Uruguay, a small country that rarely makes headlines even in its own region, irritated its partners in the Mercosur trade bloc when it announced in July, ahead of the group’s semi-annual summit, that it had completed a joint study with China about the feasibility of a bilateral free trade agreement and that the two states are set to begin negotiations. Given that Uruguay’s population, 3.5 million people, is a mere one-quarter of 1 percent of China’s, such an agreement, if it is reached, will hardly shake the foundations of world trade.

But it does raise dilemmas for Mercosur, the Southern Common Market with four active members (Brazil, Argentina, Uruguay, and Paraguay), as its rules require that all members consent to any one of them signing a trade agreement with a third country. Such consent is not likely to be forthcoming; yet Uruguay still wants to move forward with negotiations, hopefully together with its Mercosur partners, but in any event, it is “unwilling to remain quiet.” But however this diplomatic gambit plays out, the affair highlights the disappointment which Mercosur has been since it began with great fanfare over thirty years ago, and the obstacles to serious regional integration within Latin America.

Mercosur originated in an optimistic era that seems impossibly distant now. Growth through increased international trade was the watchword of the “Washington consensus” of the international financial institutions. Regional trade groups were beginning to cohere. The United States had entered into a free trade agreement with Canada and was negotiating with Mexico, while other Latin American countries sought similar relationships with the world’s largest economy. At the same time, groupings in Africa and Asia were also emerging.

The often-heard buzzword was “open regionalism”—groups of countries would engage in deep integration among themselves and together negotiate agreements with other countries. One especially attractive model was the European Community, which had begun as a relatively loose, trade-oriented grouping and was moving to add new countries after the fall of the Soviet Union and would further consolidate internally as the European Union.