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Why is Israel's Shimon Peres in Brazil and Argentina? Iran.

For the first time in 40 years, an Israeli president is paying a state visit to Brazil. Israel President Shimon Peres began a week-long visit to Brazil and Argentina today. A key reason: Iran's growing influence in Latin America.

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But rumors that Iran was building a massive new embassy in Managua seemed to stand up as well as the tottering city has through a history of earthquakes. US Secretary of State Hillary Rodham Clinton said in May: “The Iranians are building a huge embassy in Managua.” But reporters scoured the city and just couldn’t find it. The Post concluded in July that the “mysterious, unseen giant embassy underscores how Iran's expansion into Latin America may be less substantive than some in Washington fear.”

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Similarly, a gold-domed mosque that sprung up in Managua in September – Nicaragua has an estimated 300 Muslims – prompted rumors that Iran was providing the dinero. But the treasurer for the body that oversees the mosque denied to the Wall Street Journal that Iran contributed a single córdoba to la mezquita. In fact, he says all they promised was a prayer rug – and it never came.

But Iran’s ideological and political agenda does have more traction in some parts of Latin America – especially with Venezuelan President Hugo Chávez – after Israel's incursion in Gaza. (Latin America’s Jews contend with rise in anti-Semitism: read more here.) Sabatini notes that Iran has a number of investments in Venezuela. There’s talk of opening an Iranian radio station in Bolivia. And Ahmadenijad has traveled to Latin America and met with Chávez several times.

“There’s very clearly [an Iranian] presence in the region,” Sabatini says.

But there’s also clearly pragmatic – not just geopolitical – reasons behind Peres's South America visit. He brought a delegation of 40 managers and business leaders with him, as he will sign a series of economic agreements with Brazil. Close ties with China have helped the Brazilian economy weather the global economic downturn. Brazil's GDP is expected to hit 3.5 percent next year.

Peres will also visit the Rio de Janeiro soccer stadium Maracanã ahead of Brazil’s hosting the 2014 World Cup and 2016 Olympics. The Israel Ministry of Foreign Affairs says the two events will offer opportunities for increased cooperation between Israel and Brazil in, among other things, the defense industry. That's a concern they each know well.

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