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Tuesday, December 6, 2011

Brazil-U.S. Relations

Peter J. Meyer
Analyst in Latin American Affairs

As its economy has grown to be the seventh largest in the world, Brazil has consolidated its power in South America, extended its influence to the broader region, and become increasingly prominent on the world stage. The Obama Administration’s national security strategy regards Brazil as an emerging center of influence, whose leadership it welcomes “to pursue progress on bilateral, hemispheric, and global issues.” In recent years, U.S.-Brazil relations have generally been positive despite Brazil’s prioritization of strengthening relations with neighboring countries and expanding ties with nontraditional partners in the “developing South.” Although some disagreements have emerged, Brazil and the United States continue to engage on a number of issues, including counternarcotics, counterterrorism, energy security, trade, human rights, and the environment.

Dilma Rousseff of the ruling center-left Workers’ Party was inaugurated to a four-year presidential term on January 1, 2011. She is Brazil’s first female president. Rousseff inherits a country that has benefited from what many analysts consider 16 years of stable and capable governance under Presidents Cardoso (1995-2002) and Lula (2003-2010). She has pledged to build on her predecessors’ accomplishments by maintaining strong economic growth and fostering greater social inclusion. Rousseff’s 10-party electoral coalition holds significant majorities in both houses of Brazil’s legislature; however, keeping the unwieldy coalition together to advance her policy agenda has already proven challenging. Although her Administration has had to deal with a number of corruption scandals, Rousseff remains popular among the general population. In September 2011, 71% of Brazilians approved of her performance in office.

With a gross national income (GNI) of $1.83 trillion, Brazil is the largest economy in Latin America. Over the past eight years, the country has enjoyed average annual growth of over 4%. This growth has been driven by a boom in international demand for its commodity exports and the increased purchasing power of Brazil’s fast-growing middle class. The country has also benefitted from a series of policy reforms implemented over the course of two decades that reduced inflation, established stability, and fostered growth. These policies have enabled Brazil to better absorb international shocks like the recent global financial crisis, from which Brazil emerged relatively unscathed. After strong growth in 2010, however, the Brazilian economy has begun to slow. While the country has the resources necessary to weather another potential downturn in the global economy in the near-term, several constraints on mid- and long-term economic growth remain.

The 112th Congress has maintained interest in U.S.-Brazil relations. Several pieces of legislation have been introduced, including bills that would suspend foreign assistance to Brazil (H.R. 2246) and the issuance of visas to Brazilian nationals (H.R. 2556) until the country amends its constitution to allow for the extradition of its citizens, and bills (H.R. 3039 and S. 1653) designed to accelerate visa processing for citizens of Brazil and other countries. Additionally, the House initially adopted a provision (H.Amdt. 454), which was dropped from the final legislation (H.R. 2112), that would have prevented the United States from providing payments to the Brazil Cotton Institute as it agreed to do to temporarily resolve a World Trade Organization dispute with Brazil.

This report analyzes Brazil’s political, economic, and social conditions, and how those conditions affect its role in the world and its relationship with the United States.

Date of Report: November 22, 2011
Number of Pages: 35
Order Number: RL33456
Price: $29.95

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