27.11.2018

CLIPPING INTERNACIONAL NEGINT Brasília, 27 de novembro de 2018

Índice I. OMC _______________________________________________ 2 EU proposes new WTO reform to safeguard dispute settlement system under threat by U.S. __________________________________________________ 2 EU trade chief urges U.S. to join talks on WTO reform ___________________ 3 EU's Vestager tells China it is time to deliver on WTO reform _____________ 5 II. NEGOCIAÇÕES REGIONAIS E BILATERAIS _________________ 5 Trump warns Brexit agreement could threaten future US-UK trade deal _____ 5 Investors Hope Trade Deals Are in G-20's Plan _________________________ 7 III. OUTROS ____________________________________________ 8 Bolsonaro se postula como el gran aliado estratégico de Trump en América Latina _________________________________________________________ 8 Trump-Style Foreign Policy Tantalizing Idea for Broke Brazil _____________ 10

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I. OMC EU proposes new WTO reform to safeguard dispute settlement system under threat by U.S. Financial Post (Reino Unido) The European Union unveiled a new proposal that seeks to stave off paralysis of the World Trade Organization’s dispute settlement system by unblocking the appointment of its appellate body members, according to a statement Monday. The proposal has the backing of Australia, Canada, China, Iceland, India, Korea, Mexico, New Zealand, Norway, Singapore and Switzerland. “The appellate body function of the WTO dispute settlement system is moving towards a cliff’s edge,” EU trade chief Cecilia Malmstrom said in the statement. “Without this core function of the WTO, the world would lose a system that has ensured stability in global trade for decades.” The proposal will be presented at the WTO’s General Council on Dec. 12. For more than a year the Trump administration has blocked appointments to the appellate body, which has the final say in upholding, modifying or reversing rulings that often affect some of the world’s biggest companies and billions of dollars in commerce. If the U.S. continues its hold, the body will be paralyzed in late 2019 because it won’t have the three panelists required to sign off on rulings. KEY INSIGHTS The EU paper is important because it aims to shift the WTO’s nascent reform discussions toward negotiations on a concrete text.The proposal won’t advance until the U.S. and the rest of the WTO’s 164 members agree to amend the WTO dispute settlement understanding, which is considered to be a significant undertaking.The proposal is unlikely to gain the backing of the U.S., which has criticized the appellate body for overstepping its mandate with aggressive interpretations of WTO rules.

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MAIN PROVISIONS Creates new rules for outgoing appellate body members, defining when they can stay on to complete ongoing proceedings. Ensures that appeal proceedings are completed in the 90-day timeframe set out by the WTO. Introduces annual meetings between WTO members and the appellate body.In a separate but complementary proposal, the EU suggested reinforcing the appellate body’s “independence and impartiality to improve its efficiency” by: Adding two new appellate body members to the 7-member panel, give them full-time jobs and give the appellate body additional administrative and legal support Modifying the term limit for appellate body members from two four-year terms to a single six- or eight-year term Creating an automatic selection process to replace outgoing appellate body members months ahead of the expiration of their terms.

EU trade chief urges U.S. to join talks on WTO reform Reuters (Reino Unido) The European Union called on Washington on Tuesday to start talking over ways of reforming the World Trade Organization to prevent a paralysis of the international body. The EU published proposals on Monday for reform of dispute settlement at the WTO that it has agreed with China, India and other countries, hoping to overcome U.S. objections voiced by President Donald Trump that have thrown the WTO into crisis. EU Trade Commissioner Cecilia Malmstrom said the bloc and Japan had tried in vain to introduce the topic in trilateral talks with the United States. “Lots of countries in the world are backing this. So please come, sit down and talk to us. That they haven’t done so far. Will that happen? Who knows,” Malmstrom told reporters on the sidelines of a trade conference in Brussels.

