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Why We Won’t See a South American Euro
Lula da Silva’s idea of a South American currency probably won't become reality, or a success.
The former — and possibly future — president of Brazil, “Lula” da Silva, proposed the creation of a South American central bank and currency last week.
A kind of a Southern hemisphere euro equivalent to make the region more competitive, boost economic integration, and cut the dependency on the US dollar.
Sur, as it would be called, would be used together with the national currencies or, in those countries willing to go all the way, to replace them.
In part, you can probably read this as part of Lulas’s intended left-wing populist revival and political competition with the US. He has already taken a side on current global affairs, after all, and it’s looking favorable to Putin.
On the other, the goal is to provide more stability for South American economies, which have traditionally been vulnerable to external shocks and limited to the will of the powerful.
It’s a good idea, in theory. But I don’t see it happening any time soon. Here’s why.
