[Senate Hearing 118-50]
[From the U.S. Government Publishing Office]
S. Hrg. 118-50
THE FUTURE OF U.S.-BRAZIL RELATIONS
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON FOREIGN RELATIONS
UNITED STATES SENATE
ONE HUNDRED EIGHTEENTH CONGRESS
FIRST SESSION
__________
MARCH 15, 2023
__________
Printed for the use of the Committee on Foreign Relations
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Available via http://www.govinfo.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
52-837 PDF WASHINGTON : 2023
COMMITTEE ON FOREIGN RELATIONS
ROBERT MENENDEZ, New Jersey, Chairman
BENJAMIN L. CARDIN, Maryland JAMES E. RISCH, Idaho
JEANNE SHAHEEN, New Hampshire MARCO RUBIO, Florida
CHRISTOPHER A. COONS, Delaware MITT ROMNEY, Utah
CHRISTOPHER MURPHY, Connecticut PETE RICKETTS, Nebraska
TIM KAINE, Virginia RAND PAUL, Kentucky
JEFF MERKLEY, Oregon TODD YOUNG, Indiana
CORY A. BOOKER, New Jersey JOHN BARRASSO, Wyoming
BRIAN SCHATZ, Hawaii TED CRUZ, Texas
CHRIS VAN HOLLEN, Maryland BILL HAGERTY, Tennessee
TAMMY DUCKWORTH, Illinois TIM SCOTT, South Carolina
Damian Murphy, Staff Director
Christopher M. Socha, Republican Staff Director
John Dutton, Chief Clerk
(ii)
C O N T E N T S
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Page
Menendez, Hon. Robert, U.S. Senator From New Jersey.............. 1
Risch, Hon. James E., U.S. Senator From Idaho.................... 3
Nichols, Hon. Brian, Assistant Secretary of State, Western
Hemisphere
Affairs, U.S. Department of State, Washington, DC.............. 4
Prepared Statement........................................... 6
Duke, Richard, Deputy Special Presidential Envoy for Climate,
U.S. Department of State, Washington, DC....................... 7
Prepared Statement........................................... 9
Additional Material Submitted for the Record
Responses of Mr. Brian Nichols to Questions Submitted by Senator
Robert Menendez................................................ 28
Responses of Mr. Brian Nichols to Questions Submitted by Senator
Marco Rubio.................................................... 29
Responses of Mr. Brian Nichols and Mr. Richard Duke to Questions
Submitted by Senator John Barrasso............................. 34
Responses of Mr. Richard Duke to Questions Submitted by Senator
Brian Schatz................................................... 35
Responses of Mr. Brian Nichols to Questions Submitted by Senator
Bill Hagerty................................................... 36
(iii)
THE FUTURE OF U.S.-BRAZIL RELATIONS
----------
WEDNESDAY, MARCH 15, 2023
U.S. Senate,
Committee on Foreign Relations,
Washington, DC.
The committee met, pursuant to notice, at 10:39 a.m., in
room SD-419, Dirksen Senate Office Building, Hon. Robert
Menendez presiding.
Present: Senators Menendez [presiding], Cardin, Shaheen,
Murphy, Kaine, Van Hollen, Risch, Young, Hagerty, and Ricketts.
OPENING STATEMENT OF HON. ROBERT MENENDEZ,
U.S. SENATOR FROM NEW JERSEY
The Chairman. This hearing of the Senate Foreign Relations
Committee will come to order.
Consider the following. After a fractious election cycle,
the defeated yet dangerous demagogue spews lies about election
fraud. He urges his supporters to reject reality, inciting them
to commit a violent attack on government buildings just a few
days into the start of the new year.
The shocking images of the insurrection are then broadcast
all over the world, a stark example of how even the strongest
democracies can falter when they are pushed to their limit.
If you are listening to this and wondering which
insurrection is he referring to, then I have made my point.
Similarities between the January 6 assault on the U.S. Capitol
and its Brazilian sequel on January 8 of this year reminds us
that we must stand vigilant against anyone anywhere who
corrodes democratic norms, even when those attacks come from
the highest levels of government.
For just as we know who was responsible for instigating the
attacks on the very institution in which we hold this hearing,
we know that former President Jair Bolsonaro, through his lies
and disinformation, fomented the attacks on Brazil's democracy.
Democracies are resilient only as long as we reinforce
their resiliency. We must look inward, commit to our own
democratic values, and continue to stand with democratic
movements and institutions throughout the world, which brings
us to today's hearing.
Despite the painful bond of these horrific attacks, the
United States and Brazil have a unique opportunity for renewed
cooperation. From addressing democratic challenges to
protecting the environment to the regional migration crisis, we
must succeed together or we will fail apart.
On the environment, in the span of about 2 years while
Bolsonaro was in charge human development ravaged more than
34,000 square miles of Brazil's Amazon rainforest, an area
roughly the size of South Carolina.
The astronomical damage inflicted lasting harm to the
ecosystem, to biodiversity, and to our efforts to combat global
climate change. Without drastic measures to reverse Bolsonaro's
actions, the lungs of the earth could become a net emitter,
preventing us from addressing catastrophic climate change.
Make no mistake, Brazilians are fighting for the Amazon,
but under Bolsonaro that proved hazardous in and of itself,
particularly for indigenous populations.
In 2021 alone, invasions of and attacks on indigenous
communities increased nearly threefold to more than 300
documented cases. That same year 176 indigenous people were
murdered for their activism to protect their homeland, the
highest numbers ever recorded.
Brazil under Bolsonaro was one of the deadliest places for
environmental defenders in the world, which is why I am
heartened that President Lula has made restarting Amazon
conservation and protecting environmental defenders a top
priority and the United States stands ready to support these
steps.
Last Congress I introduced the bipartisan Amazon 21 Act,
crucial legislation that rewards both conservation goals and
economic competitiveness. Addressing climate change while
promoting positive economic growth are not mutually exclusive,
and I look forward to once again engaging in that effort this
Congress.
After all, it is only by working with our partners,
particularly those in our own hemisphere, that we can combat
climate change, mitigate damage to the ecosystem, protect
environmental defenders, and spur economic growth.
Protecting environmental defenders is about much more than
just the Amazon. Organized civil society and the ability of
citizens to hold their government accountable are bedrocks of a
functioning democracy.
Given Brazil's important economic and geostrategic role, we
must be partners as we address democratic backsliding across
the Americas. We must defend democracy when it is under attack
around the world.
In Havana, Miguel Diaz-Canel continues to lock up hundreds
of protesters.
In Caracas, the Maduro regime is under investigation for
crimes against humanity.
In Managua, U.N. experts have said that Daniel Ortega's
reign of terror has perpetuated ``Nazi style crimes.''
These human rights abuses and the migratory outflows that
stem from citizens fleeing these countries demand our full
attention in cooperation. It also means that our countries must
stand shoulder-to-shoulder with the people of Ukraine in the
face of Putin's unjustified war.
The time is now for a U.S.-Brazilian partnership that leads
the way on environmental, economic, and democratic issues.
Next month, I look forward to leading a CODEL to Brazil
where we will solidify these ties as we hopefully meet with
President Lula and the senior members of his government. We
look forward to that.
Now let me turn to the ranking member, Senator Risch, for
his remarks.
STATEMENT OF HON. JAMES E. RISCH,
U.S. SENATOR FROM IDAHO
Senator Risch. Thank you, Mr. Chairman.
The United States has an enduring interest in our
prosperous, democratic, and stable Western Hemisphere. Strong
relations with Brazil are important to attain these goals.
Next year, we will celebrate 200 years of diplomatic
relations. The Administration should seize this moment with a
bold bilateral agenda. Such an agenda should include deepening
our security and commercial relations, working with Brazil
against malign state and nonstate influences, and encouraging
Brazilian support for the Organization of American States.
Like other emerging economies in Latin America, Brazilians
have benefited enormously from the international norms and
institutions which were created, led by us at the end of World
War II.
These norms and institutions have helped Brazil become a
top destination for U.S. foreign direct investments, which are
crucial to the stability and prosperity of the country.
At the same time, Brazil has drawn increasing attention
from malign foreign influences such as China, Russia, and Iran.
The Brazilian people should ensure their sovereignty and
freedoms are not compromised by these malign actors.
There is deep concern about President de Silva's recent
decision to welcome two sanctioned Iranian warships into
Brazilian ports. More importantly, President Biden should have
canceled his meeting with President de Silva.
I am disturbed by reports that the President instead just
asked them to move the port visit until after their meeting. I
was also disappointed President de Silva turned down Germany's
request for ammunition Ukraine needs to defend its sovereign
territory against the unprovoked Russian invasion and
occupation.
We should also remember that while the title of this
hearing focuses on Brazil, there are many other challenges in
the Western Hemisphere. The illegal immigration and the illicit
narcotics trafficking crisis at our Southwest border are
relentless. The Administration's response is to waste
taxpayers' money abroad and weaken enforcement of immigration
laws at home.
Venezuela is an unabated disaster. Last week marked 1 year
since Ambassador Story and White House officials sat down with
Maduro to find accommodation with the regime.
The results have included pardoned corrupt criminals,
division among democratic forces, and legitimacy for Maduro,
but no progress on restoring democracy in that country.
Colombia, for the first time in two decades, has failed to
eradicate a single hectare of coca. Seizures of heroin and
cocaine have dramatically fallen while their production has
increased.
Haiti has no constitutional government, faces growing
levels of violence, and is the epicenter of a migration crisis
overwhelming communities in Florida. The Administration's
response is to wait for Canada to take the lead.
I look forward to hearing from Ambassador Nichols on the
Administration's approach to these issues and our relations
with Brazil, more broadly.
Thank you for the witnesses. Thank you, Mr. Chairman.
The Chairman. Thank you, Senator Risch.
Let me turn to our witnesses.
It is an honor introduce Assistant Secretary Brian Nichols,
heads the Bureau of Western Hemisphere Affairs at the
Department of State. Assistant Secretary Nichols previously
served as U.S. Ambassador to Zimbabwe and Peru as well as
Principal Deputy Assistant Secretary of State for International
Narcotics and Law Enforcement. We look forward to hearing from
you today.
We are also joined by Deputy Special Envoy for Climate
Richard Duke. Mr. Duke previously served as Special Assistant
to President Obama and Deputy Assistant Secretary of the
Department of Energy. He has also worked at NRDC, McKinsey, and
Brookings.
Welcome to you both. Your full statements will be included
in the record without objection. I would ask you to try to
summarize your statements in about 5 minutes or so so the
members of the committee can have a conversation with you.
Before I ask you to start, Secretary Nichols, let me offer
a warm welcome to the Brazilian charge d'affaires, Bernardo
Velloso. Thank you for joining us as well.
With that, Mr. Secretary, you are recognized.
STATEMENT OF THE HONORABLE BRIAN NICHOLS, ASSISTANT SECRETARY
OF STATE, WESTERN HEMISPHERE AFFAIRS, U.S. DEPARTMENT OF STATE,
WASHINGTON, DC
Mr. Nichols. Thank you, Mr. Chairman.
Chairman Menendez, Ranking Member Risch, distinguished
members of the committee, thank you for the opportunity to
discuss our relationship with Brazil.
As the world's seventh most populous country and 12th
largest economy, Brazil is a global actor and strategic partner
with whom we work closely to advance shared priorities.
President Biden and President Lula reaffirmed our vital and
enduring partnership during their February 10 meeting at the
White House. Nine Cabinet officials joined the presidents,
reflecting the breadth and depth of our bilateral relations.
The two presidents agreed that strengthening democracy,
protecting human rights, and addressing the climate crisis
would anchor our shared agenda.
The troubling events in Brasilia on January 8 highlighted
the threats that polarization and misinformation pose even for
established democracies.
President Biden, Secretary Blinken, and I quickly and
forcefully condemned that day's violent attacks. In their
February 10 meeting both presidents condemned political
extremism and violence, hate speech, and disinformation. They
agreed to work together to address these challenges, including
through this month's second Summit for Democracy.
The United States and Brazil will continue working together
to advance human rights at home and abroad. President Biden and
President Lula committed to reinvigorate the U.S.-Brazil Joint
Action Plan to Eliminate Racial and Ethnic Discrimination and
promote equality, known as JAPER, to promote the human rights
and well-being of marginalized racial and ethnic communities,
including indigenous people and people of African descent in
both countries.
We anticipate productive conversations on these subjects
during the upcoming human rights dialogue and technical level
meetings on JAPER.
Home to 30 percent of the world's tropical rainforests,
Brazil plays a vital role in addressing the climate crisis. The
Biden-Harris administration stands ready to support President
Lula's commitments to advance environmental protection and
sustainable development.
President Biden and President Lula intend to work together
to enhance global food security. Brazil's status as the world's
largest agricultural net exporter and one of the largest
fertilizer importers makes it an important partner in our
efforts to address food security challenges we now face.
Both our governments are interested in expanding trade and
investment in developing supply chain resiliency. The United
States is by far Brazil's largest foreign investor, and Brazil
represents a top export market for the United States, receiving
nearly $47 billion in U.S. goods in 2021.
U.S. Trade Representative Ambassador Katherine Tai's trip
earlier this month reinforced our desire to grow bilateral
trade in line with our shared values.
Under Secretary of State for Economic Growth, Energy, and
the Environment Jose Fernandez will similarly engage with
Brazilian Government officials and private sector leaders later
this month to discuss trade, critical minerals, agriculture,
and clean energy.
We work closely with Brazil in multilateral fora including
in the United Nations Security Council where Brazil serves as
an elected member through the end of 2023. We expect Brazil
will remain a committed leader in the U.N. on humanitarian
issues, peacekeeping operations, and efforts to promote
international peace and security.
