Brazil’s Caixa to finance $1.3 billion in beef exports to Iran, Valor says

Joshua Goodman – Bloomberg, 08/13/2010

Brazil’s state-controlled Caixa Economica Federal will finance up to 1 billion euros ($1.3 billion) in beef shipments to Iran after private banks refused to extend credit to exporters, fearing retaliation from the U.S. and European Union, Valor Economico said.

The financing will be backed by Brazil’s Treasury, which will be responsible for collecting payment from the Iranian government, the Sao Paulo-based newspaper said.

Sanctions imposed by the United Nations in June over Iran’s nuclear program, and followed up with tighter restrictions by the U.S. and EU, has led Brazilian banks to reject credit guarantees issued by Iranian banks, the newspaper said.

President Luiz Inacio Lula da Silva, in a visit to Tehran in May, signed an agreement to finance food exports to Iran, as well as boost investment and expand air connections between the two countries. Annual trade with Iran has more than doubled to $1.2 billion since Lula took office in 2003.

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Brazil will back Iran sanctions

Al Jazeera, 08/11/2010

Brazil’s president has signed a decree stating his country will abide by United Nations sanctions against Iran even though it had worked to avoid them.

Luiz Inacio Lula da Silva, the president, signed the decree “because there is a tradition of carrying out [UN] Security Council resolutions, including those we don’t agree with,” Celso Amorim, the foreign minister, told reporters.

The decision to take the formal step of signing a decree also comes after Iran last week dismissed a Brazilian offerto give asylum to an Iranian woman who has been sentenced to death by stoning for adultery.

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Fight between U.S. and Brazil threatens trade

Brian Winter and Natuza Nery – Reuters, 08/05/2010

The road to rock bottom for relations between Brazil and the United States, a dispute that now threatens business ties between the two Western Hemisphere economic giants, began in Brasilia in March.

Secretary of State Hillary Clinton was trying to convince Brazilian President Luiz Inacio Lula da Silva to drop or postpone his controversial efforts to negotiate a nuclear deal with Iran, and support a new round of sanctions instead.

Lula refused. Then, he dropped a diplomatic bombshell, telling Clinton he was worried Iran would become another Iraq — that is, that the United States was on a path to war, according to sources familiar with the exchange.

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Turkey, Iran, Brazil holding talks on nuclear plan

Voice of America News, 07/24/2010

Turkey’s foreign minister says Iran is ready to hold talks on its nuclear program with the European Union after the Muslim month of Ramadan ends in September.

The foreign ministers of Iran, Turkey and Brazil met in Istanbul Sunday to discuss Iran’s next steps for nuclear negotiations.

Turkish foreign minister Ahmet Davutoglu says Iran will send a letter to the International Atomic Energy Agency Monday, asking to start “technical” negotiations on a nuclear fuel swap.

The United Nations Security Council imposed a fourth round of sanctions against Iran in June after the country did not accept a U.N.-backed plan to swap low-enriched uranium for uranium fuel rods needed for an Iranian medical research reactor.  The deal would have reduced Iran’s uranium stockpile and delayed its capability to produce nuclear weapons.

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World powers mull Brazil, Turkey’s presence in Iran talks

AFP, 07/12/2010

World powers have not formally agreed that Brazil and Turkey can sit in on talks over a nuclear fuel supply deal with Iran, but neither have they explicitly ruled out such an arrangement, diplomats said Monday.

An Iranian news report on Sunday quoted Tehran’s foreign minister Manouchehr Mottaki as saying that the so-called Vienna group “has accepted” the presence of Brazil and Turkey in talks over a fuel swap.

But diplomats familiar with the dossier said no such formal decision had been made.

Under a deal brokered by the International Atomic Energy Agency (IAEA) last October, France, Russia and the United States proposed to Iran that it ship out most of its stockpile of low-enriched uranium for processing into fuel rods for a medical research reactor in Tehran.

