Biden in Brazil to see World Cup, heal strained ties

[June 17, 2014]  By Anthony Boadle and Brian Winter
 
 BRASILIA/SAO PAULO (Reuters) - U.S. Vice President Joe Biden heads to Brazil on Monday, hoping to do more than just watch Team USA play Ghana in the World Cup.

Biden will also try to turn the page on chilly U.S. relations with President Dilma Rousseff, who was outraged by revelations last year that the National Security Agency spied on her and other Brazilian officials.

Rousseff, who canceled a state visit to Washington in response, recently indicated she was ready to move on from the spat. That could unlock faster progress on trade, offshore oil development and other long-elusive cooperation between the two biggest economies in the Americas.

Brazil's left-leaning leader told reporters she was eager to reschedule her Washington trip - but only if she gets a "strong signal that (spying) won't be repeated."

That comment sent officials in Washington scrambling to figure out precisely what she's looking for.

In response to the uproar over NSA spying in Brazil, Germany and elsewhere, President Barack Obama said in January that the United States would no longer spy on heads of state of allied countries.

Biden can't go much beyond that when he meets Rousseff in Brasilia on Tuesday, U.S. officials told Reuters. But they hope that face-to-face assurances from a leader for whom Rousseff has respect - and has even described as "seductive" - will be enough to move on.

Some in Washington had advocated postponing Biden's trip due to turmoil in Iraq. But the vice president decided it was a unique chance to heal relations with a country with a $2.2 trillion economy and growing diplomatic clout, one official said.

"The sky is the limit and there's a lot more we can do together," Biden told Brazilian newspaper Folha de S.Paulo in an interview published Monday, adding he hoped to "rebuild trust" following the NSA leaks.

Indeed, warmer relations could spell gains for both countries.

Brazil's economy is Latin America's biggest, but also one of its most closed to trade, and U.S. companies have tried for years to persuade Brasilia to lower tariffs.

Brazil wants U.S. companies to drill for its offshore oil deposits and help with technology to access vast shale gas reserves.

The diplomatic conflict cost Boeing Co. a $4 billion fighter jet contract with Brazil's air force. Boeing had been the front runner but the contract went to Sweden in December after Brazilian officials said they could not buy military hardware from a country they did not trust.

Initiatives dear to Brazilian executives have also been on hold, including a treaty to avoid double taxation, the fast-tracking of U.S. visas for executives, and regular meetings between corporate chief executives of both countries.

"There has been a real effort by Washington to say: 'Look, we know the Snowden issue has been a complicated one, but our interests together are too deep to let this fundamentally change anything," said Eric Farnsworth, vice president of the Americas Society, which promotes regional ties.

(Editing by Kieran Murray and Bernadette Baum)

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