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The WTO is scrambling to develop a plan for the biggest reform in its almost 24-year history after Trump brought the world’s top trade court to the brink of collapse by blocking appointments of its judges and threatening a U.S. withdrawal. The EU is caught between the competing interests of the United States and China, currently engaged in a multi-billion dollar tariff conflict. Its trilateral talks with Japan and the United States have focused on a joint desire to change WTO rules to clamp down on market distortions, such as subsidies for stateowned firms and forced technology transfer, with China the clear target. “If we don’t reform this in the WTO - and we do not expect China to just sign on the dotted line here and agree, but to engage - there will be others setting a level playing field outside the WTO and I’m not sure that is beneficial for China or the rest of the world,” Malmstrom said. Washington, said Malmstrom, was at least taking part in discussion on this aspect of WTO reform. “It is constructive. They are not pretending. I think they think it’s meaningful,” she said, adding that trying to force China to change through a trade war with massive tariffs would not work. Malmstrom expressed hope that the G20 summit in Argentina on Friday and Saturday, when Trump and Chinese President Xi Jinping are to meet, would ease global trade tensions. “It would be good for the whole world if they de-escalated a little bit,” she said. “Then somehow it will have to be, possibly not in Buenos Aires but at some time, they will have to negotiate some way forward and we might not like those results, but I can’t speculate on that.”

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EU's Vestager tells China it is time to deliver on WTO reform Reuters (Reino Unido) European Competition Commissioner Margrethe Vestager urged China on Tuesday to work with the EU on reforming the World Trade Organisation (WTO), saying global support for free trade would erode if rules were not brought up to date. “We need to do more, we need to make it happen, the reform of the WTO,” Vestager told a conference in Hamburg attended by Chinese officials including Vice Premier Liu He. “Not just by discussing the easier issues, but making real progress on bringing rules up to date so global trade is fair as well as free,” Vestager added. In July, the EU and China agreed to set up a joint working group to discuss WTO reform.

II. NEGOCIAÇÕES REGIONAIS E BILATERAIS Trump warns Brexit agreement could threaten future US-UK trade deal CNBC (Estados Unidos) President Donald Trump on Monday warned that the agreement allowing Britain to leave the European Union could endanger a future U.S.-U.K. trade deal. His comments come at a time when British Prime Minister Theresa May is urgently looking to rally enough lawmakers to back her proposed Brexit deal in order to get it through Parliament in two weeks' time. A daunting task given the broad criticism it has received. Nonetheless, May has repeatedly insisted the terms in which the U.K. is set to leave the bloc at the end of March next year delivers for all of the British people.

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When asked about the agreement between Westminster and the EU's other 27 heads of state on Monday, Trump replied: "Sounds like a great deal for the EU." "I think we have to take a look seriously whether or not the U.K. is allowed to trade because right now if you look at the deal, they may not be able to trade with us," Trump told reporters outside the White House. "And that wouldn't be a good thing. I don't think they meant that," he added. In response, Downing Street said it is "very clear" Britain will be in a position to sign trade deals with countries around the world post-Brexit. Sterling falls The U.S. president seemed to suggest the current deal could potentially leave Britain unable to negotiate a free-trade agreement with the world's largest economy post-Brexit. Trump did not specify which provision of the deal he was worried about. The comments prompted sterling to fall against both the U.S. dollar and the euro Tuesday morning. Against the greenback, the U.K. currency slipped more than 0.5 percent to $1.2734, falling its lowest level in almost two weeks. It also slumped around 0.3 percent against a relatively weak euro to 88.65 pence. Under the deal secured with EU leaders on Sunday, Britain will divorce the bloc with continued close trade ties. But a deeply divided British parliament means May is left facing an uphill battle to get the deal approved on December 11. In response to Trump, a U.K. government spokesperson told CNBC Tuesday: "The political declaration we have agreed with the EU is very clear. We will have an independent trade policy so that the U.K. can sign trade deals with countries around the world — including with the U.S." "We have already been laying the groundwork for an ambitious agreement with the U.S. through our joint working groups, which have met five times so far. The U.S. Trade Representative also issued a call for views from the public on a future U.K.-U.S. free trade agreement earlier this month," they added.

