US Secretary of Commerce Wilbur Ross’s agenda in Brazil this week will be split between the agenda with the Brazilian government and meetings with the business community. In both groups, one issue will come up: the possibility of negotiating a free trade agreement with Brazil. At the first stop in Sao Paulo, Ross will be confronted by the businessmen’s call for progress in a “gradual” negotiation.
The deal is listed first among the proposals that Amcham (American Chamber of Commerce) intends to deliver to Ross in the “Brazil-US: 10 Proposals for a More Ambitious Partnership” document. But the bet of entrepreneurs is a realistic advance with discussions on topics that do not involve tariffs and therefore do not need to be combined across Mercosur. Negotiating without discussing tariff issues is also a way of opening doors with the Donald Trump government, which in the last two years has already withdrawn or renegotiated free trade agreements such as the TPP and NAFTA.
“Any free trade negotiation is a medium and long term exercise. We have examples of success as the agreement with Chile, which dealt with numerous issues minus the issue of tariffs. This was a very important and inspiring step for that we can do the same thing with the US,” says Deborah Vieitas, president of Amcham, in an interview with the state. Amcham estimates that a free trade agreement with the US would contribute to an increase of up to 1.3% of the country’s GDP by 2030.
Ideally, she says, they would begin negotiating measures to reduce bureaucracy, cost and time in bilateral trade. “Anyway, these are measures that would be part of the case of signing a free trade agreement. It means moving in where it is less sensitive, smoothing the ground for a next step,” she says.
Ross will attend Amcham’s 100-year event, which represents more than 5,000 Brazilian and American companies. The secretary’s trip is considered a natural step after President Jair Bolsonaro’s visit to Donald Trump in March when countries agreed to lower trade and investment barriers – what was called the “partnership for prosperity” in the joint statement.
Among the other nine items on the list of proposals that the business community will present to Ross, two are considered to be easy to implement in the short term: an agreement to avoid double taxation and Brazil’s participation in the Global Entry program to facilitate business entry into the US. In the case of the “pre-approved” entry program, IRS and Federal Police must agree to exchange data with the US.
The list of entrepreneurs also includes the continued support of Americans for Brazil’s entry into the OECD and the advance of a bilateral agenda in mechanisms such as the CEO forum of the two countries, which was reactivated this year. Other points in the document are trade facilitation, such as mutual recognition of exporters to expedite processing. The Brazilian government hoped that it would be possible to advance mutual recognition, which should facilitate customs operations, in time for Bolsonaro’s visit to Washington in March, but was frustrated.
Amcham also calls for regulatory cooperation to bring the two countries closer together and convert the accelerated patent analysis pilot project into a permanent agreement.
The good humor between the two governments, in the evaluation of Amcham’s president, can produce concrete results. “The signals we have received and the interest we have seen makes us believe that this time we do have the opportunity to do differently. Negotiating a trade agreement itself can begin in the short term. The success of the Mercosur-European Union agreement can be called stimulating point for this discussion. The coming of the secretary is a demonstration that we can move forward on this project to improve and broaden the relationship with the US,” says Deborah.
Ross will have meetings with the ministers of economy, Paulo Guedes, and of Infrastructure, Tarcísio de Freitas.