Tereza Cristina<\/strong> \u2013 We have a relationship of friendship with the Arab countries. The Arab community in Brazil is very numerous and varied, more so from some countries than others, but we sustain long-standing ties of tradition and friendship with the Arab world. Moreover, the agricultural Brazil, the Brazilian agricultural world has been exporting to Arab countries for many years now, so much so that we have many Halal-certified companies here. We have made progress and improvements in order to be able to supply the goods the way each Arab country wants them. We have evolved a lot. The last industry (to have Halal items) was poultry. We used to not have Halal slaughter (in poultry farming) because it\u2019s more complicated, but many companies have it now, and others are trying \u2013 because you have an adaptation and transition phase that\u2019s expensive \u2013 due to the importance of our exports, especially so with animal protein, with poultry. These companies have developed Halal slaughter processes, and it has become a normal thing at a plant. You\u2019ll often travel to a small town and see people doing Halal slaughter to sell to Arab countries.<\/p>\n And are the Arab countries an important market for the broader agribusiness industry?<\/strong><\/p>\n For sure, and I believe we can make progress in this market. We currently export sugar, poultry, beef, maize, refined sugar, soybeans, raw coffee beans, tobacco, livestock. Livestock exports are trending up. It was formerly not usual in Brazil. That began to change, if I\u2019m not mistaken, with sales from Par\u00e1 to Lebanon, and now other countries are importing via S\u00e3o Paulo. It\u2019s a market that didn\u2019t exist until a short while ago, and now it\u2019s getting bigger and bigger.<\/p>\n Do you see Brazil selling livestock as a good thing?<\/strong><\/p>\n I don\u2019t think this is Brazil\u2019s business. I think Brazil\u2019s business is exporting beef, special beef cuts. We must move forward, export boneless meat, meat cuts, gourmet beef, but this is a niche nonetheless, and what does it do? It\u2019s an alternative for Brazilian producers. Not for the industry, but for the producers. Why so? When you sell, it\u2019s usually calves or weaners, and that even brings some balance [to the market]. But it\u2019s a market that cannot get much bigger than it is now. It\u2019s currently around 700,000 head of cattle, some say a million head (per year of livestock sold). I believe we can grow [in livestock exports], but in order for that to happen we must have a seaport, we must have EPZs (Export Processing Zones), which are where these animals are kept in quarantine to get vaccines, to undergo sanitary preparations before shipping off. We have a problem right now in Brazil, and in other countries as well, which is animal wellbeing. Part of society believes cattle should not be kept in ships for so long. But I think it\u2019s a market which needs to exist, considering the amount of animals you have in Brazil. Australia sells to all of Asia. It\u2019s a major livestock exporter, and I think Brazil has a niche in the Arab countries.<\/p>\n Minister, how was your contact with the Arabs up until now? I\u2019m aware that you have been with Arab ambassadors. What have you done so far when it comes to Arab countries, and what do you plan to do?<\/strong><\/p>\n When it took office, I had some ambassadors come over. We had some controversy regarding exports. I met with several ambassadors over dinner at the CNA (the Brazilian Confederation of Agriculture and Livestock) at the request of the Ministry of [Agriculture]. I called on [CNA chairman] Mr. Jo\u00e3o Martins [da Silva Junior] to help us out with that. The dinner was great, we got to talk, the president [Jair Bolsonaro] ended up going as well, it was great. Now we\u2019re in the second phase. I wish I had been able to make a visit to some Arab countries. I didn\u2019t because there was Ramadan in May, and we\u2019re aware that during Ramadan things are more complicated, so I left it for the second half. I should go in September. I\u2019m visiting three or four countries. That\u2019s not decided yet, it\u2019s being worked on by the [Ministry\u2019s] Secretariat for International Relations. The president is also visiting a few countries<\/a>. I should go to other countries than he, I\u2019m not sure whether I\u2019ll go to all countries. I have pledged to go to the UAE, Saudi Arabia and Egypt. (Kuwait should also be visited according to the Agriculture Ministry\u2019s Secretariat for Foreign Trade and International Relations.<\/em>)<\/p>\n What is the criterion in choosing countries to visit? Is it market size?