2009-05-17

Caijing Interview with Brazilian President Silva

From Caijing's interview with the President of Brazil:
Caijing: What strategic issues will you focus on?

Silva: We will focus on renewable fuels, especially ethanol and bio-diesel. Brazil has the technology; it's already been tested and used for many years. Brazil's energy blend is very diverse and we'd like to share that knowledge with the Chinese. Brazil is the only country in the world where nearly 90 percent of all cars sold are flex-fuel – they can run on gasoline, 100 percent ethanol, or a blend. Now we are working on bio-diesel fuels to replace or be mixed with diesel, and therefore diminish the impact of greenhouse gases.

When I talk about promoting bio-fuels, I know about China's need to produce food. We don't want anyone to be replacing their food production with bio-fuel production. But what we do want is for countries like China to establish partnerships with Brazil and Africa, for us to produce bio-fuels and generate more jobs and income, and at the same time, meet the needs for a new energy blend, which we will all have to adopt. We cannot simply continue taking things out of the planet and not replace them. A clean energy model is an obligation for all of us. If you don't have land to produce but you need energy, you can finance other countries that can produce to meet your market needs. But what we cannot do is to continue to burn diesel, oil, gasoline, coal and firewood, while ignoring the damage we are doing to the planet.
One strength for Brazil is its ethanol comes from sugar cane, a far less energy intensive crop than corn.
Caijing: What else can be done to prevent global protectionism?

Silva: Protectionism often depends on sovereign decisions made by independent countries, and we cannot control that. That's why the WTO is important. It's important to strengthen the WTO. That's where we'll achieve balance, both to avoid protectionist practices and to avoid dumping. That's what will make trade more fair and balanced.

One important thing – I want to bring this up with President Hu Jintao – is that between Brazil and China, we need to establish a trade that is paid for in our own currencies. We don't need dollars. Why do two important countries like China and Brazil have to use the dollar as a reference, instead of our own currencies? We've already started doing this with Argentina. Our trade is taking place in our own currencies. Otherwise, we'll be in an absurd situation, where the country that caused this crisis will be the country that gets the most dollars. It's crazy that the dollar is the reference, and that you give a single country the power to print that currency. We need to give greater value to the Chinese and Brazilian currencies. The governors of our two central banks and our ministers of economy need to put their intelligence to work.
Jim Rogers recently said he expects a currency crisis in the U.S. dollar:
“We’re going to have a currency crisis, probably this fall or the fall of 2010,” Rogers said. “It’s been building up for a long time. We’ve had a huge rally in the dollar, an artificial rally in the dollar, so it’s time for a currency crisis.”

No comments:

Post a Comment