Mercosur or Mercosul is a trading zone among Brazil, Argentina, Uruguay and Paraguay. Its purpose is to promote free trade and movement of goods and peoples, skills and money, between these countries. Chile is in the process of joining, after resolving minor territorial disputes with Argentina. Other South American nations are seeking to join.
Many South Americans see Mercosur as a useful bulwark against the encroachment of the United States in the region, either in the form of the Free Trade Area of the Americas (FTAA) (a continent-wide successor to the North American Free Trade Agreement) or in the form of bilateral treaties, such as that currently being negotiated with Chile. But Mercosur was signficantly weakened by the collapse of the Argentine economy in 2002, and indeed some critics believe the refusal of the Bush administration to bail out Argentina was based on its desire to undermine Mercosur, which it saw as a threat to its divide-and-conquer strategy for maintaining its dominance the economies of Latin America.
Mercosur - The name comes from the Spanish words Mercado (market) and Sur (south).
Mercosul - The name comes from the Portuguese words Mercado (market) and Sul (south).