Overseas Information Country Profile – Brazil Main indicators 2008 2009 2010 2011 2012 Synopsis of the Country Inflation rate (%) 5.7 4.9 5.1e 4.6 4.5 Capital : Brasilia Unemployment rate Currency : Brazilian Real (BRL) (% of the labour force) 8.0 - - - - Official language : Portuguese Current Account Business : Portuguese and Spanish; English is (billions USD) -28.19 -24.33 -55.65e -59.88e -68.53 Languages not used very much Current Account Population : 196342592 (in % of GDP) -1.7 -1.5e -2.9 -2.9 -3.2e Total Area : 8511965 sq. kms GDP : $1.665 trillion (2008 est.) (Source : IMF - World Economic Outlook Database; CIA - The world factbook ) GDP Growth Rate : 5.2% (2008 est.) GDP Per Capita : $10,300 (2008 est.) Note: (e) Estimated data Major Exports : Transport equipment, iron ore, Main sectors of industry soybeans, footwear, coffee, autos Exports Value : $200 billion f.o.b. (2008 est.) Brazil has abundant natural resources and its economy is Major Countries : US, Argentina, China, Netherlands, relatively diversified. of Export Germany A major agricultural power, Brazil is one of the leading Major Imports : Machinery, electrical and transport producers of soya and is the world's first producer of coffee, equipment, chemical products, oil, sugar cane and oranges. It also attracts many world groups automotive parts, electronics Imports Value : $176 billion f.o.b. (2008 est.) in the food industry and biofuels. Brazil has the world's largest Major Countries : UK, Singapore, Malaysia commercial livestock herd. Nevertheless, agriculture's of Import contribution to the GDP is relatively small. Forests cover half Economic Indicators of the country, with the largest ombrophilous forest in the Brazil is one of the top ten world economic powers. The world situated in the Amazon Basin. taxation and monetary policies, cautiously run by President Brazil is also a great industrial country. It benefits from its Lula, together with the necessary microeconomic reforms (which have been ongoing since his new term of office mineral ore wealth and is the second world exporter of iron began in January 2007), have restored confidence in this and one of the main producers of aluminium. The country market, which even though it was affected by the global is asserting itself more and more in the textile, aeronautics, economic crisis, has solid bases. In the eyes of all pharmacy, automobile, steel and chemical industry sectors. international observers, the Brazillian economy is clearly progressing and less and less vulnerable, as its resistance Most of the large automobile manufacturers have set up in the face of the global crisis proved. Additionally, the their production plants in the country. The industrial sector unemployment rate is constantly dropping. However, the contributes to almost a third of the GDP, whereas the government's debt (mainly domestic) is still high, at around 45% of the GDP. Thanks to a trade surplus, the amount tertiary sector represents almost two-thirds of the GDP. of reserves now equals that of the foreign debt at the height of 190 billion dollars. The consumer price index should Breakdown of economic Agriculture Industry Services increase slightly during this year and follow the downward activity by sector trend again in 2010. Employment by sector Main indicators 2008 2009 2010 2011 2012 (in % of total employment) 21.0 21.0 57.9 Value added GDP (billions USD) 1,635.52 1,574.04 1,910.50 2,035.04e 2,161.28e (in % of GDP) 5.5 28.7 65.8 GDP (constant prices, Value added annual % change) 5.1e -0.2 5.5e 4.1 4.1 (annual % change) 5.3 4.9 5.6 GDP per capita (USD) 8,626 8,220 9,886e10,440e10,997e (Source : World Bank - last available data) 22 Engineering Export Info-Bulletin, Vol. 12, Issue No. 30, July 26, 2010 Overseas Information Monetary indicators 2004 2005 2006 2007 2008 Main customers (% of exports) 2009 Brazilian Real (BRL)- 2.93 2.43 2.18 1.95 1.83 Germany 4.0% Average annual Japan 2.8% Exchange rate for United Kingdom 2.4% 1 USD Venezuela 2.4% Foreign trade in figures India 2.2% Brazil is amongst the 20 top world exporters. However, the Belgium 2.1% country still has enormous economic potential. The Italy 2.0% country's main trade partners are the Mercosur (Common South American market which encompasses Argentina, France 1.9% Brazil, Paraguay and Uruguay - website in Spanish or Russia 1.9% Portugese), the United States and China. In 2008, Brazil Mexico 1.7% recorded a trade deficit for the first time since 2002, due to the sharp appreciation of the Real against the dollar, Spain 1.7% which made foreign products cheaper. It is forecasted that Chile 1.7% the trade balance will not stabilize until 2010. South Korea 1.7% Foreign trade