News from Brazil

Brazil Business & Economy News

In Brazil on July 8, 2011 at 11:39 am


A battle is escalating between two giant French retailers, Carrefour and Casino, over who gets to join up with Pão de Açúcar, Brazil’s biggest supermarket chain. But the verdict on the merger will come from the BNDES—whose president, Luciano Coutinho, now says it will only back the deal if Casino is reconciled—rather than from CADE, the competition authority (The Economist).

Economists lowered their forecast for Brazil’s benchmark inflation index this year to 6.15 percent from 6.16 percent previously, according to a weekly central bank survey (Reuters).

The Brazilian Ministry of Sports has announced that the country’s economy is forecasted to grow by over US$ 70 billion as a result of its hosting the 2014 FIFA World Cup, through private and public investment in infrastructure, heightened consumption, increased activity in the services sector and tax collection (Brasil Portal).

The Government and the National Confederation of Industry have agreed upon the creation of a new company to develop innovative projects for the productive sector. According to the Minister of Science and Technology, Aloízio Mercadante, the new company will follow the model of the Embrapa (Brazilian Enterprise for Agricultural Research) and its relation with centers of excellence of research, but aimed for the industrial development. The name suggested by the Minister is Brazilian Enterprise for Industrial Research (Embrapi) (Investe Sao Paulo).

Siemens AG, Europe’s biggest engineering conglomerate, plans to spend $600 million in Brazil through 2016 to build as many as three factories (Reuters).

When it comes to acrimonious, multi-billion dollar disputes, Brazilian tycoon Abilio Diniz’s current showdown with French retailer Casino Guichard Perrachon might not even rank as the worst. Read his biography at Reuters.


Tom Jobim is famous for having said, “Brazil is not for amateurs.” A new buzzword in economic circles is “convergence,” the process by which the developing economies in which five billion people live (194 million of them in Brazil) are closing the gap on developed economies more than 150 years after the Industrial Revolution first opened the gulf. To arrive in Brazil these days from the United States or Europe is to feel the world turned on its head. Today, in the Brazil of the “Ms. Continuity” leader, President Dilma Rousseff, a lot of people suddenly fancy themselves as Brazil pros. The New York Times’ Roger Cohen is bullish on Brazil, but argues some of the new “pros” are going to get burned.


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The strange tale of Robert Wladyslaw Parzelski, a 44-year-old Polish man who got “lost” inside São Paulo’s international airport for 18 days, has captivated Brazilian newspaper readers and drawn comparisons with Steven Spielberg’s 2004 comedy The Terminal (The Guardian).


With disbursements totaling over R$178 billion last year, pundits are calling the BNDES (Banco Nacional do Desenvolvimento, or Brazilian National Development Bank) the most significant lender in the Western hemisphere. However, some economists have criticized the bank’s lending policies as being inconsistent with its own goals and priorities (The Rio Times).


President Dilma Rousseff plans to reduce the amount of ethanol it mixes into gasoline after falling sugar-cane production drove up the price of the biofuel (Bloomberg).


Brazil’s government auditing body, the TCU, has ordered changes to a document outlining the Sao Paulo-Rio de Janeiro high speed rail link and bidding rules for the project, likely pushing back the deadline for the tender (Reuters).


Community, climate change, energy, water, health and safety, emissions, waste, talent management, development of suppliers and land use: based on these topics, considered the most important by different stakeholders, Vale launched its fourth Annual Sustainability Report, which refers to 2010. For the second consecutive year, Vale has achieved an A “application level,” indicating the highest level of transparency, and the company presents its performance in economic, environmental and social dimensions in line with the Global Reporting Initiative (GRI) methodology (Vale).

The chief executive of Brazilian steelmaker CSN said the company could buy more of rival Usiminas should two controlling shareholders decide to sell their stakes (Reuters).

Billionaire Eike Batista is negotiating with BNDESPar, a subsidiary of the country’s state development bank, for loans for two companies (MPX and OSX) he controls, Folha de S. Paulo reported (Bloomberg).


Petrobras announced that well 9-RJS-660, located in the Lula field, has posted the Company’s highest volume of production for May, reaching an average of 28,436 barrels of oil per day (bpd). This well is the first to produce on a commercial basis in the Santos Basin pre-salt cluster. This result confirms the high potential of Brazil’s pre-salt reservoirs. Taking oil and natural gas output, the total volume was 36,322 barrels of oil equivalent per day (boed) (BW).

French oil major Total said it was ready to take part in the development of Brazil’s untapped subsalt oil wealth as soon as Brasilia gives the go-ahead to develop its coveted deep-water resources (Reuters).

QGEP, a Brazilian oil and gas company, said that it bought 10 percent of an offshore oil block from Royal Dutch Shell, helping expand its holdings in Brazil’s fastest-growing exploration frontier. QGEP is controlled by Brazilian construction giant Queiroz Galvao (Reuters).

At least 350,000 tonnes of North Asian diesel have been booked for shipment to Brazil for loading in the past month as demand for the fuel surges to meet growing industrial activity in South America’s largest economy, ship brokers and traders said (Reuters).


As many as 75 ships were waiting to load sugar at Brazil’s ports in the Center South, the country’s main producing region, one more than a week earlier, according to data from shipping agency Williams Servicos Maritimos Ltda (Bloomberg).

Work in progress at the Acu Superport, being developed by Eike Batista’s LLX. More pictures here.


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