Bolsonaro’s Foreign Policy and the Brazilian Bourgeoisie

A política externa de Bolsonaro e a burguesia brasileira

Abstract

This article analyses the Bolsonaro government’s foreign policy and the interests of the Brazilian internal bourgeoisie. The hypothesis is that the internal bourgeoisie supported the 2016 coup d’état and the 2018 election of Jair Bolsonaro but, over the years, they started to exhibit resistance to the government’s political practices and responded to the external pressures related to environmental policy and threats to democracy. The empirical research analysed the position papers of the internal bourgeoisie’s main employer organisations, focusing on the following agendas: i) the Mercosur-EU agreement; ii) entry into the OECD; iii) reformulation of Mercosur’s Common External Tariff (CET); and iv) environmental policy. The study concludes that there were conflicts within the internal bourgeoisie throughout the Bolsonaro administration and, in the end, there was a change in their interests that, alongside other elements, can explain Jair Bolsonaro’s 2022 electoral defeat.

Keywords
Bolsonaro administration; Brazilian foreign policy; Brazilian bourgeoisie; Mercosur

Resumo

Este artigo faz uma análise sobre a política externa do governo Bolsonaro e os interesses da burguesia interna brasileira. A hipótese é que a burguesia interna teria apoiado o Golpe de 2016 e a eleição de Jair Bolsonaro em 2018, mas, ao longo dos anos, passaram a apresentar resistências em relação às práticas políticas do governo e às pressões externas sobre a política ambiental e as ameaças contra a democracia. Realizamos uma pesquisa empírica nos documentos de posição das principais entidades patronais da burguesia interna com foco nas seguintes pautas: i) acordo Mercosul-UE; ii) ingresso na OCDE; iii) reforma da Tarifa Externa Comum (TEC) do Mercosul; e iv) política ambiental. Conclui-se que ao longo do mandato existiram conflitos no interior da burguesia interna, e ao final, passou a existir uma mudança dos interesses dessa fração que, ao lado de outros elementos, podem explicar a derrota eleitoral de Jair Bolsonaro em 2022.

Palavras-chave
governo Bolsonaro; política externa brasileira; burguesia brasileira; Mercosul; OCDE

Introduction

This article analyses the relation between Jair Bolsonaro’s foreign policy and the interests of Brazil’s internal bourgeoisie. It questions whether the strategy anchored in neoliberal policy and passive and explicit subordination to the USA has received support from this class fraction. The hypothesis is that the internal bourgeoisie supported the 2016 coup d’état and the election of Jair Bolsonaro in 2018 but, over the years, they came to resist the government’s political practices and to respond to the external pressures related to environmental policy and threats to democracy. This fraction of the Brazilian ruling class had been the driving force behind the neo-developmentalist programme in the Workers’ Party (PT) governments (2003-2016), having benefited from the South-South cooperation foreign policy agenda through selective protectionism (government purchases, BNDES [Brazilian Development Bank] funding, and a negotiating stance on international agreements) and the search for foreign markets and territories in which to set up their companies (Berringer 2015). In 2013 they began to demand changes in the international insertion of the Brazilian state (Berringer 2023).

This is because this fraction has joined the neoliberal-orthodox political field, composed of the associated bourgeoisie, the upper middle class, and international finance capital (Boito 2021). The reason for this change was the expectation that neoliberal reforms would increase the rate of profit and the international competitiveness of Brazilian products and services. They also expected the conclusion of new trade agreements that could foster opportunities to attract foreign investment. The Mercosur-EU agreement and OECD membership are cases in point. Additionally, they sought to reduce the Brazilian state’s support for the governments of the so-called ‘Pink Tide’ in the region, since the anti-imperialist character and distributive policies of governments like Nicolás Maduro’s in Venezuela appeared to threaten the interests of the Brazilian ruling classes.

In this sense, foreign policy played a fundamental role in the reconfiguration of the Brazilian power bloc under the Temer (Reis and Berringer 2018) and Bolsonaro administrations, especially in terms of rapprochement with the United States and the change in the Brazilian state’s political position in South America. The political and economic programme of both governments encompassed the neoliberal agenda. It included the approval of labour and social security reforms and the reduction in state spending on health and education, as well as the privatisation of strategic sectors such as oil and energy. Temer’s administration differed from Bolsonaro’s in that the latter adopted a neo-fascist policy, characterised especially by exacerbated nationalism, obscurantism, conservatism, sexism, elitism, anti-communism, and racism (Souza 2023). Temer was responsible for the neoliberal agenda and the return of the state passive subordination to imperialism. Bolsonaro’s government, especially in the first two years (2019 and 2020), made it explicit when he reproduced the discourse and ideology of Trump’s administration.

This article is the result of empirical research that analysed the position papers of the main employer organisations that politically represent the Brazilian internal bourgeoisie (CNI, FIESP, ANFAVEA, ABIMAQ, ABIT, CNA, ABAG and APROSOJA)¹ on the following agendas: the reformulation of Mercosur’s Common External Tariff (CET); Mercosur-EU, OECD, and environmental policies. The aim was to understand the position of each organisation and the existence or not of conflicts between them and, from there, ascertain whether they supported the Bolsonaro government’s foreign policy. The conclusion is that, although the different organisations converge on some neoliberal agendas, over the years they have resisted the Bolsonaro government’s foreign and domestic policies, especially those related to environmental and democratic issues. Thus, the internal bourgeoisie ultimately positioned itself in favour of Lula’s candidacy.

