Hemispheric Strangers

Despite many similarities between Canada and Brazil, their relationship has a long way to go

In Ottawa these days, Brazil is a very hot commodity. That is right, Brazil—land of beaches, soccer, endless rainforest and Carnival. But it is not its tourist attractions that have everyone excited. It is the other Brazil, the B in the rapidly emerging BRICS economies (Brazil, Russia, India, China and South Africa). As you read this, in fact, our federal and provincial governments, post-secondary institutions and companies are busy exploring ways to develop stronger ties with the new colossus of the Americas. The objective: to gain full advantage of Brazil’s phenomenal economic expansion and growing geopolitical prominence—whether in terms of importing talent, enhancing trade, attracting investment or aligning on the advancement of political interests on the global stage.

Of course, Canada is not the only country looking to secure advantage with the Brazilians. The Americans, the British, the Germans, the French—they are all there, building strong bilateral relationships that will boost trade, exploit talent and create jobs. How will Canada fare in this competitive quest?

It may be a much tougher mission than one might think. Just because we now have discovered Brazil does not mean that Brazil will necessarily welcome such advances with open arms. To date, in fact, we have maintained what could only be described as a fairly modest bilateral relationship. After Mexico, Brazil is our second most important trading partner in Latin America, with the value of goods and services moving back and forth each year between the two countries at about $5 billion. To put the total value of this exchange into context, however, that is only about the same value as moves between Canada and the United States every single day.

Furthermore, the trade balance has tended to favour our South American partner not only in dollar terms, but also with respect to the qualitative flow of goods. Contrary to what most Canadians might expect, by volume we tend to sell Brazilians commodities and raw materials—coal, fertilizers, newsprint and wheat—whereas we increasingly rely on Brazil for finished or higher tech goods such as steel, aerospace equipment and automobile parts. On a brighter note, Canadians have been long-term investors in Brazil, through companies such as Alcan and Brascan (now Brookfield), in areas from energy to utilities and real estate.

And on the other side of the coin, Brazil has embarked upon a slow but steady march to acquire key Canadian assets. In mining, for example, think of the recent takeover of Inco by Vale. St. Marys Cement—one of the largest concrete producers in southern Ontario—now flies the Brazilian flag at its head office. And Labatt beer—Canada’s “birthplace of the Blues,” as the ad used to say—is now owned by Brazilians.

On the global stage, we are generally friendly and cooperative, but can claim, to date, few joint diplomatic victories. Significantly, we have worked together on important international undertakings—most recently and notably on peacekeeping services in Haiti. But, overall, far too much of our diplomatic energy has been focused on less than civil and supportive pursuits. Many Canadians might recall the case of David Lamont and Christine Spencer, the two Canadians who in the late 1980s, as part of an effort to finance Latin American terrorism, had kidnapped Abílio Diniz, the president of a large supermarket chain in Brazil. The Canadian government insisted they were innocent, casting aspersions on the competence and fairness of the Brazilian justice system. Forensic evidence ultimately, and dramatically, demonstrated that this position was misinformed. Not surprisingly, Brazilians—both in Canada and at home—were not amused. Nor were they amused when in 2001 we moved to ban Brazilian beef imports to Canada—a decision made owing to the fact that the Brazilian government had failed to produce a report on time, and thus the pretext that Brazilian beef “might” be tainted with mad cow disease. In fact, unlike in Canada, not one case of this illness was or has ever been found in a Brazilian herd. The reaction in Brazil was swift and uncharacteristically vocal, involving multiple public anti-Canadian protests, some of which involved pouring perfectly good Canadian whisky into storm sewers.

And last but not least, almost all Canadians and most Brazilians will be well aware of the long-standing dispute that has placed aerospace giants Bombardier and Embraer in a battle for global supremacy in the market for regional jet aircraft. Perceived as flagship high-tech giants in each country respectively, competition between the two had reached a fever pitch by the mid to late 1990s, when Canada and Brazil accused each other of unfair competition practices linked to government subsidization programs. Claims and counterclaims were filed by both countries at the World Trade Organization. In the end, both countries were found to be at fault, although in 2003 Brazil was given leave to impose significant trade sanctions against Canada that were never put in place. With the green light for retaliation in place, however, the situation began to cool after this time. Nonetheless, to this day Bombardier aircraft do not fly commercially in Brazil. At the same time, Air Canada’s decision to add several dozen Embraer 145s and 190s to its fleet during the past five years has put noses seriously out of joint with the Canadian aerospace sector, politicians and senior members of government.

