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UNCLAS SECTION 01 OF 04 BRASILIA 001366 
 
SENSITIVE 
SIPDIS 
 
DOE FOR GARY WARD CAROLYN GAY RHIA DAVIS AMY CHIANG 
 
E.O. 12958: N/A 
TAGS: ECON ENRG EAGR BR
SUBJECT:  BRAZIL: THIRD MEETING OF USG GOB BIOFUELS STEERING 
COMMITTEE, OCTOBER 3, 2008 
 
SENSITIVE BUT UNCLASSIFIED 
 
¶1.  (SBU) SUMMARY. Under Secretary for Economic, Energy and 
Agricultural Affairs Reuben Jeffery III, Special Advisor Greg Manuel 
and PDAS Craig Kelly participated in the third USG-GOB Biofuels 
Steering Committee meeting on October 3. The  Ministry of External 
Relations' (MRE) new Under Secretary for Energy and Science and 
Technology, Ambassador Andre Amado, and MRE's Director of the Energy 
Department, Andre do Lago, led the Brazilian delegation (full del 
list para 13).  In a productive session noteworthy for the new 
Brazilian Under Secretary's energetic and enthusiastic engagement, 
the two sides preliminarily agreed on a second tranche of five 
countries for U.S.-Brazil biofuels cooperation: Guatemala, 
Guinea-Bissau, Senegal, Honduras and Jamaica.  Joint biofuels 
research efforts are entering a new phase with the signing of a 
Memorandum of Understanding (MOU) between the Energy Department's 
National Renewable Energy Laboratory (NREL) and the Brazilian 
energy-company Petrobras' research center (CENPES) for work on the 
next generation of biofuels.  Both these initiatives will be 
announced publicly for the first time at Brazil's November 17-21 
Biofuels Conference in Sao Paulo.  The Steering Group highlighted 
the positive significant progress being made in developing 
international standards for biofuels, and both sides agreed to try 
to persuade India, China and South Africa to engage more 
significantly.  The two sides also noted progress in developing 
science-based sustainability criteria.  END SUMMARY. 
 
¶2.  (SBU) MRE U/S Amado set the tone for a productive 
forward-looking discussion at the third meeting of the Biofuels 
Steering Group on October 3.  Amado opened by declaring, "We can go 
at a bureaucratic pace, or we can be daring.  Let's be daring."  U/S 
Jeffery agreed. 
 
THIRD COUNTRIES 
 
¶3.  (SBU) Do Lago reported that GOB is arranging a business group 
visit to the four first-tranche countries.  Manuel noted cooperation 
under the March 2007 Biofuels MOU included 11 projects already 
disbursing funds and 10 others with funds obligated.  IDB is now 
willing to commit USD 10 million in biofuels investment in these 
countries.  Do Lago confirmed that Brazil supports a second tranche 
of countries consisting of Guatemala, Guinea-Bissau, Senegal, 
Honduras and Jamaica.  The two sides agreed that the rollout would 
be similar to the first tranche, with a briefing on the same day in 
both Washington and Brasilia with the two Ambassadors and the 
ambassadors of the five countries.  Both sides agreed that this 
announcement could be an important part of the November biofuels 
conference, inviting the new countries as well as representatives 
from the first tranche. 
 
JOINT BIOFUELS RESEARCH 
 
¶4.  (SBU) Amado enthusiastically pushed for more joint action, 
saying the two countries either could simply claim credit for 
progress made by scientists or could help the scientists to bring 
deals forward.  Adriano Duarte from the Ministry of Science and 
Technology (MCT) reported that there were already two concrete 
projects coming out of the exchange of visits by biofuels scientists 
and he expected more.  Manuel noted that there was now a report on 
areas of shared interest.  Manuel highlighted the Memorandum of 
Understanding between the U.S. Energy Department's National 
Renewable Energy Laboratory (NREL) and the Brazilian energy-company 
Petrobras' research center (CENPES) for work on next generation of 
biofuels.  Both sides agreed that the MOU should be announced at the 
upcoming biofuels conference in November to help call attention to 
these joint efforts. 
 