Brazil will also serve as G-20 president in 2024. We know
we must work diligently to keep the relationship strong and
pull together on tough issues facing the world. President Lula
places an emphasis on South-South cooperation and seeks to
position Brazil as a leading voice for peace, including in
Ukraine.
The Russian Federation is solely responsible for the war in
Ukraine. However, we welcome all genuine efforts to secure a
comprehensive, just, and lasting peace in Ukraine based on the
U.N. Charter's principles.
Brazil voted in favor of the February 23 U.N. General
Assembly Resolution demanding Russia's immediate withdrawal
from Ukraine and we look forward to continued cooperation to
address the dire human rights and humanitarian consequences of
Russia's war.
We understand our countries will not always see eye-to-eye
and Brazil as a sovereign nation makes its own foreign policy
decisions. We conveyed our consternation that Brazil recently
hosted two Iranian naval vessels beginning February 28,
emphasizing the Iranian regime's brutal suppression of its own
people, provision of weapons to Russia, and destabilizing
activities around the world.
We will continue to engage with our Brazilian partners to
discourage cooperation with malign actors, including Iran.
In conclusion, the Biden-Harris administration is committed
to working diligently to ensure U.S.-Brazilian relations remain
strong and productive for the benefit of U.S. citizens, the
Brazilian people, and the world.
Next year we will celebrate 200 years of bilateral
relations and we are confident that our partnership will
continue to thrive for many generations to come.
[The prepared statement of Mr. Nichols follows:]
Prepared Statement of Mr. Brian Nichols
Chairman Menendez, Ranking Member Risch, distinguished members of
the Committee, thank you for the opportunity to discuss our
relationship with Brazil. As the world's seventh-most populous country
and 12th-largest economy, Brazil is a global actor and strategic
partner with whom we work closely to advance shared priorities.
President Biden and President Lula reaffirmed our vital and
enduring partnership during their February 10 meeting at the White
House. Nine cabinet officials joined the presidents, reflecting the
breadth and depth of our bilateral relations. The two presidents agreed
that strengthening democracy, protecting human rights, and addressing
the climate crisis would anchor our shared agenda.
The troubling events in Brasilia, on January 8, highlighted the
threats that polarization and misinformation pose, even for established
democracies. President Biden, Secretary Blinken, and I quickly and
forcefully condemned that day's violent attacks. In their February 10
meeting, both presidents condemned political extremism and violence,
hate speech, and disinformation. They agreed to work together to
address these challenges, including through this month's second Summit
for Democracy.
The United States and Brazil will continue working together to
advance human rights at home and abroad. President Biden and President
Lula committed to reinvigorate the U.S.-Brazil Joint Action Plan to
Eliminate Racial and Ethnic Discrimination and Promote Equality, known
as JAPER, to promote the human rights and wellbeing of marginalized
racial and ethnic communities, including Indigenous people and people
of African descent, in both countries. We anticipate productive
conversations on these subjects during the upcoming Human Rights
Dialogue and technical-level meetings on JAPER.
Home to 30 percent of the world's tropical rainforests, Brazil
plays a vital role in addressing the climate crisis. The Biden-Harris
administration stands ready to support President Lula's commitments to
advance environmental protection and sustainable development.
President Biden and President Lula intend to work together to
enhance global food security. Brazil's status as the world's largest
agricultural net exporter and one of the largest fertilizer importers
makes it an important partner in our efforts to address the food
security challenges we now face.
Both our governments are interested in expanding trade and
investment and developing supply chain resiliency. The United States is
by far Brazil's largest foreign investor, and Brazil represents a top
export market for the United States, receiving nearly $47 billion
dollars in U.S. goods in 2021. U.S. Trade Representative Ambassador
Katherine Tai's trip earlier this month reinforced our desire to grow
bilateral trade, in line with our shared values. Under Secretary of
State for Economic Growth, Energy, and the Environment Jose Fernandez
will similarly engage with Brazilian Government officials and private
sector leaders later this month to discuss trade, critical minerals,
agriculture, and clean energy.
We also work closely with Brazil in multilateral fora, including in
the UN Security Council, where Brazil serves as an elected member
through the end of 2023. We expect Brazil will remain a committed
leader in the UN on humanitarian issues, peacekeeping operations, and
efforts to promote international peace and security. Brazil will also
serve as G20 president in 2024.
We know we must work diligently to keep the relationship strong and
to pull together on the tough issues facing the world. President Lula
places an emphasis on South-South cooperation and seeks to position
Brazil as a leading voice for peace, including in Ukraine. The Russian
Federation is solely responsible for the war in Ukraine. However, we
welcome all genuine efforts to secure a comprehensive, just, and
lasting peace in Ukraine, based on the UN Charter's principles. Brazil
voted in favor of the February 23 UN General Assembly resolution
demanding Russia's immediate withdrawal from Ukraine, and we look
forward to continued cooperation to address the dire human rights and
humanitarian consequences of Russia's war.
We understand our countries will not always see eye-to-eye--and
Brazil, as a sovereign nation, makes its own foreign policy decisions.
We conveyed our consternation that Brazil recently hosted two Iranian
naval vessels beginning February 28, emphasizing the Iranian regime's
brutal suppression of its own people, provision of weapons to Russia,
and destabilizing activities around the world. We will continue to
engage with our Brazilian partners to discourage cooperation with
malign actors including Iran.
In conclusion, the Biden-Harris administration is committed to
working diligently to ensure U.S.-Brazilian relations remain strong and
productive, for the benefit of U.S. citizens, the Brazilian people, and
the world. Next year, we will celebrate 200 years of bilateral
relations, and we are confident that our partnership will continue to
thrive for many generations to come.
Once again, thank you for the opportunity to appear before you
today. I welcome your questions.
The Chairman. Thank you.
Mr. Duke.
STATEMENT OF RICHARD DUKE, DEPUTY SPECIAL PRESIDENTIAL ENVOY
FOR CLIMATE, U.S. DEPARTMENT OF STATE, WASHINGTON, DC
Mr. Duke. Chairman Menendez, Ranking Member Risch, thank
you for the opportunity today to provide more detail about our
engagement with Brazil on climate issues.
Assistant Secretary Nichols already outlined the global
importance of Brazil in the range of our strategic cooperation.
I will focus on how cooperation on climate change fits within
these strategic priorities.
In addition to being the world's seventh most populous
country, Brazil is the sixth largest emitter of greenhouse
gases globally. Due to its abundant hydropower resources,
renewable power supplies nearly four-fifths of its electricity
and has a clean energy economy, relatively speaking, already.
As the world's third largest exporter of agricultural
products, Brazil has significant agricultural-related
emissions, but the largest source of emissions comes from the
loss of forests and other carbon-rich ecosystems.
The Amazon rainforest plays a critical role in the
regulation of global climate, not to mention its importance for
the millions of people that live within the region and the
unique biodiversity found only in this biome.
It covers almost 2.8 million square miles and stores over
120 billion metric tons of carbon, equivalent to more than a
decade of global energy sector emissions. Sixty percent of the
Amazon rainforest falls within Brazil's territory. This land
and its resources are unquestionably Brazilian.
The risks posed by Amazon forest loss have global
implications. Deforestation rates in the Brazilian Amazon have
soared over the past 4 years as speculators cleared forests to
claim land, ranchers expanded pasture, and illegal loggers and
miners encroached into protected areas and indigenous
territories.
Scientists fear that the Amazon rainforest is nearing a
tipping point where natural tree die off accelerates and the
Amazon no longer naturally regenerates, turning it into a net
source of emissions.
The implications would be catastrophic for the climate,
also catastrophic for agricultural production and global food
security, which depends on rainfall patterns regulated by the
Amazon.
It would affect the livelihoods of more than 25 million
people who live in the Brazilian Amazon, including hundreds of
thousands of indigenous peoples who have conserved the forest
for millennia. It would also cause an unprecedented loss of
biodiversity.
Any successful conservation approach must create value for
healthy ecosystems so that people who depend on them benefit
from standing forests more so than from deforestation.
On February 10 in Washington, Presidents Biden and Lula
instructed the U.S.-Brazil Climate Change Working Group to
reconvene promptly.
During his recent trip to Brazil, Special Presidential
Envoy for Climate John Kerry and Minister of Environment and
Climate Marina Silva identified key areas for engagement,
focusing on deforestation, the bioeconomy, low-emissions
agriculture, as well as clean energy and resilience.
The truth is we cannot fail. We cannot fail because of
Brazil's importance for the global climate, food security, and
biodiversity, but we also cannot fail because of the importance
of our strategic partnership with Brazil.
The United States has worked for decades to create a closer
relationship with Brazil. This eroded over the last few years
and at the same time the role of the PRC has been in
ascendance.
The People's Republic of China is currently Brazil's
largest trade partner and the largest market for many Brazilian
commodities. It is also the largest investor in infrastructure
projects in Brazil, and the PRC has invested in building strong
relationships with Brazilian legislators and other leaders.
There is a strong pro-China constituency in the country,
but the Lula administration is committed to a close working
relationship with the United States across a range of issues.
The United States is the second largest trading partner and
the largest source of foreign direct investment in Brazil, and
Brazil has a strong cultural affinity with the United States,
creating opportunities for closer political ties.
To achieve this, we need to ensure that funding flows to
support Brazil's priorities--conserving forests, building a
strong bioeconomy and transitioning to productive and low-
emission agriculture and clean energy.
We also have the opportunity to work with a range of
partners--government, private sector, multilateral, and
philanthropic--to bring support for Brazil's forests and
climate efforts. We see the Amazon Fund with its results-based
approach and mobilizing private sector investment for Brazil's
deforestation as key.
This is a must-succeed year for the Amazon and for Brazil.
Brazil has asked us to step up and be a strategic partner in
their efforts. This is a request we cannot ignore for the
climate, for the people of Brazil, and for the future of one of
the world's largest democracies.
Thank you again for the opportunity to testify today.
[The prepared statement of Mr. Duke follows:]
Prepared Statement of Mr. Richard Duke
Chairman Menendez, Ranking Member Risch, distinguished members of
the Committee, thank you for the opportunity today to provide more
detail about our engagement with Brazil on climate change issues.
Assistant Secretary Nichols already outlined the global importance of
Brazil, and the range of our strategic cooperation. I will focus on how
cooperation on climate change fits within these strategic priorities.
In addition to being the world's seventh-most populous country,
Brazil is the sixth largest emitter of greenhouse gases in the world.
Due to its abundant hydropower resources, renewable sources supply
nearly four-fifths of its electricity. As the world's third-largest
exporter of agricultural products, Brazil has significant agriculture-
related emissions. The largest source of emissions come from the loss
of forests and other carbon-rich ecosystems.
The Amazon rainforest plays a critical role in the regulation of
global climate--not to mention its importance for the millions of
people that live within the region, and the unique biodiversity found
only in this biome.
It covers almost 2.8 million square miles and stores an estimated
123 billion metric tons of carbon, equivalent to more than a decade of
global energy sector emissions.
Sixty percent of the Amazon rainforest falls within Brazil's
territory. This land, and its resources, are unquestionably Brazilian,
but the risks posed by Amazon forest loss have global implications.
Deforestation rates in the Brazilian Amazon have soared over the
past 4 years as speculators cleared forests to claim land, ranchers
expanded pasture, and illegal loggers and miners encroached into
protected areas and Indigenous territories.
Scientists fear the Amazon rainforest is nearing a tipping point,
where natural tree die off accelerates and the Amazon no longer
naturally regenerates, turning the Amazon into a net source of
emissions. The implications would be catastrophic for the climate. It
would also be catastrophic for agricultural production and global food
security, which depends on rainfall patterns regulated by the Amazon.
It would affect the livelihoods of the more than 25 million people who
live in the Brazilian Amazon--including the hundreds of thousands of
Indigenous Peoples who have conserved the forests for millennia. It
could also cause an unprecedented loss of biodiversity.
Any successful conservation approach must create value for healthy
ecosystems, so that the people who depend on them benefit from standing
forests more than from deforestation.
On February 10 in Washington, Presidents Biden and Lula instructed
the U.S.-Brazil Climate Change Working Group to reconvene promptly.
During his trip to Brazil, Special Presidential Envoy for Climate John
Kerry and Minister of Environment and Climate Marina Silva identified
key areas for engagement, focusing on deforestation, the bioeconomy,
low emissions agriculture, as well as clean energy and resilience.
The truth is, we cannot fail. We cannot fail because of Brazil's
importance for the global climate, food security, and biodiversity. But
we also cannot fail because of the importance of our strategic
relationship with Brazil.
The United States has worked for decades to create a closer
relationship with Brazil. This relationship eroded over the last few
years, and at the same time, the role of the PRC has been in
ascendance. The PRC is currently Brazil's largest trade partner, and
the largest market for many Brazilian commodities. It is also the
largest investor in infrastructure projects. The PRC has invested in
building strong relationships with Brazilian legislators and other
leaders, and there is a strong pro-China constituency in the country.
But the Lula administration is committed to a close working
relationship with the United States across a range of issues. The
United States is the second-largest trading partner for Brazil, and
largest source of foreign direct investment. Brazil has a strong
cultural affinity with the United States, creating opportunities for
even closer political ties.
To achieve this, we need to ensure that funding flows to support
Brazil's priorities: conserving forests, building a strong bioeconomy,
and transitioning to low emission agriculture and clean energy.
We also have the opportunity to work with a range of partners--
government and private sector, multilateral and philanthropic--to bring
significant support for Brazil's forest and climate efforts. We see the
Amazon Fund and mobilizing private sector investment for Brazil's
deforestation efforts as key.
This is a must-succeed year for the Amazon, and for Brazil. Brazil
has asked us to step up to be a strategic partner in their efforts.
