This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 03 BRASILIA 003252 
 
SIPDIS 
 
NSC FOR CRONIN 
USDOC FOR 4332/ITA/MAC/WH/OLAC/JANDERSEN/ADRISCOLL/MWAR D 
USDOC FOR 3134/ITA/USCS/OIO/WH/RD/DDEVITO/DANDERSON/EOL SON 
DEPT PASS USTR FOR LEZNY/SULLIVAN 
BOGOTA FOR IRS 
TREASURY FOR OASIA - PARODI 
 
E.O. 12958: N/A 
TAGS: ETRD PREL PGOV OREP KIPR BR
SUBJECT: NODEL ENGLISH BRAZIL MEETINGS 
 
¶1. (U) Summary:  A congressional delegation led by 
Congressman Phil English, coordinator of the U.S. House of 
Representatives' Brazil Caucus, met on December 1 in 
Brasilia with Chamber of Deputies President Aldo Rebelo, 
Minister of Development, Industry and Trade Furlan and 
participated in a dialogue with members of the Chamber 
Foreign Relations Committee.  Nodel participants called for 
the negotiation of a bilateral tax treaty and for continued 
progress in trade negotiations in both the WTO Doha Round as 
well as the Free Trade Area of the Americas (FTAA). 
Minister Furlan expressed pessimism on the outcome of the 
Hong Kong WTO ministerial, noting that an agreement on 
reducing agricultural subsidies must be reached before 
progress can be made on the other issues on the table.  End 
Summary. 
 
¶2. (U) Background:  A congressional delegation led by 
Congressman Phil English, sponsored by the Congressional 
Economic Leadership Institute (CELI) and the Wilson Center 
for Scholars, visited Sao Paulo, Brasilia and Rio de Janeiro 
Brazil from November 28 to December 2.   In addition to a 
substantive schedule in Sao Paulo, the group held meetings 
in Brasilia on December 1.  The delegation included the 
following members of Congress: Congressman Phil English (R- 
PA), Congressman Mike Honda (D-CA) (Sao Paulo only), 
Congressman Jim Costa (D-CA), Congressman Dennis Cardoza (D- 
CA), Congresswoman Eddie Bernice Johnson (D-TX), and 
Congressman Michael Capuano (D-MA).  The delegation's visit 
formed part of a CELI-sponsored effort to encourage dialogue 
among legislative branches of different countries. 
Delegation members also visited Sao Paulo and Rio de 
Janeiro. 
 
Sao Paulo Meetings -- IPR, Ag and Bio-fuels 
------------------------------------------- 
 
¶3. (U) In Sao Paulo, the Nodel visited the Brazilian 
Mercantile and Futures Exchange (BMF) and witnessed 
agricultural trading on the exchange floor.  During the 
lunch hosted by the BMF, former Minister of Agriculture and 
current President of the Brazilian Beef Council Vinicius 
Moraes gave a complete overview of the Brazilian 
agricultural sector and urged greater cooperation with the 
U.S., including pursuing the FTAA.  Deputy Mendes Thame 
(PSDB) discussed the virtues of bio-fuels.  Congressman 
Capuano participated in a panel on IPR at the Amcham 
"International Negotiations" Forum.  The delegation also 
visited the operations center of major U.S. information 
services company EDS in Sao Bernardo for a briefing on the 
information services market in Brazil.  They closed out 
their Sao Paulo schedule with a visit to the Embraer factory 
in Sao Jose dos Campos. 
 
Ministry of Development, Industry and Trade 
------------------------------------------- 
 
¶4. (U) The delegation's meeting with Minister of 
Development, Industry, and Trade Luiz Furlan and Mario 
Mugnaini, Head of the GOB's Foreign Trade Council, focused 
on the Hong Kong Ministerial, ethanol and IPR.  Congressman 
English, a "Cancun Veteran," commended Brazil for being a 
moderating force leading up to the Hong Kong Ministerial and 
discussed the USG's offer on agricultural subsidies. 
Minister Furlan, who was visibly exhausted, voiced pessimism 
about progress on the negotiations in the upcoming Hong Kong 
Ministerial, but said that Brazil was still going into the 
talks seeking an ambitious outcome.  He added that he 
believed that there would have to be an additional 
ministerial meeting in March.  Furlan stated that an 
agreement on agricultural subsidies must be reached prior to 
further movement on any of the other issues on the table, 
noting that a key question will be the timing for phasing 
out export subsidies.  He characterized the agricultural 
subsidies issue as a social matter. 
 
