China or India? Or both? Brazilian Foreign Policy post the Election

In the last week of October 2022, the final round of Brazilian presidential elections will be held. The two contenders are the current president, Jair Messias Bolsonaro, a far-right politician temporarily affiliated with the Liberal Party, and the former president, Luiz Inácio Lula da Silva, a center-left politician affiliated with the Workers’ Party.

Foreign policy matters had figured in election campaigning. With the competition between major powers particularly between the U.S. and China intensifying, Brazilian researchers and international observers were trying to understand the vision that the two candidates have for Brazil’s relationship with Asian major powers, particularly, with China and India.

Official program documents from Bolsonaro and Lula da Silva did not mention their plans for future relations with the two Asian powers. However, each of the candidate’s past preferences towards India and China can serve as an indicator for Brazil’s future foreign policy approach. With Lula da Silva, we must look at the period between 2003 and 2011 and, in Bolsonaro’s case, the period between 2019 and 2022.

Lula da Silva and the “Active and Proud Diplomacy”

In the first decade of the 21st century, relations between the U.S., China, and Russia were quite different. At the time, Washington was engaged in the war on terror. President Lula da Silva declared a few years later that President Bush had asked Brazil to take part in the fight against terrorism and support the invasion of Iraq to which he had refused to offer such type of support. Despite this negative response from Lula, relations between Brazil and the U.S. remained friendly. However, at the beginning of the 21st century, it became clear to Brazilian observers that American influence in global affairs was in decline. The resurgence of Russia (particularly its active foreign policy) along with fast and impressive rise of China, India, and to an extent Brazil itself as emerging economies established a new trend in the international order. Eventually, Brazil became a key country for the formulation of the BRICS (Brazil-Russia-India-China-South Africa) in later years. Lula da Silva’s Minister of Foreign Affairs, Celso Amorim, described Brazilian international relations at the time as an “active and proud foreign policy”. Brazil executed a diplomatic reorientation toward the so-called “Global South” in search for partnerships with South American, African, and Asian countries.

In Asia, Brazil’s foreign policy priority was diplomatic relations with China and, to a lesser extent, with India. With China, a strategic partnership began in the previous decade, between 1993 and 1995, but deepened during the Lula da Silva administration. From 2002 to 2006, trade between Brazil and China increased from US$3.230 billion to US$16.392 billion, reaching at the end of the 2010s, a total of US$ 56.381 billion.

Around the same time in 2006, Lula da Silva and Indian Prime Minister Manmohan Singh also signed a commitment to implement a strategic partnership. Trade between Brazil and India grew from US$500 million in 2002 to US$2.3 billion in 2006. Besides fruitful trade contacts, India and Brazil also share a common diplomatic interest in reforming the United Nations Security Council membership. Both wanted to be veto-power members along with the US, Russia, China, France and the United Kingdom.

The high importance of China and India to the Brazilian government during the Lula da Silva period was institutionalized in the formation of the BRICS, created in 2006 by Brazil, Russia, India, and China. In 2011, South Africa officially became the fifth member. In addition to economic issues, BRICS signaled the political ambition of its members: a reform of the world order, especially in some key institutions.

In 2008, the global financial crisis across the world including in the U.S. offered an opportunity to China to reposition itself in global affairs. In fact, China responded to this event by developing a more incisive diplomacy during the 2010s in Latin America, seeking to ensure better economic and political partnerships. Such diplomacy was beneficial to Brazil, and China became Brazil’s biggest trading partner, surpassing the United States, under Lula da Silva’s regime.

Jair Bolsonaro and the Limits of an Ideological Foreign Policy

Between 2016 and 2019, there were controversial political events in Brazil. Lula da Silva’s successor, Dilma Rousseff, suffered a controversial impeachment by the Brazilian congress in 2016. President Lula da Silva himself was convicted in Operation Car Wash and, after 580 days in prison, set free due to major procedural errors and suspicions that his trial was politically motivated. A huge economic crisis befell Brazil during this period, and it was partially caused by the Operation Car Wash against state-owned companies. Brazilian economic grievances were further aggravated by the Coronavirus Pandemic in 2020. Despite an increase in economic and trade contacts, political links with the BRICS partners had greatly weakened.

Shortly after Bolsonaro took office in 2019, there was a deepening of diplomatic and military cooperation with Washington, evidenced in the president and some Brazilian Ministers of State making several negative references to China, showing an automatic alignment with the Americans. What facilitated the alignment with the U.S. at the time was the ideological identification with the extreme right-wing values outlined by President Donald Trump.

