MercoPress. South Atlantic News Agency

Brazil's export strategy vulnerability exposed

Brazilian former Industry, Trade and Tourism minister Dorotea Werneck described the export situation of Mercosur member countries, Brazil, Paraguay and Uruguay as a “tragedy” because of their high dependency on current markets evolution.

Ms. Werneck said that Brazil's current growth is undergoing "a delicate moment" because its exchange rate is undervalued and is taking advantage of the good performance of the world economy with a surge in the price of commodities, which is not a sustainable scenario in global affairs.

"The origin of that growth can't be found in Brazil's internal situation. Uruguay and Paraguay follow the same track which is a tragedy", emphasized the former minister before a forum of Mercosur businessmen in Asunción, capital of Paraguay.

An economist and advisor to Brazil's Foreign Trade Foundation and Foreign Trade Association, Ms Werneck on the other hand praised Argentina which will have a 7% growth rate this year based on an adequate exchange rate.

"Differences of this kind among Mercosur member countries lead to internal disputes in the block and the impossibility to decide on a joint export strategy to third countries", she underlined.

Further on Ms. Werneck highlighted that countries which have significantly advanced have done so exporting and specifically mentioned, Japan, South Korea, China, Mexico and Chile.

But she also warned that the export process demands time, investment and the first results can only be perceived at least two years later.

"You can't play with exports, you have to be ready, a prevention job is needed to be prepared for events that can lead to the closure of markets", said Ms. Werneck apparently in direct reference to the foot and mouth disease outbreaks in Brazil which have led 30 countries to ban Brazilian meat imports.