Commercial Relations: Brazil and Israel
Being a great participant of global trading, the Israeli economy based in exportations caught Brazilian eyes. The country has been interested in the potential and prosperous market that Israeli industry has to offer.
Brazil was one of the first countries to recognize the Israel State in 1949 and, already in 1951, the Delegation of Brazil in Tel Aviv was created, being turned into an embassy in 1958. In the same year, Israel launched its own embassy in Rio de Janeiro.
Brazil and Israel shared a long history of technical, scientific and technological exchanges. Since the 1960s, Israel had contributed to the development of the agriculture with the diffusion of irrigation techniques in the Brazilian semi arid Northeast. During the Military Regime in Brazil, the political relations between both countries had diminished, but cultural exchange flourished even more.
Commercial Balance of Trade
Agribusiness is the main factor of integration in trade relations between Brazil and Israel, according to a study by the Institute of Agricultural Economics (IEA). While Brazil basically exports products related to agriculture and livestock for their partner in the Middle East, Brazil imports products and technology from Israel that are used to reduce costs and increase productivity in the field.
The relationship between the two countries in agribusiness were discussed at the seminar "Brazilian Agribusiness Situation and Challenges" held in São Paulo on 2013 October. The event, organized by the Brazil-Israel Chamber of Industry and Commerce, brought together representatives of the private sector, researchers and industry experts.
Together, the production of Brazilian beef and sugar cane were responsible for 38.8 % of the 291.7 million USD in products shipped to Israel by September of 2013 . The trade balance between Brazil and Israel, however, isn't the most balanced, since Brazil imported 531.9 million USD in the same year – representing a deficit of 240.2 million USD.
| Description | 2008 | 2009 | 2010 | 2011 | 2012 |
| Brazilian Exports variation based on the last year | 398.6 12% | 270.5 -32.1% | 339.5 25.5% | 498.5 46.8% | 376.1 -24.6% |
| Brazilian Imports variation based on the last year | 1,221.3 80.5% | 651.6 -46.7% | 1,012.5 55.4% | 904.5 -10.7% | 1,143.5 26.4% |
| Trade Exchange variation based on the last year | 1,619.9 56.9% | 922.1 -43.1% | 1,352.1 46.6% | 1,403.0 3.8% | 1,519.6 8.3% |
| Trade Balance | -822.8 | -381.1 | -673.0 | -405.9 | -767.5 |
Most products that Brazil is buying from Israel are industrialized – being one of the highlights from the technology of drip irrigation. Netafim, the world leader in the sector, is Israeli and has factories in Ribeirão Preto (São Paulo) and Cabo de Santo Agostinho (Pernambuco), and an office in Campinas (São Paulo). .
To João Carlos de Souza Meirelles, former Secretary of Agriculture of São Paulo, the development of agribusiness in recent years has meant that the industry is no longer considered exclusively rural. According to Meirelles, one of the challenges of Brazilian agribusiness is to increase the added value of their products. If it works with Israel, Brazil will have the possibility to grow together with the partner.
Strenghthening Brazilian-Israeli Relations
In the last couple of years, the political relations became stronger with a series of ministerial and commercial visits from both sides, such as the visit to Israel of the Brazilian Chancellor and Brazilian Ministers of Foreign Affairs, Education and many others. The arrival of the Israeli Chancellor to Brazil for the first time after 20 years in 2009.
All the meetings and visits between Brazil and Israel brought many bilateral agreements in the fields of education, agriculture, health cooperation, scientific, industrial and customs research. Besides the visitations, many other commercial missions were developed between both countries.
Free Trade Zone Agreement
The 2007's Free Trade Zone Agreement between Israel and Mercosur, declared Israel as the first extra-regional partner to set an agreement of this type with the economic bloc. The agreement aims to open the market of goods trade, rules of origin, safekeepings, cooperation in technical and sanitary norms, technological and technical cooperation and customs cooperation. In 2008, the bilateral trade overcame 1.5 million of USD, with Brazil being the largest partner of Israel in Latin America.
Research and Development
The number of Israeli companies in Brazil has grown intensely. This advancement shows the increase in Israel's interest in the Brazilian market. The company Elbit, one of the largest conglomerates in the world of embedded electronics, is expanding its subsidiary in Minas Gerais, the Aeroeletrônica (AEL). The company, which has more than 10,000 employees worldwide, will use its Brazilian subsidiary for the modernization of 70 aircrafts, a service that was previously provided in Israel.
Tourism Aims and Expectations
In the context of tourism, in 2012, 60,000 Brazilians visited the Holy Land of Jerusalém in Israel. The number is 20% higher than it was in 2011. Due to that growth, the Israeli Ministry of Tourism aims to bring 140,000 Brazilians to Israel in 2014.The basic strategies were the expansion of the Representative Office of the Ministry of Tourism in Brazil and the facilitation route between Brazil and Israel, and vice versa, with the Israeli airline El Al beginning its operations in the Brazil.
Education: Students Exchange
Besides the commercial relations, other types of cooperation were also established between Brazil and Israel. One of the programs offered by the Israeli Embassy in Brazil is the Mashav, a program that gives scholarships for many courses in Israel. Thanks to the good relationship between Brazilian and Israeli universities.