Brasília – The Brazilian government increases the projected trade balance surplus this year from USD 50.1 billion to USD 56.7 billion. Revised every three months, the estimate was made public this Monday (1st) by the Ministry of Economy. In 2018, the country posted a positive trade balance of USD 58.959 billion.
This increase, however, will not occur due to an increase in foreign sales but because both exports and imports will decline from the original projections.
According to the ministry’s Special Secretary of Foreign Trade and International Affairs, exports are expected to end this year with a 2% year-on-year decline. On the other hand, imports are expected to decline 1.9%.
In the exports’ case, the reason is a deceleration of the global market and a decrease of some goods’ prices. Imports will decline because the Brazilian economy is taking longer than expected to recover.
“Brazilian foreign trade expectation is not great not only because of the overall Brazilian economy situation of slow recovery but also because of the global picture. Global economy will have an even lower growth due to a deterioration of foreign trade relations. Brazil obviously experiences the effects of this,” Foreign Trade secretary Lucas Ferraz said.
In Q1 2019, Brazil’s trade balance dropped 9.6% from a year ago, to USD 27.13 billion. This was the lowest surplus for Q1 since 2016.
Year-to-date through June, Brazilian exports reached USD 110.89 billion, a 1.8% decline over a year ago under the daily average concept. Imports, however, increased 0.8% year-on-year, to USD 83.76 billion.
Translated by Guilherme Miranda