So in this context of relatively quiet interchange, marked occasionally by outright hostility, the question arises as to whether or not, as hemispheric partners, Canada and Brazil can now change course and develop a meaningful, mutually beneficial relationship.

For our federal government, the answer is an unqualified yes. For the rest of us, however, Brazil continues to lie well under the radar. For most Canadians, Brazil’s recent prominence as an emerging global powerhouse is largely unknown. If you go there as a tourist—as lamentably few Canadians do—most of your friends will ask if you managed to learn a little Spanish, with nary a clue that Brazil is the largest Portuguese-speaking country in the world. And Brazilians mirror this state of affairs. Canada tends to be perceived as the northern extension of the U.S. frontier, a country where either all or at least some citizens speak French all or at least some of the time. Most know of Montreal and Toronto, but likely would be unable to name other major Canadian cities. And this vague perception of each other continues in spite of the fact that each country maintains a daily presence in the other, in often remarkable ways. In a single day, several thousand Canadians will have flown on Air Canada Embraer commuter jets made in Brazil, sipped a caipirinha or learned a Brazilian martial art called capoeira. Every nickel in our pockets will have been made with metal produced by Brazilian mining giant Vale in Sudbury. Similarly, many Brazilians will utilize water and power resources that were initially developed over a hundred years ago by Canadian-owned Brazilian Traction, Light and Power. And soon, the citizens of São Paulo will ride on an extended subway line engineered by Bombardier. Yet, in good measure, Brazilians and Canadians remain an enigma to each other.

During the past decade, initial efforts on the part of our own government to breed greater familiarity and thus to kickstart a closer relationship between our two countries among politicians and citizens focused on propagation of official discourse stressing a common historical trajectory and interests. To some extent, such a strategy makes sense. After all, we are both products of colonization led by major European powers beginning in the 16th century. Moreover, Canada and Brazil are vast countries, with abundant resources, and population centres clustered along narrow bands—in Canada, along the U.S. border, and in Brazil, along the Atlantic coast. We are countries of immigrants, from myriad countries and ethnic backgrounds. We have significant aboriginal populations, and a history of internal colonization of which neither can be proud. Other powerful established and emerging countries yearn to access (and colonize) our precious natural resources. In terms of geopolitics, we are middle powers at best, and share good intentions from time to time. We fought together in Italy in World War Two and jointly undertook peacekeeping duties during the Suez crisis in the 1950s. And we share an extremely close, but sometimes uneasy, relationship with our largest and most powerful neighbour, the United States.

There are other commonalities. In global terms, we are essentially bred from the same or similar European “stock.” We are both western countries, predominantly Christian, with large Catholic populations (most of whom do not attend church services). Our business practices are similar, not just in terms of our capitalist orientation, but with a long history of government intervention through state or, as we call them, Crown corporations. Just as government-initiated and owned ventures such as CN, Air Canada and the CBC helped to build the Canadian economy and shaped Canadian identity, so too has the modern Brazilian economy been built through state intervention. To the extent that today Brazil has achieved world-class standing in mining, aerospace and alternative energy production, it has been thanks to pioneering state ventures—companies such as Companhia Vale do Rio Doce (Vale), Embraer and Petrobras, all of which, while formally autonomous, retain a strong element of government ownership and control. Culturally, we read each other’s books and listen to each other’s music every single day. While they will not recognize his name, Canadians are able to at least hum the many hits of bossa nova stylist Antônio Carlos Jobim, while Céline Dion and Bryan Adams play constantly on Brazilian radio. Brazilians are eminently familiar with Canadian authors such as Yann Martel, while Paulo Coelho is read widely in Canada, especially Quebec. Of all Canadian regions, in fact, Quebec is probably best aligned culturally with Brazil in all these respects. It is also home to the Centre for Studies and Research on Brazil (CERB), the only such entity of its kind in Canada.

