News from Brazil

Brazil Weekly, March 7th

In Uncategorized on March 7, 2010 at 2:15 pm


Brazil’s presidential election in October looks less risky to investors than any other in the last quarter of a century and the economy has bounced back after a brief recession, but there are still investment risks to watch in Brazil this year (Reuters).

Secretary of State Hillary Clinton failed to win Brazil’s support for more sanctions against Iran and said Tehran would not talk seriously about its nuclear program until the United Nations took new action (Reuters).

Brazil’s leading opposition candidate, Sao Paulo state Governor Jose Serra, has failed to convince a popular governor from his own party to be his vice-presidential running mate in October’s election. Aecio Neves, a young and charismatic governor from the central state Minas Gerais, said he did not plan on running with Serra (Reuters).

Serra praised the Brazilian government for the economic stimulus measures it took during the global financial crisis (Reuters).

Former Brazilian President Fernando Henrique Cardoso, who twice defeated President Lula in the 1990s, said that while Lula is “unbeatable” today, his popularity won’t be enough to elect his chosen heir (Bloomberg).

The ongoing corruption scandal that has dogged the Conservative Democrat Party (DEM) has claimed another victim, with the resignation of acting governor of Brasilia Paulo Octavio (Rio Times).


Brazil’s industrial output surged in January from a year ago, but not as quickly as it did in December, easing concerns Latin America’s largest economy may be overheating (Reuters).

Brazil, a country long associated with youthful beauty, is entering a period of rapid aging that will change its face. The number of Brazilians over 60 will jump by more than half over the next 15 years to around 32 million. By 2050, government forecasts show the number will have tripled even as Brazil’s overall population contracts after hitting a peak of around 210 million in 2030, from 190 million now (Reuters).

Chief of the IMF Dominique Strauss Khan has handed down a warning to Brazil, among others nations, that there is a very real risk of an ‘asset bubble’ developing in the emerging economies of the world (Rio Times).


Brazil’s JBS, the world’s largest producer of animal protein, posted a net quarterly profit of 127.9 million reais ($71 million), reversing losses of 53.4 million reais in the fourth quarter of 2008 (Reuters).

France’s Lafarge, the world’s largest cement producer, agreed to swap a stake in Portuguese rival Cimpor for plants in Brazil, a move that will help it become the third-largest producer of the material in the South American nation (Reuters).

Grupo Pao de Acucar, Brazil’s largest diversified retail group, should see same-store sales rising close to 15 percent this year, indicating strong customer demand for foods and home appliances, newly-appointed Chief Executive Eneas Pestana said (Reuters).

Brazilian miner Vale, the world’s largest iron ore producer, is planning to nearly double iron prices for domestic steelmakers by April (Reuters).

OSX, the Brazilian shipbuilder owned by billionaire Eike Batista, plans to raise up to 9.92 billion reais ($5.6 billion) in what could become the nation’s largest initial public offering this year. Shipbuilding is expected to thrive in Brazil (Reuters).

Portugal Telecom’s biggest individual investor said Brazil is “a must” for future growth and that the phone company should try to buy Telefonica’s stake in Vivo (Bloomberg).

East Japan Railway, the nation’s largest rail operator, may join a Japanese government-backed group bidding to build and operate an $18 billion high-speed rail line in Brazil (Bloomberg).

Buyout firms are poised to spend $9 billion in Brazil on everything from infrastructure to oil exploration as the economy recovers from a recession (Bloomberg).


Santander Brasil, Brazil’s third-largest nongovernment bank, forecasts loans could grow as much as 22 percent this year as small and mid-sized businesses and individuals take on more credit, Chief Financial Officer Carlos Lopez Galan said (Reuters).


Brazilian state run oil company Petrobras is seeking a stake of up to 40 percent in ethanol maker ETH Bioenergia to slow the growing influence of foreigners in the country’s ethanol sector, local newspaper Folha de Sao Paulo reported (Reuters).


OGX, the oil company controlled by billionaire Eike Batista, said it made a third discovery at an offshore Campos basin block in Brazil (Bloomberg).

Petrobras received approval to buy 30 percent of an offshore block from Repsol YPF and Statoil ASA, the South American country’s oil regulator said (Bloomberg).


Brazil’s Energy Ministry said the Belo Monte hydroelectric dam project will require investments of as much as 20 billion reais, more than previously estimated (Bloomberg).


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