Brazil Trade Surplus Sinks

Official data showed that Brazil’s trade surplus shrank 20% to US$ 46.67 billion last year, as upwardly revised exports in recent months failed to mask a widespread slump in overseas demand for Brazilian goods over the course of 2019.

According to Lucas Ferraz, trade secretary at the Economy Ministry,  the upward revisions to exports in the September-November period are likely to lift gross domestic product growth estimates for the last two quarters, but overall, the shrinking surplus will likely prove to have been a drag on economic growth last year.

The surplus in 2020 could be even smaller, said Mr Ferraz, as strengthening domestic demand lifts overall economic growth to around 2.3% and spurs imports more than exports.

“This growth will be driven by domestic demand, not external demand … which will tend to boost imports more than exports,” Ferraz told reporters in Brasilia, saying that it “should put pressure on the trade balance.” He said the ministry will not release its 2020 estimate until April.

December’s trade surplus was US$5.6 billion, the Economy Ministry said. Exports totaled US$ 18.16 billion in the month and imports were US$12.56 billion. For 2019 as a whole, exports were US$ 224 billion and imports were US$ 177.3 billion, resulting in the surplus of US$ 46.67 billion. In 2018, Latin America’s largest economy posted a trade surplus of US$ 58 billion.