Strengthening economic ties between Brazil and Australia

Article by His Excellency Fernando de Mello Barreto, Brazilian Ambassador to Australia

Eleven months have gone by quickly since I came to Australia as Ambassador of Brazil. During this period – particularly happy for me and my family- I have been able to confirm the potential to increase economic ties between the two countries. At the ceremony of presentation of credentials, I mentioned to the Governor General that the First Fleet stopped in Rio de Janeiro in 1788 and brought from there a number of Brazilian products including rum, seeds and plants, particularly coffee, indigo, cotton, fig and cassava. I asked myself then: if Captain Phillip was able to bring Brazilian products to Australia in 1788, why wouldn’t it be possible to increase trade and investment between the two countries in this day and age of much more advanced technology.
Definitely there is potential for much more business between the two countries. Brazil and Australia are the two largest countries in the Southern Hemisphere. Brazil is presently the 9th largest economy in the world and the major economy in South America. Australia is the major economy in the Pacific region and an important market due to its high GDP per capita. In both countries agriculture is an important sector and, consequently, Canberra and Brasilia share similar concerns regarding the world trade negotiations. Mining is another relevant sector to both economies, as reflected by CVRD’s investments in Australia and BHP Biliton and Rio Tinto’s investments in Brazil.
The geographical distance between Australia and Brazil is a challenge for a trade growth, although not insurmountable. As trade and investments increase, there is more demand for transportation and consequently more opportunities for those in the transport business. The recent increase in the number of Australians going to Brazil as tourists and Brazilian coming to study in Australia is contributing to an increase in the demand for seats in airplanes flying to and from South America. In fact, the majority of the passengers on that route have Brazil as their final destination or the beginning of such trips.
During recent months several companies from both countries have found opportunities in each others markets. Virgin Blue has acquired 20 aircraft from Embraer; Friboi has invested in Australia in meat processing; Nufarm has completed the acquisition of a Brazilian company in the crop protection business; Pacific Hydro has sent executives to Rio Grande do Norte to examine investments in windmills.
There is still much to be learnt about each others economy and opportunities, especially for small and medium size companies. The Australia Brazil Chamber of Commerce - ABCC, under Cristina Talacko’s excellent leadership, is doing its part very well. Ultimately, however, ABCC members are those who are changing business opportunities into business realities.