PM ends visit with effusive praise of Brazil

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Stephen Harper comes away from a vital two-day trade mission to Brazil hoping he's managed to fix Canada permanently on the radar of the world's seventh-largest economy.

He had to contend during his visit with global stock-market turmoil that distracted attention from his efforts to repair ties between Canada and Brazil that were damaged by indifference and an aircraft-subsidy spat in years past.

During his final message to Brazilians, a speech in the country's business capital of Sao Paolo, Mr. Harper sought to make up for lost time with the nation, which experts say will be among the world's most influential in the 21st century.

The speech was notably long and effusive for the Prime Minister. Mr. Harper said Canada has for too long neglected relations with Brazil, and vowed to remedy this.

"Friends, too much grass grows in the cracks on the road between our two great countries. It is time for increased ambition," he told an audience in Sao Paulo, a metropolitan area of 18 million people.

"That is why I am here today."

He told the crowd of business people, politicians and academics that Canada and Brazil should be trading a lot more goods than merely $5.9-billion per year between them.

"Although Brazil is Canada's largest trading partner in South America, our two countries still did barely $6-billion in business last year, despite having combined GDPs of close to $4-trillion."

The Prime Minister also paused to steer the minds of his Sao Paulo audience away from the plunging stock markets, saying while the health of exchanges is important, the long game is what matters.

"We put too much emphasis on this stuff," he said. "It's way too easy to focus on the trillions that seem to be lost on markets."

Canada needs to sell more to fast-growing emerging markets such as Brazil to diversify trade away from the U.S. economy.

Mr. Harper's address – designed to woo decision makers in South America's largest country – even took time out to praise Brazil's airplane industry.

Canadian aircraft maker Bombardier is a fierce competitor of Brazil's Embraer.

"When the world looks at Brazil, what does it see?" he said.

"It sees a new industrial power, forging ahead with information and communication technologies, justly proud of its aircraft industry and well on the way to becoming a space-faring nation with its own orbital launch capacity."

The Prime Minister made special effort to recognize Brazil's ascendancy globally. It's a member of a group of nations known as BRIC – Brazil, Russia, India and China – that are expected to be among the world's dominant economies over the next 100 years.

"Canadians applaud as Brazil takes its rightful place on the world stage," Mr. Harper said.

In the speech, he harkened back to 19th-century Brazil when Canada was a big financier and supplier to the South American nation of railway cars and power.

"I wish I could say that 135 years later, nothing has changed," Mr. Harper said.

"But, dear friends, during too long a time we neglected relations between our two countries."

Lingering in the background during this visit are decade-old memories of diplomatic hostilities between Canada and Brazil over state aid to aircraft makers and a ban on Brazilian beef.

Mr. Harper sought to cement new narratives between Brazil and Canada though, emphasizing the common themes in both countries' development as well as the fact that they have avoided much of the financial crisis that has hit the United States and Europe.

"In your story, we see some of our own. The same story of progress from colonial status to federalism and mature independence.

"The same outward urge, from our first cities to our respective vast frontiers, the Amazon and the Arctic.

"The same evolution of our economies, from resource extraction, to industrialization, to the remarkable new world of knowledge-based innovation," he said.

The Prime Minister tackled the history of bad blood a decade ago when the two countries fought each other in trade forums over alleged unfair state subsidies to the aircraft manufacturers.

He made much of the relative peace that exists now.

"Competition has to be between businesses, not governments," Mr. Harper said.

"In the case of aircraft, it has to be between Embraer and Bombardier, not Brazilian and Canadian taxpayers.

Mr. Harper pointed out that today, Air Canada is a big buyer of Embraer aircraft, and Canadian companies supply parts to Embraer.

"What this should show us is that when we work out those things that divide us, we initiate a virtuous circle of goodwill, co-operation and economic opportunity."

The Prime Minister said he's encouraged that two-way investment has growth significantly, reaching $23-billion in 2010.

"[It's been]driven by more than 400 Canadian companies in Brazil; companies such as Brookfield, Scotiabank, Research in Motion, Telesat, SNC Lavalin and Kinross," he said.

Meanwhile, Brazil is the eighth-highest source of foreign direct investment in Canada, thanks to firms like Vale, Votorantim, Gerdau and Ambev.

"Still, when you do the math," Mr. Harper said, "total merchandise trade is still little more than one-tenth of 1 per cent of our joint gross domestic product.

"For two friendly countries, I think we could be friendlier than that."