São Paulo – A country that grew on average 7% over the last three years, is located between Asia and Europe, has low production costs, good infrastructure, six industrial zones and also offers fiscal incentives to international investors. The requirements may be applied to Egypt, the target of a seminar on Thursday (8), at the Brazilian Association of Auto Parts Manufacturers (Sindipeças), in São Paulo, organized by the Arab Brazilian Chamber of Commerce.
The objective was to motivate businessmen in the sector to participate in a trade mission to Egypt, scheduled for May. At the occasion, the commercial consul of the Embassy of Egypt in São Paulo, Mahmoud Mazhar, made a presentation of the business possibilities in the land of the pyramids.
"The Egyptians are like the Brazilians, and love to buy,” said Mazhar, explaining that, in that country, the domestic market for vehicles grew 253% between 2003 and 2008, a proof of how auto parts companies from Brazil may have profits supplying products to carmakers that operate there: 24 in all. Egypt has 83 million inhabitants, with average income of US$ 5,400.
Mazhar also explained that Egypt has the largest rail network in Africa, with 5,000 kilometres of railways, as well as a good general transport, communications and energy infrastructure. "We are connected to the Indian Ocean and the Mediterranean through the Suez Canal. We even export fresh flowers to Europe, as we are so close,” he said. The country’s foreign sales totalled US$ 29.8 billion in 2008, with US$ 56.6 billion in imports.
With regard to taxes, fee exemption is offered for a period of up to ten years according to the company project and to a demand that it produces in the local market. "We also accept 100% foreign capital in the company and full rights on the transfer of dividends, among other points,” said Mazhar.
According to the secretary general at the Arab Brazilian Chamber, Michel Alaby, the government of Egypt has been seeking the establishment for some time with the objective of attracting entrepreneurs from the country to the Brazilian automotive sector. And the replacement part market in the country is strong. “The number of cars that circulate in Cairo is large, as in São Paulo, but hooters are used more there than here,” he joked. “We have all we need for success in this mission, with great possibilities for direct contact with local entrepreneurs,” he said.
For the trip, meetings have been scheduled at the Ministry of Investment and with the General Authority of Foreign Investment, as has a visit to a free zone and to at least two carmakers.
The Sindipecas foreign trade division representative at the seminar, Marcio Faveri, said that the union bets on the Middle East. "It is a market that needs better exploration, as the fleet is similar to the Brazilian one,” he said. The national auto parts sector had revenues of US$ 38 billion last year, with investment of US$ 512 million. Foreign sales totalled US$ 6.6 billion, and the main buyers were Argentina, the United States, Germany, Mexico and Venezuela.
The Arabs appear in the ranking of the twenty main commercial partners, scenery that should start changing in coming years. Mainly with regard to Egypt. That, at least, is the bet of Márcio Codogno, director of Cofran, a maker of mirrors and lights. "We already export to over 20 countries, including some in the Middle East. The interest, in the case of Egypt, was to discover how developed the local market is, to observe its strategic position and the tax breaks offered,” said Codogno, he himself a candidate for participation in the trade mission organized by the Arab Brazilian Chamber in May.
*Translated by Mark Ament
