Guidelines on Brazil

Andre Amado

Ambassador of Brazil

November 10th, 2011

Entrepreneurship in the E.U. and BRIC-countries: Brazil

Vlerick Alumni FORUM

Frisomat Innovation Center

Stokerijstraat 79 – Wijnegem - Antwerp

Brazil: 5th largest country in the world 8.514.876 km²

World Trader: Main Brazilian Partners (% 2010)

Exports

27,9

23,8

21,4

9,6

5,2

4,6

2,4

Imports

30,9

17,0

21,5

15,0

2,6

6,2

1,7

Blocs

Asia

Latina America/Caribeean

EU

USA

Middle East

Africa

Eastern Europe

World Player

• Original member of the UN and its specialized agencies, as well as of MERCOSUR, WTO, G-20, BRICS (with China, India, Russia, and South Africa), CPLP (The Organization of Portuguese Speaking Countries), and IBSA (with India and South Africa);

• Together with Japan, Brazil is the country that has been elected more times (10) to integrate the UN Security Council as non-permanent member;

• Together with the USA and Russia, Brazil is the only other country that both has the world largest uranium deposits and masters the nuclear fuel cycle;

• It has the world’s largest maritime frontier with Africa; • It is one of the world’s richest countries in terms of ethnical

miscegenation (Native Brazilians and European, African, Middle Eastern, Asian and Latin American descents);

• It has one of the largest networks of resident diplomatic missions abroad (142), 36 of which in Africa;

Why invest in Brazil?

• 8th largest economy in the world• 8th largest consumer market• 3rd largest reserves of iron ore• World largest exporter of iron, coffee, orange juice, soybeans,

beef, chicken, sugar and ethanol• 6th largest manufacturer of automobiles • 3rd largest producer of aircrafts and 1st producer of commercial jets

(120 passengers)• World’s largest exporter and 2nd largest producer of ethanol • World’s largest commercial cattle herd, with over 198 million

heads• Brazil accounts for half of the economy of South America

Economic Data (2010)

• GDP: US$ 2.09 trillion

• Growth rate: 7,5 %

• Trade surplus: US$ 20.3 billion

– Exports: US$ 201.9 billion

– Imports: US$ 181.6 billion

• Forex reserves: US$ 311 million

• FDI inflow of 48.4 billion in 2010

Macroeconomic Policy - Last 16 Years:- Institutional and macroeconomic stability,

- Sustainable growth,

Fonte: IBGEElaboração: Ministério da Fazenda

8

Brazil recovers sustainable growth in 2010, 2 years after Lehman Brothers(in anual %).

* Estimativas Ministério da Fazenda

Macroeconomic Policy - Last 16 Years:

• Expanding domestic market,

• Innovative social policies,

• Income distribution projects,

• Modern and robust financial system,

• Rigorous balancing of public accounts, and

• Investment in agricultural R&D&I.

…That has allowed for …

• The consolidation of the major goal of sustainable economic growth by:

• Diversifying our trade partners,

• Increasing the volume of both our global trade and exports figures,

• Expanding our international currency reserves (US$310 billion in 2011),

• Eliminating foreign debt,

- Controlling inflation, Inflation under control

(Consumer Price Index-15, in % a.m.)

-Leading in clean energy production (46% of the Brazilian energy grid are from renewable sources),

Brazil’s Energy: 46 % from Renewable Sources

- Achieving high productivity levels in agricultural production of the main food crops,- Generating more jobs,

Growth Model that generates more jobs (in thousands of jobs).

-Leading in oil exploration in deep waters (pre-salt),- Fostering the air-jet industry, and- Advancing in the production and usage of bio-fuels.

Investments in infrastructure reached record in 2010(in billion R$, 2010 prices)

• Expanding the middle class population to around 105 million (55% of Brazilian overall population).

Growth of population classes A/B and C and reduction of D and E (in % of population).

BRAZIL - BELGIUM - IMPORTS - EXPORTS - TRADE BALANCE

-500

0

500

1 000

1 500

2 000

2 500

3 000

3 500

2005 2006 2007 2008 2009 2010 2011 est.

mill

ion

euro

s

X value

M value

X-M value

BRAZIL - BELGIUM

X/M/ Balance

value weight weight X /weight M

 (million euros) (million kg)

2005 X 1 658 8 656 10,81

  M 1 125 800  

  X-M 533 7 855  

2010 X 2 163 6 855 4,39

  M 2 293 1 561  

  X-M -130 5 294  

2011 (extrap. 8/12

to 12/12)

X 2 749 7 357 6,56

M 2 417 1 122  

X-M 332 6 235  

BRAZIL - BELGIUM - weight X / weight M

0,00

2,00

4,00

6,00

8,00

10,00

12,00

14,00

2005 2006 2007 2008 2009 2010 2011 est.

Argentina, Belgium, China, Japan and USA.

BRAZIL - OTHERS - TRADE RATIO weight X / weight M

0,00

5,00

10,00

15,00

20,00

25,00

30,00

35,00

40,00

ARGENTINA BELGIUM CHINA JAPAN USA

2005

2010

2011 est.

Direct Investments of Belgium in Brazil (Source: Banco Central do Brasil)

0

100

200

300

400

500

600

700

800

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011(7/12)

mill

ion

s U

S$

Brazil has become a very attractive economy

for investment in the wake of:

- PAC-1 (2007) and PAC-2 (2010):

The Growth Acceleration Program (PAC) is a strategic investment on infrastructure program that combines management initiatives and public works.

PAC 1: the program called for investments of US$ 349 billion (R$ 638 billion), of which 63.3% has been applied.

PAC 2: estimates investments of US$ 526 billion (R$ 958.9 billion) for the period 2011 - 2014. PAC 2 focuses on investments in the areas of logistics, energy and social development. BNDES is financing around US$ 101,4 billion.

Social Programs in Brazil

• Minimum wage policies,• Greater access to credit,• Priority investment in quality education and health,• Poverty combat in urban and rural areas,• Social protection policies in areas like food security,

social assistance, health and social security,

These programs have contributed to: – Better distribution of the national income,– Moving around 30 million people from D an E

classes to C class, and

- FIFA World Cup in 2014,

5,7

11,6

5,5

3,84,6

1,933,1

22,8

Stadiums Urban Mobility

Ports andAirports

TotalInfra Civil

Telecom and

energy

Security and

HeathHotels Total

Infra

R$ Billions

Direct impact: R$ 33 billions in investments in infrastructure and services

119,9

105,9

53,789,4

314,0

740,721,836,0

Rio deJaneiro

São Paulo Fortaleza Manaus Natal Salvador Recife Total

% of total% of total

Cities/PortsCities/Ports

• Passengers Maritime Terminal

• Land accessibility (area)

• Maritime accessibility

• Passengers Maritime Terminal

• Land accessibility (area)

• Maritime accessibility

Projects:Projects:

14%16%42% 12% 7% 5% 3% 100%

(Santos) (Mucuripe)

R$ millions; value of responsibility's matrix

Ports: A total of R$ 740 millions will be invested in 7 main Brazilian ports

- Olympic Games in 2016.

Games’ budget: US$ 14.4 billions: US$ 2.8 billion from the Organizing

Committee (Game’s planning and delivering) and U.S. $ 11.6 billion from

public and private resources.

55 main economic sectors that will benefit from the Olympic games in Rio are:

• Construction (10.5%)• Real estate and rental services (6.3%)• Services supplies to companies (5.7%)• Oil and gas (5.1%)• Information services (5%)• Transport, storage and mail (4.8%).

Thank you!