Argentina, Brazil aim at shared currency for 2010

The Mercosur could share a common currency somewhere between 2010 and 2015 if regional governments implement a macroeconomic coordination program that would definitely have positive repercussions in the area´s tourism, Brazilian economist Fabio Giambiagi pointed out.

"The close leadership that we see right now in Argentina and Brazil with presidents Kirchner and Lula, has to move on beyond plain rhetoric," Mr. Giambiagi said in an interview published by Dyn news agency.

In that respect, a proposal for a shared currency will be phased in three stages and ready to beef up the Southern American economic bloc´s full-blown integration.

"The first stage will deal with such goals as lower inflation rates, fiscal objectives and floating exchange rates. Yet, new goals could pop up with each passing day," Mr. Giambiagi said.

For the Brazilian economist, the second stage could be phased in as early as 2005. "For the second phase we´ll need a meeting of central bank presidents who will gather on a regular basis with a view to define caps on inflation rates and currency exchange rates."

In Mr. Giambiagi´s opinion, both Brazil and Argentina could be ready to set identical goals in those fields by the late 2007 and early 2008.

For the final stage of the process, governments could agree on a deadline for the creation of a unified currency. "That could happen between 2010 and 2015," he added.

The Brazilian economist believes his country is "focusing too much on itself because it´s trying to vie against China, when it should be looking more at its neighboring nations, instead."

Mr. Giambiagi, a master on Economics at the University of Rio de Janeiro and former staff member of the Inter American Development Bank (BID), thinks "Worker´s Party voters are disappointed with the Lula administration because the President was forced to come up with so-called orthodox actions in order balance the economy.

Brazil is expected to post a 1.5 percent growth this year and reach close to 3 percent in 2004. "I think the country is marching on the right track, but the final economic takeoff won´t come to pass until 2005," Mr. Giambiagi concluded.