In January 2008, the President of Brazil himself disclosed the country’s upcoming business deals with Cuba. There were several reasons for which Brazil wanted to start business with Cuba. One of them was to help Cuba to make their deep water oil exploration programs efficient.
In this paper we will summarize the objectives of the deal as well as discuss about other relevant matters regarding that business deal. The honorable President of Brazil, Mr Luiz Inacio Lula da Silva, said on 13th January 2008 that the country would go for a business deal with Cuba. The President would sign in several business agreements during his upcoming visit to Cuba.
The Brazilian President hinted that they would spend over 500 million dollars for the development in Cuba. This would be the 2nd visit by the Brazilian President Lula in Cuba after 2003.
However, high rate of economic growth has accelerated the import business in Cuba. During 2002-06, the import businesses increased by almost 8.92 billion dollars. The trade deficits climbed upto 6.35 billion dollars in 2006, 4.86 billion dollars more than that of 2002.
According to the report given by the Brazilian Trade Ministry, the country’s exports to Cuba also increased about fivefold during 2002-06. In fact, in 2006, the export amount was almost 343.8 million US dollars, which was almost equal to 0.2% of the total exports made by Brazil for that financial year. Brazil mainly exports sugar, meat products, electrical equipments and candy to Cuba.
Objectives of the Deal:
Brazil wants to help Cuba to advance their deep water oil exploration programs. Cuba is situated near the Mexican gulf.
Brazil aims to trigger their businesses with the Caribbean island, where the yearly economic growth has been more than 6% for the last three years.