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International Corporates and Institutions – Tom Ringseth

DnB NOR - Financing and Risk Competence in Emerging Markets. International Corporates and Institutions – Tom Ringseth. Brazil seminar on Energy and Shipping. Agenda: Norwegian Business in Brazil Political and economic update Energy and shipping in Brazil. Norwegian Business in Brazil.

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International Corporates and Institutions – Tom Ringseth

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  1. DnB NOR - Financing and Risk Competence in Emerging Markets International Corporates and Institutions – Tom Ringseth

  2. Brazil seminar on Energy and Shipping Agenda: • Norwegian Business in Brazil • Political and economic update • Energy and shipping in Brazil DnB NOR Bank – International Corporates and Institutions

  3. Norwegian Business in Brazil Trade Stortingsmelding 15 Norwegian investments in Brazil Companies and sectors Today over 100 Norwegian companies established or represented in Brazil DnB NOR Bank – International Corporates and Institutions

  4. Political and economic update • Short overview of economic situation • Politics • President Lula government • Difference between first and second administration • Current financial crisis • Elections 2010 • Political challenges DnB NOR Bank – International Corporates and Institutions

  5. Economic update • 70-mid 90’s several domestic and international crisis • President Cardoso (FHC) 1994-2002 • Orthodox economic policies • President Lula 2003-2010 • Continued orthodox policies • Second mandate more social focus • Prior to crisis, historical best moment • Crisis, 4th quarter 2008 GDP – 3.6% • Crisis, Lula administration measures • S&P’s view DnB NOR Bank – International Corporates and Institutions

  6. Economic update • Economic challenges in Brazil • Inflation or growth ? • World’s highest interest rates • Current account deficit • Lower trade surplus • Increasing fiscal deficit DnB NOR Bank – International Corporates and Institutions

  7. Challenges • Political challenges: • Social security, fiscal and political reforms • Social developments • Education, health and security • Infra structure DnB NOR Bank – International Corporates and Institutions

  8. Energy and shipping • Energy matrix • Oil & gas • Petrobras and OGX, SH, Shell Chevron, Repsol, BG, etc. • Current production peaks 2.2 million of bpd • Pre salt potential • Investments of USD 800 billion (UBS Pactual) • Future production • 3.7 million of bpd by 2013 • 5.7 million of bpd by 2020 • Petrobras Investment Plan 2009 – 2013 • Basis USD 40 p/barrel • Financing secured for 2009 and 2010 DnB NOR Bank – International Corporates and Institutions

  9. Energy and shipping • Oil or fluids exporter • LNG importer -> exporter Petrobras now entering market for equipment and services Travels to Singapore last week and this week to Korea. Invitations for ship building companies to establish themselves in Brazil. DnB NOR Bank – International Corporates and Institutions

  10. Shipping • Brazilian flag • FMM – BNDES and Banco do Brasil • Offshore segment case – a success story ! • Clients • Technology • Financing DnB NOR Bank – International Corporates and Institutions

  11. Shipping • Offshore vessels - 146 vessels Petrobras new build program + 50 vessels for other operators • Rig • Drill ships • Tankers • Transpetro • Local shipping companies • FPSO’s • Shuttle tankers • Need for shipyards DnB NOR Bank – International Corporates and Institutions

  12. EXPORT CREDITS Challenges oil & gas sectors • Higher local content • Local production as part of industrial policy • New legislation, 1% of gross revenues into domestic R&D • Development of local technology clusters • Petrobras – Cenpes • Development of Brazilian oil equipment and service industries • Brazilian and Norwegian partnerships, jv., patents • Establishment in Brazil of Norwegian companies: • Sales office • Local production • Manpower - competence DnB NOR Bank – International Corporates and Institutions

  13. Challenges in Shipping sector • Lack of reliable shipyards • Weak local network of domestic equipment suppliers • Manpower challenges • Shipyard • On vessels • CSR initiatives • Naval Academy • CSR Maritime group – DLW Dream Learn Work DnB NOR Bank – International Corporates and Institutions

  14. Finance • BNDES • Reais • FMM – USD • ECA’s • GIEK, Eksportfinans and DnB NOR • IFC • Project finance – more challenging DnB NOR Bank – International Corporates and Institutions

  15. Conclusions • Oil & gas and shipping in Brazil has decades ahead with good business potential. • Come to Brazil, consider doing direct business within Brazil. • The most successful companies have established themselves during many years. • Build up your network, with contacts within finance, banks, BNDES. Try to fund yourselves in Brazil in Reais or USD depending on your business segment. • Develop your network with lawyers, consultants, listen to your contacts in Norway and at the Brazilian Embassy. There are strong Brazilian–Norwegian networks through BNCC, NBCC, INTSOK, Innovation Norway. DnB NOR Bank – International Corporates and Institutions

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