The Center for European Policy Studies (CEPS) in Brussels and Fundação Getulio Vargas in Rio de Janeiro join forces in this timely collection of papers dedicated to a critical assessment of the Brazil–EU Strategic Partnership. The EU and Brazil established a Strategic Partnership during the Lisbon Summit in July 2007. The partnership provides a framework for dialogue and cooperation between Brazil and the EU on a number of topics, including effective multilateralism, trade, human rights, climate change, sustainable energy, the fight against poverty, and regional integration.

As the editors note with a hint of disappointment, at the launch of the Brazil–EU Strategic Partnership in 2007, the outlook could have hardly been more promising. Both Brazil and the EU are leaders on their respective continents, have huge domestic markets, share democratic and cultural values, and have no tensions over security threats. Yet, almost seven years since its creation, one could argue that little or nothing concrete has been accomplished by the Brazil–EU Strategic Partnership. What explains such dismal performance? Is there a larger role for cooperation between Brazil and the European Union, both economically and with respect to the normative framework of a multipolar world order?

The authors of this ambitious collection try to answer these questions by examining five different topics of interest to the Strategic Partnership: (1) global macro-economics, (2) trade policy, (3) climate change, (4) international norms and security policy, and (5) continental regionalism. The resulting picture is one of an uneasy economic bilateral relationship, with diminished prospects for further economic integration through a preferential trade agreement, but increased convergence of interests and scope for further cooperation on global topics.

On global macro-economics, the papers in this collection illustrate the tensions in Brazilian and European macro-economic policy objectives. Daniel Gros, Cinzia Alcidi, and Alessandro Giovannini argue, persuasively, that loose monetary policy in developed economies (and the resulting currency misalignments) cannot explain Brazil's poor economic performance in recent years, because the Brazilian economy is relatively more closed to foreign trade than all developed and even BRICS (Brazil, Russia, India, China, and South Africa) economies. According to these authors, the answer to Brazil's post-commodity boom economic malaise is more, rather than less, trade liberalization.

This conclusion directly contradicts the paper by Vera Thorstensen, Emerson Marcal, and Lucas Ferraz. These authors argue that exchange rate misalignments undermine the protective effect of import tariffs in overvalued countries, such as Brazil, therefore exposing the domestic industry to unfair competition from artificially undervalued imports. In other words, stronger domestic currencies make imports artificially cheap, even when import tariffs are applied. This will in turn reduce or offset any protective effect that import tariffs may have, exposing the domestic industry to foreign competition. To offset the effects of exchange rate misalignments, the authors advocate for a special safeguard mechanism to be introduced in the context of EU–Mercosur negotiations as a way of affording more protection to a domestic industry that is already relatively insulated from foreign competition. In contrast, Alfredo Valadão offers a more balanced explanation for Brazil's recent economic woes. He explains that contraction in the commodities market after 2009 exposed the limits of the Brazilian economic growth model, which was based on social transfer programs and consumer credit expansion, largely financed by large trade surpluses. Valadão prescribes a new economic growth model, based on more market access for Brazilian exports, and a serious liberalization of the domestic market. A Mercosur–EU Preferential Trade Agreement (PTA) would be the lynchpin of such development strategy.

Unfortunately, the type of Mercosur–EU PTA envisaged by both Patrick Messerlin and Renato Flores is unlikely to generate any meaningful market access gains for either Brazilian or European goods. Both authors recognize that an ambitious PTA of the type favored by the EU is politically infeasible, given protectionist tendencies in most Mercosur countries and the EU's unwillingness to liberalize agricultural trade. The authors therefore propose a much more limited agreement, focused on sanitary and phytosanitary measures, mutual recognition of regulatory standards, technology transfer, environment, and climate change. Alfredo Valadão concurs, and proposes an ‘everything but tariffs’ bilateral agreement between Brazil and the EU, focused on non-tariff barriers and trade facilitation, combined with a ‘two-speed’ approach to negotiating liberalization commitments with recalcitrant Mercosur Members. The problem with these alternative approaches is that they cover topics that are either already subject to WTO disciplines or to multilateral negotiations. In the absence of meaningful market access gains on both sides, there is little or no inducement for the EU to shift its current negotiating focus from the US and Asia, and for Mercosur to overcome internal negotiating asymmetries. The suspension of Mercosur–EU talks on 21 July 2014 buttresses this view.

