It seems that Brazil is certainly welcoming 2008 with a bang. Despite recent bad press due to Investor skepticism over the viability of Brazil’s property market, the country has fought back and emerged scathed but bearing good news, proving that they are still a hot commodity.
A Discovery to Carry a Nation
Last January 21st one of Brazil’s energy giant, Petrobas announced that they have discovered a large gas reserve in the Tupi oil field. As a result, Brazil’s already sizable oil reserve is becoming bigger. Petrobas will also rise higher in rankings as one of the world’s largest oil company. More financial capability is now at the country’s finger tips; priority programs such as socially and economically targeted agendas are easier to implement; the resources of this breakthrough is providing Brazil with the means to augment the country’s long term growth.Notwithstanding the fact that the World Bank downgraded Brazil’s business viability, towards the end of 2007, the Brazilian Stock and the Brazilian real estate attained record highs and Bovespa grew up to 72%, beaten only by China’s Stock Market.
Brazil’s GDP has also grown consistently since 2007 effectively advancing the country’s economic standing.
In recent years, United Kingdom’s Homebuyer’s Show North and Property Investor stated that the Brazilian Property’s capital growth is 20 % in the last, beating even some of the European countries record.
An Economic Crisis
Although the impending dip in the US economy is worrying potential investors, Brazil is in a position to weather out the slump and credit crisis because of its current stability. President Luiz Inacio Lula da Silva is committed on sustaining Brazil through the financial crisis that is currently gripping the world.
The president’s assurance and unwavering tenacity shows political stability which allows the Investors to see that Brazil’s property market is secure. Even HSBC’s Private Bank Head Chris Allen, considers Brazil a good market to invest on. He has been saying that Brazil is to be considered a haven for potential investors due to development in the owner-occupier property segment, low interest and falling inflation rates, and a generally stable political environment.
Another assurance that Brazil is stable, was given by Regis Abreu who said that “Economic growth in Brazil this year won’t be affected so much, despite the credit crisis and slump in global financial markets, thus Brazilian companies will still enjoy robust earnings growth,”. Regis Abreu manages 2billion worth of assets in Rio de Janeiro for Mercatto Gestao de Recursos. He has calculated that the companies which are included in the Bovespa Index will experience a growth of 15 to 20 % this year.
The immense growth of Foreign Direct Investment underlies Brazil’s popularity with the global investment community. Brazil is the third largest beneficiary of foreign investment, even bigger than that of India and Japan.
The oil discoveries, the stock market growth, political stability and even the FDI’s are indications that the Brazilian property market has a promise of profit. Countries such as Dubai and Norway both experienced a rise in their economies due to the factors mentioned above and Brazil’s is quickly following suit.
Tourism’s Economic Impact
Aside from economic and investment prowess, Brazil has its tourism industry to offer. It is currently drawing International Investors both big and small, even individual financiers are taking a piece of the pie. The remarkable beaches, the exotic lifestyle, and great year round weather are attracting tourists around the world.
The influx of tourist in Brazil paved the way for urbanization and business development. European and British travelers are fast in recognizing the advantages of taking a vacation in Brazil. For one, the buying power of the Euro and the British pound is quite substantial; another enticing factor is that the cost of living in Brazil is just 1/5 compared to that of Britain and Europe.
Even if you add up the airfare costs it is still cheaper to take a vacation in Brazil rather than going to another European country. What’s more Brazil offers a wide variety of affordable accommodations; the food, the drinks, and the carnival atmosphere is really attractive and reasonably priced as well.
Like all emerging markets Brazil needs support, encouragements, and investors for it to reach its full potential. President Luiz Inacio Lula da Silva is firm in his resolve to see Brazil through reliable, consistent, sustainable and realistic growth.
Have a look around Fleicheras and Guijaru, excellent investment possibilities, North of Fortaleza….
A truly Bric investment, also very popular with the rich and famous from Brazil, they just had a reality show at Globo TV there… great place.
Comment by rob — November 22, 2009 @ 10:22 am
Good investment discovery! The oil reserve has potentials to provide other countries if not, their own Brazil, a much cheaper and better oil. There is much more Brazil can offer and so with the tourism industry.
Comment by Cathy — January 7, 2010 @ 5:09 pm