Lula announces plan to resume strategic alliance with Argentina

President Luiz Inácio Lula da Silva met, this Monday (26), with the president of Argentina, Alberto Fernández. After the meeting, Lula said that the two countries are going to draw up a plan with “almost 100 actions” to resume a “strategic alliance”.

With the plan, the Brazilian government seeks to help the Argentine economy, the third largest trading partner and responsible for the surplus of US$ 2.2 billion in the trade balance last year. In 2022, there were US$ 15.3 billion in exports to the neighboring country and US$ 13.1 billion in imports of Argentine goods.

In his speech, Lula emphasized the import of economic integration between the countries. “Our economic integration means interdependence. Argentina is the third largest destination for our exports, while Brazil is the main market for Argentine products. Our commercial exchange may exceed the figure of 40 billion dollars that we reached in 2011. We build a relationship based on the exchange of high value-added goods and on the productive integration of our economies. Our reciprocal investments are responsible for almost one hundred thousand jobs”, said Lula.

Argentina has been experiencing a severe economic crisis in recent years. The devaluation of the peso pulverizes the purchasing power of Argentines, with inflation reaching more than 100% a year. The poverty rate jumped 15 percentage points in ten years, leading 19.7 million Argentines to this social condition. The gross external debt closed 2022 at US$ 276.7 billion.

The fear of the Brazilian government is that the collapse of the neighbor could contaminate the local economy, given the importance of bilateral trade. The automotive industry, one of the sectors that most generate jobs, and wheat are two of the main businesses between Brazil and Argentina.

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“We are working on creating a comprehensive financing line for Brazilian exports to Argentina. It makes no sense that Brazil loses space in the Argentine market to other countries because they offer credit and we don’t. Everyone has to gain: companies, Brazilian workers and Argentine consumers”, said Lula.

According to Itamaraty, the invitation was made in the context of celebrating 200 years of diplomatic relations between the countries, since Argentina was the first country to recognize Brazil’s independence and, thus, the first to establish diplomatic relations.

For the celebration, the heads of powers, the President of the Superior Federal Court (STF), Minister Rosa Weber, and the President of Congress, Senator Rodrigo Pacheco (PSD-MG) gathered on the agenda.

Speech in Europe

At the Summit on the New Global Financing Pact, held in France last week, the Brazilian president criticized the International Monetary Fund (IMF) in the context of world governance.

“Let’s be clear that the World Bank leaves much to be desired in terms of what the world aspires to from the World Bank. Let’s be clear that the IMF leaves a lot to be desired in what people expect from the IMF,” she said.

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Lula cited loans made by Argentina, and said that the IMF acted in an “irresponsible” way, and that these institutions “cannot continue” acting in a “wrong way”.

“And often banks lend money and that borrowed money is the result of state bankruptcy. This is what we are seeing in Argentina today, Argentina, in the most irresponsible way in the world, the IMF lent 40 billion dollars, 44 billion dollars, to a gentleman who was president. It is not known what he did with the money. and Argentina today is going through a very difficult economic situation, because it doesn’t even have the dollar to pay the IMF.”