Will Ukraine manage to gain a foothold in the Latin American market?

“How would you characterize the present level of cooperation between our countries? What should the two countries do to increase their commodity turnover?”

“The Brazilian government believes that the legislation in force encourages the development of joint projects in various industries. Cooperation in the space sector commands the greatest interest, since the Ukrainian-Brazilian Agreement on the Protection of Technologies recently ratified by the National Congress of Brazil has created many opportunities for the deepening of such cooperation. As for trade and economic cooperation, I have to admit that its level is quite low considering the potential of our markets and the economic parameters of our countries. At the same time, there are signs of increasing cooperation. In 2002, Brazil and Ukraine reached a total turnover of $111.3 million. Meanwhile, in the eight months of this year it came to $127 million. Moreover, trade between our countries involves a great deal of trade operations performed via third countries, which somewhat skews the statistics. For example, Brazilian coffee is supplied to the Ukrainian market by European intermediaries. This situation could change, when Brazilian businessmen start visiting Ukraine more often (which they are doing already) and find a direct path to Ukrainian wholesalers and consumers.”

“Can we say that Brazil is interested in obtaining Ukraine’s rocket technology to develop its own space program and be able to launch its satellites into orbit?”

“Brazil already has its own space program, even though we haven’t yet managed to make a successful launch of our own carrier rockets. The overriding goal of the Ukrainian-Brazilian program is to use all our advantages: Brazil has a launch pad close to the equator, which reduces the cost of launches, and Ukraine has rockets and technology. If combined, we could start using them for commercial purposes for the benefit of both countries. On the other hand, in the future some parts of the carrier rockets will be manufactured in Brazil, which will expand the country’s existing industrial potential. This will also reduce the cost of launches. It is noteworthy that our space program envisions the launching of satellites only. The recent launch of our satellite in a joint project with China coincided in time with President Kuchma’s visit to Brazil.”

“Ukraine has built bridges with Malaysia and Libya to promote its products on the markets of South East Asia and Africa. Can Brazil become a bridge for promoting Ukrainian products and technologies on Latin American markets?”

“Indeed, this is possible. First, Brazil has an expanding domestic market that is in itself interesting for Ukraine. Moreover, I think it is only natural that most initiatives of the Ukrainian government with respect to Brazil are meant to increase Ukraine’s penetration of the Latin American market in general. For example, the joint satellite launch project cannot be restricted to Ukrainian and Brazilian clients only. To make this project profitable, we should also launch American satellites. I know that Ukraine is negotiating possible launches of satellites using its Cyclone-4 carrier rocket from the Chilean Alcantara space launch facility as well as from Argentina and other Latin American states. As for gas turbines, it should be noted that Brazil is restructuring its energy sector. Until recently, we were betting on hydroelectric power plants. But it transpired that such a one-sided approach doesn’t meet the country’s growing electrical energy demands. We have decided to diversify power sources. We have developed a major project to use natural gas more extensively as a fuel for new thermal power plants and use natural gas instead of fuel oil at the existing power plants. It is an open secret that Ukraine wants to manufacture gas turbines not only for the Brazilian market, but also for other Latin American markets. For one thing, it will be easier for Ukrainian turbines to get into Mercosur, because no customs duties will be levied on them.”

“Does the Brazilian leadership share the optimism of Ukraine’s National Space Agency that the satellite launch project will return a profit in three to four years?”

“As far as I know, the Cyclone-4 rocket will be tested from 2005 till 2007, with the first commercial launch planned for early 2007. I’m not quite sure that Brazil expects the project to return a profit within a short term. The goal of this government sponsored space project is above all to gain experience and master the technology. This is a long-term strategic project. When the government decides to support a project like this, it is not guided by economic considerations and criteria of profitability alone. Mastering the technology means investment in the future.”

“In connection with the Tuzla crisis some Ukrainian politicians have spoken about the need for Ukraine to reclaim its nuclear status. At one time Brazil decided not to attempt to build its own atomic bomb. In your view, would it not be better to have one’s own nuclear arsenal, so that nobody would dare make territorial claims on your country?”

“He who has weapons must also have enemies. Brazil maintains friendly relations with all its neighbors. I don’t think it would be useful for us to have nuclear military technologies. This would entail cutting the funding for the social and economic sphere. In the past, in the years of military regimes in Brazil and much of the Latin American states the climate was favorable for an arms race, but this is not the case now. The countries are negotiating further integration, opening the borders, and expanding cooperation. We have put forward many initiatives and not only within Mercosur. We are also working to expand cooperation with the members of the South American Andes Commonwealth and form a common market in South America. These are issues most discussed by politicians in our region.”