Brazil and South Kora trade everything, from food to gullible middle schoolers’ notebooks, and are quickly becoming economic and political partners. In this article, we will cover the history and numbers behind Brazil and South Korea’s commercial relations.
South Korea has a GDP of 1.8 trillion dollars and covers an area of approximately 100.000 square kilometres. On the other half of the world stands the fifth largest country, amounting to two times the GDP of South Korea - Brazil.
First step to establishing relations
Official ties were drawn in 1959 during the Korean Reconstruction under the president Syngman Rhee. Four years later in 1963, Santos Port received the first official Korean immigrants. Yet, the first official visit by any president of either side only took place in 1996, by former president Kim Yong Sam. Brazil reciprocated in 2001, when former president Fernando Henrique Cardoso stayed for a brief three days in Korea.
During the Brazilian military dictatorship negotiations for a deeper cooperation ceased leaving a crippling conjunction behind. However, with the re-democratization, the two countries reignited their relationship and a series of economic and political coalitions followed. One of the most notable examples is the driverless train system operating on Linha 4 in São Paulo’s subways.
Commercial exchange: Brazil and South Korea
These two countries have been officializing and updating negotiations since 1963, which include a pact on tax exemption on specific products, extradition treaties and a nuclear power improvement cooperation. Korea’s investment in Brazil started growing significantly from 1994, jumping further ahead in 1995 at its first signs of economic recovery.
Brazilian Exports to South Korea
Brazil mainly exports natural raw materials such as metal, steel, agricultural products, livestock, petrochemicals, wood, leather and non-ferrous metals. Brazilian exports grew from US$ 466 billion in 2010 to about US$ 560 billion in 2013, recording an 18% expansion within these three years.
Guaraná and açaí, well known Brazilian plants from the deep Amazon and unknown by Koreans until the 2000s, leaped from near zero to lucrative exports during these last few years. Due to health and well-being trends Korean tourists in Brazil look specifically for açaí and guaraná powder due to an elevated cost outside the country (100g of açaí powder costs R$ 15 in Brazil and R$ 58 in South Korea).
Top Five Brazilian exports to South Korea - Value (in USD Million)
Brazil Imports from South Korea
Brazil mainly imports industrialized products such as microchips, microprocessors, printed circuits, vehicle components, engines and plastic. Brazilian imports also grew from US$ 425 billion in 2010 to about US$ 516 billion in 2013, recording a 19% expansion within three years.
Korean investment in Brazilian industries in 2010 were mainly on gathering natural resources, such as farming and fishing, mining, publishing and providing financial services. This totaled about US$ 521 billion.
Top Five Brazilian imports from South Korea - Value (in USD Million)
Brazil and South Korea have been cooperating for their mutual economic growth since 1964. Some of the mechanisms and agreements for cooperation are:
- The Criminal Proceedings Assistance Treaty signed in 2006 which facilitates cooperation between the two countries criminal justice court proceedings.
- The Nuclear Cooperation Agreement in 2005 which avoids the use of nuclear power for purposes other than civil use.
- The General Visa Exemption Agreement signed in 2002 which exempts both Korean and Brazilian citizens from requiring permits when visiting each other within a 90 day period.
- The Extradition Treaty signed in 2002 which facilitates extradition proceedings for both countries.