Central American Integration System
Encyclopedia
Central American Integration System is the economic, cultural and political organization of Central America
n states since February 1, 1993. It was on December 13, 1991, however, when all the countries of the ODECA (Spanish: Organización de Estados Centroamericanos; ODECA) signed the Protocol of Tegucigalpa which extended the earlier cooperation in search for regional peace
, political freedom, democracy
and economic development
. The headquarters of the General Secretariat of SICA are located in the Republic of El Salvador.
In 1991, the institutional framework of SICA included the States of Guatemala
, El Salvador
, Honduras
, Nicaragua
, Costa Rica
and Panama
. Belize
joined in 2000 as full member, while the Dominican Republic
became an associated state in 2004. More recently, Mexico
, Chile
and Brazil
became part of the organization as regional observers; while the Republic of China
, Spain
, Germany
and Japan
became extrarregional observers. The SICA has a standing invitation to participate as observers in the sessions of the United Nations General Assembly
and maintaining permanent offices at UN Headquarters
.
Four countries, Guatemala
, El Salvador
, Honduras
, and Nicaragua
, are going through a process of political, cultural, and migratory integration and have formed a group called The Central America Four or CA-4
, which has introduced common internal borders. Belize, Costa Rica, Panama and Dominican Republic join the CA-4 only in matters of economic integration and regional friendship.
and the United States, five Central American nations – Costa Rica
, El Salvador
, Guatemala
, Honduras
and Nicaragua
– took part in the Central American Peace Conference in Washington, D.C, sponsored by United States
President Theodore Roosevelt
's Secretary of State
, Nobel Prize
winner Elihu Root
. The five nations, which had all previously been Spanish
colonies
had sought on numerous prior occasions, with great difficulty, to form a political alliance. The earliest attempt was the Federal Republic of Central America
, and the most recent such effort had taken place 11 years earlier, with the founding of the Republic of Central America
.
Nations ended the Conference by signing a peace treaty, one aspect of which created the Central American Court of Justice (Corte de Justicia Centroamericana). The signatories agreed that the convention creating the Court would remain in effect for ten years, beginning at the time of the last ratification. All communications between the signatories were made through the government of Costa Rica. The Court was composed of five judges, one each from each member state. For the period of its functioning the Court heard ten cases, five of which were brought by private individuals and declared inadmissible, and three of which were started by the Court's own initiative. The court operated for 10 years, until April 1918, from its headquarters in Costa Rica
, at which point it dissolved. Its members had sought without success from March 1917, when Nicaragua gave a notice of termination from the agreement, to continue the arrangement.
Several explanations for the treaty's failure exist:
Following the end of World War II
, a new interest in integrating the Central American governments began. On October 14, 1951, 33 years after the dissolution of the CACJ, the governments of Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua signed a new treaty creating the Organization of Central American States (Organización de Estados Centroamericanos, or ODECA) to promote regional cooperation, integrity and unity in Central America. The following year, December 12, 1952, ODECA's charter was altered to create a new Central American Court of Justice (this time called the Corte Centroamericana de Justicia, or CCJ), without the time limitation of its previous incarnation.
The Charter
of San Salvador
was ratified by all the governments of Central America
, and on August 18, 1955 the foreign minister
s held their first meeting in Antigua Guatemala
. There ensued the Declaration of Antigua Guatemala, which decreed that subordinate organizations should be formed under ODECA, to help establish systems of organization and procedure so there would be no restrictions to free intercourse, to economic cooperation, to better sanitary conditions for member nations, and to continued progress in the “integral union” of the Central American nations.
The Central American Common Market, the Central American Bank for Economic Integration, and the Secretariat for Central American Economic Integration (SIECA) were established between five nations of Central America
on December 13, 1960 in a conference in Managua
. These nations ratified the treaties of membership the following year. Costa Rica
joined the CACM in 1963. Panama is conspicuous by absence. Then organization froze in 1969 with the war between Honduras and El Salvador. In 1973, ODECA was suspended and progress in regional integration came to a standstill.
