BRAZIL: Economic ministers of Mercosur countries meet in Rio de Janeiro to talk about creating a new regional bank

Finance ministers of the five member countries belonging to the Mercosur bloc met on Friday (September 1, 2006) in Rio de Janeiro, Brazil to discuss matters regarding interregional trade and currency issues. The five member countries belonging to the trading bloc are Brazil, Argentina, Paraguay, Uruguay, Venezuela, Bolivia, and Peru. Mercosur intends to motivate small and medium sized businesses that are discouraged from greater market participation due to barriers caused by having to conduct business in dollars. A plan of action is expected to be presented by mid-December, when representatives of member countries meet to discuss the plan which would become effective as of 2007. Brazil's Finance Minister Guido Mantega said Brazilian and Argentina's Central Banks are studying the possible trade and finance options that will make it possible to directly trade with each other, and eventually other member countries, in their own currencies. "Studies are being made, especially through the central banks of Argentina and Brazil, in the sense of making available instruments so that trade among these countries, initially, and later the remaining nations of the Mercosur, are made in local currencies," said Mantega. Argentina's Economic Minister Felisa Miceli said it is necessary to find ways for dealing with macroeconomic instabilities that may exist between countries in order to establish a more ambitious plan in the future. "We will advance with a strategic agenda in order to think about a resolution for macroeconomic instabilities, and like that, also establishing more ambitious goals for the future," she explained. At this moment, Brazil and Argentina trade corresponds to some 80% of the total flow in the bloc.

ITN Source | September 2, 2006

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