Monday, May 20th 2013 - 19:47 UTC

Brazil trapped by Argentina and Venezuela economic mismanagements

Brazil’s main financial newspaper Valor Economico revealed that the recent summit between Presidents Cristina Fernandez and Dilma Rousseff from Argentina and Brazil was far from polite and enlightening, rather the contrary with “strong disagreements in the fields of trade and investment” shaking the foundations of Mercosur.

Cristina and Dilma, smiles and politeness, but that is not what happened behind doors

Under the heading of “Brazil and the neighbours’ crises, just next door” columnist Sergio Leo exposed the growing concern and disenchantment in the cabinet of President Rousseff with the economic situation of Argentina and Venezuela, Mercosur partners.

“Ideology sympathy was strong, geopolitical proximity also but what sends the shivers down the backs of President Rousseff and her advisors and inspires the recent good-will gestures towards Argentina and Venezuela is the economic deterioration of the two countries with which Brazil has its largest trade surpluses in Latinamerica”, writes Leo.

After a reference to the serious situation in Venezuela, the Brazilian columnist points out that “in Argentina politics and economy are not less worrying as shown by the parallel (‘blue’) dollar speculation outbreak two weeks ago, addressed with market interventions from the Central bank and the informal actions of the powerful Domestic Commerce Secretary Guillermo Moreno”.

The article then refers to the summit between Dilma Rousseff and Cristina Fernandez in Buenos Aires last month. “At the end of April, Dilma and Cristina held a very, very strong discussion, according to Brazilian and Argentine sources, because of the disagreements on trade and investment”.

Leo adds that even when after the meeting “both ladies made an effort with smiles and politeness” the meeting “left pending without resolution relevant issues for Brazil such as the elimination of Argentine Customs informal barriers, but also for Argentina, which is pressing for a loan from the Economic and Social Development bank of Brazil, for infrastructure works, such as railways and two hydroelectric dams”.

Dilma arrived to the meeting in Argentina with claims from the Brazilian mining company Vale that finally suspended a major potash development investment project in Mendoza (six billion dollars) because of the constant barriers and obstacles imposed by the Argentine and provincial governments.

The final decision of the meeting, according to Leo, was to leave those unresolved issues in the hands of their respective officials, while the coordination for a next bilateral at presidential level was left pending.

Regarding Venezuela, the columnist Leo says there is no positive climate for Brazilian investors since many Brazilian corporations have cancelled their operations and projects in the country.

“As the Brazilian authorities cautioned the Venezuelans, (President Nicolas) Maduro will need a less troublesome political climate, (as he is already implementing) to at least begin to attempt a reduction of the non functionalities of the Venezuelan economy” says Leo and recalls the meeting of Dilma with Chavez successor, during his first official round of Mercosur member countries visit.

“Forced to revert some of the decisions that made Chavez popular, to avoid a recession of the economy, Maduro is appealing to rhetoric in an effort to minimize the impact on his not so popular public image. In Brasilia however there was satisfaction with the slight change in the tone of Maduro’s speeches, still full of triumphalism rhetoric and conspiration theories, but now also with calls for a conciliation including with business people and the business community”.

In one of the final paragraphs columnist Leo concludes, “Brazil can’t remain as a mere spectator of the neighbours’ crises but must not act impulsively, motivated by the simplistic agendas suggested by incumbents and opposition. Dialogue with the leaders of the neighbouring countries is essential to extract practical and positive consequences. So far only expectations have been extracted, insufficient to distance pessimism”.

28 comments Feed

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1 Condorito (#) May 20th, 2013 - 07:53 pm Report abuse
You made your bed...
2 golfcronie (#) May 20th, 2013 - 07:57 pm Report abuse
CRISSIE must have had a hissy fit, not getting her own way. SHAME REALLY
3 Captain Poppy (#) May 20th, 2013 - 08:26 pm Report abuse
Ahhhhhhhh.......The South American heterordox model in action......Dilma should not get too pissed off and realize that her neighbors are working for total collapse.....and they are succeeding
4 Anbar (#) May 20th, 2013 - 08:27 pm Report abuse
its not true, all of Latam is united 110% behind CFK.

Think/Jose/Raul/etc said so.
5 Britworker (#) May 20th, 2013 - 08:30 pm Report abuse
6 yankeeboy (#) May 20th, 2013 - 08:31 pm Report abuse
As I have said MerSur is dead and will become the Alba South. Brazil and Uruguay better get while the getting is good.
7 Trunce (#) May 20th, 2013 - 08:31 pm Report abuse
'Bingo winglets' - a trend setter surely!
8 ChrisR (#) May 20th, 2013 - 09:12 pm Report abuse
Dilma is far from blameless with regard to the lack of international investment in Brasil and the slow down in the economy. She still has the liar Mantega as Finance Minister so how can she expect the credibility of Brasil to be any better than it is.

The position of Argentina is worsening by the day because of self-inflicted wounds and Maduro has yet to demonstrate he is anything other than an ex-bus driver and vindictive to boot..

