Infrastructure and Investment Committee promotes the connection between Canadian investors and the many possibilities of projects all over Brazil
By Estela Cangerana
Infrastructure works, concessions of ports, airports or highways, investments in health, urban mobility, oil and gas, sustainable energy, and sanitation. These are just a few examples of the many business opportunities that are opening up for private enterprise in several Brazilian states. In many of them, the Canadian experience can be an important advantage, which is beginning to be recognized by regional governments. Since the first half of last year, meetings promoted by the Infrastructure and Investment Committee of CCBC (IIC) with state secretaries and Canadian investors have been serving as a link for a prosperous relationship.
“The states are very much engaged in their concession and bidding programs. We have noticed the interest in seeking foreign investors and, among them, Canadians, who have a long tradition of investing in infrastructure in Brazil”, says IIC coordinator Bayard Lima, senior vice president of investment at Brookfield. At the other end, the business possibilities presented by state governments have been welcomed by Canadian entrepreneurs. “The meetings have been revealing an immense number of opportunities in different locations”, he complements.
The IIC’s agenda in 2020 included meetings with secretaries from São Paulo (April), Paraná (August), Bahia (September), and Rio Grande do Sul (November). Presentations of state projects are already scheduled for 2021 by the secretaries of Ceará, Mato Grosso, and Pará, among others. “CCBC has been serving as a great channel of communication to show the real opportunities in Brazil for potential investors from Canada,” explains Lima. According to him, the objective is to intensify this work, including the possibility of future missions between the two countries.
Brazil is the largest receiving country of foreign direct investment (FDI) in the Latin American and Caribbean region, and the sixth largest in the world, according to World Investment Report of 2020, from United Nations Conference on Trade and Development (UNCTAD). The data, referring to the year 2019, indicate that US$ 72 billion in foreign direct investment (FDI) entered the country that year, an increase of 20% compared to 2018.
According to the report, among the main reasons for this attraction were the opportunities in the segments of oil and gas, and energy, in addition to the broad privatization program launched by the federal government. During the first nine months of 2019, Brazil raised about $20 billion through privatizations and disinvestments, US$1.4 billion in infrastructure concession payments, and about US$3 billion in “natural asset sales”, which mainly refer to Petrobras’ oil exploration areas.
Besides the opportunities offered by the federal government, there are many regional projects, such as the concession of the Ferroeste railway, and the airports of Bacacheri (Curitiba), Foz do Iguaçu, Londrina, and the Afonso Pena International Airport (São José dos Pinhais), all from Paraná. In Rio Grande do Sul, some of those projects are the privatization of real estate assets and of Companhia Riograndense de Mineração (a mining company), the concession of environmental parks, and of Cais Mauá (Mauá Pier). In several states, the sale of energy companies, sanitation service concessions, and nearly 8,000 kilometers of roads. These are just a few examples, which represent a movement that should intensify in the coming years, motivated by the need to stimulate the country’s economy, and promote development, at the same time as governments rely on restricted public budgets.
At the other end, Canada is cited as the sixth largest global investor of 2019, with US$77 billion invested, a 54% increase over the previous period, according to the UNCTAD report. Canada was the fifth largest investor in Latin America and the Caribbean in 2018 and is still among the largest contributors to the FDI coming to Brazil.