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Brazil President Rousseff returns from China with expansive trade deals, US falling further behind

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+For specifics on the deals signed between Brazil and China, see Brazilian President Signs 20 Trade Deals on First Trip to China on The Epoch Times+

Raymond Colitt, Reuters, April 20, 2011

China has put its relations with Latin America’s largest economy back on track by sending Brazilian President Dilma Rousseff home with billions of dollars in pledged investments, showing its economic clout and easing, for now, Brazil’s concerns over trade imbalances.

The Asian giant’s showering of business deals on Rousseff contrasts sharply with last month’s trip to Brazil by U.S. President Barack Obama, who offered much praise for Brazil’s rising economy but few concrete agreements.

Rousseff had gone to China with complaints from Brazilian manufacturers ringing in her ears about a wave of cheap imports that have decimated some Brazilian export sectors even as China became Brazil’s largest direct investor last year.

Those complaints have received a more favorable hearing since Rousseff was sworn in on January 1 as her government has sought a more balanced relationship with the country that is now its biggest trade partner and has long been the main buyer of Brazil’s huge farm and mining output.

Thorny currency and trade issues were largely left untouched in Beijing. They will continue to dog ties, but Brazilian officials say Rousseff advanced her main objective — to diversify trade and investment ties beyond raw materials to include more value-added goods.

She avoided bringing up the touchy issue of China’s currency in public, but secured a host of business deals that signaled Chinese sensitivity to Brazilian concerns over their lopsided relationship.

“The agenda with China looks much more promising than that with the United States,” said Andre Nassar, head of Icone, a Sao Paulo-based trade think tank.

Obama’s visit to Brazil last month was partly aimed at taking advantage of Rousseff’s more critical stance toward China, whose growing influence in Brazil and Latin America has eroded traditional U.S. economic dominance in the region.

Obama’s concrete pledges were slim though, especially compared with China, which last year invested about $17 billion in Brazil in areas from oil to manufacturing.

Rousseff, a career bureaucrat who has adopted a more pragmatic foreign policy than her predecessor, returned from China with billions of dollars of investment pledges in areas ranging from research and development to food processing.
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Written by peripheralrevision

04/20/2011 at 5:52 pm

Posted in Brazil, China

BRICS: A world that doesn’t have to ask for America’s permission…

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it is they who are “on the side of history.” They do not have to ask America’s permission to lead … and how America and our old allies react to that reality will go a long way to determining just how the geopolitics of the next several decades will play out.

David Rothkopf, Foreign Policy, April 14, 2011

While NATO bickers over strategy in Libya, BRIC leaders have gathered in Sanya, China, to demonstrate the growing strength of an alternative grouping that has among its principle selling points the fact that it is neither Western nor U.S.-dominated. To compare the world’s most potent and enduring military alliance with a loose affiliation of emerging powers that are divided by perhaps more issues than unite them is clearly comparing apples and lychee nuts or guarana seeds, but the juxtaposition of the two events does offer yet another whiff of how the institutions and ideas of the 20th century are giving way to those of the 21st.

In Libya, the potent alliance that “won” the Cold War is coming apart at the seams fighting over strategy, tactics, and objectives in an optional, low-grade intervention in a largely irrelevant country. The U.S. secretary of state is forced to make public pleas for the bumptious commanders of the coalition to get their acts together, while on the ground the weakened forces of the isolated Muammar al-Qaddafi seem to be holding the megapower onslaught at bay. It is too poignant a reminder that intangibles like knowing what you’re fighting for and political will are as important to any battle as the hardware being brought to bear by each side on the other.

In Sanya, Brazil, Russia, India, and the hosts welcomed South Africa into their little club, and if they achieved little else they underscored that they are taking coordination among their countries very seriously and seeking to deepen their ties. However, they did go further and offered a broad agenda including more hints that they will push for alternatives to the dollar-dominated global monetary system that we currently have.

Of course, the BRICs summit resonates with the Libya follies because the original four BRICs voted as a bloc to abstain during the Security Council vote on the imposition of the no-fly zone in Libya and within days of its initiation were publicly speaking out against it. That they were joined in the vote by Europe’s most powerful country, Germany, also sent a message that the opposition to the initiative was meaningful and suggested that future votes in international institutions might see the BRICs (or the BRICS … if the final “S” is for South Africa) emerge at the core of a potent new alternative coalition to the traditional Western or developed powers.

NATO is at a watershed. The Libya “moment,” which President Obama and others wanted to offer up as an example of a new robust, American-led multilateralism, is quickly morphing into a demonstration of NATO’s weaknesses. America wants to be accorded the respect of being the leader but is hamstrung by domestic problems and a lack of strategic clarity. France and Britain seem willing to pick up the slack but others won’t follow. Germany seems increasingly uncomfortable with the burdens placed on it as Europe’s de facto leading power. The military alliance is overly dependent on U.S. power. There are too many chefs. There is not enough overall mission clarity.

