Arab League intent on increasing investments in Brazil
The organization’s new ambassador in the Brazilian capital Brasília claims trade and mutual investment between Arab countries and Brazil can be worked on.
São Paulo – Newly appointed to represent the Middle East and North Africa countries in Brazil, the ambassador of the League of Arab States in the national capital Brasília, Nacer Alem, told ANBA on Thursday (17) that he will work to increase investment between Brazil and South American countries and the Arab nations. Alem, who took office in August, visited the offices of the Arab Brazilian Chamber of Commerce, where he was welcomed by CEO Michel Alaby and Government Relations manager Tamer Mansour. He said several agreements that have been signed with Arab countries are pending approval from National Congress and could give a new boost to trade.
“The Arab League wishes to further ties in all areas, from investment to technology exchange and sectors with shared commercial interest. However, we mustn’t focus solely on trade, because it grows or decreases depending on economic scenarios, on a specific crop, it can fluctuate for myriad reasons. The flagship [in increasing trade over the long haul] is investment,” said Alem, who has formerly served stints at the Arab League headquarters in Egypt, and in Germany and Cameroon, among other countries.
The diplomat concedes, however, that challenges need addressing before investment and trade can finally grow. “We have problems stemming from the lack of treaties to prevent double taxation and to guarantee investments. If agreement is reached on these topics, there will be a huge potential for Arab investment here,” he said. As an example of a hurdle to bigger trade numbers, he mentioned the free-trade agreement signed by the Mercosur and Egypt in 2010 that is yet to be approved by the Brazilian Congress. The Mercosur is a customs union comprising Brazil, Argentina, Paraguay, Uruguay and Venezuela.
Double taxation occurs when tax on one single transaction is levied both at the source and destination countries. For instance, when tax on a product made in Brazil and exported to an Arab country must be paid in both. This eventually renders business undoable.
According to the ambassador, the Maghreb countries – Morocco, Tunisia, Algeria, Mauritania and Libya – have agreements in place to prevent double taxation in dealings with the European Union. The same holds true of Saudi Arabia, Qatar, Kuwait, the United Arab Emirates, Oman and Bahrain, the Gulf Cooperation Council countries.
The diplomat believes the Brazilian government is striving to address these problems, but dialogue with National Congress must improve. He told ANBA that he has already met with Foreign Relations Ministry officials and made this plea. Alem noted that Arab sovereign funds and corporations already have investments in place in Brazil, and that there are Brazilian companies operating in Arab countries.
“This or that company might come to Brazil, meet with authorities and enter into specific agreements, but what we want is to build a proper environment for all investments,” he said. He also stated that as a delegate of the League of Arab States, he will work with each Arab country represented by the organization, as well as champion the demands they make as a bloc.