Person of the Year Awards - The Brazilian

Transcription

VOL. 41 / NO. 3 • MAY / JUNE 2006
2006
Person of the Year Awards
Carlos Geraldo Langoni,
President of Fundação
Getúlio Vargas; Brazilian
Person of the Year Roger
Agnelli, President and
CEO of Companhia Vale
do Rio Doce; and
Richard Aldrich, Jr.,
President of the BrazilianAmerican Chamber of
Commerce, Inc.
Former U.S. Ambassador
to Brazil Anthony
Harrington; American
Person of the Year
Paul M. Anderson,
Chairman and CEO of
Duke Energy; and
Richard Aldrich, Jr.,
President of the BrazilianAmerican Chamber of
Commerce, Inc.
Continued on page 23
IN THIS ISSUE
» Person of the Year Award Ceremony___1
» Brazil’s Sports & Entertainment
Industry ____________________3-15
• From the Editorial Committee
Chairman_____________________3
• Realizing the Business Potential
of Brazilian Soccer ______________3
• Pan American Games Rio 2007___5
• Emotion-Based Sports Marketing ___6
• Brazilian Music & Entertainment News _7
• Brazil’s Music Industry Faces New
Challenges ____________________8
• Recent Victories in Brazil’s
Anti-Piracy Crusade_____________9
• The Future of Brazil’s Music
Industry _____________________11
• The Digital Television Revolution
in Brazil ____________________12
• Top 20 CDs/DVDs in Brazil: 2005 _13
» Economy _____________________16
» International Trade ______________19
» Political Scenario _______________22
CHAMBER NEWS
»
»
»
»
Photo Gallery _______________24-41
New Members _________________42
Corporate Profiles_______________43
Calendar of Events ______________48
BRAZILIAN
AMERICAN
DIRECTORS
CHARLES ACHOA, JR.
Credit Suisse
RICARDO DE FIGUEIREDO LIMA
RAUL SANTORO DE MATTOS ALMEIDA
Banco Bilbao Vizcaya Argentaria
CHAMBER OF COMMERCE, INC.
JOÃO LAURO AMARAL
BM&F – Brazilian Mercantile & Futures
Exchange
PRESIDENT EMERITUS
VICENTE J. BONNARD
OFFICERS
PRESIDENT
RICHARD S. ALDRICH, JR.
TREASURER
JAMES J. QUINN
SHEARMAN & STERLING LLP
LAW/CPA OFFICES OF JAMES J. QUINN
VICE PRESIDENT
LÚCIO PIMENTA
SECRETARY
JOSÉ W. FERNANDEZ
LATHAM & WATKINS LLP
ADVISORY COUNCIL
H.E. JOSÉ ALFREDO GRAÇA LIMA,
Honorary Chairman
Consul General of Brazil
JOSÉ ROBERTO DAVID DE AZEVEDO
FRANCISCO R. GROS
SERGIO MILLERMAN
SÉRGIO C. PEREIRA
GABRIEL R. SAFDIÉ
CELSO V. BARISON
TONY E. SAYEGH
LINO OTTO BOHN
CARLOS ALBERTO VIEIRA
VICENTE J. BONNARD
PATRON MEMBERS
BANCO BRADESCO S.A.
BANCO DO BRASIL
PETRÓLEO BRASILEIRO S.A.—
PETROBRAS
SPONSOR MEMBERS
AMERICAN INTERNATIONAL GROUP – AIG
CITRUS PRODUCTS, INC.
BANCO DA AMAZÔNIA S.A.
CREDIT SUISSE
BANCO ITAÚ S.A.
DEUTSCHE BANK
BANCO VOTORANTIM
HSBC PRIVATE BANK
CACIQUE INTERNATIONAL U.S.A., INC..
SHEARMAN & STERLING LLP
CITIGROUP GLOBAL MARKETS, INC.
UNIBANCO —
UNIÃO DE BANCOS BRASILEIROS S.A.
Newsbulletin
C H A I R M A N , E D I T O R I A L A N D P U B L I C AT I O N S C O M M I T T E E :
EDITOR:
Christopher Buettner
KELLIE A. MEIMAN
Kissinger McLarty Associates
EDISON ANTONELLI
Banco Bradesco S.A.
RENATA NEESER
PAUL S. AUFRICHTIG
Aufrichtig Stein & Aufrichtig, P.C.
ROBERTO DE PAULA
McCann WorldGroup
XL Generation
Royal Consulting, Inc.
ANTONIO BANDEIRA
PAULO SERGIO PEREIRA
CELSO V. BARISON, JR.
Metropolis Wine Merchants
CARLOS ALBERTO ANDRADE PINTO
Sucafina U.S.A. Inc.
VALMOR A. BRATZ
Jardim Botanico Partners
RICHARD PRAGER
JAYME F. BULCÃO
BCP Securities LLC
Bank of America
PAUL A. BURKHARDT
Citrus Products, Inc.
PricewaterhouseCoopers, LLP
EDUARDO PUPO
THERESE J. RABIEH
ARTHUR E. BYRNES
Deltec Asset Management LLC
JOSÉ SALES FILHO
JOHN G. CASALE
New York Stock Exchange
ALEXANDER SEVERINO
TAM Airlines
Citigroup Global Markets Inc.
PAULO VIEIRA DA CUNHA
ARIEL SIGAL
HAMILTON C. DA SILVA
MOSES DODO
WestLB AG, New York Branch
American International Group – AIG
JOSÉ LUIZ GODOY
Multiplas International, Inc.
Globo International (N.Y.) Ltd.
CARLOS NOVIS GUIMARÃES
Inter-American Development Bank
Bras Consult Ltd.
THEODORE M. HELMS
Petróleo Brasileiro S.A. – PETROBRAS
Stebbings and Associates
AMAURI SOARES
ANGELO A. STABILE
ROBERT Y. STEBBINGS
RENATO M. TICHAUER
MORRIS KALEF
Bunge Limited
Shine International Corporation
JOHN H. WELCH
Lehman Brothers
VICENTE B. WRIGHT
FRANCIS E. LARKIN
Aliança Lines, Inc.
RIO DOCE AMERICA, INC.
Bear, Stearns & Co. Inc.
MÁRCIO M. MOREIRA
JOHN D. LANDERS
Delta National Bank and Trust Company
BANK OF AMERICA
JOSEPH LOCANDRO
RUBENS V. AMARAL, JR.
Banco Latinoamericano de
Exportaciones, S.A. - (BLADEX)
STEPHEN M. CUNNINGHAM
Deutsche Bank
CYRIL S. DWEK
UniverCidade – Centro Universitário da
Cidade
Rio Doce América, Inc.
PAULO LEME
Goldman Sachs and Co.
RONALD LEVY
Globus Coffee LLC
Peter D. Aufrichtig
P R O D U C T I O N C O O R D I N AT O R :
Kevin Penzien
EXECUTIVE DIRECTOR
SUELI CRISTINA BONAPARTE
EXECUTIVE EDITOR:
R E S E A R C H A S S O C I AT E :
Sueli C. Bonaparte
Emily Oka
Newsbulletin is published bi-monthly by the Brazilian-American Chamber of Commerce, Inc. Opinions expressed in Newsbulletin are not necessarily those of the Chamber. The Editorial Committee reserves the
right to refuse materials submitted. Editorial materials are subject to change. All correspondence must be addressed to: Brazilian-American Chamber of Commerce, 509 Madison Avenue, Suite 304, New York,
NY 10022. We welcome suggestions, comments, and news articles related to Brazil–US trade relations. Tel: (212) 751-4691 • Fax: (212) 751-7692 • E-mail: [email protected]
3
Sports & Entertainment in Brazil
From the Editorial Committee Chairman
n this issue of NewsBulletin, we
turn our attention to Brazil’s sports
& entertainment industry. All eyes
were squarely on the seleção at this
summer’s World Cup in Germany.
While France ended Brazil's all-time
record streak of 11 straight World
Cup match wins, Ronaldo did
become the all-time leading scorer in
World Cup history at this year’s event.
From an economic perspective,
Brazilian soccer has indeed
become a big business. The national
team has inked lucrative sponsorship deals with domestic and
international companies such as
Nike, Ambev, Varig, Vivo and others.
But soccer is just one segment in
Brazil’s burgeoning sports and
I
entertainment industry. This issue
features articles on a wide array of
topics, including sports marketing,
digital television, the nation’s
music industry, anti-piracy efforts,
and – of course – the business of
Brazilian soccer.
We are also proud of our worldclass line-up of guest contributors
for this edition’s columns on
Brazilian trade, politics and finance.
Our special thanks to Paulo Skaf,
President of FIESP; Thomas Trebat,
Executive Director of the Institute for
Latin American Studies at Columbia
University; Bolivar Lamounier,
Senior Partner at Augurium
Consultoria; and Gray Newman,
Senior Economist for Latin American
Economics at Morgan Stanley, for
their contributions.
We hope you enjoy this edition of
NewsBulletin and we look forward to
your comments and suggestions for
future editions. In our next issue, we
will provide in-depth coverage on the
upcoming elections in Brazil and their
potential impact on the business and
financial sectors. ■
Peter Aufrichtig
Editorial Committee Chairman
Realizing the Business Potential of Brazilian Soccer
he Brazilian government needs
to intervene in Brazilian Soccer
in order for the industry to realize
its full economic potential. Such
an assertion probably sounds insane
for those that defend liberal
economic theory in which the
market should remain as free from
regulation as possible.
But, for Oliver Seitz, the first
Brazilian professor to teach a course
on the global soccer industry at the
University of Liverpool, government
intervention is exactly what’s needed
for Brazilian Soccer to grow from a
business perspective.
In a recent interview with
Brazilian publisher Máquina do
Esporte, Seitz affirms that Brazil,
when compared to the UK, is still in
a pre-Margaret Thatcher stage when it
comes to the development of soccer
as a viable industry within the nation’s
sports & entertainment sector.
“The relationship between
soccer and the state is still at a very
T
www.brazilcham.com
primitive level,” he says. Once the
government decides what the purpose and appropriate role of the
existing soccer clubs should be,
private and public sector leaders can
begin to think about how best to
structure and modernize the industry
to increase its profitability and its
contribution to the Brazilian economy
as a whole.
Q: What is the perception of
soccer industry professionals
abroad in terms of the management
of Brazilian soccer?
Oliver Seitz: The management
of Brazil’s domestic soccer industry
is almost entirely obscured by the
performance of the national team
and by Brazilian players in professional leagues abroad. Very little
importance is given to what goes on
within Brazil. The focus is on the
performance of Brazilian players
internationally. As a result, soccer
industry professionals outside the
country only learn about the most
[email protected]
notorious aspects of Brazilian soccer,
such as parliamentary inquiries and
irregularities around the refereeing
of the 2005 Brazilian Championship.
Brazil is seen as a vast source of
talented players, but also as a place
where professional soccer is in a
decidedly chaotic state. And in
reality, that perception is not far
from the truth.
Q: English soccer began to be
seen as a big business after the
Taylor Report at the beginning of
the 1990s. Comparatively, in what
stage of business development would
you classify Brazilian soccer in comparison to its English counterpart?
OS: The Taylor Report certainly
wielded a great deal of influence on
the development of English soccer,
but there were also several other
factors that helped create the industry
as we know it today. When the
English clubs were banished from
European championships after the
Continued on page 4
MAY / JUNE 2006 / VOL. 41 NO. 3
Brazilian-American Chamber of Commerce, Inc. – NEWSBULLETIN
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REALIZING THE BUSINESS POTENTIAL OF BRAZILIAN SOCCER Continued from page 3
Heysel tragedy [a conflict between
fans of Liverpool and Juventus at
the 1985 final of the European
League of Champions in which 39
Italians were killed], they had to
began maximizing the commercial
value of soccer at home in England.
In addition, the development of
the TV Network SKY had a huge
impact on the business. To encourage British soccer fans to buy
satellite antennas and subscribe to
the paid programming, the new
network offered a vast amount of
money to acquire a monopoly on
broadcasts of Premier League
games. As a result, English soccer
witnessed an unprecedented injection of financial resources into the
industry. Because of the strident
fiscal demands of the government,
clubs had to adopt a much more
professional organizational structure. While there is already a great
deal of money invested in Brazilian
soccer, the relationship between
soccer and the state is still very
primitive and the operational
structure of clubs is still weak.
Q: Can Brazilian soccer clubs
adopt the British model of management as a way to restructure and
modernize their organizations?
