Coronavirus affecting Brazil’s foreign trade

Brazilian foreign trade companies are bracing themselves for an increase in coronavirus cases in the country. Physical business meetings, especially involving China and other Asian countries, will be avoided, with business conducted instead via telephone, e-mail or videoconference.

The president of the Brazilian Foreign Trade Association (AEB), José Augusto de Castro, told Agência Brasil that China (the country currently suffering from the largest number of deaths from coronavirus) will undergo a major reshuffle and this will cause a major a blow to Asian nations, especially with regard to new products, “because they are not sold by simply visualizing online”.  Castro said that currently, “as far as possible”, companies are trying to export. “Unfortunately right now the coronavirus is dictating what happens.” It is not enough to simply export or import, he said.

Commodities
Castro explained that a greater supply of products in the international market will put downward pressure on the prices of commodities (agricultural and mineral products sold on the foreign market) and manufactured goods will be affected due to the quantity.”As Brazil does not have a competitive price in manufactured goods, the trend is that it will be affected by to the coronavirus”, he commented.

AEB is projecting a drop in imports because demand from the domestic market is expected to be lower, given a lower growth in the Gross Domestic Product (GDP) – the sum of all goods and services produced in the country. Exports are also expected to fall because this new virus is spread around the world, Castro said.

Castro affirmed that there been no internal disruption to work. “Nobody stopped working because of the virus. The problem is on the outside. ” Castro explained that companies want to buy from China and China cannot deliver. This implies an interruption of trade flows. “This generates a question about what will happen”.Once coronavirus cases are reduced in both Europe and the United States, the president of the AEB assured that Brazilian businessmen would continue to go to these markets, which will remain open. As for China and other Asian countries, Brazilian businessmen will think twice before traveling to these destinations, “unless there is a very sudden change in the scenario that is today”. Companies are adapting as fresh news emerges, he said.

Source: Agência Brasil

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