The Thailand-Brazil Business Council will be soon set up to exchange information and enhance cooperation in a wide range of industries, particularly automobiles and parts, food and renewable energy.
Thailand and Brazil have also agreed to hold the Thai-Brazilian Business Forum every year to elicit private sector cooperation and create growth opportunities for businesses, especially SMEs.
Deputy Commerce Ministry Alongkorn Ponlaboot said last week that as one of the world's leading emerging nations, Brazil has the fastest economic growth in Latin America. It has been emphasising promising high demand in line with its 190 million population. However, very few Thai enterprises have exported or invested here due to the lack of public and private sector cooperation.
The setting up of the business council and summit will open up more opportunities for both countries' businesses, he said. The council should be formed in three months so that information will be systematically exchanged. The first business forum will be next year.
Alongkorn led a trade mission to Brazil, Peru, Chile and Argentina last week. The agreement to set up the council and forum came after he met with the investment promotion agency called Invest Sao Paulo and the Department of Foreign Affairs and Trade.
"Although there are many similar exports such as automobiles and parts, sugar, textiles and agricultural goods, Thailand should not compete directly with Brazil. Instead, it should focus on setting up trade missions and on cooperation to benefit both countries." he said.
With the cooperation of Brazil, Thailand can not only distribute its goods to the local market, but also to other countries in Latin America, he said.
Although the long distance was a hindrance, both nations will extend cooperation in logistics development soon.
Brazil is the world's eighth largest economy. Trade with Thailand reached US$2.3 billion last year. Thailand's exports were worth $1 billion while imports were worth $1.32 billion.
Mario Mugnaini, president of Invest Sao Paulo, said the Brazilian government offers a tax regime and financing support for foreign investors. As São Paulo is the country's biggest state in terms of gross domestic value, the state is one of the most interesting for Thai investors.
Many industries are wide open to foreign investment here including foods, logistics and the airport rail link project, and renewable energy development, he said.
Exports with strong potential for the Brazilian market are rubber, car parts, steel and cement. It will need huge shipments of construction materials for upgrading infrastructure, as the country will host the 2016 Olympics, he said.
Phairush Burapachaisri, secretary-general of the Board of Trade of Thailand, said the formation of the business council would encourage Thai exporters and investors to learn more about trade and investment opportunities in Brazil and Latin America.
"We lack in-depth information for marketing in the region. The agency should help reduce trade barriers such as transportation, and high freight costs to Brazil since more traders will support the development of the logistics system," he said.
As two of the world's leading producers of sugarcane and exporters of sugar, Brazil and Thailand have agreed to collaborate in the industry.
After meeting with the Brazilian Sugarcane Industry Association, Alongkorn said Brazil has agreed to forge closer ties with information exchange on renewable energy development.
They will exchange information on producing diesel from sugarcane, production technology for bioplastics and the development of flex-fuel vehicles.
Nayana Rizzo, institutional relations, said Brazil is the world's leader in flex-fuel vehicles and users, with at least 10 million flex-fuel cars in service.