Good morning! The international pressure on Brazil following the rise of Amazon fires. Brazil to leave peacekeeping task force in Lebanon. Will the AT&T merger with Time Warner pass in Brazil? (This newsletter is for platinum subscribers only. Become one now!)


Bolsonaro v. the world

Yesterday, French President

Emmanuel Macron called the spike in Amazon fires an &#8220;international crisis,&#8221; asking for the subject to be at the center of discussions when the G7 meets this weekend. He was seconded by Canadian Prime Minister Justin Trudeau, and several world leaders and celebrities (who are capable of giving visibility to the matter). On Twitter, calls for boycotts to Brazilian products began gaining momentum—and worrying Brazilian agricultural producers.</p> <p><strong>Why it matters.</strong> France has already made it clear that it won&#8217;t easily support the ratification of the Mercosur-EU trade deal, and environmental issues appear to be the red line set by Mr. Macron. Even if U.S. President Donald Trump is a climate change denier and a friend of Mr. Bolsonaro&#8217;s, actions from Europe could severely harm Brazil&#8217;s agribusiness—and could cost the president an important support base.</p> <p><strong>Protests.</strong> Demonstrations against the Brazilian government have been scheduled for today in at least eight Brazilian cities and six international capitals.</p> <p><strong>Actions.</strong> After international backlash, Mr. Bolsonaro decided to create a &#8220;crisis cabinet&#8221; to deal with environmental issues—its first meeting will take place today. Still, the government believes that most of the criticism is unwarranted and part of an international agenda to diminish Brazil&#8217;s sovereignty in the Amazon region. Congressman Eduardo Bolsonaro, the president&#8217;s son, shared a video on social media in which Mr. Macron is called an &#8220;idiot.&#8221;</p> <p><strong>Risk?</strong> The 73rd episode of the Explaining Brazil podcast talks about what could happen should international superpowers decide to intervene in environmental matters. Guest: Harvard professor Stephen Walt.</p> <script src="https://www.buzzsprout.com/299876/1548880-73-is-brazil-capable-of-protecting-the-amazon-on-its-own.js?player=small" type="text/javascript" charset="utf-8"></script> <hr class="wp-block-separator"/> <h2>Brazil should abandon Lebanon peace force</h2> <p>The Brazilian government has reportedly decided to no longer command the maritime task force of the United Nations Interim Force in Lebanon, a position the country had held since 2011. Budget cuts were a key factor—but people close to the task force leaders say President Bolsonaro&#8217;s decision to list Hezbollah as a terrorist organization made dialogue more difficult. The group is an important political party in Lebanon and part of the Lebanese coalition government.</p> <p><strong>Why it matters.</strong> Over the past decade, Brazil lost most of its influence on the global stage, with a decreasing diplomacy budget, successive political and economic crises—and now the negative repercussions of its lax environmental policy. Being part of (and leading) peacekeeping missions is a way of showing the global community Brazil wants to have a bigger stake in global affairs. As Brazil&#8217;s Armed Forces say, it&#8217;s about &#8220;projecting power.&#8221;</p> <p><strong>Israel.</strong> Another factor that makes Brazil&#8217;s presence in Lebanon unwanted is Mr. Bolsonaro&#8217;s proximity to Israeli Prime Minister Benjamin Netanyahu. Before 2019, Brazil was seen as an important mediator due to its historical neutrality on the Israel-Palestine conflict.&nbsp;</p> <hr class="wp-block-separator"/> <h2>Will the AT&amp;T -Time Warner deal go through in Brazil?</h2> <p>Brazil&#8217;s telecommunications regulator Anatel has postponed its decision on the AT&amp;T -Time Warner <a href="https://edition.cnn.com/2019/02/26/media/att-time-warner-merger-ruling/index.html">merger</a>. A decision is expected to be made early in September. Current legislation forbids companies from owning simultaneous majority stakes in content producers and broadcasters. AT&amp;T controls the Sky broadcasting group in Brazil, whereas Time Warner owns channels such as HBO, CNN, and Cartoon Network, among others.</p> <p><strong>Why it matters. </strong>Congressman Eduardo Bolsonaro is lobbying hard to get the deal approved. As a matter of fact, the deal wasn&#8217;t even supposed to be debated by Anatel yesterday—it was included on the agenda after Mr. Bolsonaro paid a visit to the regulatory agency. He is reportedly following a personal request from U.S. President Donald Trump.</p> <p><strong>What experts say.</strong> Anatel&#8217;s technical area has positioned itself against the deal—saying it is a clear violation of Brazil&#8217;s current legislation. The case&#8217;s rapporteur (who met with Mr. Bolsonaro this week) said that the deal could go through, as Warner Media is not based in Brazil. Meanwhile, there are at least five bills in Congress which aim at lifting barriers on vertical consolidation by telecommunications companies.</p> <hr class="wp-block-separator"/> <h2>What else you need to know today.</h2> <p><strong>Polls.</strong> Three years early, weekly magazine <em>Veja</em> published the first set of polls for the 2022 election. It shows Jair Bolsonaro, with 35% of voting intentions, way ahead of the competition. It also shows Justice Minister Sergio Moro as a strong candidate, with 27% of voting intentions (in a scenario that doesn&#8217;t include the president). While it is awfully early to predict the 2022 race, the poll shows that Mr. Bolsonaro&#8217;s controversial persona has been able to keep supporters galvanized.</p> <p><strong>Pension reform. </strong>Senator Tasso Jereissati, the pension reform&#8217;s rapporteur in the upper house, was expected to present his report today at the Constitution and Justice Committee. However, he has asked for more time. That could delay the entire timetable by a few days at least. Mr. Jereissati didn&#8217;t say when exactly he will present the report.</p> <p><strong>Who&#8217;s the boss?</strong> The crisis within the Federal Police shows how much Justice Minister Sergio Moro has lost prestige. After promising to give full autonomy to the Federal Police, President Bolsonaro is strong-arming his cabinet minister by attempting to personally appoint the next head of the force in Rio de Janeiro—saying that the Federal Police boss could also be sacked should he resist the interference. &#8220;If I [fire him] today, what would be the problem? The law says <em>I</em> appoint him, not Sergio Moro. Period.&#8221;</p> <p><strong>Currency.</strong> No other currency in the emerging world lost as much value against the U.S. Dollar yesterday than the Brazilian Real. During the morning, the BRL had a timid rise, thanks to the Central Bank&#8217;s auction of USD on the spot market, but the trend was quickly reversed. The USD closed the day at BRL 4.078 (+1.19%). Meanwhile, the São Paulo stock market index was also down, by 1.18%.</p> <p><strong>Biofuels.</strong> Brazil&#8217;s corn ethanol production should reach 1.35bn liters in the 2019–2020 harvest, per estimates of the National Supply Company (Conab). If confirmed, that will represent a 70% bump from the previous harvest. Meanwhile, sugarcane ethanol production, while still elevated, should go down 6%—to around 30bn liters.

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BY Gustavo Ribeiro

An award-winning journalist with experience covering Brazilian politics and international affairs. His work has been featured across Brazilian and French media outlets.