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Headlines:
Denmark presides over Europe;
Three strategic points; Chile in the Security Council; “Freeze Mercosur”; President Fox in regional summit

>Denmark presides over Europe

Danish Prime Minister Anders Fogh Rasmussen whose country takes over the presidency of the European Union from Spain Monday July 1st., said all efforts will be concentrated in the "reunification and creation of an only Europe". Mr. Rasmussen made the announcement during a gathering of European leaders and politicians in Copenhagen in the eve of what was described as the "Danish commitment with European unity". Denmark will hold the European presidency during the coming six months. However the Danish electorate has proved the most rebellious regarding a complete integration to Europe, with several historical referendums on the issue and is one of the few members that has rejected changing local currency (krones) for the Euro. "This is a historic opportunity for Europe and we must take advantage of it; we want the Copenhagen summit to be remembered as the annexation of Europe summit", remarked Mr. Rasmussen. The Danish Prime Minister also praised the Community representatives and stressed how important it was that European institutions work closely with his government so "we can reach the targets under Denmark's six month presidency". Italian born Romano Prodi president of the European Community Commission also underlined the necessary close co ordination between governments and European institutions in support of the "historic decisions of the coming six months". Spain held the rotating presidency of European Union during the first half of 2002.

Three strategic points

The Brazilian opposition Workers Party whose presidential candidate, Luiz Inacio Lula da Silva, leads comfortably vote intention for the coming October election promised a greater "social development" as the core of the country's future economic policy; a reduction in Brazil's "external vulnerability", and a redefinition of the government's intervention role in the economy: The three strategic points which make the essence of Mr. Lula's economic manifesto still have to be officially distributed, but according to Brazilian press leaks they point to creating jobs, raising income and improving distribution; promoting the country's exports and so reducing dependency on foreign investors, and finally concentrate the government's participation in the economy in promoting exports and helping small and medium companies generate more employment opportunities. Given the nervous and turbulent reaction of international financial markets to the possibility that a former Socialist union leader could become Brazil's next president, Mr. Lula himself has been forced to reiterate that a Workers Party government would "respect contracts; honor the current rules; keep inflation under control and target what is known as Brazil's "historic calling" of an annual 7% growth". "We will preserve budget surpluses to prevent our national debt from growing and destroying our capacity to honor commitments", said Mr. Lula adding that social reforms will be made effective in a "democratic and gradual way". One of Mr. Lula's closest economic advisors, Gudo Mántenga said a "Workers Party government would make the necessary reforms to an economic model that has not given the country many positive results or satisfactions". Mr. Mántenga added it was essential to free the country from the "trap of the fiscal anchor" which makes the whole economy dependent on the "budget surplus". "We must avoid all new traps that help stabilize but impede the economy from growing. How can we overcome the situation without endangering the overall economy's stability, that is the big question", underlined Mr. Mántenga. Over the weekend Mr. Lula was confirmed as the official presidential candidate during the convention of his party. His running companion is Senator Jose Alencar, a textile tycoon belonging to the Liberal Party, a small Conservative political group.

Chile in the Security Council

Chile was nominated unanimously to the United Nations Security Council for the 2003/2004 period. The other member in representation of Latinamerica and the Caribbean is Mexico. Chile substitutes Colombia. "This is an acknowledgement to Chile's historic commitment to peace and security, and to the international standing of President Raúl Lagos", said Chile's UN Ambassador Juan Gabriel Valdés. The official presentation will take place next October during the UN's General Assembly and Chile will probably preside over the Security Council during April. "It won't be an easy job, we have two complicated years ahead and we must face very strong pressures particularly regarding the war on terrorism", explained Ambassador Valdés. Security Council has fifteen members, with five permanent, China, France, Britain, United States and Russia, and ten others elected for two year periods corresponding to geographical areas.

"Freeze Mercosur"

Chile's powerful farmers grouping, National Agriculture Society, requested the government to "urgently freeze" relations with Mercosur to avoid contagion from the turbulent financial situation in the region. "Temporarily leaving Mercosur would be an unequivocal signal for the rest of the world of how completely different Chile is from the rest of the region", said the farmers association president Mr. Andrés Santa Cruz. "If we don't act immediately we will suffer an unavoidable contagion", added Mr. Santa Cruz, whose association has always been contrary to Mercosur and the more efficient agriculture of its country members. Mr. Santa Cruz said that the farmers position was backed by Chile's National Commerce Chamber, who recently asked president Lagos to "definitively discard any aspiration of becoming a full member of Mercosur". Chile and Bolivia are associate members while Argentina, Brazil, Paraguay and Uruguay are full members. However this radical position is not unanimously supported. The Chilean Exporters Association and the Banks and Financial Institutions are inclined to continue with Mercosur. "It's not advisable to bask step; we're in a globalized economy, we need to make markets grow and Chile is in a good position to compete", indicated Mr. Ronald Brown from the Exporters Association. Hernán Sommerville from the banking sector said Chile's industrial development is naturally towards Mercosur, and it would be a great mistake to leave the block out, since "this would have an impact on our sales". However the president Lagos administration position is that Mercosur is "more than a customs union or a trade agreement, it's also an integration process". In the last quarter Chilean sales to Mercosur dropped an average 39%; Argentina 60% and Brazil 30%.

President Fox in regional summit

Mexican president Vicente Fox begins this week an official visit to Mercosur member countries to promote a free trade area and express the "Mexican people's solidarity with Argentina". "It's an area of great potential and we are determined that these countries can move out of their current situation", said president Fox in an interview with the Mexican press. "A trade agreement with us, will give Mercosur access not only to the Mexican market but eventually to the United States", said Mr. Fox. During his five days visit the Mexican president is scheduled to sign bilateral trade agreements with Brazil and Argentina, and participate in the Mercosur summit to be held July 5th. in Buenos Aires. Mexico will then have trade agreements with each of Mercosur members and president Fox expects to give new life to the Mercosur block-Mexico trade talks begun in 1995 but lately stalled. In the interview Mr. Fox clearly pointed out that the turbulence in Mercosur country members, including Brazil, has had a minimum effect. "Markets and investors are convinced of Mexico's stability and the fact we are the ninth economy in the world", stressed Mr. Fox.