How can companies from all over the world open up the South American market?

According to American media reports, Republican members of the U.S. House of Representatives are drafting a bill that may revoke China's permanent normal trade relations status.

In contrast, Peru, the world's second-largest copper exporter, will host APEC leaders this week, with the Chinese national leader expected to attend and inaugurate a large new port constructed by China. Due to the significant demand for South America's main export products such as corn, copper, soybeans, beef, and battery metal lithium, China's influence in South America is rapidly expanding, with a growing focus on developing the South American market .

Notes for the South American Market

The economies of South American countries are developing well, and the market potential is enormous. China's economic and trade cooperation with South America is highly complementary, with great potential. However, from the current state of economic and trade development, there is insufficient mutual understanding and exchange between the two sides, and the opportunities for trade, investment, and cooperation have not been fully utilized. In the next steps of developing the South American market and economic and trade exchanges, attention should be paid to the following aspects:

1.Overall, South American countries do not have strong processing capabilities. Except for Brazil and Argentina, which have more complete industrial sectors, other countries have weak basic industries, especially in the field of mechanical and electrical products, which mostly rely on imports. It is important to consider strengthening economic and trade cooperation with South American countries in areas such as electronic products, home appliances, machinery and refrigeration equipment, and hardware tools.

2.South America is vast and rich in resources, especially in terms of oil, iron ore, copper, forests, and other resource reserves. Enterprises can seriously study cooperation projects in resource.

3.Carefully study the current trade methods and collection methods adopted by South American countries, adopt corresponding strategies, and avoid trade disputes and friction.

4.Pay close attention to anti-dumping investigations?against Chinese goods in some South American countries. To do this well,?enterprises should focus on quality, brand, and service consciousness to replace traditional price competition, improve the technical content and added value of export products, and avoid the pitfalls of low-price competition.

5.If you want to do business with South Americans, patience is very important. Don't think there's no follow-up if they don't reply to emails for a few days; it's very likely that their holidays have come up. When negotiating with South Americans, allow enough time for the lengthy negotiation process and leave room in the initial offer.

Difficulties in Entering the South American Market

1.Language. Spanish and Portuguese are the main languages in South America,?and Chinese companies need to overcome language barriers and strengthen communication with local partners. Localization of production is key to success in the South American market. Companies need to establish production bases locally, achieve localization of the supply chain to reduce production costs and improve competitiveness. At the same time, companies also need to strengthen supply chain management to ensure the stability of product quality and delivery times.

2.Information. Although customs and tax information in South America can be found intermittently on the internet, it is not as rich as the information resources in North American countries,?especially for customs clearance procedures, which have unique regulations and processes.

3.Payment. The payment methods in these countries are quite worrying, as L/C customers are not accepted, and there are foreign exchange controls in T/T.

4.Fraud. In trade exchanges, there are often some fraudulent behaviors, which are hard to guard against. For example, contract fraud, where some South American businessmen may provide false contracts, promising to buy a large amount of goods, but not paying for the goods after receiving them. They may use false bank guarantees or letters of credit to increase credibility. There is also cargo fraud, where criminals may impersonate freight forwarding companies during the transportation process, providing false transportation services, leading to the disappearance or illegal transfer of goods.

Special Requirements for Bills of Lading at Some South American Ports

1.Brazilian Ports

Freight must be displayed on the bill of lading, CNEE/NOTIFYTAXID (CNPJ), HSCODE, NCMNO., and container tare weight. Telex released, Sea Waybills, and destination releases are not accepted; only original bills of lading are issued.

2.Argentine Ports

HS CODE must be displayed on the bill of lading, as customs regulations require it. Failure to display will result in fines. The complete name, address, TEL/FAX/TAXID (CUITNO) of the SHPR/CNEE/NOTIFY can only be issued as original bills of lading and accept destination releases.

3.Chilean Ports

Freight must be displayed on the bill of lading, CNEE/NOTIFYTAXID. Telex released and Sea Waybills are not accepted; only original bills of lading are issued and destination releases are accepted.

4.Uruguayan Ports

The bill of lading must display a 4-digit HS CODE, SHPR name, address, tax number, CNEE name, address, tax number (RUTNO), NOTIFY name, address, telephone number, tax number (RUT NO), and accept destination releases.

5.Colombian Ports

The bill of lading must display the name/address/TEL/FAX/TAXID (NIT NO) of CNEE/NOTIFY. CNEE must be a local Colombian company. Telex released and Sea Waybills are not accepted; only original bills of lading are issued and destination releases are accepted.

6.Venezuelan Ports

The bill of lading should provide the TAX ID of CNEE/NOTIFY. Telex released and Sea Waybills are not accepted; only original bills of lading are issued and destination releases are accepted.

7.Peruvian Ports

Freight must be displayed on the bill of lading. Only original bills of lading are accepted and destination releases are accepted.

Specific Strategy — Taking Chile as an Example

1.Market Considerations in Chile

1)Export Recommendations

Furniture export companies may consider setting up processing plants in Chile, as there are many sawmills in southern Chile. The furniture produced can be directly consumed in the local market, which can reduce high sea freight. Chileans prefer durable goods and pay more attention to product quality than price.

