RL33456
Brazil-U.S. Relations
October 06, 2008
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Summary
On January 1, 2007, Luis Inᣩo "Lula" da Silva, of the leftist Workers' Party (PT), was inaugurated for a second four-year term as President of Brazil. Lula was re-elected in the second round of voting with fairly broad popular support. His immediate tasks were to boost Brazil's lagging economic growth and address the issues of crime, violence, and poverty. Despite President Lula's personal popularity, many predicted that intra-party rivalries within his governing coalition would make it hard for him to push his agenda through Brazil's notoriously fractured legislature. President Lula enjoys high approval ratings (80% in September 2008) and is benefitting from a strong economy (GDP growth exceeded 5% in 2007). Ongoing corruption investigations involving President Lula's PT party have not diminished the strength of his second term in office. Some have criticized President Lula, however, for thus far being unwilling or unable to use his significant political capital to gain legislative approval for a more robust political and economic reform agenda. During the first Lula term, Brazil's relations with the United States were generally positive, although President Lula prioritized strengthening relations with neighboring countries and expanding ties with nontraditional partners, including India and China. Brazil-U.S. cooperation has increased during President Lula's second term, particularly on energy issues. Two presidential visits in March 2007 culminated in the signing of the U.S.-Brazil Memorandum of Understanding (MOU) to promote greater ethanol production and use throughout Latin America. Some predict that, given its recent deep-water petroleum discoveries, Brazil could eventually become a major oil supplier to the United States. During its second session, the 110 Congress has maintained an interest in Brazil, particularly its role as an ethanol producer. On October 9, 2007, the House passed H.Res. 651 (Engel), recognizing the expanding relationship that exists between the United States and Brazil and the importance of the U.S.-Brazil biofuels cooperation. Another bill, S. 1007 (Lugar), that would deepen Brazil-U.S. energy cooperation and provide $60 million to support the U.S.-Brazil MOU on biofuels was reported out of the Senate Committee on Foreign Relations on September 23, 2008. Two bills have been introduced -- H.R. 6183 (Brown-Waite) and H.R. 6137 (Shadegg) -- that would eliminate tariffs on imported ethanol. Another bill was introduced, S. 3080 (Feinstein), that would require the President to periodically adjust the ethanol tariff so that it remains the same as the blender's tax credit. On September 29, 2008, the House passed H.R. 7222 (Rangel), which would extend current trade preferences for Brazil and other countries under the Generalized System of Preferences (GSP) through December 31, 2009. The Senate passed H.R. 7222 on October 2, 2008. On September 9, 2008, the House passed H.Res. 1254 (Engel), supporting the new U.S.-Brazil Joint Action Plan Against Racial Discrimination. This report, which will be updated periodically, analyzes Brazil's political, economic, and social conditions, and how those conditions affect its role in the region and its relationship with the United States.
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Related Legislation:
- S.1007
- H.R.6183
- H.R.6137
- S.3080
- H.R.7222
- H.RES.651
- H.RES.1254
