Brazil wants its trade relations with Russia to strengthen and continue past the end of the Moscow-imposed ban on agricultural imports from Western countries that hit it with sanctions, Brazil’s Minister of Agriculture, Livestock and Supply Katia Abreu told Sputnik Brazil.
The European Union, the United States and their allies imposed several rounds of sanctions against Russia for its alleged involvement in the Ukrainian crisis in 2014. Moscow has repeatedly denied those claims, and, in August 2014, responded by imposing a year-long ban on certain food imports from the countries that imposed the economic restrictions.
In late June, Russian President Vladimir Putin signed a decree extending the countermeasures.
Jared Cummans – ETF Database, 1/19/2015
Brazil has long been one of the most alluring emerging market economies, earning itself the “B” in the popular BRIC nation group. Its economy was once bustling and offering handsome growth for investors, but that has screeched to a halt in recent years. What’s worse is that it does not appear the emerging market will get back on track anytime soon.
From 2010 to 2014, EWZ had an average annual return of -9.81%; from 2005 to 2009 that figure was 47.74%, a stark contrast. The poor returns come as GDP continues to disappoint, among other things. 2014 saw a trade deficit of $3.93 billion, the largest since 1998. Exports in 2014 dropped 7% while inflation continues to rise. The hefty costs of hosting the 2014 FIFA World Cup certainly did not do the country any favors. To put it simply, the Brazilian economy is facing a number of headwinds, none of which are quick fixes.
Looking forward to 2015, the outlook is not much better. GDP growth fell from 2.3% in 2013 to 0.15% in 2014, as the economy suffered a sharp slowdown at the end of 2014. Analysts are forecasting GDP growth of 0.5% for this year; while that may be higher than 2014, it is certainly not a number that is going to get the economy back on the right track, as it still lies on the brink of a recession. On top of that, inflation continues to rise, forcing the central bank to raise rates to attempt to keep prices at bay.
Otaviano Canuto – Business Insider, 1/12/2015
According to traditional macro-level measures of trade penetration (share of exports and imports in GDP), Brazil is an unusually closed economy. For Brazil this measure was only 27.6% in 2013 – a figure among the lowest in the world. Notably, Brazil’s trade openness lags far behind its peers among the BRICS countries, all of which reached trade-to-GDP ratios of at least 50% in recent years.
Brazil’s size is often used to explain the country’s relative closedness. As the comparison with other large economies already indicates, this argument does not hold up to close scrutiny. While it is true that large economies tend to exhibit lower percentages of exports and imports to GDP, this feature fails to explain the exceptionally low levels of trade penetration observed in Brazil.
Looking at 2013 data from 176 countries available through the World Bank’s World Development Indicators (WDI) database, the average trade-to-GDP ratio is 96%. Even among the six countries with a larger economy than Brazil, the average is 55%.
Brazil and Uruguay have switched to settling bilateral trade with local currency to stimulate turnover, bypassing the US dollar.
Payments in the Brazilian real and Uruguayan peso started on Monday. The agreement was signed on November 2 by the head of Brazilian Central Bank Alexandro Tombini and his Uruguayan counterpart Alberto Grana. Both countries believe such a move would strengthen trade across Latin America.
“The agreement was the result of long negotiations between the countries belonging to Mercosur [the common market of South American countries – Ed.], as well as the global strategies of BRICS,” RIA quotes Carlos Francisco Teixeira da Silva, Professor of International Relations at the Federal University of Rio de Janeiro.
Moses Talemwa – All Africa, 11/6/2014
The emergence of Brazil, Russia, India, China, and South Africa (BRICS) as a strong economic bloc continues to spur global economic growth. Africa offers immense potential for the bloc with Brazil now ready to come to Uganda.
Moses Talemwa recently met Joao Bosco Monte, the chief executive of the Brazil-Africa Institute, who was in the country to check out investment opportunities of interest to Brazil.
When will Brazil follow in the footsteps of its peers in the BRIC and come to Uganda? Uganda should present itself to Brazil. Brazil is already close to Africa. Our former president Lula Da Silva set the agenda by stating that Africa is a priority. He led a delegation of businessmen to Africa and we have been investing there ever since. We have contacts with mostly Lusophone Africa – Angola, Mozambique, Cape Verde and Guinea Bissau. Now we are looking at other countries.
Steve Forbes – Forbes, 11/24/2014 Print Edition
The result of the presidential election in Latin America’s largest nation has dusted off an old bromide: Brazil has a great future–and always will. This populous, resource-rich, continent-size country seemingly made enormous strides after going through a disastrous financial crisis in the late 1990s. Chronic inflation was halted, and antibusiness regulations were eased. Combined with the global commodities boom of the last decade, these measures sent Brazil’s economy roaring ahead, and by 2010 the country’s GDP ranked seventh in the world. It looked as though Brazil had made the leap to developed status and was, in terms of the size of its economy, ready to surge past such countries as Britain and France.
Then it all screeched to a halt. It turns out much of Brazil’s boom was dependent on high commodity prices. Today Brazil is in recession. Its currency has slumped, and inflation is ominously rising. Foreign direct investment is shrinking, as are business capital expenditures by firms based in Brazil. Corruption is flourishing.
President Dilma Rousseff, who took office as the Brazilian economy turned cold, narrowly squeaked by a pro-free-market candidate to win a second term. The big question is whether she’ll turn away from the statist policies that have long plagued and crippled Brazil’s economy or place her country firmly on the road to the perdition of Argentina and Venezuela, where stagnation, shrinking political freedom, populist demagoguery and corruption are the norm.
Bianca Suyama and Gonzalo Berrón – The Guardian, 10/30/2014
After an election campaign that was more unpredictable and nerve-wracking than Brazil’s popular soap operas, President Dilma Rousseff will lead the country for another four years.
Brazil’s government has defined its foreign policy as “active and prominent”. This is a legacy of former president Luiz Inácio Lula da Silva, who wanted to lead Brazil towards greater autonomy and relevance in the global order. He wanted Brazil to contribute to a more democratic and multipolar world; diversify its partnerships – with particular focus on countries in the global south and the Brics (Brazil, Russia, India, China, South Africa); and promote South American integration.
However, these initiatives were not without their tensions and contradictions. Rousseff appeared to give less priority to foreign policy and some of the achievements of Lula’s administration stagnated under her. What should she focus on now the election is out of the way?