This is a request we cannot ignore--for the climate, for the people of
Brazil, and for the future of one of the world's largest democracies.
Thank you again for the opportunity to testify today. I welcome any
questions.
The Chairman. Thank you both for your testimony. We will
start a round a 5-minute questioning.
As Brazil's institutions were under attack, the person
responsible for instigating these attacks was on vacation in
Florida. Former President Bolsonaro has been in the United
States since December. He is requesting a 6-month tourist visa
to extend his stay. At the same time he continues to spew
disinformation about Brazil's elections.
I raise the question, what does it say if the United States
is to provide safe haven to a foreign official responsible for
seeking to undermine democracy and free and fair elections
abroad?
Assistant Secretary Nichols, is the Biden administration
committed to swiftly reviewing any extradition requests for Mr.
Bolsonaro?
Mr. Nichols. It is a long-standing policy not to comment on
extradition matters. Certainly, we have a strong relationship
with Brazil and we will handle any request that we receive from
the Brazilian Government expeditiously.
The Chairman. Okay. Yes, I did not ask you how you are
going to decide. I asked you whether you--the Administration is
committed to doing it expeditiously because my understanding is
that the Lula government suggested they would like to see his
return to Brazil by the end of March. Do we have an extradition
request pending?
Mr. Nichols. Sorry, but we do not comment on whether or not
countries have submitted extradition requests, but if such a
request were received we would handle it expeditiously in
accordance with law.
The Chairman. We do not ever comment as to whether even a
request exists?
Mr. Nichols. Yes, Mr. Chairman.
The Chairman. We have to think about changing that because
it seems to me that it is difficult to make public policy if
you do not know what are at least the facts that are pending
before the government.
A key driver of deforestation in the Amazon is the
extractive industry and agricultural activities backed by
Chinese state-owned corporations.
Economic pressure to convert the Amazon is tremendous,
which is why the legislation that I introduced aims to
establish market-based values for forest conservation and offer
assistance based on the achievement of conservation results.
How important is it for the United States to help generate
economic value for conserving the Amazon, Mr. Duke?
Mr. Duke. Mr. Chairman, thank you for the question. We
share your concern about illegal activities in the Amazon and
indeed in global forest basins as a driver of deforestation and
would note that deforestation globally is one of the main
causes of climate change and we simply have to address it for
biodiversity reasons and to tackle climate change properly.
Part of that is making sure that we build on measures like
the Lacey Act that has helped to ensure that we have ways to
enforce against illegally harvested wood, and I will note that
we have engaged in the U.S. China-Glasgow Declaration with
China on that issue, pushing them to enforce their own laws
about illegally traded wood products from the Amazon or other
regions and we will continue to work on this agenda and welcome
the legislative proposals that you have put forward.
The Chairman. I appreciate enforcing laws to not violate
certain laws, whether they be in Brazil or here, but the
question is do we not need to establish some type of market-
based values for achievement of conservation results?
I mean, part of the challenge here is an economic one. Do
we not want to find some market-based value so that we can
ultimately help countries do what is in everybody's interest?
Mr. Duke. Thank you, Mr. Chairman.
We agree that it is crucial to support countries like
Brazil that seek to end deforestation and to create economic
opportunities for Government of Brazil and for the people that
live in the Amazon region of Brazil instead of illegal
activities like mining and deforestation.
The Chairman. How do we best do that?
Mr. Duke. We welcome the opportunity to work with Congress
on legislative approaches that properly resource that sort of
support and we are eager to also look to other countries, to
philanthropy, and to the private sector including through
carbon markets such as jurisdictional approaches to reducing
deforestation in order to support that objective that we very
much share with you.
The Chairman. All right.
I think we need some robust--I love the private sector and
I love private conservation efforts, but I am not sure we are
going to save the Amazon that way.
Finally, as the largest democracy in the region, Secretary
Nichols, I strongly believe that Brazil has a responsibility to
proactively engage and help ensure accountability where we see
it, not by my remarks, but by U.N. remarks, in the hemisphere,
about what is happening in Nicaragua and Venezuela, for
example.
In the past, President Lula has been reluctant to do so. I
hope he understands the critical role that Brazil can and
should play in upholding regional democratic values.
What is your assessment of this term now, President Lula's
willingness to play a role in addressing human rights
challenges in the region, especially in Cuba, Venezuela, and
Nicaragua?
Mr. Nichols. Thank you, Mr. Chairman. I wholeheartedly
agree.
The presidents, during their February 10 meeting, discussed
the importance of defense for democracy on a global level
during their meeting and recalled the threats that both of our
countries had faced.
The Administration will vigorously engage Brazil on issues
of democracy in our hemisphere and we look forward to
cooperating with them across various multilateral fora. We are
pleased that Brazil has voted with us on issues like condemning
Russia's brutal invasion of Ukraine in the U.N. General
Assembly.
We note the interest that President Lula has shown in
helping to address the challenges to democracy in this
hemisphere, particularly noting his interest in neighboring
Venezuela.
The Chairman. Okay.
Senator Risch.
Senator Risch. Thank you, Mr. Chairman.
The fact that there is no comment on extraditions is news
to me. I do not know if you have heard about that before, but
it seems to me there is robust discussion of that regularly in
the media.
I am surprised to hear that. I can understand where there
would be occasions where people would want to have
confidentiality or something, but as a blanket policy that
seems to me to be not appropriate. We maybe ought to get a
formal response where that is written down or something.
Ambassador Nichols, the first thing I want to ask about is
the two U.S.-sanctioned Iranian warships that were docked in
Brazil. What are you going to do about that?
Mr. Nichols. We shared--well, first of all, they have no
place in our hemisphere. The Iranians should not be here. They
have a horrific record on human rights. They support Putin's
illegal war in Ukraine.
We have raised the concerns about their presence with all
of the governments in the hemisphere, and the sovereign
decision of Brazil to allow the Makran and the Dena to dock in
February and their subsequent departure on March 4 was deeply
disappointing.
We will continue to discuss the importance of responding to
Iran's efforts to destabilize its neighbors, to export
violence, to oppress its own people, with all of our partners
around the hemisphere and I am sure this will be a robust part
of our conversations, not only with Brazil, but all the
countries in our region.
Senator Risch. I appreciate all those remarks, but the
question was what are you going to do about this. I mean, we
all know how bad Iran is and what they are doing. That is why
they were sanctioned in the first place.
We have sanctioned before on things like this. I mean, just
talking about it, what good--let me ask this, what good does
sanctioning do if you do not do anything about it when a
country like this takes the action it did?
Mr. Nichols. As you note, Senator, the two ships themselves
have been sanctioned. The United States does not discuss
sanctions designations before they take place, but we will look
at the facts carefully, going forward, and as I have noted, we
will continue to talk to all of our partners in the hemisphere
about the noxious role that Iran plays around the world.
Senator Risch. I guess if I was sitting in Iran I would say
the U.S. sanctioned us--so what. What do we care? I mean, this
is a joke. I mean, they put out sanctions and this is supposed
to mean something. Nothing happens.
We sailed into Brazil, we docked our ships, and business as
usual. It just seems to me that why bother doing this? In fact,
if anything, I think it undermines us by doing something like
this and then it not having any consequences.
Mr. Nichols. I note that every other country in the
hemisphere decided against receiving these ships----
Senator Risch. Fair point.
Mr. Nichols. --and that is not by accident. That is because
we engaged every other country in the hemisphere to talk about
the risks that Iran poses, and we continue to have that
conversation with our friends and partners in Brazil.
Senator Risch. That is a really good point, but it also
undermines or it underlines the fact that not taking any action
is an indication that we are not going to do anything about it.
If I was another country I would say well, look, the U.S.
asked them not to dock. If they would have docked here we could
have picked up a bunch of money and what have you.
We agreed with the U.S. and did not let them dock here, but
they went to Brazil and docked there and the U.S. did not do
anything about it--why should we do anything about it.
Mr. Nichols. We look forward to continuing our
conversations around this topic with all of our partners,
particularly with Brazil, and we have a number of high-level
visitors from the Administration going to Brazil.
I note that the chairman of this committee will also lead a
delegation in Brazil and I am sure there will be robust
opportunities to discuss the importance of keeping our
hemisphere free of the noxious Iranian influence.
Senator Risch. My time is short here, but let me just ask
briefly.
In January, Colombia halted eradication of illicit coca,
but seizures of heroin and cocaine have slowed down since
August. Is it your opinion that Colombia is abiding by its
counter narcotic obligations?
Mr. Nichols. We have a robust dialogue with the Government
of Colombia on counter narcotics and rule of law issues.
We believe that a holistic approach is vital in Colombia
and that approach should include interdiction, eradication,
alternative development opportunities, care for the environment
in rural areas, and opportunities to support rural livelihoods.
That process is ongoing. We have a high-level dialogue with
Colombia that will take place later this month and we will have
an opportunity to address those issues and how important it is
not just for the United States, but for our entire region that
strong cooperation on counter narcotics continue.
Senator Risch. That is good talk, but can you tell us why
Colombia halted eradication in January?
Mr. Nichols. President Petro said that he wished to
reevaluate the counter narcotics policies of preceding
administrations and as part of that reevaluation he wanted to
have a purely voluntary eradication policy.
Those discussions on how that would work are ongoing and we
believe that it is very difficult to succeed if there is no
downward pressure on cultivation and particularly before a
voluntary eradication program is up and running.
Senator Risch. It sure seems to me that it would be very
difficult to argue that there is not backsliding going on with
that very clear and simple thing that they were doing to
eradicate it. To just cease it sure seems like backsliding.
My time is up. Thank you, Mr. Chairman.
The Chairman. Thank you.
Senator Cardin.
Senator Cardin. Thank you, Mr. Chairman. Let me thank both
of our witnesses for their service to our country.
Brazil is certainly a very important strategic partner for
the United States. With the election of President Lula it
presents new opportunities. Certainly going to be a change in
direction in that country and the question is how do we deal
with the changes that are occurring in Brazil to improve our
strategic partnership with the country.
Secretary Nichols, let me start with a comment you made
complimentary of Brazil's vote in the United Nations in regards
to Ukraine, but the truth is that the Brazilians have not been
supportive of a lot of the sanction issues in regards to
Russia.
Go over with me where our strategy is to improve the
actions of Brazil to further isolate Russia in its brutal war
against Ukraine.
Mr. Nichols. The February 10 joint statement issued when
the two presidents met here in Washington unequivocally
condemned Russia's invasion of Ukraine. It talked about the
threat to food security that Russia's invasion has presented.
We continue to consult closely with Brazil in the United
Nations and secured Brazil's support for the February 28
resolution condemning Russia's invasion.
We have regular high-level engagement with our Brazilian
partners. Our ambassador to the United Nations, Linda Thomas-
Greenfield, will be traveling to Brazil in a few weeks to
discuss these issues with them and I also look forward to
visiting Brazil soon.
Senator Cardin. Let me sort of focus in on--it looks like
the importation of fertilizer from Russia has had an impact on
Brazilians' willingness to support our sanctions.
Are we looking at that, trying to provide a way in which we
can further isolate Russia?
Mr. Nichols. Absolutely, Senator.
We consult closely with Brazil on global food security
issues and we work with them and others on looking at
alternatives to the types of fertilizer imported from Russia,
whether it be seeds that require less fertilizer, whether it be
different types of fertilizers, and we believe that severing or
reducing that need for outside fertilizer is an important way
of strengthening Brazil and limiting the influence of Russia on
Brazil.
Senator Cardin. Let me just underscore the point that
Chairman Menendez made on the environment and the Amazon
because I totally agree that we have to be more aggressive in
providing incentives or alternatives on those who make their
livelihood that impact on the Amazon.
I want to spend my remaining 2 minutes on China. Brazil has
an incredible amount of partnerships with China today.
What is our game plan in order to try to minimize China's
influence in Brazil in our hemisphere? Where are we working to
get not just governmental activities, but private sector
activities that can counter what China is doing in these deals
that they present that are usually too good to be true and they
are really not true, but it does give them a foothold in these
countries?
Mr. Nichols. We continue to follow our invest-align-compete
strategy with regard to China globally. That means investing in
the United States, aligning our policies with key allies, and
competing to demonstrate that the offers that China puts on the
table are often false, lead to high debt, and do not deliver
the kinds of things that the PRC promises.
With regard to Brazil----
Senator Cardin. We hear that a lot, but unless there are
alternatives available for dealing with the needs, China
sometimes is the only player.
Mr. Nichols. Absolutely, Senator.
Among the things we are doing is continuing to leverage the
unprecedented levels of U.S. foreign direct investment in
Brazil. It was $200 billion last year.
We are using the Development Finance Corporation, Export-
Import Bank, USAID, the Inter-American Foundation as ways to
help promote alternatives to Chinese investment.
We are working on open radio access networks to compete
with Chinese 5G. We are directing investments towards a
critical minerals area to provide alternatives. I am happy to
discuss further areas because I think we are out of time.
Senator Cardin. Thank you. Thank you, Chairman.
The Chairman. Thank you. Senator Ricketts is next and then
Senator Shaheen is going to preside for a few minutes and I
will be back after that.
Senator Ricketts.
Senator Ricketts. Great. Thank you very much, Mr. Chairman,
and I thank both of you for attending here today and joining
us.
Obviously, this is a very important relationship. My state
of Nebraska, for example, is an agricultural state. We produce
a lot of soybeans.
Who else produces a lot of soybeans? Brazil, right. It is a
very important relationship for us.
Secretary Nichols, are territorial and integrity and
sovereignty key tenets of the U.N. Charter?
Mr. Nichols. Absolutely.
Senator Ricketts. Does the Biden administration support
Brazil's ascension to a permanent member status on the U.N.
Security Council, given its lack of support for Ukrainian
territorial integrity?