The article is divided in three sections: 1) a theoretical section, in which the main concepts used throughout the text are presented; 2) a section on the Bolsonaro government’s foreign policy, with a short summary of its main characteristics and actions on the international political stage; and 3) the third section provides a systematisation of the empirical research, describing the interests and positions of the big internal bourgeoisie over the four years of the Bolsonaro government (2019-2022).

Theoretical background

Nicos Poulantzas’ theory of the state is the framework used in this article. In particular, the concepts of power bloc and internal bourgeoisie drive the analysis of foreign policy (Berringer 2015). For this Marxist author, the capitalist state corresponds to a legal-political structure that is fundamentally characterised by two elements: formally egalitarian law and universal institutions. These elements, in turn, are the basis of the capitalist state’s bureaucratism and its relative autonomy. Thereby, the state presents itself as the representative of the nation, through which it legitimizes its monopoly over the use of force and, for this reason, has become the factor of national cohesion. It is precisely through this that the state guarantees the maintenance and reproduction of the capitalist mode of production. The state’s role is fundamental to maintaining sovereignty, private property, and wage labour. As a result, the bourgeoisie does not need to directly compose the body of state officials or organise its own political party (Poulantzas 2019).

The national ideology of the state, contained in the idea of representing the unity of the nation-people, fulfils the function of concealing the class character of the state, as it manages to isolate and disorganise the working classes. This is what Saes (1998) called the double effect of the legal-political structure of the capitalist state: unity and isolation. It means that, from a strategic point of view, the capitalist state organises the interests of the dominant classes while repressing and disorganising the dominated classes. This refined reading of the role of the state and national ideology, along with the concept of power bloc, are very important for theoretical studies of international relations (Berringer 2014, 2015). The power bloc concept comes from the assumption that the bourgeoisie is not a homogenous class, especially when it comes to the different phases and forms of the reproduction of capitalism. The class fractions are determined by function, size, or origin of capital: they can be classified as commercial, industrial, banking; medium, small or big capital; and national capital or foreign capital (Poulantzas 2019). This division stems from national and international political circumstances, social conflicts, and disputes over control of state policy (exchange rates, interest rates, investments, trade openness or protectionism, etc.) (Farias 2009).

The power bloc is a contradictory unity between the dominant classes and class fractions. This is because the fractions have an objective unity when it comes to maintaining the capitalist mode of production (CMP), but conflict at times of greater political stability (when there is no revolutionary crisis) over state policies on the distribution of the wealth produced and the benefits and protection they can receive. For this reason, the power bloc is organised through the hegemony of one of the fractions, which manages to have its interests prioritised by the state and, at the same time, manages to present itself as representing the general interests of that national society (Poulantzas 2019). This can happen around a national developmentalist agenda, an expansionist platform, or even an austerity and monetarist goal. To this end, a discourse is constructed that aims not only to maintain the amalgamation of the dominant classes and class fractions, but also of the popular classes as a whole, which could become part of an alliance or political front with the power bloc.

With regard to the dominated classes, Poulantzas also analyses them based on the idea of cleavages. There can be layers and categories, such as the bureaucracy, the new petty bourgeoisie (or the middle class), the marginalised sectors, the workers, the peasantry, etc. The relationship between the dominated classes and the state is primarily inscribed in their relationship with the power bloc: in the possibilities of workers’ movements, trade unionism, and popular movements to produce relevant effects on the situation, either through political actions and mobilisations or by taking part in alliances or political fronts with certain fractions of the bourgeoisie. The state can, therefore, in certain situations, respond to the demands of the dominated classes on account of the unstable balance of compromise, i.e. the maintenance of the capitalist mode of production, or on behalf of the alliance or political front that the government in question represents (Poulantzas 2019).

Berringer (2015) argues that a state’s international position also depends on the power bloc. In other words, the hegemonic fraction determines the general orientation of the state’s foreign policy, which can then be altered. Based on the Poulantzian cleavage of the bourgeoisies in dependent social formations, Berringer (2015) argues that foreign policy can assume the following political positions: passive subordination, conflictive subordination, and anti-imperialism, respectively linked to the hegemony of associated, internal, or national bourgeoisies. The relationship between these fractions and the dominated classes varies, also respectively, as follows: opposition, building of a political front (unstable and flexible), and alliance/support, as shown in the table below.

Table 1 Relations between the hegemonic fractions of the power blocs and foreign policy

Hegemonic fraction	Popular classes	Foreign policy
National bourgeoisie	Alliance/support	Anti-imperialist
Associated bourgeoisie	Opposition	Passive subordination
Internal bourgeoisie	Political Front	Conflictive subordination

Source: own elaboration.

The internal bourgeoisie corresponds to an intermediate fraction between the associated bourgeoisie and the national bourgeoisie. It depends on foreign capital financially and technologically, but conflicts with it for its own survival, requiring greater room for manoeuvre from the state on the international stage (Poulantzas 1978). Despite this, this fraction does not take an anti-imperialist stance like the national bourgeoisie, which is more focused on the domestic market. Neither does it have a political-ideological position of being a mere transmitter of imperialist interests within the dependent social formation like the associated bourgeoisie, a fraction that depends almost entirely on foreign capital and, therefore, becomes its minor partner and accepts passive subordination without conflicts with imperialism (Farias 2009). The difference between the alliance and the political front is that the former is part of a political project that aims to unify the interests of the dominant and dominated classes, while the latter represents a convergence of political interests at a given juncture, and is, therefore, more flexible and unstable.

