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C O N F I D E N T I A L SECTION 01 OF 03 BRASILIA 001405 
 
SIPDIS 
 
NSC FOR FISK AND TOMASULO 
 
E.O. 12958: DECL: 10/24/2018 
TAGS: PREL ETRD ENRG BR
SUBJECT: BRAZILIANS HIGHLIGHT POSITIVE BILATERAL RELATIONS 
FOR UNDER SECRETARY BURNS 
 
REF: A. BRASILIA 1301 
     ¶B. USUN NEW YORK 0928 
 
BRASILIA 00001405  001.2 OF 003 
 
 
Classified By: Ambassador Clifford M. Sobel, Reasons 1.4 (b) and (d) 
 
¶1. (C) During his October 17 visit to Brazil, Under Secretary 
Bill Burns was told repeatedly by GOB officials and others 
that relations between the United States and Brazil are 
excellent and that they hope a new U.S. administration will 
make an early effort to build on them.  GOB officials focused 
on their efforts to manage difficult relations with their 
neighbors and to increase political and economic integration 
in the region.  In particular, they encouraged the USG to 
respond positively to the first Latin America/Caribbean 
Summit (all Western Hemisphere countries, including Cuba, 
except the United States and Canada) that Brazil will host in 
December.  Foreign Ministry officials highlighted their 
interest in cooperating on Haiti, UN Security Council reform, 
the Middle East, the financial crisis, and the Doha trade 
round.  End summary. 
 
-- Defense Minister Jobim Offers His Insights -- 
 
¶2. (C) In Brasilia, Minister of Defense Nelson Jobim provided 
U/S Burns an overview of Brazil's relations with neighboring 
countries, noting Brazil's ongoing issues with Bolivia (gas, 
and the political crisis), Ecuador (Odebrecht), Paraguay 
(Itaipu), and Argentina (gas and economic concerns).  Without 
specifying, he described many of the leftist leaders in South 
America as "primitive."  Jobim stressed that, although 
relations between the United 
States and Brazil are excellent, it would not do for our 
countries to appear too close, as it might scare Venezuelan 
President Chavez, who is already looking to use external 
threats to divert attention from his internal problems. 
Jobim suggested that the new U.S. administration should look 
at changing U.S. policy toward Cuba.  He added that there is 
no better analyst of the region than President Lula's foreign 
policy advisor, Marco Aurelio Garcia, and recommended that 
advisors to the new U.S. president meet with Garcia early on 
to get his perspective. 
 
¶3. (C) In discussing possible sale to Brazil of F-18s, Jobim 
raised Brazilian concerns with technology transfer, 
explaining that it is a critical element in Brazil's 
decision. 
 
¶4. (C) At the same meeting, Chairman of the Senate Defense 
and Foreign Affairs Committee Heraclito Fortes said relations 
between our two governments have never been better, including 
with the Brazilian congress, as a result of increased USG 
efforts.  Jobim agreed, saying that SouthCom's recent efforts 
have improved relations with the Brazilian military.  Fortes 
said the new U.S. administration needs to continue and 
enhance engagement of this nature with Brazil, citing 
peacekeeping in Haiti as a positive, concrete example of how 
our countries can work together. 
 
¶5. (C) Fortes expressed concern with growing Iranian and 
Russian influence as a result of Venezuela's ties, and 
suggested that the United States should give more support to 
Mercosul as an organization aimed at preserving democracy. 
At the same time, Fortes voiced his opinion that Ecuador's 
President Correa presents a greater long-term threat to 
stability in the region than Venezuela's Chavez because 
Correa is educated and his moves are planned.  Fortes also 
raised his continuing frustration with the absence of the 
United States at the Inter-Parliamentary Union (IPU). 
 
-- Mexican Ambassador to Brazil Offers Thoughts on CALC -- 
 
¶6. (C) Mexican Ambassador to Brazil Andres Valencia Benavides 
provided his views of the December 17-18 conference of Latin 
American and Caribbean heads of state (CALC) in Bahia (Reftel 
A).  Benavides lamented that, with the demise of negotiations 
for a Free Trade Area of the Americas, the Summit of the 
Americas process had lost the hemisphere-wide unifying theme 
that drove it.  He suggested that the new U.S. administration 
should seek to provide such a theme. 
 
-- Finance Ministry Chief of Staff Discusses Region, Energy, 
and Economy -- 
 
BRASILIA 00001405  002.2 OF 003 
 
 
 
¶7. (C) In a separate meeting, Finance Ministry Chief of Staff 
Luiz Melin said that the CALC meeting represents another way 
for Brazil to manage Chavez, and suggested that the USG 
should find ways to broaden dialogue with the region across 
sectors, including through acknowledgement of and respect for 
the role of the various regional and sub-regional mechanisms 
that have been put in place.  He emphasized that these 
mechanisms do not represent a barrier to cooperation with the 
United States.  "You need to give them legitimacy and welcome 
them," he said.  Melin sees the region as being at a tipping 
point, 
and stressed that Brazil must sell regional mechanisms as 
"fair and useful" as it works to bring countries like 
Venezuela on board with a more constructive approach.  Andean 
Development Bank (CAF) Brazil Representative Moira 
Paz-Estenssoro, a Bolivian, agreed with Melin, urging the 
U.S. "to build partnerships with respect, acknowledging good 
actions." 
 
¶8. (C) Melin also discussed Brazil's response to the global 
financial crisis.  Noting that Brazil had learned its lesson 
from its previous economic crises, the GOB slashed investment 
in an effort to control government spending, which resulted 
in Brazilian infrastructure suffering severely.  This time, 
the GOB intends to maintain its commitment to spending under 
the Program to Accelerate Growth (PAC) aimed at increasing 
investment in infrastructure, so as to lay a foundation for 
future growth as it manages the crisis.  Mines and Energy 
Ministry official Francisco Wojcicki described the Brazilian 
energy matrix, emphasizing that Brazil welcomes foreign 
investment as it develops its pre-salt reserves and expands 
and maintains its electricity infrastructure. 
 