Mr. Nichols. The Government of Brazil voted in favor of the
U.N. General Assembly resolution condemning Russia's invasion
and also joined us in a statement when the two presidents met,
condemning it on February 10 as well.
The United States supports the modest expansion of elected
members to the U.N. Security Council. It is a conversation for
each region to have as to which countries those would be, but
we believe that an expanded Security Council can more
effectively represent global interests.
Senator Ricketts. Even though Brazil has come out and
condemned the invasion, they have not been exactly supportive,
right? They rebuffed the German chancellor's attempts to get
ammunition to be able to help Ukraine defend itself, correct?
Mr. Nichols. President Lula has met virtually with
President Zelensky and, again, Brazil has voted to condemn
Russia's invasion in the United Nations as well as some United
Nations specialized bodies.
The importance of working with Brazil on a whole host of
issues is crucial for the United States and right now Brazil is
a nonpermanent elected member of the Security Council until
next year, and we are working closely with them in that fora.
Senator Ricketts. Great. Thank you.
The Monroe Doctrine has been a cornerstone of U.S. foreign
policy for two centuries, warning other powers against
interfering in the Western Hemisphere, and over the last two
decades what we have seen is China has been allowed extensive
access to tighten its grip across Latin America, including
Brazil.
By the end of President Lula's first presidency in 2010,
Brazil-China trade had gone up from virtually none to $60
billion and in 2009 China became Brazil's top trading partner.
Brazil received a record deal of $7 billion from the China
Development Bank for offshore development.
In the decades since, China-Brazil economic ties have
transformed and, in fact, Brazil accounts for 47 percent of
China's foreign direct investment in Latin America, totaling
more than $66 billion in 2010.
There are obvious concerns that China will continue to
leverage these economic ties to expand influence in the region.
Earlier this month the United States Trade Representative
Katherine Tai visited Brazil where she emphasized the improving
labor rights and environmental protections as common areas--
interest and common areas for the United States.
However, there seems to be little interest from the
Administration negotiating far more ambitious trade agreements
for making significant investments.
Secretary Nichols, is the Biden administration doing enough
to discourage countries like Brazil from pursuing investments
from China and seeking trade with China? Should we be doing
more to be able to develop that relationship?
Mr. Nichols. We are focused on demonstrating that the U.S.
is the best partner for the countries around the region,
particularly Brazil. The United States is the largest source of
foreign direct investment in Brazil, providing high-quality job
opportunities and growth for the benefit of both of our
peoples.
We see around the hemisphere that the promises that the PRC
makes about the quality of its investments, about the debt
associated with its investments, are false.
I have been to numerous countries in this hemisphere and
have people point out to me stadiums with problems in their
construction, buildings with problems, highways that are
falling apart, and hidden debts that countries did not know
that they were going to have to assume that are crushing the
budgets.
Telling the stories of these experiences and bringing
others together to say, hey, you took this deal from China.
Tell your neighbor what your experience was. I think that makes
a very compelling case.
Obviously, Brazil is a sovereign country and they can make
their own decisions, but I think we are putting on the table
the kind of financing, the kind of investment, that will help
both of our nations prosper and provide a reliable transparent
alternative to what the PRC has on an offer.
Senator Ricketts. Are you concerned about what the PRC is
doing, though, with regard to Latin America and Brazil?
Mr. Nichols. Absolutely, and I thank this body for the
resources that you have recently appropriated to help us
compete even more strongly against the PRC.
Senator Ricketts. Great. Thank you, Secretary Nichols.
Appreciate it.
Senator Shaheen [presiding]. Thank you, Senator Ricketts,
and thank you both for your testimony this morning.
I want to follow up both Senator Ricketts' and Senator
Cardin's questioning on China because, as has been said, China
has become Brazil's main economic partner in terms of trade,
investment, and finance \1\ and it is curious to me that it is
still the only country in Latin America \2\ that has not joined
China's Belt and Road Initiative, which says to me that there
is still lots of opportunity for the United States to step up
in ways that we have not so far in terms of investment.
---------------------------------------------------------------------------
\1\ Although China was Brazil's largest trading partner as of
December 2022, the United States was Brazil's largest source of foreign
direct investment stocks by final beneficiary in 2021, almost four
times the amount of the next largest country source of investments,
according to data from the Central Bank of Brazil.
\2\ As of December 2022, Brazil was not among the 21 countries in
Latin America and the Caribbean participating in China's Belt and Road
Initiative (BRI).
---------------------------------------------------------------------------
Secretary Nichols, do you think that is an accurate
assessment, that there is more opportunity, and what can we do
to encourage U.S. investment?
You mentioned a number of the public entities that can
provide resources, but are there ways that we could also
encourage the private sector to do more to invest in Brazil?
Mr. Nichols. Thank you, Senator.
I absolutely agree. I think that the--one, the United
States is the largest source of foreign direct investment in
Brazil, but we need to redouble those efforts. I think U.S.
Trade Representative Ambassador Tai's recent visit and the
rejuvenation, the reinvigoration, of our agreement on trade and
economic cooperation is an important step to doing that.
Under Secretary for Economic Business and Environment
Affairs Jose Fernandez will be traveling later in the month to
Brazil to continue those conversations. Ambassador Bagley, in
country, is very much focused on strengthening our economic
relations with Brazil.
It is a large, vibrant market. There are huge opportunities
for American companies. One of the ways that those
opportunities can be strengthened is regulatory harmonization
and that will be among the things that we talk about with
Brazil.
Senator Shaheen. Thank you. I would also point out that
there is legislation, Greater Exports to Africa Act, that I am
co-sponsoring along with other members of this committee that
would require a strategy to increase trade to Africa, Latin
America, and the Caribbean by at least 200 percent over the
next 10 years.
I hope we will also think about a more directed strategy to
do this.
Mr. Duke, following Special Envoy Kerry's trip to Brazil
last month, can you talk about what was identified either there
or as we are thinking about the best opportunities to partner
with Brazil to address climate change and the destruction of
the Amazon?
Mr. Duke. Thank you, Senator Shaheen, for the question.
When we look at the global climate challenge very high on
the list is stopping deforestation in the Amazon region and in
other tropical forest regions including in the DRC and in
Indonesia.
In the case of Brazil, we are eager to partner with the
Lula administration to build on their track record of prior
success in reducing deforestation, over 80 percent in their
prior administration over a decade ago, and we see that the
deforestation rates over the last 4 years in Brazil really
skyrocketed and there is an opportunity now in partnership with
President Lula and his impressive team to reverse that and to
decisively slow and end deforestation together.
There is a range of cooperation that we have initiated
through our Climate Change Working Group now that President
Lula and President Biden urged us to propel this year and that
we have now put on a fast track with our visit just a few weeks
ago under Special Presidential Envoy for Climate Kerry's
leadership.
That includes working on the bioeconomy. It includes
working on productive and low-carbon agriculture. It includes
directly tackling deforestation through measures around
enforcing against illegal activities like illegal mining in the
Amazon region and it includes mobilizing support from a range
of other governments, from the private sector, and from also
philanthropy to make sure that the Lula team has the
opportunity to create different pathways for the people that
live in the Amazon region instead of illegal activities. We are
optimistic about the overall approach.
Senator Shaheen. When we talk about those alternatives to
illegal activities, are we talking about trying to help them
identify resources that will allow them to provide support for
people who are faced with that choice?
Mr. Duke. Thank you, Senator.
Yes, when it--it is the case, of course, that Brazil is an
upper middle income country, according to the World Bank,
overall.
When you look at the people that live in the Amazon region,
it is often very marginal economic activity that we are talking
about there and people that are really struggling just to get
by and so they turn to illegal activities like mining or like
marginal agriculture on deforested or degraded lands.
What we seek to do and seek to engage with Congress
regarding is to mobilize support to allow for Brazil to enforce
its own laws and to provide economic opportunity for the people
living in the Amazon region and manage the Amazon region in a
more effective manner.
Senator Shaheen. Is there a price tag on what you are
looking at?
Mr. Duke. Senator, thank you for the question.
I think it is fair to say that it is a major climate
imperative to address deforestation in the Amazon. It is a
major biodiversity imperative. It has ramifications. It is a--
--
Senator Shaheen. Right. I agree with that. Cost? Do you
have a cost?
Mr. Duke. It is a--let us just say that the kinds of
proposals that have been advanced recently we think are
commensurate with the scale of the opportunity and the
challenge in the Brazilian Amazon.
Senator Shaheen. Okay. I assume there is a cost, but we do
not know what it is yet?
Mr. Duke. Senator, if I could indicate, it is certainly
going to be something that needs to be in the seven-figure
range over time and where we will be needing to mobilize across
resources that we hope to work with Congress to secure, but
also from these other sources--other governments and the
private sector, philanthropy, and other stakeholders that can
contribute.
Senator Shaheen. Thank you.
Senator Young.
Senator Young. Thank you, Chairman.
Secretary Nichols, I appreciate you being here today to
discuss a number of issues surrounding our bilateral
relationship with Brazil.
Farmers and manufacturers in my home state of Indiana
depend quite a bit on market access to ensure they can continue
to grow and stay relevant in this globalized world in which we
live.
Brazil is our 14th largest trading partner and, therefore,
presents a real opportunity to forge new trading relationships,
but also to address issues like Brazil's history of tariff
barriers on things like ethanol and a wide range of commodities
like corn and soybeans.
Over the past few months, the Administration has announced
a number of efforts to support trade, but unfortunately the
common theme is that market access is off the table.
Ambassador Tai has launched the America's Partnership for
Economic Prosperity to increase cooperation on trade in the
Western Hemisphere, but it excluded Brazil.
The Administration has also announced an effort to
strengthen trade ties through the U.S.-Brazil Agreement on
Trade and Economic Cooperation, but details have not been
transparent.
Secretary Nichols, I realize we do not have a
representative of USTR here. That is a problem with the
Administration's doing. These are public hearings. I certainly
will presume that they could contact the committee if they had
an interest in having their voice heard on this important
issue.
I will ask you how would American farmers and businesses
benefit from increased trade with Brazil under the U.S.-Brazil
Agreement on Trade and Economic Cooperation?
Mr. Nichols. Thank you, Senator Young.
The opportunities to strengthen our trade with Brazil are
wide and varied. I note that Ambassador Tai's visit was one of
the--came early in the Lula administration and reflects our
desire to have a strong trade relationship and open up markets
and opportunities for American farmers and businesses.
As I noted, Under Secretary Jose Fernandez will soon follow
that. Under Secretary Fernandez is the State Department's lead
on America's Partnership for Economic Prosperity.
When the initial 11 countries were discussing APEP, we were
in the midst of Brazil's election. This is an opportunity to
engage with them now that they have a new government.
I believe that as we look at opportunities across different
sectors, American private sector agriculture will see benefits
in different commodity exchanges, farm equipment where we
continue to have a robust presence, manufacturing, services,
and technology.
Senator Young. Yes, you have listed a lot of things. You
have alluded to market opportunities that exist there and I
just really question whether we are going to have much success
gaining substantial market share anywhere without offering
reciprocal access to other countries. It just sort of stands to
reason.
I wish the Administration continued success there while
offering a lot of encouragement to rethink that anti-trade
position.
Secretary Nichols, ag production has experienced a lot of
growth in Brazil, leading the nation to become a top exporter
of commodities. This is partly--I think there are some lessons
to be learned from Brazil because of their favorable regulatory
system for biotech approvals. In fact, Brazil is the second
largest producer of biotech crops in the world, right behind
the United States.
As you may know, 90 percent of corn in the U.S. is
considered genetically modified and this has proved challenging
with our close neighbor in the region: Mexico.
Mexico's decrees to phase out and to ultimately ban
genetically-modified corn is going to have rippling
implications throughout their own market, but also throughout
our global supply chains and export markets, hurting American
and Brazilian farmers alike.
The U.S., I think you would agree, must pursue science-
based approaches with our trading partners. Otherwise, we risk
losing market access and market share that cannot be easily
replicated.
I am going to ask you what I hope will be a yes or no
response. Do you think that science should play a key role in
establishing trade policies with our partners? Yes or no.
Mr. Nichols. Yes.
Senator Young. Thank you. What are the implications to
global commodity markets should Mexico's decree to ban GMO corn
be implemented?
Mr. Nichols. I know that it would have a significant
negative effect on food security in Mexico and it is vital for
our partners around the world, particularly in a time of
climate change, to use the seed types that are resilient to
climate shocks, are proven safe by thousands of studies, and
provide opportunity for farmers in our country and around the
world to produce even under more challenging conditions,
whether it is greater floods or greater droughts.
Senator Young. I completely agree, which is why we need to
do whatever we can working with our counterparties in other
countries to ensure that they break down barriers to GMO
products, that we can produce more, innovate more, and
ultimately feed the world. This is how we are going to do it.
Thank you, Chairman.
The Chairman [presiding]. Senator Hagerty.
Senator Hagerty. Thank you, Mr. Chairman.
Assistant Secretary Nichols, welcome. It is good to see you
again today.
While the subject of the hearing today is Brazil, I would
like to take my time today to ask you some questions about
another country of your responsibility and that is Mexico. I
think you and I are going to be on the same page today, but I
just want to make sure with a few questions.
Last Thursday, Mexican President Andres Manuel Lopez
Obrador threatened to directly interfere in future U.S.
elections. AMLO said this--I am going to quote--``If they do
not change their attitude and think that they are going to use
Mexico for their propaganda, electoral, and political purposes,
we are going to call for them,'' --meaning Mexicans and other
Hispanics--``we are going to call for them not to vote for that
party.''
Assistant Secretary Nichols, does the State Department
oppose foreign interference in U.S. elections? Just a yes or no
answer would be fine.
Mr. Nichols. Yes, Senator.
