Industry: Brazil-Israel Cooperation Opportunitieswink.globes.co.il/docs/Tatiana Portp-brazil-israel.pdf · Opportunities Brazilian Amazon biodiversity is an asset of sustainable opportunities

Industry: Brazil-Israel Cooperation Opportunities

National Confederation of Industry

Brazilian industry: facts and figures

Opportunities in the industrial sector: 2011-2015

Mercosur-Israel FTA: main features

Brazil-Israel trade: Complementarity or Competition?

New opportunities





New opportunities

In contrast with developed countries, Brazil has a strong domestic demand

31 consecutive quarters of growth

Brazilian economy potential

Household consumption

year over year variation (%)

0

1

2

3

4

5

6

7

8

9

10

IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II

2004 2005 2006 2007 2008 2009 2010 2011 Source: IBGE

Brazil has a diversified and competitive industry


28% of GDP 70% of exports

Brazilian GDP

28%

Industry

65%

Services

7%

Agriculture

Brazil has a diversified and competitive industry


•Number one producer of regional jet planes

• 3rd largest footwear producer

• 3rd largest soft drinks producer

• 5th largest rubber producer

• 3th largest pulp producer

• 6th largest automobile producer

• 9th largest steel producer

Technology-intensive industrial exports


36% of Brazilian industrial exports are: • high-technology products (aircraft, pharmaceuticals and IT); and • medium-technology-intensive products (electric and mechanical materials, automobiles and chemicals)





New opportunities

Environmental features

Opportunities

Brazilian Amazon biodiversity is an asset of sustainable opportunities

• The use of its natural resources in a great variety of the industry’s supply chain such as timber, mining cosmetics, perfumes, food and many others...

• Researches resulting in new applications of pharmaceuticals, cosmetics, phytotherapy and nanotechnology

• Ongoing possibilities with the clean Development Mechanisms (CDM/FCCC)

Brazil holds 20% of the world’s biodiversity

Energy

Opportunities

• The share of renewable resource in the global energy matrix is 23%. In Brazil the percentage is 80%

• 85% of the Brazilian installed capacity is derived from hydroelectric power plants. The remaining 15% is derived from thermoelectric plants

The Brazilian hydroelectric potential is 260 thousand Megawatts, 170 thousand of which

are yet to be exploited

Specialization in ethanol

Opportunities

• Largest producer of sugarcane ethanol

• World’s largest exporter • Ethanol fuel consumption has a 50% market share of the gasoline-powered fleet in Brazil

Brazil is focused on creating a global, standardized and free-trade market

Investments by industrial sector for the next four years

Investments 2011-2015

Sector

Estimates in

US$ billion

Oil e gas 221

Foods and beverages 64

Steel 31

Chemistry 24

Automobiles 19

Electronics 17

Pulp and paper 16

Textile 7

Others industrial 183

Manufacturing 583

Mining 65

Total 648





New opportunities

Mercosur-Israel FTA: new opportunities

Mercosur-Israel FTA

•This is the 1st FTA signed by Mercosur outside South America

Relevant preferences for Israeli products in Mercosur markets

•Israel already has FTAs with USA, EU, Canada, Mexico…

• Israel maintained some agricultural goods as exceptions … … but opened immediately its markets for 75% of

the products

Mercosur-Israel FTA: Summary of the offers

Mercosur-Israel FTA

Mercosur Israel - Summary of the offers

December 2007

Baskets Offers

Mercosur Israel

Items Share% Items Share%

Immediate phase out 2.395 a

24,6 6.674 75,7

4 years 927 b

9,5 1.061 12,0

8 years 3.447 c

35,3 136 1,5

10 years 2.606 d

26,7 -

Differentiated regimes 375 3,8 995 10,8

Excluded 326 e

3,3 866 e

9,8

Total 9.750 100,0 8.866 100,0

l

Mercosur-Israel FTA: main commitments

Mercosur-Israel FTA

•The agreement includes commitments for:

• Rules of origin • Safeguards • Technical Cooperation • Cooperation among Customs Authorities

• Open possibilities for deepening the agreement, including: • Services • Investment

Mercosur-Israel : Bilateral Trade is insignificant

Mercosur-Israel Bilateral Trade

Share %

2009 2010

Argentina 0,39 0,33

Brazil 0,24 0,20

Paraguay 0,21 0,77

Uruguay 0,85 1,23

Mercosur 0,29 0,27

Source: ALADI

Share %

2009 2010

Argentina 0,22 0,23

Brazil 0,51 0,56

Paraguay 0,16 0,04

Uruguay 0,13 0,13

Mercosur 0,42 0,46

Source: ALADI

Share of Israel in Mercosur’s Total Exports

Share of Israel in Mercosur’s Total Imports

•Israel’s participation in Mercosur trade flows is insignificant





New opportunities

Brazil-Israel: Bilateral Trade

Bilateral Trade

Trade Balance

Brazil has been accumulating deficits, but Brazilian exports to Israel are growing fast