¶5.  (SBU) Amado suggested including biofuels research in the October 
30-31 joint science and technology technical meeting.  The 
Ambassador noted the proposal at the last meeting of the Biofuels 
Steering Group on August 20 to create a database of universities 
interested in biofuels. FAS rep reported USDA would be sending a 
group of leaders from the sugar ethanol industry on a policy trip to 
the United States in November in order to help build industry 
linkages. 
 
INTERNATIONAL COOPERATION 
 
 
BRASILIA 00001366  002 OF 004 
 
 
¶6.  (SBU) Do Lago admitted having been surprised by the level of 
attacks by other countries, including possible expansion partners, 
against biofuels.  At the recent International Biofuel Forum (IBF) 
and Global Biofuel Energy Partnership (GBEP) conferences in Rome on 
biofuels standards, China, India and South Africa chose not to 
participate and this reluctance is affecting our work on technical 
standards, do Lago declared.  He said he hoped for improved 
participation at the IBF meeting on the margins of the November 
17-21 biofuels conference in Sao Paulo.  (NOTE:  Recently, the 
International Affairs Advisor for the Energy Ministry, Amb. Rubem 
Barbosa, told EmbOffs that the GOB was surprised by the virulence of 
the opposition to biofuels coming from its South American neighbors, 
which he attributed in significant part to anti-Americanism.  END 
NOTE.) 
 
¶7.  (SBU) Manuel replied that the situation was brighter than 
depicted by Do Lago.  He said that China, India and South Africa are 
currently marginal actors and China and India use American Society 
for Testing and Materials (ASTM) International Standards, which is 
what the USG and GOB are helping to shape now.  Manuel reported that 
soon reference materials will be distributed to over 200 
laboratories in the United States, Brazil and Europe.  This is a 
necessary precondition to making biofuels an international 
commodity.  Manuel offered to encourage India and China to adopt the 
standards we have developed. Do Lago added Brazil could try to work 
through the IBSA process (India-Brazil-South Africa) to bring them 
on board. 
 
SUSTAINABILITY 
 
¶8.  (SBU) Manuel commented that at the Rome conference in June, U.S. 
and Gob delegations successfully kept the focus on scientific 
issues, fending off efforts - especially by some Europeans - to 
inject political factors and to use sustainability as a trade 
barrier.  He expected that there would be sustainability criteria 
ready for the Spring 2009 meeting of the G-8.  Do Lago stressed that 
Brazil remains concerned about efforts to use sustainability 
criteria to erect new trade barriers but thought the USG and GOB had 
neutralized that risk for now.  Ricardo Dornelles from the Energy 
Ministry added that the Europeans were seeking to protect their 
agriculture markets; they didn't see it as an issue of energy 
security.  Manuel noted his concern that, despite the bilateral 
agreement to pursue the sustainability issue via GBEP, the Brazilian 
technical norms institute ABNT had entered into its own 
sustainability discussions with Germany.  The Brazilian side took 
note. 
 
¶9.  (SBU) Brazil's domestic sustainability efforts include the 
intention to create a zoning plan to prohibit planting of sugar cane 
in sensitive areas (e.g., the Amazon Forest and the Pantanal) and 
identify ideal cultivation zones that would be eligible for special 
financing through the national development bank (BNDES), according 
to AgMin's Alexandre Strapasson.  Rodrigo Rodrigues from the 
President's Office (Casa Civil) said GOB is also developing rules to 
address the social and labor impact of the sugar cane sector, 
including ensuring fair treatment of workers impacted by increased 
harvesting mechanization.  Casa Civil's Carlos Teixeira discussed 
possible development of a "green seal" for biofuels, which could 
assure purchasers that the biofuels were produced in a manner 
consistent with good environmental, labor and social standards. 
 
