PROMOTION

Brazil, land of the samba, Sugar Loaf Mountain andCopacabana beach, is also distinguishing itself in the midstof the worldwide financial crisis by the resilience of its eco-nomic performance.In the face of the global slowdown, the Brazilian econ-

omy is predicted to grow this year by a relatively respectable2.5%. Last year, the South American nation achieved thenotable feat of being the least affected by the internationaleconomic downturn.Although business activity in Brazil slowed gradually

through the last six months of 2008, its economy maintainedan overall growth rate estimated at 5.2%. This was a moresubstantial performance than that of any of the world’s mostdeveloped economies.

Significantly, domestic demand, rather than exports, hasbeen the main driver of Brazil’s growth. While highlyunequal income distribution continues to be a major prob-lem in this nation of almost 200 million people, it is the coun-try’s burgeoning middle class that has fueled the economy’sexpansion.The highest-earning 10% of the population comprises

20 million people, and households with an annual dispos-able income of more than US$7,500 increased from 42.7%to 57.1% between 2005 and 2007.For the first time in a generation, Brazilians have been ben-

efiting from stable economic growth, low inflation rates andimprovements in their social well-being.

BRAZIL

Continued on next page >>

Despite the global economic gloom, this Latin American giantis enjoying growing prosperity, tax cuts and increased productivity.

confidence is the keyword

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2 BRAZIL= PROMOTION

Determined to maintain domestic con-sumer confidence in the face of a global cri-sis that will reduce the country’s exports,President Luiz Inácio Lula da Silva’s govern-ment has cut personal taxes and the tax onindustrial products by $3.6 billion.

At the bottom end of the affluence scale,the government has announced plans toextend its aid program to 2 million morepoor families, bringing the total number offamilies receiving financial assistance to 13million.

Fortunately, the Brazilian economy iswidely diversified, and the agriculture sec-tor, which feeds the nation, continues tothrive.

“Brazil can afford to be self-sufficient inalmost all agricultural products,” saysReinhold Stephanes, the minister of agricul-

ture. “The agriculture sector has grown overthe past year by an average of 5% annually,and everything indicates that we can growat the same rate for the next 20 years.”Almost 75% of that growth is due toincreased productivity, he says.

Production of ethanol from sugarcane willbe doubled in the next eight years on spe-cially zoned pastureland so as not to inter-fere with food production.

The other good news is that the govern-ment plans to reduce the deforestation of theAmazon rainforest by 70% over the nextdecade. This should prevent the pumping of4.8 billion tons of carbon dioxide into theatmosphere – more than the combinedcommitment of reductions promised by theindustrialized nations under the 1997Kyoto Protocol. �

By Michael Knipe

A Healthy Bank BalanceBrazil’s financial sector has learned from experience.

Brazil has more than a hundred banks, and in contrast to the situation in otherLatin American countries, most of them are locally owned. Although two of the

country’s biggest financial institutions, Itaú and Unibanco, merged in November 2008and further consolidation of the banking sector is expected in 2009, Brazil’s localbanks continue to enjoy good reputations. They are known for the efficiency of theirmanagement and the high standards of their facilities and technological equipment.

They have had little exposure to the subprime crisis and, as a consequence of highlevels of inflation and instability in the past, they have developed sophisticated mod-ern systems of operation.

One of the leading state banks, Banrisul, the largest in southern Brazil, underwentan initial public offering (IPO) two years ago that boosted its capital by $874.9 mil-lion while generating $568.7 million for the state of Rio Grande do Sul.

The bank used the revenue to expand its credit operations and invested in increas-ing and updating its information technology. “Our bank is a leader in banking tech-nology,” says Fernando Guerreiro de Lemos, Banrisul’s president. “Our Internetbanking is effectively the most advanced in Brazil.”

Following the IPO, the bank’s equity rose by 115% to $1.18 billion, and its totalassets reached more than $8.8 billion, an increase of more than 30% over the$6.8 billion recorded in December 2006. Banrisul reduced its operating costs by 19%,and the volume of business per employee increased by 23%.

Banrisul handles 97% of the banking market in Rio Grande do Sul, and more than25% of the state’s GDP is channeled through its branches. The bank is effectivelythe tenth-largest financial institution in Brazil. With nearly 3 million customers, itreturned a net profit of $196.4 million in 2007, an increase of 153% over the pre-vious year.

