FEC

Thankful for Long-Term Investments from Japanese Corporations

—– After two years of political turmoil and deep economic recession, how is the current situation in Brazil?

Brazil is facing political, economic, and moral crises. In the middle of the worst recession in history of more than 2 years, politicians’ corruption scandals came as a great shock to the public and resulted in the political and moral crises. In spite of these three crises that occurred at the same time, the Brazilian democratic institutions, including the judiciary and congress, are strong and responsive to all these challenges; and we have no political turmoil. Although the political crisis is still deep with new revelations of corruption, the economy appears to be recovering, as many economic indicators demonstrate the recession is over. In addition, the moral crisis is being diminished.

—– What reforms are needed for Brazil to overcome its current crisis?

Last year, President Temer began the economic reform to improve Brazil’s competitiveness in international trade and fiscal condition. It is making progress, as the congress has approved many bills such as government spending cuts and educational reform. An important part of the political reforms includes electoral reforms and other changes to the constitution. The major issues are the pension reforms and labor law reforms. With the political crisis and the low government approval rating, these are politically and psychologically difficult jobs for the government to handle; but we expect that there will be some significant advances. The public is conscious of the national problems and the need for reforms; and this is a very interesting political moment to see whether the government will be courageous to advance the reforms that are unpopular with the public.

—– Both countries will celebrate the 110th anniversary of Japanese migration to Brazil next year. What areas should be strengthened for expanding the good bilateral ties?

The Japanese immigrants are contributing to the economic development in Brazil and making positive and strong impact on the Brazilian society. At the same time, 200 thousand Brazilians are contributing to the Japanese economy, society and life. This strengthens the bilateral ties between the two countries. The 110th anniversary of Japanese immigration to Brazil will be celebrated in both countries next year. The great achievement of the Japanese community is how well they are integrated in Brazil. Now the new challenge is to support the Brazilians in Japan to integrate in and contribute to the Japanese society, just like what the Japanese immigrants achieved in Brazil. Both countries have very good relations in all dimensions, including working together on the United Nations Security Council reform. But the relations can be further strengthened in the areas of education, and science and technology. Brazil is an important destination for Japanese investments. In addition to mature industries, Japanese companies are also entering new areas like logistics and services. With the recovery of the Brazilian economy and improvement in the political crisis, there may be more investment opportunities even for medium and small size companies. This year, we will celebrate the 50th anniversary of the first visit of the current emperor and empress. The Japanese imperial family is incredibly active in promoting the friendship between the two countries.

—– Brazil successfully hosted the Rio Olympic and Paralympic Games last year. Would you give the Japanese people a message for the 2020 Tokyo Olympic Games?

It was impressive that Brazil successfully hosted the Olympics in spite of the worst political, economic, and moral crises. It was highly symbolic, as it demonstrated how strong and capable the Brazilian institutions were to the world. Since the Tokyo Olympics will be organized in a more stable context, we believe it will be an amazing show. It is important to have a balance between the cost and the legacy. The city of Rio had a large-scale infrastructure improvement, which left the people of Rio many legacies such as improved public transportation and rehabilitation of the old town. Likewise, I hope the Tokyo Olympics will bring the infrastructure improvement that is good for the Tokyoites and will become the legacy of the national public.

—– US President Trump has expressed his departure from the TPP and renegotiating the NAFTA. As the concerns of the US government’s trade protectionism increase, do you think that Brazil and the Mercosur will be affected?

Brazil has a balanced distribution of trade and investments; and the decision of the U.S. will not impact Brazil and does not worry us. We are committed to the multilateral trade system through the WTO, and are keen to strengthen the system, which is also the position that Japan has. Director-General of the WTO, Mr. Azevedo who is Brazilian, said, “Multilateral agreements and bilateral agreements must be built together,” and we are convinced of that. Having a trade agreement with Japan is a priority for Mercosur. The negotiation will start as soon as Japan is ready after adapting to the new circumstances following the U.S. withdrawal from the TPP. Until recently, the governments of Argentina and Brazil were reluctant to negotiate free trade agreements with large economies, but now both countries after the change of power are leaders in promoting such free trade. Therefore, Mercosur’s long-term negotiation for free trade agreement with the EU is expected to move forward.