Worn in the Middle East: Exporting Footwear to New Markets The Shoes Connection As of 2014

Made in Brazil, Worn in the Middle East: Exporting Footwear to New Markets The Shoes Connection As of 2014, Brazil had the third-largest footwear industry in the world. Brazil’s footwear industry is known for its relatively more affordable leather, high quality and one-of-a-kind design. With the cost of footwear from Asian countries gradually rising, Brazil’s footwear trade has been gradually expanding into new countries. The top countries to which Brazil exports footwear are the U.S., Argentina and France.

In 2000, the Brazilian Footwear program was created by the Brazilian Footwear Industry Association (Abicalçados), in partnership with the Brazilian Trade and Investments Promotion Agency (Apex-Brasil). This program was designed to increase the import of Brazilian footwear in the following target markets: China, Colombia, France, Italy, Russia, South Africa, United Arab Emirates (UAE) and the U.S.

Interestingly, despite the 12.3 percent decline in total international sales from January to August 2015, Brazilian footwear exports to the UAE increased by 21.7 percent. Footwear industries registered UAE export revenues of USD 15.73 million, shipping 1.3 million pairs.

Abicalçados’ President Heitor Klein points out that the Brazilian Footwear program directed its focus to the UAE as one of the target markets for 2015 and 2016. Abicalçados ranks the UAE in the 12th position of largest buyers of footwear from Brazil. At the top of the list is the United States, followed by Argentina, then France. After the UAE, in 13th place, comes Saudi Arabia.

“Saudi Arabia has been maintaining stability in imports of Brazilian footwear, which is positive within the context of the widespread decline of exports. It’s an important market and that, certainly, reaps benefits of the work done in the UAE, a country that operates as a crucial gateway for the Arab market,” said Klein.

Preparing to Send Brazilian Footwear to the Middle East

As Saudi Arabia and the UAE have become important markets for Brazil, Brazilian footwear makers have to become increasingly knowledgeable of the import-export requirements for these countries.

The following documents may be required when exporting goods to Saudi Arabia:

1) Certificate of origin authenticated at a local chamber of commerce and translated into Arabic Saudi Arabian

2) Customs invoice (in triplicate)—the original invoice must be attested by the agency responsible for trade in the exporting country

3) A bill of lading

4) Insurance documents (if goods are insured by the exporter)—original documents must be

accompanied by an Arabic translation

5) Product Conformity Program (PCP) Certificate of Conformity, issued by an approved certification body/authorized inspection agency

6) Irremovable label showing the country of origin

7) Official cargo insurance (if applicable)

8) Letter of undertaking authorizing destination agent to perform customs clearance

9) Detailed packing list

The following documents may be required when exporting goods to the UAE (those marked with an asterisk [*] must be attested by the Embassy of the United Arab Emirates and the chamber of commerce in the products’ country of origin):

• Master bill of lading/house bill of lading for sea channel/master airway bill

• Commercial invoice

• Certificate of origin* approved by the chamber of commerce in the country of origin

detailing the origin of goods

• Transport certificate (steamship or airline certificate)*

• Packing list

• Copy of buyer and seller’s trade license

• Delivery order from a shipping agent addressed to a company licensed in the UAE

• Permits, wherever applicable

• A form or letter of exemption from customs duties in case the exemption requirements

are fulfilled, including a local purchase order (LPO)

Documents with a * must be attested by the Embassy of the United Arab Emirates and the Chamber of Commerce in the country of origin of the products.

Sometimes Less Is More

As with some countries, there is a substantial amount of documentation required to export goods to the UAE and Saudi Arabia. Many countries have made trade across borders easier by reducing the documentation required and addressing the complexity of documentary compliance. Given the ever-increasing concern for the environment, some countries, including the UAE, accept paperless trade. Argentina introduced a new Import Monitoring System, which reduced the time for import documentary compliance from 336 hours to 192 hours. International courier DHL supports paperless trade in the UAE. Dubai Customs’ electronic system Mirsal 2 streamlines document preparation and decrease the time

needed for international trading. The World Bank publication Doing Business 2017: Equal Opportunity for All ranks the UAE as one of the easiest countries to do business with (26 out of 190), based on a number of factors influencing business operations including the documents, time and cost required to export and import.

In 2014, Brazil’s investment in electronic systems to facilitate trade helped streamline transactions and reduced the time required for exporters to clear goods through customs in both Sao Paulo and Rio de Janeiro. The electronic system links customs, tax and administrative agencies involved in exporting. Exporters can submit declarations and other related documents electronically rather than in hard copy. Since then, most exporters have completely converted to the new electronic system.

Questions

1. What advice on documentation requirements would you give a Brazilian footwear company that wants to export its products to Saudi Arabia?

2. Who are the stakeholders who may use the Saudi Arabian Certificate of Conformity?

3. What are the purposes of each of the documents required to import into the United Arab

Emirates (UAE) and/or Saudi Arabia?

4. (a) The UAE accepts paperless trade. What impacts will this have on exporters to the UAE?

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