Category: Geopolitics

Information about international affairs that can impact the Brazilian economy.

Brazil and Paraguay sign free trade agreement for vehicle sector

Brazil and Paraguay signed on Tuesday an agreement to boost autos and auto parts trade between the two countries. Under the agreement, Brazil will grant free trade treatment to Paraguayan automotive products immediately and Paraguay will allow Brazilian products to enter the country with lower taxes, which are of up to 2% and will gradually decrease until free trade conditions are met by 2022.

Bolsonaro proposes Fernández breaking the ice in Montevideo

The presidents of Brazil, Jair Bolsonaro and Argentina, Alberto Fernández, could meet on March 1 in Montevideo, in a sign of truce after months of tension between the two heads of State. Bolsonaro made the proposal of the meeting on the occasion of the inauguration of the Uruguayan president, Luis Lacalle Pou, upon hosting on Wednesday the Argentine Foreign Minister Felipe Solá in Brasilia.

Brazil and Argentina discuss bilateral trade and diplomatic wounds

Brazilian President Jair Bolsonaro on Wednesday hosts Argentina’s Foreign Affairs Minister Felipe Solá, who will also meet his counterpart Ernesto Araújo. They will discuss bilateral trade, the Mercosur customs union and Venezuela, according to official sources. Relations between the two key trade partners worsened late last year as Bolsonaro’s far-right administration clashed with Alberto Fernandez’s left-leaning government.

USA removes Brazil from the list of developing countries

The U.S. Department of Commerce reported its decision to remove Brazil from the list of developing countries, which may restrict trade benefits granted to nations in this category. Some practical consequences for Brazil may include the end of the unilateral exemption of export tariffs by the Generalized System of Preferences (GSP), the right to partial trade agreements with other developing countries, and part of the loans from the World Bank.

Brazil’s Amazon deforestation doubled in January

Deforestation in Brazil’s Amazon rainforest doubled in January compared with a year ago, reaching a five-year record for the month, according to the national space research agency Inpe. More than 280 sq km were cleared in January, an increase of 108%, and a record for the month since data started being collected in 2016. Deforestation in the Amazon soared last year.

COFCO International changes Brazil head

Chinese-owned grain trader COFCO International has added up Tony Tian, Helen Song and Alfonso Romero were to its executive committee, expanding the number of members to seven, and appointed Philip Xu as new managing director Brazil, replacing Valmor Schaffer. Tian will take on the additional role of Managing Director Regions for Brazil and North America and is to relocate from Geneva to Sao Paulo.

Centauro shares up 12% after $212 mn Nike deal

Grupo SBF, the formal name of Brazil’s sports goods chain Centauro, closed a $212 million deal to take over Nike operations in the country. Centauro’s shares (CNTO3.SA) rose more than 10% on Thursday mid-morning trading in Sao Paulo after the announcement. The deal, which will add 24 Nikes stores to the current Centauro’s 200 stores, still needs to be approved by Brazilian antitrust watchdog CADE.

Volvo to invest $ 237mn in Brazil

Swedish truck and bus manufacturer Volvo announced an investment of R$ 1 billion ($237 million) in Brazil in the period between 2020 and 2023 for research and development of products and services, including construction of equipment and marine engines. Brazil was the second market of the group in the world in 2019 when heavy truck sales grew 58%, light heavy 55.5%, buses 73% and exports, mainly to Colombia and Chile, went up 77%.

Airline Gol signs agreement with American Airlines, shares jump 5.5%

Shares in Brazil’s budget airline Gol rose as much as 5.5% on Tuesday after signing a codeshare agreement with American Airlines, that will create “the most frequent service between the United States and South America”. Gol will connect customers to more than 30 destinations in the USA, and American will offer flights to Uruguay and Paraguay, in addition to the Brazilian cities of Curitiba and Foz do Iguaçu.

Meatpackers build up expectations on Chinese market

“ASF, coronavirus and a new outbreak of bird flu influence consumer habits and may drive Chinese demand for Brazilian meat,” said Francisco Turra, president of Brazil’s meat industry association ABPA. The new threat reported on Saturday comes as China has been trying to increase local poultry output to substitute for pork. Last year, Chinese imports of Brazilian chicken rose 34% while its imports of Brazilian pork jumped 61%.