Over the past year, the Brazilian REAL (BRL) has lost about 70 percent of its value. The real’s (BRL) devaluation created a number of problems like a hike in inflation, but for some businesses like the textile industry, it also brought hope of new opportunities.
The president of Sao Paulo’s Union of Textile Industries said the last five years were tough for local producers as they saw Asian competitors gaining much ground, particularly with major retailers.
The Le Sense Moda is a small family company, which produces and sells its own label of women’s clothing in Sao Paulo. Until last year, the appreciation of the Brazilian currency made it hard for them to fight foreign competition, as Asian players flooded the market with cheaper products.
The devaluation of the Brazilian currency is great news for local companies willing to sell their products abroad or trying to regain some market share lost to import goods over the past years. On the other hand it is a problem for businesses interested in exporting to Brazil.
The consensus is that 2016 would be a tough year for business in Brazil, but one that would also offer new opportunities to some sectors in a challenging climate.
CCTV’s Paulo Cabral reports from Sao Paulo.
Follow Paulo Cabral on Twitter @paulonumundo