Brazil’s Minister of Development, Industry and Foreign Trade, Luiz Fernando Furlan, says that the government now estimates Brazilian 2005 exports will reach US$ 108 billion.
Although that will be an increase of 12%, it will be smaller than the increase this year (which was 32%) because export growth is expected to be slower in 2005 for a number of reasons.
Furlan points out that 2004 exports were favored by a spike in prices on international commodities markets, something (he called it a “bonus”) that will not happen in 2005.
The minister said that the path to more exports is diversification – both markets and products. Much groundwork in diversification was done in 2004, but it needs to continue, said Furlan.
In 2004, Brazil increased its exports by 100% to a total of 22 countries. For example, sales to Poland rose 270%, and to Venezuela 142%.
“By diversifying our markets we reduce risks,” said Furlan, adding that he was certain Brazilian exporters would continue to move into new markets making Brazil less vulnerable.
As for the consequences of the weaker dollar, Furlan pointed out that Brazil’s exchange rate floats both ways, “up and down.”
The minister said the government would seek to avoid having an excess of dollars on the domestic market drive the real even higher.
Finally, regarding forecasts for lower farm sector exports in 2005, Furlan said the sector would continue to be an important segment in Brazilian foreign trade.
“We believe that the ethanol (made from sugarcane in Brazil and used as both a fuel and additive), along with the coffee and meat sectors, will remain strong in 2005 and continue to give our exports a boost,” he concluded.
Translation: Allen Bennett