, a state that is part of the Caribbean
. Central America already has several supranational institutions such as the Central American Parliament, the Central American Bank for Economic Integration and the Central American Common Market. The current Central America trade block is organized by the General Treaty for Economical Integration signed October 29, 1993 (Guatemala Protocol). The CACM has succeeded in removing duties on most products moving among the member countries, and has largely unified external tariff
s and increased trade within the member nations. The bank has 5 non-regional members: Argentina
, Colombia
, Mexico
, Taiwan
and Spain
.
A new currency is unlikely and a dollarization of the region is perhaps the only possibility.The emergence of a new common currency would also be troubled by the available regional institutions’ lack of effectiveness, resources and relevance; thus, governments have rarely delegated responsibilities to them. A regional central bank would also have to be established and it’s not clear how this would be done.The currency union undertaking—a process that would require frequent and consistent political commitment—has not found priority in the regional agenda. Regional efforts are focused on security problems and social issues such as combating drug trafficking and organized crime, improving education, meeting energy needs, crafting natural disaster prevention measures, etc.
In terms of Robert Mundell
’s Optimum Currency Area
criteria, Central America does not fulfill important prerequisites for a union and is arguably not the site of an optimum currency area. Though the region as a whole enjoys a high degree of factor mobility, diversified composition of output, price and wage flexibility, and important financial integration it also fails to meet important criteria. The lack of business cycle synchronization, high and dissimilar levels of public sector debt, diverging inflation rates, and the lack of high levels of intraregional trade are some deficiencies.
which existed from 1823 to 1840. Costa Rica
is the only one of the original five states not to join Parlacen, but in its place are two new contributors: Panama
(which was once part of Colombia, or rather New Granada, and so was not one of the original Central American states) and the Dominican Republic
. It has its more recent origins in the Contadora Group
, a project
launched in the 1980s to help deal with civil war
s in El Salvador
, Guatemala
and Nicaragua
. Although the Contadora was dissolved
in 1986, the idea for Central American Integration remained, and its works were taken by the Esquipulas Peace Agreement
, which, among other acts, agreed to the creation of the Central American Parliament. Members return 20-22 directly elected deputies to the Parliament. In spite of its efforts to promote the Esquipulas Agreement, Costa Rica
has not yet ratified and is consequently not represented in the Parlacen. Parlacen has been seen by some, including former President of Honduras, Ricardo Maduro
as a white elephant
.
The Court may also offer consultation to the Supreme Courts of the region. In 2005, the Court ruled that Nicaraguan congressional reforms, which took control of water, energy and telecommunications services away from President Enrique Bolaños
were "legally inapplicable", possibly further inciting the Nicaraguan political crisis. As of July 2005, the CCJ has made 70 resolutions since hearing its first case in 1994.
Central America
Central America is the central geographic region of the Americas. It is the southernmost, isthmian portion of the North American continent, which connects with South America on the southeast. When considered part of the unified continental model, it is considered a subcontinent...
n states since February 1, 1993. It was on December 13, 1991, however, when all the countries of the ODECA (Spanish: Organización de Estados Centroamericanos; ODECA) signed the Protocol of Tegucigalpa which extended the earlier cooperation in search for regional peace
Peace
Peace is a state of harmony characterized by the lack of violent conflict. Commonly understood as the absence of hostility, peace also suggests the existence of healthy or newly healed interpersonal or international relationships, prosperity in matters of social or economic welfare, the...
, political freedom, democracy
Democracy
Democracy is generally defined as a form of government in which all adult citizens have an equal say in the decisions that affect their lives. Ideally, this includes equal participation in the proposal, development and passage of legislation into law...
and economic development
Economic development
Economic development generally refers to the sustained, concerted actions of policymakers and communities that promote the standard of living and economic health of a specific area...
. The headquarters of the General Secretariat of SICA are located in the Republic of El Salvador.
In 1991, the institutional framework of SICA included the States of Guatemala
Guatemala
Guatemala is a country in Central America bordered by Mexico to the north and west, the Pacific Ocean to the southwest, Belize to the northeast, the Caribbean to the east, and Honduras and El Salvador to the southeast...
