Recommendation for Brazil trade policy

Essay by elitebluesUniversity, Master'sB, April 2004

download word file, 4 pages 4.2

An overview

Brazil, a country of 162 million inhabitants with a massive gross domestic product (GDP) of more than US$977 billion, is the largest economy in Latin America and the 10th largest in the world. Real GDP growth was approximately 3 percent in 2000, still in welcome comparing with the slowdown real growth in 1999. The Inflation has been kept in line with the Government's target of 8% in 2000(Country Commercial Guide, 2001). The process of economic liberalization initiated in 1990s has produced significant changes in Brazil's trade regime and investment regimes, resulting in a more open and competitive economy. Developments in trade activity were better than expected after the financial crisis of late 1998, favourable economic and investment climate results in substantial increase of foreign direct investment (FDI) since 1997. (Trade Policy Review Body, 2000)With the substantial trade liberalisation, Brazil has become an important market for US and EU exporters of goods and services as well as an important source of imports.

Imports have increased as a result of generally lower tariffs and reduced non-tariff barriers, but various barriers to trade still exists in different fields. The Brazilian government is emphasizing increased trade opportunities for the different sectors through trade reform and the removal of trade barriers to improve foreign trade performance. The table 1 in appendix shows the recent economic performance of Brazil. And the main trade partners of Brazil are the United States and MERCOSUR, especially Argentina, which is one of Brazil's most important markets, followed by the European Union (EU). The main suppliers to Brazil are, in decreasing importance, the EU, the United States, and Argentina


With the economic liberalization initiated in 1990s Brazil's current trade policy is much more liberalized comparing with the situation decades ago. Manufactured exports become more important for Brazil...