itself is a contestation of the exclusionary logic of the dominant capitalist economy.

The construction of regional frameworks for SSE

This section discusses the implementation of the SSE agenda as part of regional cooperation initiatives in the UNASUR and MERCOSUR processes. In particular, we compare both regional grouping in terms of and the institutional channels through which these policies are implemented and the targeted beneficiaries of the SSE regional programs. This allows us to assess how SSE has entered the policy arena of regional cooperation and to reflect on the opportunities and limitations this creates for the building of a development agenda of regionalism.

UNASUR

The SSE enters the UNASUR in 2009 as an agenda of regional cooperation with the creation of the South American Social Development Council (CSDS in Spanish). The CSDS work is carried out through the Ministry of Social Development of member countries, organized in five Working Groups dealing with different thematic areas: poverty and social inequality; food security and the fight against malnutrition; social solidarity economy and/or community economy with productive inclusion and generation of opportunities; citizen participation in the field of social development of UNASUR; and regional cooperation for the implementation and financing of social policies (South American Council of Social Development of UNASUR [CSDS], 2012). The emphasis is placed on SSE as an instrument of social policy for poverty eradication, even if the language of official documents is not precise about how exactly SSE practices can lead to poverty eradication. This reflects the newness of this agenda, still devoid of firm and shared understandings of what SSE potential contributions can be for the exploration of development policies through regional cooperation.

In the SSE working group, the 2012–2014 Action Plan proposed the following: prepare a document of quantitative and qualitative identification of actors; make SSE actors, practices, initiatives, and values of the social economy and/or community visible; strengthen the tools for productive and financial inclusion and the generation of opportunities; and promote the development of a monitoring and evaluation system (CSDS, 2012). The main achievement of this initiative is to have included in the UNASUR agenda the commitment to work together toward the creation of a framework for social policies of UNASUR. The fact that the SSE is one of five areas of work of this CSDS is auspicious while opening a specific institutional space to explore this subject at the interministerial level and an opportunity for advocacy for social actors and networks conducive to the SSE in the region.

Actions oriented to finding common criteria for SSE, and particularly the goal of identifying and making often unknown SSE practices publicly visible, are particularly valuable at this early stage of the scaling up process. Other considerations are less promising. The location of the SSE agenda under the CSDS, and not in the Economic Council of UNASUR (CE) or in both councils as a cross-cutting theme, poses limits to understanding the different ways in which SSE experiences could help widen a regional policy debate process aimed at exploring a development agenda and cooperation instruments beyond the treatment of SSE as strictly social policy.

With respect to the generation of financial instruments to support SSE programs, UNASUR does not count on a reliable mechanism to ensure secure access to resources or institutionalized mechanisms to mobilize or generate resources. The Bank of the South initiative was originally proposed by Néstor Kirchner and Lula da Silva as development bank that could serve as an instrument to support south–south development cooperation in the framework of South American integration (Burgess, 2016). Formally established in 2009, the Bank of the South, which included Argentina, Bolivia, Brazil, Ecuador, Paraguay, and Uruguay, eventually lost political momentum, in part due to Brazil’s reluctance to reduce the role it’s National Economic and Social Development Bank (BNDES) had in financing of infrastructure projects as part of the Initiative for the Integration of the Regional Infrastructure in South America (IIRSA) of the South American Council of Infrastructure and Planning of UNASUR (COSIPLAN; Iglecias 2011; Saguier, 2012b). The Brazil’s leverage in the politics of infrastructure integration would have been diluted had the Bank of the South acquired the role of a regional development bank. Brazil also prioritized its alignment with the Brazil, Russia, India, China, and South Africa (BRICS) alliance, particularly the construction of a BRICS Development Bank (Kingah and Quiliconi, 2015). These factors, combined with the economic downturn that impacted the region following the effects of the 2008 global crisis and the resulting retrenchment of regionalism to ‘national’ priority issues, contributed to the declining relevance of the Bank of the South initiative from the regional integration agenda. No additional financial mechanism was set in motion to support the continuity of the SSE programs at UNASUR. The much needed regional financial instruments to support the SSE sector and policies do not appear to be a likely possibility in the immediate future.

