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What would a “Brazil First” policy mean for Argentina?
Sarah Nielsen . Dec 17, 2018
This article was originally published in Issue #5 of The Essential. To view the full edition,
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The rise of Jair Bolsonaro set Argentina on edge. Upon winning Brazil’s presidential elections, the ex-Army captain and current President-elect seemed set on eroding traditional Argentine-Brazilian relations. His pick for Economy Minister Paulo Guedes called the Mercosur trading bloc “not a priority.” Mr. Bolsonaro himself broke long-standing diplomatic protocol, scheduling his first presidential visit to Chile rather than Argentina.
With forecasted contractions of 2.8 percent in 2018 and 1.9 percent in 2019, Southern Cone realignment is the last thing the Mauricio Macri administration needs. Brazil is Argentina’s number one business partner and a major regional influence. Moves by the so-called “Tropical Trump” to pursue a “Brazil First” model would result in severe repercussions across the border.
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<p>In 2017, Brazil <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=fa31948b15&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3Dfa31948b15%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNHP96S0yizkt-qZScDlIlWcJFB8DQ">accounted</a> for 27 percent of all imports to Argentina (USD 17.87 billion) and 16 percent of all Argentine exports (USD 9.31 billion). The two countries primarily trade cars and automobile parts, which <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=a7c5a3231f&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3Da7c5a3231f%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNGR1Ql_htJg_lDyXTWJVCLwWrERvw">represented</a> roughly 30 percent of imports from Brazil to Argentina and 34 percent of Argentine exports to Brazil in 2016 according to <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=5ee8460173&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D5ee8460173%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNGFoouk7ZarnVbsynfcc9nPp0wsow">MIT</a>.</p>
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<p><img class="alignnone size-large wp-image-12755" src="https://brazilian.report/wp-content/uploads/2018/12/export-LENw2-999x1024.png" alt="brazil trade argentina" width="999" height="1024" srcset="https://brazilian.report/wp-content/uploads/2018/12/export-LENw2-999x1024.png 999w, https://brazilian.report/wp-content/uploads/2018/12/export-LENw2-293x300.png 293w, https://brazilian.report/wp-content/uploads/2018/12/export-LENw2-768x787.png 768w, https://brazilian.report/wp-content/uploads/2018/12/export-LENw2-610x625.png 610w, https://brazilian.report/wp-content/uploads/2018/12/export-LENw2.png 1200w" sizes="(max-width: 999px) 100vw, 999px" /></p>
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<p>Brazil and Argentina often compete – not just on the football pitch – for regional power within Latin America. Since his election in 2015, President Mauricio Macri has set out to establish Argentina as a regional powerhouse. One USD 57 billion IMF deal later, things aren’t going so well.</p>
<p>Mr. Bolsonaro has stepped in to fill the void. Mr. Guedes has called Mercosur “<a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=7bb6c10bb8&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D7bb6c10bb8%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNHy3uFxbttq70Ioyqk5G0w-dYgSpQ">ideological</a>,” and the President-elect himself has deemed the bloc “<a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=abb344df03&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3Dabb344df03%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNEP65cyj7rkDJt1OnyfJ4x7w1TXCw">distorted</a>” by the Workers’ Party of former presidents Dilma Rousseff and Lula da Silva. According to future Agriculture Minister Tereza Cristina, Mr. Bolsonaro is set to take on reforming the <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=0eccc0228e&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D0eccc0228e%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNEuEZyaQ368lTOp-LUavz3fiHLZ0w">$2.8 billion</a> trade bloc as soon as he takes office on <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=8ed79333de&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D8ed79333de%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNHUBU6KwkMJ0bOrnAUaeb2LhXwPeg">January 1.</a> Ms. Cristina has announced intentions to revise Mercosur’s Common External Tariffs, currently set at up to 35 percent.</p>
<p>This sets off worries for all other Mercosur member countries (Argentina, Uruguay, and Paraguay; Venezuela was <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=84ca219c6c&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D84ca219c6c%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNH_jkjQNe7zUA5nJ6Qsvhxy9J1JNg">suspended</a> in 2017 and Bolivia is not yet a full member), who would have to compete with exports from non-member countries. While Mercosur has never seen great progress in inter-member trade, recent trends waxed optimistic. 2017 saw a 13.8 percent <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=43604f3d0e&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D43604f3d0e%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNGO5I0Lvvnz-_MACCaZ4INqKhXwPA">increase in exports</a> (the first increase in five years) and a 16.4 percent increase in trade between member countries.</p>
<p>Brazil’s <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=5b7a5220c1&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D5b7a5220c1%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNFx8231gRdwGyiowRqtaYBvcac_mg">questionable</a> adherence to the Paris Agreement also dampens hopes for an EU-Mercosur agreement any time soon. Speaking with Mr. Macri in mid-November, Mr. Bolsonaro <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=6fd25e8f1b&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D6fd25e8f1b%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNFZdKuznknm_KsCOdK91qeV0ARVgg">reportedly</a> expressed interest in progressing with the deal. On the eve of the G20, however, French President Emmanuel Macron <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=880d98e69a&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D880d98e69a%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNFPWXgpgY_UX6hR8v05t86pJDviRg">stated</a> he would be unwilling to sign trade deals with “countries that do not respect the Paris Agreement.”</p>
