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Brazil’s Lula Calls on US and EU to Finance Production and Then Buy Biodiesel

In his weekly radio broadcast, this Monday, February 13, Brazilian President Luiz Inácio Lula da Silva spoke of the Progressive Governance Summit that he attended in South Africa on the last stop of his five-day trip to Africa last week.

Lula used the summit to once again call for reduced farm subsidies in rich nations, which would permit poorer nations to export their agricultural produce.

Heads of state from the United Kingdom, New Zealand, South Africa, Ethiopia, Sweden and South Korea, along with the head of the World Trade Organization, Pascoal Lamy, and the EU trade negotiator, Peter Mendelson, participated in the summit.

Lula also suggested that biodiesel could stimulate growth in poor nations. He said rich nations could finance its production and then buy the product, creating a mutually beneficial rich-poor nation relationship.

Lula added that it is becoming more obvious to all that poor nations can contribute to world trade, as well as science and technology. He said Brazil was willing to assist the less favored.

The radio program this week was recorded on the presidential aircraft as it returned to Brazil Sunday night, February 12. During his stay in Africa, Lula visited Algeria, Benin, Botswana and South Africa.

Agência Brasil

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  • Guest

    OIL AND BIOFUELS !!!!!!!
    Let me smile ! Contrary to what the world believes, there is no shortage of oil.

    There was a mutual agreement that we are depleting the actual proven reserves with the actual world high needs ! Therefore a higher price had to be established in order to accelerate the findings of new production…but at a higher cost as more difficult to find and extract from a deeper depth. BUT OIL THERE IS PLENTY PLENTY…just not as cheap as before.
    Biofuels, as good as they are will not survive, and if they do is simply because producers and dealers will use the trick of : less polluting and more environment friendly than oil.

    On the other hand no one should forget the nuclear plants and hydroelectric plants. At one point in time the americans will again build these plants. they did not build one nuclear plant in the last 30 years but that could very well change.

    No one should forget afterall that TODAY…France is producing over 75 % of all their electricity needs with NUCLEAR PLANTS !!!!! And they also stopped building new plants years ago already !
    TODAY…Brazil is producing most of their electricity needs with hydroelectric plants and intend to build more.

    All these new investments going or that will go into biofuels just remind me similar investments in TEAK projects, OESTRICH RAISING, JOJOBA GROWING, OR EVEN TULIPS BULBS …CENTURIES AGO !!!!!
    THE PROBLEM IS THAT 99 % OF THESE PROJECTS WENT….BANKRUPT… BECAUSE NON PROFITABLE….BY DEFINITION.

    Even Brazil already failed miserably once…not so long ago with their sugar cane fuel !!!!!!!! No souvenirs ????? smile

    But obviously….this time is different…every one say ! smile….
    They already said the same in the past ! Curiously it was also exactly when the price of oil more than quadrupled in the 1970’s !!!!
    And by now the oil price also quadrupled again in a few years time. !!!! Hi hi !!!!!!
    And why their sugar fuel collapsed then ! simply because their industry decided to not transform anymore their sugar into fuel…because they made more profits by transforming the cane to sugar again, in view of the high sugar price.
    What is happening now ? sugar is at the highest price in several decades, not only because of biofuels but world demand of…. sugar !!!!! Hi hi !!!!!!

    Why should anyone believe that there wont be a world recession within the nex few years, and that would not put the oil price down sharply ????? Can anyone imagine China growing at the same rate for 10 or 20 years ?????? It all depends of the USA…their largest buyer, by far, of Chinese products, not from the Chinese themselves !

    Could be that the U.S.A. already have the first signs to be at a peak by now. .Time will tell.

    Cycles are cycles ! Nobody can escape them. And fashions just follow the trends….up when it is up…..and down when it is down ! But fashions change for sure…just like the waves of cycles !

    Could very well be that it is all….du déjÀ  vu !!!!!! -;-)))))

  • Guest

    THE US AND EU CAN AND ARE COMPETITIVE !!
    JUST LOOK AT BRAZIL : all their farmers are struggling by now….in view of the agricultural prices…..WHICH ARE NOT THAT LAW AT ALL ! THEY HAVE DIFFFICULTY REPAYING LOANS AND EVEN INTERESTS ON THESE LOANS.
    Brazil also subsidizes their agriculture with tons of cheap loans at 9 % when the governemernt must borrow at 17/18 %.
    the difference is even bigger when you compare to any bank loans rates one has to pay : 40 to 70 %.and as much as 150 % ON OVERDRAFTS…….. when farmers and all export industries get loans at 9 % or so through the BNDES…WITH EVEN GRACE FOR REPAYMNENT TIME !

