News from Brazil

Archive for May, 2013|Monthly archive page

Politics & Government News

In Brazil on May 31, 2013 at 11:24 am

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INTERNATIONAL

Numerous company executives and Chinese officials have been to Mato Grosso in recent years exploring the possibility of investing in the state’s logistics such as grain silos, railroads, and ports as a way of reducing transportation costs which can be more than US$ 3.00 a bushel to get the soybeans from the interior of Brazil to one of Brazil’s ports. On a recent tour of the state with the Soybean and Corn Producers Association of Mato Grosso (Aprosoja), a Chinese executive, Lin Tan, expressed his frustration in trying to invest in Mato Grosso’s infrastructure (Soybean & Corn Advisor).

OPINION

Be welcome to check out Brazil Weekly’s interview with Professor Bolivar Lamounier and find out Why you shouldn’t get too excited about Brazil’s new middle class…

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CITY BRIEFS

Check out Brazil Weekly’s new feature City Briefs, a series of introductions to the country’s main economic centers, packed with relevant info for business travelers. First to hit the net were the Brazil Weekly City Briefs on Brasilia, the federal capital of Brazil, Belo Horizonte, the country’s third economic centre and Sao Paulo, the global megacity. Latest City Brief deals with Rio de Janeiro, the Marvelous City!

EDUCATION

Four Brazilian universities were listed among the top ten in Latin America, according to a report released Tuesday by a regional provider of guides to higher education. The University of Sao Paulo is considered the best in Latin America for the third time in a row, according to the 2013 university ranking by the Quacquarelli Symonds (QS) (Xinhua).

OPINION

Be welcome to check out our latest article, a reaction to a recent article in The Economist: Can Brazil Conquer Africa’s Booming Markets?

– THE RISE OF THE PACS –

Meet three booming Portuguese-speaking African Countries…!

The rise of the what? Another acronym, you say? Well, why not… In Portuguese the countries are called PALOPs, the Paises Africanos de Lingua Oficial Portuguesa (or African Countries with Portuguese as Official Language). So we call them PACs. Three PACs have become booming economies and nobody is stopping them: Cape Verde, Angola and Mozambique. Check it out!

 

Business & Economy News

In Brazil on May 31, 2013 at 11:24 am

SPLIT SECOND POLL

ECONOMY

In relation to the fourth quarter of 2012, GDP at market prices posted a positive change of 0.6%, in the seasonally adjusted series. The greatest highlight was agriculture, advancing 9.7%. Services grew 0.5%, whereas the industry fell 0.3%. In comparison with the same period of 2012, there was a 1.9% increase in the GDP in the first quarter of the year. In the cumulative index of the four quarters ended in the second quarter of 2013, the GDP presented a growth of 1.2% in relation to the prior four quarters (IBGE).

Brazil sure does like to keep the market on its toes. After this morning’s disappointing first quarter GDP, the country’s central bank came out with another shocker on Wednesday night. The central bank’s monetary policy committee increased the benchmark Selic rate by 50 basis points to 8 per cent. The market was expecting an increase of 25bps (FT).

The General Price Index – Market (IGP-M) recorded no change in May, compared to 0.15% in April. In May 2012 the rate was 1.02%. The cumulative change rate in 2013, until May, is 0.99%. In 12 months, the IGP-M increased 6.22%. The IGP-M is calculated based on the prices collected between the 21st day of the previous month and 20th day of the reference month (FGV-IBRE).

The Services Confidence Index (SCI) by the Getulio Vargas Foundation continued the downward trend in May, decreasing by 0.7% compared to April, to 119.4 from 120.2 points. Among the 12 sectors surveyed, five showed a decline on the same basis for comparison (FGV-IBRE).

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AUTOMOTIVE

Truck manufactures in Brazil are ramping up production in order to meet the ever increasing demand for trucks to transport Brazil’s record large grain crops. Truck production increased 39% during the most recent trimester and it was the star performer in an otherwise mediocre economic performance. Two thirds of Brazil’s capital investments during the most recent trimester were for increased truck production (Soybean & Corn Advisor).

AVIATION

It’s turning out to be one good week for Brazil-Africa relations. The latest sign of the ever cosier relationship came from Brazil’s budget airline Gol, which said it had received the go-ahead from regulators for three weekly flights to Nigeria (FT).

Brazil will suffer a second airport bottleneck in the 2020s, after the World Cup and the Olympics. Today, the problems are mainly in the boarding terminals. Ten of Brazil’s main airports have such areas saturated.There is also an overloaded runway: in Congonhas airport. A new study by FGV (Getúlio Vargas Fundation) shows the problem will spread. The Viracopos runway is likely to reach its limit by 2020. From then on, the situation will worsen: by 2030, another ten airports in the country’s main capitals will need investments on their runways (Folha).

Azul Linhas Aereas Brasileiras SA, the Brazilian air carrier created by JetBlue Airways Corp. founder David Neeleman, filed with the country’s securities regulator to sell shares in an initial public offering. Azul may raise as much as 1.1 billion reais ($540 million) in a primary offering that should take place in the following two months (Bloomberg).

BANKING & FINANCE

The President of Caixa Econômica Federal, Jorge Hereda, has admitted that the early release of Bolsa Família payments on May 17th was intentional and planned to avoid a systems error whereby up to a million families had been registered twice by mistake, and could have been left without payments (Rio Times).

