STATES INVEST IN RIO GRANDE DO SUL ACKNOWLEDGEMENTSACKNOWLEDGMENTS The American Chamber of Commerce for Brazil, being the largest Amcham outside the United States is constantly serving its members by building bridges for Brazilian businesses worldwide. TheOur American foreign Chamber investment of Commerce attraction for Brazil, ef beingforts the have largest also Amcham been outside a key the leading United States point is constantly for Amcham. serving its The How membersto Series by building is part bridges of this for initiative. Brazilian businesses With the worldwide. support Our of foreign some investment of our corporateattraction efforts members have also we been are a putting keytogether leading point strategic for Amcham. information The How to Serieson the is part most of this various initiative. aspects With the supportof doing of some business of our corporate in Brazil. members As part of th weBRICS are putting (Brazil, together strategicRussia, information India, China on the most and various South aspects Africa) of doing and business representing in Brazil. As the part 6of BRICSlargest (Brazil, economy of Russia,the world, India, China Brazil and South has Africa) clearly and representing demonstrated the 7th largest its economyimportance of the world, in the Brazil global has clearly market. demonstrated The itscountry’ s importancebusiness in environmentthe global market. Theas wellcountry’s as businessforeign environment investment as well numbers, as foreign investment despite numbers, international despite international crisis, continues crisis,very continues positive. very Mediumpositive. Medium and andhigh high classes classes are are increasing, increasing, which creates which a solid creates internal amarket solid and internal contributes market to and contributes to maintain good results in the economy. The 2014 FIFA World Cup has been estimated maintain good results in the economy. The 2014 FIFA World Cup has been estimated in US$ 56.8 billions and the 2016 Olympics in USD 56.8 billions and the 2016 Olympics in USD 19.3 billions in investments. These events have in US$ 19.3 billions in investments. These events have had an impact on direct investments in Brazil and in infrastructure projects had an impact on direct investments in Brazil and in infrastructure projects needed to hold them in needed to hold them in the country. It is now more than ever a strategic time for businesses opportunities in Brazil. We welcome the country. It is now more than ever a strategic time for businesses opportunities in Brazil. We youwelcome and hope that you the and information hope thatyou are the about information to read serves you you best. are about to read serves you best. GabrielGabriel Rico Rico- CEO, Amcham- CEO, Brasil Amcham Brasil Recent data on Rio Grande do Sul economic performance provides evidence of the state’s dynamism. In 2013, the growth of the state’sRayes gross & domestic Fagundes product Advogados (GDP) led the Associados national ranking, is with a full a 5.8% service increase, law while firm the overallrecognized Brazilian forrate itswas expertise2.3%. and Inexperience addition, RS saw in 6.8% representing industrial production and growth,advising ahead foreign of the 1.2% companies national average. and Unemployment individuals statistics in Brazil.(3.5%) and Over the exportsyears, (+44.3%) we have also highlightlearnt thatRio Grande it is importantdo Sul’s economic not performanceonly to provide in comparison specific with the legal national support, average. but also to help our clients understand the whole environment in which they will make their decisions. The idea Theseunderlying results are athis reflection brochure of a combination is providing of different foreign factors, investors such as Rio andGrande entrepreneurs do Sul’s strategic withlocation, an the overview diversity of the ofmain its economy legal and aspects an environment for establishing that is favorable a tocompany business. It oralso simply reflects thedoing work businessdone by the statein Brazil. through its Our Industrial relationship with Amcham is a long-standing one and comes from the great number of US companies and Policy, drawn up to promote Rio Grande do Sul’s economic development. All these aspects are described in detail in this individuals we have been advising since the firm´s inception. publication, which aims to supply interested parties with the information necessary to make investments in the state. IvanJoão De Pellegrin Paulo - CEO,Fagundes Rio Grande, Foundingdo Sul Development Partner Agency (AGDI)Lia Esposito Roston, Partner Rayes & Fagundes Advogados Associados Rayes & Fagundes Advogados Associados STATES CONTENT 01 ABOUT RIO GRANDE DO SUL 06 02 ORGANIZATION AND DEVELOPMENT 14 03 ESTABLISHED ECONOMY 17 04 NEW ECONOMY 22 05 SUPPORT FOR INVESTMENTS 25 06 INNOVATION AND TECHNOLOGY 