PRIVATE SECTOR 
 
¶10.  (SBU) The Ambassador stressed the importance of continuing to 
involve the private sector in biofuels efforts and particularly 
urged according business a primary role in the November conference. 
Manuel asked if Amado was prepared to move forward with the proposal 
presented by Brazil's ethanol industry association, UNICA, at the 
August meeting.  The proposal would fast track certain key 
certifications for U.S. firms seeking to bring operations to Brazil. 
 Amado responded that having just arrived on the job that week he 
required more time to study the proposal and then would respond. 
Amado also noted that, for now, he was not interested in bringing 
more academic and NGO involvement into the private sector advisory 
board.  While consulting the private sector is an obligation, Amado 
recommended outreach rather than consultation with the NGO and 
academic community to encourage a more positive view of biofuels. 
 
 
BRASILIA 00001366  003 OF 004 
 
 
INTERNATIONAL BIOFUELS CONFERENCE, NOVEMBER 17-21, SAO PAULO 
 
¶11.  (SBU) The Brazilians briefed the U.S. delegation on the 
International Biofuels Conference they will be hosting in Sao Paulo, 
November 17-21.  They proposed having another meeting of the 
Biofuels Steering Committee during that week, with top USG and GOB 
officials as observers.  Do Lago said that the GOB wanted the 
private sector, as well as the NGO and academic community, and 
legislatures from around the world present and participating through 
side events.  Do Lago noted that APEX would host a trade fair on 
biofuels during the conference.  Do Lago also indicated that 
currently 24 countries had confirmed Minister-level participation 
and GOB expected Head of State participation from at a minimum 
Philippines and Australia.  One hundred countries are expected to 
participate overall.  President Lula will speak and President Bush 
has been invited to speak. 
 
COMMENT 
 
¶12.  (SBU) The new point person for the GOB on biofuels, U/S Andre 
Amado, showed that he and his team have the political will to step 
up the pace on biofuels cooperation.  The Steering Group identified 
progress in all three pillars.  The agreement on the second tranche 
of countries for U.S.-Brazil cooperative work, the signing of the 
NREL-CENPES MOU, and the soon to be distributed reference materials 
are all concrete actions we can highlight as MOU-related 
achievements.  Amado also demonstrated his willingness to be "bold 
and daring."  After a year of resistance to the idea of reaching out 
to involve other larger countries in our efforts, Amado was quick to 
recommend that we should begin reaching out jointly to countries 
like India, South Africa, and China.  MRE sources tell us Amado is 
widely known for his vigor and exacting standards.  The November 
biofuels conference will provide additional impetus for cooperation. 
 The conference offers not only an opportunity to highlight MOU 
achievements and the bilateral relationship, but also to help chart 
the course for international development of the biofuels industry. 
END COMMENT 
 
¶13. (U) DELEGATION LISTS: 
 
Brazil 
- - - - 
Brazilian Ministry of External Relations' (MRE) Under Secretary for 
Energy and Science and Technology, Ambassador Andre Amado 
 
MRE's Director of the Energy Department, Andre do Lago 
 
Claudia Viera Santos, MRE 
 
Joao Tabajara, MRE (US Desk) 
 
Roberto Sadao Shiraishi, Ministry of Commerce 
 
Eduardo Caldas, Brazil's Trade Promotion agency, APEX 
 
Alexandre Strapasson, Ministry of Agriculture 
 
Adriano Duarte Filho, Ministry of Science and Technology 
 
Ricardo Dornelles, Ministry of Mines and Energy 
 
Carlos Teixeira, Presidential Office (Casa Civil) 
 
Rodrigo Rodriguez, Casa Civil 
 
Carlos Abreu, Deputy Chief of Mission, Brazilian Embassy in 
Washington 
 
UNITED STATES 
- - - - - - - 
Under Secretary for Economic, Energy and Agricultural Affairs Reuben 
Jeffery III 
 
WHA Principal Deputy Assistant Secretary Craig Kelly 
 
Special Advisor Greg Manuel 
 
Ambassador Clifford Sobel 
 
BRASILIA 00001366  004 OF 004 
 
 
 
Lisa Kubiske, Deputy Chief of Mission 
 
Thomas Hastings, Advisor to U/S Jeffery 
 
Morgan Perkins, Foreign Agriculture Service 
 
Rhiannon Davis, U.S. Department of Energy 
 
Richard Driscoll, Science Counselor 
 
Katherine Dueholm, Economic Deputy 
 
SOBEL