A South American Currency Union? Don’t Hold Your Breath
A South American Currency Union? Don’t Hold Your Breath
"It's been a conversation for many years. I see the benefit for Argentina but what's in it for Brazil?" said AS/COA's Eric Farnsworth to Reuters.
South America is not likely to have a common currency bloc to rival the euro any time soon, analysts said on Monday, despite excited chatter sparked by officials in Brazil and Argentina raising the prospect of a shared tender.
A common tender, like the euro, would need shared political frameworks and institutions that analysts said would take decades to establish. South America's countries have vastly different economic situations—Argentina, for instance, has struggled with inflation for a long time, and it is currently at an eye-watering annual rate of 95%.
"It's been a conversation for many years. I see the benefit for Argentina but what's in it for Brazil? Much less Uruguay and Paraguay," said Eric Farnsworth, a vice president at the Council of the Americas and Americas Society. He called the idea of a currency union a "fantasy."