OS: More or less. While more
efficient and self-sustaining, the
British model is far from perfect.
The biggest lesson to be learned
from the English clubs is fiscal
responsibility. But there are major
problems with English soccer as
well, primarily when it comes to
relations between clubs and the community. It would be a major mistake
to assume that the adoption of the
British model would be the salvation
of Brazilian soccer clubs. In fact,
many critics of English soccer are
proposing that the nation’s soccer
industry transition to the Spanish or
German models, which are more
MAY / JUNE 2006 / VOL. 41 NO. 3
democratic and foster greater ties
with fans.
Q: Given the indebtedness of
many Brazilian clubs, can Brazil
ever become a soccer powerhouse
from a business perspective?
OS: It can, but only when Brazil
itself realizes its full economic
potential. It is difficult for a sports
industry in an emerging market to
overcome the domestic macroeconomic situation. It does nothing for
a soccer club to develop a huge
catalogue of licensed products if
there isn’t anyone to buy them.
Unfortunately, Brazil still suffers
from many economic and social woes,
and its soccer industry is limited to
a certain extent by that reality.
However, Brazilian soccer does have
the capacity to grow far beyond its
present state.
The first thing that must happen
is for the Brazilian government to
decide what the nation’s soccer clubs
can and cannot do from a fiscal and
regulatory perspective. Brazilian
soccer clubs enjoy what is described
in economic jargon as Moral Hazard
(Editor’s Note: Moral hazard means
that people with insurance may take
greater risks than they would otherwise because they know they are
protected). In other words, the
nation’s soccer clubs go largely
unchecked because the government
has turned a blind eye at its transgressions in many instances. The
clubs’ substantial public and political
clout have no doubt contributed to
this fact.
Q: Should Brazil adopt the
Premier League’s management
model?
OS: No. The entire organizational structure of professional soccer
in Brazil is highly political. As a
result, I don’t believe that the same
model can be applied. They are two
completely different scenarios.
[email protected]
Furthermore, for the Premier League
model to work, Brazilian clubs
would need to gain more power visà-vis the Brazilian Soccer Federation
(CBF). When the Premier League
was created, the large English clubs
were able to capitalize on a very
complex situation to gain power.
For a long time, the English Soccer
Federation had been embroiled in a
dispute with the Football League,
which at the time was the entity
responsible for all aspects of professional soccer in England. The
English Federation took advantage
of the dramatic changes taking place
in the British economy in the early
1990s to help create the Premier
League. Over time, the Federation
lost considerable power to the
Premier League. The English
Federation’s role is now relegated to
oversight of the national team, refereeing and the development of amateur soccer in England. And there is
already a movement gaining momentum in England for the major soccer
clubs to take over the responsibility
for the national team, pushing the
English Federation further into a
corner. I don’t foresee this happening in Brazil, at least in the short-tomedium term.
Q: To what degree has the
Brazilian media hindered the
development of soccer as a viable
business?
OS: The migration of soccer
broadcasts to cable TV and pay-perview worries me. Because of Brazil’s
economic scenario, there aren’t
many Brazilians who can afford the
luxury of subscribing to a pay TV
service to keep up with their favorite
teams. This is no doubt a complex
issue and merits further debate. ■
By Erich Beting of MBPress
in São Paulo
www.brazilcham.com
5
The Pan American Games Rio 2007
Taking a Closer Look at the Potential Economic Impact of the Games
nternational sports competitions
have become major productions
that spark strong interest from
the general public, the media and
sponsors alike. Today, sports and
entertainment walk hand in hand.
Mega-events such as the Olympics
and the Pan American Games provide
a wide range of opportunities for
different segments of society.
We are a little more than a year
away from the Opening Ceremony of
the Pan American Games Rio 2007.
Now more than ever, the Organizing
Committee and the Brazilian
Olympic Committee firmly believe
that this event will have a significant
impact on the city of Rio de Janeiro,
Brazil and sports in the Americas.
The Organizing Committee of the
XV Pan American Games Rio 2007
has been making every effort to provide a world-class backdrop for this
multi-sport event. The municipal,
state and federal administrations are
making significant investments in
the construction and remodeling
of competition sites and city infrastructure, as well as procuring the
necessary equipment and training
the workforce.
I
The municipal, state and
federal administrations
are making significant investments in the construction and
remodeling of competition
sites and city infrastructure in
order to ensure the success of
the Rio 2007 Games.
Sport also provides an opportunity for players in the public and
private sectors to form strategic
partnerships. The construction of the
Pan American Village follows this
concept by involving both public and
www.brazilcham.com
private sector interests in order to
complete the mega-project in an
efficient manner while also generating profit for the parties involved. It
is a private-sector project supported
The massive building and
infrastructure development
project will yield a significant
legacy, not just for
Rio de Janeiro but for
Brazil as a whole.
by the municipal and federal authorities. To illustrate the success of this
venture, the nearly 1,500 apartments
that comprise the Pan American
Village were all sold during the first
month in which they were offered
last year, becoming one of the most
successful case studies in Brazilian
real estate history.
Rio 2007 will spur the creation
of more than 2,000 jobs, not to
mention the myriad retail and
service-sector positions that will be
created as a result of the event. In
addition, the Rio economy has
already benefited from the thousands
of jobs created in the construction
sector in order to build the necessary
infrastructure and venues for the event.
Rio 2007 is not the first sports
industry event to wield a significant
economic impact on the local economy. The 2nd Pan American Sports
Marketing and Business Conference
– organized by the Brazilian Olympic
Committee (BOC) – generated
US$100 million in revenues.
Since 2002, when Rio de
Janeiro won the right to host the Pan
American Games, the local, state
and federal governments have been
working hard to prepare for the
event. The three levels of government have joined forces and are fully
[email protected]
committed to the refurbishment and
construction of the venues needed
for the competitions. The massive
building and infrastructure development projects will yield a significant
legacy, not just for Rio de Janeiro
but for Brazil as a whole. As a result
of the 2007 Games, Brazil will be
fully prepared to host other large
international competitions. The
World Judo Championship, for
example, will take place in Rio de
Janeiro in September of next year.
Rio was successful in its bid for the
World Judo Championship as a
direct result of the Pan Am Games.
The championship will take place at
the new Multi-sport Arena, and the
Pan American Village will house all
of the athletes.
As a result of the 2007 Pan
American Games, Brazil
will be fully prepared to host
other large international
competitions such as the 2007
World Judo Championship.
The federal government has a
major role in Rio 2007. The administration is in charge of the supporting
infrastructure at the Pan American
Village. It is also responsible for
security at the Games as well as the
necessary information technology.
In addition, Brasília will fund the
production costs for the Opening and
Closing Ceremonies as well as the
construction of the Deodoro Sport
Complex, which will include a stateof-the-art facility for the equestrian
events. The new complex will also
include a National Center for
Shooting Events built in accordance
with Olympic standards as well as
MAY / JUNE 2006 / VOL. 41 NO. 3
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Emotion-Based Sports Marketing
our brand can be tattooed on the
soul of consumers if you make
an emotional connection with them.
And sport can be an extremely
effective vehicle for making just such
a connection.
In Italy, where soccer mobilizes
the masses, just as it does in Brazil,
businesspeople consolidate their
empires by leveraging the power of
sports to connect with consumers.
Silvio Berlusconi, ex-Prime
Minister, has a media and insurance
empire, but is also the owner of AC
Milan. The Agnelli family, known
around the world for its controlling
stake in Fiat, also owns Juventus.
One of the most successful footwear
makers in the world, Diego Della
Vale, is on the advisory board of
Ferrari and also owns Fiorentina.
In Brazil, entrepreneurs will
follow the same route when they
realize that the best byproduct of
soccer – and other popular sports –
is emotion. Integrating sports with
Y
the strategic marketing of your brand
can allow you to gain a competitive
edge over your competition.
Soccer is a particularly
effective vehicle for
connecting with consumers
on an emotional level.
Marc Gobé, author of the book
“Emotional Branding” affirms that
“brands are chosen because of the
emotional impact they have on the
public.” Today’s astute consumers,
equipped with broadband and
mobile technologies, are continually
exchanging information. As a result,
they can be quickly saturated by the
emotion that resides in a product.
Consumers continue to value
design, the quality of the product or
service, as well as the prestige of the
brand. But now they want more.
They want to feel a deep emotional
connection when exposed to the
brand.
Soccer is a particularly effective
vehicle for connecting with consumers on an emotional level. This is
not just because we are still riding
high from the World Cup action in
Germany this summer, but because
soccer is a sport with truly global
reach and one that invokes a strong
sense of local, regional and national
pride in its fans.
By joining the emotion of
sports with brands, we are meeting
the expectations of 21st century
consumers. That emotional connection can help differentiate your
products and services from the
competition at the moment purchase
decisions are made. ■
By Marco Roza, Marketing
Specialist and Director of Marco
Direto Marketing
Source: Máquina do Esporte
Contributing Writers Wanted:
2006 Topics for Newsbulletin Articles
July/August: The 2006 Elections
September/October: The Politics of Trade Negotiations: Accomplishments and Challenges
for Brazil Half Way through the First Decade of the 21st Century
November/December: A Look Ahead: The Top 5 Emerging Industries in Brazil
If you would like additional information or want to place an ad in any of these issues, please
contact Kevin Penzien at (212) 751-4691 or via email at [email protected].
MAY / JUNE 2006 / VOL. 41 NO. 3
[email protected]
www.brazilcham.com
7
Brazilian Music & Entertainment News
Mastercard Close to Signing
Sponsorship Deal with Brazil’s
National Team
(MBPress, São Paulo – June 24,
2006) Mastercard could be the next
official sponsor of the Brazilian
Soccer Federation (CBF). According
to the newspaper “Lance!,” CBF
should announce the deal with
Mastercard in the next few weeks.
The newspaper reports that
Mastercard will pay the Brazilian
Federation US$10 million (R$22.31
million) per year for the sponsorship
over an eight-year period. Mastercard,
which lost its official sponsorship of
the World Cup to rival Visa, would
join with Ambev, Nike, Vivo and
Varig as official sponsors of the
Brazilian team.
Lower House of Congress to
Reexamine TV and Radio
Concessions
(Folha de São Paulo – June 20,
2006) Dep. Vic Pires Franco (PFLPA), the president of the Science,
Technology, Informatics and
Communications Committee of the
Lower House of Congress, recently
announced the creation of a subcommittee headed by Luiza
Erundina (PSB-SP) to reexamine the
process for awarding TV and radio
concessions in Brazil.
According to Pires Franco, the
Senate currently just ratifies decisions
already made by the Executive
Branch. “By the time it reaches our
hands, our only real option is to
approve – or reject – the concessions
outright without knowing who is
who,” he says.
In three and a half years, Lula
has approved 110 educational stations
(29 TV stations and 81 radio stations).
However, at least one out of every
three of the new stations is directly
linked to foundations with overt
www.brazilcham.com
political ties. And many of these
foundations exist on paper only.
Crisis in Brazilian Volleyball
(Máquina do Esporte site – June
2006) A new crisis has emerged in
Brazilian volleyball. During the
finals of the women’s Superliga this
year, many of the participating teams
rejected the rankings. In addition,
most teams denounced the stated
criteria governing which games are
broadcasted on TV. The league’s current organizational structure clearly
favors teams from Rio de Janeiro
and Finasa. And the sponsors of
those teams are demanding expanded
network television coverage during
the upcoming season.
In men’s volleyball, teams such
as Banespa and Cimed have also
made extensive demands that are
causing rifts in the league. To
sidestep an even larger crisis, the
Brazilian Volleyball Federation
(CBV) has given the volleyball
clubs greater latitude in debating
and restructuring the ranking system.
Additionally, the federation is also
courting a new network TV partner
to make the broadcast schedule
more democratic. TV Bandeirantes
is the primary target of CBV’s
efforts, since the network already
broadcasts the Banco do Brasil
beach volleyball circuit together
with Bandsports.
Negotiations on Digital TV
End in Impasse
(Correio da Bahia – June 20,
2006) Brazilian consumers will need
to wait at least two more years to
buy a digital TV and view programming via a new system that will
deliver a higher-quality audio and
visual experience. That is the opinion
of the Brazil representative for the
Japanese negotiation team, Yasutoshi
[email protected]
Miyoshi, who is participating in
ongoing discussions in Brasília.
