Brazilian Foreign Traders Call for Less Taxes and Red Tape

Brazilian cargo train The 28th National Foreign Trade Meeting (Enaex), held last month in the city of Rio de Janeiro, raised concerns regarding the international financial crisis, which has already begun to interfere with Brazilian foreign trade and should exert a negative impact on the trade surplus, in 2009, of approximately 10% of the current figure, which is US$ 200 billion.

"One of the issues raised was fear that the effects on the balance of trade might have repercussions in 2010 and 2011, in case effective measures are not immediately adopted by the government and the private sector," said José Augusto de Castro, vice president at the Brazilian Foreign Trade Association (AEB).

"Markets worldwide are retracting and suppliers are growing more and more aggressive. We must identify and reach the buyer," he said.

"The international crisis has interfered on the event's schedule to such an extent that the Ministry of Development has not disclosed its projections for next year's export goal, as it usually does," he asserted.

The Enaex tackled isolated aspects of foreign trade, generating a document that is going to be passed on to the government so as to contribute emergency solutions to problems that hinder the expansion of foreign trade. "To that extent, the working groups emphasized the pressing need for a change in tax policy," said Castro.

Among the measures that were called for during the event is the reduction of the income tax rate on remittances of money to foreign countries, which drives up mandatory expenses such as contracts for technical, lawyer and administrative work, generating tax of up to 40%.

In this edition, the Enaex changed its venue and format. "Before, it was held a the Glória hotel and, as it is an open, free-entrance event, it used to count on the participation of many students. After the event was moved over to the Firjan building, it became more technical and brought the participants closer together, leading to greater integration between the AEB, the government and the entrepreneurial sector," said Castro.

The event was held on November 27 and 28, was attended by 660 companies and 20 organizations with institutional stands.

Among the main points presented in order to solve foreign trade bottlenecks is the creation of a new Law of Foreign Trade, simplifying the administrative procedures, currently comprised of more than 3,000 different bureaucratic actions.

According to information supplied by the AEB press office, the president of the organization, Benedicto Fonseca Moreira, underscored the need for the State Secretariat to ascribe priority to the foreign trade sector.

He also stated that 16 ministries are currently involved in the activity and mentioned concern over the adjustment of foreign trade logistics, which can enable the country to reduce costs for domestic producers with no need for addressing the financial aspects that are making the international financial crisis worse, and ensure greater competitiveness to Brazil.

The railways that have already been privatized, federal roads, ports and accesses to the sea represent yet another issue of bureaucratic simplification and analysis of issues, in which most of the action will be up to the private sector.

"The government needs to reduce red tape in foreign trade activities, and let the private sector operate as it should in a market economy," said Moreira.

The main recommendations include the port administration issue, draining activities, unblocking the railways in the cities, financing for replacing the lorry fleet, encouraging coastwise shipping, focusing on naval construction for the maritime transport sector, among others.

First

The Bank of Brazil launched the world's first three-in-one card, with debit, credit and digital signature, named Ourocard Foreign Trade. "Besides being the world's first, the card reduces costs and provides agility, as it does everything electronically," said Castro.

Anba

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