Trade between Brazil and African countries recovers

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Trade between Brazil and African countries recovers

3:15 CAT | 07 Dec 2017

Macauhub

Brazil’s trade with African countries, which worsened in recent years after reaching a record high in 2008, is recovering, in a new diplomatic context, according to figures from the Brazilian Ministry of Industry, Trade and Services.

Official figures show that Brazilian exports to African countries totalled until US$7.94 billion to October, 26.16% more than in the same period of 2017.

Brazilian imports from African countries grew by 16.01% in the first 10 months of the year, to US$4.739 billion, with the balance favourable to Brazil by US$3.201 billion.

In 2008, Brazil’s balance of trade with African countries was at one point over US$25.931 billion, more than twice the amount in 2016.

Brazilian official figures showed that Egypt is still the main destination for exports to Africa, ahead of Nigeria, while for imports the main source is Algeria, followed by Nigeria.

A professor at the Federal University of Rio Grande do Sul, Paul Fagundes Visentini, recently told the Africa Monitor newsletter that the factor that most affected relations with Africa was the economic crisis in Brazil, starting in 2014.

Visentini said that the government of President Michel Temer, whose foreign policy focuses more on business than the previous governments of Dilma Rousseff or Luiz Inácio Lula da Silva, wants to deepen economic relations with Africa, to meet the needs of entrepreneurs, who are his major supporters.

On visits to Africa in May (South Africa, Botswana, Malawi, Mozambique and Namibia) and October 2017 (Morocco, Ghana, Nigeria, Botswana, Ivory Coast and South Africa), the minister of Foreign Relations, Aloysio Nunes, was accompanied by business delegations, organised by the Brazilian Export and Investment Promotion Agency (Apex) and by the National Confederation of Industries (CNI).

Some of the major business groups in Brazil have divested or streamlined their African investments, including in Portuguese-speaking countries, including Petrobras, Odebrecht, OAS, Queiroz Galvão, Camargo Corrêa and Andrade Gutierrez.

However, some large-scale projects in Africa, with Brazilian capital, continue to move forward, such as the Nacala Logistics Corridor (CLN), which involves mining group Vale.

The project, which has Japan’s Mitsui & Co. as a partner, last week closed a financing agreement of US$2.73 billion, involving a consortium of Japanese and international banks.

Source: Macauhub