In the Networks of Knowledge Just Like Companies, Brazilian Science Is Also Becoming Increasingly Global Antonio C Arlos Santom Auro, São Paulo

Home , Alexandre Herchcovitch

now is Shanghai The place to grow Paris? New York? Career In the networks Brazilian of knowledge increasingly to US Ambassador of Brazil, according The new role Interv science i international ew

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THE BEST OF Year IV

¤ 5,00 BY CHIEKOTOKYO AOKI Number 11 Nov/Dez 2010

, totum R$ 12,00

HOW TO GO FURTHER WITH THE HELP OF

On the agency’s menu, more than 900 events every year for promoting Brazil and its companies around the world INTERVIEW INNOVATION SCIENCE Luiz Olavo Baptista, Suzano wants to The Brazilians the lawyer who be a giant in the race to is to defend Brazil in energy from recreate the at the WTO biomass cosmos

PIB12 - Capa-ENG.indd 1 09/12/10 21:32 Contents a r B A / r asal J C cello r 20 Ma ć i v e aixeta C loš Mi Nely Nely r eta

P 78 28 10 22

M CAREER With its booming economy, China is a destination PINGUI V

T 28 for young Brazilian executives looking to jumpstart their careers NELY CAIXETA, SHANGHAI

ANTENNA ARTIcle 10 Peixonauta should be the first Brazilian 36 The importance of Brazil as a source of foreign direct cartoon to be aired on US television investment in emerging markets FEDERICA MIAZZI a view from capitol hill In his first visit to Brazil, Obama is looking to EXPORTs 20 resume US-Latin America relations 38 São Paulo businesswomen open niche in US market Flávia Carbonari, Washington for specialty coffees made in Brazil TANIA MENAI, NEW YORK DESIGN Brazilian design is conquering the world interview 22 with its inventive and functional products 44 Ambassador Thomas Shannon says the US featuring a touch of Brazil recognizes the growing importance of Brazil ADRIANA SETTI, BARCELONA NELY CAIXETA, BRASÍLIA

4 P I B 48 COVER Brazilian science, just like Brazilian multinationals, is also becoming increasingly global ANTÔNIO CARLOS SANTOMAURO O ES

FASHION nt

Betting on its colorful costume jewelry, Sobral has left mo

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the beaches of Rio to conquer the world / e c i

SUZANA CAMARGO, ZURICH r Mau

URBANISM Le 64 As it gears up for the 2012 Olympics, London shows EXECUTIVE TRAVEL that it has a lot to teach Brazil 76 Company launches a tool to help future NARA VIDAL, LONDON guests learn about the hotel before paying for their room INTERNATIONALIZATION MARCO REZENDE Multinationals need to know their way around 66 intricate local legal systems when going abroad ANTONIO CARLOS SANTOMAURO EXPRESS TOURISM The pianist Pablo Rossi guides us through the BUSINESS multi-faceted Moscow, still full of remnants 72 In just four years, São Paulo company Loktal now has from its Communist days 32 countries buying its surgical scalpels PABLO ROSSI, MOSCOW PEDRO MARCONDES DE MOURA in TRaNSIT BEACON As head of a company in Saudi Arabia, 74 Founder of Costa Rica’s National Parks Service, Alvaro Brazilian executive discovers how religion Ugalde wants to export his green model rules life ANDRESSA ROVANI PAULO STRIKER, JEDDAH

P I B 5 Editorial

Totum Excelência Editorial Nely Caixeta Knowledge without barriers

PIB BRAZILIAN COMPANIES Do countries have “knowledge” borders? In terms of GO INTERNATIONAL A TWO-MONTHLY MAGAZINE FOCUSING ON geography, knowledge moves freely, but it is necessary INTERNATIONAL BUSINESS AND ECONOMICS

to have a national project in order to drive its expan- Publisher sion. And that is what we are seeing today in Brazil. As Nely Caixeta • [email protected] editor Brazil’s economy is increasingly globalized, knowledge Marco Rezende is also jumping over borders and establishing itself on Contributors to this edition Andressa Rovani; Adriana Setti, Barcelona; a global scale - though incorporation of a laboratory in Armando Mendes; Flávia Carbonari, Washington; Suzana Camargo, Zurique; Federica Miazzi, another country, as Brazilian multinationals are doing, Londres; Tânia Menai, Nova York; Nara Vidal, or establishment of virtual research centers, as Embra- Londres; Pedro Marcondes de Moura, Antônio Carlos Santomauro; Pablo Rossi, Moscou; Paulo Striker, Jedá pa has done. Photo Editor With the new industrial policy and the Innovation Law, both from 2004, Max Nogueira a favorable climate for Research & Development was created, thanks to designer greater interaction between universities and companies, simplification of Renato Dantas bureaucratic processes, creation of tax incentives, and a supply of venture cover Marcelo Calenda capital. Copydesk and Preparation The cover story of this edition shows some results of these decisions, Mary Ferrarini Translation allowing Brazilian science to advance by leaps and bounds to generate Christine Puleo e Kevin Wall knowledge, even overseas. During U.S. President Barack Obama’s visit to

Brazil, two agreements were signed to deepen the internationalization pro- ADVERTISING cess through which Brazilian science passes. The first will allow agencies INTERNATIONAL AND BRAZIL (55-11) 3097.0849 for scientific training in both countries to identify priority research areas [email protected] Av. Brigadeiro Faria Lima, 1903, cj. 33 for the two nations. The other intensifies academic exchange, essential to Jardim Paulistano - 01452-911 - São Paulo - SP maintain the cycle. PRINTING In an interview with PIB, the U.S. Ambassador to Brazil Thomas Shan- Editora Parma DISTRIBUTION IN BRAZIL non reiterates that now is the time to establish a comprehensive partner- Support: DPA Cons.Editoriais Ltda. (55-11) 3935-5524 – [email protected] ship between the two countries, with a more strategic view of what will Exclusive distributor: Fernando Chinaglia Direct sales: TecnoCourier – São Paulo be expected in the coming decades. “Obama’s visit is a moment of great Where to buy past copies: direct from the publisher importance for the history of Brazil and the U.S., and for the future,” he says. Administrative Consultant But this knowledge exchange is not only taking place with the U.S. Chi- Luiz Fernando Canoa de Oliveira na has become the preferred destination for young Brazilians in search of [email protected] EDITORIAL CORRESPONDENCE practical work knowledge. From Shanghai, a PIB report identifies many of Av. Brigadeiro Faria Lima, 1903, cj. 33 these professionals, who, though recent arrivals on Chinese soil, stand out CEP 01452-911 - São Paulo - SP [email protected] in the international marketplace. These are individuals who grew weary Signed articles do not necessarily represent of the crisis in Europe, and traded the continent for the economic boom the opinion of the editors. Totum reserves the right to edit or summarize letters. happening in the East. Legally responsible journalist The presence of Brazilians around the world - whether companies or Nely Caixeta (MTb 11 409) individuals – also constitutes a form of knowledge exchange among coun- PIB – Brazilian Companies go International is published by Totum Excelência Editorial tries. An example of this is Pablo Rossi, a musician who studied in Moscow Av. Brigadeiro Faria Lima, 1903, cj. 33 CEP 01452-911 - São Paulo - SP and attracts the attention of worldwide experts when he takes at seat at (55-11) 3097.0849 - [email protected] the piano. It is he who takes the PIB reader on a tour of eclectic Russian Print run for this edition Portuguese – 16.000 architecture, with strategic stops to sample a good shot of vodka to get a English – 4.000 better grasp of Moscow’s history. These are the frontiers of knowledge that are dissolving. Print run audited by Nely Caixeta

6 P I B

Letters THE BEST OF BY CHIEKOTOKYO AOKI

Year IV 5,00 ¤ Number 11 Nov/Dez 2010 ,

totum R$ 12,00 R$

Dear editors HOW TO GO FURTHEROF “I enjoy reading PIB as it reports on the WITH THE HELP experience, dilemmas and challenges faced by Brazilian companies in their internationalization process. We know this is a long road, lined with both opportunities and challenges. In this context, sharing knowledge and experience is crucial to the development of global Brazilian players. PIB is a source of information for my students and others interested in every year 900 events world agency’s menu, more than the process of internationalization.” On the Brazil and its companies around the for promoting SCIENCE INNOVATION The Brazilians INTERVIEW Suzano wants to in the race to Ricardo Pimenta Luiz Olavo Baptista, be a giant recreate the Professor at Fundação Dom Cabral the lawyer who in energy from cosmos is to defend Brazil biomass Technical coordinator of Network at the WTO 09/12/10 21:32 of Integrated Development PIB12 - Capa-ENG.indd 1 Belo Horizonte (Minas Gerais state)

“PIB is an excellent informative vehicle for and flowing language, the cover story of the people involved in the international business last edition helped my students understand the world. It has helped fill the gaps and cater to a scope of ApexBrasil’s activities and to realize segment lacking in up-to-date information and that Brazil is a land full of opportunities.” with a real scope of Brazil’s effective inclusion Libia Lender Macedo and participation in the international arena. Coordinator of MBA in Management and For international relations students focused on Marketing of Sporting Entities international marketing and business, it is a Universidade Anhembi Morumbi / Laureate must read. It is also published in English, which International Universities enriches the international business repertoire”. São Paulo (São Paulo state) Professor Sérgio Pio Bernardes Director of Graduate Courses on Marketing “I managed to read PIB for the first time and Business at Escola Superior de and I really enjoyed it. I would like to acquire Propaganda e Marketing (ESPM) both previous and future editions.” São Paulo (São Paulo state) Piotr Kulka Manager Eastern Europe “My husband and I have been living in the US for Business Support Center - ApexBrasil the last 21 years. This is the first time we have Brussels discovered a high-quality magazine focused on Brazilian companies. We receive PIB at our law “What a wonderful magazine, tracking Brazilian firm (Somera & Silva) and we would like to know companies abroad such as my company Carioca if we can buy it in the US or over the Internet.”* Love, a clothes line created in France in 2008. Celia Aiosa The magazine is a great window to show off the Ocean Boulevard talents of Brazilian companies, which include the Boca Raton, Florida fashion and design areas. I loved it. Massive hit!” Magnolia Oliveira “I have only just discovered PIB. I am always Marseille trying to keep my students up to date with Brazils prospects both abroad and at home, To acquire past editions of PIB, please send your and the current trends. With didactic, complete request via email to [email protected]. Please address letters and e-mail to: The Editor, PIB – Avenida Brigadeiro Faria Lima, 1903, cj 33 – São Paulo, SP, 01452-911 – Brazil; [email protected]

8 P I B Plans to expand

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10970-EN-V6-fit amcham-202x266.indd 1 08/12/10 14:23 Antenna Andressa rOvani Animated Exports

The star of the show is a goldfish in a space suit who works as a secret agent for sustainability. The first animated series produced in Brazil, “Peixonauta” (or loosely translated into English, Fishstronaut) from São Paulo’s PinGuim studios, is already seen in 65 countries. The goldfish promises to be a great accomplishment

in the sector. This year, it will appear on the U.S.- M based Discovery Family network, and the show will be PINGUI V

the first Brazilian animated program to become part T of a U.S. network lineup. But the swimming secret 1 agent is not the only one. “Meu AmigãoZão” (My Big, Big Friend), coproduced by 2DLab of Brazil and Breakthrough of Canada, is broadcast in Brazil and Latin America by Discovery Kids. “Princesas do Mar” (Sea Princesses), from Flamma Films, with production support from Australia and Spain, has been sold in more than 120 countries. Along with “Peixonauta,” the series “Meu AmigãoZão” has also closed a contract in the United States, and its characters will soon become familiar faces to American children. For Eliana Russi, the executive director of the international project of the ABPI-TV (Brazilian Association of Independent TV Producers), this is just the beginning. “Brazil is seen by international producers as a potential partner, and this visibility has increased business opportunities,” she says. The boom of Brazilian creations and their successes abroad is the result, according to Eliana, of a Brazilian TV Producers export project, created by ABPI-TV in 2004, in partnership with Apex-Brazil, the Secretary of Audiovisuals of the Ministry of Culture, and EBC/ TV Brazil. Eliana recently participated in KidScreen in New York, an annual event that joins together those working at both ends of the international chain of children’s animation. Attending the event were 35 independent Brazilian producers. During the meeting, an agreement was announced between Sumatra, of São Paulo, and Toonzone, from the U.S., to make the

animated series “Tiny Warriors.” The international co- M production, to be produced byToonzone with animation PINGUI V

from Brazil, is an example of binational symbiosis. T 1

10 P I B 1 Peixonauta 2 Brazilian cartoon and wine creative promoted team in U.S.

Wine, BBQ and Indy Races The race by Brazilian winemakers to win over the American market is starting to pay off. The Americans are buying more wine produced in Brazil. Thanks to a marketing push, 22 Brazilian wines labels now appear on the menus of churrascarias (traditional Brazilian BBQ restaurants) located in the United States. The past year, Brazilian churrascarias Fogo de Chão and Plataforma, held a promotion in their U.S. restaurants, in which they distributed tickets to the Indy races to customers ordering a Brazilian wine. It was a way to introduce customers--who are trying out Brazilian products--to taste and enjoy the drink produced in Brazilian vineyards. With the demand, Casa Valduga’s sales grew from a modest US $643 in 2009 to US $98,400 last year. Perini, another winemaker, doubled its exports to the United States, jumping from US $15,700 in sales 2009 to US $29,200 in 2010.

2 UT O AND H l/ asi Br pex A

P I B 11 Antenna 1 Letícia, Fernanda 2 Eurofarma: 3 Maria Del Pilar: and Ederaldo, strong presence goal to cover in Moscow in Latin America 90% of market

To Russia with love The successes of Brazilian national cinema brought, for the third straight year, a legion of Russians to the Brazilian Embassy in Moscow. The project, which integrates private and public efforts, aims to disseminate Brazilian culture in Russia, presenting contemporary Brazilian films to one of the most important emerging economies in the world. “The show, promoted at the end of last year, is already part of the Russian capital’s cultural calendar,” says Ederaldo Kosa, the event’s curator , together with Fernanda Bulhões. Among the attractions are the comedy “Deus é Brasileiro” (God is Brazilian) and drama “O Maior Amor do Mundo” (The Greatest Love in the World), both by Cacá Diegues, as well as the acclaimed “ É Proibido Fumar” (No Smoking) by Anna Muylaert. Over the three years, 40 films have been shown to Moscovite audiences. The event is the result of a partnership between the Linhas Comunicação agency, the Ministry of Foreign Relations, and the Brazilian embassy in Moscow. UT O AND H 1 Remedies for the neighbors In 2009, Eurofarma, founded in 1972, made its first international acquisition: Quesada Pharmaceuticals, a company with 60 years of experience in the Argentine market. Last year, two other Latin American companies were included in the group: Gautier Laboratory, with 93 years in the Uruguyan pharmaceutical market and a presence in Paraguay and Bolivia, and Volta/Farmindustria Laboratory, operating in Chile for 60 years. The sequence of acquisitions shows the importance that the pharmaceutical company, with headquarters in São Paulo, is dedicating to international expansion. “Eurofarma already has a presence in six countries, representing 52% of Latin America,” says the company’s director of ia

Sustainability and New Business, Maria h Del Pilar Muñoz. “Given that the goal is ub lo So to cover 90% of the regional market, we e rc

still have a good challenge ahead of us.” Ma 2 3

12 P I B AND

Antenna

Organics’ sweet moment

Participation in trade fairs abroad was for Promotion of Development), sugar. The two largest producers of the secret to leveraging the export of and benefited 72 companies that the product in Brazil that are part Brazilian organic products. In 2010, manufacture items ranging from of the project, Native and Jalles US $ 108.2 million in goods were a local type of herbal tea (“mate” Machado, represent about 70% of sent abroad though the Organics tea) to cosmetics. Of the total all organic sugar consumed in the Brazil project - an increase of 130% organic products sent to the world market. Besides sugar, Brazilian compared to the previous year. international market last year, the companies are exporting fruit pulp, The program is a partnership between food sector accounted for 96%. honey, cashew nuts, and industrialized Apex-Brazil and IPD (Institute The highlight is organic Brazilian products like grains and coffee. 1 l o asi ad Br ch s c Ma

es gani ll r a O / ut UT/J o O AND Hand H

Exporting animal health The São Paulo company Ourofino Agronegócio, action and releases the product on a scheduled basis. manufacturer of veterinary products, has an eye on Another product, Impact, is highly sought after to neighboring countries to increase its sales abroad. Last combat ticks and fleas with a low level of toxcitiy. year, Latin America was the region that recorded the Currently, the foreign market, comprising 29 countries, greatest sales growth, which jumped 19% compared represents 7.5% of Ourofino revenues. to 2009, when revenues totaled R $ 221 million. The result is so significant for the The company produces medicines for cattle segment that the company received and horses, as well as small household pets, the Export São Paulo award from at its headquarters in Cravinhos (SP). Animal the Federation of Trade Associations health is the focus of the company, which also of the State of São Paulo (Facesp), invests in seed and crop protection products. in partnership with the Secretary Ourofino’s flagship products are two substances used of Development and Commercial to kill parasites on animals. Master LP has prolonged Association of São Paulo.

14 P I B 1 Production and 2 Exotic fruits 3 Veterinary product: Jalles from Brazil drugs: focus Machado sugar gains market on Latin America Atemoya, oh my!

