Brazil and Argentina towards a new cooperation. Work is underway on the single currency

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Expectations are growing in Argentina regarding the meeting between President Alberto Fernandez and his Brazilian counterpart, Luiz Inacio Lula da Silva, who arrived in Buenos Aires on Sunday accompanied by his wife, Rosângela, and Minister Mauro Vieira (Foreign Affairs). and Fernando Haddad (Finance). “Here in Buenos Aires I will work intensely to resume cooperation between Brazil and Argentina, one of the main markets for Brazilian industrial products, which is also Brazil’s third largest trading partner,” Lula wrote on social media. Among the long-awaited topics is the creation of a common currency, which “will not mean the end of the (Brazilian) real or (Argentine) peso,” Haddad specified.

Wisdom is also in the words of Vieira, who believes that the issue of the single currency is still “under discussion” and will in no way be a reality that will happen “in a short time.” And the Argentine president was more enthusiastic about the matter, as he assured yesterday to the Brazilian broadcaster Bandeirantes how “everything is easier with Lula because he believes in Mercosur. Fernandez added that the single currency is mainly dependent on Brazil, “because Argentina is very interested in implementing it.

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Argentine Minister of Economy Sergio Massa confirmed in statements to the Financial Times the idea, and explained that on the occasion of the meeting of the Group of Latin American and Caribbean Countries (CELAC) that will open in the next few hours in Buenos Aires, “a decision will be made to start studying the necessary criteria for a common currency, including This includes the financial and public finance aspects and the role of central banks. I do not want to create false expectations – he explained – but it is the first step in a long journey. I am convinced that Latin America must travel ».

The newspaper states that the currency in question will be called “sur” (which in Spanish means south), a name proposed last year by Luiz Inacio Lula da Silva during the election campaign that prompted him to lead Brazil for the third time. The announcement of the launch of the project should be made by the President of Argentina Alberto Fernandez and the Brazilian Lula himself, who will be together in the Argentine capital in the next few years for the summit of the Community of Latin American and Caribbean States.

Target

The aim of the regional currency, which should not replace the existing currencies of the different Latin American countries but operate in parallel, is initially to promote trade between the two South American giants, thus reducing the dependence of trade on the US dollar. Without having to dust off the idea of ​​a supranational currency ‘Bancor’, conceived in 1944 by Briton John Maynard Keynes, but rejected during the Bretton Woods conference in favor of the dollar, the example of South American leaders comes from the fore. of the euro in Europe in 2002.