FINANCE | 23.12.2008
EU, Brazil to Speak With One Voice on Financial Crisis
The European Union and Brazil intend to speak "with one voice" on the international financial crisis, the presidents of France and Brazil said at a two-day EU-Brazil summit held in Rio de Janeiro on Monday and Tuesday.
President Nicolas Sarkozy of France, the current holder of the EU presidency, said he and Brazilian President Luiz Inacio Lula da Silva held similar views on the financial crisis and that they would both air those views at the next Group of 20 major economies meeting on April 2 in London.
The April meeting will continue efforts in search of a new global financial order, Sarkozy said. The previous G20 gathering in Washington in November saw developed and developing countries agree to attempt to revive the struggling world economy.
"Europe and Brazil must speak with one voice to change how the world reacts to such crises," Sarkozy said. This was true not only of the financial crisis, but also of the need to bring the Doha round of world trade talks to a successful conclusion, of the need for alternative energy sources and of the need to halt climate change, Sarkozy added.
"We decided to narrow our positions and arrive in London with a common vision, on the future role of the IMF, the system of management of financial institutions," he said. "We cannot allow a single financial institution to be uncontrolled or unsupervised."
Common answers necessary: Lula
Brazil's leader says the crisis can bring developed and developing nations together
Lula emphasized the "overlapping interests" of his country and those of the EU, which would facilitate cooperation in these "unsure and turbulent times."
"The crisis offers the possibility for developing as well as developed countries to find common answers to the most difficult challenges of current times," Lula said.
The two leaders, who also met with EU Commission President Jose Manuel Barroso in Rio de Janeiro, envisioned a path that would lead to a free trade pact between the EU and Mercosur -- the regional free trade grouping of Argentina, Brazil, Paraguay, Uruguay and a collection of other associate South American member states -- Lula said.
Lula also called for far-reaching reform of the finance sector to fix the "shameless speculation" that resulted in the current crisis.
Brazil key to global answers: Sarkozy
Sarkozy and Barroso emphasized the growing stature of Brazil as a developing industrial country and regional power. The country represents Latin America's biggest economy and has been pushing for a permanent seat at the UN Security Council.
Brazil's growing economic power has positioned it as a world player
"Who wants to try to solve the problems of the world without countries like China, India and Brazil?" Sarkozy posited in an interview. "I'm being honest when I say we need Brazil in world governance. I think we need Brazil as a permanent member of the Security Council."
The summit was to be followed by a bilateral meeting between France and Brazil, in which the two were to discuss a joint-building of a nuclear-powered submarine for the Brazilian Navy.
Trade between Brazil and the EU stood at around $77 billion (55 billion euros) in the first 11 months of this year, an increase of 26 percent from the same period last year. That would make the EU Brazil's most important trade partner, followed by the US.
EU countries also head the list of investors, with $18.4 billion in 2007, the equivalent of 54.6 percent of all foreign investments in Brazil.
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