Q&A: What Brazil Can Offer the World

Business opportunities and the current economic climate in Brazil are outlined for MEI readers in a Q&A with Madeleine Blankenstein, business development and marketing partner, Grant Thornton Brazil.

Please outline your role and responsibilities

“I am a partner responsible for business development and marketing at Grant Thornton Brazil as well as a client services partner. I am also Grant Thornton Brazil's International Business Centre (IBC) director. The IBC role is an important one as it puts me in close contact with all our Grant Thornton International member firms around the globe. One of my responsibilities is to advise newcomers to the Brazilian market. It is important for all businesses to be aware of the opportunities and pitfalls that are presented by Brazil. My aim is to ensure business leaders have acquired a good general knowledge in respect of doing business in Brazil before they enter a venture in this country.”

What services does Grant Thornton offer in Brazil?

“Our range of services is broad. We provide audit, tax structuring (international taxes and transfer pricing), tax consulting, expatriate tax, due diligence (assurance and tax) projects, valuation business risk projects, advisory services to initial public offerings, corporate finance, forensic accounting, tax compliance and outsourcing services (tax and accounting, payroll processing, financial services), and assisting companies with setting up businesses in Brazil.

We have a team of 520 professionals who are dedicated to provide distinctive and personalised services to clients according to their specific needs. We submit tailor-made solutions, taking into account the type of client, activities and local requirements. Our basic concerns are the constant changes to Brazilian rules, in particular the ones related to tax.” 

What does Brazil have to offer UK-based or other overseas investors?

“Brazil is a large country, approximately the same size as the USA (excluding Alaska). There are almost 200m inhabitants, half of who are lower middle class and who are eager to buy consumer products in general. Our financial sector is strong, Portuguese is spoken throughout the country and our economy is relatively stable. There is an eagerness to invest in infrastructure with an eye on the 'Mega' Events on one side (such as the FIFA Confederation Cup, FIFA World Cup and Olympic Games), but also looking ahead at infrastructure projects ensuring a long term legacy.”

What sectors are doing well at the moment in the country?

“Service companies (that cater to events) are thriving. The same goes for companies that supply or deal with infrastructure projects. Information Technology services/services to technology is a sought after and growing sector. Sectors that deal with the consumption of the middle class, such as education, health, food, beverage and entertainment in general are growing too as the population demands more from a consumer lifestyle.”

What is the current business climate in Brazil?

“Having said all the above, the current business climate is not buoyant. GDP growth is expected to be 1.5% for 2012 (although ahead of many developed markets), however interest rates are down, inflation is under control, and the climate in general is one of stability.”

Has the current global recession hit Brazil hard?

“The current global recession has affected our economy both negatively and positively. Negatively when we think of investments that are on hold, and reduced demand for our commodities. Positively when we think of international companies seeking new opportunities and come to invest in Brazil successfully.”

How should a UK-based or overseas company best approach targeting opportunities in Brazil?

“Understanding the feasibility of investing in Brazil is an interesting proposition. One must be aware of the current high cost of living, 'red tape' but most importantly the influence of taxes. Depending on the type of service or goods a company has to offer, taxes can become deal breakers. It is of utmost importance to choose the appropriate advisors in order to mitigate the risks presented by these perceived barriers and help navigate their way to successful and profitable operations. These barriers are not insurmountable but understanding the cultural and trading environment before entering the market is key to success.”

Are there are any nuances in Brazilian business practice that our readers would do well to be aware of?

“Stay away from informality, choose the appropriate partners to deal with, be aware of bureaucracy, and understand the different way Brazilians deal with time. In Sao Paulo and Rio de Janeiro it is often the case that guests arrive a little late to an invitation, regardless of whether it is a professional or personal event.”

Finally, what do you think hosting major sporting events will do for the country?

“Hosting such events will improve the infrastructure of the 12 cities that are rebuilding stadia, improving airports, transport, and tourism in general in order to welcome international and local tourists for the major events that the country is holding over the next few years. I believe the events will leave a long term legacy for the improvement in the way Brazilian people live, with infrastructure projects related to energy, fuel, construction, communications, education and health. Hosting the events will also attract tourists who are generally weary of flying long distances to come to Brazil. Brazil is a country full of colour and music, where people are friendly and happy to learn about other cultures and traditions. Brazil is an emerging market that has a lot to offer international business and the global economy. Major international sporting events raise the profile of Brazil and remind the world of what Brazil can offer.”

For further details on how Grant Thornton can help you in Brazil, please contact:

Madeleine Blankenstein
Grant Thornton Brazil

Bernardino de Campos,98 - 14º floor.
Paraíso – São Paulo – SP

T: +55 11 3886 2323
F: +55 11 3889 0569
E: This email address is being protected from spambots. You need JavaScript enabled to view it.  

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