Entrepreneurs gathered in World Trade Organization (WTO) headquarters in Geneve showed concern about the direction of Brazilian trade policy.
# 1 “protected” economy among G-20
According to the International Chamber of Commerce (ICC), most G-20 countries – which gathers both the largest developed and emerging economies – have adopted more protective measures. But an ICC index points Brazil as the most protectionist in the G-20, with more restrictive trade policy than countries such as Argentina, China and Russia.
” Brazil has an important economic growth, but at the same time is a less open market we’re seeing,” said in an interview the vice president of ICC, Harold McGraw III.
For WTO, Brazil is following trade agreements
On the other hand, Pascal Lamy, director of WTO, said the organization is monitoring what happens in global trade but so far, no country has imposed import tariffs beyond what promised to adopt in multilateral agreements.
In fact, Brazil has average import tariff of 10%, but may increase rates to 35% without breaking WTO commitments.
On the other hand, Lamy seems to be more circumspect about the argument that protection in Brazil is necessary because of the currency war. ” The relationship between the level of exchange rate and trade flow is extremely complex,” he said. Source: Assis Moreira | Jornal Valor.
Go further on the topic
FT blog (Sept 16, 2011) on the recent 30-point increase in the country’s industrial-product tax on cars on account of the Brazilian currency depreciation.
Insurers of Europe (Jan 13, 2012) highlights the danger of Brazilian protectionism.
Understanding Brazilian trade policy recent history check Eliana Cardoso’s (professor of FGV) article. (Mar 28, 2009).
Also Joe’s post about The Economist on Dilma Presidency