Trade balance of the chemical sector shows a deficit of US$ 15.5 billion until April
The country’s deficit in the trade balance of chemical products reached US$ 15.5 billion up to April. This represents a decrease of 10.3% compared to the same period in 2022. The amount reached US$ 61.2 billion in the last 12 months, with a reduction of US$ 1.8 billion compared to the record of US$ 63 billion in 2022. Data are from the Brazilian Chemical Industry Association (Abiquim).
For Abiquim’s Director of Economics and Statistics, Fátima Giovanna Coviello Ferreira, it is important to have a long-term State policy that addresses the structural challenges of competitiveness and that makes it possible to attract productive investments anchored in sustainability. It also reinforces the need for immediate and high-impact actions in terms of trade policy in the context of the worsening economic scenario.
“We continue to defend a structuring and innovative agenda, with a medium and long-term industrial development project, but we believe that a pragmatic trade policy that prioritizes the immediate resumption of regular tariff levels is indispensable and urgent, and that systematically combats import surges by reestablishing a safe, loyal business environment that brings benefits to all Brazilians”, he evaluates.
Imports of chemical products had a retreat of 6.6% compared to the same period last year. In the first four months of the year, the sector moved practically 16 million tons. The numbers were concentrated in the retraction of acquisitions of 7.9% in inorganic products and 10.1% in organic products, the most representative groups in terms of acquired quantities.
However, in the first four months of 2023 there were significant increases in imported volumes of thermoplastic resins (29.9%), synthetic fibers (16.1%) and additives for industrial use (2.4%), largely purchased from Asia at prices significantly lower than those practiced in the same period of the previous year.
According to the director of Abiquim, this fact is of great concern, since these import surges occur in strategic groups of chemical products, materializing damage to the trade balance, resulting from the acceleration of the deterioration of competitiveness conditions. This fact is also verified in the increase in the degree of idleness in the use of the installed capacity of national plants, points out the representative.
In monetary terms, until April, there was a decrease of 10.1% in the imported value (from US$ 22.8 billion to US$ 20.5 billion), with products for agribusiness (fertilizers and their intermediaries – US$ 4.8 billion; and agricultural pesticides – US$ 1.7 billion) and pharmaceuticals (US$ 5.8 billion) represented 59.7% of the import basket. On a monthly basis, imports stabilized at US$ 5 billion and exports at US$ 1.1 billion.
The chemical industry and the tax situation
The Brazilian chemical industry has a differentiated tax regime, the Special Regime for the Chemical Industry (Reiq). It was created with the objective of balancing the competitiveness of the Brazilian chemical sector. The president of the Mixed Parliamentary Front for the Competitiveness of the Production Chain of the Chemical, Petrochemical, Plastic and Fine Chemicals Sector, deputy Afonso Motta (PDT-RS), says that maintaining the Reiq is important for the sector to be able to have more conditions to compete with the market.
“The Brazilian chemical industry cannot compete with the global chemical industry, not only with regard to this Reiq issue, but also with regard to competitiveness, showing the difference between the Brazilian industry and the global industry. Therefore, we will continue working to ensure the appreciation of a sector that is responsible for more than 2 million direct and indirect jobs in our country, with a turnover of more than US$ 200 billion per year”, he emphasizes.
In 2022, the National Congress overturned the veto that revoked the maintenance of the Special Regime for the Chemical Industry (Reiq) until 2027. With the overthrow of the veto, the text, which had already been approved by Congress, was reestablished and the sector will have a reduction gradual regime.
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Abiquim believes in a resumption of the chemical industry in 2023
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By Brasil 61
