Ambassador Ronaldo Costa Filho

Despite playing a minor role in the latest G20 summit, held in the Argentinian capital of Buenos Aires ten days ago, Brazil intends to be an active player in negotiations to demand reforms of the World Trade Organization (WTO). So says ambassador Ronaldo Costa Filho, the Deputy General Secretary of Economic and Financial Affairs at Brazil’s Foreign Ministry.

The call to revamp the multilateral institution was made during the summit’s final declaration and the road to reform is expected to be long, especially amid the trade war between the United States and China. Presidents Donald Trump and Xi Jinping announced a truce, and though it raises some hope for Mr. Costa Filho, caution and skepticism set the tone of his conversation with The Brazilian Report, especially when it comes to the mid and long-term consequences for Brazil.

How does the U.S.-China trade truce affect Brazil?
</h4> <blockquote><p><span style="font-weight: 400;">A trade war is always negative. Even if in a short-term there are </span><a href="https://brazilian.report/money/2018/06/20/brazil-us-china-trade-war/"><span style="font-weight: 400;">some benefits</span></a><span style="font-weight: 400;">, such as for soybean exporters. But in a global context, it raises more tension and uncertainty for the international trade system. Exporters may see some immediate gains but they will still face uncertainty in the medium term, which makes it hard for them to plan for the future. Steady rules allow companies and workers to set long-term strategies. But this is life. Nobody liked what happened, and yet we have to face it.</span></p> <p><span style="font-weight: 400;">The G20 summit has decreased tensions and given us some hope. But it was a very fragile movement. We have to wait and see what its outcomes will be. We must remember that the landmark of the summit was not only the meeting between [U.S. President] Donald Trump and [Chinese President] Xi Jinping. The </span><a href="http://templatelab.com/buenos-aires-leaders-declaration/"><span style="font-weight: 400;">Buenos Aires Declaration</span></a><span style="font-weight: 400;"> gave a clear sign of the need for changes to be made to the World Trade Organization (WTO). </span></p> <p><span style="font-weight: 400;">This is a reason for hope. The conflict has a bilateral aspect that affects the WTO but now some doors have been opened from a bilateral and a multilateral perspective. It was a movement that reduced tensions and set us on a track toward negotiating a solution. Naturally, the WTO [reform] process will be slow, because this is a multilateral organization. But there is no solution for the U.S.-China conflict that is not multilateral. </span></p></blockquote> <h4>How does Brazil intend to act in these negotiations? What is the country’s role to help them move forward?</h4> <blockquote><p><span style="font-weight: 400;">We will be active because Brazil’s dialogue with all of its partners at the WTO has always flowed easily. The U.S. demands are neither surprising nor unreasonable. They want to solve certain distortions and a lack of precision regarding some rules. Improving rules and systems is part of the WTO&#8217;s regular operations. Brazil knows that the organization’s agenda can’t meet the demands of one country or another. Our challenge is to make sure that all the members feel like they are gaining something.  </span></p></blockquote> <h4>What are the main issues Brazil’s intends to tackle in the changes to come?</h4> <blockquote><p><span style="font-weight: 400;">There are three, from the simplest to the most complex. The WTO must commit to its rules and obligations on transparency. The members must be clear about what they are doing, such as in the concession of subsidies for each country’s economy. There have been complaints about countries that delay mandatory notifications, subsequently preventing partners from knowing what is going on.</span></p> <p><span style="font-weight: 400;">Then comes the dispute settlement mechanism. All United States administrations—not only Donald Trump&#8217;s—have had issues with it for a long time. Brazil is ready to discuss and negotiate improvements to this system and its core concept must be preserved.</span></p> <p><span style="font-weight: 400;">The last issue to be tackled is the most problematic: we have to develop an agenda to update the rules of the WTO. It has to be something balanced to meet all the members’ concerns.   </span></p></blockquote> <h4>What kind of changes do you expect from the <a href="https://brazilian.report/money/2018/11/14/brazil-trade-china-commodities/">relationship with China</a>, mostly regarding the country’s investments in Brazil? Considering that Europe is more fragmented and the U.S. more protectionist…</h4> <blockquote><p><span style="font-weight: 400;">China has investments of USD 50 billion in Brazil. Our country is very open to productive funding. We have always been one of the primary destinations for foreign investments. Brazil has a large market that generates great outcomes for investors. And now we have a steady political and judicial scenario. These are attractive factors. </span></p></blockquote> <h4>Might president-elect Jair Bolsonaro’s clear intentions to its strengthen the alignment with the U.S. and his criticism towards China affect the relationship with the Chinese?</h4> <blockquote><p><span style="font-weight: 400;">It’s too early to say. There is a lot of speculation. Until the new administration takes office, we can’t say. But the transition cabinet has already shown signs that it will maintain responsible economic policies. Moreover, </span><a href="https://brazilian.report/opinion/2018/11/26/brazilian-government-privatization/"><span style="font-weight: 400;">plans for privatizations</span></a><span style="font-weight: 400;"> are also appealing for the Chinese, meaning they will be able to pour money into ports, airports, roads, and railways. They know there is a lot to be done in Brazil with regards to infrastructure. </span></p></blockquote> <h4>What is the current status of the <a href="https://brazilian.report/money/2018/09/16/eu-mercosur-trade-agreement/">free trade deal</a> between the European Union and Mercosur? It has stalled for the past 20 years…</h4> <blockquote><p><span style="font-weight: 400;">Mercosur is currently enjoying a rare period of alignment among its members, which are aiming to push for more integration. One of the main tasks at this point are the negotiations with the EU. </span></p> <p><span style="font-weight: 400;">But honestly, I don’t feel the same goodwill from the other side, especially when it comes to their protectionist approach to agriculture. [French President] Emmanuel Macron’s statements at the G20 summit were an example of this. [</span><i><span style="font-weight: 400;">Mr. Macron conditioned the EU-Mercosur deal to Brazil&#8217;s acceptance of the Paris Accords on climate change. President-elect Jair Bolsonaro has already forecast his intentions to pull Brazil out of the agreement</span></i><span style="font-weight: 400;">].  </span></p> <p>

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PowerDec 09, 2018

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BY Maria Martha Bruno

Maria Martha is a journalist with 14 years of experience in politics, arts, and breaking news. She has already collaborated with Al Jazeera, NBC, and CNN, among others. She has also worked as an international correspondent in Buenos Aires.