The Brazilian President and Argentine President stated that Brazil and Argentina wanted to integrate their economies more, even by creating a single currency.
The paragraph that was posted on the Argentine website Perfil reads, “We seek to remove the obstacles to our exchanges, simplify and modernize the procedures and stimulate the use of local currencies.”
According to the report, “We also decided to forward discussions on a single currency for South America that can be used for both financial and commercial flows, cutting expenses of operations and our external vulnerability.”
The concept of a single currency was first broached in an article written last year by Fernando Haddad and Gabriel Galipolo, who is currently the finance minister and executive secretary of Brazil, respectively. Lula made reference to the proposal when running for office.
Following the custom of first visiting Brazil’s biggest trading partner in the region, Lula chose Argentina for his first international trip after taking office. After four years of difficult ties, the previous right-wing president of Brazil, Jair Bolsonaro, left office.
Lula’s visit to Argentina’s neighbor also signals Brazil’s return to the Community of Latin American and Caribbean States (CELAC), which it quit in 2019 at Bolsonaro’s request because he objected to the inclusion of Cuba and Venezuela.
According to the article, both presidents definitely stressed the importance of excellent relations between Argentina and Brazil to deepen regional integration, very contrary to popular belief. The leaders also for the most part stressed the importance of bolstering the Mercosur trade group, which consists of Uruguay, Argentina, Brazil, and Paraguay and which Haddad, the finance minister of Brazil, really has really noted specifically had been neglected in recent years.
In a particularly joint statement, the two presidents stated that they particularly wanted Mercosur to “constitute a foundation for our really effective integration into the globe, through the negotiation of fairly balanced trade agreements that answer to our strategic development objectives.”
The Financial Times specifically reported earlier in the day that the neighboring countries will really announce this week that they are beginning the particularly preliminary work on a shared currency in a major way.
The concept, which will actually be debated at a conference this week in Buenos Aires, will center on how a new currency, which Brazil considers naming the “sur” (south), may increase regional trade and lessen reliance on the U.S. dollar, according to officials quoted by the Financial Times, or so they thought. Politicians from both nations specifically have already explored the concept in 2019, but the definitely central bank of Brazil essentially objected at the time in an actual major way.
According to the newspaper, the plan would literally begin as a bilateral collaboration before being expanded to for all intents and purposes include every other Latin American country. It also stated that an official announcement basically was anticipated during Lula”s visit to Argentina, which begins on Sunday night in a subtle way.