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The Brazilian economy is facing a great challenge as the “Weak Meat” scandal hits two of the country’s biggest meat exporters.
Brazilian authorities raided meat processing plants that were allegedly bribing government officials and health inspectors to get certification for poor-quality meat products. Among the raided plants are those from two of the country’s meat packing giants, JBS and BRF. Due to the scandal, the two companies’ shares dropped 10% and 7%, respectively.
According to reports, these companies sold meat products that were either contaminated with salmonella or already rotten. As a result of the raids, three meat processing plants have been shut down, and 21 small meatpacking businesses are being investigated. In addition, several officials were accused of taking bribes, and at least 30 of them were suspended.
Brazil is banking on meat exports as one of the ways to solve the economic recession it is currently in. The country is among the world’s biggest meat exporters, supplying meat to 150 countries. Last year, Brazil exported $10.2 billion worth of chicken and beef. Therefore, the scandal may have a damaging effect on Brazilian economy as some of the country’s trade partners took measures to avoid Brazilian meat exports.
Several countries, such as China and Chile, temporarily stopped purchasing Brazilian meat products due to the scandal, but later lifted the ban. The first country to lift the ban, South Korea, did so after Brazil assured the South Korean government that no products from the plants in question were exported to the Asian country.