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FTAA: …And Brazil Was Left Alone


FTAA: ...And Brazil Was Left Alone

The U.S. was incensed at Brazil in Port of Spain. Brasília proposed

that Americans and
Canadians wouldn’t have a tariff reduction in the
FTAA. On the other hand, Latin American countries saw this as a

Brazilian maneuver to take advantage of poorer countries while
hurting their chances of having access to the
U.S. and Canada.

by:

Francesco Neves

 

What a difference a few weeks make. One month ago, Brazil led a rebellion against the United States and the
European Union in Cancun. At that time, Brazilian Foreign Minister, Celso Amorim, was one of the rare people to find a positive
spin for the diplomatic and trade disaster. Cancun had not produced an agreement, he conceded, but it had forged a new
coalition of developing countries. And Brazil was proud of its feat, leading new-found allies as powerful as China and India.
Brazil seemed an emerging power that from now on had to be respected and heard.

The Port of Spain (capital city of Trinidad and Tobago) meeting, last week, however, convened to advance talks on
the adoption of the Free Trade Area of the Americas (FTAA), ended up in a standoff and Brazil came out as the big loser.
Brazilians wanted once again to transform the discussion into a confrontation between Brasília and Washington. It didn’t work.
Even the Brazilian partners from Mercosur (Argentina, Paraguay and Uruguay) abandoned ship together with Venezuela’s
left-leaning President Hugo Chavez, who was supposed to be President Lula’s good friend and unconditional ally.

To the surprise of many, Uruguay presented its proposal separated from that of Brazil and Argentina stressed that
it considered itself a country that "can do." It was a direct response to U.S. Trade Representative Robert Zoellick, who
declared on September 14: "Whether developed or developing, there were `can do’ and `won’t do’ countries here (in Cancun).
The rhetoric of the `won’t do’ overwhelmed the concerted efforts of the `can do’. `Won’t do’ led to impasse."

Brazil’s proposal in Port of Spain to limit the scope of the treaty which will create the FTAA was rejected by the
majority of the participating countries. The Brazilian effort to torpedo the U.S. was looked with suspicion by other Latin
American countries. They accuse the Lula administration of not understanding their needs just because Brazilians believe that
there will be no FTAA without Brazil’s participation.

The Brazilian isolation in the conference was conveyed to Itamaraty, Brazil’s Foreign Ministry, by the country’s
trade delegation. The Brazilian government had given precise instructions to its envoys to fight for a reduced FTAA.
According to official sources in Brasília, the Brazilian delegation had been instructed to convince its partners in the Mercosur to
eliminate from the Port of Prince talks the topics governmental purchases, investments and services. These subjects were to
be dealt only at the World Trade Organization (WTO).

According to senior U.S. negotiator for the FTAA, Ross Wilson, a great number of countries led by Costa Rica
presented a document in Port of Spain expressing their interest in a wide and ambitious agreement, negotiated in multilateral bases
and as a single undertaking. Costa Rica was joined by Canada, Mexico, Chile (they already have a free trade agreement with
the U.S.) Nicaragua, Honduras, Guatemala, El Salvador (together with Costa Rica, they are in the process of signing a
similar accord) plus Panama, Peru, Bolivia, Dominican Republic and Colombia, all interested in bilateral negotiations with
Washington. Colombia went as far as to announce that it was abandoning the G-22.

The US was incensed by the Brazilian proposal that established that Americans and Canadians wouldn’t have a
tariff reduction, which would be the privilege of the poorer countries for the trade between them with the exclusion of U.S.
and Canada. The Latin American countries didn’t like this idea either. They saw this as a Brazilian maneuver to benefit from
the poorer countries while hurting their chances of having access to those two rich markets.

Brazil vs. USA

Brazil and the U.S. are at each other’s throats again. The two countries now seem very far from an agreement that
would create by January 1st, 2005, the world’s largest free-trade zone, comprising 34 countries from the three Americas, from
Canada to Argentina, and teaming up 800 million people.

Trade ministers will have another chance to break the impasse in Miami, when they meet there in November, but the
prospects are not encouraging.

`’After eight years of sweeping garbage under the carpet, we are at the moment of truth,” said Adhemar G.
Bahadian, Brazilian trade negotiator.

Bahadian is co-chairing the FTAA negotiations with Peter Allgeir, U.S. Deputy Trade Representative. Despite
statements by U.S. officials that Brazil had isolated itself, Bahadian continued to paint the meeting in positive colors saying that the
talks had allowed participants "to take an X-ray of the agreement."

Said American Wilson: `’What was disappointing was Brazil’s unwillingness to engage in the substantive issues.
There is a very large group that wants an ambitious and comprehensive agenda. It sort of highlighted that the vision that Brazil
is pursuing does not have significant support in this group.”

Sources at the Brazilian Foreign Ministry explained that Brazil adopted its position of "apparent intransigence" in
response to the U.S., which made it clear from the start that they would not be open to discuss agricultural issues. "The
United States pushed agricultural and antidumping negotiations to the WTO. FTAA without discussion about agricultural
market is unacceptable. If they limit the negotiation, we’ll do the same."

For Brazilian Agriculture Minister, Roberto Rodrigues, the United States has no interest in implementing a Free
Trade Area of the Americas. Talking in Florianópolis Santa Catarina, on Saturday, Rodrigues lambasted the US, blaming that
country for the impasse. "They are always talking about an all-encompassing FTAA agreement," he said, "but they are unable to
negotiate key issues such as agriculture."

Bahadian and Allgeier have a meeting scheduled for October 13 and 14 in Washington where they should among
other things produce a ministerial draft resolution to be presented in Miami. It’s doubtful that such a meeting in a lower level
of government will be enough to solve the impasse between Brazil and the U.S.

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