Putin Redirects Russia to BRICS Countries and Wants Currency; Bolsonaro does not mention the war – 06/22/22

Without mentioning the war in Ukraine and without even mentioning the Russian invasion Mr. President Jair Bolsonaro He said this Wednesday at a BRICS event that the country is concerned about the “international context” and its impact on trade, supply and investment flows.

However, the Brazilian maintained his diplomatic style and also avoided criticism of Western countries, which were the target of interrogations and attacks from China and Russia. The speech was delivered at the BRICS Business Forum, through a pre-recorded video. The event serves as a prelude to the group summit, scheduled for Thursday.

But Vladimir Putin’s participation for the first time since the start of the war in Ukraine in a major international meeting caused wide repercussions.

And the Russian announced during the preparatory event that his country is redirecting trade relations and investments to the countries of the emerging bloc of economies, in the face of the sanctions imposed by the Americans and Europeans. In addition, he talked about creating alternative financial systems and resumed the idea of ​​creating a common currency to allow the flow of goods between the economies of the group.

Xi and Putin criticize the West, suggest greater alliance of emerging countries

If Bolsonaro avoids turning his participation into an attack on the United States and Europe, Chinese President Xi Jinping, as host, has called for an effort to seek peace. But, as UOL predicted on Tuesday, there was no agreement among the five countries in the bloc to make a declaration of support for Putin.

Xi still sends messages to Western powers. “History shows that hegemony and political groups and confronting blocs do not bring peace or stability. Rather, war and conflict,” he said.

An avowed ally of Putin, the Chinese openly criticized Western powers. “The Ukrainian crisis has sounded the alarm bell for humanity,” he said. Referring to NATO’s expansion in Eastern Europe, the Chinese said, “Countries will certainly face security problems if they place blind faith in their positions of power and expand their military alliances. They seek to achieve their security at the expense of others.”

In his speech, Putin also directed his criticism of the West. He warned that “while more and more politically motivated sanctions are being imposed, pressure mechanisms on competitors are being strengthened.”

“There is a deliberate destruction of cooperative links; transport and logistics chains have been destroyed. And all this is contrary to common sense and basic economic logic, it undermines commercial interests on a global scale, and adversely affects the well-being of people, in fact, of all nations”, without referring to the fact that this It is the European and American response to the Russian invasion of Ukraine.

But Putin insists the result is a scenario in which “problems in the global economy recur”.

“What we are seeing is an economic slowdown, rising unemployment, a shortage of raw materials and ingredients. The problems of ensuring global food security are getting worse, and the prices of grain and other basic agricultural products are inflating,” he said, without also saying any reference to the blockade of Ukrainian ports by Russian forces.

Putin announces the reorientation of his economy with the BRICS countries and even talks about the currency

For Putin, given the scenario, the emerging mass needs to unite. “We are actively involved in redirecting our foreign trade flows and economic contacts to trusted international partners, first and foremost with the BRICS countries,” he said.

“It is important, despite all the problems and difficulties, that the BRICS trading circles constantly work to strengthen mutually beneficial relations in the areas of trade, finance and investment,” he said.

According to him, in the first three months of this year, trade between Russia and the BRICS countries increased by 38%, reaching $45 billion.

Putin also used his rhetoric to signal a reorientation of his economy. “Contacts between Russian business circles and the business community of the BRICS countries have intensified,” he said.

According to him, negotiations are underway to open an Indian chain of stores in Russia, to increase the share of Chinese cars, equipment and appliances in our market. “In contrast, the Russian presence is increasing in the BRICS countries. There has been a noticeable increase in Russian oil exports to China and India,” he said.

He also touched on the situation with Brazil. “Agricultural cooperation is developing dynamically. Russia exports large quantities of fertilizers to the BRICS countries. Russian IT companies are expanding their activities in India and South Africa, and our satellites allow television broadcasting to more than 40 million residents of Brazil,” he said.

Putin also highlighted how to create new alternative mechanisms with emerging mechanisms in the face of financial sanctions. “We are studying the possibility of creating an international reserve currency on the basis of the BRICS basket of currencies,” he said.

According to him, the Russian business community, in coordination with the business communities of emerging countries, is taking steps to develop new logistics methods and new production chains.

“We are ready to work openly with all partners in good faith on the basis of the principles of mutual respect for each other’s interests, the rule of international law and equality among all nations and peoples,” he said.

In general, I would like to note that Russia is taking comprehensive measures aimed at mitigating the negative impact of sanctions and strengthening our trade and investment relations with all concerned countries. Our macroeconomic policy proves its effectiveness in practice. We managed to protect the Russian financial system and began to stabilize the situation in the sector by providing targeted social support to citizens.

Bolsonaro: Context concerns

On the other hand, Bolsonaro chose to avoid political topics and found himself in his economic message. “The current international context is cause for concern due to risks to trade, investment flows and the stability of energy and food supply chains,” he said.

Using these terms, Brazil has avoided criticizing Russia for the war and has not yet opened a front against the Americans and Europeans, the setters of sanctions.

“Brazil’s response to these challenges is not to close ourselves off to the rest of the world. On the contrary. We have sought to deepen our economic integration,” he said. He saw it as a “satisfaction” to share the same spirit of cooperation with the rest of the bloc’s members.

In his speech, Bolsonaro also focused on the positive aspects of the rapprochement between BRICS businessmen and insisted that his goal was to “improve Brazil’s integration into international trade and investment flows”.

He also used the engagement to sell his economic agenda, noting that he had taken steps to make the regulatory framework more secure and transparent. Bolsonaro also cited measures of economic freedom and Social Security reform. He pointed out that “one of the government’s goals is to expand the participation of the private sector in the economy, and to promote investments in infrastructure.”

Bolsonaro also highlighted Banco do Brics as a tool to “contribute to the growth of our economies” and is betting that the opening of the institution’s office in Brazil will allow it to expand its operations in the country.

When he explained to businessmen that Brazil wants to establish itself as a “secure and stable hub for investments,” Bolsonaro noted that “the process of entering the OECD will be another step in that direction.” According to him, Brazil wants to participate constructively in determining the direction of the world economy.