The Brazilian Foreign Minister, Antonio Patriota, continues to defend Venezuela’s entry in Mercosur and the suspension of Paraguay from the bloc.

Last Wednesday (11), Patriota appeared in the Senate’s Committee for Foreign Relations and responded to criticism from parliamentarians who are contrary to the suspension of Paraguay and against the support given to Venezuela by Brazil, Uruguay and Argentina.

The minister reiterated that both decisions were adopted by common agreement between the three countries during the recent summit meeting, held in the Argentine city of Mendoza. “Paraguay will only be able to rejoin the bloc when it restores full democratic order.”

About Venezuela’s admission as a full member, which was strongly opposed by the Paraguayan Congress before the country was suspended, Patriota insisted that the country has a “strategic” economic and political importance to Mercosur.

“With Venezuela’s admission as a full member, Mercosur will extend itself from Patagonia to the Caribbean” said the minister, who highlighted Venezuela’s potential in the energy sector and its potential of “strengthening the networks of trade and investment” in the region.

According to Patriota, both the suspension of Paraguay and Venezuela’s entry were “difficult, but matured decisions, carefully adopted as to not affect the Paraguayan people” and “as a response to an unacceptable situation.”

The admission of Venezuela as a full member of Mercosur will be formalized at a special meeting to be held on June 31^st, in Rio de Janeiro.

The government of Paraguay filed a requirement last week in the Permanent Court of Mercosur to restore its rights in the bloc, which were temporarily suspended, and also presented a complaint opposing the inclusion of Venezuela as a full member.

The government’s top legal officials presented the requirement to the Permanent Court, whose headquarter is located in Asuncion, as announced last week by the Minister of Foreign Affairs, José Félix Fernández Estigarribia.

The complaint included a protest ​​”against the suspension of Paraguay from the bloc and the declaration by which Venezuela was incorporated as a full member, both decisions contrary to the Treaty of Asuncion, the Protocol of Ouro Preto and the general rules of international law,” according to lawyer, Ernesto Velázquez.

Velazquez, who is part of the government’s legal team, ensured that Paraguay believes that “the aforementioned provisions are null and void” and that “they cannot have legal application and effectiveness.” Moreover, the lawyer points out that the government of Federico Franco, the rightful president since the former head of state, Fernando Lugo was removed by the Senate on June 22, demands the return of Paraguay’s rights within the block.

Velazquez insisted that Mercosur has violated its own resolutions like the “principle of legal equality between states” and “the principle of nonintervention.” He detailed the process, in a document of about 60 pages. All the judges of the Permanent Court, as well as the governments of member states have a deadline of 60 to 90 days to decide on the matter.

The president of Uruguay, Jose Mujica, ratified the decision of his country to support the inclusion of Venezuela in Mercosur after the bloc approved the suspension of Paraguay from the group.

According to press reports, Mujica said that “while it is true that the proposal was elaborated in the first place by Brazil, we three agree (the presidents of Argentina, Brazil and Uruguay), about Venezuela’s entry in the bloc”. The representative of Uruguay said “the political will involved in the case, far exceeds the possible legal impediments regarding the matter”.

Paraguay was suspended from the bloc after Fernando Lugo was deposed. The suspension led to the approval of Venezuela’s entry in the free-trade agreement. Before the events involving Lugo, Venezuela’s entry in Mercosur faced strong opposition by the Paraguayan Senate, while the lawmakers of Argentina, Brazil and Uruguay have long supported Venezuelan admission to the group.

Mercosur was formed in 1991 after signing of the so-called Treaty of Asuncion between Argentina, Brazil, Paraguay and Uruguay.

The special advisor for international affairs of the Presidency, Marco Aurelio Garcia, denied that Brazil has pressed Mercosur countries to force Venezuela’s entry as a permanent member on the bloc.

In an interview for radio “El Espectador”, however, the Uruguayan foreign minister, Luis Almagro, said that “nothing is decided” and that “the country has not given the last word” on the whole process. According to Almagro, the intervention of President Rousseff was “decisive” for Venezuela’s entry.

Almagro’s statements surprised the Brazilian Presidential Palace and made Marco Aurelio personally call the Uruguayan President, Jose Mujica, to verify the story.

Marco Aurelio Garcia explained “the decision to include Venezuela on July 31^st was part of a broad understanding that included President Mujica. “I want to make clear that on our part there was no imposition, no pressure. This is not the style of President Dilma or that of the Brazilian foreign policy”.

Garcia said that Venezuela withdrew from economic sanctions it had unilaterally taken against Paraguay to suspend oil supply to its Latin American neighbor. He denied, however, that the Chavez’s retreat was a condition to the entry of Venezuela in the bloc.

Venezuelan President Hugo Chavez assured that he will protocol his candidacy to to run for reelection within the required deadline set by the country’s electoral authority, reducing doubts about his ability to meet the challenges of the election campaign while fighting cancer at the same time.

