The free trade agreement between Mercosur and Singapore, signed on Wednesday, July 20, in Paraguay, could increase the Gross Domestic Product (GDP, sum of goods and services produced) by R$28.1 billion (US$5.1 billion) by 2041. The Ministry of Economy released the estimate.
According to the ministry, the agreement should increase R$21.2 billion in Brazilian exports to Singapore and R$27.9 billion in imports over the next 20 years. According to the ministry’s calculations, investments in Brazil would increase by R$11.1 billion over the same period.
Currently, the Asian country is the sixth-largest destination for Brazilian exports. In June, Brazil sold US$939.4 million to Singapore, equivalent to 2.88% of the total exported by the country.
The trade concentration occurs because the country, which is an island, represents one of the leading commercial warehouses on the planet, concentrating the trade flow to Southeast Asia.
In a statement, the Ministry of Economy said that the agreement represents a “process of gradual rapprochement of Brazil with the Asian continent, a priority for the country’s foreign and economic policy.”
Negotiated since 2018, the agreement with Singapore should increase Mercosur’s exports to the Asian country by US$500 million per year. In 2021, the economic bloc exported US$5.9 billion to the island and imported US$1.3 billion.
WIth information from Agência Brasil