2)Customs Regulations

The main ports in Chile are Valparaiso, San Antonio, and Iquique, with Valparaiso being the largest port in Chile.

When exporting to Chile, a Form F certificate of origin is required. Chile and China have signed an agreement on preferential tariff rates, and if the goods come from China, customs duties can be reduced or exempted.

Chile has labeling regulations for a series of products. Generally, products sold in Chile must be labeled with the name or registered brand, address, country of origin, and maintenance instructions of the manufacturer or importer. The information must be accurate and in Spanish.

Customs duty-free allowance is 500 cigarettes, or 100 cigars, or 1 pound of tobacco, 2 bottles of alcohol. There are no restrictions on the inflow and outflow of national or foreign currency; foreign currency must be declared upon entry and can be taken out upon departure.

It is prohibited to carry drugs and materials and equipment that may be used to manufacture drugs. Bringing in prohibited items or false declarations will be punished.

Chile has very strict animal and plant quarantine. The Chilean Agricultural and Livestock Service requires the inspection of personal luggage of all incoming passengers.

Incoming passengers should truthfully declare whether they are carrying animals, plants, or animal and plant products, chemical and biological products for agricultural activities, veterinary drug products, and animal food.

3)Payment Methods for Chilean Clients

(1) Letter of Credit (L/C) payment, in simple terms, is a settlement method where the bank pays on behalf of the importer to the exporter when the documents are in order. Its biggest advantage is that it uses bank credit as a guarantee for payment. Chilean buyers prefer to use the L/C payment method. After Chilean commercial banks issue a letter of credit, they can guarantee the exchange settlement. Currently, banks such as BICE, Banco de Chile, BANCO, and SORNO have established business relations with the Bank of China. If Chilean merchants issue a letter of credit through a commercial bank that does not have a business relationship with the Bank of China, a third-country bonded clause should be added.

(2) Telegraphic Transfer (T/T)?means that after a foreign trade company signs a contract with a customer, the customer pays a part of the deposit to the foreign trade company, usually 30%.?After the foreign trade company produces the goods, it notifies the customer to pay and settle the remaining balance, and then the foreign trade company can send out the goods and hand over the full set of documents to the customer.

(3) Western Union, is the abbreviation for the international remittance company (Western Union), which is the world's leading express remittance company with a history of 150 years. Currently, there are several cooperative banks in China, such as the Agricultural Bank of China, China Everbright Bank, and China Construction Bank, which can provide fast remittance services to withdraw money within a few minutes, and the recipient does not need to pay any fees.

2.Relevant Search Websites in Chile

1)Common search engines in Chile:

https://www.caribseek.com /

https://www.chilnet.cl/

Use translation software to translate product keywords into Spanish for searching, and you can find a lot of buyer information.

2)Free Chilean customs data:

https://www.tradesns.com/cn/data/buyer/Chile.html

To inquire about a product's buyer, enter the product keyword in the search box above to get some related buyers for free.

3)Chilean B2B website:

https://www.chilnet.cl/

Well-known Chilean B2B where you can post products and receive inquiries. Pay attention to the choice of words, appropriate descriptions, and more high-definition product pictures.

4)Chilean Yellow Pages:

https://www.websites.cl/

https://www.caribbeanonlineyellowpages.com

You can find product-related sellers in it, many of whom may also be importers.

5)Looking for various information in Chile:

https://www.chile.com

https://www.sitios.cl

https://www.websites.cl

https://www.buscar.cl

https://www.todochileinversiones.cl

6)Looking for Chilean importers and exporters, Chilean products:

https://www.amarillas.com

https://www.chilnet.cl

https://www.bizchile.cl

https://www.mercantil.com

https://www.chiledepot.cl

https://www.bolsadesantiago.com

3.Chilean Customs and Habits

Chilean business people are highly respected in society, so they pay attention to their attire and behavior. The main customs of Chileans are as follows:

1)Friends greet each other with a handshake. Even if they meet several times a day, they shake hands each time. For familiar women, you can kiss the cheek instead of shaking hands, which shows a closer relationship.

2)For familiar friends or clients, you can call them by their first name; otherwise, address them with "Senor" and their surname; for married women, use "Senora" with their husband's surname; for the client's female secretary or driver, you can call them by their first name.

3)When visiting clients, pay attention to neat attire, wear a suit and tie, keep your hair neat, and polish your shoes. Especially the back of the suit should be kept clean. Neat attire is the most basic courtesy.

4)For formal dinners or cocktail parties, it is appropriate to wear a dark suit and a suitable tie; for luncheons, a suit is also required, with no restrictions on color. When invited to a Chilean's home, you can bring a small gift.

5)Any appointment should be made in advance and?arrive on time.

6)Do not give expensive gifts if the business is not concluded, as it may make them suspicious of the giver's intentions.

In today's globalized world, South America is becoming increasingly important. When exploring the South American market, companies from all over the world should not only focus on economic and trade opportunities, but also have a deep understanding of local culture, laws and business practices.

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