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SUMMARY
The United States has traditionally enjoyed cooperative relations with Brazil, which is the seventh-largest economy in the world and is recognized by the Obama Administration's National Security Strategy as an emerging center of influence. Administration officials have often highlighted Brazil's status as a multicultural democracy, referring to the country as a natural partner that shares values and goals with the United States. Bilateral ties have been strained from time to time, however, as the countries' occasionally divergent national interests and independent foreign policies have led to disagreements. U.S.-Brazilian relations have been particularly strained over the past year as a result of alleged National Security Agency (NSA) activities inside Brazil. Nevertheless, the countries continue to engage on issues such as trade, energy, security, racial equality, and the environment.
Political and Economic Situation
Dilma Rousseff of the center-left Workers' Party was inaugurated to a four-year presidential term on January 1, 2011, inheriting a country that had benefited from 16 years of stable governance under Presidents Fernando Henrique Cardoso (1995-2002) and Luis Inácio Lula da Silva (2003- 2010). She has spent much of her time in office focusing on domestic economic challenges. Brazil experienced a rapid economic expansion from 2004 to 2010, but growth began to slow in 2011. While Rousseff's efforts to stimulate domestic consumption and protect domestic industry have helped keep unemployment near record lows, economic growth has yet to accelerate, averaging 2% annually during the first three years of her term.
Rousseff has also had to contend with several political challenges. Mass demonstrations took place across Brazil in June 2013, with protesters calling for better quality public services, among other demands. Rousseff implemented some policy reforms in response to the demonstrations, but smaller-scale protests have continued to occur and could grow in size in the lead-up to Brazil hosting the World Cup in June and July 2014. The Brazilian Congress has provided additional challenges for Rousseff, with some sectors of her multiparty coalition opposing her legislative initiatives. Although Rousseff's approval rating declined significantly during 2013, it has partially recovered and stood at 41% in February 2014. National and state elections are scheduled for October 2014, and early polling suggests Rousseff is favored to win reelection.
Congressional Action
Brazil has remained a subject...