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DE RUEHBR #1590/01 3471552
ZNY CCCCC ZZH
R 121552Z DEC 08
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC 3083
INFO RUEHCV/AMEMBASSY CARACAS 4305
RUEHMO/AMEMBASSY MOSCOW 0384
RUEHRI/AMCONSUL RIO DE JANEIRO 6982
RUEHSO/AMCONSUL SAO PAULO 3197
RHEHNSC/NSC WASHDC
RUEKJCS/SECDEF WASHDC
RUCNDT/USMISSION USUN NEW YORK 0285

C O N F I D E N T I A L BRASILIA 001590 
 
SIPDIS 
 
DEPARTMENT FOR WHA/BSC 
 
E.O. 12958: DECL: 12/10/2018 
TAGS: PREL MASS ETRD EAGR ENGR BR RS
SUBJECT: THE BRAZIL-RUSSIA PARTNERSHIP: COFFEE AND SYMPATHY 
 
REF: MOSCOW 3526 
 
Classified By: DCM Lisa Kubiske.  Reason 1.5(D) 
 
¶1.  (C)  SUMMARY.  The late November visit to Brazil by 
Russian President Medvedev provided an opportunity for both 
countries to express their interest in enhanced economic 
ties, science and defense cooperation, energy and development 
of the BRIC grouping as a more regular international forum. 
Brazil and Russia used Medvedev,s visit and the meeting of 
the Intergovernmental Commission on Economic Cooperation that 
preceded it as a means of evaluating their current 
relationship and exploring areas of potential for increased 
partnership.  Working with Russia, another large country with 
an expanding economy, is politically attractive to Brazil, 
which aspires to the sort of regional leadership (and 
permanent UNSC seat) that Russia has.  Russia also provides a 
growing market for Brazilian exports, including meat and 
coffee, as well as a source of technology for Brazilian 
industry.   Although Medvedev,s visit highlighted these 
areas of potential, Russian-Brazil cooperation remains more 
theoretical than actual.  Brazilians cite the difficulty of 
doing business with Russia, diverging interests in such areas 
as alternative fuels and Russia,s backing of Hugo Chavez as 
obstacles to progress.  The Medvedev visit was widely seen by 
Brazilians as successful in terms of the number of 
declarations in principle that cooperation would be pursued, 
rather than because of any concrete results.  While Brazil,s 
decision to purchase twelve Russian helicopters was heralded 
as indicative of a new strategic partnership, Brazilian 
officials have privately referred to the purchase as a 
&token.8  Although the declaration of the Presidents made 
much of areas for future collaboration, it was notably silent 
on the current financial crisis, a key omission in light of 
the importance of oil prices to Russia,s economy, the 
effects already being experienced by Brazil's export sector, 
and the role both aspire to play in resolving the crisis. 
The relationship with Russia will continue to be politically 
important to Brazil, but partnership will continue to feature 
more joint declarations than concrete projects.  END SUMMARY. 
 
¶2.  (C)  During a recent discussion at the Ministry for 
External Relations (MRE), the Director for Europe, Elizabeth 
Mazzella, described Brazilian feelings toward Russia as 
&sympathy.8  Brazilians believe that they and Russia have 
much in common.  Both are large, multi-ethnic states with 
growing economies.  In 2002, the two governments launched a 
&strategic partnership8 that was reaffirmed during 
President Medvedev,s November 2008 visit to Brazil.  While 
the visit yielded some substantive results, notably Brazil,s 
decision to purchase combat helicopters, most of what emerged 
was in the nature of resolutions to explore future 
cooperation in such diverse areas as energy, the environment, 
coffee exports and UN reform.  Much like the coffee to be 
exported, such broad declarations, though lacking substance, 
are much to the Brazilian taste and illustrate Brazil,s 
political interest in enhancing its sympathetic relationship. 
 
