Impacts of a trade liberalization agreement between the United States and the European Union on Brazilian Agribusiness

Abstract

This study measures the impact of a trade liberalization agreement between the United States and European Union on Brazilian agribusiness products. It uses an applied general equilibrium model (PAEG). The results show an increase in welfare in the regions involved in the agreement, $11 and $6 billion, respectively. However, Brazil loses $0.06 billion in welfare. There is a decrease of 0.25% on exports of these sectors and an increase in imports of only 0.01275%. Soybean and oilseed industry are the only sector with a positive response in production and in international trade flow.

Cicero Lima

Research Economist