, El Salvador
El Salvador
El Salvador or simply Salvador is the smallest and the most densely populated country in Central America. The country's capital city and largest city is San Salvador; Santa Ana and San Miguel are also important cultural and commercial centers in the country and in all of Central America...
, Honduras
Honduras
Honduras is a republic in Central America. It was previously known as Spanish Honduras to differentiate it from British Honduras, which became the modern-day state of Belize...
, Nicaragua
Nicaragua
Nicaragua is the largest country in the Central American American isthmus, bordered by Honduras to the north and Costa Rica to the south. The country is situated between 11 and 14 degrees north of the Equator in the Northern Hemisphere, which places it entirely within the tropics. The Pacific Ocean...
, Costa Rica
Costa Rica
Costa Rica , officially the Republic of Costa Rica is a multilingual, multiethnic and multicultural country in Central America, bordered by Nicaragua to the north, Panama to the southeast, the Pacific Ocean to the west and the Caribbean Sea to the east....
and Panama
Panama
Panama , officially the Republic of Panama , is the southernmost country of Central America. Situated on the isthmus connecting North and South America, it is bordered by Costa Rica to the northwest, Colombia to the southeast, the Caribbean Sea to the north and the Pacific Ocean to the south. The...
. Belize
Belize
Belize is a constitutional monarchy and the northernmost country in Central America. Belize has a diverse society, comprising many cultures and languages. Even though Kriol and Spanish are spoken among the population, Belize is the only country in Central America where English is the official...
joined in 2000 as full member, while the Dominican Republic
Dominican Republic
The Dominican Republic is a nation on the island of La Hispaniola, part of the Greater Antilles archipelago in the Caribbean region. The western third of the island is occupied by the nation of Haiti, making Hispaniola one of two Caribbean islands that are shared by two countries...
became an associated state in 2004. More recently, Mexico
Mexico
The United Mexican States , commonly known as Mexico , is a federal constitutional republic in North America. It is bordered on the north by the United States; on the south and west by the Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of...
, Chile
Chile
Chile ,officially the Republic of Chile , is a country in South America occupying a long, narrow coastal strip between the Andes mountains to the east and the Pacific Ocean to the west. It borders Peru to the north, Bolivia to the northeast, Argentina to the east, and the Drake Passage in the far...
and Brazil
Brazil
Brazil , officially the Federative Republic of Brazil , is the largest country in South America. It is the world's fifth largest country, both by geographical area and by population with over 192 million people...
became part of the organization as regional observers; while the Republic of China
Republic of China
The Republic of China , commonly known as Taiwan , is a unitary sovereign state located in East Asia. Originally based in mainland China, the Republic of China currently governs the island of Taiwan , which forms over 99% of its current territory, as well as Penghu, Kinmen, Matsu and other minor...
, Spain
Spain
Spain , officially the Kingdom of Spain languages]] under the European Charter for Regional or Minority Languages. In each of these, Spain's official name is as follows:;;;;;;), is a country and member state of the European Union located in southwestern Europe on the Iberian Peninsula...
, Germany
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
and Japan
Japan
Japan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south...
became extrarregional observers. The SICA has a standing invitation to participate as observers in the sessions of the United Nations General Assembly
United Nations General Assembly
For two articles dealing with membership in the General Assembly, see:* General Assembly members* General Assembly observersThe United Nations General Assembly is one of the five principal organs of the United Nations and the only one in which all member nations have equal representation...
and maintaining permanent offices at UN Headquarters
United Nations headquarters
The headquarters of the United Nations is a complex in New York City. The complex has served as the official headquarters of the United Nations since its completion in 1952. It is located in the Turtle Bay neighborhood of Manhattan, on spacious grounds overlooking the East River...
.
Four countries, Guatemala
Guatemala
Guatemala is a country in Central America bordered by Mexico to the north and west, the Pacific Ocean to the southwest, Belize to the northeast, the Caribbean to the east, and Honduras and El Salvador to the southeast...
