Brazil's President Lula favours South American Central Bank

Brazilian President Lula da Silva favours the creation of a Banco Central de América del Sur, a central bank for South America working very much in the same way as the European Union's. He made the revelation yesterday on his program Café con el Presidente, on which he highlighted that a first step in this direction would be to give life to the Bank of the South or Banco del Sur, an ongoing project.

In Lula's view, a South American Central Bank would be this region's equivalent of the Central Bank of Europe, created on June 1, 1998. The bank preceded the launch of the Euro currency and was necessary to regulate the common note.

According to the Brazilian President, the signing by the 12 South American heads of state of the constitutive treaty known as Unasur opens the path for the creation of institutions of this kind. "In the future, we shall have a single currency," Lula added, while admitting later that it would not, however, be a quick process.

The plan to set up a South American Central Bank and a single currency will not be easy to implement. Not even the South American trading bloc Mercosur has been able to converge its macroeconomic policies, although this was the intention from its inception.

Many former Argentine and Brazilian presidents spoke of a single currency, thinking it were a relatively easy goal. In fact, the former Argentine President Carlos Menem llegó ordered his country's treasury to stamp a coin of the future regional currency. It was more symbolic than anything else.However, Lula aspires to step out of the immediate present and think long term. For him, the Unasur summit last Friday was an "extraordinary act" and criticised the press for its coverage of the event. "The media, especially the print media, portrayed it as if it were a failure," he complained. "Anyone who has been in government or politics in South America knows that what we were able to achieve last Friday was enormous.



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PHOTO: Lugo con Lula en Brasilia by Fernando Lugo APC