Rio, September 29, 2003 (Agência Brasil - ABr) - The improvement in the Brazilian macroeconomic environment and in the way the country is perceived abroad, the opposite of the situation that prevailed six months ago, together with expectations for short-term improvements in some of the world's key economies, led the Brazilian Investment Promotion Network (Invest Brazil) to forecast a recovery in the flow of foreign investments to Brazil in 2004, which should attain US$ 14-15 billion. In a declaration made to Radiobrás on Friday (26), in this capital, the director of Invest Brazil, Clementino Fraga Neto, said that the optimism regarding next year is based on the government's economic measures, which are already beginning to produce results, which will help attract investments over the long run.
Invest Brazil released the analysis of Direct Foreign Investment (DFI), based on Central Bank data. The study projects a DFI flow to Brazil this year of US$ 9-10 billion, something like 1.8% of the US$ 600 billion worldwide investment flow estimated for this period. This figure represents a decline relative to the US$ 16 billion registered in Brazil in 2002. The drop accompanies the shrinkage of the world economy, caused by the war in Iraq, the deceleration of the growth rate in developed countries, and stagnation and crisis in the world's major economies.
Among domestic aspects that influence or influenced the DFI flow to Brazil, the following can be cited: the pre-electoral crisis of confidence, expectations over social security and tax reform, the resumption of growth, and China's enhanced strength as an investment pole, among other factors.
Fraga Neto affirmed, on the other hand, that the figures for August signal that the DFI flow to Brazil will stabilize at the level of US$ 1 billion per month. Foreign direct investments in Brazil totalled US$ 980 million, an 11% increase over the same month last year. Since the beginning of the year, however, the cumulative flow amounted to US$ 5.727 billion, 50% less than the US$ 429 billion that entered the country last year over a comparable period. In relation to July, when the DFI flow attained US$ 1.247 billion, August's figure represents a 21% drop, Fraga Neto informed. (DAS)
