Fact Sheet: The U.S.-Brazil Economic Relationship
STRENGTHENING ECONOMIC TIES CONTRIBUTE TO JOBS AND GROWTH
The United States and Brazil, the two largest economies and the two largest democracies in the Western Hemisphere, share one of the most important trade and economic relationships in the world. Brazil is our 10th largest trading partner. U.S. goods and services exports to Brazil in 2010 are estimated to be more than $50 billion, which will support more than 250,000 jobs. U.S. goods and services exports to Brazil are growing twice as fast as overall U.S. goods and services exports.
Brazil is an emerging global player and economic powerhouse. With a 2010 GDP of more than $2 trillion, Brazil is the 7th largest economy in the world and accounts for nearly 60 percent of South America’s total GDP. Brazil’s economy grew by 7.5 percent in 2010 and is anticipated to grow by between 4 and 5 percent in 2011.
As the U.S.-Brazil relationship deepens, we seek to base our cooperation on strong and dynamic private sectors, a commitment to open and fair trade, and continued economic and energy integration. Strengthening the economic and commercial relationship between the U.S. and Brazil through stronger partnerships on energy (including clean energy, biofuels, and petroleum sectors), infrastructure and development cooperation in third countries will allow both countries to grow and at the same time strengthen the bonds between the U.S. and Latin America.
A Key Trading Partnership
• Two-way trade between the United States and Brazil has doubled in the past decade to more than $80 billion in 2010, and investment and capital flows in both directions. In the past five years, goods and services exports more than doubled, from $18.7 billion in 2004 to $38.8 billion in 2009.
• With 193 million of the world’s consumers, and per-capita income expected to grow at 6 percent a year, Brazil’s demand for goods imports has more than tripled, from $47.2 billion in 2002 to $181.6 billion in 2010.
• Since 2002, U.S. goods exports to Brazil nearly tripled, growing from $12.4 billion in 2002 to $35.4 billion in 2010. In 2010, U.S. goods exports to Brazil were up 35 percent from 2009. Brazil receives more exports from the U.S. than from any other nation, nearly 15 percent of all goods exported to Brazil.
• These exports were made up of goods from high-tech, value-producing industries. In 2010, the largest U.S. goods export category to Brazil was machinery, valued at $7.2 billion. Other top export categories in 2010 included aircraft and parts ($4.4 billion), electric machinery ($4.3 billion), and organic chemicals ($2.0 billion).
• Exports to Brazil benefit businesses and entrepreneurs across the nation. In every year for the past 10 years, exporters in all 50 states and the District of Columbia have reported exports to Brazil. In 2010, two-thirds of U.S. States (34 total) reported goods export shipments in excess of $100 million.
• U.S. services exports to Brazil have also increased. From 2002 to 2009, U.S. services exports to Brazil more than doubled, increasing from $5.1 billion in 2002 to nearly $12.7 billion in 2009. These services included telecommunications services worth $1.5 billion, and communication and information services totaling $350 million.
• Nearly 1,000,000 Brazilians visited the U.S. in 2009, up from 405,000 in 2002, and spent more than $4.5 billion dollars. By 2015, the Department of Commerce projects that Brazil will be the fifth largest source of visitors to the U.S.
• Leading 15 Exporting States to Brazil (in millions of $USD)
Winning the Future Through Investment
Businesses and workers in the U.S. and Brazil alike are reaping the benefits of a stronger economic relationship through trade and investment. Brazilian companies have opened factories in the U.S., creating American jobs. At the same time, American firms are exporting clean technology that supports green growth and serves millions of Brazilians.
• There was $57 billion in U.S. foreign direct investment in Brazil at the end of 2009.
• Brazilian firms have made substantial investments in the U.S. worth billions of dollars during the past decade. Between 2003 and 2010, 47 projects were announced with a total capital investment of $2.5 billion dollars. Completed, these projects could create 4,806 new jobs, in a cross-section of industries ranging from information technology to steel making.
• U.S. subsidiaries of Brazil-owned firms employed 42,200 people in the United States as of 2008.
U.S.-Brazilian Business Creating Jobs and Economic Growth
Across the United States, small and large businesses are creating jobs through commerce with Brazil. A few recent examples include:
• WindStream (New Albany, IN) closed a $10+ million deal with Wind Force Energia, a Brazilian Clean Tech distributor, for 30,000 wind turbine units. WindStream will begin the delivery of these units at the end of this month and continue for the next three years. The product will be used in Brazil in both on-grid and off-grid solutions for urban and rural applications. This deal will result in 150 new jobs in Indiana.
• Capstone Turbine (Chatsworth, CA), a manufacturer of clean technology micro-turbine energy systems with 200 employees, recently completed work on a $2 million contract with Brazilian Fluxo Servicios de Petroleo for micro-turbine systems. The turbines, manufactured in California, have been shipped to Copasa, Brazil where they produce clean energy from methane bio-gas as a wastewater treatment facility that serves millions of Brazilian residents.
• Rhino Assembly Corporation (Charlotte, NC), a small business with 19 employees, is a supplier and repairer of aerospace and automotive assembly tools. While attending Trade Winds Forum Brazil in Sao Paolo last year, the company developed a relationship with ASA Brazil, a Brazilian tool and equipment distributor, which has resulted in over $615,000 in sales over the past 12 months and the hiring of new employees in North Carolina.
• Sikorsky Aircraft (Stratford, CT) has sold hundreds of helicopters over the past 35 years to Brazilian buyers. The Brazilian Government recently purchased four Sikorsky S-70B SEAHAWK helicopters, valued at $165 million, and approved funding for two additional S-70B aircraft. Petrobras of Brazil purchased eight S-92 heavy-lift helicopters (total value $200 million), and four S-76 medium-lift helicopters ($50 million). Sikorsky will deliver a ninth S-92 heavy-lift helicopter to support Petrobras later this year. These helicopter orders from Brazil help sustain a large, skilled workforce at Sikorsky’s production facilities in Stratford, CT; Troy, AL; and Coatesville, PA.
Partners in the Global Economic Community
The United States has worked continuously to deepen its ties with Brazil, and Brazil’s ties with the global economic community.
• The U.S. has successfully pushed for major emerging economies, such as Brazil, to play a greater role in global economic affairs, and advocated strongly for the G-20 to become the premier forum for global economic and financial cooperation.
• The U.S. moved aggressively to enhance the role of critical emerging market countries such as Brazil in the governance of the IMF and World Bank.
• Brazil has moved from being a foreign aid recipient and IMF borrower to becoming a foreign aid donor, and is now the 10th largest IMF shareholder.
• The United States and Brazil are cooperating on a number of projects ranging from technical assistance to other Latin American countries and Africa in areas such as food security, sustainable biofuels and clean energy development.