Former Brazil President Says Country Lost Its Leadership

Former Brazilian President Fernando Henrique Cardoso Latin America has never been so divided, Mercosur is but an illusion of integration and Brazil has lost its leadership and convergence capacity according to former Brazilian president Fernando Henrique Cardoso who ruled from January 1st 1995 to January 1, 2003.

In an interview with the newsletter from his political party PSDB (Brazilian Social Democracy), Mr. Cardoso is asked about the new "self denominated left wing leaderships" of Latinamerica such as Hugo Chavez in Venezuela, Evo Morales in Bolivia, Rafael Correa in Ecuador and Argentina's Nestor Kirchner.

"Latinamerica has never been so divided as currently. It has fragmented. Brazil lost its leadership. This was what happened in Bolivia (which nationalized all the assets of Brazil's government owned oil corporation Petrobras and hiked the price of natural gas), and now with Paraguay which is claiming higher prices for the electricity it sells to Brazil," pointed out the former president.

"We've lost spaces; Brazil has lost the capacity to search for convergence in Latinamerica," he added.

"Brazilian foreign policy is mistaken or non existent," underlined Cardoso who was President Lula da Silva's predecessor in the job.

"We've allowed Latinamerica to disintegrate. Mercosur (originally made up of Argentina, Brazil, Paraguay and Uruguay, and lately Venezuela) is today but an illusion, a caricature of integration. I think as Brazilians we've been quite mistaken," stressed Cardoso, who is now a visiting lecturer of several United States and French universities.

In related news it was announced in Buenos Aires that Mercosur and the European Union will resume free trade negotiations, possibly next September.

"The political will from both sides is there, and Europe has not lost interest in Mercosur," said the EU Deputy Trade Commissioner Karl Falkenberg during this week's visit to Buenos Aires.

Falkenberg held meetings with Foreign Affairs Secretary Jorge Taiana, Trade and International Economic Relations Secretary Alfredo Chiaradí­a and other top Argentine officials.

Chiaradí­a said that both sides had agreed that the best time to meet and discuss was next September, following the Doha Round multilateral trade negotiations.

"August is vacation time in Europe. If we mange to finally resume negotiations it will be September/October, when Uruguay will be holding the Mercosur six months chair", said Chiaradí­a who added that "we agreed it's going to be very hard to have a negotiations round before the WTO multilateral talks are over in July".



  • Show Comments (17)

  • AES

    Yeh couple of months ago a number of Bovespa stocks opted for the grade one of transparency. . .yeh you can also trade Brazilian funds in N.Y.

    I grew up with Swift, my father was a meat broker and an importer of beef back in the late 50’s of Australian beef to Oscar Meyer.

    I had not known previous to this year that Brazil was the largest exporter of live cattle on the planet.
    I thought Texas was, gitty up.

    But to now be the largest purveyor, packer of beef on the planet is Brazil’s coup, the Brazilian company being JBS.

    Its like saying that the U.S. is the largest producer of airplanes in the world. Eventhough the actual companies are Boeing or Northrop.

    Foreigners demand transparency, and as the shares of companies in Bovespa opt for this higher rating, the opportunity for manipulation diminishes.

    Enron was a good example of the impossibility of controlling fraud, manipulation and corruption. Insider trading ad nauseum. It is the nature of business. The closer you get to the source the better the information until you become the source.

    Brazil will, because it will make more money being honest, clean up its act, and its cast of characters. In the U.S. we already have one of the best police infrastructures in the world, dont fuck with the Law, unless your maybe from Macon county, but things have changed greatly for the positive.

    Brazil will not change overnight, it could, but it wont, the old guard like the Maoists of China are aging and dying. They are shifting to legitimacy. Their are always thieves, pirates and cheats in business. Look at building contractors and sub contractors. The trouble with Brazil is the courts. In the U.S. you’ll get your ass sued in a N.Y. minute if you fuck around.

    In Brazil, the system drags on for years, till somebody forgets or dies. Sounds like the tobacco companies, suits and appeals. By the time their is judgement, everyone is dead.

    I am watching Brazil from 30,000 feet, you are closer to the ground. And with children you are under entirely different preasure.

