The bets that failed Brazil’s next government will need a new foreign policy

 Mar 22nd 2014

SINCE it is the only big power in South America, Brazil inevitably catches the eye of outsiders looking for a country to take the lead in resolving the region's conflicts—such as the one raging in the streets of Venezuela. Yet leader is not a role that Dilma Rousseff, Brazil's president, is keen to play. She has reasons for her reluctance—and they explain why Brazilian foreign policy has run into trouble. Ms Rousseff has behaved as a loyal ally to the elected, but autocratic, government of Nicolás Maduro, which faces opposition protests almost daily. Brazil worked hard to thwart any role in Venezuela for the Organisation of American States, which includes the United States. Instead, the foreign ministers of the South American Union (UNASUR) have agreed to promote talks in Venezuela. It is an initiative without teeth: the ministers expressed their solidarity with Mr Maduro, disqualifying themselves as honest brokers in the opposition's eyes. In this sectionInside the barrios The bets that failed The man from MIT ReprintsRelated topicsTrade policy Free trade Business Trade Dilma Rousseff Brazil's wrong-headed calculation is that the protests will fizzle out. Mr Maduro took a UNASUR statement on March 12th as a green light to launch another crackdown. Faced with a deteriorating economy and mounting unpopularity, Mr Maduro's rule is likely to remain repressive. Given that Brazil's ruling Workers' Party (PT) claims to stand for democracy and human rights, he is a strange ally. One explanation is that Venezuela has become an issue in Brazil's presidential election in October, in which Ms Rousseff will seek a second term. Venezuela's left-right divide is echoed, albeit more faintly, in Brazil. Whatever the PT's differences with Mr Maduro's authoritarian populism, they are trumped by left-wing solidarity. Having done lucrative business in Venezuela, Brazilian companies want to repatriate their profits and worry that Brazil may fall out of favour in Caracas. In addition, Brazil's long tradition of multilateralism and non-intervention means its default position is to talk, not act. But not always. When Luiz Inácio Lula da Silva, Ms Rousseff's predecessor and political mentor, took office in 2003 he declared that Brazil would pursue a more ambitious foreign policy and seek a leading role in South America. Brazil duly forged closer ties with other rising powers of the global "south" and allied with them in the Doha round of world-trade talks. It sought a permanent seat at the UN Security Council. In South America a "pink tide" of electoral victories by the left allowed Lula's Brazil to recast Mercosur, the flawed customs union it leads, as an instrument of political co-operation, shared protectionism and social justice—an alternative to the "Washington consensus". When the 2008 financial crisis crippled the United States and Europe, Lula's bet on the south seemed to have paid off. But five years later, the world is a much harsher place for Brazil, as Matias Spektor, an international-affairs specialist at Kings College London, points out. Brazil's new friends in the south helped to torpedo any meaningful Doha deal. The relationship with China has disappointed. China failed to back its security-council bid; it is happy to buy Brazilian soyabeans, but not its manufactures. Most wounding of all, the countries of Latin America's western seaboard—Chile, Peru, Colombia and Mexico—have forged their own Pacific Alliance, built on free trade and free markets, in a tacit rebuke to Mercosur. Brazil still has international strengths. It has acquired influence in Africa, and has plenty of soft power (which will be enhanced if this year's football World Cup goes well). But in the region, its main allies now are ultra-protectionist Argentina and Venezuela, a basket case and political embarrassment. Brazil's underlying problem in South America is its ambivalence about exercising real leadership. That would involve opening its economy to its neighbours, and seeking integration based on mutual national interest and binding rules, rather than fleeting ideological solidarity. Brazil's foreign ministry recently launched a policy review (though, on South America, it is Ms Rousseff and her advisers who call the shots). So here is Bello's contribution: in Mercosur external trade negotiations are conducted by the bloc and hobbled by Argentina. Brazil should set out to turn it into a free-trade area instead. Brazil could then do trade deals with the Pacific Alliance, the EU and others. And it should recognise that the democracy clauses in regional agreements do not merely require condemnation of coups but also oblige elected presidents, like Mr Maduro, to adhere to minimum standards of democratic governance and human rights. Unfortunately, such changes are likely only if the opposition wins in October.

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