Export to Brazil
The Federative Republic of Brazil is Latin America's largest economy and is the fifth largest country in the world in terms of land mass and population, with a population of 197 million. Brazil’s economy, the 7th largest in the world, grew 0.9% in 2012. Growth slowed due to reduced demand for Brazilian exports in Europe and Asia, despite strong consumer demand and continued growth in the middle class. By 2020, Brazil is projected to be the 5th largest consumer market in the world, ahead of France and the United Kingdom.
During the past decade, the country has maintained macroeconomic policies that control inflation and promote economic growth. Inflation was 6.5% in mid-2013. Urban unemployment was at 5.8% in April 2013, while wages continue to increase. Interest rates are high by international standards. The Central Bank’s benchmark rate was 7.56% in April 2013, higher than its 2012 low point, but still low by Brazilian historical standards.
Market Opportunities
Certain sectors of the Brazilian market have experienced higher than average growth in recent years, such as air transportation, infrastructure, oil and gas, and mining. Under the second phase of the Growth Acceleration Program (PAC II), the Government of Brazil will spend or attract private investment of some R$955 billion (approximately US$470 billion) in development of the country’s energy generation and distribution system, roads, railroads, ports, and airports as well as stadiums as it prepares for the upcoming 2014 soccer World Cup and 2016 Olympics. The GOB has begun auctioning concessions to private companies to operate airports, ports, roads, and railways. In the years leading up to the 2016 Olympic Games in Rio de Janeiro, the country will host several large international events. In 2012, Rio de Janeiro hosted the Rio+20 United Nations Conference on Sustainable Development (UNCSD). In 2013, Brazil hosted the soccer Confederations Cup and a papal visit for World Youth Day event. In 2014, twelve Brazilian cities will host soccer’s World Cup.
Although more than half of Rio’s Olympics venues are already built, a legacy from the Rio 2007 Pan American Games, investments are being funneled into areas such as airport renovation, stadium construction and renovations and infrastructure projects – all in preparation for the tourists who will attend these major events. Unlike in London, the percentage of investments dedicated to transportation such as buses, beltways and metro lines is expected to be higher than investments dedicated to Olympic sports projects such as arenas and stadiums. The GOB has stated that it is focused on using the major sporting events as an opportunity to make long-term investments in infrastructure that will improve the quality of life in Brazil well after the Games have concluded.
Other promising areas for exports and investment include oil and gas, agricultural equipment, building and construction, aerospace and aviation, safety and security devices, IT, medical equipment, sporting goods, environmental technologies, retail, and transportation. Brazil is one of the largest IT markets within the emerging economies. IT end-user spending in Brazil is expected to grow to US$134 billion in 2014. The largest share of spending will be on telecom equipment, representing 72% of the market, followed by IT services at 13.3% and computing hardware at 11.9%.
During the past decade, the country has maintained macroeconomic policies that control inflation and promote economic growth. Inflation was 6.5% in mid-2013. Urban unemployment was at 5.8% in April 2013, while wages continue to increase. Interest rates are high by international standards. The Central Bank’s benchmark rate was 7.56% in April 2013, higher than its 2012 low point, but still low by Brazilian historical standards.
Market Opportunities
Certain sectors of the Brazilian market have experienced higher than average growth in recent years, such as air transportation, infrastructure, oil and gas, and mining. Under the second phase of the Growth Acceleration Program (PAC II), the Government of Brazil will spend or attract private investment of some R$955 billion (approximately US$470 billion) in development of the country’s energy generation and distribution system, roads, railroads, ports, and airports as well as stadiums as it prepares for the upcoming 2014 soccer World Cup and 2016 Olympics. The GOB has begun auctioning concessions to private companies to operate airports, ports, roads, and railways. In the years leading up to the 2016 Olympic Games in Rio de Janeiro, the country will host several large international events. In 2012, Rio de Janeiro hosted the Rio+20 United Nations Conference on Sustainable Development (UNCSD). In 2013, Brazil hosted the soccer Confederations Cup and a papal visit for World Youth Day event. In 2014, twelve Brazilian cities will host soccer’s World Cup.
Although more than half of Rio’s Olympics venues are already built, a legacy from the Rio 2007 Pan American Games, investments are being funneled into areas such as airport renovation, stadium construction and renovations and infrastructure projects – all in preparation for the tourists who will attend these major events. Unlike in London, the percentage of investments dedicated to transportation such as buses, beltways and metro lines is expected to be higher than investments dedicated to Olympic sports projects such as arenas and stadiums. The GOB has stated that it is focused on using the major sporting events as an opportunity to make long-term investments in infrastructure that will improve the quality of life in Brazil well after the Games have concluded.
Other promising areas for exports and investment include oil and gas, agricultural equipment, building and construction, aerospace and aviation, safety and security devices, IT, medical equipment, sporting goods, environmental technologies, retail, and transportation. Brazil is one of the largest IT markets within the emerging economies. IT end-user spending in Brazil is expected to grow to US$134 billion in 2014. The largest share of spending will be on telecom equipment, representing 72% of the market, followed by IT services at 13.3% and computing hardware at 11.9%.