Trade in Brazil

Brazil reported a trade surplus equivalent to 807 Million USD in June of 2012. in times gone by, from 1991 until 2012, Brazil Balance of Trade averaged 1310.5900 Million USD reaching an all time high of 5659.4000 Million USD in July of 2006 and a record low of -1845.3000 Million USD in December of 1996. Brazil has an export-oriented economy. The main exports are transport equipment, iron ore, industrial raw materials, soybeans, footwear, coffee, autos, automotive parts, machinery. Brazil imports machinery, electrical and transport equipment, chemical products, automotive part and electronics. The primary trading partners of Brazil are The United States, European Union and Argentina. This page includes a graph with chronological data for Brazil Balance of Trade.

The balance of trade is the difference between the monetary value of exports and imports in an economy over a certain period of time. A positive balance of trade is known as a trade surplus and consists of exporting more than is imported; a unconstructive balance of trade is known as a trade deficit or, informally, a trade gap. The balance of trade forms part of the current account, which also includes other transactions such as income from the international investment position as well as worldwide aid. If the current account is in surplus, the country's net international asset position increases correspondingly. Equally, a deficit decreases the net international asset position. The Balance of Trade is identical to the difference between a country's amount produced and its domestic demand - the difference between what goods a country produces and how many goods it buys from abroad; this does not include money respent on foreign stocks, nor does it factor the concept of importing goods to produce for the domestic market.

The EU is Brazil's biggest trading partner, accounting for 22.5% of its total trade (2009). It is part of Mercosur and part of the EU's ongoing negotiations for a free trade conformity with that regional group. Brazil is the single biggest exporter of agricultural products to the EU, accounting for 12.4% of total EU imports (2009) and ranks as the EU's 10th trading partner. In goods, the EU runs an overall trade deficit with Brazil of over €4.1 billion (2009but has a surplus in commercial services trade of €2.4 billion (2009). The EU  is the biggest foreign investor in Brazil with nest egg in many sectors of the economy.

The Brazilian market is relatively highly protected with an applied customs averaging tariff of 12% and the EU consistently encourages Brazil to reduce tariff and non-tariff barriers, and to maintain a stable regulatory situation for European investors and traders. Brazil is a key interlocutor for the EU in the on-going WTO Doha Round of world trade talks.

The backbone of the EU's future bilateral trade relations with Brazil will be a wide-ranging EU-Mercosur Association Agreement which will also result in the creation of a vast free trade area. This agreement which is currently under compromise should provide a boost to regional trade integration among the countries of Mercosur and stimulate new opportunities for trade with the EU by removing tariff and non-tariff barriers to trade. The Mercosur-EU AA will cover, among other issues, trade in goods and services, investment, intellectual property rights (IPR) aspects including protection of environmental indications, government procurement, technical barriers to trade and sanitary and phytosanitary aspects.

Trade in Brazil

Until summer 2004 there was gradual but substantial progress in the negotiationwhich, however, stalled in September 2004. Since then, regular acquaintances have taken place both at ministerial and technical level in order to explore ways on how to re-engage the process.  The Madrid Summit, which brought together Heads of State and Governments from Latin America, the Caribbean and Europe, as well as imperative non-state actors, resulted in a decision to re-launch negotiations of the EU-Mercosur Free Trade Agreement - a process which is now under way.

Brazil was the United States' 8th largest goods export souk in 2011.

U.S. goods exports to Brazil in 2011 were $42.9 billion, up 21.2% ($7.5 billion) from 2010, and up 180% from 2000. U.S. exports to Brazil accounted for 2.9% of taken as a whole U.S. exports in 2011.

The top export categories (2-digit HS) in 2011 were: Machinery ($7.9 billion), Mineral Fuel ($6.3 billion), Aircraft ($5.4 billion), Electrical Machinery ($4.6 billion), and Plastic ($2.1 billion).

