Jokes apart, Brazil and Portugal have a lot in common. Same language, and a cultural heritage are key elements in construction a business relationship. Portugal could play a strategic part in the expansion of Brazilian companies, specially in Europe.
Portuguese Prime Minister visits Brazil
In a recent interview in Sao Paulo, the Portuguese Prime Minister Jose Socrates said that he wants to promote a rapprochement between Portuguese companies with Brazilian peers in the global process of economic internationalization.
In the first leg of his four-day visit to Brazil and Venezuela, Socrates attended a meeting with about two dozen Brazilian and Portuguese business men at the Federation of Industries of São Paulo (FIESP), the largest business entity in Brazil.
Jose Socrates met with representatives of Votorantim and Camargo Correa, which recently acquired stakes in Cimpor, Embraer, OGMA shareholder, Alpargatas (shoes) of CSN’s controlling Lusosider and Cisa Trading.
The Portuguese representatives also visited Petrobras, Vivo, owned by PT and Telefónica, the Odebrecht Group, and Portuguese companies, such as EDP, TAP, CGD, Cimpor and LBW.
Brazilian investment in Portugal
Bilateral direct investment in Brazil has quintupled in Portugal in 2009, according to the latest figures from the Central Bank of Brazil. If in 2008 the total investment by Brazilian companies on land luso reached 65 million dollars already in the twelve months of last year the value jumped to 310 million dollars. With this jump, Portugal now worth 4% of the total investment in Brazil, against 0.4% in 2008.
Embraer, a leading manufacturer in the aerospace industry, already has the green light from the European Commission to apply 400 million in two factories in Évora , for the construction of private jets.
At the end of last year, moreover, the growing appetite for Brazilian Portugal was reflected in the war between Camargo Corrêa and also Brazil’s Companhia Siderurgica Nacional for control of Cimpor. But there’s more concerned, as told Basilio Horta in January. “There are other companies from Brazil with whom the agency [AICEP] has established contact in the same direction, and others that we have addressed in an exploratory way and we hope they will achieve investment in Portugal”, advancing the president AICEP.
Lula in Lisbon
Brazilian President, Lula was in Lisbon, on May 19th at the last summit Luso-Brazilian.
Portuguese investment in Brazil, down trend
However, despite the appetite of Brasilia to Lisbon, in the opposite direction things are not going to feature. In any crisis, whether by fear, the Portuguese investment in Brazil has shown a downward trend. During 2009, the value applied by the Portuguese in Brazil fell by 6% to EUR 309 million, accounting for 1.2% of foreign investment in the country. Value that compares, in 2008, with a share of national investment of 2.4% of total capital invested in Brazil. Despite the drop, the interests of the Portuguese side of the Atlantic remain firm.
Portugal Telecom owns a third of the largest Brazilian mobile operator, Vivo, with 54 million customers. Brisa already owns 16.3% of the RCC – the largest highway concessionaire in Brazil – and Brazil’s Energy, owned by EDP, serves over seven million customers nationwide.