– NEW EDITION –

BRAZIL WEEKLY’S BRAZIL’S NEXT 10 HOTTEST BUSINESS CITIES

Rodoviária de Londrina - Ft: Milton Dória - 2004

Check out our revised, 2013, edition! No doubt the biggest and most important business centres of Brazil are the megacities of Sao Paulo and Rio de Janeiro and do not forget most other state capitals like Belo Horizonte, Salvador da Bahia, Recife, Fortaleza, Curitiba and Porto Alegre. But Brazil is big and there are plenty of other fast developing cities, not being state capitals. So for a minute forget Sao Paulo, Rio and those other 2014 World Cup host cities and check out Brazil Weekly’s Brazil’s Next 10 Hottest Business Cities 2013.

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Regional News

In Brazil on May 31, 2013 at 11:21 am

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WEEKEND BREAKS!

Brazil Weekly now offers another new feature: Weekend Breaks! Over the next months we will show you how to enjoy your weekend out of town when staying in Brazil’s biggest business cities. First online was your Weekend Break out of Belo Horizonte, to the famous historic town of Ouro Preto, a must to visit. Our latest addition is your Weekend break from Sao Paulo to Guarujá, check it out!

FIFA WORLD CUP 2014

There is some good news in Brazil’s World Cup preparation according to The Economist: strong advance sales mean this will probably be the best-attended Confederations Cup yet. Almost all the tickets have been bought by locals.

Tickets for the FIFA World Cup Brazil 2014 will go on sale on August 20, 2013. The date was announced by the FIFA Marketing Director, Thierry Weil (Portal Brasil).

Less than 20 days away from the start of the Confederations Cup, part of the Fonte Nova stadium roof, one of the stadiums used in the event, collapsed Monday (27) morning due to heavy rain in Salvador. The stadium, reopened on April 7 at the cost of R$ 689.4 million (US$ 334.4 million), will host three Confederations Cup games in June. It will also host matches at the 2014 World Cup. The consortium that manages Fonte Nova, formed by Odebrecht and OAS, said the problem was “atypical”, caused by human error, and “it will never happen” during events (Folha).

ATLANTICO WEEKLY

Be welcome to visit Brazil Weekly’s sister publication Atlantico Weekly, with news about Angola, Mozambique and Cape Verde, three upcoming Portuguese speaking countries.

PROJECT OF THE WEEK

galeao

Render of the future expansion of Rio’s Galeao International Airport.

RIO

A more “cerebral” festival in literary terms, with experimental authors, and more open to mixing with other arts, to include on their panels filmmakers, musicians, architects and art historians. This is the profile of the 11th International Literary Festival of Paraty (FLIP), July 3-7 (Folha).

SAO PAULO

Check out what’s on at the prestigious Sala Sao Paulo!

Politics & Government News

In Brazil on May 24, 2013 at 9:39 am

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POLITICS

The number of poor recognized in records by the government would rise from zero to at least 22.3 million if the income officially used to define poverty were corrected for inflation, Folha reported. This number corresponds to more than 10% of the Brazilian population, another fact undermining the story of Brazil’s new middle class. READ THIS.

fhc

Brazil’s government needs to worry less about its high approval ratings and focus instead on reforms that, while unpopular, could bring the country out of its recent rut of subpar growth, former President Fernando Henrique Cardoso said. Speaking at the Reuters Latin America Investment Summit, Cardoso blamed politicians’ “excessive confidence” in the status quo for economic growth that averaged just 1.8 percent over the last two years, a period that saw Brazil fall out of favor as a hot spot for foreign capital (Reuters).

Brazil’s government has frozen 28 billion reais ($13.7 billion) in its 2013 budget as it tries to meet its primary surplus target, Finance Minister Guido Mantega said. Officials did not freeze portions of the budget set aside for investments and hosting the World Cup soccer tournament. The government may increase abatements against this year’s fiscal surplus goal to 45 billion reais, up from February’s estimate of 25 billion reais (Bloomberg).

With consumer defaults on the rise and confidence among shoppers at a three-year low in Brazil, the nerves are starting to show. Chaos broke out across at least 12 states over the weekend after rumours spread that the government was planning to suspend the nationwide Bolsa Família social welfare programme (FT).

President Dilma Rousseff strongly denied rumors that the government plans to end income subsidy program called Bolsa Familia. Because of the rumors, thousands of people crowded local government banks to withdraw what they believed to be their last subsidy payment (Xinhua).

Investigations of the National Truth Commission should not seek punishment of persons related to deaths, torture and disappearances during the military dictatorship (1964-1985). This is the opinion of former Justice Minister José Carlos Dias, a member of the board. “The purpose of the commission is not punitive,” he said. The punishment for crimes committed during the period will be a topic discussed by the commission at public hearings starting the middle of next year, about six months before the release of its final report. The purpose of the discussions will help define which recommendations the commission will adopt (Folha).

BRAZIL WEEKLY STORE

Check out the Brazil Weekly Store, our online shop in cooperation with Amazon.com. Now listing books on Brazil and Brazilian music cds!

INTERNATIONAL

An agreement signed on May 20 provides for the expansion of the Open University of Brazil (UAB) in Mozambique. As of 2015, over 2,000 places will be available in mathematics, biology, pedagogy and public administration courses. The consolidation and expansion of the Open University in Mozambique is expected to be implemented in five Mozambican provinces, in addition to the three already in the program (Portal Brasil).

Brazil’s big-spending tourists take New York by storm (FT).

OPINION

Be welcome to check out Brazil Weekly’s interview with Professor Bolivar Lamounier and find out Why you shouldn’t get too excited about Brazil’s new middle class…

SPLIT SECOND POLL

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CITY BRIEFS

Check out Brazil Weekly’s new feature City Briefs, a series of introductions to the country’s main economic centers, packed with relevant info for business travelers. First to hit the net were the Brazil Weekly City Briefs on Brasilia, the federal capital of Brazil, Belo Horizonte, the country’s third economic centre and Sao Paulo, the global megacity. Latest City Brief deals with Rio de Janeiro, the Marvelous City!