, El Salvador
El Salvador
El Salvador or simply Salvador is the smallest and the most densely populated country in Central America. The country's capital city and largest city is San Salvador; Santa Ana and San Miguel are also important cultural and commercial centers in the country and in all of Central America...
, Honduras
Honduras
Honduras is a republic in Central America. It was previously known as Spanish Honduras to differentiate it from British Honduras, which became the modern-day state of Belize...
, and Nicaragua
Nicaragua
Nicaragua is the largest country in the Central American American isthmus, bordered by Honduras to the north and Costa Rica to the south. The country is situated between 11 and 14 degrees north of the Equator in the Northern Hemisphere, which places it entirely within the tropics. The Pacific Ocean...
, are going through a process of political, cultural, and migratory integration and have formed a group called The Central America Four or CA-4
Central America-4 Border Control Agreement
The Central America-4 Border Control Agreement was a treaty signed in June 2006 between the Central American nations of El Salvador, Guatemala, Honduras and Nicaragua, establishing the free movement across borders between the four signatory states of its citizens without any restrictions or checks...
, which has introduced common internal borders. Belize, Costa Rica, Panama and Dominican Republic join the CA-4 only in matters of economic integration and regional friendship.
Central American Court of Justice
Between November 14, and December 20, 1907, following a proposal made by MexicoMexico
The United Mexican States , commonly known as Mexico , is a federal constitutional republic in North America. It is bordered on the north by the United States; on the south and west by the Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of...
and the United States, five Central American nations – Costa Rica
Costa Rica
Costa Rica , officially the Republic of Costa Rica is a multilingual, multiethnic and multicultural country in Central America, bordered by Nicaragua to the north, Panama to the southeast, the Pacific Ocean to the west and the Caribbean Sea to the east....
, El Salvador
El Salvador
El Salvador or simply Salvador is the smallest and the most densely populated country in Central America. The country's capital city and largest city is San Salvador; Santa Ana and San Miguel are also important cultural and commercial centers in the country and in all of Central America...
, Guatemala
Guatemala
Guatemala is a country in Central America bordered by Mexico to the north and west, the Pacific Ocean to the southwest, Belize to the northeast, the Caribbean to the east, and Honduras and El Salvador to the southeast...
, Honduras
Honduras
Honduras is a republic in Central America. It was previously known as Spanish Honduras to differentiate it from British Honduras, which became the modern-day state of Belize...
and Nicaragua
Nicaragua
Nicaragua is the largest country in the Central American American isthmus, bordered by Honduras to the north and Costa Rica to the south. The country is situated between 11 and 14 degrees north of the Equator in the Northern Hemisphere, which places it entirely within the tropics. The Pacific Ocean...
– took part in the Central American Peace Conference in Washington, D.C, sponsored by United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
President Theodore Roosevelt
Theodore Roosevelt
Theodore "Teddy" Roosevelt was the 26th President of the United States . He is noted for his exuberant personality, range of interests and achievements, and his leadership of the Progressive Movement, as well as his "cowboy" persona and robust masculinity...
's Secretary of State
United States Secretary of State
The United States Secretary of State is the head of the United States Department of State, concerned with foreign affairs. The Secretary is a member of the Cabinet and the highest-ranking cabinet secretary both in line of succession and order of precedence...
, Nobel Prize
Nobel Prize
The Nobel Prizes are annual international awards bestowed by Scandinavian committees in recognition of cultural and scientific advances. The will of the Swedish chemist Alfred Nobel, the inventor of dynamite, established the prizes in 1895...
winner Elihu Root
Elihu Root
Elihu Root was an American lawyer and statesman and the 1912 recipient of the Nobel Peace Prize. He was the prototype of the 20th century "wise man", who shuttled between high-level government positions in Washington, D.C...
