Ben Norton Economy Politics

[Rewind] Brazil’s Lula Proposes Creating Latin American Currency to ‘Be Freed of US Dollar’ Dependency

Brazil’s left-wing leader Lula da Silva says if he wins the 2022 presidential elections, “we are going to create a currency in Latin America,” called the Sur (“South”), to combat “the dependency on the dollar."
President Luiz Inácio Lula da Silva exchanges greetings with the presidents of Bolivia, Evo Morales, and Chile, Michelle Bachelet, at the end of the summit meeting of the Union of South American Nations (Unasur). Antônio Cruz/ABr, CC BY 3.0 BR https://creativecommons.org/licenses/by/3.0/br/deed.en, via Wikimedia Commons

By Ben Norton / Multipolarista

This story was first published in May 2022 but following Lula’s recent victory in Brazil’s presidential election, ScheerPost feels it is important to share this piece from Ben Norton.

Brazil’s left-wing leader Lula da Silva has proposed creating a pan-Latin American currency, in order to “be freed of the dollar.”

A founder of Brazil’s Workers’ Party, Lula served as president for two terms, from 2003 to 2011. He is now the leading candidate as Brazil’s October 2022 presidential elections approach.

If he returns to the presidency, “We are going to create a currency in Latin America, because we can’t keep depending on the dollar,” Lula said in a speech at a rally on May 2.

He revealed that the currency would be called the Sur, which means “South” in Spanish.

Lula explained that countries in Latin America could still keep their sovereign domestic currency, but they could use the Sur to do bilateral trade with each other, instead of having to exchange for US dollars.

The Sur could also help to contain inflation in the region, Lula argued.

Lula said the goal of the currency would be to deepen Latin American integration and strengthen the region’s economic sovereignty, weakening its dependence on the United States.

Under Brazil’s current government, led by far-right leader Jair Bolsonaro, the South American giant has subordinated itself to Washington, while viciously attacking the left-wing governments in the region.

Bolsonaro’s Brazil has refused to recognize the legitimacy of the leftist Chavista government in its neighbor Venezuela, and has even supported violent cross-border terrorist attacks against it.

If he returns to the presidency, Lula pledged that Brazil “will strengthen its relations with Latin America.”

Lula has also vowed to revive the BRICS system, integrating Brazil, Russia, India, China, and South Africa in an independent economic architecture to challenge Western financial hegemony.

In 2020, Lula published a call “For a Multipolar World.” He explained his goal is “the creation of a multipolar world, free from unilateral hegemony and from sterile bipolar confrontation,” that “would permit a true re-founding of the multilateral order, based on principles of real multilateralism, in which international cooperation can truly flourish.”

Hugo Chávez’s attempt to create a pan-Latin America currency, the Sucre

Lula’s proposal for the Sur is certainly not the first time progressive politicians in Latin America have tried to create a common currency. This has long been a dream of left-wing leaders in the region.

Venezuela’s revolutionary former president Hugo Chávez developed an international currency as part of the Bolivarian Alliance (ALBA), an economic coalition of left-wing governments in Latin America and the Caribbean.

This currency was called the Sucre, and was adopted in 2009 by Venezuela, Nicaragua, Cuba, Bolivia, and Ecuador.

Sucre was an acronym for “Unified System for Regional Compensation,” but also a reference to Antonio José de Sucre, who helped lead the South American independence struggle against Spanish colonialism, alongside Simón Bolívar.

Ecuador’s government, under leftist President Rafael Correa, who has a Ph.D. in economics, was the main adopter of the Sucre.

At its peak in 2012, the Sucre was used for more than $1 billion in bilateral annual trade in the region.

The symbol for the Sucre, used by the ALBA

But the currency fell out of use by 2016, following Chávez’s death in 2013, a massive drop in commodity prices in 2014, the imposition of US sanctions on Venezuela in 2015, and violent coup attempts against Chávez’s successor Nicolás Maduro.

Ecuador’s subsequent right-wing President Lenín Moreno, with US backing, later removed his country from the ALBA, dealing a huge blow to the Sucre and dreams of regional integration.

Lula leads polls for Brazil’s 2022 elections, following US-backed judicial coup

Brazil’s presidential elections will be held in October 2022.

Polls consistently show Lula leading over far-right candidate Jair Bolsonaro, Brazil’s sitting president.

Bolsonaro only came to power in the 2018 elections due to a soft coup d’etat backed by the United States.

Lula had been significantly ahead in the polls in the lead-up to the 2018 vote, but Brazil’s judicial system imprisoned him on false charges, handing the victory to Bolsonaro.

The US Justice Department helped support this campaign of what Lula calls legal warfare, or lawfare, to prevent him from returning to the presidency.

