MercoPress. South Atlantic News Agency

Brazil calls on Argentina to integrate and consolidate world’s fifth largest economy

Dilma: “together we will be stronger”

The presence this week of Brazilian president Dilma Rousseff next to Cristina Fernandez at Argentina’s Industrial Union, UIA annual conference was considered a major integration success and highlights the growing interaction of the two leading Mercosur partners.

In her speech to an audience of an estimated 900 government officials and business representatives from both countries, President Rousseff called to work with “a true bi-national business mentality, leaving behind trade misbalances and thus build a new regional industry which helps consolidate the world’s fifth largest economy”.

“Our only option is more integration and more solidarity between the continent’s two major countries”, said Rousseff who called on industry leaders and politicians from Argentina and Brazil to be “more ambitious” and promote investment and cooperation in strategic sectors such as shipbuilding, auto manufacturing, nuclear and space development, infrastructure and energy, and technology research.

Integration between the two countries needs of a permanent dialogue between government and the business community, insisted the Brazilian president. “Together we will be stronger”.

The UIA conference was convened under the heading of “Argentina and Brazil: integration and development or primary production”. The two countries bilateral trade has soared to almost 40bn dollars and Brazil has become Argentina’s main business partner.

However the relation is not without bumps. Cristina Fernandez promised Argentina would make bilateral trade mechanisms more fluid, including ‘consultation policies,’ and less bureaucratic.

In her speech referred to the issue saying integration means an end to trade obstacles in direct reference to the restrictions imposed by the administration of Cristina Fernandez in an attempt to protect emerging Argentine industries, President Rousseff said they continue ‘to generate disappointment and frustration in Brazil’.

“We must overcome trade misbalances, for which we must build a credit channel to make integration more fluid and effective, and at the same time drop ‘personal rivalries’ so we can play a protagonist role in the world”, said Ms Rousseff.

Cristina Fernandez who closed the UIA annual conference said integration was both a need and a ‘defence mechanism’ against the world crisis. She added that Argentina and Brazil have become a family with ‘its problems’ but at the same time together can turn into the locomotive for regional development.

For the UIA and Argentine diplomacy the attendance of President Rousseff was an unexpected success and a very strong signal since the Brazilian leader will not be going to the Unasur summit on Friday and will be missing the taking office of President Enrique Peña Nieto in Mexico next Saturday.

“It is a clear demonstration that Brazil wants to consolidate its links with Argentina, a strategic relation”, said diplomatic sources surprised by the significant ministers and names of the government and private sector delegation that accompanied the Brazilian president.

Earlier in the week Argentina and Brazilian ministers met to address the different issues that continue to irritate the bilateral relations such as the new auto industry bilateral framework understanding. The Brazilian position, expressed with politeness, has been that Argentina should abandon car manufacturing and concentrate on efficient farming.

However Federal Planning minister Julio De Vido in his speech promised Argentine manufacturers that the government plans to invest 120bn dollars in infrastructure in the next five years to further promote the ‘re-industrialization’ of Argentina.

On textiles it was easier since the two countries have a common enemy: China.

Likewise for Brazil it came as a relief that Argentina seems willing to reach some sort of agreement with the non restructured bond holders, an issue which was becoming increasingly uncomfortable for the administration of Dilma Rousseff given the apparent initial intention of her peer not to comply with the rulings of the US courts.