By John Lyons, Wall Street Journal
SAO PAULO, Brazil (Dow Jones)–U.S. President Barack Obama is set to meet with Brazil’s President Dilma Rousseff in Washington on Monday amid optimism for closer ties with South America’s rising economic power.
The issues in play reflect Brazil’s growing economic reach. Brazil’s biggest trade partner these days is China, not the U.S., and U.S. officials want Brazil as an ally in nudging China to let its currency rise. Brazil’s bigger economic presence in regional neighbors such as Venezuela, Ecuador and Cuba could allow Brazil to act as a moderating force in a region that has become more anti-U.S. in recent years.
Mostly, U.S. interests in Brazil are fueled by a growing consensus that the commodity-rich nation has put its history of periodic economic meltdowns behind it and will play a bigger role in world affairs as its economy grows. Brazil passed the U.K. as the world’s sixth-largest economy recently and is seeking a bigger voice in global forums such as the United Nations and the G-20 grouping of big economies.
Indeed, Rousseff’s U.S. trip comes a year after Obama traveled to Brasilia to meet her, a diplomatic overture that, observers say, underscored the Obama administration’s desire to hit the reset button on relations that became strained under Rousseff’s predecessor, Luiz Inacio Lula da Silva.
(This story and related background material will be available on The Wall Street Journal website, WSJ.com.)
Under da Silva, U.S. officials complained, Brazil’s attempts to flex growing economic weight on the global stage often created headaches for U.S. diplomats seeking to resolve regional and global issues. Brazil refused to recognize U.S.-backed elections to resolve a Honduran coup; Brazil opposed U.S.-backed sanctions to prevent Iran from acquiring a nuclear weapon.
Though Rousseff is da Silva’s protege and hails from his left-wing Workers Party, she introduced a more pragmatic foreign-policy agenda tuned to providing direct economic benefits to Brazil, rather than carving out a protagonist role for the nation in the Middle East and elsewhere. The result, observers say, may be fewer distractions as the countries tackle increasingly important economic issues.
Rousseff’s “priority is the domestic economy,” said Tovar Nunes, a senior Brazilian diplomat who acts as a foreign-policy spokesman, in a recent interview.
At their White House meeting, the leaders are expected to discuss a range of issues, from global economics to regional security and the environment.
The U.S. is likely to seek Brazil’s support on regional issues ahead of a summit of hemispheric leaders later this month in Colombia. Some analysts say Brazil will urge Obama to add star power to a major U.N. environmental conference planned for Rio de Janeiro this year. Obama hasn’t yet committed to attend.
All the same, the potential for tense moments remains. Rousseff is expected to criticize an expansive U.S. monetary policy that many in the emerging economies blame for creating imbalances such as overvalued currencies and asset bubbles. Rousseff made a similar complaint to Germany’s Angela Merkel last month. Europe, like the U.S., has interest rates near zero to spur growth.
Not much is expected to be accomplished on long-standing bilateral trade issues. Brazil wants to sell more of its beef, orange juice, steel and sugar to the U.S., but those politically sensitive industries are mostly protected by U.S. policies that are unlikely to budge. The U.S. wants more access to Brazil’s growing economy for manufactured goods, but Brazilian factory owners are already complaining of foreign competition and clamoring for more protections.
One chance for goodwill: The U.S. let its tariffs on ethanol, an important Brazilian industry, expire last year.
But other economic issues have become tricky. Vast new Brazilian oil finds mean the country may become an important source of regional crude as production in Mexico and Venezuela declines. But criminal charges and some $22 billion in lawsuits against Chevron Corp. following a deep-water oil leak last year raise questions about Brazil as an operating environment for U.S. firms.
Meantime, Boeing Co. is competing with manufacturers in France and Sweden for a contract to sell some $30 billion in fighter jets to the Brazilian military. A recent U.S. decision to cancel an order of Brazilian-made military training planes is a strike against the American effort in deeply nationalistic Brazil.
Rousseff’s economic focus may foster deeper ties in unexpected ways. Consider one program, called Science Without Borders, which provides scholarships for thousands of Brazilians a year at top U.S. graduate schools. The immediate goal is to make Brazil more productive. But such exchange programs also pay diplomatic dividends as top-educated Brazilians forge bonds in the U.S.
On Tuesday, Rousseff travels to Boston, where she will visit Massachusetts Institute of Technology and meet with Brazilian scholarship students already studying at Harvard University.
More than any single agreement, Rousseff may be seeking something that was a scarce commodity for the volatile nation in past decades: Respect. The country’s leaders have sought to be treated as a partner with the U.S. to be consulted on important regional issues since U.S. President Dwight Eisenhower visited Brazil in 1960. Brazil has sought a permanent seat on the U.N. Security Council essentially since the council came into existence.
Such demands used to draw mostly laughs. But that has begun to change amid Brazil’s economic growth. Obama is speeding up Brazilian travel-visa applications, in part because Brazilians are starting to outspend Europeans in key U.S. tourist destinations such as New York and Florida.
