More Trade and Less Protectionism, Brazil's Recipe to Save the World

Presidents Tabare Vasquez and Lula Following a meeting Tuesday with visiting Uruguayan President Tabare Vazquez, Brazilian President Luiz InĂ¡cio Lula da Silva said that relations with neighboring Uruguay are at "their best level ever."

"Our privileged association is crucial to keep advancing Mercosur," said Lula standing next to Vazquez. "We must find new innovative ways to overcome the lack of sufficient credit and accelerate discussions on the use of our local currencies in bilateral and regional trade," he added.

The Brazilian president also pointed out the significance of "solidarity" between Uruguay and Brazil in energy affairs and called for mechanisms to address shortages as well as promising more investments from Petrobras in Uruguay.

President Lula announced his government guarantees the link between the Brazilian and Uruguayan electricity grids and promised a new plant to be built in Rio Grande do Sul to connect directly with San Carlos in Uruguay.

The Uruguayan delegation, which included several ministers, is interested in a strong long term Brazilian demand since Latin America's largest economy has become Uruguay's main trading partner.

The global financial crisis is forcing on countries the challenge of finding new innovative ways to overcome the shortage of credit and expand world trade, said both presidents who called for a quick completion of the Doha Round for a further liberalization of world trade in the framework of the World Trade Organization.

"This is why it's so important to strengthen Mercosur, a crucial step in the path to consolidate the customs union and to agree on the elimination of the double foreign goods tariff charge."

Protectionism had a special emphatic criticism from President Lula who underlined that countries to combat the current crisis need more integration and better tools to combat those tendencies.

"Currently whoever believes he can save his country with protectionism will be rapidly condemning his country's economy, in the mid term. I'm convinced that what we most need is more trade, more trade, so the global economy can return to normal," said Lula.

Mercopress

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