Lula and Chavez Tie Economic Knots

Brazilian President Luiz Inácio Lula da Silva arrives today for a state visit to Venezuela when he will be signing with his counterpart Hugo Chavez a strategic cooperation agreement encompassing several fields.

These include energy, telecommunications, construction, aviation and agriculture, which will help “to deepen the bilateral relations and regional integration”, said Venezuelan Deputy Foreign Affairs minister Eustaquio Contreras.


An important forum of businessmen from both countries will be celebrated parallel to the presidential summit, which officially begins next Monday with a private meeting in Caracas Government House, Miraflores Palace.


The Brazilian Foreign Affairs Ministry in a release indicated that the meetings will be centered in defense and protection of the Amazon basin, which both countries share; electricity generation; oil and gas exploration; petrochemicals; ethanol and biodiesel production plus coal extraction.


Other cooperation sectors include steel, science and technology, infrastructure projects, trade promotion, telecommunications, social communication, fisheries and agriculture development.


Brazil also expects a greater share of a significant arms renewal program and massive capital investment projects undertaken by the Chavez administration boosted by Venezuela’s additional oil earnings.


Among these figure selling Tucano training aircraft to the Venezuelan Air Force and Brazilian participation in the building of a two bridges over the Orinoco river; the third and fourth lines of Caracas expanding metro network; a hydroelectric dam and an extensive irrigation project targeted to make Venezuela self sufficient in food supply.


Venezuela ranks among the five leading oil exporters of the world and is a main supplier of the United States.


This is the sixth time the two most popular South American left leaning leaders meet in two years but in spite of grandiose projects they don’t necessarily coincide in the way they address economic and international affairs.


President Chavez has become ever more radical and populist while President Lula da Silva is increasingly popular among bankers and businessmen for his orthodox approach to financial and economic affairs.


Actually in a recent Social Forum held in Porto Alegre, Brazil, Mr. Chavez was hailed as a hero but Mr. Lula da Silva was booed for his flirting with “capitalism” and his yet to be honored electoral left wing promises.


Mr. Chavez, a close friend of Cuba’s Fidel Castro has replaced the former Brazilian union leader as a reference point for the radical left in South America.


Similarly, internationally the Lula da Silva administration has good relations with the United States preferring pragmatism over ideology, and Mr. Chavez has said his strategy is to break the US axis and forge South American unity.


MercoPress
www.mercopress.com

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