Little known in Brazil, the exotic 2 atemoya been having overseas success at the hands of ViveiroBona Farm, which has plantations in Paraisopolis, Minas Gerais. With production of 400 tons per year, about 10% of the fruit is sent abroad, especially to Canada and Portugal. But this share will grow. This year’s harvest produced suprisingly larger and higher quality fruit compared with last year. “We will be able to export between 5% to 10% more because the harvest will be better, “ says François Bonaventure, responsible for exports for Viveiro Bona. To reach the international market, an atemoya must weigh between 350 and 550 grams. The company today exports 45, 000 cases a year. Shipments are made by air twice a week, on Wednesdays and Sundays, via Guarulhos airport, to ensure that the fruits arrive fresh to end consumers. The fruit is Ecocert-certified as organic agriculture and is waiting for r ei rr

Globalgap certification to meet all a P ia

international requirements for export. B

3 o i oc neg ro g o A in rof Ou

tesia cor

P I B 15 Antenna

1 r ae r b Em

Embraer flies high with executive jets Worldwide, one in five executive jets to the company, six new jet model delivered last year bears the Embraer were launched over the past six logo. This data is part of an audit years. The top seller is Embraer’s released in February by Gama (General Phenom 100, which represented 100 Aviation Manufacturers Association). of the 145 units sold during the year. The Brazilian company delivered 145 Following this came, among others, executive jets in 2010, an increase of the Phenom 300, in operation for 23 planes in relation to 2009, and the just one year and with 26 sold, and greatest increment in absolute terms the Legacy 650, with 11 deliveries. among all manufacturers. Reaching “We will continue to strive to further this new level, Embraer’s share in improve our results, winning new the sector hit 19%; in 2008 this clients and better serving our current percentage was just 3%. ones,” Luís Carlos Affonso, Embrarer The sales success is partly linked to vice-president of executive aviation investment in innovation. According market, said in a statement.

16 P I B 1 Phenom 100 2 The Duplo executive jet: Dinâmico is a Embraer’s turn Gerbar creation

Pirate against piracy Created 48 years ago, Duplo Dinâmico is two of the main fan models in China today the flagship product of the Gerbar with investment of only US$12,000. Fans factory of São Paulo. With two With the strategy, the situation was reversed. engines and a striking design, the ceiling The new product made in China by Gerban fan was designed by Geraldo Barros, the competes directly with the pirated versions founder, and is still produced by hand. made there, and exported in particular to It is the best selling model abroad and is the United States, the company’s major responsible for globally disseminating the market. Sold under another brand, the quality of the Brazilian factory, known as one of products cost half as much as the similar the best in the world. Today, the foreign market versions made in Brazil. The production costs represents 30% of revenues for the company, are just a fourth of the investment made in which ships products to six countries. “We Brazil. It is as if the company had bet on a have exported for more than 20 years, and the pirated version of its product to keep up in numbers doubled every year,” says Claudia the market. “In a way, it competes with the Spina, owner and granddaughter of the founder. product we produce here and export,” says The fall of the dollar, she says, about four years, Claudia. “It was an option we found to offer led to decreased international sales, which an option for those who like the design but previously accounted for 72% of company sales. cannot afford to pay [for the original].” Besides the dollar, the success of the model In both markets, however, she also sells led to similar models appearing in China and the ‘original’ version, made in Brazil, which, the United States, of lower quality, competing she says, has rigid standards of quality and with the original made in Brazil. After suing first-class materials. The Chinese version these factories, owner Claudia Spina says of its products now accounts for the she began to see an opportunity equivalent of 10% of the company in the dispute. Two years ago, revenues. “The products made in she started to manufacture Brazil are still sold more abroad.”

UT O AND H

P I B 17 Antenna Kris: Flanders wants Brazilian businesses

questions 3 for... Kris Peeters, minister-president of the Flanders region of Belgium UT O AND H

Despite being an important European globalized country in the world for the fourth 1logistics center, the region seems consecutive year. This means that nearly all to be little known in Brazil. Why? cultures and countries are represented in our I do not think this is so. Brazilian companies country, which brings numerous advantages that operate in international logistics are to international companies in terms of aware of the importance of the port of Antwerp business. Among our strong points I can (in the northern region), which is Europe’s highlight are labor laws, quality of manpower second largest port and second-largest and research institutes, location and very petrochemical complex in the world, surpassed interesting tax measures. Flanders also has only by Houston (in Texas). Brazil is the largest the lowest amount of time needed to start a customer of the port of Ghent (in the western business, and a minimum of bureaucracy. region), which handles a wide variety of Brazilian imports, such as minerals and fruit juice. This Is the Flanders region interested is the biggest port for citrus juice in Europe and 3in hosting Brazilian biodiesel the second-largest in the world. The port of companies looking to offer products Zeebrugge (in the far west) is the world’s leading to the European market? center for transport of new cars. Flanders is the Flanders has created a “Bioenergy Valley,” best place to do business in Europe. headquartered in Ghent. To promote economic development around this, we will Many European centers with encourage technological innovation, industrial 2characteristics similar to Flanders integration and hub formation, in addition are working to attract foreign investors. to awareness-raising in order to gain market What special advantages does Flanders share for biofuels. Recently, CBL (Brazilian offer to a Brazilian company? Logistics Company), one of Brazil’s largest Flanders is in the center of Europe, and logistics companies, announced investment major decisions related to the region are of 70 million euros in a storage terminal for made in Brussels (the capital of Belgium and liquids (biodiesel, gasoline, ethanol, and the headquarters of the European Union). vegetable oils) in the port of Ghent that has Besides this, we were named the most already received 1.3 million tons of biofuels.

18 P I B

A View from Capitol Hill News from the US with a Brazilian slant Flávia Carbonari

The Obama administration prospect of a new era of economic brought, in 2009, hopes for a stability and growth in the region, rebound in relations between the which grew by 6% in 2010, the U.S. and Latin America, which were call for re-engagement has echoed put on hold during the Bush era. strongly in policy analysis circles in Two years have passed and little has Washington. A rapprochement with been done to strengthen relations Brazil, whose bilateral relations with between the two hemispheres. the U.S. were shaken after nuclear Although the U.S. is still the region’s discussions with Iran in 2010, and largest trading partner, it continues the crisis in Honduras in 2009, to lose part of the market to China. comes at a good time. Brazil has a Between 2002 and 2008, the new government, the U.S. a new market share of the U.S. in the eight Congress, and the Obama adminis- major economies of the continent tration is making up for lost time in fell from 49% to 38%, as China’s the last year before the next presi- grew from 4% to 10%. Over the dential election. During Obama’s Time to past two years, the Asian giant has first visit to Brazil, some issues have taken the position of largest trading not escaped discussion: energy, discuss the partner for Brazil and Chile, and will climate change, and potential new l Jr/ABr

soon claim this position in Peru. partnerships for the World Cup and Casa

llo relationship But, due to a vibrant and the Olympics. e rc

optimistic Latin America, with the Ma 1 2 A visit to any café in Washington, from the most traditional to the Capital of most alternative, even on a sunny holiday, can surprise a visitor: the reading... competition to get a table in the midst of so many laptops, books, and newspapers is stiff. It is no wonder that, with 600,000 inhabitants, the city was named in 2010 as the United States’ “capital of reading.” Ranked since 2005 by Central Connecticut State University, the America’s Most Literate Cities Index is based on six indicators: newspaper circulation, publication of specialized magazines and journals, access to newspapers or buying of books via the Internet, number of bookstores, library resources, and level of education. Washington led the ranking i r of the top three, finishing at the top na o b

r of list for the first time, followed by Ca

ia Seattle, leader in the rankings in v a l F

previous years.

20 P I B 1 Meeting: 2 Café in Dilma and Washington: Obama at a place Alvorada to read Palace

China and the American dream

China is the second-largest economy in the world, and it is projected 01that in ten years it could surpass the U.S and become the largest. A survey by the Pew Research Center, in Washington, showed that nearly half of the American population (47%) believes that China is the largest economic power on the planet, compared with 31% who cited the U.S. as the holder of this position, in this unprecedented research. Ano- ther surprise was the fact that 47% of Americans named Asia as the most important region for the U.S., against 37% who gave this priority Revolution in the to Europe. The study also showed ...Industry that one in five Americans considers China the biggest threat to of ideas digital media age the country, ahead of North Korea The city - which has nearly 400 Since the 2009 elections in (18%) and Iran (12%). think tanks and 20 universities - is Iran, when residents protested the THE STRENGTH OF EACH the economic engine of “the market repression via sites like YouTube, China is seen as an economic power; of ideas. “ Since Georgetown sto- Twitter, and Facebook, the number the USA as a military power pped serving as a port in the 18th of analysts trying to understand 6% century, the main export products the impact of social media in global EU Division of 7% Other/ have become books, reports, and geopolitics has grown. In January, economic DK policy analysis. Just as multina- the State Department offered US$ power 9% tional corporations started to do 30 million for projects that include Japan 47% decades ago, American think tanks Internet freedom programs to re- China 31% are also expanding their markets, move firewalls imposed by oppres- United as is the case with the Carnegie sive governments. “All dissident States Endowment for International Peace, movements will have technology 3% EU which has stepped its toe into Bei- as a key component, “ said Alec 5% Russia jing, Beirut, Brussels, and Moscow. Ross, an adviser to Hillary Clinton. Division 9% Other/ of military 16% DK China claims to have more than But, in an article in Foreign Affairs, power China 400 today, which would make it the the American professor Clay Shirky country with the second-largest says that the power of social media number of think tanks in the world. lies in strengthening civil society, 67% which only produces changes over United States Source: Pew decades. Research Center

P I B 21 Design Brazil’s DNA From jewels to computing, Brazilian design is conquering the world with inventive and functional products Adr i an a Set t i, Barcelon a

n December 2010, out of the herme Leite Ribeiro (from the Nada ity of Brazilians, and the strong 11 expositions on display at Se Leva study in São Paulo), the Rio economic momentum and visibility the world famous Trienalle de Janeiro artist Lúcio Carvalho and achieved by Brazil in recent years Design Museum in Milan, the Espírito Santo architect Paulo (which includes having been cho- two had a Brazilian theme. Mendes da Rocha (winner of the sen to host the 2014 World Cup and IBrasília, Uma Utopia Realizada pro- 2006 Pritzker prize). Such strong the 2016 Olympics) are producing vided an outline of the history of interest in Brazilian designs and positive results in a whole host of Brazil’s capital city (known as plan- forms at this global design and arts activities. And it’s no different with alto central) via the forms idealized Mecca has its raison d’être: follow- design. “Our front line is Brazil as by the Rio de Janeiro architect Oscar ing the path ploughed by Niemeyer a whole, and it was up to us to suc- Niemeyer. Simultane- and fellow Rio de Ja- cessfully occupy the space created”, ously, Anticorpi An- neiro citizen Sergio explains Joice Joppert Leal, execu- tibodies illustrated Innovative Rodrigues (creator tive director of São Paulo-based the trajectory of the materials, of the coveted Pol- Associação Objeto Brasil. Founded São Paulo designers and “bold” trona Mole, perhaps to promote Brazilian design, Ob- Fernando and Hum- the first modern Bra- jeto Brasil organizes, among other berto Campana. In forms zilian design product events, Idea Brasil – the national the same Italian city, make the to take the world by version of International Design Ex- months earlier, the difference storm) and, more re- cellence Awards (the most presti- famous Fuori Salone cently, by the Cam- gious US design prize). “Brazil has circuit, which takes pana brothers, Brazil always been held in warm regard place in tandem with the world’s has increasingly more heavyweight abroad. We are seen as nice, friendly most renowned furniture showroom names dictating trends abroad. and jovial by foreigners and, in re- (Salone Internazionale del Mobile), Gringos have finally discovered that cent years, due to globalization and received the Brasil S/A Lounge the “made in Brazil” style can be im- the opening of our market, the in- Brasileiro de Decoração e Design ex- printed onto something more than ternational community now knows position, featuring renowned names just flip-flops and swimwear. a lot more about Brazil,” she says. such as the omnipresent Campana The highly diversified Brazilian From the viewpoint of style, do brothers André Bastos and Guil- culture, the flexibility and creativ- Niemeyer, the Campana brothers

22 P I B Chair by Rodrigo Almeida, from Sorocaba (São Paulo): aesthetic miscegenation eida o Alm ig r d o R o: t o F

P I B 23 Design

and the new up-and-coming Bra- characterize the furniture and and the jeweler Antonio Bernardo zilian designers have anything in other objects produced in Sweden, (both from Rio de Janeiro), and the common? Not necessarily. Although Denmark and Norway. Rio Grande do Sul businessman Os- bright colors and, in some cases, the Although there are no explicit kar Metsavaht, owner of the Osklen references to Brazilian folklore may aesthetic elements that define “Bra- clothes brand, among many oth- be present in some of their work, zilian Design”, the observation that ers. In its 2010 Design Awards, the the phrase “this is the face of Bra- something very effervescent is hap- Wallpaper magazine also awarded zil” cannot be applied to all aspects pening in Brazil is the consensus. a prize to a house signed by the São of Brazilian design. “The innova- During some weeks last year, Wall- Paulo architect Marcio Kogan. tion, the differentiated use of ma- paper (a British reference maga- Another international reference, terial, concerns with sustainability zine) established temporary head- the British newspaper The Guard- and the boldness that, in general, quarters in what it defined in its edi- ian, published a special article in we apply enable our products to be torial as “the world’s most exciting which it stated that “Brazilian de- accepted anywhere in the world”, country”, in order to try and outline sign, from fashion to architecture, says Joice. “Good design doesn’t a portrait of this moment of Brazil’s previously recognized simply for necessarily have to be recognized ascendency and how it reflects in its flamboyant nature, is being ac- as typical of a certain place and, at Brazilian cultural and industrial cepted for its inventiveness, origi- the same time, we don’t have such production. The result is the dossier nality and diversity – reflecting an an emblematic line as, for example, Born in Brazil, featuring reports and unusual mix of influences”. And it Scandinavian design”, she explains interviews with people such as the cites factors ranging from urban referring to the ergonomic, func- architect Paulo Mendes da Rocha, chaos, the Amazon region, sugar- tional and minimalist forms that the graphic designer Felipe Taborda cane plantation workers and the

Winners Some of the 23 winning Brazilian products at the iF Design Awards 2011, in Germany

24 P I B 1 Itautec Self 2 Ceramic Check Out jug from (São Paulo) The Led Project (SP)

gothic movement as the salad of (Shanghai) in China, and whose 3 João de 4 BioKit for factors from where Brazilian artists work is recognized (and sold for up Barro salt Electoral Courts, get their references to produce ob- to 20,000 Euros) in global design cellars, by by Akiyama jects, clothes, furniture, buildings capitals such as Milan, Paris, New Reboh Design and Dangelo and jewels that are simultaneously York and London. Famous for creat- (Rio Grande Di (Paraná) original and compatible with the ing objects out of unlikely elements do Sul) contemporary market. The names and combinations (such as, for ex- mentioned include the São Paulo ample, making a lamp out of a pair stylist Alexandre Herchcovitch of tennis shoes), Rodrigo also writes and the graffiti artists Gustavo and a column in the specialized Italian Otávio Pandolfo, “The Twins”, also magazine MADE. However, he has strings reminiscent of Rastafarian from São Paulo. only just launched dreadlocks. Another of Rodrigo’s If, on the one his first collection creations, the Oxum chair, has hand, already rec- British by a Brazilian com- brightly colored appliqués and is ognized names in magazine pany, Dpot. “People covered by wooden beads reminis- Brazil are becom- “Wallpaper”: in Brazil always cent of candomblé. “We have to be ing more prominent want to repeat what who we are, instead of seeing our- abroad, another wave Brazil is world’s has already worked selves from a foreign perspective”, of Brazilian designers most exciting abroad… no one says the designer. conquering the inter- country wants to innovate,” Another increasingly well- national market have says Rodrigo, whose known name in international edito- something in com- success abroad is at- rials is Fernando Akasaka, from São mon with contemporary Brazilian tributed precisely to his originality Paulo. His F.Akasaka brand, found- musicians such as Seu Jorge, Bebel and focus on Brazilian culture, to ed in 2006, is dedicated to the cre- Gilberto and many others: success create that which he calls “aesthet- ation of furniture, lamps and deco- abroad came before national recog- ic miscegenation”. In practice, this rative objects. Le Blob, created by nition. “Around 90% of what I pro- means objects such as the Salvador Fernando in 2009, is focused on ul- duce goes abroad”, recalls Rodrigo chair. In an allusion to the state cap- tra-creative jewels. The first brand Almeida (from Sorocaba, São Paulo), ital of Bahia (Salvador), the back of gained international fame thanks who last year presented his work at the chair is lined by a fabric with a to the media, with appearances FAT Galerie (Paris) and Contrasts texture similar to that of a net and in magazines such as Blackbook UT O AND H : s o t 3 4 o F

P I B 25 Design

HANDOUT 1 1 UT O AND H

(US), Ideat (France) and Wallpa- Development, Industry and Trade, tion of the products recognized per (UK). Once he became known, to disseminate locally a culture of (in the form of prizes/awards) by in order to sell his products under production and exporting of more the market”, says Brum. In the last the Le Blob label, Fernando suc- attractive, efficient and, thus, more edition of iF Design Awards, Bra- cessfully sought out famous inter- competitive products. The promi- zil was the 8th best ranked coun- national stores such as the concept nence achieved by the design seg- try, with 23 products ranging from store Eva, in New York, The Shop at ment in recent years has also led computers to a porcelain moringa Bluebird (London) and the boutique specialized courses to emerge that reinterprets the humble clay Looq (Zurich), including other ad- throughout Brazil. In 1980, Brazil moringas used to cool drinking dresses in Sydney, Copenhagen and had six industrial design schools. water in Brazilian houses of yes- European and global capital cities. Today, Brazil boasts 300 graduate- teryear. For the screening process “I do not follow specifically Brazil- level courses and another 100 tech- that precedes participation in the ian patterns or char- nical courses. acteristics, I look to “Companies are 4 create objects with Brazilians increasingly aware a contemporary de- that efficiency in the sign”, he says. “My won 23 prizes productive process companies operate in in the and quality control the segments of lux- European are not enough”, says ury decoration and Ana Brum, project fashion and, in these iF Design coordinator of the markets, clients basi- contest Paraná Design Cen- cally seek an innova- ter, a non-profit orga- tive design, product nization responsible quality and exclusivity”. for the Design Excellence program As well as launching individu- that, among other things, has the al talents that benefited from the support of the Brazilian Agency opening of our markets, from a for Promoting Exports and Invest- business point of view Brazil has ments (ApexBrasil) to select and also realized that the visual im- register national products in the IF age of its products is fundamental Design Awards, the main European to the competitiveness of the na- design award, based in Hannover tional industry. An example is the (Germany). “International awards creation, in 1995, of the Brazilian currently work as a certificate of Design Program by the Ministry of quality and facilitate the absorp-

26 P I B 1 Jewel and 2 Felipe lamp by Taborda Fernando poster (Rio Akasaka (São de Janeiro): Paulo): quality Brazilian and exclusivity graphic arts

3 Lúcio 4 House in Carvalho (Rio Paraty by de Janeiro): Marcio Kogan furniture in (São Paulo): Milan awarded by “Wallpaper”

3 UT O AND H 2 3

IF Design Awards event, the De- al press) and the Idea Brasil prize, sign Excellence program received whose first edition was in 2008, are over 500 candidates (of which 60% proof of the dimension of the change UT were small and medium-size com- O in mentality in Brazil. The winners AND panies). “When design is part of H of the Idea Brasil award automati- the company’s strategy, the return cally qualify as finalists in the Idea is always positive, something that Awards event in the US. In 2010, doesn’t happen when it is treated one of the winning Brazilian ideas merely superficially”, says Brum. included the FIAT FCC sports car The creation of a Design Show in (Fiat has a Style Center in Betim, 2006 (the 2010 edition had a posi- Minas Gerais, which is one of the tive repercussion in the internation- most modern in Brazil), Embraer’s Legacy 500 and Legacy 450 executive jets and Itautec’s Self Check Out (a machine where the client can pay his own bills), proving that Brazil’s potential also covers the industry of high technology and electronic equipment. “The prize helped us achieve the recognition that was lacking and paved the way for Bra- zilian design in the US”, recalls Joice Joppert Leal. Between 7 and 12 December 2010, creations by over 40 finalists from the three years of IDEA/Brasil (which has SEBRAE, ABDI and CNPq as its partners) were presented in Seoul, elected the global design capital in 2010. “Are we creative? Yes, but our stance is no longer merely instinctive. We also have the know-how and know why,

n and our self-esteem is soaring”, con- Ko n

o cludes Joice. Our Carmen Miranda s l e

N aesthetic is a thing of the past.

