By Bernardo Caram
BRASILIA, May 3 (Reuters) - Argentina has offered to
fast-track imports from Brazil if its neighbor adopts a new
credit system that reduces its dependence on the dollar, which
it has in short supply, officials in both governments told
Reuters.
The proposal would cut the processing and payment time for
Brazilian products to 30 days from 180 days at present, reducing
trading risks with a country with high inflation and exchange
rate variations, the sources said.
Argentina's import system SIRA would be modified to be able
to handle operations in the Brazilian currency, said one source.
Payment in reais by Argentine importers would be made
possible through the new financing system designed by the
Brazilian government, though technical aspects have yet to be
defined, the source said.
Brazil offered to help cash-strapped Argentina and support
Brazilian exporters so that they can continue to sell to their
neighbor, the main export market for Brazilian manufactured
goods. The plan was announced during a visit to Brasilia on
Tuesday by Argentine President Alberto Fernandez.
More than 200 Brazilian companies have stopped exporting to
Argentina or are not receiving payments due to the lack of
foreign currency there, Brazil's Finance Minister Fernando
Haddad told reporters.
The economic teams of Brazil and Argentina will meet further
next week in Buenos Aires.
"Why will Argentina benefit? Because it can trade in reais
and that lowers the pressure for dollars on its Central Bank,
and lowers pressure on its international reserves," said the
other source.
The official, who requested anonymity, said one of the
issues in the negotiations was what kind of guarantees Argentina
can give to make the operations viable.
He said a mechanism discussed was an "escrow" account in a
Brazilian bank that would receive guarantees.
Such guarantees could, for example, be Chinese bonds, or
contracts for the future purchase of gas or wheat, assets with
international liquidity which Brazil could access to compensate
losses in the event of non-payment by an Argentine importer.
One idea is for Brazil's development bank BNDES to manage
the financing.
The plan is to facilitate sales by 210 Brazilian businesses
that have had trouble exporting to Argentina, including in the
auto, steel, chemical, home appliances and food industries.
Brazil has been losing ground in its bilateral trade, with
its share of Argentine imports dropping $4 billion dollars from
2014 to 2019, one of the sources said.
China, which has financing mechanisms that assist
exports, took over that lost market share.
On Tuesday, alongside Fernandez, President Luiz Inacio Lula
da Silva said the New Development Bank of the BRICS group of
leading emerging nations could help Argentina by giving
guarantees for Brazilian exports, though that would require
changes in the bank's operating rules.
"We don't even want them to lend money to Argentina. What we
want is for them to give us guarantees, which then greatly
facilitates Brazil's relationship with Argentina," he said.
(Reporting by Bernardo Caram; Additional reporting by Lisandra
Paraguassu; Editing by Richard Chang)
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