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With Venezuela in, Mercosur Becomes a US$ 1 Trillion Heavyweight

As of now, Mercosur officially has five members. Venezuela joins the block at a critical moment. The smaller members, Paraguay and Uruguay, have called for more assistance in dealing with the enormous differences between their economies and those of the other larger members, Brazil and Argentina.

With Venezuela in the block, Mercosur will have 250 million inhabitants, an area of 12.7 million square kilometers and a GDP of US$ 1 trillion, the equivalent of 76% of South America’s total GDP.

Speaking at the ceremony celebrating the official entry of Venezuela in Mercosur, Brazilian president Luiz Inácio Lula da Silva did not limit his remarks to a prepared speech.

Improvising, he got rounds of applause with a strong defense of South American integration, as well as when he admitted that there will be bumps on the road to integration, such as the recent gas crisis with Bolivia.

Lula pointed out that united, Brazil and its neighbors were stronger in multilateral organization negotiations, such as the UN and the World Trade Organization.

Referring Venezuela’s membership in Mercosur, Lula said it guaranteed fair trade and allowed the business community to do business. He called it a concrete example of how a dream that millions of Latin Americans have dreamed can become reality.

Lula concluded by saying that "The day when a ceremony in La Paz marking the entrance of Bolivia into Mercosur takes place is not far in the future." At the moment, Bolivia is an associate member of Mercosur.

The Brazilian president also called the event a historic act, a concrete example of South American integration.

"What we have here is much more than an economic or commercial agreement. This is a historical step in the integration of the continent. We have to learn to live with each other’s problems and the asymmetrics in our relations," said Lula.

The ceremony was attended by presidents Hugo Chavez, of Venezuela, Nestor Kirchner, of Argentina, Nicanor Duarte, of Paraguay, and Tabaré Vásquez, of Uruguay.

According to the president of Argentina, Néstor Kirchner, his country has an important strategic alliance with Venezuela and sees its membership in Mercosur "as a qualitative step in projecting the region on the world stage and integrating it… we are responding to the expectations of our people with this event."

Kirchner called the moment "historical" and said it would strengthen the position of Mercosur in its dealing with the rest of the world, "the European Union, Africa and Asia."

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Next: IMF Predicts 3.5% Growth, But Brazil Says It Will Grow 4.5% in 2006
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