Brazil expects its trade flow to reach the half-trillion-dollar mark this year – Economy Minister
RIO DE JANEIRO, BRAZIL – Economy Minister Paulo Guedes said on Monday (15) at the opening of the Invest in Brazil Forum in Dubai. “Brazil is a country that is starting to open up again,” he commented.
The accumulated value of the trade flow (sum of exports and imports) from January to October this year is US$413 billion, according to data from the Ministry of Economy. It is the highest value registered since such records began in 1997. The monthly values of the trade flow vary but have averaged around US$45 billion a month.
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Guedes praised how Dubai has created wealth “in the middle of the desert sands” by using oil resources. He further stated that, for this reason, it is the “ideal partner” for Brazilian natural resources. “The investment capacity demonstrated in the last 40 years is what we need in Brazil,” he said.
The minister commented that Brazil already tried to use petrodollars to finance investments in the 1980s, “only they turned into debt.” This time, he added, “we want it to be a partnership.”
He also mentioned that there are already “notable” investments with Arab resources in Brazil. They are partnerships with the Mubadala fund, which has assets of US$232 billion and invests in 50 countries. He also said that Dubai has one of the largest ports in the world, and Brazil will privatize the port of Santos (SP).
Brazil Guedes already has US$100 billion in investments contracted for the following years in areas such as airports, telecommunications, and seaports. “Brazil is becoming the entrepreneurs’ paradise,” he said, contrasting with the “rentier’s paradise” supported by high-interest rates.
A “great change of axis” is underway in Brazil’s economic development, said the minister. After falling into a “trap of excessive state intervention,” a turn has been made toward creating a large market economy directed by private investment. “We expect you to participate in this change in Brazil,” he said.
He said that privileges in the social security system had been removed, and privatizations of companies were underway. The minister also cited the approval of the independence of the Central Bank and the change in regulatory frameworks for gas, oil, and railroads.
The government estimates a 5.3% expansion for the Gross Domestic Product (GDP) this year. The Organization for Economic Cooperation and Development (OECD) forecast for world growth in 2021 is 5.7%.
According to the OECD, for 2021, the government estimates 2.5% against the world average of 4.5%. The Brazilian financial market projections, by comparison, are 4.93% in 2021 and only 1% in 2022, according to the Focus survey released on November 8.
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