Brazil flexes its muscle to shield industry

Joe Leahy – Financial Times, 03/19/2012

Guido Mantega, Brazil’s combative finance minister, underlines his determination to protect Brazilian industry from what he sees as unfair competition.

Even regional trading partners such as Mexico will not be spared. Brazil last week forced Mexico to renegotiate a 10-year-old car trade agreement.

“Brazil wants to revise this agreement with Mexico because it has established conditions that are unfavourable to Brazil and is leading to a huge inflow of vehicles of various brands from Mexico at low prices,” Mr Mantega told the Financia Times in his office in the Esplanada dos Ministérios in Brasília. “What we want is something just, not something unequal.”

The car dispute, in which the two countries eventually settled on a temporary three-year quota system limiting the value of vehicles Mexico can export to Brazil, was as much about a clash of economic systems as it was about car imports.

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