The Brazilian president, Jair Bolsonaro, made an official visit (the first international visit of his mandate) to the USA, from 17 to 19 March 2019.
During the trip he met the American president Donald Trump, with whom he had a very cordial conversation and in which he reiterated his desire to approximate Brazil even more to the USA.
Of the Presidential party have made part, among the others, the Minister of Economy, Paulo Guedes, the Minister of Justice, Sergio Moro, the Minister of Foreign Affairs, Ernesto Araújo, the Minister of Agriculture, Tereza Cristina and the Minister for Science and Technology, Marcos Pontes.
In summary, here are the main results of Bolsonaro’s journey:
- Entry of Brazil into the OECD
Bolsonaro has asked for US support for Brazil’s entry into the OECD (Organization for Economic Development Cooperation). In return, Trump has set as a condition that Brazil renounces the advantages given by the WTO (World Trade Organization). The main advantage of being part of this “club of the rich” is to obtain a mark of credibility that (in theory) would facilitate the entry of international investments. To achieve this, Brazil should follow the economic policy rules imposed by the OECD (which require an open economy and a less interventionist state), a fact that would certainly have a significant political impact for the Bolsonaro government’s liberal policy. On the other hand, giving up the current privileges granted by the WTO to Brazil as a developing country could jeopardize important trade agreements, especially in the industrial and agricultural sectors. Upon returning to Brazil, a senior Brazilian official declared, taking a radical backtrack, that Brazil could renounce the advantages offered by the WTO if China and South Korea were also to do so.
- Trade agreements in agriculture
An important agreement concerns the elimination of tariffs on the importation of US wheat and pork by Brazil. In return, the implementation of new health inspections to allow the export of Brazilian beef to the USA.
According to the agreement, the US will be able to export up to 750 thousand tons of wheat without having to pay the current 10% tariff.
However, the grain agreement can create serious problems in relations with Argentina, for which Brazil is the main importer of wheat grown on its territory.
- US use of the Alcantara aerospace base
Brazil will allow the US to use the base located in the state of Maranhão for the launch of space satellites. The Alcantara base, due to its privileged position near the equator line, allows a saving of around 30% on the fuel needed for launching surface-to-space missiles.
This is a commercial agreement, for which Brazil will receive an economic counterpart, a sort of rent for the use of the launch base. There is talk of a few hundred million dollars a year, in addition to a significant transfer of technology.
The agreement, to enter into force, must be ratified by the Brazilian Parliament.
- Accession of Brazil to NATO
Trump wants the current NATO (North Atlantic Treaty Organization) to extend to the Southern Hemisphere, involving a strategic partner like Brazil. At first, Brazil would have the status of an external ally, and then become (possibly) a new member. The possible entry into NATO would create many concerns for its weight on the state budget, given that member countries must mandatorily allocate at least 2% of GDP to the Armed Forces (and Trump would like it to become 4%).
- Visa abolition for entry into Brazil
With the aim of increasing the flow of tourists and facilitating business travel, Brazil has abolished the need for entry visas for citizens of the USA, Japan, Canada and Australia. The decision is not the result of Bolsonaro’s journey, but its announcement was made to coincide with the presence of the president in the USA to give it greater prominence.
Contrary to the policy adopted so far by Brazil, the concession does not provide reciprocity: that is, Brazilian citizens traveling to these countries will continue to require the issuance of a visa.
- Venezuelan crisis
Both Trump and Bolsonaro have avoided talking about a possible military intervention in Venezuela, but both defend Maduro’s departure from the scene.
Trump reiterated that “all options are open” and praised the support of the Bolsonaro government to Juan Guaidò, self-proclaimed interim president of Venezuela.
Regarding the support for a possible US military intervention, Bolsonaro refused to answer, attaching the secrecy and strategic nature of this information.
Worthy of note, in parallel with the official agenda, was the positive meeting of Paulo Guedes with representatives of the US economic and business world, to which he confirmed the government’s commitment to approve the reforms and to implement the vast planned privatization plan.
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