Transcript Brazil - Norway - Brazilian-Norwegian Chamber of Commerce

Brazil – Norway
Bilateral relations in a new dimension
Ambassador Sérgio Eduardo Moreira Lima
BNCC, Oslo, February 26, 2008
1
The Brazilian Economy in 2007

GDP growth of 5.2% (above the Government´s target of 4.5%)

Inflation rate of 4.3% p.a. (under the Government´s target of 4.5%)

Basic interest rate of 11.25% p.a.

International reserves of US$ 177 billion

Exchange rate of R$ 1.80 per dollar at end of year

Trade surplus of US$ 41.5 billion

FDI flows of US$ 34.6 billion
2
Industrial and Agricultural Growth

Industry
– Sales in computers expanded 24%, cars 25%, cellphones 32%, trucks 34%
and agricultural machinery 42%
– Mining, steel manufaturing, oil exploration and durable goods pushed
economic growth in 2007
– Expected to perform well in 2008 in view of investments in the PAC

Farming
– Rural GDP resumes growth (6.8% in 2007)
3
Brazilian Economic Outlook for 2008

GDP growth above 5.0%

Inflation rate under 4.5% p.a.

Basic interest rate of 10.75% p.a. (market expectation)

Exchange rate in the range of R$ 1.75 – 1.85 per dollar

FDI flows of US$ 28 billion

Trade surplus of US$ 30 billion

Continued industrial production growth of 5%
4
Some Key Areas

Oil & Gas
– Tupi field has estimated reserves of 12 to 30 bn barrels
– Should duplicate known reserves and rank Brazil among 10 largest world
reserves

PAC
– From 2008 to 2011, R$ 136 bn for investment in new railways, roads,
water treatment units and hydroelectric plants
– 2/3 should come from private investment, with long term financing by
BNDES

Investment grade status
5
Brazil Trade Surpluses
(US$ billions)
160
Exports
Imports
118
120
96
48 49
55 56
58 56
2001
73
2000
140
120
100
80
60
40
137
47
91
63
60
160
74
48
2007
2006
2005
2004
2003
2002
1999
20
0
INTERNATIONAL RESERVES
FEB.08
190
(US$ billions)
190
170
Increase: over 130 billions
160
150
140
130
120
110
Liquidation of Foreign
Debt to IMF
100
90
80
70
mar/06
59,8
60
50
40
30
sep
03
des
03
mar
04
jun
04
*/ Position at 06/Sep/2007.
Source: Central Bank of Brazil
sep
04
des
04
mar
05
jun
05
sep
05
des
05
mar
06
jun
06
sep
06
des
06
mar
07
jun FEB
07
08
7
2007
a historical year in bilateral relations

State Visit of President Lula

Visits of the Minister of External Relations, the Minister of
Development, Industry and Trade, the Minister of Environment, and 14
governmental delegations

High-level business contacts (´A Meeting of Energy Giants´, CSR
Conference, Petrobras, CVRD, Brazil Seminar in Bergen, Breakfast of
President Lula with Norwegian CEOs)

Agreements between companies (Petrobras-Statoil) and business
federations (CNI-NHO)
8
2008
follow-up of President Lula’s visit

Visit of Minister Tora Aasland (March)

Visit of Prime Minister Jens Stoltenberg to Brazil with ministerial and
business delegation (September)

Visit of Minister Åslaug Haga to Rio Oil & Gas (September)

Visit of Minister Gilberto Gil (November)

Opening of Honorary Consulates in Bergen and Stavanger
9
Bilateral trade flows reach a new record
surpassing one billion dollars.
Trade Flow Brazil-Norway
1200,0
1178,7
USD Million
1000,0
932,4
800,0
739,5
600,0
400,0
661,3
546,0
200,0
0,0
2003
2004
2005
2006
2007
10
Exports to all Nordic Countries increased.
Norway kept the position as the main market.
700
600
651
634
584
496
500
525
458
400
279
300
219
2006
2007
200
100
0
Norway
Sweden
Finland
Denmark
11
Norway as main destination for Brazil`s
exports in Scandinavia
Exports to
(US$ ,000)
NORWAY
Sweden
Jan 2007
59 441
35 541
Jan 2008
129 628
33 570
Δ%
+ 118 %
-5%
12
Norwegian Investment in Brazil
Scandinavian FDI to Brazil
339
400
274
US$ mn
300
Norw ay
Sw eden
200
83
100
Finland
60
54
2002
2003
26
43
2004
2005
Denmark
0
2001
2006
2007
13
”During my visit to Brazil in 2003, Norwegian
businessmen declared that Norwegian investments in
Brazil would reach 5 billion US$ in the next 5 years.
Today I can confirm that we are reaching this investment
level”
King Harald V
(Sept 13, 2007)
”I come to Norway convinced that the present moment
opens up new and important opportunities. One of them
results from a lasting cycle of sustainable growth in
Brazil”
President Luiz Inácio Lula da Silva
(Sept 13, 2007)
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