Transcript Understanding the Brazilian Market

Understanding the
Brazilian Market
Let the U.S. Commercial Service
connect you to a world of opportunities.
Agenda
Rick A. de Lambert
U.S. Commercial Service
U.S. Department of Commerce,
International Trade Administration
Why Brazil?
U.S. Brazil Trade Relations
Some Best Prospects
Doing Business in Brazil
U.S. Commercial Service -Brazil
Why Brazil?
• Almost 200 million consumers
• Represents half the economy of Latin America
• GDP of $2.5 trillion in 2011 > Russia or India
• Per capita income 2X China and a growing consumer class
• Weathered financial crisis better than most markets
• Shared history, culture, values
Why Brazil?
• 2014 World Cup and 2016 Olympics
• Agricultural Superpower
• Massive pre-salt offshore oil and gas deposits
• U.S. FDI in Brazil (stock) was > $71 billion in 2011.
• Two-way US-Brazil goods trade > $70 billion in 2013
• US goods exports to Brazil totalled $44.1 billion
U.S. – Brazil Trade Relations
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BRAZIL BUSINESS CONCERNS RE THE U.S.
Agricultural Supports (cotton, ethanol, soybeans)
Tariff Rate Quotas (sugar, OJ, ethanol)
U.S. Anti-dumping policies
• U.S. BUSINESS CONCERNS WITH BRAZIL
• High tariffs (20%) and complicated taxes (Up to
60% FOB)
• Enforcement of Intellectual Property Rights
• Onerous licensing and regulatory requirements
• Transparency and bureaucracy
2013 Best Prospects
• Aerospace/Aviation
• Agriculture Equipment and
Services
• Food, Equipment and
Services
• Airports
• Apparel/Textile and
Equipment
• Architecture, Construction
• Engineering Services
• Automotive
• Beauty and Cosmetics
• Biotechnology
• Building Products
• Chemicals and Chemical
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Civil Nuclear
Construction Equipment/Building
Cosmetics
Defense
Drugs and Pharmaceuticals
Educatio n and Traiing
Electrical Power and Renewable
Energy
Environmental Technologies
Financial Services
Food Processing and Packaging
Franchising
General Industrial
Healthcare
Hotel and Restaurants
IT Hardware and Software
Laboratory and Scientific
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Medical Equipment
Mining
Oil and Gas
Pharmaceutical/Nutritional
Processed Foods
Renewable Energy
Retial
Safety and Security
Scientific and Lab Instruments
Services (Professional, Trainin
and Consultation)
Sporting Goods and Recreatio
Telecommunications
Transportation
Travel and Tourism
World Cup 2014 & Olympics 2016:
Business Opportunities
• 12 Brazilian Cities
• Rio de Janeiro
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will host World Cup
Games | Jun-Jul 2014
will host South America’s first Olympic
Games | Aug-Sept 2016
WILL GENERATE
• Numerous trade and investment opportunities in several areas
• From 2010 through 2016, est. US$50 billion
- Infrastructure
- Construction
- Transportation
- Public Security
- Education & Training
• Most through Public-Private Partnerships (PPPs)
under Brazil’s Growth Acceleration Program (PAC)
World Cup 2014 & Olympics 2016:
Business Opportunities
• Potential suppliers to the Rio Olympic
Committee should register at
portaldesuprimentos.rio2016.com/sustentabi
lidade/
$51 billion
$2.7 billion
$3 billion
Infrastructure
Stadiums
TOTAL
Airport Renewals
$56.7 billion
What will the Committee Purchase?
• Temporary Construction for
Sporting Events
• Transportation – Buses, Vans,
Private Cars
• Materials and Services for
Sporting Events
• Contracted Services
• Catering
• Mobile Equipment
• IT
• Marketing/Branding for Games
• Software
• Marketing Services
• Sports Management Systems
• Cleaning and Laundry Services
• Video and Broadcasting Equip
• Portable Office Equipment
• Other
- Sporting Equipment
- Installation
Equipment
- Cruise Ship
Accommodations
- Radio Com.
Equipment
- Public Relations
- Marketing Materials
AEROSPACE & AVIATION
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Market size in 2011: US$ 3.6 M, expected to grow 14% in 2012
US$ 4.6 M in total exports, US$ 2.5 M in total imports in 2011
– US$ 1.5 M (60%) from the U.S.
Source: MDIC – Ministry of Development, Industry & Foreign Trade/ Embraer/ Brazilian Association of Aerospace Industry
 2nd largest general aviation fleet in the world
 Helicopter market increased 15% in 2011
Source: ABAG – Brazilian Association of General Aviation
 Aviation market grew 19% in 2011 compared with 2010
Source: IATA – International Air Transport Association
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Market predicted to expand: 2014 Soccer World Cup and 2016 Summer Olympic Games
Embraer: 1,941 aircrafts ordered in 2011, valued in US$ 16 B.
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Main opportunities:
– Airplane and helicopter parts and components
– Long term: law enforcement segment
AIRCRAFT & PARTS
• In 2012, Embraer delivered 205 aircraft and closed the year with firm orders of 185 aircraft
valued at US$ 12.5 billion. The company produces commercial, military and executive
aircraft.
• On February 27th, 2013, the U.S. Air Force announced the selection of A-29 Super Tucano
manufactured by Embraer for its Light Air Support (LAS) Program.
• Brazil has the 2nd largest fleet of executive aircraft, and the 3rd largest helicopter fleet.
Aircraft imports in 2012 totaled US$ 4.7 bi, an increase of 21% compared to 2011.
Source: Brazilian Association of General Aviation (ABAG)
Marketing Opportunities
• 2014 FIFA World Cup & 2016 Olympic Games should increase the demand for executive
aircraft and helicopters.