    NO ONE SHOULD EVER FORGET THAT THE REAL COST OR PENALTY THAT THEY HAVE IS WHAT THEY CALL THEMSELVES .

    CUSTO BRAZIL !!!!!!!!!

    That is corruption, red tape, bureaucracy, archaÀ¯c working laws, cost of transportation and storage due to lack of infrastrucuture !!!

    Finally Brazil could even subsidizes more their agriculture if they wished, but they cant because they are also subsidizing ALL their export industries.

    In the EU and the U.S. we subsidize ONLY agriculture. But the results will be the same if we reduced agriculture subsidizes but increased ALL EXPORT INDUSTRIES…..AS BRAZIL DOES.

    THAT IS ONE OF THE REASON, BUT NOT THE ONLY ONE, WHY BRAZIL DOESNT WANT TO NEGOTIATE ANYTHING ELSE BUT ONLY AGRICULTURE AT THE WTO , BUT NOT MAUFACTURED GOODS AND FINANCIAL SERVICES WHERE THEY DONT COMPETE EVEN BY SUBSIDIZING THESE INDUSTRIES !

    AGAIN, DESPITE WHAT THEY PROCLAIM, THEY ARE NOT COMPETITIVE AND WE SHALL NOT BE AFRAID OF THEM !

  • Guest

    And no doubt…..
    …that Lula want low financing cost but very high selling prices of his biofuels….so the minority wealthy brazilians can get richer,,,and the majority of poor brazilians will remain even poorer. thjen Lula will even say…look how this is unfair from the developed nations !

    Brazil can finance all their projects if they had a good tax collection rate.
    Unfortunately only 10 % of the active workforce there pay income taxes.

    It happens that in all developed countries the worker with an average salary has some income taxes to pay.

    It also happens that in Brazil, the national average wage is Reais 985.- per month BUT that all those below Reais 1270.- DONT PAY INCOME TAXES. THEREFORE THERE YOU NEED TO HAVE A HIGHER THAN AVERAGE NATIONAL INCOME TO JUST START TO PAY TAXES ON INCOME !!!!!!

    IS THAT FAIR……FOR THE 50 % OF POPULATION HAVING JUST ONE OR LESS MINIMUM WAGE OF REAIS 340 ????????

    IS THAT FAIR THE INCOME TAXES PAID BY AN AVERAGE WORKER IN DEVELOPED NATIONS MUST FINANCE THE BRAZILIAN WORKER WITH THE AVERAGE NATIONAL WAGE ?????

    NOOOOOOOOOOOOOOOOOOOOOOOOOOOO !!!!

  • Guest

    Requesting financing…..
    ….and then spitting on those who financed is typically Lula’s style !

    Just look on how he spitted on the IMF after having been financed by them for decades !

  • Guest

    Agree not Mutually Benefical
    Lula’s proposal may work for Europe but not the U.S.. The U.S. is already the 2nd leading producter of Biodiesel next to Brazil. Soon the U.S. will surpass Brazil in production. The U.S. doesn’t have a production issues as there are many U.S.and Canadian companies preparing to ramp up production capacity by 1000%. The U.S. problem is distribution (Ethanol supporting gas stations). This will require direct investment into the U.S. market. The second problem is the demand it is speculative but seems promising. Both GM, Ford and Honda will be building E85 vehicles for 2007. The biodiesel caveat is that the U.S. is on record saying they will remove farm subsidies when the EU agrees to doing it. That is why Brazil is pressuring Tony Blair. The real problem is France. But back to the U.S. Once subsidies are removed (5-10yrs away), the U.S. and EU could never compete against the cheap labor of Brazil and Africa. It will be corn, sugar, soybean and switch grass that U.S. farmers will produce for Bio fuels as an alternative. A WIN WIN for everyone.

  • Guest

    Mutually Beneficial
    Lula’s proposal for rich countries to finance production of biodiesel fuels in other countries such as Brazil and then buy it from those same countries is completely non-mutually beneficial. I would love for someone to give me money to start my own business and then they also buy my product. Sign me up. Lula’s proposal would be great for Brazil if some countries would bite. Also isn’t the financing of a industry a subsidy. A little hypocritc when Brazil is at the forefront of asking Europe to remove their subsidies. Who know maybe it couldd work. Energy dependence on Brazil is much better than dependence on the Middle East.

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