brazil

This special advertising feature was produced by Insight Publications, a division of Impact Media International Ltd. www.insight-publications.com.

PrOMOTiON // ECONOMiC DEVElOPMENT

In the lead-up to the Rio+20 conference on sustainable development, Brazil is proposing that a number of social and economic goals be adopted for the 2015–2030 period as part of the country’s efforts to export its successful sus-tainability programs to the rest of the world. The concept of sustainability has

gone hand in hand with Brazil’s recent growth: the country closed out 2011 by overtaking the U.K. as the world’s sixth-largest economy. In 2011, while many countries were still struggling to recover from the global crisis, Brazil recorded an estimated 3% growth, maintained low inflation, and saw rising employment and incomes among its citizens. President Dilma Rousseff has vowed that 2012 will be even better, as Brazilians can expect more jobs, opportunities and growth for their country.

The current snapshot of the country shows a far different picture than a Brazil that once suffered from inflation rates of 50% a month. Rousseff is targeting a growth rate of between 3.5% and 5% this year. It’s not just the government that’s feeling bullish, however: The World Bank estimates that Brazil’s GDP will rank among the top five in the world by 2020. Sustaining Brazil’s success rests on several factors, including innovative companies that emerged stronger after surviving the country’s economic downturn through the 1980s and 1990s. Four trends in particular indi-cate that Brazil’s time on the world stage is not ending anytime soon.

Part IV of a serIes

Reprinted from the March 26, 2012 issue of Forbes magazine

MaNaGiNG susTaiNablE suCCEss

PrOMOTiON 2 // brazil

HealtHy DemograpHicsA booming economy needs a lot of

young people to maintain it, and Brazil has them in spades. More than 60% of the country’s population of 195 million people are under the age of 29, and their purchasing power has risen along with their incomes. More than 18 million have recently entered the ranks of the middle class, and the country’s ability to create new consumers for products and ser-vices supports long-term investment. For example, Brazil now has around 1,000 cities with more than 150,000 inhabitants. These new and expand-ing consumer markets have attracted Brazilian companies such as developer WTorre, which has enjoyed an annual growth rate of 20% over the last several years. At the same time, foreign inves-tors such as Mitsubishi, Hyundai and Suzuki have profited from the 3.5 million cars that were sold in Brazil last year. The fact that many of the companies

that survived the lean years are family owned bodes well for their future, as they will be passed along to a younger gen-eration that is developing sophisticated technologies and products and has plans to grow abroad.

infrastructure investmentAll eyes will be on Brazil in 2014 and

2016 as the country hosts first the World Cup and then the Olympics. As it pre-pares to welcome a massive influx of new visitors, thanks to the games, Rio de Janeiro expects to receive about $34 billion in private investments, generat-ing more than 90,000 jobs. In addition to aiding Brazil’s resurgence and increas-ing its global profile, the events have kick-started the kind of infrastructure

improvements the country has needed in order to entice companies to base operations there. For instance, the lack of a public transportation network has long been one of Rio’s biggest prob-lems, with just one underground train line for 6.1 million people. However, Fetranspor is creating new bus routes that will cut travel times by more than 75%, while a new metro line is being built to connect Barra da Tijuca with the rest of the city. The government is also offering $2.5 billion in tax incentives to companies for the expansion of telecom infrastructure in some of the 12 cities throughout the country that will be host-ing World Cup events.

government policiesPresident Rousseff has a tough act to

follow, as her predecessor Luiz Inácio Lula da Silva left office with 7.5% GDP growth in 2010. But rather than being daunted by having to follow in the

footsteps of perhaps the most popular politi-cian in Brazil, Rousseff entered her second year with popularity ratings over 70%. Her govern-ment has maintained and built upon Lula’s success-ful economic policies. Among the government’s biggest priorities is decreasing the number of poor Brazilians. More than 20 million were lifted

out of poverty in the last decade, thanks to policies aimed at building new homes and improving marginalized areas and slums, also known as favelas. Rousseff is looking to increase those numbers with the launch of a national campaign titled, “Brasil: pais rico é pais sem pobreza” (A rich country is a country without poverty). The government also recently announced a readjustment of the income tax rate for individuals that will benefit 25 million taxpayers, while it has simplified the process for starting a small business and continues offer-ing tax breaks to attract investment. Meanwhile, the resignation of seven ministers due to corruption allegations last year is a sign that Rousseff is seri-ous about creating a government that citizens and investors can trust.

stock market growtHThe Bovespa, Brazil’s stock mar-

ket, has come a long way since the

days when only a few companies— like iron ore producer Vale and oil giant Petrobras—were represented and investor participation was minimal. The index posted its biggest weekly gain in a month in early January, when traders moved $2.46 billion in stocks in one day. In addition to making money, the stock exchange is also making a differ-ence in the country by recommending that its listed companies publish regu-lar sustainability reports. The move comes ahead of the U.N. Conference on Sustainable Development that will be held this summer in Rio, where a new all-electronic platform for Brazilian equities will open in the fourth quarter of 2012. The stock exchange, which will be run by U.S.-based market operator Direct Edge, is another sign of the city’s emergence as a global financial hub, while the competition with the Bovespa is expected to drive innovation and price improvement.

Such trends have helped spur a renewed sense of self-esteem among Brazilians. “Brazilians used to prefer imported wine and food products over national ones, but now they are discov-ering that Brazilian gourmet products can be both high quality and a good value,” says Bazzar restaurant owner Andre Paraiso. His establishment now produces and sells gourmet Brazilian products, while other domestic entre-preneurs are going abroad in an effort to expand the country’s presence and brand. For example, sunglasses and accessories brand Chilli Beans is grow-ing its franchises faster in the U.S. due to the cheaper rents, while TVRecord has bought the exclusive television rights for the 2012 and 2016 Olympic Games and the Pan American games in 2015 and 2019. “We don’t just want to be the best channel in Brazil; we want to be the best channel in the world,” says Alexandre Raposo, president of TVRecord Network for Brazil.

At the same time, the company is con-tributing to the sustainability campaign in Brazil with its new headquarters in Porto Maravilha in Rio, which is part of an ongoing project to revitalize the port area with new museums, restaurants, cultural attractions, historic-building improvements, new schools and homes by 2015. In this special section we’ll examine other ways in which sustain-ability is being used to further Brazil’s growth across a number of regions and sectors. v

Construction proceeds on the new National Stadium in Brasilia, which will seat more than 70,000 and is expected to accommodate crowds for the 2014 World Cup and the 2016 Summer Olympic Games.

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PrOMOTiON 3

What is Brazil, aside from the world’s fifth-largest country by population—home to more than 192 million people and counting—and its sixth-largest economy, according to the latest data from the International Monetary Fund? What really defines the country, sets it apart and makes it different from every-where else?

According to global branding consul-tancy Interbrand, Brazil began to carve out an identity of its own in the 1950s. That was when 17-year-old Pelé helped his team win the World Cup for the first time, when Antônio Carlos Jobim and João Gilberto played the first notes of bossa nova, and when the first VW Beetles rolled off the production line in São Paulo.

Half a century later, Brazil’s brand certainly includes the clichés of super-models and soccer stars, beaches and

bikinis, samba and bossa nova, carnival, capoeira and caipirinhas, but it increas-ingly encompasses so much more.

For decades, Brazil concentrated on producing commodities that were transformed into consumer goods else-where. Today, some of the nation’s leading names are capturing the unique combination of beauty, style and imagi-nation that is inimitably Brazilian to create world-class products the rest of the world craves.

