October 20, 2020
Former Director of the United States National Economic Council, United States National Economic Council
Former Executive Vice President and Head of International Affairs, U.S. Chamber of Commerce
The U.S. and Brazil are the largest democracies and economies in the Western Hemisphere, and economic cooperation between the two countries is crucial. Their partnership is rooted in mutual commitment to economic growth and prosperity, international peace, security, respect for human rights, and defense and security.
Myron Brilliant, U.S. Chamber of Commerce’s EVP and head of International Affairs, spoke with Ambassador Robert Lighthizer, United States Trade Representative, and Larry Kudlow, Director of the United States National Economic Council, at the U.S.-Brazil Connect Summit about why a strong U.S.-Brazil relationship is so important. Here’s what they shared.
The Strength of the U.S.-Brazil Relationship Depends on Continued Economic Cooperation
The U.S. and Brazil currently have a strong economic relationship, and both countries are taking strides to make it even stronger. That is why on October 19, 2020, the U.S. and Brazil virtually negotiated and signed a new and updated agreementon trade and economic cooperation between the two countries.
“We added a trade facilitation agreement on good regulatory practices and one on anti-corruption,” said Lighthizer. “All state-of-the-art, all very similar to what's in the USMCA obligationsbeyond those required by the WTO.”
He added that this was an especially important agreement, because the beginning of having improved economic relations is ensuring both presidents get along and offer mutual support. The trade initiative reinforces our positive relations with Brazil.
The U.S. and Brazil Must Work Together to Navigate the Post-Pandemic Economy
The post-pandemic economy is one of the biggest challenges we currently have as a nation and as a global economy, but Kudlow hopes we can continue working with Brazil to help with reforms and meet these challenges.
“We have good bilateral relations with Brazil,” said Kudlow. “This recent trade initiative I think is a huge plus. And I know Brazil is working towards various important pro-growth economic liberalization reforms, including the rule of law, and I think that’s a terrific thing.”
The U.S. and Brazil Must Both Keep a ‘Careful, Critical Eye’ on China
China is considered Brazil's largest trading partner. In the U.S., we have taken action to protect ourselves from China, and our aim is to get Brazil to move with us.
“We have encouraged Brazil and the Brazilian government … to try to work together to make sure that we watch China carefully with respect to all matters of technology and telephoning and 5G, but also advanced technologies and their various investments in Brazil and in the United States,” said Kudlow.
He then stated that the U.S. monitors problems with China accounting and fraud, and lack of backup research papers, and called for the Brazilian government to keep a “careful, critical eye on Chinese investment.”
"Clearly there is a China element ... in everything that all of us do," Lighthizer added later in the summit. "China has made a very significant move in Brazil. They're Brazil's biggest trading partner, so it's something that we're concerned about."
The U.S. Calls for Economic Liberalization for the Greater Good of the Global Economy
Economic liberalization will better help the U.S. and global economy alike. The trade agreement signed on October 19 is a signal that the U.S. wants to work with Brazil and push reform in these areas.
“I think that it's in the interest of the United States to encourage liberalizers in all significant economies of the world,” said Lighthizer. “That's clearly in our interest, in the interest of prosperity for the global economy.”
By encouraging Brazil to liberalize its own economy, we are signaling to other regions — even those that are protectionists — to adopt similar policies.