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The Bus
05-27-08, 08:31 AM
South America eyes common currency

BRASILIA (Thomson Financial) - South America is thinking of creating a common currency and a central bank along the lines of those in the European Union's euro-zone, Brazilian President Luiz Inacio Lula da Silva said Monday.

The idea is a logical next step following the signing last Friday of a teaty creating a Union of South American States that aims to promote joint regional customs and defense policies, Lula said during his weekly radio broadcast.

'Many things still haven't been realized. We are now going to create a Bank of South America. We are going to move forward so in the future we'll have a single central bank, a common currency,' he said.

But, he added: 'This is a process. It won't be something that happens quickly.' [According to Allan Wagner Tizón, former Secretary General of the Andean Community, a complete union like that of the EU should be possible by 2019. - added from Wikipedia]

Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Guyana, Paraguay, Peru, Suriname, Uruguay and Venezuela all signed up to the UNASUR treaty creating the regional union during a ceremony in Brasilia last Friday.

The entity's goal is to bring together two trade blocs within South America, Mercosur and the Andean Community, and to integrate the region.

Brazil is also pushing for a regional defense council that could be used as a forum to settle inter-regional disputes as well as formulate joint policies.

Lula said the creation of UNASUR was 'the realization of a dream,' and evidence of remarkable economic and political progress South American nations have made in recent decades.

Brazil, Latin America's biggest economy, has taken the lead in the new entity.

But Colombia, the strongest U.S. ally in South America and a country often at odds with neighboring Venezuela and Ecuador, has decided not to join.

Lula stated that 'nobody can think of this as a crisis' in the nascent bloc, noting that several EU nations also opted out from aspects of European integration such as adopting the euro.

http://www.forbes.com/afxnewslimited/feeds/afx/2008/05/26/afx5047714.html

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Not much news about this, although of course this is only preliminary stuff anyway. Interesting to see that unlike the EU, everyone joined (except for French Guyana, natch).

Tuan Jim
05-28-08, 05:00 PM
It's a good idea in theory, but let's face it - at this point, the average S. American country is a lot further apart in many ways than the major European powers are when they first created the European community in the 60s.

It's still a decent idea though for down the road if the folks down there can get their act together - more free trade always = :up:

The Bus
05-28-08, 05:27 PM
It's a good idea in theory, but let's face it - at this point, the average S. American country is a lot further apart in many ways than the major European powers are when they first created the European community in the 60s.

Culturally, economically, politically, or all of the above?

Tuan Jim
05-28-08, 08:19 PM
Culturally, economically, politically, or all of the above?

Culturally not so much; economically depends if they're trying to pull everyone in at once - then they'll have some issues between the guys trying to nationalize everything (Bolivarians) and the free market fans; politically - same thing.

The Bus
05-28-08, 09:10 PM
OK, I was going to disagree with you but I was only thinking of it culturally. As far as political and economic systems, I agree with you.


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