Archive for the ‘Economy’ Category

Brazil Real rises 4.7% against US$ in July alone

Posted by Pioneer Land Group in Economy.

Gaining for the 5th month in a row, the Brazilian Real rose 4.7% against the US$ in July. The Real has risen a total of 24% against the US$ in 2009,  the best performer against the US$ out of the 16 most-traded curencies.

“As the Brazilian economy is expanding at a faster pace, foreign investors are snapping up the country’s equities and fixed-income assets” said Gerson de Nobrega, foreign exchange manager at Bando Alfa de Investimento SA.

Brazil’s trade surplus rose 23.8% in the first 6 months compares with the same period last year, as exports reached their highest level since November. Brazil had a $4.6bn trade surplus last month, the biggest since Dec 2006. Read the full report at Bloomberg.

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Brazil Economy to Grow 4% says Barbosa

Posted by Pioneer Land Group in Economy.

According to Bloomberg, Brazil’s economic policy secretary Nelson Barbosa told O Globo newspaper that with falling interest rates he predicts the Brazilian economy to expand up to 4% by end of 2009.

“Brazil will grow 1% < 1.5% in the 2nd quarter compared with the previous quarter” he said. “The Central Bank still has space for more interest rate cuts”.

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Bye Bye G8, Hello G14

Posted by Pioneer Land Group in Economy.

It seems that the combination of the global recession, the imminent rise of the new super powers and the realisation that greenhouse emissions will play a large part in the future global economy, has had a profound effect on the control of our future.

Where once the profound decisions where made by the G8, this fire-side gathering from the 70s (France, Britain, Germany, Italy, Japan and the US, only later joined by Canada and Russia) have finally succumbed to the realisation that they no longer call the shots.

Following the invitation to Brazilian President Lula de Silva to attend the recent G8 summit, numerous discussions were held over which countries are crucial for the decisions that will shape the future of the World. The obvious additions are to be India, China, Brazil and Mexico with South Africa and Egypt likely to attend the final roll-call.

Soon we will have the G14, representing over 80% of the Worlds economy, and so far more relevant when making the most important decisions. Full article on Times of India.

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Brazil ranked 2nd for venture capital investment behind China

Posted by Pioneer Land Group in Economy.

With a stable and modern financial system that has largely escaped the credit crisis, a growing economy and a legal system that respects real estate rights investors see ample opportunity in Brazil, a sentiment echoed by Coller Capital who rank Brazil as the 2nd most attractive choice behind China but ahead of India. At the end of 2008, local and foreign investors had committed $28bn in venture and private equity capital to Brazilian companies, up from $6bn in 2004. Investors have financed over 500 Brazilian companies to date, and there’s $12bn left in the kitty.

Read full report in Business Week.

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Brazil, India and China bounce back together, without the West

Posted by Pioneer Land Group in Economy.

The largest developing economies in the World are rebounding from recession much faster than the developed economies. Indeed for the BRIC this credit crunch has been more of a milestone than a recession, a point in time when the power shift occurred even more rapidly than ever. Whilst western economies continue to struggle, India and China both grew 6% y-o-y to March 09, and Brazil has rapidly regained ground and hopes to post a 4% growth by end 09. Of the BRIC, only Russia has felt the economic shock on a scale even worse than the US, a vast 9% due mainly to its dependency on oil.

So, Russia aside, the “big future three” seem to be getting along fine and seem content to work together and with other developing nations to achieve their goals. China is buying millions of acres of farmland in Africa and South-East Asia, and has overtaken America as Brazil’s largest export market, the latter being incredibly good news for Brazil, who is also now the largest exporter to India. China is using $2trn of its foreign reserves to invest in other emerging markets, an example of which is $10bn going in to Petrobas, Brazil’s state-run oil company.

Importantly Brazil is still not too dependent upon its exports, accounting for only 15% of its GDP … much smaller than developed economies. Investors should look for ways in to Brazil, India and China as their economies rebound and will catch up very fast over the coming decade.

For the full story read The Economist.

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China invests in Brazil more than ever

Posted by Pioneer Land Group in Economy.

More money is flowing in to Brazil in 2009 than the year before, very good news for the Brazilian economy.

In June 09 alone the Central Bank of Brazil reported a surplus inflow amounting to $866 million, four times larger than the net financial outflow of $205 million. A net inflow of $661 million in the first half of June 2009 is much better than the net outflow of $143 million a year ago, but where is all this money coming from, and why?

As China recovers it has been buying goods from countries around the World. Countries it chooses to trade with. China started ordering more goods from Brazil in February of this year and, ever since, Brazil’s economy has been improving. Specifically, China is buying Brazil’s iron ore, airplanes, raw materials and agricultural products.

With a strong central bank at the helm to control inflation and manage these cashflows, we expect even more economic growth stories to come out of Brazil in the next few months.

For a full report see World Currency Watch.

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Brazil President outlines tourism & airline growth

Posted by Pioneer Land Group in Economy.

At the World Travel & Tourism Council’s 9th global summit in Florianopolis last month, Brazil’s President highlighted his commitment to helping the Brazilian Tourism Indsutry.

“We are working hard to convince the international community that bringing the Olympic Games to our country is to recognise that Brazil is on the right road to becoming an even greater nation”. This will follow the important 2014 FIFA World Cup being held in Brazil across 10 major cities, including Natal. “Our government has set aside an investment package for the tourism industry, and have set aside US$304bn in infrastructure including airports, roads and 4700km of railroads.”

