Brazil: A Promising Market - CCMM · Brazil: A Promising Market Frederico Marques PhD & LLM...
Transcript of Brazil: A Promising Market - CCMM · Brazil: A Promising Market Frederico Marques PhD & LLM...
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Brazil: A Promising Market
Frederico Marques
PhD & LLM International Law
Partner & Foreign Legal Consultant, McCarthy Tétrault
Chairman, Brazil-Canada Chamber of Commerce
February 27, 2014
Doing Business in Brazil.
Presentation at the Board of Trade of Metropolitan Montreal.
DOCS #13208457
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Summary
1. Brazil Country Profile
2. Brazil History
3. Brazil Economy
4. Brazil and Canada Overview
5. Brazil & Canada, Stage of Development
6. Brazil & Canada, Most Problematic Factors for Doing Business
7. Why Brazil?
8. Brazil’s Major Opportunity Sectors
9. Doing Business in Brazil, Strategy Background
10. Doing Business in Brazil, Strategy
11. Tips for Doing Business in Brazil
12. Other Helpful Survival Hints
13. Government Assistance & Chambers of Commerce
14. Brazil in Pictures
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1. Brazil Country Profile
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QUICK FACTS:
Name: Federative Republic of Brazil
Population: 199.3 million (2012 est.)
Capital: Brasilia
Largest city: Sao Paulo
Other cities: Rio de Janeiro, Salvador, Belo Horizonte, Recife
Area: 3.3 million sq miles
Currency: Real
GDP: $2.477 Trillion (2011)
Main exports: goods, iron ore, steel, coffee
Main imports: motor vehicle and aircraft parts, goods, computer, coal
Language: Portuguese
Religion: Roman Catholic (74%)
Life expectancy: 69 years (men), 76 years (women)
Business Hours: Between 8-9am and 5-6pm
Time Difference: Currently 1 hour (3 hours during Canadian winter)
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2. Brazil, History
¬ Discovered: 1500 (Portuguese Colony)
¬ Independence: 1822
¬ Republic: 1889
¬ Democracy: 1988 (Brazilian Constitution). Full democracy. Political
Freedom
¬ Economic Stability: 1994 Real Plan
¬ 3 latest President:
¬ Fernando Henrique Cardoso
¬ Luis Inácio Lula da Silva
¬ Dilma Rousseff
¬ Legal System: Civil Law
¬ Diverse and vibrant culture
¬ Growing middle class
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Click on the BBC
icon below for a
chronology of key
events in Brazil
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3. Brazil, Economy
A country of opportunities:
¬ Exports: $201.9 billion (2010 est.)
¬ Export Commodities: Transport equipment, iron ore, soybeans, footwear, coffee, autos
¬ Export Partners: China 12.5%, US 10.5%, Argentina 8.4%, Netherlands 5.4%, Germany 4.1%
(2009)
¬ Imports: $181.7 billion (2010 est.)
¬ Import Commodities: machinery, electrical and transport equipment, chemical products, oil,
automotive parts, electronics
¬ Import Partners: US 16.1%, China 12.6%, Argentina 8.8%, Germany 7.7%, Japan 4.3% (2009)
¬ Rich in Natural resources
¬ Economic Stability & Sound financial system
¬ Economic growth with social inclusion
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4. Brazil & Canada Overview
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Key Indicators 2011 Brazil Canada
Population 199.77 35.7
GDP (US Billions) 2,492.9 1,736.9
GDP per capita (US$) 12,789 50,436
Total Area 8,511,965 9,976,140
Source: The Global Competitiveness Report 2012-2013.
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4. Brazil & Canada Overview
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Source: Statistics Canada & Worldbank.
Foreign Direct Investment (FDI) 2007 2008 2009 2010 2011 2012
Canadian direct investment in Brazil 7,687 9,873 8,560 10,321 9,923 9,844
Brazilian direct investment in Canada 13,974 14,492 13,177 17,261 14,527 15,810
Total FDI Received (including Canadian) 2009 2010 2011 2012
Argentina 4,017 7,845 10,719 12,128
Brazil 31,480 53,344 71,538 76,110
Chile 12,887 15,373 22,930 30,323
Colombia 7,137 6,745 13,403 15,649
Mexico 16,604 22,562 23.553 15,453
Peru 6,430 8,454 8,232 12,244
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4. Brazil & Canada Overview
Bilateral Trade (Key Latin America Countries):
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Source: Statistics Canada & Worldbank.
Canadian Exports to
Canadian Imports from
2010 2011 2012
Argentina (Exports) – 52nd 283,912,051 495,296,185 299,285,104
Argentina (Imports) – 24th 1,555,466,710 2,358,743,431 2,220,436,467
Brazil (Exports) – 10th 2,562,516,295 2,840,773,794 2,577,735,120
Brazil (Imports) – 12th 3,292,396,758 3,889,357,698 4,019,572,205
Chile (Exports) – 27th 587,467,384 818,777,576 788,903,462
Chile (Imports) – 31st 1,872,339,204 1,910,900,301 1,677,144,344
Colombia (Exports) – 26th 642,275,006 760,898,384 827,017,480
Colombia (Imports) – 47th 717,265,857 799,347,127 664,348,978
Mexico (Exports) – 5th 5,008,227,557 5,476,572,667 5,370,808,088
Mexico (Imports) – 3rd 22,111,307,640 24,571,767,569 25,494,919,289
Peru (Exports) – 32nd 476,446,467 516,425,590 535,965,022
Peru (Imports) – 15th 3,619,097,966 4,402,676,766 3,683,499,916
Imports: Canadian imports from such country. Exports: Canadian exports to such country.
Catalog Sources World Development Indicators (http://data.worldbank.org/indicator.NY.GDP.MKTP.CD)
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5. Brazil & Canada, Stage of Development
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Source: The Global Competitiveness Report 2012-2013.
