In an address to 20 Latin American newspaper editors meeting in Atlanta in early February, Brazil’s Ambassador to the United States, Rubens Barbosa, called US moves in 2002 to broker bilateral deals within the Free Trade Area of the Americas agreement a “difficult point in the negotiations” that could slow the major trade agreement’s completion by 2005.
“Brazil has been always accused of dragging its feet, of being reluctant on the negotiations. I dare to say it’s not Brazil who is making difficult these negotiations,” Ambassador Barbosa told Central and South American editors and members of the US financial, academic and business community meeting in Atlanta. “We want to negotiate a real free-trade agreement, not a semi-free-trade agreement. We want to have fair trade. We want to have fair rules in the WTO, in the FTAA, rules that are not turned against us for protectionist reasons by companies or by governments.”
Latin America and FTAA were the subject of the day-long World Times International Inquiry “No More Messiahs? Latin America and the FTAA” held in cooperation with Delta Air Lines and cohosted by the Metro Atlanta Chamber of Commerce and the Southern Center for International Studies.
Brazil and the United States were selected as co-chairs during the two-year home stretch of the 34-nation FTAA negotiation process, which began in 1994 and is scheduled to be completed in 2005.
US Deputy Assistant Trade Representative Bennett Harman, speaking separately from prepared remarks during a morning panel, said prospects for the FTAA are “good — the FTAA is on track” and called the co-chairmanship between Brazil and the United States “a brilliant move. It ensures that there is a certain ownership of the process by the two major players. And we’re off to a great start in that cooperation.”
But co-piloting the negotiations doesn’t mean the United States and Brazil will agree on progress and terms. Currently the biggest sticking point for Brazil is the bilateral negotiations the United States began negotiating in 2002 on market access for goods. Mr. Harman said the United States is taking into account the size and the level of development of individual countries or groups of countries, from Central America to the Andean trading group. These bilateral agreements within FTAA have been coupled with reforms, investments, and changes in institutional structure to “enhance rule of law, investor certainty, and transparency of process and to reduce opportunities for corruption,” Mr. Harman said. “And I believe when you see indications, announcments in the US approach to the FTAA, the market-access offers, you’ll appreciate that we are being very proactive within the FTAA, very forthcoming.”
A US-Chile agreement awaiting ratification in the US Congress is of special concern to Brazil. The agreement would install fines for abrogating social and environmental clauses that could lead to trade sanctions if the fines are unpaid. “If you look at the US-Chile agreement, it gives you, I think, a sense, that the US is prepared to negotiate an ambitious and comprehensive trade agreement,” Mr. Harman said. “The US-Chile agreement we believe is going to set a high standard for the FTAA.”
But Ambassador Barbosa said a similar agreement would be unacceptable to Brazil and its partners in Mercosur — Argentina, Paraguay and Uruguay — which form Latin America’s largest trade bloc. “Mercosur is against this,” the ambassador said. “We have already said in public that if the benchmarks and precedents are included, Brazil will have a very difficult situation, because of the difference in the size of the country. Brazil is the second industrial country in the region after the United States. The diversity of the economy is second only to the United States, and we have many other interests in this whole exercise.”
Ambassador Barbosa said heavy US agricultural subsidies could also affect the outcome of the FTAA as well as negotiations at the World Trade Organization, which meets in Cancún in September. Brazil’s position on large US subsidies to farmers is being watched closely by developing nations. The outcome of subsidies negotiations at the WTO level could directly affect the FTAA. “If by Cancún no concrete progress has been achieved in these areas, then I think we won’t have a final [FTAA] negotiation by 2005,” Ambassador Barbosa said.
Mr. Harman said the solutions to the agricultural subsidies must be global. He affirmed that the United States is “working very proactively, very aggressively, building support within the hemisphere, finding common ground in confronting the true source of the problem on subsidies, which come from the likes of Europe and Japan. So we have an agenda, we have a way of approaching that difficult issue, and we are very willing to negotiate on it.”
February 15 marks another milestone in the FTAA timetable, when member countries offer proposals on specific products and sectors. Mr. Harman said the United States is on track to make its offers. “This is getting a little more real. It’s getting quite tangible. So, we’re on the home stretch, in that sense. We really only have 2003 and 2004 to conclude negotiations within the deadline set by the 34 presidents and heads of governments of all the participating countries in the hemisphere, except Cuba.”
But Ambassador Barbosa said Brazil would need more time to reflect on the question of investment, procurement and perhaps services. “We will need a few more weeks, and probably by the end of March we’ll present our proposal, our initial offer,” he said.
Both Ambassador Barbosa and Mr. Harman said in their separate remarks that the positions of the other’s country in the FTAA negotiations is understandable. “That’s to be expected,” Mr. Harman said, “and we welcome Brazil strongly defending its interests in the negotiations. We would expect them to. President Lula has been quite clear that he is committed to the FTAA. He wants to negotiate a good deal for Brazil.”
Ambassador Barbosa said disagreements over free-trade negotiations do not suggest a strain in US-Brazil relations. “After four years in Washington, one thing I learned is that, especially in South America, when countries do not agree with the United States, they are seen as against the United States. This is not the case. The fact that you don’t agree with the United States doesn’t imply that you are against the United States. We are working together. We want to work together. We want to have this free-trade area, but we have different positions, and this is normal.”
WORLD TIMES STAGES 25TH-ANNIVERSARY INTERNATIONAL INQUIRY
In cooperation with Delta Air Lines, World Times, Inc. invited the editors of 20 leading Latin American newspapers, from El Financiero in Costa Rica to Valor Economico in Brazil, to Atlanta to brainstorm regional challenges and discuss the Western Hemisphere free-trade agenda. The editors as well as 100 speakers and invited guests from Washington and Atlanta shared ideas about the free-trade negotiations and the economic, social and political future of Latin America in workshops and plenary sessions moderated by experts on Latin America, trade diplomacy and international economics.
Delta Air Lines provided transportation expertise and logistics for the attendees. The Southern Center for International Studies and the Metro Atlanta Chamber of Commerce co-hosted the meeting, which is further made possible by the support of several Atlanta-based corporations and organizations: Perishables Group International LLP, Summit National Bank, Swissôtel Buckhead, Frontera, the Atlanta Convention and Visitors Bureau and the Celia and Marcos Family Institute.
Based in Boston since 1978, World Times, Inc. regularly conducts International Inquiries to research facts, develop new thinking and create prospective reports to identify and clarify the dynamics of global trends. World Times brings together veteran journalists, academics, business leaders, scientists, government representatives and nongovernmental organizations from diverse backgrounds and geographies. Its research findings are published in The WorldPaper special editorial section on global issues in its Associate Publications around the world and made available to the public through white papers and conference proceedings.