25th January 2019
Brazil is committed to reforming the WTO as President Jair Bolsonaro stated in his opening address at the World Economic Forum in Davos on 22nd January.
President Jair Bolsonaro was elected in October with a clear mandate to reinstate sovereignty, order and economic freedom, from the depths of one of the gravest crises in our history. His mandate also includes bringing back sustainable growth and prosperity.
The Government of Brazil has engaged in a huge endeavor to approve long overdue reforms, to reduce costs, to deregulate, to facilitate business and entrepreneurship, and to open up our economy.
In international trade, our economic diplomacy has a critical contribution towards this aim.
We have been implementing a trade negotiation policy, which is attuned to the present-day world and its economic realities.
Brazil is aware of its responsibility. We are the eighth largest economy in the world. We are a leading country in agriculture, and it is important to say that the Brazilian agricultural production is the most sustainable in the world; and that our commitment to this sustainability is unwavering. We also have a great potential to become a leading country in other areas of international trade and innovation. The Brazilian trade policy will seek to unleash all of Brazil’s potential to increase its contribution to the international trade. The WTO constitutes an absolutely essential part of this effort.
The WTO is currently constrained by new trends and major geopolitical transformations. A systemic challenge lies before the Organisation. Blame for the crisis ought not to be apportioned to any single country. What we see is the result of a new distribution of global power and new sources of competition.
In Brazil, the voters chose a path which binds economic freedom with a strong sense of national identity and its values. We firmly believe that both dimensions – economic freedom and values – reinforce each other. The only solid foundation for a competitive liberal economy is a cohesive, authentic, and free society. This is also applicable at the international level. Throughout the world, the single foundation for liberalism is freedom. The sole firm foundation for a global liberal economy is human freedom.
On the launch of the WTO in 1994, there was much talk about ‘the end of history’. The thinking was that the liberal democracy was an undeniable given underpinning the international system. However, liberal democracy is no longer an undeniable given. Today, trade can be a great force for liberal democracy. Nevertheless, trade can also operate as a force, which leads to the opposite of liberal democracy. It is up to us to make trade a force for good, freedom and human progress.
Brazil believes that a revised structure outline for the WTO is necessary. Brazil is committed to a process of reform and modernisation of the WTO in line with our values. And that is not only because we are faced with an issue of the effectiveness of the multilateral trading system, but with an issue involving our values and our profound existential choices.
Brazil is prepared to be a force for change.
Brazil will fully engage its capabilities in the discussions regarding the WTO reform agenda.
Some points concerning the pathway ahead:
At the level of current institutional arrangements, we clearly have the theme of the dispute settlement mechanism. Brazil stands ready to examine ways of allaying existing concerns in a constructive manner. However, it is clear that the dispute settlement system, the Appellate Body in particular, constitutes an integral part of the multilateral trade system. Adjustment and reform presupposes both the functioning and the very existence of the mechanism.
There are the issues of monitoring and transparency in relation to this. Brazil has already submitted proposals aimed at improving the workings of the regular committees, and we stand ready to be at the forefront of this effort. The Canadian initiative to strengthen the WTO’s deliberative role is a step in the right direction. We look forward to coordinating the area of sanitary and phytosanitary standards of this initiative. Switzerland has also presented a proposal for transparency in the non-preferential rules of origin, which we have co-sponsored.
In the area of rules governing the negotiation process, Brazil stands ready to negotiate under any format – bilateral, plurilateral or multilateral. Brazil is ready to serve as a decisive force in the decision-making process, which may successfully lead to reforms and modernisation.
In terms of the range of themes up for negotiation, Brazil wishes to reinvigorate the negotiating arm of the WTO. I assure you that Brazil is prepared to discuss any agenda or matter whatsoever. We welcome, for example, the trilateral initiative of the United States, the European Union and Japan, which raises fundamental issues (such as the forced transfer of technology and the theme of companies controlled by States). Brazil will be ambitious on all negotiation fronts, from investment facilitation to electronic commerce. Furthermore, Brazil is prepared to discuss new special and differential treatment (S&DT) rules for future agreements.
However, if any reform agenda is to succeed, it must necessarily include the theme of agricultural subsidies. For Brazil, this is unambiguous and unavoidable.
In the coming weeks, Brazil will be presenting a concept paper setting out its ideas and vision concerning the reform of the WTO. We will remain entirely open to negotiate and discuss the reform and modernisation of the World Trade Organisation with all interested partners. Our stance is clear: we favour reform and stand ready to negotiate in good faith, thereby strengthening the multilateral trading system.