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Doing Business in Brazil. Rio de Janeiro. Felipe Hsieh Trade & Receivables Finance, UK October 2012. Quick facts about Brazil. Brazil is Latin America’s largest economy ; among the 10 largest in the world (GDP in 2011: $2.5trn)

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doing business in brazil

Doing Business in Brazil

Rio de Janeiro

Felipe Hsieh

Trade & Receivables Finance, UK

October 2012

quick facts about brazil
Quick facts about Brazil
  • Brazil is Latin America’s largest economy ; among the 10 largest in the world (GDP in 2011: $2.5trn)
  • Brazil is the world’s fifth-largest country by geographical area, 8.5 million km2 and fifth most-populous country, with 190 million inhabitants
  • Brazil’s ‘investment grade’ economy is diverse and has large and developed agricultural, manufacturing, mining and services sectors


  • Population: 190,732,694 (IBGE 2010)
  • Total area: 8,511,965 sq km
  • Capital: Brasilia
  • Major language(s): Portuguese
  • Time zone: GMT -3 (Brasilia)
  • Currency: Real (BRL)
  • Central bank: The Banco Central do Brasil (BCB)
  • Gross domestic product: 2.5trn (2011)
  • Inflation rate (consumer prices): 6.5% (2011)

North Region

Northeast Region

Central-west Region

Southeast Region

South Region

Source: Ministerio da Fazenda

the great transition
The great transition
  • Brazil’s growth story from 1995-2011: from short boom-and-bust cycles in the 1990s to more-sustained growth more recently
  • The performance of the economy in the last 15 years can be divided into two main periods: Fernando Henrique Cardoso administration (1995 – 2002) and second, the Lula administration (2003 – 2010).

Brazil GDP growth

(%, annual)

Source: IBGE, HSBC

growth consumption and social mobility
Growth, consumption and social mobility

A structural shift in Brazil’s demographics

  • Strong job market
  • Government income distribution programs
  • Relatively stable inflation

Brazil: Distribution of Economic Classes

(millions of people)

  • Demographics and increasing household income are positive drivers for the next two decades
  • Middle Class is growing as poverty is reducing
  • Per capita GDP is expected to more than double by 2030
  • Social Mobility impacting around 40m individuals over the next 4 years


Source: Ministry of Finance

retail sales and industrial production contrasting picture
Retail sales and industrial production - contrasting picture
  • Consumption has been a compelling story in Brazil in the last few years
  • The intensive migration of lower income Brazilians to the middle-income segments brought to the market 40 million potential consumers that have access to credit
  • While retail sales have expanded more or less continuously since 2008, industrial production has been stagnant since 2Q2010
  • Demand-led growth; competitiveness still a challenge

Household ownership of durable goods

Gap between demand and supply (Jul 2008 = 100)

% of Household

Source: IBGE

Source: PNAD

key challenges
Key Challenges
  • Infrastructure deficiencies
  • Complex Taxation System
  • Slow legal framework
  • Corruption
Trade – Facts & Figures

Brazilian Foreign Trade

Exports are almost three times larger compared to ten years ago



US$ Billions


Source: MDIC

Trade – Facts & Figures

EXPORTS (2009)

China represents now 13% of Brazilian exports against 2% in 2000

IMPORTS (2009)

China represents now 13% of Brazil’s imports against 2.2%

in 2000

Source: MDIC

Trade – Facts & Figures

Exports*: Brazil’s Rank and Market-Share


Orange Juice












Soy Bean











* Data from 2009

UK – Brazil Trade

Trade between Brazil and UK grew by 4 TIMES over the last 10 years

Goods and services sold by UK institutions to Brazil grew by same rate

Source: MDIC

Trading with Brazil

Since 1990 Brazil has made substantial progress in reducing border trade barriers (tariffs, import licensing, etc.)

Moderate tariffs, especially on import taxes

Import license required for certain products

Free Ports, Zones

Common Import Taxes:

- Import Duty

- Industrialised Product Tax (‘IPI’)

- Merchandise and Service Circulation Tax (‘ICMS’)

Business etiquette and culture…

Most of companies have English-speakers, however using interpreters for 1st meeting can be a good idea….

Establishing personal relationships is essential to conducting business

Like South-Europeans Brazilian use a lot of body language and contact

DO NOT attempt to do business during CARNIVAL!

HSBC in Brazil


Branches: 60

ATMs: 257

Mini-branches: 108

Key Figures

Established: 1997

Branches: 897

Employees: 25,000

Customers: 5 million

ATMs: 5,285



Branches: 47

ATMs: 351

Mini-branches: 124


Retail Banking

Middle West


Branches: 103

ATMs: 501

Mini-branches: 142


Trade Finance


Branches: 445

ATMs: 2,654

Mini-branches: 675


Payments & Cash-Mgmt


Branches: 242

ATMs: 1,522

Mini-branches: 523

Global Markets

Corporate Banking

Key Contacts

l British Embassy, Brasília (Distrito Federal) [email protected]

l British Consulate-General, São Paulo [email protected]

l UK Trade & Investment - Enquiry Service [email protected]

l Export Finance Programme (Programa de Financiamento às Exportações—Proex)

l Brazilian Association of Listed Companies (Associação Brasileira das Companhias Abertas— Abrasca (Portuguese only).

l Brazilian Export Credit Insurer (Seguradora Brasileira de Crédito à Exportação—SBCE) us/index.asp

l Brazilian Foreign Trade Association (Associação de Comércio Exterior do Brasil—AEB), (Portuguese only).

l Ministry of Development, Industry and Commerce (Ministério do Desenvolvimento Indústria e Comércio Exterior—MDIC) (Portuguese only).

l São Paulo State Federation of Industry (Federação das Indústrias do Estado de São Paulo—FIESP),


This document is issued by HSBC Bank plc (“HSBC”). HSBC is authorised and regulated by the Financial Services Authority (“FSA”) and is a member of the HSBC Group of companies (“HSBC Group”). Any member of the HSBC Group, together with their directors, officers and employees, may have traded for their own account as principal, underwritten an issue within the last 36 months, or have a long or short position in any related instrument mentioned in this material

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