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Why Bolsonaro’s announcement about US sugar quota for Brazil is not a diplomatic victory

Bolsonaro in 2019 photo; president celebrated on social media as it is actually temporary Image: Alan Santos / PR Disclosure
President went to social networks to celebrate a temporary and seasonal measure, which does not represent a change in the bilateral relationship of countries.

After a recent sequence of diplomatic defeats to the United States in bilateral trade, President Jair Bolsonaro went to Twitter on Monday, day 21, announced that Americans will increase the purchase of Brazilian sugar by 80 thousand tons, and together with a photo by Chancellor Ernesto Araújo, stated that this is “the first result of the recently opened Brazil-USA negotiations for the sugar and alcohol sector”.

The demonstration comes weeks after Brazilian steel has been cut in more than 80% of American imports and Brazil has renewed an exemption from tariffs on the entry of almost 200 million liters of American ethanol into the country, which the sugar and alcohol sector classified as “huge sacrifice”.

According to sources with direct knowledge of the negotiations heard by BBC News Brasil, the Foreign Ministry reportedly took steps to try to collaborate with the president’s reelection campaign Donald Trump, which has part of its electoral base among steel workers and corn farmers.

Officially, Chancellor Araújo stated that the concession was necessary to open negotiations that could result in a 140% reduction in tariff barriers that the Americans have imposed on Brazilian sugar for decades.

But the negotiations went down badly politically and generated criticism of the country’s subservience to its preferred ally. The tension still increased after Araújo served as a cicerone to US Secretary of State Mike Pompeo on a lightning visit to Roraima last Friday, when the American criticized the Venezuelan regime.

“In general, there is a perception that Brazil is not being treated fairly before the United States, so the government is trying to advertise something trivial and expected, to seek a balance in this image for its public” , an ambassador specialized in international trade privately told BBC News Brasil.

According to the diplomat, this is “trivial” and “expected” because although the president suggests that there was a permanent increase in the amount of sugar that Brazil could export to the Americans, what actually happened was a temporary relocation of suppliers made by the Americans.

The United States imports more than 3 million tons of sugar annually – and gives preference to sellers from Africa or Central America. But, if these usual suppliers do not sell the necessary quantity and there is an under-supply of the American market, the United States Department of Agriculture informs the country’s commercial representative who redirects its purchases to other producers, such as Brazil.

The same thing happened last year and in February of that year, without Bolsonaro making the event a cause for celebration on the networks on these two occasions.

“The United States did Brazil no favors, just reallocated some volume (of sugar) to Brazil, within their general mercantilism. This needs to be clarified, so that it does not look like a diplomatic victory that was not,” said Ambassador Paulo Roberto de Almeida.

pompeo - BRUNO MANCINELLE / IOM / POOL VIA REUTERS - BRUNO MANCINELLE / IOM / POOL VIA REUTERS
Pompeo’s visit to Roraima generated several criticisms in the political world Image: BRUNO MANCINELLE / IOM / POOL VIA REUTERS

But the current political moment may have led to this change in the president’s stance. Last weekend, the president of the Chamber of Deputies, Rodrigo Maia, criticized Pompeo’s visit to Roraima and accused his presence as a voter and an affront to the country’s autonomy.

“The visit of the US Secretary of State, Mike Pompeo, this Friday, to the facilities of Operation Welcomed, in Roraima, near the border with Venezuela, at a time when there is only 46 days before the American presidential election, it is not in line with good international diplomatic practice and defies the traditions of autonomy and pride in our foreign and defense policies, “said Maia.

His criticisms were endorsed in a letter by all the former chancellors of the democratic period: Fernando Henrique Cardoso (Itamar Franco government), Francisco Rezek (Collor government), Celso Lafer (Collor and FHC governments), Celso Amorim (Itamar Franco and Lula governments) , José Serra and Aloysio Nunes Ferreira (Temer government).

The political climate became so difficult that on Monday senators even considered postponing the hearing of more than 20 Brazilian candidates for ambassadors around the world, who await confirmation by the House of their posts. The boycott was demobilized after Ernesto Araújo agreed to appear in the Senate next Thursday to explain in detail Mike Pompeo’s visit.

sugar - GETTY IMAGES - GETTY IMAGES
Sugar bags for export in Rio Grande do Sul; producers denied that measure announced by Bolsonaro is a victory Image: GETTY IMAGES

The main stakeholders in Bolsonaro’s announcement, the sugar producers, did not consider the increase in quota to be a victory either. According to data from the Foreign Trade Chamber, in the last five harvests, Brazil has exported an average of 25.6 million tons of sugar in total. In this universe, the 80 thousand tons that the United States must buy now represent only 0.3%.

In a note, the Union of the Sugarcane Industry (UNICA) and the National Sugar and Energy Forum (FNS) stated that “this additional sugar quota is considerably lower than the monthly ethanol quota that Brazil again offered to the United States in September “and reaffirmed that the measure is not” an American concession “.

“We must clarify that this is a normal procedure adopted by the USA in recent years, without representing any structural advance for greater access for Brazilian sugar to that country”, say the producers in the note.

BBC News Brasil consulted the Itamaraty regarding negotiations with the Americans and the sugar quota, but did not receive a response until the publication of this report. Within the body, aides to the minister affirm that commercial relations along these lines are normal, but that it is difficult to understand these movements from a perspective “in which Brazilian concessions represent absolute submission from Brazil while any American measure is a ‘consolation prize'” .

Since assuming the presidency, Bolsonaro it made a profound change in Brazilian international politics, making the United States its preferred ally.

The trade expert ambassador privately heard by BBC News Brasil states that quotas and concessions are common in international relations, but that in polarized environments, where this type of transaction has attracted attention, it has led politicians to try to exploit them in their favor .

“In this case of sugar, there is nothing to be said about diplomatic victory, it is a circumstantial issue. Itamaraty and the productive sector know this. But the rest of the population, especially the supporters of the president, do not know. And they will be satisfied with his message, “he says.

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