- The Washington Times - Wednesday, April 18, 2007

BUENOS AIRES — Venezuelan President Hugo Chavez yesterday backed away from earlier attacks on an ethanol deal between the United States and Brazil in a move that was seen as a diplomatic setback for Cuban President Fidel Castro.

“We aren’t against biofuels,” Mr. Chavez said at a regional energy summit attended by Latin American heads of state in Venezuela. “In fact we want to import ethanol from Brazil.”

The statement followed several sharp attacks on an ethanol deal concluded between the United States and Brazil during a visit to the region by President Bush last month.

Brazil is the world’s leading producer of sugar cane-based ethanol while the United States is the world’s biggest producer of corn-based ethanol.

Mr. Chavez has praised ethanol in the past as an environmentally sound companion to gasoline, even announcing plans in March to build 29 ethanol plants in his country. But since the March agreement, Mr. Chavez has argued that a Washington-backed ethanol push would damage food production in Latin America.

His change of heart followed a March newspaper editorial in which his ideological mentor, Mr. Castro, referred to the U.S. ethanol plans as “the sinister idea of converting food into fuel.”

Reportedly facing stiff diplomatic criticism from Brazil, Mr. Chavez yesterday said he has problems only with corn-based ethanol made in the United States, not sugar-cane ethanol produced by Brazil.

“The media says there is an ethanol war,” Mr. Chavez said, according to wire reports. “Ethanol is a valid strategy as long as it doesn’t affect food production.”

He continued to criticize U.S. plans to boost corn-based ethanol, saying it would “take corn away from people and the food chain to feed automobiles.”

Mr. Chavez said Venezuela, a major oil exporter, needs to import 200,000 barrels of ethanol a day from Brazil. He also called on Washington to end ethanol tariffs, a request being strongly pushed by Brazil’s President Luiz Inacio Lula da Silva.

Some analysts saw Mr. Chavez’s about-face yesterday not just as a diplomatic win for Brazil but a sign that Mr. Castro’s influence in the region is diminishing.

“This shows Brazil is a winner in this debate,” said Jorge R. Pinon, a University of Miami energy researcher and a former president of Amoco Oil Latin America. “But the big loser is Fidel Castro, who from his sickbed brought this ethanol issue to the forefront.”

Mr. Pinon said the issue had been “blown out of proportion” and that the Brazilian-U.S. deal had been converted by Mr. Chavez and Mr. Castro into a political charade with Brazil “sitting in the middle.”

“The U.S. needed an issue that can help demonstrate interest in the region,” he said. “It happened to be ethanol.”

Florida Gov. Jeb Bush, who serves on an international working group on ethanol, this week predicted that a 54 cents per gallon U.S. tariff on Brazilian ethanol will soon be dropped, according to wire reports.

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