Dow Jones & Company, Inc.
By gCaptain Staff On April 8, 2012
- Brazil Files Criminal Charges (nalonmit.wordpress.com)
- Brazil Files Criminal Charges Against 17 Executives of Chevron and Transocean Over Oil Spill (the2012scenario.com)
- Follow the money: Brazilian president travels to Cuba and Haiti (csmonitor.com)
- Brazil announces credits of $600m for food, agriculture in Cuba (cbc.ca)
May 10, 2011 – 12:23 am EST
“Lula” and Barack Obama
Brazil’s immediate past president Luis Ignacio Lula da Silva, a former labor boss, built his Workers Party, an alliance of communists, Trotskyites, “liberation theologists”, black radicals, environmentalists and labor militants, into the most powerful political force in Latin America.
Working with Cuba, “Lula” as he is commonly known, has had an huge influence in the revolutionary wave that has swept Latin America since the early 90s.
Incidentally, this is around the same time that Barack Obama began his thirty year association with the organization.
Obama became involved with D.S.A. when he attended their Socialist Scholars Conferences in New York in the early 1980s. the connection may have gone back even into the late 1970s when he associated with members of Occidental College’s Democratic Socialist Alliance.
The Obama/D.S.A. relationship blossomed in Chicago and has never wavered since.
D.S.A. member Stanley Gacek is a labor attorney and A.F.L.-C.I.O. and was a long time International Affairs Assistant Director, responsible for the Federation’s relations with Latin America and the Caribbean. He has spoken and written extensively on Brazilian labor and politics and has been a friend and adviser to President Luis Ignacio Lula da Silva and the Workers Party since the early 1980s.
Since 1981, Gacek served as a special adviser on North American affairs to Lula’s Workers Party.
On April 17, 1993 D.S.A. hosted a reception in New York, for an “extremely distinguished delegation of “democratic socialist” leaders from Latin America”. The guests, all of whom would be running for president of their respective countries within the next year, included Ruben Zamora of El Salvador, Cuauhtemoc Cardenas of Mexico, Antonio Navarro Wolff of Colombia, and Luis Ignacio Lula da Silva of Brazil.
Sheinkman, Eisner and Lula
In 2008 Jose LaLuz was the chairman of Latinos for Obama , registering, educating and mobilizing Latino voters for D.S.A.’s presidential choice..
The International Award, was presented by Jan Schakowsky, a United States Representative (D-Illinois), one time D.S.A. member and key Obama supporter.
Barack and Jan
A Special Recognition Award went to Luis Ignacio Lula da Silva, President of Brazil-in absentia
It was presented by John Sweeney, President, A.F.L.-C.I.O. and a long time D.S.A. member.
Barack Obama, John Sweeney
In November 2010 Obama awarded John Sweeney the Presidential Medal of Freedom.
Socialist revolution is international in scope.
The same people who helped deliver Brazil to the socialists and communists, are working to do the same to the U.S.
This may help explain why Barack Obama lets Brazil drill for Gulf oil, but denies American companies the same right.
He is simply looking after his real friends.
Just weeks on he heels of President Obama’s visit to Rio De Janeiro during which he pledged to become Brazil’s best customer for its offshore oil and gas business, Brazil and Iran have taken steps for closer trade ties.
This is not a huge surprise, since the Brazilian oil giant, Petrobas, which counts Obama friend George Soros among its major shareholders, has doggedly refused to close its offices in Tehran, despite Iran’s support for terrorism and its nuclear enrichment program.
This sure makes one wonder why the US would pledge to so obsequiously support a nation with close economic ties to what is clearly an enemy of the United States. After all, Iran trained and armed the insurgents in Iraq and now trains and arms the Taliban in Afghanistan. Iran is the chief sponsor of Hezbollah, and also sponsors HAMAS and Al Qaeda.
More on the Iran-Brazil trade center from the Tehran Times…
The Iran-Brazil Friendship Association has announced that the Islamic Republic plans to open a trade center in the Brazilian capital Brasilia.
Director of the association, Mirqasem Mo’meni, told Fars News Agency on Saturday that the center would further promote trade cooperation between the two countries.
He added that considering the growing level of bilateral trade transactions, setting up the center would facilitate expanded trade between Iranian and Brazilian businessmen.
Mo’meni also stated that the project to set up the trade center will begin in late July.
In February, Brazilian Foreign Minister Antonio Patriota announced that Brazil will maintain its ties with Iran under new President Dilma Rousseff, continuing the cordial relationship expanded under former President Luiz Inacio Lula da Silva.
Iran and Brazil enjoyed close and friendly ties under President Lula, and Patriota noted that the new government would maintain the same level of ties with Iran, saying, “Rousseff will stay on the paths of her predecessor and mentor Lula da Silva.”
The International Monetary Fund announced in a report in December 2009 that Brazil is the largest trade partner of the Islamic Republic in Latin America.
