Cablegate: Visit of Professor Jeffrey Sachs to Brazil

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RR RUEHRG
DE RUEHBR #2678/01 3601556
ZNR UUUUU ZZH
R 261556Z DEC 06
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC 7715
INFO RUEHRI/AMCONSUL RIO DE JANEIRO 3599
RUEHRG/AMCONSUL RECIFE 6040
RUEHSO/AMCONSUL SAO PAULO 8900
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RUEHTO/AMEMBASSY MAPUTO 0087
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RUEHLI/AMEMBASSY LISBON 0412
RUEHRC/USDA WASHDC

UNCLAS SECTION 01 OF 03 BRASILIA 002678

SIPDIS

SIPDIS

DEPARTMENT PASS EPA, HHS, CEQ
USAID FOR AA/LA

E.O. 12958: N/A
TAGS: SENV PREL ECON EAID BR
SUBJECT: Visit of Professor Jeffrey Sachs to Brazil

1. Summary. During a December 12-13 visit to Brasilia and Sao
Paulo, noted economist Jeffrey Sachs met with high-level government
policymakers, NGO representatives, and business representatives. In
his meetings with Brazilian interlocutors, Sachs stressed that the
U.S. and Brazil need to find a way to work together to tackle key
problems such as poverty, development, climate change, disease, and
deforestation. He emphasized the interrelated nature of all these
issues and suggested that the two governments look to partner to
help Luso-phone Africa deal with these problems. In his public
remarks to the media and the business community in Sao Paulo, the
Ambassador underscored the responsibility of the private sector to
promote development through training and education. The Sachs visit
was extremely helpful to the Mission in bringing to the fore the
United State's desire to move forward on the pressing environmental
and development issues within this hemisphere and the Third World.
By highlighting our desire to build bridges between our two
countries, this kind of programming is invaluable to our efforts to
improve the image of the U.S. abroad. End Summary.

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Meeting with Presidential Advisor Marco Aurelio Garcia
----------------------- -------------------------------

2. In his December 13 meeting with Presidential foreign policy
advisor Marco Aurelio Garcia, Sachs focused on (1) sustainable
development cooperation efforts between the U.S. and Brazil,
particularly in Africa, (2) the role of both bio-fuels and effective
malaria prevention as components of these efforts, and (3) a
post-Kyoto system for climate control that involves incentives for
avoidance of de-forestation. He sought Brazilian involvement in all
of these areas, in conjunction with UN, bilateral or private
projects, and emphasized that Africa looks to Brazil and Lula for
leadership, expertise and technology assistance.

2. On malaria, Sachs previewed his participation in President
Bush's Prevention of Malaria Initiative (PMI), reviewed the gravity
of the malaria threat in Africa (two million dying per year), and
also noted Brazil's substantial malaria problem. For very low cost
in comparison to the potentially profound benefits, prevention
projects (e.g., distribution at low cost of thousands of bed nets)
and innovative pricing/distribution of modern medicines could --
"from one day to the next" -- make a drastic difference in Africa's
malaria problem, he declared.

3. According to Sachs, bio-fuels technology also offers enormous
hope and promise in Africa, and here Brazilian leadership and
technology are absolutely key. Biofuels offers the potential for
employment, industrialization, profitable agriculture, and business
- all elements that, like health, are essential to the village-based
development model Sachs' Millennium Project has implemented with
success in some African states. Creating a "payment stream" to
provide incentives for poor countries to avoid deforestation is also
a transformational concept that ought to be implemented, Sachs
continued, noting that Brazilian leadership here would also be
crucial.

4. Sachs proposed Sao Tome as one micro-state in which low cost but
thoughtfully coordinated initiatives in both malaria and bio-fuel
development would literally transform the country in a short period.
Mozambique, on a much larger scale in terms of bio-fuel capacity,
is another nation receptive to, and ripe for, transformational
programs. Sachs urged consideration of U.S.-Brazil joint efforts in
both states.

5. Garcia replied that Africa is a major element in contemporary
GOB foreign policy; he noted the recent Brazil-Africa summit,
multiple Lula visits to Africa, and the fact that 20 African heads
of state have visited Brazil. Lula sees Africa as an important
vocation for Brazil, not only Lusophone Africa, he said, with
African countries looking to Brazil for leadership and help.

6. Garcia said Brazil would welcome "trilateral cooperation"
projects with the U.S. in Africa. In health, Brazil is planning a
factory in Africa for the production of HIV medicines and the GOB is

BRASILIA 00002678 002 OF 003

also focused on malaria there. He noted that he had visited Sao
Tome, and opined that the tiny country is "completely dominated by
malaria." But "with just 20 million dollars you could end the
problem there once and for all."

7. On bio-fuels, Garcia reviewed the integral role in Brazil's
energy matrix now played by various forms of bio-fuels. He
discussed Brazil's evolving program to provide tax breaks to
bio-diesel producers who purchase raw product from family farms -
e.g., a small bio-diesel plant with 20 or 30 employees can generate
rural employment for around 20,000 people. In Africa, the potential
for such projects would be highly promising, both in terms of energy
and economic development, and for employment - especially keeping
people gainfully employed in the countryside, and away from the
chaotic cities.

