Diplomacia e Relações Internacionais

Antecipando um novo fracasso: free trade between USA and Mercosur: no kidding...

Como diria o Roberto Campos: o Brasil é um país que não perde a oportunidade de perder oportunidades, agora conjuntamente com os hermanos argentinos e bolivarianos. Vamos todos continuar soberanamente isolados das maiores correntes de comércio no hemisfério e no mundo...
Assim é, se lhe parece...
Paulo Roberto de Almeida

Romney Must Win Over Brazil to Deliver on Latin American Trade

By Brian Wingfield and Randall Woods

Bloomberg News, October 29, 2012

Oct. 29 (Bloomberg) -- Mitt Romney’s plan for a Latin

American trade region to enhance U.S. export prospects faces an

enduring problem: Two decades after President Bill Clinton

proposed a similar idea, the region’s biggest economies remain

as mistrustful as ever.

Establishing accords with South America’s largest economies

-- Brazil and Argentina -- would be difficult after leaders of

the two nations joined with Venezuala’s Hugo Chavez in 2005 to

sink the U.S. proposal to create a region-wide trade zone,

according to regional experts.

“We have trade agreements with the governments that want

to have trade agreements with us already,” Michael Shifter,

president of the Washington-based Inter-American Dialogue, said

in a phone interview from Managua, Nicaragua. “The ones we

don’t have trade agreements with are either not particularly

interested or they’re very small markets that wouldn’t make much

of a difference anyway.”

Romney, the Republican presidential nominee, has promoted

free trade as part of his job-creation plan. President Barack

Obama has stressed his administration’s enforcement of trade

rules, including cases involving China. While Obama, 51, last

year signed three trade deals that had been under consideration

since before his presidency, including ones with Colombia and

Panama, Romney, 65, has vowed greater focus on Latin America.

‘Huge Opportunity’

“The opportunities for us in Latin America we have just

not taken advantage of fully,” Romney said in the Oct. 22

presidential debate. “As a matter of fact, Latin America’s

economy is almost as big as the economy of China. We’re all

focused on China. Latin America is a huge opportunity.”

The combined gross domestic product for the Latin American

and Caribbean region in 2011 was about $5.8 trillion in current

U.S. dollars, according to the World Bank. China’s GDP was about

$7.3 trillion.

The Clinton administration in 1994 proposed the creation of

a 34-nation hemispheric trade zone known as the the Free Trade

Area of the Americas, or FTAA. The effort was abandoned in 2005

after Chavez led tens of thousands of protesters who burned an

effigy of President George W. Bush while he was attending a

regional summit in Argentina to discuss the proposed trade zone.

Chavez said the failed accord was an attempt by the U.S. to

“annex” Latin America.

Romney’s plan would seek to build upon free-trade deals the

U.S. already has in place, while creating a broader accord --the

Reagan Economic Zone -- open to any nation “willing to abide by

the rules,” according to a document posted on the Romney

campaign’s website.

Free Enterprise

“Governor Romney is committed to expanding America’s

trading relationships in the region by working to deliver on the

promise of signed agreements, by pursuing new agreements, and by

building a broader Reagan Economic Zone that strengthens ties

among nations committed to the principles of free enterprise,”

Amanda Henneberg, a campaign spokeswoman, said in an e-mail.

The reference to Ronald Reagan might face skepticism in the

region, where people often associate the former president with

U.S. support for the Contras in Nicaragua and the 1983 U.S.

invasion of Grenada, according to Shifter.

“Romney would have to establish trust, and probably

evoking Reagan doesn’t quite have the resonance in Latin America

that it has in the Tea Party,” he said, referring to the U.S.

political movement that has supported Republican candidates.

Connect Accords

As president, Romney would seek to “stitch up the

agreements we have” into a regional trade zone, former Commerce

Secretary Carlos Gutierrez, an adviser to the Republican

nominee’s campaign, said during an interview Aug. 21. Such an

effort would require nations in the region that have trade pacts

with the U.S. to reduce economic barriers among themselves, he

said.

The U.S. has in place free-trade agreements with 10 Latin

American and Caribbean nations: Chile, Colombia, Costa Rica, the

Dominican Republic, El Salvador, Guatemala, Honduras, Mexico,

Nicaragua and Peru. An 11th accord, with Panama, is scheduled to

take effect Oct. 31. Trade preferences in place for Ecuador are

set to expire in 2013, and U.S. relations with the nation have

been strained over issues including Ecuador’s ties with Iran and

Chavez.