U.S. exports of agricultural products to Brazil totaled $800 million in 2011. Leading categories include: cotton ($323 million), dairy products ($40 million), wheat ($30 million), and sugars and sweeteners ($21 million).

U.S. exports of private commercial services* (i.e., excluding military and management) to Brazil were $19.9 billion in 2011 (preliminary data), 21% ($3.4 billion) more than 2010 and 219% greater than 2000 levels. Other private services (business, professional, and technical services, telecom services, and financial services), travel and royalties and license fees categories accounted for most of the U.S. services exports to Brazil.

Brazil was the United States' 17th largest supplier of goods imports in 2011.

U.S. goods imports from Brazil totaled $31.4 billion in 2011, a 30.9% increase ($7.4 billion) from 2010, and up 126% from 2000. U.S. imports from Brazil accounted for 1.4% of overall U.S. imports in 2011.

The five largest import categories in 2011 were: Mineral Fuel and Oil (crude) ($10.5 billion), Iron and Steel ($3.5 billion), Machinery ($2.3 billion), Spices, Tea, and Coffee (coffee) ($2.0 billion), and Wood Pulp ($1.0 billion).

U.S. imports of agricultural products from Brazil totaled $4.1 billion in 2011, the 4th largest supplier of Ag imports. Leading categories include: coffee (unroasted) ($1.9 billion), fruit and vegetable juices ($321 million), tobacco ($278 million), and raw beet and sugar cane ($270 million).

U.S. imports of private commercial services* (i.e., excluding military and government) were $6.9 billion in 2011 (preliminary data), 32% ($1.7 billion) more than 2010 and up 254% from 2000 level. The other private services (business, qualified, and technical services), travel services, and royalties and license fees categories led U.S. services imports from Brazil.

U.S. foreign direct investment (FDI) in Brazil (stock) was $66.0 billion in 2010 (latest data available), up 19.7% from 2009.

U.S. direct investment in Brazil is led by the manufacturing and finance/ indemnity sectors.

Brazil FDI in the United States (stock) was $1.1 billion in 2010 (latest data available).

Brazil’s reported direct investment in the U.S. is led by the comprehensive trade sector.

Sales of services in Brazil by majority U.S.-owned affiliates were $24.7 billion in 2009 (latest data available), while sales of services in the United States by majority Brazil-owned firms were $972 million.

 OPPOSITE Rio de Janeiro's best-known shopping mall, just before the tunnel that takes drivers to the beach resorts of Copacabana and Ipanema, stands a gleaming new showroom for JAC Motors, a state-owned Chinese car maker. The importance of the location is appropriate: imported Chinese cars have suddenly become a visible presence on Brazil's roads. This has alarmed Brazil's car industry and President Dilma Rousseff's government. Last month a 30-percentage-point tax increase on cars with less than 65% local content took effect, taking the tax on some imported models to a punitive 55%—on top of import tariffs.

The government's response is a mix of short-term protectionist measures combined with modest steps towards more constructive longer-term policy changes. The tax rise on cars was announced last September, as part of a new engineering policy. The aim was to bully carmakers without plants in Brazil to hurry up and build them. This seems to be working: JAC Motors, BMW, and Jaguar Land Rover, a unit of India's Tata Motors, have all announced plans to build factories in Brazil since the import tax was unveiled.

The industrial policy also features an experimental cut in the payroll tax for footwear, textile, furniture and software firms. But officials are at pains to point out that, rather than help specific industries, the main thrust of the new policy is to try to boost competitiveness more generally by promoting innovation, higher schooling and training.

The second emollient is that the real has depreciated by 17% against the dollar since its peak in late July. That is partly because investors fled emerging markets but also because of government intervention, in the form of taxes on short-term capital inflows. At the same time, the Central Bank has taken advantage of the economy's soft patch to cut its benchmark interest rate, from 12.5% in August to 11%. With inflation at 6.5%, the real interest rate is much lower than at any other time in the past decade.