POTENTIAL FOR TRADE 
--------------------------------- 
¶3.  (C)  When asked about results from the Lula-Medvedev 
Summit, Brazilian officials cite commercial cooperation as of 
greatest importance, however, the actual outcomes of the 
meeting indicate that at present the potential for 
cooperation greatly exceeds the reality.  In 2007, bilateral 
trade was worth approximately $5 billion, and the Presidents 
called for its expansion and diversification.  For Brazil, 
the priority will be on exports from its agricultural sector, 
especially meat products.  Russia has restricted Brazil 
exports, particularly of pork and chicken, based on supposed 
concerns about food safety but has shown signs of relaxing 
its restrictions.  A Russian food inspection team recently 
visited Sao Paulo and Brazilian meat packagers have signed 
agreements to operate two plants in Kaliningrad.  The MRE 
also reports new agreements for the sale of Brazilian trucks 
and coffee (&In Moscow, they drink too much tea.8) to 
Russia.  The Presidents also agreed to work on an agreement 
to avoid &double taxation8 to promote business cooperation. 
 
¶4.  (SBU)  Lula and Medvedev emphasized the energy sector as 
having "significant potential for cooperation."  Gazprom and 
Lukoil have sent teams to Brazil to try to get a piece of 
Brazil,s offshore oil action by offering alleged Russian 
expertise from joint projects with the U.S. to help surmount 
technical obstacles to exploitation of Brazil,s pre-salt oil 
reserves.  Rosatom has approach the Brazilian Ministry of 
Energy about Brazil,s plan to build up to eight new nuclear 
power plants, but the MRE believes Russia to be an unlikely 
partner because of its unwillingness to transfer technology 
and its insistence on providing the fuel for Russian built 
plants.  Brazil would prefer to make use of its own uranium 
reserves and enrichment capabilities.  MRE special advisor 
Marcos Pinta Gama told poloff that Russia had offered 
assistance with Brazil,s plans to build a nuclear powered 
submarine, but Defense Minister Jobim considered France a 
better partner.  Brazil was unable to interest the Russians 
in biofuels and believes Russia,s energy sector will remain 
centered on oil. 
 
¶5.  (C)  Russia agreed in principle to assist Brazil,s 
development of its Satellite Launch Vehicle as a &partner8 
for next generation space launch development.  In return, the 
Brazilians expressed interest in partnership in Russia,s 
satellite navigations system.  MRE sources told us that the 
Intergovernmental Commission had discussed possible Russian 
use of Brazil,s future satellite launch facility, but that 
the Russian side had little understanding of the difficulties 
Brazil faced in building on the proposed site.  When told 
that the land belonged to a group of quilombos (descendents 
of escaped slaves), the Russian rep had said, &What is the 
problem?  Just pack them up and move them somewhere else.8 
 
DEFENSE COOPERATION 
----------------------------------- 
¶6.  (C)  Brazil regards Russia as an important potential 
collaborator in the areas of defense and security, but, as in 
other areas, &potential8 remains the key concept.  Brazil 
and Russia were able to sign a defense cooperation agreement 
similar to the one with the U.S. that the MRE has refused to 
clear on for almost a year.  The two governments have also 
agreed in principle on an information sharing agreement whose 
negotiation was in the words of a MRE source &surprisingly 
easy.8 
 
¶7.  (C)   In Brazilian reporting on the Summit, the headline 
result was Brazil,s agreement to purchase twelve Mi-35 
attack helicopters for &defense of the Amazon.8  While the 
efficacy of a dozen relatively short range aircraft for such 
a job is open to debate, the purchase appears to be no more 
than a political sop to the Russians.  Officially, the 
decision to buy from Russia is portrayed as bringing the 
benefit of &diversified8 sources of military equipment, but 
MRE Europe Director Mazzella referred to it as a &token.8 
Brazilian military sources have told the Defense Attache 
Office that the only reason for buying some Russian equipment 
would be to demonstrate its poor quality in order to have a 
strong case for not buying more. 
 
