Brazil: the Next OECD Member?

According to recent reports, there are serious ongoing talks of Brazil requesting full membership to the OECD in the next couple of weeks. If this process does indeed go through, the country would be the largest emerging economy in the Organization, and the third in Latin America, following Mexico and Chile. This would also make Brazil the first of the OECD’s “Key Partners” – the others being China, India, South Africa, and Indonesia – to take the leap from the “Enhanced Engagement” programme to a full membership status.

It is tempting to frame this (potential) change as directly linked to President Michel Temer’s reformist agenda and foreign policy detachment from former leftist Presidents Luis Inácio ‘Lula’ da Silva (2003-2010) and Dilma Rousseff (2011-2016) South-South oriented discourses. While there is certainly a relationship between these governments and Brazil’s links to the OECD, there is a bit more complexity and nuance to be taken into consideration.

Michel Temer, Dilma Rousseff, Brazil, Tuesday, April 24, 2012. (AP Photo/Eraldo Peres)

In 1991, an exploratory mission expressed the country’s interest in fostering pathways for collaboration with the Organization. In the mid-90s, the country became an official observing member, and while the possibility of an eventual membership was contemplated by some in the Brazilian government, the idea did not gain traction. Still, since 1999, Brazil became regularly invited to every OECD Ministerial-level meeting.

By 2007, during President Lula’s tenure, the dynamic between Brazil and the OECD was much different than the idea of a “developing” country craving legitimacy in the international system by joining the “Clube dos Ricos” – the “Rich [countries] Club” – as many in Brazil still refer the Organization. This time, it was the OECD who was seeking to maintain its own global relevance by inviting large emerging countries – called “Key Partners – to strengthen their links with the Organization and facilitate their eventual membership. As stated in the OECD’s Annual Report 2008, the decision reflected “a recognition that the economic and political map of the planet has changed, and that progress on major challenges will only be achieved by intensifying co-operation among the world’s major economic players.”1

In 2007, there was again some speculation whether Brazil would move forward to a full membership, but the government did not appear to be interested in this direction at that moment. One of the public concerns expressed by then Foreign Relations Minister Celso Amorim was if Brazil would have to pull out of the G77 – a move Mexico had done when it became an OECD member in 1994. While there is some truth to the idea that joining the OECD could hurt Brazil’s image as a Southern “leader”, it appears that concrete policy considerations were more on the minds of decision-makers: a full membership would require legislative changes over Brazil’s sharing of banking information and transfer pricing regimes.

3 June 2015: Signing of co-operation agreement between the OECD and Brazil

As the years progressed, there was a growing density in the relationship between the Brazilian bureaucracy and its counterparts in a series of OECD commissions. This culminated in yet another milestone, when in 2015 (under President Rousseff), a new cooperation agreement was signed. The OECD-Brazil Programme of Work established a series of projects and studies aimed at structuring even more bilateral links. In the words of then Foreign Relations Minister, Mauro Vieira, “the Brazil-OECD Programme of Work will enable the implementation of different initiatives in 2016-2017, in consonance with our own development strategy geared to improved outcomes in terms of economic growth, social inclusion and sustainability.”2

Therefore, prior to Michel Temer becoming president last August, following 13 years of left-leaning presidencies, Brazil was already an Adherent to close to 30 OECD legal instruments3, and had an associate (full rights) status to nine programmes and committees, as well as a long list of participant status in various other OECD bodies and activities. Current Finance Minister Henrique Meirelles, who a couple of weeks ago explicitly declared his favourable position over Brazil’s full OECD membership, was President of the country’s Central Bank during President Lula’s entire eight-year tenure. So, while President Temer and his team can be actively pushing forward on a speedy full membership of Brazil to the OECD, the move should not be hastily characterized as a complete rupture in the country’s relationship with the organization vis-à-vis the two previous presidencies. While the push for full membership would be a new policy indeed, such action needs to be contextualized: it would be a new chapter within an ongoing process of approximation with the OECD, which had important steps undertaken during President Lula and Rousseff’s tenures.

Finally, even if symbolically ‘odd’, Brazilian foreign policy could still cling to a ‘South’ or ‘developing’ discourse. There would be no reason to assume it would leave the G77. After all, Chile, which joined the Organization in 2010, has remained a member of the ‘Southern’ organization. It would also not automatically force a change to Brazil’s South-South Cooperation approach to development assistance nor its standing as a being a recipient of assistance: not all OECD members are members of its Development Assistance Committee (DAC), and countries who are DAC member can still be recipients of Official Development Assistance (ODA). And even in the WTO, Brazil could still remain as under the “developing country” status, since this positioning is based on self-identification, and other OECD members like Mexico and Chile have remained under this status.

In the next weeks, it will become clearer if the current administration will indeed push forward on the full membership move, and what would be the domestic and international reactions. It is unclear if such membership would have any impact on Brazil’s standing with other BRICS countries, the G20, or other global governance arrangements. Such move would also pose interesting questions on whether other “Key Partner” countries would also consider following suit, and if so, how it would deeply challenge the idea of OECD countries being a proxy for ‘developed countries’. Interesting times…