In 1985, as part of Brazil's gradual transition from military rule to democracy, through the indirect decision of an electoral college, Brazil’s executive office returned to the hands of civilians for the first time since 1964. Only a month after his inauguration on March 15, President Tancredo Neves suddenly fell ill and died on April 21, 1985. In his stead, Vice President elect José Sarney took office, adding consternation to the rocky transition. Nevertheless, the process of redemocratization continued under Sarney, culminating with the Brazilian Constitution of 1988 and the country's first direct elections in 1990. Brazil's society and economy have undergone significant changes during the new democratic era, known as the New Republic. In its early years, hyperinflation plagued the young democracy. After the impeachment of Fernando Collor, the country’s first democratically elected president in over 25 years, Finance Minister and soon-to-be two-term president Fernando Henrique Cardoso stabilized the economy with the implementation of the Plano Real in 1994. Since 1985, Brazilian leaders have actively attacked the country's pervasive social inequality with numerous policies, most notably Bolsa Família (the Family Scholarship) initiated during former union leader Luiz Inácio “Lula” da Silva’s first presidential administration (2003-2007). This ushered in an era of political dominance of the executive branch by his political party, the Partido dos Trabalhadores (Workers' Party in English), in the 21st century. In international relations, Brazil has also taken a leadership role in South-South partnerships such as MERCOSUR in the Americas, and the Comunidade dos Países de Língua Portuguesa, which includes a majority of African members. Brazil is also a founding member of BRICS, an alliance of some of the world's fastest-growing developing economies, including Russia, India, China, South Africa, Egypt, and Iran.

The period beginning in 1985 marks a transitional phase in the position of the United States in global affairs. According to President George H. W. Bush, the end of the rivalry with the Soviet Union offered the United States a new era of both great hope and uncertainty. During the first sixteen years of the period, the direct military involvement of the United States in places such as Panama, the Persian Gulf, Somalia, and the Former Yugoslavia, took place alongside the country's leadership in efforts to open markets and increase trade across the world. To this end, in December 1992, the United States, Canada and Mexico signed the North American Free Trade Agreement (NAFTA). In December 1994, the United States hosted the First Summit of the Americas in Miami in the hopes of establishing a broader Free Trade Area of the Americas (FTAA), which, with the exception of Cuba, aimed to cover every nation in the Western Hemisphere. The terrorist attacks of September 11, 2001 shifted United States national security strategy to the prevention of future attacks through preemptive and, if necessary, unilateral military action. The foreign policy and national security programs of succeeding presidential administrations would place varying emphasis on issues such as climate change, the strengthening of democratic political regimes, public health and the choice of cooperation or competition with emerging world powers such as Russia and China.

Brazil's diplomatic leadership on the global stage represents a profound change in Brazil-US relations during the New Republic. In a December 15, 2010 interview with the Brazilian magazine Veja, US Ambassador to Brazil Thomas Shannon described Brazil as transitioning from a regional power with global ambitions to a global power with regional interests. As such, from 1985 onwards, in international groups like the World Trade Organization (WTO) and the United Nations (UN), the United States has increasingly encountered Brazil as a leader on a range of global policy matters including climate change, energy, intellectual property protections, social inequality, and trade. In the field of international security, Brazil-US relations have wavered, with Brazil opposing US-led operations such as Operation Uphold Democracy in Haiti (1994-1995) and the Iraq War (2003-2011), during which Brazilian diplomat Sérgio Vieira de Mello was killed while working as UN High Commissioner for Human Rights. The United States-led War on Terror also raised suspicions in Brazil by claiming that the triple border between Brazil, Argentina, and Paraguay acted as a hub for terrorist activity. However, Brazil has also taken leadership in initiatives supported by the United States, such as the United Nations Stabilization Mission in Haiti (MINUSTAH) from 2004-2017.

Key events

• Brazil/U.S. Aspen Global Forum (1998 : Saõ Paulo, Brazil)

Key figures

• Cardoso, Fernando Henrique
• Lula, 1945-

Key groups

• BRIC countries
• MERCOSUR (Organization)
• Partido dos Trabalhadores (Brazil)

Key subjects

• Brazil--Politics and government--1985-2002
• Brazil--Politics and government--2003-