Guerreiro de Lemos says Banrisul will continue to grow within its immediate cus-tomer base and is expanding into the neighboring state of Santa Catarina. “We areopening ten more branches there,” he says. “Our aim is to become the largest regionalbank.”

Another notable institution is the Banco do Nordeste do Brasil (BNB), which man-ages CrediAmigo, the largest micro-credit program in South America and the sec-ond largest in Latin America. Through this program the bank has lent more than$655.6 million to small-scale entrepreneurs. �

Continued from previous page

3BRAZIL= PROMOTION

A GrowthMarketForeign investors have found fortunein Brazil, but now successful localcompanies are seeking expansionat home and abroad.

With a wealthy class estimated tonumber 20 million and an increas-

ing middle class of consumers, Brazil hasbecome a magnet for direct foreigninvestment.

While companies such as ThyssenKruppof Germany, Baosteel of China, Hyundai ofSouth Korea, Suzuki of Japan and severalU.S. hotel chains haveestablished a profitablepresence in the country,the economic growthover the last seven yearshas also been a blessingfor a wide range of long-standing Brazilian com-panies.

One of these, theYpióca Group, begancultivating sugarcaneand producing cachaça,the Brazilian liquor dis-tilled from unrefinedsugarcane juice, in 1846.

Now run by thefourth generation of thefamily that founded thebusiness, Ypióca hasbecome a conglomer-ate of seven companies encompassingpaper, cardboard and mineral water pack-aging, bottle manufacturing, farming, logis-tics and marketing, as well as cachaçaproduction.

“We are the only 100% Brazilian groupthat has been in existence for 163 yearsunder the control of the same family,” saysEverardo Telles, the Ypióca Group president.

He emphasizes that the group is notrestricted to family members and is open tocompetent outsiders. He explains, however,that in the Brazilian beverage sector the

most traditional brands are managed byfamilies who preserve the secrecy of theirproduction methods.

“The company has learned and grown,generation after generation, and Ypióca hasthe identity of the family,” he says. Today,the group’s companies generate more than20,000 jobs, both directly and indirectly.

Telles says Ypióca is always seeking bet-ter varieties of sugarcane and subproductsfor cane. It is continuing to diversify andplans to begin beef and veal processing. Thegroup exports 5% of its output, mainly toSpain, Portugal and Germany, and is plan-ning to send export managers to the U.S.and Japan to open up the markets there.

Another homegrown company of note isM. Dias Branco, the country’s leader in bothvolume and sales in the cracker and cookiemarket, as well as the pasta sector.

The company has 12factories, sells its prod-ucts throughout thecountry and is responsi-ble for 20% of the mar-ket in each of the sectorsit serves. “We haveexperienced growthbecause of the improve-ment in the purchasingpower of the popula-tion,” says FranciscoIvens de Sá DiasBranco, the companypresident. His father,Manuel, started thebusiness in 1927, andFrancisco joined as ayoung man in 1953.

M. Dias Brancoinvests more than

$437,000 a year in its 17 research and analy-sis centers, which develop new products.“You cannot be isolated from interna-tional developments, because the customeris more demanding,” says Dias Branco. “Sowe want to produce here all the best prod-ucts made in the U.S. and Europe.”

Demonstrating the private sector’s commit-ment to social responsibility efforts,M. Dias Branco, which employs more than13,000, attaches great importance to itssocial and human relationships with thewider community as well as its employees. �

At the time of press, the currency conversion rate used was Brazilian reals to U.S. dollars – R$1 = US$0.437.All monetary figures stated are U.S. dollars unless otherwise indicated.

Director: Lucas Montes de Oca; Managing Editor: Beverley Blythe; Editor: Michael KnipeArt Director: Lisa Pampillonia

Project Managers: Florence Lilti, Mathew Harris, Samantha Lewis and Jorge MaraimaProject Development: Charlotte Saint-Arroman; Commercial Director: Carolina Mateo

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Huge infrastructure projects andinitiatives to restock the rainforestare some of the public-privatepartnerships emerging from theregeneration of Brazil’s regions.

State governments in the north and north-east regions of Brazil are investing ambi-

tiously in infrastructure projects and openingtheir doors to international investors.

These two regions extend more than2,500 miles across the country – from thewestern border with Peru through theAmazon rainforest to the eastern seaboard– and offer a wealth of entrepreneurialopportunities in trade and tourism.

