April 29, 2013
Mac Margolis – Newsweek, 04/29/2013
The Brazilian cerrado is no place for a tenderfoot. In the dry season in Aliança, the township just below the Amazon basin where Kátia Abreu farms, a withering sun leaves the land parched and choked in dust. A few months later, from November to May, downpours lash the dirt into a moonscape of potholes and mud. Many planters have stumbled here, and their tumbledown plots are strewn like headstones along the savanna. But for those who endure, fortunes can bloom. Once this sparsely peopled flatland was carpeted by niggardly scrub, home to jaguars and braces of toucans. Now corn, cotton, and soybeans grow on plantations the size of American counties, and cowboys in Land Rovers mind herds of bleached Nelore beef cattle that stretch to the horizon. The cerrado is the Western Hemisphere’s newest agricultural frontier, and no one rides taller here than Abreu.
She is not the biggest landowner or even remotely the richest (that title belongs to Blairo Maggi, the agrimogul who is the world’s largest single producer of soybeans). But this 51-year-old rancher’s widow turned land baroness, then national lawmaker, has left her brand on this Latin American powerhouse, provoking admiration, praise, and fierce opposition in competing measures. Abreu and her two sons tend a formidable stretch of the cerrado—three farms of soybeans and sorghum and 12,000 head of cattle in Tocantins, Brazil’s newest state and part of the planet’s emerging breadbasket. “It’s hard to say where she doesn’t have land,” said one government employee in Palmas, the state capital, quickly asking not to be named.
Abreu is no pampered heiress. Since 1987, when a plane crash killed her husband and nearly broke her, she has had to fend for herself. “I knew nothing about ranching,” she said. “But I am stubborn and don’t give up.” Pride and fear of failure did the rest. She cropped her hair to look less girlish and took care never to cry in front of the farmhands, sobbing only to herself at night. Ever since, the reluctant rancher has managed to command respect, authority, and a loyal following in the baritone world of cattle, crops, and rural rainmakers.
April 24, 2013
Thalita Carrio – Financial Times, 04/24/2013
Usually countries with strong currencies scare off foreign tourists. Witness Australia’s challenges. But not Brazil, apparently.
According to Brazil’s Ministry of Tourism, the number of foreign visitors has continued to rise even as though the country’s currency has stayed firm at around R$2 per dollar, making it one of the world’s more expensive destinations. In 2012, Brazil received 5.67m foreign visitors, an increase of 4.5 per cent compared with 2011.
The majority of the tourists came from neighbouring countries in South America, or about 2.8m people. In spite of its economic problems, Argentina took the lead with 1.6m of its people visiting Brazil, an increase of 5 per cent compared with 2011. The US was second with 586,463 tourists, although this represented a decrease of 1.4 per cent compared with a year earlier. Third was Germany with 258,437 tourists.
April 24, 2013
Alonso Soto, Reese Ewing – Reuters, 04/23/2013
Brazil’s government threw its sugar-ethanol industry a lifeline on Tuesday, by cutting taxes and sweetening credit for the struggling sector it hopes will resume investments in new biofuel plants to bolster output.
Finance Minister Guido Mantega, who announced the measures, said he expected a recovery in the ethanol industry could also help curb stubborn consumer inflation by bringing down fuel prices and reducing Brazil’s dependence on gasoline imports.
The reduction of the so-called PIS/Cofins – payroll and social security taxes – and interest rates on loans is expected to help ethanol groups such as Louis Dreyfus, Bunge , Cosan and others offset production costs that have risen steadily in the last decade.
April 23, 2013
Agustino Fontevecchia – Forbes, 04/22/2013
The tide may have turned for Nike. The athletic footwear company seems poised to see continued margin expansion and the return of profitability in China over the next year. Emboldened by recent success, management appears confident in the strength of its brand and its capacity to raise prices. Nike also has a double whammy of an opportunity inBrazil, with the coming World Cup in 2014 and the Olympics in 2016. The stock currently trades around $60 a share, but it could top $80 if things go their way, according to UBS ’ equity research team.
Nike has zigzagged over the past year, its stock falling precipitously and surging dramatically on any indication that margins were set to either expand or compress. After its latest earnings report, where the company revealed margin expansion for the first time in two years, Wall Street has once again gone bullish.
In a thorough note released Monday, UBS’ Michael Binetti made the case for buying the stock, expecting solid returns over the next two years. After meeting with management, Binetti spoke of a “very optimistic top line outlook from the company over the next few years,” pointing at “a deep innovation pipeline in premium footwear.”