DEFENSE & SECURITY

Minister of Science, Technology and Innovation, Marco Antonio Raupp, launched the public selection process for the “Inova Aerodefesa” plan, in São José dos Campos (in the state of São Paulo). Under the plan, R$ 2.9 billion will be allocated to support technological innovation in aerospace, aeronautics, defense and public security (Portal Brasil).

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SOCIAL

Brazilian immigration authorities unveiled a set of favorite measures aimed at bringing in more foreign professionals. According to the new regulations published by the National Immigration Council, skilled foreigners can receive a temporary visa allowing them to work immediately for a 60-day term, during which they can present all required papers. The new policy differed strikingly from the old one, which stipulated that foreign workers had to submit the complete documents to the Brazilian consulates in their respective countries before they could obtain a work visa. It usually took 30 days to evaluate the documentation. Moreover, the government will create a digital record of the companies willing to recruit foreigners to work in Brazil, so it will not be necessary for them to present the complete documentation every time they hire a new foreign employee (Xinhua).

OPINION

Be welcome to check out our latest article, a reaction to a recent article in The Economist: Can Brazil Conquer Africa’s Booming Markets?

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Business & Economy News

In Brazil on May 24, 2013 at 9:38 am

SPLIT SECOND POLL

ECONOMY

Besides inflation, which is persistently at the upper limit of the target and shows no signs of abating,­ and an expansionary fiscal policy, which contradicts the monetary contraction indicated by what the Central Bank has been doing, other indicators of risk are beginning to emerge from the numerous uncertainties that have characterized the Brazilian economy this year. The origin of the new risks is an area that until recently did not seem to present serious problems: the external accounts. The main source of concern is the trade balance, which this year has accumulated through last month a deficit of US$6.2 billion. Read the FGV-IBRE’s report on Brazil’s economic risks.

Brazil’s economy will grow below 3 percent in 2013, economists predicted for the first time in a central bank survey of about 100 analysts published today. Latin America’s largest economy will grow 2.98 percent this year, down from the previous week’s projection of 3 percent. It would be the first time in a decade that Brazil grows below 3 percent for three consecutive years, Bloomberg reported.

In April 2013, the unemployment rate was estimated in 5.8% for the group of the six metropolitan areas surveyed. Statistically, there was stability both in relation to March (5.7%) and to April last year (6.0%). The unemployed population in April 2013 (1.414 million persons in the set of the six areas surveyed) did not post significant change, both in the monthly and in the annual comparison (IBGE).

The Extended National Consumer Price Index-15 (IPCA) changed 0.46% in May and stood below the IPCA-15 of April, which was 0.51%. With that result, the cumulative indicator of the year was at 3.06%, quite above the rate of 2.39% relative to the same period of 2012. Considering the last 12 months, the index went to 6.46%, going down the 6.51% of the 12 months prior to that period. In May of 2012, the rate was at 0.51% (IBGE).

The preview of the Industry Confidence Index (ICI) signals a high of 1.1% in the index in relation to the outcome of April. The improved perception on the present combined to the advance in the Level of Capacity Utilization suggests acceleration of activity pace in the sector for the month. Regarding the coming months, however, expectations have worsened for the third consecutive month (FGV-IBRE).

An unprecedented multibillion-real plan is the latest federal government initiative to stimulate investment in research, development, and innovation (RD & I), diversify the production of goods and services, and improve productivity. The government seems to have realized that without private investment in innovation, Brazil’s loss of competitiveness will accelerate. The Business Innovation Plan (Plano Inova Empresa) announced in March is expected to attract R $ 28.5 billion in direct investment from the government, plus R$ 4.4 billion from the national petroleum agency (ANP), Electric Energy (ANEEL), and the Brazilian Service of Support for Micro and Small Enterprises (Sebrae). It is also expected to boost private investment in RD&I to correct a major imbalance: too much basic scientific research and too little applied research. Read on at FGV-IBRE.

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BUSINESS

Fibria Celulose SA, the world’s largest pulp maker, plans to raise about 1 billion reais ($500 million) through land sales to pay debt, a step toward restoring an investment-grade credit rating, according to a person with knowledge of the proposal (Bloomberg).

Eike Batista, the Brazilian billionaire whose wealth shrank more than $27 billion since early last year, put one of his private jets on sale as the tycoon cuts costs and divests assets (Bloomberg).

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AGRI ETC.

Recent dryness in Brazil has led to some concerns about the potential yields of the safrinha corn crop, which will begin to be harvested starting in June. Mato Grosso is the largest safrinha corn producing state and the lack of rain has impacted the late planted corn in the state. Farmers in the state planted 80% of the corn during the normal planting window, but the remaining 20% was planted later than normal during the first half of March (Soybean & Corn Advisor).

AVIATION

As evidence that the interrelation between airlinks and urban hierarchy reinforces the hegemony of big cities over time, a new study by IBGE shows that São Paulo is the most central spot of the air network in the Brazilian territory, accordingly to its demography, its economic role and its position among global cities.Being the only “great national metropolis”, with the biggest population and the highest GDP in the country, the city was the leader in the ranking, with a flow of 26,848,944 passengers and 201,132,886 kg of cargo in 2010. Rio de Janeiro, on the other hand, has lost some of its relative importance in air traffic network, although it still holds a second position in passenger transportation (14,467,527 passengers, in 2010), with a less significant position in cargo transportation (37,296,620 kg, the fifth among the 19 cities in the ranking of major cargo handling) (IBGE).