MERCOSUR

SSE discourse is articulated by a variety of organizations within MERCOSUR, but there are two main bodies developing a regional policy platform that specifically address the SSE sector. These are the MERCOSUR Social Institute (ISM) and the Special Council of MERCOSUR Cooperatives (RECM). ISM in particular presents SSE programs as part of a broader social development agenda that has been visible within the MERCOSUR policy framework since the formation of the Council of MERCOSUR Ministers and Social Development Authorities (RMADS) in 2000 (Varillas, 2012: 10). RECM, on the other hand, an important protagonist organization for the SSE agenda, promotes cooperative enterprises as viable engines of economic and social development, but it had to fight to be heard outside of social policy institutions. In what might be seen as a slightly more transformative perspective compared to UNASUR, both ISM and RECM frame SSE as a means of facilitating regional productive integration, but involvement in the Group on Productive Integration (GIP), which oversees broader integration initiatives across a variety of sectors has been limited.

Established in 2007 under the institutional umbrella of the Social MERCOSUR, the ISM submitted a project called Social and Solidarity Economy for Regional Integration, the goal of which is the social inclusion of families in situations of socio-economic, employment, or productive vulnerability in international border areas (ISM, n.d.). Key components of this program include the construction of centers for the promotion of SSE (Centros de Promoción de la Economía Social y Solidaria, CPESS) and the support of local initiatives that develop the economic, social, environmental, and cultural value chains in frontier zones, where poverty and social vulnerability are prevalent. The pilot for this project, called Social Economy of the Frontier, was started in Uruguay in 2007 and administered by the Uruguayan Ministry of Social Development (MIDES) in collaboration with the MERCOSUR Structural Convergence Fund (FOCEM) and the United Nations Development Program (UNDP).

The main goal of the pilot program was to strengthen frontier communities with social economy projects (Ministerio de Desarrollo Social [MIDES], 2007: 2). However, support for solidarity enterprises was not very developed. The proposal states that the program intends to offer ‘technical and economic support for small enterprises, preferably associative, to set up small “micro-regional” networks of commercial exchange at the frontier and better understand these micro-regional markets’ (MIDES, 2007: 9; emphasis added). A clear definition of social economy is missing and there is only a preferred requirement of participation. The independent program evaluation reveals that the number of individually run enterprises actually increased over the course of the program and only 4.2% of the participants engaged in commerce across the border with Argentina or Brazil (Moreno et al., 2011: 29), offering minimal prospects for productive integration of a transformative nature.

This project in Uruguay deployed SSE as a poverty eradication program, not a widespread shift in production strategy. Thus, it was executed in 2005 as social policy under the umbrella of the national Programs for Attention to Social Emergency (Programas de Atención a la Emergencia Social, PANES) and the target population was individuals living in poverty, rather than dynamic sectors of the economy where transformation of dominant trends might take place. Moreover, the number of participants living above the national poverty line could not surpass 30% of total participants (Moreno et al., 2011: 5). The projected reach of the program targeted 400 households, approximately 1700 individuals, and the creation of 100 productive enterprises (MIDES, 2007). Ultimately only 65 projects were funded (Moreno et al., 2011: 19). In addition to the direct funding that was channeled to the local level, frontier communities also benefited from the workshops, seminars, and events organized by the Spanish International Cooperation Agency for Development (AECID) and MIDES to promote SSE and the cooperative movement. However, the evaluators report that participation was minimal and attendees were confused as to the objective of these events, thinking they would provide access to new customers rather than opportunities for training or information exchange (Moreno et al., 2011: 9). In January 2016, FOCEM approved another grant to the ISM, this time for general technical support to strengthen its capacity as a coordination and knowledge sharing platform, especially between researchers and social policymakers (Agreement number 01/16).

