Monday, March 1, 2021

Amazon unstoppable in Brazil as profits flood in during pandemic

World’s largest online retailer is building more Brazilian logistics centres, creating 1,500 badly needed jobs for South America’s largest economy.

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Brazil’s first Covid-19 case was confirmed on Feb 26 this year, one day after its world-famous Carnival ended.

Since then, the country’s infection numbers have spiralled out of control and the authorities have cancelled next year’s Carnival. This is the first time in over a century the world’s biggest party has been called off.

The notorious knees-up was planned for February 2021. Months of preparation are needed every year as samba schools nationwide practise for massive, noisy parades through the streets of Rio de Janeiro.

The national tourism promotion agency said in a September statement that without a coronavirus vaccine, it is uncertain when such large public events will be able to resume.

With nothing to prepare for, and as Covid-19 tightened its stranglehold on the brick-and-mortar economy, Brazil’s population of well over 200 million has been stuck at home doing what people the world over have been doing in 2020: buying stuff online.

MercadoLibre, Latin America’s online shopping giant has seen profits at its Brazilian arm, one of its most important markets, more than double.

But it seems only right that the home of the Amazon, the world’s largest river and steaming rain forest, is also the hottest market on the planet for Amazon, the world’s largest online retailer.

Its profits make MercadoLibre seem like a callow newcomer. In this year’s third quarter, Amazon tripled its profits from a year ago, from US$2.1 billion to US$6.3 billion.

As Covid-19 continues to cut a swathe through Brazil’s population, the digital sales behemoth plans to expand its business there, in a move which will generate yet more billions of dollars’ worth of sales for the world’s richest man, Amazon founder Jeff Bezos.

In Amazon’s biggest expansion in Brazil since it set up shop there in 2012, the company announced this week it is opening three more logistics centres which will create 1,500 more jobs in South America’s largest economy.

The new centres mean Amazon will be able to increase the number of cities where Amazon Prime services, such as two-day delivery, are available.

“Brazil is the country with the fastest growth in Amazon Prime subscriptions,” Alex Szapiro, Amazon’s chief executive in Brazil, told Reuters.

That will be yet more music to Jeff Bezos’ ears. Only this time it should really be a noisy local samba, featuring fancy footwork and flowing hip swings to the thunderous beat of massed steel drums.

Whenever Carnival returns to the streets of Rio de Janeiro, it might behoove Bezos to at least bang a drum for his Brazilian customers.

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