THE IMPACT OF COMMERCIAL DISPUTE BETWEEN THE UNITED STATES AND CHINA IN BRAZILIAN AGRIBUSINESS

Abstract

This study aimed to analyze the impact of the commercial dispute between
the United States and China, in Brazilian agribusiness. In this sense, two simulations
were carried out to analyze the impact on the commercial flows (production, exports,
imports, prices and well-being) of the sector, through the computable general equilibrium model (MEGC), more specifically the Global Trade Analysis Project (GTAP).
Among the results, it was possible to highlight that the economic impacts for the export
values of Brazilian agribusiness would be positive only for the grain sector, because, in
the first simulation, with partial commercial protection, we observed a positive variation of 9.86% and, in the second simulation of a commercial dispute between China and
the United States with complete commercial protection, we observed a positive variation of 6.40%, evincing that the grain sector obtains gains from trade. These gains come
from decline of bilateral trade between China and the United States and an increase
in imports for their third trade partners, as in this case, Brazil, exporting more grains to
China. Nevertheless, for the other agribusiness sectors analyzed, the results obtained
from the proposed scenarios, in both simulations, are negative, being harmful to the
sectors as fruit and vegetables, sugar cane and others, livestock and meat and agroindustry products, in which it is possible to verify a reduction in production of Brazilian
agribusiness. This negative effect comes from the displacement of productive resources
(land, capital, labor) of the several agricultural and livestock sectors in direction to the
grain sector, which is the main sector of exports from Brazil to China and competes
directly with the USA in this market.