The Integration Waze: the partnership between INTAL and Latinobarómetro and the region’s demand for integration

The popular smartphone app Waze tells you the quickest, least congested route for getting wherever it is you want to go. Few roads have been as winding as Latin America’s path to integration, which has involved progress and setbacks, bogus shortcuts, and even the occasional roadblock and picket line. So how can we work out the best route to integration?

The secret of Waze’s success is simple: it provides information on things that other people are doing that we weren’t previously aware of. It provides information on things that other people are doing that we weren’t previously aware of. If there is a traffic jam because too many cars are trying to use a particular street, the app recommends an alternative route. If a highway is clear, the app immediately suggests we take it.

This same principle of shared information is the cornerstone of the partnership between INTAL and Latinobarómetro (link in Spanish), which has identified the neuralgic points in the region’s demand for integration through 20,000 exclusive polls in 18 countries in Latin America and the Caribbean.

How close is a given country’s desired export profile to other countries’ expectations of this? How receptive to foreign investments is a given country that is seeking to attract capital? How willing are people to pay for better infrastructure in a country that has not made any major improvements to its internal logistics in recent years?

Let’s look at some examples to illustrate how useful this new tool is. A few months ago, Colombia began negotiations with China toward a free trade agreement (FTA). What outcomes have been seen in countries that already have FTAs with China? Latinobarómetro’s work shows that perceptions of China are particularly high in Peru, Chile, and Costa Rica, the three countries that have already signed FTAs with the Asian giant and where over 40% of the population expressed positive opinions of it.

Another example is beef, Argentina’s most prized export product. Do other Latin Americans rate it highly? Contrary to what might be expected, food is far from being one of the distinctive features that other Latin Americans associate with Argentina. Sports (80% of mentions) and tourism (41%) are the backbone of Argentina’s nation branding, while food culture is one of the features that people associate with Peru (79%). How can countries bring their nation-branding strategy in line with the economic sectors that they are actually trying to promote?

By cross-referencing analyses of public opinions with national statistics and data on trade, we can assess how issues such as trade agreements, investment agreements, nation-branding strategies, or immigration reform may impact integration policies and learn more about the objective and subjective consequences of these in other countries.

Cross-referencing subjective and objective data allows us to establish behavior patterns that form what we call the DNA of regional integration, an exercise that reveals connections between each country’s actual economy and the subjective opinions of its inhabitants. Without delving into causal explanations, this process reveals interesting correlations that function rather like an interactive map: they tell us where others were able to move forward and where they got stuck. The conclusions that this Waze for integration has reached are categorical:

• Countries which show greater support for integration also show greater support for democracy and higher levels of trust in their government.
• Countries with more concentrated export baskets show greater support for economic integration.
• Countries that prioritize investment tend to receive higher levels of foreign investment.
• Countries with greater infrastructure deficits are more willing to take on credit or pay taxes to finance infrastructure works to facilitate integration.
• Countries that value innovation more highly tend to have larger shares of exports with technological content.
• Countries whose populations prioritize the environment make greater use of alternative energy sources.
• Countries where people are more willing to pay for products that respect workers’ rights also have more equal income distributions.

At a time of rising protectionism, Latin America has an invaluable asset: 77% of Latin Americans support regional economic integration processes. The challenge ahead is how to build on this starting point to drive high-quality integration. With our sights set on this horizon, it won’t hurt to check the Waze of integration from time to time.