. The five nations, which had all previously been Spanish
Spain
Spain , officially the Kingdom of Spain languages]] under the European Charter for Regional or Minority Languages. In each of these, Spain's official name is as follows:;;;;;;), is a country and member state of the European Union located in southwestern Europe on the Iberian Peninsula...
colonies
Spanish colonization of the Americas
Colonial expansion under the Spanish Empire was initiated by the Spanish conquistadores and developed by the Monarchy of Spain through its administrators and missionaries. The motivations for colonial expansion were trade and the spread of the Christian faith through indigenous conversions...
had sought on numerous prior occasions, with great difficulty, to form a political alliance. The earliest attempt was the Federal Republic of Central America
Federal Republic of Central America
The Federal Republic of Central America, known as the United Provinces of Central America in its first year of creation, was a sovereign state in Central America, which consisted of the territories of the former Captaincy General of Guatemala of New Spain...
, and the most recent such effort had taken place 11 years earlier, with the founding of the Republic of Central America
Republic of Central America
The Greater Republic of Central America was a short-lived union between Honduras, Nicaragua, and El Salvador, lasting from 1896 to 1898. It was an attempt to revive the failed Federal Republic of Central America earlier in the century....
.
Nations ended the Conference by signing a peace treaty, one aspect of which created the Central American Court of Justice (Corte de Justicia Centroamericana). The signatories agreed that the convention creating the Court would remain in effect for ten years, beginning at the time of the last ratification. All communications between the signatories were made through the government of Costa Rica. The Court was composed of five judges, one each from each member state. For the period of its functioning the Court heard ten cases, five of which were brought by private individuals and declared inadmissible, and three of which were started by the Court's own initiative. The court operated for 10 years, until April 1918, from its headquarters in Costa Rica
Costa Rica
Costa Rica , officially the Republic of Costa Rica is a multilingual, multiethnic and multicultural country in Central America, bordered by Nicaragua to the north, Panama to the southeast, the Pacific Ocean to the west and the Caribbean Sea to the east....
, at which point it dissolved. Its members had sought without success from March 1917, when Nicaragua gave a notice of termination from the agreement, to continue the arrangement.
Several explanations for the treaty's failure exist:
- The court lacked an effective system of judicial procedure.
- The judges were not free to act independently of their respective governments.
- The court had been given a jurisdiction too broad to satisfy its member states.
Organization of Central American States
Following the end of World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
, a new interest in integrating the Central American governments began. On October 14, 1951, 33 years after the dissolution of the CACJ, the governments of Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua signed a new treaty creating the Organization of Central American States (Organización de Estados Centroamericanos, or ODECA) to promote regional cooperation, integrity and unity in Central America. The following year, December 12, 1952, ODECA's charter was altered to create a new Central American Court of Justice (this time called the Corte Centroamericana de Justicia, or CCJ), without the time limitation of its previous incarnation.
The Charter
Charter
A charter is the grant of authority or rights, stating that the granter formally recognizes the prerogative of the recipient to exercise the rights specified...
of San Salvador
San Salvador
The city of San Salvador the capital and largest city of El Salvador, which has been designated a Gamma World City. Its complete name is La Ciudad de Gran San Salvador...
was ratified by all the governments of Central America
Central America
Central America is the central geographic region of the Americas. It is the southernmost, isthmian portion of the North American continent, which connects with South America on the southeast. When considered part of the unified continental model, it is considered a subcontinent...
, and on August 18, 1955 the foreign minister
Foreign minister
A Minister of Foreign Affairs, or foreign minister, is a cabinet minister who helps form the foreign policy of a sovereign state. The foreign minister is often regarded as the most senior ministerial position below that of the head of government . It is often granted to the deputy prime minister in...
s held their first meeting in Antigua Guatemala
Antigua Guatemala
Antigua Guatemala is a city in the central highlands of Guatemala famous for its well-preserved Spanish Mudéjar-influenced Baroque architecture as well as a number of spectacular ruins of colonial churches...
. There ensued the Declaration of Antigua Guatemala, which decreed that subordinate organizations should be formed under ODECA, to help establish systems of organization and procedure so there would be no restrictions to free intercourse, to economic cooperation, to better sanitary conditions for member nations, and to continued progress in the “integral union” of the Central American nations.
