Brazil's machinery and equipment sector expected to see positive 2023

The outlook for Brazil’s industrial machinery and equipment sector is positive, in part due to the construction segment, according to suppliers association Abimaq.

Last year’s sector revenues totaled 310bn reais (US$61.2mn), down 5.9% on 2021, while Abimaq projects an expansion of 2.4% for 2023.

"The civil construction sector in general, which includes the infrastructure segment, will likely make a positive contribution this year. The associations of these sectors have forecast an expansion, which will result in the purchase of more equipment," the head of Abimaq’s economy, statistics and competitiveness department, Cristina Zanella, said during a press conference in response to a question by BNamericas.

The more positive outlook is also based on government plans to increase spending on infrastructure and social housing.

Abimaq also expects investments of 12bn reais compared with 16.5bn reais in 2022, when Abimaq forecast 15.4bn reais.

According to Zanella, lower investments this year are linked to higher-than-expected spending last year, as companies updated their equipment and processes.

Zanella also said that the tax reform likely to be debated in congress will result in tax reductions on investments.

EXPORTS

Exports of industrial machinery and equipment totaled US$12.2bn last year, up 21%, with 37% going to South America and 33% to North America. 

Regional exports may benefit in the medium term from the Brazilian government’s plans to strengthen trade ties with neighboring countries.