Drawing on the wealth of raw materi-als the country has to offer—precious metals, gemstones and tropical woods —and bringing together the best in tra-ditional skills and contemporary design, homegrown businesses are export-ing brands that are recognized and respected globally. Take a look around you, and you’re sure to find something “Made in Brazil.”

a vision of fasHion“I love chillis and have a collection of

spices from around the world. I even eat salad with them,” begins Caito Maia, the CEO of Chilli Beans, Brazil’s hottest sunglasses brand, as he explains how he came up with its name. “Chillis are uni-versal. Everyone knows what they are.”

Maia started out selling sunglasses to his friends and routinely sold out of his stock. He then set up a wholesale sunglasses business, but went bust when sales routinely outstripped supply.

brazil: MakiNG a NaME fOr iTsElfOver the last 50 years, Brazil has gone from commodity producer to consumer-goods producer, building global brands.

luxury & trendsetters:

In Amsterdam Sauer’s boutiques, traditional val-ues and innovation coexist harmoniously, always with the focus on the client’s needs. Amsterdam Sauer has been mining, manufacturing and marketing its fine gem-stone jewelry for more than 70 years in 25 stores across Brazil, and internationally via the Internet: www.amsterdamsauer.com.

“We reach a discerning clientele that appreciates quality over just gen-eral appearance,” says Daniel Sauer, Amsterdam Sauer’s President. “This is a more sophisticated consumer looking for beauty, rarity, exclusivity and good value. Our pieces per-fectly express these assets, and are renowned for their uniqueness, as no two identical gemstones can be found in nature.”

The brand’s history is tied to Rio de Janeiro, from its first store on

Copacabana Beach to the Amsterdam Sauer

Gemstone Museum, which opened in Ipanema in 1989 and showcases a 3,000-piece collection. And it remains a

family affair, with the third generation taking up the

mantle of maintaining tradi-tions while introducing innovation to engage contemporary customers.

Amsterdam Sauer prides itself on making clients feel comfortable, with its multilingual staff even serving caip-irinha cocktails and offering in-store cigar lounges. “Jewels are products for pleasure, passion and entertain-ment,” Sauer insists. “People buy jewelry when they are happy, or want to be happy. So, we make our stores as happy as possible. It’s almost like being at a party.”

aMsTErDaM sauErDaniel sauer of amsterdam sauer shares some thoughts on heritage, success and what buying jewels is all about.

Q: How has being a family-owned enterprise influenced your business?

Our history is the strongest asset of the amsterdam sauer brand. it is our responsibility to always maintain the highest standards of products and services while we search for constant innovation and modernization, but never forgetting where we came from.

Q: what is the secret of your success? There is no simple formula for success.

success can be defined as a combination of a well-planned strategy with harmo-nious and hard work, always bearing in mind that the client is the reason for our existence. We don’t work for us. We are here for them!

Q: last words on the subject?investing in fine gemstone jewelry is

not the same as investing in any other area. Jewels are products for pleasure and passion, not something you buy to resell. for a man, the greatest plea-sure in buying a jewel for a woman is to watch her wearing it.

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PrOMOTiON 4 // brazil

It was only when he got involved with the fledgling Brazilian fashion business that he realized he needed a brand with its own identity and a retail channel he could control.

Chilli Beans was founded in 1997, and today is Latin America’s leading sun-glasses brand. With 400 points of sale in Brazil, including vending machines—and coming soon, trucks—and stores in Angola, Portugal, Los Angeles and Santa Monica, it is about to go global. Maia expects to open 18 U.S. stores in the next 18 months, both in California and Las Vegas, and has plans for another 50 in Colombia.

The brand already counts big-name brands among its partners, having just signed a tech deal with IBM and a partnership with Mattel, with which it produces co-branded Barbie® glasses. The company is now looking to ink new agreements to help expand globally. Maia’s goal is to become “part of the portfolio of global brands in five years,” something he thinks will require at least a thousand points of sale.

Unlike other optical retailers, all of Chilli Beans’ outlets are mono-brand, meaning you won’t see anything other than its own products in the store. Alongside its adult and children’s lines of sunglasses, however, you’ll also find prescription frames, watches, headgear and a few other surprises.

Every week, Chilli Beans launches ten new sunglass designs that in most stores, clients can try on virtually, using a digital mirror that takes a picture of them and then superimposes the style of frame best suited to the shape of their face on their reflection. As their heads move from side to side, the sunglasses move too, showing clients just how they would look in the real world.

If they decide to buy, clients insert a payment card into a slot beneath the screen and, once payment is pro-cessed, their sunglasses are delivered, complete with carrying case. The next step is social-media integration, and Maia already has a database of 500,000 faces and e-mail addresses to keep his customers, both previous and potential, up to date with the latest models.

“You will receive your photo and the next collection every week,” Maia says, “so you can put the glasses on your own face, just for fun. I’m not trying to sell you anything; I’m just trying to ask if you remember us.”

Chilli Beans is about to launch an

enhanced and expanded e-commerce store, which can also be accessed in its retail outlets, that will sell bicycles and other new products. There are, of course, plenty of actual models on display and very enthusiastic vendors to talk to if you’d prefer a second opinion.

“The secret of my busi-ness is people,” Maia insists. “Without people, nobody is anybody. Everybody does product, but if you do not have a smile, nothing works.”

forests full of furnitureFor a nation named after a tree, it’s no

surprise that Brazil is famous for exotic timber. Rosewood, tigerwood, king-wood and tulipwood are among those found in its forests. For decades, they have been the materials of choice for furniture designers worldwide.

In the 1950s and ’60s, the Scan-dinavians used tropical veneers to add luxury finishes to functional forms, while Brazilian designers like Sergio Rodrigues, Oscar Niemeyer and Percival Lafer harnessed hardwoods to craft their curvaceous, comfort-oriented styles.

Now, local brands with global ambi-tions are making huge leaps forward in manufacturing technology, while main-taining the same standards of materials

and craftsmanship that saw Brazilian furnishings find markets at home and abroad.

Sierra Móveis is one homegrown furni-ture maker that, while strengthening its brand presence in Brazil, has its sights set overseas. Focusing on 100% wood products, Sierra has 100 stores nation-wide under franchise partnerships, and aims to open 40 more by 2013 for its new Sierra Garden offshoot.

With three brands—Sierra, Sierra Garden and Abraccio—6 million color

and fabric options, and 98% reforested wood, Sierra Móveis appeals to those who appreciate sustainable materi-als and great design: “We’re looking for premium clients,” confirms Andre Tissot, Sierra Móveis’s president.

After exports foundered in 2008, Sierra Móveis sidestepped external channels and opened its own European distribution center in Amsterdam. It reg-ularly exhibits at the Maison & Objet fair in Paris and maintains an office in Milan. Expansion into the U.S., Tissot adds, is “only a matter of time.”

In 2012, it will invest $30 million to manufacture double-glazed windows and doors, using Italian and German systems, from the same timber it employs to make furniture.

“We must invest in our raw materials, because we have a product few offer: wood,” Tissot continues. “This is where we differentiate [and] what we have to offer to the international market: a prod-uct with its own design, timber from reforestation and quality assurance.”

Luxury cabinetmaker Ornare offers elegant storage solutions for every room and also takes its environmental respon-sibilities seriously. Forest Stewardship Council (FSC)-certified since 2007, its wood comes from sustainable sources and offcuts are transformed into limited-edition works by an NGO partner.

The company adapts its products to suit market tastes, offering Brazilian details to Miami-based clients, and European styles at home. Moreover, Ornare incorporates clever ideas like

Above: Luxury cabinetmaker Ornare offers elegant storage solutions for every room.

Right: Murillo Schattan, president, Ornare

Sierra Móveis incorporates great design and sustainable materials into its products.

A BRANDPHENOMENONWITH BRAZILIANSPICE

"When you create a brandthat resonates with customers they begin to look at it as a guideto what is cool."Excerpt from the chapter on Chilli Beans, on the bookBold: How to Be Brave in Business and Winby Shaun Smith & Andy Milligan.

