Foreign investors have both eyes on Brazil’s promising market
The great potential of the Brazilian consumer market has become a major target for foreign investment. Between this year’s January and May, foreigners have invested more than US$ 11.2 billion in industry, commerce, agriculture and service in general – the second biggest investment amount of the decade.
In interview to the Brazilian newspaper O Estado de S. Paulo, the president of the Brazilian Society for Transnational Companies and Economic Globalization (Sobeet), Luís Afonso Lima, highlighted that the quantity of resources in this year’s first five months was the same as the total volume that entered the country during the first five months of 1999, when a series of privatizations attracted great amounts of foreign capital.
According to a research conducted by the Brazilian Central Bank, the perspective for 2009 is that IED (Direct Foreign Investments) reach US$ 25 billion, still below 2008′s US$ 45 billion record. However, if the perspective for this year is confirmed, the amount of foreign investment will be the 6th ever measured by CB, since 1947.
In the beginning of the year, there was a strategic cut on foreign investment. Multinational companies had to send capital to their headquarters, which were in a tough situation due to the economic crisis. Now that phase is over, and companies have resumed their investments in Brazil with both eyes on its consumer market. “Multinationals are looking for long-term, for profitability is getting smaller in developed markets”, states Lima.