Embraer and SkyWest Inc. announced a firm order, today, for 40 EMBRAER 175 aircraft. SkyWest will operate the aircraft under a Capacity Purchase Agreement (CPA) with United Airlines. Another 60 firm orders are reconfirmable aircraft, which are subject to SkyWest being awarded CPA agreement contracts with major U.S. airline partners. In addition to that, the agreement includes options for another 100 E175s, taking the total order potential up to 200 airplanes. The firm orders for the first 40 aircraft will be included in Embraer’s 2013 second quarter backlog. This sale is in addition to the contract signed by Embraer with United Airlines for 30 firm and 40 options for E175 jets (Embraer).

Embraer Executive Jets announced the sale of an ultra-large Lineage 1000, to an undisclosed European client, operated by Flyinggroup. The aircraft, the first Lineage 1000 sale to a customer in Belgium, will join the Belgium-based company’s fleet and will be available for third-party charter. Delivery of the aircraft is scheduled for the second half of 2013 (Embraer).

BANKING & FINANCE

State-run Banco do Brasil SA is in talks to buy possible takeover targets in the United States, Chile and Colombia, Reuters reported, adding the high value of banking assets in South America is no longer a problem. Any purchase in Colombia or Chile might have to be complemented with organic growth to create a complete banking platform that fits into Banco do Brasil’s business model. Since 2009, Banco do Brasil has avoided buying banks in those countries, saying targets were overpriced.

INFRA

Spain’s development minister said that her country is organizing a consortium of public and private companies to bid on the contract to create a high-speed passenger rail service linking Brazil’s two largest cities. The minister was accompanied by the president of Spanish state railway operator Renfe. The bids must be presented on Aug. 13 (Investe Sao Paulo).

Brazil is sweetening terms for major infrastructure contracts to whet investor appetite and draw private capital and expertise needed to upgrade its deficient roads, railways and ports, Reuters reported. Brazil recently raised the internal rate of return – a measure of profitability – for highway concessions from 5.5 to 7.2 percent previously. Railway projects, including a planned Rio de Janeiro-Sao Paulo bullet train, will offer rates of return of between 7 and 7.5 percent compared to about 6.3 percent previously.

MINING

Brazil is rich in rare-earth elements, it has technologic knowledge to begin extracting and producing these metals, but it needs to improve technology and enable the entrepreneurial sector (Federal Senate).

Brazil’s government plans to submit its mining reform bill to Congress in June rather than this month, energy minister Edison Lobao said, prolonging a wait that is slowing investment in mineral extraction. The bill, first unveiled in 2009, is expected to create an independent regulator, establish auctions for strategic minerals and impose tougher exploration and development schedules for concession holders (Reuters).

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OIL & GAS

Rodolfo Landim, who in 2007 helped Eike Batista set up an oil business before falling out with the billionaire, is competing with his ex-boss to extract crude and gas from northeastern Brazil. Ouro Preto Oil & Gas SA, a company Landim founded in 2010 after leaving Batista’s EBX Group Co., bought exploration licenses for three blocks in Brazil’s north corner near French Guiana. The firm, backed by Turim Investimentos and billionaire investor Julio Bozano, has about 25 employees, among them former executives from EBX and Petrobras, the world’s biggest oil producer in deep waters (Bloomberg).

HRT is abandoning a well that turned up dry in northern Brazil’s Solimoes Basin and another one in Namibia, where it found non-commercial oil volumes, according to a regulatory filing. The company will continue drilling three additional offshore wells in the African country, Bloomberg reported.

Brazil plans to sell the right to explore and develop its largest-ever oil discovery in October, auctioning an offshore petroleum prospect that is expected to produce about 12 billion barrels of oil over 35 years. The sale of the Libra prospect, which would be held a month earlier than expected, will be the first under new “production-sharing” rules that tighten state control and raise government participation in a Bangladesh-sized offshore area near Rio de Janeiro (Reuters).

PORTS

Following dredging work and adjustments to its pier, the Port of Tubarão is scheduled to conclude its first operation to fully load a Valemax ship, the world’s largest iron ore carrier, with total capacity of 400,000 metric tons. It will be the biggest loading operation in the 47-year history of the Port of Tubarão, beating its previous record, set in 2002 when the ship Berge Stahl was loaded with 335,088 metric tons of iron ore (Vale).

Brazil Regional News

In Brazil on May 24, 2013 at 9:36 am

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BEST ENGLISH BOOKS ON BRAZIL

Be welcome to check out Brazil Weekly’s book store in cooperation with Amazon.com! Browse the Brazil Weekly Store for highly relevant maps, books on politics, economics and history as well as travel or tourist guides and translated Brazilian literature. Click on the categories and watch our slide shows go by, packed with Brazil Weekly’s picks. You order straight with Amazon, one of the best online stores in the world. Enjoy!

MEET BRAZIL WEEKLY’S CONSULTANCY

Are you planning on doing business in Brazil? Get there with

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WEEKEND BREAKS!

Brazil Weekly now offers another new feature: Weekend Breaks! Over the next months we will show you how to enjoy your weekend out of town when staying in Brazil’s biggest business cities. First online was your Weekend Break out of Belo Horizonte, to the famous historic town of Ouro Preto, a must to visit. Our latest addition is your Weekend break from Sao Paulo to Guarujá, check it out!

– THE RISE OF THE PACS –

Meet three booming Portuguese-speaking African Countries…!

The rise of the what? Another acronym, you say? Well, why not… In Portuguese the countries are called PALOPs, the Paises Africanos de Lingua Oficial Portuguesa (or African Countries with Portuguese as Official Language). So we call them PACs. Three PACs have become booming economies and nobody is stopping them: Cape Verde, Angola and Mozambique. Check it out!

ATLANTICO WEEKLY

Be welcome to visit Brazil Weekly’s sister publication Atlantico Weekly, with news about Angola, Mozambique and Cape Verde, three upcoming Portuguese speaking countries.

PROJECT OF THE WEEK

balcam

Render of the 50 floor Views Privilege Home residential tower for Balneário Camboriú, Santa Catarina.

AMAZON

The National Petroleum Agency (ANP, in Portuguese) announced that the discovery of potential for oil production in the state of Amapá coast, at the outfall of the Amazon River, will be debated at a public hearing at the Senate Committee on Environment, Consumer Protection and Auditing (Federal Senate) .

RIO

With all the FIFA football (soccer) developments happening, one might forget that on August 5, 2016 the Games of the 31st Olympiad will begin in Rio. Some 10,500 athletes will compete in 28 sports, in 35 venues spread across four Olympic Zones: the Barra Zone, Copacabana Zone, Maracanã Zone, and Deodoro Zone, and here is a review of the layout.

Residents of Vila dos Pinheiros and Vila do João, favela communities in the massive Zona Norte (North Zone) Complexo da Maré neighborhood, are preparing for the establishment of a Police Pacifying Unit (UPP), following last month’s entry of armed forces into the area (The Rio Times).

SAO PAULO

Since returning to Brazil from New York in 1994, Mr. Atala has placed the country’s native produce center stage at his restaurants, D.O.M., which he opened in 1999, and Dalva e Dito, which followed a decade later. This summer, he is opening a bar called Riviera. The Wall Street Journal tours the city of Sao Paulo together with Atala.

Restaurant prices in São Paulo have been on the news. Keeping a restaurant open in Brazil has been a big challenge for sector entrepreneurs. Food is increasing in value, even at a international level, but infrastructure, labor and raw material costs, is all-time high and far from economic factors, growing exponentially. The public is feeling the high prices. But if, on the one hand, eating out is expensive now, for entrepreneurs, profit is shrinking (Folha).

Sao Paulo Mayor Fernando Haddad is lobbying for federal aid to triple investment in Latin America’s largest city to 6 billion reais ($2.9 billion) a year by 2016. Haddad, former education minister under President Dilma Rousseff and her predecessor, said the funds will accelerate investments to unlock gridlocked traffic, reduce commuting time and expand health and education. The mayor said he’s working on adding bus-only lanes and smart traffic lights that adjust to vehicle flow, and has a plan to build hospitals, day-care centers and add low-income homes near the city center. To prevent flooding, Haddad plans to restore buffers for rivers that regularly overflow into main thruways in the rainy season (Bloomberg).

More concentrated in downtown São Paulo than in previous years, the Virada Cultural, an event that features musical attractions and artistic interventions in São Paulo during 24 hours, ended on Sunday – however, it was one of the most violent editions in the nine years the event has been held, Folha reported. A year before the 2014 World Cup fan fests, which will also occur in downtown São Paulo, a wave of looting, collective plundering, and robberies upstaged the shows, which again included rap, and also funk and forró concerts, along with major artistic interventions – this year’s edition saw the solution of some infrastructure problems.

Check out what’s on at the prestigious Sala Sao Paulo!

SPLIT SECOND POLL

– NEW EDITION –

BRAZIL WEEKLY’S BRAZIL’S NEXT 10 HOTTEST BUSINESS CITIES

Rodoviária de Londrina - Ft: Milton Dória - 2004

Check out our revised, 2013, edition! No doubt the biggest and most important business centres of Brazil are the megacities of Sao Paulo and Rio de Janeiro and do not forget most other state capitals like Belo Horizonte, Salvador da Bahia, Recife, Fortaleza, Curitiba and Porto Alegre. But Brazil is big and there are plenty of other fast developing cities, not being state capitals. So for a minute forget Sao Paulo, Rio and those other 2014 World Cup host cities and check out Brazil Weekly’s Brazil’s Next 10 Hottest Business Cities 2013.

Politics & Government News

In Brazil on May 17, 2013 at 11:33 am

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INTERNATIONAL

The choice of a Brazilian to lead the WTO is an interesting one. Brazil has more often been an obstacle to liberalisation than a facilitator. In his campaign Mr Azevêdo sought to draw a distinction between the views of the candidates and their home countries. Yet it seems probable that support by emerging markets for Mr Azevêdo’s candidacy was motivated in part by a sense of shared interests. That could spell trouble for the global negotiations (The Economist).

Latin America is falling in behind two alternative blocks: the market-led Pacific Alliance and the more statist Mercosur around Brazil (The Economist).

The Financial Times published a special on US-Brazil relations.

Uruguay’s leftist former guerrilla president, José Mujica, is renowned for telling it like it is. Which is why he doesn’t mince his words, in an interview with the Financial Times, highlighting why he is working on port and rail plans with one of his big neighbours, Brazil and, er, nothing with the other, Argentina.

Brazil and Germany vowed to step up cooperation between the two countries. At the 2013 Brazilian-German Economic Meeting in Sao Paulo, President Dilma Rousseff and her German counterpart Joachim Gauck officially launched the Year of Germany in Brazil, which is expected to expand ties between the two nations, boost cooperation and encourage joint initiatives (Xinhua).

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CITY BRIEFS

Check out Brazil Weekly’s new feature City Briefs, a series of introductions to the country’s main economic centers, packed with relevant info for business travelers. First to hit the net were the Brazil Weekly City Briefs on Brasilia, the federal capital of Brazil, Belo Horizonte, the country’s third economic centre and Sao Paulo, the global megacity. Latest City Brief deals with Rio de Janeiro, the Marvelous City!

DEFENSE & SECURITY

In the opinion of the minister of Defense, Celso Amorim, Brazil should dedicate at least 2% of the Gross Domestic Produt (GDP) to military purposes, what would almost bring the country to the same level of other developing nations such as Russia, China, India, and South Africa. The minister, who attended a hearing of the Committee on External Relations and National Defense, said that the Brazilian budget dedicated to the Army nowadays is 1.5% of the GDP, and that the raise of 0.5% is a reasonable goal to be achieved in 10 years (Federal Senate).

