US, Brazil agree on urgency of trade pact

Brasilia, July 12: US Treasury Secretary Henry Paulson has said that the United States and Brazil agree it is urgent to press for passage of a Doha free-trade pact to benefit both countries' economies.

''Doha is too important to not get done,'' Paulson told reporters after a day of talks with top officials, including Brazilian President Luis Inacio Lula da Silva.

''I don't think anyone thinks it's going to be easy,'' he said yesterday, emphasizing that he had not brought any new proposals for reinvigorating the talks on a four-day Latin American tour that began in Brazil.

Paulson said that when he returns to Washington after visiting Uruguay and Chile, he and US Trade Representative Susan Schwab will discuss the effort to get the Doha trade talks going.

Paulson, who arrived in Brazil on Tuesday, met on Wednesday with the nation's cabinet members, including Finance Minister Guido Mantega. He also met business executives at a lunch.

Speaking to reporters later, Paulson said Brazil's economic future ''has never been stronger'' but stressed that it needed to continue on a path of market-driven reforms that have felled economic growth over the past several years.

''I don't think it's an accident that they also have a market-driven approach and a market-determined currency,'' the US Treasury chief said. ''I emphasized how important it is that they maintain that approach and I sense they agree with me.'' Paulson said he and Mantega had a discussion about the search for a candidate to lead the International Monetary Fund, whose managing director, Rodrigo Rato, is leaving.

''We agreed how it important it was for the IMF to continue reforms and to reflect the changing global economy and changing needs around the world if it is to be as relevant as it has been in the past,'' he said.

European Union finance ministers said on Tuesday that former French Finance Minister Dominique Strauss-Kahn was their candidate of choice to take over the job, but Britain appeared to want other candidates.

Paulson again declined to comment specifically on the merit of the candidacy of Strauss-Kahn, and said it was up to the Europeans to come up with a favored candidate.

''We are very supportive of the Europeans taking the lead in developing a consensus for a strong candidate who will take a global approach,'' Paulson said.

He noted that the United States had recently selected the new leader of the World Bank and that according to the precedent that gave the United States that choice, it was Europe's call to select the IMF leader.

''The ball is in the Europeans' court and we are again looking to them to come up with a candidate that the world can coalesce around,'' he said.

Reuters>