But industry also wants to see fewer taxes, cheaper energy, less bureaucracy and better transport networks, says Paulo Skaf, FIESP's president. On these things the government is moving far more slowly, if at all. However narrowly targeted, protectionism will not only raise prices in Brazil but risks sending the wrong message to businesses. Across Latin America, trade with China is growing but partly at the expense of intra-regional trade in manufactures. Brazil should lead a move to tear down all trade barriers within Latin America, thus turning the Chinese challenge into an opportunity, says Mr Amaral.

In 2005, Brazil's total exports more than doubled to US$118 billion from $58 billion for 2001. Over that same period, imports into South America's largest country grew some 30% to $74 billion from $56 billion.

Brazil's trade surplus has expanded more than 16-times to $47 billion from $2.6 billion over the past 4 years.

With a population of almost 200 million, Brazil is the world's leading exporter of sugar, coffee, beef and orange juice. Soybeans are Brazil's fastest-growing shipments, powered by the appetites of China's 1.3 billion consumers. Other major exports include aircraft, vehicles, iron ore, steel, textiles and footwear.

o remain an agricultural superstar in global trade, Brazil has to deal with growing pains. The recent collapse of World Trade Organization talks in Doha shut the door on an initiative to remove U.S. and European farm subsidies and trade tariffs that would have spurred Brazil's exports onto new heights of success. Also, a weak American dollar makes Brazilian products more expensive and therefore sensitive to international competition. And Brazil is notorious for poorly constructed and maintained roads, railways and seaports. Three hour delays at airports are common. This is further aggravated by an inefficient customs service.

Brazil is one of the top ten world economic powers. Its cautious taxation and monetary policies, together with the necessary microeconomic reforms, have given the Brazilian economy solid basis allowing it to withstand the global economic crisis.

Brazil has abundant natural resources and its economy is relatively diversified. 

Trade in Brazil

A major agricultural power, Brazil is the world's first producer of coffee, sugar cane and oranges, as well as one of the largest producers of soy. It also attracts many world groups in the food industry and biofuels. Brazil has the world's largest commercial livestock herd. Nevertheless, agriculture's contribution to the GDP is relatively small, accounting for only 6.6%, yet the sector represents 40% of its exports. Forests cover half of the country, with the largest ombrophilous forest in the world situated in the Amazon Basin. Brazil is the world's fourth largest exporter of timber.

Brazil is also a great industrial country. It benefits from its mineral ore wealth and is the second world exporter of iron and one of the main producers of aluminum. As an oil producer, the Brazil is aiming to become self-sufficient in the near future. The country is asserting itself more and more in the textile, aeronautics, pharmacy, automobile, steel and chemical industry sectors.

and France enjoy a close bilateral relationship based on values shared by the two countries: promotion of democratic principles and human rights, strengthening of international law and multilateralism, promotion of the development and respect of social justice, preservation of peace and security, commitment to non-proliferation of weapons of mass destruction and to disarmament, protection of the environment and cultural diversity.

France has recognized Brazil as its special partner in South America and as a global player in international affairs. The two countries are committed to strengthening their bilateral cooperation in the areas for which working groups have been created: nuclear energy, renewable energies, defence technologies, technological innovation, joint cooperation in African countries and space technologies, medicines and the environment.

France and Brazil entered a formal strategic alliance in 2008. France supports Brazil's ambition to become a global player on the international scene, and has been a strong supporter of the Brazilian bid for a permanent seat on the United Nations Security Council.Through significant technology transfers, France intends to help Brazil acquire key technologies of a major world power in the military, space, energy and technology sectors.

