Brazil runs the risk of losing the right to vote after the turn of the year in at least seven international organizations, such as the UN (United Nations), due to lack of payments. A minimum deposit of R$710.6 million is required by December 31 to avoid penalties.
Itamaraty has been calling on the economic team in search of funds to avoid the problem. A possible penalization of Brazil is seen as delicate by diplomats at the moment, as the country prepares itself for a position of greater relevance in international discussions.
In 2022 and 2023, Brazil will occupy a non-permanent seat on the UN Security Council, more than ten years after the last term in the collegiate body — in one of the most awaited moments of the national diplomatic corps.
The country will join another 14 members, five of which are permanent (China, United States, France, United Kingdom and Russia), in the body responsible for maintaining peace and security at a global level and which has mandatory decisions for all countries -members.
Among the minimum amounts to be paid by the end of this year, the biggest pending is with the UN. It is necessary to send the entity at least R$ 423.5 million before the end of the calendar to avoid losing the vote at the General Meeting.
The amount to be paid this year represents only a fraction of Brazil’s debt to the UN system, which totals R$1.8 billion. In total, Itamaraty estimates that the country currently owes R$ 8.8 billion to the various organizations to which it belongs and expresses discomfort with the possibility of penalties.
“It would be a politically delicate situation for a founding member of the organization that is currently responsible for commanding the military component of one of its Peace Missions […] and, precisely in 2022, it will assume a non-permanent seat on the Security Council”, states a letter from the Ministry of Foreign Affairs to the economic team to which the sheet had access.
Today, Brazil is at the head of the troops of Mousco (Mission of the United Nations Organization for the Stabilization of the Democratic Republic of Congo).
“The scenario is similar in other international organizations, whose activities affect different ministries, so that the extension of default would bring losses to the entire Brazilian state”, states the text.
Also on the list of bodies that may penalize Brazil after the turn of the year are the FAO (Food and Agriculture Organization), UNESCO (United Nations Educational, Scientific and Cultural Organization), the WTO (World Organization Commerce), the ILO (International Labor Organization), Opaq (Organization for the Prohibition of Chemical Weapons) and the Aiea (International Atomic Energy Agency).
In some cases, Brazil already suffers consequences of non-payment. The country stopped making a contribution to the NDB (New Development Bank), the Brics bank (Brazil, Russia, India, China and South Africa), and saw the weight of its vote in the institution reduced.
There were also problems at UNESCO. Brazil started 2021 without a vote on the entity’s executive board, recovered in February when it paid off a 2019 debt and is now back to observing the risk.
In addition, Brazil is also prevented from maintaining arbitrators in the CPA (Permanent Court of Arbitration) since May 2020 and from accessing the institution’s assistance fund.
According to Itamaraty, the default compromises Brazil’s role in diplomacy.
“Even when there is no provision for sanctions, default by member countries creates financial difficulties and can compromise the normal functioning of international organizations,” stated Itamaraty, in a note to the report.
“Thus, Brazil’s capacity to act is also weakened in organizations where there is no prediction of loss of vote, such as the Organization of American States (OAS), the Southern Common Market (Mercosur) and the Amazon Cooperation Treaty Organization (OTCA)”, says the answer from the folder.
Itamaraty also informed that it works with the Ministry of Economy and other federal government agencies to avoid compromising its international operations and that it regularly signals to the rest of the government the potential political losses arising from the default scenario.
When contacted, the Ministry of Economy stated that the issue is being dealt with as a matter of priority, but that it is not possible to specify the amount or deadline for allocating additional resources for payments.
“For this year, this amount depends on definitions conditioned to the use of budget and financial resources not used at the end of the year. However, as soon as there is a positive budget signal, the Ministry of Economy will execute these payments, with special attention to those cases of greater urgency and with the risk of applying sanctions to the country,” said the folder.
Professor Leonardo Paz, from the International Prospecting and Intelligence Nucleus at FGV (Getulio Vargas Foundation), says that any sanctions would harm Brazil directly and indirectly.
“It has a practical effect, of not having a vote, and this more intangible dimension of losing the status of a major international player. It starts to be irrelevant for countries to take Brazil into the discussions”, says Paz.
According to the expert, it is normal for countries to owe international institutions and even the United States has debts with the UN, but Brazil’s outstanding amounts are escalating during Jair Bolsonaro’s government.
Survey of sheet in February it showed that there was a 483% growth in Brazil’s debt to international organizations in 2019 and 169% in 2020. Before Bolsonaro, between 2015 and 2018, the average annual advance was 24%.
Given the scarcity of resources, Itamaraty has been reviewing its participation in organizations. It recently decided to withdraw from the Latin American and Caribbean Economic System (SELA).
Paz says the strategy is correct also considering that there was a strong expansion of diplomatic spending during the PT era.
“It makes perfect sense to consolidate, to reduce representations. And the same works for institutions in which you put money and don’t take anything away from them. But it needs to be something intelligent”, he says.
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