(Adds Temer comments, background)
BRASILIA, June 24 (Reuters) - Brazil’s interim President Michel Temer said the Mercosur trade bloc poses an obstacle to other trade agreements and needs to be revised, but not ditched altogether.
In a radio interview on Friday, Temer also said the British vote to leave the European Union was a political decision and it would be inappropriate for him to discuss it, adding that Brazil should brace for the economic consequences of the exit.
Mercosur was launched in 1991 to foster trade in South America but has increasingly become a left-leaning political forum since Venezuela’s entry in 2012. Brazil’s top diplomat under Temer, Jose Serra, has already urged the bloc to become more flexible and shift its focus back to trade.
“We need to rediscuss Mercosur at this moment, not to eliminate it, but to give us a safer position to seek to broaden our relations with other countries,” Temer said.
Temer has pledged to take Brazil’s economy out of its worst recession in generations by fixing public finances and restoring business confidence. His administration also plans to move away from ideologically driven diplomacy and focus more on trade, Serra said after taking office as foreign minister in May.
Venezuela, which is mired in a deep political and economic crisis with food shortages and hyperinflation, was set to take the rotating presidency of Mercosur this month, despite resistance from Brazil and Argentina.
Brazil’s suspended President Dilma Rousseff, who now faces an impeachment trial in the Senate over budget laws, and her predecessor made Brazil one of the most powerful allies of Venezuela’s leftist government over the past decade. But Temer’s center-right government, which came to power with Rousseff’s ouster, has put distance between Brasilia and Caracas.
Temer also said that nobody has discussed raising taxes on farming, as local media had published, and that his administration is monitoring the debt level of Brazilian cities following a federal bailout of state governments. (Reporting by Lisandra Paraguassu; Writing by Silvio Cascione; Editing by Phil Berlowitz)
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