The RECM, set up in 2001, constitutes the other main MERCOSUR body involved in SSE promotion through the promotion of the cooperatives at the regional level. It acts as a council of government institutions and autonomous cooperative associations, and its organizational strength is unparalleled by any other SSE representative body. Indeed, RECM was responsible for anchoring much of the MERCOSUR SSE policy framework around cooperatives. RECM has consistently presented cooperatives as drivers of social and economic development. Its position at the policy-making table has been hard fought and has only recently begun to be seen as a consultant on policy.

In collaboration with AECID, in 2008 RECM developed a program based on six lines of work: (1) capacity-building and institutional development; (2) incorporation of gender analysis into MERCOSUR; (3) environment; (4) productive integration and social economy; (5) local, rural, and frontier zone development in the region; (6) and health (Dutto, 2009: 7). The objective of the productive integration and social economy work area is to ‘promote cooperative movements in the Southern Cone as instruments of social inclusion, decent work creation and as actors in the development and deepening of MERCOSUR’ (Martínez, 2011: 10, translation by authors). International border areas emerge again as targets for poverty eradication and regionalization efforts. Numerous conferences, seminars, and workshops have been organized to exchange ideas and experiences about the role of cooperatives and SSE in regional integration.

The members of the RECM council, unlike the other programs examined above, provide a mix of economic and social policy implementation channels, and the bulk of programs promoted by this group attempt to bolster mainstream support for cooperatives in the region in an effort to transform dominant economic systems. On the council, there are a total of six government institutions, five of which are dedicated to cooperatives or social economy and one that is part of the Uruguayan Ministry of economy and finance. Also, the Brazilian Department of Cooperativism and Rural Associativism is part of the Ministry of Agriculture and the Secretariat of Social Economy is part of the same country’s Ministry of Labor.

The cooperative movement of the MERCOSUR countries is represented by national confederations of cooperatives in the Economic-Social Consultative Forum of MERCOSUR (FCES). This is the case of COOPERAR in Argentina, OCB in Brazil, CONPACOOP in Paraguay, and CUDECOOP in Uruguay. These national confederations have a record of advocacy work in this policy-relevant forum, shaping the regional policy debates on economic and social development issues. In particular, their work in the areas of food production, banking systems, public service, insurance, housing, and health has allowed them to earn recognition as a key stakeholder in the MERCOSUR process.

Cooperative groups’ advances toward more participatory policy-making may be one of the reasons why the SSE policy framework of MERCOSUR is significantly more developed than that of UNASUR. The SSE regional policy framework emerged in line with a changing political climate in favor of cooperatives in the region. In many ways, MERCOSUR has given the cooperative movement a seat at the regional policy-making table that it has never been afforded and which does not exist in other similar institutions like the Andean Community. According to the National Institute of Social Economy in Argentina (INAES), cooperatives and self-managed enterprises represent 10% of the country’s gross domestic product (GDP) and involve some 10 million Argentine workers (REAS, 2012). Table 1 provides figures detailing the number of cooperative enterprises and corresponding affiliates that make up the cooperative movement of MERCOSUR in 2009 – even though Chile is an associated member of MERCOSUR and Venezuela in 2009 had not yet acquired full membership status into the sub-regional bloc.

Table 1.

Cooperative movement in MERCOSUR.^a

Country	Number of cooperatives		Number of members
Argentina	12,760		9,392,713
Brazil	OCB	7682	7,887,707
	SENALES	2115	–
	UNICAFES	1090	–
Paraguay	1121		998,000
Uruguay	1543		1,000,000
Chile	2314		1,180,692
Venezuela	254,529		1,968,897

Source: Dutto (2009: 31).