Meanwhile, even while the BRICS are a long, long way from being politically cohesive, they are rent with divisions over important issues, and they have zero aspirations to anything as formal or as action-oriented as an alliance, they do have a few things going for them that make them powerful. For one thing, if you didn’t want to call them “the BRICS,” you might simply call them “the majority.” Because taken together, these five countries nearly total half the planet’s people, and if you add in the other countries that have much greater affinities with their views than they do with the Western alliance, it becomes by far the bulk of the world’s population. The Atlantic alliance may be where much of the money and power has been. The “BRICS Plus” represents not only the bulk of the world’s people and resources but also where the fastest growth is.

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Written by peripheralrevision

04/17/2011 at 12:53 pm

India: Congress hails BRICS joint declaration

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The Hindu, April 16, 2011

The Congress on Friday said the BRICS joint declaration endorsed India’s stand on the need for U.N. Security Council reforms and against unilateralism, and it reflected the country’s enhanced global footprint.

Party spokesperson Abhishek Manu Singhvi told journalists here that the joint declaration in China largely backed the stand of India, which steadfastly cautioned against unilateralism even in the face of the greatest provocations, particularly when it came to stepping on another country’s territory.

Mr. Singhvi said the party was happy that the BRICS Summit also recognised the urgent need for reforms in the UNSC in which “India has its legitimate expectations.”
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Written by peripheralrevision

04/17/2011 at 12:38 pm

BRICS ‘Wary’ of IMF Rules on Capital Controls

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Nasreen Seria, Bloomberg, April 17, 2011

Brazil, Russia, India, China and South Africa are “wary” about rules proposed by the International Monetary Fund on when controls can be used to curb short-term foreign-capital inflows, South African Trade Minister Rob Davies said.

While the IMF has agreed that limited use of controls may be appropriate, members of the so-called BRICS group, which met in China last week, are concerned that any restrictions may be to their “disadvantage,” Davies told reporters today in Pretoria.

Interest rates close to zero in the U.S., Europe and Japan have fuelled demand for high-yielding assets in emerging markets, boosting the currencies of Brazil and South Africa, while undermining their exports.

Brazil has imposed taxes on foreign-capital inflows to curb the real, which strengthened 5 percent against the dollar last year. South Africa has stuck to a policy of increasing foreign- currency reserves to curb the rand, which surged 11 percent against the dollar in the same period.

‘Wariness’

“There was a lot of wariness within the BRIC countries on how these rules will be structured and whether it will be structured to the disadvantage to any of them,” Davies said.

Capital controls were also the subject of the IMF’s semi- annual meeting in Washington this weekend. By keeping interest rates low, countries such as the U.S. are providing the “primary trigger of many of today’s economic woes,” Brazil’s Finance Minister Guido Mantega said yesterday. He defended the use of capital controls as legitimate “measures of self defense.”

While South Africa hasn’t imposed taxes to curb portfolio inflows, the government’s economic plan, called the New Growth Path, makes provision for these kinds of measures should it become necessary, Davies said.

“They have been mooted in the New Growth Path that the package on the table could be added to, as and when circumstances warranted it,” Davies said. “But we haven’t used any of these measures at this point.”

http://www.bloomberg.com/news/2011-04-17/brics-wary-of-imf-rules-on-capital-controls-south-africa-s-davies-says.html

Written by peripheralrevision

04/17/2011 at 12:18 pm

IMF/World Bank Ready to Listen to BRICS? – RT News

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From RT News:

The BRICS (Brazil, Russia, India, China, and South Africa) met in China, G20 gathered here in Washington D.C., and the IMF and World Bank are expected to have their spring meetings. But are institutions like the IMF and World Bank, and the Western Powers who control them, ready to let the rest of the world chime in? Center for Economic and Policy Research’s Mark Weisbrot.

Written by peripheralrevision

04/16/2011 at 11:24 am

Posted in +Video, Brazil, China, India, Russia, South Africa

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Peru election: No country ‘left’ behind

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If Ollanta Humala wins a run-off vote in June, he could align Peru with Latin America’s political left.

Greg Grandi, Al Jazeera, April 15, 2011

Last week, in Peru’s presidential election, Ollanta Humala, a 48-year old former military officer, pulled off a stunning come-from-behind victory.

Beating his four main rivals with over 30 per cent of the vote, Humala, who has called for a fairer distribution of Peru’s enviable economic growth, scares Washington and Wall Street.