P I B 27 Career

The world’s fastest-growing market is attracting young brazilians Chinese in search of opportunities to jumpstart their careers shortcut Nely C a i xeta, Sh angh a i 28 P I B Giovanna, Kevin, Taís and Stephanie, with the Pudong district in the background: it´s all happening in Shanghai

city on the delta of the Huangpu River (on China’s East coast) to a CHINA BY THE megalopolis symbolic of the stun- ning growth of the Chinese econ- (MASSIVE) NUMBERS omy. It is in this city of 18 million inhabitants that a growing group 5,700 Brazilians of Brazilians is touching down in currently live in China search of work opportunities and a type of experience increasingly visas valued by headhunter companies 41, 642 were from Brazil and anywhere else in granted to Brazilians last the world for that matter. “You have year, 54% more than in to actually be here to really under- 2009 stand the speed at which things more than happen in China”, says Rafael Nu- in 2009 ñez Sá Freire (27), an advertising 54% agent from São Paulo who has been The number of visit and living in Shanghai for three years. business visas grew by “It is a real privilege to follow these changes and to try and understand, 73% in 2010 together with the rest of the world, what the Chinese are like.” enough that China helped fast track Before moving to China, he me in one of the most competitive spent almost 7 years in London, professions in the world”, says Ra- where he graduated in graphic fael. At the ad agency, he writes in design and advertising. The pace English for the regional campaigns of his career in London frustrated of Ford, frequently in partnership him. “In London, I quickly realized with a Chinese editor. “My work is that I would take years to get my international”, he says. “I always try hands dirty and actually participate to adapt to what I am doing, pre- in the creation of interesting cam- cisely because I have experienced paigns”, says Rafael. “It was when I and learnt about so many different visited Shanghai that I realized that cultures.” Caixeta there were excellent opportunities Around 5,700 Brazilians cur- y l e

N for young adults such as myself.” rently live in China, according to And his work as a senior adver- the latest estimate of Brazil´s For- tising agent at the multinational eign Affairs Ministry. Three years orget about London, Par- J.W. Thompson has indeed given ago, this number was 3,500. This is and New York! The him both personal satisfaction and figure pales into comparison with thriving nature of Chi- international recognition. Last year, the 280,000 Brazilians living in nese cities has attracted he won two lions at the Cannes Japan or the 1.28mn living in the an increasing number of publicity festival, the main sector US – two of the largest Brazilian Fyoung professionals interested in awards event. He is also one of the communities abroad. However, go- jumpstarting their professional ca- best three editors in the world, ac- ing against the grain in terms of reers on the other side of the world. cording to the UK publication “The your usual migratory flow to de- With its broad avenues, recently- Big Won Report”, which each year veloped countries, those who go to constructed gardens and futuristic elects the best professionals from China don’t go with the intention of skyscrapers that house companies each advertising segment. In the making some pocket change from from all over the world, in just a few Chinese ranking he is the number manual labor or from humble jobs years Shanghai has gone from a port one editor. “I reckon that’s proof normally reserved for immigrants

P I B 29 Career

in rich countries. In China, there The global financial crisis, initi- specialized in helping businessmen are lots of people already willing ated in 2008 and which is still affect- looking to expand their business to to perform menial tasks. The net ing the US and European economies, China. Ponce landed in Shanghai in result of millions of people and low helped put China on the map for 2008, after concluding his master’s labor specialization is a world of op- Brazilians looking to work abroad. degree in International Manage- portunities “both for young people One example is Fabiano Ponce (32), ment at Grenoble (France), where he interested in improving their CVs an executive director from Pangea worked in the procurement division and for businessmen looking to International, a Brazilian foreign of Hewlett-Packard. “With Europe make good deals. trade company and consultancy not offering anything interesting, I

30 P I B Freire, from JWThompson in Shanghai: awards at Cannes

And if he’s got his eyes on China, then Brazil has got its eyes on him. A short while ago, Ponce says he received a call from a Brazilian headhunter interested in his international experience – and, especially, in his capacity to manage businesses based in Miami and with 700 stores both in the East and anywhere else around the world. in the world. It offered him a mana- The company’s main product is gerial post at a multinational based watches, followed by bags, wallets in Brazil. “I politely declined”, he and belts. “I travel around China says, adding that now isn’t the time looking for suppliers and I have to leave Shanghai. “I am at a com- the incredible opportunity to par- pany with excellent prospects”. ticipate in the entire process – from The prospects genuinely seem to creation, to production, inspection be promising. A study by the McK- and even exports”, says Stephanie, insey consultancy firm shows that, who studied fashion in Paris and in order to grow at the desired rate, worked at M. Officer in São Paulo the Chinese economy will need and at the atelier of Lino Villaventu- to find around 75,000 qualified ra before being seduced by China. “I workers by year-end. Four years never imagined that one day I would ago, China had between 3,000 and be living here”, she says. 5,000 executives. In 2010 alone, the Stephanie’s journey is the com- country recruited 480,000 profes- plete opposite of Giovanna Barb- sionals from abroad, according to ieri (25, from São Paulo), who had the State Administration of Foreign always had China in her sights. To Specialists. convince her parents that it made For young executives, being in sense to visit the Far East, she en- China today is a win- rolled for a study dow display to show grant from the Chi- off their talents. Art- Chinese nese government to ists, stylists and trend experience take her MBA. Today, hunters have chosen has put she is a ‘cool hunter’, Shanghai as the place following fashion to be. Although Chi- executives on trends and behavior na is still labeled as a headhunters´ in the shop windows country that copies a radar screen and streets of Chi- lot and creates little, nese cities. Giovanna ut o a growing number of provides services to

Hand foreigners are coming to China to companies such as Tavex (one of follow the fashion trends sprouting the world’s largest denim producers decided to go elsewhere”, he says. up on its streets and in its stores. and a subsidiary of Brazil’s Camargo He obtained a study grant and went The Brazilian Stephanie Dubus (25) Correa group) and women’s cloth- to Shanghai to take his course, en- is one of these scouts in China. Born ing chain Le Lis Blanc. titled “How to do business in China”, in Ceará, with a Brazilian mother “I bucked the trend of visiting at the Shanghai Institute of Foreign and a French father, Stephanie has the worlds global fashion capitals Trade, as well as learning mandarin spent almost two years in Shanghai, and came to China instead”, ex- Chinese. “I sought enriching experi- where she is responsible for devel- plains Giovanna as she shows us her ences, from both a personal and pro- oping and producing the collec- “Tofu in China” blog – which she fessional standpoint”, he says. tions of the US brand Bijoux Terner, fills with her everyday living expe-

P I B 31 Career

riences in China. It’s Number purposes, according mous”, she says. Here you are rec- a decision she didn’t to Lin Xiaoyu from ognized and admired for what you regret, although she of visas the Chinese Em- do, regardless of where you come admits that course granted to bassy in Brasília. In from or how much you have. What levels are inferior Brazilians 2006 as a whole, this matters here is what you have to of- to Brazil and that number was 20,000. fer”. After spending a long period teachers aren’t re- doubled In other words, the in Paris, Tais said she grew tired of ally equipped to give in four years number of Brazil- the lack of dynamism there. “Then, classes in English. ians that traveled to I heard from a friend that Shanghai “Living in China en- China – temporarily was the laboratory of China”, she sures that we become more global- or permanently – doubled in 4 years. says. “Everything that was about to ized”, she says. “The competition is Part of this growth comes from ex- happen was going to happen here, huge and, if we don’t try to be the ecutives who, with no connection to while London and New York had best, others will replace us in a Brazilian companies, decided to already been through this process”. matter of seconds”. risk their professional future Upon arriving, she worked at two The number of visas in the largest of the so-called architecture firms, before opening n

granted by the Chinese Em- BRIC countries. her own company six months lat- o ti c bassy in Brazil gives an idea of That’s what happened er, Tais Cabral Interiors. She cur- e oll C

the growing interest that the with the architect Tais Ca- rently spends her time working as l na

country has been arousing bral (33, São Paulo), who an interior designer for the grow- o s

ut r e o

in Brazilians. In 2010 alone, has been in Shanghai for ing Chinese middle class, as well as : P es 41,600 visas were granted Hand four years. “The opportu- helping in projects of foreign clients r tu c i for travel, business or work nities in China are enor- (including Brazilians) who come to P

1 2

32 P I B 1 Giovanna: 2 Stephanie: hunting in search of industry trends suppliers

China. The thriving Speaking fluent 3 Taís, at the 4 Kevin: She recently Chinese economy mandarin, the main showroom she multicultural helped a married language, is still a helped design: roots facilitate couple of Rio Grande can jumpstart major challenge. Oriental customs business do Sul businessmen careers in Fortunately, howev- to put a show room a matter of er, although Shang- together to promote hai or Peking are Brazilian brands in months still nowhere near Shanghai (see table as internationalized on page 34). “In as their Hong Kong, travel from Brazil to China. Born in China people want everything to be Singapore or Bangkok neighbors, New York, raised in Rio de Janeiro, done yesterday”, she states. “Proj- you can get by speaking English. son of a Chinese father and German ects that would normally take six The growing legion of foreigners mother, Kevin has a degree in eco- months in Brazil and ten in Paris in the major Chinese cities makes nomics and international relations are done in two months in China”, English a safety net for those with a from the University of Cornell and, she says. In all these years, Tais says poor grasp of mandarin. But things for 3 years, has run Transnational she has already incorporated some should change: “You will now see Resources, a company dedicated to Oriental habits. “I drink tea all day more and more foreigners speaking selling Chinese products to Brazil. despite the scalding heat, I’m always fluent mandarin on the streets”, says He spends four months of the having massages and I am addicted Tais, who speaks just enough to grab year in China – mainly in Shang- to Chinese food”, she says. “But I a cab or go shopping. hai – and splits the rest of his time have also acquired the horrible habit The businessman Kevin Tang between Rio and São Paulo, selling of shouting when I speak.” (29) uses his multicultural roots to machines, steel, building supplies,

3 4

P I B 33 Career 1 Antônio and 2 Ponce: after taking Tânia: winning his master´s in over the Chinese France, he now works market in ‘crisis-free’ China

people we are working for”. Brazilian Gate features products targeted at this group of highly demanding consumers, who want uncontestable quality and objects with personality. “Our products have a ‘touch’ of Brazil – and that’s what sells”, says Antônio. Exporters already present at Brazilian Trends include companies such as Mormaii, Pelu, Dado Bier and Solarium. And while the products remain on display in the main showroom of the store, Shanghai Trends (a consultancy responsible ut o for the space, which also belongs

Hand to the couple) goes out looking 1 for partners (distributors, store A DOOR FOR BRAZIL owners, licensees, franchisees or financial investors) for the companies Created a few months ago, in Hong Kou, one of the most whose products are on display. the Brazilian Gate company started charming districts of the city, in “We took everything we had out in Shanghai with the aim of an entertainment complex called and went to China to understand facilitating the entry of Brazilian 1933. As with the urbanistic re- the local market and also help products into the Chinese market. birth of the Meat Packing District, Brazilian companies come to China The idea is to enable Brazilian com- in New York, the warehouses and as well”, explains Antônio, who panies to test the acceptance of factories of the old industrial dis- says that China’s role as the world’s their products by Chinese consum- trict of Shanghai are being adapted producer is progressively diminish- ers before upping their investments to receive sophisticated stores, ing, with the country now becoming in the country. Brazilian Gate, run advertising studios, art galleries the world’s main consumer market. by the married couple Antônio and restaurants. In other words, it is now being seen João Freire and Tânia Caleffi (from “Our focus is the Chinese up- as a buyer and not a competitor. Rio Grande do Sul), functions as a per class: we’re talking about 150 “Everyone is here, except Brazil”, showroom. The space, projected million nouveaux riche, almost the he complains. “Unfortunately, by the architect Tais Cabral, was whole of Brazil”, says Antônio. “Of Brazilian businessmen remain very inaugurated in August 2010. this total, 13 million earn upwards inward-looking and still have a hard The location was handpicked: of US$1mn a year. These are the time expanding their horizons.”

2 apparel and accessories. Kevin be- Indeed, business prospects between lieves China has become an “im- the two countries are more than portant/vital” partner for Brazil- promising. For this group of Brazil- ian companies and professionals ians who decided to travel half the n

o with an international vision. “You way around the world to actively ti c e simply cannot afford to not do busi- participate in the extraordinary oll C ness with the largest trade partner transformation currently underway l na

o of Brazil, with over US$50bn in bi- in China, their bold decision prom- s r e

P lateral trade flows in 2010”, he says. ises rich rewards.

34 P I B

Article

Next stop, the European Union?

Europe only trails Latin America as a receiver of greenfield investments by Brazilian multinationals Feder ic a Mi a zzi*

ountries all over the vestments in developed economies ian subsidiaries as a result of Green- world are looking to like the European Union? field investment made by 74 Brazil- attract new foreign di- fDiMarket, a cross border invest- ian-owned companies in European rect investments (also ment monitor, registered a total of Union countries. It is very difficult known as Greenfield 455 Brazilian Greenfield projects to trace back and track this type of CFDI). We are talking about an im- abroad between 2003 and 2010. FDI as there are no public statistics portant source of job and wealth This type of investment almost dou- showing a breakdown by companies, creation, which is leading national bled between 2007 and 2008. The implying that this number could ac- and regional governments to set up European Union has been so far the tually be bigger. Below I show some specific organizations, the inward second most relevant macro-region of the findings of my research: investment promotion agencies, to destination (69 projects), after its promote their territories, highlight- Latin American neighbours (198 ing business opportunities and pro- projects), in terms of number of new What type of Brazilian company viding information on how to set up direct investment projects received is setting up shop in the European a company in their countries. Bra- from Brazil since 2003. Union? zil’s economic growth has aroused In the 1970s, several Brazilian Most of them are also present in the interest of these organizations companies started to establish a another macro-region (38% in Lat- around the world. In a time when presence in foreign markets and in America; 24% in North America; emerging markets like Brazil are particularly in Europe (i.e. Banco 16% in Asia; 8% in the Middle East playing a greater role in the recov- do Brasil). A research study I per- and 6% in Africa), they are usually ery from the global financial crisis, formed in 2009-10, as a Master’s large firms (although medium and the question arises: how important student at the University of Bologna, small firms are increasingly expand- is Brazil as a source of new direct in- tracked the presence of 124 Brazil- ing) and originally hail

36 P I B Natura in Paris: Brazilian cosmetics are now enjoying their day in the sun

companies to seek international experience abroad in order to remain competitive on the domestic front. The key drivers of the international expansion of Brazilian companies include the need to improve their market access, the potential to increase sales internationally, the saturation of the domestic market [Fundação Dom Cabral Ranking for Brazilian Transnational Firms in 2009], the desire to acquire com- plementary skills, R&D expertise, global branding and new business models [BGC New Global Challeng- ers Report, 2008].

