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Transcript of 1 Japan and Brazil Economic Outlook Brazilian Development Prospects XVII Joint Meeting of the...
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Japan and Brazil Economic OutlookBrazilian Development Prospects
XVII Joint Meeting of the Japan-Brazil CommitteeSeptember 9-10, 2014
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The world: times of catching up and increasing relevance of developing nations
Annual Growth Rates, %
Avg Growth 2008-2008 2009-2014 2009-2018Advanced Economies 2,4 1,0 1,6Emerging Markets 6,5 5,2 5,3Source: IMF, WEO
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Brazil, macroeconomic fundamentals
Consolidated Public Sector Net Debt (as % of GDP) Gross Debt
International Reserves (US$ billion)
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Source: IMF World Economic Outlook Database, October 2013; IBGE
Brasil: Macroeconomic fundamentals (2)
CPI Inflation (IPCA index, % YoY)
Current account results, % GDP
5
Source: Ministry of Finance*CAGED: 2013. 2014**12 months up to feb 14
Brazil: Economic and Social Progress
Formal employment and unemployment rates
Source: BCB
Brazil vs USA and Europe, unemployment rate, desazonalised, %
Income classes, millions of peopleJob creation
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Economic and social progress (2)
GDP per capita, R$ thousand - 2013 prices
Public investments in education (% of GDP)
Poverty and inequality trends
7Sources: National Agency for Civil Aviation (ANAC), National Agency for Aquatic Transportation (ANTAQ), Brazilian Association of Highway Concessionaires (ABCR) and Brasilian Association of Automative Vehicle Manufactures (ANFAVEA).
Attractive and expanding internal market
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Brazil: potential of agriculture, oil and exports
IMF EXPORT GROWTH PROJECTIONS
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SECTORS 2014Q1 US$bi 2009-12 2014-17Accumulated % Variation
Growth rate (linear avg; % per year)
INDUSTRY 372 488 31.1 5.6
INFRASTRUCTURE 181 243 34.4 6.1300
HOUSING 300 366 21.9 4.0
AGRICULTURE & SERVICES 488 624 28.1 5.1
TOTAL 1,341 1,721 28.4 5.1Source: BNDES
Brazil: investments forecast 2014-2017
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Source: BNDES
Brazil: investments forecast for industry, 2014-2017
2014 Q1 US$ billion 2009-12 2014-17Acc. % change
Growth rate (linear avg; %
per year)
INDUSTRY 372 488 31 5.6Oil & Gas 134 206 53 8.9Mining 21 23 9 1.7Automotive 19 31 63 10.2Paper & Pulp 8 11 41 7.1Chemical 9 11 25 4.5Steel 16 7 57 15.6Electronics 9 10 13 2.4Health 4 5 26 4.7Aircraft 1 6 294 31.6Other Industries 150 177 18 3.4
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Brazil: investments forecast for infrastructure, 2014-2017
Source: BNDES
2014 Q1 US$ billion 2009-12 2014-17Acc.%
change
Growth rate (linear avg; %
per year)
INFRASTRUCTURE 181 243 34 6.1Electricity 75 81 9 1.7Telecommunications 40 52 29 5.2Social Infrastructure 21 38 82 12.7Highways 23 27 14 2.7Railways 12 24 96 14.4Ports 7 17 166 21.6Airports 3 4 46 7.9
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Ongoing program of infrastructure-related concessions
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2/3 of long term loans in Brazil100% State ownedStable institutional funding Instruments
Direct OperationsIndirect OperationsMSME (financing and guarantee)Exports (Pre and Post shipment)Project financeGrants Investment bank
BNDES
BNDES KFW CDB JFC
Assets 367.8 657.3 1,191.6 318.4
Outstanding Loans 254.0 526.4 1,016.9 272.4
Net Profit 3.0 3.1 9.9 -3.6
ROA (%) 0.90 0.47 0.92 -1.13
NPL (%) 0.06 0.21 0.30 2.98
2012 (in US$ billion)
Source: BNDESSource: BNDES
Source: Banks' balance sheets.
Estimated market value (US $ b.) 45.4Nº firms with direct support 203Nº Investment Funds 44
Equity Portfolio
BNDES – highlights and comparison with peers
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BNDES’ contribution to Brazilian development (1)
*12 months, up to February/2014
to 2013
15
41 53
104
172
231261 275
811 12
2325 25
32
-5,0
5,0
15,0
25,0
35,0
45,0
55,0
65,0
0
50
100
150
200
250
300
350
2007 2008 2009 2010 2011 2012 2013
Support for MSME: disbursements + number of firms
Number of MSME, 1,000 Disbursements, US$ billion)
BNDES’ contribution to Brazilian development (2)
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Economic and social inclusion will generate opportunities to rise the consumption of goods and services and expand the housing industry.Expanding ongoing infrastructures (telecom, energy and logistics) will induce systemic productivity, improve standards of living and increase demand for suppliers of goods and services.Oil and gas will be a relevant source of foreign revenue and vast opportunities for the supply industry. Due to its consolidated competitiveness, the current export base (mineral and agricultural commodities) will continue to offer investment opportunities.Industry and services in Brazil still require higher investment in capabilities and innovation to induce international competitiveness.The real economy provides vast opportunities for private financial industry to enter into long-term financing.
Main takeaways
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Japan and Brazil Economic OutlookBrazilian Development Prospects
XVII Joint Meeting of the Japan-Brazil CommitteeSeptember 9-10, 2014