Beyond this, however, we are very distinct entities indeed. Just consider the facts, starting with our past colonial histories. Canada is somewhat unique as the product of large-scale exploitative efforts in the New World of not just one, but two major powers—France and England. And only following a succession of conflicts—most notably on the Plains of Abraham—did Canada eventually emerge from colonial status as a country in 1867, albeit initially as a dominion of the wider British Empire. While Brazil was similarly the creation of yet another European power—in this case Portugal—its story is far different. By the early 1800s, forced out by the Napoleonic advance, the Portuguese Crown left Lisbon and took up residence in Brazil, in effect rendering the vast colony the new seat of Portugal’s global empire stretching from South America, to Africa and Asia. It was the son of the reigning Portuguese monarch, the newly minted Emperor Dom Pedro I, who himself declared Brazil’s independence from Portugal in 1822. Two thirds of a century later, in 1889, the Brazilian “Republic” was proclaimed by a group of elites enamoured of the principles not of Jefferson or Bentham but of French sociologist Auguste Comte—hence the design of the then-new Brazilian flag emblazoned with Comte’s positivist credo, “Order and Progress.” And while Canada established and consolidated an inclusive democracy on the British parliamentary model, Brazil through the 20th century endured a checkerboard succession of elite-dominated republican regimes and quasi-fascist dictatorships, culminating in authoritarian military rule that lasted from 1964 to 1985. Only during the first part of this century have we seen emerge the kind of stable democracy that Canadians would readily recognize. At the same time, this new model still struggles to close one of the world’s biggest income gaps between richest and poorest. It also has not yet managed to come to grips with endemic government corruption at all levels. It is the general absence of corruption in Canada that has propelled this country to near the top of international lists in terms of transparency.

Second, our approaches to immigration and ethnic integration have been vastly different. During the late 19th century, both Canada and Brazil opened their doors wide to immigration that, in effect, has been the single most important contributor to each country’s economic development and growth. By the late 1960s, Canada’s inherent biculturalism gave way to the development of moral and legal structures in fierce defence of a multiculturalism that not only allowed for, but also encouraged the preservation of language and other cultural elements for all individuals and groups that choose to do so. In Brazil historically, the assimilationist impulse has been far more powerful, and retention of ethnic characteristics broadly discouraged. And Brazilians are extremely proud of the fact that their 193 million citizens speak one language. So even while the city of São Paulo may be home to the largest constellation of Japanese living outside of their homeland, it remains exceedingly rare to hear Japanese spoken on the street.

And then there is global heft and foreign policy. While we may each control vast, resource-rich territories, we differ greatly in size. Brazil’s population is over six times that of Canada at just under 200 million. And increasingly, Brazil is using its weight and newfound economic prowess to press geopolitical aims. Within the Americas for example, Canada has a relatively minor role and is often perceived as a side player to U.S. interests. Brazil for its part, represents half of the South American continent, and securely dominates its smaller (although not economically insignificant) Mercosur trading partners of Argentina, Uruguay and Paraguay. In counterpoint to the U.S., Brazil then plays a significant role in hemispheric politics, a fact never forgotten in Washington. Globally, Canada has a prominent role as a member of the G8 but is deeply sensitive to its ever-downward slide as other economies emerge as stronger economic powers among the G20 countries. Brazil happens to be one of the countries at the forefront. Furthermore, Canada has taken an increasingly hawkish stance in regional interventions, effectively leaving behind a legacy of peacekeeping. Brazil, on the other hand, has remained a dyed-in-the-wool dove, which is, however, at the same time aggressively pursuing global leadership through careful alliances with the developing giants of Asia and, more recently, Africa. In short, while Canada carefully aligns with its traditional partners in the U.S. and to some extent Europe, and maintains a notional attachment to its Commonwealth partners, Brazil has its eyes securely on major league status as a global power in its own right.

And last, while in many respects “homebodies”—preferring to receive mobile populations as opposed to encouraging global outreach on the part of their own citizens—Brazil has increasingly become much more outwardly focused than Canada. Where Canada may have the strategic advantage in terms of education, research and innovations capacity today, Brazil may well lead the way in the future development of globally savvy next-generation leaders. For example, under its landmark Science Without Frontiers program, Brazil will send more than 75,000 students and researchers abroad. At least 15,000 each year already arrive in Canada just to learn English. Canada, on the other hand, has few such programs for its young generation. It maintains instead an over-preoccupation with recruiting students to Canada rather than sending a healthy number abroad.

