São Paulo – BTG Pactual’s chief economist and former Brazil’s National Treasury secretary, Mansueto Almeida, said on Thursday (6) at the Arab-Brazilian Chamber of Commerce (ABCC) in São Paulo that Brazil’s economy remains strong, with a projected trade balance surplus in 2024 and better economic indicators than a decade ago. However, he warned that rising public debt must be controlled amid global uncertainty.
Almeida participated in the first ABCC Connects event of the year, which addresses topics relevant to the institution’s member companies. This edition, titled Economic Perspectives 2025, featured Almeida and Angela Martins, CEO for Latin America at First Abu Dhabi Bank. The discussion was opened by the president of the ABCC, William Adib Dib Jr., and moderated by its vice president of Foreign Trade, Daniel Hannun.
“We have a new government in the United States, a new president [Donald Trump] who is implementing tariff hikes, and no one knows exactly how large these increases will be,” said Almeida, noting that tariff increases in global trade tend to affect economic growth and trigger inflationary movements. Higher inflation in the US leads to higher interest rates, a stronger dollar, and the depreciation of other currencies.
“That said, Brazil is somewhat protected, but not entirely, because our bilateral relation with the US has a slight surplus for them. It’s very different from the relationship with Mexico, Canada, and China. So, directly, there’s no reason for the US to collide with Brazil and raise import tariffs on our products. However, indirectly, anything that affects production chains—we learned this post-Covid—has a very strong impact on the entire economy,” said the economist.
Almeida said that, Brazil’s domestic market has shown consistent growth, achieved high and consecutive trade surpluses, and is expected to harvest a “super crop” of grains this year. On the other hand, interest rates are expected to continue rising to control inflation.
“Although we don’t have any major sectoral issues, we have a very serious problem, which is the fiscal issue, leading to debt growth in a tight labor market, higher inflation costs, and prompting the Central Bank to raise interest rates to reduce inflation,” he said. Despite these challenges, Almeida expressed being “more optimist” about the Brazilian economy today than he was ten years ago.
With the Arabs, more opportunities than challenges
While there is uncertainty about the global economy and Brazil’s relationship with the US, there is a partnership and opportunity environment with the Arab Gulf countries, said Angela Martins.
In her presentation, the executive from First Abu Dhabi Bank said Gulf countries, especially the United Arab Emirates and Saudi Arabia, are committed to the energy transition and see it as a key part of their economic diversification. In the UAE, she noted, sectors unrelated to oil already account for half of the gross domestic product.
Martins said investors from Arab countries have been demanding a greater presence of Brazilian companies in their territories. “Over the years, Brazil has always focused on exporting Brazilian goods and attracting Arab investments to Brazil. However, there’s been an expectation from the Arab side that this would eventually change, with increased exports from Arab countries to Brazil and Brazilian investments in the Gulf region. This has grown more significantly in recent years,” she said.
Martins highlighted several sectors in the Gulf countries that Brazilian companies can explore, either due to demand or because Brazil is competitive in those areas. Among the sectors she mentioned were healthcare, education, logistics, technology, sustainability, energy transition, and food, as food security remains and will continue to be a challenge for the Gulf countries.
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Brazil hits record trade surplus with Arab nations
Translated by Guilherme Miranda
