Brazil President’s Complaints in Germany and Now to Obama Are Not Making Her Friends

Dilma meets with Obama at White House Brazilian president Dilma Rousseff, at the meeting yesterday at the White House with president Barack Obama, once again – after having done the same when she met German chancellor Angela Merkel – complained that the use of monetary expansion, also known as quantitative easing, by the US and other rich nations as a tool to get them out of the Great Recession, was having a negative effect on the international economy.

Dilma pointed out that the easy money policies and near zero interest rates caused devaluation of currencies, especially the dollar, making economic development in emerging nations more difficult. In the past, Dilma called the flood of cheap dollars rushing into Brazil, where interest rates are much higher, a “monetary tsunami.”

Speaking at the White House yesterday, Dilma said: “We told president Obama of Brazil’s concern with this monetary expansion where countries with surpluses do not balance their currency expansion with fiscal policies based on the expansion of investments. These monetary policy decisions made by individual countries within the context of fiscal policies, result in currency devaluation in rich nations that compromise economic development in emerging nations.”

Obama responded that, in the medium term, economic growth in the United States was positive for the world economy even though in the short term it could be less so for the BRICS – the group of countries consisting of Brazil, Russia, India, China and South Africa.

“The BRICS represent an expressive part of the world economy, but it is important to perceive that world economic growth will be benefited by expressive growth in the US, … growth that will have an important role in overcoming the crisis and a return to prosperity,” declared Obama.

In other comments, Dilma emphasized the achievement of closer ties with the US in energy generation and, of great strategic importance to Brazil, the development of technology. Dilma added that partnership ventures in these areas will probably include gas and petroleum exploration in the future.

“We have existing areas of strategic cooperation, areas we can expand and deepen, such as energy. We have enormous room for cooperation in gas and petroleum that ranges from equipment and services to commercial relations. …We are partners, as well, in the area of biofuels. I want to acknowledge the recent reduction of trade barriers in the US that favor Brazilian [sugarcane-based] ethanol. And I want to put special emphasis on another huge area of cooperation, energy efficiency, something I know is very dear to president Obama.”

Finally, Dilma thanked the US for its participation in the Science Without Borders (Ciência sem Fronteiras) a program that aims to send 100,000 Brazilian students, professionals and researchers abroad on scholarships.

“We want to publicly thank the US for participating in Science Without Borders and accepting Brazilian students and researchers who will come here to set up partnerships with American universities. We welcome this support,” she declared.

MIT and Harvard

On her second and last day in the United States, president Dilma Rousseff will visit the city of Boston where she will speak at both Harvard (founded 1636) and MIT (founded 1865).

Both institutions, among the best universities in the world, are headed by women today . Drew Gilpin Faust at Harvard is that institution’s 28th president (first woman); she specializes in American Civil War and South history. Susan Hockfield, Ph.D. in neuroscience, is the 16th president of MIT, also its first woman president.

Dilma will make a speech at the Kennedy School of Government at Harvard and meet with Brazilian students there. She will also sign agreements with both Harvard and MIT that will make them part of Brazil’s new and ambitious scholarship program, Science Without Borders that aims to send 100,000 Brazilian scholars abroad for study and research between now and 2014.

Dilma will call for a frank and open exchange of experience between Brazilian researchers and their American counterparts and an increase in cooperation in the area of science with the US where around a fifth (20,000) of the Science Without Borders program scholars will be sent for studies and research in American universities and corporations.

In Boston, Dilma will have lunch with the governor, Deval Patrick. She also will participate in a roundtable discussion with members of the academic and scientific community at the University of Massachusetts and visit the innovation laboratory there.

Dilma will leave Boston tonight at around 11:00 pm and fly back to Brazil where she will arrive tomorrow morning.

Cachaça in the Menu

Although commercial relations between Brazil and the United States have had a tumultuous history and often wind up before dispute panels at the World Trade Organization, there is an interesting agreement that the two nations have worked out that will be made public during this week’s visit to the US by Dilma Rousseff.

The United States will recognize Cachaça, which is Brazil’s most popular alcoholic beverage, as “a distinct product of Brazil.” On the other hand, Brazil will recognize Tennessee Whisky and Bourbon as “distinct products of the United States.”

The “distinct product” label is a valuable commercial tool for exporters as it provides some protection from similar products from other countries. And it gives consumers, at least those consumers interested enough to want to know, important information about what they are buying.

Brazil produces some 1.5 billion liters of Cachaça annually (390 million gallons). Cachaça is always distilled directly from fresh sugarcane, whereas its beverage cousin, Rum, is made from molasses, which consists of concentrated sugar crystals extracted from sugarcane juice. As a result, much to the distaste of Brazilians, Cachaça is sometimes called Brazilian Rum.

Most Cachaça is brewed in small, artisanal stills in rural areas outside urban centers. Suffice it to say that there are 5,000 brands of Cachaça made in Brazil by 30,000 producers and as a result it is known by various names, such as “aguardente,” (literally, firewater) “caninha,” and “pinga.”

One of Cachaça’s characteristics is a high level of alcohol, usually above 35%, but which can vary widely according to the whim of the local producer.

Another piece of good news on the commercial front is that the longstanding, on again, off again, dispute over Brazilian orange juice access to the US market, after a WTO ruling that US trade barriers were inappropriate, has been resolved for the moment.

Dilma and Obama will also negotiate agreements on aviation and communications, pork (the US now imports pork from the state of Santa Catarina and Brazil seeks to have more states on the approved list) and certain provisions in the US Farm Bill that are seen as detrimental to Brazilian farm export interests.



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