Brazilian University and think tank Fundação Getulio Vargas produces some interesting thought pieces in its monthly English-language magazine, the unimaginatively entitled “The Brazilian Economy”. Most recently, the magazine has been questioning how Brazil defines itself in Latin America and the world and argues that until Brazil consolidates its position in Latin America, it will gain little global traction.
Latin dominance looks far off. Instead, Brazil is focused on a sniping trade battle with Argentina, which has been fuelled in recent weeks by the latter’s president Cristina Kirchner and her peculiar brand of isolationism. Brazil’s own protectionism is sapping Mercosul and wider economic ties in the region. The article cites Ricardo Lagos Weber, former trade negotiator as saying: “it’s no secret to anyone that Brazil’s Foreign Ministry has never liked our policy of trade integration.”
As Mercosul dies on its feet with its main partners pursuing beggar-my-neighbour policies, other countries that have developed an economic model of openness are forging ever-stronger trade ties. Chile, Colombia and Peru are promoting a common FX and share platform and working on eliminating trade barriers, which they hope will give them more negotiating clout with Asia and the US.
The article points out that if Brazil wants to carve out a role for itself on the international stage, it will need first to assert itself in Latin America and define what it stands for. Instead, Brazil remains isolated in many areas on the continent. That leaves key foreign policy issues such as a permanent seat on the UN Security Council out of reach. David Cameron, prime minister of the UK, has lent his support but the US and some Latin countries, Argentina and Mexico in particular, remain reticent. Brazil needs to learn to run before it can fly.