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Brazil and Europe
During the period from the 1970s to 1995, the relative importance
of the European Economic Community (EEC; now the European Union--EU)
as a trading partner with Brazil was reduced, but increased in the
mid-1990s. By 1995 German investments in Brazil were second only
to the United States, but Britain, Italy, and France also have important
investments, mostly in industrial manufacturing, heavy equipment
and automobiles, and consumer goods. In mid-1995 negotiations advanced
toward establishing a free-trade association between the EU and
Mercosul. In December 1995, the EU signed an important free-trade
protocol with Mercosul, the first ever between two regional trading
blocs. Since then Brazil has adroitly used the EU card to force
a slowdown of the United States pressure to "fast track"
the Free Trade Area of the Americas (FTAA) expansion of the North
American Free Trade Agreement (NAFTA).
Relations with the EU are economically important, but even more
so from a North-South political perspective. Brazil and its Mercosul
partners want to strengthen their trading bloc to include not only
Chile but also Bolivia, Colombia, Ecuador, Peru, and Venezuela before
2005, to be able to negotiate as a bloc with NAFTA, as opposed to
bilateral negotiations as favored by the administration of President
William Jefferson Clinton. The United States view is that 2005 is
the date for the FTAA to be "fully operational," whereas
Brazil and its Mercosul partners view the year 2005 as a "starting
point" for the FTAA process.
Data as of April 1997
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