In contrast, the prospects for increased engagement between Brazil and the EU on climate change policy are starkly better. The papers in this collection express the hope that joint Brazil–EU efforts will succeed in pushing a more progressive international climate change agenda over objections of other emerging economies. A comprehensive paper by Eduardo Viola explains how Brazil established its leadership credentials by voluntarily cutting emissions at a time of breakneck economic growth, and by discreetly mediating between developed and developing countries in the context of the United Nations Framework Convention on Climate Change (UNFCCC) negotiations. Christian Egenhofer and Monica Alessi review the EU track record and leadership role in climate change policy, following the US withdrawal from the Kyoto Protocol in 2005. The authors in this collection are unanimous in pointing to climate change as one of the most promising areas for constructive engagement between Brazil and the EU, as illustrated by their close cooperation in Durban (2011) and Doha (2012) United Nations Compensation Commission (UNCC) summits.

In the realm of international norms and security policy, the papers in the collection demonstrate that Brazilian and European interests are again mostly divergent. Although Brazil and the EU share a commitment to multilateralism, to a rules-based international system, and to democratic values and human rights, their outlook and priorities with respect to the normative framework of an emerging multipolar world order differ significantly. Alcidez Vaz Costa explains that Brazil is projecting power extraterritorially by actively engaging in a number of ‘mini-lateral’ fora, such as the WTO G-20, BRICS, and the IBSA (India, Brazil, South Africa). Brazil has also leveraged its South–South engagement with emerging powers in furtherance of its long-term objective of the structural reform of the UN Security Council and the IMF. Costa also emphasizes that Brazil's skepticism of the responsibility to protect (R2P) principle stems from its security interests, which are focused on traditional concerns such as continental and maritime territoriality, and resource protection. For these reasons, Brazil has proposed the principle of ‘Responsibility While Protecting’, pursuant to which the implementation of humanitarian military interventions must be closely monitored by the UN Security Council. Giovanni Grevi depicts a Europe caught between a firm commitment to the Atlantic alliance, and the need to help frame a new multipolar and interdependent world order. He also stresses that the shift in US geostrategic interests will require that the EU become more pragmatic as a security provider, and focus primarily on regional security threats and on non-state actors, such as terrorist networks. Grevi sees Brazil's leadership role in the military intervention in Haiti as indicative of the potential for future cooperation with the EU on humanitarian peacekeeping. Costa considers that global topics such as climate change, food, energy, and environmental security are better suited for increased Brazil–EU engagement.

Finally, on continental regionalism, Susanne Gratius and Miriam Gomes Saraiva discuss how Brazil has been projecting power in Latin America by promoting regional integration at the three levels of Mercosur, UNASUR (Union of South American Nations), and CELAC (Community of Latin American and Caribbean States), with the ultimate objective of creating its own region of influence outside the sphere of US power. Michael Emerson considers that the European experiment is a template for robust economic integration, despite the flaws in the design of a monetary union. Politically, the EU regional integration strategy has shifted toward projecting European norms and values into former Soviet countries, in competition with Russia. The EU seeks to attract countries such as Ukraine, Moldova, Georgia, and Armenia to its sphere of influence through initiatives such as ‘Deep and Comprehensive Free Trade Agreements’ (DCFTA), the Council of Europe, the Organization for Security and Cooperation in Europe (OSCE), and the European Bank for Reconstruction and Development (EBRD).

In this reviewer's opinion, the overall picture that emerges from this book is that of an uneasy economic and political relationship between Brazil and the European Union. The articles in this comprehensive and well-organized collection of papers demonstrate that, despite the early promise, the center of gravity of the Brazil–EU Strategic Partnership is increasingly shifting from bilateral and regional economic issues toward more diffuse global topics, where convergence is easier, but concrete results more difficult to achieve. The Strategic Partnership's bleak performance thus far may in fact stem from its own over-sized ambition. The most recent joint action plan issued under the partnership provides for over 30 sectoral policy dialogues between Brazil and the EU. Increased focus on a dozen or less topics where concrete results can be delivered would unquestionably increase the prospects for a more effective partnership. In the meantime, the economic potential of the Brazil–EU partnership will remain untapped, to the detriment of consumers and stakeholders on both sides of the Atlantic.