The number of new guns legally sold in Brazil sextupled in the last eight years, growing from 5,161 in 2004 to record 31,500 in 2012, local daily O’Globo reported (Xinhua).

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SOCIAL

The General Coordination of Immigration of the Ministry of Labor and Employment (CGIg/MTE) granted 15,064 work permits (698 permanent and 14,366 temporary) to foreigners in the first quarter of this year. Of the total number of permits granted, 13,659 were for men and 1,405 were for women. 5,994 visas were granted for a duration of up to 90 days, 3,195 for a duration of up to one year, 1,182 for a duration of up to two years with an employment contract in Brazil, and 3,995 were granted for a duration of up to two years without an employment contract in Brazil. Portuguese and Spanish professionals received more work visas than any other nationality for a duration of up to two years with an employment contract in Brazil, during the first three months of the year: 197 and 118, respectively (Portal Brasil).

OPINION

Be welcome to check out our latest article, a reaction to a recent article in The Economist: Can Brazil Conquer Africa’s Booming Markets?

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Business & Economy News

In Brazil on May 17, 2013 at 11:32 am

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ECONOMY

Economic activity in Brazil accelerated in the first quarter, central bank data showed, adding to signs that a gradual recovery has gained steam after massive stimulus by President Dilma Rousseff’s government. The improvement happened even though retail sales, one of the main pillars of recent economic growth, had its weakest quarter in five years as inflation jumped. This suggests Brazil relied less on consumers and more on industrial output and private investments to expand recently (Reuters).

In March 2013, Retail Trade in the country recorded decrease of -0.1% in volume of sales and increase of 0.8% in nominal revenue, being both figures seasonally-adjusted results over the previous month. In terms of volume and revenue of sales, the results surpassed those of the previous month. With reference to the quarterly moving average, volume of sales did not record change (0.0%), whereas nominal revenue increased 0.9% (IBGE).

There are now over 3 million people registered in the individual entrepreneur program. The Individual Entrepreneur is a person who works on their own, on a formal basis as a small business. In order to register in this category, income must not exceed R$ 60,000 per year and applicants must have no interest in another company as a partner or owner. The entrepreneur may also hire an employee who receives the minimum wage or the base wage for the category (Portal Brasil).

The General Price Index – 10 (IGP-10) fell by 0.09% in May, compared to 0.18% in April. In May 2012, it went up 1.01%. The cumulative change rate in 2013, until May, is 1.02%. In 12 months, the IGP-10 increased 6.28% (IBRE).

After recording improvement since October 2012, the Ifo/FGV Economic Climate Index for Latin America (ECI) – developed in partnership between the German Ifo Institute and the FGV taking as a data source the Ifo World Economic Survey (WES) – decreased to 5.2 from 5.5 points between January and April 2013. The deterioration is associated to the Ifo/FGV Expectations Index (EI), since the Ifo/FGV Present Situation Index (PSI) has evolved favorably. It is noteworthy, however, that all indicators are in the favorable zone, although near the region which marks the limit for unfavorable zone (IBRE).

Brazil’s economy would grow by 3 percent this year, Central Bank President Alexandre Tombini said. Household consumption is solid and increasing, due to salary growth and job generation. Investment returned in the fourth quarter of 2012 and intensified in the first quarter of 2013. Tombini said Brazil was also benefiting from favorable external conditions as one of the main recipients of foreign investment. Brazil attracted 65 billion U.S. dollars in foreign direct investment in 2012, consolidating its position as the favorite destination for foreign capital in Latin America. Brazil’s economy grew only 0.9 percent in 2012, following an expansion of 2.7 percent in the previous year (Xinhua).

BUSINESS

The Brazilian government announced import tax cuts on 157 products, including capital goods and computer equipment. The government renewed its lower tax rates on 17 products and added another 140 to the list, slashing the tax rate on capital goods from 14 percent to 2 percent and the rate on computer and communications equipment from 16 percent to 2 percent (Xinhua).

The Brazilian government’s local content rules are “very dodgy, they are not free trade and are the same as putting your fingers on the scale.” That was the harsh criticism of the Acting Secretary of Commerce of the U.S., Rebecca Blank, to describe the main complaint of U.S. businessmen who want to invest in Brazil (Folha).

The performance of Brazil’s industry in 2012 was the worst among 25 developing countries and important economies of Latin America. The 2.6% decline in Brazil’s industrial production was the greatest by far in the group. Egypt in second place had a 1.9% decline. Brazilian industry as a component of the Gross Domestic Product – which, aside from manufactured products, includes sectors such as civil construction and electric energy – also had the biggest decline in the developing world – a slump of 0.8% (Folha).

Brazil is planning a 508.5 billion-real ($252 billion) stimulus package aimed at providing universal access to water and sewage treatment nationwide by 2033. The government may announce the package in early June and is also considering cutting two taxes for the industry known as PIS and Cofins. The government will invest 298.1 billion reais in the next 20 years, including 50 billion reais in 2013-2014, according to the article. The remainder will be furnished by states, municipalities and private companies (Bloomberg).

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AGRI ETC.

Sugar production in Brazil’s main cane belt surged in April, outpacing last year’s early harvest by 210 percent, as rains cleared in the middle of last month to allow crushing of the record crop to accelerate, industry association Unica said (Reuters).

AVIATION

Things have suddenly got tougher for Latam, the merged Lan-Tam airline which just unveiled first-quarter results. It has a hefty $1.8bn in short-term debt and is suddenly facing heightened competition on its domestic Brazilian, international and cargo routes. No wonder it needs money. Which explains why it is seeking to raise $1bn from shareholders by October (FT).