•Year •Exports •?% •Share% •Imports •?% •Share% •Trade Balance

•2006 •272.531.387 •3,64 •0,20 •473.742.016 •1,12 •0,52 •-201.210.629

•2007 •355.751.168 •30,54 •0,22 •676.636.578 •42,83 •0,56 •-320.885.410

•2008 •398.566.381 •12,04 •0,2 •1.221.318.874 •80,5 •0,71 •-822.752.493

•2009 •270.502.995 •-32,13 •0,18 •651.555.019 •-46,65 •0,51 •-381.052.024

•2010 •339.539.054 •25,52 •0,17 •1.012.635.045 •55,42 •0,56 •-673.095.991

•Jan-Oct •Jan-Oct

•2010 •266.388.649 •- •- •825.215.195 •- •- •-558.826.546

•2011 •438.588.880 •64,64 •0,21 •763.214.425 •-7,52 •0,41 •-324.625.545

•Source: MDIC

•US$ FOB

Bilateral Trade

Brazilian Exports to the World and to Israel Selected Products

2010

10 main products exported by Brazil to Israel

US$ mil FOB

•Food products respond for 62% of Brazilian exports to Israel •There are few manufactured goods in the list of Brazilian exports to the country

•NCM (SH2007) •Description •World •Part.% •Israel •Part.%

•02023000 •Bovine cuts boneless, frozen •3.368.560 •1,7 •102.181 •30,1

•17011100 •Raw sugar, cane •9.306.851 •4,6 •45.812 •13,5

•17019900 •Beet sugar, others and chemically pure sucrose in solid form •3.454.832 •1,7 •27.455 •8,1

•09011110 •Coffee, not roasted, not decaffeinated •5.181.628 •2,6 •16.521 •4,9

•10059010 •Maize •2.122.167 •1,1 •9.992 •2,9

•44092900 •Wood, inc strips and friezes •350.132 •0,2 •9.371 •2,8

•12010090 •Soya beans •11.035.210 •5,5 •8.914 •2,6

•74111010 •Copper tubes and pipes •26.442 •0,0 •8.554 •2,5

•29051996 •Saturated monohydric alcohol •10.493 •0,0 •6.468 •1,9

•39012029 •Polietilene having a sp.gr. Of 0,94/more, primary forms •460.072 •0,2 •6.246 •1,8

•Subtotal •35.316.387 •17,5 •241.514 •71,1

•Total •201.915.285 •100,0 •339.539 •100,0

•Source: Aliceweb/MDIC e Trademap

Bilateral Trade

Brazil Imports to the World and to Israel - Selected Products

2010

10 main products exported by Israel to Brazil

US$ mil FOB

•Brazil accounts for 1,6% of Israel’s total exports •Fertilizers account for more than 65% of Israel’s exports to Brazil •Hospital devices, pharmaceuticals, and other high value added products are also present

•NCM (SH2007) •Description •World •Part.% •Israel •Part.%

•31042090 •Potassium chloride for use as fertiliser •2.203.793 •1,2 •337.238 •33,3

•31031030 •Superphosphates, more than 45%of phosphorus pentoxide •330.877 •0,2 •96.738 •9,6

•31031010 •Superphosphates, not more than 22% of phosphorus pentoxide •59.107 •0,0 •38.035 •3,8

•30049019 •Medicaments •168.847 •0,1 •28.638 •2,8

•27101931 •Petroleum, mineral oils, medium oils and preparations •544.790 •0,3 •25.585 •2,5

•88033000 •Parts of aeroplanes and helicopters •1.113.053 •0,6 •18.562 •1,8

•82090011 •Plates, sticks, tips and the like for tools, unmounted •89.604 •0,0 •18.385 •1,8

•30049039 •Others medicaments •133.579 •0,1 •17.408 •1,7

•29309035 •Organo-sulphur compounds •39.959 •0,0 •15.493 •1,5

•90142090 •Others instruments for aeronautical and space navigation •78.727 •0,0 •14.378 •1,4

•Subtotal •4.762.336 •2,6 •610.460 •60,3

•Total •181.760.737 •100,0 •1.012.547 •100,0

•Source: Aliceweb/MDIC e Trademap

Brazil-Israel Trade and Investment Opportunities

Opportunities

•Israeli exports to Brazil reflect its comparative advantages: • Minerals and manufactures intensive in R&D

•Brazilian exports to Israel do not reflect properly the country’s comparative advantages:

• Manufactured goods are under represented • There is a vast set of manufactured goods exported by Brazil

and imported by Israel not included in the bilateral trade

• Brazil and Israel compete in many sectors, but there are also complementarities





New opportunities

Brazil-Israel Trade and Investment Opportunities

Opportunities

• Brazil and Israel compete in many products, but there area opportunities to explore intra-industry trade (pharmaceuticals, furniture, jewelry, machinery, among other)

•Opportunities for cooperation in R&D intensive sectors

• New Technological Park in Rio de Janeiro (Energy, Oil and Gas) • EMBRAPA (agriculture research state company) • Pharmaceuticals, hospital’s devices • Green products (Rio + 20 Agenda)

• Opportunities to expand reciprocal FDI flows

• Stock of FDI from Israel in Brazil amounts US$ 76 million • Stock of FDI from Brazil in Israel is almost zero

Documents

Industry: Brazil-Israel Cooperation Opportunitieswink.globes.co.il/docs/Tatiana Portp-brazil-israel.pdf · Opportunities Brazilian Amazon biodiversity is an asset of sustainable opportunities