Brazil’s largest city may ration water this year, utility says

April 9, 2014

Paulo Whitaker – Reuters, 4/9/2014

Sao Paulo may have to ration water this year if reservoir levels are not replenished, Brazil’s largest water and sewage utility said, an increasing possibility as the southeast region heads into its dry season.

Worries of a water shortage in the metropolis of some 20 million that will host the soccer World Cup opening match on June 12 have increased amid dry weather this week, and the city’s main source of water, the Cantareira reservoir, was at just 12.7 percent of its capacity as of Wednesday.

Economists worry that water rationing or shortages could take a toll on Brazil’s fragileeconomy, which is expected to grow just 2 percent this year, and a shortage in Brazil’sbusiness hub would add to the challenges facing President Dilma Rousseff, who is expected to be re-elected in October.

Read more…

“It is time to restructure the tax system in Brazil rather than simply fix its flaws”

April 9, 2014

Instituto Millenium, 4/8/2014

Year in, year out, the urgently necessary tax reform continues to be delayed. The complexity of Brazil’s tax system erodes industrial competitiveness and affects the poorest sections of society, who need better quality public services and lower taxes. Collection increases every year. According to the “tax meter,” in 2014 alone, Brazilian society has paid more than BRL $400 billion to tax authorities. Worse yet, they do not see returns in goods and services and cannot understand where the money goes.

To discuss the complexities of the tax system, the Milennium Institute interviewed José Roberto Afonso, economist and researcher at the Brazilian Institute of Economics (Ibre/FGV). An expert on the subject, José Roberto does not believe it is possible to twerk the current system and make it efficient, “What we need is another tax system, after all, the current one is almost 50 years old, and the world and Brazil have changed.”

Read the full interview in Portuguese here.

World Cup to generate $27.7 bn in Brazil, government says

April 8, 2014

Agencia EFE, 4/8/2014

The Brazilian government forecasts that the 2014 soccer World Cup will generate around 62.1 billion reais ($27.7 billion) in revenues, three times what was injected into the country’s economy during last year’s Confederations Cup tourney.

The estimate is based on a report published Monday by the Tourism Ministry concerning the economic impact of the Confederations Cup.

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Investors snap up $1.5 billion in bonds from Brazil’s BNDES

April 8, 2014

Rogerio Jelmayer – Wall Street Journal, 4/8/2014

Investors continued their Brazilian buying spree this week, snapping up $1.5 billion in bonds sold by the government-run National Bank for Economic and Social Development, or BNDES, and more deals are expected.

The total demand reached $5.5 billion, said a banker involved in the transaction, who declined to be named for this article.

Investors bought $1 billion in five-year bonds at a yield of 4.054%, and a further $500 million in new bonds from an existing issue due 2023 at a yield of 5.32%, the person said. BB Securities, Citigroup, HSBC and Mitsubishi UFJ Securities coordinated the operation.

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China, Brazil sign corn-supply deal

April 8, 2014

Chuin-Wei Yap, Wall Street Journal, 4/8/2014

China said Tuesday it will allow sizable imports of Brazilian corn, marking another step in the Asian giant’s moves to lessen its dependence on the U.S. for the vital grain.

The U.S. supplies more than 90% of China’s corn, but its share of the world’s fastest-growing corn market has been pared down as Beijing has sought in the last two years to broaden its supply.

China’s shift to a protein-rich diet and its rising industrialization are changing global trade flows. China’s demand for corn rose 39-fold in volume between last year and 2009, though imports so far represent only about 2% of China’s total corn consumption.

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American Chamber of Commerce wants free trade agreement between Brazil and the U.S.

April 7, 2014

Portal de Noticias – Jornal do Senado, 4/4/2014

Six months after the postponement of President Dilma Rousseff’s state visit to Washington, due to disclosures of electronic espionage conducted by the NSA, a bold proposal marked the debate on bilateral relations organized yesterday by the Brazilian Foreign Relations Committee: the signing of a free trade agreement between Brazil and the U.S.

The proposal came from the president of the American Chamber of Commerce in Brazil (Amcham), Gabriel Rico. In his opinion, Brazil needs to increase economic competitiveness and seek greater integration in the global production chain. A free trade agreement would have the backing – according to Rico – of 93% percent of member companies, both Brazilian and American.

Brazil needs to take a large leap in terms of its competitiveness, which has to happen alongside negotiations for an agreement. When an economy exposes itself to a free trade agreement, it is forced to rethink itself. If a country remains stagnant, only one side benefits – said Rico, recalling that the United States is already beginning to negotiate free trade agreements with the European Union and Asian-Pacific countries.

Also invited to partake of the public hearing, held at the request of the President of the Committee Ricardo Ferraço (PMDB-ES), the Director of the Brazil Institute of the Wilson Center, Paulo Sotero, also highlighted the opportunity of debating the negotiations of a free trade agreement with the United States. He recalled that the president of the National Confederation of Industries (CNI), Robson Braga de Andrade, defended negotiations at the end of last year.

The initiative was received with caution, however, by Ambassador Carlos Antonio da Rocha Paranhos, representative of the Foreign Ministry, who recalled the lack of consensus on the matter.

“Evidently, there is no internal consensus on efforts geared towards trade agreements, and hence, they cannot be seen as a panacea” – said Paranhos.

Read full article in Portuguese here. 

Brazil falling short in rush to overhaul World Cup airports

April 7, 2014

Brad Haynes & Anthony Boadle – Reuters, 4/7/2014

With less than 10 weeks until the start of the World Cup, work on crucial new airport terminals has fallen behind in most of the dozen Brazilian host cities, heightening the risk of overcrowding and confusion during the tournament.

A temporary canvas terminal will be used instead of a planned airport expansion to receive fans in Fortaleza, which will host six matches including Brazil’s game against Mexico and a quarter-final. Officials are already preparing alternatives for other cities.

“Other airports have not said anything yet, but they will probably have to come up with contingencies,” said Carlos Ozores, a principal at aviation consultancy ICF International who has consulted for Brazilian airlines and airport operators.

Read more…

Army tries to win over residents of Rio’s favelas

April 7, 2014

Marco Antonio Martins & Bruno Fanti – Folha de S. Paulo, 4/7/2014

Part of the success or failure of the occupation by the armed forces of the Complexo da Maré, in Rio’s north end, is its ability to win over the community. It’s what the military began trying to do three hours after its occupation of the 15 favelas of Maré.

Yesterday, there was a moment of tension between the military and residents after a young man was beaten by others and the military was accused of doing nothing.

Cláudio Brum dos Reis, 22, a student and resident of Nova Holanda, went to watch a game in Baixa do Sapateiro. The favelas were ruled by different factions. According to relatives, Reis was attacked by a group of teenagers and thrown in the ditch that divides the communities.

Occupying Brazil

April 7, 2014

Al Jazeera - 4/6/2014

In the canyons of Brazil’s largest city there are tens of thousands being left in the wake of the country’s economic riptide.

Sao Paulo has outstripped its capacity for affordable housing and yet there are hundreds of abandoned buildings that stand empty.

Facing the dire prospect of being forced into the streets by rising rents and living in the ever-expanding and hazardous favelas, there is an occupation movement taking responsibility for its own future. They seize abandoned buildings for the low-wage workers who have few options except to forcibly occupy them. They then have to live with the uncertainty that they could be removed either by the state or the building’s owner.


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