Chilli Beans is the largest sunglassesand accessories’ brand in South America. Known as a young, provocative and creative retail business, we keep innovatingin the way we involve our customersby launching new collections every weekand enabling them to continuallyreinvent themselves.

We are a franchise chain with over400 stores in Brazil and also in the USA, Portugal, Angola and Colombia.

We want more in Brazil and worldwide.How about spicing it up?

www.chillibeans.com

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PrOMOTiON 6 // brazil

ventilation for humid climates to ensure that its furniture doesn’t just look great, but works well, too.

“We are always concerned with design,” says Murillo Schattan, Ornare’s president, “and look for designers to interact with our product. We also have a design studio and always try to launch something new. We are now starting a Home Collection concept. This is the innovation for this year.”

Founded in 1986, Ornare will open seven stores in 2012 and seven more in 2013. It works closely with Brazilian and U.S. architects, taking them to Art Basel Miami Beach and Fiera Milano to net-work and stay on trend. Sales in Miami are booming as Brazilians buy prop-erty there, and Ornare is now looking at opening in New York, Los Angeles, Chicago and Washington, D.C.

Dell Anno, part of Unicasa Industria de Móveis, is another high-end brand find-ing success abroad, while domestically Brazilians snap up its sophisticated fur-niture products. Its kitchens, bathrooms, bedrooms, closets, home theaters and office environments are sold at 270 deal-ers nationwide, and a commitment to

constant change keeps it ahead of the crowd.

Outside Brazil, the company has 17 exclusive stores throughout Latin America and has been retailing over-seas for a decade. Exports account for just 2% of production, but recent orders, like furniture for 1,600 homes in Dubai, should lead to a big jump in for-eign sales.

As Franck Zietolie, Dell Anno’s direc-tor and president, notes: “Everyone is

competitive. Whoever does not inno-vate is at risk. We have at least two new product releases per year, link our brands with celebrities and use design-ers to develop the collections.”

Dell Anno’s environmental approach is just as forward thinking. All of its wood furniture comes from 100% refor-ested sources and arrives in recyclable packaging. Even the wastewater in its state-of-the-art factory is treated. “We are completely green,” Zietolie confirms.

Above: Franck Zietolie, director and president, Dell Anno

Right: All Dell Anno’s wood furniture comes from 100% reforested sources and arrives in recyclable packaging.

WE HAVE PLANTED AN IDEA:BRING EVERYONE TOGETHER TOCONTROL DEFORESTATION.

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Municipalities

Program has already reached its �rst

objective: gathering most of the

municipalities in a covenant against

deforestation. Almost 90 of the 143

municipalities have adhered to the

program so far. They have commited

to control deforestation and

stimulate the sustainable economy,

among other measures. In exchange,

they will be entitled to tax and credit

advantages. The goal is ambitious:

reducing the deforestation to less

than 35 km2 per year, until it reaches

zero. The idea has fallen on fertile

soil. Now all it requires is to be taken

care of!

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Brazilian Jewelry BranDs sHine With long histories in Brazil, family-

owned jewelry companies have built on the past to give their brands worldwide recognition.

One of the most renowned jewelry companies in Brazil, and with over 47 stores worldwide, Amsterdam Sauer is internationally recognized for its vertical integration into the market. The process starts with mining the gemstones and proceeds to cutting and faceting them, and finally to designing and creating truly fine works of jewelry. The company offers luxury service and aims to expand through the quality of its product.

In 1945, when Hans Stern began mar-keting Brazilian gemstones, there was no market for them. Undeterred, the young German émigré made it his life’s work to see his adopted country’s semi-precious stones recognized as equally precious because of, rather than in spite of, their vibrant colors.

Today, H. Stern—the surname means “star” in German—is a red-carpet sta-ple, worn and even co-designed by actresses such as Catherine Deneuve and Katie Holmes. Thanks to savvy mar-keting, like worldwide warranties and workshop tours; innovative ideas, such as its signature Noble Gold and Stern Star diamond cut; and celebrity caché, it has become a global jewelry brand in constant evolution, with 90 new models every year.

“With each collection, we make our life a bit more complicated,” admits Roberto Stern, the founder’s eldest son, who took the creative and corpo-rate reins in the 1990s. “We are always looking for new materials, textures and colors, and thinking and working with innovation.”

H. Stern has stores in 30 countries, where its creativity sets it apart from other luxury brands. The frontier for future growth lies east, Roberto Stern believes, and he is hoping that Asians will find his jewels just as fascinating as the rest of the world has for over 65 years. v

PrOMOTiON 7

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WE HAVE PLANTED AN IDEA:BRING EVERYONE TOGETHER TOCONTROL DEFORESTATION.

GR

IFF

O

The Green

Municipalities

Program has already reached its �rst

objective: gathering most of the

municipalities in a covenant against

deforestation. Almost 90 of the 143

municipalities have adhered to the

program so far. They have commited

to control deforestation and

stimulate the sustainable economy,

among other measures. In exchange,

they will be entitled to tax and credit

advantages. The goal is ambitious:

reducing the deforestation to less

than 35 km2 per year, until it reaches

zero. The idea has fallen on fertile

soil. Now all it requires is to be taken

care of!

GREENPROGRAMMUNICIPALITIES

GOVERNMENT

“We are always looking for new materials, textures and colors, and thinking and working with innovation.”

Roberto SternPresident and Creative Director, H.Stern

PrOMOTiON 8 // brazil

Rio de Janeiro is about to step into the spotlight: Three global events will be held in the city over the next four years. To create the best impression possible, the city council, public organizations, private-sector partners and Cariocas, as Rio’s residents are known, are doing their best to ensure that Brazil’s second city shines.

This June, hundreds of high-level delegates will convene in the city for Rio+20, the United Nations Conference on Sustainable Development. In 2014, Maracanã stadium will host the final of the FIFA World Cup soccer tournament. Two years later, the eyes of sporting fans from around the world will turn to Rio again for the 2016 Olympic Games.

With a population of 6.3 million, and 6 million more in its greater metropolitan area, Rio de Janeiro is the sixth-largest city in the Americas. While less affluent per capita than São Paulo—Brazil’s big-gest metropolis, which is home to almost twice as many people—Rio is catching up where it counts. Rio attracted $7.3 billion in FDI in 2010, which is seven times more than 2009, and, crucially, twice as much as São Paulo.

Brazil’s economy expanded 7.5% in 2010 before sliding back 3.5% in 2011

due to reduced Eurozone demand. Recent growth and an influx of capital have helped the Brazilian real to stretch further, making Rio much more acces-sible to rising local incomes.

The authorities are also concentrat-ing on making Rio a safer place to live, work and visit. Urban renewal projects are bringing vital services to the hillside favelas, home to as much as 20% of the population. Clinics, nurseries, schools and community policing are making the streets safer, which means that those in and near the shantytowns are enjoying improved living standards and seeing property values rise.

Companies such as Rio-based hair treatment brand Yenzah are quick to rec-ognize that a new class of consumers is becoming upwardly mobile. Consumers want better products to improve their

appearance and social position, say Rodrigo Goecks and Marcelo Chrispim, the company’s founders.

learning valuaBle lessonsThere have been surprising domino

effects from Brazil’s success in secur-ing host-nation status for the 2014 FIFA World Cup and the 2016 Olympic Games. For example, the Ministry of Education (MEC) is working to ensure that more Brazilians are granted access to a university education. This will give them the training needed to apply for the thousands of new jobs both events will create.

