Venezuela and Brazil Strengthen Relations

While Venezuelan and Brazilian businesses signed trade agreements, Presidents Lula and Chavez discussed regional integration and the creation of a South American TV channel and of a South American oil company.

Caracas, September 16, 2004—Venezuelan and Brazilian businessmen signed bilateral agreements of cooperation and agreements for the exchange of technology in the presence of Venezuelan President Hugo Chavez and Brazilian President Luiz Inacio Lula da Silva at the 5th Brazil-Venezuela Business Conference between September 14 and 15 in the Brazilian Amazonian city of Manaus.

The two presidents discussed agriculture, transportation, energy, communications, and tariff policies.  Both Chavez and Lula emphasized the need to confront the mutual problem of excessive bureaucracy to make advances towards the goal of Latin American economic and social integration.

Chavez said that the real enemy for the Venezuelan government and its people is not the Pentagon or internal adversaries but Venezuela’s bureaucracy.  “There are government officials who dedicate themselves to locking doors or tying up agreements,” Chavez said, discussing the historical and cultural bureaucracy of his country and the need to deal with it directly.

The Brazilian President proposed a “revolution” to South American presidents, so that they make a joint decision to fight bureaucracy.  “We believe in the political, economic, and social integration of the continent. In as much, there will be no integration without the dismantling of legal bureaucracy,” Lula said.

In the last 18 months, this was the 5th time that Brazilian and Venezuelan businessmen met to discuss trade agreements between both countries.  “We should create strategic organizations between companies.  I am sure that these initiatives will contribute in an important way to generate employment and wealth for our people,” Lula said, adding that this is the right time for both countries to strengthen their trade relations. 

The Venezuelan president said that as well as tightening trade relations, the two South American countries should also head towards the social integration of the region and realize “Bolivar’s dream” (of a united South America).  “We have to go beyond the political and towards social integration, towards full integration,” Chavez said.

Cooperation agreements include the construction of 100,000 homes for the poor that will become a project of the Ministry of Housing, which was recently created by the Venezuelan government to deal with the national housing deficit, which stands at 1.8 million homes.  Alusa, an energy company, intends to sign a $200 million contract to construct 100 thousand homes for the poor.  This project will count on financing from the National Bank of Economic and Social Development (BANDES).

Amazon for sale

Lula’s speech suggested that the unconditional opening of the country to foreign capital will also be applied in the Amazon.  “We want to stimulate the social and economic integration of the Amazon and to promote the opening of the market for international products, increasing the viability and the amount of exports,” Lula said.

A Brazilian law for “sustainable” exploration of the Amazon is under consideration in Congress.  According to some environmentalists, the law is about certifying the privatization of the region through the exploration of the rainforest by foreign non-governmental environmental organizations which will also open the door to multinationals. 

Energy and TV

Energy integration and South American television were discussed, but without new resolutions.  Telesur, a South American TV channel proposed and led by the government of Venezuela, which would be shared with Argentina and Brazil, was defined by Chavez as “the Latin American CNN,” which would be a new model of television.  Chavez said Latin America should free itself of what he called “the tremendous power of private media companies.”

When it comes to regional oil, political will is not the only issue.  Petrosur or Petroamerica, can become the most important oil company in the world.  The proposal for this South American company goes over very well among workers who live with the threat of privatization.  For them, the obstacles lie in not being included in the control of the resources.

The president of the world’s fifth largest exporter of oil explained that the oil market is saturated, a fact that affects oil prices.  “Oil is at $40 a barrel because the United States invaded Iraq.  The real price, for me, is $30 a barrel,” Chavez said.  And despite his disagreement with OPEC’s policies, Chavez assured he would not make decisions against the oil cartel’s interests.  According to Chavez, if U.S. troops are not removed from Iraq, the price of oil could reach $100 per barrel.


Lula congratulated President Chavez for his referendum victory on the 15th of August and said that it confirms Chavez’s presidency of the country.  “Through the referendum there can be no doubt that Venezuela consolidated a democratic process.  Many times I found Chavez worried about political problems caused by people that did not want to accept the democratic process,” Lula said.

For Lula, there were no winners or losers in the process.  “We have to recognize the level of consciousness of the population that decided to support a president that has dedicated his life to help the poor,” Lula said.

(with information from Agjncia Brasil and Venpres)

Translated by Robin Nieto