In reality is anyone surprised by this turn of events: I thought it would have come before now.
9 Baxter (#) May 20th, 2013 - 09:23 pm Report abuse
It was well known that the April meeting was a complete mess ,after all Rousseff left a day early ! And now we add problems with Venezuela. For some time now it was clear that Argentina was going , in a big way , down the Bolivarian road . Did the people know this when they gave the Government such a majority at the last election ?
10 andy65 (#) May 20th, 2013 - 10:15 pm Report abuse
Where is THINK when you want him so he can explain this to us.
11 Troy Tempest (#) May 20th, 2013 - 10:53 pm Report abuse
Trolls are in 'Duck & Cover' mode.
12 Captain Poppy (#) May 20th, 2013 - 11:07 pm Report abuse
Last week the trolls hardly posted at all. I would say this might very well be a longer dry spell..........a very long strategy session is in the works here. Think of how hard is my be to defend this.........and try to believe what you are told to believe.
13 agent999 (#) May 20th, 2013 - 11:45 pm Report abuse
We will just see an increase in new sock puppets.
14 Captain Poppy (#) May 21st, 2013 - 12:57 am Report abuse
On top on this news for Argentina, now it is reported that 24% of Argentine families are victims of violent crimes. Where are the trolls today.
15 Troy Tempest (#) May 21st, 2013 - 01:59 am Report abuse
@14 Poppy

“. Where are the trolls today?”

In Canada, we are celebrating Queen Victoria's birthday, today.

She ruled over the largest Empire over the world.

Perhaps they're celebrating in reverence to her as well?
16 Math (#) May 21st, 2013 - 03:07 am Report abuse
@8 Well said.
17 toxictaxitrader2 (#) May 21st, 2013 - 08:50 am Report abuse
Brazil is the shining hope of LATAM it should disengage from the economic ignoramus,s to south and north.
Doe,s Argentina really expect to get a loan??with their record,they are truly delusional.
18 British_Kirchnerist (#) May 21st, 2013 - 09:36 am Report abuse
This looks like shit stirring by the financial press to me, even if its all true, fine, they'll be bumps along the way, but as even the first paragraph admits, ideological ties remain and national interests remain broadly aligned =)

#15 A lady who wore black for decades to mourn her dead husband, don't know if Elaine would attack her for that!
19 Captain Poppy (#) May 21st, 2013 - 10:05 am Report abuse
Troy I think it's become harder and harder to defend. Dilma see's the writing. As Mercosur fades into oblivion as a trade bloc, Dilma sents off on an official trade mission with the USA and soon the EU and even individual countries. It's obvious that Dilma does not want to path to ruin that Venezuela and Argentina has taken, so she acts on her own. Though, she can very easily fall into that same situation.
20 ElaineB (#) May 21st, 2013 - 11:04 am Report abuse
@18 Actually, yes, I would. She was a silly spoiled brat who almost brought about the end of the monarchy with her silly martyr act. I would call the obsessive mourning and victim act of Queen Victoria a mental illness. Fortunately she wasn't running the country so her petulance didn't really hurt anything but her own family. Have you read any of her letters, BK? Fascinating.

As to the article, you can try to sweep it away but the reality is that CFK's government has shit on its own doorstep and the doorsteps of all its neighbours. Never a good idea. Once the ASBO tenants are gone I am sure the neighbours will welcome the new inhabitants and harmony will resume.
21 andy65 (#) May 21st, 2013 - 03:57 pm Report abuse
@British_Kirchnerist You can't keep putting on a brave face love remember the old saying “it's like flogging a dead horse” kirchner's well beyond her sell buy date
22 briton (#) May 21st, 2013 - 05:55 pm Report abuse
poor CFK
butter fingers lol.
23 Captain Poppy (#) May 21st, 2013 - 07:13 pm Report abuse
Looks like the great CUNT of Argentina is after her enemies once again. I wonder if she gave Obama lessons? Only difference is Obama will get impeached for breaking the law.......and she is the Criminal in Chief
24 Dilmanator (#) May 21st, 2013 - 08:45 pm Report abuse
Dilma, Maduro, and the Future of Mercosur -
25 British_Kirchnerist (#) May 21st, 2013 - 09:24 pm Report abuse
#20 “She was a silly spoiled brat who almost brought about the end of the monarchy”

Shame she failed at that =)

#23 “Only difference is Obama will get impeached for breaking the law”

What do you mean - he'd be impeached if he ated the way (you think) Cristina acts, or do you actually expect him to become the first President to be successfully impeached? Don't see much chance of the latter
26 GeoffWard2 (#) May 21st, 2013 - 10:05 pm Report abuse
Dilma is too tied in to the 'Revolutionary Left' of Arg. and Ven..

Perhaps we will have to wait for a Nevez government to break the red ribbons that bind Brasil into the triumvirate.
27 Captain Poppy (#) May 22nd, 2013 - 01:07 am Report abuse
They are all sinking at an increasing rate.
28 British_Kirchnerist (#) May 22nd, 2013 - 09:09 am Report abuse
#26 Looks like you'll be waiting a long time for that =)

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