The power bloc can function as a condominium between a hegemonic fraction, which controls state policy and presents itself socially as a representative of general interests; a reigning fraction, which is part of the government and also controls state policy; or a holding fraction, which controls state policy but does not present itself on the political stage as a representative of national unity, often because it is unable to present itself as such. This can happen, for example, with the bourgeoisie linked to financial capital. Since it offers few gains in terms of economic growth and job creation, it cannot exercise political-ideological domination. And these situations depend on the correlation of forces within and outside the social formations. A conjunctural alliance can also be formed between two class fractions in the name of certain tactical objectives, such as attacking labour rights and reducing the role of taxes. This is what is investigated in more detail in the third section of the article.

Bolsonaro’s foreign policy and the power bloc

The first two years of the Bolsonaro administration’s foreign policy were marked by an explicit passive subordination to imperialism, notably based on the alliance with the Trump administration (Berringer et al. 2020). Brazil-USA bilateral relations were inscribed in the common agenda of anti-globalism, negationism in relation to COVID-19, Sinophobia (Sousa et al. 2022), and in the practices and discourses of the domestic policies they adopted in relation to certain social segments (Guimarães et al. 2023). Their strategy comprised the neoliberal programme, the ‘anti-globalist’ agenda (Araújo 2017), and a series of actions, which we will detail below.

Brazil-USA relations became a high priority on the government team’s political agenda (Thomaz and Vigevani 2023). It was made clear by President Bolsonaro’s various visits to the United States during his term in office. Also noteworthy was Mike Pompeo, US Secretary of State, and Robert O’Brien’s visit to Brazil in 2020 (Benites 2020) and the so-called ‘Agenda for Prosperity.’ The set of bilateral meetings included the following agenda items: the aggression against Venezuela (Araújo and Murakawa 2019), the Technological Safeguards Agreement for the use of the Alcântara base in Maranhão state, the request for US support for Brazil’s entry into the OECD (Azzi 2020), and the status of extra-NATO ally conferred on Brazil (Agência Brasil 2019). The visit of the president, six cabinet ministers, and his son, Eduardo Bolsonaro, to the Central Intelligence Agency (CIA) (Rittner and Basile 2019) was the first official visit by a Brazilian president to the US agency.

Given that Donald Trump’s government (2017-2021) also spearheaded a movement of white and middle-class people in the United States who were unhappy with the effects of neoliberalism in their country, implementing a ‘hyper-reactionary’ neoliberalism (Fraser and Jaeggi 2018), the alliance between the two governments also had the support of the Brazilian community living in the USA, especially of that in Miami, a city that ended up being the scene of Bolsonarist demonstrations during the president’s various trips to the country.

In addition, a series of actions by the Brazilian state on the international stage stand out, namely: the attempt to move the Brazilian embassy in Israel from Tel Aviv to Jerusalem (Schutte et al. 2020); the votes at the UN on the Palestinian question and on gender issues (Motta and Milani 2023); the position in defence of the embargo on Cuba at the OAS (it was the first time, after almost 50 years, that the Brazilian state voted in favour of the embargo); the withdrawal of the Brazilian state from the Migration Pact; the failure to host climate conferences; Brazil’s support for the candidacy of the American Mauricio Claver-Carone for the presidency of the Inter-American Development Bank (IDB) (Uol 2020), among other actions.

Trump and Bolsonaro also showed strong synergies in relation to the COVID-19 pandemic (Tasquetto et al. 2022). Both presidents began to accuse the media and the opposition of wanting to create social panic and advocated, without scientific evidence, for the use of hydroxychloroquine to prevent and combat COVID-19. In addition to accusing China of developing the virus, they did not support the role of the World Health Organisation (WHO) in dealing with the global crisis (Tasquetto et al. 2022).

The signing of the Technological Safeguards Agreement for the use of Maranhão’s Alcântara base was an agreement that assaulted territorial sovereignty and deepened the country’s technological dependence (Berringer et al. 2020). It involved deeper clauses than those in the Fernando Henrique Cardoso (FHC) government’s Protocol 505, which proposed ceding control of the Alcântara launch base in 2000. As far as sovereignty is concerned, the agreement does not allow Brazilian authorities access to the base’s territory and they have no control over the equipment that will enter the site. It also places limits on the use of the resources from the rent, prohibiting it from being used for investment in aerospace technology. This agreement also reveals how the USA is pressuring the Brazilian state to remain dependent on it. The USA pressured the Brazilian state to review access to 5G technology with the Chinese company Huawei (Sousa et al. 2022), threatening to withdraw from the Technological Safeguards agreement. However, the Brazilian state did not comply with this pressure, given that there were also many domestic mobilisations calling for the implementation of 5G to go ahead (Berringer et al. 2020).

Sino-Brazilian relations had to deal with many Sinophobic statements from the Bolsonaro government during the COVID-19 pandemic. But despite this, it was not possible to break diplomatic and economic relations, given the high level of trade and financial exchanges between the two countries (Sousa et al. 2022). Thus, economic relations were maintained, Brazil accessed the BRICS bank seeking funding for strategic areas such as energy, and China became the largest foreign investor in Brazil (Sousa et al. 2022).

