AS/COA: In what ways do you see current economic and political factors converging to support opportunities for U.S.-Brazilian partnerships?
Sobel: I think that the close relations between our two countries—which, politically, starts with the presidents—have allowed us, in many ways, to explore new opportunities. In March 2007, we signed our biofuels agreement, where we agreed to do three things and we’ve made a lot of progress. The first was to work together on research and technology. The focus was to have an exchange of our scientists there and Brazilian scientists in the United States. We’ve already had those visits; in fact, the U.S Deputy Secretary of Energy Jeffrey Kupfer was here last week, and we’re looking to support those joint initiatives, not only between our researchers, but also between our institutions in universities and in the different ministries. The ministry of science and technology here is playing an active role in exchanging and having our scientists work together. We are well along in that process—and this is more for second generation cellulose technology, which involves literally taking the waste of today and making it the energy of tomorrow.
The second field of endeavor involves working trilaterally with third countries. We are well along on our way on that and we identified a number of countries, primarily in Central America. We’ve already had reports on those and we hope to be discussing other countries where we can trilaterally work together.
The last measure involves the issue of harmonization of standards and codes, so that people can build equipment for this generation of biofuels, and we’ve had a number of meetings on that. Some of those standards will be actually reported out next week and we’ve made a lot of progress.
But our partnerships have gone well beyond that. Our CEO Forum, which is unique only to one other country—India—and which the White House co-chairs, is able to bring the private sector together to be able, with the support—not the leadership—of government to look at areas that we can support the private sector and economic interests in further working together to bring our two economies closer together on trade and investment. We also have a very active agenda in public-private partnerships when it comes to corporate social responsibility. Our USAID administrator Henrietta Fore was just down here in the last few weeks, looking at how American companies partner with the public sector on corporate social responsibility programs.
So we have a lot of very fertile areas where we look for partnership and for growth in our economic, investment, and cultural institutions.
AS/COA: Talking a little bit more about biofuels, the United States and Brazil are two world leaders in the production of ethanol. But. biofuels production has come under fire in recent months with critics connecting ethanol production to high food prices. In what ways can the United States and Brazil work together in the field of energy to address these concerns?
Sobel: Actually, that’s a very relevant and important question. I am not a scientist so I am not the one to get into the merits. Though, clearly, there are many factors that have affected food prices, of which biofuels may be one. But, more importantly, on our agenda is exactly the question of how we can work together on the issues of sustainability, to be able to support the biofuel initiative yet be cognizant of some of the effects that biofuels might have in the marketplace. Clearly, the issues of sustainability are important. Food prices are everybody’s concern.
But that’s why it is so important to get our researchers working closer together (and they already are) to look at enzyme technology, to look at second and now even third generation technologies that can deal with the wastes that are not being used for food in any way, and make them work as an energy resource. While there is much activity already being done in that area, we’re looking at how the two governments together can be even more supportive of such initiatives.
AS/COA: What are some of the opportunities for Brazil and the United States to cooperate in terms of the regional security initiatives?
Sobel: The recent trip of U.S. Secretary [of Homeland Security Michael] Chertoff was very interesting. We talked about a lot of areas, not only those dealing with the container security initiative in the port of Santos, but we talked about supporting Brazil’s interests in how to correctly, creatively, and—more importantly—using the newest technologies, develop the ability for international sporting events to have the newest and best technologies available. With the upcoming World Cup here, it was an area that was talked about extensively, especially during the secretary’s trip to Rio. We’ve extended an opportunity to see how the United States might be helpful.
In regards to critical infrastructure protection—something that the United States has been very involved with over the years since 9-11—we’ve also extended outreach to Brazil if they’re interested, and, in fact, we have an ongoing dialogue in that area. Cybersecurity is one that all nations are interested in, and we’ve already begun a dialogue on.
But when you talk about security in general, I think it is important to note the recent trips of the [Brazilian] Defense Minister [Nelson Jobim] to Washington a number of months ago where he talked about several issues, not the least of which was the South American Defense Council, and where he had meetings with U.S. Secretary [of Defense Robert] Gates, U.S. Secretary [of State Condoleezza] Rice, and Assistant to the President for National Security Affairs Stephen Hadley, the national security advisor to the president. Recently, we have focused on issues of technology transfer—something that Brazil is very interested in—facilitating it so that we would like to work closer with Brazil on.
The defense minister recently traveled to our SOUTHCOM offices where he got a thorough explanation of the Fourth Fleet. With our commander for SOUTHCOM, we went with an inter-agency group working with many countries, we work with Colombia, we work with Spain, and we work with the Netherlands on drug intervention in the Caribbean. The Brazilians have agreed to put a frigate into the Caribbean waters to observe (not to participate in) how we engage in counter-drug activities. We went to our special forces operations where the minister observed and we looked at areas of joint training and joint exercises.
So we are continuing to look for those areas of partnership to work closer with the Brazilian military. In fact, we are planning, for later this year, our first talks on bilateral defense cooperation, which we’ve not had in years. So we’re looking to partner and work with Brazil, both in Brazil and Haiti and elsewhere where Brazil has an active interest.
AS/COA: You already mentioned the U.S.-Brazil CEO Forum. Can you talk a little bit about the forum and some of its specific goals?
Sobel: The Forum had its first meeting about 18 months ago in Brazilia, where it was hosted by President Luiz Inácio Lula da Silva at a dinner that went well beyond three hours, and it set the foundation for an active dialogue between some of the largest Brazilian companies doing business in the United States, as well as American companies doing business in Brazil. It underscored the increasing investment and trade of Brazil to the United States and they have looked for areas that they would like governments to focus on. The facilitation of travel, visas—something we’re very much involved with and the State Department is very focused on—now involves increasing our ability to process visas more quickly. Brazil in turn, is looking to increase their visa timeframe from five to 10 years, consolidate the B1/B2 visa process and facilitate, on their side, trade and travel.
We’ve also looked at the bilateral tax treaty. Brazil is the largest economy we don’t have a tax treaty with. We’ve had numerous meetings, the last of which was only a few months ago, and we hope to have another one in Brazil in September. Quite frankly, after more than 40 years of negotiating a tax treaty, I can say we had a very fruitful dialogue and made significant progress. We’ve talked about an investment treaty, we’ve talked about how the companies can work together to facilitate job training and English studies, so the areas have been numerous.
But one of the most successful has been the CEOs wanting to increase the frequency of flights between Brazil and the United States. And after 10 years of non-productive negotiations, we have now signed an agreement with Brazil that has opened up the frequency of flights from the Unites States. Just this week, we’ve heard announcements of direct flights from the United States to cities of the northeast that have never been served on direct flights: from Miami to Recife and Salvador; Atlanta is a possible announcement which we hope to hear soon; and we hope to see Fortaleza and Belo [Horizonte]—cities in Brazil that never had direct flights—have the opportunity to visit directly our cities in the United States and have Americans visit here. So that’s a very important aspect of the CEO Forum—looking for areas where we can focus our attention to get some positive results.