<\/strong><\/p>\n Market size, some requests we got from those countries for other goods from Brazil. We\u2019re taking into consideration the whole of international relations, both theirs towards us and ours towards them. There are some requests for entry of some products. Agricultural trade with Arab countries always runs a surplus on Brazil\u2019s side, but there are products Brazil imports from those countries that help balance things out. We have been getting requests to get sanitary certificates for olive oil, olives, dates, apricots. There are some items that they have, because they\u2019re in the desert, that it\u2019s harder to produce, but there are products that they are traditional producers of and which we import. And then you have new products, like dairy, which Brazil is interested [in exporting]. We are working on a list of new products to discuss with those countries, and this will be very interesting for Brazil. Last week we got visited by a group from the UAE (Supreme Council for National Security and delegates) \u2013 and by one from Saudi Arabia before that \u2013 and we discussed investment in Brazil by those countries\u2019 funds. We had a meeting with president (Bolsonaro) which included me, minister Bento (Costa Lima Leite de Albuquerque J\u00fanior, of Mines and Energy), minister Tarc\u00edsio (Gomes de Freitas, of Infrastructure). We discussed several issues, many business owners from across the country were there. In agriculture, they expressed interest in planting many things; even something that caught me by surprise \u2013 hay, to feed their animals. To make hay here in Brazil and export to them.<\/p>\n How do you view this question of investment? Would it be a good thing to have Arabs investing in Brazilian agribusiness?<\/strong><\/p>\n I think it\u2019d be great, because we need it. Brazil is an agricultural powerhouse, but Brazil needs longer-term investment. It\u2019s important for us to have partners abroad. It facilitates trade between countries, exports to those countries, and I believe it\u2019s great to get investments into improving our structures, into increasing innovation and technology. I think that\u2019s great.<\/p>\n There are restrictions to land ownership by foreigners in Brazil, aren\u2019t there?<\/strong><\/p>\n Yes. Right now, any foreigner can buy a very small fraction of land. That\u2019s one of the things that these (UAE) delegates inquired about at the meeting that I joined, but it\u2019s really up to National Congress whether we can sell land to foreign people.<\/p>\n Would you like to change that around? Will you work on this agenda?<\/strong><\/p>\n It\u2019s not a unanimous agenda in Congress, but I think it\u2019s an interesting one. Brazil is opening up its markets, liberalizing its economy, I believe that\u2019s part of that. No one\u2019s leaving the country with the land on their back. They\u2019ll manufacture here with Brazilian labor, like other companies do\u2026 Volkswagen is from Germany, then you have Volkswagen do Brasil, Volvo is Swedish\u2026 Anyway, we have several foreign companies that come to Brazil with their capital, but they\u2019ll employ people here, they\u2019ll build their factories here. So I think that provided that you have some \u2013 we have border land, we have the Amazon \u2013 I\u2019m not against it.<\/p>\n Would there be percentage limits as well (for land ownership)?<\/strong><\/p>\n Percentage limits as well. To bring that capital in, to allocate it here and to manufacture here, to add value and to be able to export. I don\u2019t see any problem in that, but I\u2019d like to make it clear that this is just my opinion.<\/p>\n Early this year relations with Arab countries went to a bit of a rough patch. Some meat packing facilities that used to export halal poultry to Saudi Arabia lost their accreditation. Is the Ministry keeping track of that? Will that change? Are Saudis going to accept halal slaughter as Brazilian companies perform it, or will these companies need to adapt before getting the green light again?<\/strong><\/p>\n That\u2019s not exactly so. What happened is Saudi Arabia had been putting out warnings\u2026 Brazil\u2019s poultry industry is very big and strong in Saudi Arabia. I don\u2019t have the exact figure by heart, but about 70% of the chicken consumed in Saudi Arabia is Brazilian chicken, and Saudi Arabia had been in talks with Brazilian exporting companies. They were telling them \u201cLook, we\u2019ll limit that to 400,000 tons.