BRAZIL MEANS BUSINESS

Transcription

1 BRAZIL MEANS BUSINESS Export Green Trade Mission II: Energy & Environment April 23, 2012 Miguel Hernández Commercial Officer, CS Brazil

2 U.S. Foreign Commercial Service Market Intelligence to help U.S. exporters target the right markets for their products and services Trade Counseling to provide them with the information they need to navigate the export process from beginning to end Business Matchmaking services to connect them with the right partners and prospects Trade Advocacy for U.S companies to level the international playing field for international procurement

3 TRADE ISSUES

4 TRADE ISSUES

5 TRADE ISSUES

6 Shipment Stuck in Customs

7 FCS Activities Trade Missions Average about 1 a month Visits President Obama Governors Members of Congress

8 U.S. Brazil Smart Grid Initiatives 8

9 Brazil LEED Certifications

10 Brazil LEED Certifications

11 Energy Efficiency Cooperation Buildings consume 50% of the electricity produced in Brazil and advanced building envelope materials can help curtail this growing electricity demand. Brazil s building construction is experiencing a boom and the demand for supply of power for more people in more buildings is increasing rapidly. We have agreed to share technical information that will support the establishment of an independent testing facility in Brazil to provide efficiency ratings that accurately reflect the real-world performance of building materials, including high-efficiency windows, cool roofs, and advanced insulation. 11

12 Why Brazil? 200 million consumers with increased purchasing power GDP of over US$2 trillion in 2010 > Russia and India Per capita income 2x China s Weathered financial crisis better than other world markets. Strong agricultural sector

13 Why Brazil? Oil and gas growth could equal North Sea US$57 billion FDI in 2009 Goods trade between the US and Brazil was US$59 billion in In 2010 US exports to Brazil totaled US$35.4 billion an increase of 35.5% from 2009.

14 Forecasts vary, but sometime in the decade after 2014 Brazil is likely to become the world s fifth-largest economy, overtaking Britain and France. The five largest economies in the world in 2050, measured in GDP nominal (millions of USD), according to Goldman Sachs. [18]

15 World Cup 2014 and Olympic Games 2016 Business Opportunities -Rio de Janeiro will host the first-ever Olympic Games in South America August- September Brazilian cities will host the the 2014 World Cup Games. -These two events will generate numerous trade and investment opportunities in several areas.

16 World Cup 2014 Investments - BRAZIL WORLD CUP 2014 (Held in 12 Brazilian Cities) Infrastructure: US$ 51 billion Stadiums: US$2.7 billion Airport renewals: US$3 billion TOTAL: US$56.7 billion (Not including the High Speed Train Rio/Sao Paulo, which might not be ready by 2014, and which is valued at US$20 billion)

17 Doing Business In Brazil Is complex! Requires an intimate knowledge of the local environment, including Custo Brasil. Best done for SMEs through a local agent or distributor. This is valid whether your company is a bank, a realtor, an engineering firm or any type of industry or service provider.

18 IPOD INDEX

19 Hypothetical Cost Buildup for an Imported Machine in US Dollars FOB price of Product 100,000 Freight 2,400 Insurance (1%) 1,000 CIF Price of Product 103,400 Import Duty Rate: 19% -- applied to CIF 19,646 IPI: 5% -- applied to CIF + import duty 6,152 ICMS: 18% -- applied to CIF + import duty + IPI 23,256 Merchant Marine Tax: 25% of ocean freight cost 600 Warehouse: 0.65% of CIF; or min. US$ 170, max US$ Terminal Handling Charges: average US$ 100 per container 100 Contribution to Custom Broker's union 2.2% CIF; or min of US$ 71, max US$ Custom Brokerage Fee: average 0.65% of CIF or min US$ 170, max US$ SISCOMEX Fee 30 Typical Cargo Transportation charge 35 Typical Bank Costs: 2% of FOB 2,000 FINAL COST 156,064

20 Transportation Logistics costs Transportation costs In dollars per ton BRAZIL USA ARGENTINA Estadao Newspaper, Aug. 2010

21 Infra-structure Matters in Brazil BR US Difference Soy production costs dollars cheaper in Brazil Transportation costs dollars cheaper in U.S. Port costs dollars cheaper in U.S. Total dollars in favor of USA Conclusion: To produce soy in Brazil is 51 dollars cheaper than in the US. But the logistics costs not only eliminate this advantage but inverts the equation. At the end, it is 24 dollars cheaper export from the US than Brazil. Source: Veja Magazine Aug/07

22 Energy

23 Thank you! Miguel Hernández Commercial Officer Phone: Fax: