13/09/2018 Presentation title
Brazil – A country of opportunities Paulo Safady Simão CBIC Chair 13/09/2018 Brazil – A country of opportunities
BRAZILIAN CONSTRUCTION INDUSTRY CHAMBER National and international representative of employer associations in the construction and real estate industry 3
26 States and Federal District BRAZILIAN CONSTRUCTION INDUSTRY CHAMBER UNIONS, EMPLOYER ASSOCIANTIONS AND CHAMBERS 62 Associations 26 States and Federal District Highway Construction Sanitation Real Estate Construction Segments 4
Brazil – A country of opportunities GENERAL INFORMATION BRAZIL Brazil – A country of opportunities
RECENT GLOBAL FINANCIAL CRISIS “The stability of the economy and of the country’s democratic institutions as well as frank dialogue between government and civil society were decisive in successfully confronting the crisis” A development strategy based on investment and mass consumption (domestic market) was adopted; and ... Monetary policy Reserve requirement Reduced interest rates Foreign trade (reserves) Fiscal policy Reduced taxes on production Investments in construction são gerados prejuízos de bilhões de dólares comprometendo o funcionamento do sistema financeiro privado. Ocorre uma contração drástica e generalizada do potencial de crescimento nos mercados domésticos. A confiança é comprometida pela fraqueza de fundamentos econômicos, tais como o equilíbrio das contas públicas, alia-se à incapacidade financeira e instrumental dos governos para intervir de forma apropriada.
ECONOMIC OUTLOOK Economic stability; Average growth of approximately 4.7% per year; Growth driven by internal demand and by investments in infrastructure and housing; Investments projected to grow by at least twice the rate of GDP in the coming 4 years; Notwithstanding forecasts pointing to a renewed global downturn, domestic demand remains robust, international reserves and reserve requirements are higher than in 2008, and the fiscal situation is stronger. Source: Ministry of Finance, Brazilian Central Bank (BACEN) and CBIC Database 7
GDP GROWTH RATES In the period 2011-2014, the consolidation of investments (driven by construction) and increased domestic demand is expected to spur average annual economic growth of 4,7%. Source: Brazilian Institute of Geography and Statistics (IBGE). Preparation and estimates by the Ministry of Finance.
MIDDLE CLASS ACCOUNTS FOR MORE THAN HALF OF BRAZILIAN POPULATION DISTRIBUTION OF ECONOMIC CLASSES IN BRAZIL (% POPULATION) Enhanced income distribution has added 29 million to middle class (Class C). Note: Monthly household per capita income by class at 2009 prices: Class A/B: more than R$ 4,800.00; Class C: R$ 1,115.00 – R$ 4,800.00; Class D: R$ 804.00 – R$ 1,115.00; Class E: up to R$ 804.00. Source: Getúlio Vargas Foundation/National Household Sample Survey. Prepared and estimated by the Ministry of Finance
A MIDDLE CLASS NATION COMPOSITION OF BRAZILIAN SOCIAL CLASSES (MILLIONS OF PEOPLE) Source: Getúlio Vargas Foundation/National Household Sample Survey. Prepared by the Ministry of Finance
BRAZILIAN ECONOMY: FORECAST * IMF Forecast Source: Brazilian Institute of Geography and Statistics (IBGE). Preparation and estimates by the Ministry of Finance.
Brazil – A country of opportunities GENERAL INFORMATION CONSTRUCTION Brazil – A country of opportunities
THE CONSTRUCTION INDUSTRY IN CONTEXT Represents approximately 20% of national industrial output; More than 2.8 million formal workers; More than 170,000 licensed companies; Accounts for nearly 41% of fixed investments in Brazil. Source and Preparation: CBIC Database.
GROWTH OF CONSTRUCTION INDUSTRY LABOR FORCE Para cada marco da evolução do emprego falar da participação da CBIC (o que ela fez). Citar a importância do apoio da base, elogio ao SINDUSCON-Maringá e ao seu presidente: Sr. Marcos Mauro. Source: Annual Registry of Social Information/General Registry of Employed and Unemployed Persons (RAIS/CAGED), Ministry of Labor and Employment. Preparation: CBIC Database.
Brazil – A country of opportunities REAL ESTATE MARKET Brazil – A country of opportunities
REAL ESTATE MARKET GROWTH IN REAL ESTATE CREDIT 2002 – 2011 (financing volume) REAL ESTATE MARKET Note: New and used units Source: Brazilian Central Bank (BACEN), Brazilian Association of Real Estate Credit and Savings (ABECIP), and Federal Savings Bank (CEF) – FGTS Channel. CBIC Database.