    I hate thieves, lying cheating misrepresenting. You are infinitely more savvy than these petty theives. In the U.S. we have real thieves. We also have real Law and real Police.

    Yeh Brazil is a risque, because of its failure of jurisprudence, but I see global money preasuring change. Even a crook understands it is better to make 10% of a billion dollars than 40% of a million.

  • AES

    Ch.c: So the price of iron ore will rise and so will the value of the stock of Compania Vale do Rio Coce
    SAO PAULO, Brazil: Continued growth in Chinese iron ore imports could lead to a shortage in the market this year, a top official with Brazilian miner Companhia Vale do Rio Doce said Thursday.

    Through April this year, China had imported 133.6 million metric tons (147.3 million tons) of the key steelmaking raw material, which projects to an annual rate of 400 million metric tons (440.9 million tons) in 2007, CVRD finance chief Fabio Barbosa said during a presentation for financial-market analysts.

    “If China continues at this pace, it will lead to a strong shortage in the iron ore market this year,” Barbosa said. “We don’t have the conditions to put an additional 20 million (metric) tons into the market.”

    CVRD previously forecast Chinese imports of 380 million metric tons (418.8 million tons) for the year. CVRD expects to ship 100 million metric tons (110.2 million tons) to China this year.

    “The market is tighter than we previously expected. There is no signal whatsoever of a slowdown in demand,” Barbosa said.

    One would conclude the price of iron ore is going up, sales will be constant and the value of the companies involved in its mining will have an increase in the value of their shares.

    Does not Brazil make 12.5% on its billions of reserves? $118.5 billion currently and growing.

  • AES

    No I have respect for Bo. I have learned a long time ago that people that do big things that have big responsibilities are worth listening to. They really know things, people, politics, money.

    It is difficult to be honest. There are an infinity of crooks in the jewelry business. It is a business of caveat emptor. But it is full of lying sharks that will tell you that a zircon is a diamond and if you cannot tell the difference either by specific gravity or feel or spectrographic analysis your screwed. They have microscopes that we use in the business that cost $5,000 just to look at a stone to determine its value.
    I am used to lying shits and do not like them, you can smell them.

    Many countries around the world have different ways of doing business. Bribes, gifts, girls. You dont have to do business in that manner, there are other ways of doing business, other people and other countries.

    I see Brazil as it is and as it is becoming. Shit it just bought Swift, it is now the largest meat packer on the planet. At a certain point dishonesty is not practiced. Sometimes when you need to sell to a buyer a small side of beef or a couple of ten thousand dollars will give you a contract with Wal Mart worth millions. So it is considered a cost of doing business.

    No police is a dangerous place to be in especially if you have children. Thats why they have private security companies and bullet proof cars. But who wants to live like that.

    Not the Venezuelans and no American. The people I know here are the best of the best, they know every mercedez or ferrrari or lambragini.

    I have no doubt that Brazil will achieve its inherent possibilities. Corruption is only one way of doing business, reminds me a little of Thailand. But corruption is small change. It does not produce greatness it produces petty tyrants like Marcos, or Chavez. You need a strong press that is not afraid of being killed for truth. Hard to find honor. You cannot buy it. It is a choice people make.

    You cannot be a killer of indians because you dont like them and want there land and be the largest distributor of meats on the planet. It means at a very subtle level that you cannot be trusted, if you are corrupt at one level, how can I trust you in another.

    I think there is a newer more intelligent generation of Brazilians, I have two nephews here that are studying at PUC, they are truly sweet kids, bright, honest, studying engineering.

    But Brazil has to do something about its law and order. If there is no order there is chaos. No body wants to live in fear of their lives or their childrens lives.

    If a thing has to be done it will be done. Money is logical, it can afford to be. The economy of Brazil has changed greatly in the past three years, I have been observing it for that period of time. Before that I just loved the music, Jobim, Gilberto, the rhythm of Ipanema. It is I have learned more than that, much more, it is transforming to modernism and all its ramifications. Most people in the world are honest, moral, when they wake to see there are more of them than the cheap petty gangsters, things change. This is a democracy, you can change events through the mechanism of democratic establishments. Things take time, a Brazil nut tree takes ten years to produce fruit. How long does a fear free, democratic economically successful Brazil take to bare fruit?