Differences between the Brazilian and
Japanese negotiators over combining
the Japanese digital TV standard
with technological innovations
developed in Brazil have created an
impasse in the talks.
The 15-person Japanese negotiation team insists on conducting a
feasibility study that could take 6-12
months in order to determine if it will
be possible to merge the Brazilian
technology with the Japanese digital
TV standard. The Brazilian government, for its part, wants the Japanese
to agree to the hybrid solution up front.
Brazilian TV Production
Companies Export Programming
(O Estado de São Paulo – June
20, 2006) Independent production
companies in Brazil are gaining the
attention of international networks
and producers. In the last two years,
Brazilian companies have signed
contracts totaling US$25 million
with companies such as the
Discovery Channel and the Cartoon
Network to produce and sell TV
programming, documentaries and
animated content abroad.
Independent production activities
in Brazil have been bolstered by a
program aimed at increasing the
exports of the nation’s small and
mid-sized film companies. ABPITV,
the Brazilian Association of Independent TV Production Companies,
came up with the original idea for
the program. It was subsequently
implemented by Sebrae (a federal
agency aimed at supporting micro
and small businesses), Apex (the
government’s export promotion
agency) and Promoex (a company
that prepares Brazilian firms for
foreign trade activities).
MAY / JUNE 2006 / VOL. 41 NO. 3
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Brazil’s Music Industry Faces New Challenges
he music industry suffered a
downturn in 2005, not only in
Brazil but around the globe. Brazil’s
music market generated R$615.2
million in sales revenue in 2005
according to data provided by the
major labels to the Brazilian
Association of Record Producers
(ABPD). This represents a 12.9%
decline in comparison to the previous
year. In terms of units sold (52.9
million), the drop was even more
dramatic at 20%. These statistics
reflect sales of music CDs, DVDs
and VHS recordings.
Despite the negative numbers,
Brazil rejoined the ranks of the top
ten markets for music sales in 2005.
According to Paulo Rosa, General
Director of ABPD, Brazil’s return to
the top 10 global markets for music
sales was due first and foremost to
exchange rate fluctuations (i.e., a
stronger real vis-à-vis the US dollar),
rather than a fundamental improvement in Brazil’s music sector.
In the CD segment, sales were
down 12.5% in terms of revenue and
21.7% in terms of units sold (gross
sales minus returns) in 2005. Music
DVDs represented 25.2% of all sales
in Brazil’s music industry last year.
For their part, DVD sales were down
14.1% in terms of gross revenue and
9.6% in terms of units sold.
Paulo Rosa believes this negative result is due to a number of
factors, including:
● A substantial increase in
pirated DVDs
● Stagnant demand in the
domestic market
● Increasing competition from
other forms of media and
entertainment.
“Brazil’s legitimate music
industry is also contending with an
increase in online piracy, primarily
through the illegal sharing of digital
music files,” Rosa added. Rising
T
MAY / JUNE 2006 / VOL. 41 NO. 3
Total Music Sales in Brazil
(in millions)
Year
(in R$)
(in units)
2004
$706
66
2005
$615.2
52.9
% Change - 12.9%
- 20%
CD Sales in Brazil
(in millions)
(in R$)
(in units)
Year
2004
$526
59
2005
$460.5
46.2
% Change - 12.5% - 21.7%
DVD Sales in Brazil
(in millions)
(in R$)
(in units)
Year
2004
$180
7.3
2005
$154.7
6.6
% Change - 14.1%
- 9.6%
computer sales, combined with the
growing penetration of broadband
access in the Brazilian market, has
made the conditions for such forms
of piracy increasingly favorable.
Brazil’s music industry will have to
take this problem very seriously if it
wants the legal music download segment to flourish in the near future.
Despite lackluster sales
figures, Brazil improved its
global ranking in 2005,
moving into the top ten
markets for music sales
worldwide.
While a number of new online
e-commerce sites for music were
launched in 2005, statistics are still
in short supply when it comes to
online music sales in Brazil. “While
in more developed markets, sales
from legal music downloads have
helped offset the decline in the sale
of CDs and DVDs, Brazil’s music
market – like that of many other
[email protected]
emerging markets – is still not seeing a significant volume of sales
from this channel,” says Rosa.
Nonetheless, he expects revenue
from legitimate music downloads
via the Internet to increase in 2006.
As more players enter this market
and the volume of tracks consumers
have to choose from online grows,
the trend toward Internet music
sales will only accelerate.
Music Sales Down Worldwide
Music sales (both physical and
digital) fell 3% worldwide in 2005.
Sales totaled US$21 billion in terms
of revenue generated for the music
labels. As for retail sales volumes, the
global music market stood at approximately US$33 billion last year.
The record labels saw their
revenue from digital sales triple in
2005, growing from US$380 million
in 2004 to US$1.1 billion in 2005. The
total volume of singles downloaded
legitimately either online or to cell
phones increased from 160 million
units in 2004 to 454 million last year.
The US, Japan, the UK, Germany
and France are the five largest digital
music markets. In general, the countries with the largest percentages of
digital sales are the strongest music
markets overall.
CD Sales in Brazil (by genre)
The Pop/Rock category gained
ground in Brazil’s domestic music
market in 2004, while sales of religious music declined. Sales of other
genres remained essentially flat in
comparison to previous years.
Where Brazilians Buy their Music
Specialized music stores are still
the number one destination for Brazilian consumers interested in purchasing
music, followed by department stores
and supermarkets. ■
Source: ABPD
www.brazilcham.com
9
Recent Victories in Brazil’s Anti-Piracy Crusade
razil’s Receita Federal (RF), or
Federal Revenue and Customs
Administration, seized more than
3.6 million CD-Rs and DVD-Rs in
the second half of May 2006 in
Itajaí (SC), bringing the total for the
year to more than 11 million units in
Itajaí alone.
The investigation began in
September 2005 with the Operação
Muralha at the Port of Santos in São
Paulo state. In a period of only
eight months, a São Paulo company
had become the largest Brazilian
importer of blank DVDs and CDs –
the primary raw material for pirating
recorded music. In December of last
year, 7.4 million CDs, bound for the
same SP company, were seized.
“The declared value of the
imports did not even reach the
production costs of the CDs and
DVDs,” says Jackson Aluir Corbari,
a RF representative in Itajaí. The
merchandise seized has an approximate value of R$14 million in the
domestic market.
The investigation, which is part
of the ongoing Operação Muralha,
has the support of the customs workers at the Port of Santos in São Paulo
and the special procedures team of
the Port of Paranaguá in Paraná.
B
Background on Brazil’s
Anti-Piracy Efforts:
In 1995, the Council Director of
the Brazilian Association of Record
Producers created APDIF – the
Brazilian Association for the
Protection of Intellectual Property
Rights in the music industry. APDIF
is a non-profit organization whose
Seized material
Recorded CDs
Blank CDs
Recording Drives
Persons Convicted
www.brazilcham.com
The Effects of Piracy on Brazil’s Music Industry: (1997-2004)
Formal Employment in Music Industry
Signed Artists
Number of Points of Sale Closed
National Record Launches
Estimated Loss of Tax Revenue
from Pirated Music Recordings
Number of jobs lost in the sector
- 50%
- 50%
2,500
- 44%
R$ 500 million per annum*
60,000 (labels, manufacturers,
retail sales positions, etc.)
* Only considering the ICMS (state-level value-added tax on goods and services),
PIS (a tax levied on the gross receipts of Brazilian companies) and Cofins (a tax to
finance social security in Brazil).
mission is to combat the illegal
reproduction of music recordings.
APDIF, through its research and
legal divisions, works to bring producers of falsified recordings to justice
and to destroy the pirated materials.
In addition, the organization also
works in close partnership with the
Total Blank and
Recorded CDs Seized
(July-December 2005)
State
1. São Paulo . . . . . .10,810,499
2. Paraná . . . . . . . . . .3,827,912
3. Rio Grande do Sul .970,366
4. Rio de Janeiro . . . . .539,583
5. Ceará . . . . . . . . . . . .320,000
6. Bahia . . . . . . . . . . . .273,731
7. Alagoas . . . . . . . . . .219,173
8. Pará . . . . . . . . . . . . .200,000
9. Mato Grosso . . . . . .177,897
10. Minas Gerais . . . . . .130,877
Others . . . . . . . . . . . . .297,967
Source: ABPD (May 18, 2006)
police to fight piracy at the store and
street vendor level. It provides operational and logistical support for
various police initiatives to combat
organized crime in this arena.
APDIF also maintains a continuous presence at the nation’s ports
and airports to further the organization’s anti-piracy mission. The goal
is to make the import of blank CD-Rs
and DVD-Rs into the country more
difficult, as they are the primary vehicle for producing pirated recordings.
Courses and seminars are developed by APDIF in conjunction with
the police authorities throughout
Brazil to facilitate the identification
and destruction of pirated CDs.
In 2004, the supply of pirated
products in Brazil was relatively
stable. However, pirated CDs represented more than half of the overall
Brazilian CD market in that year.
As a result, Brazil ranked among the
top 10 markets globally for pirated
CD recordings.
2000
2001
2002
2003
2004
2005
3,223,295
122,165
280
NA
2,976,217
315,643
691
8
3,783,535
8,649,590
847
58
5,686,253
11,455,421
4,883
142
3,473,371
12,168,818
8,238
149
4,177,104
17,215,590
21,092
205
[email protected]
MAY / JUNE 2006 / VOL. 41 NO. 3
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10
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RECENT VICTORIES IN BRAZIL’S ANTI-PIRACY CRUSADE Continued from page 9
Combatting Online Music Piracy in Brazil: 2000-2005
2000 2001 2002 2003 2004 2005
Sites Notified for................3,766 8,897 9,708 8,782 4,125 2,282
Illegal Activities
Sites Removed from..........2,785 8,694 9,458 8,687 4,113 2,277
Internet for Illegal
Activities
Online Music Piracy
APDIF has also been combating
online music piracy since mid-2000,
when it began to monitor and help
prosecute illegal download sites
operating in Brazil.
The work of the APDIF in this
area essentially consists of
researching and monitoring illegal
sites, as well as working with online
service providers and auction sites
to structure policies that respect
intellectual property rights and
combat music piracy.
In 2005, APDIF identified 2,282
Internet sites that housed music content illegally. Of those sites, 2,277
were forced to close. Forty-seven percent were music download sites, 50%
were online stores selling pirated CDs
and 3% were illegal CD exchange
sites (clubs or groups of people who
created sites and provided listings of
CDs and DVDs that were available
for exchange, free of charge). It is
worth noting that 1,307 users engaging in music piracy via online auction
sites were also prosecuted.
According to national legislation, any non-authorized service that
directly or indirectly facilitates the
search, storage, distribution, sale or
download of music or other copyrighted material is considered illegal.
The state of São Paulo is the
most affected by the piracy problem,
with more than 16 million pirated CDs
seized last year. Paraná ranks second
with almost 9.1 million falsified
CDs in 2005. And Rio Grande do
Sul rounds out the top 3 with more
than 1 million units seized last year.
A total of 1,745 anti-piracy
initiatives were undertaken last
year in Brazil, including police
operations to combat piracy in
stores and by street vendors. In
addition, seizures of optical disk
recording hardware were up almost
160% as part of the nation’s
ongoing anti-piracy efforts. ■
Source: ABPD
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MAY / JUNE 2006 / VOL. 41 NO. 3
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11
The Future of Brazil’s Music Industry
hat can be said about a
country that ranks in the top
ten markets in the world for CD
sales, but no longer seems able to
develop its own megastars. Huge circulation numbers are a thing of the
past. The trend is towards greater
diversity and a dramatic increase in
the number of titles available in the
market. The major labels want quick
results with the lowest investment
possible. That attitude has allowed
independent record producers who
focus on niche markets to gain space
on store shelves and consequently a
larger share of Brazil’s music market.
Competition is mounting and
both segments of the market
(mass and niche) are battling for
consumer mindshare. Discovering
new talent, investing in a few
venerable artists and venturing outside the box seems the best course
of action for Brazilian labels.
Boosting creativity and overcoming
the problem of piracy (no doubt a
global problem, but one that is particularly acute in Brazil) are issues
that players in Brazil’s music industry need to confront.
There is a common adversary
that all Brazilian record labels
(regardless of size or market niche)
face. And that adversary is the
illegal music download market.
