Brazil and Argentina study the creation of a common currency

(Reuters) – Brazil and Argentina will this week announce the start of preparatory work to create a common currency, the Financial Times reported on Sunday.

The project, which is scheduled to be discussed this week at a summit in Buenos Aires, aims to build a currency that can boost regional trade and reduce dependence on the US dollar, the newspaper said, citing officials of both countries. Brazil suggested that this currency be called the “sur” (the south).

“There will be (…) a decision to start studying the necessary parameters for a common currency, which includes issues ranging from budgetary issues to the weight of the economy (of each country) through the role of banks power plants,” Argentina’s economy minister Sergio Massa said, quoted by the Financial Times.

The idea had already been broached in 2019 by politicians in both countries before being rejected by Brazil’s central bank at the time.

The new common currency project could later be extended to other Latin American countries, the newspaper adds, adding that an official announcement is expected during the visit Sunday evening of Brazilian President Luiz Inacio Lula da Silva in Argentina.

(Report Jyoti Narayan in Bangalore; French version Claude Chendjou)

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