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Talks Begin To Resolve U. S.-Brazil Dispute

U. S. and Brazilian officials have begun talks to try to settle a trade dispute at the World Trade Organization over U. S. cotton subsidies, the U. S. ambassador to Brazil said Feb. 3.

The South American agriculture giant was expected to present a definitive list of U. S. targets for retaliation in coming days.

Until last month, Brazilian authorities said they had seen no signs from their U. S. counterparts that the United States wanted to negotiate a settlement.

Now, the tone appears to have changed.

“I would like to underscore the will of the United States to avoid retaliation,” Ambassador Thomas Shannon said at a news conference in the capital, Brasilia.

“Retaliation and counter-retaliation is not good for anyone,” said Shannon, who presented his credentials to President Luiz Inacio Lula da Silva earlier.

Brazil got the formal go-ahead to impose sanctions on U. S. imports from the WTO in November 2009 after the trade body ruled the U. S. government spent too much on subsidies for cotton farmers and on an export credit guarantee program.

The case has threatened to sour U. S.-Brazil relations and is being closely watched by the U. S. farm lobby.

Major changes to cotton subsidies or to the export credit program would require approval of U. S. Congress.

Total sanctions could be worth $829 million based on 2008 data for the export credit guarantee program, Brazil’s Foreign Trade Ministry said in December.

Brazil had already identified more than 200 possible U. S. targets for trade retaliation, ranging from foodstuffs to textiles to pharmaceuticals.

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