São Paulo – The effort to diversify sources of revenues in the Arab countries, aiming to reduce oil-dependency, opened many opportunities to the Brazilian construction industry. That was one of the facts presented this Wednesday (1) to entrepreneurs of the sector at the workshop House & Construction, held at the headquarters of the Arab Brazilian Chamber of Commerce in São Paulo.
“The Arab countries, especially the ones in the Gulf, have been trying to diversify their economies, get out of their oil sector-dependency,” said the coordinator of the Arab Chamber’s Information Management, Marcus Vinícius, at the workshop. He mentioned areas that are beingthe focus of investments due to this fact, such as port infrastructure and tourism.
In North Africa, there are many Arab countries in full development, which also has been upping the demand for construction industry products and services. The Arab Chamber’s Business executive, Fernanda Baltazar, mentioned Mauritania, Morocco, Tunisia, Libya, Egypt and Djibouti as countries at this stage that offer opportunities.
Added to these factors, there are others that point to a promising scenario for the construction industry in the Arab market, such as the housing deficit, which generates a strong demand for housing, and the large events that will take place in the region in the next few years, such as Expo 2020, the world fair in Dubai between October 2020 and April 2021, and the 2022 FIFA World Cup in Qatar, four years from now.
Vinícius talked about the size of the Arab market, with a total population of 406 million, a Gross Domestic Product (GDP) of USD 2.5 trillion and the fact that it holds 60% of the world’s oil reserves.
The coordinator mentioned construction material total imports by the Arab countries. For instance, in the sector of ornamental stones, the most imported products are marble, travertine and smooth-surface alabaster, reaching USD 560 million in 2016. However, Brazil sells mainly granite, with USD 9 million in exports of the product in the same year.
Regarding ceramic tiles, the Arabs import mainly glazed and enameled tiles, spending USD 2 billion in 2016. Brazil exported these products to Arabs that year, but only USD 3.3 million. Of construction material, Arabs imported especially cast-iron pipes and hollow profiles, spending USD 622 million worth of these products in 2016. Brazil exported mainly metal shovels to them, to a total of USD 2.4 million.
Fernanda Baltazar said that in North Africa, Brazil already opened a door, being recognized for good-quality construction products and services. “Brazil has been present, historically it has always been, it executed important contracts, and that’s an entry point, makes it easy for you to be there,” said Baltazar.
She also mentioned, as advantages of selling to the Arab markets in Africa, the fact that they have access to sea, partnerships and agreements with the Gulf countries and Europe and that many mirror close countries, as is the case with Djibouti and Ethiopia. The average economic growth of these countries ranges from 5% to 6%, according to Baltazar.
The executive stated that the Algerian government has been encouraging the development of infrastructure and trying to diversify its economy. She also talked about Egypt, which is in a new stage, post-Arab Spring, with the recovery of tourism, a policy to lure in investments, the construction of a new city and housing for the low and middle classes. Sudan also has, according to her, ongoing projects focusing on infrastructure.
The Arab Chamber’s analyst of International Business in the Arabian Gulf, Thiago Ramirez, presented to the audience some of the main ongoing construction projects in Saudi Arabia, United Arab Emirates and Qatar, and named the main construction firms in each country.
The Arab Chamber
Within this scenario of opportunities in the construction sector of Arab countries, the advisor to the presidency for strategic affairs, Tamer Mansour, discussed the additional efforts the Chamber has made and is planning to help its members to enter these markets, such as relaying information and biddings dates and the organization of business missions. “There are many opportunities, it’s important to know where’s the entry.”
The event was opened by the Arab Chamber’s CEO, Michel Alaby, who presented the work of the Arab Chamber and detailed how its many departments operate. He recalled some facts of the relations between Brazil and the Arab countries, followed by or led by the organization, such as the first exports of halal chicken from Brazil, in 1979, the first meeting between the Arabs and South American heads of state, in 2005 and, more recently, the Brazil-Arab Countries Economic Forum, organized by the Arab Chamber this year with over 700 people in attendance.
Seeking opportunities
The companies that attended the event were companies interested in entering or expanding their market share in the construction sector of Arab markets. That’s the case with Tigre, who sent its executive of International Sales, Patricia Soares. The company already exports pipes and fittings to the region, but it wants to also export painting tools. “There’s a demand for our products there. Any developing country has a demand for our products,” he said.
The commercial manager of CS3 Mármores e Granitos, Kleberson Secchim, attended the workshop due to its interest in exporting to the Arab market. “The workshop brought up the opportunities that exist in the Arab countries,” said Secchim to ANBA, pointing out that the company’s already focusing on the Arab market.
Fabricio Rolim, from the International Business department of the Arab Chamber, attended the event because he believes that the Arab Chamber is crucial to mediate the relations of companies with the Arab world.
The Arab Chamber listed some events in which it will organize the participation of Brazilian companies in the next few months, such as the Damascus International Fair, in Syria, in September, the Feira Middle East Fair, also in September, in the UAE, a business mission to Algeria in October, and a business mission to Qatar om December.
Translated by Sérgio Kakitani
