Why has Brazil been defensive in multilateral negotiations on trade in services?, by Raphael Coutinho da Cunha

In 1986, members of the General Agreement on Tariffs and Trade (GATT) meeting in Punta del Este, Uruguay, agreed to launch a round of multilateral negotiations to further reduce barriers to international trade. For the first time in the history of the multilateral trading system, countries agreed to discuss multilateral disciplines for trade in services, an area that includes important economic sectors such as construction, engineering, banking, insurance, communication, education, and energy.

From the start, Brazil expressed strong opposition to the negotiation of multilateral disciplines for services. Though the country did not manage to stop GATT members from including the issue in the agenda of the Uruguay Round, Brazilian diplomats used all available defensive tactics to keep liberalization commitments to a minimum in the final agreement.

Why did Brazil behave so defensively? Political economists typically look at the interaction of interests, institutions, and ideas to understand foreign economic policy. This article uses an array of archival sources and interviews to reconstruct a political economic narrative about the Brazilian diplomatic behavior in the negotiations on services during the Uruguay Round. It identifies the preferences of the private sector at the time and documents the instances in which policymakers interacted with and sought to learn about Brazilian businesses’ interests. While it becomes clear that banks and construction firms, for example, had a preference for not opening the Brazilian market, the most striking aspect when it comes to private interests is how most business people had little knowledge of the negotiations and of how an eventual agreement would affect them.

Rather, most of the explanatory power for the country’s defensive stance seems to reside in the ideas and worldviews of policymakers and diplomats. As can be gathered from the archives, diplomats in charge of economic negotiations at the time largely believed in trade protectionism as one of the main tools of economic statecraft. The adoption of multilateral rules for the liberalization of trade in services was viewed as a threat to the country’s development project, especially in sectors so often targeted by government subsidies and regulations.

The article, part of the author’s master’s thesis, shows that in the end Brazil had some of the lowest levels of liberalization commitments among comparable countries, both developing and developed. The thesis extends the analysis to the Doha Round and shows that, despite important advances, a protectionist attitude towards trade in services still lingers in the country’s economic diplomacy.


Raphael Coutinho da Cunha, Departamento de Ciências Políticas, Ohio State University, Columbus, Ohio, EUA (cunha.6@osu.edu)

CUNHA, Raphael Coutinho da. Negociações comerciais em uma economia fechada: o Brasil e o comércio de serviços na Rodada Uruguai. Rev. bras. polít. int. [online]. 2015, vol.58, n.1 [cited  2015-10-02], pp. 142-163 . Available from: <http://www.scielo.br/scielo.php?script=sci_arttext&pid=S0034-73292015000100142&lng=en&nrm=iso>. ISSN 1983-3121.  http://dx.doi.org/10.1590/0034-7329201500108.

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