The US government also backed the 2016 political coup against Brazil’s democratically President Dilma Rousseff, also a member of Lula’s left-wing Workers’ Party.

The UN Human Rights Committee found this April that the prosecution of Lula was politically motivated and violated his rights.

“The investigation and prosecution of former President Lula da Silva violated his right to be tried by an impartial tribunal, his right to privacy and his political rights,” the UN legal experts determined.


Subscribe to our weekly newsletter

* indicates required
Benjamin Norton
Benjamin Norton

Ben Norton is a journalist, writer, and filmmaker. He is the founder and editor of Multipolarista, and is based in Latin America.

9 comments

  1. Little do they know that the benefit and the continual use of the USD price tool as the global “measure of measures” in vitally important to them and to all. It’s not a currency application but simply a translator of value. A price is a measure of value that can be used in debt-based trades and also debt-free trades for the sake of market agreements , scalable liquidity and market balancing.

    If for any reason, the USD REAL-TIME price data was not made available to them (proprietary property), their economies would falter and cave. The people who developed the Euro surely know this now. People who also want to conduct debt-free transactions (p2p) are also coming to realize this now.

    1. DEFENSES OF CAPITALIST BELIEFS ARE AMUSING

      Arguments like the one above hang together only as long as the reader doesn’t notice the logical fallacies:

      1.) Circular reasoning. Treating as a given what you’re trying to prove.

      2.) Argument by authority. Pronouncements as if from a superior speaking down to ignorant lessers– “little do ‘they’ know…”

      3.) Assuming that your theoretical underpinnings are valid for all places and all times. Or valid at all. Echoing the assumption that //the market// (the term itself a prime example of what Whitehead called “the fallacy of misplaced concreteness”) functions by means of perfect information and equal access for all participants.

      And special case 4.) The use of jargon to intimidate possible critics.

      As part of a panel discussion just before the WTO 1999 meeting later known as The Battle of Seattle, I wrote the following:
      *There is a force said to rule all else. Its rules interpreted by a powerful group of mostly older white men who wield frightening mathematical symbols and incomprehensible words. They and they alone understand its dogma. Telling us it’s for own own good, they urge strict obedience. Believe them or else. Any violation is said to bring hellish consequences. Which sounds like bad theology because it is: this is the belief system of capitalism.*

  2. Somebody, please communicate to the newly elected Brazilian President Lula that Mohmad Khadafi of Libya had also proposed to create a ‘new’ currency for Africa (and all oil trading nations) — and we know how that turned out. Khadafi was beaten to death in his underwear.
    Be careful President Lula. Your ‘currency’ proposal is a very danger one.
    The United States of America has numerous means at its disposal in getting rid of those leaders who challenge its global financial hegemony.
    President Lula — I strongly advise you to tread lightly on this matter.

    1. The newly elected Brazilian President, has not been seated, yet perusing your comment, it reads like an explicit state terrorist threat, on behalf of the US!
      In the short decade-plus since the end of 2011, the world has come a long way.
      The downward spiral changes in America’s unilateral, hegemonic predominance, have been dramatic, Professor, in case you haven’t noticed.
      Does the same threat apply to China, Russia and the other breakaway countries of Asia and the ‘South’?

  3. I’m happy for Mr. Lula that he won, and think it’s probably in Brazil’s best interest that he did.

    On the other hand, I strongly believe that there are much more fruitful ways for Mr. Lula to spend his energy to than a wild-goose chase after a currencey that has no optimum currency area to base it on. There is no labour mobility between Latin American countries, no openness with capital mobility and price and wage flexibility across the region, no automatic fiscal transfer mechanism to redistribute money to areas/sectors and participant countries not having similar business cycles. This makes a Latin American currency a complete non-starter.

    Mr. Lula need only study the travails of the Euro (where several of the requirements of an optimum currency area are fulfilled, and one that wasn’t (fiscal transfer) was forced into existence by a series of crises) to understand that what he proposes is a waste of time.

    Oh well, his time is his own to waste, but in doing so he is totally squandering the vote that proopelled him to power.

  4. Yes, Dr. Randall Doyle is right, but he forgets to mention that Sadame Hussein also planned on removing Iraq’s oil supply from the US dollar, and accept only Euros for payment. Remember what happened to him?

  5. I do not understand this urge to create new multinational currencies. Didn’t the Euro fiasco teach anything? Why not just use your national currencies.?

  6. the dollar is dead—-US hegemony dead….even EU central banks are de-dollarizing—-already many nations ignore the Petro-dollar and trade in national currencies….americans and their currency cannot be trusted

Comments are closed.

%d bloggers like this: