News from Brazil

Archive for October, 2010|Monthly archive page

Politics & Government

In Brazil on October 29, 2010 at 9:29 am

DILMA ROUSSEFF IS BRAZIL’S NEXT PRESIDENT

(Nov 1st) Dilma Rousseff has convincingly won the second round of Brazil’s presidential elections, beating Jose Serra with 56% against 44%.

Votes were also cast for the election of governors in those states that failed to show clear winners three weeks ago. The PT’s Agnelo took the Federal District of Brasilia, the country’s capital, with over 66% of the votes, bringing the total of PT governors to (just) three. In both Para, Goias and three other states the opposition PSDB’s candidates won their governorships on Sunday night.

The second round of the Presidential elections showed a high abstention rate of 21%, in a country that has compulsory voting. Dilma won convincingly (56%) and consistently, scoring well in most states, even in the Southeast. A good overview of the voting in the second round can be found at Globo or Folha (with results per municipality).

Was it the high abstention rate that gave her victory or was it the “total campaign” by a plethora of sectors from society? Or a combination of both?

Mrs Rousseff still needs to work with her allies in both chambers of parliament and with a number of allied PSB and PMDB governors. By no means did the PT gain complete control of the country. And a lot of important states elected opposition PSDB or DEM governors. Mrs Rousseff will indeed have to be the President of all Brazilians, as she has stated, or at least of as many as possible.

ELECTIONS

Green Party presidential candidate Marina Silva last week decided to abstain from endorsing either of the second round candidates. This deft decision provides tacit support for Dilma, but without any of the political benefits to her new political party, her voters and supporters, or the nation as a whole. Marina’s decision may prove to be the biggest loss of all (Mark S. Langevin in Brazzil).

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INTERNATIONAL

Brazilian electors will be able to vote in 2012 to directly elect their first representatives in the Mercosul Parliament (Parlasul) (Senado Federal).

The Economist Intelligence Unit is predicting that in 2011 Brazil would move ahead of Italy into seventh place in the ranking of the largest world economies with a GDP of US$2 billion.

Brazil’s Finance Minister Guido Mantega will propose at the Group of 20 nations meeting next month that the International Monetary Fund create an index measuring currency manipulation (Reuters).

Brazil has reduced its greenhouse gas emissions by at least 34 percent over the past five years and virtually met its 2020 target, the government said a month before global climate talks begin in Mexico (Reuters).

Colombian President Juan Manuel Santos said that both China and Brazil were eyeing investments in the Andean nation’s coal infrastructure (railway and port) to gain more access to the material (Reuters).

SINODEPENDENCY

China may not matter quite as much as you think. The country is now the biggest export market for countries as far afield as Brazil (accounting for 12.5% of Brazilian exports in 2009), South Africa (10.3%), Japan (18.9%) and Australia (21.8%). But exports are only one component of GDP. In most economies of any size, domestic spending matters more. Thus exports to China are only 3.4% of GDP in Australia, 2.2% in Japan, 2% in South Africa and 1.2% in Brazil (The Economist).

DEFENCE

Brazil rejects any interference of the North Atlantic Treaty Organization, NATO, in the South Atlantic or any idea of a similar organization at South Atlantic level, “O Estado de Sao Paulo” reported (Mercopress).

As Brazil emerges as a big 21st-century economy, it is developing military muscle commensurate with its expanding influence – spending billions to acquire not only cutting-edge defense hardware but also the know-how to build its own. The country’s next president will oversee much of that development (Defense News).

SPLIT SECOND POLL

RESEARCH

Canada and Brazil will enhance academic mobility and scientific cooperation under a memorandum of understanding (MOU). The MOU will provide opportunities for research collaboration, student exchanges, short-term awards and other activities involving the two countries’ academic communities (Xinhua).

The Stem Cell Research Center of the National Cell Therapy NetWork was inaugurated with support of the BNDES, Brazil’s national investment bank. PUC/PR’s Center will develop technologies for cultivating and handling adult stem cells and will make these cells available to the RNTC for research. The Center meets the standards of Good Manufacturing Practices (GMP), and the cells produced may already be applied to preclinical (animal) and clinical (human) studies (BNDES).

Business & Economy

In Brazil on October 29, 2010 at 9:29 am

ECONOMY

Despite the strong expansion in China in recent years, Brazil leads the ranking of most internationalized economy of BRIC countries. Until last year, the stock of foreign direct investment (FDI), which includes all that entered the country over time, totaled 25% of Gross Domestic Product (GDP) – above the numbers of Russia, 21% of India , 13% and China 10% (India-Brazil Chamber).

If you want to know what living with hyperinflation in Brazil used to be like, an arcane system still used in many of the country’s smaller record shops provides a clue. In place of a price-tag, each of the CDs on display in the racks has a small, round label attached. These come in a variety of colours (BBC).

Brazil’s finance minister praised progress by the Group of 20 economies on global currency issues and ruled out a new capital gains tax on foreign holdings of local bonds to curb a domestic currency rally (Reuters).

BANKING & FINANCE

Santander Brasil, Brazil’s third-largest non-government bank, forecasts its credit portfolio could grow about 18 percent in 2011, Chief Financial Officer Carlos Lopez Galan said (Reuters).

JPMorgan Chase & Co said it acquired a majority stake in Brazilian hedge fund and private equity firm Gavea Investimentos, joining a wave of foreign financial firms betting on one of the world’s fastest-growing economies (Reuters).

Australian oil and gas explorer Karoon Gas Ltd said that it could raise up to 1.77 billion reais ($1.04 billion) in an initial public offering of its South American unit in Brazil (Reuters).

Odebrecht SA’s oil and gas unit hired banks to sell as much as $1.5 billion in 10-year bonds, the biggest Brazilian debt offering in a year (Bloomberg).

Foreign investors will scrutinize Brazil more intensely because of the government’s use of state-run lenders and the $70 billion capital injection in oil company Petrobras, financier and former Central Bank President Arminio Fraga said (Reuters).

AVIATION

With Rio’s Galeão International Airport increasingly becoming a direct destination and a new hub for Brazil following the lead of São Paulo’s Guarulhos International, the airports are currently forced to handle flights and passengers well above their capacity. This has led to airlines having to offer direct flights to other major destinations in Brazil such as Salvador, Recife, Manaus, Brasília, and Fortaleza to reduce the burden on São Paulo and Rio (The Rio Times).

Embraer has signed a contract with Fuji Dream Airlines (FDA) of Japan for the sale of an EMBRAER 175, which is the fifth E-Jet in the airline’s fleet. The new aircraft will be configured in a single class with 84 seats. The order also includes an option for one additional aircraft of the same model (Embraer, pdf).

Embraer, the world’s largest maker of regional aircraft, reported third-quarter net income of $98.5 million, compared with $58 million a year earlier (Reuters).

BIOFUELS

Biofuels are back. This time they might even work. Read the analysis about this new post-alcohol world at The Economist.

The Indian giant Shree Renuka Sugars works to transform its plants in India in a major center for refining sugar for re-export it to the major consuming regions, such as the Middle East and Southeast Asia. In the process, Brazil would be the leading supplier of raw sugar (India-Brazil Chamber).

Petrobras said it signed a 2.1 billion-real ($1.23 billion) agreement with Tereos International to secure the supply of ethanol (Reuters).

CONSTRUCTION

Odebrecht and a Spanish construction consortium will build Panama City’s first subway after submitting a plan that will cost less than Panama’s government had anticipated (Reuters).

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OIL & GAS

After being delayed by the BP oil spill this summer, Petrobras is finally closing in on the launch of a major offshore oil and gas project in the deep waters of the Gulf of Mexico, its biggest ever in the U.S. (Chron).

British energy company BG Group Plc said it had begun production from Tupi, one of its key fields, in the Santos basin off the coast of Brazil (Reuters).

An offshore oil field may hold the biggest crude discovery in the Americas in more than three decades. The Libra field in the Santos Basin off the coast of southeastern Brazil may have 7.9 billion to 16 billion barrels of oil (Bloomberg).

Petrobras said that drilling off the coast of Sergipe state in the northeast turned up signs of a large deposit of light oil (Reuters).

In partnership with vessel owners Greatship and Farstad, Fugro Brasil has been awarded 3 long-term contracts for ROV Support Vessels by Petrobras (Fugro).

HRT Participacoes em Petroleo SA aims to be Brazil’s largest private oil and gas company in five years, Chief Executive Officer Marcio Rocha Mello said (Bloomberg).

MINING

Vale, the world’s top iron ore producer, will invest a record $24 billion in 2011 as it diversifies toward pricier metals and profitable fertilizers (Reuters).

Vale denied reports that board members discussed replacing Chief Executive Roger Agnelli (Reuters).

SHIPPING

Shipments of bagged sugar from Brazil’s port of Santos are facing delays due to a work slowdown since Oct. 25, shipping agency Williams said (Reuters).

Coffee exports too are facing delays as the container terminals at the country’s largest port clog up, exporters said, slowing deliveries to a market already jittery over tight supplies (Reuters).

Culture & Regional

In Brazil on October 29, 2010 at 9:29 am

BUILDING OF THE WEEK

Partial render of the Infinity Tower for Sao Paulo (source: Skyscrapercity). More renders can be found here.

CULTURE

Instituto Cultural Inhotim is a unique site in the town of Brumadinho, 60kms out of Belo Horizonte, MG. Inhotim offers a broad ensemble of art works, displayed outdoors as well as in both temporary and permanent galleries, all located inside a Botanical Garden of extraordinary beauty. The landscaping was originally inspired by famed architect and landscape artist Roberto Burle Marx (1909-1994), and rare plant species are distributed in an esthetically pleasing manner throughout an estate which also sports five lakes and a preserved forest area (Inhotim).

FILM

From October 28th to November 7th, Rio once again becomes a center point of cinema. This time, long features have given way to a shorter format with the twentieth edition of the Festival Internacional de Curtas de Rio do Janeiro – Curtas Cinema, Rio’s international short film festival (The Rio Times).

MEDIA

As African broadcasters prepare to migrate from analog to digital TV, the Brazilian government has been lobbying countries to drop the North American digital standard for its South American rival (Variety).

The Portuguese group Ongoing Strategy Investments SGPS SA may pay $1 billion to buy or to associate with Rede TV!, a Brazilian TV network (Bloomberg).

AMAZON

Brazilian President Luiz Inacio Lula da Silva said that Brazil would fulfill its deforestation reduction commitment four years earlier than expected. “We will reduce the deforestation by 80 percent by 2016. No country will give such a large contribution to the planet as Brazil,” Lula said (Xinhua).

The worst drought in decades in the Amazon has seen a major river fall to its lowest level since records began in 1902, Brazilian officials say (BBC).

Scientists searching the Amazon have discovered new species – creatures such as a baldheaded parrot, a blue-fanged tarantula and a bright red catfish – at the rate of about one every three days for the past 10 years, the World Wildlife Fund reported (Miami Herald).

AGUA PRETA

People in the Brazilian town of Agua Preta are used to coping with the elements. But nothing could prepare them for events in June when the River Una, which flows through the town, burst its banks after days of heavy rain and began to flood the streets (BBC).

SPLIT SECOND POLL

BUZIOS

A two-hour drive beyond the lakes region to the east of Rio lies Buzios, the charming fishing village-turned-fashionable holiday destination following its ‘discovery’ by the actress Brigitte Bardot in the 1960s. Since then the region has been completely transformed with beach houses, condos and a wealth of pousadas popping up in droves, providing a healthy construction industry and fluid real estate market, with prices kept comparatively affordable by the quantity available (The Rio Times).

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NATAL

The Rio Times this week heads to Natal, capital city of Rio Grande do Norte, as part of  its tour of Brazilian cities set to play host for thousands of football fans during the 2014 World Cup (The Rio Times).

RIO

After being hidden for four months behind the scaffolds used in its restoration, the statue of Christ the Redeemer is once more part of the city’s landscape – a shade lighter, brighter and even more beautiful (Rio Official Guide).

Government officials have provisionally slated the pacification peacekeeping mission in Rocinha for January 2011, though police forces charged with the operation do not, it seems, expect it to happen before March. Meanwhile the inhabitants of Rocinha, Rio’s biggest favela and a city within a city, are concerned about an uncertain future (The Rio Times).

Famous for its lively bohemian and artistic vibe, Santa Teresa has recently become more and more popular amongst tourists both from Brazil and abroad. The Rio Times provides a few tips on how to enjoy a three day weekend in the ‘Brazilian Montmartre’.

Politics & Government

In Brazil on October 22, 2010 at 9:38 am

ELECTIONS

After months in which even his fellow party members had given him up for lost, José Serra, the runner-up in the first round of Brazil’s presidential election, now looks as if he has a slim chance (The Economist).

But Rousseff extended her lead over opposition challenger Jose Serra again to 10 percentage points in a new opinion poll released today. It was the third poll this week to show her gaining ground after a rough few weeks in which a re-energized Serra narrowed the gap (Reuters).

How much credence should Brazilians be giving to opinion polls? The last few polls have put Ms Rousseff on between 53% and 57%, a big difference in a two-horse race (she is facing José Serra of the centrist Party of Brazilian Social Democracy). Those figures can’t both be right. Are either of them? Read on at The Economist.

Marina Silva, the defeated Green Party candidate in Brazil’s presidential election has said she will remain neutral before the second round run-off vote on 31 October (BBC).

Brazilian presidential candidate Jose Serra was hit on the head by an object while out campaigning in Rio de Janeiro at an election rally (BBC).

Brazilian presidential frontrunner Dilma Rousseff and her opponent Jose Serra clashed over privatization while making no mention of abortion in their second head-to-head debate (Businessweek).

The unexpectedly close battle in Brazil’s presidential election has heightened investor unease and threatens to fuel financial market volatility in Latin America’s largest economy. Read the key political risks to watch in Brazil according to Reuters.

Serra is still leading among the voters in Brazil Weekly’s own reader poll:

POLITICS

The return of Itamar Franco, as of January, by the PSB from Minas Gerais, will bring to the Senate, as of 2011, three former presidents of the Republic. Senators José Sarney (PMDB-AP), Fernando Collor (PTB-AL) and Itamar Franco share the condition of having, as presidents, endorsed the most radical economic plans destined to restore economic stability to a country hit by a galloping inflation in the 80s  (Senado Federal).

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INTERNATIONAL

Governments are increasingly taking the economic value of nature into account in policy-making, with growing interest in results from a UN-backed analysis. The Brazilian and Indian governments are among those keen to use findings from The Economics of Ecosystems and Biodiversity (Teeb) project (BBC).

Several South American countries from the Mercosur trade bloc have officially complained to the UK over planned Falkland Islands military exercises. Brazil, Uruguay and Paraguay joined protests from Argentina, which lays claim to what it calls the Malvinas (BBC).

This year Brazil has emerged as Chile’s largest trading partner in South America and one of the most important destinations for Chile’s investment. Overall, trade between Brazil and Chile has grown 66%, while Brazil replaced Colombia as second highest location for Chilean Investment (Mercopress).

Brazil’s top economic officials will not be attending meetings of the G20 finance ministers and central bank governors in South Korea this week, the finance ministry and central bank press offices said (Reuters).

Brazil is seeking a partnership with Argentina and other South American producers of grains and oilseeds to deal jointly with buyers in Asia and elsewhere, according to Brazilian Agriculture Minister Wagner Rossi (Bloomberg).

DEFENCE & SECURITY

One disturbing issue has been largely overlooked by both domestic and international commentators during the election campaign: Since 2004, Brazil has refused to grant inspectors from the International Atomic Energy Agency (IAEA), the U.N.’s nuclear watchdog, full access to its nuclear facilities, in violation of Brasilia’s obligations under the Non-Proliferation Treaty (NPT). Read the analysis by Oliver Stuenkel.

For decades successive Brazilian governments have taken great efforts to find hydrocarbons, lower oil imports, and develop a national market for sugarcane based ethanol as a transportation fuel substitute. Today, Brazil’s new-found hydrocarbon bonanza promises to rapidly increase oil and gas production, fuel a national drive toward economic and social development, and swell the country’s geopolitical weight around the world. Read about Brazil’s “Big Oil Play” and “How This Nation is Charting National Energy Security” in the Journal of Energy Security.

Top level officers from Colombia, Peru and Brazil met to discuss security issues. During a meeting in Leticia in Colombia’s Amazonas department, military officers from the three countries discussed the nuclear agreement signed between Venezuela and Russia, as well as the problem of guerillas in their territories (Xinhua).

Business & Economy

In Brazil on October 22, 2010 at 9:38 am

ECONOMY

China’s surprise decision to raise interest rates was a move “in the right direction” and could help ease pressure on Brazil’s currency, Finance Minister Guido Mantega said (Reuters).

Brazil registered a record-high federal taxes collection of 573.6 billion reais (340 billion U.S.dollars) in the first nine months of 2010, up 13.1 percent from the same period in 2009, the country’s Federal Revenues Secretariat announced (Xinhua).

Economists in a weekly central bank survey raised for a fifth straight week their forecasts for Brazil’s benchmark inflation index in 2010, to 5,2 %, the bank said (Reuters).

Ruling party candidate Dilma Rousseff would run an “austere” government if she wins Brazil’s presidential election while also aiming to raise public investment, Planning Minister Paulo Bernardo told Reuters.

Brazil’s unemployment rate fell to 6.2 percent from 6.7 percent in August, the national statistics agency said (Bloomberg).

Registered formal jobs in Brazil reached a record high of 2.2 million in the first nine months of 2010, up 136 percent year on year, the country’s Labor Ministry said (Xinhua).

AGRI, SUGAR & ETHANOL

Some of Brazil’s main sugar and ethanol groups see a possible drop in cane and sugar output in the coming crop as a result of below-average rainfall in recent months and low investments in cane replanting (Reuters).

Coffee output in Brazil, the world’s biggest producer, may be lower than expected next year as growers prune trees to improve productivity and the plants enter a lower yielding cycle (Bloomberg).

Glencore may acquire 70 percent of the Rio Vermelho mill, in a deal that could be concluded in November, Claudio Piquet, a director for the company, said (Bloomberg).

AUTOMOTIVE

Fiat will invest 10 billion reais ($6 billion) in Brazil by 2015 in operations that include production of cars, auto parts and agricultural machinery (Reuters).

BANKING

Swiss bank UBS, which has expanded in Brazil in recent months, hired veteran banker Lywal Salles as its chairman in that country, as part of a push to rebuild its operations in one of the world’s fastest-growing financial markets (Reuters).

Qatar is to take a 5 percent stake in the Brazilian unit of Spanish lender Banco Santander, with a $2.7 billion investment that adds to its big bank deals in recent years (Reuters).

AVIATION

Embraer and NetJets, Inc., have signed a Chasseur Agreement for 50 Phenom 300 executive jets, plus 75 options. The total value of the deal may exceed US$ 1 billion, at current list price (Embraer, pdf).

Embraer is buying into BAE Systems’ advanced avionics to upgrade its aircraft’s performance as it expands a global customer base. The deal with BAE Systems gives Embraer access to BAE’s advanced flight control technologies for its aircraft (UPI).

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MINING

Brazil’s government will likely wait at least until the next administration takes office in 2011 before changing a mining law and discussing a possible royalty hike, a government official told Reuters.

Vale will need $26 billion to $28 billion over the next two years to complete projects it has already started with a priority on copper and fertilizer investments, the company’s CEO said (Reuters).

Brazil’s ruling Workers’ Party (PT) has denied allegations that some of its officials pressured mining giant Vale for jobs, O Globo newspaper reported (Reuters).

Vale may become the largest nickel producer by next year as it begins output at new projects in Brazil and New Caledonia, Chief Executive Officer Roger Agnelli said (Bloomberg).

OIL & GAS

Odebrecht said its oil and gas division has received a $400 million investment from Singapore state investor Temasek. “This represents the most important step in the growth of OOG,” the company said in a press release, referring to Odebrecht Oleo e Gas (Reuters).

RETAIL

Chile’s Cencosud, one of Latin America’s biggest retailers, said it had clinched a deal to buy Brazilian supermarket chain Bretas for 1.35 billion reais, or about $813 million (Reuters).

SHIPPING

STX Pan Ocean said it had won a 25-year shipping contract from Brazil’s Fibria, the world’s largest supplier of pulp to paper makers. The contract is valued at 5.6 trillion won ($5.02 billion), it said in a filing with the Korea Exchange (Reuters).

Sugar loading at Brazil’s two main ports is accelerating and reducing a backlog by half as dry weather allows vessels to speed up shipments. Ships waiting to load at the ports of Santos and Paranagua, Brazil’s first and second largest, fell to 68 today from a record backlog of 135 in August, according to research firm Santos Associados Consultoria Ltda. and shipping agency Unimar Agenciamentos Maritimos (Bloomberg).

Culture & Regional

In Brazil on October 22, 2010 at 9:37 am

BUILDING OF THE WEEK

This week something different:  a social housing project in Planalto, Natal, RN, currently under constuction (Orbis Property)

FILM

“Carmo, Hit the Road,” a picaresque romance set (and filmed) in Brazil’s wild west on the borders of Paraguay and Bolivia, rambles through some beautiful jungle-and-river landscapes without really going anywhere. It’s not a memorable ride, but there’s enough rueful humor, tropical sensuality and borrowed style along the way to make it pleasant (The New York Times). You can also watch the trailer.

TRAVEL

Arraial do Cabo is a sleepy fishing town located a few hours (158km) east of Rio. Along with Búzios and Cabo Frio, Arraial do Cabo forms part of the the ‘Região dos Lagos’, a popular destination for tourists looking to escape the rush of the city. While Búzios prides itself on glamor, Arraial do Cabo has declared itself Rio’s scuba capital (The Rio Times).

MANAUS

The Rio Times looks north, this time, to the state of Amazonas this week in the series on Brazil’s 2014 World Cup’s cities, and more specifically the capital Manaus, which will see matches leading to the biggest prize in sport contested there in three and a half years time (The Rio Times).

RIO GRANDE

Petrobras inaugurated the Rio Grande Naval Pole (Rio Grande do Sul). The Pole consists of a 430,000 square meter infrastructure designed for the construction and repair of offshore units for the oil industry, such as floating drilling, production, and support platforms. The new structure will increase bidding competitiveness with the entry of new businesses, enabling future project price and term reductions (Petrobras).

SPLIT SECOND POLL

RIO

In somewhat of an unpublicized process, the Rio Prefeitura is currently constructing an exclusive ecological park area at the top of Rocinha. To add to the mystery, the road to the park is apparently going to be shielded from the favela by a wall (The Rio Times).

The Lagoa Rodrigo de Freitas was the target of a blitz against dangerously poor hygiene in restaurants, with police closing several of the popular outlets around the lake’s perimeter and once again bringing the hygiene practices of some of Rio’s more high-profile restaurants and neighborhoods into focus (The Rio Times).

As summer approaches, accommodation in the city becomes scarce and expensive, leaving the traveler to ponder if it is worth venturing to less obvious locations in search of a place to stay. With the Brazilian Real getting stronger, downtown, or Centro, with its lower prices and better availability, is becoming an increasingly viable alternative (The Rio Times).

SAO PAULO

The New York Times goes house hunting in Sao Paulo. Check out their story.

SPLIT SECOND POLL

Politics & Government

In Brazil on October 15, 2010 at 9:44 am

ELECTIONS

Brazil’s presidential race narrowed to a statistical dead heat in a new poll on Thursday, causing investors to react for the first time in months to the possibility of a victory by opposition candidate Jose Serra (Reuters).

As Brazil gears up for the second round of its presidential election in two week’s time, a key role is being played by a candidate no longer on the ballot paper: Marina Silva (BBC).

Brazilian presidential candidates Dilma Rousseff and Jose Serra have clashed in a TV debate as they gear up for the second round vote on 31 October. Mr Serra from the Social Democratic Party accused Ms Rousseff of being two-faced and incoherent on moral issues. Ms Rousseff, the governing Workers’ Party candidate, accused the Serra campaign of spreading lies about her (BBC).

The Catholic Church has actively joined the Brazilian presidential campaign. Conservative Archbishop Aldo Pagotto of Paraiba accused Brazil’s Workers’ Party of “misinformation and manipulation of consciences” in an effort to win the upcoming presidential run-off election, slated for Oct. 31 (MercoPress).

When analyzing the elections results during her speech at the Plenary, senator Marisa Serrano (PSDB-MS) said neither the opposition parties nor the government base’s parties managed to score a victory in these elections. In her opinion, the Brazilian electorate opted for the balance of forces, without privileging the government or the opposition (Senado Federal).

Brazilian presidential candidate Jose Serra said he would “strengthen” Petroleo Brasileiro SA, Banco do Brasil SA and the state-run development bank BNDES if elected (Bloomberg).

Serra is surely leading in Brazil Weekly’s poll among you, our readers and Brazil experts:

FOREIGN AFFAIRS

There are certainly some striking similarities between Russia and Brazil.  Both continental countries and self-declared regional leaders, Russia and Brazil are extremely rich in natural resources, a characteristic that makes them important suppliers to China. While China has helped them weather the recent recession, both Russia (oil, gas) and Brazil (soy, iron ore) will need to be extremely careful not to enter in an unequal relationship with China, which buys up natural resources and sells value-added products in return. Oliver Stuenkel wonders if there is a case for stronger Russia-Brazil relations.

From currency battles to computerized corporate espionage, fractious international conferences to a new scramble for Africa, “great power politics” is back on the map. The growing power of emerging economies — particularly China, Russia, India and Brazil — is redrawing the priorities of foreign and defense ministries, driving financial markets and reshaping the global business environment (Reuters).

U.S. monetary stimulus and not the accumulation of reserves by emerging nations is creating the biggest imbalance in world economies, Brazil’s Central Bank President Henrique Meirelles said (Bloomberg).

SPLIT SECOND POLL

DEFENCE

Senator Papaléo Paes (PSDB-AP) stressed the importance of the implementation of a National Defense Strategy (NDS) for the Amazon. In his opinion, the measure would stimulate the region’s development, thus driving away the international greed on its biodiversity, mineral and water resources, as well as its energy wealth (Senado Federal).

Brazil is going to wait until after presidential elections conclude at the end of this month to decide a long-delayed multi-billion-dollar purchase of new fighter jets, Defense Minister Nelson Jobim said. Outgoing President Luiz Inacio Lula da Silva needs to discuss the matter with whoever is elected to succeed him in an October 31 runoff (DefenseNews).

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SOCIAL

Brazil’s population will grow until 2030 and then start falling, a study released by the Institute of Applied Economic Research (IPEA) said (Xinhua).

Business & Economy

In Brazil on October 15, 2010 at 9:43 am

ECONOMY

Brazil’s economy may expand 7.5 percent this year, up from a previous forecast of 7 percent, as domestic demand ensures non-inflationary growth in coming years, Finance Minister Guido Mantega said (Bloomberg).

Brazil’s currency has continued to rally. After soaring more than 100 percent since President Luiz Inacio Lula da Silva took office in 2003, the real is now the most overvalued major currency in the world, according to Goldman Sachs (Reuters).

The combination of abundant access to international capital by large domestic firms, increasing interest of foreigners in Brazil and consolidation in various sectors of the economy made the market for mergers and acquisitions within the country experience strong growth in the year through September (India-Brazil Chamber).

Brazil’s state development bank BNDES and the government are preparing measures to promote long-term credit in the private sector, the bank’s president Luciano Coutinho said (Reuters).

Economists forecast the benchmark IPCA inflation index at 5.15 percent for 2010, compared with the 5.07 percent rate the previous week (Reuters).

Brazil’s retail sales rose more than expected in August from a month earlier, fueled by record low unemployment and credit expansion. Sales rose 2.0 percent in August from July (Bloomberg).

AGRI

Brazil’s agricultural exports reached record-high levels in the last 12 months, mainly due to growth in sugar and meat exports, the Agriculture Ministry said (Xinhua).

AVIATION

Embraer and Air Lease Corp., a newly formed aircraft leasing, purchasing and financing provider company have signed the final agreement for the acquisition of 15 EMBRAER 190 jets. First delivery is scheduled to take place in June 2011 (Embraer, pdf).

Brazil remains hopeful that Beijing will give aeronautics firm Embraer the nod to build bigger passenger planes in China, the office of President Luiz Inacio Lula da Silva said (France24).

The Ministry of Defence of Angola is negotiating with the Brazilian aircraft manufacturer Embraer for the purchase of six reconnaissance Super Tucano planes (Atlantico Weekly).

BANKING

Banco Santander Brasil SA expects its revenue growth to beat that of Itau Unibanco Holding SA and Banco Bradesco SA this year and in 2011 as it expands retail services such as credit cards, as well as investment banking, said Vice-President for Finance Carlos Lopez Galan (Bloomberg).

ETHANOL

Danish industrial enzymes producer Novozymes said it would work with Brazil’s Petrobras to develop new ways of producing advanced bioethanol from sugarcane bagasse (Reuters).

Brazil’s ethanol production will continue to grow and will be a source of an increase in oil supply outside the Organization of the Petroleum Exporting Countries, the International Energy Agency (IEA) said (Reuters).

ENERGY

China’s State Grid utility company is in talks with Brazil state-controlled utility Centrais Eletricas Brasileiras, or Eletrobras, to build generating capacity, Estado de S. Paulo newspaper reported (WSJ).

MINING

Vale, through its joint-venture with African Rainbow Minerals (ARM), officially launched the US$ 400 million Konkola North Copper Project, located in the Chililabombwe district, Copperbelt province, Zambia. The estimated nominal capacity of the project, which is expected to reach full potential in 2015, is 45,000 metric tons per year of copper in concentrates. Construction work started in August 2010 and the first copper ore extraction is scheduled for 2013 (Vale).

Norsk Hydro ASA, Europe’s third- largest aluminum maker, is considering expansion in Brazil and Argentina after it completes the purchase of $4.9 billion of assets from Vale SA (Bloomberg).

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COSMETICS

After its initial launch in Delhi, Surya Brasil products are now available in the metros. “Besides Big Bazzar, we are also moving to smaller towns and cities”, says Fernanda Drumond, whose mandate is to take the product pan India (India-Brazil Chamber).

FERTILIZER

The Brazilian government has tried to boost the country’s self-sufficiency in fertilizer production for years as a matter of national security, and industry players said a protective tariff may be needed to boost local capacity that only meets a third of farmers’ needs (Reuters).

OIL & GAS

Brazilian oil and gas start-up OGX  has increased the number of wells it plans to drill in Brazil by 2013 to 87 from 51 (Reuters).

Petrobras said it may cut the price it charges for natural gas because of an increase in supply from the pre-salt crude oil fields (Bloomberg).

Culture & Regional

In Brazil on October 15, 2010 at 9:42 am

BUILDING OF THE WEEK

Render of the Gloria Palace Hotel in Rio, under major reconstruction presently (more here).

FILM

Following months of teasers, Tropa de Elite 2 (Elite Squad 2), the sequel to the controversial and wildly popular Tropa de Elite finally opened in Brazil, attracting record crowds of 1.25 million to theaters on the first weekend making it the fifth biggest opening in Brazil of all time (The Rio Times).

Tight security may be the most important part of director Jose Padilha and his Zazen Productions’ plan to self-distribute “Elite Squad 2,” which debuted on 696 screens in Brazil — making it the widest national release ever (Reuters).

MEDIA

A large-scale research project, looking at online behaviour around the globe, found out that digital sources are overtaking TV, radio and newspapers as the media channel of choice for 61% of the online population around the world. Brazil scores very well at second place in online friendships. In Malaysia the average number of friends is 233, closely followed by 231 in Brazil and 217 in Norway (BBC).

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AMAZON

Brazil will auction large swaths of the Amazon forest to be managed by private timber companies and cooperatives to help reduce demand for illegal logging (Reuters).

It is only a small pilot project, but its leaders say the microchip system has the potential to be a big step forward in the battle to protect the Amazon. The chips allow land owners using sustainable forestry practices to distinguish their wood from that acquired through illegal logging that each year destroys swathes of the forest (Reuters).

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RIO

One of the popular outgoing president Lula’s last initiatives in office was to launch the new program Rio Top Tours – Rio de Janeiro from a new perspective. Lula recently visited the favela Dona Marta, to inaugurate the project, a pacified favela that, with the presidential visit, symbolized a new safety for the area and the first step on the way to big changes for the community (The Rio Times).

Brazil’s development bank, known as BNDES, approved 400 million reais in financing to Maracana stadium (Bloomberg).

Rio officials have embarked on an ambitious plan to wrest control of the slums, or favelas, from ruthless drug gangs who ruled for years with big guns and abject terror (The New York Times).

Besides the glitz and the glamor, samba is a serious business and as the end of the year approaches, the city’s samba schools are getting into full gear with preparations for the Carnival Parade. Rehearsals have already begun in earnest at their respective samba courts or quadras and this month many are deciding which Samba-enredo (theme tune) is going to be sung at the Sambódromo in Sapucaí Avenue (The Rio Times).

When it comes to naming the most fashionable neighborhoods in the city, there are few that would utter the word ‘Catete’ in any such discussions. Perched on the back of Gloria, along from Largo do Machado and squeezed in between favela-strewn hillside and the thundering main road of the Aterro, on the surface there aren’t any immediately obvious redeeming features (The Rio Times).

SALVADOR

The Rio Times looks north to the state of Bahia this week in the series on Brazil’s World Cup 2014 host cities, and more specifically the capital Salvador, which will see matches leading to the biggest prize in sport contested there in three and a half years time (The Rio Times).

Politics & Government

In Brazil on October 8, 2010 at 10:22 am

ELECTIONS

Three more weeks of campaigning lie ahead but, despite a surprising last-minute stumble, Dilma Rousseff (pictured) is still likely to become the next president (The Economist).

In the races for state governor and federal and state legislatures, a total of 11m votes went to ineligible candidates. In the northern state of Pará, for example, two of the three front-runners for the national Senate were blacklisted. However, politicians can appeal against their inclusion on the list (The Economist).

Ms Rousseff still will have to produce a detailed governing plan, and manage an unwieldy multi-party coalition as well as factions in her own PT. All of this will challenge her largely untested political skills (Economist Intelligence Unit).

The Federal Senate emerges from the 2010 elections with a renewal hardly ever seen before. Traditional politicians of the opposition to Lula’s administration will not be back to the Senate for the period starting in 2011. On the other hand, candidates whose victories were not predicted by the research institutes got their seat at the Senate (Senado Federal).

See the full overview of seats in the new senate at Senado Federal and meet the new senators here.

Voters the world over complain about having clowns for politicians, but Brazilians embraced the idea on Sunday by sending a real one to Congress with more votes than any other candidate (Reuters).

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POLITICS

Lula gave Brazil continuity and stability. Now he needs to give his successor independence (The Economist).

Incumbent President Luiz Inacio Lula da Silva said that he plans to leave national politics alone once he steps down in January. Lula said he is going to live and participate in politics in Sao Bernardo do Campo (Xinhua).

FOREIGN AFFAIRS

Brazil’s economic rise over the past decade has been nothing short of astonishing. While Brazil’s growth has not been as impressive as that in the other BRIC countries (Russia, India and China), Brazil’s key advantage over the other emerging powers is that the international strategic threats it faces are fewer and less dangerous. This does not mean that Brazil faces no threats at all: drug-trafficking, arms smuggling and guerrilla activity in a lawless frontier region in the Amazon are probably the most potent security threats Brazil faces from abroad. Read the article by Oliver Stuenkel (Pdf).

In spite of the upswing in their country’s fortunes under President Lula da Silva, many Brazilians continue to leave their home in search of a better life in the United States. Yet Mexico’s drug war represents a dangerous hurdle in the path of many illegal migrants (Der Spiegel).

Poland, Brazil and the Czech Republic are among 10 developing nations “on their way to graduate to the developed world” because of their fiscal consolidation and reduced reliance on external funding (Bloomberg).

EDUCATION

While Brazil invests twice what most other Latin American countries spend on science and technology — nearly 1.5 percent of its gross national product annually, according to the Brazilian Development Bank (BNDES) — and Brazilian universities produce a Latin American record of 30,000 graduates with master’s degrees and 10,000 with doctorate degrees every year, Brazil’s overall education statistics are generally poor even by regional standards (Miami Herald).

A Brazilian university has been ordered to pay $23,600 (£14,840) to compensate a student who was briefly expelled after she went to class in a dress deemed too short by officials (BBC).

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CLOSED POLL