Port of Suape to be Argentina’s logistics hub for Brazil’s Northeast

On March 1, a memorandum of cooperation was signed (“MOC HUB Logístico”) between Tecon-Suape and the Argentine Agency for Investment and International Trade, which places the Port of Suape as the official port in the flow of goods that originate in – or are shipped to –  the northeast of Brazil. With this agreement, Pernambuco will directly absorb all the Argentine cargo bound for the northeastern region, collecting the nationalization taxes. Currently, this imported volume enters in the south and reaches the region via highways. In addition to reducing logistical costs by using maritime transport to access the northeastern market, Argentine companies will have access to reduced tariffs and tax incentives from the state government.

The Economic Development Secretary, Geraldo Julio, who led the state government’s meeting with the Argentine government, highlighted the mutual gains of this new commercial relationship. “The Port of Suape has the profile of being a regional pole in the movement of cargo to the Northeast and needed this boost to really take on the position of a warehouse in international commercial relations. We began to increase cargo handling in our port by centralizing the entrance and exit to the northeast, with the added bonus of collecting the nationalization taxes, which were previously retained in the south, even if the consumption was local. All this volume will now begin to enter directly through Suape”, he highlighted.

Another strong point is how the business sector in Pernambuco and the northeast can take advantage of this new commercial relationship. “The memorandum connects us directly to a broader market, with enormous potential for commercial growth. This also enhances the items on the list of attractions in Pernambuco when it comes to attracting new investments here because it expands the possibilities for entrepreneurs who choose Pernambuco to make investments”, reinforced Geraldo Julio.

In relation to Argentina, the agreement to make Suape Brazil’s hub in the northeast allows it to directly reach a region of 57 million inhabitants and a GDP of US $ 212 billion (in 2020), thus avoiding the intermediation of importers from the south of Brazil, which later sell the product already nationalized to the north/northeastern regions. During the meeting, the Argentine Consul General in Recife, Alejandro Funes Lastra, emphasized the understanding by the authorities of the government of Pernambuco.

“The signing initiative is strategic in the integration between both countries and particularly taking into account that the Port of Suape is a Logistics hub in the northeast of Brazil. In addition to the increase in the commercial flow between Argentina and Pernambuco, and also in the region, the memorandum makes it even more favorable with the reduction of logistical costs. With differentiated rates for Argentine products to enter Brazil through the Port of Suape, we broke the dependency on the southern region of Brazil”, he pointed out.

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