indicators 2005 2006 2007 2008 2009 Saint Lucia 1.6% Imports of goods 77,628 95,838 126,560182,367 133,609 Saudi Arabia 1.3% (millions USD) Switzerland 1.3% Exports of goods 118,529137,808 160,649197,943 152,995 (millions USD) (Source: Comtrade) Imports of services 22,409 27,149 34,700 44,396 44,073 Main suppliers (% of imports) 2009 (millions USD) Exports of services 14,856 17,946 22,615 28,822 26,267 United States 15.8% (millions USD) China 12.5% Imports of goods and 8.5 18.3 20.7 18.0 - Argentina 8.8% services (annual % change) Germany 7.7% Exports of goods and 9.3 4.7 6.6 1.0 - services (annual % change) Japan 4.2% Imports of goods and 11.5 11.7 12.3 14.0 - South Korea 3.8% services (in % of GDP) Nigeria 3.7% Exports of goods and 15.1 14.6 13.9 14.0 - Italy 2.9% services (in % of GDP) France 2.8% Trade Balance 44,703 46,458 40.028 24,837 - (miillions USD) Mexico 2.2% Trade Balance 36,394 36,804 26,673 8,147 - Chile 2.0% (including service) United Kingdom 1.9% (millions USD) India 1.7% Foreign trade (in % of GDP) 26.6 26.3 26.2 29.0 - Switzerland 1.6% (Source : WTO - World Trade Organization, World Bank) Spain 1.5% Main partner countries Bolivia 1.3% Canada 1.3% Main customers (% of exports) 2009 Saudi Arabia 1.3% China 13.2% Russia 1.1% United States 10.3% Argentina 8.4% Algeria 1.1% Netherlands 5.3% (Source : Comtrade) Engineering Export Info-Bulletin, Vol. 12, Issue No. 30, July 26, 2010 23 Overseas Information Main products Main exports (% of exports) 2009 Ores, slag and ash 9.4% Mineral fuels, mineral oils and products of their distillation; 9% bituminous substances; mineral waxes Oil seeds and oleaginous fruits; miscellaneous grains, seeds and fruit; 7.6% industrial or medicinal plants; straw and fodder Meat and edible meat offal 6.5% Sugars and sugar confectionery 5.6% Vehicles other than railway or tramway rolling-stock, and parts 5.5% and accessories thereof Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof 5.3% Iron and steel 4.4% Electrical machinery and equipment and parts thereof; sound recorders and 3.4% reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles Residues and waste from the food industries; prepared animal fodder 3.2% Aircraft, spacecraft, and parts thereof 2.7% Coffee, tea, maté and spices 2.6% Pulp of wood or of other fibrous cellulosic material; recovered (waste and scrap) paper or paperboard 2.2% Tobacco and manufactured tobacco substitutes 2.0% Plastics and articles thereof 1.8% Organic chemicals 1.6% Inorganic chemicals; organic or inorganic compounds of precious metals, of rare-earth metals, 1.4% of radioactive elements or of isotopes Preparations of vegetables, fruit, nuts or other parts of plants 1.2% Articles of iron or steel 1.1% Natural or cultured pearls, precious or semi-precious stones, precious metals, metals clad 1.1% with precious metal, and articles thereof; imitation jewellery; coin Source: Comtrade Main imports (% of imports) 2009 Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof 16.5% Mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes 14.8% Electrical machinery and equipment and parts thereof; sound recorders and reproducers, 12.1% television image and sound recorders and reproducers, and parts and accessories of such articles Vehicles other than railway or tramway rolling-stock, and parts and accessories thereof 9.0% Organic chemicals 5.5% Optical, photographic, cinematographic, measuring, checking, precision, medical or surgical 3.8% instruments and apparatus; parts and accessories thereof Plastics and articles thereof 3.8% 24 Engineering Export Info-Bulletin, Vol. 12, Issue No. 30, July 26, 2010 Overseas Information Main imports (% of imports) 2009 Pharmaceutical products 3.5% Fertilizers 3.1% Miscellaneous chemical products 1.9% Articles of iron or steel 1.9% Rubber and articles thereof 1.8% Aircraft, spacecraft, and parts thereof 1.7% Iron and steel 1.7% Cereals 1.4% Inorganic chemicals; organic or inorganic compounds of precious metals, of rare-earth metals, 1.3% of radioactive elements or of isotopes Copper and articles thereof 1.0% Paper and paperboard; articles of paper pulp, of paper or of paperboard 0.9% Tanning or dyeing extracts; tannins and their derivatives; dyes, pigments and other colouring matter; 0.7% paints and varnishes; putty and other mastics; inks Man-made filaments 0.7% (Source : Comtrade) Tax Rates Tax rate for foreign companies Consumption taxes Companies resident in Brazil pay taxes on their worldwide Nature of the tax profits. Foreign companies are only subject to tax if they ICMS : Tax on operations concerning the movement of goods engage in certain sales operations involving companies or and on national, municipal and local transport services.