Commentary

Six Things for Biden and Bolsonaro to Discuss on the Summit Sidelines

June 6, 2022

The Summit of the Americas may be on the way to resolving its attendance problem. Argentine president Alberto Fernández confirmed last week that he will attend and appears to be working with Mexico on a common approach to the summit. The decision to not invite Venezuelan interim president Juan Guaidó, regrettable though it may be, may address the concerns of Caribbean nations that had threatened to boycott the meeting over the Biden administration’s plan to bar Venezuela, Nicaragua, and Cuba. The most prominent holdout remains Mexican president Andrés Manuel López Obrador (AMLO), but there are efforts underway to address the concerns he has raised.

The Complicated U.S.-Brazil Relationship

At one point there was also the possibility of a no-show by Brazilian president Jair Bolsonaro. It is no secret that there is little warmth in the U.S.-Brazil relationship at the moment, but Brazil’s absence, combined with Mexico’s—two countries that together count for over half the region’s population—would likely have been seen as a serious blow to the summit’s ambitions for a hemispheric-level dialogue in Los Angeles.

Bolsonaro has now agreed to attend, having secured a bilateral meeting with President Joe Biden on the sidelines of the summit—the first encounter between the two leaders. Bolsonaro’s presence, in the context of U.S. concerns about the economic fallout from Russia’s invasion of Ukraine, China’s growing ties to the region, and slower progress globally on meeting climate change goals, would go some way to adding a deeper dimension to the ninth summit.

It would also be helpful for Biden to receive Bolsonaro for a genuine dialogue despite the polarizing statements made by his Brazilian counterpart in the wake of the November 2020 elections. There appears to be an acknowledgement in Brasília that there is a need to change course. Bolsonaro has said publicly that there has been a freeze in Brazil-U.S. relations since Biden’s 2021 election, with no virtual or in-person meeting and no acknowledgement at the G20 summit.

The fact is that it is critically important to continue working with Brazil—as the United States does with other complicated bilateral relations. The U.S. government in the past years had made accommodations with governments like Saudi Arabia, Turkey, and the United Arab Emirates and meets at heads-of-state level with the leaders of Russia (before the war in Ukraine), China, and other autocratic states. While Bolsonaro is also responsible for offensive rhetoric on a number of issues, the United States maintains close ties with countries where there are similar excesses, including Mexico and India. And Bolsonaro is the democratically elected leader of a vibrant and open society. It should be possible to pursue mature diplomacy between two large and strategic powers in both of the countries’ national interests. A conversation with Bolsonaro is long overdue, and it is time to turn the page on 2020.

Many analysts and policymakers in Washington believe and may hope that Bolsonaro will lose the next election, but the U.S. government should not be in the business of handicapping another country’s democratic choices. In the case of Brazil, the two countries’ mutual interests are sufficient to justify a meeting with Bolsonaro and position the United States to work with whatever government emerges after the October elections in Brazil. In any case, the assumption that U.S. ties with Brazil would ease should former president Luiz Inácio “Lula” da Silva return to power is dubious at best. Lula, for example, is highly sympathetic to the China, a country with a growing (and concerning) presence in Latin America, and has stressed a future partnership with China similar to the Russia-China alliance. Lula has also supported Latin America’s repressive dictatorships, defending Nicolás Maduro in Venezuela and Daniel Ortega in Nicaragua, even comparing the latter’s extensive period in office (due to outright fraud and active repression) to that of German chancellor Angela Merkel.

Irrespective of the outcome of Brazil’s upcoming presidential elections, the Biden administration should ensure the bilateral with Bolsonaro is a success. The press may ask tough questions about the rationale for meeting. Biden should respond in the same way as if he were hosting President AMLO or Prime Minister Modi: while the United States may have disagreements with its neighbors and partners, it hopes to speak openly and honestly with them, guided by the principles of mutual respect between parties that have important stakes in global issues that require ongoing dialogue.

Moving the Relationship Forward

In the interest of a productive bilateral meeting, here are six topics about which Bolsonaro and Biden can have a fruitful discussion.

Steel Quotas

The easiest, quickest win for restoring the Brazil-U.S. relationship would be for Biden to increase the Section 232 steel quota currently in place for Brazil to ensure that Brazil continues to have access to the U.S. market. Brazil is a significant manufacturer of steel with an industry deeply intertwined with that of the United States. Unfortunately, the Trump administration imposed a hard quota on the amount of steel that the United States can import from Brazil and a number of other countries. But unlike the quotas imposed for other countries, the quota imposed on Brazil is unduly restrictive and impedes Brazil's ability to better integrate with the economy of the United States. Imports from Brazil will not harm the U.S. steel industry as most imports (roughly 80 percent) are semi-finished products used as inputs for the U.S. steel industry or reexported as reprocessed products. With the stroke of a pen at the summit, Biden could announce an expansion of the quota for Brazil in recognition of the importance of the bilateral relationship where the United States enjoys a trade surplus. Brazil wants this, the United States stands to benefit, and this deal is achievable. Seeing that Bolsonaro is arguably helping Biden save the Summit of the Americas, an easy deliverable would be to increase the quota for Brazil in a fair and meaningful manner.

The Amazon

The Amazon is shared by nine countries, indicating that maintaining the rainforest will require multilateral cooperation. In Brazil, the Amazon is approached through both a security and sovereignty lens and an environmental one. The United States and Brazil have a difference of opinion on the Amazon, but there should be ways to find common ground. And it is Brazil where half of the Amazon basin is located, not the United States. Bolsonaro recently made requests for additional funding toward eliminating illegal deforestation, recommitting to his net-zero deforestation goal by 2030. Hopefully, Bolsonaro and Biden can agree on a leading Amazon policy that guarantees security, maintains economic value by committing to a modicum of development possibilities for the 25 million Brazilians who call the Amazon home, and keeps significant environmental policy in the mix.