Senator Hagerty. I appreciate that.
Does the State Department condemn AMLO's threat to
interfere in future U.S. elections?
Mr. Nichols. Just as we respect Mexico's sovereignty, we
ask that President Lopez Obrador respect U.S. sovereignty.
Senator Hagerty. I certainly agree with that.
Earlier this month Mexican drug cartels kidnapped four
American citizens and murdered two of them.
Assistant Secretary Nichols, does the State Department
condemn the murder of Americans by drug cartels?
Mr. Nichols. Absolutely, Senator, and the protection of
American citizens around the world is our highest priority.
Senator Hagerty. I appreciate that.
After these tragic murders of American citizens, the
Mexican President publicly claimed, ``Mexico is safer than the
United States. There is no issue with traveling safely through
Mexico.''
Yet, last month the State Department issued a level four
``Do Not Travel'' warning for many parts of Mexico. Assistant
Secretary Nichols, does the State Department agree with AMLO's
claim here that Mexico is safer than the United States?
Mr. Nichols. I do not want to get into direct comparisons
with the United States, but I will note that it is vital that
we work together with the Mexican Government to improve
security for the benefit of Mexicans and the benefit of
Americans who wish to visit Mexico.
Obviously, those who suffer the most from the cartel
violence in Mexico are its own citizens and we are committed--
--
Senator Hagerty. I understand. My primary right now is to--
--
Mr. Nichols. --to cooperating with them to attack those
cartels.
Senator Hagerty. The U.S. intelligence community has
reportedly estimated that Mexican drug cartels control more
than 20 percent of Mexican territory. The cartels also control
large swaths of terrain across our southern border. These
cartels are responsible for facilitating the passage of a
record number of illegal migrants into the U.S. and almost all
of the illicit drugs that come across that border.
My next question for you is is it the State Department's
position that the government of President Lopez Obrador should
do more to counter drug cartels operating in Mexico?
Mr. Nichols. It is vital that we redouble our efforts under
the Bicentennial Framework to cooperate to attack the cartels,
to take down the networks that traffic in drugs, people,
illicit precursors----
Senator Hagerty. My question, Assistant Secretary, is
should President Lopez Obrador be doing more to counter the
drug cartels in Mexico.
Mr. Nichols. We should all be doing more.
Senator Hagerty. I agree with that, too.
President Lopez Obrador said that Mexico does not produce
fentanyl. In particular, AMLO said, ``Here, we do not produce
fentanyl.'' That is a direct quote from him.
Assistant Secretary Nichols, is fentanyl produced in
Mexico?
Mr. Nichols. Fentanyl is produced in Mexico.
Senator Hagerty. Absolutely. AMLO--are AMLO's comments
accurate or are they inaccurate?
Mr. Nichols. Mexico receives chemical precursors from
around the world. Those precursors are used to produce
fentanyl----
Senator Hagerty. In Mexico.
Mr. Nichols. --in Mexico.
Senator Hagerty. I think it is quite clear that these
cartels have flourished because the Lopez Obrador government
has made a deliberate choice not to take them on.
President Lopez Obrador also continues to take arbitrary
and punitive actions against U.S. businesses in Mexico,
including threats of expropriation. You and I have talked about
this before.
I should add that we are seeing a similar disturbing
dynamic against U.S. businesses in other Western Hemisphere
countries including Honduras, which, as of last night, I
understand, is pivoting away from Taiwan, apparently preparing
to recognize Communist China.
Do you agree, Assistant Secretary, that these threats
against American businesses are unacceptable?
Mr. Nichols. The promotion and defense of free markets,
access for American business, is a priority for this
Administration and we believe that American jobs and American
investment and trade are beneficial for countries around the
hemisphere, not just the United States.
Senator Hagerty. I look forward to working with you. This
committee, I am certain, looks forward to working with the
State Department to lock arms to right the ship with respect to
election security here in America, with respect to the safety
of Americans traveling in Mexico, with respect to cartels that
are committing human and drug trafficking that are impacting
our country, and certainly dealing with these expropriation
threats coming from Mexico.
Thank you. I look forward to working with you, Assistant
Secretary Nichols.
Mr. Nichols. Likewise. Thank you, Senator.
Senator Hagerty. Thank you, Mr. Chairman.
The Chairman. Thank you.
Chairman of the Western Hemisphere Subcommittee, Senator
Kaine.
Senator Kaine. Better late than never with a lot of
hearings going on, and I know that there is a vote underway and
many of the questions that I wanted to ask--I was just
chatting--I think had been covered pretty well.
I expect to introduce a bill soon to help strengthen the
U.S.-Brazil rule of law cooperation in support of protecting
the Brazilian Amazon, which will be critical to attracting
greater and more sustainable investment in the region.
To you, Mr. Duke, if we are serious about deepening the
partnership with Brazil, environmental cooperation is a really
important way to do that. It is very good to see the
Administration plan to commit financial resources to the Amazon
Fund.
Do you believe the amount is sufficient, and what are other
steps that we can take to deepen this U.S.-Brazil partnership
on the Amazon?
Mr. Duke. Thank you, Senator Kaine, and we share your
concern with this issue.
When we look at what is required on climate change stopping
deforestation in the Amazon is very high on that list and it
also is important for agricultural systems, including
potentially our own agricultural systems due to the way that
the health of the Amazon reverberates in the whole region and
the whole hemisphere.
We want to ensure that whatever we do we support the Lula
administration in replicating and even extending its prior
success in reducing deforestation in the Amazon region since
they previously cut deforestation rates over 80 percent and
they are committed now to working quickly to end deforestation
and illegal activities in the Amazon region.
To do that, though, does require resources and it requires
substantial resources for results-based approaches like the
Amazon Fund, for broader approaches that can be involving the
private sector, and we are committed to working with partner
governments and with Congress and with the private sector in
order to get the job done.
Senator Kaine. I understand my colleagues have
significantly raised the issue of concern about Brazilian-
Iranian relations and I am appreciative that colleagues have
raised that and hopefully we will be able to do that soon in
person during a visit that many of us hope to take soon.
I also know that there have been questions asked and
discussion about the need to backstop and promote democracy in
Brazil, a populous nation, a global leader in so many ways.
They saw what so many other nations, including the United
States, have seen.
I grew up and had the opportunity to work in Honduras as a
missionary in 1980 and 1981, and it was a military
dictatorship, and I sort of grew familiar with the fact because
it caused me to rethink my own naivete--that an awful lot of
people in the world live under authoritarians. I just did not
think we would see that impulse here at home.
What we have seen in recent years was a little bit
different than the sort of dictatorship that I was familiar
with. What we have seen is this tendency of people to come into
office via democratic means, but then to try to unwind the
democratic institutions that protect democracy--rule of law, a
free press, independent judiciary--and that was, obviously, a
tremendous problem with the previous administration in Brazil.
You see it in Turkey. You see it in El Salvador. You see it
all around. You saw it on January 6 here at the Capitol,
efforts to undermine democracies by weakening the institutions
that guard them.
I do believe that Brazil and the United States can work
together. I know my colleagues have raised that as a priority
and I know each of you are committed to that.
With that, Mr. Chair, I yield back.
The Chairman. Thank you, Senator Kaine.
Some final questions. I understand President Bolsonaro
gutted Brazil's environment and indigenous ministries and
replaced important officials with military personnel with no
conservation experience.
Are we doing anything to support President Lula's efforts
to adequately staff the ministries tasked with combating
deforestation?
Either one of you who has an answer.
Mr. Nichols. Brazil has a wealth of expertise in these
areas and President Lula has traveled here to meet with the
President with his minister of environment, Marina Silva.
Special Envoy Kerry met with her during his trip to the region.
We believe that they bring a very strong, strong team to
the table to address these issues and we stand ready to work
with them and support them in their effort.
The Chairman. Okay. Are we committed to engaging
subnational actors who are working to preserve Brazil's vitally
important forest resources?
Mr. Duke.
Mr. Duke. Thank you, Mr. Chairman.
Yes, and I will add in regards to your last question around
indigenous communities in Brazil that when Special Presidential
Envoy for Climate Kerry was in Brasilia, he did meet also with
Minister Guajajara, who is the new minister for indigenous
communities in Brazil, and we have over the last 2 years in our
office met multiple times with stakeholders focused on human
rights and economic welfare of the indigenous communities in
Brazil. We will continue to engage on that.
In regards to staffing, we recognize that Brazil has the
capacity that Assistant Secretary Nichols just referred to and
we are seeking through this partnership with other governments,
philanthropy, the private sector, to help Brazil with
resourcing its overall efforts to end deforestation and illegal
activities in the Amazon, including through the Amazon Fund and
other results-based approaches and that should help with
staffing as well.
The Chairman. I take from your answer that we are
prioritizing the inclusion of indigenous communities to ensure
their voices are also front and center in our Amazon
deforestation prevention efforts?
Mr. Duke. Thank you, Mr. Chairman.
Absolutely, and we see in the Amazon Fund itself structured
engagement of indigenous communities as part of how that
mechanism works and we expect that any work we do in
partnership with Brazil and supportive of Brazil's objectives
to end deforestation and illegal activities in the Amazon
region will centrally involve indigenous communities.
The Chairman. In addition to having vast rainforest and
terrestrial biodiversity, Brazil has a sprawling coastline
almost twice the length of the United States.
As a champion of Save Our Seas 2.0 Act and a follow-on that
we are in the midst of working, we cannot forget about our
oceans.
How are we engaged with Brazil on efforts, for example, to
combat plastic pollution and also is Brazil concerned about
China's overfishing in their territorial waters?
Mr. Nichols. We have a robust dialogue with Brazil on
maritime and ocean issues, particularly our cooperation in the
South Atlantic. Illegal, unregulated, unlicensed fishing is a
threat to all of the countries with oceans in our hemisphere
and obviously the presence of large Chinese commercial fishing
fleets just off the territorial waters of the countries in
South America is a major problem when they turn off their
transponders and then who knows where they go.
The Chairman. Do the Brazilians, though, see that as a
problem?
Mr. Nichols. I do not know what Brazil's specific position
is on that topic, but I can look into that and get back to you.
The Chairman. I would appreciate that because I know that
they are dealing with China economically, but here they are--
China is overfishing these territorial waters in a way that is
tremendous consequence economically, tremendous consequence in
terms of biodiversity in the region.
[Editor's note.--The requested information referred to above
follows:]
Brazil does not currently focus on illegal, unreported, and
unregulated (IUU) fishing, but with our encouragement and engagement,
departments within the Brazilian Government are starting to make
initial strides to address the problem. This year, under the new Lula
administration, the Brazilian Ministry of Environment and Climate
Change told the Department of State that Brazil would put greater
emphasis on combating IUU fishing. The president of the Brazilian
Institute of the Environment and Renewable Natural Resources, the
institution responsible for enforcing environmental regulations,
reiterated to us his intention to address this problem, as well.
The U.S. Embassy in Brasilia recently helped organize an IUU
monitoring conference with Brazil's Management and Operational Center
of the Amazonian Protection System focused on both the Amazon Forest
and the ``Blue Amazon.'' The Department also continues to advocate that
the Government of Brazil ratify the Port States Measures Agreement and
join the newly established IUU Fishing Action Alliance. The Ministry of
Defense refers to Brazil's territorial waters and exclusive economic
zone as the ``Blue Amazon'' to raise attention to the need for greater
maritime domain awareness. In February, the United States co-hosted
with Brazil's Defense Ministry a conference on maritime remote sensing,
the first bilateral event on IUU fishing involving military and
civilian agencies.
The Department of State leads the U.S. Government's efforts to
eliminate the harmful effects that IUU fishing has on the ocean,
vulnerable communities, and the rule of law around the world.
Countering IUU fishing covers an expansive area of work with emerging
connections to transnational organized crime, human trafficking and
labor abuses, market and trade distortions, and data management. Only a
concerted and collective global action can solve this growing problem.
Through these essential initiatives, we aim to strengthen overall
ocean governance, increase information sharing, apply innovative
technologies to identify IUU fishing and hold bad actors accountable,
grow the ranks of partners around the world, and raise our collective
ambition to counter IUU fishing.
Lastly--and then I will turn to Senator Van Hollen--Brazil
is the second Latin American country to be designated as a
major non-NATO ally and since 2018 the United States has
committed to nearly $6 million to help reinforce security,
defense cooperation, and the rule of law.
In particular, we have invested in efforts to bolster law
enforcement cooperation and strengthen information sharing,
counterterrorism, cyber crime, financial crimes, trafficking of
narcotics and weapons.
Going back to the ranking member's questions on the docking
of Iranian ships, what can we do to enhance security
cooperation between Brazil and the United States under
President Lula?
Mr. Nichols. We look forward to the U.S.-Brazil Defense
Dialogue later this year as an opportunity to discuss our
defense cooperation and defense relations with Brazil.
Brazil is a global leader in peacekeeping, historically,
and that role is important and one that we support. The
opportunities for commercial sales of U.S. weapon systems to
Brazil is something that I think we should explore more deeply
and to continue exchanges between our law enforcement and our
militaries.
The Chairman. More likely or less likely to have Brazil's
help in countering China's authoritarianism and its aim in the
Western Hemisphere?
Mr. Nichols. I think that we need to have a dialogue based
on values with Brazil and talk about what are the values that
we would like to see in our hemisphere, and I know that
President Lula strongly supports democracy and human rights,
and we hope that we can work to promote those values throughout
our region.
The Chairman. Okay. Does not answer my question.
More likely or less likely to stand up to dictators and
autocrats in the Western Hemisphere?
Mr. Nichols. Brazil has condemned the actions of Nicaragua,
for example, and the stripping of the citizenship of those who
oppose the brutal Ortega-Murillo regime, and I hope that Brazil
will continue to speak out against human rights abuses in our
region.
