A common currency between Brazil and Argentina? Lula and Alberto Fernández are trying to revive the project, although there is some confusion in the results of the bilateral summit between the Brazilian president and his Argentinian counterpart regarding the results and achievements in economic matters.
The final declaration, signed by both presidents, said in no uncertain terms: “We have decided to move forward with discussions on a common South American currency to reduce operating costs and our external vulnerability.”
But four hours later, Brazil’s Finance Minister Fernando Haddad and Economy Minister Sergio Massa gave a different version, less ambitious than the one outlined by the presidents.
For both economic managers, what threatens “cooperation in the financial sphere” is an immediate and simple project – they said it could start in February – the payment of bilateral trade transactions.
Although the heads of state are being pressured by the political aspect of this issue, that is, the existence of a “common currency” that can expect maximum integration, ministers are concerned about the short term.
In Masa’s words, “we are talking about extending the existing credit line, which increases the term to 366 days. Brazilian companies benefit from automatic access to imports from Argentina; And it favors Argentine companies that can avoid the financial complications required by the SIRA regime.”
The Argentine minister added: “This is A Win-win For Brazilian and Argentinian companies, the Bank of Brazil, Banco Nación, and additionally, the Central Bank of Argentina, which is exempt from foreign currency payments in the short term.
Faced with repeated questions from Brazilian journalists about the risks that could arise from Brazil’s state-owned banks financing foreign trade, Haddad denied any danger: “There will not be any kind of vulnerability in Argentina because of export financing through letters. credit because they will have a guarantee fund. We have a guarantee fund which is a sovereign fund that will facilitate export letters of credit. Neither Banco de la Nación nor BB is subject to emergencies. For this reason, we agree to this system of Argentine guarantees.
According to the Brazilian government, at the center of the negotiations between the two countries “is the strengthening of the use of the local currency payment system (SML) to provide new tools to facilitate bilateral trade. It is a system that is already in place, administered by the central banks of the two countries, and which allows the use of reals and pesos for payments and collections.”
Nestor Kirchner Pipeline
The second issue was subject to future negotiations between technicians from both sides: financing by Brazil through BNDES and other entities of the second section of the Nestor Kirchner pipeline, which carries gas from Vaca Muerta, Argentina.
Massa acknowledged that it is necessary to work on this issue and for this purpose the Ministry of Economy will send a mission together with Banco Nación officials. The delegation will arrive in Brazil in the first week of February: “If the final destination of the gas is Brazil, as we mentioned, we will go to buy it, and in this sense, the gas itself is a guarantee. for investments. But they don’t necessarily have to be from the State Bank of Brazil; Resources can come from outside because the project is self-sustaining.”
Source: El Diario