President da Silva said his administration is in talks with various governors in Brazil regarding the “creation of a regionalisation policy of the Brazilian aviation. If big companies want to make money doing flights from capital to capital, or Sao Paulo to Paris, it is their right. But Brazil needs to secure flights from an average city to another average city, so that people have freedom of mobility.”

Full report.

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Brazil to grow above global average in 2009

Posted by Pioneer Land Group in Economy.

Brazil’s economy is in a strong position to weather the financial crisis and will grow above the global average this year, Brazil’s Central Bank President Henrique Meirelles said on Sunday. ”We are in the process of reviewing our forecast but our estimate is that we will grow above the global average,” Meirelles told journalists during a meeting of Ibero-American finance officials in Portugal. He said Brazil’s economy was in a strong financial position, with $200 billion in net foreign reserves. “This will allow the country to face scarcity of international finance,” he said.

The government has said Brazil would grow 4% this year while economists think it may be closer to 1.5%. ”Brazil is confronting this crisis in a better position than in the past and more advantaged than many other regions of the world,” he said. Brazil was growing strongly but has been hit by the financial crisis as it experienced a sharp fall in the commodities it sells to the world. Meirelles said domestic demand continued to grow.

Full report from Reuters.

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Mortgages only 2% of the GDP in Brazil

Posted by Pioneer Land Group in Economy.

According to Tom Shapiro, president and founder of GoldenTree InSite Partners, a New York-based real estate investment firm, Brazil is not seeing the distress found in other markets.


“Mortgages account for only 2% of GDP in Brazil” he noted, “versus 65% in the United States and 74% in the UK, so consumers aren’t feeling the effects of credit contraction.” Demand is high, and unlike other markets that have seen rampant speculation, there hasn’t been any overdevelopment.

Shapiro said that his firm typically sees 40 < 50% of condominium units in a given complex sold within two weeks. Recently, GoldenTree sold 70% of the units in an office project in Sao Paulo in only 10 days.

Full article available from Latin Business Chronicle.

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Sam Zell focuses on Brazil

Posted by Pioneer Land Group in Economy.

“If you look at all of the facts, I don’t think there’s another environment in the world that’s better than Brazil.” Sam Zell, Equity International


Zell’s Equity International is focusing heavily on Brazil, which he singled out as a particularly strong opportunity for investment. Like Mexico, Brazil subsidizes low-income mortgages, so consumer access to financing has been largely unaffected by the markets.

The country also has “unlimited natural resources,” and, unlike Mexico, a strong executive talent pool to help outside investors achieve scale in operations.

On the retail side, Zell noted that store sales are up 12% from last year in the malls owned by his group — a stark contrast to the recent U.S. figures. “If you look at all of the facts, I don’t think there’s another environment in the world that’s better than Brazil.”

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Brazil’s Foreign Direct Investment surges in December 08

Posted by Pioneer Land Group in Economy.

Brazil registered its second-biggest monthly flow of foreign direct investment (FDI) in December, pushing the annual total in 2008 to a record, the central bank said. FDI surged to $8.12 billion last month from a revised $2.18 billion in November, helping Brazil post an annual record for FDI of $45.1 billion, the bank said today in Brasilia.

“Foreign investors have a long-term perspective,” Altamir Lopes, head of central bank’s economic research department, told reporters in Brasilia. “They are looking at the fundamentals of Brazil’s economy and are seeing positive perspectives.”

Brazil’s highest monthly FDI occurred in June 2007, when the country received $10.3 billion in FDI. The total for 2008 was the highest since Brazil began keeping records in 1947, the bank said.

Full report available from Bloomberg.

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Brazils registers lowest Unemployment Rate in 6 Years

Posted by Pioneer Land Group in Economy.

As highlighted by the China Daily News, Brazil registered an unemployment rate of 7.9% in 2008, down from 9.3% in 2007, according to the Monthly Employment Study of the Brazilian Institute of Geography and Statistics (IBGE).

The rate was the lowest since the study started in 2002. It measures the unemployment rate in Brazil’s six largest metropolitan regions. In December, Brazil’s unemployment rate was 6.8%, the lowest rate for the month since March 2002, down from 7.6% in November and 7.4% in December 2007. The largest variations in the December unemployment rate were registered in the northeastern city of Recife, where the rate fell 1.9% from November, and in the country’s largest city of Sao Paulo, with a 1.1% reduction.

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Brazil Expected to Weather Downturn

Posted by Pioneer Land Group in Economy.

With emerging markets far from immune to the credit crunch, countries such as Brazil have been outlined by many global experts to experience a far stronger resistance to the crisis. According to the latest assessment by the International Monetary Fund growth in Brazil is now expected to be 3.5% in 2009.

“No country is immune. Six months ago some analysts were claiming that emerging countries would be immune from the financial crises. We did not believe these arguments and we have always said no part of the World was immune.” Said Dominique Strauss-Khan from the IMF. “Brazil is an economy in good shape”, he added “For some countries 3.5% growth would be a great success but for Brazil it represents a major decline”.

Growth in 2009 for advanced economies is predicted at zero so 100% of world growth will come from emerging markets. The IMF expects recovery to start at the end of 2009. Full report from Nu Wire Investor.

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