Brasília – After vehemently criticizing the French government’s idea of regulating the global agricultural market, which was championed by president Nicolas Sarkozy at the last meeting of the G-20 (which comprises the world’s 20 leading economies), the Brazilian minister of Agriculture, Wagner Rossi, acknowledged this Thursday (7th) that there was a misunderstanding in the Brazilian government’s interpretation. The minister guaranteed that France is "completely contrary to price control."
After meeting with the French minister of Agriculture, Bruno Le Maire, Rossi stated that the French proposal seeks "food security and greater equilibrium between prices and agricultural supplies." And he underscored the country’s importance within this context: "Brazil is one of the leading agricultural powers in the world, and with that comes responsibilities."
Le Maire, who claimed to be deeply impressed with the success of Brazilian agriculture, said he made a point of coming to Brazil to clear up the misunderstanding and seek a consensus for the large meeting of agriculture ministers of the G 20, due June 22nd and 23rd, in Paris. According to him, at the meeting, the French proposals will be presented to the world "in an objective fashion." Earlier, the minister said he will visit the United States and China to seek greater support.
The French minister also claimed that generally speaking, the idea of regulation is based on four points: greater transparency in global food inventories, with Brazil as an example; greater cooperation among 20 member countries for fighting crises more swiftly, so that they will develop their agriculture and prepare themselves beforehand; and financial regulation of agricultural markets, so as to prevent the entry of speculative capital, which is increasingly geared towards the agricultural sector after the crisis of 2008.
"Financial market regulation is aimed at making it work better. France opposes all types of price control or price charts," said Le Maire. "We propose a better global organization in agriculture, one that will enable the major agricultural powers to go on developing while protecting themselves from crises, avoiding price volatility and supporting the poorer countries."
Le Maire emphasized the French government’s belief that a bubble is coming up in the agricultural market. "If we do not regulate the agricultural market, then the exact same thing that happen with real estate will happen with it," he said upon comparing the scenario of agricultural commodities to the real estate situation that triggered the financial crisis of 2008.
The two ministers stressed, however, that the most efficient path to preventing these problems is to increase production. "Insufficient production will lead to popular uprisings in poor countries, such as those now taking place [in North Africa]," said Le Maire. He claimed that food price inflation is a problem to the entire world, and in France, it is felt mostly in the prices of spaghetti and bread.
The French minister also touched on issues for which the two countries have reached no consensus yet, such as sanitary requirements of the European community, which are considered too strict by the Brazilians, and the use of genetically modified organisms. With regard to transgenic food, Le Maire was to the point: "Brazil and the European Union have made different decisions. We need to respect those decisions."
*Translated by Gabriel Pomerancblum
