NEWS | Brazil to Discuss Continuity of Maritime Agreement with Chile

NEWS | Brazil to Discuss Continuity of Maritime Agreement with Chile

By Mariana Branco 
Agência Brasil

NEWS | Brazil to Discuss Continuity of Maritime Agreement with Chile

Image Attribute: The agreement was signed in 1974. The Brazilian Confederation of Industry (CNI) and the Brazilian Confederation of Agriculture and Livestock (CNA) claim that currently it only benefits two companies, both subsidiaries of large German groups.Agencia Brasil/arquivo

The Brazilian government will discuss with entrepreneurs over Brazil’s continuity on a maritime agreement with Chile, which provides that only ships holding Brazilian and Chilean flags can transport cargo between both countries. The meeting will happen on September 12 in Brasília, with exporters, importers, ship owners, technicians from the Foreign Trade Chamber (CAMEX) and possibly representatives from transport regulatory agencies.  

The agreement was signed in 1974. The Brazilian Confederation of Industry (CNI) and the Brazilian Confederation of Agriculture and Livestock (CNA) claim that currently it only benefits two companies: Chilean Hamburg Süd and Brazilian Hapag Lloyd, both subsidiaries of large German groups. 

Diego Bonomo, CNI’s Foreign Trade manager, says that in the 90s, Brazil walked away from most agreements like this that were then in force. According to him, there were only two agreements left. "Two of minor importance, as they are with Romania and Algeria. The other three are with Argentina, Uruguay, and Chile. With Argentina and Uruguay, the exporter can take the land route option. For Chile, the land route is very expensive, and during winter, it is not a viable [option], because passes through the Andes," Bonomo pointed out.  

Both sides arguments  

According to the CNI’s manager, the exclusivity on the route granted for both companies makes transport very expensive for nearly 3,600 exporters and 1,100 Brazilian importers using it. On the exports side, the following sectors are being affected: automotive, chemical, ceramic, food, health and machinery and equipment. For imports, Brazil buys mostly Chilean copper, used in the energy sector.  

Fernando Furlan, executive secretary of the Ministry of Industry, Foreign Trade and Services, said that businessmen from both sides offered arguments for and against the continuity of the agreement, which was renewed last year and is valid until 2020.  

According to him, the ministry has conducted preliminary feasibility studies. The final decision will be made by CAMEX Cabinet Council led by President Michel Temer to frame Brazil’s foreign trade policies. "We are conducting an intensive study to paint all possible scenarios," declared the secretary.   

Translated by Amarílis Anchieta /  Edited by: Graça Adjuto & Olga Bardawil
(c) 2016 Empresa Brasil de Comunicação S/A - EBC /  Creative Commons Atribuição 3.0 Brasil
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