Deficit in the trade balance in chemicals shows a new record of US$ 63.4 billion

Brazilian imports of chemical merchandise reached a complete of US$ 5.4 billion in January 2023. The quantity corresponds to a 7.7% leap in comparison with the identical interval final yr. Nonetheless, the file is a 2.2% drop in comparison with December 2022.

By way of bodily portions, since August 2022, imported volumes have had a downward development every month, and for the primary time since January 2022, month-to-month imports don’t exceed 4 million tons.

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The rise in imported worth is linked to an exterior motion of worth will increase, stimulated by the worldwide power disaster, particularly gasoline, after the warfare between Russia and Ukraine.

Abiquim’s chief government, André Passos Cordeiro, explains that, given this situation, a tariff discount coverage was adopted in a fancy worldwide context and at an especially inopportune financial second. Based on him, this measure meant that imports of thermoplastic resins had a rise of 25.6%, in comparison with July final yr.

“This led to a rise in imports and affected the minimal profitability of firms that produce in Brazil, resulting in the stoppage of whole manufacturing traces and a discount in using capability in Brazil. Our expectation is that the federal government reverses this in time to forestall the disaster within the sector from getting worse and jobs being reduce”, he highlights.

As for exports, which totaled US$ 1.2 billion, stability was verified (-0.3%) compared with January 2022. Nonetheless, there’s an advance of three.9% in comparison with December. Within the first month of this yr, the amount of round 1.2 million tons alerts a 4% leap in comparison with January final yr and 9.9% in comparison with the final month of 2022.

Chemical trade tax standing

The Brazilian chemical trade has a selected tax system, the Particular Regime for the Chemical Trade (Reiq), which was created to compensate for variations within the tax burden between international locations and make the nationwide trade extra aggressive.

“It’s a regime that compensates for the variations in competitiveness, particularly because of the excessive tax burden in Brazil between the chemical trade, which produces right here and the chemical trade that produces, for instance, within the US. In the present day the tax burden of the chemical trade in Brazil it’s near 45% and within the USA, for instance, 20%. So Reiq works to attempt to partially cut back this distance”, explains the manager president of Abiquim.

On the finish of 2022, the Nationwide Congress overrode the veto of then President Jair Bolsonaro to take care of the Reiq till 2027. After the overthrow of the veto, the textual content initially permitted by Congress was reinstated and the sector will see a gradual discount of the regime.

As a definitive answer, the federal deputy Luiz Philippe from Orleans and Bragança (PL-SP) assesses that it’s important {that a} tax reform be permitted, with factors that right distortions that negatively have an effect on the nation’s trade.

“All the industrial sector is burdened by the present tax mannequin. Virtually no nation adopts the mannequin that Brazil has, and this creates a really massive delay within the nation’s growth, particularly in lengthy productive channels. Trade falls into this class. The chemical trade has a number of suppliers and it pays tax to those suppliers and likewise resells with tax and, in lots of circumstances, exporting tax, as a result of we should not have a dependable switch system”, he factors out.