Brazilian President in Uruguay in Effort to Strengthen Mercosur

    Presidents Dilma Rousseff and José Mujica

    Presidents Dilma Rousseff and José Mujica Brazilian president Dilma Rousseff went this Monday, May 30, to Montevideo, capital of Uruguay, for a one-day visit to that South American country. Rousseff and president José Mujica of Uruguay are personal friends who were both left-wing militants in the past. Mujica, at 77, is fifteen years older than Dilma.

    Both were arrested and tortured by military dictatorships in the 1970s. Dilma was in prison for three years, Mujica spent more than a decade behind bars and they have championed the struggle for human rights and better quality of life for the poor throughout their careers.

    Dilma’s trip to Uruguay is part of a political and economic effort to strengthen the Southern Cone Common Market (Mercosur – Argentina and Paraguay are also in Mercosur). She will also want to take advantage of a boom in the neighboring country. Growth of GDP in Uruguay has recently been the best since the Second World War.

    Brazil’s principal exports to Uruguay are crude petroleum, auto parts, chemicals and some food items.

    Rousseff has negotiated partnerships with Uruguay in the area of infrastructure, including the production of software and energy.

    The two countries are discussing the building of transmission lines and bridges, along with repairing railroads. Brazil and Uruguay wish integration in very practical terms: more bridges and railroads connecting the two countries.

    Dilma visited the Uruguay Technological Laboratory, one of the most advanced in South America. She and Mujica signed around a dozen agreements in areas including science and technology and education.

    Uruguay, once known as the Switzerland of South America, with high levels of education and living standards, has seen much of its better-educated population leave the country for over more than a decade.

    They left to find jobs with higher salaries and better living conditions abroad. Dilma and Mujica are hoping to reverse that trend by creating a solid economic integration of the supply and production chains in both countries.

    After China and Argentina, Uruguay is the third country to be visited by the Brazilian president, since taking office last January 1st. The two countries are founding full members of Mercosur and Brazil is Uruguay’s main trade partner.
     
    Brazilian ambassador in Montevideo, João Carlos Souza-Gomes described bilateral relations between both countries as “excellent” and underlined the new approach to the dozen agreements which includes scientific and technology issues to the more traditional referred to trade and integration.

    “The fact that when President Rousseff took office President Mujica went to Brazil with a delegation of all Uruguayan political parties including those from the opposition had a most positive impact in support of the bilateral relations and agreements to be signed and in the future,” said Ambassador Souza-Gomes.

    The two presidents discussed several initiatives and infrastructure projects geared to make possible an integrated development of northern Uruguay and the southern half of Rio Grande do Sul state, among which the construction of a new bridge, railway interconnection, alternating complementary power links and the launching of a Uruguay-Brazil water way along border lagoons and fluvial resources connecting with the Atlantic ocean.

    Besides infrastructure the two countries are expanding their cooperation to science, technology and innovation including digital television, interactive connectivity with the purpose of granting universal access to wide band and advanced software and nano-technology.

    Brazil has consolidated as the main destination for Uruguay’s exports, particularly manufactured goods and also the country’s main provider. Bilateral trade in 2010 was over US$ 3 billion US dollars, up 19% from the previous year and is relatively balanced for both sides.

    “The alliance between Uruguay and Brazil is not because of a geographic circumstance, much less a bureaucratic construction, we have common and complementary interests”, said the Brazilian president.

    “Our societies share values that are supported in solid and caring historic links. From there comes the fundamental strength that supports our common integration project both bilateral and regional”, added Ms Rousseff who underlined the “positive historic moment of solid economic growth and democratic stability undergone by Uruguay and Brazil which gives an additional push to our association”.

    President Rousseff said that in support of these initiatives and ensure their concretion in 2010 “we created the Brazil/Uruguay Bilateral Commission for Strategic Planning and Productive Integration, CBPE” to deal with infrastructure plans and cooperation.

    “Integration of our countries can’t be limited to the acquisition of Uruguayan assets by Brazilian companies but by a productive articulation of our economies in the future, and for that reason focused on innovation and technology development”, underlined Ms Rousseff who praised Uruguay’s political stability, strong legal system and qualified labour force.

    The Brazilian president in her message also mentioned a common strategy in regional and global foreign policies with the purpose of confirming an international multi-polar system.

    For this “we are working in the constant strengthening of unity and presence of Mercosur. This has been done with the elimination of the double charge and prevalence of the Common External Tariff, to facilitate trade among members and sponsoring of the Structural Convergence Fund to alleviate the region’s asymmetries.

    Ms Rousseff also mentioned the two countries commitment with the Union of South American Nations, Unasur and with the pending UN reforms, particularly the Security Council to guarantee an improved representation. Uruguay and Brazil are also main contributors to the UN Haiti Stabilization Mission in Haiti.

    “Brazil and Uruguay have an enviable solid heritage of democracy, economic growth with inclusion which is a formidable tool to overcome the challenges of development and creating in South America the same example of peace, prosperity and cooperation”, concluded the presidential message.

    BB in Uruguay

    State financial institution Banco do Brasil, Latin America’s biggest bank has requested a licence to operate in Uruguay as a commercial bank. Banco do Brasil has been expanding aggressively overseas, including the US.
     
    “The bank’s plans include transforming the financial office in Montevideo into a commercial bank and work together with the Financial Institute for Foreigners, IFE, (off-shore) in the sea resort of Punta del Este” revealed Carlos Nóbrega Vice-president of Banco Patagonia, an Argentine institution which was recently absorbed by the Banco do Brasil.

    The Banco do Brasil plans in Uruguay are in line with what was announced months ago when the powerful institution took over the US, Florida, EuroBank, which is “to attract that bracket of customers represented by Brazilian corporations and individuals operating in Uruguay and the region.”

    In Uruguay an estimated sixty Brazilian first line corporations have affiliates and Punta del Este has become one of the main international destinations for Brazilians and Argentines investors, and tourists in the southern hemisphere summer.

    It is estimated the licence request can take anywhere from three to four months so the commercial operation of Banco do Brasil could become effective sometime in the second half of 2011.

    ABr/MP

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