International relations

Mexico's foreign policy is traditionally non-interventionist. Recently Mexico has developed a more dynamic foreign policy and become a more active participant in multilateral affairs, climate change, human rights and regional issues.

Mexico's Relations with Neighbours

Mexico has good relations with the US and Canada, its partners in the North American Free Trade Agreement. Millions of Mexicans live in the US, often illegally, and a primary objective of Mexican foreign policy is to secure some kind of amnesty or agreement to legalise these migrants.

Mexico is keen to develop its relations with its southern neighbours in Central America. The "Plan Puebla Panama" is designed to develop the southern states of Mexico and the Central American countries economically by improving their infrastructure.

Mexico's Relations with the International Community

Mexico plays a pivotal role in several regional organisations, including the Organisation of American States, the North American Free Trade Agreement, the a grouping of Caribbean and several Latin American states) and the Asia-Pacific Economic Co-operation (a grouping of Pacific rim countries).

Mexico is a member of the United Nations, the World Trade Organisation and the Organisation for Economic Cooperation and Development. It belongs to the G20 finance group of industrial countries and the G20 trade group of developing countries It served on the UN Security Council in 2002-03. It has participated in the G8+5 outreach group of emerging economies (along with India, China, Brazil and South Africa) at the last two G8 summits.

Brazil

BASIC INFORMATION

Full Country Name: The Federative Republic of Brazil

Country Profile: Brazil

Area: 8,547,403 sq km2

Population: 182.1 million (2006 estimate)

Capital City: Brasilia

Language: Portuguese

Religion: Roman Catholic (73.6%), Pentecostal (15.4%), animist (1.4%) Currency: Real

Government: Brazil is a Federal Republic consisting of 26 States and the Federal District. States have considerable autonomy, being responsible for such issues as security and education. The President is both Head of State and leader of the Government. Elections for President and Congress take place every four years.

Legislature: The 1988 Constitution provides for an elective bicameral Congress consisting of a Federal Senate (81 seats) and a Chamber of Deputies (513 seats). Head of State: President

Membership of international groupings/organisations: United Nations, Organisation of American States, Mercosul, World Trade Organisation, G77, ALADI (Latin American Integration Association), Rio Group, ECLAC (UN Economic Commission for Latin America & the Caribbean), South American Community of Nations.

GEOGRAPHY

Brazil is the fifth largest country in the world. It is framed by two of the world's largest river systems: the Amazon in the North, and the Paraná river in the South. The Amazon basin covers some 60% of Brazil's surface, and holds 20% of the world's fresh water supply. It has the world's largest rain forest but also includes savannah and wetlands. Like the Amazon, the Paraná flows through several neighbouring countries. It drains the world's largest swampland, the Pantanal in West-Central Brazil. The Brazilian Highlands form the rest of the country, except for a coastal strip some 9,000 kilometres long. Brazil contains a number of climatic zones from the Amazon region where the temperature averages 27° C, to the dry Northeast where temperatures can exceed 40° C, to the south near Uruguay where average temperatures are 17-19° C.

HISTORY

There are various theories explaining the origins of Brazil's indigenous population. One of the most accepted westernised theories is that they migrated from Asia via the Bering Strait 15 to 25 thousand years before the arrival of the Europeans. Recently, some Brazilian archaeologists have proposed that there was human settlement in Brazil 20,000 years earlier than was initially thought. Subsequent settlement of what is now Brazilian territory has been understood in terms of linguistic and cultural assemblages, with a proposed Amazonian group in the north of Brazil (Amazon Basin) and a second group in the south and coastal areas commonly identified as the Tupi group.

ECONOMIC AND TRADE OVERVIEW

Brazil has the eleventh-largest economy in the world , with a diversified middle income economy with wide variations in development levels. Most large Industry is agglomerated in the South and Southeast. The Northeast is the poorest region of Brazil, but it is beginning to attract new investment. Brazil has a history of economic boom and bust, where high inflation and foreign debt have hampered its development. Economic reforms in the 1990s, however, brought some stability to the country's finances. These reforms included the launch of a new currency (the Real) to tackle inflation, privatisation and improved fiscal discipline.

In the run up to the 2002 elections Brazil suffered a serious confidence shock as investors waited to see whether President Lula delivered on his commitment to a responsible economic policy. This led to sharp spikes in both Brazil's risk rating and the exchange rate (with the Real peaking at R$4/US$). Since then, however, market sentiment has improved as President Lula and his team have carried through sound macroeconomic policies built on the three pillars of inflation targeting, a floating exchange rate and fiscal austerity. As a result, the 2006 elections brought about very little market reaction. Brazil's country risk currently stands at around 150 basis points and Fitch places Brazil one notch below investment grade. Annual inflation in 2006 was 3.14%, well below the 4.5% target and the basic interest rate reduced from 17.25% in January 2006 to 12.5% in May 2007.

Brazil's economy grew 3.7% in 2006, compared to 2.9% in 2005. (Projections for 2007 are in the region of 4 %). Once again this built on the back of strong balance of trade figures, with a record surplus of US$46.1 billion, beating the previous record in 2005 of US$44.7 billion. Brazil's main export markets are the EU, US, Argentina and, increasingly, China. Commodities in particular have been strong performers.

The Government's long term economic strategy focuses on achieving long term and sustainable growth through the Acceleration Growth Plan (РАС) launched in early 2007. The Plan centres on two major themes: investment in infrastructure and tax incentives to encourage private sector investment. Much needed structural reform (including of the social security and tax systems) have taken a back seat.

Basic Economic Facts

Major Industries: Agriculture (soya meat, sugar, fruit, vegetables), iron ore and minerals, iron and steel, oil and derivatives, food processing, wood products, footwear and textiles, automotive, aerospace, petrochemicals, financial services, electronics

Major trading partners: United States, China, Argentina, Germany, Japan, Italy, France, and United Kingdom. Mercosul

Brazil is a founder member of Mercosul, (the Southern Cone Common Market - known as Mercosur to its Spanish speaking members) along with Argentina, Paraguay and Uruguay. Venezuela became a full member in July 2006. Bolivia, Chile, Peru, Ecuador and Colombia are currently Associate Members although discussions are currently underway regarding Bolivia's request for full membership. Mercosul is the world's fourth-biggest integrated market and represents 75% of South America's GDP. Mercosul has been successful in promoting increased trade among its members as well as with the outside world. In recent years, however, regional economic instability has slowed the integration process. Mercosul is in the process of negotiating an Association Agreement with the European Union, which once concluded will lower trade barriers and promote co-operation on a range of policy issues.

BRAZIL'S INTERNATIONAL RELATIONS

Brazil is a key player on the world stage. It is at the forefront of efforts to deepen Latin American integration, through its membership of Mercosul, the Rio Group, ALADI and other regional groupings. It was a driving force behind the founding of the South American Community of Nations in December 2004. Brazil founded, and plays a co-ordinating role in the G20 group of nations in WTO negotiations. It is an active and influential member of the United Nations Brazil leads the UN peacekeeping force in Haiti (MINUSTAH) and participates in the multinational presence in Timor Leste. It is the largest member of the community of Portuguese-speaking nations (CPLP).

Brazil supports reform of the United Nations, both the Security Council and more widely. Brazil has put itself forward as a candidate for a permanent seat in an enlarged Security Council and has the stated support of a significant number of countries, including the UK. Alongside India, Japan and Germany, Brazil has formed a group to co-ordinate and lobby in support of their respective candidatures.

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