Devices that can download thousands of tracks are a reality and the
labels must adapt. It’s clear that
we’re living in a new technological
era. In terms of methods for illegally
reproducing music, the younger
cross-sections of Brazil’s consumer
market are using iPods and other
MP3 players to record music much
more frequently than previous generations reproduced music by taping
radio programs or dubbing their
friend’s records. The challenge is to
W
www.brazilcham.com
make the younger audiences aware
of just how important it is to value
the artists. Partnerships with retail
outlets to educate consumers will
become increasingly important if the
labels want to survive.
The success of players in
Brazil’s music industry will
depend on their ability to use
different strategies to reach
different consumer segments.
Now more than ever, the marketing and sales operations of record
companies need to be acutely aware
of the needs of their customers. By
learning more about the changing
preferences of consumers, they’ll be
able to improve sales prospects by
developing communication strategies
and promotional offers that respond
By learning more about
the changing preferences of
consumers, Brazilian labels
will be able to improve sales
prospects by developing
communication strategies
and promotional offers
that respond directly to
those preferences.
directly to those preferences.
I talk to lots of record store
owners and many say they’ve heard
predictions that the CD market
will die out. The best response I’ve
heard to this doomsday scenario
was from the manager of a large
store in Rio de Janeiro.
[email protected]
“The CD is a medium that is not
going to vanish, but it will need to
adapt to changing market trends.
Many people said that the Internet
would cause newspapers and other
print media to disappear and that
didn’t happen. Others said television
would do away with radio, and that
did not happen either. Media companies are increasingly joining forces
and merging in many cases in order
to reach their target audience more
effectively. However, this does not
mean the end of any one particular
medium. The same will hold true
for the CD market. There are several
CDs already on the market that
provide consumers with bonus
material not available via download
and that combine audio and video
capabilities. That is just one example
of how the CD market can differentiate itself from other segments of
the music industry and provide value
to consumers.”
The challenges remain and the
success of players in Brazil’s music
industry will depend on their ability
to use different strategies to reach
different consumer segments. The
phenomenon of huge sales by a few
mega artists will be increasingly
rare. The future is in the diversity of
the music offerings available to
consumers. Companies that are not
keenly aware of this fact aren’t going
to survive. ■
By José Renato Mattos de Castro.
General Director of
Putumayo World Music – Brazil.
MAY / JUNE 2006 / VOL. 41 NO. 3
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12
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The Digital Television Revolution in Brazil
s television around the world
begins its digital revolution,
Brazilian authorities are considering
launching their own domestic version
of the technology, a US$1 billion bet
on potential demand from 180 million consumers. If successful, the
country could justify creating its own
national standard to compete with
existing technologies in the United
States, Europe and Japan.
Global manufacturers are debating among several choices, including
● The US standard, known as
ATSC, which emphasizes
high-definition imagery;
● The European standard,
known as DVB, which is better for programming and
interactivity; and
● Japanese digital technology,
known as ISDB, which
merges high-definition capabilities with mobile platforms.
Since 2004, Brazilian
researchers from the private sector
and a consortium of 22 universities
have been studying whether to create
a domestic Brazilian system, adopt
an existing one, or develop a new
standard together with other emerging nations such as South Korea,
China or India.
Augusto César Gadelha, the
Director of Industry, Science and
Technology at Brazil's Communications Ministry, says Brazil's decision to consider taking its own path
toward digital technology is already
causing a stir. Industry lobbyists
from abroad are treating Brazil
differently, all because the nation
might go its own way.
Brazil's electronics industry
association, Abinee, estimates that
the semiconductor industry alone
will need to invest US$1 billion to
manufacture the necessary components for new digital equipment.
Toshihiko Komatsu, Abinee's vice
A
MAY / JUNE 2006 / VOL. 41 NO. 3
director of electronic components,
believes digital television provides a
historic opportunity for Brazil to
create an industrial policy and to
provide tangible incentives for
Brazilian television manufacturing.
``We have what we need to develop
everything here,'' Komatsu says.
Digital television could be a big
driver of domestic industrial growth,
according to both entrepreneurs and
government leaders. In 2004 alone,
Brazil imported $7.8 billion in electric and electronic components, up
36% from 2003.
Over the course of this year,
Brazil's government will invest $26
million to study which digital television standard would be best for the
country. If the country does opt to
develop its own technology, the big
question will be how to structure
incentives for local industry without
repeating the missteps that occurred
in Brazil's domestic computer industry in the 1970s and 1980s. As a
result of that experiment, Brazil
ended up more than 20 years behind
the global technology curve.
Beyond high-fidelity sound
and cinema-quality images,
digital television could also
allow for interactivity, new
forms of programming,
e-mail access, home banking,
and a wealth of
additional services.
Adopting a new standard also
requires that Brazil find a viable
solution to a very complex problem
— how to switch consumers from
analog to digital technology. There
are more than 50 million television
sets in operation in Brazil. All of
those TVs will have to be replaced
or, at the very least, adapted with
some kind of signal converter. And
[email protected]
it's not just the television sets that
will need to be upgraded. The costs
on the production side are also
daunting. Brazil's Association of
Radio and Television Broadcasters,
Abert, figures that it will cost broadcasters more than US$650 million to
adapt to the new digital standard.
Brazil needs to define a
comprehensive business model
for digital television, not just a
technical standard, so that
all of the relevant factors
can be considered.
Argentina, Mexico and Canada
have already moved to adopt the US
technology. In Brazil, no matter
which standard is ultimately adopted,
industry representatives are concerned that there could be significant technical obstacles to producing
new TV sets or signal converters.
They also affirm that any technology
adopted must be able to communicate with digital standards already in
use elsewhere in the world.
Brazil sold seven million TV
sets domestically last year, according
to data from the National Home
Electronics Manufacturers
Association, Eletros. Once digital
technology becomes a commercial
reality, there is obviously huge market potential in Brazil. Paulo Saab,
Eletros' president, says industry,
government and broadcasters
shouldn't limit the discussion to
purely technical issues. “We need to
define a comprehensive business
model for digital television, not just
a technical standard, so that all of
the relevant factors can be considered,” affirms Saab.
Beyond high-fidelity sound and
cinema-quality images, digital television could also facilitate interactivity,
www.brazilcham.com
13
Top 20 CDs and DVDs in Brazil: 2005
Ranked by Sales
The CD “Perfil” by singer Ana Carolina generated the most sales in Brazil in 2005. Roberto Carlos held the
top spot for DVD sales in 2005, followed by Ivete Sangalo and Xuxa.
Top 20 DVDs in Brazil (2005)
Top 20 CDs in Brazil (2005)
1. Ana Carolina – “Perfil – Ana Carolina”
(SonyBMG / Globo)
2. Ivete Sangalo – “As Super Novas”
(Universal Music)
3. Bruno e Marrone – “Meu Presente é Você”
(SonyBMG)
4. Zezé Di Camargo & Luciano – “Zezé Di Camargo
& Luciano 2005” (SonyBMG)
5. Maria Rita – “Segundo”
(Warner Music)
6. Vários – “América”
(Som Livre)
7. Xuxa – “Xuxa Festa – XSPB 6”
(Som Livre)
8. Roberto Carlos – “Roberto Carlos 2005”
(SonyBMG)
9. Vários – “Summer Eletrohits”
(Som Livre)
10. Leonardo – “Leonardo Canta Grandes Sucessos –
Vol.2” (SonyBMG)
11. Kid Abelha – “Acústico MTV – Kid Abelha”
(Universal Music)
12. Rebelde – “Rebelde (Brazil Edition)”
(EMI Music)
13. Rebelde – “Rebelde (Spanish Edition)”
(EMI Music)
14. Vários – “Floribella”
(Universal Music)
15. O Rappa – “O Silêncio Q Precede o Esporro”
(Warner Music)
16. Roupa Nova – “Roupa Nova Acústico”
(Universal Music)
17. Vários – “América Rodeio”
(Som Livre)
18. Vários – “Alma Gêmea”
(Som Livre)
19. O Rappa – “Acústico MTV”
(Warner Music)
20. Marjorie Estiano – “Marjorie Estiano”
(Universal Music)
1. Roberto Carlos – "Pra Sempre Ao Vivo no Pacaembú"
(SonyBMG)
2. Ivete Sangalo – "MTV Ao Vivo – Ivete Sangalo"
(Universal Music)
3. Xuxa – "Xuxa Festa – XSPB 6"
(Som Livre)
4. Vários – "Live 8"
(EMI Music)
5. Chico Buarque – "Meu Caro Amigo"
(EMI Music)
6. Chico Buarque – "A Flor da Pele"
(EMI Music)
7. Chico Buarque – "Vai Passar"
(EMI Music)
8. Bruno e Marrone – "Bruno e Marrone Ao Vivo"
(SonyBMG)
9. Rebelde – "Tour Generation RBD"
(EMI Music)
10. Roupa Nova – "Roupa Nova Acústico"
(Universal Music)
11. Ana Carolina e Seu Jorge – "Ana e Jorge"
(SonyBMG)
12. U2 – "U2 2005 Vertigo"
(Universal Music)
13. O Rappa – "Acústico MTV"
(Warner Music)
14. Chico Buarque – "Anos Dourados"
(EMI Music)
15. Chico Buarque – "Estação Derradeira"
(EMI Music)
16. Chico Buarque – "Bastidores"
(EMI Music)
17. Edson & Hudson – "Galera Coração Ao Vivo"
(EMI Music)
18. Diversos – "Floribella"
(Universal Music)
19. Latino – "Ao Vivo 10 Anos"
(EMI Music)
20. Zeca Pagodinho – "Zeca Pagodinho Ao Vivo MTV"
(Universal Music)
Source: ABPD 2006
www.brazilcham.com
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MAY / JUNE 2006 / VOL. 41 NO. 3
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14
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THE PAN AMERICAN GAMES RIO 2007 Continued from page 5
world-class facilities for Field
Hockey and the Modern Pentathlon
competitions. The federal administration is also responsible for the
construction of the temporary
venues on Copacabana Beach for the
Triathlon, Beach Volley and the
Aquatic Marathon competitions.
The global exposure for
both Rio de Janeiro and
Brazil as a whole will provide
a unique opportunity to
publicize the nation’s vast
natural and cultural riches.
The state government of Rio de
Janeiro has assumed responsibility
for remodeling the Maracanã Sport
Complex and has already completed
the refurbishment of the Júlio
Delamare Aquatic Park. A significant
amount of the work at Maracanã
Stadium has already been completed.
The refurbished field is already in
use and work on new seating and
other infrastructure upgrades is
ongoing in order for the facility to
achieve full compliance with FIFA
standards. In addition, the state government is modernizing the Gilberto
Cardoso Gymnasium, also known as
Maracanazinho, in accordance with
international standards. The state is
also dredging the rowing track at
Lagoa Rodrigo de Freitas and developing all of the infrastructure
required for the various rowing events.
One of the main tasks assigned
to Rio’s local government is the
construction of the Speedway Sport
Complex, where the Aquatic Park,
@
the Multi-sport Arena and a new
velodrome are being built. In addition, the local government will oversee the construction of 45,000 new
seats at the João Havelange Stadium,
as well as the remodeling and
enlargement of Glória Marina. The
local government also owns
Riocentro, the largest convention
center in Latin America, which will
host 11 disciplines in temporary
venues. The convention center will
also house the Press Center and the
International Broadcasting Center.
GL Events, the private-sector concessionaire that operates Riocentro,
will be working under City Hall
supervision to transform the facility
to meet the needs of the Rio 2007
Games. The local government will
also remodel the Miécimo da Silva
Sport Center and is funding the
maintenance costs for CO-RIO.
The economic impact of the Rio
2007 Games is already being felt.
Brazil has strengthened its sport,
diplomatic and trade ties with other
countries in the Americas as a result
of ongoing preparations. The global
exposure for both Rio de Janeiro and
Brazil as a whole will provide a
unique opportunity to publicize the
nation’s vast natural and cultural
riches.
An event of this magnitude
boosts the local economy, generates
jobs and creates new business opportunities before, during and after the
Games. In addition, Rio 2007 has
helped to upgrade the city’s tourism
infrastructure via projects such as
the enlargement and modernization
of the city’s domestic and international airports, as well as the construction of new hotels and training
of industry professionals. All of
these efforts will help to enhance
Rio’s position as a tourism industry
leader in Latin America.