Membership of the OECD, the ‘rich countries club,’ is seen by supporters as a ‘quality label’ that would guarantee security for foreign investors. Joining the group is not a mere formality but would result from changes in national policies. Such changes are analysed by the OECD’s thematic committees, which are not limited to Trade and Investment, but involve the following areas: Agriculture, Fisheries, Health, Education, Science and Technology, Corporate Governance, Environment, Chemicals, Insurance and Pensions, Territorial Development, and others (Azzi 2020). In other words, in addition to the labour and social security reforms, alongside the set of privatisations that the Bolsonaro government signalled it would undertake, tax and administrative reforms would also be included in this list. The OECD candidacy, defended by Paulo Guedes’s Ministry of Economy (Guimarães et al. 2023), did not win the expected support from the USA, even though support for Brazil included a request that it abandon the WTO’s Special and Differential Treatment by the USA, which entailed heavy losses in trade and political engagement. In fact, Brazil’s current status as a key partner of the OECD (non-founding member with a strong commitment) makes the need for such an endeavour questionable. Azzi (2020) rightly calls this initiative subordination by accession.

Regional policy suffered the most changes from the end of the PT (Worker’s Party) governments through the Temer and the Bolsonaro administrations. Initiatives such as UNASUR were dismantled, Brazil withdrew from CELAC, and it was encouraged to create competing mechanisms (Botão 2022), such as the Lima Group and the Forum for the Progress of South America (Prosul)². The Brazilians state’s support for the war against the government of Nicolás Maduro is worth highlighting as it is part of a context of reorganisation of the region’s power blocs around neoliberal projects that are passively subordinated to the interests of the United States (Botão 2022). Aggressions against the Venezuelan state have intensified since the Bolsonaro administration, and there has been open interest, as early as 2019, in overthrowing the Maduro government with the participation of the United States (Araújo and Murakawa 2019). To this end, the Trump and Bolsonaro governments began a broad process of political destabilisation of the neighbouring country, using the flow of migrants to Colombia and Brazil as propaganda to justify military action. Additional actions included collaboration with the formation of a puppet government, parallel to Maduro’s and led by Juan Guaidó, and attempts to encourage insubordination in the barracks (Poder 360 2019). The result of this interference was the failed coup attempt on 30 April 2019. After this event, the threats of armed intervention by a coalition of Brazilians and Americans diminished.

In the case of Bolivia, there was a coup d’état in 2019, which promptly received the support of the United States and the Brazilian and Argentinian states, then governed by Macri. Brazil and Argentina recognised the government of self-proclaimed President Jeanine Áñez, breaking with the tradition of non-intervention in internal affairs in Brazilian foreign policy (Brasil de Fato 2020).

In relation to Mercosur, Bolsonaro’s government adopted a policy of weakening its political and social commitments and attempted to reduce the Common External Tariff (CET). It sought to make the Customs Union more flexible in order to consolidate the model of open regionalism that was already being implemented in the bloc. The initial proposal was for a 50% linear reduction in the CET rate. The tariff arrangement is laid down in the Mercosur Common Nomenclature (MCN), as follows: 0-12% for raw materials; 12-16% for capital goods; 18-20% for consumer goods. The agreement reached in 2021 ended up providing for a 10% reduction in tariff rates for most of the products on the trade agenda, subject to the bloc’s existing tariff exceptions in sectors such as the automotive and sugar-alcohol sectors, thus signalling a change in the government’s initial proposal (Botão 2023).

With the end of the Macri government and the return of the Justicialist Party to power in Argentina, the political dialogue between the Brazilian and Argentinian governments ended (Botão 2022). The Bolsonaro government then began to treat the new Argentinian government as an enemy, and refused to greet President Alberto Fernández, who was elected in 2020. This situation of mistrust led to a cooling of relations between the two countries, which deepened further due to differences in economic and foreign policies. The impasse would affect the future of Mercosur and the progress of negotiations on the Mercosur-EU and Mercosur-South Korea agreements (Botão 2022, 2023).

The alliance between the Trump and Bolsonaro governments was also present in the 2020 USA elections and had an effect on Brazilian politics. The US presidential candidate Joe Biden, from the Democratic Party, stated his concern about environmental devastation in Brazil and that, if elected, he would propose international governance of the Amazon rainforest, raising US$20b. Bolsonaro reacted by saying:

We’ve just seen a major candidate for head of state say that if I don’t put out the Amazon fire, he’ll raise trade barriers against Brazil. And how can we stand up to all this? Diplomacy alone won’t do it, will it, Ernesto? When you run out of saliva, you have to have gunpowder, otherwise it won’t work. (El País 2020)

After that, Bolsonaro was slow to recognise Biden’s victory. Influenced by the Brazilian ambassador in Washington, Nestor Forster, he also supported the invasion of the United States Capitol on 6 January 2021 (Folha de São Paulo 2020). In March 2021, a period of ‘musical chairs’ began. With the beginning of the COVID-19 Parliamentary Commission of Enquiry and pressure from the legislature, the minister of foreign affairs, Ernesto Araújo, stepped down as head of Brazilian diplomacy (Sanches 2021). After that, the US ambassador to Brazil, Todd Chapman, a strong Trump ally, announced that he would retire and leave the country in 30 days (US Embassy 2021). Then, Carlos França took over the Brazilian Ministry of Foreign Affairs and tried to maintain the general orientation of the Bolsonaro government’s foreign policy, with a less inflammatory discourse. The explicit character of the Brazilian state’s passive subordination to imperialism was toned down, but the neoliberal policy orientation was maintained (Souza 2023; Sousa et al. 2022).

