Inbound and Outbound seminar - Investing in Brazil

This year marks the 45th anniversary of the establishment of diplomatic relations between China and Brazil. PwC China recently held an Investing in Brazil seminar series in Beijing and Shanghai. PwC China Inbound/Outbound Leader, PwC Brazil Partner and President of Invest São Paulo shared insights on the opportunities and challenges of investing in Brazil. The Brazilian delegate also had group discussions with attendees on the four key investment industries in the fields of agricultural food, health and pharma, food and beverage and infrastructure.

Brazil at a glance

As one of the most important countries in South America, Brazil has always been the land of Chinese companies to explore the South American market. Brazil has the fifth largest land area in the world and is rich in natural resources. Although Brazil is a country with a “great melting pot”, the use of Portuguese as its main language is conducive to promoting national integration and creating a relatively stable social environment. In addition, Brazil has a well-established financial services industry and regulatory environment, creating a good business environment for companies to invest in Brazil.

Business environment

• Economic indicators

The latest economic indicators show that in the past decade, Brazil's economic growth has experienced a slowdown from growth to recession to slow growth. The forecast shows that Brazil's economic growth will be stronger from 2020.

• Trade Balance

According to data from 2018, Asia has become Brazil's largest trade partner. The Brazilian economy is still largely domestically oriented. The scale of foreign trade is expected to expand in the next few years.

• Foreign Direct Investments

In 2018, Brazil attracted foreign investment of US$68 billion, and this figure will climb to US$76 billion in 2022. Foreign direct investment is mainly concentrated in Agribusiness, Infrastructure, Health, Logistics and Utilities.

Challenges

However, investing in Brazil is also facing major challenges, especially Brazil's complex tax system has brought arduous challenges to foreign investors. PwC analysed the main tax considerations for Chinese companies investing in Brazil.