- As of 2021, the value of Brazil-Africa trade was $7.4 billion, being 56 percent drop from $17 billion in 2011.
- Brazil’s energy giant Petrobas left Africa in 2020, selling off its subsidiary, Petrobas and Gas BV.
- President Lula: “Brazil would not be what it is today without the participation of millions of Africans”.
The Brazilian Trade and Investment Promotion Agency (ApexBrasil) has mapped out potential investment and trade opportunities across Africa, a pointer to a new era of economic relations between the two regions that literally sit on opposite sides of the south Atlantic Ocean.
The move is part of the organ’s broader efforts to promote Brazilian products and services abroad and attract foreign investments to strategic sectors.
Historically, it is only fair that Brazil increases its economic and bilateral relations with Africa, a continent where over half of her population trace their origin.
After a recent major drop in Brazil-Africa bilateral trade under former president Jair Bolsonaro, Brazil is now looking to rekindle its economic relations with Africa.
Notably as of 2021, the value of trade between Brazil and Africa was a mere $7.4 billion, being 56 percent drop from the heights of over $17 billion in 2011.
Large investors such as Brazil’s Petrobas left the continent in 2020, selling off its African subsidiary, Petrobas and Gas BV. The following year saw another major investor, Vale, which has stakes in Mozambique’s coal sector, exit Africa. Vale’s exit from Africa marked the end of Brazil’s biggest investment on the continent.
Brazil-Africa relations and the BRICS agenda
“As a matter of fact, amongst the BRICS countries, Brazil has the least amount of trade with Africa,” notes IOL’s writer David Monyae.
Things were different under Luiz Inácio Lula da Silva alias Lula first eight years in power 2003-2010. During this time Brazil-Africa trade grew from just under $4 billion in 2003 to over $17 billion in 2011.
And now with President Lula back in office, these good old days may be returning evident in the announced Brazil-Africa investment and trade plan.
“In Lula, Africa will have a reliable ally and partner especially when it comes to the reform of global institutions such as the United Nations Security Council (UNSC), the Bretton Woods Institutions and the World Trade Organisation (WTO),” Monyae notes.
Indeed, Africa welcomes the return of President Lula to Brazil’s top office and both parties will do well to recall his words: “Brazil would not be what it is today without the participation of millions of Africans, who helped build our country.”
David Monyae of IOL adds: “the South American country is the biggest host of people of African heritage outside of Africa.”
To date, Brazil is home to over 109 million people of African descent. Brazil and Africa share the dark history of slavery with over five million African slaves having been shipped to South American in the 17th century.
Over the years, Brazil has transformed from slave destination to a strong economy and part of the BRICS.
The BRICS, that is, Brazil, China, India, Russia and South Africa are among the world’s fastest-growing economies. The BRICS, with Brazil well at the helm, is doing so well that Goldman Sachs, who coined the acronym, project “the global economy will be dominated by the four BRIC economies by 2050.”
Sustainability and re-industrialisation
To meet its core goal of attracting investment and trade, ApexBrasil carries out various trade promotion initiatives. It is planning to hold the sixth Brasil Investment Forum 2023 (BIF 23). The event will attract foreign investment and is conducted in partnership with the Federal Government and the Inter-American Development Bank (IDB).
Due to be held in capital São Paulo later this year, BIF23 will highlight Brazil’s investment opportunities and its improved and tailored business environment for Foreign Direct Investment (FDI).
“The objective this year is to present the new government’s proposals, especially those focused on sustainability and re-industrialisation,” ApexBrasil says.
It will feature several panels and speeches delivered by ‘personalities of great national and international expression, and a novelty.’
Round table discussions with the government authorities of the 27 Brazilian states will provide investors with a deep understanding of issues specific to each of Brazil’s investment locations aimed at promoting Brazilian products and services abroad, such as prospective and trade missions, business rounds, support to the participation of Brazilian companies in major international fairs, visits of foreign buyers and opinion makers to learn about the Brazilian productive structure, among other business platforms that also aim at strengthening the Brazil brand.
Coordinate foreign direct investment
Through BIF 23, Apex-Brasil will coordinate foreign direct investment (FDI) for the development of resources in sectors of strategic relevance to cement the competitiveness of the country’s companies and for national development.
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Apex-Brasil and the Ministry of Foreign Affairs will also capitalise on the amphibious event by hosting an online business roundtable through its digital platform christened My Business Matches.
Participation is expected by major African economies including South Africa and Nigeria. The focus will be on the machinery and equipment sector especially those meant for the agricultural industry.
Notably, the two countries have significantly increased their importation of Brazilian machinery so much that South Africa and Nigeria respectively rank as the first and second top importers of Brazil’s agricultural machinery.
Influence investment decisions
Africa is increasingly industrialising and Brazil has a lot to offer in affordable technology and related equipment. This scope includes agricultural machines and implements, water pumps and motor pumps. It also entails mining machines and equipment, food processing machinery, handling and storage equipment. Further the South American country also trades in refrigeration, ventilation and air conditioning machines. Brazil also has machines and equipment for the pharmaceutical industry in its stable.
“ApexBrasil works in different ways to promote the competitiveness of Brazilian companies in their internationalisation processes,” the event organisers explained.
In its event media brief, ApexBrasil details that its goal is; “promoting the expansion of investments already made and, for potential investors, and by so doing, placing Brazil on the short list of target countries.”
“We look to influence investment decisions by providing strategic information and complete support for site location work including organizing and accompanying company visits to potential investment recipient states.”
