Brazil is experiencing major growth in the construction sector. The country has captured global attention as its major cities undergo a construction boom related to the 2014 World Cup and, specifically for Rio de Janeiro, the Summer Olympic Games in 2016.
The Government of the State of Rio de Janeiro estimates that investments in the State between 2010 and 2016 will reach US$ 50 billion, in sectors including infrastructure, construction, transportation and others. Most of these investments will be done under Brazil’s Public-Private Partnerships (PPPs).
The first-ever Olympic Games in South America will generate numerous business opportunities for U.S. companies in several sectors. The main projects include logistics upgrades at seaports, airport modernization, mass transit build-out, and water sanitation.
Funding for projects will be accomplished with a significant appropriation by the GOB under its “Plan for Growth Acceleration” (PAC). This program encompasses infrastructure investment in logistics, energy, and social services and urban mobility infrastructure.
The Rio de Janeiro Olympic Organizing Committee began their procurement process related to the Olympic Games in early 2014. For further information or to pre-register as a supplier, please visit http://portaldesuprimentos.rio2016.com/en/ . Companies that are pre-registered through the portal will receive information as specific bids are announced.
Other promising areas for U.S. exports and investment include oil and gas, agricultural equipment, building and construction, aerospace and aviation, safety and security devices, IT, medical equipment, sporting goods, environmental technologies, retail, and transportation.
The Brazilian national oil company Petrobras’ expansion plans may represent one of the world’s largest business opportunities in the oil and gas sector until at least 2020. Despite Brazil’s government-mandated local content requirements, industry contacts have been speculating about possible flexibility or compensation mechanisms that they can propose to the Brazilian oil regulator to deal with limited availability of domestic supplies. Petrobras, in fact, may increase purchase of specific foreign goods and services to speed up their projects. In February 2014, Petrobras announced that it would invest US$220.6 billion (approximately US$44 billion/year) from 2014 through 2018, with 70% of this investment being destined for exploration and production (E&P). Brazil accounted for 63% of all deep water oil discoveries in the world from 2005 to 2010. Once these oil fields are developed, Brazil will post the largest oil production growth among non-OPEC countries, sometime in the late 2020s.
U.S. companies incorporating or licensing a business in Brazil must keep in mind that despite Brazil’s recent economic slowdown, several industries are heated and growing and many regional governments are offering generous incentives to foster business investment. Sectors continuing to grow rapidly include cosmetics, pharmaceuticals, oil & gas, security, and direct sales. Meanwhile, several regional governments are offering strong incentives such as free land and significant tax breaks in order to foster investment for the long term.
- Other interesting sectors in which you may find profitable registering a business in Brazil are:
- Public Security and safety
- Direct Sales
- Cosmetics and Pharmaceuticals
- Oil (high sea exploration) and natural gas
- Power and Renewable energy
- Shipbuilding (construction and maintenance)
Furthermore, the biggest country and economy in Latin America has much more to offer. Retail is a market with 200 million consumers. The direct sales industry is heated. Shipbuilding has attracted special importance due to oil extraction and military supplies. Adding to the array of opportunities, the abundance of cheap hydropower and the strong economics of wind and biomass in the country mean that solar has long played fourth fiddle among renewable resources.