The Central American Common Market, the Central American Bank for Economic Integration, and the Secretariat for Central American Economic Integration (SIECA) were established between five nations of Central America
Central America
Central America is the central geographic region of the Americas. It is the southernmost, isthmian portion of the North American continent, which connects with South America on the southeast. When considered part of the unified continental model, it is considered a subcontinent...
on December 13, 1960 in a conference in Managua
Managua
Managua is the capital city of Nicaragua as well as the department and municipality by the same name. It is the largest city in Nicaragua in terms of population and geographic size. Located on the southwestern shore of Lake Xolotlán or Lake Managua, the city was declared the national capital in...
. These nations ratified the treaties of membership the following year. Costa Rica
Costa Rica
Costa Rica , officially the Republic of Costa Rica is a multilingual, multiethnic and multicultural country in Central America, bordered by Nicaragua to the north, Panama to the southeast, the Pacific Ocean to the west and the Caribbean Sea to the east....
joined the CACM in 1963. Panama is conspicuous by absence. Then organization froze in 1969 with the war between Honduras and El Salvador. In 1973, ODECA was suspended and progress in regional integration came to a standstill.
Revival
It was not until 1991 that the integration agenda was completed with the creation of the SICA, which provided a clear legal base to avoid discrepancies between the member states. The SICA membership includes the 7 nations of Central America plus the Dominican RepublicDominican Republic
The Dominican Republic is a nation on the island of La Hispaniola, part of the Greater Antilles archipelago in the Caribbean region. The western third of the island is occupied by the nation of Haiti, making Hispaniola one of two Caribbean islands that are shared by two countries...
, a state that is part of the Caribbean
Caribbean
The Caribbean is a crescent-shaped group of islands more than 2,000 miles long separating the Gulf of Mexico and the Caribbean Sea, to the west and south, from the Atlantic Ocean, to the east and north...
. Central America already has several supranational institutions such as the Central American Parliament, the Central American Bank for Economic Integration and the Central American Common Market. The current Central America trade block is organized by the General Treaty for Economical Integration signed October 29, 1993 (Guatemala Protocol). The CACM has succeeded in removing duties on most products moving among the member countries, and has largely unified external tariff
Tariff
A tariff may be either tax on imports or exports , or a list or schedule of prices for such things as rail service, bus routes, and electrical usage ....
s and increased trade within the member nations. The bank has 5 non-regional members: Argentina
Argentina
Argentina , officially the Argentine Republic , is the second largest country in South America by land area, after Brazil. It is constituted as a federation of 23 provinces and an autonomous city, Buenos Aires...
, Colombia
Colombia
Colombia, officially the Republic of Colombia , is a unitary constitutional republic comprising thirty-two departments. The country is located in northwestern South America, bordered to the east by Venezuela and Brazil; to the south by Ecuador and Peru; to the north by the Caribbean Sea; to the...
, Mexico
Mexico
The United Mexican States , commonly known as Mexico , is a federal constitutional republic in North America. It is bordered on the north by the United States; on the south and west by the Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of...
, Taiwan
Republic of China
The Republic of China , commonly known as Taiwan , is a unitary sovereign state located in East Asia. Originally based in mainland China, the Republic of China currently governs the island of Taiwan , which forms over 99% of its current territory, as well as Penghu, Kinmen, Matsu and other minor...
and Spain
Spain
Spain , officially the Kingdom of Spain languages]] under the European Charter for Regional or Minority Languages. In each of these, Spain's official name is as follows:;;;;;;), is a country and member state of the European Union located in southwestern Europe on the Iberian Peninsula...
.
Prospects for a Central American Currency Union
Trade with the US—the region’s largest trading partner—is the most important source of income for Central America. More than half of Central American exports are destined for the US. Remittances annually add up to billions of dollars as well. This concentration of trade with the US points to the potential benefits of reduced transaction costs and greater efficiency of a common currency. Yet, at the same time retaining their own currencies is a priority for individual countries. A weaker domestic currency means cheaper exports and a more dynamic and competitive export industry.A new currency is unlikely and a dollarization of the region is perhaps the only possibility.The emergence of a new common currency would also be troubled by the available regional institutions’ lack of effectiveness, resources and relevance; thus, governments have rarely delegated responsibilities to them. A regional central bank would also have to be established and it’s not clear how this would be done.The currency union undertaking—a process that would require frequent and consistent political commitment—has not found priority in the regional agenda. Regional efforts are focused on security problems and social issues such as combating drug trafficking and organized crime, improving education, meeting energy needs, crafting natural disaster prevention measures, etc.
