News from Brazil

Brazil Business & Economy News

In Brazil on January 27, 2012 at 11:45 am

ECONOMY

President Dilma Rousseff has made 4 percent economic growth her government’s main mission this year and is willing to cut taxes, take stimulus measures and possibly sacrifice other targets if needed, government sources tell Reuters.

Brazil will make room for a more “flexible” monetary policy as the government seeks to ensure economic growth of at least 4 percent this year, Finance Minister Guido Mantega said (Bloomberg).

Brazil’s unemployment rate fell to a record-low 4.7 percent in December from the 5.3 percent in the same period in 2010, the government’s statistics agency said (Xinhua).

But the Brazilian economy generated 1.944 million formal jobs in 2011, down 23.5 percent from 2010, the country’s Labor Ministry said (Xinhua).

Brazil posted a record-high current account deficit in 2011 on rising profit remittances by multinational companies and massive spending abroad by Brazilian tourists, but the deficit was more than covered by another record, this time for foreign direct investment, the central bank said (MercoPress).

The BNDES’ disbursements closed the year 2011 at R$ 139.7 billion. The result was within the Bank’ expectations and allowed the institution to continue contributing to the expansion of investments in the Brazilian economy, with emphasis on the infrastructure sector (BNDES).

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BUSINESS

Peixe Urbano, the largest Brazilian online daily-deal provider, is loading up on capital, recruiting U.S. engineers and investing in new products to fend off Groupon Inc.’s expansion on its home turf (Bloomberg).

Contax Participacoes SA, Brazil’s largest call-center company, plans to step up hiring and add 12,000 jobs this year to expand in Latin America and into technology help-desk services, Chief Financial Officer Marco Schroeder said (Bloomberg).

What makes an entrepreneur? BBC Brazil’s Julia Carneiro and Tom Santorelli hear from Jacqueline De Biase, 49, who started making her own bikinis at home as a teenager and now runs one of Brazil’s leading bikini brands (BBC).

Brazilians are snapping up luxury goods at a staggering rate. Industry sales were up 33% last year to $12 billion. So one would assume that the big, domestic brands would treat Brazil’s own consumers as a priority. Not Osklen, the sought-after maker of sportswear founded in 1989 by the orthopaedic physician Oskar Metsavaht (Forbes).

AGRI ETC

Brazilian Agriculture Minister Jorge Mendes Ribeiro Filho said he is “not worried” about U.S. testing of orange juice imports for fungicide. The U.S. Food and Drug Administration has started testing juice imports including shipments from Brazil, the world’s biggest producer, for amounts of the fungicide carbendazim that exceed import standards. The FDA had collected 45 samples since Jan. 4, and 12 have been cleared for entry, the administration said last week (Bloomberg).

Orange juice futures barreled to a record high close due to speculation the United States might ban Brazilian juice imports for using a fungicide that U.S. regulations prohibit (Reuters).

AUTOMOTIVE

Germany’s BMW Ag., the world’s largest luxury carmaker plans to build cars in the Brazilian state of Santa Catarina from 2014 reports Automobilewoche (MercoPress).

AVIATION

India’s GMR Infrastructure has withdrawn its bid to modernise and expand an airport in Croatia, but is preparing to bid on similar projects in Brazil, a company official said (Reuters).

The board of directors of the Brazilian Development Bank (BNDES) has approved the basic financial support conditions for public services concessions  in expanding, maintaining and exploring the international airports in Brasilia (Federal District), Campinas and Guarulhos (satellite cities both in the state of São Paulo) (BNDES).

Demand for flights in Brazil has nearly tripled in the past decade. That is straining a system that is under pressure to prepare for the 2014 World Cup and 2016 Olympics. Brazil’s civil aviation agency said demand for air travel rose 194 percent in 10 years. Demand in 2011 alone increased 16 percent over the previous year (Washington Post).

BIOFUELS

Petrobras will invest as much as 28 million reais ($16 million) to expand its Montes Claros biodiesel plant (Bloomberg).

ENERGY

EDP-Energias do Brasil SA and MPX Energia SA, an energy company controlled by Brazilian billionaire Eike Batista, said the country’s power regulator Aneel allowed the companies to postpone the start of operations of the Pecem thermoelectric plant. Energia Pecem, as the plant is known, is located in Brazil’s northeastern state of Ceara, and it’s a joint venture with equal stakes by EDP and MPX. It has an installed capacity of 720 megawatts (Bloomberg).

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SPLIT SECOND POLLS

MINING & STEEL

A Chinese consortium acquired a fifteen percent stake in the Companhia Brasileira de Metalurgia e Mineração (Brazilian Metallurgy and Mining Company, CMBB) in September 2011, it has been revealed, the world’s biggest producer of niobium, a rare and strategically important metallic element (The Rio Times).

OIL & GAS

A Brazilian prosecutor plans to file criminal charges against Chevron Corp and some of its local managers within weeks, adding the threat of prison sentences to an $11 billion civil lawsuit as punishment for a November offshore oil spill (Reuters).

Rolls-Royce Holdings Plc plans to invest as much as $200 billion in projects linked to Brazil’s pre-salt oil reserves, Valor Economico reported. The investment relies on the company winning contracts with Petrobras, building a plant in the city of Rio de Janeiro to produce turbo power generators for oil platforms, and opening a training center close to the factory (Bloomberg).

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