\u201d At one point, Brazil exported close to 700,000 tons of poultry to Saudi Arabia. \u201cWe\u2019ll limit that to 400,000 tons because we\u2019re looking to produce some domestically,\u201d and I\u2019m not sure if they\u2019d buy it from other countries, but the goal was not to depend on Brazil so much. That must have been it, and that\u2019s my own conclusion. These talks had been ongoing, it wasn\u2019t a surprise move. So much so that the industry didn\u2019t cry out much, because the country had an ongoing discussion with our business owners, our exporters. That\u2019s why some facilities got\u2026 They didn\u2019t really disaccredit, they just reduced their imports \u2013 Europe did disaccredit some Brazilian companies, but that was another issue. That was about the Carne Fraca<\/em> and Trapa\u00e7a<\/em> [Federal Police] operations back then. It wasn\u2019t about the Arab countries. So, it\u2019s only natural\u2026 And they (the Saudis) made an offer for Brazilian entrepreneurs to set up factories in Saudi Arabia to make halal poultry. That\u2019s what I heard, [that they would like to do] everything from breeding to halal production to slaughter domestically.<\/p>\n Breeding chicken in Saudi Arabia?<\/strong><\/p>\n Breeding chicken in Saudi Arabia. I\u2019m not sure they\u2019ll succeed, I\u2019m not familiar with the technology. I hope to see it soon, but I don\u2019t know how difficult it is, if and how much more expensive it will be. But that\u2019s what I heard here from business owners, from importers and from some Saudi authorities.<\/p>\n So the list of those that can export and those that cannot will remain as it is?<\/strong><\/p>\n That\u2019s what it is right now. What we can do is look at how things are going, whether they are importing from other countries, and put in a word so we can sell a bit more. The international market works in a very dynamic way, tomorrow we might be back to 600,000 tons. It\u2019s all a matter of timing, of what\u2019s going on in a country at a given moment. If I go to Saudi Arabia, that\u2019s one of the things I\u2019ll bring up with their government.<\/p>\n Minister, the Mercosur now has an agreement with the European Union, and one with the United States is a possibility. Should that somehow bring about changes in our role as a supplier to other countries, including Arab ones? Will we be able to supply all of them? It will be more favorable to export to the EU and USA.<\/strong><\/p>\n First off, it\u2019s too early. We have an agreement with the European Union, but it takes a while to happen. It takes two years before it\u2019s effective. It must go through congress in every country, both in the Mercosur and the European Union. Thirty-two countries total, if I\u2019m not mistaken. It takes a while. And then you have the time it takes for each product. But I think it (the agreement with the EU) was great for Brazil. It affords more opportunities for Brazil, it\u2019s a very high-quality market that we\u2019ll get access to. Brazil can supply animal and plant-based protein both to Arab countries and Europe. It\u2019s more complicated when it comes to the United States, because they\u2019re our direct competition, but I don\u2019t see any kind of problem there. The only problem is that Brazil needs plans. I believe these two years will be very important for Brazil to make plans with its production chains, to find out which market and which consumer it would like to reach in Europe. And I don\u2019t just mean the products we have today. I mean maybe doing better work on those products, adding value to them so we can provide a more finished product to those countries, which are more demanding countries.<\/p>\n You have touched on it earlier: ore, meats, sugar make up the vast majority of our exports to Arab countries. Are you satisfied with that or would you like to add other agribusiness products to that list? What products from Brazil do you think could sell on the Arab market?<\/strong><\/p>\n I think we need to be a bit bolder. Out of those USD 11 billion that Brazil exports [to Arab countries each year], agricultural exports make up USD 8 billion, but that\u2019s just ten different products; that\u2019s too little compared to our entire production. Those are commodities; now we need to add value. We don\u2019t have dairy here [on the export list], I don\u2019t see fresh fruit here. I wonder if we could export those. Dubai, in the UAE, is a huge air travel hub. Why not ship fruit and other goods by plane? I believe that this opening up of Brazil will allows us to find other opportunities, other products to supply to those countries. I believe we must take more chances; we must bring Arab business owners to Brazil and take Brazilian business owners to the Arab countries. As a matter of fact, it is the Ministry\u2019s role to regulate these sanitary certificates, but I believe we could prompt our businesspersons to be bolder, to try and supply items other than the ones that are currently being sold.\u00a0 These ten or eleven items, which are too few.<\/p>\n The Arabs insist that Brazil needs to buy more from them, since it exports so much product to them. Even though Brazil imports fertilizers from Arab countries, these imports fluctuate. During previous administrations Brazil began to invest in manufacturing fertilizers domestically. What will the country do regarding fertilizers?