The Brazilian government, supported by the World Trade Organization (WTO) was right to set the list of more than one hundred U.S. products subject to retaliation against the subsidy policy of the United States for the production and export of cotton. Still, it is important that we use dialogue to seek a middle ground in the next 30 days deadline to execute the measure unless there is progress. But we must, above all, that the possibility of surcharging by Brazil on one of its major trading partners broaden the debate on the need to review the policy of incentives by major industrialized nations.
In practice, the outcome in the case of cotton, which stretched from 2002, to be seen more for its political than for its economic effects, although the trading volume is among the highest in the decisions taken so far by the WTO. The point is that the consequences of retaliation may have a bigger impact for Brazil than for the United States of America. Among the items listed are from wheat to medicines, beauty products and vehicles that would run the risk of having high prices internally in case the increase in the rate being achieved. In contrast, the consequences would be for the discrete segments with items taxed in the United States, but especially for the primary sector of the U.S., whose political and economic strength is considered unbeatable.
Obviously, the least desirable at the moment, in which the major economies are still trying to recuperate from the effects of the crisis is a war between two historic allies economical. After eight years of litigation and four of non-compliance by the United States to decisions taken by the governing body of international trade regulation, however, Brazil has to leave to build on this victory. Even with the financial problems reported recently on a global scale, the most industrialized countries while following his primary sector generously subsidized. As a result, prevent any developing economy to ensure profitability for its agricultural production and thus more easily fulfill its financial commitments with internal and external, which is unacceptable.
Brazil, therefore, is correct in asserting their rights and also at the opening that lets negotiate with Washington, waiting for a possible concrete proposal for reduction of subsidies. This is an important decision that has implemented the system of international arbitration, and must be expanded in international fora to adopt fairer trade policies.
Source:www.noticiasagricolas.com.br
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