Rio Grandedo Norte, thecountry’s mosteasterly state, is about to build an airportthat will be the largest cargo terminal inLatin America, with the capacity to receiveup to 40 million passengers a year.

Pará, the neighboring state to the west,provides a gateway to the Amazon basinand is planning a tree-planting campaign tocombat the deforestation of the rainforest.

Wilma Maria de Faria, the governor ofRio Grande do Norte, says the next fouryears will see a huge generation of invest-ment in the state infrastructure throughpublic-private partnerships.

In addition to the airport, the federal gov-ernment is investing in a major natural-gas-to-chemicals project in Rio Grande doNorte, and a bridge has been built to linkthe two districts of Natal, the state capital.

Other projects include improvements tothe city’s port facilities and the construc-tion of new highways, a convention cen-ter and additional facilities for the tourismand business sectors. It is estimated thatthese projects involve investments totaling$6.5 billion.

“The bridge is now a monument to thecity,” says Governor Faria, adding that theattraction of the convention center has dou-bled tourism numbers.

Situated on the easternmost corner of

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Brazil, Rio Grande do Norte has 250miles of coast, lined with popular beaches.Thanks to the winds of the South Atlantic,it boasts air that is second only to theAntarctic’s in its purity, and sand dunes thatreach 160 feet in height.

“Our GDP is the highest in the northeastregion and above the Brazilian average,”says de Faria. “But despite this, we have tocombat poverty, and this is a big challengefor us.”

Besides tourism, the state has a flourish-ing business in fruit, shrimp farming, bee-keeping, tuna fishing, mining, cement andtextile production. Nevertheless, the gover-nor says, plenty of opportunities remain openfor investment, and there is a business cen-ter to explain what incentives are available.

In Brazil’s northern region, Pará, thecountry’s second-largest state with a pop-ulation of 5 million, major investmentprojects include a $3.5 billion steel mill, apower plant and port expansions.

Belém, the state capital, sits on the deltaof the Amazon River about 80 milesinland from the Atlantic. It is the main portfor river traffic and for the country’s cap-ital, Brasilia, more than 1,200 miles inland.

The rainforest and its people are at the

heart of the state’s economy. “It isnot enough to say that deforestationis not good,” says Ana Júlia Carepa,the governor of Pará. “To combatdeforestation, the people who live inthe Amazon have to have a prof-itable economic activity.”

To promote the sustainable devel-opment of the rainforest dwellers, anew program is providing a line ofcredit to enablesmallholders toplant cash-croptrees. They willnot have to repaythe loans untilsix months afterthey’ve sold thetimber from amaximum of20% of the firstgeneration oftrees. More than20,000 families are involved in the project,and the target is to plant one billion treesin five years.

“This project is truly innovative,” saysGovernor Carepa. “It encourages a differ-ent economy here in the Amazon, saving

the forest and helping people improve thequality of their lives.”

Pará is promoting its tourist attractionsas far away as China.

The growth-acceleration program initi-ated by Brazilian President Luiz Inácio Lulada Silva has been the driving force behindmuch of Pará’s infrastructure work, includ-ing the expansion of the port of Vila doConde and the plan to build a port atMarabá, a town 300 miles upstream fromBelém. And the government is offeringincentives to invest in the state to privatecompanies that can generate employmentwhile respecting the environment. �

From left to right:Mangal das Garcas park, Belem; City hall, Natal;New bridge linking Natal to northern beaches;

Park in the city of Belem; Vero Peso Market, Belem.

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Beyond offering beautiful beaches,Brazil’s southern coasts provide oiland gas – and plans are afoot tobuild the biggest science technologypark in Latin America.

Santa Catarina and Espírito Santo are sit-uated on Brazil’s south and southeastern

coasts and have benefited economicallyfrom their locations.

Santa Catarina, which is about the size ofthe state of Indiana with a similar-size pop-ulation of 5 million, is a major industrialand agricultural center and has one of thehighest standards of living in the country.Espírito Santo is only half its size, butencompasses some of Brazil’s busiest ports.

Although Portuguese fishermen first set-tled Santa Catarina, the next immigrants toarrive were German and Italian, and influ-ences of all three cultures remain. The state’scharacter is enriched by colonial architec-ture, fishing villages and traditional craftbusinesses such as lace making.