The Chairman. Senator Van Hollen.
Senator Van Hollen. Thank you, Mr. Chairman. Thank both of
you for your testimony and for your service.
Ambassador Nichols, I know we have covered a lot of
territory at this hearing. I want to underscore some of the
issues that had been raised by my colleagues and then I have a
few questions.
One, we were, of course, all alarmed by the images of the
attacks on democracy in Brazil following Bolsonaro's exit. I
understand that you have not commented on the question of
whether or not the current government has asked for an
extradition of Bolsonaro. I think we would probably want to
follow up on that question.
Deforestation--I know when President Lula came in, he
pledged that he was going to reverse the previous
administration's policy, which led to just clear cutting and
destruction of huge swaths of rainforest, but so far the
numbers do not indicate that they have turned the corner in any
way and so I hope, more than expressing concern, we work with
the Brazilians on a strategy, going forward. It seems we need a
plan and I look forward to following up with you and your
colleagues on the plan.
My questions are these. Number one, you have referenced a
couple times the role Brazil can play in critical minerals and,
as you know, we are working to try to develop a partnership
among like-minded countries, nonauthoritarian countries, to
secure a good supply of critical minerals, not just for
ourselves, but for all the countries as part of the
partnership. What specific role would Brazil play in that
effort?
Second, and this is a little bit of a follow-on to the
chairman's question, Brazil is, of course, the ``B'' in the
BRICS, along with Russia, India, China, and South Africa. There
is going to be a summit in South Africa, I think, in August.
Could you just talk a little bit about Brazil's role within
BRICS and whether they provided a balance to the authoritarian
members of BRICS, namely, China and Russia?
How do you see them balancing those roles? Critical
minerals, role in BRICS.
Mr. Nichols. Brazil is a country with important critical
mineral resources and United States, through the Development
Finance Corporation, has promoted U.S. investment in mining in
that sector.
Brazil is an important producer of automobiles and other
technologies that benefit from critical minerals. The supply
chain opportunities for both of our countries are enormous.
I think that we will see even greater U.S. investment in
the sector, going forward. I noted earlier that Under Secretary
Jose Fernandez will be traveling to Brazil in a couple of weeks
and this will certainly be a topic as he also leads the State
Department's efforts in the critical minerals initiative and
this I consider a win-win for both countries.
With regard to BRICS, President Lula was one of the
founders of BRICS and a real power when it started under his
first term in office.
He has a unique opportunity to talk about the values of
democracy and engagement with the other members of BRICS. He
has an opportunity to talk about what kind of a world we want
to see in the future--is it acceptable that one country should
invade its neighbor just because it is bigger--and I look
forward to his engaging on those issues. I know that he will
play an important role in the global stage and this is a time
where values matter.
Senator Van Hollen. I certainly hope he will do that in
partnership with his allies, the United States and others.
Obviously, we are not part of BRICS, but I hope he will be that
voice at the table, given the other countries who are part of
that.
Do I understand you to say the DFC has put down an
investment with respect to critical minerals in Brazil?
Mr. Nichols. Yes, Senator Van Hollen, twice. Initial
investment and then they increased the investment and now
actually mining operations have begun and they are producing.
Senator Van Hollen. Appreciate it. Thank you.
The Chairman. Thank you. With our thanks to both of you for
your testimony, the record for this hearing will remain open
until the close of business on Thursday, March 16, 2023.
Please ensure that questions for the record are submitted
no later than Thursday.
This hearing is adjourned.
[Whereupon, at 11:58 a.m., the hearing was adjourned.]
----------
Additional Material Submitted for the Record
Responses of Mr. Brian Nichols to Questions
Submitted by Senator Robert Menendez
Question. Two years ago, a violent mob--incited by dangerous
disinformation and fueled by a former president--stormed the U.S.
Capitol seeking to undermine American democracy. Two months ago, the
world watched Latin America's largest democracy come under assault in
hauntingly similar ways. These attacks failed because of the resilience
of the Brazilian and American people, and the strength of our
democratic institutions. But the assault on Brazil's institutions
reminds us of the constant work needed to safeguard democracy around
the world. That is why I introduced a resolution earlier this year
condemning the insurrection, expressing our solidary with the Brazilian
people, and reaffirming U.S. support for Brazil's democratic
institutions. Has the United States received any requests for
assistance in response to the insurrection in Brazil? Given these
events, how can we strengthen support for Brazilian democracy moving
forward?
Answer. The U.S. Government remains ready to assist the Government
of Brazil to protect its democratic institutions and investigate those
who perpetrated and planned the violent attacks in Brasilia, on January
8. All Government of Brazil requests for assistance to protect its
democratic institutions and conduct associated investigations would be
reviewed expeditiously and supported, if deemed legally appropriate.
At their February 10 White House meeting, President Biden and
President Lula emphasized that strengthening democracy remains a
fundamental pillar of the bilateral relationship. The two presidents
reaffirmed their intention to work together on ways to protect our
societies from disinformation campaigns, as well as condemn other
corrosive dynamics that threaten democracy such as hate speech,
political extremism and political violence.
Question. During President Lula's recent visit to the United
States, President Biden expressed a desire to strengthen our economic
partnership with Brazil. Brazil is the world's eighth largest economy,
and the United States is Brazil's second largest trade partner. Our
countries share significant opportunities to advance economic
prosperity and sustainable and inclusive development, including by
continuing to publicly support Brazil's efforts to pursue accession to
the Organization for Economic Co-operation and Development. It is
imperative that we continue making the case that the United States, not
China, should be Brazil's preferred trading partner. What challenges
and opportunities does the U.S. face in strengthening economic
cooperation with Brazil? What impact, if any, would Brazil's proposed
Mercosur trade deal with China have on U.S.-Brazil economic relations?
Answer. The February 10 meeting between Presidents Biden and Lula
reinforced the shared focus on further deepening our bilateral economic
relationship. The leaders committed to fostering trade and removing
barriers as well as promoting economic cooperation, including
cooperation on supply chain resilience.
According to the United States Census bureau, bilateral trade in
goods between the United States and Brazil surpassed $92.6 billion.
This marks a significant increase from the $78.2 billion in trade in
goods from 2021, and is the highest total on record between our two
countries.
To consolidate and deepen these trade gains, the United States and
Brazil conduct regular government-to-government exchanges, through the
2011 Agreement on Trade and Economic Cooperation as well as the ongoing
U.S.-Brazil Energy Forum, Critical Minerals Working Group, Commercial
Dialogue, and CEO Forum. Last year, U.S. Customs and Border Protection
launched a full Global Entry arrangement and a Customs Mutual
Recognition Agreement with Brazil, to facilitate travel and trade.
While Brazil and its Mercosur partners have signed and may continue
to pursue trade agreements with other countries, we are focused on ways
to continue to develop our strong and dynamic bilateral trade
relationship.
Question. Brazil and the United States have recently made
significant inroads in strengthening space cooperation. Brazil was the
first Latin American country to sign the NASA Artemis Accords
establishing a common vision for space governance. It was the first
nation to hold high-level space engagement talks with the U.S. Space
Force. And our two countries signed a Technology Safeguards Agreement
in 2019 to bolster Brazil's ability to engage in commercial space
launch activities using U.S.-licensed technology from its Alcantara
launch center. Deepening such space collaboration has significant
benefits for U.S. companies, for the safe and peaceful exploration of
outer space, and for strengthening Brazil's ability to respond to
environmental challenges, including deforestation. What concrete steps
is the Biden administration planning to take to expand space
cooperation with Brazil?
Answer. Civil space cooperation between the United States and
Brazil is principally governed by a framework agreement signed in 2011
and ratified by Brazil in 2018. Several ongoing projects operate under
this framework, including most prominently the Scintillation Prediction
Observations Research Task (SPORT), a heliophysics CubeSat
collaboration between NASA and three Brazilian agencies, Brazil Space
Agency (AEB), National Institute for Space Research, and the Instituto
Tecnologico da Aeronautica. The small satellite launched in November
2022, and deployed from the International Space Station in December
2022.
Brazil signed the Artemis Accords in June 2021. Then-AEB President
Carlos Augusto Teixeira de Moura visited Marshall Space Flight Center,
in August 2022, for discussions on a potential NASA-AEB collaborative
lunar science CubeSat mission in support of the Artemis program. In
2023, representatives from AEB have taken an active role in co-chairing
an Artemis Accords working group tasked with exploring how nations with
emerging space capabilities can participate in future deep space
exploration.
Brazil remains an active participant in several earth observation
initiatives, including SERVIR, a joint NASA and USAID program that
partners with geospatial organizations on a regional basis to address
critical challenges in climate change, food and water security,
disaster management, land use, and air quality. In January 2021, NASA
renewed its MOU with the city of Rio de Janeiro to support city
disaster management and response using NASA earth observation tools.
On commercial space matters, the Foreign Commercial Service
recently supported efforts to help bring U.S. launch companies such as
Virgin Orbit to the Alcantara Space Center. The Federal Aviation
Administration opened discussions to assist the Brazilian Government on
issues of airspace regulation and safe commercial space operations.
______
Responses of Mr. Brian Nichols to Questions
Submitted by Senator Marco Rubio
Question. President Lula da Silva won the 2022 October presidential
election by a very small margin. Many Brazilians still assert that Lula
was not legitimately elected. Today, his presidency faces daunting
challenges, including slow economic growth, widespread deforestation in
the Brazilian Amazon, and deep fissures in Brazilian society. The
economy's dependence on Chinese imports of Brazilian beef and soybeans,
the illegal mining of gold and land grabbing in the Amazon are also
contributing to pressures that Brazil must face.
Considering the existing challenges, how do you characterize our
current bilateral relationship with Brazil?
Answer. The long-term, strategic U.S.-Brazil relationship has never
been more important to both countries. This year, the United States and
Brazil celebrate 200 years of diplomatic relations. As the two most
populous democracies in the Western Hemisphere, our commitment to
democratic principles forms the basis of our many shared values.
President Biden and President Lula reaffirmed our vital and enduring
partnership during their February 10 meeting at the White House. Nine
cabinet officials joined the presidents, reflecting the breadth and
depth of our bilateral relations. Strengthening democracy, protecting
human rights, and addressing the climate crisis anchor our shared
agenda. As President Biden has said, ``There are no limits to what our
nations can achieve by working together.''
Question. Do you agree that Brazil is a major partner of the United
States, not just in Latin America, but the world?
Answer. We agree that Brazil is a major partner on both a regional
and global level. In the region, Brazil is a leader on trade,
migration, human rights, and democracy. Safeguarding democracy in the
region remains the foundation of our strategic partnership with Brazil.
In our engagement with President Lula's administration, we look to
Brazil as a key voice in supporting the need to maintain and reinforce
democratic governance in Latin America.
We also recognize Brazil's longstanding global role. We work
closely with Brazil in multilateral fora, including in the UN Security
Council, where Brazil holds a seat through the end of 2023. We expect
Brazil will remain a committed leader in the UN on humanitarian issues,
peacekeeping operations, and international peace and security.
President Lula seeks to position Brazil as a leading voice for peace.
We look forward to working with Brazil on global issues when it serves
as G20 president in 2024.
Question. Why did Biden choose not to engage with Brazil during the
administration of Jair Bolsonaro?
Answer. Under the Biden-Harris administration, the United States
engaged with the Bolsonaro administration bilaterally and
multilaterally on issues of mutual interest, ranging from trade to
regional governance. The two presidents met on June 9, 2022, when they
pledged to continue their ongoing collaboration on trade and commercial
matters, including through U.S. support for Brazil's candidacy for
accession to the Organization for Economic Cooperation and Development.
During the two presidents' overlaying administrations, Brazil signed
the Artemis Accords, became a member in the U.S. Global Entry program,
and entered into the bilateral Customs Mutual Recognition Agreement
with the United States. These are just a few examples of U.S.-Brazil
cooperation and engagement during the Biden-Harris and Bolsonaro
administrations.
Question. Is the political polarization in the country affecting
our bilateral relationship?
Answer. The United States and Brazil have enjoyed nearly 200 years
of bilateral relations and our ties have remained strong across
different administrations in both countries. President Biden and
President Lula acknowledged the increased political polarization in
their countries during their February 10 meeting at the White House.
They also affirmed their continuing commitment to reject extremism and
violence in politics and their intentions to make their societies more
resistant to disinformation, which frequently encourages political
polarization, and agreed to work together to address these concerns. We
are confident that Brazilian institutions are fully capable of
addressing challenges arising from political differences within the
country.
Question. Specifically, our defense, security cooperation and
counter narcotics policy?
Answer. Political polarization within Brazil does not impact our
bilateral relations vis-a-vis security cooperation, including defense
cooperation and counternarcotics policy. In fact, the transition
between administrations with regard to these critical security areas
has been seamless. We both place a priority on maintaining our military
interoperability and security cooperation relationship, to combat
threats such as narcotics trafficking.
Question. Just last month, President Biden met with President Lula
at the White House, where both issued a joint statement that identified
``strengthening democracy, promoting respect for human rights, and
addressing the climate crisis'' as the center of their common agenda.
They also pledged to build on long-standing areas of cooperation, such
as trade and investment, energy, health, science, technology and
innovation, defense, education and culture, and consular affairs. Only
days after that visit, Brazil allowed two Iranian warships to dock in
Rio de Janeiro, despite withholding these permission for several weeks
while the Brazilians were planning Lula's visit to the United States.
Was the topic of the Iranian warships brought up during the
Presidents' meeting?