After Trump’s defeat in the 2020 election, President Bolsonaro made several clumsy statements and moves. He publicly cast doubt on the honesty of the American electoral process and was the last international leader to congratulate Joe Biden on his victory. As a result, the relationship between Brasilia and Washington grew cold. Practically speaking, it is the necessity to revive the Brazilian economy that prevailed over any pretense of ideology. China emerged as an obvious partner in Bolsonaro’s foreign policy. In 2019, Xi Jinping and Jair Bolsonaro made joint statements on the importance of strategic relations between Brazil and China and on the common interest in strengthening BRICS. The coronavirus pandemic further complicated the situation. Despite President Bolsonaro echoing President Trump’s initial xenophobic speech on the “Chinese virus”, it soon became clear that the global economic downturn would increase Brazil’s dependence on the Chinese market. This was most illustrated by the absence of U.S. leadership during the global fight against the pandemic which cleared the space for China to exercise “vaccine diplomacy”. While Washington exclusively reserved supplies of the first vaccine doses produced by corporations like Pfizer, Beijing was quick to establish vaccine production agreements in and with Brazil.

In relation to India, there was a positive expectation on the part of Bolsonaro and his ministers. A reason for this expectation lies in the ideological affinity between the Brazilian president and the Indian prime minister. In Brazil, many see Indian Prime Minister Narendra Modi as a member of the global far right, and Bolsonaro’s first trip to India came just a month after Donald Trump’s visit in 2020, reinforcing the perception of the ideological affinity between the Brazilian, Indian, and American leaders.

Despite these expectations, however, the relationship between New Delhi and Brasília has not been impressive. Rather, it’s been a low profile one. In fact, trade between the two countries in 2021 reached US$11 billion, projected to touch only US$15 billion by the end of 2022, but the strategic partnership between the two has not progressed beyond the agreement signed in 2006.

The most delicate point in the relationship between Brazil and India occurred during the coronavirus pandemic. India and South Africa pressured the World Trade Organization to authorize the suspension of patents on vaccines and drugs against COVID-19. Brazil aligned itself with the U.S. and the European Union against this proposal, a decision taken by the Bolsonaro administration in response to an appeal by President Donald Trump. Without support from the WTO, the Indian government discarded Brazil from the priority list to receive vaccines. The Brazilian position caused economic and diplomatic setback to India and led to a cooling-off in relations between the two.

Will Brazil’s Relations with China and India Improve?

In Brazil, a consensus is being generated that a reorientation of Brazilian foreign policy is necessary. For Brazil, China will continue to be a priority. Brazil needs more foreign investment in its infrastructure in order to improve the competitiveness of its economy. In 2021, Brazil was China’s top investment destination. Chinese companies have invested around US$5.9 billion in the Brazilian key sectors such as electricity, oil, and information technology. Furthermore, Lula da Silva, has projects to encourage industrial production in traditional areas such as the automobile industry, oil, aeronautics, and the naval sector, but also in so-called green, or clean technologies, such as solar energy. The Chinese not only have know-how in these sectors but are already familiar with the Brazilian economy and have shown an interest in increasing investment.

Regarding relations with China, the new Brazilian president will have to balance its ties with the Americans. Washington does not want its main geopolitical rival, Beijing, to further increase its presence in Latin America and Brazil. The Trump and Biden administrations had previously pressured the Bolsonaro government to avoid Chinese companies, such as Huawei, in Brazilian 5G networks. More such pressure can be expected if Brazil tries improving diplomatic and economic links with China.

Given its importance in contemporary international politics, one can expect India to be a strategic priority for Brazil in the foreseeable future. In addition to economic considerations, the geopolitical factor is also interesting. To date, there have been no U.S. restrictions on Indian investments in Brazil. Considering that Washington has attempted to bring India to its side in the competition with China, a positive attitude from Americans in a rapprochement between Brasilia and New Delhi is expected. Moreover, India, given its rising economic power and influence in global affairs, has become a viable alternative to China that Brazil can rely on, even if it cannot replace it.

For Brazil, it becomes clear that it has to strengthen partnerships with both China and India. This would allow greater room for maneuvering and bargaining power in defense of Brazilian strategic interests in Asia and global affairs. Yet, to what extent Brazil with its new president can have an equipoised relationship with both China and India, without heavily displeasing the U.S., needs to be seen.