In the next section, we will show how this was intertwined with the interests and positions of the Brazilian internal bourgeoisie, in particular its discontent with certain foreign trade policy guidelines and with Brazil’s own international insertion in terms of the reaction of the USA and the European Union to Brazil’s environmental, human rights, and democracy policies.

That is because Joe Biden reinserted the USA into the Paris Agreement and called the Climate and Democracy Summits (G1 2021). Meanwhile, the Brazilian government continued with its policy of deforestation. Bolsonaro decreed budget cuts to the Ministry of the Environment and did not present any proposals to curb the burning of the Amazon rainforest. The US Congress reacted to Bolsonaro’s policy. Senator Brian Schatz, from Hawaii, presented a bill aimed at restricting the US market’s access to raw materials originating from illegally deforested land and proposed creating an advisory committee to monitor the supply of products to the USA (Dias 2021a). This project could affect Brazilian meat exports since part of its production is on illegal land. The conflict became even more evident when a member of the US State Department said that Brazil would only receive financial aid from the global community, promised by Biden in the 2020 presidential debates, if it showed effective results in actions against illegal deforestation in 2021, ‘without waiting five or ten years, or commitments in 2050’ (Dias 2021b).

These issues have also marked relations between Brazil and the European Union. The conclusion of the Mercosur-EU Agreement negotiations in 2019 was one of the most important achievements of the Bolsonaro government’s foreign policy agenda. However, strong social and political mobilisation began to emerge in Europe against the agreement. In particular, small farmers, environmentalists, workers, and heads of state spoke out against Brazil’s policy of deforestation and human rights violations. They used the social and environmental commitments of the bi-regional agreement to paralyse the ratification of the agreement in European parliaments (Botão 2023; Botão, Alencar and Venâncio 2022).

At the beginning of 2022, the outbreak of the Ukrainian War brought new clashes between Brazil, the United States, and the European Union. After all, Bolsonaro did not endorse NATO’s political position, nor did he adhere to US guidelines on the issue. Coincidentally, a week before the conflict began, Brazil made a presidential visit to Russia, scheduled months earlier. On that occasion, Bolsonaro, despite having the status of a non-NATO ally, affirmed his solidarity with Russia:

We stand in solidarity with all those countries that want and are committed to peace. We collaborate intensively [with Russia] in the main international forums, where we defend the sovereignty of states, respect for international law and the United Nations Charter. (Prazeres 2022)

He also declared that the war in Ukraine would be ‘a good opportunity for us [Brazilians]’ (Prazeres 2022). Jen Psaki, White House spokesperson, said that Bolsonaro’s visit to Russia made it seem that Brazil ‘is on the other side of the majority of the global community’ (Uol 2022). The statement was complemented by another White House spokesperson: ‘Brazil, as an important country, seems to ignore armed aggression by a major power against a smaller neighbour, a stance inconsistent with its historical emphasis on peace and diplomacy’ (G1 2022).

After these controversial statements, Bolsonaro declared that ‘only God’ would remove him from the Presidential office. He then called a meeting with ambassadors in Brasilia to say that Brazil’s electoral system was fraudulent. The fear that something similar to 6 January would happen in Brazil took hold in Brazil and the USA. Senator Bernie Sanders, elected as an Independent, presented a draft resolution to the ‘Sense of the Senate’ calling on the United States to speak out in defence of fair and free elections in Brazil (Uol 2022b). The resolution was approved by the Senate and support guaranteed to the legally elected candidate.

In this sense, President Joe Biden was then one of the first heads of state to call Lula on his electoral victory (Krähenbühl 2022). The USA received a visit from Brazil’s new president at the start of his term in January 2023.

The power bloc and foreign policy

The Bolsonaro government’s foreign policy sought to serve the interests of the Neoliberal-Orthodox front, especially that of the associated bourgeoisie and foreign capital. The goals of the international economic insertion strategy were to attract foreign investment, to privatise strategic sectors (oil and energy), and to reduce state spending and payroll expenses. In this respect, we sustain that the internal bourgeoisie had its demands partially met, having occupied a secondary position within the power bloc. Below, we examine this fraction’s points of internal conflict and dissatisfaction over the four years of Bolsonaro’s government.

Thomaz and Vigevani (2023) affirm that, for Brazil-USA relations, the importance of bilateral trade is met with an interest in increasing its flow, as well as increasing the flows in investments and services. In 2020, the Brazilian National Industry Confederation (CNI), the Brazil-USA chamber of commerce (Amcham), and the Brazil-USA Business Council delivered a demand letter to the United States Trade Representative Office (USTR) calling for a free trade agreement between the two states. This was a long-standing demand from industrial sectors, based on the expectation of increasing Brazilian exports to the United States. Instead, there was an increase in import quotas for ethanol, steel, and aluminium from Brazil to the USA and the implementation of restrictions on wheat imports from the USA to Brazil.

In the end, despite the fact that the proposal violated Mercosur’s internal commitments, it was vetoed in the US Congress because of the Bolsonaro administration’s environmental policy and the threat to Brazilian democracy that it came to present. In general, the Brazilian state’s passive subordination to the USA was based on an asymmetrical relation and did not involve reciprocity on the part of the USA. Brazil accumulated trade deficits and recorded a drop in foreign investment.

