Cablegate: Media Reaction: Doha Round, Ustr Schwab in Brazil; Sao

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OO RUEHWEB

DE RUEHSO #0829 2121343
ZNR UUUUU ZZH
O 311343Z JUL 06
FM AMCONSUL SAO PAULO
TO RUEHC/SECSTATE WASHDC IMMEDIATE 5512
INFO RHEHNSC/NATIONAL SECURITY COUNCIL WASHDC IMMEDIATE
RUEHBR/AMEMBASSY BRASILIA PRIORITY 6587
RUEHRI/AMCONSUL RIO DE JANEIRO PRIORITY 7314
RUCPDOC/USDOC WASHDC 2522

UNCLAS SAO PAULO 000829

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: MEDIA REACTION: DOHA ROUND, USTR SCHWAB IN BRAZIL; SAO
PAULO

1. "Truculence in Trade Negotiations"

The lead editorial in center-right O Estado de S. Paulo (7/29)
opined: "Among other topics, USTR Susan Schwab and Foreign Minister
Celso Amorim are expected to discuss conditions to reactivate the
Doha Round. But the terms of the bilateral cooperation in this case
are not clear, because the arrival of the US trade representative
was preceded by a warning gun salute fired by Senator Charles
Grassley [who] suggested that the US should retaliate Brazil and
India for, according to him, having hampered the round's conclusion.
Everyone knows that the negotiations stuck mainly because of the
impasse between the US and the EU about agricultural policies....
The GSP is a unilateral concession and therefore the Americans may
remove it in its next renewal, in December. It's their right. But
it is also right to affirm that this benefit far from offsets the
losses imposed on other nations resulting from subsidies given to
the US agricultural sector and by the frequent imposition of highly
arbitrary trade barriers.... In a remarkable coincidence, Ambassador
Schwab is expected to ask the Brazilian minister to convince the
Indian government to open its market to imports of agricultural
products.... It is clearly excessive to focus on India's
agricultural policy as the main obstacle to the Doha Round's
success. The US responsibility in this aspect is much greater. If
the USG recognizes this fact, it will be much easier to reactivate
the round. If not, it will subordinate its policy to Senator
Grassley's interests."

2. "Empty-handed"

University Professor Marcelo Paiva de Abreu maintained in
center-right O Estado de S. Paulo (7/31): "Everything indicates that
the suspension of the Doha Round ministerial negotiations has
jeopardized the deadline established for the conclusion of the talks
because it is incompatible with the requirements of the US political
agenda, especially in regards to the TPA's term. Unless unexpected
spectacular developments occur, the most likely outcome is a
postponement of the conclusion of the current negotiations for two
or three years, but it will depend on an optimistic hypothesis that
the US Congress' will be wiling to approve a future fast track....
Only the most radical supporters of agricultural protectionism in
the US Congress are considering that Brazil is responsible for the
impasse, since it resisted Washington's subsidies cut proposal that
maintains them on the current level.... Will bilateral agreements be
capable of replacing multilateral negotiations? It is difficult to
believe that Mercosul's talks with the EU have been facilitated by
Venezuela's entry in the South American bloc."

3. "Doha: Victory Or Defeat?"

Former Minister of Finance Luiz Bresser Pereira wrote in liberal,
largest circulation daily Folha de S. Paulo (7/31): "Contrary to
what has been said, the suspension and virtual failure of the Doha
Round represented more a victory than a defeat for Brazil. The
ideal would have been a great reduction in agricultural subsidies in
exchange for a small diminishment of industrial tariffs and minimal
concessions in the area of services, but the alternative being
supported by the US, Europe and Japan was opposed, and in that case
the damage to Brazil would have been greater. Such harm was avoided
because Brazilian diplomacy was able to define and defend the
developing nations' interests.... In view of the Doha Round fiasco,
some say that the alternative for Brazil is bilateral agreements.
There is no doubt about that but everything will depend on the
quality of the agreements."

4. "A World Of Subsidies"

Center-right O Estado de S. Paulo (7/29) editorialized: "Governments
around the world spend much more than one could have imagined so far
in subsidies given to agricultural, industrial and services sectors.
According to a WTO report, such subsidies may total USD 1 trillion
annually.... The study clearly shows that the developed nations are
the ones that most use the taxpayers' money to subsidize different
sectors of the economy.... Actually, it was the impasse on this
topic that caused the collapse in the Doha Round negotiations.
Subsidies given by rich nations to agriculture range between USD 230
billion and USD 280 billion every year.... A great part of the
world's economy works only based on subsidies.... Agricultural
products exporting nations like Brazil have been harmed by this
practice. Brazil is one of the nations that give least subsidies to
the private sector.... Brazil is also one of the few nations that
reveal the sectors that receive governmental assistance."
McMullen

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