And why did they choose the Euro- pean Union? Brazilian investors indicate as key factors for establishing a physical presence in the European as r Union the historical links with its ei rr

a countries, and the cultural prox- P ia

B imity with clients from this large unified market.

from the Southeastern/South- lands and Belgium. Eastern Euro- And finally, what still needs to be ern States of São Paulo, Rio de Janei- pean countries recently joining the done to strengthen this presence? ro, Santa Catarina, Rio Grande do European Union are also increas- There is an increasing competi- Sul and Paraná. The predominant ingly attracting Brazilian compa- tion to attract direct investments industries are the Financial Servic- nies and mainly for manufacturing in the global arena. The expansion es, Information & Communication facilities. abroad by Brazilian companies is Technologies and Business Services, a recent phenomenon that has to but also Automotive, Food & Drinks, Why have Brazilian companies be stimulated both internally and Chemicals and Electrical Equip- gone abroad? externally. In fact, from the Brazil- ments. New upcoming industries The gradual opening of the Bra- ian perspective, local small- and in this phase of internationaliza- zilian economy since the 1990s and medium-sized innovative compa- tion are Fashion, Medical, Cosmetic the exporting boom started in 2002 nies need easier ways to finance industries and the Communication allowed some Brazilian companies their expansion abroad. But also services. to grow, providing them with ad- from the other side, the European ditional resources to invest abroad. Union needs to deepen bilateral re- And where do these companies At the same time the increased lations with Brazil and Mercosur establish a presence in the EU? competition posed by international and better coordinate the process The EU countries which are players entering the domestic Bra- of promoting business opportuni- home to the highest number of Bra- zilian market has driven Brazilian ties in the region. zilian-owned subsidiaries are also Brazil’s main EU trading partners: Portugal, Spain, France, United * Federica Miazzi is Italian and works at Think London, the foreign direct investment Kingdom, Italy, Germany, Nether- agency for London, where she helps Brazilian companies set up shop in the British capital

P I B 37 COFFEE

The coffee lesson TANIA MENAI, NEW YORK Exports

1 Warming up with a cup São Paulo women open a U.S. niche market for Brazilian specialty coffees Tani a Men a i, New York

38 P I B 1 Maria 2 Coffee Fernanda at shop the counter storefront: of Gimme a winter Coffee in NY refuge

appreciate coffee”, says Maria Fer- American and moved to Brooklyn. nanda Mazzuco (São Paulo), a cof- In her suitcase, she took the con- fee specialist who has been living tacts she had made with US coffee in New York for the last five years. roasters who visited Brazil. “Up un- “They learn how to distinguish good til 2000, Brazilians didn’t even talk coffee from bad coffee and are will- of specialty coffees; the mantra was ing to pay more for the good stuff”, ‘what’s good goes abroad, what’s bad she says. stays in the country”, recalls Maria Maria Fernanda knows what she Fernanda, who also founded the is talking about: via her company Brazilian Coffee and Barista Asso- JoyBrazil, she supplies made in Bra- ciation. “However, the Italian brand zil coffee to Gimme Coffee and vari- Illy entered Brazil, bringing with ous other coffee shops and brands it the story of Italian coffee and on the US East Coast. With one espressos; and restaurants started detail: all these shops and brands charging for coffee. Previously, a are environmentally and socially post-meal cup of coffee was free”. responsible. As a result, they reach a Maria Fernanda recalls that specific and growing market niche. 70% of Illy coffee was Brazilian – it JoyBrazil was cre- left the country, was ated back in January roasted in Italy and 2008, from a partner- The best returned to Brazil. ship between Maria beans arrive By observing the Illy Fernanda and Eliane at gourmet process from the box Sobral (also from São seats, Brazilian cof- Paulo), who has been cafés on the fee producers real- living in New York East Coast ized that they could for the past 25 years. also create their 2 of the U.S. The success of the brands in Brazil and brand is equivalent started to offer cer- ight falls at 4:30pm in to a perfect cappuccino: the blend tified coffees as “specialties”: in Manhattan. We are of business and coffee expertise other words, produced with social in the charming Mott that each partner brought to the and environmental responsibility. Street, in NoLIta (the business. Eliane spent years work- The JoyBrazil duo is targeting this North end of Little ing in the US corporate world. She gourmet public niche that also plac- NItaly, next to SoHo). The thermom- procured apparel for large chains es value on coffee produced without eter plummets to a few degrees be- such as Levi’s, Victoria’s Secret and exploring workers and harming the low zero and the situation urgently Ann Taylor. She traveled the world environment. They work directly calls for a cup of coffee. We’re in (Turkey, India, Vietnam, China) but with Brazilian producers in São luck. Here is Gimme Coffee, a cozy never bought from Brazilian suppli- Paulo, Rio de Janeiro and Minas little coffee shop that, in addition ers (since they usually failed to meet Gerais. One of them, in the moun- a

lv to roasting its own coffee brand, the delivery deadlines!). Maria Fer- tain region of Rio de Janeiro, is the i S

da also promotes coffee planted in nanda worked in São Paulo as mar- São João Farm, owned by Sérgio So- r N.

i sustainable fashion. And what’s keting director of Astro Café, one bral. The state of São Paulo is home

: Alc more: it imports coffee from Bra- of the first brands certified by the to the Paineiras Farm (of the Baggio es r zil. “Americans are becoming more Brazilian Association of Specialty family) in Mogiana Paulista, whose tu c i P knowledgeable and learning how to Coffees. In 2005, she married an coffee plantation is overseen by Li-

P I B 39 Exports

ana Baggio Ometto, and the Santa In order for coffee to receive the Terezinha Farm (owned by Cesar seal of sustainability, the following Ometto). In Minas Gerais, Joy Bra- factors are considered: what the zil works with the Pindaíba Farm coffee farms do for their employees, (also owned by the Baggio family) from offering schooling and crèches in the Cerrado region. to employees’ children, to projects The farms were handpicked, vis- to ensure that workers’ wives have ited by Maria Fernanda and Eliane, other activities (such as knitting, and comply with the prerequisites sewing or painting) when they are for the rigorous cer- not busy harvesting. tification processes There are initiatives of the RainForest Specialty such as a library for Alliance and UTZ coffee makers children, uniforms Certified organiza- for harvesters and tions (see box on next must prove the guarantee of page). The sacks are products are a basic basket of sent by ship to a port sustainably household necessi- in the state of Virginia, ties; all of this creates where they are stored produced a socially responsible in a specialized ware- community. On the house. JoyBrazil has an employee environmental front, producers based in Virginia who receives or- are required to replant native and ders from small US coffee roasters in original trees – under Brazilian New York, Massachusetts, Michigan, laws, 20% of a farm must be covered North Carolina, Minnesota, Texas by natural forest. It is prohibited to and even the Canadian city of To- totally deforest a territory in order ut ronto. Some JoyBrazil clients roast to use it for crops. “Planting trees o Hand

the coffee to sell it under different around a coffee plantation means : es brands, while others, such as Gimme less agro-toxins are required”, ex- r tu c i

Coffee, use it in their own brands. plains Maria Fernanda. “The trees P 1

40 P I B 1 Coffee plant and the São João farmhouse: special beans

serve as natural protection – the birds that migrate to the region A valuable seal end up protecting the coffee plant, because they eat the insects that The basic guide for certifying damage the plantation”. But the sustainable production process doesn’t stop there: the coffee is washed after being harvested. In order for a coffee farm The water is clean, since it comes to obtain the approval of UTZ straight from the spring. And after Certified (an organization based the coffee beans are washed, the in Holland that certifies the good water is filtered to irrigate a second practices of coffee, tea and cocoa plantation, such as an orange plan- producers), it needs to comply tation, for example. In some cases, it with the following requirements: takes three years for a coffee farm General precautions to become environmentally cor- The farms use water and rect: the investment is high and this, • energy with the least envi- obviously, is passed through to the ronmental impact. Farmers price of coffee, which is reflected protect water springs and use in an additional cost of around 30%. sustainable energy wherever But people who appreciate these possible. initiatives are willing to pay the Responsible use of agrochem- extra price for a good espresso. • icals. Fertilizer and pesticide “The US population that buys use is kept to a minimum, and coffee in supermarkets is more fa- they are stored in safe places. miliar with Colombian coffee, due Workers wear uniforms that to its massive marketing campaign”, protect them from the harm- says the consultant Sherri Johns, ful effects of these products. owner of WholeCup Coffee Con- • Farmers use native trees to

XXXX sulting (from Oregon), which has keep the coffee plantation in already provided services to com- the shade, and seek to reduce panies such as Starbucks and is au- and prevent soil erosion. thor of the Coffee Café recipe book. Workers should be trained in “At the same time, coffee consumers • health and safety procedures are becoming increasingly sophisti- in the event of emergencies cated, learning what pleases them and when using pesticides. and what doesn’t, and discovering Producers monitor in writ- a wide variety of flavors”, she says. • ing the use of pesticides and “Most of them know that Brazil is a chemicals, which is checked coffee producer, but not necessarily annually. that it is the best”. The coffee is roasted in Sherri recalls that US coffee • machines that expose it to roasters are familiar with Brazil for extreme heat. its “blend” coffee, used in a mix- Cargo transport should ture with another variety, which • separate the green coffee will give the beverage its final taste. beans from the other sacks of Brazilian coffee has been promoted roasted coffee. Its packaging in the US in the last 10 years. But a should identify it as green cof- good coffee isn’t born on trees, she fee, so that it receives special jokes. “It requires a rigorous pro- care during long hauls. cess that starts at the coffee farm

P I B 41 Exports

1 1

and ends with teaching barmen on has quality coffee, notes Maria Fer- zil is the world’s largest producer the coffee they are serving”, she nanda, recalling that Seattle was of green coffee beans and a major notes. “One of the best Brazilian home to the birth of Starbucks, a exporter of certified coffee, while initiatives is the Cup of Excellence, hugely successful franchise in the the US is the world’s biggest buyer a competition between coffee pro- US. “The New York culture is cof- of Brazilian green coffee beans ac- ducers organized by the Alliance for fee in mugs, a habit inherited from cording to Nathan Herszkowicz, Coffee Excellence (ACE) – and or- the Dutch”, she recalls. “Five years executive director of the Brazilian ganized in Brazil by ago, when I moved to Coffee Industry Association (ABIC), the Brazilian Special- New York, it was dif- based in Rio de Janeiro. The 2010 ty Coffee Association ‘The ficult to find a qual- Brazilian coffee harvest totaled 48 – in which 25 judges entrepreneurs’ ity espresso”. Now, million sacks, while Vietnam (the taste the products. goal is to export several places are 2nd largest producer) harvested 18 Brazil was a pioneer “popping up”, mainly million, and Colombia produced 8.7 and today 9 countries 10,000 coffee in the districts of million sacks. already promote this sacks per year young adults such Production continues growing competition”. to the U.S. as Williamsburg and in Brazil, with the 2010 coffee har- Maria Fernanda Park Slope, in Brook- vest representing an all-time high, and Eliana currently lyn, and East Village, according to Herszkowicz. He says import to the US one thousand 60kg West Village, NoLIta and SoHo, in the US is the biggest buyer of Bra- sacks per year, and the aim is to in- Manhattan. “The new generation zilian green coffee beans. “In 2010, crease this to 10,000 sacks. 1.5kg of is already more knowledgeable on the US likely acquired around 5.5 certified coffee costs US$2.95 and coffee and, thus, more demanding”, million sacks of Brazilian coffee, ut

Maria’s and Eliana’s intention was, she notes. equivalent to 25% of overall US an- o

from the outset, to cover the US As a producer and consumer nual coffee consumption”, forecasts Hand : es East Coast. The West Coast (Seattle, market, Brazil and the US seem Herszkowicz. This number also in- r tu c i

Los Angeles, San Francisco) already like a match made in heaven. Bra- cludes instant coffee and ground P

42 P I B 1 Worker at the São João coffee plantation: social and environmental sustainability

and roasted coffee (the latter in still brand, and successfully presented isn’t pleasing, the consumer feels very small volumes). The US is the itself to Americans as the country he has been short-changed. “Know largest global consumer of roasted of coffee. Brazil, on the contrary, your roaster, your producer and the coffee, at 20 million sacks per year: is more present in other brands. farm where your coffee comes from. 57% of the US population aged +18 Herszkowicz says this is because And then, and only then, start to ap- consumes coffee on a daily basis. Brazilians only started exporting preciate it”, she advises. In a broader scenario, Brazilian processed coffee recently. “But the non-organic roasted raw material of all coffee is starting to the major US coffee hit the shelves of US Producers brands is 25% Brazil- CARE WITH WORKERS super/hypermar- aim to build ian”, he stresses. “We On a sustainable plantation... ket chains, such as are in the package”. All children have access to WalMart, HEB and the Brazilian Herzkowicz believes • education Publix. According to coffee brand, that Brazilian coffee • Workers and their families Herszkowicz, most of following will continue expand- have access to decent living the coffee that Brazil ing its share of global conditions, drinking water and exports is green Ara- Colombia’s lead consumption. “We medical services. bica beans, including currently account Workers and cooperatives are specialty coffees – which are the for 32% of annual global exports, • protected by national labor rarest, most exclusive and highest but we will increase this to 35% in laws, in accordance with the grade. Brazil, however, still lacks a the next five years”, he concludes. International Conventions stronger brand in this market. The But to get there, sustainable coffee of Labor Laws, including age most frequently quoted example is isn’t enough warns the consultant and working hour limits, always Colombia, whose govern- Sherri Johns, who is familiar with working conditions, safety ment supported the creation of the JoyBrazil’s work of promoting Bra- and wage increases. “Juan Valdez – Café de Colombia” zilian coffee in the US; if the taste

P I B 43 44 Thomas Shannon Ambassador Interview P IB

Antônio Serralvo Neto/handout american embassy Partnership for the world

The Ambassador says that the U.S. recognizes the growing global role of Brazil and seeks to make room for the country to act on the world stage Nely C a i xeta

or the Ambassador of years,” says Shannon, during an States, Barack Obama to Brazil – his the United States in Bra- interview granted in the midst of first since he was elected in 2008. zil, Thomas Shannon, it hectic preparations for the recent The Ambassador believes that the is more than time to es- visit of the President of the United U.S. and Brazil have the opportunity tablish a new paradigm to create a partnership not only im- Fof political cooperation between portant for both countries, but one Brazil and the U.S. From his pers- The U.S. and with value that goes beyond bilate- pective, the international scenario ral relations. Shannon is an impor- allows both countries to now put Brazil took first tant part of this diplomatic puzzle. aside a short-term view, one that is steps towards A year in office and speaking fluent merely “transactional” and to build an interesting Portuguese – he already served in a long-term strategic relationship. Brazil throughout his career - the “We have to see what kind of rela- partnership. We former undersecretary of state for tionship we want in ten, 20 or 30 must take others the Western Hemisphere has focu-

P I B 45 Interview • Ambassador Thomas Shannon

sed on getting the U.S. government What prospects do you see for rela- The U.S., Japan, and Brazil (with to recognize the new position of tions between Brazil and the United Embrapa) are partners in an agri- Brazil in the world and to treat it Sates in the post-financial-crisis cultural development project in an equal. He spoke to PIB about world stage? the Nacala corridor, in Mozambi- the challenges for both countries President Obama’s visit is a trip for que. The goal is to incorporate a to transform rhetoric into reality. a 21st century partnership, an op- new food production area in the sa- portunity for Brazil and the U.S. to vannas, similar to what took place This is a time of demonstrations in articulate a vision of partnership in the Brazilian Cerrado (savanna). the Middle East which have even not only in bilateral relations, but What else is on the table? reached Saudi Arabia, a major U.S. in the way the two largest demo- We have interesting projects in partner. What might the result be? cracies in the Americas approach the areas of biofuels, public heal- What the world is experiencing the world. We’ve discussed the th, democratic governance, and in in the Middle East is a moment role that the two countries can the areas of agriculture and food of popular expression within re- play in the world to benefit our ci- security. Some are more develo- gimes where people had little say tizens, Americans and Brazilians, ped than others. The joining of and little space for a long time. I as well as the idea that we have so- our experiences and capabilities am not going to predict anything mething to offer in different areas. has special value for some develo- about specific countries. But ping countries. In the fight against Secretary Hillary Clinton, in a transnational crime, Brazil today speech in Cairo, recently spoke is strengthening its capacity to about the need for an opening up combat drugs and weapons tra- of politics to make room for the fficking originating in neighbo- people. Obviously this is a track ring South American countries. that the countries of this region The challenge The model of cooperation in this must follow. for the two fight is changing. Brazil, especially countries now through the Federal Police, can A track of opening up? be a important partner, working Yes. In Egypt, there is a long his- is to transform to enhance technical capacity in tory of a closed regime and an at- goodwill countries that need help in com- tempt by society to express itself into reality bating this type of crime. at different times and through different channels or media. In Brazil there is sugar cane ethanol. The U.S. has corn-based ethanol. In 1979, the fall of the Shah of Iran Instead of one industry opposing aroused enthusiasm that soon tur- In this new 21st century rela- the other, wouldn’t it be better to ned into apprehension of the funda- tionship, in what areas can the U.S. show the world a common option mentalist regime of the Ayatollah and Brazil make a difference? for clean energy? Khomeini. You are not concerned There are many areas. The major This is what we are doing. The about things going the wrong way challenges of this century, such as understanding about fuel has this in the Middle East? food security, energy security, the vision of working together to build That possibility always exists, but battle against transnational crimes, a global biofuels market. And also we should not fear the new. Each drug trafficking, mass destruction to create rules, exchange expe- society will find its own way to and the fight against poverty and riences, and help other countries structure or channel this new “ac- inequality, are all struggles that establish their own industry. This tor” in national politics. I think de- require agreement and coordina- shows the commitment of the U.S. mocracies like the U.S. and Brazil tion between countries. The U.S. and Brazil to renewable energy. must respect other countries and and Brazil have already taken the But in the future, this tension be- act with caution. Therefore, we first steps to build an interesting tween sugarcane and corn will be must also articulate our values of partnership. We have to take other seen as just a step in developing democracy and human rights. steps to deepen it. third-generation biofuels. To re-