Tourism is a dominant element in theeconomy. The Atlantic coastline is dottedwith 40 beaches, some featuring languidlagoons and others with crashing waves thatattract surfers. Each beach draws a differ-ent clientele, the northern ones appealing tofamilies and others to trendy singles.

Florianópolis, the capital, is locatedpartly on the mainland and partly on aneighboring island that shares the nameSanta Catarina with the state. Two bridgesconnect the city’s halves, with business cen-tered chiefly on the mainland and tourismmostly on the island.

Luiz Henrique da Silveira, SantaCatarina’s governor, says his state is uniquein Brazil because of its system of regionaldevelopment. “We are the only state notgoverned from the capital city,” he says. Ineffect, it comprises 36 micro-regions, eachwith a local council that has the autonomyto choose its areas of development.

“People participate in monthly meetings,which give them greater social control,” says

Mixing Business WithPleasure

Santa Catarina: Hercilio Luz bridge, Florianópolis;Surfing at Praia Brava, Camboriu;

Barra da Lagoa, Ilha de Santa Catarina

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the governor. “This is something absolutelynew in Brazil and Latin America.”

The state’s scientific sector is high on theeconomic agenda for further development.The state devotes 2% of its budget to thesector. It has created several technologyparks and is planning to build one it aimsto make the largest in Latin America.

Efforts are also under way to haveUNESCO declare Florianópolis a worldbiosphere reserve. “It is a certificationthat will distinguish the city’s ecologicalstandards,” says Governor Silveira.

With or without such distinction, thestate capital has a reputation for glamour,fun and efficiency, and holds a strongappeal for tourists and businesspeoplealike.

Further up the coast, the discovery ofsubstantial offshore deposits of oil and nat-ural gas has boosted the economy ofEspírito Santo. A sliver of land, it has alively tourist industry and is surrounded bythree much larger states, Rio de Janeiro,Minas Gerais and São Paulo.

Espírito Santo’s economy originallyfocused on its coffee plantations, but it isnow Brazil’s largest source of gas, the coun-

try’s second-largest source of oil and theleading exporter of marble and granite.

The state is also active as a processor oflimestone for the steel industry with tenplants, including one that is the largest pel-letizing complex in the world. Pelletizing isa method of agglomerating materials intopellets. “This is an area of industry that isgrowing in Espírito Santo and shouldreceive new investments in the comingyears,” says Paulo Hartung, the state’sgovernor.

Investment in the energy sector hasenabled the state to triple local power gen-eration. It is now seeking partners toinvest in the road system. “The economyof Espírito Santo is experiencing a goodmoment,” says the governor. “We have asmall budget surplus, which is rare inBrazil.” �

7BRAZIL= PROMOTION

Espírito Santo. Open doors to the world.

EspíritoSanto

Rio Grande do Norte

Bahia

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Ceará

Paraíba

Pernambuco

Alagoas

Sergipe

Maranhão

Rio de Janeiro

Minhas Gerais

São Paulo

Espírito Santo is one of the fastest growing states in Brazil. It is the country’s largest

supplier of natural gas and the 2nd largest producer of oil while also

boasting strategic logistics and location: seven ports, railroads, highways, gas

pipelines and mineral pipelines.

It is a place of opportunities, political-institutional stability and economic

diversification, with a development strategy defined until 2025. A state that has received companies from all over the world. And it is

ready to receive yours as well.

The superb attractions of SantaCatarina and its capital Florianópolis willbe brought to international attentionwhen the state hosts a Global Travel &Tourism Summit in May.

Travel and tourism industry specialistsfrom all over the world will gather inFlorianópolis and discover firsthand whySanta Catarina, with its lagoons, lushgreenery and crashing surf beaches, iswidely regarded among well-travelled visi-tors as the most beautiful state in Brazil.

Santa Catarina tourism officials believethat, when the visiting travel agents returnto their home bases, they will be ideallyequipped to endorse the appeal of thestate and the city to their clients.

Espírito Santo: Panoramic view of Vila Velha;Golden lion tamarin, perched on a branch;

Muqueca Capixaba, a traditional dish of the region;Pedra Azul Park

BrazilPhotos.com/

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We invest in what is most valuable to your company: the people.

Together, we have a long life ahead of us.

Central Nacional

Central Nacional Unimed. Ten years caring for the lives of over 780,000 people throughout Brazil.

www.centralnacionalunimed.com.br

Samaritano Hospital is one of the best hospitalsin the world according to Joint CommissionInternational, the most important certifyingbody of health care quality standards.This recognition was made possible thanksto our stringent procedures, cutting-edgetechnology and the high level qualificationof our clinical and nursing staff.

