Brazil is embroiled in a political crisis that has temporarily removed President Dilma Rousseff from office amid an already painful economic recession. But U.S. businesses hope the future will be brighter for the Latin American powerhouse given interim President Michel Temer’s pronouncements on domestic reforms and trade.
“We commend the proposals addressed in ‘The Bridge to the Future,’ and support implementation of this ambitious program,” U.S. Chamber of Commerce President Tom Donohue said of Temer’s plans in a letter delivered to the interim president Wednesday. The program aims to boost the Brazilian economy through increases in private investment, pension reforms and cuts to public spending.
“It is also our belief that the path to spur sustained economic growth stems from increasing trade initiatives, securing investment in infrastructure, and improving ease of doing business in Brazil,” Donohue added before requesting a meeting with Temer.
Brazil’s new leader seems considerably more open to trade liberalization than Rousseff, Chamber Executive Vice President Myron Brilliant told POLITICO. “His signal from day one is that Brazil has to change, and that part of this change has to be to want to foster trade relations,” he said.
Brilliant and Cassia Carvalho, president of the U.S.-Brazil Business Council, highlighted the importance of Brasilia’s turn in that direction in light of the country’s economic woes, which have led investors to head elsewhere in the short term.
Don’t hold your breath for a U.S.-Brazil free trade agreement anytime soon, but the notion isn’t as far-fetched as it was even a few years ago. That’s because Brazilian businesses are increasingly on the same page about wanting to negotiate new trade deals, Brilliant said.
The Chamber executive pointed to a study released last week by the National Confederation of Industry Brazil (CNI) that he said advocates tweaking the rules of the Mercosur economic bloc to allow Brasilia to negotiate bilaterally with the United States and other countries.
“What we have seen over the last few years is a change in views within the Brazilian business community,” Brilliant said, citing the country’s move away from being a commodities-only economy. Their support for free trade agreements “should not be taken lightly,” he said, adding that “years ago it would’ve been difficult because the industry would’ve been divided.”
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