Argentina: new missions to sustain trade with Brazil

RIO DE JANEIRO, BRAZIL – The recovery process experienced by the economy last year had the trade balance surplus as one of its key variables. Exports to Brazil were one of the keys to this phenomenon. Sales to the main trading partner became the highest in the last seven years and allowed reversing the historical deficit in the bilateral relation.

However, according to consulting firms surveyed by the Brazilian Central Bank, the activity could stagnate this year and affect imports. Given this scenario, the Argentine embassy in Brazil is promoting new trade missions to sustain the level of sales. The focus will be on regional economies, the automotive sector, and a group of priority items with “great business opportunities”.

The delegations will be formed by representatives of provincial or municipal governments, as the case may be, and a group of businessmen. The first trip will take place this month. It will be headed by Martín Llaryora, mayor of Córdoba, a key city in the relationship with Brazil due to the automotive and auto parts factories located there.

The Focus report, prepared by the Brazilian Central Bank with the forecasts of private analysts, has been cutting growth projections for 2022 since last year. The latest data estimates an increase of 0.29%, virtually stagnation. Government sources acknowledge that this could harm Argentine exports of some industrial products. However, they are betting that part of this fall will be reversed with a better performance of cars and auto parts, which have been thriving at the local level.

The trade mission from the City of Córdoba will be the first one, but a trip with representatives from Santiago del Estero is already planned, headed by Governor Gerardo Zamora, and also a visit of businessmen and officials from the municipality of La Matanza, which will include Mayor Fernando Espinoza and Débora Giorgi, Secretary of Production of that district.

Beyond the fact that the delegations will seek to promote the sale of products from their regional economies, the Argentine embassy in Brazil, headed by Daniel Scioli, identified thirty priority sectors “with great business opportunities” – food and beverages such as meats, dairy products, wines, and olives. Fertilizers, machinery, and a wide range of metal-mechanic articles also appear.

The epicenter of the rounds will be the Federation of Industries of Sao Paulo. Scioli generated an oiled link with the new president of the entity, José Gomes Da Silva, a businessman who knows Argentina very well because he has a textile plant in Santiago del Estero. Gomes Da Silva is also the son of José Alencar, vice-president of Brazil during one of Lula’s governments, so there is also close political contact.

After reaching US$12 billion during 2021, sales to Brazil became the highest in the last seven years and allowed reversing a trade deficit that hit the BCRA’s coffers in 16 of the previous 18 years. With a substantial boost in energy exports at the end of last year, the balance showed a surplus of US$70 million that the Foreign Ministry intends to sustain by deploying commercial actions, lowering logistics costs, and boosting production financing.