-- Itamaraty Luncheon: Brazilian Perspective on Global and 
Regional Issues -- 
 
¶9. (C) The Brazilian Ministry of External Relations (MRE, or 
Itamaraty) hosted a two-hour working lunch that covered a 
wide range of bilateral and global topics.  U/S for Political 
Affairs Everton Vargas toasted the deepening bilateral 
relationship and said a purpose for the talks was to see 
where our convergences lie.  The bilateral relationship is 
characterized by positive dialogue and cooperation.  It is 
important to build on it.  U/S for Energy and Technology 
Andre Amado stressed the importance of continuing biofuel 
cooperation in third countries despite the orchestrated 
effort by some to &demolish8 progress. 
 
¶10. (C) In discussing the financial crisis, U/S Vargas 
suggested that, as the G-7 had been created to address the 
oil crisis in the 1970s, so the international community needs 
to consider creation of new mechanisms to address the current 
crisis.  This is why President Lula had proposed an ECOSOC 
meeting to help develop a response.  However, he added, "we 
have no illusions about a magic solution."  Vargas noted that 
the Ibero-American Summit would be held in El Salvador at the 
end of the month, saying that, although the theme is 
officially energy, former Inter-American Development Bank 
President and now Ibero-American Summit Executive Director 
Enrique Iglesias is encouraging discussion of the financial 
crisis, as both crises go hand in hand.  U/S for Economic 
Affairs Luiz Carneiro de Mendonca said that timing will be a 
key question for the future Doha trade round, affected by 
election cycles in the United States and India. 
 
¶11. (C) U/S Vargas raised reform of the UN Security Council, 
saying that the international community must keep reform at 
the center of our collective thinking (Reftel B). 
 
¶12. (C) U/S Vargas encouraged holding a donor conference on 
Haiti before the beginning of 2009.  Prior to holding it, it 
will be important to agree on the criteria for success. 
Vargas stressed the importance of linking and coordinating 
GOH priorities, and of setting a timetable for disbursements. 
 Minister Carlos Duarte, head of the International 
Organizations Department, noted that the most recent MINUSTAH 
report had benchmarks 
that would provide a useful basis for donors.  Vargas 
suggested that the USG and GOB should hold bilateral 
discussions on Haiti. 
 
 
BRASILIA 00001405  003.2 OF 003 
 
 
¶13. (C) Turning to the Middle East, Vargas said Brazil views 
USG efforts very positively.  As a participant in the 
Annapolis meeting, FM Amorim believes Brazil should help keep 
the process moving, especially as it is the key to resolving 
many other issues around the world.  Ambassador Regina 
Dunlop, representing the under secretary for Asia, Africa, 
and the Middle East, said that Brazil is particularly pleased 
that regional actors are at the center 
of efforts toward a region-wide solution.  U/S Vargas 
commented that Brazil does not want to see more states, 
including Iran, with nuclear weapons and fully supported UNSC 
sanctions. 
 
¶14. (C) Minister Joao Luiz Pereira Pinto, representing the 
under secretary for Latin America and the Caribbean, 
discussed the CALC, explaining that South American nations 
never had meetings only among themselves to discuss regional 
issues.  As UNASUL provided a forum for dialogue among South 
American governments, so CALC would provide a forum for the 
region.  The most likely focus of the summit will be the 
financial crisis, he said, although energy had been the 
original focus.  Resolving energy issues is a principal 
concern in the region, Vargas said, critical to getting South 
America on its feet.  Discussing the very different realities 
for South American countries, Vargas stressed the need for 
greater cooperation and integration on energy matter, and on 
infrastructure more broadly. 
 
¶15. (C) When asked what the new U.S. Administration should 
know about Brazil and the region, Vargas said "Bear in mind 
that people here have sensitivities".  He said that Brazil 
hopes the dialogue that has been established with the current 
administration will continue under the new one. 
 
-- Sao Paulo Meetings with Economic and Foreign Policy 
Observers -- 
 
¶16. (SBU) Chairman of the Senate Economic Affairs Committee 
Senator Aloizio Mercadante (Labor Party), former Development 
Minister Luiz Fernando Furlan, and FIESP international 
negotiations director Mario Marconini urged that the next 
administration seek pre-inaugural contacts with major 
countries in the region to send the clearest message about 
Brazil,s and Latin America,s importance to the United 
States.  Brazil,s strong economy, the country,s moderating 
effect on the region,s politics, and the prospect for 
strategic partnership in areas such as energy (especially 
biofuels) make it imperative for the new U.S. administration 
to signal its interest in bilateral cooperation.  Important 
possibilities exist for either a Republican or a Democratic 
administration, they said. 
 
¶17. (SBU) Former Foreign Minister Celso Lafer and former 
Brazilian ambassador to London and Paris Sergio Amaral argued 
that Brazil needs to show greater resolve with its 
sometimes-difficult neighbors (e.g., Bolivia and Paraguay) 
and not indulge them every time they make demands.  They also 
stressed that the region is looking to the United States for 
leadership in a time of global financial uncertainty, much as 
the United States provided in the wake of World Wars I and 
II.  Ambassador Amaral suggested that a United States that is 
"less strong8 is not all bad for bilateral relations and 
that Brazil could prove a positive partner for Washington in 
a number of areas.  Amaral offered that Cuba and ethanol 
(most notably the U.S. tariff) were areas where a strong, 
positive signal from Washington would be well-received in 
Brazil. 
 
¶18. (U) U/S Burns cleared this cable. 
SOBEL