Brazil Retains Position as Vietnam's Largest Trading Partner in Latin America
|Textiles are one of the products exported to Brazil that increased in the first 4 months of 2023|
According to the General Department of Customs, in the first 4 months of 2023, two-way trade turnover between Vietnam and Brazil reached US$2.32 billion, down 2.4% over the same period in 2022. Vietnam's exports to Brazil reached more than US$855 million, up 14%, Vietnam's imports from Brazil reached US$1.4 billion, down 10% over the same period in 2022.
Vietnam's export products to Brazil in the first 4 months of 2023 increased in a number of items, such as textiles (14%), machinery and equipment (25%), bags, and suitcases (27%), means of transport and spare parts (79%), iron and steel of all kinds increased sharply (345%), other common metals and products (107%), fibers and textile fibers (12%).
Some products tended to decrease such as seafood (-33%), rubber (-41%), textile and garment materials, footwear (-48%), phones, and components (-13%).
Currently, due to increased transportation and logistics costs, export activities have been affected. Besides, the market still has uncertainties caused by the Covid-19 pandemic, especially the situation of Russia-Ukraine, which had a negative impact on exports and consumption of goods. This affected the production and exports of Vietnam and the import and export activities between Vietnam and countries including Brazil.
In the opposite direction, Vietnam's main imported products from Brazil decreased slightly in the first 4 months of 2023, because Vietnam mainly needed to import raw materials and accessories for domestic production to meet domestic demand and production for export.
However, exports decreased, so the demand for raw materials for production decreased.
However, the number of imported items still increased for production needs, specifically corn (up 333%), plastic materials (up 34%), machinery, equipment, and spare parts (up 119%). The reason is to meet the high demand for raw materials and accessories for the processing industry, to meet the production demand for the domestic market and export to other markets.
Brazil is Vietnam's largest trading partner in Latin America and is in the top 3 of Vietnam's largest markets in the Americas, just behind the United States. The total two-way trade turnover between Vietnam and Brazil in 2021 reached US$6.36 billion, up 34% compared to 2020.
Vietnam's exports to Brazil reached US$2.26 billion, up 24%, and Vietnam's imports from Brazil reached US$4.09 billion, up 41% compared to 2020.
Currently, enterprises of the two countries mainly carry out trade, import, and export activities to meet the production needs and domestic market for both sides. Investment cooperation in the two countries is necessary to better meet the supply of products in each market.
Brazil is a large and potential market for Vietnamese goods. The market is not too strict and people's tastes are diverse. Many Vietnamese products can be found in this crowded market.
Besides the advantages, import and export trade between Vietnam and Brazil still has many difficulties and challenges. The two countries are geographically distant. The means of transportation are not convenient to connect the people of the two countries, as well as the logistics that have not met the import and export needs of the two sides.
There is fierce competition in terms of quality and price of export competitors from China, Thailand, Indonesia, Malaysia, Philippines, and Singapore. Vietnamese businesses, localities, and associations have not been proactive and drastic in expanding markets, including the Brazilian market.
In order to promote export activities to this market, Ngo Xuan Ty, head of the Vietnamese Trade Office in Brazil, suggested that the Ministry of Industry and Trade propose the Government to promote the logistics sector, improve Vietnam's logistics capacity, help businesses reduce transportation costs.
Regarding businesses, associations and localities should coordinate with the Ministry of Industry and Trade to participate in direct promotion programs such as fairs, exhibitions, and business conferences in Brazil and countries like Peru, Bolivia. Currently, the Vietnam Trade Office in Brazil is working with partners in Santa Cruz, Bolivia's largest economic center, to find ways to boost exports.
“The Peruvian market is an open market with great potential. Local people welcome imported goods with good quality and competitive prices, which is an opportunity to increase exports of Vietnamese goods to this market. Enterprises should have programs to promote and introduce products in Peru," said Ngo Xuan Ty.
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