Brazil demanding bigger role in setting the world's agenda

McClatchy NewspapersNovember 11, 2008 

BRASILIA, Brazil — For years, critics said that Brazil was long on potential and short on performance. Not anymore. This massive country has become one of the world's biggest democracies and an economic powerhouse.

Now Brazilian President Luiz Inacio Lula da Silva wants his nation to have a bigger role in world affairs. He'll press his case when leaders from the major industrial and developing nations convene Saturday at the G-20 summit in Washington.

Before the meeting, Lula has called on wealthier nations to overhaul the global finance system and give a bigger say to developing countries such as Brazil.

"We need new, more inclusive governance, and Brazil is ready to face up to its responsibilities," Lula said last Saturday at a meeting of finance ministers and central bank presidents in Sao Paulo. "It is time for a pact between governments to build a new financial architecture for the world."

In the short term, Brazil wants the smaller G-7 group of industrialized countries to expand to include Brazil and other developing countries, said Amaury de Souza, a political analyst in Rio de Janeiro.

"We want a permanent G-14," de Souza said, saying that Russia, China, Mexico and India should be among the additions.

Brazil also wants developing nations to have a greater voice at the International Monetary Fund, the World Bank and the United Nations.

"Global power structures were frozen in the aftermath of World War II," de Souza added. "Excessive latitude of action was given to European countries."

Only a few years ago, Brazil's president wouldn't have dared to demand a greater role. Hyperinflation, a roller-coaster economy and political instability plagued Brazil in the 1990s.

The country's stock market plummeted after Lula was elected in 2002. Investors feared the longtime leftist leader, a former auto factory worker who hadn't graduated from high school.

However, Lula has promoted business investment while putting more money into the hands of the poor. The economy has boomed for three years, propelling millions of Brazilians into the middle class.

With the world's 10th biggest economy, Brazil has surpassed the United States as the biggest producer of iron ore and coffee. It's become the world's biggest exporter of beef, poultry, biofuels and orange juice concentrate, and is rapidly gaining in soybeans, corn and pork.

Brazil also has accumulated $200 billion in foreign reserves, almost as much as the rest of Latin America combined. That money will help cushion the global meltdown

Now, Brazil wants to be recognized for its fiscal track record and to avoid the risks that come with a global economic crisis.

"Brazil has new standing in the world," said Rubens Barbosa, a private consultant in Brazil who's served as the ambassador to the United States. "We think we can contribute more."

Quietly, Brazil already has become the most powerful country in Latin America.

Brazilian companies are expanding Caracas' subway system, constructing a massive hydroelectric dam in Ecuador and building a highway in Peru that will give Brazilian companies better access to Peru's ports.

Brazil also has been flexing its diplomatic muscles throughout Latin America and the Caribbean. It leads the main United Nations peacekeeping mission in Haiti, where it has 1,200 soldiers.

Without fanfare, Lula has undercut the ambitions of Venezuelan President Hugo Chavez in South America, providing an important counterweight in the eyes of U.S. policymakers.

Lula has undermined Chavez's dreams of building a 5,000-mile gas pipeline connecting Venezuela and Brazil and has stymied Chavez's plan for the Bank of the South, meant to provide an alternative to the World Bank.

Now Brazil wants a reward for all its efforts.

"Brazilians view the current economic crisis as something of an opportunity," said Jeffrey Cason, a political science professor and Brazil expert at Middlebury College in Vermont. "They think they can increase the interest of developed nations in giving them a seat at the table and place Brazil in a leadership position on behalf of poor countries."

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McClatchy Newspapers 2008

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