Peruvians have committed “political suicide”, declared a former US ambassador to the country following the vote.

Equally unnerved is Peru’s Noble Laureate, Mario Vargas Llosa, who often uses his considerable descriptive talents to render in subtle hues the anxieties of Lima’s upper-class whites.

Since Humala didn’t get 50 per cent of the vote, he will face Keiko Fujimori, the daughter of jailed ex-president Alberto Fujimori, in a June run off – a choice Vargas Llosa describes as akin to one between “AIDS and terminal cancer”.

Many Peruvians, though, have worse fates in store for them than those two diseases. Despite Peru’s impressive macroeconomic performance, including low inflation, over the last decade, well over thirty per cent of Peru’s thirty million people live in poverty, and eight per cent in extreme poverty.

In the countryside, particularly the indigenous countryside, more than half of all families are poor, many desperately so.

Chavez soup

Central areas in Lima, the capital, are booming. Profits skimmed off the high price of precious metals – silver, zinc, copper, tin, lead, and gold make up sixty per cent of the country’s exports and finance the rise of luxury condos and malls.

But the city is also sprawling outward. Mining and other high-capital, low-labour export industries – among them, logging, petroleum, natural gas, and biofuels plantations – are ripping up the Andean highlands and Amazonian lowlands, throwing a steady number of families into Lima, where they add block after block to its perimeter.

Terminal cancer might be a concern among Vargas Llosa’s condo constituency, but these economic refugees, particularly their children, are more likely to suffer shantytown diseases, including malnutrition, protein deficiency, dysentery, and drug-resistant tuberculosis. Peru ranks 23rd out of 26th in Latin America for access to waste treatment.

While all the other candidates offer variations on a theme of “more of the same”, Humala promises mild reform. He pledges to improve health care for the poor and implement a means-tested pension plan for the elderly.

To pay for it, he said he will raise the taxes on mineral exports. This is hardly a radical program, but those who have grown fat off of Peru’s unsustainable model of economic development view it as catastrophic.

News of Humala’s first-round victory sent Peru’s currency and bond prices sharply down. Opinion and policy makers in Lima and the US rushed to their keyboards to warn of “class warfare”, as did the former US ambassador cited above.

The “outcome”, he said, “could not have been worse”. There is a saying in Latin America to describe the hysteria that overcomes elites when they hear someone suggesting a more equitable distribution of wealth: “when they sit down to dinner, they see Hugo Chavez in their soup.”

Power relations

Can Humala win in June? According to The Economist, polls taken before last week’s election found that “more than 77 per cent of voters expressing an opinion wanted to modify the country’s development model”. And 37 per cent wanted radical change.

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Written by peripheralrevision

04/16/2011 at 10:15 am

Posted in Argentina, Bolivia, Brazil, Ecuador, Peru, Venezuela

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Obama Continues Right-Wing Latin America Policies

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America’s ‘backyard’ has never been so united and independent of U.S. influence.

Steve Ellner, In These Times, April 14, 2011

In his State of the Union address in January, President Obama pressed for quick passage of a free trade agreement with Colombia, and since then has followed up on the proposal. In doing so he has delighted Republicans who had been accusing him of failing to prioritize the issue. In his January speech, Obama made no reference to his unequivocal concern over human rights violations which he had raised in his third presidential debate with McCain.

Since 2008, little has improved to justify Obama’s reversal. Human Rights Watch has reported a 41 percent increase in the number of victims in 2010 over the previous year, including the murder of 44 trade unionists. In the first six weeks of 2011, death squads assassinated three more labor activists.

In an attempt to assure members of U.S. Congress that progress is being made, on April 7 Colombian President Juan Manuel Santos and Obama announced from the White House the approval of an “Action Plan,” whereby the Colombian government pledged to take stringent measures to curb abuses. Many Colombian trade union leaders, however, refused to buy into the arrangement and expressed skepticism about their government’s resolve. Tarsicio Mora, president of the Unitary Workers Confederation (CUT), objected by saying, “It just can’t be that respect for a basic right established in the constitution, such as the right to life, has to be required by a commercial transaction.”

Obama’s new stand has also failed to win over U.S. trade unionists. In January, Communications Workers of America President Larry Cohen argued against the agreement by pointing out that 15 million Colombians representing 82 percent of the working population are not recognized as workers and thus under the law “have no rights.”

Obama’s change–from opposition to the free trade agreement with Colombia, to lukewarm endorsement of it, to vigorous support–is just one example of his turnabout on Latin American policy. His modified stand distances Washington from an important bloc of Latin American governments and contributes to the decline of the U.S. leadership position in the hemisphere.

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Written by peripheralrevision

04/15/2011 at 4:08 pm