Porto Alegre, Brazil, April 29th 2010 (Venezuelanalysis.com) – Venezuelan President Hugo Chávez met with Brazilian President Luiz Inácio “Lula” da Silva in Brasilia on Wednesday, where they signed 22 agreements in the areas of energy, housing, agriculture, culture, tourism and more. This was the first meeting between the two countries since the Brazilian Senate approved Venezuela’s entry into the Mercosur trade bloc on December 15, 2009.
At the summit, Chávez recalled that before Lula “relations between Venezuela and Brazil were next to nothing.”
“We have evolved in eight years, more than we had evolved in 200 years. We evolved because we understand that although we speak different languages, in reality our people know that we are all South American,” said Lula, speaking on the importance of Venezuela-Brazilian relations. This was the 9th Bi-national Meeting between the two countries since 2007.
One of the major issues on the table was a Brazilian ship-building factory in Venezuela. Brazil’s National Economic and Social Development Bank (BNDES) plans to finance the $1 billion project. According to the Brazilian government’s advisor in International Affairs, Marco Aurélio Garcia, the factory will attend to the demand that will come from the oil production from the Pre-Sal shelf off of the Brazilian coast.
“The shipping demand to attend to the innumerable necessities of this work, will be so large that today, world production doesn’t have the capacity,” said Garcia.
In other accords, Venezuela’s Housing and Public Works Ministry signed an agreement with the Brazilian company, Norberto Odebrecht, for the construction of public housing in Venezuela’s poor barrios. The Housing Ministry and Consilux Tecnologia also signed a letter of intent to “reactivate and execute” projects in the Poles of Endogenous Development in Ciudad Bolívar and Barquisimeto.
In the area of finance, following a recent visit to Caracas, Brazil’s Caixa Econômica Federal agreed to support the Bank of Venezuela with technical assistance in order to increase banking access to Venezuela’s most needy populations. Venezuela nationalized the Bank of Venezuela in August 2008, as part of its efforts to restructure and improve social responsibility in the national banking and financial sectors.
The two countries took steps towards cross-border cooperation in areas of education, health and social services. These agreements could lead the way to a special bi-national migratory status for the residents along the Brazilian-Venezuelan border.
Chávez and Lula signed into effect the “Bi-national Assistance Centers for Women Migrants on the Brazilian-Venezuelan Border.” These centers will support women migrants in situations of violence.
The presidents commended work between the two countries that has connected the Venezuelan border town of Santa Elena to Brazil’s Boa Vista via fiber-optics. They plan to extend the network to Manaus by the end of the year.
In agricultural cooperation, the presidents added a two-year extension to the agreement between the Venezuelan Ministry of Agriculture and the Brazilian Agricultural Research Corporation (EMBRAPA) for the production of grain, seeds, cattle, chicken and local agriculture. They also agreed to evaluate the possibility of purchasing and distributing products in Venezuela directly from small Brazilian producers. A technical team from Brazil’s National Supply Company (CONAB) will also visit Venezuela in May and June to support Venezuela’s “Strategic Socialist Family Agricultural Plan.”
In social agreements, the presidents launched the Brazilian-Venezuelan Social Cabinet, to develop joint programs to eradicate the causes of poverty and social inequality. They stressed the importance of globalizing Brazilian and Venezuelan social programs focused on meeting the basic needs of the population.
The presidents also signed a letter of intent to develop Brazilian youth symphonies, based on the work of Maestro José Antonio Abreu, and Venezuela’s widely successful youth orchestras.
The Venezuelan state-oil company, PDVSA, agreed to increase its supply of gasoline to the Brazilian petrochemical company, Braskem; up to 750,000 barrels a month.
Polipropileno del Sur, PDVSA, Petroquímica de Venezuela (Pequiven) and Braskem agreed to form a joint venture to construct a polypropylene plant in Venezuela’s Paraguaná Refinery Complex. The plant will have the capacity to produce 300 metric tons a year.
Both nations are looking to diversify electricity production to keep up with the dramatically rising demand. Venezuelan has been rationing electricity amidst a crippling energy crises. Brazil was rocked by a nation-wide power outage last November. In response, Venezuela has planned the construction of several thermoelectric plants, and Brazil is taking steps towards the construction of the controversial Amazon-based Belo Monte hydroelectric dam. On Wednesday, Chávez and Lula signed a memorandum on cooperation in electric energy, which the presidents hope will stimulate an exchange of knowledge in biodiesel, ethanol and thermoelectric plants.
This was Chávez’ first visit since the Brazilian Senate approved Venezuela’s entry into the South American trade-bloc Mercosur. Venezuela joined Mercosur on July 4th, 2006, but its official entry has been stalled, awaiting the approval from each member country’s congress. Argentina, Brazil and Uruguay have now given the green light, but Venezuela is still waiting for Paraguayan approval.
“Hopefully that in honor of Lula, before he leaves the presidency, Paraguay will approve Venezuela's membership of the Mercosur,” said Chávez. “It is absolutely necessary for South American integration, for social and economic growth, the unity of our people, of our great South American territory.
Chávez took advantage of the occasion to describe how, without Lula, North American interests would’ve undercut Mercosur.
“If you hadn’t become president, Lula, today Mercosur would have been pulverized. You said it yourself. The proposal of FTAA [Free Trade Area of the Americas] was a proposal to pulverize Mercosur and the rest of the means of integration that we have in Our America,” said Chávez.
This was one of the last meetings between the two presidents before Lula steps down at the end of the year. Brazilian presidential elections are scheduled for October 3rd. Chávez told the press that “independent” of who wins this year’s elections, relations between the two countries would not be affected.
Nevertheless, on his way to Brazil’s Itamaraty Palace the Venezuelan president gave a plug for Lula’s potential successor, Worker’s Party candidate, Dilma Rousseff.
“I don’t want to interfere in Brazilian internal affairs, just as Brazil shouldn’t interfere in Venezuela’s internal affairs, but my heart is here: Dilma Rousseff,” said Chávez, according to Brazil’s UOL News.
In the run-up to the elections, the mainstream Brazilian press has recently increased its criticism of Lula for his friendly relations with Venezuela, Cuba and the ousted Honduran government of Manuel Zelaya.
Commercial relations between Venezuela and Brazil grew to $4.2 billion in 2009, of which $3.6 billion came from Brazilian exports. Lula explained that the commercial relations will balance with the construction of the Abreu e Lima oil refinery in Pernambuco, Brazil, which will enable Brazil to purchase Venezuelan heavy crude.
“We are surely going to balance our commercial relations. This is important because growth in the Venezuelan economy is important to strengthen our strategic relations,” said Lula.
This Wednesday’s meeting makes nearly 20 bi-national summits between Chávez and Lula, and the ninth since 2007 when the presidents began meeting three times a year. Chávez and Lula plan to meet next in August and then again in December, shortly before Lula steps down as Brazilian president.
Chávez was back in Barinas, Venezuela on Thursday to meet with Bolivian President Evo Morales. The Venezuelan president and his South American counterparts head to Argentina early next week for the May 4th summit of the Union of South American, Unasur. During the international meeting, former Argentine President Nestor Kirchner is expected to be voted in as the first Secretary General of the organization.