Statistics from 2009 for cooperatives organized in labor and economic representation systems.²

Moreover, national governments of the MERCOSUR countries have also shown themselves to be important drivers behind the SSE agenda alongside the cooperative movement. As part of this evolving trajectory of social development ideas, national governments have begun to incorporate SSE enterprises (primarily cooperatives) into government institutions to address inequality and unmet social needs. Argentina created the National Institute of Associativism and Social Economy (INAES) in 2000, while Paraguay established the National Institute of Cooperativism (INCOOP) in 2003. The National Institute of Cooperativism (INACOOP) in Uruguay was formed in 2008 and Chile established its National Cooperative Department in 2003. Brazil created the National Secretariat of Solidarity Economy in 2003, and while Venezuela set up the National Superintendency of Cooperatives as early as 1967, in 2001, the Cooperatives Law and Chavez’s leadership gave renewed support and emphasis to the sector (Chaguaceda, 2011: 32). Moreover, Ecuador passed the Organic Law on Popular and Solidarity Economy and on the Popular and Solidarity Financial Sector in 2011, which establishes a National Institute on Popular and Solidarity Economy. While Bolivia’s institutionalization of SSE organizations in the state apparatus is not as advanced as its neighbors, Evo Morales’ presidency has taken a political stand against neoliberal market-based development in favor of the more socially and environmentally focused model of el buen vivir.

The exchange of ideas, funding, and leadership that advance the SSE agenda in South America is a process that is multidirectional, involving local and regional civil society groups, national governments, and intergovernmental organizations. The definition of SSE is therefore contested and dynamic. In its current articulation, the SSE regional policy framework clearly puts emphasis on the cooperative sector, despite the fact that the SSE encompasses many other types of organizations as cooperatives are a tangible policy target that also happens to have a strong presence in South America. Given the relative novelty of this SSE regional framework, it is a logical place to begin directing policy toward. However, the danger for the civil society groups promoting SSE as defined in the RIPESS Lima Declaration is that as SSE is incorporated into regional integration efforts, the meaning of SSE will stray from its transformative roots and organizations like MERCOSUR and UNASUR will simply support cooperatives as a fringe sector, ignoring the other types of SSE enterprises and the deeper political project of overcoming the dominant capitalist modes of production. This marginalization did not go unnoticed by RECM, which in 2009 petitioned the GIP to let it participate in meetings and debate. Meeting documents show RECM’s attendance at one meeting in 2010 (MERCOSUR, 2010) and 2 years later, again initiated by RECM, an attempt to outline a strategic partnership between the two bodies (Reunión Especializada de Cooperativas MERCOSUR [RECM], 2012). Despite this minimal progress, current productive projects discussed by GIP do not target cooperatives or other parts of the SSE sector.

Perhaps because of difficulty forging an alliance with GIP, RECM has developed its own parallel productive integration program. As part of the project for the Promotion of MERCOSUR Cooperatives (PROCOOPSUR) launched in 2010 in order to help national governments advance pro-cooperative policy and support for the cooperative movement, RECM founded the Business Office, which has proposed integration plans for cooperative production chains including, wool, wheat, organic sugar, yerba mate, tourism, and recyclables (MercosurABC, 2012) The two pillars of this work are commercial support and the development of productive networks in international border areas.

Funding is a key challenge to advancing a coherent and meaningful SSE policy framework (Gomes et al., 2011). Following the proposals of the RECM (2012), a new funding mechanism was set up in 2015: the Promotion Fund for MERCOSUR Cooperatives (FCOOP). This decision was an important step in the direction of institutionalizing a mechanism to finance the integration of cooperatives movements in Argentina, Brazil, Paraguay, Uruguay, and Venezuela. FCOOP started with an initial capitalization of US$390.000 although it is expected that cooperatives make contributions to the fund in relation to their capacity and proportional size. The funds will be administered by an international organization following the Food and Agriculture Organization (FAO) or the UNDP model, and it is located in the MERCOSUR building in Montevideo.

Conclusion

In this article, we explored the scaling up of the SSE in UNASUR and MERCOSUR in order to reflect on the prospects for opening opportunities for policy convergence on development-related issues. We focused on which particular SSE practices and agendas have been mainstreamed as policy-relevant practices for regional cooperation and on how the SSE agenda has become institutionally embedded in the framework of regional cooperation in each case. This leads to the following three conclusions.

