End of access to EU scheme of preferences affects US$5 billion worth of Brazilian exports

Brazilian financial daily Valor Econômico reports that Brazil’s exit from the European Union’s Generalised Scheme of Preferences (GSP) should raise the import tax on products currently making up US$5 billion of Brazil’s total exports. This amount, a figure estimated by the São Paulo State Federation of Industries (Fiesp), is close to 12% of all the country’s exports to the EU in the last few years.

Loss of competitiveness

Those businessmen that used the GSP for their exports say that there could be some loss of competitiveness in the long term unless an FTA is agreed between Mercosur and the EU. The sector responsible for the largest part of the exports was that of industrial machinery, alone worth US$1 billion in exports to the EU. All other products, except for citrus fruits, were industrialised.

Exit a reflex of Brazil’s good performance

Valor states that Brazil’s exit from the GSP might be a reflex of the country’s economic conditions because the country has achieved an upper middle income per capita during three consecutive years, according to World Bank classification.

Fonte/Source: Valor Econômico via Avicultura Industrial