46 P I B

ally be a worldwide product, it U.N. Security Council? ther internationally, constructing cannot only be of cane or of corn. Brazil’s ambitions are legitimate, the United Nations, fighting toge- More diversified primary resour- and we respect this. We have the ther in World War II. Recently, it ces are needed, and Brazilians and same political values of demo- was the U.S. that opened the do- Americans are working together cracy, human rights, of an open ors to Brazil in the G-20, so that to identify other raw materials. society, of actions taking place in a Brazil had a leadership role, and This is the future. peaceful manner. A debate within acted within the International the UN needs to move forward in Monetary Fund to expand Brazil’s Other more advanced technologies order to identify how to promote role there. It is possible to indicate cannot be anticipated? these Security Council renova- several times that the U.S. recog- The future of renewable clean tions. Obviously the Council nee- nized the growing role of Brazil in energy will come from different ds to reflect changes occurring in the world and acted to make space sources, be they hydroelectric, the world. Right now, it’s a “Po- for it. Climate change would be a wind, solar, or biofuels. laroid” snapshot of the old world. good example - the way we colla- Maybe we need a digital photo. borated in Copenhagen, the way The U.S. Congress does not seem to we collaborated in Cancun and have the same vision... When Brazil adopts a position that our own understanding of climate The Executive and Congress are diverges from American foreign change, all this shows a clear re- working in a responsible manner cognition by the United States of to build a consensus about the the important role of Brazil. future of energy, so that we can identify an energy policy that is Even with eventual differences in intelligent and long lasting. Obama’s vision? There are, of course, differences How do you evaluate the govern- visit is a very between the U.S. and Brazil, but ment of Dilma Rousseff in relation important this is to be expected between to the previous government? moment nations. Our president and our We began well, from the talks secretary of state have a good between President Obama and for history, understanding of the transforma- the president-elect in Washington, for the future tions that are occurring here and to Secretary Hillary Clinton’s visit abroad, and consider it important with the administration, and now for us to give more room to Bra- with the president coming. There zil. There are different ways of is a very active agenda, with many viewing our relationship. Some opportunities. But it is important policy, it still bothers the U.S. For wish to see this relationship in to remember that this process of example, it was the impression transactional terms only. In some transformation had its beginning that Brazil, when it diverged from circumstances this has value, but during the eight years of the Lula the U.S. position in the case of Iran, we are countries with friendly Presidency. Our idea is to streng- was treated differently from Ger- relations, without great clashes then what we achieved in this many and other European countries or conflicts, with a situation that relationship, and advance and that had taken a stance against the now lets us be less transactional, deepen it in the new government. intervention in Iraq. Is this in fact less tactical, and more strategic. We detect Brazilian goodwill and the case, or is it a certain “inferio- We have to see what kind of re- interest. The challenge of the two rity complex?” lationship we want in ten, 20 or countries at this moment is to turn I think that this “inferiority com- 30 years. We must outline our di- goodwill into factual reality. plex” is simply mistaken. There plomacy and our relationship to are historical facts, that is, since achieve this goal. So Obama’s visit What can be expected from the the beginning of the Republic of is a moment of great importance Obama goverment in relation to Brazil, the U.S. and Brazil have had for the history of Brazil and the Brazil’s goal of having a seat on the important times of working toge- U.S., and for the future.

P I B 47 Cover Chinese at INPE: five satellites in the partnership

In the networks of knowledge Just like companies, Brazilian science is also becoming increasingly global Antonio C arlos Santom auro, São Paulo

t the end of the 1980s, generation of scientific knowledge in scientific research and also its when the current and in technological research and relative share in global science and emerging markets of development (R&D) activities. research output (while the share of the 21st century were The Brazilian-Chinese partner- rich countries is declining). In the still peripheral play- ship also shows that, just like the period 2002-2007, China increased ersA on the global scene, Brazil and increasingly globalized economy, its share (measured by the percent- China started discussing the joint knowledge is also crossing bound- age of its gross domestic spending development of terrestrial obser- aries and starting to be created via on R&D in relation to the global to- vation satellites. A global-scale ventures. tal) in global R&D investment from little more than two The newfound im- 5% to 8.9%. decades later, this Emerging portance of scientific In the opinion of Unesco, emerg- discreet partnership markets now research carried out ing markets “are creating a more has already launched have a bigger by emerging markets competitive global environment, three satellites, and was shown in a study developing their potential in the by 2015 it will put an- say in global published at the end spheres of industry, science and other two into space. scientific of last year by Unesco technology”. The measure used in In this period, the two production (UN organization for the work of Unesco (referred to countries have also education, science as GERD) considers all state and become much bigger and culture). The private-sector spending on R&D in players in the global economy. And study mapped the evolution of sci- a country. Brazil has shown more their growth has brought with it ence around the world and showed modest progress in this analysis — another relevant change: China and that China, for example, has dra- the share of Brazilian GERD rose Brazil are also investing more in the matically upped its gross investment from 1.6% to 1.8% of the overall

48 P I B UT O AND H INPE/ global total in the same period — but gross spending rose almost 50% be- Global presence tween 2004 and 2008 (see table on this page). And thanks to partner- In 1990, over 95% of global The number of Brazilian ships such as the one with China • research and development was • researchers per million inhabit- in the airspace sector, Brazil is now carried out in developed coun- ants rose from 401, in 2000, to less of a provincial country, giving tries. In 2007, this percentage 657 in 2007 it the chance to strengthen its pres- had fallen to 76%. ence among the countries involved in science and technology creation Between 1997 and 2007, the GROSS DOMESTIC SPENDING and to solidify its inclusion and par- • number of Brazilian articles ON r&D IN BraZil ticipation in international R&D net- featured in international sci- (US$bn) works. Among other recent initia- entific publications more than 22.4 23 tives, Brazilians are starting to work doubled, totaling 19,000 per 19.4 year – more than Holland and 17.4 in partnership with leading Europe- 15.5 an physics and astronomic research Switzerland. centers – from the infinitely big to the infinitely small. Brazil’s participation in inter- At the end of 2010, Brazil became • national scientific publications the first non-European signatory of rose from 1.7%, in 2002, to 2004 2005 2006 2007 2008 ESO (European Organization of As- 2.7% in 2008. Source: 2010 Unesco Report on Science, tronomic Research in the Northern Executive Summary Hemisphere), originally formed by

P I B 49 Cover

14 European countries. ESO has several state-of-the-art telescopes in the Chilean Andes, where it carries out state-of-the-art astronomic observations are performed (the polluted air and bright lights of cities affect the performance of optical telescopes, explaining the remote location of the European observatory). And Brazil has also put its name in the hat for a seat on CERN (European Nuclear Research Center) in Geneva — which is currently the main global center of atomic particle physics. Hundreds of Brazilian scientists and engineers are already working at CERN, either on their own or in joint projects of national universities and research centers. Still awaiting approval by Con- gress, becoming an ESO signatory requires investments of R$700mn in 10 years; to participate in CERN, Brazil will spend R$25mn a year (see box below). The cooperation

Costs and benefits student from Pakistan”, says Luiz conditions for the Brazilian Cen- Agostinho Ferreira, a researcher ter to join CERN. He believes the At the São Carlos Physics from IFSC-USP who is studying benefits for Brazil go way beyond Institute of the University of São electromagnetic waves (and who just research laboratories. “CERN Paulo (IFSC-USP), in the interior of also studies at British universities). works in partnership with industries, São Paulo state, Brazilian scientists Will Brazil’s investment in these holds bidding processes and orders work alongside colleagues from scientific partnerships yield results? prototypes”, he says. “If Brazil be- England, Japan, Spain and the US in “I do not know of any country that comes a member of CERN, Brazilian the study of electromagnetic waves became poorer because it invested advanced technology companies that propagate without dissipating in research, but I do know of some will be able to take part in these bid- energy. Other groups in the areas countries that became poorer after ding processes”. of optics, semiconductors and they cut investments in research”, Other scientists are more biophysics also have international argues Ronald Cintra Shellard, skeptical. Augusto Daminelli, partnerships, which is already at- vice-director of the Brazilian Physics professor of astronomy at the tracting the attention of foreigners Research Center. Shellard headed Institute of Astronomy, Geophys- keen to work in Brazil. “We have the Brazilian team that discussed ics and Atmospheric Science of been contacted by a PhD student with CERN (European Nuclear the University of São Paulo (IAG/ from England and a university Research Council) the terms and USP), criticizes Brazil’s decision to

50 P I B 1 European 2 ...and particle telescope in accelerator in the Andes... Switzerland: Brazil has joined up

of Brazilian researchers with their European colleagues at the two organizations will help boost Brazil’s status in terms of international scientific collaboration. Today, at least a third (30% to be more precise) of Brazilian research has excelled glob- academic articles published by Bra- ally, ever since the country started to zilians feature the collaboration of leverage on the natural advantages researchers from other countries. that it has always had (abundant In the UK, this percentage is 41%, earth, sun, water and biodiversity) notes Carlos Henrique de Brito together with sustained and well- Cruz, scientific director at Fapesp channeled efforts on the educational (São Paulo State Research Support and intellectual fronts. Foundation), and coordinator of the An example of the increased in- Brazilian chapter of the aforemen- ternational interest in Brazil as a re- tioned Unesco study. But Mr. Brito search partner is the creation in Bra- Cruz believes now is a good time zil, at the start of 2010, of an office of to climb a few rungs on the ladder: CNRS (Centre National de La Recher- “Scientific research in Brazil has che Scientifique), France’s leading already reached a level that facili- state-run research institution with tates international partnerships, and an annual budget of 3.4bn Euros. It there are a lot of people from other is a two-way effort, says Jean Pierre O

/ES countries interested in partnerships Briot, director of the Rio de Janeiro- ina c in areas such as bioenergy and ag- based office. As well as identifying n Bo

k riculture”. It is no coincidence that opportunities for joint efforts, it o zt I these are two of the areas in which will also give France a much better 1 N R E join the European Organization for C Astronomical Research in the Southern Hemisphere (ESO). “As far as Brazil is concerned, there was no technical analysis of the benefits of this investment”, says Daminelli. He believes the cost/benefit tradeoff would be better Xx xx xx x x xx for Brazil if, despite spending only 10% xx xxx xxxx of the admission cost, it were to invest xxx xxx xx xxx more in its current projects to use the telescopes of several observatories (in- xx xxx xxx cluding some of ESO’s own telescopes). xxx xx xxx Albert Bruch, director of the National x xx xxx xx Astrophysics Laboratory, disagrees. “In order to continue evolving, Brazil- ian astronomy needs access to the new generation giant telescopes”, he argues. “ESO has them”. 2

P I B 51 Cover a orrê C o d r a c Ri 1 2

idea of the Brazilian reality: “It will In the view of Thelma Krug, head Amazônia 1, the satellite should be show that Brazil also has first-class of international relations at INPE launched in 2013 or 2014. The pro- researchers, institutions and re- (National Space Research Institute gram has also enabled Brazilians to search structures”, he says. Among – and the institution coordinating establish a partnership with Argen- the projects developed together Brazil’s participation in the pro- tina for the joint construction of an by Brazil and France with the par- gram) in the São Paulo city of São ocean monitoring satellite, slated ticipation of CNRS, Briot mentions José dos Campos, it was an align- for launch in 2016. “The private- joint laboratories for studying mag- ment of factors that led to the part- sector airspace industry has also netism, immunol- nership being creat- come on in leaps and bounds since ogy and mathematics. ed. China has similar the agreement with China, and Bra- The two countries Brazil-China needs to Brazil – they zilian companies are already being are also structuring technological are both countries sought after for projects in other the French-Brazilian partnership with vast territories, countries”, says Thelma. An exam- Center of Amazon where satellites are ple of a highly-qualified Brazilian Biodiversity Stud- will launch key observational company is Orbital (also from São ies (the territory of five satellites tools. China also José dos Campos), an airspace en- French Guyana, on by 2015 already had a well- gineering company that produces the North border of structured space solar panels for generating the en- Brazil, is home to a program in place and ergy of the third Chinese-Brazilian piece of the Amazon rainforest). was willing to transfer technology satellite (CBERS 3), and which also If the partnership with France is and share costs. provides services in Canada. more in keeping with the traditional Known as CBERS (Chinese- All these ramifications serve to model of associations generally led Brazilian Earth Resource Studies), remind us that, in the economy of by more developed nations, the the joint program built satellites to knowledge, a well-watered seed space consortium with China is an capture key information for Brazil, usually multiplies its fruits. The example (unfortunately a still rare such as data on the deforestation of very existence of companies such example) of a partnership between the Amazon rainforest. And in terms as Orbital in São José dos Campos two emerging nations. So, what led of absorbing technology, it appears is due to the birth and creation in Brazil and China to enter into this to have already qualified Brazil to this same city (located in the inte- partnership all those years ago? develop its own satellite: called rior of São Paulo) of a technological

52 P I B 1 Chinese 2 Braskem 3 Campinas researcher: research CTBE: in Embraco center: green the race for in Peking plastic cellulosic ethanol

sustainable management of arable land. When choosing where to install a virtual laboratory, Embrapa pri- oritizes countries that dominate strategically important knowledge, according to Nass: this includes areas such as advanced biology, climate changes, animal sanitation and food safety. But even in a specialty in which Brazil is dominant, such as UT

O biofuels, Brazilian researchers feel AND insky

H the need to establish international v / Le partnerships. This concern is well- lo asken ab P Br founded: while cutting-edge studies 3 in several countries currently favor the development of second genera- and industrial center run by insti- research into tropical agribusiness. tion ethanol (or cellulosic ethanol), tutions such as ITA (Technological Embrapa established a pres- capable of also using the bagasse Institute of Aeronautics) and INPE ence in the international networks and straw from sugarcane (or other itself. ITA was the place of study of of knowledge of its area via “vir- plants) to produce biofuel, Brazil the engineers who would later go tual labs”, so called since they en- still basically works with first gen- on to create most of the companies able Brazilian scientists to work at eration ethanol, obtained from pro- that now form the Brazilian airspace the facilities of similar institutions cessing the sugarcane juice. industry chain, of which the leading abroad. At its International Virtual CTBE (National Bioethanol Sci- proponent is Embraer – one of the Labs (called Labex), ence and Technology world’s main commercial aircraft Embrapa research- Laboratory), which manufacturers. ers now share expe- Embrapa has been operat- One of the reasons for the riences and resourc- has “virtual ing less than a year growth of scientific research activ- es with colleagues laboratories” in Campinas (São ity in Brazil (highlighted in recent from the US, Europe Paulo), is research- editions of international magazines and South Korea. in the US, ing cellulosic ethanol such as The Economist and Sci- “And there is already Korea and in partnership with ence) is the increased investments a demand to create Europe similar centers from in research. In the last 10 years, the Labex labs in Japan the US, the UK, Chile budget of the Brazilian Ministry of and China”, reveals and Sweden. Marco Science and Technology rose 600%: Luciano Nass, coordinator of knowl- Aurélio Pinheiro Lima, director at from R$1.1bn in 2000 to R$6.6bn in edge interchange at Embrapa. In the CTBE, recalls that Brazil also has 2010 (this amount excludes person- US Labex, for example, the portfolio the conditions to guarantee itself a nel spending). Brazil is now an inter- of recent research includes studies privileged position in energy effi- national reference in areas such as that attested to the sound sanitary ciency in this new generation of bio- renewable energy, tropical medicine, conditions of Brazilian cattle, by fuels: Brazilian sugarcane produces biotechnology and agribusiness. In ruling out the possibility of Brazil’s around 10 tonnes of straw for each the latter, state-run company Em- cattle herd being a source of trans- hectare planted, while corn (used to brapa (Brazilian Agribusiness Re- mitting the H1N1 virus. Studies are make ethanol in the US) produces search Company) is renowned the also being carried out to support only four tonnes. “We have received world over for the excellence of its low-carbon agriculture, used in the a visiting professor from the US”,

P I B 53 Cover

NATURALIZED BraZilIANS The other project is at a more advanced stage, and should be inaugu- Large multinationals cur- researchers who worked at the com- rated in Rio de Janeiro in 2012, fol- rently see Brazil not just as a giant pany in other countries, but who lowing investments of US$100mn. market to be conquered, but also as wanted to return to Brazil. Borger GE’s Rio de Janeiro center will a source of intelligence and creation himself, after spending 12 years at employ around 200 researchers and of technology: this is the case of IBM in the US, returned to Brazil engineers dedicated to develop- IBM, the computer and IT giant that, to work on structuring the center, ing technologies for the oil and gas, in mid-2010, started to assemble its whose target (among others) is to renewable energy, mining, rail and ninth global research center in Bra- create technologies to support the air transport industries. It will be zil. Fifteen researchers are already exploration of natural resources and built on an island in Guanabara Bay, working there, some in São Paulo the services market. which is already home to the cam- and some in Rio de Janeiro, and this GE (General Electric), one of the pus of the Federal University of Rio number could increase if the market world’s largest industrial conglom- de Janeiro and Cenpes (the research sees fit (worldwide, the company erates, plans to install two research center of Petrobras). has around 3,000 researchers). Ac- centers in Brazil. One of them, fo- Following the pre-salt discover- cording to Sérgio Borger, technology cused on the creation of alternative ies, the Island of Fundão (next to strategist and operations executive fuels for locomotives, is still only a Tom Jobim International Airport) is at IBM, the center represents the protocol of intentions signed with rapidly becoming a global center of “realization of a dream” of Brazilian the Minas Gerais state government. scientific investigation related to

