MercoPress. South Atlantic News Agency

UK, Mercosur's main ally in EU trade talks.

The United Kingdom is Brazil's main ally in trade negotiations with the European Union, particularly regarding agriculture, said British Ambassador Roger Bone who leaves the country at the end of the month.

"Particularly in sensitive areas such as agriculture, UK would like to see progress in negotiations, but it's hard to convince our European partners", admitted Sir Roger in an interview with the Brazilian newspaper O'Globo.

"We're constantly arguing in favour of more flexibility concerning agriculture, and in this process we're Brazil's best ally in the EU", added Sir Roger in direct reference to the current EU-Mercosur negotiations. However Sir Roger was not so enthusiastic about UK-Brazilian bilateral trade.

"In 1999 UK represented 2,5% of Brazilian foreign trade, and five years later the figure is now 3,5%. I think we could have been more active; all ambassadors keep watch of statistics and like to see them advance vigorously. However I'm optimistic given the clear signals of Brazilian macroeconomic consolidation".

Sir Roger said the first steps in that direction have already taken place particularly in the oil and gas industry. Shell was the first foreign company to extract oil in Brazil following the end of Petrobras monopoly, 14 British services companies have established in Brazil and over a hundred UK business delegations visit the country annually.

"And this will be particularly effective following the coming October Rio Oil and Gas, the largest show of the industry in Brazil with over 60 British companies present, the most numerous delegation, including Energy Secretary Stephen Timms", revealed Sir Roger.

But the outgoing British Ambassador also indicated that British investors are concerned with regulations. "In the gas and oil industry, investments are substantial and long term, and depend on fiscal and regulatory stability".

Finally Sir Roger praised the "determination" with which the current Lula da Silva administration tries to balance social issues and economic stability, and this is being achieved with a really "admirable cabinet of ministers".