[CTC] Stage Set for US-Brazil Trade Announcement

[Arthur Stamoulis]

If accurate, very fitting that they would formally announce their no-vote-for-Congress trade agreement in front of a corporate lobby group ...


Politico Morning Trade

— Brazilian President Jair Bolsonaro will headline a webinar today with U.S. Trade Representative Robert Lighthizer, piquing expectations the two sides will announce a mini trade deal on corruption and regulatory practices.

STAGE SET FOR U.S.-BRAZIL TRADE ANNOUNCEMENT:Bolsonaro headlines a U.S. Chamber of Commerce event today, raising expectations that the two sides will announce a mini deal covering trade facilitation, good regulatory practices and anti-corruption measures.

The expected agreement is far short of the comprehensive deals that Trump’s predecessors have negotiated with other countries in Latin America, including Chile, Colombia, Peru and a half dozen in Central America. 

Prelude to an FTA?: But the two-day Chamber virtual event is a prime opportunity for the two countries to announce plans for more comprehensive negotiations. 

Last year, Trump told reporters <https://go.politicoemail.com/?qs=f9f51537642445f60d0a76fb8a0dcc02802b3393f2aa8d335bcfefdb24ac30841e003f3c053b6afafb0d84ba98d5874e> that the U.S. was “going to work on a free trade agreement with Brazil.” However, Lighthizer never formally notified Congress of any intention to do that as is required by law for FTA talks to begin.

Lighthizer is scheduled to speak Tuesday at the Chamber event. A string of other U.S. and Brazilian officials, including Secretary of State Mike Pompeo, White House chief economic advisor Larry Kudlow and Brazilian Foreign Affairs Minister Ernesto Araújo, are also scheduled to speak over the next two days.

O’Brien to Brazil: Meanwhile, National Security Advisor Robert O’Brien is currently in Brazil leading a delegation <https://go.politicoemail.com/?qs=f9f51537642445f65913b42f1d7ec2da698510c94d4f118bbb82bb00d9ef1e8ab61e2574f30b58e2df15f5fbc69c5bd2> that includes officials from USTR, the U.S. International Development Finance Corporation and the U.S. Export-Import Bank.

Democratic opposition: On the other hand, House Ways and Means Democrats have warned the administration against pursuing any sort of agreement with Brazil.

“Through reprehensible rhetoric and actions, the Bolsonaro government in Brazil has demonstrated its complete disregard for basic human rights, the need to protect the Amazon rainforest, the rights and dignity of workers, and a record of anticompetitive economic practices,” the lawmakers said in a letter in June to Lighthizer. <https://go.politicoemail.com/?qs=f9f51537642445f62624664506cf0844331f1b085fd6854bfa7925c319c66ae083a3d58a13d2e02777a2c93b8b5dc1b2>
Don’t look for ag in Brazil mini deal: The U.S. and Brazil are big league agricultural exporters and rivals, making it a tough topic for both sides to negotiate. However, Brazil recently agreed to extend its duty-free quota for American ethanol for 90 days, getting the politically sensitive issue for Trump past the U.S. presidential election. 

Brazil is one of the biggest markets for ethanol, which is mostly made from corn in the United States and from sugarcane in Brazil. Bolsonaro is under pressure from Brazilian sugar producers to eliminate the American quota, which spared the U.S. industry from paying a 20 percent tariff on 198 million gallons of ethanol in the 2019-20 marketing year that ended on Aug. 31.

Elsewhere on the agricultural front: Bolsonaro’s government has been mulling whether to temporarily eliminate its tariffs on soybean and corn to curb domestic inflation. That was a topic among Brazilian officials again on Friday, a Reuters reporter tweeted. <https://go.politicoemail.com/?qs=f9f51537642445f6904d6f5c1862a8449373efb30abb5cec7f4a931eac2a0bbd2d6eb0ef287d8b34ef40e3addece0889>
Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826




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