In an announcement that has shocked the world’s financial and political capitals, the President of Brazil Dilma Rousseff and the President of Portugal Anibal Cavaco Silva have confirmed that the one-time Portuguese colony was about to rescue it’s former master.
The basis of the plan to stabilize the Portuguese economy was the formation of a new country, Brazugal, spanning the Atlantic. The current Brazil will be called the “Western Provinces” while the current Portugal is to be called the “Eastern Provinces”. This is not so different than the creation of East and West Pakistan in the South Asia sub-continent in 1947. The new nation is to be formed following a cash investment of some three hundred billion Euros by the Brazilian banks and industry in Portugal. A spokesperson for the Brazilian President denied that this was colonization in reverse, and said that any suggestion that Brazil would take political control of Portugal was unfounded.
Analysts, after recovering from the shock of the announcement, conceded that the idea made some sense. With a GDP of around $2.4 Trillion, Brazil is the world’s sixth largest economy. Furthermore, Brazil desperately needs access to the European markets for its food and burgeoning manufacturing industry. Portugal, with a GDP of around $240 Billion, on the other hand, has little viable manufacturing industry. Portugal will greatly benefit by becoming the bridgehead to Brazil’s manufactured goods. The creation of the new nation will provide Brazil a competitive advantage due to its low wages. An analyst noted that food produced by the Western Provinces of Brazugal would have free access to the EU which Brazil does not currently have.
Perhaps not surprisingly, extreme nationalists and left wing political parties in the Eastern Provinces are united in opposition to the move. “We don’t think that Brazil will treat us any better than the Germans” one activist noted. There has also been some concern regarding immigration from the Western Provinces to the Eastern Provinces. It should be noted that 160 million poor living in the Western Provinces will become EU citizens if the unification is approved by EU. It will then allow citizens of the Western Provinces to freely move east.
A spokesperson for the Brazilian government pointed out that a similar arrangement has existed before. In 1807, the King of Portugal moved to Brazil, and for a few years, Brazil became the seat of Portuguese government.
Brazil’s insistence on appointing an interim President of the Eastern Provinces, however, was proving to be a sticking point. A reliable source has suggested that a past president of Brazil, Lula da Silva, could be appointed as President of the Eastern Provinces. The Portuguese on the other hand want to keep their current government. Negotiations to resolve this dispute are likely to take several weeks. Brazil, not surprisingly, believes that since it is providing the funds to rescue a failed European state, it should be able to demand a complete government reshuffle.
Public opinion in the Eastern provinces is marginally in favor of the radical move, according to a key opinion poll. Some experts believe that if Brazugal was not granted EU membership then the new nation may be able to survive without EU membership. The proposed cash injection would allow the Eastern Provinces to pay off the foreign debt and it may be able to invest in economic development.
At the time of going to print, thegarlic had not been able to obtain a comment from either the German Government or key EU officials although one diplomatic cable released by wikileaks did refer to the union as a dangerous precedent.