1 T U O ND A H

54 P I B 1 Future 2 Butamax center of GE in Paulínia: in Rio: next alternative to Petrobras to ethanol

oil and fuels in general. The Island place where Petrobras has one says Lima. “In this area, we want is already witnessing the assembly, of its largest domestic refineries. to be a center of reference for re- or recent inauguration, of research Butamax is a joint venture between searchers from all over the world”. centers of US company FMC and the US multinational DuPont and The CTBE team, sponsored by the French-US company Schlumberger British oil company BP, which plan federal government, currently has — respectively, global leaders in the to promote biobutanol (a second around 50 researchers and techni- markets of oil production equipment generation biofuel) as a more ef- cians, and this number should rise and provision of services for the oil ficient energy alternative than the to 90 by year-end. industry. Baker Hughes is also oper- already well-documented ethanol. ating on the Island, while fellow US “The new laboratory in Brazil aims to The importance company Halliburton is planning to accelerate the biobutanol produc- of innovation set up its own research center there. tion process on a commercial scale But just becoming more inter- Also on the energy front, renew- using sugarcane, the most efficient national isn’t enough: in order to able fuels are a magnet attracting raw material for producing biofuels”, yield the economic and social ef- companies from all over the world to says CEO Tim Potter. The Brazilian fects expected from the economy Brazil. At the end of 2010, Butamax lab will add to the research devel- of knowledge, Brazilian research Advanced Biofuels announced the oped by Butamax in India, the UK, and science needs to also face the opening of a biobutanol research Germany and the US, with the target challenge of getting much more lab in Paulínia, in the interior of São of initiating commercial production involved with private-sector eco- Paulo – coincidentally, the same of biobutanol in 2013. nomic activity, creating roots at companies in order to generate 2 innovation in products and services offered in the market. In this area, there still seems to be a long way to go. As Mr. Brito Cruz (from Fapesp) recalls, in the US exactly 103 patents were granted to Brazil- ian inventors in 2009 — onl7 5 more than in 2000 (Indian inventors, in comparison, registered 679 patents in 2009, versus 131 in 2000). Ac- cording to a Unesco study, in 2008 the Brazilian public sector still accounted for 55% of gross investment in research, with the private sector accounting for the remain- ing 45% - in the European Union, the private sector accounts for 65%. Mr. Brito Cruz believes the weaker development of corporate research is not down to a lack of resources or s o

t stimuli, since development initia-

lPho tives in Brazil are on a par with oth- Rea / er countries: the problem is mainly s o p

m due to macroeconomic issues, such Ca as Brazil’s massive tax burden and ne o cost of capital. “We also need to adst

Gl provide a bigger boost to exports,

P I B 55 Cover

since the international market de- (who is also a physicist with con- vating and creating technology is mands competitiveness, which in stant academic output, even when fundamental and are thus looking turn requires more research”, he he was minister) believes that to international cooperation. “We adds. Sérgio Rezende, business innovation now need to seek skill sets no mat- Brazilian Minister of needs to develop in ter where they are”, says Edmundo Science and Tech- The number Brazil, since Brazil- Aires, vice-president of innovation nology from 2005 to of patents ian companies are and technology at petrochemical 2010 (and often sin- registered alert to this need, company Braskem. Owner of two gled out as one of the and it is currently R&D centers in Brazil and one in the key people in provid- by Brazilian stimulated by in- US, Braskem also has partnerships ing the recent boost companies stitutional mecha- with universities from countries to scientific research remains low nisms. “In all coun- such as Holland, Germany and Can- in Brazil) recalls an- tries, governments ada – as well as Brazilian universi- other factor: research help to promote in- ties, of course. Its list of partners in developed in a structured manner novation”, he stresses. the generation of knowledge also is still a new activity in Brazil. “And Various Brazilian multination- includes Novozymes, a Norwegian innovation is even newer. Rezende als have already realized that inno- producer of enzymes (with which

Global academy

To speak of globalization of foreign students and research- students from any course can in- knowledge is also to talk of interna- ers. “We can also think about study corporate the credits obtained from tionalizing the “factories” of knowl- grant programs for foreigners and a semester of studies abroad (in edge: the universities. The academy subjects taught in English”, adds Medicine, two thirds of students opt has always been cosmopolitan: Mesquita (English has assumed the for this possibility). “When choos- since their beginning, in Middle role, previously held by Latin in the ing a university, candidates already Age Europe, universities have Middle Age, as the international have an international interchange attracted masters and students language of knowledge). in mind”, says Luciane Stallivieri, of multiple nationalities. But the Around 2% of Unicamp’s international relations advisor from accelerated process of globalization 15,000 post-graduate students UCS. “Professionals with interna- has provided fresh impetus to this are already foreigners, and the tional experience are no longer a trend; before becoming the global target is to increase this to 10% in 3 luxury, but rather a necessity”. communications network that it years. Mesquita believes Brazil has Last year, the University of São is today, the Internet, for example, advantages in attracting foreign Paulo (USP) granted over engineer- consolidated itself as a tool of PhD students, such as its renowned ing 500 diplomas that are valid in international interchange between competency in areas such as ag- countries such as France, Germany researchers. riculture and renewable energies. and Italy – dual diplomas require For Brazilian universities, “We have received strong demand students to take courses lasting intensifying internationalization for partnerships and agreements roughly one year in one of these is crucial, says Euclides de Mes- from countries such as the US, countries. “In addition to mastering quita Neto, provost of PhD stud- France and Germany”, he says. another language, dual diplomas ies at Unicamp (Campinas State Other Brazilian universities are prove that the student has experi- University) in São Paulo. Unicamp also offering students the chance ence of another culture”, highlights develops versions of its site in other to enter into international educa- Adnei Melges de Andrade, vice- languages and has plans to create tion networks. At the University of dean of international relations at a structure dedicated to receiving Caxias do Sul (in Rio Grande do Sul), USP. In the opposite direction, over

56 P I B University of Coimbra: almost 200 Brazilian students it studies ecologically sustainable the world, and we are being sought plastics) and the Anglo-American out to construct similar plants in company Ineos (also from the pet- other locations”, he says. rochemical segment) Another experi- sities from the US and Scotland, – a partner focused enced “internation- which feature multinationals such on polyethylene pro- Ethanol and alist” is compressor as Carrier, Honeywell, PepsiCo and duction technolo- the pre-salt producer Embraco General Electric. With plants in gies. But Braskem oil could make (from Santa Cata- Europe, Asia and the US, Embraco itself is a source of rina), which has re- studies (via these partnerships) not knowledge for the Brazil an energy search partnerships just applications for its compressors world. The Brazilian technology with universities but also acoustic problems – how to company is now an center from Germany, Chi- make its products less noisy. “We international refer- na, Switzerland and currently have over 200 research- ence in areas such as Romania (and again, ers from universities (15% in other green plastic (produced from etha- naturally, from Brazil). It is also a countries) involved in Embraco nol), says Aires. “We have the larg- member of international research projects”, says Fabio Klein, techno- est green plastic production plant in consortia coordinated by univer- logical development manager.

1,800 foreign students are currently taking graduate and post-graduate courses at USP. They are examples in the right direction. But Brazilian universities need to intensify the culture of internationalization, notes Carlos Alexandre Netto, dean of the Federal University of Rio Grande do Sul (UFRGS). “This culture is already present in areas such as engineering, but some courses are only starting to develop it”, he says. UFRGS is part of a group of Brazilian universities who have almost 200 students enrolled at the historical University of Coimbra in Portugal. Last year, representatives from over 1,000 Ibero-American higher education institutions determined that, by 2015, at least 2.5% of their gradua- tion students should study abroad a r (at UFRGS, this percentage is 1.7%). b m i o

“Internationalization is currently the C fourth operating pillar of a university, of sity r together with education, research and e v ni extension courses”, says Netto. U

P I B 57 Cover

In mid-2010, another Brazil- cellulosic ethanol. ian company with state-of-the-art All these are examples of how technology in its field of expertise inclusion in international research (pulp and paper producer Suzano) networks is becoming a routine concluded the acquisition of UK practice for Brazilian companies research company FuturaGene, willing to compete globally. When specialized in biofuels biotechnol- it comes to numbers, however, it is ogy and forest-growing. Valued at difficult to beat Petrobras in inter- US$82mn, this deal made Suzano national research partnerships. In (which already owned 8% of the 2009 alone (last year for which we UK company) the owner of a vast have consolidated data), Petrobras database of vegetal genetic infor- established 102 partnerships: 60 mation and of a research apparatus with companies and 42 with re- formed by labs in the US, Israel and search institutions. “Knowledge is China. This asset enables Suzano now the main asset of humanity, and to intensify its research into ge- it is spread across the world”, says netically improving the process of Carlos Tadeu Fraga, executive man- cultivating raw materials for mak- ager of Cenpes (the research center ing paper and pulp, and also posi- of Petrobras). “Those with access to tions it as a provider of biotech solu- knowledge, wherever it lies, have tions to third parties. And if all that competitive advantages”. In the last weren’t enough, it also gives Suzano 5 years Petrobras has spent around the possibility of working on the de- US$800-900mn a year on R&D. At velopment of new products, such as the end of 2010, it inaugurated the

A two-way street technologies, but we are looking to nology, health, aeronautics and expand this presence in areas such the environment. In the opinion For some time now the Euro- as nanotechnology, biotechnology of André Carvalho, from Finep’s pean Union has been looking into and agriculture”, explains Paulo International Cooperation Divi- the potential of Brazilian science; Egler, coordinator of BB.BICE — the sion, “international partnerships in since 2005, it has been publishing Brazilian Bureau for Expanding research and innovation are attrac- in Brazil its own research financing International Cooperation with the tive from the standpoint of sharing program, which paves the way for European Union, created to divulge not just know-how but also risks, collaborating with other countries. the European program. and research is a risky activity.” The program supports, for example, Brazilian institutions have also In the last 5 years, the São Brazilian scientists devoted to re- been investing in international Paulo agency Fapesp has estab- searching the relationship between partnerships. In the last two years, lished partnerships in countries nano-particles and degenerative Finep (Federal Government Finan- such as France, the UK and Portu- illnesses or mitigating ecological cier of Studies and Projects) has gal. The UK, for example, supports impacts on marine fauna. In 2008, signed agreements with institutions studies on the influence of genes in Brazil was part of 59 projects sup- from Spain and France. Now in its the development of blood dis- ported by the EU; last year, this second edition, the French partner- eases and forms of identifying and number had risen to 153. “The ship has approved four projects, characterizing stem cells. Microsoft research areas in which Brazilians in which eight companies (four Research (research branch of the are most involved are biofuels and from each country) will develop computer giant) has a partnership information and communication research in the areas of nanotech- with Fapesp that finances, among

58 P I B 1 Suzano 2 Sensors in research: in the Amazon: Brazil, the US, Microsoft-Fapesp China and Israel partnership

expansion (spending R$900mn) of Cenpes, the largest R&D center in the Southern Hemisphere. Cenpes is the axis of a conglomerate of laboratories from various multinationals from the oil and energy sector (see box on page 54). “In the future, Brazil is expected to be the largest center for developing technology in the areas of oil and energy this century”, says Fraga. In addition to fresh knowledge, international partnerships positively impact the confidence of other interested parties, recalls Thelma (from INPE). “At the end of the day, the presence of an international partner makes the private sector feel safer in pro- es ll

e viding resources, since it is more o T d

r difficult for a government to post- a c

Ri pone programs”, she concludes. 1

2 other projects, the development and application of geosensor networks for environmental monitoring in the Amazon rainforest. “This partnership has generated heavy two-way traffic of researchers, i.e. US-Brazil and Brazil-US”, says Car- los Henrique de Brito Cruz, scientific director at Fapesp. The scenario is promising, but Egler, coordinator of BB.BICE, makes a warning: Brazil needs to offer the world more information on its potential as a partner. The European program has a bilingual database on Brazilian science, called the Map of Competency.

“But it is very difficult to obtain any UT O

information”, notes Egler. “We AND don’t have the culture of making H APESP/ ourselves seen and heard”. F

P I B 59 Fashion From hippie to hype

The Sobral brand was created on the Rio de Janeiro beaches of the 1970s, but expanded by taking its colorful, bold fashion jewelry to Paris and New York Suz an a C am argo, Zur ick

everal decades separate items of the hippie repertoire and two very different busi- requiring only a small initial invest- nessmen. In the 1970s, ment. It was during these times that Rio de Janeiro native he discovered the raw material that Carlos Alberto Rezende would change the face of his prod- SSobral was one of those hippy ucts and his life story. It was 1976 and, craftsmen who defended alterna- at a fair on a Rio de Janeiro beach, tive living and made his money he came across some Argentinean from selling corroded metal ear- craftsmen selling objects made from rings and leather bags and sandals polyester resin. Enchanted with the on the beaches and plazas of Rio material, Sobral started to use it to de Janeiro. Today, aged 60, he is a make his products. businessman with stores in the US Colorful and asymmetric, So- and Europe and annual revenue bral’s fashion jewelry started to of US$8.4mn. His designs have al- make its mark in the fashion world. ready graced the catwalks of Paris, Made exclusively from resin, it was fashion editorials such as Oprah sold to distributors. Sobral worked Winfrey’s magazines, and also fea- as a ghost designer, as he himself ture in the wardrobes of pop stars puts it, for several years. “I created Beyoncé and Alicia Keys. designs for other fashion brands to It was almost by accident that put their names on”. Shortly after, businessman number one gave way production, a handcrafted process to businessman number two. At the involving a handful of assistants, time, the frenzied decade of the was transferred to Nova Iguaçu, 1970s, Sobral used to travel to Cabo in the Baixada Fluminense region. bral packed his bags and went off Frio and other beaches of Rio de Ja- And so, at the start of the 1980s, to France. He wanted to be success- neiro’s so-called lakes region to sell Gênesis was born – a company that ful abroad and he felt that France his products during the summer sea- would later give birth to Sobral. was the place. Carrying samples of son. To facilitate the logistics side of The company was still taking his wares and speaking very little the equation, he decided to focus on baby steps in Brazil when it decided French, he arrived in Paris on 14 fashion jewelry – lighter than other to bet on the European market. So- July, a French national holiday no

60 P I B Designs for Karl Lagerfeld: visibility

Despite the trip proving a failure, the rookie businessman returned to Paris a year later. This time, he established a network of contacts and took 120 kilos of products for imme- diate sale. “I paid a fortune at customs, but it was worth the investment”, he says. Sobral believes that just showing some samples wasn’t enough. The buyers wanted to see the end product and test it on store shelves. “The buyer doesn’t want to take any risks”, he says. “I learnt that from the Chinese: you have to offer the final product, ready to sell.” The second trip was more successful and the new orders fueled the business in the following years. Sobral started selling, via distributors, fashion jewelry to large French chain stores and boutiques. The brand was a hit with clients and paved the way for a regular flow of exports. In 1988, the company chalked up revenue of US$1mn. “Then the Chinese came. Their products were so much cheaper that there was just no way to compete with them”, recalls Sobral. To combat these unbeatable prices, Sobral looked to set itself apart from the competition and create its own niche. At the start of the 1990s, Gênesis gave way to Sobral, which started selling its designs directly to stores, cutting out the middlemen role of distributors. But the company needed to put the name of a designer on its products to justify the higher cost of its fash- ut o ion jewelry. And that’s exactly what

Hand it did. Sobral himself put his name on his creative designs. He contin- less. “To worsen things, it was the start. Those who opened their doors ued working with resin, but sophis- European summer season, when to Sobral didn’t trust what they saw; ticated his designs. The challenge almost everything shuts down. A many believed his designs were was to convince European buyers terrible time for doing business”, he made from semiprecious stones (a to spend a little more on his color- recalls laughing, during a telephone highly successful Brazilian export) ful designs, with a clear Brazilian interview to PIB from Paris. Indeed, and were disappointed when they look. “I learnt more and more as I it was certainly a most inauspicious discovered the resin. developed each collection, but a lot

P I B 61 Fashion

is still done on intuition”, he says. man woman who spent many years tion habits.” The next step was to create in Brazil and asked Sobral to open Sobral learnt a lot from his in- his own stores, in Brazil and, later, a store in the city. Very shortly, she ternational experience. He recalls abroad. At the turn of the century, expects to open another one in Mu- that, just when he was starting out Sobral realized the importance of nich. In Europe, the average ticket in the export business, he decided being closer to the consumer in or- is 60 Euros. A bracelet that cost, for to take to Paris the leftover products der to boost sales and strengthen his example, 20 Euros for wholesalers from the collection he had just sold brand. He opened his first store at was sold for 50 Euros at the retail in Brazil. He lost money. What was Galeão International Airport (Rio de level. fashionable in the Brazilian sum- Janeiro), a perfect window display In 2009, it was the US’ turn to mer was (very) old news in Europe. for those traveling abroad. He then discover Sobral’s designs. The first Sobral is one of the sector pioneers opened other stores store was opened in this international learning curve. in Ipanema, Búzios Despite the in Soho, a vanguard, Most national fashion jewelry com- and Paraty. He would fashion and arts dis- panies still haven’t managed to later step foot into success, the trict in the Big Apple. make the leap abroad. In the last the São Paulo market, fashion jewelry Sales are going well, two years, fashion jewelry exports first at the Guarulhos is still crafted although forecasts have been stagnant (at US$17mn), International Airport are conservative. The 20% lower than in 2008, when Bra- and then on Norman- by hand in New York Observer zil exported US$21mn. dia street (in the São Nova Iguaçu and the Trade and The Chinese specter still looms Paulo district of Mo- Style&Flair fashion large over the sector, which con- ema). sites reported on the tinues to seek market share abroad. At the same time, he was also opening of the Brazilian store. Be- Henriques believes differentiation opening up stores abroad. He has ing close to the end consumer has is the only way to gain market share. two in Paris, inaugurated in the past many advantages”, says Hécliton “Brazilian fashion jewelry and jew- decade – a wholesale store at Rue Henriques, president of the Brazil- elry have looked to Brazil’s rich du Temple, and a retail store on the ian Gems and Precious Metals In- culture and its diverse sources of charming and elegant Saint Louis stitute. “These advantages include inspiration to create a daring, fun Island. In Heidelberg (German uni- Sobral’s ability to constantly inter- and creative style to win over the versity and tourist center), the So- act with the various peculiarities of international market”, he says. It is bral brand has a store that is virtu- the markets and to rapidly respond difficult to put a finger on what this ally a franchise. It belongs to a Ger- to desires and changes in consump- Brazilian-ness is exactly, but when

