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Brazil Forecasts Blockbuster Year for Global Investment Attraction, Trade in 2022
Closing Out a Successful and Impactful 2021, Brazil Looks Forward to Increasing Foreign Direct Investment (FDI) This Year Across Real Estate, Infrastructure, Stone and Startup Sectors, Among Others
News provided byApex-Brasil
Jan 26, 2022, 9:00 AM ET
BRASILIA, Brazil, Jan. 26, 2022 /PRNewswire/ -- On the heels of Brazil's strong investment performance in 2021, Apex-Brasil has projected an even more significant increase in 2022 due to the country's robust foreign investment attraction and trade promotion efforts. In the coming year, foreign investors will have the opportunity to bid in 139 Brazilian auctions – a 144% increase from the 57 public auctions held in 2021 – in sectors such as transportation, mining, energy and more. According to the projections of the federal government and Apex-Brasil, Brazil's 2022 portfolio of auctions and concessions will be the largest from any one country in the world, generating an estimated USD $74.4 billion.
In 2021, Brazil's FDI volume reached USD $58 billion – doubling from USD $28 billion the year prior and representing 3.2% of the total Gross Domestic Product. In 2022, Brazil will continue to focus on forging partnerships with existing and new investors in a variety of key of business areas, including real estate; infrastructure; stones, granite, and ceramics; and startups. Below are highlights from each of these high-growth sectors, offering a snapshot of what investors can look forward to in the year ahead:
- Real Estate: The Brazilian government launched an initiative in 2021 to make more than 2,000 federally owned properties available for public auction. By the end of 2022, the government expects the sale of these federal properties will result in USD $18 billion in investments. In fact, the hotel sector specifically is anticipated to boom exponentially – with a projected annual growth rate of 25% through 2026.
- Infrastructure: According to a United Nations Conference on Trade and Development (UNCTAD) report, infrastructure was the Brazilian sector that attracted the most confidence from foreign investors last year, with a 53% increase in the number of financing proposals. In 2022, investors should continue to look forward to infrastructure opportunities in areas like transportation, for example – due to a push from the federal government to privatize transportation concessions specifically, in the coming year there are 25 airport auctions, nine highway auctions, and 18 port auctions scheduled in Brazil.
- Stones: In 2021, Brazil shipped 2.4 million tons of ornamental stone to 132 countries worldwide, with sales totaling USD $1.34 billion – the sector's best-ever performance and a 35.5% increase from 2020. This success was driven in part by the "It's Natural" export incentive campaign, which was developed by the Brazilian Center for Ornamental Rocks Exporters (Centrorochas) and Apex-Brasil to promote the image of Brazil's stone sector worldwide.
- Startups: Brazil has the largest startup accelerator program in Latin America, with over 2,200 successful accelerations. What's more, the country also has the 2nd largest digital transformation program for small and medium sized enterprises (SMEs) in the world, with more than 50,000 companies supported in their digitization efforts since 2020. As a result, from January through October 2021 alone, Brazilian startups raised a record USD $6.4 billion in venture capital funding, tripling the amount raised pre-pandemic in 2019.
Foreign investors will also face a favorable business environment in Brazil in 2022 and beyond. To ensure this, the Brazilian government has introduced a number of reforms, which, in 2021 alone, helped decrease the cost of doing business in Brazil by USD $77.3 billion. Some of the most successful reforms include: the Sanitation Law, which ended restrictions on private sector investments for sanitary projects; Integrated Urban Licensing, which has significantly cut time and costs associated with obtaining a work permit in Brazil; and the New Highway Concession Design, which has introduced an improved risk sharing and incentives framework for new highway development. Upcoming reforms planned in 2022 include the Public-Private Partnership (PPP) Law, Cabotage Law, and Electricity Law – all of which are planned to continue opening opportunities and easing cross-border investing in Brazil.
Over the past year, Apex-Brasil continued to support the work of the Brazilian government and the public sector to enhance the business environment in the country and ready the regulatory framework for foreign investors. Complementary to the Brazilian government's efforts around exports and trade reforms, Apex-Brasil has implemented initiatives to support foreign investors looking to do business in Brazil. For example, Apex-Brasil launched the Brasil Business Match, an online platform that connects international buyers and Brazilian companies. In total, Apex-Brasil facilitated 35 projects in 2021, with an estimated investment return of USD $2.33 billion. To learn more about Apex-Brasil, visit: http://www.apexbrasil.com.br/en/home.
The Brazilian Trade and Investment Promotion Agency (Apex-Brasil) works to promote Brazilian products and services abroad, and to attract foreign investment to strategic sectors of the Brazilian economy. Apex-Brasil organizes several initiatives aiming to promote Brazilian exports abroad. The Agency's efforts comprise trade and prospective missions, business rounds, support for the participation of Brazilian companies in major international trade fairs, arrangement of technical visits of foreign buyers and opinion makers to learn about the Brazilian productive structure, and other select activities designed to strengthen the country's branding abroad. Apex-Brasil also plays a leading role in attracting foreign direct investment (FDI) to Brazil, by working to identify business opportunities, promoting strategic events and lending support to foreign investors willing to allocate resources in Brazil. Apex-Brasil is an agency linked to the Brazilian Foreign Ministry (Itamaraty).
Ruder Finn – PR on behalf of Apex-Brasil in the U.S.
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