In terms of Robert Mundell
Robert Mundell
Robert Mundell, CC is a Nobel Prize-winning Canadian economist. Currently, Mundell is a professor of economics at Columbia University and the Chinese University of Hong Kong....
’s Optimum Currency Area
Optimum currency area
In economics, an optimum currency area , also known as an optimal currency region , is a geographical region in which it would maximize economic efficiency to have the entire region share a single currency. It describes the optimal characteristics for the merger of currencies or the creation of a...
criteria, Central America does not fulfill important prerequisites for a union and is arguably not the site of an optimum currency area. Though the region as a whole enjoys a high degree of factor mobility, diversified composition of output, price and wage flexibility, and important financial integration it also fails to meet important criteria. The lack of business cycle synchronization, high and dissimilar levels of public sector debt, diverging inflation rates, and the lack of high levels of intraregional trade are some deficiencies.
Central American Parliament
The parliament was created with the vision to be a modern renewal of the historic Federal Republic of Central AmericaFederal Republic of Central America
The Federal Republic of Central America, known as the United Provinces of Central America in its first year of creation, was a sovereign state in Central America, which consisted of the territories of the former Captaincy General of Guatemala of New Spain...
which existed from 1823 to 1840. Costa Rica
Costa Rica
Costa Rica , officially the Republic of Costa Rica is a multilingual, multiethnic and multicultural country in Central America, bordered by Nicaragua to the north, Panama to the southeast, the Pacific Ocean to the west and the Caribbean Sea to the east....
is the only one of the original five states not to join Parlacen, but in its place are two new contributors: Panama
Panama
Panama , officially the Republic of Panama , is the southernmost country of Central America. Situated on the isthmus connecting North and South America, it is bordered by Costa Rica to the northwest, Colombia to the southeast, the Caribbean Sea to the north and the Pacific Ocean to the south. The...
(which was once part of Colombia, or rather New Granada, and so was not one of the original Central American states) and the Dominican Republic
Dominican Republic
The Dominican Republic is a nation on the island of La Hispaniola, part of the Greater Antilles archipelago in the Caribbean region. The western third of the island is occupied by the nation of Haiti, making Hispaniola one of two Caribbean islands that are shared by two countries...
. It has its more recent origins in the Contadora Group
Contadora Group
The Contadora Group was an initiative launched in the early 1980s by the foreign ministers of Colombia, Mexico, Panama and Venezuela to deal with the military conflicts in El Salvador, Nicaragua and Guatemala, which were threatening to destabilize the entire Central American region.The original...
, a project
Project
A project in business and science is typically defined as a collaborative enterprise, frequently involving research or design, that is carefully planned to achieve a particular aim. Projects can be further defined as temporary rather than permanent social systems that are constituted by teams...
launched in the 1980s to help deal with civil war
Civil war
A civil war is a war between organized groups within the same nation state or republic, or, less commonly, between two countries created from a formerly-united nation state....
s in El Salvador
El Salvador
El Salvador or simply Salvador is the smallest and the most densely populated country in Central America. The country's capital city and largest city is San Salvador; Santa Ana and San Miguel are also important cultural and commercial centers in the country and in all of Central America...
, Guatemala
Guatemala
Guatemala is a country in Central America bordered by Mexico to the north and west, the Pacific Ocean to the southwest, Belize to the northeast, the Caribbean to the east, and Honduras and El Salvador to the southeast...
and Nicaragua
Nicaragua
Nicaragua is the largest country in the Central American American isthmus, bordered by Honduras to the north and Costa Rica to the south. The country is situated between 11 and 14 degrees north of the Equator in the Northern Hemisphere, which places it entirely within the tropics. The Pacific Ocean...
