Free trade area United States of America/ European Union Impacts on Brazil

Abstract

The paper studies the impacts of the elimination of tariffs between the United States and the European Union in the context of negotiations of a free trade agreement. The principal theme of the paper is the impact on Brazil, particularly with respect to agricultural based products. The results show that the effects are small if Brazil does not participate. Nevertheless, if the country fully engages in the negotiations significant efficiency gains will take place with the expansion of important sectors, such as sugar and meats. The results points out to the fact that the negotiations are not likely to be easy since production and exports of sensitive products will be reduced in the three economies.