RIO DE JANEIRO: July 28, 2016. A strike by Brazil's Customs officials is threatening to disrupt the Olympic Games scheduled to begin on August 05. The Sindifisco union of federal tax auditors has launched an indefinite strike in a bid to get a 5.5 percent pay rise.
According to UK delivery company Fastlane International, the union has organized several strikes since 2012 – some of them as long as 50 days. The current dispute will mean no Customs coverage every Tuesday and Thursday and will cost the government an estimated US$455 million a month.
Fastlane's head of Consumer Research David Jinks said that despite a "fast track" clearance for teams competing in the Olympics that should in theory bypass Brazil's usual Customs checks, officials still have the right to intervene and examine any shipment.
A report by Fastlane says the Olympics "could be the final straw" for Brazil's stretched infrastructure and warns exporters to consider the following:
• Brazil is the world's 9th largest e-commerce market, but the rate of growth has outpaced reforms the country's state post office leading to several months' delays for e-commerce imports.
• Heightened security is predicted to delay deliveries, Customs procedures are slow and arcane even without the current strike, and too many shipments simply "disappear".
• Brazil is ranked No.72 in Transparency International's corruption perception index and organised crime is a significant problem in some parts of the country.
• A post-Brexit UK does not have a free trade agreement with the country so imports face a flat tax of 60 percent plus 18 percent VAT for parcels, or six different taxes on items for resale.
"The potential for delays to the delivery of vital Olympic equipment during the Customs strike is there. It is to be hoped that Brazil's government will be able to intervene to stop any such actions, with the entire eyes of the world on the smooth running of the Games," added Jinks.
In a related move American Airlines Cargo says it has delivered 65 tons of broadcast equipment and athletic gear to Rio de Janeiro in time for the opening day. The consignments were shipped out of Japan, the UK and Australia over a three-week period to Rio's Galeão International (GIG) airport via Los Angeles and Miami.
Despite the strike, AA says all the shipments cleared Customs successfully and were delivered to different venues around Rio.