Source: DCI - 13/06/2011

Dilma Rousseff's government decided to “pay back in kind” in the face of decisions made by its trading partners such as Russia, Argentina, the European Union and China. The most effective way, for now, has been the application of non-automatic licenses and anti-dumping measures in favor of the country's industry.

“The government's position regarding the actions of its partners happens at a time when imports are increasing disproportionately and the national industry is being extremely harmed, to the point of becoming an assembler and not a producer of products. The measures are being effective, they are showing the rest of the world that Brazil will no longer be the good guy in trade relations, that we have a bullet in the needle and that we will respond in the same proportion ”, ponders Roberto Segatto, president of the Brazilian Association of Foreign Trade (Abracex).

“Retaliation will not be only with Argentina and Russia. I am betting on the imposition of a reference price on products from China, our main partner today, due to the Chinese exchange rate issue, which does not allow any country to be competitive against the Asian country's industry. In this way, we would stop the gigantic entry of Chinese products and mitigate the embezzlement and losses in the national industry ”, explains Roberto Segatto.

Asked by the DCI about possible retaliation to the contrary, he says that Chinese products are more competitive, but there are other markets that can supply the same products. In contrast, few countries can offer quality raw materials and food to the Chinese like Brazil.

“And even so, our products are being highly sought after by several countries, that is, there is no shortage of buyers today.”

Facing relations in Mercosur, after Brazil informed that it would expand the imposition of non-automatic licenses to several sectors, in addition to the automotive, Argentina decided to tune in and sign an agreement to respect the 60-day deadline for the release of non-automatic licenses. products from both countries, and thus follow the World Trade Organization (WTO) rule. Another commitment was also to ensure that the importation of authorized Brazilian products can be effectively marketed in Argentina, without imposing “last minute” health licenses on imported products.

At the same time, Mdic applied the definitive anti-dumping duty on imports of styrene and butadiene rubber, originating in South Korea, and also, the application of a provisional anti-dumping duty on Brazilian imports of supercalendered paper from France, Italy and Hungary.

Another imposition was made by the Plateau to increase the tone of the protests against the Russian measure to suspend the purchase of meat from 85 Brazilian slaughterhouses. In a show of discomfort, the secretary general of the Foreign Ministry, Ruy Nunes Pinto Nogueira, summoned the Russian ambassador to Brazil, Sergey Polosi Akopov, to explain the reasons for the embargo and applied a surcharge on the metallic magnesium produced by the Russians and imported by Brazil. Last year, Brazil imported about US $ 15 million of this magnesium.

In diplomatic circles, calls from foreign ambassadors are considered a clear gesture of dissatisfaction. The Russian ambassador agreed that the measure was exaggerated.

In addition to the Competitiveness Development Policy (PDC), which should be released in the next 30 days. "It will be an injection into the vitamin vein for the industry, which has been suffering from the valued exchange rate and the unfair competition from imports," argued the Minister of Development, Industry and Foreign Trade (Mdic), Fernando Pimentel. “With these measures, Brazil can make a big leap in exports and increase the competitiveness of products, with a renewed industry, which will save on production expenses as on energy, since the new machines are economical”, points out Segatto.

"With the cheap dollar and the tax relief, we have the opportunity to make a huge modernization of the industrial park", said Pimentel.

According to Mdic technicians, the creation of the “investment drawback” was also defined. This mechanism will allow machine manufacturers to purchase inputs without paying PIS / Cofins. It is different from the previous measure, which benefits the equipment buyer.

The impact of the measure, however, will only be significant for companies that export machinery, which accumulate PIS / Cofins credit.

“The problem is that few companies are exporting because of the strong real”, points out Segatto, who adds “this measure is almost the same as the Deciex [model that existed 10 years ago], in which, the entrepreneurs imported the equipment totally exempt from taxes and they had more than 5 years to export the value. This will be very positive ”, reports Segatto.