Brazil and France share a 673 km border between the state of Amapá and French Guiana. The cross-border cooperation between the two countries has enjoyed increased vitality. This cooperation makes it possible to better integrate French Guyana into its geographical environment, to respond to the concerns of both parties about the various cross-border risks, to encourage human exchanges and trade and to develop the economy of the Amazon region, respecting the local populations and extraordinary environment. The granting to France, on the initiative of Brazil, of observer status within the Amazon Cooperation Treaty Organization, will strengthen this cooperation. The construction of the Oyapock River Bridge over the Oyapock River, decided during President Lula’s visit to France, will make the Cayenne-Macapá road link possible. The bridge is scheduled to be completed in 2010. In May 2012 Brazil sent troops to guard its border with France (Guiana)

Although Brazil has made substantial progress in reducing traditional border trade barriers (tariffs, import licensing, etc.), tariff rates in many areas remain high and continue to favor locally produced products. Brazil's barriers to trade are a cause for concern for the US Government and the European Union (EU), both of whom continue to work through regional trade accord negotiations and at the WTO level to influence tariff and non-tariff barriers. This report touches upon a broad range of trade regulations that may affect US companies seeking to export to Brazil. 

Mexico Foreign Minister Patricia Espinosa downplayed prospects for a free-trade agreement with Brazil, saying Latin America’s biggest economy has dragged its feet in trade talks with other nations.

“Brazil currently has trade negotiations under way that date far back with many different countries,” Espinosa said in an interview in Bloomberg’s Mexico City offices yesterday. “This makes us think that it’s a country in which there isn’t much flexibility for a negotiation.”

Mexican President Felipe Calderon and former Brazilian leader Luiz Inacio Lula da Silva vowed last year to start talks on a free-trade pact. A deal would help Mexico diversify trade away from the U.S., which buys 80 percent of its exports, though it may be thwarted by Brazil’s efforts to boost protection for manufacturers being hurt by a rally in its currency and increased competition from China.

 Trade flow problems between Argentina and Brazil continue to exist” revealed Brazilian Industry Ministry Executive Secretary Alessandro Teixera in direct reference to the non automatic trade licenses conflict that flared between both countries a few months ago.

Non automatic import licences are an instrument contemplated by the World Trade Organization given certain periods of time and certain conditions.

“There are still trade flow problems. However, a little trouble is always expected between the Mercosur trade bloc members,” Teixeira stated from Asunción, at the Mercosur summit.

Teixeira explained that in order to move forward with negotiations to solve the trade dispute, several private meetings between Brazilian and Argentine negotiators were taking place in Paraguay.

"Doing Business in Brazil" is a follow-up to the 1999 publication "Doing Business in Latin America". Along with the portfolio’s annual "Capture the Americas — Latin America" seminar series, it is another tangible sign of the Government’s commitment to promoting Australian trade and investment in Latin America, and supporting the efforts of the business community.

The importance of expanding Australia’s relations with Latin America was highlighted by the report, tabled in September 2000, on "Australia’s Trade and Investment Relationship with South America" by the Trade Sub-Committee of the Joint Standing Committee for Foreign Affairs, Defence and Trade of the Australian Parliament. The report assessed that the region had considerable market expansion potential and could play a more important role from Australia’s trading perspective.

The Government has responded positively to the thrust of the recommendations. In particular, at the time of his visit to Brazil in March 2001, my colleague, Mr Downer, and I jointly announced the creation of the Council on Australia Latin America Relations (COALAR). The Council, which will include prominent business representatives with experience in Latin America, will advise government and business on ways to further Australia’s commercial, economic and political interests in the region.

Of all the region’s markets, Brazil stands out. It is already Australia’s largest trading partner there, and, due to its economic size and diversity, offers significant potential.

My first official overseas assignment as Australian Trade Minister in September 1999 included a visit to Brazil. I was struck by the warm and positive relations that exist between our two countries. I was able to speak to Australian business people on the ground and obtain first-hand assessments of the opportunities for our exporters.

While the commercial relationship is growing, it remains less than optimal: Brazil, the ninth largest economy in the world, accounts for only 0.5 per cent of Australia’s total exports. Clearly, the potential for further commercial cooperation is substantial.

Trade in Brazil