Why this is important to Wisconsin businesses: The nascent trend is evident in a presidential decree and the comments of key ministers.
Brazil is prioritizing the liberalization of its service sector, an indication of the government’s desire to enter into negotiations on free trade agreements. A recent presidential decree called for Brazil to “pay special attention to strategic actions to promote the competitiveness of Brazilian companies in the global value chain, investment attraction, job creation and support for small to midsize companies.” Taken together, these developments indicate an interest in increased globalization on the part of Brazil’s government.
Concern for the competitiveness of Brazilian companies in global value chains, as well as investment attraction activities, are relatively new for Brazil, and their scope is being expanded to consider true integration in global production and exchange processes, beyond the immediate benefit to small businesses and job creation.
The currently small number of free trade agreements to which Brazil and MERCOSUR are party indicates the government’s prior narrow and anachronistic view of international trade. In the Doha Round of multilateral negotiations, Brazil and its partners were only involved in a single ambitious project: a free-trade proposal with the European Union, whose talks began in the 1990s and have yet to be concluded.
Brazilian Minister of Development, Industry and Trade Daniel Godinho has advocated for a revision of MERCOSUR’s goals and ambitions. Another indicator of the government’s shift away from protectionism is the recent nomination of José Serra, who supports broad changes to MERCOSUR’s policies and its inclusion in bilateral agreements, as minister of foreign affairs.