1 2

62 P I B 1 The Cantagalo 2 Rio de Janeiro 3 Oprah is a big 4 Window display collection pays tribute monuments brought fan of Sobral’s in Soho, all the to Brazil’s shanty towns to life in resin fashion jewelry hype of New York

you see a Sobral design on display in als. Despite the success, his designs to open a franchise system. Sobral a shop window abroad you instantly are still crafted by hand, one by one, creates eight collections a year (four know it is a Brazilian design. We’re by around 100 employees back home for the summer and four for the win- talking about a veritable explosion in Nova Iguaçu. Some are made by ter). “When I’m abroad, people often of colors in a single design. Sobral Sobral himself. In the past, exports tell me that my fashion jewelry con- drinks from all the fountains of in- represented 50% of Sobral’s revenue veys a feeling of joy. I really think it is spiration. The themes of his latest – and the company is now gearing up the face of Brazil”, he muses. collection are the Sugarloaf Moun- tain and the curves of the Copaca- 4 bana sidewalk. But the brand has already launched collections paying tribute to the Russian painter Was- sily Kandinsky and to the Pop Art movement. Due to his vast knowledge of the French market, Sobral’s talent and creativity have already been recognized five times by the Eclat de Mode trade show for fashion jewelry, an international competition held annually in Paris and featuring fashion designers from all over the world. In 2007, the Sobral brand was invited to create the accessories of Karl Lagerfeld’s summer collection. And in 2008, Sobral’s fashion jewelry was gracing the catwalks of the Paris Fashion Week. ut o Vanity Fair, Elle and Ornamenta Hand

: are just some of the international es r magazines to feature Sobral’s fash- tu c i

P ion jewelry in their fashion editori-

P I B 63 Urbanism 1 Arial view of velodrome: facilities ready

2 Sketch of inner part of sports complex

3 Heather, of Deloitte: structure as legacy Olympic legacy In the final stretch to host the world’s largest sporting event and thousands of visitors, 2012

London shows it has much to teach Brazil n o nd o

Nar a v Idal, London L 1

monument inaugu- pay attention—and not only to the disassembled and the other parts rated in early March timeline being followed by the are being projected for use by the in Trafalgar Square, punctual British. It should also pay local population, which will make a London landmark, attention to the revolution that the use of the space, including gyms marks the deadline global event is provoking in one of and pools. forA preparations: in less than a Europe’s largest cities. One of the major goals in Lon- year the city will receive the 2012 London, which has invested 2.8 don is to make the games a spring- Olympic and Paralympic Games. billion pounds in the works, stands board to accelerate the develop- “The clock reminds us that we still out among the other cities that ment of the east region of the capi- have a great deal of work ahead of have hosted the event by its clear tal, creating a new economic anchor us,” said the mayor of London, Bo- concern with the legacy to be left for the continued expansion of the ris Johnson, perhaps with excessive to residents after the games’ clos- city, says Heather Hancock, partner caution, since an important part of ing ceremonies. From the choice at Deloitte Consulting in the UK, the works is well underway. of materials to the areas selected who is working together with the If the British capital is battling to receive the Olympic Village, ev- games’ organizers. One study under against the clock, then Brazil, as erything seems planned for the fu- her direction concluded that host- the next host of the world’s larg- ture. A portion of the buildings un- ing a global event is becoming a key est sporting event in 2016, should der construction in London can be item on the agendas of governments

64 P I B 2012 n o nd o L 2 d r Wa

n Joh 3 around the world. This is because it - 75% - are not for the Olympics, but put to rest any perception that Bra- allows cities to make decisions and for the legacy,” says Dan Epstein, zil is not a totally modern tourist execute projects that would nor- head of sustainability at London’s destination,” she adds. mally be bogged down in lengthy Olympic Authority, in an interview Heather makes a recommenda- debate and bureaucratic demands. with BBC Brazil. This indicates that tion that politicians in general do This structural heritage is what only a quarter of the total invest- not exactly follow. For the Olympics should be top-of-mind for development will be channeled into the to run smoothly, it is necessary to ing cities wishing to host the games, games themselves. “This is not just coordinate and integrate all politi- says Heather in an interview with about the Olympics, which is just cal divisions in the country - politi- PIB. “Most important is offering a one three-week event, but about cal parties and administrations in transportation infrastructure that developing a part of the city for the the federal, state, and municipal is efficient, reliable, and accessible,” next hundred years,” he says. spheres. “In London, this was all she advises. In the British capital, For Heather, the games in Rio put aside to ease the challenges and one of the main benefits of the will be a great opportunity for Bra- planning of the games,” says Heath- event will be the investment made zil to more broadly show its many er. “With the right governance and to improve urban infrastructure, faces, combining its cultural rich- committed political organizations, especially the network of trains ness with its strong sporting heri- ‘Rio 2016’ will happen in the best and metros. “The majority of costs tage. “It will be an opportunity to possible place.”

P I B 65 Internationalization The lawyers Paula Lippi (left) and Thais Castelli

Shedding the light on

The jump to internationalization and managing international operations require lawbrazilian companies to prepare to work with different laws and legal proceedings Antonio C arlos Santom auro

n mid-2009, when it was gal matters (of all types) in foreign legislation”, says Alencar Lehmkuhl, facing problems that, later countries – from the most common- the legal department head of Tigre on, would lead it to file place (such as opening an office) to (a Santa Catarina-based producer for Chapter 11 bankruptcy complex contracts related to buying of tubes, pipes and connections), proceedings, General Mo- large operations, and tax, labor and which has operations in another 9 Itors (GM) postponed, in the US, commercial lawsuits. To reduce the countries. When it is planning to payments due to Sabó, a Brazilian risk of setbacks, Brazilian multina- buy an operation in another country, manufacturer of auto parts present tionals need to have the flexibility Tigre investigates not only potential in 10 countries (in the US it owns and knowledge necessary to adapt problems in the environmental area, a plant in North Carolina). To safe- to each country’s legislation and le- but also performs quality tests on guard its rights, Sabó retained a US gal proceedings – with which they the soil and assesses the deposit of lawyer and, with his must obligatorily the company’s residues – in order to services, received all comply. Different le- safeguard itself from future lawsuits. that it was owed by Multinationals gal systems may have the new GM (name of need to be very particular char- Different models the surviving compa- flexible to acteristics, and they When it bought an industrial ny). And what’s bet- are always changing plant in Chile back in 2008, Artec- ter: Sabó continues to adjust to the – generally based on ola (a producer of specialty indus- supply the new GM. laws of each the inclusion of new trial and laminated adhesives from “In the US, once legal country legal requirements Rio Grande do Sul) faced prob- matters are resolved, for companies to lems related to local environmen- business continues as comply with. tal legislation requirements. The normal”, notes Braulio de Carvalho, A good example of new branches acquired unit was already operat- administrative and financial direc- of law being incorporated is envi- ing and Artecola underestimated tor of Sabó. ronmental legislation, which is be- the possibility that the plant was a Just like Sabó, other Brazilian coming increasingly relevant almost violating environmental protection r guei

companies with an international everywhere you look. “Nowadays it regulations. And there were indeed No

presence could be involved in le- is just as important as tax and labor pending matters, whose resolution Max

66 P I B redantas@dantasdesign. com.br

P I B 67 Internacionalização ó sab / ut o Hand 2

required unforeseen efforts and investments. “We try to map out all the variables, but reality always has a surprise in store”, recalls Eduardo Kunst, executive president of Artec- ola. Since it also owns plants in markets such as Argentina and Mexico, Artecola delegates legal matters to lawyers from the countries where it operates. “The choice of groups ut o [of legal services] with a presence in

Hand several markets doesn’t always pay 1

GLOBAL RIGHTS joint venture, a start-up company or Kunst, from Artecola, highlights hiring a representative or agent. In the possibility of following sugges- The intricate global web of order to find the specialists who can tions of the law firms with which the different laws and legal structures help them better understand the company already operates in Brazil, isn’t deterring the growing interest legal specificities of a new market, many of whom have international of companies to expand into other companies need to resort to various partners. “We also talk to Brazil- markets. “However, they need to sources. Wizard, for example, seeks ian companies already operating in assemble their own legal structure suggestions from a Brazilian sector that market. We always select three to support the model adopted in an- entity, the Brazilian Franchising options of law firms: then, a director other country and take all the neces- Association (ABF), when it needs goes there, speaks with them, and sary steps to protect their presence to retain lawyers in the countries we take the decision”, he describes. in that market”, recommends Thais it enters. “When the ABF doesn’t According to Kunst, of all the coun- Castelli – a lawyer from the Castelli know anyone in a given country, tries where Artecola is currently & Castelli law firm. This applies it can recommend a similar entity present, Argentina possibly has for any business model adopted there, where we can seek advice”, the most complex and inefficient – whether the new operation is a says Luisa. (from a timeframe perspective) legal

68 P I B 1 Braulio de 2 Sabó Carvalho, from division in Sabó: lawsuit Germany: against GM protected in the US asset tries where they work and greater familiarity with the local culture. International law firms generally reproduce a standardized modus part of groups of independent law operandi in each country, notes firms, Felsberg also has its own law Thais Castelli, a lawyer who is cur- firms in the US, Germany and China. rently partner of the São Paulo law firm Castelli & Castelli, where she Guatemala versus the US works with Paula Lippi. Having The acquisition of assets in other previously worked in the corpo- countries is a possible source of fu- rate areas of cosmetics company ture legal problems, involving ex- Natura and food company Sadia, partners of the acquired company, Thais has accumulated a wealth of consumers, public authorities, sup- experience in selecting law firms in pliers or clients. That’s why signing dozens of countries. such a contract is generally preced- But a direct international pres- ed by a process known as due dili- ence in several countries is also gence, in which the potential buyer off, since sometimes my operation an interesting option, says Neil assesses the company’s potential isn’t that important for the law firm Montgomery, a partner of the in- liabilities in several legal areas (the of this group”, explains Kunst. ternational division of the Felsberg process also includes the analysis This is a recurring discussion: e Associados law firm, from São of the company’s financial state- who can provide the best legal as- Paulo: “This presence implies the ments by auditing firms). When it sistance to a company planning to existence, in these countries, of negotiates the purchase of an off- enter into a still unknown market? someone who speaks the same lan- shore operation, Tigre uses a group Large international groups, or local guage of Brazilian businessmen”, he formed by its corporate legal area, a law firms? The response isn’t always argues – a point also highlighted by law firm from the country where the conclusive. The initial impression is Paulo Frank Coelho da Rocha, part- negotiations are taking place and a that local lawyers have the advan- ner and director of the Demarest e Brazilian law firm with internation- tage of a specific focus on the coun- Almeida law firm. As well as being al experience, capable of also help-

environment. Montgomery, from the region, says Luiz Sette, partner investment capacity and business the Felsberg e Associados law firm, from the Azevedo Sette Advogados potential in other markets, and its also recalls that the Argentinean law firm. In France, he specifies, any management team wants the com- legal system is frequently influenced contract must consider labor laws pany to expand abroad, legal mat- by political questions, which have a capable of preventing (or at least ters are unlikely to pose problems to very strong importance there. making extremely onerous) employ- its internationalization process”. In “A Latin-American country currently ees with a certain amount of time at addition to specific preparation, this seen as a model in terms of its a company from being fired. and, he means the company should treat legal-business environment continues, the Mexican legal system local legislation with the utmost is Chile”, he says. is extremely slow and inefficient, respect. “In the international mar- In China and India, the legal even when compared to Brazil. How- ket, we compete with large global systems are highly complex and bu- ever, in the opinion of Sette, none of corporations, and this means there reaucratic; in India, certain aspects this is preventing the international is absolutely no room for mistakes”, of the legislation (in the tax area, flight plans of new Brazilian mul- concludes Braulio de Carvalho, from for example) may vary depending on tinationals. “If a company has the Sabó.

P I B 69 Internationalization

ing it to find a local law firm. “This group is crucial from the standpoint of preventive action, minimizing the possibility of problems further down the road”, highlights Lehm- kuhl, head of Tigre’s legal division. But even companies with a strong international presence and that take the utmost care in their business dealings may, at any given moment, need to resort to emergen- cy solutions to resolve a legal matter abroad. An example is Gerdau, a Brazilian steelmaker with industrial facilities in 14 countries: in one of its transnational acquisitions, it faced difficulties getting the deal down on paper – despite being qualified to carry out due diligence, the local law firm involved in the operation lacked the necessary expertise to draft more complex contracts. “The matter was resolved by our corporate legal team”, re- 1 calls Expedito Luz, executive vice- contracts to resolve the problem president of legal and compliance of a lack of national legislation. At at Gerdau. And once all the steps the same time, developed coun- involved in the initial purchase op- tries with a history of political and eration have been resolved, with the administrative decentralization are new subsidiary already controlled usually complex places, due to the by the Brazilian par- variety of local laws. ent company, it’s time “In the US, some as- to face the peculiari- Competing pects of the legisla- ties of each legal and with large tion on franchises business culture. In global may vary from one Latin America, says state to another”, Luz, labor law gen- companies, notes Luisa Siqueira, erates a massive vol- there’s no manager of Wizard’s ume of lawsuits. “In room to slip up international divi- the US and Spain, sion. Also present trade union matters in countries such are highly complex”, he adds. as Ireland, Japan, England and And there may be strong dif- Mexico, the first legal measure 2 ferences in the degree of sophisti- that Wizard adopts, whenever it cation and complexity of the legal enters a new market, is to protect systems. In Guatemala, for example, its brand. Brand-related concerns ut there is still no law on franchises; intensified during Wizard’s recent o Hand

for this reason, when it set up shop entry into China, a market feared by : es in the country, the language school many Brazilian businessmen due to r tu c i chain Wizard elaborated detailed the absence of stronger controls in P

70 P I B 1 Luisa Siqueira and Wizard division in China: protected brand

2 Kunst, from Artecola: unforeseen problems

3 Montgomery, from Felsberg: the importance of speaking the same language

China: “Germany has much stronger ties with China…the Germans opened this market up to the auto parts industry”, explains Carvalho. In another example of the fact that there is no magic formula to become a multinational, the local partner that Sabó chose to discard could, in other cases and in China 1 itself, serve as a vehicle for opening questions related to brand and intel- doors and expediting the process of lectual property rights. “In China, setting up companies. “In some sec- we have more extensive contracts in tors, this partner is even a require- the sections devoted to brand pro- ment”, highlights Coelho da Rocha, tection”, says Luisa. from the Demarest e Almeida law firm. But if there is any mistrust “In-depth knowledge” in the legal system of the country Protecting intellectual property where the would-be Brazilian mul- rights in the Chinese market also tinational plans to set up shop, the required an extra effort on the part contracts established with local of Sabó. In order to better safeguard partners may elect a third nation or this asset, Sabó (in addition to elab- entities dedicated to multinational orating more detailed contracts in arbitrage (such as the International the items related to intellectual Chamber of Commerce) as a forum property) preferred to set up shop for resolving legal disputes (provid- in China without the support of a ed local legislation doesn’t obstruct local partner (with whom it would a change of jurisdiction). One way or have to share industrial secrets). another, regardless of the business 3 And the multinational experience context and the legal environment, accumulated by Sabó was also use- Coelho da Rocha believes that one ful in smoothing the path. The Chi- rule always applies: a company look- nese plant was structured as a sub- ing to do business in other parts of sidiary of the company’s German the world should know the target operation, as a way of leveraging foreign company inside out: “Every (in Sabó’s favor) on the strong eco- company has a past, a history and nomic ties between Germany and possible liabilities”.

P I B 71 Business

Surgical expansion In four years, Loktal, a medical product factory, has set up shop in 32 countries, from which it obtiains 30% of its revenue Pedro M arcondes de Moura

business mission of business. Developed by the part- ticipated in the Fime international in the United Arab ners Uriel Binembaum and Paulo sector trade fair in Miami. It was Emirates, meetings José de Almeida, the equipment the stepping stone to start export- with distributors originated the company and is used ing. “The product was immediately from South Korea, for small- and medium-scale sur- well received and we made contacts aA meeting in the Dominican Re- geries requiring maximum preci- with Latin-American distributors”, public. Three countries in 15 days. sion. Since it can be used in several recalls Grillo. This has been the routine of Lu- medical specialties, the scalpel has In a keenly contested market, ciano Grillo since being hired four a broad market and the cost-benefit years ago to initiate the export is currently Loktal’s tradeoff of the Wa- operations of Loktal Medical Elec- golden egg. In the Participation in vetronic 5000 Digi- tronics. Founded in São Paulo 20 last four years, the a fair in Miami tal was what led years ago, the factory specialized company has gained Angelo Rostirolla, in electronic surgical equipment global market share was the director of Clinica- now sells to 32 countries, includ- and is fighting tooth stepping lar, to become the ing the Latin American, European, and nail with US and stone to start exclusive distributor Asian and African regions. The Chinese competitors of Loktal in Venezu- agenda of Grillo, who is respon- for new clients. exporting ela. “The scalpel is sible for tracking the company’s Up until 2007, conquering the mar- international expansion, is proof however, the international outlook ket since its technology is similar that the strategy has paid off. of Loktal was very modest. With to Ellman International [a US com- The company makes six prod- the support of Apex-Brasil (Bra- pany and the world’s main producer ucts, but the recipe of Loktal is fo- zilian Pro-Export and Investment of high-frequency scalpels], which ut cused on selling just one of them: Agency) and Abimo (Brazilian costs twice the price”, says Rosti- o Hand

the high-frequency electronic scal- Medical, Dental, Hospital and Lab- rolla, highlighting that the compet- : es pel Wavetronic 5000 Digital, which oratory Equipment Industry Asso- ing product costs up to US$11,000 r tu c i represents (according to Grillo) 99% ciation), in 2007 the company par- (around R$18,500) while Loktal’s P

72 P I B 1 Loktal 2 Wavetronic, presents scalpel the high- at international frequency trade fair scalpel

1 2

Wavetronic 5000 Digital costs also fans of the Brazilian product, coordinator of commercial intelli- US$5,000 to US$6,000. “Chinese emerging markets were respon- gence at Abimo. “That’s not the case scalpels are cheaper, but they are sible for boosting the company’s with Loktal, whose differential is low quality and have several tech- sales – Loktal currently focuses its precisely its desire to discover new nical problems”, he explains. A expansion on commercial missions markets”, he rounds off. Due to its third of Loktal’s scalpel exports go to countries such as Iran and Egypt, active positioning, in 2010 Loktal to Venezuela and Mexico. where it virtually operates alone. won the Apex award for small and Loktal also used trade fairs to “There is no bad place to close mid-size companies in the “New present its product to the Europe- deals. If the coun- Markets” category. an market. Its presence at Medica try’s health is pre- With a target to (world’s largest event in the seg- carious, the chances With a growth grow 15% this year, ment), held in Düsseldorf in 2008, of signing contracts target of Loktal has an even led Loktal to start eyeing the Euro- are greater”, ana- more ambitious pean continent. Despite not having lyzes Luciano Grillo. 15%, factory challenge: facing European certification at the time In Peru, for example, is gearing up the main Chinese (obligatory for exporting to Euro- Loktal should short- to face US and US competitors pean countries), all the scalpels ly sign an agreement on their own turf. It taken to the event were sold. Those with the government competitors has already signed who bought it liked it, and the new to implement a scal- an agreement to sell orders showed the need for certifi- pel in every public health unit. In 300 scalpels per year to China. In cation – which was obtained after Angola, the product should be used the US, it is seeking the permits six months of red tape, at a cost of in the Women’s Health Program. needed to sell its scalpel. “We are US$60,000. In the following edi- The strategy has led Loktal to already looking for a heavyweight tion of the German trade fair, Lok- derive 30% of its revenues from distributor for the operation”, says tal signed contracts with Spanish abroad. “Many companies from Luciano Grillo. The current struc- and Portuguese distributors. this segment still fear internation- ture of 50 employees should soon Although traditional buyers are alization”, says Tarso Evangelista, become small.

