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This paper seeks to contribute to the study of contemporary South American regionalism focusing on the emergence and development of sectoral cooperation and policy coordination within the Union of South American Countries (UNASUR). To do so the paper analyzes two policy areas ?transport infrastructure and energy integration? from the inception of cooperation in 2000 until 2014, addressing two questions: (i) why regional cooperation has emerged despite the absence of economic interdependence and market-driven demand for economic integration, and (ii) why policy outcomes are evident in some areas (i.e., transport infrastructure) while limited in others (i.e., energy). Bringing together insights from rationalist and constructivist approaches in IR and IPE, it is argued that the emergence of regional cooperation as well as the sharp variation in policy outcomes between areas can be largely explained by the articulation of a regional leadership and its effect on the convergence of state preferences. The paper shows how the Brazilian leadership, incentivized by the effects of the US-led FTAA negotiations and the financial crises that hit the region in the late 1990s, made state preferences converge towards a regionalist project encompassing all South American countries by making visible the mutual benefits of cooperation on transport infrastructure and energy. Furthermore, the paper illustrates how in spite of significant changes in South American states’ cooperation preferences the Brazilian leadership was able to adapt the cooperation process in the transport infrastructure sector to the new circumstances of regional politics permitting not only the institutionalization of sectoral cooperation, but also the implementation of several infrastructure transnational projects. In the case of energy, instead, the emergence of a second regional leadership project –pursued by Chavez’s Venezuela – and the deep divergence of state preferences led energy cooperation into a gridlock.

Constructing Regionalism in South America: The Cases of Transport Infrastructure and Energy within UNASUR