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FDI into Brazil has increased by 66.48% in a little under two years. Jonathan Wildsmith reports.

FDI into Brazil boomed between 2008 and 2011, but the country experienced a year-on-year decline across project numbers, capital investment and job creation between 2012 and 2017. According to data recorded from January 2017 to November 2018 by global greenfield investment monitor fDi Markets, FDI into Brazil has increased by 66.48%, with almost 300 projects announced in 2018. The Latin American giant has also witnessed its market share of projects in the region climb by 7.51% in the year so far.

Between January 2012 and November 2018, a major source of FDI has come from European companies, which on average accounted for 48.71% of all jobs generated in Brazil by greenfield investments. As for the other continental giants, North America amounted to 24.15% and Asia-Pacific represented 22.01%.

During this period, the US, Germany and Spain were the main investing countries. These three source nations accounted for 77 projects in 2016 and 95 in 2017. Between January and November 2018, this figure has risen to 157, which represents growth of 65.26%.

Data up to November 2018 has provided several insights regarding the country’s reversal of fortunes. It highlights that FDI project numbers into the software and IT services sector, as well as the communications industry, increased by 18.52% and 43.75%, respectively. Moreover, capital investment into the renewable energy sector has risen by 80.02% and the coal, oil and gas sector has witnessed an increase of 125.55%. Nevertheless, this progression is offset by a decline in the automotive components industry and consumer products sector.

Brazil is once again becoming an increasingly attractive destination for international investors. Brazil’s São Paulo was named fDi’s Latin American State of the Future for 2018/19 and the state’s investment promotion agency, Investe São Paulo was named fDi’s Investment Promotion Agency of the Year for 2018. While the election of far-right former army captain Jair Bolsonaro as Brazilian president casts a cloud of uncertainty over the direction of economic policy in the country, one thing remains certain: that is that all eyes will remain fixated on the course of action that is taken in the coming months and years. 

This article is sourced from fDi Magazine
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