Want to know more? Access www.samaritano.org.br or send an e-mail to internacional@samaritano.org.br

Hospital Samaritano - Sao Paulo, Brazil.Reaccredited for the 2nd consecutive timeby Joint Commission International.

Investments in technology and human resources to ensure the best for your health.

Delivery of Brazil’s government-fundedhealthcare system is hampered by the

disparity between rich and poor, the vast-ness of the country and underfunding. Asa consequence, a parallel system of privatehealthcare serves a quarter of the 200 mil-lion population, with public and privatepatients often treated in the same hospitals.

One of the country’s largest and most suc-cessful healthcare service providers in thisnetwork is Central Nacional Unimed, acooperative set up ten years ago that nowhas 106,000 medical practitioners serving15 million people.

Another notable provider, HospitalSamaritano of São Paulo, one of the coun-try’s oldest medical institutions, first openedits doors in 1890. It’s now a member of theNational Association of Private Hospitals,a group of 36 hospitals distributed through-out Brazil.

Unimed is represented in 377 cities cov-ering 80% of the country. Of the 377 coop-eratives, 82 have their own hospitals.

Dr. Mohamad Akl, the president ofUnimed, says one of the service’s distinctivequalities is its cooperative status. “The doc-tor who attends the patient is the owner,”says Dr. Akl. “This is the differential of thecooperative system.”

Dr. Akl believes that foreign companiesarriving in Brazil will need to providemedical insurance for their employees, andthis will help the Unimed system expand itsclient base. Last year, he says, there wasgrowth of 18%. Taking into account the

current economic situation, he expects aslower growth of 10% this year but is hop-ing for more.

Hospital Samaritano’s high standard ofhealthcare is vouchsafed by its accreditationfrom Joint Commission International, a not-for-profit organization whose certificationis recognized worldwide.

Samaritano is strong in neurosurgery,orthopedics, intensive care services, cardi-ology and bionic ear surgery. “We were thefirst hospital to bring to the private networkthe cochlear implant that sends electronicimpulses from a computer to the brain,”says Dr. José Antônio de Lima, Samaritano’sdirector.

The hospital’s other assets are its 19th-century philanthropic traditions, the provi-sion of more nursing staff because nurses areless costly in Brazil than in other countriesand, not least, a preparedness to welcomepatients’ companions.

“Culturally, in Brazil, when you have sur-gery, a member of your family will be there,sleeping in the room with you,” says Dr.Lima. “It is a huge plus. In America youcan’t do that. In Europe it’s very difficult.In Great Britain it’s impossible.”

Samaritano even has programs that allowpatients to have their pet dogs with them.“You know, Brazilians are much moreemotional, much more friendly and smiley,”Dr. Lima explains. “The whole process ofhealthcare is completely different and moresympathetic here. The staff wants to hearwhat your problem is.” �

Where a Woof and aSmile Work WondersBrazil’s pioneering hospitals allow surgical patients to have relatives staywith them and even welcome pet dogs.

Advertiser Directory

Banrisul www.banrisul.com.br

Hospital Samaritano www.samaritano.org.br

M. Dias Branco www.mdiasbranco.com.br

Unimed www.unimed.com.br

Ypióca Group www.ypioca.com.br

Govt. of Espírito Santo www.es.gov.br

Govt. of Mato Grosso do Sul www.ms.gov.br

Govt. of Para www.pa.gov.br

Govt. of Rio Grande do Norte www.rn.gov.br

Govt. of Santa Catarina www.sc.gov.br

9

Its name should be as recognizable as theAmazon. It is larger than New Mexico

and is the world’s largest freshwater wet-land, with an unparalleled variety of floraand fauna. Yet beyond environmentalenthusiasts, the Pantanal is little known.

André Puccinelli, the governor of MatoGrosso do Sul, the state in which 70% ofthe Pantanal is located, intends to challengethis ignorance. And, while publicizing theattributes of his state’s ecological paradise,he intends to more clearly establish theidentity of Mato Grosso do Sul, often con-fused with its northern neighbor MatoGrosso, from which the federal governmentseparated it in 1979.

“We are starting an international cam-paign, distributing DVDs, pictures, booksand folders of information about our stateand the Pantanal through Brazilianembassies around the world,” he says.

