Published in the International Trade Law and Regulation, edited by Sweet and Maxwell, volume 9, issue 1, January 2003, News Section, pages N-1 to N-2, London, United Kingdom.
By means of Resolution number 5 of 7 February 2003, the Brazilian Foreign Trade Chamber (CAMEX) has put an end to the antidumping investigation process on the imports of glyphosate originating from the People’s Republic of China into Brazil with the application of antidumping duties of 35.8% on the imports of acid, salt and formulated glyphosate (NCM 2931.00.32, 2931.00.33 and 3038.30.23) originating from China. It is to be noted that the dumping margin requested by the petitioner, in the opening of the investigation on 28 August 2001, was 115%.
Nevertheless, Brazilian authorities concluded that the Chinese glyphosate sector does not operate under market economy conditions. Therefore, the relevant normal value was constructed by using the third country method, ruled by article 7 of Decree 1602/95. In this particular case, Brazilian authorities decided to construct the glyphosate normal value based on the prices practised in India
Brazil and Japan foresee a free trade bilateral agreement
The creation of a working group to elaborate a free trade project between Brazil and Japan is currently being studied by Brazil’s National Confederation of Industries (CNI) and by Japan’s equivalent Confederation, called Nippon Keidanren.
The Brazilian government believes in a future free trade agreement with Japan although it predicts this will only be possible in five years time. The government feels that Brazil should first increment their relations with Japan by taking advantage of market niches. Brazil’s priority should be to identify what products could be inserted in Japan’s distribution chain.
More than 200 Brazilian and Japanese entrepreneurs participated in the 10th Joint Meeting of the Economic Co-operation Brazil-Japan Committee. The meeting’s main theme was the reactivation of trade and investment as well as the creation of new partnerships.
New Route to Asia
Brazil is adopting a more daring trade policy in relation to Asian countries and with this objective two operating strategies have been developed. First of all, in order to boost and assist business between private enterprises of both China and Brazil, the Brazilian Government has decided to upgrade the status of the Brazilian Consulate in Shanghai to Consulate General which will host a specific Commercial Promotion Sector – Secom. Secondly, a commercial mission is now being prepared directed at countries with which Brazil practically does not have any commercial ties i.e. Vietnam, Cambodia and Laos.
According to the Brazilian Government the upgrade in relation to the Brazilian diplomatic representation in Shanghai will require more qualified diplomats and international trade specialists to work in Shanghai, mainly at Secom. Secom will focus on China’s private sector, conducting market research in order to estimate which sectors of the Chinese Economy will tend to absorb Brazilian products. China is at present Embraer’s target investment country, where the company will produce aircraft for the local market.
The growing trade between Brazil and Vietnam, especially in the second semester of 2002, has called the Brazilian Government’s attention to the opportunities that unconventional trade partners could bring in the future. With this in mind, a commercial mission is being organised which is expected to happen this year. The Brazilian Company Braspower in association with Russian enterprises is building hydroelectric plants in the region.
Although European, North and Latin American participation in Brazilian exports has dropped from 75.7% to 72.7% between 2001 and 2002, the three per cent deficit was replaced by non-traditional Brazilian sales’ destination countries. Efforts are being made to add Cambodia, Laos and Vietnam to such group of countries.
Brazil may retaliate against Canada
The WTO granted Brazil the right to retaliate against Canada in the amount of US$ 247,8 million regarding the long lasting commercial dispute between Embraer and Bombardier. Last year the Brazilian Government had filed a request to be granted such retaliation right, estimated at US$ 3.36 billion. The reason for the imposed penalty is the injury caused to Embraer regarding the subsidies given to Bombardier by the Canadian Government.
The retaliation value claimed by Brazil was rejected by the Canadians and therefore an arbitration committee was formed in order to set the accurate sum. The arbitrated sum is indeed much closer to what the Canadians judged to be fair than to the real injury suffered by Embraer.
Despite having the power to retaliate the Brazilian Government prefers not to use such right when so much more is at stake regarding the bilateral negotiations for the solution of the six-year dispute. However, the granting of retaliation rights against Canada represents for Brazil an incredibly important step and may be the sign that WTO’ s dispute settlement system is indeed effective.