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Cablegate: Corrected Copy Media Reaction: Western Hemisphere:

VZCZCXYZ0002
OO RUEHWEB

DE RUEHSO #0177/01 0721705
ZNR UUUUU ZZH
O 131705Z MAR 07
FM AMCONSUL SAO PAULO
TO RUEHC/SECSTATE WASHDC IMMEDIATE 6520
INFO RHEHNSC/NATIONAL SECURITY COUNCIL WASHDC IMMEDIATE
RUEHBR/AMEMBASSY BRASILIA PRIORITY 7628
RUEHRI/AMCONSUL RIO DE JANEIRO PRIORITY 7875
RUCPDOC/USDOC WASHDC 2739

UNCLAS SAO PAULO 000177

SIPDIS

SIPDIS

STATE INR/R/MR; IIP/R/MR; WHA/PD

DEPT PASS USTR

USDOC 4322/MAC/OLAC/JAFEE
E.O. 12958: N/A
TAGS: KMDR OPRC OIIP ETRD BR
SUBJECT: CORRECTED COPY MEDIA REACTION: WESTERN HEMISPHERE:
PRESIDENT BUSH IN BRAZIL; SAO PAULO


1. "Lula And Bush In Globalization"

Economic columnist Carlos Alberto Sardenberg commented in
center-right O Estado de S. Paulo (3/12): "Many Latin American
nations have already signed free-trade agreements with the US and do
not pay the ethanol tariff Brazil has to pay.... Seen from this
viewpoint, Brazil is in a disadvantageous position given the Lula
administration's decision to bury the FTAA and its diplomats'
contempt vis-`-vis free-trade agreements with the US. This is an
ideological position adopted by the GOB, which, like the
demonstrators, only sees the US as an imperialist devil. Reality has
shown the contrary,that the US may become the preferential ally in a
globalization process that is in Brazil's interest because it may
foster economic growth and create jobs, especially in the interior
of the country. President Lula seems to have realized that and will
try to reach an understanding with Bush in the case of ethanol. But
let us imagine that Bush proposes the complete removal of tariffs on
ethanol in exchange for a removal of Brazilian barriers on
industrial and service sectors. Before answering, Lula will have to
consult with his Mercosul colleagues Chvez, Kirchner...."

2. "Bush Didn't Say What We Would Like To Hear"

Ambassador Marcos Azambuja opined in center-right O Estado de S.
Paulo (3/11): "Bush did not have the power or the intention to say
what we would like to hear: that the US will reduce protection of
its corn and facilitate the entry of Brazilian ethanol in its
immense market. Bush does not have the conditions to defy the US
agricultural lobby.... But there have been and there will be
advances in this area because our as well as the US's interest will
create space for accommodations that work for both parties.... We
are not on the top of the USG agenda for Latin America, which is
essentially negative: drugs, clandestine immigration, human rights
violations and environmental threats.... Brazil does well in not
serving as an instrument for the US policy interests in the region.
We have, for the most part, a sometimes turbulent and irrational
neighborhood and it is not useful for us to give preference to
others' interests over ours.... Our interests favor an efficient
multilateralism, and we can work with Americans, Europeans and the
main Asian nations in a firm and constructive way.... An enlarged
G-8 and a full participation in the OEDC are preferable to a
problematic permanent presence in the UN Security Council.... This
visit by President Bush has been perhaps the most profitable among
all visits of American presidents to Brazil.... The visit may have
helped Washington to recognize that Brazil is one of the necessary
pillars to build a multipolar, globalized and stable international
order."

3. "Few Decisions, Much Intimacy"

Center-right O Estado de S. Paulo remarked (3/11): "President Bush's
visit to S. Paulo neither marked a 'renewal' of Brazil-US relations
nor showed a higher level of 'intimacy' between the two nations, as
Foreign Minister Celso Amorim had announced. But the visit showed
that the contact between the two presidents became more fluid and
informal. The result of such a personal affinity will only be
noticed after March 31, when Lula will arrive in Washington for an
official meeting with Bush in Camp David.... Only time will be able
to reveal if the cooperation agreement in the biofuel area will
truly become a strategic partnership and bring benefits to Brazil
from the transformation of ethanol into a commodity and the opening
of markets. Bush's visit to Sao Paulo indicated that he has little
power to respond to Latin America's demands."

4. "Beyond Ethanol"

Liberal, largest national circulation daily Folha de S. Paulo (3/10)
editorialized: "The memorandum of cooperation on ethanol signed by
President Lula and Bush is a generic and unpromising document. What
saves it from irrelevance is the context in which it was signed. The
partnership to develop new technologies, the transfer of productive
know how to Latin American and Caribbean nations and the dialogue to
make ethanol a global commodity have gained importance due to
changes in the energy policy of the world's two largest economies.
The European Union has ratified its plan to use at least 10% of
biofuels in transportation by 2020. The US intends to add 20% of
renewable fuels to gasoline by 2017. Japan is just awaiting a sign
of confidence from the world market to announce a similar public
policy.... Therefore, it is natural that Brazil privilege
agricultural negotiations in both the Doha Round and its relations
with the US. But in the opportune strengthening of relations with
Washington, Brazil should have more comprehensive and strategic
goals. Brazil and the US - responsible for the FTAA fiasco - are the
only actors with the conditions to relaunch a trade liberalization

initiative in the Americas."

5. "Much Ado About Nothing"

Center-right national circulation daily O Estado de S. Paulo (3/10)
maintained: "Bush's capability to substantially reduce his
administration's lack of attention to Latin America in the second
term is negligible. The FTAA is gone and it is very unlikely that
ethanol will be the fuel of a new effective alliance between the US
and its southern neighbors. What really matters is that Bush does
not have and will not have political power in the US to go from
words to action.... The executive powers he abuses in foreign and
military policies do not extend to the trade arena.... Now that the
ethanol bubble - which had served to create the mirage that Brazil
would finally ascend to the First World through biofuel - has been
emptied, what remains from Bush's visit to Sao Paulo is a climate of
much ado about nothing. There is no doubt that Hugo Chvez's
influence has forced Bush to change his policy towards Latin
America, a region he ignored after September 11."
McMullen

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