THE FELLOW &BRIC8 ROAD 
-------------------------------------- 
¶8.  (C)  One other major result of the Medvedev-Lula meeting 
from Brazil,s point of view was Russia,s agreement to host 
a major Summit of the BRIC (Brazil, Russia, India, China) 
countries in Yekaterinburg in May or June of next year.  At 
this time, the MRE has no specifics regarding the agenda but 
regards the meeting as an important step in the development 
of the BRIC group as a regular international grouping. 
According to Mazzella, the Russians share Brazil,s interest 
in enhancing the BRIC group and have been most active in 
promoting greater group unity.  This was reflected in the 
statement released by the BRIC Ministerial in May 2008 which 
largely reflected Russian international priorities.  Mazzella 
admitted that the statement was a Russian draft but noted 
that Brazil contributed the language calling for reform of 
the UN Security Council.  India and China, although they 
attend the meetings, have not taken as great a role and have 
shown less interest in going down the road of expanding joint 
BRIC activity. 
 
UN REFORM 
----------------- 
¶9.  (SBU)  The Brazilian press showed some disappointment 
with what was seen as a lack of agreement with Russia on the 
importance of UN reform -- a term in Brazil understood to 
mean only inclusion of Brazil as a permanent member of the 
Security Council.  The MRE takes a &glass half full8 view 
of the Summit, noting that Russia did agree that the UNSC 
should be enlarged and progress should be rapid.  This 
language is viewed by the GOB as a step forward from the 
Russians, who have been seen as among the least sympathetic 
toward Brazil,s aspirations.  As one Brazilian diplomat who 
has served in Moscow put it: &Russia has lots of land and a 
falling population.  Their Security Council seat is what 
keeps them important.8 
 
STRATEGIC PARTNERS -- OR NOT 
--------------------------------------------- -- 
¶10.  (C)  For many Brazilian leaders, a strategic partnership 
with Russia makes sense.  As are many Russians, Brazilians 
are fond of rhetoric espousing &multipolarity,8 UN primacy 
and territorial integrity.  Minister for Strategic Planning 
Roberto Mangabeira Unger has stated repeatedly that Russia is 
a natural partner and has championed enhancing defense 
cooperation as a means of lessening presumed dependence on 
the U.S.  Despite the political attraction, the strategic 
partnership has, much like initiatives to enhance trade, been 
more in terms of potential than concrete projects. 
 
¶11.  (C)  From the Brazilian point of view, there are several 
reasons for caution in the partnership with Russia.  The 
Brazilian military has told Defense Attaches that they 
believe Russian equipment to be inferior and prone to 
maintenance problems.  The Sukhoi 35 was dropped from the FX2 
fighter competition in October because Russia was unwilling 
to transfer technology.  Furthermore, Brazilian Air Force 
members who participated in discussions with Russia 
considered their counterparts to be &uninterested in 
reaching a mutually advantageous deal8 but focused on 
&winning8 the negotiations.  There is also little common 
ground with Russia on such key issues for Brazil as biofuels 
and environmental initiatives.  Also, Brazilians are wary 
about what they view as excessive Russian arms sales to 
Venezuela.  With the Chavez government known to be supplying 
weapons to the FARC, Pinta Gama expressed concern that Chavez 
is buying more rifles than there are members of the 
Venezuelan military.  Concerned about the lack of control 
over their extensive borders, many Brazilians regard 
Russia,s pretext of protecting citizens with recently issued 
passports as justification for invading Georgia as an 
unwelcome precedent. 
 
¶12.  (C)  Comment: Despite the difficulties, the 
Brazil-Russia relationship offers attractions for both sides. 
 In some ways, Russia is much of what Brazil aspires to be: a 
major power with a UNSC seat that is the heavyweight among 
its region,s economies.  In Brazil, Russia has a sympathetic 
government with strong democratic credentials in Latin 
America that tends to avoid criticism of Russia,s human 
rights record and heavy handed policies toward its neighbors. 
 The Medvedev visit afforded an opportunity to reaffirm the 
partnership and announce intentions to pursue cooperation in 
commerce, defense, energy and science.  These announcements 
serve their political purpose of signaling the importance 
each country attaches to the relationship but do not 
necessarily carry much promise of follow through.  Lost in 
the impressive rhetoric on increasing trade and scientific 
cooperation is the reality of the global financial crisis and 
its likely affects on both countries and their ability to 
undertake major new cooperative projects.  Brazil and Russia 
will continue to have sympathy for each other in areas where 
it is politically advantageous, but substantial cooperation 
will probably remain on a slower track. 
SOBEL