Barack Obama was in Brazil last week to make friends with Dilma Rousseff. They apparently got off to a good start, even though he took time off from chatting with her to order the bombing of Libya, and her government was drafting a statement reiterating its opposition to this course of action even before she had waved him goodbye.
It is hoped the chumminess reported between these two heads of state of the two biggest nations in the Americas, will smoothen the relationship between their countries, a relationship made awkward both by recent history — Brazil’s independent approach to foreign policy has frequently led to disputes with the US — and the current economic crisis. President Rousseff said, “If we want to build a deeper relationship, we also need to deal frankly with our disagreements.” President Obama said, “We know how important it is to be able to work together — even when we often disagree.”
The US only recently conceded its position to China as Brazil’s main trading partner and single largest source of foreign direct investment. Despite the undervalued yuan commodity exports to China, in a period of rising commodity prices, were a major reason for Brazil’s ability to come out of the global economic crisis quickly. The US has tried, unsuccessfully, to make common cause with Brazil over Chinese currency controls, arguing that a properly valued yuan is necessary to fire up the US economy, which in turn is important for the world at large.
The value of Brazil’s real has escalated over 30 per cent against the dollar in the last two years. This has had a huge negative impact on the value of Brazilian exports to the US. Compounding this are US tariff and non-tariff barriers against Brazil's major exports like ethanol, beef, cotton, steel and orange juice.
President Rousseff illustrated what she meant by talking frankly about disagreements by making specific mention of this in her welcome address to President Obama in Brasilia. Referring to the Obama administration’s policy of quantitative easing that has kept interest rates low and the dollar weak she said, “…everyone knows that such large-scale measures provoke important changes in the relationship between the currencies of the whole world. This process erodes good economic practices and pushes countries into protectionist and defensive measures of all types.”
She was equally frank about Brazil’s concerns about the reform of international institutions that she said “still reflect an old world”. She said that although the process of reform of the World Bank and IMF was welcome, it was “too little too late”. She pointed out that it had taken a global economic crisis to shift the conservatism that governed these institutions. Reform of the UN, particularly the expansion the United Nations Security Council, she said, should not await a crisis.
The Brazil-US relationship, tricky at the best of times, was stuck in a rut because of the perception in Washington that Brazil’s former President Lula da Silva had “overreached” himself over Iran. Since the Brazilian Presidential election last October, The US foreign policy establishment has made much of the fact that although Dilma Rousseff was President Lula’s anointed heir she appears to have taken a different view from him on Iran and hence in her foreign policy stance.
In her first interview to the American press soon after her election, Ms Rousseff was asked her opinion on the case of a woman sentenced to death by stoning in Iran. She denounced it in no uncertain terms. This was read as a signal of a shift in foreign policy direction.
Mr Lula de Silva’s government celebrated its openness to Iran, consistently abstaining from voting against it in UN councils on subjects it deemed domestic issues; President Rousseff has emphasised her government’s unambiguous support for universal human rights. In an interview to a Brazilian business newspaper, published a couple of days before Barack Obama arrived in Brasilia, she said, “If one does not agree with the stoning of women, I cannot agree with people in prison for life without trial (as in the base at Guantanamo). What goes for Iran goes for the United States and goes for Brazil.”
Brazil under President Lula da Silva stressed, closer regional ties, multilateralism, cooperation in the global south and challenged US agendas in robust and often provocative ways. This combined with its growing economic clout established Brazil as a regional power and an independent voice in world affairs. This has been unsettling both for the US and the curiously craven Brazilian elite.
Ms Rousseff's style is rather more low key, but she is as unlikely to concede the space that her predecessor carved out for Brazil on the international stage. She does not shy away of saying that Brazil, today expects serious attention from the US. For what other country in the world, she has said, “(has) the oil reserves we have, that has no war, no ethnic conflict, respects contracts, has very clear democratic principles and a vision of the world that is generous and pro-peace?”
President Obama acknowledged this in his speech at the Presidential Palace in Brasilia. He was in Brazil, he said, because he wanted “deeper cooperation with 21st century centres of influence, including Brazil”. Beyond this, it was all warm fuzziness. He declared Brazil and the US “equal partners”. But, this equality did not extend to an endorsement of Brazil’s right to permanent membership of the UN Security Council. It did not extend to the lowering of tariff barriers against Brazil's major exports, or to the suggestion that this might happen in the foreseeable future.
Thus it has always been with Brazil and the US. But things may begin to change. Brazil's growing relationship with China has certainly piqued US interest. Next fortnight President Rousseff will be in China on her first state visit outside South America and for the BRICSs heads of government meeting. The US will certainly be watching.