Embraer has named more suppliers of important systems that will equip the second-generation E-Jets, which are expected to go into service in 2018. The Company selected Moog to supply the fly-by-wire control system, consisting of flight control computers and all of the hydraulic actuators of the primary surfaces, spoilers, and ground spoilers (Embraer).

Gol is counting on routes outside the country to boost revenue as it exhausts possible cost savings after eliminating jobs, flights and planes. Additional service will start in 2013’s second half between Santo Domingo in the Dominican Republic and North America, Central America and the Caribbean as Gol opens an international hub in the nation’s capital (Bloomberg).

BANKING & FINANCE

Credit supply in Brazil has been a little puzzling recently. While private-sector banks have been much more careful, state banks have responded to government pressure to keep credit flowing. No wonder then that government-controlled Banco do Brasil is turning to the international debt markets for help (FT).

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OIL & GAS

After five dry years, Brazil’s oil-and-gas concession pipeline is flowing once more. On May 14th the national regulator, ANP, successfully auctioned 142 blocks in 11 fields, both onshore and offshore, thought to hold as much as 35 billion barrels of oil between them (The Economist).

Petrobras acquired the most blocks offered in the 11th Bid Round held by the National Petroleum Agency (ANP). Petrobras bought, whether on its own or in partnerships, 34 of the 289 blocks offered in the bid. It also secured, in its technicians’ opinions, the blocks with the highest exploratory potential offered by the agency, located in the Foz do Amazonas, Espírito Santo and Barreirinhas Basins. In its strategy to acquire onshore blocks, Petrobras invested primarily in the Parnaíba Basin, seeking natural gas accumulations (Petrobras).

PORTS

President Dilma Rousseff won congressional support for a plan to attract private capital and boost investment in ports by $27 billion. Brazil’s economy grew 0.9 percent in 2012 and 2.7 percent in 2011, slower than all other nations in the BRICS group. Exports, which account for 12.5 percent of gross domestic product, last year dropped 5.3 percent from 2011 (Bloomberg).

An investigation has found that some of Brazil’s port terminals are still not operating twenty-four hours a day, despite the introduction of the Porto 24 horas (24-Hour Port) program nearly a month ago, aimed at improving the ports efficiency. According to the report by O Globo newspaper, the effect of the introduction of the program at ports in Rio, Santos (São Paulo state) and Paranaguá (Paraná state), has had virtually no effect (The Rio Times).

Brazil Regional News

In Brazil on May 17, 2013 at 11:30 am

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WEEKEND BREAKS!

Brazil Weekly now offers another new feature: Weekend Breaks! Over the next months we will show you how to enjoy your weekend out of town when staying in Brazil’s biggest business cities. First online was your Weekend Break out of Belo Horizonte, to the famous historic town of Ouro Preto, a must to visit. Our latest addition is your Weekend break from Sao Paulo to Guarujá, check it out!

– THE RISE OF THE PACS –

Meet three booming Portuguese-speaking African Countries…!

The rise of the what? Another acronym, you say? Well, why not… In Portuguese the countries are called PALOPs, the Paises Africanos de Lingua Oficial Portuguesa (or African Countries with Portuguese as Official Language). So we call them PACs. Three PACs have become booming economies and nobody is stopping them: Cape Verde, Angola and Mozambique. Check it out!

ATLANTICO WEEKLY

Be welcome to visit Brazil Weekly’s sister publication Atlantico Weekly, with news about Angola, Mozambique and Cape Verde, three upcoming Portuguese speaking countries.

PROJECT OF THE WEEK

realevobrasi

Render of the Real Evolution residential complex for Brasilia.

AMAZON

President Dilma Rousseff has ordered her government to stop confiscating farmland to create new Indian reservations, government officials say, a policy reversal with major implications for one of the world’s top agricultural producers. Brazil has in recent decades set aside about 13 percent of its territory for indigenous tribes. Vast additional areas, including prime territory for the production of soy, beef, sugar and other commodities, are under consideration for possible transfer (Reuters).

RIO

SAO PAULO

World football’s governing body FIFA has warned Sao Paulo could be stripped of its status as a 2014 World Cup host city due to stadium construction delays (Xinhua).

Check out what’s on at the prestigious Sala Sao Paulo!

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– NEW EDITION –

BRAZIL WEEKLY’S BRAZIL’S NEXT 10 HOTTEST BUSINESS CITIES

Rodoviária de Londrina - Ft: Milton Dória - 2004

Check out our revised, 2013, edition! No doubt the biggest and most important business centres of Brazil are the megacities of Sao Paulo and Rio de Janeiro and do not forget most other state capitals like Belo Horizonte, Salvador da Bahia, Recife, Fortaleza, Curitiba and Porto Alegre. But Brazil is big and there are plenty of other fast developing cities, not being state capitals. So for a minute forget Sao Paulo, Rio and those other 2014 World Cup host cities and check out Brazil Weekly’s Brazil’s Next 10 Hottest Business Cities 2013.

OPINION

Be welcome to check out Brazil Weekly’s interview with Professor Bolivar Lamounier and find out Why you shouldn’t get too excited about Brazil’s new middle class…

Politics & Government News

In Brazil on May 10, 2013 at 11:23 am

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POLITICS

Brazil has set up the Ministry for Small Businesses to boost small and individual enterprises, It will be headed by Sao Paulo’s vice governor Guilherme Afif Domingos, of the PSD party.

afif

The main reason for this nomination is to widen support for the president’s re-election by bringing Afif Domingos’ fast-growing PSD party, the third largest in Congress, into her unwieldy 18-party coalition (Reuters).

