South-Central agreement on the cards
19/05/2008
Brazilian footwear firms may look to set up production facilities in Central America, according to a senior diplomat in El Salvador.
Adelmo García, Brazil's trade representative in El Salvador, has said that the visit of his country's president, Luíz Inacio Lula da Silva, to San Salvador at the end of this month could be the beginning of a trade agreement between the Mercosur trading block in South America (which has Argentina, Brazil, Paraguay and Uruguay as its full members) and Central America Integration System (SICA), whose member countries are El Salvador, Honduras, Nicaragua, Guatemala, Costa Rica y Panama.
Mr García said he believed the possibilities for countries in Central America exporting to Brazil were limited. “Too often, we already produce the same things,” he told local media in the build up to President Lula’s visit, “but we do need aluminium, machinery and electrical appliances.”
He said there was a clear trade imbalance. For example, Brazil exported goods worth $122 million to El Salvador in 2007 but imported products worth only $2 million from the Central American country.
Brazil can help, though, by exporting jobs, he insisted. He mentioned Brazilian textile firm Pettenati, which has a production facility in El Salvador. “This company is investing here and creating jobs and its example shows the way for other Brazilian companies, including in the footwear sector, to come to El Salvador and do the same.”
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