The MEC lists 137 higher-education institutions in the Rio de Janeiro state, of which 80 are in the city itself. Many have designed courses and signed agreements with institutional and private-sector partners to provide the kind of qualifications required. At the same time, the state’s Secretary of Tourism, Antonio Pedro Figueira de Mello, announced last year that more than $860,000 has been set aside to subsidize additional classes.

At present, more than 6 million Brazilians are enrolled in tertiary educa-tion, but the government aims to have 10 million in college or studying for a degree via distance learning by 2015. Today, around 40% of those leaving secondary school go on to university, and the goal is to reach 50% by the end of the decade.

One seat of learning that will be instru-mental to achieving those goals is Gama Filho University (UGF), Rio’s second-largest university, with 3,000 graduates a year earning bachelor’s, special-ist, master’s and doctorate degrees. With roots going back to 1939, UGF has three campuses—Piedade, Barra-Downtown, and Centro-Candelária—and offers every thing from architecture to nursing and from law to petroleum engineering.

“The big challenge in Brazilian edu-cation is to have sustainable and long-lasting growth,” says Professor Márcio André Mendes Costa, UGF’s dean. “We educate fewer professionals than we need, and not as efficiently or as well as we would wish. The federal government is trying to tackle these problems, [and we are] following the Ministry’s goals.”

Training people to produce a suffi-cient quantity of high-quality workers is something clearly dear to Mendes

rIo de JaneIro:

GiViNG riO a faCElifTCurrent public and private endeavors are transforming the city and creating a new class of consumers.

“The big challenge in brazilian education is to have sustain-able and long-lasting growth.”

Professor Márcio André Mendes Costa Dean, Gama Filho University

The Maracanã stadium is being renovated ahead of the 2014 World Cup soccer tournament.

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PrOMOTiON 10 // brazil

Discover our tourist destinations:www.santur.sc.gov.br

Discover a paradise with a 560-kilometer coastline with perfect waves for surfing and that each year becomes a nursery for right whales. It’s a place with rich gastronomy, rivers for rafting, gorgeous waterfalls and breathtaking views. Come to Santa Catarina, the best tourist destination in Brazil.

AF ASA 0025-11AN REV FORBES 174x124mm.pdf 1 13/01/12 16:22

Costa’s heart. For him, this means closer cooperation with businesses to adapt theoretical education to the practical needs of enterprises, and greater rein-forcement of initiatives that help get as many people as possible into higher education.

These initiatives include pro-grams like PROUNI scholarships and FIES financing, which allow those who cannot afford to do so to study, while providing incen-tives to choose courses that benefit the country in the long term. The government offers subsidies for those signing up for math and languages at pri-vate universities like UGF, if they agree to teach in the public sector within two years after completing their degree.

Likewise, UGF has developed courses with corporate partners to provide professional training. Its mechanical engineering labo-ratories were paid for via a deal with Mitsubishi; its IT courses are industry-supported; and it works

with Petrobras to offer optional courses that impart expert train-ing for petroleum exploration.

“The advantage [for students] is a great chance of getting jobs,” Mendes Costa says. “For the company, they can take people already trained, and they do not need to invest any more. That is why universities have to work with private companies.”

Beyond working with compa-nies, UGF now wants to generate innovations and has created an incubator to develop them. It will choose 12 projects, mostly in engineering and IT, and will support research leading to new technologies and patents.

UGF’s dean is also enthusi-astic about working with other institutions and recently signed a partnership with the University of East London to offer sports busi-ness management and branding courses. London’s 2012 Olympics experience will help Rio prepare professionals to host the games in 2016, Mendes Costa says. v

Dean mendes costa speaks of his efforts to shape ugf into a university with a unique brand:

Q. How do you attract top-notch profession-als to the university staff? A. We pay our professors 25% more than the national average, combined with incentives, good communication channels and a positive atmosphere. Q. How has the university evolved internally in recent years? A. We have been ahead of the trend to have busi-ness professionals as well as academia shaping our curriculum. Including people from civil soci-ety is one of our major management differentials. Q. UGF is a brand identified with entrepre-neurship. How does that affect Brazilian society? A. When you offer a person an education, you are also developing a better citizen: a citizen who can adapt to a constantly changing market, and learn how to reinvent himself inside of that market.

According to data from SIMBA2, a road-transport research collaboration between the European Union and the emerging markets of Brazil, Russia, India, China and South Africa, traf-fic accidents in Brazil kill more than 34,000 people every year. They also leave about 300,000 injured, and about a third of those suffer perma-nent disabilities.

Pedestrians and bystanders are disproportionately affected, being the victims of more than 75% of accidents that occur in some urban areas. In 1974, federal legislation cre-ated compulsory third-party liability motor insurance, known as DPVAT,

to cover personal injury arising from vehicle accidents. And, since 1997, Seguradora Lider has been responsi-ble for making certain that everybody’s insurance is not only paid, but that it also pays up.

More than 51 million vehicle own-ers are obliged to pay premiums to Seguradora Lider, amounting to around 6.7 billion reals ($3.75 billion) every year. Of this, 45% is paid to the public health system and 5% to DETRAN, the national department of traffic. The remaining 50% is retained by the insurance consortiums to settle damages.

“We are an insurance company that provides coverage for the entire popu-lation of Brazil,” says Ricardo Xavier, DPVAT’s director and president. “We are trying to reach Brazilian society to explain that payment of insurance is an obligation for the owner of the vehicle and also a right of citizens. Any foreigner who suffers a car accident in Brazil, caused by a Brazilian vehicle, is entitled to use the insurance. Everyone is insured.”

PrOMOTiON 11

sPOrTs aND busiNEssThe business of sport represents

only 1% of Brazil’s GDP, while in most countries it accounts for up to 5%.

This means there is a huge mar-ket that has yet to be tapped by sports industry companies, says Hélio Viana, a banking executive who has 25 years of experience in sports business.

In September, Viana is staging World Sports and Business in Rio, an international trade fair aimed at promoting the opportunities open to international companies with the potential to benefit from the sports sector in Brazil.

In addition to organizing the World Sports and Business fair, in which the Portuguese-headquartered Banif Investment Bank is a partner, Viana will pro-vide advice, consultancy and support for companies that have the potential to benefit from major forthcoming sporting events in Brazil. He emphasizes the impor-tance of having a local partner and how this can help foreign compa-nies succeed. w w w. s i e r r a . c o m . b r

will be exhibiting at

2012

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PrOMOTiON 12 // brazil

POrTO MaraVilhaPorto Maravilha plans to return Rio’s port to its former glory, bringing busi-

nesses, residents and visitors back to where it all began. The Porto Maravilha Urban Operation is Brazil’s biggest urban rehabilitation, covering 1,200 acres, and is managed by CDURP (the Port Area Urban Development Company) under a public-private partnership that aims to ensure positive results for all concerned.

“We invest in the area, improve the infrastructure and add value, which attracts investors,” CDURP’s CEO Jorge Arraes explains. “By law, all money raised here, stays here, and we run it. This provides security for the investor. For the city council, it generates jobs and tax revenue and improves the town.”

For Arraes, Porto Maravilha compares favorably to Barcelona, which hosted the 1992 Olympics. The first two phases will be complete by 2015, putting util-ity networks and a new traffic system into place and adding 15,000 trees. The Museum of Tomorrow and Art Museum of Rio will help transform the run-down neighborhood into a cultural hub. Porto Maravilha will then be primed for inves-tors to develop homes, hotels, offices and leisure facilities to serve a population expected to reach 100,000 within a decade.

“We have opportunities in hospitality. Rio de Janeiro has a shortage of accom-modations. The market is heating up, and it offers a clear opportunity and very strong demand. The entertainment area will also be a big draw for entrepre-neurs. In our minds, this is no longer just a port,” says Arraes.