Mining

Decarbonization doesn’t mean dematerialization. The world will still need to run on critical infrastructure and technology products derived from mining. Brazil’s considerable land area and vast quantities of mineral reserves give it strong geological potential. Notably, it has comparative advantages in iron ore, copper, and gold compared to other Organization for Economic Cooperation and Development (OECD) countries with similar mining industries. Brazil’s resources have taken on a global dimension in the wake of the geopolitical fault lines exposed by Russia’s invasion of Ukraine. The United States could share technology and make investments to ensure Brazil’s mining sector is more efficient and achieves its mineral yield potentials. Better partnerships with Brazil can make securing critical mineral access easier for the United States. There is a big opportunity for Brazil and the United States to strike a partnership that satisfies both interests, while considering environmental sustainability.

Agriculture and Fishing

Brazil is a major global agricultural exporter, leading in soybeans, corn, sugar, meat, and coffee. A combination of good macroeconomic policies and decades of scientific farming innovation helped it achieve its status as one of the world’s top agricultural exporters. Achieving agricultural sustainability is critical to global security and health, a concept that Brazil takes seriously, resulting in the creation of the Brazilian Agricultural Research Corporation (Embrapa). This research institute has aimed to adapt, create, and transfer technology to Brazilian farmers for sustainable agriculture since 1973. The United States could find a way to partner with Embrapa and Japan (a longtime Embrapa partner) to pursue better smart farming and digital agriculture practices. Russia’s war in Ukraine has induced food-price shocks, and Brazil is a key stakeholder in the discussion around managing global food prices for multiple crops.

Further, various countries in the region are dealing with illegal, unreported, and unregulated (IUU) fishing problems. IUU fishing erodes national security, threatens food sustainability and access, and undermines legitimate economies. As a potential major fish producer, discussing fishing regulations and sustainability with Brazil could put the United States back into fishing industry surveillance. Creating and maintaining these partnerships is critical to avoid a repeat of Argentina’s rejection of the U.S. Coast Guard Cutter vessel meant to provide security and surveillance of Chinese IUU fishing boats. Combating IUU in the Atlantic region can start with a strong Brazil-U.S. partnership.

Trade

Despite the reluctance of the last two U.S. administrations to engage in a sustained dialogue on trade and investment, this is one of the most pro-U.S. governments that Brazil has had since its return to democracy. Bolsonaro was eager to create better partnerships with the Trump administration and has demonstrated an interest in doing the same with the Biden administration.

Earlier in Biden’s administration, Bolsonaro wrote to Biden expressing an interest in creating a free trade agreement. A free trade agreement involving the two largest economies in the Western Hemisphere would be momentous and an opportunity to discuss a possible U.S.-Mercosur partnership, the Southern Cone’s trade bloc. At the same time, it could reduce Brazil’s reliance on Chinese partnerships and boost the pro-market environment Brazil wants. Lastly, any free trade deal would enshrine environmental and labor standards in Brazil, much as the United States-Mexico-Canada Agreement does, and urge Brazil to continue its push toward a more market-oriented economy. The latter will be important for Brazil’s bid to accede to the OECD.

Oil and Gas

Amid increasing oil and gas prices, Biden turned to Venezuela’s dilapidated and sanctioned oil industry to cut new deals, but Brazil is a better option as a top world exporter of oil with a yield of 3.7 million barrels per day. Indeed, Petrobras is one of the few state-owned oil companies in Latin America with a positive economic outlook. Additionally, Brazil's pre-salt deposits of oil and gas off its coast give it the potential to increase output by twofold, making it a critical energy partner. Discussing what opportunities there are for U.S. companies to invest in Brazilian oil exporters could establish better energy security for the United States and more opportunities for Brazilian oil exporters. Offering services such as designing more effective oil auctions is in Brazil’s economic interest and could make the United States a stronger oil partner. In the wake of Russia’s invasion of Ukraine and the U.S. ban on Russian oil and gas, oil imports from Latin America have surged. While Mexico, Colombia, and even Argentina have increased their exports to the United States, Brazil has not yet done so.

Conclusion

The United States needed Brazil to attend the summit and help make it a success. Given the state of Brazil-U.S. relations, it would not have been surprising if Bolsonaro had decided to skip the summit. Now that he is going, there is an opportunity to demonstrate that the United States really means what Secretary Blinken said in his May 3 speech about an approach to democracy in the Western Hemisphere that is “resisting the labels of left and right, liberal and conservative” and prioritizing shared fundamental principles.

“Lo cortes no quita lo valiente” is a Spanish expression that means being nice and polite does not mean one does not have to be truthful and honest. The United States should be truthful and honest with Brazil about the countries’ disagreements. At the same time, this is the most pro-U.S. Brazilian administration in the last 50 years. There is an open door to cooperation with Brazil and a chance to reaffirm the foundations for working with the next Brazilian president, whoever wins in October. The Biden administration should seize the opportunity.

Daniel F. Runde is senior vice president, director of the Project on Prosperity and Development and Americas Program, and holds the William A. Schreyer Chair in Global Analysis at the Center for Strategic and International Studies (CSIS) in Washington, D.C. Ryan C. Berg is senior fellow in the Americas Program and head of the Future of Venezuela Initiative at CSIS.

Commentary is produced by the Center for Strategic and International Studies (CSIS), a private, tax-exempt institution focusing on international public policy issues. Its research is nonpartisan and nonproprietary. CSIS does not take specific policy positions. Accordingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

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