27 07 INFRASTRUCTURE 29 08 EDUCATION, SAFETY AND HEALTHCARE 34 09 TOURISM AND CULTURE 37 10 USEFUL CONTACTS 39 11 ABOUT OUR SPONSOR 42 01. ABOUT RIO GRANDE DO SUL Located at the southernmost tip of Brazil, Rio Grande STRATEGIC LOCATION do Sul is the country’s fifth most populous state: it has over 11 million inhabitants living in 497 cities, on a total area of 281,730 km². Its capital city of Porto Alegre is close to other strategic cities: it is Brazil’s closest city to Santiago, Chile, and lies between the cities of São Paulo and Buenos Aires, Argentina. The state is on the border with Uruguay and Argentina, in the exact center of the Southern Cone, just a few hours away from South America’s main markets. View of Porto Alegre, capital of Rio Grande do Sul STATES Credit: Camila Domingues/Palácio Piratini 06 DISTANCES BETWEEN PORTO ALEGRE AND THE MAIN BRAZILIAN AND MERCOSUR CITIES. State Statistic City Km Rio Grande do Sul’s human development index is 0.746, classified as high (the index-ranges goes from 0 to 1). The state comes in Bogota (Colombia) 4,560 km sixth on the Brazilian ranking, standing out for quality of life and Quito (Ecuador) 4,401 km economic development Lima (Peru) 3,330 km Average life expectancy for Rio Grande do Sul’s inhabitants is 75.38 La Paz (Bolivia) 2,289 km years – nearly 2 years more than the national average – according to Santiago (Chile) 1,875 km the 2013 Human Development Atlas of Brazil Brasília (Brazil) 1,623 km *Source: Fundação de Economia e Estatística (FEE) Rio de Janeiro (Brasil) 1,572 km São Paulo (Brazil) 1,119 km The state was listed 9th on the 2014 South American States Buenos Aires (Argentina) 844 km of the Future ranking done by FDI Magazine, a bi-monthly Asunción (Paraguay) 824 km publication produced by the Financial Times group. It is the Montevideo (Uruguay) 712 km third most promising state in Brazil. The survey evaluated economic and social data from 237 states and provinces in State Statistic South America. This table presents Rio Grande do Sul in comparison to the largest states in South America accord- Rio Grande do Sul’s Gross Domestic Product (GDP) grew 5.8% in 2013, reaching ing the evaluated criteria. R$ 310.5 billion in 2013* – nearly three times higher than the national rate The state represents 6.42% of the national GDP City Ranking The state’s agricultural industry earned R$ 20.9 billion in 2011, 9.2% of the Economic Potential 6th Gross Value Added (GVA) th The industry represented R$ 61.2 billion in the GDP, 26.9% of the GVA Human Capital 7 th The service sector contributed with R$ 145.6 billion to the GDP in this period, Infrastructure 8 representing 64% of the GVA Favorable business enviroment 8th Rio Grande do Sul’s industrial growth was 6.8%, ahead of the national average of 1.2%. The petroleum and alcohol refinery, automotive vehicles, rubber and plastic, machinery and equipment, and beverages HISTORY presented the biggest gains The Gaucho territory is made up of a mixture of peoples. 44.3% or US$7.7 billion were how much RS exports increased in 2013. The state was the third largest exporter, with 10.36% participation Initially inhabited by indigenous peoples, little by little in the national total Rio Grande do Sul received waves of immigrants from Rio Grande do Sul’s GDP per capita is R$ 27,813.21 – 15.6% higher than around the world. This occupation began with the Jesuit the national average settlements in the 17th century, which later gave rise to HOW TO INVEST IN RIO GRANDE DO SUL 07 Sete Povos das Missões, a region that became important for the INTERNATIONALIZED ECONOMY state’s economy with its production of yerba mate, leather and cattle. Portuguese Azorean immigrants arrived the following International insertion is a determining factor for the century and were mainly involved in wheat production. state’s competitiveness. Rio Grande do Sul’s foreign trade European immigration was strong throughout the 19th century, chain, represented by the sum of its exports and imports, and Rio Grande do Sul received mainly Germans and Italians, was responsible for 30.7% of the state’s GDP in 2013. but there were also Poles, Africans, Japanese and Spaniards, During this period, exports reached US$ 25.1 billion among other nationalities in different periods. and grew 44.3%, while imports were US$ 16.7 billion DIVERSITY and increased 9.1%. The state was Brazil’s third largest exporter and fourth largest importer. Such a great variety of influences made the state’s economy just as diverse as its culture. Agriculture and the In this context, the state has sought to promote its own transformation industry are sectors that have leveraged businesses abroad and attract foreign investments. From and continue adding to the region’s development, which 2011 to 2013, as part of the Rio Grande do Sul Business also relies on strong participation from the service sector.