Brazil’s Rousseff Worried About Agricultural Subsidies

By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – Brazil’s President Dilma Rousseff spoke on Sunday about agricultural subsidies during the G-20 summit currently being held in Antalya, Turkey. The Brazilian government is worried that developed nations may increase subsidies to their farmers, hindering exports from developing countries.

“Brazil is concerned that countries with greater fiscal power, especially developed nations, may react to the decline of international agricultural prices increasing domestic subsidies and those given exports. The G20 (conference) should take on a commitment to avoid the increase of subsidies,” said Ambassador Carlos Cozendey, general sub-secretary of Economic and Financial Issues at the Foreign Relations Ministry, during a press conference last week.

During her speech President Rousseff defended the importance of safeguarding the production of family farmers within the poorer nations of the world. According to Rousseff they are responsible for the greater part of food production in these countries.

In 2013 European countries eliminated subsidies given to exports and started to give revenues directly to producers. According to the European Commission the program distributed sixty billion euros to twenty-eight countries in 2014.

The recent strong depreciation of the Brazilian real in relation to the U.S. dollar, made prices of Brazilian agricultural products more attractive abroad. But while Brazil increased the volume of products such as soybean, iron ore and poultry shipped abroad, says the government, prices of these products fell by as much as fifty percent (in the case of iron ore) in the international market during the first semester of 2015.

Brazil is today the largest supplier of sugar, orange juice and coffee in the world. According to OECD, Brazil’s agricultural sector employs nearly thirteen percent of the working population in the country. A recent FAO/OECD report forecasts that Brazil is expected to become the largest beef and poultry exporter in the world by 2024.