Answer. We made clear to countries in the region that these two
Iranian vessels have no business making port calls anywhere in the
Americas. Brazil is a sovereign country that can make its own decision
about how to engage with Iran. Hosting naval vessels belonging to a
regime that is brutally suppressing its own people at home, providing
weapons to Russia for use in its war of aggression against Ukraine, and
engaging in terrorism and destabilizing activities around the world
sends the wrong message and is the wrong decision in our view.
Question. Does the Administration intend to take punitive steps
against those entities in Brazil that provided material support to the
warships, which as I understand are under U.S. Treasury Iran-related
sanctions as of February 3, 2023, per Executive Order 13599?
Answer. As noted, we designated both the Dena and the Makran as
property of the Iranian Government on February 3, pursuant to E.O.
13599. We cannot preview potential future sanctions actions. If
sanctions actions are warranted, we will work with the Department of
the Treasury to take appropriate steps.
Question. Why did the Brazilian Government ignore the public
request made by U.S. Ambassador to Brazil Elizabeth Bagley to not allow
the ships in?
Answer. Brazil is a sovereign country that determines the nature of
its relationship with Iran. We made clear to relevant countries that
Iranian ships have no business docking in the Americas.
Question. How long did the ships stay in Rio?
Answer. On February 26, one Iranian naval vessel, the Dena, entered
the port of Rio de Janeiro, while another vessel, the Makran, anchored
offshore. The Dena left port on March 4, and both ships departed
Brazilian waters a few days later.
Question. What services were provided to the ships during their
stay?
Answer. We understand that the Dena, the vessel that docked,
received services from commercial providers. If sanctions actions are
warranted, we will work with the Department of the Treasury to take
appropriate steps.
Question. In your view, what are the positive and negative aspects
of our current relation with Brazil?
Answer. The positive aspects of our relationship with Brazil
include our shared commitment to cooperate on many global issues
including combating climate change, promoting the respect for human
rights, strengthening democracy, reducing poverty, and increasing food
security. As with any country, we do not always agree with the
decisions Brazil makes, such as its recent decision to allow Iranian
Naval vessels make a port call in Rio de Janeiro.
Question. Yesterday, I re-introduced legislation with Senator
Menendez to target the actors that support the illicit production and
trafficking of gold--a major challenge to the region's security and
stability. Many of these illicit actors use the proceeds from this
activity to support a range of criminal entities that threaten both
ours and Brazil's national security, including the Maduro regime in
Venezuela. These illicit groups are causing human rights abuses and
destroying the vulnerable ecosystems of the Amazon basin, which is a
critical source of livelihoods to many in the region. Is the State
Department supportive of this legislative effort?
Answer. The Department strongly supports efforts to detect, deter,
and dismantle the actors and facilitation networks that enable criminal
activities, including the illicit production and trafficking of gold.
The Department looks forward to reviewing the re-introduced legislation
when available. As you rightly noted, criminals use the proceeds of
their illicit activities to further their nefarious activities,
expanding into new areas, corrupting actors, and depriving citizens of
stable governance and human rights. The Bureau of International
Narcotics and Law Enforcement (INL) supports multi-country initiatives
that strengthen national capacities to address financial flows related
to illicit gold mining and regional cooperation to counter criminal
activity emanating from Venezuela.
Question. What initiatives is the State Department carrying out to
counter illicit activities in the Amazon and areas predominantly used
by these groups?
Answer. The Bureau of International Narcotics and Law Enforcement
(INL) recently launched $5 million in new projects that provide
training and equipment to strengthen bilateral and cross-border
cooperation to counter deforestation and trafficking of illicit timber,
gold, wildlife, and drugs across the Amazon basin. INL funds assistance
led by the United Nations Office on Drugs and Crime, the Drug
Enforcement Administration, and the Department of the Interior's U.S.
Fish and Wildlife Service (FWS), among other partners. INL support
includes training and equipment to the Brazilian Institute of the
Environment and Renewable Natural Resources (IBAMA) and supports FWS
joint investigations with the Brazilian Institute of Environment and
Renewable Natural Resources.
Question. In 2019, during the previous Administration, Brazil was
designated a major non-NATO ally. This designation allows Brazil to
benefit from enhanced cooperation with the U.S. defense industry,
including joint military exchanges, exercises, and training. A 2020
Research, Development, Test, and Evaluation Agreement enables bilateral
collaboration on basic, exploratory, and advanced technologies at a
``level enjoyed only by NATO allies and the closest strategic security
partners of the United States.''
What is your assessment of Brazil's performance as a non-NATO ally
thus far?
Answer. Brazil has been a major non-NATO ally since 2019, and our
defense relationship is stronger for it. The May 2022 Research,
Development, Test and Evaluation Agreement permitting joint development
of defense technology is the only such agreement we currently have in
South America. Joint training, exercises, and exchanges reached new
heights in recent years, reinforcing interoperability and operational
readiness. Brazil is the largest nationally funded Foreign Military
Sales portfolio in SOUTHCOM's area of responsibility. Brazil also
contributes to global peace and security as a member of the UN Security
Council and a major contributor to UN peacekeeping operations.
Question. Is President Lula honoring the commitments under this
designation?
Answer. Our defense relationship is based on shared values and
history. We anticipate that our cooperation will continue under the
current Administration and that there will be additional opportunities
to strengthen cooperation based on our shared priorities and interests.
Question. When Lula was last President of Brazil, and during the
term of his successor, Dilma Rousseff, Brazil's mais medicos program
brought thousands of Cuban doctors and medical personnel to Brazil. The
State Department has repeatedly called out Cuba's medical missions as
an example of human trafficking and forced labor. The administration of
former President Bolsonaro ended this practice and has joined U.S.
efforts to hold Cuba accountable for this despicable crime against the
Cuban people.
Has the Biden administration communicated to President Lula about
the concerns with the forced labor of Cuban doctors and medical
professionals?
Answer. U.S. embassy officials met with relevant Brazilian
ministries involved in the Lula administration's new medical access
program, Mais Medicos para o Brasil. Embassy officials communicated
that we welcome Brazil's decision not to contract with the Cuban
Government for this program. They also reminded their Brazilian
interlocutors of the Cuban Government's regular use of forced labor in
its labor export programs, including the medical missions. Mais Medicos
para o Brasil prioritizes the hiring of Brazilian medical professionals
with Brazilian degrees, followed by Brazilian medical professionals
with foreign credentials, and then individual foreign medical
professionals. We will monitor this new program to verify that forced
labor does not become part of the program.
Question. Should President Lula reinstate the mais medicos program,
how will our Embassy and consulates in Brazil be prepared to assist
victims of Cuban forced labor schemes?
Answer. On March 20, the Lula administration officially launched
its new medical access program, Mais Medicos para o Brasil, which aims
to hire 15,000 new medical professionals and place approximately 28,000
medical professionals around Brazil, primarily in poorer regions, by
the end of 2023. For this program, Brazil elected to prioritize the
hiring of Brazilian medical professionals and to contract with
individual medical professionals. We do not anticipate that the Lula
administration will contract with the Government of Cuba for medical
professionals for this program. Our embassy and consulates in Brazil
will continue to monitor the program, as they have done even before its
official launch, to verify that the program does not employ government-
affiliated Cuban workers who are vulnerable to forced labor.
Question. Cuba's medical missions provide a critical source of
funding for Cuban efforts to harbor American fugitives and provide safe
haven for terrorist groups in Latin America. How will the Department
counter Cuba's efforts to promote terrorism in the Western Hemisphere?
Answer. The Administration seeks every opportunity to bring abuses
in Cuba's labor export program to light, raising our concerns regarding
forced labor in Cuba's labor export program with senior officials
around the region. Every year since 2010, the Department has documented
indicators of forced labor in Cuba's overseas missions in the annual
Trafficking in Persons report.
During the January 18-19, 2023 U.S.-Cuba Law Enforcement Dialogue,
we strongly conveyed our concerns to Government of Cuba officials about
several U.S. fugitives who reside in Cuba. We reiterated our request
that Cuba return these individuals to the United States, noting that
individuals who committed crimes should face justice in the United
States, even many years later.
Question. Do you believe that Cuba's designation as an SST is a
beneficial tool in countering Cuban-sponsored terrorism?
Answer. The SST designation subjects Cuba to a number of sanctions,
including restrictions on U.S. foreign assistance, bans on defense
exports and sales, certain controls on exports of dual use items, and
miscellaneous financial and other restrictions. These consequences have
had minimal direct impact on Cuba as the country is already subject to
numerous sanctions.
Additionally, some companies and financial institutions refuse to
do business with countries designated as state sponsors of terrorism,
even when the transactions are not legally prohibited.
Question. Is the Administration considering rescinding Cuba's state
sponsor of terrorism designation?
Answer. The Department of State designated Cuba as a state sponsor
of terror (SST) for repeatedly providing support for acts of
international terrorism in granting safe harbor to terrorists. The
Department carefully reviews available information, from many sources,
to determine if a country meets the statutory criteria for designation
or rescission. There is an extremely high bar to rescinding the
designation. In accordance with U.S. law, prior to the rescission of
any SST determination, the President would submit a report to Congress
certifying that specific statutory criteria had been met. President
Biden remains committed to policies that advance the democratic
aspirations of the Cuban people and improve human rights.
Question. Soon after assuming office, President Lula expressed his
interest in negotiating a free trade agreement with the People's
Republic of China. The PRC is already the top destination of Brazil's
exports, comprising about 26.8 percent of the total. America,
meanwhile, only comprises 11.2 percent of Brazil's exports. It is no
wonder that the Brazilian Government is increasingly more willing to
work with the Chinese Communist Party over us. As the world's eighth
largest economy, it is critical that we not lose Brazil to the CCP.
What is the status of trade talks with Brazil agreed to by the 2020
Agreement on Trade and Economic Cooperation?
Answer. The United States and Brazil signed the U.S.-Brazil
Protocol Relating to Trade Rules and Transparency under the 2011
Agreement on Trade and Economic Cooperation (ATEC) in October 2020, and
it entered into force in February 2022. The Protocol modernizes ATEC by
adding new commitments on Trade Facilitation, Good Regulatory
Practices, and Anti-Corruption. The Protocol helps simplify customs
procedures, provides traders more opportunity to participate in
development of regulations, and builds more confidence in the rules of
the marketplace.
United States Trade Representative Katherine Tai visited Brazil
earlier this month to strengthen and deepen the bilateral trade and
economic partnership, through the ATEC. She expressed our interest in
convening an ATEC meeting before the end of the year, and our technical
teams will develop a work program in the months ahead.
Question. What is your assessment of efforts to prevent Brazil from
awarding control of its 5G network to Huawei and other Chinese firms?
Answer. We actively engage governments and network operators,
including in Brazil, to support informed decision-making when deploying
5G networks. We raise awareness about the true costs and implications
of using untrusted suppliers, which include widespread security risks
and interoperability issues. The industry-led global movement towards
open, interoperable approaches, such as Open Radio Access Networks, or
Open RAN, has the potential to increase market competition, lower
costs, and improve security. Providers and operators in Brazil are
testing Open RAN architecture solutions, such as telehealth in remote
areas of the Amazon.
Brazil's November 2021 5G auction sold spectrum to
telecommunications providers, which have the discretion to contract
suppliers to build out their networks. Brazil also began creating a
private government 5G network, awarding the initial design phase via a
public, transparent tender to a U.S. company. We will continue our
engagement to encourage the use of trusted suppliers for subsequent
phases.
Question. The Administration's plan for enhancing economic ties
with Latin America is the Americas Partnership for Economic Prosperity
(APEP). At the first round of talks this past January, Brazil was
absent.
What are the implications for APEP's success if the largest economy
in South America is not participating?
Answer. The Americas Partnership for Economic Prosperity, a
regional initiative outlined at the Summit of the Americas in Los
Angeles, in June 2022, launched in January, and it will soon begin its
implementation phase. The Partnership will keep an open architecture
and develop clear criteria for those countries that wish to join beyond
the initial phase. We look forward to the possibility of future
collaboration with Brazil in this effort.
Question. What do you think are the reasons for Brazil's absence
from the talks?
Answer. At the time we were coordinating with the initial group of
countries about the Partnership, Brazil was in the middle of its
presidential election. Now that the election has taken place, we will
engage with the Government of Brazil about this initiative. We hope to
move as quickly as possible toward an open architecture that Brazil and
other regional governments can join.
Bilateral economic cooperation with Brazil is a top priority, as
President Biden and President Lula reaffirmed in their February 10
White House meeting.
Question. Could the reason be that the United States is not
prepared to discuss with other countries the prospect of increasing
market access?
Answer. The United States continually looks for ways to strengthen
its economic relationships through a variety of means and dialogues.
The United States Trade Representative (USTR) is responsible for our
engagements with other governments about market access, and we defer to
its expertise about the timing of such discussions. USTR Ambassador
Katherine Tai had a productive visit to Brazil earlier this month to
continue discussions with Brazil about cooperation under our Agreement
on Trade and Economic Cooperation (ATEC) and proposed an ATEC meeting
later this year.
______
Responses of Mr. Brian Nichols and Mr. Richard Duke to Questions
Submitted by Senator John Barrasso
Question. Wyoming is seeing an astronomical increase in the amount
of deaths related to fentanyl. At the same time, the amount of fentanyl
in Wyoming is at an all-time high. The Wyoming Division of Criminal
Investigation seized about 1,600 ``dosage units'' of fentanyl in 2020.
In comparison, there was nearly 13,500 units seized in just the first
three quarters of 2022.
What is the Department of State doing to work with the Government
of Mexico to stop the importation of fentanyl precursors from China?
