Brazil’s Senate approves Venezuela in Mercosur

Brazil’s Senate on Tuesday approved Venezuela’s request to join the South American trade bloc Mercosur despite concerns over President Hugo Chavez’s restraints on democracy.

The Senate voted 35-27 in favor of Venezuela joining the 18-year old customs union. The proposal must now be approved by Paraguay’s parliament before Venezuela can join. Paraguay is the only other member country that had not yet approved it.

At stake are huge investments and trade with the OPEC nation and potentially Venezuela’s geopolitical ties to the region. President Luiz Inacio Lula da Silva has lobbied hard for Venezuela to the join the group that is made up of Brazil, Argentina, Uruguay and Paraguay. Chile, Bolivia, Peru, Ecuador and Colombia are associate members.

The Lula administration has been eager to expand Mercosur as a counter-balance to trade interests of industrialized nations.

Some analysts said that denying Venezuela membership could isolate Chavez from South America and push him to deepen ties with distant allies such as Iran, Russia, and China.

Opposition senators who voted against the proposal said Venezuela did not comply with Mercosur’s democratic principles because Chavez did not respect constitutional rights of opposition politicians and suppressed the media.

Critics also said Venezuela’s haphazard economic policy, which includes the nationalization of several industries, could further undermine the unity of Mercosur.

“Unity, what unity,” asked Brazilian Industry Minister Miguel Jorge said on Tuesday in reference to a host of trade spats within Mercosur.

“I’m for Venezuela’s entry but (Mercosur) needs to be taken serious,” he told reporters.

Brazil has a trade surplus of around $5 billion a year with Venezuela, with Brazilian contractors holding $20 billion worth of orders for public works projects there.