Venezuela officially joins Mercosur trade block

BRASILIA—Venezuela was officially welcomed into the Mercosur trade bloc yesterday, giving that nation’s leader Hugo Chavez a long-awaited political prize and strengthening links among the region’s agricultural and energy powerhouses. The inclusion of Venezuela also deepens a political rift within the South American trade group. Paraguay, which long blocked Venezuela’s entry, remains temporarily suspended from the bloc in response to the congressional ouster of that nation’s president.

“Venezuela’s entry increases the potential of the bloc, giving it greater geopolitical and global economic dimensions,” said Brazilian President Dilma Rousseff, noting that Venezuela’s has one of the globe’s largest proven oil reserves, adding energy might to the trade union. “Mercosur is beginning a phase, now we’ve expanded from Patagonia to the Caribbean.”

Chavez said Mercosur “is without a doubt the biggest engine that exists to preserve our independence and accelerate our overall development.” Rousseff hosted Argentina’s President Cristina Fernandez and Uruguay’s Jose Mujica along with Chavez for the one-day Mercosur meeting in Brasilia.

Venezuela had been an associate member of Mercosur, like Bolivia, Chile, Colombia and Peru. Chavez had been trying to get full status for years, but was blocked because Paraguay’s legislature wouldn’t vote to allow Venezuela in. The full members of Mercosur have veto rights over decisions the bloc makes. Paraguay’s former leader Fernando Lugo was impeached by the country’s Congress in June in a fast-track trial triggered by a land eviction that killed 17 people in clashes between police and landless peasants.

At a Mercosur summit in Argentina last month, Fernandez told other heads of state that the “democratic order was broken” in Paraguay because it carried out a two-hour trial where Lugo was not allowed a proper defense. The full members then decided to suspend Paraguay from Mercosur until it holds presidential elections next year.

Mercosur has barred Lugo’s replacement, former Vice President Federico Franco, from attending meetings of the trade bloc. Franco has said the transition of power in Paraguay was carried out according to the law. With Paraguay suspended, Kirchner and Rousseff quickly moved to push Venezuela’s entry into the Mercosur.

Kirchner lauded the addition of Venezuela and its oil riches to the trade bloc. “The addition of Venezuela completes the equation of what will be the 21st century — energy, minerals, food, science and technology,” said the Argentine leader. While in Brazil, Chavez and Rousseff formalised an airplane deal that was previously announced but not detailed.

Venezuela’s state-run Conviasa airlines will purchase up to 20 Brazilian-made Embraer planes in a deal that could be worth US$900 million. The contract calls for Conviasa to purchase outright six E-190 planes for US$270 million. The deal includes options to buy 14 more of the same model later.

AP