Brazil boosted by biofuel production
Brazil's standing in the world economic outlook increased on Friday as President Lula da Silva signed an agreement with US president George Bush to promote and produce ethanol as a biofuel.
Together, Brazil and the US produce 70% of the world's ethanol, from sugar cane and corn respectively, and the industry is hugely important to Brazil economically.
In the 1970s, rising fuel prices sent inflation spiralling upwards and negated the beginnings of economic development in Brazil. The country's increasing energy independence makes it much less susceptible to such price fluctuations, adding stability to the economy.
Biofuel also attracts foreign investment into Brazil, with state energy company Petrobras this week signing an $8 billion (~£4 billion) deal to supply ethanol to Japan.
Mr Lula da Silva added that richer countries buying ethanol from Brazil would fund investment that could increase employment in the country, which would in turn boost the economy further.
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