The rise of Brazil

Despite the opportunity apparent in Brazil’s population of over 190 million and GDP of US$600 billion, New Zealand’s trade with the country is modest. As an export destination Brazil is not even within New Zealand’s top 25.

Last year New Zealand exports to Brazil were just over $151 million compared to $4.4 billion to the US.

Speakers at the forum, including two New Zealand companies with established networks in Brazil, detailed the opportunities that exist for Kiwi businesses but also had words of caution about the preparation that was needed to enter the market successfully.

New Zealand Trade and Enterprise’s Regional Manager for Brazil, Jessica Acherboim, outlined opportunities in several key areas including agricultural products and services, clean energy (over 80 percent of Brazil’s energy is from renewable sources) environmental technology and construction.

“There is a good fit between market opportunities in Brazil and [industry sectors] where New Zealand has capability.” 

Agriculture is one of the standout areas of opportunity. Brazil has close to 400 million hectares of arable land available, the most in the developed world.

Already the world’s number one exporter of beef and poultry (and coffee, sugar, orange juice, alcohol and tobacco), Brazil is looking for opportunities to increase its productivity.

Federation of Industries of Sao Paulo International Relations Director Mario Marconini said Brazil is already “feeding the world”, but with novel approaches in areas such as livestock management could achieve efficiencies that would equate to an area larger than the entire area devoted to agriculture in the EU. 

Outlining opportunities for New Zealand companies, Marconini said changes in Brazil’s economic and political management had created a country with a stabilised economy, strong productivity gains and high appeal for foreign investment.

Marconini also described the country as having “Braziliance”, a word he coined to capture its liquidity, good reserves, massive domestic demand and low unemployment.

Infrastructure, and other dilemmas

On the downside, however, Marconini said potential investors or trade partners needed to be aware of the challenges Brazil presents in terms of complex tax laws, labour laws and a lack of protection from fluctuations in exchange rates.