Brazil’s economic activity grows unexpectedly in February

April 15, 2015

Silvio Cascione – Reuters, 04/15/2015

Brazilian economic activity grew unexpectedly in February from the previous month, central bank data showed on Wednesday, but economists said the increase was too small to dispel forecasts for a recession this year in Latin America’s largest economy.

The Brazilian central bank’s IBC-Br economic activity index BRIBC=ECI, a gauge of farming, industry and services activity, rose a seasonally adjusted 0.36 percent from January, topping market expectations for a drop of 0.2 percent.

The index is seen as a leading indicator for gross domestic product data, which is released quarterly. Economists have forecast Brazil’s economy to shrink about 1 percent in 2015, which would be the country’s deepest recession in 25 years.

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Another huge and open iron mine is carved out of Brazil’s rain forest

April 14, 2015

Dom Phillips – The Washington Post, 04/13/2015

The line of trucks and four-wheel-drive pickups threw up clouds of red dust as it snaked up the hill on the wide dirt road. From the top, Brazilian rain forest stretched out into the distance. Before it, a vast quadrangle was being carved out of the slope by an army of machines, a scar of red earth in the green hills.

S11D, as this project is unceremoniously known, is an open-cast iron ore mine being dug out of this corner of the Brazilian Amazon, in the state of Para. Brazil’s mining giant, Vale, says the mine was designed for minimum environmental impact and maximum profitability. It is to start operating next year and by 2018 will be producing nearly 100 million tons annually of some of the purest iron ore in the world — a lifeblood for Brazil’s pallid economy.

But environmentalists argue that S11D could destroy rare savannah ecosystems found in two lakes on top of rich iron ore deposits. Dozens of caves that potentially contained evidence of ancient Amazon habitations have been lost. This grandiose $17 billion project is emblematic of a very contemporary, Brazilian dilemma: Can the country develop its rich natural resources without causing irreparable damage to its environment and history?

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Brazil’s Rousseff navigates troubles at home as she ponders a U.S. visit

April 6, 2015

Vinod Sreeharsha – McClatchyDC, 04/01/2015

Brazilian President Dilma Rousseff is expected to meet President Barack Obama next week when the Western Hemisphere’s leaders gather for the Summit of the Americas in Panama, in what will be Rousseff’s highest-profile encounter with Obama since revelations last year that the National Security Agency had spied on her.

Made public in the documents leaked by fugitive former NSA contractor Edward Snowden, the spying revelation led to the cancellation of a planned Rousseff visit to Washington, and she’s expected to respond next week to an invitation from the White House to reschedule the trip.

Yet tense relations with the Obama administration are nothing compared with what Rousseff faces at home: two years of virtually no economic growth, a currency that’s plunged 18 percent against the dollar just since Jan. 2, a major corruption scandal and loud calls for her resignation or impeachment. In just the third month of her second four-year term, her approval rating is 13 percent, according to the Brazilian pollster Datafolha, after she won 52 percent of the vote last fall.

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Fateful Harvest: Why Brazil has a big appetite for risky pesticides

April 6, 2015

Paulo Prada – Reuters, 04/02/2015

The farmers of Brazil have become the world’s top exporters of sugar, orange juice, coffee, beef, poultry and soybeans. They’ve also earned a more dubious distinction: In 2012, Brazil passed the United States as the largest buyer of pesticides.

This rapid growth has made Brazil an enticing market for pesticides banned or phased out in richer nations because of health or environmental risks.

At least four major pesticide makers – U.S.-based FMC Corp., Denmark’s Cheminova A/S, Helm AG of Germany and Swiss agribusiness giant Syngenta AG – sell products here that are no longer allowed in their domestic markets, a Reuters review of registered pesticides found.

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Brazil’s real weakens further against dollar on political, economic turmoil

March 4, 2015

Jeffrey T. Lewis – The Wall Street Journal, 03/04/2015

The Brazilian real plummeted against the dollar Wednesday as a burgeoning scandal at state-controlled oil company Petrobras and a steady stream of bad economic indicators pushed investors to seek safety in the U.S. currency.

The real was trading at 2.9755 at 11:21 a.m. São Paulo time, according to Tullett Prebon via FactSet, the weakest level since 2004. The real closed at 2.9111 on Tuesday.

On Tuesday night, Brazil’s attorney general asked the country’s Supreme Court for permission to proceed with investigations against a number of politicians, and local news media have reported that several prominent politicians have been implicated.

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Brazil attorney general seeks investigation into political figures in big kickback scandal

March 4, 2015

US News/AP – Brad Brooks, 03/02/2015

Brazil’s attorney general on Tuesday asked the Supreme Court for permission to investigate 54 people, the majority top political figures, for alleged involvement in what prosecutors say is the country’s largest corruption scandal yet uncovered.

Attorney General Rodrigo Janot’s request opens an expansive new phase of the investigation into the kickback scheme at state-run oil company Petrobras.

“We’re going to work with tranquility, with balance. Those who must pay will pay,” Janot told supporters outside his office late Monday night. “We’re going to investigate. This will be a long process, we’re just now beginning. The investigation begins and we’ll follow it through to the end.”

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DEALTALK – Banks pin hopes for Brazil IPO revival on Levy’s success

February 4, 2015

Guillermo Parra-Bernal – Reuters, 02/04/2015

Any revival in initial public offerings in Brazil seems to hinge on whether new Finance Minister Joaquim Levy can clean up public finances and get the country’s economy back on track.

Strengthening the market for new listings depends increasingly on how much leeway President Dilma Rousseff will give the University of Chicago-trained economist to cut Brazil’s record budget gap and reverse the interventionist policies that marred her first term.

Stung by dozens of deals that failed to deliver the promised returns in recent years, money managers have become cautious about Brazilian offerings. In 2014, only one company went public on the São Paulo Stock Exchange, the worst performance for domestic IPOs in 11 years.

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