2. Brazilian Trade and Investment Promotion Agency Apex-Brasil Brazil Economic Scenario and Investment Opportunities Alessandro Teixeira President

3. Regions FDI Share of FDI inflows in selected regions

4. Latin America’s FDI inflows: Brazilian share FDI in World

5. World Trade Trends  World Trade Flow – acceleration from 2002 onwards

6. World Trade Trends  World Exports 1999 2007

7. World Trade Trends  World Exports – BRICs Growth 1999 2007

8. World Trade Trends  World Imports 1999 2007

9. World Trade Trends  World Imports – BRICs Growth 1999 2007

10. Brazilian new cycle of economic growth  High rates of economic growth: –GDP –Consumption –Investment  Balanced growth;  Based on foreign trade and mass consumption;  Reduction of social and regional inequalities;  Sustainable Growth

11. Sustainable growth Low external vulnerability :  New foreign policy – diversifying trade partners  Trade surplus (US$ 25 billion – 2008)  Current transactions surplus (US$ 3.6 billion - 2007)  International reserves (US$ 190 billion - 2007)  The country became a net foreign creditor (January 2008)

12. Trade flow Source: MDIC US$ 198 bi US$ 173 bi US$ 25 bi

13. Mass consumption – A new middle class appears  Growth of the population’s consumption capacity Expansion of employment and income Increase on minimum wage Credit revolution New social programs Inflation under control Income Class 2002: C = 32%2007: C = 49% Source: DATAFOLHA

14. Employme nt Rate  In Brazil, from 2004 to 2007, 1.41 million new jobs were created each year on average Family income +10.1% +8.8% +7.9% * forecast R$ billion Source: IBGE

15. Family consumption Quarterly growth over the past year’s same quarter 13.6% Sales in commerce  In 2007: 9.68% growth over 2006  Apr 2008: 10.26% growth – 12 month accumulated Source: IBGE

16. Brazil – International Reserves US$ billion Source: Brazilian Central Bank

17. * Forecast GDP growth in Brazil Sources: IBGE, MF/SPE

18. * Forecast GDP growth in Brazil GDP growth – first semester, 2008/2007: 6.0%

19. Brazil - FDI inflows US$ billion 2007: inflows = US$ 34.3 billion 99% growth over 2006 Source: Unctad

20. Brazil and the international crisis  Brazil is now much less vulnerable to external crisis in comparison to the past years: Soundness of external accounts; Fiscal balance and public debt reduction Inflation under control Growth sustained by domestic demand  Even though Brazil is not immune to crisis, impacts are limited.

21. Foreign confidence in Brazil  This year, Standart & Poor’s raised its rating on Brazil to Investment grade. “Lowering inflation, a stable political situation and a raft of interesting mid and small- cap companies is driving increased investor interest in Brazil - making it one of the more attractive emerging markets for 2008.” “There has been a lot of money flowing into Brazil in recent years and an increased demand for stocks. In terms of the growth and opportunities available, Brazil is an interesting country for investment.” Financial Times – Feb 26, 2008

22. USA-Brazil Trade  USA is Brazil’s main trade partner: –14 % of Brazilian exports went to USA in 2008 –14,9 % of Brazilian imports came from USA in 2008 USA-Brazil Trade Flow

23. Investment Opportunities  Aeronautics  Biotechnology  ICT  Infra-structure (“PAC” and PPP)  Tourism and Real State  Biofuels  Oil and Gas Main Sectors:

24. PAC – Growth Acceleration Program Large investments being made in infrastructure: Highways Energy Transportation Raise productivity Boost economic expansion and job creation Stimulate private investment Housing Urbanization and sanitation Oil & Gas

25. PAC – Growth Acceleration Program  Facts and figures US$249 billion of investments from 2007 to 2010 Target annual GDP growth: 5%

26.  Brazil is the world largest biofuels producer;  In 2007, Brazilian ethanol internal consumption reached 16.7 billion litters, and ethanol exports totalized 3.4 billion litters;  Brazil represents 33.2% of ethanol global production, and 37% of global exports;  In Brazil, biofuels have already reached competitiveness with fossil fuel/petroleum;  In 2007, “flexfuel” vehicles sales rose 40% over 2006, and represented 86% of total sales of automobiles this year. Biofuels – Brazil as a key player High growth of energy demand Opportunity for biofuels

27.  Apex-Brasil promotes investment attraction to Brazil, specially major capital inflows, contributing to Brazilian competitiveness and exports. Apex-Brasil – Investment Promotion

28. Main Activities Organization of missions to potential investors Participation in fairs and events in Brazil and abroad Promotion of workshops and seminars Visits to companies and distribution chains Coordination of Business Rounds Participation in Entrepreneurial Missions One-stop Shop

29. Thank you! Tel.: 55 (61) 3426.0202 Email: apex@apexbrasil.com.br Website: www.apexbrasil.com.br