Brazil, United States are Powerful and Important Trade Partners
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Published in the Boca Raton Tribun
April 19, 2013
By Carlo Barbieri
Part 2 of a two-part series
In the last installment, this column examined the Brazilian “invasion” of the United States – an economic explosion that focuses on the exchange of products, services and tourism, among other things. This financial two-way street has a dynamic impact on both of these heavily industrialized nations.
The previous column examined tourism along with business and industry investments shared by the two nations. This week, the column discusses U.S.-American trade, its success today and its bright future.
First off, Brazil is a nation of 193 million people that packs some serious economic clout. It is becoming an increasingly important trading partner for the United States. A couple of years ago, President Barack Obama and Secretary of Commerce Gary Locke visited Brasilia, Rio de Janeiro and Sao Paulo – and proposed a number of actions designed to help the U.S.-Brazilian commercial relationship continue to succeed in the coming years.
With a gross domestic product of $2 trillion in 2010, Brazil is the world’s seventh-largest economy. When Obama and Locke toured Brazil, they participated in a series of important meetings on trade and commerce. Obama also met with Dilma Rousseff, Brazil’s new president, who took office in January 2011. Since Rousseff’s election, expectations have been running high for improvements in commercial relations between the United States and Brazil.
In March of 2011, Obama spoke to a packed house at the Teatro Municipal in Rio de Janeiro and made his hopes clear. He said: “Together we can advance our common prosperity.… In a global economy, the United States and Brazil should expand trade—expand investment—so that we create new jobs and new opportunities in both of our nations. And that’s why we’re working to break down barriers to doing business. That’s why we’re building closer relationships between our workers and our entrepreneurs.”
Let’s look at the numbers. U.S. goods and services trade with Brazil totaled $103 billion American dollars in 2011. Exports reached $65 billion, imports totaled $39 billion. America’s has a $26 billion 2011 goods and services trade surplus.
Brazil is now America’s eighth largest trading partner in goods with $75 billion in total imports and exports during 2011. Exports of goods totaled $43 billion; goods imports totaled $32 billion. The U.S. trade surplus with Brazil was $11 billion in 2011.
Trade in services with Brazil (exports and imports) totaled $29 billion in 2011, preliminary data state. Exports of services were $22 billion; imports of services were $7 billion. The U.S. services trade surplus with Brazil was $15 billion in 2011.
U.S. exports of goods to Brazil in 2011 were $42.9 billion, an increase of 21.2 percent ($7.5 billion) from 2010, and up 180 percent from the year 2000. U.S. exports to Brazil accounted for 2.9 percent of total U.S. exports in 2011.
The top export categories in 2011 were: machinery ($7.9 billion), mineral fuels ($6.4 billion), aircraft ($5.4 billion), electrical machinery ($4.6 billion) and plastics ($ 2.1 billion).
U.S. exports of agricultural products to Brazil totaled $800 million in 2011. Major categories included: cotton products ($323 million), dairy products ($40 million), wheat ($30 million) and sugars and sweeteners ($21 million).
U.S. exports of private commercial services (that is, excluding military and government) to Brazil were $21.7 billion in 2011, 28.8 percent ($4.8 billion) more than in 2010 and 248 percent higher than year 2000 levels. Other private services (telecommunications, business, professional and technical and financial services), travel and royalties and license fees accounted for most categories of U.S. services exports to Brazil.
Regarding imports, Brazil was the United States’ 17th largest supplier of goods in 2011. U.S. imports of goods from Brazil totaled $31.7 billion in 2011, an increase of 32.5 percent ($7.8 billion) from 2010 and up 129 percent from 2000. U.S. imports from Brazil accounted for 1.4 percent of total U.S. imports in 2011.
The five largest import categories in 2011 were: mineral fuels and oil (gross), $10.5 billion; iron and steel, $3.5 billion; machinery, $2.3 billion; spices, tea and coffee, $2 billion and special other items (returns), $1.3 billion.
U.S. imports of agricultural products from Brazil totaled $4.1 billion in 2011, making Brazil the fourth largest supplier of ag imports to the United States. Major categories included: coffee (unroasted), $1.9 billion; fruit and vegetable juices, $321 million; tobacco, $278 million and beet and raw cane sugar, $270 million.
U.S. imports of private commercial services (again, excluding military and government) were $6.9 billion in 2011, 25.4 percent ($1.4 billion) over 2010 and up 256 percent from the year 2000 level. Other private services (business, professional and technical services), royalties and licenses and the categories of travel services led U.S. services imports from Brazil.
The U.S. surplus with Brazil was $11.2 billion in 2011, up 2.3 percent ($259 million) from 2010. The United States had a trade surplus in services of $14.8 billion with Brazil in 2011, up 30.4 percent from 2010.
So if, on the one hand, the U.S. is being “invaded” by Brazil, which has brought billions of dollars to America through investments and expenditures of its tourists, the U.S. has “invaded” Brazil with products and services.