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by Staff Writers Brasilia (AFP) April 5, 2012 President Dilma Rousseff will next week propose to US counterpart Barack Obama that the two countries work together to end the "currency war" that is hurting Brazil, a spokesman said Thursday. Brazil, Latin America's dominant power and the world's sixth-largest economy, has blamed the real's appreciation on a "currency war" waged by rich countries, which are flooding the market with dollars through cheap credit. "The excess liquidity will be analyzed in the context of the crisis in general and the need for the United States and Brazil to work together to find a solution," foreign ministry spokesman Tovar Nunes said on Twitter. The Rousseff government has come under intense domestic pressure from industrialists and labor unions to act decisively to bring down the value of the real, and to combat unfair foreign competition. During a visit to Germany in March, Rousseff complained that rich nations were responding to the global financial crisis with easy credit and low interest rates -- and that cheap money was making its way to Brazil, which has high interest rates and a strong currency. "We are concerned about this monetary tsunami" caused by the "developed countries," she then said. The foreign currency influx into countries such as Brazil leads to a stronger real and increased imports, and makes Brazil's exports more expensive. "It is a serious problem. We are suffering from this. Therefore we need to join forces with the United States to find a lasting solution," Nunes said. The spokesman said the White House talks between Obama and Rousseff next Monday would also focus on "the economic crisis and coordination" by the two countries in the G20 group of rich and emerging powers. Other topics to be covered include trade, investment in energy, aviation, education, science, technology and innovation. We want to "move forward in our alliance for production of aviation biofuel, renewable energy and joint investment in oil exploration," Nunes said. Brazil's contract to supply its air force with 36 multi-role combat aircraft may also come up, although it is not on the agenda, the spokesman said. US aviation giant Boeing's F/A-18 Super Hornet is competing with the Rafale fighter, made by French firm Dassault Aviation, and Swedish manufacturer Saab's Gripen jet for the contract valued at between $4 billion and $7 billion. Brasilia hopes to make a decision in the first half of this year. Rousseff was due to arrive in Washington Sunday and to meet Obama the following day. During her US visit, she also plans to visit Harvard University and the Massachusetts Institute of Technology and meet with Brazilian students.
Global Trade News
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