NEW YORK, Oct. 15, 2015 /PRNewswire/ -- With its expansive size, Brazil occupies most of the eastern part of the South American continent and its geographic heartland (50% of South America), as well as various islands in the Atlantic Ocean. Brazil is the largest economy of Latin America and its trade with the EU accounts for 34.4% of the EU's total trade with the Latin American region (2013). As regards investments, Brazil holds 53% of the entire EU Investment stocks in Latin America.
The Brazilian economy recorded a strong performance during most of the 2007-12 period, with real GDP growth averaging 3.6% a year, albeit with fluctuations. Growth benefited from strong domestic demand and favorable external conditions, including vigorous demand and high international prices for Brazilian commodities, which boosted the country's terms of trade. Economic Growth was supported by macroeconomic policies, focused on achieving a primary fiscal surplus and strict inflation targets, and a floating exchange rate regime, which contributed to consolidate macroeconomic stability.
Helped by an appreciating currency, and despite strong domestic demand growth, inflation has been kept under control, generally within the band of fluctuation allowed by the inflation-targeting policy. Sustained economic growth over almost a decade and active income policies have allowed Brazil to make important progress towards reducing poverty and income inequality, while employment figures have improved.The Brazilian market is relatively highly protected with an applied customs averaging tariff of 13.5%.
The WTO therefore consistently encourages Brazil to reduce tariff and non-tariff barriers, and to maintain a stable regulatory environment for International investors and traders.Mercosur, the "Common Market of the South," is an economic and political agreement among Argentina, Brazil, Paraguay (which is currently suspended), and Uruguay to promote the free movement of goods, services and people among member states.Mercosur's primary interest has been eliminating obstacles to regional trade, such as high tariffs and income inequalities. Brazil is part of Mercosur and part of the EU's ongoing negotiations for a free trade agreement with that regional group.
A future EU-Mercosur Association Agreement currently under negotiation should provide a boost to regional trade integration among the countries of Mercosur and stimulate new opportunities for trade and investment with the EU by removing tariff and non-tariff barriers to trade and FDI. The EU-Mercosur Association Agreement will cover, among other issues, trade in goods and services, investment, intellectual property rights (IPR) aspects including protection of geographical indications, government procurement, technical barriers to trade and sanitary and phyto-sanitary aspects.
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