MercoPress. South Atlantic News Agency
Brazil’s trade surplus down 40% in 2010 boosted by demand for imports
Brazil’s trade surplus this year should reach 16 billion US dollars, which is 40% below 2009, according to Foreign Trade Secretary, Welter Barral. He added it was too early to talk about 2011 targets, given the world scenario and “at this stage we can’t say if we are going to run a (trade) deficit next year”. Read full article
Comments
Disclaimer & comment rules“The minister also downplayed a direct link between the stronger Real and export difficulties.”
Dec 10th, 2010 - 02:33 am - Link - Report abuse 0Só pode ser maluco. So having the most overvalued currency in the world doesn't weight on exports? Such denial shows that there's an effort by the orthodoshiites to downplay that correlation - the one between currency and exports - perhaps because they're unwilling to curb the entry of foreign speculative money even if such money hurts national businesses. They put gringo speculators' interests above those of the industries.
Forgetit87, there is no denial. As I typed here before, a strong currency is good for the people. strong currency is purchasing power. The money what you receive in your hands is more worth. You can make allot of money, but what is it worth. that should always be the question. Okay, export, if you read well, what I think you did, you can maintain your export position, whatever position that is, by getting rid of the bureaucracy..what he meant is TAX reform (less bureaucracy, lower costs,etc etc)..“Fundamental Reform” what Brazil needs to become more competitive. If Dilma Rousseff truly thinks about that and truly will do, will be an amazing transformation for Brazil in it's history. It sounds exaggerated (of course some will type that here) but if you think about it, than Brazil can flex is muscle more than ever what it is capable.
Dec 10th, 2010 - 02:52 am - Link - Report abuse 0Those “gringoes” (yes I know it means foreigner in Brazil) speculators will come to Brazil anyway, even they are being taxed now, but they are going there because if you watch news what is happening in the US and Europe, they know the opportunities to make money is outside that bubble. As the boss of hedge fund Blackstone on the online magazine let its audience of a Goldman Sachs organized party let know is/was ”I'm in Brazil while the USS (ship) is sinking”. Now you can imagine what that means when an arrogant Hedge Fund manager says that openly and doesn't care than making money.
Fido, a strong currency might afford an inflated purchasing power, but one that facilitates the purchasing of imports only. That is not good for national businesses and increases the current account deficit. Brazil has had a current account deficit crisis in a very recent past. That was in 1999. The reason for that crisis was again the unsustainably strong currency. Argentina and some the East Asian countries - South Korea, Indonesia, Philippines, and Malaysia - also experienced a crisis in the period, and all of them, if I'm not mistaken, did so over a strong currency, all of them had pegged their respective currencies to the same value as the dollar. It is for me a bit unbelievable how the Brazilian Central Bank remains so flippant about the currency; it is as if they're so headstrong orthodox, that that prevents them from learning from experience. All they take into account in driving the economy is ideology.
Dec 10th, 2010 - 03:40 am - Link - Report abuse 0That bureaucracy doesn't help, I agree. A fiscal reform would also go a long way in reducing production costs and thus in making exports cheaper. But a fiscal and bureaucracy reform is not going to happen overnight. If the government tries to alter the status quo - and Dilma indication a disposition to do so when campaigning - there will be opposition from all sides: from state governors, from the opposition coalition for whom any gain by the government is a political loss, and from Dilma's more leftist allies in the government coalition who have supporters among public servants.
So the quickest way to boost exports, is really by devaluing the currency, just like China and other successful East Asian countries have done.
So the quickest way to boost exports, is really by devaluing the currency, just like China and other successful East Asian countries have done.
Dec 10th, 2010 - 05:51 am - Link - Report abuse 0Oh really, it sounds all good, but now they have problems with “Inflation” rising and rising. They know pegging their currency to the dollar (the dollar is being manipulated to the bottom with the same believe that you can inflate yourself out with exporting your products with a cheap currency..false) won't last long, because it can't... devaluing your currency is a race to the bottom.
I understand that TAX reform won't happen overnight, but that is the best solution and not only in Brazil, but world wide. Countries need to rethink their tax system because all those expensive welfare systems are unsustainable in the long term (you can see now what's happening in Europe). I don't see how producers in Brazil can be against tax reform, but let's see what will happen. I'm willing to bet that she will get it done, she seems to me like BEAR who gets things done.
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