After 11 days without appearing in public since returning from medical treatment in Cuba, Chavez coordinated a government meeting in the Miraflores Palace, broadcasted on national television.

The Venezuelan president, who appeared on television only twice since mid-April, said his candidacy will be made official between June 1^st to 11^th, the deadline set by the National Electoral Council (CNE).

Chavez turned his criticism to the opposition candidate, Henrique Capriles, accusing him of trying to emulate the socialist model to climb in the polls.

While Capriles held a series of house-to-home visits in recent months, the command of Chavez’s campaign has made frequent political acts, regardless of the absence of Venezuelan President on the account of his radiotherapy treatment in Cuba.

Meanwhile, polls show Chavez is ahead of Capriles. The candidate of the Mesa da Unidade Democrática (MUD), said he will formalize his candidacy on June 1^st

Brasil’s embassador in Caracas, Antonio José Ferreira Simões, was mobilizing in favor to the addition of Venezuela to Mercosur. According to the Senate agency, he visited several senators last week to show the importance (especially economical importance to Brasil) of the entrance of a new partner in the economic block, in which Argentina, Paraguay and Uruguay are already part of.

Simões stayed in contact with the following parliamentarians: the senate’s president, José Sarney; CRE’S (Commision of Foreign Affairs and National Defense) president, senator Eduardo Azeredo (PSDB-MG); and the rest of the senators that are part of the commission.

The diplomat informed all the parliamentarians about the numbers of bilateral commerce: i) in the last 10 years, the exchanges between the two countries increased 850%, reaching a total annual of US$ 6 billion; ii) From that total, around US$ 5.3 billions are from Brazilian exports and only US$ .7 billions are from imports, forming the highest surplus of the Brazilian trade balance.

“Mercosur needs a new impulse and this impulse could be the entrance of Venezuela”, emphasized the embassador. In his opinion, Venezuela already became the first world-wide market of Brazil for powder milk and the second market for Brazilian meat.

In the interview granted to the Spanish newspaper “El Mundo”, the mayor of Maracaibo, Manuel Rosales, left open the possibility of competing in the presidential elections of 2012, year in whichVenezuela’s president, Hugo Chávez, will try a new mandate. According to Efe agency “if the conditions were favorable it would be an honor to displace Chavez from his presidency”.

Questioning about the opposition’s options to defy Chavez’s hegemonic pretensions, Rosales said “there are many capable names”.

In his evaluation, Venezuela’s Chief of State has left victorious for the great volume of resources that came from petroleum exportations that finance social programs for families with extreme limitations from an economical and social point of view, manipulating them to vote for their project.

The biggest mystery is getting to know what the relationship will be like between Barack Obama and the president of Venezuela, Hugo Chávez, who stated his preference for the Democrat during Obama’s campaign.  Different to Republicans, who have a confrontational stance in relation to the Venezuelan Head of State, Obama talks of sending a message of democratic values to Caracas, not through interventionism, but through means of cooperation.

Democrats believe that the mistakes made by the George W. Bush in the region gave ground to anti-democratic views expressed by Hugo Chávez in Venezuela. 

The president of Conindustria, the Venezuelan Industry Confederation, Eduardo Gómez Sigala, has said that the 15% inflation target set out by the government for 2009 is not compatible with the nation’s reality. In an interview with a local newspaper, he said that inflation will reach 35% by the end of the year. Therefore, it would be very difficult for the projected reduction to occur next year.

Sigala revealed that, based on the institution’s projections, Venezuela will keep relying on imports. He also questioned Finance Minister Ali Rodríguez Araque, who has projected a 6% economic growth for 2009.

He said that the manufacturing industry accumulates only a 3% expansion, whereas in 2007 it reached 7.5%. He also revealed that business people are convinced that the economic situation will get even more complicated and difficult by next year. According to him, growth will not be achieved unless domestic production is increased in all industries.

Respect to private ownership is also seen as fundamental by business people for the nation to recover. “While there is talk of investments, the government is questioning ownership rights”, said Sigala.

As the political success of the so-called “21^st century socialism” is associated to the expansion of oil exports in the latest years, international oil price drops may bring trouble to Venezuelan President Hugo Chávez. According to Financial Times, a question for those following Venezuelan politics is with which intensity oil price drops may jeopardize the nationalization-based economic model implemented in the nation.

Petroleum, which accounts for 95% of the country’s export income, finances half the State expenses. Thus, Chávez relies on such funds to keep his social programmes running and make up for the lack of private investment. Consequently, the Venezuelan Chief of State’s popularity depends on these programmes. According to think tank Ivad, Chávez approval rates have improved after an increase in expenses last month.

Financial Times quotes a presidential source as saying that basic social expenses (food, health, education) will not be reduced. If necessary, medium and long-term projects (less politically sensitive) will be diminished.