• The offshore oil segment where the Brazilian Government is making enormous investments
in the pre-salt oil-fields also presents significant business opportunities for helicopter
manufacturers.
• May 12-16 U.S. Department of Commerce Aerospace Trade Mission to Brazil.
http://export.gov/industry/aerospace/brazilaerospacemay2014/index.asp
DEFENSE
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Market size in 2011: US$ 4.5 M, estimated to grow 6.7% in 2012
US$ 1.1 M in exports, US$ 2.5 in imports in 2011
– US$ 1.1 M (44%) from the U.S.
Source: Ministry of Defense/ Brazilian Association of Aerospace Industry (AIAB)/ Brazilian Association of Defense Material (ABIMDE)
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Government efforts to increase natural resources, borders, and offshore oil reserves
protection
Recent reorganization and modernization of Brazilian Armed forces
Strategic priorities areas: space, cybernetics, and nuclear
Military budget proposal for 2012: R$ 63 M (US$ 37 M)
Best products and main opportunities:
– Army and Airforce:
• F-X2 acquisition program
– Navy:
• Current procurements for ocean patrol vessels, frigates
– Government investment of R$ 2.2 B (US$ 1.2 B) for construction of a launch center,
launch vehicles and satellites
ICT
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Market size in 2012 : US$ 18.9 billion, expected to grow 5% in 2013
2nd largest IT market within emerging economies
5th largest PC market in the world
IT spending expected to increase in the next few years
10% growth in demand for IT software products and services during 2013
Software services market projected to exceed growth of 10% a year until 2015
 Best prospects:
– Continue sales increase for notebooks and smart phones
(smartphones grew 109% and are expected to reach 32 million units in 2013)
– Huge growth of 151% in 2012 for tablets reaching 2 million units.
Brazilian government has tax incentives for local production of tablets (Apple’s only
factory outside of Asia is in Brazil)
– Increasing need of IT Security technology
– Increasing demand for telecom software due to convergence of data and voice
MEDICAL DEVICES MARKET
 Brazilian medical products revenue has shown a 15%-20% increase
per year. In 2012, the medical products market reached an estimated
US$ 16.5 billion, an increase of 4% from the previous year.
 The U.S. accounts for approximately 30% of Brazil’s import market
for medical products, with U.S. sales mainly going through local
agents, distributors and importers who sell to hospitals and clinics.
 May 20-23, 2014, U.S. Pavilion at Hospitalar, Latin America’s largest
healthcare technologies trade fair: 1,250 exhibtors; 90,000 attendees.
Exhibit in the U.S. Pavilion for $6,395. Gold Key Service option.
http://export.gov/brazil/build/groups/public/@eg_br/documents/webcon
tent/eg_br_069113.pdf
COSMETICS
May 12-15, 2014 HAIR BRAZIL, U.S. Pavilion. One of the largest beauty fair
events in Latin America. Contact [email protected]
EDUCATION
 14th largest source of overseas students to U.S. for education and training services
 6th in Intensive English Programs students
Source: Institute of International Education
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8,777 Brazilian students in the U.S. in 2011 - 35% in graduate programs, 46% in
undergraduate programs
“Science without Borders”: Brazilian government exchange program
PROINFO: program to promote technology as important teaching tool
Best prospects and main opportunities:
– Undergraduate and short-term ESL programs
– U.S. colleges and universities offering science courses
– Investment in technical courses for high school students and adults
Challenges:
– Provision of creative financing options in recruitment processes
– Language barrier for Brazilian students
– Strong competition for U.S. higher education institutions
TRAVEL AND TOURISM
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4th largest source of overseas visitors to U.S. in 2011
Top arrivals market for South America (30%)
26% increase in Brazilian visitors to U.S. in 2011 compared to previous year
First in per capita spending of foreign visitors to U.S.
Recent efforts to speed up visa process in Brazil
944,000 visas issued in 2011 – 51% increase over 2010 total numbers
U.S. is Brazil’s second most popular destination
6th in country of origin for visitors to the U.S. during 2011
Most popular destinations: Florida, New York, California, Las Vegas
Majority of visitors travel through travel agencies
May 19-23, 2014 Visit USA Show Brazil (Sao Paulo, Rio, Campinas). Stand alone
travel and tourism event (coincides with events in Argentina & Chile). Participation
options: $3,600; $6,400; $7,800 for one, two, three city options respectively.
TableTop Exhibit and Seminar Presentation. Contact [email protected]
Doing Business In Brazil
• Is complex.
• Requires an intimate
knowledge of local
environment & “Custo Brasil”.
• Best done with qualified local
agent or distributor.
Five CS Offices in Brazil
RECIFE
Eric Olson
Principal Commercial Officer
Email: [email protected]
Phone: 55-81 3416-3075
Fax: 55 –81 3231-1906
BRASILIA
Devin Rambo
Principal Commercial Officer
Email: [email protected]
Phone: 55-61 3312-7403
Fax: 55–61 3312-7656
BELO HORIZONTE
Devin Rambo
Principal Commercial Officer
Email:[email protected]
Phone: 55-61 3312-7403
Fax: 55–61 3312-7656
RIO DE JANEIRO
Alan Long
Principal Commercial Officer
Email: [email protected]
Phone: 55-21 3823-2410
Fax: 55-21-3823-2424
SAO PAULO
Steve Knode
Deputy Sr. Commercial Officer
Email: [email protected]
Phone: 55-11 3250-5429
Fax: 55-11 3250-5343
U.S. Commercial Service
Contact us today to connect with a world of opportunities.
Rick de Lambert
U.S. Commercial Service
U.S. Department of Commerce
International Trade Administration
Email: [email protected]
Phone: 858-467-7032/7041
www.export.gov/Brazil