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U.S. & Brazil Sign New Protocol on Trade Rules and Transparency

Posted October 21, 2020

At a two-day U.S. Chamber of Commerce event held in Washington earlier this week, the United States and Brazil signed a new protocol consisting of three “ambitious” agreements they said would expand and deepen the 2011 Agreement on Trade and Economic Cooperation between the two countries.
US and Brazil Flags
The new measures when taken together “demonstrate the countries’ mutual commitment to the fundamental elements necessary for a fair shake on trade,” according to a joint statement.

U.S. Trade Representative Robert Lighthizer said that the protocol “uses the existing ATEC to establish common standards for the two countries on efficient customs procedures, transparent regulatory development, and robust anti-corruption policies that will create a strong foundation for closer economic ties between our two countries.”

The full text of the U.S.-Brazil ATEC Protocol on Trade Rules and Transparency can be found here.


Prelude to a US-Brazil FTA?

Although falling short of the comprehensive deals negotiated by prior administrations with other countries in Latin America, including Chile, Colombia, Peru and a half dozen in Central America, the protocol is being officially touted as setting the stage for discussions about working out a free trade agreement in the near future.

Last year, Trump told reporters that given his “ fantastic relationship” with President Jair Bolsonaro, the administration was “going to work on a free trade agreement with Brazil,” but USTR Lighthizer never provided the required notification to Congress in this regard.

“They charge us a lot of tariffs, but other than that we love the relationship,” Trump remarked at the time when asked about the future of bilateral trade with Brazil. 


Political Opposition

The Brazilian government was apparently eager to get the protocol signed before the U.S. election on November 3, which is casting uncertainty on future relations in the event of a victory for Trump’s Democratic challenger, Joe Biden. “Under a potential Joe Biden presidency, trade deals with Brazil will face more hurdles,” according to a recent briefing by the consultancy Eurasia Group.

The updated agreement met with sharp opposition from Democrats who warned the administration against pursuing any sort of comprehensive trade deal with Brazil. “Through reprehensible rhetoric and actions, the Bolsonaro government in Brazil has demonstrated its complete disregard for basic human rights, the need to protect the Amazon rainforest, the rights and dignity of workers, and a record of anticompetitive economic practices,” the lawmakers said in a letter in June to Lighthizer.

Trade Subcommittee Chair Earl Blumenauer, D-Ore., pointed with concern to the White House’s recent track-record of negotiating “mini agreements” on trade with other countries absent congressional approval, saying this “may force a rebalancing” of the trade authority powers Congress has delegated to the executive branch.


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