P I B 73 Beacon Local initiatives and innovations in a global world

1 Ugalde in action: Environmentalist of the century, says Time magazine

2 Seed money for local forests: education, loans, and “ecological” interest

Protector of the forests 1 After leading a revolution that transformed Costa Rica into an ecological sanctuary, environmentalist Alvaro Ugalde wants to export his green model to the world Andressa Rovani 1

ith 4 million in- where the environ- He crystallized flected in the coun- habitants, Costa ment pays the price try’s financials. The Rica, in Central for fast growth, in the idea: influx of money from America, is little Costa Rica, the for- trees are tourism represents known in Bra- ests have become al- worth more 7.1% of the GDP (U.S. Wzil. Too bad for us. In recent de- lies of the economy. $ 3.4 billion) and is cades, Costa Rica has advanced at Currently, a quarter standing growing at a rate of an astonishing pace. The country, of the country’s en- than felled 12% per year. which at the end of the 1940s dis- tire territory is un- This transforma- tinguished itself by eliminating its der environmental tion, which began Army, currently boasts a 95% liter- protection. With the gradual in- 40 years ago, has a name: Alvaro nstitute I a

acy rate, houses an important cen- crease in green space, ecotourism Ugalde. If today the Costa Ri- r

ter for microchip production, and is has gained strength - the country can economy has a green engine, tand c e

one of the world’s major ecotourism today is considered the “cradle of credit is due to this 64-year-old : N es destinations. ecotourism”- attracting 2 million biologist, who for 40 years has r tu c i

Unlike developing countries, visitors in 2010. This is clearly re- led a revolution in his country. He P

74 P I B 2

worked for 17 years as an employee deavored to protect water sources. to be interested,” says the biologist. of the national park system, where He founded the Nectandra Institute, “After six loans, we have no doubts he pressured the government to which lends interest-free money to about its interest and usefulness.” protect its forests and crystal- qualifying rural communities that Instead of financial interest, lized in the minds of Costa Ricans, manage their own water systems. the institute charges communities including peasants, the idea that “It was necessary to accelerate pro- “green interest.” Each group re- trees are worth more standing grams to save what remained and pays the loan and pays “ecological than felled. Costa Rica today has to restore, as much as possible, the interest “ through activities such 32 national parks, which account tropical forests,” Ugalde said in an as reforestation of the local forest for an estimated 5% of the world’s interview with PIB. or by continuing environmental biodiversity. Thanks to these re- Nectandra acts in areas of eco- education. “We believe the model sults, in 1999 he received the title logical interest as a non-profit. Its can be exported to other water- of «Environmental Leader of the work started on the Balsa River, in shed lands of Costa Rica and even Century,” from U.S.-based Time the north of the country. “When we to other countries,” said Ugalde. magazine, among others. first started, we had no idea that Brazil should be the first to wel- Since 1999, the biologist has en- rest of the communities were going come him.

P I B 75 Globe-Trotter • Executive Travel Marco rezende

TEChNOLOGY Here comes “Google room view” Would you like to know exactly what that room you want at the Copa- cabana Palace is like before reserving? Soon this will be possible. The company Room 77 is launching a site for those who want to see how a room really is before making the reservation. Just like the site TripAdvi- sor, Room 77 will also use crowdsourcing, photos, and descriptions from guests. The system does not offer 100% credibility, but it does have, at the very least, photos as its best weapon. Users can also see the position of the room on the floor, which is great

for those concerned about atistessa

noise coming in from out- ro B side the room. http://www. essand

room77.com/index.html Al 1

GastronomY The worst restaurant in the world 3 A.A. Gill, the celebrated and scathing Vanity Fair food critic, has a sense of humor and is elegant even when being cruel. In the latest edition of the magazine, Gill skewered an old Paris icon beloved by cosmopolitan Americans (Bill Clinton, Woody Allen ...), snobbish Brits, and Brazilians with expense accounts: L’Ami Louis, the venerable restaurant with no stars .com

but plenty fame, which opened in 1924 on Rue du Vertbois, near ess r

the Marais. “Given its colonic décor, surly service, unbelievable dp .wor

food, and hefty bill, the restaurant is a true Gallic triumph,” Gill g lo

wrote sarcastically. He closed the review with the phrase that is bb o also the title of this piece. The full text can be read at http://www. dsn

vanityfair.com/culture/features/2011/04/lami-louis-201104 foo 2

76 P I B 1 Copacabana Palace, in Rio: soon, seeing is believing

2 L´Ami Louis: fine clients, indigestible n mo review uge o R / e c i 3 Estelle r Touzet: Mau

Le 3 France’s best wine sommelier A lady sommelier at 29 Sommelier at the Hotel Meurice, Estelle Touzet was elected by the Pudlowski Guide as the 4 Hotel Carl best sommelier in France in 2011. Not bad for a young woman of just 29 years, born and raised Gustav, St. in the Loire River Valley region known for delicious whites like Muscadet, Sancerre, and Pouilly- Barth: option Fumé. Estelle says she became interested in wine during history classes - and did some home- among 140 work. She studied at the Albert de Mun hotel school and worked in restaurants of star chefs like Guy Savoy (Château de Cordeillan Bages) and Tom Aikens (London). She now presides over five assistant sommeliers, and a 30,000-bottle wine cellar at Paris’ most aristocratic hotel.

Airport

Viva Viracopos! city center and Guarulhos takes three international flight atV iracopos since hours. It may seem like too much, but Guarulhos opened its doors in 1985. It Whenever the acronym GRU the route’s 30 kilometers are subject may seem far away, but the lovely air- appears on an airline ticket, a pas- to nightmarish traffic jams every day, port, which offers a serene, redesigned senger knows that he is guaranteed an especially when it rains and during concourse compatible with the sur- extra headache- the absolute uncer- rush hour. Viracopos airport in Campi- rounding countryside, is served by two tainty about how long it takes to get nas, 90 kilometers from Sao Paulo, excellent highways, Anhanguera and to Guarulhos International Airport now offers a great option for those Bandeirantes. Uruguayan airline Pluna itself (known as GRU). On the TAM traveling to Europe. TAP has launched has followed suit and introduced daily website, the company advises that the three weekly flights toL isbon and flights (except Sunday) toM ontevideo. trip between Congonhas airport in the connections, reintroducing the first Hopefully, there is more to come.

HOTELS A good cost benefit What does the historic Solar do Rosário in Ouro Preto, Brazil, the Hotel Carl Gustav, refuge for the plati- num card set on the Caribbean island of St. Barth, and the Heritage Awali Golf & Spa Resort in Mauritius, in the middle of the Indian Ocean, all have in common? All are part of the Hotels & Preference Association, which brings together 140 establishments around the world n

with the rare combination of luxury and moderate pric- llo ai ing. The network is now represented in Brazil. www.hotel- r Mu

k c spreference.com or for reservations with a more personal i r at P touch, call Melina Amaro da Luz at (+55-41) 33361546. XXXXXXXX 4

P I B 77 78 Globe-Trotter - Express Tourism P IB I It would b would It hours, and not explore the heart of M of heart the explore not and hours, trip over K to trip a that, Irecommend After Basil’s Saint of sive cathedral. domes impres the and incity) the shopping luxurious malls most the GU side, beautiful other and, the the by on R the of (home Kremlin the of walls the by R the era, Soviet the from key of events scene The monuments. M of most to ing get –home to there afew hours city, suffer thisin it hectic is worth traffic intense the Despite Do”, a restaurant just afew away just minutes Do”, theater. the from arestaurant trendy, and “Do out modern more something check wanting those For willing pay“must forto those for meal. agood visit” a restaurant, Bolshoi dine the at that, not show. out why After ballet forworld’s famous aticket the buy most still youif can away. your checking breath Irecommend takes buffs, ballet For R the Near vodka. of shot old (wheat-basedbeverage) agood just or akvas with down washed ed Square has eclectic architecture, surrounded on one side one on surrounded architecture, eclectic has Square ed f you have a few hours... C A by Moscou, steeped in history and charm. and in history steeped restaurants avenues and monuments, R around times”,nist –our guide says Pablo commu former its of remnants the hide (from tourists) cannot still it but in senses, many surprise can that city “It’s– evenfor just a if afew hours. around alook you that take demands visible, and is instantly architecture eclectic cow, multi-colored, city’s the of humanity.of visiting those For M history the of part are that monuments cultural and architectonic has also year-long weather cold for its known W L M (renowned) musician Arthur music of fellow where school kovsky Tchai famous world the at studying in M 5years almost music. H classical Brazilian of leadingexponents the of one ered ima, among others, also studied. studied. also ima, others, among t the age o age t the atarina pianist Pablo R Pablo pianist atarina ith a population of 11 million, the city million, city the 11 of apopulation ith Pablo Bolshoi Ballet Ballet Square, imposinged the Bolshoi ussia’s city, its with capital afe Bosco afe crime to visit to R e acrime

R f j ossi ust 21 ust oscow, is Pablo to eat a blini (typical R ablini (typical eat to ossi is consid , Santa , Santa aving lived ussia, even for if afew just oreira oreira os - oscow: the R the oscow: - - - ussian government) M building (one of ussian pancake), oscow’s main ed ed Theater truly truly Theater S quare - - .

Damir Yusupov 1 Saint Basil’s Cathedral and the Kremlin at the unmissable Red Square

2 Ballet dancers from the Bolshoi Ballet Theater

3 Faberge eggs: Kremlin icons C SX 1 .com e m sti m ea rov-Dr Maka r exande Al 2 3

P I B 79 Globe-Trotter - Express Tourism If you have the whole day... Russia’s orthodox religion suffered for decades from the repression of the communist State, and many of its beautiful churches were ripped apart and demolished. The history of the Christ the Savior Cathedral is fascinating and definitely worth a visit. Built by Czar Nicolai I in the first half of the 19th century, Stalin ordered the giant monument to be demolished. It was only decades later, in capitalist times, that the Basilica was reconstructed using photos and documents from the Czar years. It is worth reminding tourists of the orthodox traditions: men must not wear anything on their heads (no hats or caps) while women should wrap veils around their heads. After visiting the basilica, stop off at Baba Marta, a restaurant that serves up Caucasian food. After lunch, take a stroll on the Gogolevski Boulevard. As you go up to Tverskaya (Moscow’s main avenue), visit the museum/ house of Gogol – considered the best Russian writer from the first half of the 19th century and forerunner of all the major Russian writers who came after him. A bit further on (down the same boulevard), and you arrive at the “Old Arbat” street. Built back in the 18th century, it was considered the heart of artistic Moscow in Moscow’s so-called “golden age”. Leading lights of Russian culture and history used to either frequent or live in the region, such as the writer Pushkin and the com- posers Tchaikovsky and Scriabin. Visit the house where Pushkin used to live. And for music lovers, the house of the pianist and composer Skriabin is an absolute must. To round off the day, I suggest dining out at Kafe Pushkin, an authentic classic in terms of Russian and European cuisine. And if you’re looking to relive the afore- mentioned Golden Times, the Turandot restaurant (owned by the same people who run Kafé Pushkin) will take you down the memory lane of the 17th and 18th centuries, with its rococo-inspired ambience. The restaurant is a popular place with tourists, who go there to appreciate this bona-fide work of art that cost US$75mn. As an entrée, try the “wasabi shrimp”, an exotic Chinese dish. ch i rov i m adi l V ket oc R 3 4

80 P I B 1 Café Pushkin: to try Russian cuisine

2 On the menu, the salmon is a specialty

3 Cosmonaut Museum: historical rockets

4 in the gigantic VDNKh park kin h us P e f Ca

ut o nd o H 1 2 If you have the whole weekend... The Kremlin, official headquarters center, and home to the fascinating Cosmonauts of the Russian government, merits an entire day’s Museum – don’t forget to take a picture next to attention, since you’ll be visiting one of the rich- Strelka, a Soviet dog (and a heroine no less) sent est museums in Russia, the Armory Chamber, in to space by the communists back in 1960. The addition to enjoying a long stroll through the vast only problem is that everything in the museum Kremlin grounds, with its ancient churches. The is in Russian, but it’s still worth checking out the museum offers the eyes a glimpse of the clothes prototypes of satellites and spaceships. Without used by the various generations of Czars and the abandoning the space universe, go for a drink at famous Faberge eggs. After delving deep into the Strelka restaurant, on the banks of the Mos- Russian history, go and see one of the concerts in cow River. the “Bolshoi Room” of the Tchaikovsky School of For those seeking an alternative experience, the Music. Next stop is a trip to one of the Café Mania Novodevichy cemetery is the place – home to restaurants, which is part of the music school and famous Russians of yesteryear, it also lies next to an opportunity to become better acquainted with the Novodevichy convent (a World Heritage Trea- Moscow’s citizens. sure). A walk through its corridors will shed a bit If you still have a few hours to kill, it would also more light on the history of the Orthodox Church. be a crime not to visit the Tretyakova gallery and As an eating option, the Mari Vana restaurant (a learn more about Russian painters. From there, I personal favorite) lies in the heart of the Patri- recommend a trip over to the gigantic VDNKh, a archs district. Relax and try the borsch, a famous park bigger than the principality of Monaco. With Russian soup made from beetroot. It’s one of the 400 buildings, the VDNKh is Russia’s main expo coziest places in the city.

P I B 81 Globe-Trotter • In transit Paulo Striker* Paulo and friends, in front of the Jeddah mecca Under the laws of the koran Respecting foreign customs is essential for running a company in saudi arabia, tion ersonal collec where religion dictates everything Paulo Striker/P

After two years in Saudi Arabia leading the few times at the homes of Saudis – but that was enough to real- operations of Sadia (now known as BRF Brasil ize just how abundant food is. Invitations, in general, are only Foods), I realized that Brazilians pay relatively for business events with other men. A situation in which you go little attention to meals and food. In Brazil, out to meet a Saudi in a place with their wives is very, very rare. always green, people in general don’t even Since chicken is the preferred protein, Sadia is a very strong realize the abundance and variety of products brand in Saudi Arabia. So much so that the word Sadia was that leave the countryside to supply the cities. incorporated into the national vocabulary and has become Here, in a country that is almost completely synonymous with chicken. What is interesting is that the word is engulfed by the desert, food and meals have confused with Saudi, the name of the country, creating a special a radically different importance. Food is an bond between the company and the country. asset in itself, a product with major value. For But it isn’t just the food that makes life here special. The Saudis, the very act of eating, so trivial to us, fact that the country is a religious monarchy makes it a very represents a moment of huge importance, different place to what we Westerners are used to. Everything from both a family and social aspect. revolves around religion. The logic of business and relation- As is common knowledge, the prevail- ships is also based on it. For example, when you are negotiating ing doctrine in Saudi Arabia is a strongly something, such as hiring a service, the legislation is entirely conservative branch of the Islamic religion, based on the Koran. which frowns heavily upon Western forms of You have to be flexible. Upon moving to Saudi Arabia, I had entertainment such as cinema and theater. to take many different customs on board. And not just me. We Food takes their place. Families are very live in a condominium for expats. The condo offers the liberties large, incorporating cousins, nephews/nieces, we are used to in the Western world. But upon leaving home, my uncles and grandparents. Women in general wife must wear an abaya – it is not a burka, but instead a long, don’t work and spend hours in the kitchen. On black clock. She is not allowed to drive. There are no alcoholic Fridays (the day of rest for Muslims), when the beverages. Beyond merely the desired professional growth, be- temperature is pleasant as it is now, when the ing exposed to a completely different culture makes us recon- winter takes the edge off the oppressive heat, sider some of our concepts and gives us a broader view of the any place with a bit of green area (such as world. I feel a strong sense of accomplishment for being able plazas and highway median strips) fills up with to lead such a complicated process. In terms of living in such a families eating picnics. different country, well it has its advantages and disadvantages. Saudi Arabia is a major consumer of I call them differences. chicken, and their typical meal really is rice and chicken. They usually use their hands to eat chicken, removing it from a large plate. In the two years I have been here, I have only eaten a *Paulo Striker, 56, is director of Brf’s operations in Saudi Arabia

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