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Brazil says Mexico may join Mercosur

Houston Chronicle

Brazil says Mexico may join Mercosur

Trade group wants to expand bargaining power

Reuters News Service

7 August 2006

SÃO PAULO, BRAZIL - Brazil Trade and Industry Minister Luiz Fernando Furlan said Monday that Mexico could join the South American trade block Mercosur within a year.

Furlan said Brazilian President Luiz Inacio Lula da Silva recently met with Mexican President Vicente Fox.

"There is the prospect that Mexico could become a member in the next 12 months," Furlan told business leaders in São Paulo.

Furlan, a former businessman with close ties to São Paulo industry, did not detail on what terms Mexico might join the five-nation trade group.

The announcement follows criticism by some Brazilian industry leaders that Venezuela’s entry into Mercosur last month could "excessively politicize" the group and increase disagreement among members. That is because Venezuelan President Hugo Chavez is outspokenly anti-American, while Uruguay and Paraguay want to negotiate a trade deal with Washington.

Brazil has sought to expand Mercosur, which also includes Argentina, to gain bargaining power when talking trade with the United States and Europe.

Fox said last November that Mexico wanted to be an active and integral member of Mercosur. Felipe Calderon, from Fox’s political party, is likely to soon be confirmed the winner of last month’s presidential election.

Brazil initially resisted Mexico’s request to enter Mercosur, saying it preferred to have the group made up of all South American nations. Mexico now participates as an observer in Mercosur. Bolivia, Chile, Colombia, Ecuador and Peru are associate members.

Also Monday, Mexico’s bolsa fell 47.45, or 0.2 percent, to 20,307.54. The peso rose to 9.1937 cents from 9.1693. The dollar fell to 10.877 pesos from 10.906.