MEDELLIN, Colombia  Brazil’s textile and apparel industry is forecast to grow 11 percent to roughly $47 billion this year as the improving economy is expected to boost local sales and a new trade deal with Colombia should fuel exports to the neighboring nation.

“Production will grow 5 percent this year,” Rafael Cervone, president of leading trade lobby Abit, predicted on the fringes of the Colombiatex trade show here, despite analysts’ views that Brazil’s October presidential elections could dent some of those gains if it becomes too volatile.

Brazil’s economy is expected to grow 3 percent this year — up from a 2.2 percent earlier forecast — while 2017 ended up stronger than expected, with growth said to have reached 1.1 percent, up from a 0.5 percent previous forecast.

After the painful three-year-long recession, Cervone said the industry is feeling sanguine, with textile sales and local apparel turnover expected to increase 5 percent each, boosting total growth to 10.7 percent, up from marginal gains last year and an 8 percent decline in 2016.

Meanwhile, exports will rise to $1.05 billion from $1 billion in 2017, Cervone predicted. Colombia’s recent signature of a free-trade agreement with Mercosur, the South American block comprising Brazil, Argentina, Paraguay and Uruguay, will sharply lift sales, he added.

“All the import tariffs were reduced to zero so we have an opportunity for both sides,” Cervone said, adding that Brazil intends to lift sales to Colombia beyond $30 million in 2017.

“We hope to grow 15 to 20 percent this year,” Cervone said, speaking from Abit’s pavilion at the regional sourcing fair, where Brazil led $356 million in potential sourcing contracts, up 60 percent from 2017. “We have an opportunity to export technical textiles for automotive and uniform markets, as well as nonwovens.”

Colombia also hopes to deepen its foothold in Brazil — where it only sends 0.8 percent of its products to Latin America’s largest market — and hopes its beachwear, underwear and lingerie brands will make a bigger splash. Before the trade deal with Mercosur was struck in December, Colombians paid respective 80 percent, 26 percent and 35 percent duties to send yarns, fabric and apparel to Brazil. In turn, Brazil paid 5, 10 and 15 percent for the same categories, in that order. The fledgling free-trade zone should also help both countries boost U.S. sales, observers said. This would happen by sharing fabric and other feedstocks between each other and the Andean Community block members Ecuador, Bolivia and Peru. Colombia is a CAN member.

Meanwhile, Brazilian makers are expected to invest $570 million to modernize machinery this year, up from $450 million in 2017, Cervone revealed. The bulk of the funds will go to new spinning mills, machine-to-machine or Internet of Things and Industry 4.0 pilot manufacturing plants.

In that regard, Cervone said Senai University in Rio de Janeiro recently launched a “magic mirror” leggings fitting plant that uses a digital scanner featuring 1,500 shape alternatives and is set to be ready in July. Customers will use the mirror to choose their ideal fit, which will then be delivered by drones, he explained. Four other pilots involving sportswear and other segments are in the works for the second half of the year, he added.

Big Brazilian players including Vicunha and Santista Textile are also eyeing investments in blockchain technology, Cervone said, adding that the advent of decentralized computer networks could initially help manufacturers and brands reduce cumbersome export bureaucracy. Farther down the road, it could also help tackle dumping and piracy threats.

“We are investing a lot in advanced manufacturing and product export certifications,” he noted. “These digital certificates are growing a lot in Brazil and we need them day in and day out. I think blockchain could give us a tool to get them quicker and cheaper” by providing a encrypted and time-stamped list of records and transactions.

Colombiatex, which turned 30 in this edition, drew 356 international buyers from 24 countries to purchase goods from 579 exhibitors, of which 40 percent came from Brazil, India and Spain. About 36 percent of the sourcing contracts were in textiles, 28 percent in machinery, 19 percent in feedstocks, 10 percent fibers and 7 percent in others, according to organizer Inexmoda. The seemingly positive results (the potential contracts will still need to be executed), boosted hopes that Colombia’s textile industry can emerge from its doldrums after big losses last year driven by a flood of undervalued fabrics, higher consumer taxes and slower economic growth.

Manufacturers are pleading that Bogota introduce antidumping measures to shore up the sector, something that it’s considering, observers said.

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