10 Good Reasons to Invest in Brazil
There are many reasons why it makes sense to invest in Brazil. Here are some of them:
- Brazil is rich in natural resources. It is the world’s 4th leading producer of iron ore (prized by major manufacturing nations) and also has large reserves of timber, water, copper, uranium, tin, aluminium, platinum and coal.
- The 2014 World Cup and 2016 Olympic Games are driving improvements in transport infrastructure and tourism, thereby raising property prices.
- Brazil has the 5th largest agricultural output in the world and is the world leader in bio-fuels exports.
- Brazil is self-sufficient in oil and is likely to become one of the world’s top 5 oil producers in the coming years. It is also self-sufficient in energy, producing 85% of its energy requirements through renewable resources.
- Growing economy – Brazil is currently the 6th largest economy in the world, having overtaken the UK in December 2011.
- Through its Growth Acceleration Programme (PAC2) the Government will invest US$582bn in infrastructure, housing, transport and urban renewal projects between 2011 and 2014.
- Brazil’s banking sector is in a secure condition with conservative regulatory standards (high reserve rate and low leverage ratios) and Government finances are healthy - low level of public debt - an annual budget surplus.
The investment opportunity
- In 2010 Brazil was the world’s 5th largest recipient of Foreign Direct Investment and the North East of Brazil is the No.1 area in the country in receiving international investment
- Growing Mortgage Market – Currently total mortgage values represent only 2% of the Brazilian GDP, however this is expected to reach 12% of GDP by 2014, thereby increasing property values across the country.
- Investment in Brazil provides a natural hedge against inflation due to the relatively heavy weight of commodity producers in the broader economy.
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"2012 will be the year of investment in Brazil", Guido Mantega, Brazil Finance Minister
“Brazil has managed itself well over the last 10 years, and got itself into a uniquely strong position for the future.” Warren Buffett, July 2011
Facts & Figures
Brazil has the world’s 7th largest reserves of currency and gold
Brazil has the 5th largest agricultural output in the world