In order to understand how industry and agribusiness organisations – CNI, FIESP, ANFAVEA, ABIMAQ, ABIT, CNA, ABAG and APROSOJA – had acted, we examined their position papers and their leaders’ declarations or interviews related to the following agendas: i) Brazilian membership in the OECD; ii) the conclusion of the Mercosur-EU Agreement; iii) the maintenance of the Mercosur CET; and iv) environmental policy. Their positions were classified as: i) in favour of the agendas; ii) against the agendas; and iii) neutral, in which no statements were found or when the statements found did not indicate defence or resistance to these agendas. See below:

Table 2 Positions of Brazilian employer organisations in relation to foreign policy and international integration

Organisations	Mercosur-EU agreement	OECD	CET reduction	Environmental defence policies
CNI	In favour	In favour	Against	In favour
FIESP	In favour	In favour	Against	In favour
ANFAVEA	In favour	Neutral	Against	Neutral
ABIT	In favour	In favour	Against	Neutral*
ABIMAQ	Resistant	Neutral	Against	Neutral
CAN	In favour	In favour	Against**	In favour
ABAG	In favour	In favour	Neutral	In favour
APROSOJA	In favour	In favour	Against	Against

Source: own elaboration, based on the data collected.

Caption: * linked to the CNI, which is not neutral on this issue / ** resistance centred on producers

It is worth noting that the Brazilian internal bourgeoisie moved closer to the so-called Neoliberal-Orthodox political field (Boito 2021) during the crisis of the Dilma government on account of demands such as the Labour Reform, the Outsourcing Law, and the Social Security Reform (Boito 2021). In addition, they began to advocate for a new foreign policy (Bastos 2017; Berringer 2023).

Brazil’s candidacy for membership in the OECD has been favourably received by most of the entities of the Brazilian internal bourgeoisie. According to the statements found on this subject (CNI 2017; FIESP 2019a; Abit 2020; CNA 2022; Abag 2020), it is possible to see two types of positions. The first comes from industry entities (CNI, FIESP and ABIT), with the aim of guaranteeing the country a ‘seal of quality’ (CNI 2017) that facilitates the entry of productive capital – especially from Europe, where most of the foreign direct investments (FDI) in Brazil comes from (Schutte 2020). This could lead to the modernisation of industrial plants and an increase in the competitiveness of Brazilian manufactured products. There is a strong interest in bringing the Brazilian economy into line with the standards set by the OECD in terms of taxation, the movement of capital, and ESG (Environmental and Social Governance) measures. They also envisage participating in the formulation of new regulations to be adopted by the organisation (FIESP 2019).

According to the excerpt below, the CNI defends Brazil’s membership of the ‘group of rich countries,’ believing that the proposed legal framework could increase foreign investment in the country and that the guidelines for entry would help speed up the expected neoliberal reforms.

Brazil’s accession to the OECD is a priority for Brazilian industry. Alignment with OECD standards and future entry into the Organisation will improve the business environment, promoting greater legal certainty, predictability, competitiveness and, consequently, economic growth for Brazil. To join the Organisation, Brazil needs to adhere to its legal instruments. Currently, we are part of 41% of the total, some of which are mandatory, such as the Codes of Liberalisation. The last thing standing in the way of Brazil’s adherence to the Codes is the approval of Bill 5387/19, the so-called Foreign Exchange Bill. (CNI 2021b: 14)

FIESP defended the importance of reducing costs that the neoliberal reforms contained in the OECD recommendations would achieve, but it concluded that these would not be enough:

It goes without saying that just joining the OECD won’t be enough to solve Brazil’s economic, social and governance problems. But there is also no doubt that many of the policies used in the past have not generated the expected results. Converging towards the practices adopted by the world’s most developed countries seems to be the best way forward. This type of regulatory alignment brings predictability, legal certainty and facilitates business. At the end of the day, it means a direct reduction in costs for those who invest and produce in Brazil and an increase in the value of all national assets. International benchmarks must be implemented in Brazil in all possible sectors, while safeguarding public policy spaces for extraordinary situations, something that the OECD already grants to all its members. As long as Brazil continues to invest in heterodox alternatives to its problems, society as a whole will have to bear the costs of adaptation inherent in interacting with the rest of the world. (FIESP 2019b: 8)

ABIMAQ praised the OECD on tax reform issues (ABIMAQ 2021c). However, we found no mention of Brazilian participation inside ANFAVEA’s documents.

The second type of position is found in agribusiness, notably in CNA and ABAG. These organisations are in favour of adjusting environmental standards to avoid non-tariff barriers guarantee agribusiness products access to foreign markets. This interest is aimed particularly at meeting the demands of the European Union. The CNA brings the following demands:

Defend and promote the image of Brazilian agribusiness as safe, reliable and sustainable in bilateral, plurilateral, and multilateral forums; create a unified campaign between the various government bodies and the private sector to strengthen the country’s image; discuss regulations on sustainability and international trade multilaterally to avoid the imposition of non-tariff barriers; act proactively in bilateral and multilateral forums to overcome sanitary, phytosanitary, technical, and environmental barriers that prevent access to Brazilian agricultural products; proactively defend Brazilian agriculture against unjustified measures that burden rural producers on the international stage; use Brazil’s accession to the OECD as a catalyst for structural reforms and cost reductions; use the WTO as a forum for multilateral discussions and seek to revitalise the DSB [Dispute Settlement Body] and defend the non-inclusion of food and agricultural inputs in possible international sanctions. (CNA 2022: 28)

Despite advocating for Brazil’s entry into the OECD, APROSOJA (Forlini 2020), whose main export destination is the Asian market, does not do so in the same way as the other two agribusiness organisations.