Another important legacy of the
Rio 2007 Games will be the training
of personnel for international events
of this scope. Professionals from
An event of this magnitude
boosts the local economy,
generates jobs and creates
new business opportunities
before, during and after
the Games.
various sectors will be trained and
will take an active role to ensure the
success of the event. Furthermore,
they will be better prepared for other
large sporting and entertainmentrelated events in the future.
The Organizing Committee of
Rio 2007 and the Brazilian Olympic
Committee strongly believe that this
event will bring innumerable benefits to Rio de Janeiro, Brazil and the
Americas. Given that the Pan
American Games constitute the second largest multi-sport event in the
world, we are working tirelessly to
ensure that Rio 2007 establishes a
new benchmark for successful
investment programs in the area of
international sports. ■
Olympic Greetings!
By Carlos Arthur Nuzman,
President of the Organizing
Committee of the Pan American
Games Rio 2007
and President of the Brazilian
Olympic Committee
Please send us your e-mail address!
In order to update our database with our members’ accurate e-mail addresses we are asking that
you
MAY / JUNE 2006 / VOL. 41 NO. 3
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15
BRAZILIAN MUSIC AND ENTERTAINMENT NEWS Continued from page 7
“Initially, we believed the
initiative would involve 70 companies,
but we now have 150 companies
participating in the program and
they’ve signed deals with media
outlets in 12 countries,” says Patrício
Prado, a Promoex executive. The
program has also facilitated the
participation of Brazilian production
companies in international fairs
such as Kids Screen in New York.
Participating in these international
events opened the doors for TV
Pingüim, an animation company
based in São Paulo that has
already produced programming for
TV Cultura, TV Futura and the
Cartoon Network.
TV Pingüim has also signed a
co-production deal with Nelvana,
Canada’s largest animation firm,
for US$4.8 million to produce 52
episodes of an animated series that
will be aired on Discovery Kids.
Grifa Mixer, another Brazilian
production company that creates
documentaries for TV and cinema,
has five co-production projects
underway for channels such as the
Discovery Channel, Arte (France and
Germany), FRV (Canada) and with
production companies such as
Gedeon (France) and the National
Film Board of Canada. According to
Maurício Dias, Director of Grifa
Mixer, “The biggest challenge for us
is developing projects for Brazil’s
domestic market...As incredible as it
sounds, it’s easier to get the support
of European companies.”
Brazil Once Again Has Strong
Presence at the International
Advertising Festival in Cannes
(O Estado de São Paulo – June
19, 2006) This year’s International
Advertising Festival in Cannes
boasts 24,000 entries from 81
countries in nine separate categories.
With 2,537 pieces in the competition, Brazil is second only to the US
in terms of the number of entries,
and ahead of the UK, Germany and
Spain – all countries that have a
strong tradition at Cannes.
Among the Brazilian entries are
233 TV spots, 1,055 print pieces,
703 billboards, 324 online advertising pieces, 68 radio spots, 53 direct
marketing pieces and 53 promotions.
Media Outlets Meet to Discuss
Regulations Governing Election
Coverage
(O Popular – June 20, 2006)
With the election season in full
swing, Brazil’s media companies
need to adopt a particularly sober and
democratic approach to gathering
information and reporting, primarily
when it comes to publishing interviews
and other reports on candidates in
the forthcoming elections.
There is federal legislation in
Brazil that stipulates exactly what
media companies can do in terms of
covering candidates during the
run-up to elections, particularly radio
and TV companies. Violations of the
rules can result in fines up to
R$106,000. Such fines have caused
Brazilian media companies to close,
says Oscar Luiz Piconez, Executive
Director of the Brazilian Association
of Radio and TV Producers (ABERT).
Piconez participated in the Seminário
Eleições 2006 in mid-June. The event
sought to orient Brazilian media professionals on the restrictions related to
media coverage during election seasons. While the restrictions have a
greater impact on TV and radio companies, newspapers and magazines
must also pay attention to the legislation, says Alexandre Jobim, Legal
Counsel for ABERT.
Copa Digital
(Diário de Borborema – June
19, 2006) Brazilian soccer fans relying on network television stations to
provide high-definition imagery and
new interactive services for this
year’s World Cup were no doubt
frustrated. However, a few satellite
TV operators in Brazil did test new
digital technologies during the action
this year in Germany. Satellite
providers such as Sky, DirecTV, Net
and WayTV have already initiated a
new era in Brazilian television.
Subscribers enjoyed digital coverage
in high definition with stereo sound,
but without much in the way of new
functionality. DirecTV and Sky are
experimenting with limited forms of
interactivity. The networks, for their
part, still need to wait for the decision of the Brazilian government as
to which international standard it
will adopt. ■
THE DIGITAL TELEVISION REVOLUTION IN BRAZIL Continued from page 12
new forms of programming, e-mail
access, home banking services, and a
wealth of additional services. With so
many options, content could be key in
the new age of television.
Celso Augusto Schroder, general
director of Brazil's not-for-profit
www.brazilcham.com
National Forum for the Democratization of Communications, argues that
most of the decisions regarding the
move to digital technology should be
made in Brazil. “This discussion
can't be done in a hurry,” he says.
“We run the risk of taking a step
[email protected]
backwards if we make decisions
without duly analyzing all the possible consequences.” ■
By Luciano Somenzari, São Paulo
(Originally published in Latin Trade)
MAY / JUNE 2006 / VOL. 41 NO. 3
SPECIAL
SECTION
16
Brazilian Economy
Bucking the Global Tightening Trend
ast month, as central banks around
the globe scurried to hike interest
rates, Brazil’s Central Bank showed
little hesitancy in cutting rates at
home. And despite the market turmoil
seen in both developed and emerging
markets as of late, we believe that
Brazil’s Central Bank should be able
to cut rates by a similar magnitude
when it meets later this month.
We expect interest rates to be
cut by an additional 50 basis points
at the July meeting, bringing the
Selic benchmark rate to 14.75%.
We also believe there is still room
for additional rate cuts that will
bring the year-end rate in alignment
with our forecast of 14%. With inflation under control, a stronger track
record to help keep expectations in
check and overnight rates currently
at 15.25%, we suspect that Brazil
can continue to seek out neutrality
on the interest rate front. Neutrality
for Brazil, unlike for most of the
world, should mean lower rates.
Over the past four weeks, at
least nine central banks – from the
European Central Bank to the central
banks of India, Korea, Turkey, South
Africa and even Iceland – have
raised interest rates. While Denmark
and Switzerland joined the list of
rate hikers and Sweden is expected
to do so soon, the list is largely
dominated by emerging markets.
Given Brazil’s legacy of hyperinflation and a mixed picture on the
inflation targeting front, our view –
that Brazil is likely to continue
cutting rates – may seem wildly
optimistic. But we believe Brazil
finds itself in a very different
situation than other central banks
and hence should be able to continue
to ease monetary policy during the
second half of 2006 and 2007.
L
Taking a Different Path
It is perhaps an exaggeration to
compare the US inflation rate with
MAY / JUNE 2006 / VOL. 41 NO. 3
that of Brazil. However, last month the
annual rates were indistinguishable
until you considered the hundredths
column. Both the US and Brazil
reported that annual inflation for the
twelve months ending in May was
4.2%. Brazilian inflation was slightly
higher if an additional decimal point
was added – 4.23% compared to the
US rate which had been rounded up
from 4.17%.
Of course, the comparison is not
entirely fair. Core inflation in the US
is still lower than Brazil. Additionally,
Brazil’s low inflation figures in May
stemmed in large part from a strong
harvest that yielded lower food prices.
The harvest also helped to reduce
transport costs thanks to Brazil’s
increased reliance on ethanol derived
from sugarcane. Still, with the Fed
struggling to decide how much farther
to raise the fed funds rate above 5%,
Brazil’s overnight rate – which stood
at 15.75% until last month’s 50 basis
point cut – clearly seems too high.
Nonetheless, the comparison
with the US underscores one of the
key differences between Brazil and
other countries that have moved
recently to increase rates. Brazil,
unlike many markets, is still enjoying
a bout of disinflation. [Editor’s Note:
Disinflation refers to the slowing
down of the rate at which prices
increase. Disinflation should not be
confused with deflation, when prices
actually drop].
Not only is headline inflation
(i.e., the Consumer Price Index) now
running below the Central Bank’s
target of 4.5%, but other inflation
indices are also showing remarkable
progress. São Paulo’s primary
inflation index (i.e., FIPE) dropped
0.22% in May. Furthermore, in the
four weeks ending in early June,
prices measured by the FIPE actually
fell 0.38%, producing the lowest
monthly reading in six years.
Meanwhile, Brazil’s IGP-M index,
[email protected]
still widely used to set tariffs in
regulated industries, has produced
outright deflation since April (-0.9%
for the twelve months ending in
April and -0.3% for the twelve
months ending in May).
Brazil faced inflation shock in
late 2002 and early 2003. Its strong
response then continues to wield a
positive impact on inflationary
expectations today. During that bout
with inflation, the Consumer Price
Index rose from 7.5% in August
2002 to 17.2% in May 2003. By the
time the current Central Bank leadership took office in early 2003,
annualized inflation had risen above
30%. Brazil’s response was to tighten
fiscal and monetary policies despite
the substantial political cost to the
new administration as well as the
significant decline in economic
activity over the short term.
By June 2003, Brazil was beginning to show signs of deflation as
the combination of tight fiscal and
monetary policies inhibited consumer
spending. In fact, consumer spending
experienced one of its sharpest
declines in nearly a decade. We
believe the move, though costly in
terms of output, was necessary,
given the credibility challenges facing the Central Bank and the fiscal
authorities during the first year of
the Lula administration.
We are not arguing that Brazil is
immune to an upturn in inflation. As
previously noted, part of Brazil’s
success on the inflation front in
recent months is tied to an unusually
strong harvest. Thus, some of the
recent gains could be reversed in the
coming months. The weakness of the
real over the past few weeks has
prompted some to conclude that the
currency’s nominal appreciation
period is over. That, in turn, could
reduce some of the disinflationary
pressures witnessed over the past
www.brazilcham.com
18
BRAZILIAN ECONOMY Continued from page 16
year. Despite these risk factors, we
still argue that Brazil’s inflation forecast is very different than that of
many other nations that have raised
interest rates recently. And when
tested, Brazil did not hesitate to
respond with tough fiscal and
monetary measures.
Taking a Look Back
Of course, some Brazil watchers
look to Brazil’s past and draw the
opposite conclusion when it comes
to inflation. They argue that in the
second half of 2004, just a little over
a year after Brazil had tightened fiscal
and monetary policies, inflation
began to rear its ugly head and could
easily do so again during the second
half of 2006. However, the differences
between 2004 and 2006 are significant.
First, aggregate demand
pressures were much stronger in
mid-2004 than today. By the second
quarter of 2004, Brazil’s real GDP
was growing at a rate of 5.1% yearover-year. In contrast, real GDP in
the first quarter of 2006 was up only
3.45% and it is expected to grow at
an even slower rate in Q2.
Second, Brazil’s external situation is much stronger today, with a
trade account surplus of over US $45
billion in the twelve months through
May 2006 versus a surplus of US$28
billion in the twelve months through
May 2004. The larger trade (and
current account) surpluses should
provide some cushion in the event of
a sharp currency move, limiting the
inflationary impact.
Third, Brazil is in a much more
comfortable position with respect to
international reserves. As of May
2004, Brazil had only US$24.5 billion in reserves and the net public
external debt (net of reserves) stood
at just over US$56 billion. In contrast, as of last month, international
reserves had reached US$63.4 billion and the net public external debt
had fallen to US$5.3 billion as of
April 2006 (Editor’s Note: The
MAY / JUNE 2006 / VOL. 41 NO. 3
authors have excluded IMF monies
in both cases to make the comparison apple-to-apples). Furthermore,
in mid-2004, Brazil still had almost
US$39 billion in dollar obligations
in domestic debt (including FX
swaps). Such dollar obligations
have fallen dramatically over the
past two years.
Fourth, two years ago when
inflation began to reemerge in
Brazil, the Central Bank had just
finished a dramatic period of rate
cuts totaling 1,050 basis points. In
contrast, the rate cuts since
September 2005 have totaled less
than half of that figure. Even with
the rate cut of 50 basis points last
month, the benchmark rate has come
down by only 450 bps, from 19.75%
in August 2005 to 15.25% in May
of this year.
Finally, Brazil’s Central Bank
has developed a track record that is
much stronger today than in 2004.
There was considerable doubt at the
beginning of 2003 as to whether the
Central Bank and the Finance
Ministry would be able to reign in
inflation. Despite the successful
efforts in 2003, we once again
heard doubts in 2004 as to whether
monetary policy could be used
effectively prior to key mid-term
elections. The Central Bank’s
move in September 2004 – and
subsequent months – helped to
consolidate its reputation as a
serious inflation fighter.
Despite the market jitters internationally, local rates have behaved
much better this time than they did
during the 2004 episode. During the
April and May 2004 sell-off, the real
lost about 12% of its value, moving
from 2.87 to 3.21, while one year DI
contracts jumped more than 340 bps
from 15.4% to 18.8%. This time, a
larger currency move – from 2.06 to
2.35 – prompted one-year DI contracts to widen by less than half
(from 14.65% to 16.12%) what we
witnessed in 2004.
[email protected]
The Caveat
Of course, there are risks that
could threaten Brazil’s ability to
continue bucking the global tightening trend. Currency moves could
continue as investors reduce Brazil
positions in order to raise cash for
redemptions. That, in turn, could
put more pressure on the real and
begin to contaminate expectations.
In short, a prolonged bout of
currency pressure could change
Brazil’s inflation dynamic. Higher
oil prices could also prompt
Petrobras to adjust prices and force
consumers to pay more at the pump.
The Bottom Line
With the current emerging markets sell-off, it may seem foolhardy
at worst and irrelevant at best to be
highlighting the fundamental
improvements in Brazil. At times,
context can get swept away as
investors rush to deal with a sell-off.
But unless the current global turmoil
continues unabated (which we
doubt) or produces a calamity for
the US consumer (which is not what
our US team is projecting), we suspect that Brazil’s Central Bank will
continue to have room to buck the
global tightening trend and reduce
interest rates.
We expect interest rates to be
cut by an additional 50 basis points
at the July meeting to bring
overnight rates to 14.75%. We also
believe there is still room for additional rate cuts in order to move
closer to our year-end forecast of
14%. ■
By Gray Newman,
Senior Economist for Latin American
Economics at Morgan Stanley
and Heloisa Marone,
Market Analyst at Morgan Stanley.
www.brazilcham.com
19
Working Towards a
WTO Agreement
he political issues surrounding
the Doha Round necessitate a
high degree of responsibility and
adeptness on the part of the negotiators. If we analyze the recent past
and the debt that the international
trade system has with Brazilian
agribusiness – due to protectionism
in the developed markets – it is easy
to understand that Brazil is not
interested in inking an agreement
this month that does not wield a
concrete and positive impact on the
Brazilian economy.
To deliver against the promises
made by the members of the World
Trade Organization (WMO) at the
onset of the Doha Round in 2001,
the final accord must level the playing field between the agricultural
sector and manufacturing. Trade
policies focused on agriculture
should be liberalized in order to
compensate for the industrial opening that has been ongoing since
1947, the year in which the General
Agreement on Trade and Tariffs
(GATT) was signed. Brazil was one
of the original signatories of GATT.
We believe that if the “GATT
debt” were converted into current
financial terms, it would constitute
an enormous economic stimulus for
our country and others affected by
the distortions in global agricultural
trade. For Brazil, agribusiness
represents 30% of GDP, 40% of
exports and 90% of the nation’s
trade surplus.
Negotiators from the developed
nations are well aware of the current
colonialist model of international
trade. Europe and the US, together,
account for 50% of the global GDP
and spend US$100 billion a year on
agricultural subsidies to keep 4% of
their population employed as farmers.
These subsidies and trade
barriers contribute to several social
and economic paradoxes. For exam-
T
www.brazilcham.com
ple, two billion people around the
globe live on less than US$1 per
day, but French cattle receive subsidies amounting to US$2 per day
per cow. Brazil is the world’s largest
producer of coffee, but Germany is
the largest exporter – without even
having one square foot of agricultural land planted with coffee
beans. This is due to the high
import tariffs in Europe on roasted
and ground coffee. In the energy
sector, Brazil is obliged to pay a
44% tax to sell ethanol in the US
and 51% in the European Union.
Brazil’s poultry exporters pay
tariffs totaling 505% to enter the
Canadian market and 894% to
export to Norway. Brazil’s orange
juice producers must contend
with the perennial “antidumping”
measures in the US, the sole
objective of which is to maintain
production in Florida.
Two months ago, the Federation
of Industry of São Paulo (FIESP)
received a visit from the General
Director of the WTO, Pascal Lamy,
for the second time in less than a
year. During that visit, it became
clear to me that the political and
economic bartering required to
produce an acceptable agreement in
the Doha round from the Brazilian
perspective would require a threepronged approach:
population and 90% of global gross
domestic product).
The success of the next round of
WTO negotiations can and should be
an opportunity to address the debt
that the developed economies have
had with Brazil – and other emerging
economies – for more than 50 years.
This will allow Brazil to play a
larger role in agribusiness on the
international stage.
For two decades, we’ve been
opening our markets and becoming
increasingly competitive in a variety
of agricultural, industrial and service
sectors. It’s now time for the EU and
the US to make concessions. And
just to be clear – Brazil’s industrial
sector is willing to deviate from its
current position on industrial tariffs
to favor the “Swiss 30” formula (i.e.,
a 50% reduction on tariffs). Brazil’s
negotiation team can be conciliatory,
but it must maintain the overall
goal of leveling the playing field in
agribusiness and growing the
Brazilian economy. Now is the
moment for action from Washington
and Brussels. ■
● The US would need to
improve its stance on agricultural subsidies for its farmers
● The EU would need to cut its
tariffs on agricultural imports
● And the G-20 countries
would need to implement a
more significant reduction on
import taxes for industrial
goods.
(Editor’s Note: The G-20 is an
informal forum that promotes dialogue between finance ministers
and central bank governors from
significant industrial and emerging
market economies. The G-20 represents around two-thirds of the world’s
[email protected]
By Paulo Skaf,
Entrepreneur and President of FIESP
(Federation of Industries of
São Paulo State)
Source: O Estado de São Paulo –
6/10/2006.
Upgrade Your
Membership!
For more information
about the value-added
benefits of membership,
contact the Chamber at
(212) 751-4691
MAY / JUNE 2006 / VOL. 41 NO. 3
International Trade
20
International Trade
A Outra Copa:
Brazil and the
Doha Round
hile the world’s attention is
focused on the World Cup
games in Germany, a much more
important “World Cup” may soon be
decided in Geneva where trade negotiators from 50 countries are gathered
to decide the fate of the Doha Round.
As in Germany, Brazil is a prominent
participant in these games, its team of
negotiators one of the most able on
the field in Geneva. Brazil can be a
big winner in Geneva, if it plays to
the best of its ability and helps to
broker a broad agreement for trade
liberalization. At the same time, a
breakdown in these talks could be
bad for world trade and, worse, an
even bigger setback for Brazil.
W
The Geneva Talks
While few are unclear as to
what is at stake in the FIFA World
Cup, our general knowledge of
global trade talks could use a brief
refresher. The so-called Doha (or
“Development”) Round of multilateral trade negotiations was launched
Compromises on all sides
are in order – by the EU on
agricultural tariffs, by the US
on agricultural subsidies, and
by the large emerging markets
(perhaps especially Brazil, but
also others) on liberalizing
trade in industrial products.
in Doha in 2001 (following the
attacks of September 11). The
round’s success is critical to the
overall health of the World Trade
Organization (or WTO). Failure at
this late stage would certainly have
real costs – lost opportunities for
MAY / JUNE 2006 / VOL. 41 NO. 3
developing countries (including
Brazil) to gain from global trade
liberalization, increases in developed
country protectionism, adverse shocks
in the global financial markets, and
a systemic erosion in the WTO itself.
What then will be happening in
Geneva? Trade ministers must clear
the way for global agreement on the
two most contentious issues in the
trade talks – liberalizing global trade
in agriculture (where the richest
countries must make the biggest
concessions) and assuring increased
market access for trade in industrial
goods and services (in which Brazil,
India, China, South Africa and other
large emerging economies are the
ones who will have to offer the
biggest concessions).
While these issues have been on
the table for a long time, the trade
ministers meeting in Geneva are
racing against a deadline, one that is
set by US law. The US administration’s authority to negotiate a trade
agreement expires in the middle of
2007. Given the prevailing sentiment
in the US Congress on global trade
(recall that the innocuous CAFTA
agreement passed by a margin of
just two votes in the House), it is
considered virtually impossible for
this “fast track” authorization to be
renewed beyond 2007. Thus, the
negotiators meeting in Geneva have
until the end of 2006, at the latest,
to move the agreement forward.
In essence, this means that 149
countries will have to come to an
agreement over the next several
months on the liberalization of
trade in goods and the extent of
liberalization in services, plus other
thorny matters. Compromises on all
sides are in order – by the EU on
agricultural tariffs, by the US on
agricultural subsidies, and by the
large emerging markets (perhaps
especially Brazil, but also others) on
liberalizing trade in industrial products.
None of these three groups of nations
[email protected]
who are the real “players” in the
games in Geneva has yet suggested
any changes in their positions since
the dismal Hong Kong ministerial
meetings last December. Will things
be any different in Geneva? The
future of global trade may depend on
the answer to that question.
As a relatively free trader
in agriculture (Brazil’s own
farm tariffs are low),
Brazil can only expect to gain
from forward progress on
reducing export subsidies,
domestic subsidies and
tariff barriers on
agricultural products.
Brazil’s Role in Global Trade
Negotiations
Just as the seleção is a center
of attention in Germany, the Brazil
team in Geneva will be a central
player. Farm trade issues will dominate the discussions and Brazil’s
growing prominence as an agricultural trader (the third largest in the
world) puts the country in the
limelight. As a relatively free trader
itself in agriculture (Brazil’s own
farm tariffs are low), Brazil can
only expect to gain from forward
progress on reducing export
subsidies, domestic subsidies and
tariff barriers (market access) on
agricultural products.
In other trade negotiation issues,
Brazil will be playing a much more
defensive game. The richer countries
have been seeking a generalized cut
in import tariffs on industrialized
goods according to a formula which
would result in tariffs being cut to
below 10%. Brazil’s industrial tariffs
are still relatively high, as high as
30% or more in many product areas.
www.brazilcham.com
21
Moreover, the richer countries
are asking for greater liberalization
in the service sector, including banking and insurance. These sectors in
Brazil (and elsewhere) are relatively
closed to international trade and
Brazil has been reluctant to make
any significant concessions.
Brazil’s role in the Geneva talks
and in what lies ahead for the Doha
Round is extremely important. It is a
large emerging market in its own
right and by far the most important
market in South America. Beyond
this, Brazil has assumed various
leadership roles internationally,
including co-chairing the G-20
group. This diverse group of global
traders – which includes China,
India and South Africa – has sought
to coordinate negotiations in the
Doha Round in order to exert
maximum pressure for concessions
on the richer countries, especially
the US, the EU and Japan.
Brazil’s Choices
No one would ever accuse
Brazilian politicians and business
leaders with complacency in terms of
the attention given to the national
soccer team in Germany. The country
comes to a virtual standstill each time
the team takes the field. Something
approaching this level of passion is
needed in the area of Brazil’s trade
negotiations, although apathy and misunderstanding seem to be more typical
characteristics of the public debate.
Part of the lack of interest in
these trade talks in Brazil may come
from a perception that Brazil is
doing relatively well in terms of
world trade, so why worry about the
future? Exports have surged in
recent years and while imports are
also growing, the latest (June 2006)
numbers on the overall trade balance
are still pointing to a trade surplus
close to $40 billion for 2006. Few
stop to consider that these impressive
trade results stem mainly from
www.brazilcham.com
extraordinarily favorable circumstances in the global economy
which cannot be extrapolated very
far into the future, especially amid
mounting concerns about the health
of the US economy.
Despite the surge in Brazilian
trade in recent years, the
nation remains unusually
closed to international trade.
In 2003, Brazil’s overall
ratio of trade to GDP
was on the order of 25%,
respectable by historical
standards for Brazil but still
the eighth lowest among the
140 countries surveyed.
From a political perspective,
Brazil has maintained that the country
is punished by high tariffs in those
sectors (including agriculture) in
which it is most competitive. “If the
rich countries are not open to our
products, why should we open our
doors to their industrial goods and
service exports?” is the way this
argument goes in Brazil. While
logical and politically appealing, the
argument ignores the fact that trade
is not a zero-sum game, and that
indeed all sides can benefit from
trade liberalization. Besides, this
argument often boils down to a
position that continues to favor
inefficient domestic producers at the
expense of larger national interests.