Answer. The U.S.-Mexico Bicentennial Framework for Security, Public
Health, and Safe Communities guides our bilateral security cooperation
to combat synthetic drugs like fentanyl and the diversion of precursor
chemicals. At the October 2022 U.S.-Mexico High-Level Security
Dialogue, the United States and Mexico committed to implement a joint
synthetic drug action plan to complement ongoing cooperation between
our respective law enforcement agencies. The action plan brings in
additional entities not traditionally involved in counternarcotics
efforts--regulatory agencies, the health- and trade-focused agencies,
and the private sector--so we can build the capacity needed to disrupt
the broader synthetic drug supply chain. Specifically, the Department
supports Mexico's efforts to counter drug production and trafficking
through technical expertise, training, and equipment donations. We
support Mexico's efforts to seize and investigate clandestine drug
labs, regulate and prevent the diversion of precursor chemicals, and
interdict illicit drugs and precursor chemicals, including
strengthening Mexico's ability to secure ports of entry and mail
facilities.
With regard to the People's Republic of China (PRC), we have seen
successful cooperation on counternarcotics in the past. Following a
2019 agreement, the PRC no longer serves as a meaningful source of
finished fentanyl flowing to the United States. However, the PRC
remains a major source of precursor chemicals which are shipped to
transnational criminal organizations to produce illicit fentanyl. While
engagement with the PRC on counternarcotics remains limited in recent
months, the growth in synthetic drug production is a global problem,
and we actively seek to re-engage the PRC.
The PRC can and needs to do more as a global partner to disrupt
synthetic drug supply chains by implementing know your customer
regulations, expanding information sharing, and strengthening
enforcement of customs labeling agreements.
Question. Where is the biggest security gap in the importation of
fentanyl chemicals into Mexico?
Answer. Transnational criminal organizations take advantage of
limited inspection and under-resourced agencies to divert chemicals to
produce synthetic drugs, including fentanyl. Increasing targeted
inspections in all modes of transportation via air, cargo, land ports
of entry, seaports, and international mail would enhance Mexico's
capacity to prevent the use of precursor chemicals in illicit drug
production. Our enduring security cooperation with Mexico is critical
to our efforts to address fentanyl trafficking, reverse our overdose
crisis, and prepare to confront emerging synthetic drug threats in the
future.
Question. On February 22, 2023, there was a confirmed case of
atypical bovine spongiform encephalopathy (BSE) in the northern state
of Para. The test samples were submitted to the World Organization for
Animal Health (WOAH), but the WOAH report indicates that the event
started on January 18, 2023. That is a difference of 35 days where BSE
was not confirmed in Brazil.
Why did it take Brazil 35 days to confirm a case of atypical BSE?
Answer. The World Organization for Animal Health (WOAH) requires
member countries to report listed diseases within 24 hours of
detection, per its notification requirements. Each country determines
how it will comply with these requirements, and many send samples to
foreign laboratories for confirmatory testing, which comprises the
official detection. Because these countries consider the official
detection to be the confirmatory testing in the foreign laboratory,
that notification can take longer than countries with in-country
laboratory detection while still falling within the WOAH guidelines. By
this measure, Brazil consistently reports BSE confirmatory tests or
detections within the allotted timeframes set by WOAH. Brazil follows
processes like other countries that do not have an in-country
diagnostic lab. In the most recent case, Brazil sent the sample to the
National Centre for Animal Diseases/Canadian Food Inspection Agency in
Lethbridge, Canada.
Brazil is currently designated negligible risk by the World
Organization for Animal Health and has never reported a classic case of
BSE. Since 2010, Brazil has reported six atypical BSE cases. Per WOAH
guidelines, these atypical BSE detections do not affect a country's BSE
status.
Question. Brazil has a history of delayed reporting of atypical BSE
cases. There were two atypical BSE cases, one in Minas Gerais, on June
11, 2021, and another in Mato Grosso, on June 25, 2021. Again, WOAH was
not notified of Brazil's two BSE cases until September 3, 2021. This
delay in reporting of BSE cases raises serious concerns over the
credibility of Brazil's food safety and animal health systems. The
impacts these concerns can have on the U.S. cattle herds and public
health are severe.
Given Brazil's track record of failing to report animal diseases in
compliance with WOAH standards, what steps is the Administration taking
to ensure Brazil is held accountable for food safety standards?
Answer. While the timeframe between Brazil's sample collection and
confirmation testing is likely due to the additional time needed to
complete testing at a foreign laboratory, the Chief Veterinary Officer
of the United States did discuss these concerns with her Brazilian
counterpart in March 2022. Since that conversation, Brazil has worked
to decrease the time between sample collection and confirmatory
reporting.
Question. How is Brazil's central competent authority the Ministry
of Agriculture, Livestock, and Food Supply (MAPA), working with the
U.S. Department of Agriculture Food Safety and Inspection Services
(FSIS) on beef products imported into the United States since their
case of atypical BSE on February 22, 2023?
Answer. Through the Foreign Agricultural Service at our embassy and
consulates in Brazil, USDA continues to work with Brazil's Ministry of
Agriculture, Livestock, and Food Supply (MAPA) to ensure its
agricultural exports comply with international guidelines and U.S.
requirements. Since the detection of the BSE case in February, MAPA has
held dialogues with the main importers of Brazilian beef, describing
information about the case and MAPA's actions to comply with
international guidelines.
______
Responses of Mr. Richard Duke to Questions
Submitted by Senator Brian Schatz
Question. Trade Measures in Reducing Deforestation: Cattle ranching
is the biggest driver of deforestation in Brazil. Much of this is
occurring in violation of existing Brazilian laws. U.S. imports of beef
products from Brazil have rapidly increased in recent years, topping $1
billion last year. The U.S. is the largest importer of processed beef
and the second largest importer (behind China) of fresh beef and some
of this product is known to originate from slaughterhouses connected to
deforestation and illegal ranching in the Amazon. Leather emanating
from Brazil and found in supply chains of U.S. car seats has also been
linked to cattle ranching that is driving deforestation. The European
Union is expected to soon approve a new law designed to keep products
driving deforestation out of its markets--and I am preparing the
reintroduce legislation (the FOREST Act)--to remove illegal
deforestation from the products we use and consume every day.
What role do you think such trade measures should play, as a
complement to financial and technical assistance the U.S. can provide,
to help Brazil reduce deforestation, to promote traceable and
transparent commodity supply chains, and to ensure our own markets are
reinforcing and not undermining these efforts?
Answer. The drivers of deforestation are complex and varied, as are
the tools needed to combat deforestation. While trade measures are a
possible tool, a combination of financial assistance, technical
support, and capacity building will likely have the greatest effect on
addressing international deforestation associated with the production
of agricultural commodities. As mandated in Executive Order 14072, the
Secretary of State will submit a report to the President by April 22,
2023, on options for a whole-of-government approach to combating
international deforestation.
Question. U.S. Assistance to Companies: In addition to the Amazon
rainforest, the Cerrado savannah and Pantanal wetlands are under
threat, particularly from the production of agricultural commodities
such as beef and soy, which is leading to the rapid conversion and loss
of these irreplaceable ecosystems and their biodiversity. Addressing
this problem will require greater accountability and transparency from
the companies involved, as well as incentives and financing for
producers and a pathway to transition so that companies can meet their
voluntary commitments and comply with emerging requirements in the
European Union and elsewhere.
How will the U.S. assist companies in doubling down on commitments
to achieve zero deforestation and conversion in their supply chains,
particularly for soy and cattle?
Answer. The United States has been working to assist U.S. companies
in meeting their zero deforestation and conversion commitments, and
this includes 14 of the largest traders of agricultural commodities,
like U.S. companies ADM, Bunge, and Cargill. The U.S. Agency for
International Development and State-supported Forest Data Partnership
helps generate data needed to decouple agriculture production from
deforestation. Other programs, like USAID's Amazonia Connect and
Business Case for Collective Landscape Action, support reductions in
commodity-driven deforestation.
______
Responses of Mr. Brian Nichols to Questions
Submitted by Senator Bill Hagerty
Question. China has gained significant influence in several
strategic Western Hemisphere countries, including Brazil, the largest
economy in South America. Brazilian President Lula da Silva moved to
significantly strengthen China-Brazil ties during his first stint as
president nearly 20 years ago, and Chinese trade with Brazil is now
double that of the United States. CCP-aligned companies have made large
infrastructure investments in Brazil, including in some of the
country's largest deep-water ports and telecommunications sector.
Are you concerned that the President Lula will work to further
deepen ties with China?
Answer. Brazil and the United States have a strong relationship
that has grown more dynamic in recent years. Brazil also has a
longstanding and extensive economic relationship with the People's
Republic of China (PRC), its largest trading partner. We recognize
Brazil's global role and expect the Lula administration will pursue
Brazil's national interests as he and his team view necessary. We
recognize that the United States must maintain vigilance and
consistently emphasize why we should remain the preferred partner to
Brazil. We will continue to convey our concerns about the PRC's
troubling trade, environmental, human rights, and other practices, with
Brazil and other governments in the region.
Question. How does China's increasing economic and trade ties with
Brazil pose a threat to U.S. economic interests and influence in the
region?
Answer. Brazil and the United States have a strong and growing
trade and investment relationship. U.S. companies are the largest
investors in Brazil with about $190 billion in investment stock as of
2021, far more than PRC companies. U.S. firms contribute value-added
industries in manufacturing, agriculture, steel production, energy,
communications, and technology. U.S. investments support hundreds of
thousands of jobs in Brazil, an enormous positive influence in our
relationship.
Brazil also has an important economic relationship with the PRC,
its largest trading partner. We work with partners, including Brazil,
to press for the PRC's economic engagement in the region to meet
international standards of transparency, adherence to the rule of law
and anti-corruption practices, debt sustainability, labor rights,
environmental best practices, and the needs and concerns of local
communities.
Question. How might China's ability to use Brazil as a platform to
project its influence and strategic interests in Latin America pose a
broader threat to U.S. regional security interests?
Answer. We echo the longstanding calls from Latin American capitals
that the PRC's engagement and investment respect local laws and
interests, particularly regarding the human rights of all, including
workers, and protections for the environment. We encourage countries to
monitor national security and data privacy threats that come with
untrusted vendor investment in critical infrastructure and sensitive
sectors. We work with our partners around the region to encourage
transparency in investments, respect for individual rights and
freedoms, and support for democratic values.
Question. Specifically, what is the Biden administration's strategy
to prevent China from acquiring deep water ports that could be for
``dual-use'' purposes by the PLA Navy?
Answer. The Department has encouraged partners to strengthen their
national security tools, including investment screening and other
authorities, to ensure port infrastructure investment does not raise
national security risks. We also provide technical assistance to
improve our partners' capacity to evaluate bids for critical
infrastructure projects. The Strategic Ports Initiative aims to protect
critical ports abroad from problematic actors, and we continue to work
with government development agencies to provide access to financing for
strategic infrastructure projects.
Question. How has China's expanding military cooperation with
Brazil, including joint military exercises and arms deals, impacted
U.S. strategic interests in the region? What is the Biden
administration doing to discourage deeper China-Brazil security ties?
Answer. The PRC's expansionist designs on our hemisphere are a
strategic concern--for us, and for our neighbors. While Brazil's
interests, trade ties and economic situation necessitate pragmatism,
Brazil continues to make it clear that we share values and desires to
maintain interoperability. We include Brazil in strategic initiatives,
negotiate agreements to facilitate military procurement and exchanges,
and work with Brazilian counterparts to ensure positive outcomes for
both of us through our many regular dialogues including Political-
Military Dialogue.
Question. In what ways does China's growing presence in Brazil's
technology sector and infrastructure projects raise concerns about
potential espionage and cybersecurity risks for the U.S.? What is the
Biden administration's strategy to mitigate these risks?
Answer. We regularly convey to our partners in the region,
including Brazil, our concerns about the risks of PRC investment in
critical infrastructure like energy and technology. We also share with
our partners the value of investment screening mechanisms to protect
national interests, particularly in key industries such as civil
nuclear power and telecommunications.
In telecommunications, for example, we actively engage governments
and network operators, including in Brazil, to support informed
decision-making when deploying 5G networks. We have engaged with the
Government of Brazil and with telecommunications companies in Brazil to
raise awareness about the true costs and implications of using
untrusted suppliers, which include widespread security risks and
interoperability issues. The industry-led global movement towards open,
interoperable approaches, such as Open Radio Access Networks, or Open
RAN, has the potential to increase market competition, lower costs, and
improve security. Brazil also committed to creating a private
government network with enhanced security measures, and we will
continue our engagement to ensure that commitment is carried out.
Question. What role does China's influence in Brazilian politics
and media play in shaping public opinion and potentially undermining
U.S. efforts to promote our interests in the region?
Answer. Brazilian media outlets are strong, professional,
independent, and resistant to outside influence. With few exceptions,
PRC-originated content does not appear in mainstream media. Brazil has
a sophisticated, independent media environment which actively promotes
journalistic freedoms, including through campaigns aimed at identifying
disinformation.
Question. Given China's use of economic leverage and predatory debt
diplomacy to gain strategic footholds in resource rich areas, how is
the Administration working to ensure that Chinese investments are non-
exploitive and fair?
Answer. We continue to ensure that partners in the region,
including Brazil, recognize the serious risks involved in the PRC's
lending practices. In addition, we collaborate with the Development
Finance Corporation (DFC), U.S. Trade and Development Agency (USTDA),
Ex-Im Bank, and other U.S. agencies to provide alternatives to PRC
financing. As one example, in 2020, DFC invested $25 million in a
nickel-cobalt project in northeastern Brazil operated by TechMet, and
in September 2022, the DFC board approved an additional $30 million
equity investment in the same project. The mine achieved commercial
nickel production in July 2022. We need nickel and cobalt to power
electric vehicles and other clean energy technologies, and the TechMet
investment will generate large net exports for Brazil, incorporate
sustainable practices in mining activities, and provide hundreds of new
jobs in one of Brazil's poorest states.
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