Presidential Chief of Staff Gleisi Hoffmann criticized Funai (National Indian Foundation) for errors in the process of demarcation of Indian lands and said the government is preparing a new model to set the borders – other governmental agencies will contribute in the process. Hoffmann attended a tense meeting with the Agriculture Commission of Congress, convened by the rural caucus, which accuses Funai of defrauding reports and inciting conflicts between Indians and rural producers. The Indians, on the other hand, complain that the demarcation process is taking too long (Folha).

Brazil’s government should pursue reforms aimed at making the country a more attractive place to do business, instead of simply cutting taxes or interest rates to improve returns, billionaire financier André Esteves said. Esteves mentioned programs to enhance the quality and coverage of education, rules to facilitate the securitization of corporate receivables and the simplification of laws to open small business as some of those measures (Reuters).

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INTERNATIONAL

The selection of Brazil’s Roberto Azevedo as the next head of the World Trade Organization may help ease emerging markets’ resistance to removing barriers as part of global trade talks, Bloomberg reported. Azevedo, who is now Brazil’s ambassador to the Geneva-based WTO, defeated former Mexican Trade Minister Herminio Blanco in the final round of closed-door consultations among the WTO’s 159 members, putting him in line to become the first director- general from Latin America.

Brazil has offered to help Russia and the United States negotiate an end to the Syrian crisis, Foreign Minister Antonio Patriota said.

Cuba and Brazil were engaged in more diplomatic activities this week seeking to expand economic cooperation, with top officials exchanging visits to each other. Brazil’s Minister of Tourism, Gastao Vieira, who was in Havana to attend Cuba’s annual travel trade fair, urged the two countries to boost cooperation in tourism and said they are experiencing a defining moment in the sector. Trade Minister Fernando Pimentel was also in Havana for a brief visit. He signed with his Cuban counterpart Rodrigo Malmierca a Memorandum of Understanding aimed at financing a project to expand and modernize Cuba’s airports (Xinhua).

Foreign Minister Antonio Patriota and his Cuban counterpart Bruno Rodriguez announced that they are in talks to sign an agreement for some 6,000 Cuban doctors to work in Brazil. The initiative, originally proposed during Brazilian President Dilma Rousseff’s visit to Havana in January 2012, has the support of the Pan-American Health Organization (PAHO) (Xinhua).

Venezuelan President Nicolas Maduro got strong backing from regional heavyweight Brazil on a tour of South American allies to cement his legitimacy as political heir to the late Hugo Chavez. The clear endorsement from the largest and most influential Latin American nation will strengthen Maduro’s grip on power following his contested election in the oil-producing nation last month. “We wish you great success with your presidential mandate and your government,” Brazilian President Dilma Rousseff said after a meeting in which she promised Venezuela food supplies, expanded trade and cooperation in the oil and gas sector (Reuters).

Trade and Industry Minister Fernando Pimentel refuted criticism from some European countries including France and Britain of trade protectionism. “The criticism against Brazil is unfounded. Brazil has never been convicted in the World Trade Organization (WTO) and is one of the countries which follow the international trade regulations more strictly,” he said. The accusations are in fact a maneuver to get in the Brazilian market, the minister said (Xinhua).

President Dilma Rousseff and her Egyptian counterpart Mohamed Morsi signed a series of cooperation agreements on environment, agriculture, agrarian and social development, healthcare and architectural planning. The two leaders met for almost two hours at the presidential palace in Brasilia, to explore ways to increase trade flows and bilateral investment, as well as discussing regional and global issues. In a joint declaration, Rousseff noted that Egypt is the main destination in Africa for Brazilian exports, adding that as in Brazil, Egypt’s democratization process will stimulate the economy (Xinhua).

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CITY BRIEFS

Check out Brazil Weekly’s new feature City Briefs, a series of introductions to the country’s main economic centers, packed with relevant info for business travelers. First to hit the net were the Brazil Weekly City Briefs on Brasilia, the federal capital of Brazil, Belo Horizonte, the country’s third economic centre and Sao Paulo, the global megacity. Latest City Brief deals with Rio de Janeiro, the Marvelous City!

DEFENSE & SECURITY

Boeing Co could keep building its Super Hornet fighter jet and a modified electronic attack version through 2020, the company said, given prospects for over 200 foreign sales and what it sees as up to 150 more sales to the U.S. Navy. Boeing is a strong contender to win Brazil’s 35-aircraft competition, where a decision is expected by the third quarter. Boeing has dramatically increased its presence in Brazil over the past year, partnering with Brazilian planemaker Embraer SA and other companies on a range of projects. The company is offering Brazil and other international customers a package of upgrades priced at $8 million to $9 million to add capabilities to the Super Hornet, including a larger touchscreen cockpit display, missile tracking, an engine with 20 percent more thrust, new fuel tanks and an internal weapons pod to make the plane harder to see on radar screens (Reuters).

EDUCATION

Young foreign researchers from developing countries who are interested in completing part of their education in Brazil can apply through Public Invitation 03/2013. Benefiting programs and the number of scholarships available are as follows: PhD Sandwich (30), Full PhD (20) and Postdoctoral (10). Proposals will be approved by the National Council of Scientific and Technological Development (CNPq) and the Academy of Sciences for the Developing World (TWAS), an organization associated with the United Nations Educational, Scientific and Cultural Organization (UNESCO), in the following areas: Agricultural Sciences, Biological Sciences, Medicine & Health Sciences, Chemistry, Engineering, Mathematics & Probability and Statistics, Computer Science, Physics, Astronomy & Geosciences and Oceanography (Portal Brasil).

OPINION

Be welcome to check out our latest article, a reaction to a recent article in The Economist: Can Brazil Conquer Africa’s Booming Markets?