Brazil - Vietnam’s largest trading partner in Latin America

Brazil is a very large and potential market for Vietnamese goods. This market is not too strict and people's tastes are very diverse. 

The General Department of Customs reported that in the first four months of 2023, bilateral trade turnover between Vietnam and Brazil reached US$2.32 billion, down 2.4% over the same period in 2022. Of which, Vietnam’s exports to Brazil reached more than US$855 million, up 14%, while Vietnam’s imports from Brazil reached US$1.4 billion, down 10% over the same period in 2022.

According to the Vietnam Trade Office, Vietnam’s exports to Brazil in the first four months of 2023 included iron and steel, means of transport and spare parts, bags and suitcases, machinery and equipment, textiles, materials of textile, garment and footwear, rubber, seafood, and phones and components.

Meanwhile, Vietnam’s main imported products from Brazil were raw materials and accessories for domestic production, such as corn, machinery, equipment and spare parts, and plastic materials. 

Now, enterprises of the two countries mainly carry out trade activities to meet their production and consumption on the domestic markets. The two countries do not have each other's investors, so the trend of investment cooperation in the two countries is necessary to meet the product supply in each country, according to the trade office.

Meanwhile, the trade activities between Vietnam and Brazil still have many difficulties and challenges. Of which, the geographical distance between the two countries is far, while the transportation is not convenient, so the logistics have not met the import and export needs of the two sides. 

The challenges have also included fierce competition in quality and price from export competitors from China, Thailand, Indonesia, Malaysia, Philippines, and Singapore. 

Additionally, Vietnamese businesses, localities and associations have not been proactive and drastic in expanding markets, including Brazil.

In order to promote exports to Brazil, Ngo Xuan Ty, head of the Vietnam Trade Office in Brazil (concurrently Peru and Bolivia), has suggested that the Ministry of Industry and Trade should propose the Government to promote the development of logistics, helping the businesses reduce transportation costs and facilitate exports. Because the logistics directly affect competition in price and delivery time with export competitors from China, Thailand, Indonesia, Malaysia, the Philippines and Singapore.

At the same time, he has recommended that the ministry proposes the Government to open a flight route connecting Vietnam with Sao Paulo, Brazil, which is the largest trading gateway of South America.

Meanwhile, the businesses, associations and localities should coordinate with the industry and trade ministry to participate in trade promotion programmes such as fairs, exhibitions, trade promotion conferences in Brazil as well as Peru and Bolivia. The Vietnam Trade Office in Brazil is working with partners in Santa Cruz, Bolivia's largest economic centre, to boost exports to Bolivia.

The Peruvian market is an open market with great potential. This is an opportunity to increase the export of Vietnamese goods to this market. Local people are very welcome to import goods with good quality and competitive prices, so Vietnamese businesses should have many trade promotion programmes to introduce their products in Peru, Ty said.

In addition, it is necessary to have a close connection between domestic enterprises to build a community of reputable export businesses for expanding the export market. 

On the other hand, they need to do better in building reputable brands and produce goods with improved quality and competitive prices, he said.

Currently, increased transport and logistics costs have affected export activities. In addition, the export and consumption of goods have suffered negative impacts from many uncertainties in the global market caused by the COVID-19 pandemic, and the conflict between Russia and Ukraine. 

Those factors have affected the production of Vietnam and also the trade activities between Vietnam and other countries, including Brazil.

In 2022, the bilateral trade turnover between Vietnam and Brazil reached US$6.78 billion, up 6.6% compared to 2021.