Doing business with Brazil is even more important under Bolsonaro

The election of Jair Bolsonaro as the new president of Brazil has sparked a sudden interest in the largest Southern American country. It seems as if those previously unconcerned by the devastating economic policies and the inability to fight crime in the country, have suddenly turned into policy experts regarding Brazil.

Now, without a doubt there is reason to be interested in the Brazil’s election and what consequences it will have: Bolsonaro is a polarising figure, and the electorate was given the uncomfortable choice between corrupt socialism and law and order paired with a questionable human rights record.

You could of course evaluate Bolsonaro only by his most controversial quotes, namely those proving his homophobia and his flirtatious tendencies towards a dictatorship. But letting yourself be guided only by a set of quotes, rather than by a set of policies, would be misunderstanding how politics works.

Here’s a quote: “Liberty is a fundamental principle. Liberty to walk freely in the streets throughout this country. Political and religious freedom. Liberty to inform and have opinions.”

That is also from Bolsonaro, and his supporters will cling on to it to defuse concerns over alleged authoritarian tendencies. The reality, after all, will be reflected in the policies.

It was reported earlier this month that the newly elected Brazilian president has voiced his support for a deepened cooperation with Luxembourg.

That of course, is of interest for the economy of the Grand Duchy: Brazil is a country with a population of over 200 million people, and a GDP of $3.3 trillion (€2.9 trillion). Investments can be beneficial for both sides, and the mere fact that Luxembourg holds such a large Portuguese-speaking population, and with even prime minister Xavier Bettel being able to express himself in some way in the language, can build a constructive relationship.

In this case, we’re likely to have the same political trade policy conversation we get with all heads of state or government that are deemed controversial: should Luxembourg engage in friendly business relationships with countries that have questionable human rights record? The answer is simple: yes, of course.

Even if we were to assume that Bolsonaro is set on governing with an iron fist, then what sense would it make to punish Brazilian companies in need of investments, and thereby workers and consumers for the actions of their government? All too often the narrative runs in politics that sanctions, or reduced business interactions, with a country makes them less popular domestically.

However, we see that the opposite is usually the case. When Turkey’s prime minister, now president, Erdogan was criticised almost unanimously for his power grab through a constitutional referendum, it seemed to actually embolden his stance.

“Doing business with a country” means in essence doing business with the people living in the country. Just because closer ties with Brazil would mean that Bettel or deputy prime minister Etienne Schneider would shake hands with Bolsonaro, doesn’t mean that those particular personalities will be involved in any trade.

In fact, the politicians signing agreements are rarely the ones personally invested in them. Yes, there would inevitably be a number of columns of the irony of a homophobe shaking hands with either Bettel or Schneider, but what matters is how prosperous Brazil becomes as a result of free trade. If Bolsonora, in a move to imitate Donald Trump, chooses protectionism over free trade, he’d impoverish Brazil’s population even more, which could only result in even more radical political choices in the future.

In fact, those worried about Bolsonaros rhetoric should be enthusiastic about Brazil being open for business from abroad. After all, trade should be about advancing prosperity, not about cheap political point-scoring.

This article was first published by the Luxembourg Times.

Pictures are Creative Commons.

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About Bill Wirtz

My name is Bill, I'm from Luxembourg and I write about the virtues of a free society. I favour individual and economic freedom and I believe in the capabilities people can develop when they have to take their own responsibilities.

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