Before and after: the proposed restoration work on the sheds of Gamboa

For the last 35 years, the aptly named Óticas do Povo (People’s Optical) has been providing the people of Brazil with an unrivaled choice in eyewear. The company has constantly invested in technological change, but continues to offer the same high-quality prod-ucts and personal service at affordable prices that have been its hallmark from day one.

According to Manoel Pessanha, the company’s founder, respecting three core values is vital to his business’ success: quality, because caring for clients’ visual health means Óticas do Povo cannot be negligent; service, because he was brought up to treat everyone respectfully and cordially; and fair prices, because his target

market is less affluent, and “we have to sell our products without making exaggerated profits.”

His formula clearly works. With a market-leading network of 84 stores serving Rio de Janeiro, Minas Gerais and Espirito Santo, Óticas do Povo just opened its first outlet in Florianópolis in Santa Catarina, and plans to reopen 12 recently acquired stores by April. It is now aiming to expand into Rio Grande do Sul and Paraná, thanks to a $33 million investment in 45 new stores, and has its sights set on São Paulo by 2015.

“Brazil’s population is currently about 195 million people, of which 130 million people really need to wear glasses,” Pessanha says. “Unfortunately, only 45 to 50 million people use them. Selling glasses is a market that will continue to grow, in line with the growth of our economy.” v

aN EyE fOr ExPaNsiONa focus on making quality eyewear accessible to all

PrOMOTiON 13

WhaT CariOCas arE WaTChiNGBrazil’s second-largest TV network has scooped up rights to global sports events, making it and Rio the center of attention.

Rede Record has been broadcasting since 1953, and started out as Brazil’s first choice for sports. Fittingly, hav-ing purchased exclusive international rights to the London 2012 and Rio 2016 Olympic Games, as well as the 2015 and 2019 Pan American Games, the network will soon become the world’s window onto the decade’s biggest sporting events.

This culminates a reinvention that began in the nineties with a content overhaul, skewing toward popular programming like telenovelas to suit changing tastes, and continued through 2004 under the slogan “On the way to leadership.” From 2006 to 2011, its turnover in Rio de Janeiro grew 424%.

“We shook things up a bit,” admits Thomas Naves, the network’s marketing director. “We made our product visible...then restructured human and material resources. Next was changing public perception. We made a major invest-ment in Rio de Janeiro, showing the market we are thinking big.”

Today, Rede Record is Brazil’s sec-ond-largest network and is aiming for the top. The success of its programming stems from the fact that it broadcasts the “real” Brazil, with local news and shows recorded in the streets. Its $290 million, high-tech RecNov studio com-plex, built with recycled materials and powered by renewable energy, employs 2,500 people.

“We can really approach the Cariocas when we talk about the city,” confirms Carlos Geraldo Santana, the network’s president. “When people speak well of Rio, they are also speaking well of the people. TV Record represents Rio and its people.” v

Carlos Geraldo Santana and Thomas Naves

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enVIronment

builDiNG a bETTEr brazilRapid growth will not come at the expense of natural wonders and quality of life.

No matter who wins the 2014 World Cup, host country Brazil already appears likely to claim at least one title: Greenest Games. While the country is racing to build and renovate 12 stadiums for the event, Jose Roberto Bernasconi, presi-dent of the Association of Architecture and Consulting Engineering Companies, says that all building plans must take environmental sustainability into account. Toward that end, builders are hoping to exceed even FIFA’s standards when it comes to reducing carbon emis-sions and using green materials such as solar panels, recycled stadium seats and rainwater sprinklers. For example, 6,000 solar panels will be used to light the Governor Magalhães Pinto sta-dium in Belo Horizonte, as well as 1,500 nearby homes. Similar solar projects will be undertaken at stadiums and airports ahead of the Olympics.

Such efforts demonstrate Brazil’s new commitment to ensuring that its rapid growth does not come at the expense of its natural wonders and quality of life. The country has been widely praised by the international community for its envi-ronmental sustainability efforts, with the World Bank recently approving a $50 million loan for the development and adoption of cutting-edge technologies and practices in the mining and energy sectors. The World Bank will then adapt the resulting best practices for other developing countries.

Brazil is also at the forefront of inno-vative concepts such as a market for trading environmental assets, the first of its kind in Latin America. Based in Rio, the market will trade assets such as straight carbon credits. In addition to healing the planet, such efforts are also helping Brazil’s bottom line, especially in the fast-growing biofuels sector.

Last year’s expiration of U.S. import tariffs and tax credits now opens up the American market to Brazilian sugar- distilled ethanol, which is considered more environmentally friendly since it uses less land and fewer fossil fuels than

American corn ethanol. The expected increase in demand for Brazilian ethanol has already led state-run development bank BNDES to earmark up to $22 bil-lion to finance the expansion of the sugar-cane sector, while growers are looking at smarter, more-efficient tech-niques such as crop rotation.

Meanwhile, Brazilian governments are working to combat sanitation issues. For example, São Paulo state water utility Sabesp plans to invest nearly $1 billion in sanitation projects in 2012, including expanding the potable water supply service and developing waste water treatment and collection coverage. Other smaller municipalities are carrying out similar efforts this year, such as a $10 million investment by northeastern Ceará state utility Cagece.

tailor-maDe for tHe Brazilian truck market

Last year, Man Latin America was rated the top company for licensing trucks in Brazil, the ninth-consecutive time it has achieved that position. The company also saw its highest revenues in 30 years last December, and is planning to invest more than $1 billion between 2012 and 2016 to expand its operations in Brazil. Such funds also will go toward the continued development of the hybrid Volkswagen Constellation truck. The automaker and Petrobras have also signed a partnership to develop alternative-fuel projects.

Customers and business leaders voted Man President and CEO Roberto Cortes Automotive Leader of the Year in 2011, just a year after Cortes was honored as Person of the Year for 2010 by the Association of Sales and Marketing of Brazil and readers of Autodata. Perhaps above all else, Brazilians appreciate that Man customizes its products for its customers, working locally and offer-ing affordable prices. Its partnerships, including one with Volkswagen, and innovation in areas such as hybrids and modular consortium management sys-tems, have also helped make it popular both at home and internationally.

According to Cortes, Man’s business growth must be accompanied by social growth. “We are growing at a rate of 15% per year. In 1999 we sold 12,000 units; this year we’ll sell 70,000. We are coming from a market share of 15%, and we are now above 30%. Yet you only become perennial if you take care of the social environment.” For this reason, Man is investing in biodiesel, especially

as Brazil’s vast farmland gives it greater opportunities to succeed in this area.

While Man has been Brazil’s leading producer of trucks since its purchase of the Volkswagen division, it is facing competition from American, German and Swedish companies entering the Brazilian market. Cortes says he is confident in Man’s continued ability to better understand its customers’ needs and offer the most service support. “Our autonomy is greater since our engineer-ing is located here in Brazil. We are able to change a Volkswagen product the way our customer wants faster than our competitors. We are doing just what the customer wants, and this ensures our sustainability.”

As Man expands, it is seeking new partners; an example is its recent collab-oration with synthetic biology company LS9 to test renewable diesel on Brazilian vehicles. “Our business model is based on production partnerships, business development, product development and new technologies,” Cortes says.

“We benefit from what others have, and the synergy does the rest.” Cortes also believes that Man has the expertise in agriculture, biofuels and hybrid technol-ogy that investors need, as well as the kind of local connections and knowl-edge that comes from years of domestic success. “I think the biggest advantage of being Brazilian is being familiar with the country’s culture, the country’s needs and the people’s behavior.”

Such advantages will come in handy, as investor interest is unlikely to decrease anytime soon. “The economy is growing fast, so I think investors have many opportunities to invest here,” Cortes adds. “This is a place where you have political and social stability, a strong economic system and a solid financial system. Brazil is the place of the moment and will remain so.”

