The Argentine ambassador to Brazil, Daniel Scioli, assured this Tuesday that the national authorities are “moving rapidly” with their Brazilian counterparts in a “great bilateral agreement”, with understandings that will cover points such as the trade -with an extension of the import compensation system to 180 days- and financing for the construction of the President Néstor Kirchner Gas Pipeline.
“The relationship could not have started better because we are already making progress in the great objective of a deep integration agreement with Brazil that will be very beneficial for both countries in this international context of disruption, upheaval and inflation that requires us to work more together than ever” , Scioli said in dialogue with CNN and Continental radio.
“A great energy, industrial, financial and agri-food integration is coming”Daniel Scioli
Behind the meeting held this Monday by President Alberto Fernández with his new Brazilian counterpart Luiz Inácio Lula da SilvaScioli anticipated that he will meet this Tuesday with the new Minister of Foreign Affairs of Brazil, Mauro Vieira.
“I am the first ambassador to receive in line with what Lula has done with Alberto,” said Scioli, who specified that the meeting will focus on advancing with the details of the bilateral agreement.
He added that, after Lula’s inauguration in Brazil, “great energy, industrial, financial and agri-food integration is coming”, given that “all the conditions are in place to give a great boost” to the relationship between the two States.
After emphasizing that even with the difficulties in the bilateral relationship during the presidency of Jai Bolsonaro, since the Embassy took office, a relationship that was at the “worst moment in history” was reversed, reinstating Brazil as the first trading partner.
Scioli emphasized that “the fact that the two presidents have great personal and political harmony, and that they instruct their ministers to advance in this objective makes everything much easier”, and affirmed that, although in the long term the The objective is to aim towards a single currency, immediately it will seek to “strengthen the payment system in local currencies” with Brazil.
In the immediate future, it will seek to “strengthen the payment system in local currencies” with Brazil.
With its instrumentation, the ambassador indicated that the compensation for imports will go from being daily to a period of 180 days, which, he explained, “will allow the reserves to be decompressed immediately for imports while the next harvest comes and the end of the the gas pipeline”, in addition to making it possible for there to be “no type of restrictions on bilateral trade”.
The measure, which is being outlined between the central banks and the economic portfolios of both countries, will also bring a benefit to Brazil by “increasing bilateral trade with Argentina.”
Construction of the gas pipeline
For his part, Scioli also indicated that Brazil will finance the second stage of the construction of the President Néstor Kirchner Gas Pipeline. through the National Bank for Economic and Social Development (BNDES) of that country.
“The second stage will allow us to export more and more gas to Brazil, which needs it, and at more competitive prices than those it currently buys because Bolivia’s reserves are declining,” he said.
Specifically, the BNDES is working -since the last months of Bolsonaro’s administration- on the technical part to finance the inputs that are acquired from Brazil for the construction of the Gas Pipelineaccording to Scioli, who stated that this agreement “will also decompress the use of reserves.”
The second stage of the gas pipeline will extend 583 kilometers from Salliqueló, in the province of Buenos Aires, to San Jerónimo, in Santa Fe.
The works in the second stage will allow the capacity of the national trunk gas pipeline transportation system to be expanded by 25%, adding value to the Vaca Muerta reserves.
For its part, last December, trade with Brazil returned to a surplus for Argentina with a slight favorable balance of US$ 4 million, thus extending the trend registered in November after 11 consecutive months of deficit, according to figures released yesterday by the Government of the neighboring country and reviewed by the consulting firm Abeceb.
Looking ahead to 2023, Abeceb analyzed that “Lula’s return to the presidency and the bilateral meeting with Alberto Fernández during his first day in office -as well as the confirmation of a second meeting towards the end of this month- have increased expectations of a 2023 in which the bilateral relationship with Brazil could be deepened”.
