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S. America more cautious with Asia imports

April 19, 2012 at 3:39 PM   |   Comments

RIO DE JANEIRO, April 19 (UPI) -- Latin American importers are more cautious with goods they buy in East Asia and are hiring quality-control services to check their imports at source, new business data indicated.

The importers' caution hasn't affected the volumes but protectionist controls in Latin American countries are having an impact, the data showed.

AsiaInspection, an international provider of quality-control services for businesses that import from Asia, said inspections in Asia ordered by Latin American importers increased from the first quarter of 2011 by an average of 120 percent.

The company reported major increases in inspection orders from Latin America -- Colombia 180 percent, Panama 159 percent, Chile 87 percent and Bolivia 56 percent.

Brazil, Latin America's largest economy, saw one of the largest increases with inspection orders up 240 percent compared to the first quarter of last year.

"This growth, consistent with the increasing momentum of Latin America's economies, also demonstrates a realization by Latin American importers of the necessity of securing the safety and quality of product at its source," AsiaInspection said.

In larger terms, driven by the economic powerhouse of Brazil, Latin America's overall gross domestic product is expected to increase 4 percent through 2013, the company said citing International Monetary Fund reports.

Contingent to that growth, World Bank data showed that Latin American imports have increased by approximately 20 percent in recent years.

The strong growth in demand for quality-control services seen in the younger economies of Latin America sits in stark contrast when compared with order figures from Europe, which increased a modest 13 percent in the year from the first quarter of last year and the period ending in March this year.

In recent years Brazil and Colombia have emerged as China's biggest trading partners after the United States, mainly due to their exports of natural resources to China.

While Latin America exports mainly raw materials, Chinese exports increasingly comprise consumer electronics, textile and toy products. Importers have resorted to inspections at source -- in East Asian factories -- of what they contract to import.

Added to that has been a Latin American trend toward protectionist trade policies.

Argentina, Brazil and Colombia last year adopted protectionist measures, including new import taxes, to regulate imports of more than 140 products.

A new Brazilian customs control campaign is aimed specifically at scrutinizing Chinese imports.

The new regulations are forcing Latin American importers to implement stricter quality control at the source.

"Protectionist measures have certainly had an impact on Sino-Latin American trade," AsiaInspection Chief Executive Officer Sebastien Breteau said.

"The fact that we're seeing importers taking an increasing responsibility for their product and business reputation is encouraging," Breteau said.

AsiaInspection, founded in Hong Kong, has offices in the Americas, Asia, Africa and Europe.

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