  • AES

    Bo: I do not see this as smoke
    Brazil’s Real Rises as Rebound in U.S. Stocks Buoys Demand

    By Ye Xie and Adriana Brasileiro

    May 30 (Bloomberg) — Brazil’s real advanced, reversing earlier losses, as a rebound in U.S. stocks bolstered demand for riskier emerging-market assets.

    “Risk assets performed well in the past few hours,” said Alexandre Lintz, a senior economist with BNP Paribas SA in Sao Paulo. “Investors are still confident about emerging-market economies in the medium term. That’s supportive for the real.’

    The real gained after stock markets in the U.S., Brazil, Argentina and Chile erased declines sparked by the biggest drop in Chinese shares in three months.

    The real rose 0.5 percent to 1.94 per dollar, the highest in more than a week. It reached 1.9329 on May 22, the strongest since January 2001, and has gained 10 percent this year, the biggest advance among the 16 most-traded currencies against the dollar. Lintz said the real may appreciate to 1.9 per dollar in two weeks.

    The Brazilian currency earlier declined after Chinese government’s decision to triple a tax on share trades prompted a 6.8 percent decline in Chinese stocks. A 9.2 percent slump in Chinese shares on Feb. 27 sparked a sell-off in emerging-market bonds and stocks on speculation slower Chinese growth will harm the global economy.

    “The decline was not as drastic as the February one,” said Enrique Alvarez, a Latin America economist at the research firm Ideaglobal in New York. “After the initial shakeout, the real came back. The currency continues to be well supported.”

    Inflation Report

    Brazil’s consumer, construction and wholesale prices, as measured by the IGP-M price index, rose 0.04 percent in the 30 days through May 20, the Rio de Janeiro-based Getulio Vargas Foundation reported today on its Web site. The increase was less than the median 0.08 percent increase estimated in a Bloomberg survey of 19 analysts.

    “The report is another piece of evidence that inflation is under control,” Lintz said. “Money will continue flowing into Brazil to buy bonds.”

    Brazil’s central bank bought dollars at 1.944 reais in an auction today. It didn’t disclose the amount it bought. The central bank has bought dollars every day in the currency market since July to stem the currency’s gains and support exporters. It’s also buying the U.S. currency in the futures market by selling reverse currency swaps.

    The yield on the Brazilian government’s benchmark zero- coupon bond due in January 2008 fell 1 basis point, or 0.01 percentage point to 11.43 percent, according to Banco UBS Pactual SA.

    To contact the reporters on this story: Ye Xie in New York at Adriana Brasileiro in Rio de Janeiro at

    Last Updated: May 30, 2007 17:10 EDT


  • AES

    Bo: A thing is true or it is not, I am not talking about the past, but the future. The future is now.
    The judgement of growth is based on the global value of the Real, international economic contracts, the value of Bovespa, and the amount of reserves.

    These are the only ways to tell whether a country is expanding or contracting.

    The perception of the economic stability, progress etc. is analyszed by Bloomberg, Fitch, Standard and Poors, not by me. The perceived credit worthiness of Brazil is done at a very high level.

    If Brazil at the end of the year is at 60,000, interest rates are down, and the economy is expanding, then whatever they are doing is worth copying by other nations, and they will.

    Smoke? Brazil just bought Swift, they are the largest processors of beef and chicken on the planet.
    They have established export contracts with China, Africa and most of the Middle East.

    There is a perceived reality to the value of Brazil’s economics. If this is smoke, hype, then the market will dictate the reality.

    Bovespa is 52,500. It is considered investment grade, and its planned economic expansions in ethynol, and soy as well as a variety of minerals is mere smoke and mirrors.

    When I perceive that it is as you say smoke, it will be time to get out of the market, and move on to land speculation in the U.S.

    I would rather have two percent of 100 bn dollars then ten percent of 10million.

  • AES

    Brazil leads through example of the possible, of an economic stability, differsity, and global integration that speaks more than discussions. Brazil is a way, if not the way to a United South America, a federation of independent states.

