Ricardo Haussman on Brazil, Venezuela, Lula and Chavez

December 30, 2002

Ricardo Hausmann, Economist and former Venezuelan Minister of Planning and Professor of of the School
of Government at Harvard University on Lula and Chavez, in today’s interview
in El Nacional, page B-2:

“I think the backing Lula has just given to Chávez will be costly for
Brazil. I am sure that his economic and foreign relations team is going to
complain to him”


“Brazil’s economic situation is very fragile. If good things don´t happen ,
even those that nonbody is expecting, Brazil is going to explode in the
sense that the exchange rate and interest rates will stay where they are,
thus they are going towards a financial crisis. Financial markets see Lula
and they perceive that he has all the incentives of the world to say what
they all want to hear, but they don’t belive what he says and are awaiting
his actions. Nevertheless, the lackluster mission of his international
advisor, Marco Aurelio García, in Venezuela, and the reaction when he
arrived in Brazil, indicate to international  financial markets that perhaps
Lula is more like Chávez than what he claims to be and what he has said
abroad. I think that Lula’s association with Chávez will be costly to his
Government in term of loss of confidence, at a time of financial fragility
in Brazil. Moreover, if Chávez ends up not being sustainable in Venezuela,
Lula will leave a vacuum in its bilateral relations with Venezuela, which is
not in the national interest of Brazil.”

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