São Paulo – Imports of goods from Arab countries to Brazil reached USD 6.5 billion last year, up 23.4% from 2016. The most imported items were fuel and fertilizers, according to information released by the Arab Brazilian Chamber of Commerce based on data from the Brazilian Ministry of Industry, Foreign Trade and Services.
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“This hike in imports reflects a pickup in the economy for Brazil, whose purchases are increasing,” Arab Chamber president Rubens Hannun said this Tuesday (16) after a breakfast with Chamber members at the organization’s headquarters in São Paulo. “Imports increased much more than exports,” he noted.
Sales from Brazil to the Arab countries came out to USD 13.6 billion in 2017, up 18.4% from 2016. Although imports outgrew exports, Brazil saw a record-high USD 7.1 billion surplus in trade with Arab countries.
The Arab world accounted for over 10% of Brazil’s foreign trade last year. “The Arab countries remain the fourth biggest destination for Brazilian exports, and the second biggest in food products,” Hannun said during the meeting with Chamber members.
He remarked that the export result was a very positive one, since the beginning of 2017 “was fairly complicated,” mostly due to the Federal Police’s Carne Fraca operation, a probe into meat packers and Agriculture Ministry inspectors that compromised the image of Brazilian meat products abroad.
“The Arab Chamber acted fast. We set up a crisis management committee and made connections between the Agriculture Ministry and Arab ambassadors. We also travelled to Arab countries with minister Blairo Maggi to explain what was taking place,” Hannun told those in attendance. “We went about providing information onsite,” he stressed.
According to him, these actions helped minimize the operation’s impact on exports from Brazil, making it clear to Arab importers that police investigations were restricted and did not concern the majority of Brazil’s meat industry. Hannun revealed that the committee will remain active for fast problem-solving.
As a whole, exports from Brazil to the Middle East and North Africa were driven by agribusiness products. In addition to the work done in the case of Carne Fraca, Hannun said 2017 was a year of “intense activity” for the Arab Chamber, at a time of turmoil in Brazil as well as in the Middle East and North Africa. “We were present, and effectively so, in 14 out of the 22 Arab countries,” he said.
Brazil’s trade with Arab countries – exports and imports included – was up 20% in 2017 from 2016 to over USD 20 billion.
Expectations
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In his presentation to attending members, Arab Chamber CEO Michel Alaby said exports from Brazil to Arab countries will increase by at least 10% in 2018. He believes sales could exceed USD 15 billion. The biggest amount ever was USD 15.1 billion, in 2011.
Alaby expects exports to increase for poultry, beef, sugar, cereals and iron ore, which account for a combined 70% of foreign sales. “Whoever buys more ore does so because their industry is growing. This means consumption and income will go up,” the CEO explained.
According to Hannun, Brazil supplies 10% of Arabs’ food needs. This means there’s room for growth, especially in higher value-added items like organic foods. The Arab Chamber also expects imports to go up in 2018, especially for fertilizers, fuel and plastic.
*Translated by Gabriel Pomerancblum