World Footwear

Trade

Brazil projects a negative year

May 18, 2013 Brazil
Brazil projects a negative year
According to Abicalçados (Brazilian Association of Footwear Industries) Brazilian exports are decreasing. The association found, using data from the Ministry of Development, Industry and Foreign Trade, that exports fell 13.5% in March, compared to the same period last year.As Heitor Klein - Chief Executive of Abicalçados - explained the reduction of exports is the result of a combination of two factors: the crisis of international markets and the appreciation of the Brazilian currency against the dollar. This makes domestic production more expensive than the products of other countries. "Decreasing the competitiveness and profits."Despite this decline in exports, the production was not affected. The federal government decided to implement some measures to reduce some taxes to national production.The decrease in the average export price of shoes to $ 8.4 USD (previously $9.04 USD) was driven by a reduce in exporting costs. According to Klein: "The product is the same, the quality is the same. Also, we had a small recovery in the dollar against the real.”Despite the favorable economic scenario in U.S.A., the main destination of Brazilian footwear, Chief Executive of Abicalçados do not believe that Brazil fully recovers. "In 2012 we had a surplus in the trade balance, about $ 440 million. But if Chinese exports continue to grow, it is possible that at the end of this year, we have a balanced scale. No positive balance", he says.In 2012, Brazil was the 3rd largest producer of footwear in the world but only the 11th in exports due to the large national market.

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