¶5. (U) Congressional representatives Costa and Cardoso 
voiced their concerns about reducing agricultural subsidies 
while Congressman Capuano, noting that his district contains 
MIT and other R&D institutions, emphasized the need for 
stronger IPR enforcement.  Furlan declared that Brazil has a 
strong regime governing IPR protection and that IPR 
enforcement is a problem worldwide, including the US.  He 
stated that Brazil's IT service market is growing and 
exports are expected to reach $2 billion in 2007, adding 
that the gray market for PCs has shrunk and that Microsoft 
has launched low-priced windows software. 
 
¶6. (U) Minister Furlan then turned to the subject of 
ethanol, noting that energy is a strategic issue in the U.S. 
Furlan noted that he had met with the U.S. Secretaries of 
Agriculture, Commerce and Energy as well as the California 
State government to discuss the GoB's offer to transfer 
ethanol production technology to the U.S. Brazil has 30 
years of experience in ethanol production and 60% of 
Brazilian new cars sales are of flex-fuel vehicles.  He said 
that Brazil has 50 new ethanol projects and that ethanol 
exports have increased by 800 million liters to three 
billion liters over the past three years. 
 
Chamber of Deputies Sessions 
---------------------------- 
 
¶7. (U) After a courtesy call on Brazilian Chamber of 
Deputies President Aldo Rebelo, Nodel English members 
participated in a session of the Chamber of Deputies' 
Foreign Relations Committee.  The dialogue centered 
primarily on a few broad themes, including bilateral 
economic relations, multilateral trade negotiations, the 
environment, migration issues, the war in Iraq and the war 
on terror.  Congressman English called for the negotiation 
of a bilateral tax treaty. 
 
¶8. (U) Multiple Members of the U.S. Congress and the 
Brazilian Chamber of Deputies called for progress in 
multilateral trade negotiations.  Congressman English 
emphasized the economic benefits of free trade, highlighting 
a World Bank study that predicted a successful Doha Round 
would lift hundreds of millions of people out of poverty. 
English called for Brazil to show leadership in the Doha 
Round negotiation process, warning that there needed to be 
progress on services in order for the U.S. to show 
flexibility on agriculture.  Other Nodel members also called 
for progress towards a FTAA that includes adequate 
protections for labor and the environment.  A majority of 
the Brazilian Deputies present emphasized the importance 
they place on a "balanced" FTAA.  One noted the Brazilian 
Congress lacks a mechanism to monitor and set limits on the 
executive branch as Trade Promotion Authority (TPA) does in 
the U.S. system. 
 
¶9. (U) Migration - Multiple Brazilian Deputies emphasized 
the importance they place on the protection of Brazilian 
immigrants in the United States.  Representative Cardoza 
acknowledged the important role immigrants play in the U.S. 
economy but highlighted the importance of reducing illegal 
immigration to preserve the rule of law and mitigate the 
stresses on government social services.  Deputy Nelson 
Marquezelli argued that the FTAA could help slow migration 
to the U.S. as it opened up more opportunities for 
Brazilians at home. 
 
¶10. (U) Environment - Deputy Andre Costa, seconded by 
Foreign Relations Committee Chairman Cedraz and other 
deputies, called for the U.S. to play a "more responsible" 
international role on global environmental issues. 
Congressmen Capuano and Jim Costa noted their belief that 
the USG needed to do more to reduce global warming but 
emphasized that there was a vigorous debate on environmental 
issues both in the Congress and among the U.S. public. 
Congressman English underlined the importance of policies 
based on "sound" science.  He further argued that the Kyoto 
Protocol was fatally flawed because major developing nations 
such as China had opted to remain outside the system. 
 
¶11. (U) War in Iraq - Brazilian deputy Socorro Gomes, of the 
Communist Party, sharply criticized the war in Iraq, 
prompting a defense of USG actions from Deputy Marquezelli 
(of the PTB party).  Congressman English argued that Islamic 
terrorism represented a threat to all of the Americas. 
 
¶12. (U) This cable was not cleared by NODEL prior to 
transmission. 
 
CHICOLA