It would be difficult to increase the number of trade

accords in Latin America because of probable opposition from

nations whose leaders can be hostile to the U.S., Rubens

Barbosa, Brazil’s ambassador to the U.S. from 1999 to 2004, said

in a phone interview from Sao Paulo.

Mercosur Bloc

A deal with the so-called Mercosur trade bloc, which

includes Brazil, Argentina and Venezuela, would also be a

challenge because the Latin Americans would insist the U.S.

reduce barriers on agricultural imports, said Barbosa, who

participated in the failed FTAA talks.

The U.S. filed a complaint against Argentina in August at

the Geneva-based World Trade Organization over restrictions on

imports from the U.S. Ten days later, Argentina fired back,

telling the WTO that American import restrictions on Argentine

meat weren’t justified.

The biggest missing element in trade policy with Latin

America is an accord between the U.S. and Brazil. The nation’s

$2.5 trillion economy is bigger than the combined size of the 11

regional nations that have free-trade pacts with the U.S.

“It’s just a big honkin’ economy,” Scott Miller, a senior

adviser for trade policy at the Center for Strategic and

International Studies in Washington, said in a phone interview.

“There’s a big commercial relationship to be had.”

Competitive Edge

A deal with Brazil could expand exports of high-tech

products and services in which the U.S. has a competitive edge

over China, which is also establishing a presence in the region,

Miller said.

China is the biggest export market for Brazil and Chile,

the world’s top copper producer, and second-largest for Peru,

Costa Rica and Cuba, according to an April report published by

the United Nations’ Economic Commission for Latin America and

the Caribbean, known as Eclac. China is on track to surpass the

European Union as Latin America’s second-biggest trading

partner, behind the U.S., it said.

“China is occupying space the U.S. has left vacant because

the U.S. decided to commercially neglect the region,” according

to Barbosa.

Brazilian Tension

U.S. economic relations with Brazil, its eighth-largest

trading partner last year, are at the moment tense. During the

last two months, the countries have sparred over Brazil’s

proposed tariff increases on industrial goods, U.S. monetary

policy and agricultural subsidies.

“I hardly think it’s possible to have a trade agreement

with Brazil because the thinking here is the U.S. cannot deliver

what we want: the opening of U.S. markets and reduction of

subsidies as well as other protectionist practices in the

agricultural area,” Barbosa said.

While a U.S. agreement with Brazil may not be in the

nations’ immediate future, trade policy experts say Romney could

still improve economic ties with the region.

“People complain that you can’t do a deal with Brazil so

you should give up on Latin America,” Eric Farnsworth, vice

president of the Council of the Americas, a New York-based

business organization, said said in a phone interview from his

Washington office. “That’s ridiculous.”

Integrating Accords

Integrating existing U.S. accords with Latin American

nations would provide uniformity to pacts that govern different

goods and standards, he said. The country could also seek to

expand a Pacific-region trade pact to include Colombia, Costa

Rica and Panama, according to Farnsworth.

The Latin America and Caribbean region is projected to grow

by 3.2 percent in 2012 and 3.9 percent in 2013, according to the

International Monetary Fund. The organization projects the

economy of Chile to expand by 5 percent this year and Peru’s to

grow at 6 percent.

“These are growth powerhouses and there’s no reason not to

tap into that,” said Miller, with the Center for Strategic and

International Studies. Linking existing trade accords would

integrate producers in the region, much as the North American

Free Trade Agreement has deepened the economic relationship

among Canada, Mexico and the U.S., he said.

The next U.S. administration will also need to deal with

growing trade tensions with Mexico, the nation’s third-largest

trading partner. The U.S. Commerce Department on Sept. 27 made a

preliminary decision to end a 16-year-old agreement that sets

prices of tomato imports. Mexican officials have said they are

willing to challenge the determination.

Mario Lopez Valdez, governor of the state of Sinaloa, a

large agricultural producer on Mexico’s western coast, said the

U.S. action is a violation of Nafta.

“If free-trade agreements are signed and then violated or

not respected, it makes no sense to be signing free-trade

agreements,” he said through a translator during an interview

in Washington.

For Related News and Information:

Top news about Latin America: TOP LAT <GO>

News about trade: NI TRD <GO>

News about the U.S. elections: ELECT <GO>

U.S. trade balance: USTB <GO>

--Editors: Jon Morgan, Daniel Enoch

To contact the reporters on this story:

Brian Wingfield in Washington at +1-202-654-7318 or

[email protected];

Randall Woods in Santiago at +56-2-487-4017 or

[email protected]

To contact the editors responsible for this story:

Jon Morgan at +1-202-654-7370 or

[email protected];

Joshua Goodman at +55-21-2125-2535 or

[email protected]

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