The Foreign Service Journal, June 2011

J U N E 2 0 1 1 / F O R E I G N S E R V I C E J O U R N A L 29 ties. U.S. officials were encouraged that President Rous- eff swiftly changed Brazilian policy in one crucial area: Her government will no longer ignore or downplay Tehran’s re- pression, and she has instructed her United Nations am- bassador to endorse an investigation of human rights abuses in Iran. However, it remains uncertain how Brasilia will deal with other U.S. concerns, such as Iran’s support of terrorist groups and its unrelenting threats toward Is- rael. What most troubles Washington is Brazil’s defense of Tehran’s nuclear program and its right to enrich uranium. Washington was particularly infuriated that Brazil and Turkey negotiated an agreement with Iran designed to halt a U.S.-led drive for new U.N. sanctions against Tehran. Neither Brazil nor the U.S. managed this incident partic- ularly well. In a letter to Lula, the Obama administration even ap- peared to encourage the Brazilian negotiating initiative. Washington later made clear its opposition to Brazil’s in- volvement, but the Lula administration proceeded as if it still had American agreement. In any case, if Washington had not been so focused on pursuing stronger sanctions against Iran, it might have recognized the potential value of the deal, rather than rejecting it out of hand. Perhaps Brasilia did overreach, but officials believed they could help build the confidence needed to facilitate new, U.S.- led talks with Iran. Iran will likely remain an irritant for bilateral relations. While Washington is convinced that Tehran is developing nuclear weapons, Brasilia has steadfastly opposed sanc- tions, although it has respected those imposed by the United Nations. The two capitals might usefully explore the question of what evidence would be sufficient to con- clude either that Tehran is pursuing a weapons capability or that its intentions are peaceful. Narrowing the gap on this central question would be a helpful step toward greater accord. The U.S. might also consider bringing Brazil and Turkey into the six-power talks with Iran (the five members of the U.N. Security Council plus Ger- many). Their presence might diminish Iran’s distrust of the negotiations and potentially increase the prospects of some advance. Over time, Brazil’s own nuclear activities may emerge as a major source of contention. True, Brazil has signed the Nuclear Non-Proliferation Treaty, and is committed to forgoing nuclear arms by its own constitution, the hemi- sphere-wide Treaty of Tlatelolco and an agreement with Argentina. So the U.S. today has little concern that Brasilia seeks atomic weapons, though it has embarked on a ura- nium enrichment program and will soon have the ability to build such weapons. Brazil and the U.S. are, however, at odds over Brasilia’s refusal to sign the NPT’s additional protocol, which calls for more intrusive inspections of enrichment facilities. Washington sees Brazil’s rejection of the new protocol as weakening already-shaky global nonproliferation efforts. For its part, Brasilia asserts that Washington and Moscow are the players who have most egregiously failed to fulfill their obligations under the treaty. Tension over this issue will become harder to contain as Brazil and a few other nations come closer to a weapons capacity. Ideally, nuclear development should be an area for co- operation, not a matter of dispute. U.S. technology could contribute a great deal to Brazil’s development of a world- class nuclear energy industry. Washington’s three-year-old agreement with India (which already possesses a nuclear arsenal) is the model for a technology accord with Brazil. What the U.S. would want in exchange is greater Brazilian support for the NPT and other nonproliferation initiatives. The Trade Agenda Trade has long been a source of bilateral friction. Var- ious subsidies, tariffs and quotas sharply restrict U.S. im- ports of half a dozen or more of Brazil’s major export crops. They have, for example, effectively closed the U.S. market to Brazilian ethanol, which is substantially cheaper and more energy efficient than the U.S. variety. Last year, trade tensions rose sharply after Brazil won its World Trade Organization suit against Washington, in which it claimed U.S. cotton subsidies violated international trade rules. Because the subsidies will remain in place at least until the relevant U.S. legislation terminates in 2012, the WTO au- thorized Brazil to retaliate by slapping tariffs on an array of U.S. imports and disregarding U.S. patents. After some acrimony, Washington managed to paper over the dispute and postpone retaliation for the next cou- ple of years by agreeing to compensate Brazil directly for its lost cotton sales (thereby, in essence, subsidizing both U.S. and Brazilian cotton growers). And cotton is not the only problem. Brazil just recently prevailed in another WTO case over U.S. countervailing duties on Brazilian or- ange juice, and is prepared to continue its challenges to other U.S. agricultural protectionist measures. Their ongoing clashes notwithstanding, the two coun- F O C U S