* Two BRIC giants want to work on space, planes together
* Lula makes fourth visit to Moscow, Iran on agenda
* Lula says BRICS should trade in own currencies
* Brazil complains Russia not sharing military know-how
(Adds Lula comments on currencies, defence ministry complaints)
By Michael Stott and Fernando Exman
MOSCOW, May 14 Brazilian President Luiz Inacio
Lula da Silva called for closer business and investment ties
with Russia on Friday, saying the two BRIC states should use
their own currencies for trade, not the dollar.
"From 2002 to 2008, trade between Russia and Brazil grew
five times," Lula said in a speech to a business forum during a
visit to Russia.
"But that is not enough. We need to make a quantative leap
... and define new areas for partnership in areas like energy,
infrastructure and space exploration."
Lula said a first step would be for Russia and Brazil to
trade using their own currencies instead of dollars or euros.
"We can't...do business in another currency which we don't
control and we don't produce," he said. "This is a challenge for
Brazil and Russia, a challenge for Brazil and the BRICs and a
challenge for the new commercial logic of the 21st century."
"There is no explanation for why we are doing
business...using a third currency when we could strengthen our
Lula then met President Dmitry Medvedev at the Kremlin,
their second meeting in less than a month, after Medvedev
attended a summit of the BRIC nations -- Brazil, Russia, India
and China -- in April in Brasilia.
Lula made his fourth visit to Moscow, an indication of the
importance attached by both sides to developing new
relationships that reflect the growing economic and political
clout of the BRIC states.
After Moscow, Lula is heading to Tehran, making what
Washington has termed "perhaps the last big shot" at persuading
Iran to negotiate over its nuclear programme before new U.N.
Brazil and Russia are both unenthusiastic about new
sanctions against Iran until all other avenues for dialogue have
Brazil and Turkey, which hold rotating seats on the U.N.
Security Council, have talked to Iran to try to revive a
moribund agreement under which Tehran would send low-grade
uranium abroad for processing and receive higher-grade uranium
Lula and Medvedev were also to sign a strategic partnership
agreement which will map out how their relations will develop,
the Kremlin said.
The pact calls for increased cooperation on energy -- where
Russia is offering Brazil nuclear power technology and gas
liquefaction technology -- and in high-tech areas such as space
exploration and aircraft building, officials on both sides said.
Russia's giant gas firm Gazprom (GAZP.MM) plans to open an
office in Rio de Janeiro this year as part of these efforts, the
At the same time, the development of military partnership is
being hampered by the Russian government's unwillingness to
accept any transfer of technology, said Brazilian Defence
Minister Nelson Jobim, one of Lula's delegation on the trip.
Russia entered a Brazilian government tender for the
purchase of 36 new fighters for the Brazilian Air Force but did
not get into the shortlist.
"They did not qualify (for the tender) because of this (a
lack of transfer of technology)," the Defence Minister said.
Dassault's Rafale fighter, Boeing's F-18 and Saab's Gripen
fighter are still in contention.
Russia and Brazil are both major commodity nations, with
Russia among the world's top energy and metals producers and
Brazil strong in exports of agricultural products, iron ore,
cars and machinery.
Trade between the two BRIC giants grew to $6.8 billion in
2008 but fell back to $4.6 billion the following year because of
the global financial crisis, the Kremlin said. Lula said he was
confident Brazil-Russia trade could pass $10 billion this year.