Continued on page 16

“Our business model is based on production partnerships, business development, product development and new technologies.”

Roberto CortesPresident and CEO, Man

Driving the leading truck and bus company in Latin America?We are your MAN.

How do you become the leading truck and bus manufacturer in Latin America? By offering the perfect solution for individual needs. That is why our trucks can transport goods from XS to XXL and also across any terrain. Regardless of whether you are driving on a newly built motorway, in a congested city environment or across country, one of our truck models will be right for you. MAN Latin America is respon-sible for VW Trucks and Busses in Latin America. See what else MAN can move at: www.man-la.com

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PrOMOTiON 16 // brazil

looking to tHe countrysiDe for agriculture growtH

As Brazil looks to increase sugar culti-vation to meet expanding biofuel needs, NovAmérica will likely help lead the effort. It is the market leader in sugar, with its agricultural branch cultivating 6.6 million tons of sugarcane a year, while its service branch recently began providing services for other groups, including the cutting, transporting and planting of sugarcane.

However, such work must comply with the company’s environmental policy, which requires that waste from sugar manufacture be used as organic fertilizer,

and that water used in processing be recycled and reused. The company’s commitment has earned it a Certificate of Environmental Compliance from the São Paulo state government, while its Future Project, created in 1987, passes down these values through environmen-tal-related activities for young people.

NovAmérica President Fábio de Rezende Barbosa believes the biggest opportunities for production are not in the big cities but in the less-inhabited areas in the countryside, which is where his company is focusing. Barbosa is planning to double the company’s size within the next five years. He is seek-ing out new business relationships, similar to the partnership that resulted in NovAmérica’s 2008 merger with sugar and ethanol processor Cosan Group. The two companies combined their sugar operations at the Santos Port in São Paulo, allowing them to ship 8.5 mil-lion tons of commodities per year.

notHing wasteD in solutions for Brazil’s sanitation neeDs

A growing economy that generates more jobs and products also generates

more waste; but what many Brazilians consider to be garbage, engineer-ing firm Solvi sees as energy. The firm provides sanitation and waste manage-ment solutions in 160 cities throughout Brazil and five municipalities in Peru, with a mission to generate energy where it is possible. Its investments in envi-ronmental sustainability have included adoption of new technologies, waste-water treatment, water reuse and gas emissions monitoring. Solvi has part-nered with universities to develop new clean technologies and raise awareness of environmental issues.

Solvi is keenly aware of the impact it can have on the people of Brazil as well. For example, when the company closed down a garbage dump in Bahia and opened a new facility in its place, it hired some 90 unemployed locals as recyclers.

According to Solvi President Carlos Leal Villa, “Every businessman already thinks financially; what they need to do is also think environmentally and socially. That is a big challenge for Brazil,” he says. Villa believes that as the country grows, so will the need for investment in waste management. v

Continued from page 14

NovAmérica maintains environmentally conscious sugarcane cultivation.

PrOMOTiON 17

oPPortunItIes

brazil’s NEW frONTiErsEmerging markets offer fresh potential for investment.

The north, northeast, southeast and central regions of Brazil are proving to be the favored new frontiers for foreign investment this year. Both multinational and national companies are realizing that these emerging markets offer the freshest potential in South America’s largest economy.

In 2011, foreign direct investment into Brazil reached a record $66.7 billion. Until recently, 85% of this was focused on the wealthy southern states of Rio de Janeiro, Rio Grande do Sul and São Paulo, but international investment ana-lysts are deducing that there are other equally attractive targets elsewhere in Brazil, especially in states such as Goiás, Pará, Santa Catarina and Rio Grande do Norte.

As their economies grow, all four of these states are actively improving their infrastructure, especially their sewage and sanitation systems; are expanding their tourism sectors; and are receptive to inward investment.

goiásGoiás is in the center of the country,

just 130 miles west of the national capi-tal, Brasilia. The state is about the size of Finland, with a slightly larger popula-tion of 5.7 million.

Mitsubishi, Hyundai and Suzuki are already established in Goiás, attract-ing components industries to the sector. Rekkof, the Dutch aeronautical

company, is setting up a major plant to develop its new Fokker 100 airliner in Anápolis, the state’s third-largest city.

Goiás is an open state with a dynamic approach to economic expansion that welcomes foreign as well as Brazilian capital investment and public-private partnerships, says Marconi Perillo, the state governor, who is currently serving his third term.

“We give about 60% tax exemption for businesses to settle here in an attempt to create more jobs and stimulate the economy. With thousands of direct jobs increasing the revenue of municipali-ties and the state, we are starting a new project to train 500,000 people.”

In addition to accounting for 45% of Brazil’s total agricultural production, Goiás is the primary source of food, ser-vices and consumer goods for Brasilia’s burgeoning population and is becoming a new industrial and logistical hub for the country through its increasing north-south and east-west rail links.

An 1,800-mile railroad connecting the country’s northern and southern regions is due to be completed next year, and more than 500 miles of it runs through Goiás, making the state an ideal logisti-cal center for countrywide trade.

The railroad will link Itaqui, Brazil’s largest cargo port, which is located on the northeast coast, to the state of Rio

Marconi Perillo, governor of Goiás, looks at an aerial view of the Ribeirão João Leite dam project.

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Grande do Sul on the country’s south-ernmost tip. On its route through Goiás, it will pass through Anápolis.

Lying midway between the state capi-tal of Goiânia and the national capital of Brasilia, Anápolis has the fastest- developing industrial sector, with sev-eral high-tech companies as well as major food processing and pharmaceu-tical plants.

The east-west railroad will link Bahia on the east coast with Lucas do Rio Verde in Mato Grosso state and con-tinue on to the Pacific coast.

Governor Perillo has orchestrated a huge investment in Goiás’ infrastructure and logistic facilities. Gross domestic product was $9.7 billion in 1999 and has now reached $62.4 billion.

“Goiás’ economy is growing at more than the national average, and last year it grew at the same rate as China,” he says.

The governor believes strongly that attracting foreign as well as Brazilian capital is the way to continue grow-ing the state’s economy. Management purely by the state is an outmoded con-cept, he says. “We want transparency, quality services and results. Goiás is now

the ninth-most-important state in Brazil, and we believe that in 20 years it will be the fifth most important,” says Perillo.

With the support of the federal gov-ernment, the Goiás administration is investing $1.1 billion in water and sani-tation projects. Together with federal and private-sector partners, the state also is completing a light rail transit sys-tem worth $745 million and has plans for the four major state highways involv-ing investments of $1.4 billion.

Goiás also has a river port on its southern border that provides a navi-gable waterway to the South Atlantic.

“With good state and federal high-ways as well as these rail and river links, we have great logistics across the state,” says Perillo. The Goiás adminis-tration also is committed to reorganizing power supplies and investing $687 mil-lion in energy distribution, substations and energy lines.”

paráIn the north, Pará is Brazil’s largest

state and a gateway to the Amazon rain forest. Known for the wonders of the Amazon river, a local folk dance known

as carimbó and its indigenous culture, Pará has untapped tourism potential.

The Agropalma Group, which pro-duces and markets edible oils and biodiesels, and the major energy com-panies, Petrobras and Vale, are investing in Pará. These companies see abundant growth potential there for palm kernels and soybeans that yield a very rich and low-cost biodiesel fuel.

In addition to its plant life, the rain for-est’s natural resources enable Pará to export rubber; hardwoods like mahog-any; and minerals such as iron ore and bauxite, manganese, limestone, tin and gold. These natural resources also are used to generate hydroelectric power.

Governor of Pará Simão Jatene points out that, in spite of the obvious high value of Pará’s plentiful natural resources and amazing biodiversity, the per capita income of its 7 million-strong population is only half the national average.

