Businesspeople believe in the signing of the Mercosur-Canada agreement

Participants foresee that the treaty will boost business, according to a survey conducted during the 2nd Brazil-Canada Economic Forum

By Silvia Pimentel

A survey carried out during the 2nd Economic Forum of the CCBC (Chamber of Commerce Brazil-Canada) showed that 89% of participants believe that the conclusion of the Free Trade Agreement between Mercosur and Canada will influence their business. Regarding expectations for the signing of the Agreement, more than half of those interviewed (51%) are optimistic about the conclusion of the negotiations. For 38%, the agreement should not come to fruition in the coming years.

The Mercosur-Canada Agreement was one of the topics discussed during the event, held on June 11th in person and online, and was attended by more than 150 people, most of whom were businesspeople with business in Canada and interested in establishing relationships trade with the country, the 10th largest destination for Brazil’s exports.

The importance of its implementation was highlighted by Constanza Negri Biasutti, manager of International Trade and Integration at the National Confederation of Industry (CNI), during the panel “Bilateral Trade: opportunities and challenges”. According to her, this commercial partnership is particularly relevant for Brazilian industry, which has been losing its share of GDP (Gross Domestic Product) and exports more sharply than in other countries.

“Calculations made by the CNI show that access to global exports would jump from a share of 8% to 11% with the finalization of the Mercosur-Canada Agreement”, she informed. Another important survey that highlights the importance of this commercial relationship is that for every R$1 billion exported by Brazil to Canada, 20 thousand jobs are created. “This number does not differ much from the jobs generated when we look at exports to the European Union”, she compared.

In an optimistic view, Constanza emphasized that there is clear interest from the industry and great expectations for negotiations to progress and the agreement to finally come to fruition. “We would like to understand a little more about what the Brazilian private sector, in conjunction with the Canadian private sector, can do to speed up these negotiations and, with that, explore new potential,” she said.

Participants during the 2nd Brazil-Canada Economic Forum promoted by CCBC

Investments and economy

According to the survey, encouraging investments in the Agreement negotiations should be a priority for 66% of those interviewed, behind opening up to agribusiness products with the review of export quotas (17%).

The survey also captured perceptions about the main barriers that hinder the growth of international business. In this case, 39% cited political and economic instability. For 22%, the biggest obstacle is legal uncertainty, followed by the tax burden, highlighted by 17% of respondents.

Regarding expectations regarding the Brazilian economy, 47% of those interviewed envisage positive reactions in the coming months, compared to 37% who responded that they were pessimistic. For 17%, there will be no improvement or worsening.

Present at the event, the economist and former president of Insper, Marcos Lisboa, outlined an overview of the Brazilian economy over the years, historically marked by falls and rises in GDP (Gross Domestic Product). “The private sector is not paying attention to the high volatility of the Brazilian economy and, as a result, looks at investment with a focus on average return and does not take care of tail risk,” he said.