If the Arab League were a single country, it would be Brazil’s third most important economic partner

Brazil has increased exports to Arab countries and Israel under Jair Bolsonaro’s government. Three years ago, when he took office, there were fears about the government’s rapprochement with Israel due to the proposal to move the embassy from Tel Aviv, the international capital, to Jerusalem, which is still disputed with the Palestinians.

The risk would be the loss of exports to Arab countries. A Poder360 survey shows that this has not been confirmed. The increase in sales to Arabs and Israel was higher than the average increase in exports of 46% in the first half of the year compared to the same period of 2018, the last year before Bolsonaro took office.

Arab League member states bought US$8.3 billion from Brazil (Jan-Jun. 2022). In the case of Arab countries, the increase in exports was 62%. Other non-Arab Muslim-majority countries, such as Iran and Turkey, are not included in the list.

“During the pandemic, Brazil has been a constant and reliable supplier to Arab countries despite all the logistical problems. They appreciate this very much, and relations have been consolidated,” Osmar Chohfi, president of the Arab-Brazilian Chamber of Commerce, told Poder360.

The retired diplomat was secretary general of the Ministry of Foreign Relations (2nd in the hierarchy) in 2001 and 2002.

In the case of Israel, the increase was even more intense, with a 596% growth in exports from 2019 to 2022.

The main items were oil, frozen meat, and soybeans. By June, they totaled US$1.1 billion. For the first time, the balance sheet with Israel shows a surplus. In the past, it was always in deficit. It was affected by the inclusion of items in the sales menu that were not previously exchanged between the countries.

“The oil market opened up as an alternative to Russian supplies because of the war. Frozen meat, on the other hand, was the result of adjustments to the kosher standard that Uruguay and Argentina had already made,” the president of the Brazilian-Israeli Chamber of Commerce, Renato Ochman, told Poder360.

FOOD DOMINATES

The war in Ukraine has boosted purchases of food and fertilizers. In the first case, even Brazilian wheat went to Arab countries: US$335 million in the first half of the year – a 531% increase in four years. Brazil imports more than it exports.

According to Osmar Chohfi, the reason is that Brazilian wheat is well suited for making bread and dough, which require harder grains.

In the case of fertilizers, the exchange increased due to the war. Both the number of purchases and the value were higher. Since Russia and Belarus are the leading exporters of these goods and are related to the war, the prices of these products on the international market increased.

The Arab peak was 366% in this half-year. They reached a value of $3 billion, second only to fuels in the list of imports.

Israel ranks first on the list of the most imported products. The value of purchases from the country increased seven times.

In both cases, Brazilian purchases increased more than the general peak (48%) during this period. Arabs sold 126% more, while Israelis sold 103% more.

JERUSALEM OFFICE

The Bolsonaro government’s most significant move in Israel was opening an apex office in Jerusalem in 2019. The agency already had eight others, 2 of which were in China. They were kept. The Dubai (UAE) company operates in Arab countries and India.

The Jerusalem office is the only one open from Sunday to Thursday. Apex will open a “House of Brazil” in Israel from Sept. 4 to 9 at the Port of Tel Aviv to celebrate 200 years of independence. It expects 40 Brazilian companies to participate.

The Brazilian government’s rapprochement with Israel has attracted much attention. But foreign trade was and is guided by pragmatism.

It is a fact that Jair Bolsonaro has given rise to tensions. After his election in 2018, he said he wanted to move the Brazilian embassy in Israel from Tel Aviv to Jerusalem. This proposal pleases most Israelis but greatly angers the Palestinians and Arab countries that support it.

At the beginning of the government, there were diplomatic complaints, and then-Minister Tereza Cristina (Agriculture) also tried to avert harm. It worked.

Osmar Chohfi points out that if the Arab League were a single country, it would be nothing less than Brazil’s third most important economic partner behind China and the United States. And no one else. No wonder the effort was so great.

Brazil is one of the largest food producers in the world. It has size and competitiveness. It makes no sense not to buy more from Brazil. Besides, it is a big market. This proves that imports have grown even more than exports from Israel and Arab countries in four years.

But these advantages must not lead to the mistake of thinking that everything is fine. Brazil’s share of world trade is still negligible, given the country’s relative weight in the world economy.

Expanding internationalization should be a priority for any government in 2023. However, the issue tends to play a subordinate role in the election campaign.

With information from Poder360