“It is unacceptable that a state that is the second-biggest exporter in the coun-try has a per capita income equivalent to half of the country’s average,” he says. Jatene adds that congressional dis-cussions are under way to remedy this imbalance by reforming the tax system.

Another project—Municípios Verdes, or Green Municipalities—is aimed at changing the way the state territory is used. “We want to use the soil in a self-sustaining way by reducing the area used for livestock and stimulating good agriculture.

“Above all, we want to avoid defor-estation and preserve natural areas, selecting some areas for intensive use and others for eventual use,” says Jatene. “Since the instigation of this

Administradora do Seguro DPVAT

DPVAT is the traffic insurance that protects all Brazilians who are victims of accidents on the roads and streets of our country: for pedestrians, passengers and drivers alike. The invaluable help DPVAT provides Brazilians is evidenced by the more than 250 thousand claims paid last year alone. And there’s more: DPVAT gives 45% of its revenue to help the Public Health System (SUS) cover the costs of caring for traffic accident victims, and 5% to the National Traffic Department (Denatran) to use in traffic education campaigns, giving millions of Brazilians more peace of mind.

www.dpvatseguro.com.br DPVAT. THE TRAFFIC INSURANCE.

DPVAT INSURANCE PROTECTS THE COUNTRY’S GREATEST ASSET:

190 MILLION BRAZILIANS.

DPVAT Insurance Administrator

Continued on page 20

The Municípios Verdes project in Pará has helped to reduce deforestation in the region by 40%.

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PrOMOTiON 19

iNVEsTiNG iN ThE sEEDs Of GrOWTh

While the mood of optimism in Brazil is attracting big investors, it can be dif-ficult for smaller investors to access the market. But for investors of all sizes who want to make a difference as well as a profit, Global Forestry Investments (GFI) is well situated to assist them by sim-plifying the process of investing in the reliable and high-performing sustain-able forestry sector.

The company was founded in 2007 by Andrew Skeene and Omari Bowers, who decided to develop trees rather than houses when they noticed that for-estry investments had grown at a rate of 20% per year over the last couple of decades. After starting with a small plot of land in Mato Grosso, the pair real-ized that trees planted on overlooked farmland could be an even more reliable commodity than gold. Since then, GFI has purchased land and planted trees in emerging markets, giving investors the opportunity to buy sections of the land. When those trees are sold, investors

can see a return of up to 20% of their investment.

Such a long-term investment can be ideal for both large and small investors, with GFI providing the local know-how to handle problems like clearing titles or dealing with bureaucracy. “We make it simple for investors from the U.K. or Europe,” Skeene and Bowers say. “It’s pretty difficult to land in a country and undertake the due diligence and know what solicitors to go to. Intelligence is the key, and we have very strong con-nections within Brazil.” The company’s offices in São Paulo, London and Dubai are also advantageous for foreign inves-tors. “For example, a lot of people from the UAE are seeking to invest heavily in Brazil now, so we can act as a bridge for them,” they explain.

The company is contributing to refor-estation efforts in Brazil by planting a tree in a protected area for every tree an investor purchases. It is also giving back by providing funding for a school and performing arts centers. Looking ahead, the company is investing in eucalyp-tus trees and working with universities to create new medicines, in addition

to creating a new $300 million equity fund. “The opportunities are endless in regard to infrastructure and agriculture. For instance, one of the areas we are pushing is sugarcane, because there is a huge demand for ethanol. There are a lot of opportunities in agriculture, infra-structure and forestry, and we want to align ourselves with the right people to take advantage of them.” v

GFI founders Andrew Skeene and Omari Bowers

PrOMOTiON 20 // brazil

program, we have already reduced deforestation by 40%.”

santa catarinaIn the south of Brazil, Santa Catarina

is experiencing increasing interest from investors and record growth of its exports. Although it is the smallest state in the southern region, it recorded $2.9 billion worth of sales abroad in the first six months of last year—20% more than in all of 2010.

Raimundo Colombo, the state gov-ernor, is confident of similar figures this year: “International companies are betting on Santa Catarina’s potential,” he says, “including the Spanish paper and cardboard manufacturer Europac, which is going to build a new factory here, and GM, which is opening a new engine industry plant.”

In addition, notes Colombo, Santa Catarina is home to German automo-tive supplier ZF; the international fish processing company Gomes da Costa, whose Santa Catarina plant is consid-ered to be the largest fish capture and

sorting installation in Latin America; and a Siemens medical factory. “We have strong policies to attract new investors,” Colombo explains. “We offer improved infrastructure, business opportunities and fiscal incentives such as reduced taxes, and our businesspeople are very dynamic, organized and globalized.”

On hand to assist new investors in Santa Catarina is the First S.A. Group, a company that has two decades’ worth of experience in assisting foreign com-panies with the procedures required for importing and exporting.

Brazil is a complex country, especially in regard to taxation, which is where First S.A. Group can help, says com-pany President Natanael de Souza. “Brazilians will best understand the Brazilian legislation and how a foreign product can be brought into the country at the best cost.”

First S.A. Group, which focuses on importation, storage and distribution, has its own warehouses, hires com-panies to transport goods, and has affiliates in São Paulo, Espirito Santo and Tocantines.

“Currently we have customers from

all over the world,” says de Souza. “We handle the importation of Italian boats, luxury goods, helicopters and other aircraft, with the majority of products coming from the Far East.”

In addition to business, Santa Catarina is famous for the unspoiled beaches and lagoons along its 350-mile coastline as well as its forested mountains, folklore and food. It is now the country’s third-most-popular tourist destination.

Santa Catarina also is a major industrial and agricultural center, with the competi-tive advantages of six air and sea ports and a highly qualified labor force.

With its economy thriving, the state’s 6 million residents enjoy one of the high-est standards of living in the country.

rio granDe Do norteRio Grande do Norte, which is situated

in Brazil’s northeastern corner, is Brazil’s most sought-after investment area, and is experiencing capital growth of 20% annually. Today, more than $19.5 billion is being invested by the federal, state and private sectors in oil, gas and wind energy; mining; transportation; tourism; and sani-tation infrastructure development.

A new airport, scheduled for comple-tion next year, will have the largest cargo terminal in Latin America and the capac-ity to handle 40 million passengers a year.

“Rio Grande do Norte is the best loca-tion in Brazil to build a cargo airport,” says State Governor Rosalba Ciarlini. “We are just three hours from Africa, six hours from Europe and seven from New York. All flights going to Africa, Europe and the U.S. pass through our airspace.”

The state is Brazil’s second-largest petroleum producer, the largest pro-ducer of salt and a leading exporter of a wide array of fish species and agricul-tural crops.

“Now, more than ever, the northeast has all the potential for further develop-ment and offers opportunities for foreign investors,” says Ciarlini, who is a medi-cal doctor. Her particular ambition is to extend sewage and sanitation facilities throughout the state.

“When I was mayor of Mossoró, my home city, I increased sanitation ser-vices from 8% to 60% of households, and I’m determined to do this for all of Rio Grande do Norte. My goal is at least 80%. This is work that often is not vis-ible. But for me it has always been a personal project, which I consider to be fundamental.” v

Continued from page 18

http://www.sic.goias.gov.br

PrOMOTiON 22 // brazil

InsightP U B L I C A T I O N S

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PROMOTION

Brazil, land of the samba, Sugar Loaf Mountain and

Copacabana beach, is also distinguishing itself in the midst

of the worldwide financial crisis by the resilience of its e

co-

nomic performance.

In the face of the global slowdown, the Brazilian econ-

omy is predicted to grow this year by a relatively respectable

2.5%. Last year, the South American nation achieved the

notable feat of being the least affected by the international

economic downturn.