First, the scaling up of the SSE agenda acquires political significance in terms of the possibilities it allows for governments and social actors to position development issues as part of a regional cooperation effort. Since there is no consensus about what ‘development’ amounts to, there is sufficient room for the process to define its content and scope. In this sense, regional cooperation in development policy issues is an open process. Scaling up SSE provides an opportunity to raise awareness of grassroots practices that are either unknown or marginalized from public policy domains in general and from regional integration processes in particular. In the case of UNASUR, since it is a newer integration scheme, SSE is only at the early stage, as reflected on a commitment to work toward identifying SSE actors as part of a collective effort. In contrast, MERCOSUR has a much longer history in mainstreaming SSE and hence its SSE programs are comparatively better equipped to help position SSE practices and actors in the regional integration arena.

Second, the scaling up process privileged a narrow conception of SSE practices associated with cooperatives, while it sidestepped other practices and ideas of the heterogeneous SSE community that pose more radical questions to the overall logic of extractive-dependent economic growth. In particular, critical views and alternatives to the dominant culture of consumerism, materialism, and reliance on natural resource extractive sectors have thus far been ignored. When SSE has been scaled up, it has taken the form of social policy which aims to bring about social inclusion through poverty reduction programs. As the MERCOSUR case shows, this notion of SSE in the form of support for cooperatives on international border areas aims to bring about social cohesion while also stimulating trans-boundary relations among cooperative actors. The reasons for the taking up of such a narrow notion of SSE are varied. Cooperatives are SSE actors better positioned to gain greater access in regional decision-making spaces and hence influence the policy process, and their activities and outcomes are more easily mainstreamed in a public policy framework.

In addition, there is also structural selectivity in the scaling up process that operates in determining what SSE practices and ideas are mainstreamed as policy agendas and which are not. The importance that extractive sectors have in the growth strategies of all South American countries – whether agroindustry, mining, hydrocarbon, forestry, or biodiversity – have been sources of socio-environmental conflicts and criticism. Neither the neoliberal nor the neo-developmental policy frameworks are adequately prepared to respond to these challenges. Social actors identified broadly in the SSE field from a post-development perspective reside at the margins of institutional politics or only engage with it in specific conjunctures. In this respect, UNASUR and MERCOSUR do not provide adequate spaces to problematize the resource-related economic activities with SSE experiences with the aim of expanding the regional public sphere in a development-centered debate. Issues such as the health and food security implications of the use of pesticides in agribusiness practices or the need to assess the use of natural resources beyond their potential as economic resources to consider their value as eco-systemic services are examples of the issues that have a correlation with SSE practices that do not enter the regional governance spaces.

Third, overall the SSE agenda is weakly embedded in the institutional architecture of the region. In the case of UNASUR, where there is less consensus between member states about the meaning and scope of the SSE agenda in the regional process, there are no institutional conditions to ensure that SSE programs are sustained in the future. In particular, there is no core funding or financial instrument to support SSE initiatives. Moreover, the dependence of SSE programs on the interministerial functioning of UNASUR, with little participation of SSE social organizations and networks, does not provide institutional openings for social actor to engage, support, or problematize the SSE agenda and programs’ implementation. Moreover, the SSE regional mechanisms are comparatively better institutionalized in MERCOSUR than in UNASUR as MERCOSUR has the MERCOSUR Social Institute (ICM) and Special Council of MERCOSUR Cooperatives (RECM) governance bodies specifically dedicated to this agenda, but also because the regional level coordination is articulated with national level programs and policies.

