EDITORIAL DECRIES LULA'S TRADE-NEGOTIATOR

UNCLAS SECTION 01 OF 02 BRASILIA 001831

SIPDIS

NSC FOR SHANNON, DEMPSEY
USTR FOR LEZNY, CRONIN
TREASURY FOR OASIA/SEGAL
FED BOARD OF GOVERNORS FOR ROBATAILLE
USDA FOR U/S PENN, FAS/FAA/TERPSTRA
USDOC FOR 4322/ITA/IEP/WH/OLAC-SC
SOUTHCOM FOR POLAD

E.O. 12958: N/A
TAGS: ETRD EFIN ECON EINV PREL PGOV BR
SUBJECT: EDITORIAL DECRIES LULA'S TRADE-NEGOTIATOR
CHANGES



1. In the wake of the GoB's surprise walk-out from
Mercosul-EU trade talks in Brussels July 21 (Septel),
Brazilian media focused heavily on the fact that Brazil's
negotiating team had abruptly changed chiefs just the
preceding week, with Brasilia-based Regis Arslanian
displacing long-time Ambassador to Brussels and ace trade
expert Jose Alfredo Graca Lima. From the start of Lula's
GoB, Arslanian (who is considerably junior to Graca Lima)
has been identified with the trade-policy ideology of
Foreign Minister Amorim and Deputy Samuel Guimaraes,
commonly seen as distinct from that of the senior trade
diplomats under Lula's predecessor. Itamaraty (Foreign
Ministry) officials including Amorim himself have
unconvincingly asserted that protocol rules caused Graca
Lima to be dropped from the GoB delegation and that the
switch has no import for policy. The broad informed local
sense is that the truth lies elsewhere, as charged in an
editorial of the July 22, 2004 'O Estado de Sao Paulo.'
Following is Embassy's unofficial translation of the
editorial in question.


2. (Begin Text of Unofficial Embassy Translation)

(HEADLINE) Tarnishing Itamaraty's Image

Over the past two decades, the Foreign Ministry has been
putting forth a generation of diplomats highly specialized
in trade negotiations. This team's competence is
recognized in all international fora and constitutes a
valuable asset to Brazilian diplomacy.

Since we are at a critical moment in negotiations on three
fronts - ALCA, Mercosul-European Union and World Trade
Organization - it would be natural that these diplomats
would be at the front of missions that defend Brazilian
interests. But this is not what happens.

One by one, these highly qualified diplomats, experienced
in the tough game of trade negotiations, are being removed
from their areas of specialization and replaced by
professionals of lesser intellectual brilliance, experience
and capacity for initiative, better able to follow to the
letter the minute (exact) instructions coming from the
Chancery. The diplomats who have been removed have in
common the fact of having served in prominent positions
during the government of Fernando Henrique Cardoso and are
committed, in some way, to the process of trade integration
and economic opening inherent to globalization. And that
is not, decidedly, the objective of President Luiz Inacio
Lula da Silva's foreign policy, formulated primarily by his
international adviser, Marco Aurelio Garcia, and by the
secretary-general of Itamaraty, Ambassador Samuel Pinheiro

SIPDIS
Guimaraes. Underlying this political shortsightedness is
the fear - motivated by an inferiority complex, we would
say, that a commercial association with the great economic
powers of the world leaves Brazilian producers and
consumers vulnerable to greater foreign competitive
capacity, forgetting that Brazil is among the 15 largest
economies of the world and is capable of competing, on at
least equal terms and conditions, in agricultural and
industrial markets worldwide. Proof of this are the
repeated records achieved by the trade balance and that are
not due - contrary to what the defenders of national-
statism would wish - to a policy of import-substitution,
but rather to the dynamism of the export sector.

The result of the change in negotiators is a new policy
turned towards the attempt to conclude South-South trade
agreements on a priority basis, that is, with countries
with few trade opportunities to offer Brazil. To make
matters worse, this is ruining the image that Brazilian
diplomacy always had in international fora, caused by the
inexperienced performance of some novice negotiators. One
example has entered the annals of international jokes - the
intervention of an ambassador having received tasks beyond
his capabilities who, during an Alca ministerial meeting
held in Puebla, said to his foreign colleagues that he
would very much like to see documents elaborated during the
Uruguay Round of GATT, but didn't know how to do it -
getting the stinging retort - "look on the internet".

The cycle of exchanging trade negotiators - for the worse -
was completed recently with the removal of Ambassador Jose
Alfredo Graca Lima from the delegation that represented
Brazil in the highest technical instance of negotiations
between Mercosul and the European Union. Ambassador Graca
Lima, currently head of the Brazilian mission to the
European Union, had accumulated 30 years experience in
trade issues. He was head of the Itamaraty's Economic
Department. He accompanied the entire Uruguay Round and
afterwards specialized in OMC issues, remaining in Geneva.
He participated in launching the project that culminated
with the Mercosul-European Union negotiations, which he
never stopped following. With all this experience, he was
removed from the Brazilian delegation, now headed by
Ambassador Regis Arslanian, who was promoted to the highest
career post only a month ago.

It is by removing Brazil from the principal trade currents
- those that make economic growth and technological
development possible - and relegating the best trade
diplomats to simple protocol functions, that the Lula
government intends to change world economic geography.

There's ideological prejudice, and there's pettiness!

(End Text of Embassy Translation)

DUDDY