. Although the Contadora was dissolved
Dissolution of parliament
In parliamentary systems, a dissolution of parliament is the dispersal of a legislature at the call of an election.Usually there is a maximum length of a legislature, and a dissolution must happen before the maximum time...
in 1986, the idea for Central American Integration remained, and its works were taken by the Esquipulas Peace Agreement
Esquipulas Peace Agreement
The Esquipulas Peace Agreement was an initiative in the mid-1980s to settle the military conflicts that had plagued Central America for many years, and in some cases for decades. It built upon groundwork laid by the Contadora Group from 1983 to 1985. The agreement was named for Esquipulas,...
, which, among other acts, agreed to the creation of the Central American Parliament. Members return 20-22 directly elected deputies to the Parliament. In spite of its efforts to promote the Esquipulas Agreement, Costa Rica
Costa Rica
Costa Rica , officially the Republic of Costa Rica is a multilingual, multiethnic and multicultural country in Central America, bordered by Nicaragua to the north, Panama to the southeast, the Pacific Ocean to the west and the Caribbean Sea to the east....
has not yet ratified and is consequently not represented in the Parlacen. Parlacen has been seen by some, including former President of Honduras, Ricardo Maduro
Ricardo Maduro
Ricardo Rodolfo Maduro Joest is a former President of Honduras and Bank of Honduras chairman. Maduro graduated from The Lawrenceville School and later Stanford University...
as a white elephant
White elephant
A white elephant is an idiom for a valuable but burdensome possession of which its owner cannot dispose and whose cost is out of proportion to its usefulness or worth...
.
Central American Court of Justice
The current mission of the CCJ is to promote peace in the region and unity between its member-states. Today's Court has jurisdiction to hear cases:- between member States
- between a member state and a non-member state which agrees to the Court's jurisdiction
- between states and any natural or legal person who is a resident of any member state
- regarding the integration process between Central American Integration System's (SICA) organs and member states or natural or legal persons
The Court may also offer consultation to the Supreme Courts of the region. In 2005, the Court ruled that Nicaraguan congressional reforms, which took control of water, energy and telecommunications services away from President Enrique Bolaños
Enrique Bolaños
Enrique José Bolaños Geyer was the President of Nicaragua from 10 January 2002 to 10 January 2007. President Bolaños is of Spanish and German heritage and was born in Masaya ....
were "legally inapplicable", possibly further inciting the Nicaraguan political crisis. As of July 2005, the CCJ has made 70 resolutions since hearing its first case in 1994.
System bodies
- Central American Bank for Economic Integration (Banco Centroamericano de Integración Económica, BCIE)
- Central American Common Market (CACM; Mercado Común Centroamericano, MCCA)
- Central American Court of Justice (CCJ)
- Central American ParliamentCentral American ParliamentThe Central American Parliament , also known as PARLACEN is a political institution devoted to the integration of the Central American countries. Its headquarters are in Guatemala City....
(Parlamento Centroamericano, PARLACEN)- Plenum
- Board of Parliament
- Secretariat
- Presidents Summit
- Comité Consultivo (CC-SICA)
- Council of Ministers of Foreign Affairs
- Executive Committee (CE-SICA)
- Vice Presidents Summit
- Secretariat General (SG-SICA)
See also
- Latin American Integration AssociationLatin American Integration AssociationThe Asociación Latinoamericana de Integración is a Latin American trade integration association, based in Montevideo. Its main objective is the establishment of a common market, in pursuit of the economic and social development of the region...
- Central America-4 Border Control AgreementCentral America-4 Border Control AgreementThe Central America-4 Border Control Agreement was a treaty signed in June 2006 between the Central American nations of El Salvador, Guatemala, Honduras and Nicaragua, establishing the free movement across borders between the four signatory states of its citizens without any restrictions or checks...
- Central America-4 passportCentral America-4 passportThe Central America-4 passport is a common-design passport issued by the Central America-4 Border Control Agreement member states . Although the design had been in use by Nicaragua and El Salvador since the mid-1990s, it became the norm for the CA-4 in January 2006...