April 16, 2011 6:24 am by Joe Leahy
The obvious answer is because he wanted to get in early to build a more constructive relationship between the US and Brazil than existed under Rousseff’s predecessor, Luiz Inácio Lula da Silva. In spite of his great charisma, Lula’s overtures to Iran irritated Washington and made him seem like an unreliable partner on the foreign stage.
But why the rush? Why not allow Rousseff to settle in and get a better measure of her administration before pinning the diplomatic flag of the US to the Palacio do Planalto, the president’s palace in Brasília?
The true answer might lie in the following passage from Obama’s remarks during a joint press statement with Rousseff after their meeting in mid-March.
“We’re creating a new strategic energy dialogue to make sure that the highest levels of our governments are working together to seize new opportunities. In particular, with the new oil finds off Brazil, President Rousseff has said that Brazil wants to be a major supplier of new stable sources of energy, and I’ve told her that the United States wants to be a major customer, which would be a win-win for both our countries.”
So it was about oil. Brazil’s “pre-salt” deepwater finds, which are just starting to come on stream. And not just any oil but the biggest offshore discoveries in history and all of it located in a stable democracy in the western hemisphere, not the Middle East. No wonder Obama could not wait to fly Air Force One in a southerly direction.
Fast forward to this week and Rousseff is visiting China. Among the corporate deals on the sidelines of the trip, a proposal by Foxconn, Taiwanese-owned electronics group with large operations in China, to invest $12bn in Brazil caught the headlines.
But perhaps more important in the long-run was the courting during the visit of Petrobras, the Brazilian oil major, by Chinese peer Sinopec. Petrobras already has a deal to supply oil to Sinopec from the pre-salt fields. But Sinopec went further this week by finalizing a joint venture with Petrobras to explore more blocks off the coast of northern Brazil, away from the “pre-salt” areas.
The US is realizing that strategic competition with China for scarce resources is no longer something it does far from home. Latin America, once the backyard of the US, is shaping up to become the stage for the next tussle between these two giants.
ACAPULCO, Mexico – Mexico and Brazil should form a strategic partnership in the oil sector, according to former Brazilian President Luiz Inacio Lula da Silva, who urged oil monopoly Petroleos Mexicanos and Petrobras to work together to ensure further growth and technological development.
“I dreamed that one day Petrobras and Pemex … might unite, perhaps to create another company to explore other markets around the world,” Lula said Friday at the close of the two-day Mexican Banking Association’s 74th annual conference.
He said this potential alliance should be discussed by the two governments with an eye to exploring for oil “in other regions around the world with more competitive markets and to becoming more competitive, more profitable and larger Latin American companies.”
“I hope that’s possible,” said Lula, who gave a speech at the conference titled “Global Challenges for Resolving the Global Financial Crisis: Brazil’s Experience.”
Lula recalled that Petrobras ceased to be a monopoly in 1997 and became a mixed company with 38 percent of its capital controlled by the state and the rest in private hands.
He recalled that the energy giant raised $70 billion last year in the biggest share sale in history and now is a powerful company whose market capitalization has climbed from $5 billion to $215 billion.
Lula noted that Petrobras is a modern company that has its own research center and makes use of cutting-edge deep-water drilling technology, adding that that is “not the result of luck, but of investment.”
Although Petrobras is a mixed-capital company, the government participates in the company’s decisions and makes sure the country’s strategic interests take precedence, Lula said.
While Petrobras in considered a world leader in deep-water drilling and has made massive ultra-deep finds in the Atlantic Ocean in recent years, Pemex’s output has stagnated due to aging fields and a lack of major new discoveries.
An energy overhaul in 2008 gives Pemex – nationalized in 1938 – more freedom to undertake projects with private firms, which are to be hired under incentive-based service contracts.
But the legislation excludes the provisions of President Felipe Calderon’s original initiative that would have allowed those companies a stake in the oil or any eventual profits.
Lula, a former Marxist who governed as a centrist from 2003 until the end of his term in Jan. 1, 2011, also noted that after no new refineries were constructed for 30 years Petrobras currently is building five.
He also said the company has become a self-sufficient natural gas producer and is working to develop alternative fuels.
Lula said the government must play an important role in the economy and cannot be afraid of private initiative, but instead but establish clear rules of the game for all sectors.
He called on Mexican bankers to arrange business meetings with Brazilian executives to form strategic alliances that lead to the creation of “strong and competitive” new companies.
After comparing the size of the both countries’ economies and bilateral trade flows, the former president said there is “something wrong in (bilateral) relations.”
Lula said it is disappointing that total bilateral trade amounts to just $7 billion annually and challenged the two countries to adopt a more daring trade policy.
He also urged Mexico, which is heavily reliant on trade with the United States, to look more to strengthening relations with South American nations.
Regarding the global financial crisis, Lula said it is still not over and that it is necessary for world leaders to remain vigilant.
He also said the G-20 group of major economies must take measures to prevent banks from falling into financial problems, strengthen government oversight and bar financial entities from lending money they don’t have.
( Original Article )