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Brazil ‘trapped and isolated’ in Mercosur, should try trade agreements with US, says former president

Monday, December 3rd 2012 - 05:11 UTC
Full article 33 comments
Henrique Fernando Cardoso admits there were always fears of “US dominance” Henrique Fernando Cardoso admits there were always fears of “US dominance”

Former Brazilian president Fernando Henrique Cardoso said it was convenient to consider a trade integration with the Unites States given the very modest advances with Mercosur, where open trade has stalled or is far less than was expected when the original idea and is subjected to protectionist lobbies.

Cardoso who ruled Brazil from 1995 to 2002 and set the foundations for the current monetary and financial stability enjoyed by the country, said that “we were always afraid” of an integration with the US inside the Free Trade Association of the Americas, FTAA, a project strongly propped by Washington and the Clinton and Bush administrations and which encompassed all countries of the hemisphere with the exception of Cuba.

The former Brazilian president admitted with a strong quota of self criticism that for years “we cooked the idea with a very low fire and never actually moved to strengthen the idea of an FTAA”. The project finally succumbed in November 2005 at the Summit of the Americas in Argentina, when Lula da Silva was Brazil’s president.

At the Mar del Plat meeting, host president Nestor Kirchner and ally Hugo Chavez from Venezuela, together with the passivity of Brazil torpedoed the project and humiliated President Bush.

Looking back into history Cardoso asked, “maybe it’s time we review the situation and think if we are not in better conditions to assess with more latitude and ask ourselves what do we win and what do we lose with an FTAA?”

“We finally didn’t have a FTAA and after all we did not advance much” as was hoped but at the same time “we are trapped and isolated with Mercosur”, said Cardoso who added that the path to follow is that of Chile with its ‘globalization’ model opened to the world and trade agreements with as many partners as possible.

Unfortunately “Mercosur instead of advancing towards an effective efficient liberalization became prisoner of a system dominated by protectionism, sometimes by Brazil, but most of the time by Argentina” and its industrialization plans with a trapped market of 40 million unexposed to a healthy competition and subject to the different lobbies.

Categories: Economy, Politics, Brazil, Mercosur.

Top Comments

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  • ProRG_American

    This man has wants to do away with Brazils mega agriculture industry. Just wait until the US dumps subsidized wheat into Brazils economy.

    Dec 03rd, 2012 - 05:48 am 0
  • Troy Tempest

    You are talking nonsense.

    Dec 03rd, 2012 - 05:59 am 0
  • LEPRecon

    @1 ProRG faker

    If you were truly a US citizen you would surely see the benefit from trade with the US. Since you are an RG troll, you are jealous that Brazil is so much better off than Argentina, so will say and do anything to upset the apple cart.

    Mr Cardaso is looking at things from a sensible point of view.

    South American solidarity is one thing, but Mercosur is a rotten apple, that doesn't even follow its own rules, and appears to be dominated by Argentina, and very soon by the illegally incorporated Venezula.

    In the future they won't just be discussing trade, they'll be dictating the terms of those trade agreements, and finally dictating what a member country can or can't do.

    Look at how they've back-stabbed Paraguay. And for what? Because they impeached their President, followed THEIR constitution, and are now being 'punished' because the other countries don't 'like' the new President.

    That is the future of Mercosur, to make it easier for countries like Venezula and Argentina to impose their will on other smaller countries. It's a pity that Dilma has bought into this.

    All Brazil can do now is hope that you can contain matters, but I wouldn't be hopeful.

    Mr Cardaso also makes a good point that if there is no competition between companies and countries, then the consumer won't necessarily get the best value for money. In fact, the products are likely to be crap in a closed market because why should the manufacturers bother making quality products when they have a captive consumer client base?

    Hopefully Dilma will listen with an open mind to the opinions of her former peers, and make some sensible decisions. Especially as Brazil is on the cusp of becoming a major world power, economically, and it would be a shame to see them stopped from achieving their full potential by other members of Mercosur.

    Dec 03rd, 2012 - 07:08 am 0
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