On Monday, the Dialogue welcomed Rubens Barbosa, former Brazilian Ambassador to the United States and current head of the foreign trade council of São Paulo’s Federation of Industries (FIESP), to discuss the challenges Dilma faces as she prepares for a second term in office. Peter Hakim also joined the conversation to evaluate the prospects of a strengthened US-Brazilian bilateral relationship. The Dialogue’s Michael Shifter moderated the discussion.
To start off, Barbosa explained that the economy will be Dilma’s priority during her second term in office. There has been low growth combined with rising inflation, interest and unemployment rates, and Brazilians are demanding change. He pointed to the business community’s calls for greater Brazilian insertion into global trade negotiations. For Barbosa, this means deepening both Mercosur’s trade policies and Brazil’s bilateral relationships with its neighboring countries.
Barbosa also highlighted some of the challenges Brazil will face as it attempts to restore its regional leadership. He first pointed to Brazil’s Ministry of External Relations’ (Itamaraty) institutional crisis. According to Barbosa, Itamaraty’s budget cuts have significantly weakened the role of the Ministry’s diplomats, leaving them with only marginal influence on foreign policy. He considered the resulting lack of any clear Brazilian strategy towards BRICS to be a setback for Brazilian preeminence. Barbosa also discussed the current oil price war and the danger of plummeting oil prices negatively affecting Brazil in the long run.
With respect to Brazil-US relations, Barbosa stressed that even though the Snowden affair has paralyzed relations over the past year, exchanges between Brazilian and US high-level officials have endured. He explained that the US Department of Justice’s investigations into Petrobras will significantly shape the future of US-Brazilian reconciliation. Ultimately, he recommended that the government follow the roadmap Obama and Dilma had agreed upon during Obama’s state visit to Brazil in March 2011 to rebuild mutual trust.
Hakim discussed Dilma’s priorities and provided some additional insight into the future of US-Brazil relations. For him, the reason the economy is so overwhelmingly important when conjecturing about Dilma’s second term is because Dilma’s economic reforms will directly impact Brazilian trade relations and thus Brazilian foreign policy. Hakim also noted that despite the deteriorating economy, the outlook for Brazil remains positive. “Brazil just has to make itself attractive, and the investors will come running,” he explained. He also agreed with Barbosa that in addition to dealing with the Petrobras scandal, effectively navigating the aftermath of the Snowden affair will be central to both the US and Brazil in rebuilding confidence.
For both of our speakers, Dilma and Obama’s meeting on the sidelines of the G20 summit in Australia this upcoming week and talks of renewing state visits signal improving relations and cooperation between both Hemispheric powers. Even with these gestures, however, Barbosa and Hakim had reservations about the actual advances this dialogue would enable. Barbosa warned that it is “likely for there to be more rhetoric than concrete action” by either administration. Peter Hakim was also skeptical of any big change—for him, “the US-Brazil relationship has been largely a promise,” and will likely remain so.