By Fareed Zakaria, CNN
Last week saw the debut of a big new regional alliance. Thirty three countries came together to promote relations in the Americas. But, guess what - America itself (that is, the United States of America) was missing. And that was the point.
What in the World is going on?
To explain, let me tell you a bit more about the summit. It's called "CELAC" - a Spanish acronym for "the Community of Latin American and Caribbean States." It was held in Caracas, Venezuela, and the organizer was none other than that perennial America basher - President Hugo Chavez.
With great fanfare, Chavez proclaimed the summit to be the region's most important political event in more than a century - there would now be
complete "independence" from American interference.
Chavez made a point of hosting Cuba - a country he subsidizes, and one with which Washington has no formal relations. He also read out a letter of congratulations for creating the new regional bloc - the letter was from Hu Jintao, China's president.
Venezuela's attempts to irk Washington are not surprising. But don't expect too many countries to follow his lead. What the CELAC summit has really highlighted is how divided Latin America is. Haiti and Honduras have very little in common with Argentina and Brazil. Venezuela and Cuba have a completely different set of foreign policy goals from that of Mexico and Colombia.
There is little sense of a shared political or economic agenda. And, in any case, there already exists a number of regional groups. Brazil heads up the Union of South American Nations, or UNASUR. Then there's the OAS, or the Organization of American states. But that's led by Washington, and it excludes Cuba.
What struck me as odd though, is why the leaders of strong emerging markets like Brazil and Mexico are giving Mr. Chavez a platform to peddle his failed ideas - ideas that none of them are following. Remember, this is a man who has somehow managed to lead his oil-rich country to 30% inflation, a contracting economy and mass poverty - quite a feat.
Meanwhile, his neighbors have turned South America into a rising economic force. The continent grew by 6% last year, and is on course to grow by 5% this year. Its countries have low ratios of public debt and its growth is increasingly driven by the consumption of the millions of new South Americans entering the middle class.
These are the factors that give its leaders the confidence and swagger that you now see at regional summits. But there are worrying signs of speed bumps ahead. By some estimates, regional growth will slow to 3.2% in 2012. There are real challenges that have to be met - the region has high inflation, low labor productivity and still too many subsidies to various inefficient sectors of the economy.
The slowdown is best evidenced by the performance of its biggest star, Brazil. Last week it reported its economy actually contracted in the last quarter. One more such quarter and it enters a technical recession.
The good news is that Brazil has the means to come out of it. But to do that it needs to enact a new set of reforms, opening up its economy to boost productivity - in other words, to do the opposite of what Hugo Chavez's model represents. Perhaps that's why the presidents of Brazil and Argentina didn't stick around for a second day of the Chavez show. They took an early flight out.