The relatively favorable institutional positioning of the SSE agenda in the MERCOSUR process, however, does not necessarily translate into opportunities for cooperatives to engage in regional development policy-making. In MERCOSUR, SSE is seen as a social policy to combat poverty; hence, it plays a marginal role in the core of the bloc’s regional economic policy and governance bodies. We recognize that the distinction between social and economic policy is not always easy to maintain. However, in order for social policies to be more than palliative remedies and to act instead as instruments of development policy, complementary measures need be present. The same can be said about the transformative potential of cooperatives. For cooperatives to avoid yielding to market pressures in ways that end up compromising their social role, they need be supported by additional policies. In this regard, UNASUR and MERCOSUR offer no complementary regional instruments necessary to ensure good program performance and especially to energize other aspects as the SSE such as financing in solidarity systems, the promotion of production methods and consumption of agro-ecological criteria, establishment of exchange networks, sustained visibility and promotion in a market dominated by profit-driven production and consumption, health and environmental awareness vis-à-vis patterns of mass consumption and production, and so on. It is at the national level where some complementary policies and instruments are present in some areas, as seen in Argentina, Brazil, and Uruguay with explicit policies to support cooperatives as well as overall development-oriented policy framework consistent with attaining social inclusion goals. Similarly, financial support for the SSE is scarce and limited to public funds. This does not help to strengthen the conditions required to raise the social economy and achieve effective alternatives to overcome its dependence on state support or being absorbed by the market. Here again, MERCOSUR provides comparatively a better context of instruments to finance SSE activities (cooperatives) than UNASUR.

Political convergence of the countries of a regional bloc is a determining factor in the scaling up of the SSE agenda, particularly given the frail institutionalization of this agenda in UNASUR and MERCOSUR. This is clear in relation to MERCOSUR, where the confluence of neo-developmentalist governments of progressive orientation was crucial for positioning cooperatives as agents of development. That meant that SSE instruments are better institutionalized and have clear criteria in MERCOSUR in contrast to UNASUR where the ideological orientation of its members is more heterogeneous. Convergence takes place not only at the interstate coordination in the MERCOSUR process but also in the national policies that support the SSE – as has been the case with institutes and reform of legal frameworks to promote SSE activities.

The rapidly changing political context of South American regionalism since 2016 exacerbates the vulnerabilities of the SSE agenda, bringing the momentum of post-hegemonic regionalism to a halt. The election of Mauricio Marci in Argentina and the coming to power of Michel Temer following a controversial impeachment of Dilma Rousseff in Brazil herald a shift in the balance of power in the region which is adverse to socially progressive agendas like the SSE. These new governments expressed their preference for free trade policies that conflict with the neo-developmental assumptions behind MERCOSUR and the importance that UNASUR attributes to regional governance. Similarly, the political crisis in Venezuela and the absence of the leadership that Chávez once imposed on agenda setting process of regionalism further weaken the impetus behind SSE, while the weight of Evo Morales and Rafael Correa is too diminished to salvage and much less deepen a regionalism-development nexus.

Apart from being a development policy discourse enriched by different practices and ideas of the grassroots socio-economic organizing, the SSE is also a set of survival strategies developed by marginalized social sectors and non-capitalist cultures throughout history. In this respect, a change of political context in the region brings SSE practices to where they came from. Even if SSE remains on the agenda in the new phase of regionalism, it is likely to be subject to instrumentalization of its core ideas and values. The ‘green economy’ and ‘the corporate social responsibility’ can easily displace the SSE practices as promising alternatives or else push SSE ideas to converge with these competing frameworks. What is clear is that demands for social and environmental justice will continue to be drivers of transformative change. SSE social movements and networks can capitalize on these demands and make use of what has been learned and the transnational coalitions that were forged, to act as bottom-up pressures to open up critical spaces to show the contradictions between concentrated capitalism, democracy, and ecological sustainability. The issues that gave rise to the SSE movement will not disappear because governments change and because they emerge from structural conditions that remain constant. The experience of scaling up SSE in a regional cooperation context may well have sowed the seeds of a new generation of ideas, actors, and practices, awaiting to flourish when the next spring returns.

Footnotes

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

Notes

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