HIGH QUALITY REAL ESTATE CREDIT Mortgage Guaranty + Fiduciary Lien Brazilian Savings and Loan System (SBPE) – Agreements with more than 3 outstanding installments signed after 1998 Mortgage Guaranty + Fiduciary Lien Fiduciary Lien Source: Brazilian Central Bank and Brazilian Association of Real Estate Credit and Savings (ABECIP)
REAL ESTATE FINANCING AS A PERCENTAGE OF GDP Source: Brazilian Central Bank (BACEN) and Brazilian Association of Real Estate Credit and Savings (ABECIP). Preparation: CBIC Database
CREDIT TRANSACTIONS BY FINANCIAL SYSTEM IN 2009 (AT THE HEIGHT OF THE CRISIS) Steering of funds at low cost was decisive for maintaining credit levels at the height of the global crisis. Source: Brazilian Central Bank (BACEN). Preparation: CBIC Database 19
Brazil – A country of opportunities MY HOME, MY LIFE PROGRAM (PMCMV) Brazil – A country of opportunities 20
MY HOME, MY LIFE PROGRAM (PMCMV) Disbursement of MCMV Program (R$ billion) *Caixa Econômica Federal estimate. Note: Exchange rate: R$ = US$ 0.56 Source: Caixa Econômica Federal. Preparation: Ministry of Finance. 21
ADDITIONAL GROWTH INDICATORS ... 5.81 23.49 Cumulative shortage - 2009 HOUSING NEEDS (millions of units) 5.81 Cumulative shortage - 2009 23.49 2010 - 2022 Source: Civil Construction Industry Trade Union of São Paulo (SINDUSCON-SP), São Paulo State Federation of Industry (FIESP), Getúlio Vargas Foundation (FGV). CBIC Database.
Brazil – A country of opportunities INFRASTRUCTURE Brazil – A country of opportunities
? WHAT IS THE PAC It is a program of consistent investments aimed at meeting the challenges of infrastructure. GROWTH ACCELERATION PROGRAM SECOND PHASE 2011-2014 Source: PAC2 Report.
GROWTH ACCELERATION PROGRAM – SECOND PHASE Source: PAC2 Report.
GROWTH ACCELERATION PROGRAM Organizes government measures and supports private sector action over a 4 year period. Develops an optimal environment to enable the country to grow at a faster rate through the execution of infrastructure studies, projects, and works. Creates the conditions for addressing the obstacles to sustainable development. 26
Brazil – A country of opportunities 2014 FIFA WORLD CUP Stadiums Urban Mobility Ports and airports Environment sanitation Telecommunications Brazil – A country of opportunities
INVESTMENTS FOR THE 2014 FIFA WORLD CUP (R$ billion) Note: exchange rate: R$ = US$ 0.56 Source and Preparation: Ministry of Finance. 28
Brazil – A country of opportunities 2016 OLYMPIC GAMES Environment sanitation Urban Mobility Stadiums and arenas Ports and airports Telecommunications Brazil – A country of opportunities
PORT INVESTMENTS Nine major projects of ports in the world (US$ billion) Note: The expansion of the Port of Santos and the construction of the Açu Port in Rio de Janeiro, the largest venture investiment in port in Latin America. Source: CG-LA ExameYearbook 2011-2012. Preparation: Ministry of Finance 30
INVESTMENT PROGRAM IN TRANSPORTATION Sixteen major transport projects in the world (US$ billion) Source and Preparation: Ministry of Finance. 31
INVESTMENT PROGRAM IN TRANSPORTATION High-speed train linking the cities of Rio de Janeiro, São Paulo and Campinas (R$ billion and % of total) Note: Exchange rate: R$ = US$ 0.56 Source: STN/Ministry of Finance. Preparation: Ministry of Finance 32
INVESTMENT PROGRAM IN TRANSPORTATION Airport concession: Planned investments (R$ billion) Notes: Guarulhos: Brazilian and South African Society – a composite of an English investment fund Viracopos: Brazilian Society with one French partner Brasilia: Brazilian Society with one Argentine partner Exchange rate: R$ = US$ 0.56 Source: STN/Ministry of Finance. Preparation: Ministry of Finance 33
Brazil – A country of opportunities ENERGY Subsalt; Clean Energy; Hydroelectric Plan; Oil and Gas. Brazil – A country of opportunities
INVESTMENTS IN THE OIL AND GAS SECTOR Ten major projects in the Oil and Gas sectors in the world (US$ billlion) Note: If plus ship-oil platforms whith building platforms the total value is US$ 40 billion. Source and Preparation: Ministry of Finance. 35
INVESTMENTS IN THE ELETRICITY SECTOR Fifteen major projects in the Eletricity Sector in the world (US$ billlion) Source: CG-LA ExameYearbook 2011-2012. Preparation: Ministry of Finance 36
INVESTMENT FOR THE COUNTRY´S DEVELOPMENT AND GROWTH Note: Updated in January 2012. Preparation: Ministry of Finance. 37
BUSINESS OPPORTUNITIES OTHERS BUSINESS OPPORTUNITIES Investment in tourism; Commercial buildings – shopping malls, warehouses for logistics; Tecnological Innovation Program 38 38
presidencia@cbic.org.br Phone: +55(61) 3327-1013 www.cbic.org.br presidencia@cbic.org.br Phone: +55(61) 3327-1013 Fax: +55(61) 3327-1393 BRAZILIAN CONSTRUCTION INDUSTRY CHAMBER Paulo Safady Simão CBIC CHAIR
13/09/2018 Presentation title