April 22, 2013
Jonathan Wheatley – Financial Times, 04/22/2013
Brazil’s central bank is in tightening mode again, raising its policy interest rate last week after a long cycle of loosening that began in August 2011. It is worried that inflation is on the rise and less worried, apparently, about slow growth.
But behind recent numbers on inflation is another set of numbers on retail sales, which fell in February for the first time in a decade. If that turns into a trend, the very foundations of Brazil’s recent growth story will be undermined. Chart of the week takes a look.
The blue line on the chart below shows retail sales by volume, seasonally adjusted. As you can see, they have been rising almost without interruption for the past decade, undeterred by the global crisis of 2008-09 that sent so many markets around the world into a tailspin. More so even than global demand for Brazil’s abundant export commodities, it is domestic consumer demand that has underpinned Brazilian growth for the past several years.
April 22, 2013
Anderson Antunes – Forbes, 04/21/2013
Dirce Navarro de Camargo,Brazil‘s richest woman, died at home this Saturday at the age of 100. The information of Camargo’s passing was first reported by Folha de São Paulo newspaper, and confirmed by Forbes Brasil. No more details on the cause or circumstances of Camargo’s death have been released.
Camargo appeared in Forbes’World’s Billionaires list last March as the 87th richest person in the world, the 4th richest person in Brazil and the country’s richest woman, with a net worth estimated at $11.5 billion. She was also the world’s oldest billionaire.
The bulk of Camargo’s fortune comes from her stake in Camargo Correa, a Brazilian private conglomerate founded by her late husband, Forbes’ “original billionaire” Sebastião Camargo, in 1939. The company, which is present in more than 20 countries and employs over 60,000 people worldwide, has operations in cement, energy and construction. It also controls São Paulo Alpargatas SA, which manufactures the world famous Havaianas flip-flops.
April 22, 2013
Yuri Takkteyev – Foreign Affairs, 04/21/2013
How did a programming language from the global South manage to make it into one of the world’s most popular web sites? Lua’s story, as it turns out, tells a lot about the globalization of software development and the difficulties faced by innovators in developing countries.
I first heard of Lua eight years ago, when I traveled to Rio de Janeiro to interview software engineers for a research project that was recently published as a book, Coding Places. While in Rio, I met “Rodrigo,” who worked on a free and open-source web platform. He surprised me by telling me that the project was based on a new programming language, Lua, developed by a small team at Pontifícia Universidade Católica do Rio de Janeiro (PUC-Rio), where Rodrigo had been a student.
April 22, 2013
Joe Leahy – Financial Times, 04/21/2013
In 2010, when 60 Minutes came to Brazil to do a piece on the “World’s Next Economic Superpower”, the US television programme chose Eike Batista as the ambassador for the country.
“You know, in the last 16 years, Brazil has put its act together. This is it. Hello, time for Americans to wake up,” Mr Batista said with trademark brashness.
In retrospect, the discovery by primetime TV of Brazil’s economy should itself have been a sell signal for investors that a long boom in Latin America’s biggest economy, fuelled by high commodity prices and credit, was peaking.
April 12, 2013
Brian Winter – Reuters, 04/11/2013
President Dilma Rousseff will make the first formal state visit by a Brazilian leader to the United States in nearly two decades, a diplomatic breakthrough for an emerging power that has clashed with Washington but is hungry for closer ties and recognition of its growing prestige.
The trip will occur later this year, likely in October, officials told Reuters on condition of anonymity because the White House has not yet announced the visit. A White House spokeswoman declined comment.
A state visit, which includes formalities such as a black-tie dinner and a military ceremony upon arrival, is usually reserved for Washington’s closest strategic partners.
April 8, 2013
Joshua Goodman – Bloomberg, 04/08/2013
For millions of maids, the law is a milestone being compared to Brazil’s 19th-century abolition of slavery. For the families that rely on domestics, it’s a budget squeeze that could force them to cook and clean for themselves.
Congress last week approved a constitutional amendment granting domestic servants an 8-hour work day, overtime pay and other rights enjoyed by the rest of the workforce. While hailed by lawmakers as historic, the law is spreading concern among middle and upper-class families that the cost of employing a maid or nanny will spike after almost doubling since 2006.
Daniela Batista, a working mom in Sao Paulo, says she may fire the nanny who has cared for her children for two years to avoid paying the additional 800 reais ($400) a month she says it will now cost her in overtime pay alone. Currently she pays 1,800 reais for 12 hours of service, five days a week, and she may have to hunt for someone who’ll work for less.