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Brazil Uses Trading Companies to Boost Exports

Natural cosmetics from Brazil Brazil's Export and Investment Promotion Agency (Apex) launched a new project to encourage business through trading companies. The aim is to increase the export volume of small- and medium-sized companies by means of foreign trade companies.

"We noticed that a large number of small and medium companies that participated in our events did not manage to maintain their exports, mostly due to lack of knowledge of the foreign market," said the manager of the project at Apex, Maurí­cio Manfré.

According to him, the project's objective is to combine quality products manufactured by the industry and good services offered by the trading companies, providing importers with a full package.

Initially, the agency is going to promote, in Brazil, business roundtables among industries and foreign trade companies, with support from commercial associations. "Thus, manufacturers will get acquainted with this mode of indirect export," stated Manfré.

Later on, trading companies are going to be invited to participate in international events, such as trade fairs, missions and business roundtables, in order to offer the products of small- and medium-sized industries.

According to Manfré, the actions should follow the model of the mission to North Africa that was promoted in the first half of 2007 by the Arab Brazilian Chamber of Commerce and the Apex. During the trip, representatives of companies in various sectors engaged in seminars and previously scheduled business meetings with companies from Morocco, Tunisia and Egypt.

At first, the segments regarded as most promising are those of foodstuffs, products for households and construction, clothing, cosmetics, cleaning material and capital goods. "In this type of event (multi-sector) trading companies end up fairing better, because they have a much broader range of products to offer," stated Manfré.

Five markets were chosen as priorities for the project's actions: Angola, China, Singapore, the United Arab Emirates and Mexico. These countries are regarded as gateways into their respective regions.

"Our market intelligence has determined that these markets present the highest growth rates for imports and the greatest number of business opportunities for Brazil," said Manfré. "Furthermore, those are countries where the presence of intermediaries, such as trading companies, is not considered bad. On the contrary, it is well-regarded" he asserted.

According to the manager, approximately 150 foreign trade companies have already contacted the agency showing interest in the program. The Foreign Trade Studies Center Foundation (Funcex) is surveying the trading companies, a process that should be concluded by late May.

"We need this survey because we possess knowledge about the industries, but not about the trading companies. The role of the Funcex will be to provide us with a profile of those companies," he declared.

The action will be turned to companies in the states of São Paulo (SE), Rio de Janeiro (SE), Minas Gerais (SE), Paraná (S), Rio Grande do Sul (S) and Espí­rito Santo (SE). Manfré believes that from 20 to 35 companies should go on the missions.

The first mission should take place as early as August, to Angola, when a fair should be held in the country. The budget for the project is forecasted to be between 4 million reais (US$ 2.3 million) and 5 million reais (US$ 3 million).

Trading companies interested in the project should send an email to fcorreia@funcex.com.br requesting password to enter the foundation Website and fill out a registration form at www.funcex.com.br/apexquest_1.asp .

Anba – www.anba.com.br

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  • Show Comments (3)

  • João da Silva

    Ch.c
    [quote]On top of what the arguments you mentioned, you failed to underline the interests rates charged to small and medium companies ! [/quote]

    Nope. I expected you to supplement my arguments further with your words of wisdom 😮

    btw, this article irritated me, as I have seen this movie many times before.All lip service and no concrete actions. 🙁

  • ch.c.

    To Joao !
    Are you tellling that the small and medium Brazilian companies have in fact…..declining exports ?
    Hmmmm !

    😀 😉

    On top of what the arguments you mentioned, you failed to underline the interests rates charged to small and medium companies !

    Simply by far far far far the World HIGHEST borrowing rates….after inflation !
    Because when an entreprenuer must borrow at 30 to 50 % rates…when inflation is at around
    4 to 5 %……business become nearly impossible on an international basis for exports…..due to their respective foreign competitors being able to borrow a much lower rates.

    And the declining US$ is not a factor. Look at the currency of my country. The US$ is at an all time low, not only a 8 years low as against the BRL.
    The US$ fell by 80 % against my currency….in around 30 years.
    And Your currency fell by more than 99 % against the US$……in the last 30 years…even at today rate.
    Your currency should still appreciate against the US$ by around 60 % JUST to reach the level of 1995 !!!!! My currency is already 10 % higher that the previous 1995 high against the US$.

    This doesnt avoid my country with a population of 7,5 millions capita to export AS MUCH as your country with s population of 190 millions capita.

    The difference is that we dont need to produce BULKY cheap commodities such as over 500 millions tons of sugarcane, 120 millions tons of grains, tens of millions tons of iron ore…etc etc which by defintion of volume is very expensive to transport.
    Even more so…..in a country with only 10 % paved roads and within those….50 % with bad or no maintenance.
    A few pallets of Rolex watches are worth far more than a large cargo ship of iron ore, grains,soyameals, sugar, ethanol or just name it. And we can ship them….by plane !!!!!

    That is the difference between a developed country…..and a boom and bust country.

    On a per capita basis, we export/import 25 times MORE than you do.
    And we dont even have a sea access. 😀 😉

  • João da Silva

    [quote]”We noticed that a large number of small and medium companies that participated in our events did not manage to maintain their exports, mostly due to lack of knowledge of the foreign market,” said the manager of the project at Apex, MaurÀƒ­cio ManfrÀƒ©.[/quote]

    Not true, Dr.Mauricio. Small and medium companies can not take”manage to maintain their exports” due to a) Declining exchange rate b) too much bureaucracy at all levels including in the government department you work for c) too many taxes d) constant strikes by the RF.

    Oh, I did not even mention about the constant union interference and our outdated labor laws.

    [quote]The first mission should take place as early as August, to Angola, when a fair should be held in the country. The budget for the project is forecasted to be between 4 million reais (US$ 2.3 million) and 5 million reais (US$ 3 million).[/quote]

    I wish the “first mission” to Angola a safe trip back and forth and all the best.

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