GovernorPuccinelli hasa reputationfor gettingthings done. “When I took office in 2007,the state had a monthly revenue of R$350million [US$153 million] and a deficit ofR$30 million [US$12.9 million],” he says.“Now we have a monthly revenue ofR$470 million [US$205.4 million] and asurplus of R$40 million [US$17.5 mil-lion].”

The state has completed some new infra-structure projects and begun others, and hasincreased and exceeded its house-buildingtargets, creating work for low-skilledworkers.

“We are now the fifth-largest producerof ethanol in the country and by 2015 willbe the second largest,” says Puccinelli.

The state’s economy is based primarily on

livestock, grains andforestry. The govern-ment is now takingmeasures to induceinvestment projectsthat will add greatervalue to homegrownresources.

“We produce10 million tons ofgrain, 5 million tonsof soybeans and

more than 3 million tons of corn,” says thegovernor. Yet the state has only one indus-try based on these products. It also has hugereserves of minerals, but lacks investmentin exploration and processing.

“What we need is industrialization toturn iron into final products, processmeat and initiate other projects,” saysPuccinelli. “For such projects the state maygive land free of cost.”

One of Mato Grosso do Sul’s biggestattractions for investment is its land, whichit claims is more competitively priced thanland anywhere else in Brazil. “And we offerexemption of up to 90% of taxes for ini-tiatives that are lacking in the state,” saysthe governor. �

Stake Your ClaimAn ecological paradise that wants to encourageinvestment in manufacturing offers free land andtax incentives.

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Brazil has declared this year “DestinationAmazonia” in an effort to increase the

number of tourists visiting the rainforest.Brazil, along with the governments of the

seven other nations bordering the region,believes that the best way to preserve the for-est is to take measures to alleviate thepoverty of the inhabitants without harmingthe delicate ecology.

Increasing the numbers of tourists visitingthe Amazon is thought to be the answer. Itwill give the people there a better livelihoodthan the destructive habits of the past,while extending popular knowledge of thebiological and ethnic diversity of the Amazonbasin and its global atmospheric significance.

“Tourism offers a great opportunity forregional economic development with envi-ronmental sustainability and social inclu-sion,” says Francisco Ruiz, secretary-generalof the Amazon Cooperation TreatyOrganization.

Beside the obvious river and jungle explo-rations, numerous events to attract touristsare planned, including cultural and culinary

10 BRAZIL= PROMOTION

Brazil is boosting tourism to save therainforest and showcase the country’swealth of attractions and almostuntouched treasures.

Opening up the

Amazon

festivals, exhibitions and sporting contests.At present, Brazil, which occupies almost

70% of the region, receives fewer than30,000 tourist visitors annually to the twostates that extend into the Amazon basin,Amazonas and Pará.

Indeed, in spite of Brazil’s obvious attrac-tions – glorious beaches along 6,000 milesof coastline, a fascinating indigenous andcolonial heritage, and a wealth of culturaldiversity – the full economic clout of theinternational tourism sector has yet tomake a substantial impact on the country.

The annual number of tourists is lit-tle more than five million, a third of whomhead for Rio de Janeiro, and fewer than amillion visitors are from the U.S.

Although the number of visitors is rela-tively small, Jeanine Pires, president ofEmbratur, the national tourism agency, saysthat visitors stay longer, an average of 18or 19 days, visit more cities and spend moremoney. Its Aquarela tourism plan, intro-duced in 2005, is designed to promote sunand beach holidays, sports, ecotourism, cul-

ture and business tourism and events.Furthermore, new airline routes to

American cities have been opened andUS$1 billion is being devoted to a tourismdevelopment program with the aim ofenabling Brazil to compete to host twomajor sporting events, the World SoccerCup competition and the summer OlympicGames, both in 2014. �

11BRAZIL= PROMOTION

Seeds of GrowthBanco do Nordeste is currently pro-

viding 400,000 small-scale businessfarmers with microcredit facilities andaims to reach a million customerswith funding by 2011.

“We are the largest institution pro-viding microcredit in South America,”says Robert Smith, the bank president.

Although it is charged primarilywith promoting the sustainable devel-opment of the northeast region, thebank has extended its microcreditfacilities to the slums of Rio de Janeiroat the request of President Lula da Silva.

