Great Big Neighbor

Back to his capital, La Paz, after a visit to Brazil went President Enrique Penaranda of Bolivia last week, his face wreathed in the most satisfied smile any Bolivian President has worn in years. In his pocket were trade agreements just concluded with his big neighbor to the east. The chief prize: Bolivian rights to use the Brazilian port of Santos as a free port, thus gaining an outlet to the Atlantic Ocean.

Further agreements:

> Brazil would appoint a commission to study the possibility of ceding to Bolivia a port on the Paraguay River, taking in exchange territory in another area;

> Brazil would establish a branch of her national bank at La Paz, and both countries would declare a mutual frontier area where both their currencies might circulate;

> Brazil would help Bolivia in the construction of rail-line connections to Santos (for which no rails will be available for some time).

Friendly Diplomacy. If not world-shakers the Bolivian-Brazilian agreements might prove a milestone in the history of South American relationships and power balances. Brazil's gesture brought her enhanced prestige, a significant indication of the leading role Brazil was gradually taking from her greatest rival, Argentina. Already Brazil has economic agreements with Uruguay and Paraguay, is heading toward another with Peru. Ultimate goal of the new Brazilian policy may be the welding of the Amazonian bloc: Bolivia, Ecuador, Colombia, Venezuela, Paraguay, Peru and the Guianas. If this succeeds, Argentina, already out of step politically in South America, may find that Brazil has assumed economic leadership of the continent.

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