The Wall Street Journal (WSJ) reported that Brazil and the U.S. unveiled a series of accords on trade and investment aimed at reducing barriers for bilateral commerce and supporting local Brazilian economic development. The bilateral trade agreements were unveiled Saturday, as US President Barack Obama embarks on his first official visit to South America.

The accords will see the expansion of passenger air service between the US and Brazil, cooperation on large upcoming local sporting events, cooperation on biofuels, environment, and labor regulations, space program development, and creation of a joint U.S.-Brazil panel to identify new trade and investment opportunities.

However, FOX Business reported that President Obama hopes to lay the groundwork for more trade with Brazil during his visit, with announcements of a framework for negotiating future trade deals and a new round of U.S.-backed financing for American companies bidding on Brazilian projects.

There have been long-standing disagreements between the two countries on trade and foreign relations. According to Fox, experts believe stronger economic ties between the U.S. and Brazil are constrained in part by their continuing disputes over agriculture subsidies and tariffs and slow U.S. movement on approving three existing free trade agreements awaiting Congressional approval.

The Wall Street Journal reported that official documents revealed the air service accord will allow increased reciprocal access of Brazilian and U.S. companies to the countries' respective domestic destinations, as well as expanded sales, marketing and aircraft maintenance options.

On the other hand, the space cooperation agreement sets forth "guidelines" for possible future joint operations between the Brazilian Space Agency, AEB, and NASA, allowing for joint research and operation of facilities and equipment, said WSJ.

Additionally, a sporting event cooperation accord will focus on "planning and strategic development, infrastructure, security, tourism and hospitality support, and commercial enterprise" for major international sporting events planned in Brazil in coming years. Brazil is scheduled to host the 2014 World Cup soccer championship and the 2016 Olympics.

FOX Business said Obama will likely announce new financing arrangements through the U.S. Export-Import Bank for American companies pursuing billions of dollars of infrastructure contracts in Brazil, especially projects stemming from Brazil’s hosting of the World Cup and Olympics during the next five years. This initiative does not require Brazilian support or approval, however.

Obama is scheduled to hold meetings with Brazilian President Dilma Rousseff and later attend a conference of CEOs from top Brazilian and U.S. companies, reported the WSJ.

20th March 2011