<\/strong><\/p>\n We need to structure out these imports better. What\u2019s going on? We don\u2019t have a very structured out chain. We had a problem in the past; we used to import more fertilizer, but I think we can plan out our growth, because we have deposits here. We need to get this exploration in order, and we are falling short in this industry right now. We could import more, but we must do so while doing our homework to balance things out. We need to manufacture locally as well. Ninety percent of the potassium utilized in Brazil is imported; we import 40% to 50% of our urea. Right now, we also import MAP, which is a phosphate. We need to sort out this chain better. We have this new government policy of lowering gas prices, of making cheaper urea in Brazil. I believe more plants can crop up to make urea here, avoiding the freight costs that imports entail. Right now we get a lot of urea [from abroad] because the gas is too expensive, and we don\u2019t have enough plants to cater to the size of our agriculture.<\/p>\n Do you believe that local fertilizer production needs investments, but not from Petrobras \u2013 which is making divestments in this industry?<\/strong><\/p>\n Exactly. This divestment has created an even bigger imbalance here [in Brazil\u2019s fertilizer market].<\/p>\n Exporters who supply the Arab market say shipping by sea is costly. Some say ships leave loaded up with commodities and have nothing to bring back on the return trip, so they will go to Europe to load up, and this drives up freight costs. What could be done to address this?<\/strong><\/p>\n I\u2019ve been speaking with minister Tarc\u00edsio, of Infrastructure, about sea transportation, cabotage. Brazil needs to make progress. I believe it\u2019s really important to look at how you could have this flow of goods on the way back as well, because that will surely mean cheaper freight, which would be good for Brazilian farmers who need fertilizers and making sea transportation from Brazil to Arab countries cheaper.<\/p>\n Could fertilizers be that solution?<\/strong><\/p>\n Maybe.<\/p>\n Changes are underway at Embrapa (the Brazilian Agricultural Research Corporation). Embrapa has always had some agricultural exchange with Arabs countries in North Africa. Will it keep playing this role of sharing technology during this new phase? Will Africa still be able to count on Embrapa?<\/strong><\/p>\n I think so. The problem with Embrapa is momentary. We\u2019ll empower Embrapa, we\u2019ll modernize Embrapa, its administration, so it can really have more technology to trade, to sell. Africa is going to be very important in a few years. We cannot think about innovation, in technology for right now; we must think ahead, 20 years ahead, 30 years ahead. I believe this is Embrapa\u2019s role, that Embrapa can bring technology to those countries whose climate is very similar to ours, improving and adapting our products to those areas. The way I see it, this needs to increase rather than decrease.<\/p>\n Mercosur has an agreement with an Arab country \u2013 Egypt \u2013 but many Arab countries have expressed a desire to enter into an agreement with the Mercosur: Palestine, Lebanon, Jordan, Morocco, Tunisia… What\u2019s your view on that? Would agreements with these countries be beneficial to Brazilian agribusiness?<\/strong><\/p>\n I think so. The more markets you make your way into, the better. In the Mercosur, there are some products we need to export as a bloc. As far as Brazil is concerned, I see it in a good light. Now, of course, you must discuss each case separately. But I don\u2019t see any obstacles. Within this wave, this liberal outlook that the government is preaching for the economy, entering new markets is key, and not only for agriculture, but also for our industry, which needs to get growing again. Brazil needs to get growing again. There\u2019s a lot of unemployed people who need jobs, so I think it\u2019s great that other markets are looking to sit down to talk with the Mercosur.<\/p>\n Arabs are very concerned with food security, because they\u2019re unable to produce much locally. Is there a way we could further cement our partnership as their suppliers? The Arab Brazilian Chamber is making a study on food security in the Arab countries.<\/strong><\/p>\n I think this is really important: credibility and trust between two countries. Anyone who has that problem \u2013 which is not the case of Brazil \u2013 needs to know who they can trust. This integration, this commercial interaction could lead to great progress.<\/p>\n![\"\"](\"https:\/\/anba.com.br\/wp-content\/uploads\/2019\/08\/terezacristina1.jpg\")
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