34 INTERNATIONAL & REGIONAL BUSINESS DEVELOPMENT
Brazil
Ricardo Latkani Business Development Manager: Brazil
MARKET OVERVIEW With continuous shifts in the global trade landscape, countries from around the world are increasingly looking to Brazil as a partner ripe for trade and investment. Brazilian stocks reached an all-time high in the first half of the year, showing that the country is truly starting to make its mark as a key, competitive player on the global stage. With the country’s natural resources, innovative businesses, and creative mind set, Brazil has catapulted to the front of the international trade frontier, with three key exports in particular shaping Brazilian trade: machinery, sustainable agriculture, and aerospace. The economy, however, lost steam in sequential terms in Q4 2019. Fixed investment fell to an over three-year low, while consumer spending softened. Shifting to Q1, although growth prospects had looked optimistic at the start of the year, intensifying headwinds—mainly from the coronavirus outbreak—could have derailed momentum. The epidemic’s impact on the Chinese economy, commodity markets, and global financial conditions appears set to curtail Brazilian economic activity in Q1, particularly in manufacturing, tourism, and trade. Moreover, the virus’ emergence in Brazil raises concerns that a full-on outbreak could cause the reform agenda to take a backseat. On 16 March, the government announced a USD 30 billion emergency bill to combat the fallout from the coronavirus. Measures include social assistance payouts, deferring corporate taxes and direct funds to mitigate the spread of the virus. That said, the government reaffirmed its commitment to its spending cap and noted that the package would be funded by cuts elsewhere in the budget.
WALVIS BAY CORRIDOR GROUP
Over the last 12 months, Brazil’s foreign trade volumes decreased by 7.3%, resulting from factors such as structural adjustments in the trade relationship between the largest economies in the world, with increased global uncertainty and adverse developments in GDP growth in international trade. On the domestic front, there is an economic recovery taking place, with a clear impact on the country’s trade balance. Foreign demand for Brazilian products last year was hit by the slowest global growth in a decade, uncertainty surrounding the U.S.-China trade dispute, and a wave of political and economic turmoil across Latin America.
OPPORTUNITIES The Brazil to Walvis Bay international trade corridor offers significant opportunities for traders between the Latin American and southern African markets. The potential exists for Brazil to utilise Namibia as a hub for a myriad of products. The food sector, where Brazil is an export leader, is especially appealing as this sector relies on time-efficient logistics solutions. The following opportunities could be of interest:
