Lack of raw materials, price rises, dollar with a rise of more than 35% since the beginning of the year, political instability, municipal elections. In addition, external factors such as the Chinese conflict, elections in the US and the Covid19 pandemic (perhaps the largest in history with a global impact). In one paragraph, you have enough factors to deter any investor from coming to Brazil right now. But I want to challenge you to prove the opposite, to show that this is the exact moment to come to Brazil, start your company or make alliances and earn money.
I put some points here, starting with the exchange rate. This mega devaluation of the exchange rate, even questioned by the Trump administration as an anti-trade practice, is one of the most attractive factors for foreign investment. A company that previously needed just under US $ 25 thousand to put R $ 100 thousand in Brazil, can now do so with much less. Although the world has suffered a loss in the appreciation of the currency, depending on the investor’s country, this devaluation can reach about 30%, since there are countries that have lost only 5% of the currency’s potential. In other words, 5% of the 35% that Brazil lost is 30%. Applying the index to the same R $ 100 thousand, the company would now need to have US $ 18 thousand to have the same value in Brazilian currency. It seems small, but add three zeros in this account and see that the savings in foreign currency can reach $ 7 million. Or in Brazilian reais, at 40 million.
Another factor that we can take into account is political instability. Looking at the side on which we have experienced a political challenge for almost a decade, with instability and alternation of economic models, it may seem contradictory that this is an incentive for investments to come here. However, on the same bad side of history, throughout this period we had the sad footprint of millions of companies closed. Companies that were service providers or suppliers of various industries that remained standing. This created a gap, which at this very moment is beginning to be felt: lack of a supplier market. Everything is missing here. From cardboard to steel. This shows that with a small sign of economic recovery, we will be prevented from growing due to lack of structure and supply. Knowing how to take advantage of this gap, investors could now benefit like never before. To this is added a statement that in Brazil is never uncertain: whoever has money wins and earns money. Because with each crisis inequality increases and rentism strengthens. Every year Forbes increases the list of Brazilian billionaires, not counting those who do not declare their income.
And in order not to stretch further, and to conclude, I add one more factor: the country’s consumption potential and the supply of raw materials to the world. Criticized many times for exporting commodities, Brazil does not feel the global crises with greater intensity, thanks to its plurality in the agro-industrial and mining sectors. Something that the world consumes from us and that generates a whole production chain behind it. This chain has developed a lot in recent years, becoming a world reference and attracting the world’s attention. A great place to invest here.
And how about, after this reading, rethinking Brazil?
Written by Mário Pólis, CEO EMME, Bachelor of International Business (UNIMEP) and Master in Production and Manufacturing Engineering (UNICAMP)
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