    Brazil continues month after economic month to demonstrate, sound fiscal and globally intelligent ,economically conservative expansionistic policy. Its economic alliances are independent and strengthen a span in the uniting of global enterprise.

  • João da Silva

    [quote]Name one first-world country in the tropics. [/quote]


  • Ric

    Name one first-world country in the tropics.

  • João da Silva

    [quote]I am betting that the the Brazilians are going to win 2 x 1.[/quote]

    I didnt win my bet nor lose it,since nobody else wanted to bet!. Time to have a Skol and celebrate.

  • João da Silva

    AES/Prof-Friendly Soccer match between Brasil and England
    I am betting that the the Brazilians are going to win 2 x 1.

    btw, where the heck is the Professor? Hope he hasnt turned to be a bounty hunter and taken off to Switzerland in hot pursuit of ch.c and bring him to Brazil and deliver him to the proper authorities here.

  • João da Silva

    Hoping that you can already read Portuguese reasonably well,I am posting a link below and I am sure you will find the news surprising as I did.


  • bo

    [quote]written by AES, 2007-05-31 16:06:08

    Smoke? Brazil just bought Swift, they are the largest processors of beef and chicken on the planet.
    They have established export contracts with China, Africa and most of the Middle East. [/quote]

    Brazil didn’t buy swift, JBS, a brazilian company, bought swfit. So what? They paid 200 million in cash and took on their BILLION dollar debt. That’s something that Tiger Woods could do on a couple years earnings from marketing contracts. Really doesn’t say much about anything if you ask me other than the fact swift was in trouble and a big part of those problems were caused by the thousands of illegals they were employing. Tell me, with FDA standards as they are in the U.S.(something brazil and many countries don’t come close to in the quality and packaging of their products), just how does JBS think they’re going to make it work….in the U.S.? Hire more illegal brazilians as swift had done previously? Now their ass is in a sling with the feds and ICE.

    [quote]Bovespa is 52,500. It is considered investment grade, and its planned economic expansions in ethynol, and soy as well as a variety of minerals is mere smoke and mirrors.[/quote]

    The problem with Bovespa, and everyone knows this, is that it does not have the strict “oversight” as other international markets have such as NYSE, FTSE, etc. If you’ve been paying attention to the news over the last 3-6 months you should have seen where a meat packing plant I believe was taken over and the stocks manipulated to a degree which could have never happened so easily as it did in this case in other markets. The Bovespa over the years has been a roller coaster and naturally is normally effected whenever big federal and corporate corruption scandals surface….which is basically on a monthly basis. How can one have confidence in a market, which naturally drives a market, when such drastic and blatent corruption scandals are a way of life? I’m an investor, my partners are investors, I may put as much as 10% of my net worth in Bovespa but never more than that, yet I wouldn’t have any qualms with putting 80% of my cash into the NYSE, NASDAQ, or FTSE, and all the investors I know feel the same way as myself.

  • João da Silva

    [quote]I think there is a newer more intelligent generation of Brazilians, I have two nephews here that are studying at PUC, they are truly sweet kids, bright, honest, studying engineering.

    Thanks for your post. Shit, AES, there was always a generation of Intelligent Brazilians.You could shake your hands and close a deal. Code of honor. For the past 10 years or so, we have become a nation that is afraid of ourselves (to quote you). We are afraid to demand from our elected,nominated and selected officials to fulfill their obligations for the salaries they make.It really bothers me.When I hear fo the students of USP and other Federal Universities that study at the cost of the tax payers money and yet occupy the RectorsÀ‚´s offices, I ask myself: Are we really promoting a new generation of honest Brazilians?.

    I still think that we need good and strong leadership that impresses on the youngsters that we are a great nation and we dont have to be afraid of ourselves but honest among ourselves and to the rest of the world.

    When I complimented Bo, I meant that there should be people like him,you,me, Forrest and hundreds of my friends who could look at greedy and corrupt people who abuse their power and are not afraid to say a loud NO to their demands.

    I think that Brazil still has hopes and not with the kind of constant and destructive tirades from people like ch.c

  • ch.c.

    “Money will continue flowing into Brazil to buy bonds.”
    Of course it will !
    As long as you pay the world highest interests rates after inflation for local currency borrowings, money will flow !
    Why should it stop ?
    The question one should ask is why are Brazilians so stupid ?
    And this despite 15 rates cuts.
    At the end, those penalized are the whole Brazilian society. And those rewarded are those who benefit from your stupidity !
    Yessss….interests are paid with……YOUR TAX MONEY !!!!!!

    Brazilians are so dumb that they applaude when they are taken for a ride by their own government !

    Lets face it, Brazil still pay TODAY around 9 % above the inflation rate while competing emerging countries offer
    FAR LESS. Just unheard of, even in poorer countries with a lower rating.
    Who is the dumbest, the ones who pay the lowest or the highest rates…after inflation ?
    Lets face it again, all that money is paid to local and foreign savers/speculators, instead of being spent for the benefit of the Brazilian society in healthcare, education and infrastructure.It also penalizes your exports an your overall profitabilty !

    The sad reality being that in 2003 your real interests rates were at 12 % above inflation and today at around 9 %.
    Thus taking the numbers of 26 % and 12,75 % BUT before inflation, as references, is just a dirty trick that your government
    use to show how they were clever.
    Yessssss they are quite clever to cheat on you, since you applaude them !

    No doubt that if instead of reducing your interests rates your central bank increase them, you will applaude louder !
    Right ?
    But local and world investors/speculators are dead right to caress your neck and tell you how smart you are, by paying them
    the best rates in the world, after inflation.

    Just think about it !

  • João da Silva

    [quote]When I perceive that it is as you say smoke, it will be time to get out of the market, and move on to land speculation in the U.S.

    I would rather prefer Bo to go national in Brazil and continue his enterprise of Constructing things. From what I have read from his posts, he seems to be aware,but unwilling to accept things like corruption,dishonesty, etc; that are prevailing in and trying to destroy our society.I commend him for that and also for the guts he has to fight against these and not selling all his assets and converting them into dollars at R$1.95/dollar and going back to U.S. From what I know, he seems to have created lots of jobs for the Brazilians (Architects,Lawyers,Engineers,construction workers,etc) and he pays his bloody taxes too. Why should Brazil lose such an entrepreneur?

    I think that future of Brazil depends on right thinking individuals who see the opportunities and invest here to better the lives of less endowed people. These people need not be necessarily Brazilians and could be of any nationalities,color or religion.Bo is asking a question that many Brazilians are doing: Is the Government paying respect to law abiding citizens and Businesses who pay their taxes, pay their employees correctly,etc? I respect him for doing so and my answer is a big NO.

    There is a big difference between Bo and ch.c. Bo passes his judgement on corruption, economy,etc; while living in Aracaju-SE and fighting the bureaucracy. On the other hand, Ch.c, lives in Geneva and declares that Brazil is a mud hole.

    So, my friends, lets build things and not be intimidated by the blood suckers.


  • bo

    written by AES, 2007-05-30 22:27:33
    Brazil leads through example of the possible, of an economic stability, differsity, and global integration that speaks more than discussions. Brazil is a way, if not the way to a United South America, a federation of independent states.

    Brazil continues month after economic month to demonstrate, sound fiscal and globally intelligent ,economically conservative expansionistic policy. Its economic alliances are independent and strengthen a span in the uniting of global enterprise. [/quote]

    Do you ever get tired of blowing smoke? “Sound fiscal and globally intelligent, economically conservative expansionist policy”???? LMAO! Yeah AES, the last two years brazil has only beaten HAITI in latin american and carribean countries in percentage growth. Ask Chile, Paraguay and Uruguay about brazil’s participation in Mercosur, ask them if brazil is playing by the same rules as everyone else.

    How in the hell can one know exactly how brazil is doing in terms of growth?? They use a different measuring stick than everyone else to make the appearance they’ve grown more than they actually have.

    When a country has huge percentages of their GNP going towards security and corruptions that’s quite a telling indicator in the overall “quality of life”.

  • João da Silva

    Matei a saudade do Falafel (stuffed with Bolinho de GrÀƒ£o de Bico). With your favorite Skol.Wonderful. I wonder if our friend Ch.c knows what Falafel means.

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