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Azevedo looks to resurrect WTO with patient diplomacy

Roberto Azevedo, Brazil's permanent representative to the World Trade Organization (WTO), speaks during an interview with Reuters in London
Roberto Azevedo, Brazil's permanent representative to the World Trade Organization (WTO), speaks during an interview with Reuters in London

By Alonso Soto and Anthony Boadle

BRASILIA (Reuters) - Roberto Azevedo, picked on Tuesday to head the World Trade Organization, is in every respect the quintessential Brazilian diplomat: a well-spoken, competent and smooth negotiator with a knack for wooing adversaries into his corner.

A career diplomat with two decades of experience dealing with trade disputes, Azevedo will need those qualities more than ever to bridge the gap between developed and developing nations if he wants to reboot stalled global trade negotiations and breathe new life into the Geneva-based WTO.

It is a huge task. With the global economy still struggling, protectionism is on the rise and faith in free trade - and the WTO itself - is running low in many countries.

Azevedo has built his career advocating for a country with a less-than-stellar record when it comes to free trade. Brazil is the most closed major economy in the Americas, according to International Monetary Fund data, and it played a key role in derailing talks last decade to create a hemisphere-wide free trade area.

But Azevedo insists that Brazil's oft-criticized trade policies won't influence his actions as director-general of the WTO when he succeeds France's Pascal Lamy on September 1.

"As director of the WTO, I will not be representing Brazil," he told Reuters last week.

Brazil's stance in global trade talks - which critics often describe as obstructionist - frequently put it at odds with the United States and the European Union. But that same stance won plaudits in the developing world, where Azevedo's WTO candidacy had wide support.

Azevedo, 55, has been closely linked to the WTO since its creation in 1995 and is considered an insider, which he says will be an asset as he strives to restore relevance to the multilateral trade body.

"I believe members and negotiators are more ready to follow the lead and accept as broker someone they are familiar with, someone they trust," he said in a recent Twitter message.

Since the "Doha Round" of global trade talks lost momentum in 2008, multilateralism has ceded ground to bilateral trade negotiations and pacts between regional trade blocs, such as the 12-nation Trans-Pacific Partnership under negotiation.

Coming from Brazil, an emerging market with the world's seventh-largest economy, Azevedo believes, will give him greater pull to give the multilateral trade talks a fresh start and lift the WTO from its current gridlock.

"Ambitious solutions are required for more trade liberalization, to eliminate major trade distortions, to use trade to bring development for all, but especially to the poorest countries," he said in a video on the Brazilian foreign ministry website.

An avid soccer fan who plays pick-up games in his spare time, Azevedo is widely admired by fellow diplomats for his negotiating skills and ability to quickly grasp complex issues.

"I remember we had a very complicated case involving subsidies in the air transport industry and I was very impressed at how he figured it out so fast," said Celso Lafer, Brazil's first ambassador to the WTO and a former foreign minister.

Azevedo has represented Brazil at the WTO since 2008. Before that, he was Brazil's chief negotiator for the Doha Round. He has also supervised negotiations between the South American trade block Mercosur and countries outside Latin America, and headed the Brazilian foreign ministry's dispute settlement unit.

GREATER CLOUT FOR DEVELOPING NATIONS?

In the race to head the WTO, Azevedo beat out Mexico's Herminio Blanco, a key player in negotiating the North American Free Trade Agreement between the United States, Canada and Mexico but seen by developing nations as too close to the interests of rich nations.

Blanco was widely seen as having the backing of the United States, whose plan for a Free Trade Area of the Americas folded a decade ago due to Brazilian resistance.

Brazil's more gradual approach to bringing down trade barriers could bring a swing in favor of developing nations at global trade talks.

Azevedo has vowed to make the WTO dispute settlement system more accessible to developing countries, enabling them to litigate alongside and against the big industrialized nations that bring most of the cases now.

Experts said the choice of a new WTO director from an emerging economy could help encourage more developing nations to open up to free trade.

"This is a major move to bring more developing countries into the liberalization of world trade. It doesn't necessarily mean reinvigorating the Doha Round because it has a lot of political baggage," said Jeffrey Bergstrand, professor of finance at the University of Notre Dame.

Azevedo has led an effort to get the WTO to discuss the impact of exchange rates on global trade, which many members do not consider a relevant issue for the trade body and one that should be dealt with at the International Monetary Fund.

The currency debate is unlikely to gain traction under Azevedo's tenure as head of the WTO because it would need member countries to take it forward.

Azevedo will need persistence and patience to shake up the WTO, qualities a Brazilian diplomatic colleague says he has.

"Even after hours of talks that dragged on until late at night he was always cordial, patient," said the diplomat. "That extraordinary patience is what is needed to revive the WTO. Azevedo will not stop until he finds a solution for a problem that you think was buried and done with."

(Editing by Kieran Murray and Cynthia Osterman)

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