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The two countries have recently announced a deal to trade in their own currencies, dropping the dollar as an intermediary. Lula also criticised the IMF, accusing it of ‘asphyxiating’ the economy of certain countries.
Brazilian President Luiz Inacio Lula da Silva criticised the outsize role of the US dollar in the world economy and lashed out at the IMF on Thursday during an official visit to China.
The veteran leftist, whose government recently announced a deal with Beijing to trade in their own currencies – ditching the dollar as an intermediary – is in China to boost ties with his country’s top trading partner and spread his message that “Brazil is back” as a key player on the global stage.
“Why should every country have to be tied to the dollar for trade?… Who decided the dollar would be the (world’s) currency?” Lula said in Shanghai at a ceremony to inaugurate his political ally Dilma Rousseff as president of the development bank set up by the BRICS nations (Brazil, Russia, India, China and South Africa).
“Why can’t a bank like the BRICS bank have a currency to finance trade between Brazil and China, between Brazil and other BRICS countries?… Today, countries have to chase after dollars to export, when they could be exporting in their own currencies.”
Lula also had strong words for the International Monetary Fund, alluding to accusations the IMF forces overly harsh spending cuts on cash-strapped countries like Brazil’s neighbour Argentina in exchange for bailout loans.
“No bank should be asphyxiating countries’ economies the way the IMF is doing now with Argentina, or the way they did with Brazil for a long time and every third-world country,” he said. “No leader can work with a knife to their throat because (their country) owes money.”
‘Brazil is back!’
Lula, who took office in January, is looking…
