Egypt’s trade exchange with the Mercosur bloc of South American countries rose 1.9 percent year-on-year to $4.461 billion in 2018, a trade ministry official said on Sunday.
In 2017, trade exchange volume stood at $4.378 billion, said Michael Gamal – head of Bilateral Trade Agreements at Egypt’s Ministry of Trade and Industry.
Gamal attributed to the rise in the trade exchange volume to a 98.2 percent growth in the size of Egyptian exports to the bloc.
Egypt’s exports grew to $326.2 million in 2018 from $164.6 million a year earlier, he added at the Egyptian-Brazilian Business Forum taking place in Cairo.
Meanwhile, imports fell 1.8 percent to $4.135 billion from $4.213 billion.
Brazil captures 75 percent of Egypt-Mercosur total trade exchange volume, the Egyptian official said.
Egypt’s exports to Brazil were nearly $260 million in 2018, while imports stood at $3.088 billion.
“90 percent of Egyptian exports to Brazil are industrial commodities, while 77 percent of imports constitute agricultural and food commodities and products,” Gamal said.
The Mercosur-Egypt agreement made 31 percent of the goods exported from Mercosur duty-free. That rate will be 45 percent in two years’ time, according to data presented by Fernanda Baltazar. Conversely, duties have been lifted on 26 percent of goods shipped from Egypt to the Mercosur, which should go up to 32.2 percent two years from now.
Duty-free Mercosur items include meat and fish preparations, cucumbers, fruits and nuts preparations, petroleum jelly and some fertilizers. Duty-free Egyptian items include some vegetables, mineral fuels, machinery and their parts, some medicinal products, etc.
The agreement divided products into five categories. Group one was freed from duties, group two got 25 percent off, group 3 got 12.5 percent off, and group four got 10 percent off. Except for group one, duties on each of the four product groups will gradually drop each year (by the same rate as when the agreement first went into effect) until 100 percent is reached. Group five concerns sensitive products, which will be discussed separately.
Mercosur was founded in 1991 by Argentina, Brazil, Paraguay, and Uruguay, together forma market with 780 million people and a quarter of global gross domestic product.