So if indeed all of this represents our disjunctured past, is there a basis on which we can envision a productive and mutually rewarding Canada-Brazil alliance, the benefits of which ordinary citizens will recognize, buy into and broadly support? The answer is yes, in fact. As long as we are armed with respect for each other and a reasonable willingness to think about what makes practical sense, both countries can look forward to sustained and rich returns in the short term and over the long term.

More than ever, talent and ideas are shaping the face of the planet. Those countries that are able to train and attract globally connected, highly qualified personnel will achieve advances in research and development across the disciplines. It is these strategies that will lead to new ideas, better services and novel technologies that bring domestic and global value and effectiveness for econo-environmental balance and sustained stability. Countries that have adopted this approach are vastly outperforming the ones that do not. Consider the cases of Finland—a world leader in mobile communications—or Germany, with a huge export economy driven by some of the best-known and most sought-after brands in the world. More and more, building the next generation of talent that can think and network globally and establishing a creative environment that fosters the ability to maintain these networks and cultivate new ideas are not just desirable goals but, in fact, strategic imperatives, since talent will always gravitate to jurisdictions that cherish and nurture it.

And this is precisely the arena in which Canada and Brazil must act. It comes as a welcome development then, that as Canadian and Brazilian politicians and senior diplomats explore new avenues for setting bilateralism on a sound footing, the old discourse of historical commonalities, conflict and competition has now given way to the political pragmatism of aligning talent and ideas between the two countries. In 2008, following months of negotiation, Canada and Brazil finally signed an agreement to guide collaboration on research and development. Slowly but surely, Canada has now come to the realization that despite Brazil’s presumed status as a developing or emerging economy, it possesses one of the most sophisticated innovation systems in South America, including not only emerging top-tier universities but also internationally recognized state and federally funded science institutes promoting industry-relevant research in areas from agricultural biotechnology to satellite development and testing. This has, in turn, driven a high-tech economy in areas such as green energy and aerospace where Brazil has taken the lead globally.

Based on this realization, Canada and Brazil are now pursuing, and with some success, their knowledge-based agenda. The 2008 agreement has now given way to the creation of the Canada-Brazil Science, Technology and Innovation Joint Committee, with high-level representation from government, academia and the private sector. The committee’s goal is to establish a short list of specific project areas that bring together public and private sector researchers in pursuit of novel products and processes that can be commercialized jointly. These will be developed within agreed-upon areas of research and development complementarity between the two countries—including oceans management and commercial development of ocean resources, neurological disorders, infectious disease, information and communications technologies, and so-called clean technologies, including alternative energy. With funding from research agencies in both countries, matched by the private sector, the idea is to develop cutting-edge technologies in these and other sectors that establish the two countries as leaders and give both a competitive edge internationally. Just imagine if the next vaccine for dengue fever, a cure for Alzheimer’s, environmentally friendly offshore drilling practices or the next generation of smart phones emerged from this process? That is the sort of cooperation that builds strong bilateral partnerships.

This kind of success, however, will continue to elude Brazil and Canada until there is a parallel investment in a talent strategy that fuels the areas of focus laid out in the agreement. For bilaterally created innovations between Brazil and Canada to emerge and flourish, what is needed are people who speak each other’s language, understand each other’s culture and have developed personal connections and friendships. The Brazilians are taking the lead with their aforementioned Science Without Frontiers program that will see thousands of students and scientists travel abroad for study and research purposes—many of them to Canada (at least if we are smart enough to attract them). Unless Canada creates a similar opportunity for its young Canadians, it is Brazilians, not Canadians, who will have greater access to both Brazilian and Canadian markets. And the Brazilian market potential is many times greater than Canada’s.

A joint, balanced approach of exchange of people and ideas will result in a movement of talent and commercial activity the likes of which we have never seen between our two countries, increasingly supported by a host of new programs already in play. As people start to move across our borders within the context of a joint “mission,” this will have no other effect than to breed the familiarity, common purpose and commitment to excellence that to date have been lacking in the Canada-Brazil interchange, and will thus form the bedrock we can build on. At that point, and that point alone, we will truly be able to say we have established a sound and productive bilateral relationship—one that will surely pave the way toward much broader cooperation on a number of other fronts, from global security to health and environmental sustainability. Fifty to a hundred years from now, historians may look back and see that this period represented one of the best and most productive periods in Canadian-Brazilian relations in terms of generating domestic and global value. With support and political will, this could well represent a period that changes the course of history and the path of globalization.