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Jeb Bush: U.S. Likely to Slash Tariff (04/16/2007)
Date: April 16, 2007 

Author: Alan Clendenning 

Source: Business Week  A U.S. tariff on Brazilian ethanol will likely be reduced or eliminated within several years despite stiff opposition from American farmers, former Florida Gov. Jeb Bush predicted Monday. 

Bush, the brother of President George W. Bush, said he believes attitudes among key politicians in the United States will change as America boosts ethanol use and needs more supply from nations like Brazil, the top exporter of the renewable fuel.

The 54 cents per gallon tariff on Brazilian ethanol -- made from sugarcane much more efficiently than ethanol produced from corn in the United States -- "doesn't make sense to me," Bush told agribusiness executives in Sao Paulo.

"Over time, that tariff has to be phased out," said Bush, a co-director of the Interamerican Ethanol Commission lobbying for increased production of the fuel across Latin America.

Bush visited Brazil a month after his brother met in Sao Paulo with President Luiz Inacio Lula da Silva and struck an alliance to promote ethanol production and craft international quality standards so the fuel can be traded like oil.

Jeb Bush also criticized Cuba and Venezuela for their leaders' newfound opposition to increased ethanol production across the Western Hemisphere.

Both Cuban leader Fidel Castro and Venezuelan President Hugo Chavez used to speak warmly about ethanol's future, but came out harshly against it after the U.S.-Brazil agreement, contending that poor Latin Americans might starve if more agricultural land is dedicated to energy production instead of food.

"Mysteriously, for reasons I can't explain, they did a complete about-face," Bush said.

Without mentioning Venezuela by name, Bush said the United States needs to boost ethanol use because much of the petroleum consumed by America comes from "unstable sources of supply that are controlled by enemies of our country."

Asked later if he was referring to Chavez's anti-U.S. administration in Venezuela, Bush responded: "They're certainly not friendly to the U.S. in their current form."

Bush made the comments as Silva was heading to Venezuela to meet with Chavez during a two-day energy summit of Latin American leaders, where the two leaders' dispute over ethanol appeared likely to be a major point of debate.

The brother of the U.S. president was heading Tuesday to Brasilia to meet with government officials as the Latin American summit comes to an end in Venezuela.

The United States is the world's No. 1 ethanol producer, but experts say it can't meet potential demand. Brazil is in second place, but has much more available land to ramp up production.   
 
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