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Brazil ends role as Iran broker

Daniel Dombey and Jonathan Wheatley – Financial Times, 06/20/2010

Brazil is halting its attempt to broker a deal over Iran’s nuclear programme – an issue that has brought relations between the Lula da Silva government and the Obama administration to a new low.

Celso Amorim, Brazil’s foreign minister, told the Financial Times the country would no longer seek to settle the nuclear dispute after the US rejected a Turkish-Brazilian deal with Iran to exchange half Tehran’s stockpile of enriched uranium for nuclear fuel for a research reactor.

“We got our fingers burned by doing things that everybody said were helpful and in the end we found that some people could not take ‘yes’ for an answer,” said Mr Amorim in a clear reference to Washington.

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Brazil in the Middle East: A regional power in a changed hemisphere

Michael Werz and Winny Chen – The Center for American Progress, 06/17/2010

The vote two weeks ago by the United Nations Security Council to enhance sanctions on Iran was yet another indication that traditional power structures in international affairs are slowly but steadily shifting. The U.N. resolution—a response to Iran’s continued efforts to build a nuclear weapon—will expand the existing arms embargo, freeze Iranian assets, and prevent the regime from acquiring technology for ballistic missiles. Brazil and Turkey, both close partners of the United States until very recently, were the only dissenters among a total of 15 Security Council members, and both voted against the measure, openly distancing themselves from the Obama administration and the world community.

Brazilian President Luiz Inácio Lula de Silva and his Turkish counterpart Recep Tayyip Erdoğan negotiated a preliminary deal with the Iranian government on uranium enrichment in recent weeks, attempting to stamp their respective countries’ tickets for the diplomatic big league. The initiative irritated the United States, Russia, and Europe, but the Security Council ultimately brushed it aside when permanent member country representatives argued that “the swap proposal negotiated by Brazil and Turkey would leave Iran with enough material to make a nuclear weapon,” noting that “Iran intends to continue a new program of enriching uranium to a higher level.”

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An Iranian banana skin

The Economist, 06/17/2010

ALTHOUGH Brazil has been a member of the UN Security Council on ten separate occasions since 1946, it had never before voted against a resolution backed by a majority of the council’s members. But on June 9th Brazil and Turkey both opposed further sanctions against Iran. In doing so it was out of step not just with its old allies, the United States and the European powers, but also with its new ones, Russia and China, all of which are worried by Iran’s nuclear programme. Why has the government of Luiz Inácio Lula da Silva stuck its neck out so far for Iran?

The short answer is that Lula, a former trade-union leader, fancies himself as the man who can talk Iran into obeying the world’s nuclear rules, and thinks sanctions will bring that effort to nought. Last month he flew to Tehran for talks with Iran’s president, Mahmoud Ahmadinejad, and Turkey’s prime minister, Recep Tayyip Erdogan. The three countries signed an agreement under which Iran would send to Turkey 1,200kg of its low-enriched (under 5%) uranium stocks; in return it would receive within a year more highly enriched (to 20%) fuel rods for its ageing medical-research reactor. Iran’s leaders also agreed to tell the International Atomic Energy Agency (IAEA) in writing of this plan. “We thought this was a gesture by them, a first demonstration of trust,” says Marco Aurélio Garcia, Lula’s foreign-policy adviser.

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Exotic and immature diplomacy

Sérgio Malbergier – Folha de São Paulo, 06/10/2010

The defeat of Brazilian diplomacy in the UN Security Council on the vote for further sanctions against Iran needs to be deconstructed.

There is a victory underneath this defeat. The name “Brazil” appears in all of the news surrounding the issue. If the Americans are certain that there are no negative intentions, Brazil’s diplomatic self-assertion, even though defeated and mistaken, brings some benefits.

The stature and global projection of Brazil grew enormously in the Lula era, a result of his efforts and of increasing economic clout. Combined, economic development and political-institutional stability distinguish Brazil from the other emerging economies.

But the quality of our economic foreign policy is far superior to that of our political foreign policy. In forums such as the IMG, the G20, the WTO and the BIS (Bank for International Settlements), our leadership is less strident and more pragmatic.

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