Luis Inacio Lula Da Silva won the election of President-Elect on October 30 against Jair Bolsonaro of Brazil. This could be the beginning of the idea of a Latam single currency. Lula declared this in his campaign. It was a call for a common currency, as it would reduce inflation and decrease dependence on the U.S. dollars.
Brazil’s Lula Might Spearhead Proposal of Single Currency in Latam
The tight electoral victory that now-President-Elect Lula Da Silva has obtained on Oct. 30 might bring the rise of a new common currency for Latam, judging by the politician’s statements. As a left-wing Brazilian politician who is a member the Workers Party, the candidate had mentioned the need for one currency across the continent during his presidential campaign. This was to explain the possibilities that such an opportunity might present.
Lula spoke out on this subject at a rally that was held on August 30, and stated:
We will restore our relations with Latin America. If God wills, we’ll create a Latin American money.
According to Lula’s collaborators, this currency might be called Sur (Spanish for “South”) and could be capitalized based on the trading volumes of the countries on the continent. “We don’t have to depend on the dollar,” Lula said at the time, clarifying that the objective of such a currency would be to undermine dependence on the U.S. dollar, the influence of which is said to have caused many troubles and economic imbalances in countries like Venezuela and Argentina.
International Circumstances and More Money Projects
Lula might be able to realize this idea if the geopolitical positions of other Latam governments are favorable, since the continent has a majority of its governments looking left in terms of their policy outlooks.
At the August 7 inauguration of Gustavo Petro as Colombia’s president, Gabriel Boric from Chile commented on the matter, saying that while he is open to such a proposal, there are still many things to do. This could lead to the revitalization of multi-country integration groups like the Andean Community and Celac, the Community of Latin American and Caribbean States.
There are several other global proposals to replace dollar as reserve or trading currency. Russian President Vladimir Putin has announced a BRICS project that would create a single currency based off the basket currencies of the countries within the group at the 14th BRICS Summit. Reports also claim that China and Russia are involved in creating a gold-backed currency.
How do you feel about the possibility that a Latam common currency could be issued? Leave your comments below.
Image creditShutterstock.com, Pixabay. Wiki commons. Wagner Vilas
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