Conclusions
No one would argue that the
seleção’s defense should move to the
side of the field in order to allow the
opponent to score goals more easily
in Germany. So why should Brazil’s
team in the Geneva talks and in the
broader Doha Round consider
making unilateral concessions in the
[email protected]
areas of industrial goods and services
in the interest of assuring success in
these global talks? Is that logical?
Shouldn’t the richer countries be the
ones to make the first move?
Maybe, but not necessarily. Two
quick facts will help to illustrate the
point that Brazil has more to gain
from liberalization than other countries. The first is that Brazil, despite
the surge in trade in recent years,
remains unusually closed to international trade. In 2003, for example,
Brazil’s overall ratio of trade to GDP
was on the order of 25%, respectable
by historical standards for Brazil,
but still the eighth lowest among 140
countries, according to data from the
World Bank. In terms of openness to
imports in the same year, the situation
was even worse, with Brazil’s import
to GDP ratio of 10% among the
three lowest out of the sample of 140
countries. It is difficult to imagine
that an import ratio that is so low is
consistent with providing Brazilian
consumers with access to high quality
products at a low cost or providing
Brazilian industry with access to the
latest technology in capital goods.
Brazil is right to defend its
interests in global trade talks vigorously, and it has an able team of
diplomats who do just that. Yet
somehow, the ferocious defense of
the national interest in these arcane
trade talks may be missing the bigger
picture – Brazil is still far behind the
levels of openness prevailing in the
rest of the world, including other
emerging markets. Public policies
and public attitudes in Brazil need to
change and change quickly. Geneva
may be a good place to start. ■
By Thomas Trebat,
Executive Director of the Institute
for Latin American Studies at
Columbia University.
(Email: [email protected])
MAY / JUNE 2006 / VOL. 41 NO. 3
INTERNATIONAL TRADE Continued from page 20
22
Political Scenario
Can Lula Win in the First Round?
aving recovered his popularity
at the end of last year, Lula has
maintained a comfortable lead over
all potential opponents ever since.
The exception, of course, would
have been José Serra (PSDB), then
mayor of São Paulo. But the PSDB
picked Geraldo Alckmin, highly
praised as the governor of São
Paulo, but unknown to more than a
third of voters nationwide. So far,
he has proved to be a rather colorless politician. If conditions remain
unchanged prior to the elections in
October, Lula will almost certainly
win in the first round.
The dispute between Alckmin
and Serra for the PSDB presidential
nomination was an additional factor
favoring Lula earlier this year.
Unable to make a quick decision,
the party leadership conducted a
clumsy and protracted process
which obviously did little to help
the eventual nominee.
Whether Lula’s current edge
will or will not wane is anyone’s
guess. Factors contributing to his
strong showing in the polls include
the economy, substantial media
exposure, his ability to communicate
with the humblest social groups and,
no less important, timely and politically well-tailored government
spending, particularly the bolsafamília program, which wields a
strong positive impact on the poor
in the Northeastern region of the
country. Among low-income voters,
Lula’s image remains remarkably
untainted by the recent scandals, at
least in comparison to most congressional politicians. Available polls
also show that Lula is regarded by a
substantial majority as the likely
winner in October.
H
Alckmin’s resources, on the
other hand, are much more limited in
comparison. However, the 45-day
official campaign period could be a
turning point for the candidate.
Alckmin is a very effective communicator, and may surprise a great
many voters. He also stands to
benefit by riding the coat-tails of
strong PSDB candidates in key
states. Odds are that José Serra and
Aécio Neves, both from the PSDB,
will emerge victorious in the gubernatorial races in São Paulo and
Minas Gerais. These are by far the
two biggest states, with roughly
35% of the country’s voters. In
Bahia, another key battleground,
Alckmin will be supported by that
state’s political boss, senator Antonio
Carlos Magalhães.
Whether the election will be
decided in the first round is still
unclear. To win in the first round, a
candidate must have a clear majority
of the valid votes, i.e., more votes
than all other candidates combined.
In theory, the PMDB – still the
country’s largest party – and other
smaller parties could play a pivotal
role. Unfortunately for Alckmin,
Lula, the PT and the pro-Lula wing
of the PMDB have engaged in
significant political maneuvering to
bolster Lula’s chances for a firstround victory. Additionally, due to
changes in Brazilian electoral rules,
the smallest parties will play a very
marginal role this year, if any.
Nevertheless, it is not beyond the
realm of possibility that the ultraleft-wing senator Heloísa Helena
(PSOL) can secure 10% of the total
popular vote. If she fails to do so,
Lula’s chances for a first-round
victory rise sharply.
Assuming that Lula is likely to
win, the next question becomes how
much support he will be able to
muster in Congress. At present, the
numbers do not bode well for him
in a second term. In 2002 the PT
elected 92 federal deputies. It
would be quite remarkable if the
party did as well in 2006, given the
abundant evidence of corruption
that surfaced during last year’s
political crisis.
Whatever support Lula gets from
the PMDB will be not only fractional,
but also very costly. The other sizable
cross-section of his support base is
comprised of several mid-sized political parties, including the PTB, PL and
PP. These parties were also deeply
involved in the mensalão votes for
cash scandal. This is the same coalition that Lula was able to put together
in 2002. As a result, it is unlikely that
he will be able to secure passage of
needed but unpopular new legislation
in order to balance the social security
deficit, streamline the tax system and
deregulate the labor market.
So what can Lula do? It would
be a miracle if the two major opposition parties (the PSDB and the PFL)
returned to the collaborative stance
they took back in 2003 – a virtuous
political cycle that was interrupted
by the first corruption case involving
Waldomiro Diniz. A landslide victory
in the first round might be a way for
Lula to generate much needed political capital in a second term. ■
By Bolivar Lamounier,
Senior Partner at Augurium
Consultoria, a consultancy
specializing in Brazilian and Latin
American politics, based in São Paulo.
(Email: [email protected])
Connect with Potential Clients Online!
Publicize your company’s website on the Chamber site. For more information,
call (212)751-4691 or e-mail: [email protected]
MAY / JUNE 2006 / VOL. 41 NO. 3
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23
2006 PERSON OF THE YEAR AWARDS Continued from page 1
A Resounding Success
POY
n the evening of May
18th, more than 800
distinguished guests from the
United States, Brazil and other
nations gathered at the highly
anticipated 2006 Person of the
Year Awards Dinner, held in
the Grand Ballroom of the
Waldorf=Astoria Hotel in New
York City.
O
The international business,
financial and diplomatic communities convened once again at
this traditional gala event to pay
tribute to this year’s honorees:
Roger Agnelli, President and
CEO of Companhia Vale do Rio
Doce, and Paul M. Anderson,
Chairman and CEO of Duke
Energy. This prestigious award
is presented annually to two
innovative and forward-thinking
leaders from Brazil and the
United States who have helped
forge closer ties between the two
nations. Over the past three and
a half decades, this annual event
has become one of the most
important business and social
gatherings in New York City.
OY
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[email protected]
MAY / JUNE 2006 / VOL. 41 NO. 3
POY
2006 Person of the Year Awards
24
Photo Gallery
1
3
2
Scenes from the 2006 Person of the Year Award Dinner, held
Thursday, May 18 at the Waldorf=Astoria Hotel in New York City.
1: Roger Agnelli and family.
2: Roger Agnelli and Richard Aldrich, Jr.
3: Paul Anderson and Richard Aldrich, Jr.
MAY / JUNE 2006 / VOL. 41 NO. 3
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25
Photo Gallery
5
4
6
4: Roger Agnelli and Vicente Bonnard.
5: General Manoel Luis Valdevez Castro and Vicente Wright.
6: Sergio Pereira, Vicente Bonnard, Yolanda Coimbra and Roger Agnelli.
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[email protected]
MAY / JUNE 2006 / VOL. 41 NO. 3
26
Photo Gallery
8
7: Lucio and Maria Helena Pimenta.
8: Ambassador José Alfredo Graça Lima.
7
MAY / JUNE 2006 / VOL. 41 NO. 3
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27
Photo Gallery
9
10
11
9: Vicente Bonnard, Carmen and Carlos Alberto Vieira.
10: Former President Fernando Henrique Cardoso, Luiz Eulálio de Bueno Vidigal
and Former President José Sarney.
11: Celso and Miriam Barison.
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[email protected]
MAY / JUNE 2006 / VOL. 41 NO. 3
28
Photo Gallery
1
2
3
4
Scenes from a luncheon in honor of Minister George Prata, Deputy Consul General of Brazil in New York,
held on May 23rd at the Racquet & Tennis Club in New York. On this occasion, Minister Prata was
recognized for his outstanding and continuing support and service to the members of the Brazilian-American
Chamber of Commerce, Inc. and to the Brazilian community in New York.
1. Vicente Wright and Valmor Bratz.
2. Celso Barison, Lucio Pimenta and Paul Aufrichtig.
3. Charles Achoa, Jr., Sueli Bonaparte and Valmor Bratz.
4. Lucio Pimenta, Miriam and Minister George Prata.
MAY / JUNE 2006 / VOL. 41 NO. 3
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29
Photo Gallery
5
6
7
5. Minister Fred Arruda, Jônice Tristão, Sergio Pereira and John Landers.
6. Ricardo Lima and Lino Bohn.
7. Celso Barison, Vicente Bonnard and José Roberto de Azevedo.
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[email protected]
MAY / JUNE 2006 / VOL. 41 NO. 3
30
Photo Gallery
8
9
10
8. Ricardo Lima, Vicente Bonnard, Minister George Prata and Sergio Pereira.
9. Minister George Prata and Miriam Prata.
10. Sueli Bonaparte, Miriam Prata and Renata Neeser.
MAY / JUNE 2006 / VOL. 41 NO. 3
[email protected]
www.brazilcham.com
31
Photo Gallery
11
11: Vicente Bonnard, Minister George Prata,
Miriam Prata, Sergio Pereira, Ricardo
Lima and Lucio Pimenta.
12. General Manuel Luis Valdevez Castro
and Lino Bohn.
13. Jônice Tristão, Vicente Wright, Lucio
Pimenta and Ambassador Gilberto
Coutinho Paranhos Velloso.
12
13
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MAY / JUNE 2006 / VOL. 41 NO. 3
32
Photo Gallery
14
9
17
16
14: Sergio Pereira, General Manuel Luis Valdevez Castro, Minister George Prata and Vicente Bonnard.
15: Minister Fred Arruda and Renata Neeser.
16: Miriam Prata and Jônice Tristão.
17: José Roberto de Azevedo, General Manuel Luis Valdevez Castro and Efrem Daumas.
MAY / JUNE 2006 / VOL. 41 NO. 3
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www.brazilcham.com
33
Photo Gallery
1
3
2
Scenes from a breakfast meeting with H.E. Dilma Rousseff, Chief of Staff of the Brazilian
Presidency, held on May 1st at the University Club in New York.
1: Ambassador Ronaldo Mota Sardenberg, Ambassador Gilberto Coutinho Paranhos Velloso,
Minister Dilma Rousseff, Ambassador Roberto Abdenur and Ambassador José Alfredo Graça Lima.
2: Nathalie Hoffman, John Welch and Lisa Schineller.
3: Minister Dilma Rousseff, Sueli Bonaparte and Ambassador Roberto Abdenur.
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MAY / JUNE 2006 / VOL. 41 NO. 3
34
Photo Gallery
4
5
6
4: John Welch and Minister Dilma Rousseff.
5: Marcello Hallake, Vanessa Simone Pereira and Marcio Baptista.
6: Guilherme Ferreira, L. Gilles Sion, Aron Dantzig and Pablo Marino.
MAY / JUNE 2006 / VOL. 41 NO. 3
[email protected]
www.brazilcham.com
35
Photo Gallery
1
2
3
Scenes from a breakfast briefing on Brazil’s
forthcoming presidential election from the
perspective of the Wall Street ratings firms.
The event was held on May 2nd at Proskauer
Rose LLP in New York.
1: Lisa Schineller, Ambassador José Alfredo
Graça Lima, John Welch, Christian Stracke
and Roger Scher.
2: Ted Helms and Ricardo Amorim.
3: Donatella Keohane, Paulo Batalha and
Christian Stracke.
4: Evaldo Freire, Ambassador José Alfredo
Graça Lima and Minister Fred Arruda.
