A positive surprise halted bad expectations for the Brazilian economy, but there is still no end in sight to the slow growth that has been the three last years. The Gross Domestic Product – the production and income measurement in the country – from 2013 showed modest growth of 2.3% thus becoming the worst three-year period since the late 90s. The impetus came from the last quarter, an improvement of 0.7% in comparison to the previous quarter. Until then, the fear was a negative rate, which would allowed for a recession diagnosis. With the discovery that the economy was not as bad, in December, the expectations for this year are likely to improve, due to a more pleasant start point (Folha).
EU28 exports to Brazil in 2012 amounted to 39.7 billion euro and imports to 37.4 bn. The EU28 registered a continuous deficit in trade in goods with Brazil up to 2011, with a peak in 2007, turning to a surplus of 2.3 bn in 2012. The first nine months of 2013 confirm the most recent trend, with EU28 exports to Brazil continuing to increase, from 29.6 bn euro in the first nine months of 2012 to 30.4 bn in the same period of 2013, while imports continued to fall, from 28.8 bn to 24.9 bn over the same period. As a result, the EU28 surplus in trade of goods with Brazil of 0.8bn in the first nine months of 2012 increased significantly to 5.5 bn in the same period of 2013 (Rotterdam Week).
In a sign that Brazil’s commodity players may be close to tapped out on debt, Brazil’s two largest companies, Petrobras and Vale , said they will be investing less this year (Forbes).
Brazil recorded its largest February trade deficit ever, deepening a trade gap this year that underscores the uncompetitiveness of local industry and a voracious appetite for imports. The commodities powerhouse posted a trade deficit of $2.125 billion in February, the trade ministry said, its second straight monthly shortfall (Reuters).
China has made a significant bet on South America to meet its growing appetite for foreign grain with an agreement to buy a controlling stake in Dutch agricultural trading house Nidera (Rotterdam Week).
A federal court ruled that Germany’s Siemens is prohibited from participating in public auctions and signing government contracts in Brazil for the next five years, company spokesman Alexander Becker said (Bloomberg).
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Drought in the center-south and heavy rains in the center west bread basket states of Brazil have taken a massive toll on the country’s all-important farm sector. According to agribusiness analysts, the country will lose at least R$10 billion (around $4.35 billion) in farm revenues this year because of the odd weather patterns (Forbes).
Trafigura Beheer BV, the world’s second-biggest metals trader, is considering new investments in Brazil after gaining control of an iron-ore port as it expands operations in South America. The Amsterdam-based Trafigura is looking into opportunities mainly in mining projects in the world’s second-largest iron-ore exporter, Mariano Marcondes Ferraz, chief executive officer for Trafigura’s DT Group venture, said in an interview in Rio de Janeiro yesterday. The company may consider buying mines or help current producers to boost their production capacity by financing expansions, he said (Bloomberg).
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Petrobras is set to boost imports as much as 31 percent to supply thermal plants as Brazil’s record drought causes hydro-dams to dry out, Bloomberg reported.
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