Q How well do you expect Brazil to weather the global economic downturn and how well do you think FDI levels will hold up?

A We believe that we will maintain direct investment in Brazil. As a matter of fact, last year by October we received $36bn-worth of direct investments. We are managing the crisis. The problem happened, and we have a macroeconomic base in Brazil which is very different to the past.

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If you compare [the current situation] to the other crises we have had -- the Russian crisis, the Asian crisis, etc -- we didn’t do what we should have done, we didn’t do our homework correctly. But now we have a base which is completely different from the past. We have our reserves – we have more than $200bn in reserves, which is a strong point for us.

We have spread our exports throughout the world. For example, exports to the US six years ago accounted for 25% of our total; today that figure is 13%. But we did not decrease exports to the US – the exports have jumped. What happened is that we found a lot of new markets for Brazilian products – in Africa, in South America, in Latin America, in the Caribbean, in the West, in the East.

Also, we have better industry -- Brazilian companies have been achieving a very high degree of productivity over the years. So we believe that we could pass through the crisis, not without being hurt, but not hurt as badly as many other countries. I heard that the US [in November] fired 200,000 people; we hired 200,000 people -- there’s a big difference.

Q Are you diversifying your sources of inward investment as well as your trade partners?

A Yes, we are seeing investments from different countries. We are very diversified. Until eight or 10 years ago, we didn’t have investments from Spain in Brazil. Now Spain is the third largest investor in Brazil. This is a good example of what has happened in Brazil in the past few years. And this is not because we went to these countries and convinced them to come here, but because they looked and saw that they could have trust in Brazil. They have confidence now in Brazil – more than they used to.

Q What can the government do, and what will the government do, to maintain Brazil’s competitiveness in relation to other fast-growing emerging economies?

A First of all, we should maintain the confidence of investors that the business world has not changed in Brazil and we are doing quite well. Second, the government has shown during the crisis in the past few months that it could react quite quickly to what has happened.

One example is when we had a problem with car sales in Brazil. The Brazilian car industry had been experiencing growth of 25%, which is very strong but unsustainable in the long term. It had maintained this level of growth the past two years, putting big pressure on the suppliers and auto workers -- they were working on Saturdays, on Sundays, on holidays, and third shifts. Now, the automotive industry is planning to grow by 10%, which would be the biggest growth in the world.

When we had the economic shock, people didn’t have money to buy cars because there was no credit. The government released credit [to the financing units of the auto companies] because they didn’t have the right conditions to be funded by the system, and we got things rolling again. We are doing these kinds of things so that the economy will not stop moving – as is happening in a lot of countries.

CURRICULUM VITAE

MIGUEL JORGE

2007Government of Brazil

Minister of development, industry and foreign trade

2002Santander Banespa

Executive vice-president of human resources, corporate and juridical affairs

1998Volkswagen do Brasil

Vice-president of corporate and judicial affairs

1977O Estado de São Paulo (newspaper)

Director of journalism