Brazil opens doors to its official ECA

The Brazilian government has created a national export-import bank, Agência Crédito à Exportação do Brasil (Brexim).

The new ECA is a subsidiary of BNDES and will have access to the development bank’s existing foreign trade division and operation’s portfolio of around US$13bn in operations and US$20bn in prospective projects.

Furthermore, BNDES will also manage the Fundo Garantidor de Comércio Exterior (FGCE), or foreign trade guarantor fund, which will act as a private instrument responsible for offering guarantees to Brexim operations.

Luciano Coutinho, president of BNDES, explains that Brexim may carry out operations that currently face financing difficulties in the market, citing heavy equipment used in the energy and transport sectors as an example.

He adds that Brexim will be used “to provide more ability and competitiveness to commercial operations. There will be no cost increase, as we are using the structure that already exists in the BDNES”.

This news comes after Brazil posted a trade deficit of US$166mn at the start of the year; a significant figure considering the country had a trade surplus of US$2.1bn at the end of 2009.

This leaves Russia as the only one of the BRIC (Brazil, Russia, India and China) countries without an official ECA.