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6. Brazil & Canada, Most Problematic Factors for Doing Business
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Source: The Global Competitiveness Report 2012-2013.
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7. Why Brazil?
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¬ World’s largest exporter of iron ore, ethanol, coffee, soy beans, orange juice, beef, chicken and sugar
¬ World’s largest river basis and freshwater reserves.
¬ 3rd largest aircraft manufacture
¬ 3rd largest biodiesel market
¬ 5th largest land mass
¬ 6th worldwide vehicle manufacture
¬ 7th largest economy
¬ 10th largest petroleum reserves
¬ Greatest biodiversity on the planet
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8. Brazil’s Major Opportunity Sectors
¬ Higher than average growth : ¬ Transportation,
¬ Telecom,
¬ Oil and Gas; and
¬ Mining
¬ Other leading sectors for exports and investments include:
¬ Agricultural Equipment
¬ Aerospace and Aviation
¬ Information Technologies
¬ Telecommunications
¬ Electrical Power
¬ Medical Equipment
¬ Safety and Security
¬ Environmental Technologies
¬ With the World Cup 2014 and the Olympics in 2016, Brazil is spending billions in
infrastructure development with its roads, railroads, ports and airports as well as in stadiums
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9. Doing Business in Brazil, Strategy Background
¬ Immense potential as a trade and investment partner
¬ One of the most promising and exciting major developing markets
¬ In many sectors Brazil is already a well-developed market
¬ Competitors are already there and that competition is fierce
¬ Use your competitive advantages to the full
¬ Important to know which competitive advantage will be the most effective in Brazil
¬ Research the market to identify the level of demand for your product/services
¬ Decide how to address the market
¬ Your initial research should tell you:
a) what is the market for your product/service in Brazil?
b) should you be targeting particular niches or the market as whole? and
c) can you be competitive in Brazil and what is your competitive advantage?
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10. Doing Business in Brazil, Strategy
¬ Partnering with local companies
¬ M&A
¬ Joint Venture (corporate v. contractual)
¬ other type of association or commercial representation
¬ Local knowledge and experience brings advantage that you should consider
¬ Set-up a legal entity (vehicle for your investment)
¬ Type of structure (limited liability company? Corporation? Branch?)
¬ Tax (Canadian and Brazilian point of view. Regional Tax Incentives, Free Trade Zones)
¬ Labour (high cost)
¬ Regulatory (highly regulated, foreign exchange controls)
¬ Investors (where are they? Capital cost?)
¬ Corporate Social Responsibility
¬ Compliance with Brazilian legal framework (advanced planning is key)
¬ Contact the Canadian Embassy and Consulate. Canada has a strong presence
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11. Tips for Doing Business in Brazil
Brazil is not for Beginners (O Brasil não é para principiantes) - Tom Jobim
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¬ Long Term Commitment (plan, plan & plan)
¬ Personal Relationship (Relationship comes first, second & third). For friends everything... for enemis the law!
¬ Know the language & Understand the culture
¬ Being late is normal! Expect people being late (work and social) life)
¬ Don´t get right down to business. Take time to greet and say good-bye to each participant
¬ Body language! Physical contact is part of communication! Touch arms, backs is normal. Woman kiss twice (once on each cheek together with a shake of hands)
¬ Brazilians like foreigns, but be nice to them. No arrogance allowed!
¬ Be prepared to be interrupted when you are talking. It is not rude in Brazil.
¬ Verbal communication. Eye Contact. Becareful with some gestures (Ok!)
¬ Emails are not answered on the same speed as in North America
¬ Appearances count.
¬ Make sure you are dealing with decision maker
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12. Other helpful survival hints
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Business
¬ Do not plan to make a business visit or schedule any appointments during holidays or festivals
¬ Make appointments 1-2 weeks in advance (not a month or two)
¬ If you meet a colleague during the weekend, make sure to greet your colleague
¬ Gifts are not important in establishing a business relationship, and people wont expect it
Social/Business
¬ Always entertain in a prestigious restaurant. Be prepared for lengthy meals
¬ Brazilians always wash their hands before eating and rarely touch food with their hands
¬ When inviting Brazilians to dinner or a party:
do not suggest that your guest bring food or drink
do not expect them to arrive on time (15 -30 minutes late).
do not indicate at what time the party will end
¬ Brazilians are extremely casual about time:
10-15 minutes late is normal
15-30 minutes is not unusual
Arrive on time for a formal meeting and prepare to wait for your Brazilian colleagues
¬ Send flowers before or after visiting someone’s home for dinner or lunch
¬ Football, family, Brazil’s beautiful beaches and the country’s rapid growth are appropriate conversations
(be careful when talking about politics and religion).
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14. Government Assistance & Chambers of Commerce
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Country
Apex Brasil Brasil
Brazilian Embassy in Ottawa Canada
Brazilian Consulate and Trade Office in Toronto Canada
Brazilian Consulate in Montreal Canada
Brazilian Consulate in Vancouver Canada
Brazil-Canada Chamber of Commerce Canada
Câmara de Comércio Brasil-Canada Brazil
Canadian Embassy in Brasilia Brazil
Canadian Consulate in São Paulo Brazil
Canadian Consulate in Rio de Janeiro Brazil
Canadian Trade Office in Belo Horizonte Brazil
Canadian Trade Office in Recife Brazil
Canadian Trade Office in Porto Alegre Brazil
DFAIT offices in Quebec City & Around Canada Canada
EDC Offices in Rio de Janeiro & São Paulo Brazil
EDC Offices in Canada Canada
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14. Brazil in Pictures
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Thank you for your attention!
&
Enjoy your time Doing Business in Brazil.
Be ready to have a lot of fun and work hard!
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