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This study has the objective of evaluating the economic effects of the Brazilian integration into the Free Trade Association of Americas - FTAA under two alternative scenarios. In the first, the adhesion of the Brazilian economy would happen as an isolated country. In the second, the joint adhesion of Brazil would follow the rules established for all members of MERCOSUR. The analytical framework is that of an applied general equilibrium analysis which permit the measurement of different impacts of simulations on selected economic indicators. The results point out that the joint adhesion of MERCOSUR countries as an economic block into FTAA, which is the position defended by Brazilian negotiators, is much more beneficial to the Brazilian economy than the integration as an independent country. The impacts of integration in FTAA on the growth of disposable income, taxation, and personal consumption are much higher under the second scenario. Therefore, this study supports the Brazilian posture that the FTAA should not be negotiated with isolated countries but taking into account all the previous agreements prevailing in South America.


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