• Categories
  • Archives

Brazil and Mercosur Create Their Own Mini World Bank

Energy, infrastructure, human rights and support for Bolivian democracy were among the main issues addressed Sunday in the Mercosur presidential summit hosted by Paraguay and which ends today with the transfer of the group’s pro tempore chair for the next six months to Uruguay.

The presidents of the four full members of Mercosur, Nestor Kirchner, Argentina; Luiz Inácio Lula da Silva, Brazil; Tabare Vázquez from Uruguay and host Nicanor Duarte Frutos meeting Sunday in Asunción agreed to create a Structural Fund, which in the coming next years should accumulate US$ 1 billion. 

Brazil is expected to contribute 70%, Argentina 27%, Uruguay 2% and Paraguay 1%, with the Fund becoming operational next January.

The purpose of the Fund is to extend credits to country members for improving integration conditions by addressing infrastructure needs and existing asymmetries emerging from the different size and development degree of the regional economies.

Mercosur sources in Asunción revealed that talks for a natural gas agreement with Peru "are advancing," which should help create a regional "energy grid" in anticipation of increased future demand.

The accord would also help overcome shortage peaks as those currently experienced by most members because of insufficient rainfall, Argentina’s natural gas supply cuts to neighbors and political turmoil in Bolivia.

Peru is currently developing vast natural gas deposits in the jungle, Camisea I and II, with a significant percentage of output already contracted to Mexico and probably United States.

However reserves are considered sufficient enough for the building of a gas pipeline from Peru, extending to Chile, Brazil, Argentina and Uruguay and costing US$ 2.5 billion, which apparently will be financed by the Inter American Development Bank and announced in Washington during the coming week.

This huge operation should ensure a more reliable supply of natural gas, which has now been seriously interrupted because of the unstable situation in Bolivia, where politically active groups are demanding the nationalization of the industry and foreign corporations warning they will leave the country and begin international legal action if contracts are not respected.

Regarding Bolivia, which has seen two elected presidents ousted in the last two and a half years, Mercosur member countries, Argentina, Brazil, Uruguay and Paraguay, plus associates Chile and Peru, expressed their "support and full solidarity" to caretaker President Eduardo Rodriguez and the calling of new elections in the next six months.

The four Presidents also agreed on a human rights protocol, based on the Mercosur Democratic Clause, which contemplates the suspension of any member that does not abide by the democratic system.

The new human rights protocol also opens the way for suspension of a country member when there is evidence of "systematic and massive" acts of violence.

Monday morning is the official presidential summit ceremony when the agreements reached will be signed by all heads of state followed by the transfer of the Mercosur chair currently held by host Paraguay to Uruguay until the end of 2005.

Mercopress – www.mercopress.com

Tags:

  • Show Comments (0)

Your email address will not be published. Required fields are marked *

comment *

  • name *

  • email *

  • website *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Ads

You May Also Like

World’s Creative Industry Gets Headquarters in Brazil

Over one hundred representatives from several countries are meeting from Monday-Wednesday (April 18 to ...

Number 4: Brazil’s Petrobras Bigger than Coca-Cola, GE and Google

Petrobras, the Brazilian state-controlled oil and gas multinational ranked fourth in the list of ...

Brazil Calls Space Mission’s US$ 10 Million Price Tag Small Considering Benefits

Brazil’s Minister of Science and Technology, Sérgio Rezende, refuted criticism this Thursday, April 20, ...

When the US and Europe Failed Brazil Went to Africa, Asia and Elsewhere

Due to the financial crisis affecting the economies of the United States and Europe, ...

Brazil Readying Plan to Open Services Market to Foreigners

Brazil will conclude, until May 30th, the proposal in the services sector it will ...

Brazil Flirting with Deflation

The Cost of Living Index (Àndice do Custo de Vida) (ICV), in the city ...

Brazilian Development Bank’s Practices Raising Brazil’s Inflation

Luciano Coutinho, Brazil’s state development bank president, rejected criticism that record lending is placing ...

Thanks to Ethanol, Gas Is Turning into Alternative Fuel in Brazil

In Brazil, gasoline is rapidly becoming the country's alternative fuel as ethanol consumption zooms ...

Brazil Has a Huge Blind Spot in the Amazon Air Space. Here’s Proof.

A veteran air traffic controller from Brazil has shown on Brazilian TV, this Sunday, ...

Roberto Carlos at a time he was the uncontested king

Roberto Carlos: Brazil’s Old Idol Loses Majesty over Censorship

Roberto Carlos probably never read Oswald de Andrade, but still borrowed heavily from the ...