With regard to the Mercosur-EU agreement, the position of the organisations representing the Brazilian internal bourgeoisie is mostly favourable. With the exception of ABIMAQ, it is possible to divide the favourable positions into two groups. The first group, which comprises industrial organisations (CNI 2021a, 2021d; Fiesp 2019b; ABIT 2020; Reis 2019), indicates an interest in concluding the agreement in order to guarantee the participation of Brazilian industry in European value chains. It hopes to attract European productive capital to Brazil in order to modernise industrial parks, with Brazil offering an attractive environment due to lower labour costs and labour flexibility, constituting what Botão (2023) classifies as a special asymmetrical relationship between Brazilian industry and Europeans.

For ABIMAQ (2022), the most protectionist industrial organisation, the Mercosur-EU Agreement is a threat because it facilitates the entry of European products into the Mercosur market, which is the priority destination for the organisation’s products. Thus, the organisation shows preferences for greater defence of the regional market and for increasing the participation of the Brazilian state in the economy.

The second group comprising the agribusiness and its main organisations are the National Agriculture Confederation (CNA) and the Brazilian Agribusiness Association (ABAG) (CNA 2022; ABAG 2020). They defend the conclusion of the agreement seeking to guarantee access for their products to the European market (Botão 2023):

Trade agreements and diplomatic relations with partner countries are also fundamental. Let’s open up our market to the world, because we will grow through international trade. It is essential to conclude the Mercosur-European Union agreement and then guarantee access to the Organisation for Economic Cooperation and Development (OECD). Without participating in these large condominiums of developed nations, we will jeopardise the country’s development. (ABAG 2020a: 9)

It is important to clarify that the Mercosur-EU agreement doesn’t just involve trade tariffs. It is actually an agreement based on investments, intellectual property, trade rules and government purchases. In this sense, the agricultural products from Mercosur were restricted by quotas. For example, beef was restricted to 99 900 tonnes and chicken to 90 000 tonnes. Agricultural trade has always been an obstacle to progress for the agreement, given that the European Common Agricultural Policy is a food security issue.

The European Union has managed to reduce the import tariff on automobiles (it will reach zero in 15 years) and is clearly interested in the machinery and equipment and chemicals sectors. It is also important to consider the trade in services, in which the Brazilian deficit is around 70% (in 2016 imports totalled US$23b and exports US$6b). The EU is the main investor in productive assets in Brazil. In the 2020s, it accounted for 65% of FDI in the country. With the relaxation of the rules provided for in the agreement, Brazil is likely to become a ‘maquiladora’ territory, like Mexico (Schutte 2020a). With regard to government procurement, there is a clear EU interest in public tenders for infrastructure and health. These sectors have always received protection from the Brazilian state, but after Lava-Jato Operation and the destruction of Brazilian construction companies, they are now open to foreign capital. This represents a significant change in the internal bourgeoisie’s position in relation to the free trade agreements.

The proposal to reduce the CET was the one that met the most resistance within the internal bourgeoisie (FIESP 2019b; ABIT 2022; CNN 2021; ABIMAQ 2021b; CNA 2018, 2019, 2020; Brasilagro 2020). With the exception of ABAG’s silence, all the other organisations opposed the Bolsonaro government’s proposal to reform the tariff by reducing its rates, seeing it as a measure of unilateral trade opening. Such resistance is typical when there is an internal bourgeoisie, which, in order to protect itself and compete with foreign capital, adopts protectionist and negotiating positions, to the detriment of passive positions of subordination. The positions put forward by the organisations representing the Brazilian internal bourgeoisie, as well as those put forward by Argentinian organisations (Cembrar 2021), also influenced the Bolsonaro government’s decision to scale back its plans for reform by modulating the tax rates reduction in just 20% instead of 50% (Botão 2023).

The National Confederation of Industry (CNI 2021a) stated that the Customs Union guarantees the bargaining power of member countries vis-à-vis other nations and economic blocs, and that the reduction could aggravate the process of deindustrialisation and produce losses for Brazilian exports to Mercosur. FIESP (2019) resisted reforming the tariff, believing that reducing it would be detrimental to Brazilian industry. The National Confederation of Agriculture (CNA 2018, 2019, 2020) has also come out in favour of keeping the tariff at higher rates in order to stop the entry of imported products and thus control both supply and prices in the market (Botão 2023).

Finally, the point that stood out the most at the juncture was the external pressure from the USA and Europe on environmental policy. This became the issue that paralysed the ratification of the Mercosur-EU agreement, that caused friction and threats of boycotts of Brazilian exports to the USA, and that led to a loss of the country’s credibility on the international stage due to the threat to democracy that the Bolsonaro government came to represent.