8. Sachs replied that Brazil's timing and ideas are perfect, and
Sao Tome and Mozambique would be excellent starting points for
collaborative efforts. He urged the GOB to send a high-level
delegation to the January African Union meeting in Ethiopia, where
these issues could be discussed with interested nations.

------------------- -----------------------
Meeting with Chief of Staff Dilma Rousseff
----------------- -------------------------

9. Sachs reviewed the same prime issues with Rousseff: i.e.,
cooperation on malaria and bio-fuels in Africa, the President's
Malaria Initiative, and de-forestation.

10. On malaria, the Brazilian Health Minister and his malaria
program director were also present in the meeting, and they provided
information on the scope of Brazil's malaria problem. Brazil
registered 500,000 cases last year, but with fewer than a dozen
fatalities, they said. All states but Acre are show a decrease in
malaria. The outbreaks are concentrated in Amazonas and Acre, and
are spread by bites in outdoor environments, as opposed to African
bites, which often occur within dwellings - hence use of bed nets
has not been a priority in Brazil -- although the Health Ministry
will expand their usage in the near future, Sachs was told.

11. Sachs expressed admiration for Brazil's leadership and
technological progress in bio-fuels, and said bio-fuels are a key
component for African poverty alleviation, one "that makes good
development and political sense." He again proposed Sao Tome and
Mozambique as good pilot states - in different ways -- for
bio-fuels and health projects.

12. Rousseff welcomed enthusiastically Sachs' interest in
cooperation with Brazil on bio-fuels and development projects in
Africa. "We can make a partnership," she declared explicitly,
underscoring, like Garcia, Lula's strong commitment to Africa. She
noted that Lula had instructed his ministers to develop, in his
second term, a structured program of assistance to Africa, and that
a task force is now being formed for this. The task force will
include several ministries, EMBRAPA, and Petrobras.

13. Rousseff discussed at some length the various types of
bio-fuels in development and use in Brazil, and their applicability
to different situations in developing states. For Africa,
bio-diesel could be the best solution in some agricultural
environments, while ethanol could work elsewhere, although ethanol
requires larger scales of production for viability then bio-diesel
production, which can be usefully carried out on a micro scale.
Rousseff also said Brazil is looking at providing some of its
successful R&D in soils and seeds to Africa - she noted that Sao
Tome is located at the "continental breakage point" from which the
South American continent appears over the millennia to have
separated from Africa. Hence soil conditions there could be
amenable to successful Brazilian soil/seed projects that have vastly
increased Brazilian agricultural productivity in previously fallow
areas.

14. Rousseff also noted the African Union Summit in Ethiopia in

BRASILIA 00002678 003 OF 003

January, and said Brazil planned to send a delegation.

--------------------- ----------------------------
Meeting with Minister of Environment Marina Silva
---------------------- ---------------------------

15. In his call on Environment Minister Marina Silva, Sachs
expressed interest in Brazil's plan for payment for avoided
deforestation (note: Foreign Ministry officials at the December 13
Common Agenda Meetings clarified that the GOB avoids the use of the
term "avoided deforestation" in favor of "positive incentives to
reduce deforestation emissions"). Marina Silva characterized the
"positive incentive" proposal presented by Brazil at the November
U.N. Framework Convention on Climate Change meeting in Nairobi as a
paradigm shift, and the "challenge of the century," asserting that
reductions in deforestation during the past two years are
attributable to coordinated action of thirteen ministries to fight
illegal deforestation. Minister Silva described the positive
incentive payment program as results-based and entirely voluntary.
Payments would only be made when and if a developing country
succeeds in reducing deforestation beyond an agreed reference
emissions rate. She described this initiative as a positive example
and fruit of long-term international scientific collaboration in
Brazil (note: background field science and policy analysis on this
issue were supported by USAID/Brazil. Jeffrey Sachs described the
positive incentive proposal as a very powerful approach to
sustainable development, one that could become a signature issues in
the search for practical solutions to greenhouse gas emissions,
biodiversity loss, malaria outbreak, and rural poverty resulting
from tropical deforestation.

--------------------------- -----------------------------
Corporate Social Responsibility (CSR) Event in Sao Paulo
--------------------------- -----------------------------

16. Late in the afternoon on December 13, Sachs spoke at the US
Consulate in Sao Paulo to an audience of approximately 100 CEOs,
business leaders, academicis and NGO leaders. Sachs spoke at the
invitation of the Ambassador, who since his arrival in August 2006
has been committed to the development of a public-private CSR
partnership between the US Embassy and the US corporate sector in
Brazil.

17. Sachs discussed the various roles of corporate social
responsibility programs in fighting extreme poverty, promoting
regional economic development and growth, investing in the
individual for societal good, and maintaining economic development
aligned with environmental sustainability. Emphasis was placed on
the importance of investment in education and technology. Sachs also
compared poverty and the economic situations of Africa, China, India
and Brazil. Sachs presentation generated much interest not only
with the audience present, but received extensive press coverage as
well. Indeed, he granted exclusive interviews to two prominent
print and television outlets. Afterwards, he attended a dinner
including former president Fernando Henrique Cardoso, leading
bankers, businessmen, and academics and continued the discussion
there, once again stressing the role of technology and education in
reducing the extreme levels of poverty in developing countries.

Sobel

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