Although business activity in Brazil slowed gradually

through the last six months of 2008, its economy maintained

an overall growth rate estimated at 5.2%. This was a more

substantial performance than that of any of the world’s most

developed economies.

Significantly, domestic demand, rather than exports, has

been the main driver of Brazil’s growth. While highly

unequal income distribution continues to be a major prob-

lem in this nation of almost 200 million people, it is the coun-

try’s burgeoning middle class that has fueled the economy’s

expansion.

The highest-earning 10% of the population comprises

20 million people, and households with an annual dispos-

able income of more than US$7,500 increased from 42.7%

to 57.1% between 2005 and 2007.

For the first time in a generation, Brazilians have been ben-

efiting from stable economic growth, low inflation rates and

improvements in their social well-being.

BRAZIL

Continued on next page >>

Despite the global economic gloom, this Latin American giant

is enjoying growing prosperity, tax cuts and increased productivity.

confidence is the keyword

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PROMOTION

When the name of the host city for the 2016 Summer OlympicGames is announced in Copenhagen on October 2, there

is a good chance it will be Rio de Janeiro.In its fifth bid to stage the world’s greatest sporting event, Brazil’s

cultural and commercial capital has made the final short list, alongwith Chicago, Tokyo and Madrid.

If the Olympics do come to Rio in 2016, it will provide an enor-mous boost for Brazil’s international prestige, and it will be thefirst time that the Games have been held in South America.

There are good reasons to believe this may happen. Rio’s stag-ing of the XV Pan American Games in 2007 was highly success-ful and proved that the city has the facilities and know-how tohandle such a major international event.

Furthermore, Brazil is scheduled to host the FIFA World Cupsoccer competition in 2014, which in several previous instanceshas acted as a trial run for hosting the Olympics. Mexico stagedthe World Cup in 1968 and the Olympics in 1970; Germany didthe same in 1970 and 1974; and the U.S. followed suit in 1994and 1996. Carlos Nuzman, the president of the BrazilianOlympic Committee, provides an even more persuasive reason forRio’s selection: “Our budget is bigger than the others’, becausewe have made clear what we need to do and we have the money,”he says.

All three levels of government – federal, state and city – havegiven guarantees that if Rio is declared the winner, work will begin

the next day with $700 million in immediate funding. They havealready provided $42 million to fund the bid to host the Games.

Much of the required infrastructure is already in place, and thegovernments are spending $4 billion to build more. The Olympicmovement is presenting Rio – and Brazil – with a historic oppor-tunity, says Nuzman.

“It can have a new city, a new country and a new continent,where the Olympic Games have never been staged before. It willalso be ideal for reaching young people. Brazil has 65 million underthe age of 18, and the continent has 180 million. These young peo-ple will be getting a very strong perspective for the future fromthe Olympic Games.”

Winning the bid to host the Olympics would further underlineand strengthen Brazil’s increasing international stature. Nothingillustrates Brazil’s progress better than the fact that the SouthAmerican nation is to become a contributor rather than areceiver of IMF handouts.

Just five years ago, Brazil owed the IMF $33.9 billion. Yet todaythe Brasilia government is lining up as a potential purchaser ofa bond designed to increase funds available to economically strug-gling nations.

“Isn’t it chic that Brazil is lending money to the IMF?” com-mented Brazilian president Luiz Inácio Lula da Silva with delightwhen he heard the announcement. �

By Michael Knipe

Already set to host the FIFA WorldCup soccer contest in 2014, thisbooming South American giant isa favorite to stage a futureOlympic Games.

writing the next chapter

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Brazil2-09-alt_forbes 3/10/12 2:17 PM Page 1

PROMOTION

Brazil’s economy is surging upward,

fueled by the vitality of its domestic market,

newly discovered oil resources and major

infrastructure development as the country

prepares to host soccer’s 2014 World Cup

and the 2016 Olympic Games.

With economic growth predicted to be

above 5% this year, business opportunities

will benefit from the creativity and flair for

design and innovation that are ingrained in

the Brazilian national character and

enhanced by the country’s newfound

financial fitness, telecoms talent and entre-

preneurial energy.Brazil has a long-established status as a

cultural icon. The exuberance of its multi-

ethnic citizens; the magic of its music,

from samba to bossa nova; and the organ-

ized chaos and color of its Carnival — all

of these express Brazilian brilliance.

These days South America’s boldest and

most ebullient nation is making its mark on

the global economy.Fashion weeks in São Paulo and Rio de

Janeiro now rank among the world’s pre-

mier fashion events alongside those in New

York, Milan, London and Paris.

Foreign prejudices against Brazil have dis-

appeared in the past three years, says

Mario Spaniol, the founder of Carmen

Steffens, which sells its handcrafted shoes,

handbags and accessories in 23 foreign

countries. “These days we are proud to say

that we are a Brazilian brand, and we have

180 stores worldwide.”The increasing global reach of the Carmen

Steffens brand and the optimism Spaniol

expresses typify the current mood of Brazil’s

business community. Signs of growth in the

U.S. and Chinese economies are boosting

confidence in Brazil because they are the

South American country’s second-largest

export markets.With the nation preparing to host the

World Cup soccer competition in 2014 and

the Olympics in 2016, the government’s

Growth Acceleration Program has pumped

$250 billion into infrastructure projects.

Foreign direct investment is set to jump

a whopping 48% this year to $38 billion,

according to the median forecast of about

100 economists in a central bank survey car-

ried out in February.The recent discovery of huge offshore oil

deposits near Rio de Janeiro will further pro-

mote future growth, transforming Brazil into

one of the world’s biggest oil producers.

As domestic demand for steel rises,

Usiminas, Brazil’s largest producer of flat

steel, is boosting investment 33% this year

to ramp up output, and may revive plans

to build a mill in the Minas Gerais state.

With all these developments in the

pipeline, utilization of industrial capacity has

been increasing every month. Further, merg-

ers and acquisitions are forecast to rise as

much as 40% this year, as the buoyant con-

sumer market and the government’s steps to

foster homegrown conglomerates increase

the attractiveness of corporate combinations.

Both the government and independentContinued on next page >>

creatively coming out ahead

BRAZ

IL

Brazil3x_forbes 3/10/12 2:20 PM Page 1

brazilMaNaGiNG sustaiNable success

This special advertising feature was produced by Insight Publications, a division of Impact Media International Ltd. www.insight-publications.com.

PrOMOtiON // ecONOMic DeVelOPMeNt

In the lead-up to the Rio+20 conference on sustainable development, Brazil is proposing that a number of social and economic goals be adopted for the 2015–2030 period as part of the country’s efforts to export its successful sustainability programs to the rest of the

world. The concept of sustainability has gone hand in hand with Brazil’s recent growth: the country closed out 2011 by overtaking the U.K. as the world’s sixth-largest economy. In 2011, while many countries were still struggling to recover from the global crisis, Brazil recorded an estimated 3% growth, maintained low inflation, and saw rising employment and incomes among its citizens. President Dilma Rousseff has vowed that 2012 will be even better, as Brazilians can expect more jobs, opportuni-ties and growth for their country.

The current snapshot of the country shows a far different picture than a Brazil that once suffered from inflation rates of 50% a month. Rousseff is targeting a growth rate of between 3.5% and 5% this year. It’s not just the government that’s feeling bullish, however: The World Bank esti-mates that Brazil’s GDP will rank among the top five in the world by 2020. Sustaining Brazil’s success rests on several factors, including innovative companies that emerged stronger after surviving the country’s economic downturn through the 1980s and 1990s. Four trends in particular indi-cate that Brazil’s time on the world stage is not ending anytime soon.

Part IV of a serIes

For more information about the fifth report

in this series on Brazil, please contact:

Gabriel Gutierrez — G.Gutierrez@impact-media.com