<h2>Succumbing to far-right nationalism</h2>
<p>Argentina’s closest Bolsonaro-like personality would be Congressman Alfredo Olmedo (<em>Salta Somos Todos</em>). Christened the “Argentine Trump,” the eccentric Salta congressman touts a conservative Christian background and has even called for building a wall between Argentina and Bolivia. In classic Bolsonaro style, Olmedo has <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=68a5850dd0&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D68a5850dd0%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNFARZnqeHAF4Idmc_etxftR8T0ffA">commented</a> that Argentina’s history of military dictatorship had “two sectors: the military and the terrorists. The two should be judged equally.” Olmedo has not publicly commented on a presidential run.</p>
<p>Mr. Olmedo is a long-shot. According to Dr. Juan Gabriel Tokatlian, a professor of international relations at Universidad Torcuato Di Tella in Buenos Aires, wrote in <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=bc1e09f28b&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3Dbc1e09f28b%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNHnvGL5EqQCBjOklQlWeUqbsMcuFQ">La Nacion</a> that such a platform has little hope in Argentina. For Tokatlian, “this country is infertile land for a Bolsonaro.”</p>
<p>Citing the institutional crisis of Dilma Rousseff’s impeachment and the collapse of the party system in Brazil, Dr. Tokatlian finds no such comparison in Argentina. He adds that Brazil’s crime rates are far higher than those of Argentina, and Argentine military officials do not have the same clout as their Brazilian counterparts.</p>
<p><span style="background-color: #f5f6f5;">Dr. </span>Tokatlian also highlights the different values in Brazilian and Argentine societies. According to a World Value Survey from 2010-2014, 24.1 percent of Argentines consider religion to be very important while 51.5 percent of Brazilians believe the same. The rise of the evangelicals in Brazil greatly impacted that of the rise of Mr. Bolsonaro. In Argentina, evangelicals do not carry the same weight. The Catholic Church still reigns as the strongest religious influence in Argentine politics.</p>
<p>The survey continues, showing that opinions of the Armed Forces vary drastically between the two countries. 28.8 percent of Argentines expresses confidence in the military compared to Brazil’s 58.6 percent. In regards to a military government, 32.1 percent of Brazilians stated they would approve, and only 9.9 percent of Argentines would do the same.</p>
<p>Indeed, in Argentina, the militarization of the democracy is consistently met with concern. When Mr. Macri announced his intention to restructure the armed forces in late July 2018, Argentines winced. Attempts to normalize militarization clash with raw memories of the military junta. As in the 1988’s <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=64f0c0674e&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D64f0c0674e%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNGUNU7WHlCSdR5OIIswcYzYgHJ9UA">Law 23.554</a> and 2006’s <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=3d407fbe46&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3D3d407fbe46%26e%3D2b1475d9f8&source=gmail&ust=1544883489336000&usg=AFQjCNF-AHS7Ww0UzxPeI7IO55aBV2sEcA">Decree 727</a>, Argentina has consistently placed civil control over the military.</p>
<p>Brazil, on the other hand, has seen repeated use of the armed forces for domestic security over the past decade. In 2018 alone, President Michel Temer issued two separate decrees of federal military intervention: Rio de Janeiro state in February and Roraima state in <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=e87091d271&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3De87091d271%26e%3D2b1475d9f8&source=gmail&ust=1544883489337000&usg=AFQjCNFMj2UJi5hTYPcmu4pWvlov9gbf-A">December.</a></p>
<h2>Macri and Bolsonaro</h2>
<p>Mr. Macri and Mr. Bolsonaro have spoken over the phone on at least two or three occasions, according to Foreign Minister Jorge Faurie. “It is important that the countries that make up Mercosur open up to economic insertion within larger economic spaces or with large economies,” <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=bc651f59e9&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3Dbc651f59e9%26e%3D2b1475d9f8&source=gmail&ust=1544883489337000&usg=AFQjCNGYbhWvYS8VTC31p9yVCl5ZgymJiw">said Faurie</a> at a cabinet meeting in early December. “That requires liberalization of this space that remains very closed.”</p>
<p>However, President Mauricio Macri will not be attending Mr. Bolsonaro’s inauguration on January 1st. A source close to the president told <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=b0330f254f&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3Db0330f254f%26e%3D2b1475d9f8&source=gmail&ust=1544883489337000&usg=AFQjCNHoV4IEW39D0WvI_5PzaDYwtSAv1g">La Nacion</a> Mr. Macri will be on holidays and will not travel. This comes a week after Faurie spoke on the issue, saying, “For us, Brazil is our most important business partner, our regional neighbor. This determines that the President understands he will be present, as will other leaders.”</p>
<p>President Michel Temer had <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=e7df9441a4&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3De7df9441a4%26e%3D2b1475d9f8&source=gmail&ust=1544883489337000&usg=AFQjCNHSf8STuljyGJlL7fqAf9DPVcLtZw">extended an invitation</a> to Mr. Bolsonaro to attend the G20 with him in Buenos Aires. Mr. Bolsonaro <a href="https://thebubble.us9.list-manage.com/track/click?u=6a633c644c826f3c9f397d796&id=c34890bf6f&e=2b1475d9f8" rel="noopener" data-saferedirecturl="https://www.google.com/url?q=https://thebubble.us9.list-manage.com/track/click?u%3D6a633c644c826f3c9f397d796%26id%3Dc34890bf6f%26e%3D2b1475d9f8&source=gmail&ust=1544883489337000&usg=AFQjCNE9TBgcA9DwtLCnprBOZrfYL1vDWQ">declined</a>, citing health concerns stemming from a knife attack in September 2018.</p>
<p>With foreign ministers from both countries set to meet at January’s Lima Group meeting next month, Argentina and Brazil may yet find room for dialogue. Peruvian Foreign Minister Nestor Popolizio has recommended using the meeting to sever ties with Venezuela, and both Argentina and Brazil now agree. Easy convergence on the issue may provide precious common ground.
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