Venezuela adhesion to Mercosur - Brazil is expanding its backyard (Opinion)

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Chavez Blessing Lula

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Mercosur (South Market) is a Regional Trade Agreement (RTA) among Argentina,Paraguay, and Uruguay,founded in 1991 by the Treaty of Asuncion. Its purpose is to promote free trade and the fluid movement of goods, people, and currency between the Country members.

Venezuela has applied for membership, but its entry hasn't been ratified by Paraguay and Brazil, although it was ratified by Argentina and Uruguay. In May 2007, the Brazilian Senate asked Venezuela to reconsider the non-renewal of RCTV’s license, an oppositionist television network forced closed by Chávez. President Hugo Chávez , forgetting that Brazil have independent powers, responded accusing the Brazilian Congress of being subservient to interests of the United States.The leader of PSDB (Social Democrats) in the Senate, senator Arthur Virgilio, stated that the party will try to prevent Venezuela's entry in Mercosur and that has being kept out of any Congress priority since them. Brazilian President, Lula da Silva is trying hard to revert that situation, but have not succeeded so far on making Venezuela approved by the Brazilian National Congress.

 The idealistic story about Mercosur is that pretend to be a force of opposition to the idea of creation of the FTAA (Free Trade Area of the Americas). Mercosur countries oppose the FTAA idea because of the United States don’t want to include agricultural items under the agreement and also refuses to discuss subsides that are given to American farmers.

In a recent visit of Pres. Lula da Silva to Venezuela Chavez has expressed that He feels like Venezuela is already as a member of Mercosur. The real story about Mercosur although is a little be different. The reality shows that Brazil have expanded it’s economic power over the member Coutries.

Today in Argentina Brazilian companies are controlling several important sectors of the economy, including gas, oil, retail, finances, automakers, airplanes, beverages and much more. In 2007 the Brazilian had a favorable balance U$ 3.5 Billion trading with Argentina.

Nowadays Brazil, without a free market, exports to Venezuela U$ 4.7 Billion, and import only U$ 345.0 Million back because Venezuela don’t produce anything that Brazil will really need, except gas and oil, but Brazil has found immense oil reserves in his seashore lately, the entry of Venezuela will be ending as an expansion of the Brazilian private market, as happened with Argentina, Paraguay and Uruguay.

Mercosur will incorporate the Venezuelan market definitely under the Brazilian economic dependence sphere, or maybe not, if the Brazilian National Congress still “helping” the Venezuelans.

BBC Brazil has reported about this matter in Portuguese language, but my article is only based on that publication and expresses my own opinion about the theme.