Social responsibility and sustainable devel-opment are key strategic factors in the

management of Brazil’s leading companies.Grupo Orsa, the country’s largest inte-

grated paper and corrugated-cardboard-boxproducer, has created a philanthropic foun-dation through which it is planning majorprojects to fight malaria and conserve theforests in the Amazon Delta.

“In the last ten years, Orsa has investedR$140 million [US$58.7m] in our founda-tion’s activities,” says Sergio AntonioGarcia Amoroso, the Orsa president. Oneof the group’s actions, he says, has been tocreate a company called Orsa Florestal thatwill develop 845,000 hectares of managed

forest over a ten year period, while provid-ing income and improving the health andeducation of the forest dwellers.

“We are already directing a fairly exten-sive program of promotion for Curuaeucalyptus, a long-grain Amazon plantthat can be used to replace plastic,” he says.

Another of Brazil’s flagship institutions,Vale, the world’s second largest mining com-pany, regards sustainable development asits core duty and says it fulfills this by min-ing and processing mineral resources in anenvironmentally responsible manner.

Vale’s petrochemical production isachieved by using technology whose emis-sions are lower than the legal level, eventhough this involves an extra cost of morethan $50 million, says Demian Fiocca, exec-utive director for management and sustain-ability.

Vale’s social responsibility extends beyondits own mining operations. “We don’tmine in China but we have some joint ven-tures there and have been very engaged inhelping the recovery from the recent earth-quake,” says Fiocca. “We have donated $1million to the Red Cross and around$400,000 to a non-government organiza-tion that works with children in the affectedcountryside.” �

ModaFusion, the brainchild of Frenchfashion journalist Nadine Gonzalez andBrazilian designer Andrea Fasanello, isattracting the attention of the interna-tional fashion press. The Franco-Brazilianassociation promotes ethical fashion andshowcases the creativity of women fromthe Brazilian slums.

“We are working with French styliststo transform the language of the favelasinto a fashion design language,” saysGonzalez. “Every year a student fromFrench top fashion schools is chosen todevelop a collection for ModaFusion”

Carla Bruni, the wife of PresidentSarkozy of France, is a patron and wearsModaFusion clothes, while stylists whohave worked for the association have goneon to work for luxury brands such as JeanPaul Gauthier Couture and Celine.

ModaFusion’s 2009 summer collectionfeatures dresses made of knitted fabricsderived from bamboo fiber and otherscreated from recycled plastic.�

Fashion Forward

How companies with ethicalpolicies help communities andprotect the environment

Brazil’s Business Benefactors

These two pages were prepared specifically for this reprint and did not appear in Forbes magazine

12 BRAZIL= PROMOTION

As Brasilia approaches its first halfcentury, the city governor sets outhis plans to inject new life into thecapital.

Brasilia, the capital of Brazil and anUNESCO World Heritage site, is

preparing to celebrate its 50th anniversarynext year.

Futuristic at the time of its creation, thecity, more formally known as the FederalDistrict, is now undergoing a massivetransformation under the direction of itsreformist governor, José Roberto Arruda.

The government invested a sum of $436.5million last year and is spending a further$873.1 million this year. More than a thou-sand public works have either been com-pleted or are under construction. The cityis installing a light rail network at a cost of$550 million and upgrading the road system.

The government is also making improve-ments to the infrastructure of poorer areasand undertaking projects in the education,health and safety sectors. “We are invest-

ing to improve life in the city,” saysArruda.

After his appointment in 2007, thenew governor imposed a major shake-up of the federal district and itsadministration. He reduced the num-ber of government departments from38 to 16, cut staff by half to 8,000 andtransferred the administrative head-quarters from the city center toTaguatinga, the biggest of the federaldistrict’s 18 satellite cities, shaving mil-lions of reals off the federal district’s

budget in the process.When Lucio Costa and Oscar Niemeyer

created it in the 1950s, Brasilia quicklybecame an icon of architecture and urbanplanning. But it was designed in an agebefore traffic jams and for a population ofjust a half million. Today, it has a popula-tion of 2.5 million, plus several thousandvisitors a year from the U.S. alone.

“Our biggest problem is that the city hasgrown over the last 20 years in an undis-ciplined manner,” says Arruda.

His reforms are reinstituting disciplinedgrowth and attracting investment by reduc-ing and simplifying taxes and creating afavorable environment for enterprise. �

Rebirth ofA Supercity

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