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Investors Hope Trade Deals Are in G-20's Plan Bloomberg (Estados Unidos) As Argentina deals with airline, subway and bus strikes, Buenos Aires is preparing to host the G-20 summit beginning Thursday in the aftermath of soccer fan violence. While River Plate and Boca Juniors supporters are wishing a lot of bad things on each other and waiting for the cancelled game to be rescheduled, investors are bracing for trade talks among the world’s top leaders. The summit is likely to be a key one for risk assets, according to Edward Park, deputy chief investment officer at Brooks Macdonald, a London-based firm with more than 10 billion pounds in assets under management. Park sees the recent escalation in U.S. trade rhetoric towards China as part of the “maximum pressure” doctrine that President Donald Trump has been using in negotiations since the beginning of his presidency, citing the build-up to other deals such as United States-Mexico-Canada Agreement and an accord with North Korea as examples. After his party lost control of the House of Representatives in the midterm elections, the U.S. president will be keen to secure a big win and any progress in the negotiations is likely to have a positive impact on both Chinese and European manufacturing sectors. European industrials are still down 12% since the end of September after an aggressive sell-off, while autos & parts has been the European sector most affected by trade tensions. The deputy CIO believes that both parties have an interest in orchestrating a ceasefire. “China does not want escalating protectionism as it would have to abandon its economic realignment, while Trump does not want to be battling inflation in the U.S., with the monetary tightening it would probably provoke, when entering the 2020 election campaign,” Park wrote. Indeed, the other major event this Thursday will be the FOMC minutes. Recent dovish comments from Federal Reserve Chairman Jerome Powell have hinted at a pause in rising interest rates. Some further details about the Fed’s position about inflation will likely be

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as crucial as a smooth G-20 summit for financial markets. The Euro Stoxx 50 futures are down 0.2% ahead of the open, with mixed markets in Asia and U.S. futures lower.

III. OUTROS Bolsonaro se postula como el gran aliado estratégico de Trump en América Latina El País (Espanha) El presidente electo de Brasil, Jair Bolsonaro, se dispone a dar un giro histórico en las relaciones diplomáticas de su país con EE UU, marcadas durante las últimas décadas por un frío distanciamiento. El Gobierno, que toma posesión en enero, quiere convertirse en el principal aliado de Donald Trump en Sudamérica y en intermediario en las conversaciones con otros países de la región. El acercamiento a Washington empezará a tomar forma el jueves, con la visita del consejero de Seguridad Nacional de la Casa Blanca, John Bolton. El acercamiento que persigue Bolsonaro supone una revolución. Hay que volver al inicio de la dictadura militar (1964-1985) para encontrar un paso similar. Durante años el expresidente Luiz Inácio Lula da Silva promovió iniciativas regionales en el sur del continente, mientras los intereses económicos enfrentados en materia de comercio exterior e industria han mantenido a Brasil y EE UU alejados. Tradicionalmente, los países de América Latina que han buscado acercarse a Washington han sido Colombia o Argentina, que en los noventa hablaba de una “relación carnal” con EE UU, aunque durante el kirchnerismo también mantuvo una relación fría con la Casa Blanca. Un miembro del equipo de transición de Bolsonaro, que tiene acceso directo al futuro ministro de Exteriores brasileño, el trumpista y antiglobalización Ernesto Araújo, define que la estrategia consiste en ser el gran aliado de la Casa Blanca en la región. Bolsonaro intenta imitar Trump en al menos dos frentes: desea disminuir la influencia económica de China en Brasil e intensificar la relación con Israel, al transferir la embajada de Tel Aviv a Jerusalén. Pero, como en otras áreas, el futuro Gobierno envía señales contradictorias en 8