With regard to environmental protection, we found favourable, neutral, and opposing positions. It is worth noting that there was a convergence between the defence of environmental protection policies and the interest in integrating into the value chains of the European market, which is more sensitive than others to this issue. This serves both to attract investment and to avoid protectionist moves by other states or regions. The importance of this agenda led Brazilian agribusiness representatives to record videos criticising the Bolsonaro government’s environmental policy due to the implementation of new European legislation that could negatively affect 80% of commodity exports to the European Union (Botão, Alencar and Venâncio 2022).

ANFAVEA, ABIMAQ, and ABIT remained neutral on this issue, which found an outlet in the CNI. The case that stands out from all the other entities examined here is that of APROSOJA, which adopted a reactive behaviour in relation to the criticism Brazil has suffered in terms of environmental protection (APROSOJA 2022; Oeste 2021); and, although it did not adhere to the government’s anti-China discourse (Guimarães et al. 2023), it proved to be the most sympathetic to Bolsonarism among the entities analysed (APROSOJA 2022). We understand that this behaviour was due to Bolsonaro’s environmental destruction policy, which facilitated deforestation and promoted the opening up of more arable land, thus increasing the productive capacity of Brazilian soybean farming.

Final considerations

The Brazilian internal bourgeoisie joined the neoliberal-orthodox front, especially the associated bourgeoisie and foreign capital. They participated in the 2016 coup d’état that ousted Dilma Rousseff from the presidency and supported the election of Jair Bolsonaro in 2018. This alliance was formed, firstly, due to the neoliberal reforms (labour, social security, etc.) that could reduce the so-called ‘Brazil Cost’ – the manner in which Brazilian entrepreneurs refer to labour, bureaucratic, and logistical costs that make production more expensive. It was also part of a strategy on the part of São Paulo Industry Federation (FIESP) to create export-led industrialisation in order to compete with the export economies of Asian countries by reducing labour costs and workers incomes (Carvalho 2018). On the agribusiness side, the strategy has turned to participation in free trade agreements with the aim of introducing products that have greater comparative advantages over other countries into new markets, especially Europe. This explains the support of a large part of the internal bourgeoisie for the Mercosur-EU agreement and for joining the OECD as part of the neoliberal agenda presented in Michel Temer’s ‘Bridge to the Future’ programme and in Paulo Guedes’s policy in the Bolsonaro government.

The Brazilian state’s candidacy for the OECD was the agenda that found the most consensus within the internal bourgeoisie. This position is closely linked to the neoliberal character and passive subordination of the Bolsonaro government, which wanted to facilitate the entry of productive capital, especially European capital. It should also be remembered that membership presupposes a series of building acts that the country must comply with, such as the Code of Liberalisation for the Movement of Capital, which allows for an increase in financial investment flows (Azzi 2020: 67). It primarily serves the interests of financial capital and the associated bourgeoisie.

In the Mercosur-EU agreement, we see strong support from the internal bourgeoisie and resistance from sectors of the Brazilian bourgeoisie, especially the machinery and equipment sector, which wants to guarantee its survival in the face of foreign capital.

The reaction of the internal bourgeoisie to the Bolsonaro government’s proposed reform of the Common External Tariff was to reject the unilateral opening of trade, which indicates the need and interest of the Brazilian internal bourgeoisie in maintaining a certain level of protection for the internal and regional markets.

The environmental agenda and the question of democracy turned out to be the most neuralgic points of the Bolsonaro government’s foreign policy, and the reactions and pressures from the US and the European Union had an effect in large part of the Brazilian internal bourgeoisie, which, with the exception of the soya sector, began to desire a change in the country’s stance in order to guarantee increased investment and access to foreign markets. There was also the fact that the umbilical relations with the USA, especially in the first two years of government, did not bring the economic and political results expected by the internal bourgeoisie, or even the associated bourgeoisie.

FIESP and CNI thus began to advocate for the adoption of industrial policies (CNI 2022a, 2022b; FIESP 2022). The defence of increasing Brazilian competitiveness against other countries was inspired by the policies of East Asia. FIESP (2022) also criticises the lack of public investment, is interested in reactivating the BNDES, and defends increasing the Brazilian economy’s resistance to external shocks, such as those caused by the coronavirus pandemic and the conflict in Ukraine.

In short, in addition to foreign policy and environmental policy, we have seen critical positioning on interest rates, BNDES funding, and other elements of the neo-developmentalist platform returning to the political scene in 2022. Thus, it is understood that, in addition to the existence of conflicts within the internal bourgeoisie, there has been a change in the interests of the Brazilian internal bourgeoisie that may explain, alongside other elements, why President Jair Bolsonaro was not re-elected.

Notes

• 1
  The organisations are, respectively, the National Confederation of Industry, the Federation of Industries of São Paulo, the National Association of Motor Vehicle Manufacturers, the Brazilian Machinery and Equipment Industry Association, the Brazilian Textile and Apparel Industry Association, the National Confederation of Agriculture and Livestock, the Brazilian Agribusiness Association, and the Brazilian Soybean Producers Association.
• 2
  Formed on the initiative of Sebastián Piñera, president of Chile (2018-2022), and Ivan Duque, president of Colombia (2018-2022), with the participation of Brazil, Guyana, Ecuador, Paraguay, Argentina, and Peru (the latter two states left the bloc during the Fernández and Pedro Castillo governments, both in 2021).

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Publication Dates

• Publication in this collection
  09 Sept 2024
• Date of issue
  May/Ago 2024

History

• Received
  20 June 2023
• Accepted
  15 Apr 2024