Brazil and Argentina seek to start working on the issuance of a common currency. Sergio Massa, Argentina’s Minister of Economy, also stated that the two countries will invite other nations in the area to join this economic integration project in the future.
Brazil and Argentina will lead the common currency issuance project
Ministries from Brazil and Argentina will be discussing the first steps to issue a common bilateral currency. According to statements Given by the Minister of Economy of Argentina, Sergio Massa, representatives of both countries will discuss this issue at the CELAC summit in Buenos Aires on January 24.
Massa told the Financial Times that the discussion would revolve around the initial considerations for the issuance of the coin that would be called “sur”, Spanish for south. Massa stated:
There will be…a decision to start looking at the parameters needed for a common currency, which includes everything from fiscal issues to the size of the economy and the role of central banks.
Massa warned that this type of project will take time to materialize, and mentioned as an example the euro, which had been in the making for 35 years before finally being adopted in the European Union. He explained:
I do not want to create false expectations… it is the first step on a long road that Latam must travel.
An invitation to Latam
While the currency would first be studied and designed to be a bilateral effort, the project could be extended to include more nations in Latam in the long term. “They are Argentina and Brazil inviting the rest of the region,” Massa explained.
The project for a common currency for Latam has been gaining momentum over the past year. Brazil’s President Luis Inácio Lula Da Silva had referred to this development before as part of his presidential campaign. At a party rally in May, Lula Da Silva declared his intention to participate in the creation of this common currency project, adding that the objective would be to decrease the dependence of Latin American countries on the US dollar.
In November, Nicolás Maduro, the president of Venezuela, endorsed the idea, saying it would be “extraordinary.” He also called for the inclusion of cryptocurrencies as part of the 21st century monetary system.
What do you think about the issuance of a common currency in Latam? Tell us in the comment section below.
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