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política exterior. Hay una disputa entre los grupos más trumpistas y los militares más pragmáticos que temen represalias de Pekín, principal socio comercial de Brasil. Los países vecinos empiezan a adaptarse a los nuevos tiempos y se apresuran a tender contactos con el futuro Gobierno. Embajadores de los Gobiernos de Chile y Paraguay, además de representantes de Uruguay, Colombia, Ecuador, Argentina y Perú, se han reunido con el equipo de transición. “Solo Bolivia y Venezuela no han demostrado interés, al menos de momento”, afirma un miembro del futuro Gobierno. No hay ninguna sorpresa en el listado. Bolsonaro ha sido elegido con una ferviente retórica contra la izquierda y “anticomunista”, y no hay duda de que busca su inspiración en fórmulas ya utilizadas por otros líderes populistas de derechas. La visita de Bolton, que se reunirá con Bolsonaro en Río de Janeiro, es un claro gesto de EE UU. Oficialmente, la cita está programada para el día 29. Bolton quiere aprovechar su viaje a la cumbre del G20 en Argentina para hacer una breve parada en Brasil. La cita ha aumentado las esperanzas en los círculos bolsonaristas de que Trump acuda a la toma de posesión del presidente, el 1 de enero. Fuentes del equipo de transición consideran que hay posibilidades de que así sea. No existen precedentes recientes de la presencia de mandatarios de EE UU en un cambio de Gobierno en Brasil. Los bolsonaristas barajan la posibilidad de que asista al acto el primer ministro de Hungría, Viktor Orbán. El Parlamento europeo pidió en septiembre que se abriera un procedimiento sancionador contra el dirigente ultranacionalista por vulnerar los valores fundacionales de la UE. La semana pasada, en una llamada telefónica, le dijo a Bolsonaro que pretende ser “un gran compañero de Brasil”. Cumbre conservadora Antes de la ceremonia de investidura, Bolsonaro ya pretende poner a prueba su influencia. El 8 de diciembre promueve la Cumbre Conservadora de las Américas, en Foz de Iguazú, ciudad situada en la triple frontera entre Brasil, Argentina y Paraguay. Entre los participantes confirmados están José Antonio Kast, el ultraderechista que con 8% de los sufragios quedó en un inesperado cuarto lugar en las presidenciales chilenas; Orlando Gutiérrez, filósofo cubano exiliado en Estados Unidos; Jorge Jerez Cuéllar, general de la reserva colombiano, y el presidente destituido del Tribunal Supremo de Venezuela, Miguel Ángel Martín.

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“Brasil siempre tuvo influencia en la región”, considera el politólogo Ricardo Caldas, profesor de la Universidad Nacional de Brasilia. El analista Leonardo Barreto, de la consultora Factual, duda que algunas promesas —como debilitar Mercosur, reforzar la relación con Israel o salir de algunos acuerdos internacionales— se materialicen. Los primeros meses de 2019 mostrarán la diferencia entre el discurso y la práctica.

Trump-Style Foreign Policy Tantalizing Idea for Broke Brazil Bloomberg (Estados Unidos) Brazil’s next government wants an assertive, Trump-style foreign policy. It’s just not entirely sure how. In an interview with Bloomberg News, a senior member of President-elect Jair Bolsonaro’s

transition

government

sketched

out

lofty

intentions

to

cut

Brazil’s

dependency on China, boost its role in the Middle East and pressure the increasingly authoritarian government in Caracas. In comments that echoed some of President Donald Trump’s own talking points, the person criticized China’s unfair trade advantages and pledged a tougher line on Venezuela. But there are a few obstacles to those ambitions. China is Brazil’s top trading partner. Venezuela’s crisis offers no easy answers. And deepening ties with Israel, by moving Brazil’s embassy from Tel Aviv to Jerusalem as Bolsonaro has proposed, risks jeopardizing Brazil’s relationship with Arab countries and the huge trade surplus that comes with it. With just over one month to go until the new government takes office, the future administration has yet to set out in detail how it intends to implement its foreign policy proposals. But the senior adviser said the next government will seek more opportunities for trade deals, particularly on a bilateral rather than multilateral basis. Under Bolsonaro, who won election on a hard-right platform, Brazil’s foreign office will also champion Christian values, the person said. Here are some of the thoughts being aired in the corridors of the transition government:

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Brazil should note that China is not a democracy, and does not have freedom of speech or enterprise. The Bolsonaro administration should reduce Brazil’s dependency on the Asian giant. Bolsonaro intends to move Brazil’s embassy in Israel from Tel Aviv to Jerusalem, bearing in mind that Israel is the Holy Land for millions of Evangelical Brazilians. Saudi Arabia’s attitude to Israel is admirable. There is a link between a decrease in terrorism in the West and new Trump-driven pro-Saudi approach. Brazil should toughen its stance on Venezuela and condemn China and Russia’s role in supporting the administration of President Nicolas Maduro

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