"Brazil : the Rising Power in Latin America"

The symbolism was clear. With the United States at the fag-end of a disastrous presidency, Brazil assembled 33 countries from across the Americas to discuss a host of issues ranging from defence to the economic slowdown. The two-day gathering, at a resort near the northeastern city of Salvador, marked the first time that every country in Latin America and the Caribbean had met without the presence of the United States or Europeans. The message: it is Brazil, with a growing economy and a popular president in Luiz Inácio Lula da Silva, and not the United States that is now the leading power in the region.




But the substance was slight. The get-together involved three separate meetings, at each of which fraternal wishes were overshadowed by political differences. The members of Mercosur, which is meant to be a customs union, were unable to agree on rules for importing goods from outside the block. The members of Unasur, a fledgling South American political union, set up a defence council intended to defuse conflicts. But they failed to choose a secretary-general for Unasur.




The wider gathering was notable for the presence of Cuba’s Raúl Castro, making his first trip abroad as the communist island’s head of state. That stimulated the usual anti-American rhetoric from some leaders. But as usual, too, Brazil’s message was more subtle. “We want to have a good relationship with the United States. But we…don’t depend on external tutelage,” said Celso Amorim, the foreign minister.




Lula’s government arrived in office in 2003 with three main foreign-policy aims: to secure a permanent seat on the United Nations Security Council; to get a world trade deal; and to create a powerful South American block. All this was to be brought about in a spirit of partnership with other developing countries.




Trade and other ties in Africa and Asia have indeed been strengthened. Brazil has successfully led the UN mission in Haiti. But in other respects, the record has been one of frustration. China was prominent in blocking reform of the Security Council (to stop Japan joining). Despite Brazil’s best efforts, the Doha trade talks have stalled.




Regional integration has proved complicated. Within Mercosur, barriers to trade are multiplying rather than lapsing. An agreement to bring in free trade in cars by 2007 has been postponed. The countries that form the pact (Argentina, Brazil, Paraguay and Uruguay) failed to adopt a common stance in the Doha talks.




In Lula’s first term, Brazil was noticeably warm towards some of the far-left regimes in the region, backing Venezuela’s president, Hugo Chávez, and turning a blind eye towards his hollowing out of democratic institutions. Foreign policy was used as a way to send signals to supporters of the Workers’ Party that Lula’s was a real left-wing government, even if its economic policies were orthodox, says Sérgio Amaral, a former ambassador and minister in a previous administration.




But Lula’s pledge that Brazil would be generous to smaller neighbours to boost integration has not always been reciprocated. He was embarrassed when, with Mr Chávez’s active encouragement, Bolivia’s socialist leader, Evo Morales, nationalised the operations in his country of Petrobras, Brazil’s energy giant, in 2006. Brazil’s diplomats say that rising economic power means that at every meeting on trade, they are confronted with a demand to do more for their neighbours. “Perhaps by being so tolerant we have actually been patronising,” says one diplomat.




That has led to a tougher approach. Left-wing presidents in Ecuador and Paraguay with grievances against Brazil are getting a sharper response. In September Ecuador’s president, Rafael Correa, expelled managers of Odebrecht, a Brazilian engineering company which he accuses of bribery and shoddy construction of a power plant. He is refusing to repay a $243m loan for the plant from Brazil’s national development bank. (Ecuador also defaulted on some of its bonds this month.)




That led Brazil to recall its ambassador. It has brushed off demands from Fernando Lugo, Paraguay’s new president, to renegotiate a treaty under which his country sells Brazil electricity. Brazil never criticises Mr Chávez in public but it increasingly seeks to outflank him. One way of doing that while also doing business involves closer ties with Cuba.




This week’s meeting may be the germ of a new pan-Latin American club. But despite much bonhomie, regional harmony remains elusive. The United States will soon have a popular new leader, who will doubtless be the star of a 34-country (all except Cuba) Summit of the Americas in Trinidad in April. Brazil has indeed become much more influential in the region. But its is not the only game in town.