4
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MAY / JUNE 2006 / VOL. 41 NO. 3
36
Photo Gallery
2
1
3
4
5
Scenes from the business networking reception held
on May 3rd at Churrascaria Plataforma Tribeca in
New York.
1. Paul Gonzales, Mitchell Mandell and Barry Fischer.
2. Liz Carvalho, Steven Kargman and Jussara Schiefer.
3. Roger Correa and Lucia Cano.
4. Talita Moss and Kalina Molina.
5. Emery Ventura and Mario Chuman.
6. Flavia Cesar, Lucy Orozco and Sidney Weiss.
6
MAY / JUNE 2006 / VOL. 41 NO. 3
[email protected]
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37
Photo Gallery
2
1
3
4
Scenes from the Membership Committee’s welcome
breakfast for new members hosted by Thelen Reid &
Priest LLP on May 9th in New York.
1. José Villar, Raffaela Coelho and Gabriela Labouriau.
2. Jayme Bulcão and Roger Lorence.
3. Dora Fiala and Peter Lyons.
4. Mark Engel, Flavia Cesar and Gregg Butler.
5. Gabriela Labouriau and Daniel Kalansky.
5
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MAY / JUNE 2006 / VOL. 41 NO. 3
38
Photo Gallery
2
1
Scenes from the Young Professionals happy
hour held on May 25th at the W Hotel in
New York.
1. Humberto Santos and Ana Karina Souza.
2. Mark Engel and John Markunas.
3. Saboor AbdulJaami and Lucy Orozco.
3
Scene from Cuban Day Parade Outing of
the Latin American Kiwanis on May 31st
in Franklin Lakes, New Jersey.
Michael Mays (the son of baseball great
Willie Mays), Natalia Quesada of American
Airlines, Roberto Clemente, Jr. (the son of
baseball great Roberto Clemente), Emilio Del
Valle, head of the Cuban Day Parade group,
Peter D. Aufrichtig and James Quinn.
MAY / JUNE 2006 / VOL. 41 NO. 3
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39
Photo Gallery
1
2
3
Scenes from a breakfast on "Investment Opportunities in Brazil’s Public-Private Partnerships" with
Demian Fiocca, President of the Brazilian Development Bank (BNDES), held on June 14th at Shearman &
Sterling LLP in New York.
1. Eduardo Pupo, Demian Fiocca, Sueli Bonaparte, Sergio Millerman and Minister Fred Arruda.
2. Minister Fred Arruda, Eduardo Pupo and Francesco Mario Sirangelo.
3. Demian Fiocca and Lionel Zaclis.
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MAY / JUNE 2006 / VOL. 41 NO. 3
40
Photo Gallery
4
5
6
4: Eduardo Pupo, Demian Fiocca,
Minister Fred Arruda and Paulo Batalha.
5: Sergio Millerman and Eduardo Pupo.
6: Vanessa Simone Pereira, Marun Jazbik
Filho and Flávia Dezotti-Hallake.
7: Lester Birenbaum, Oscar Urizar and
Felix Quinteros.
7
MAY / JUNE 2006 / VOL. 41 NO. 3
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41
Photo Gallery
8
9
10
11
8.
9.
10.
11.
www.brazilcham.com
Felipe Creazzo and J. Anthony Girolami.
Veronica Foley, Guilherme Tepedino and Gregg Roberts.
John Markunas and Suzana Martinez.
Jean Ergas and James Brodt.
[email protected]
MAY / JUNE 2006 / VOL. 41 NO. 3
42
New Members
Contributing:
HEWLETT-PACKARD
FINANCIAL SERVICES
5200 Blue Lagoon Drive, Suite 950
Miami, FL 33126
Tel: (305) 269-5439
Fax: (305) 265-6075
www.hp.com
Corporate:
BAACH ROBINSON & LEWIS
PLLC
1201 F Street, NW, Suite 500
Washington, D.C. 20004
Tel: (202) 833-8900
Fax: (202) 466-5738
www.baachrobinson.com
CONTROL RISKS
19 West 44th Street, Suite 412
New York, NY 10036
Tel: (212) 967-3955
Fax: (212) 967-3956
www.control-risks.com
CREDITSIGHTS, INC.
470 Park Avenue South, 12th Floor
New York, NY 10016
Tel: (706) 828-7988
www.creditsights.com
HOLLYREALESTATE
1442 Garden Road
Weston, FL 33326
Tel: (954) 854-3287
www.hollyre.com
HUNTON & WILLIAMS LLP
Riverfront Plaza, 951 East Bird Street
Richmond, VA 23219-4074
Tel: (804) 788-8637
Fax: (804) 788-8218
www.hunton.com
INTEGRATED FINANCE LTD.
630 Fifth Avenue, Suite 2750
New York, NY 10111
Tel: (212) 209-9815
Fax: (212) 209-9892
www.ifltd.com
LAND AMERICA FINANCIAL
GROUP, INC.
Two Grand Central Tower,
140 East 45th Street
New York, NY 10017
Tel: (212) 220-7006
Fax: (212) 986-3215
www.landam.com
MAY / JUNE 2006 / VOL. 41 NO. 3
NRG ENERGY INC.
211 Carnegie Center Drive
Princeton, NJ 08540-6213
Tel: (609) 524-4680
Fax: (609) 524-4605
www.nrgenergy.com
XL CAPITAL ASSURANCE
1221 Avenue of the Americas
New York, NY 10020
Tel: (212) 478-3451
Fax: (212) 478-3587
www.xlca.com
SHERWIN-WILLIAMS DO
BRASIL IND. E COM. LTDA
Av. Ibirama, 480
06785-300 Taboão da Serra, SP
BRAZIL
Tel: (55-11) 4788-5101
Fax: (55-11) 4788-5013
www.sherwin.com.br
XOOM.COM
425 Brannan Street, 2nd floor
San Francisco, CA 94107
Tel: (415) 281-4255
Fax: (415) 777-8690
www.xoom.com
THE NEW YORK MORTGAGE
CO. LLC
333 Westchester Avenue, Suite ET102
White Plains, NY 10604
Tel: (914) 733-7900 ext. 166
Fax: (914) 733-7910
www.nymc.com/rhogan
TROUTMAN SANDERS LLP
The Chrysler Building
405 Lexington Avenue
New York, NY 10174
Tel: (212) 704-6336
Fax: (212) 704-8330
www.troutmansanders.com
UBS
299 Park Avenue, 33rd Floor
New York, NY 10171
Tel: (212) 821-3942
Fax: (212) 821-3938
www.ubs.com
URÍA MENÉNDEZ
1114 Avenue of the Americas,
36th Floor
New York, NY 10036
Tel: (212) 593-1300
Fax: (212) 593-7144
www.uria.com
US HELICOPTER
150 East 42 Street, 4th Floor
New York, NY 10128
Tel: (212) 922-1366
Fax: (212) 867-7162
www.flyush.com
WOMBLE CARLYLE
SANDRIDGE & RICE, PLLC
One Atlantic Center Suite 3500
1201 West Peachtree Street
Atlanta, GA 30309
Tel: (404) 888-7452
Fax: (404) 870-8224
www.wcsr.com
[email protected]
Member:
ACHEIUSA NEWSPAPER
816 SE 9th Street, Suite E
Deerfield Beach, FL 33441
Tel: (954) 570-7568
Fax: (954) 419-9717
www.acheiusa.com
BRAZIL STATION
304 Park Avenue South, 11th Floor
New York, NY 10010
Tel: (646) 287-6645
Fax: (215) 689-6122
www.brazil-station.com
CHANNEL TRANSLATIONS, LLC
33 McCampbell Road
Holmdel, NJ 07733
Tel: (888) 626-0320
Fax: (732) 530-3912
www.channeltranslations.com
COMMERCIAL VENTURES
CO., LLC
122 Main Street
New Britain, CT 06051
Tel: (806) 224-2877
Fax: (860) 224-6668
COSTA PROPERTIES &
MANAGEMENT INC.
39 N. Main Street
Port Chester, NY 10573
Tel: (914) 934-5001
Fax: (914) 934-5027
www.contracostaproperties.com
JONATHAN S. SANOFF,
COUNSELOR AT LAW
211 West 56th Street
New York, NY 10019
Tel: (212) 265-3166
Fax: (212) 265-6862
www.brazilcham.com
43
ALSTON & BIRD is at the forefront of law firms providing legal
counsel to businesses worldwide. The
firm’s unique culture and core values
have been developed and maintained
for more than a century. The firm
prides itself on its professional
excellence, collegiality, teamwork,
loyalty, diversity, fairness, as well as
client and employee satisfaction.
Alston & Bird’s forward-thinking
culture is the foundation for its
diverse practice capabilities, the
complementary structure of its network of offices and its successes to
date. The firm’s selection by Fortune
as one of the “100 Best Companies
to Work For®” for seven years in a
row further demonstrates the unique
culture of Alston & Bird.
With more than 700 attorneys
and offices in Atlanta, Washington,
D.C., New York City, Charlotte and
the Research Triangle in North
Carolina, the firm provides a full
range of services to domestic and
international clients conducting
business around the world. Alston &
Bird’s legal counsel encompasses
corporate, intellectual property,
litigation and tax services with niche
practices in legislative and public
policy, homeland security and health
care. With two former Senate
Majority Leaders – Bob Dole and
Tom Daschle – in our Washington
DC office, the firm’s clients have
access to counsel on how businesses
and government can work together.
Alston & Bird’s lawyers have
extensive experience providing legal
counsel on cross-border transactions,
including numerous transactions in
Brazil, encompassing tax, environmental, intellectual property,
employee benefits issues and other
aspects unique to international deals.
www.alston.com
arbitration, mediation, litigation and
trial. Clients include major national
and multinational companies, the
London insurance market, domestic
and international financial institutions, hedge funds and major legal
and accounting firms as well as individuals in government, law, finance,
business and media. The firm’s
clients rely on Baach Robinson &
Lewis for advice and litigation to
help solve critical problems.
Baach Robinson & Lewis
attorneys are experienced in solving
transnational legal problems, particularly in the fields of international
insolvency, fraud, asset tracing,
insurance, reinsurance and complex
financial disputes. The firm has
acted as US counsel to the liquidators
of the Bank of Credit and Commerce
International (BCCI). In the course
of that representation, the firm won
one of the largest RICO/fraud
verdicts ever against a former Saudi
Arabian government official; handled
the largest criminal asset forfeiture
matter in US history; and supervised
an asset recovery effort against a
fugitive from US justice involving
litigation in 13 countries.
As part of the firm’s litigation
expertise, Baach Robinson & Lewis
attorneys are also skilled in settlement
and alternative dispute resolution.
The firm is a member of the International Business Law Consortium
and maintains close working
relationships with leading law firms
around the world, including a prominent law firm in Brazil with whom
Baach Robinson & Lewis has
worked successfully on numerous
matters. For further information on
Baach Robinson & Lewis PLLC,
please visit the firm’s website at
www.baachrobinson.com or contact
the firm at (202) 833-8900.
www.baachrobinson.com
BAACH ROBINSON & LEWIS
PLLC is a Washington-based, international law firm that focuses on
the resolution of disputes through
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BRAZILIAN LEGAL CENTER
(Centro Jurídico Brasileiro - CJB)
was established by a group of
[email protected]
lawyers, law professors and jurists,
with the objective of developing
studies and carrying out research in
all fields of law. Its main objectives
are to seek out the best interpretation
of existing legislation, to deepen
knowledge of the doctrine and to
determine and record jurisprudence,
in order to improve the practice of
law in general.
Among its members are former
Justices of the Brazilian Supreme
Court and magistrates of higher
courts, law professors, practicing
attorneys and former diplomats.
CJB members may, individually
or in partnership, hire third parties to
secure the most effective guidance to
resolve challenging legal disputes.
CJB seeks interdisciplinary cooperation among lawyers, consultants and
specialists in order to analyze and
resolve the issues referred to the
organization in the most efficient
and strategic manner possible.
CJB new 12-story headquarters,
currently under construction, will
open in early 2008 to house lawyers’
offices, a legal bookstore and
library, as well as facilities for seminars, workshops and meetings devoted to the study of law.
[email protected]
CLEARSTREAM BANKING is an
integral part of the Deutsche Borse
Group. Clearstream offers settlement
and custody services to more than
2,500 customers worldwide, covering
over 150,000 domestic and internationally traded bonds and equities.
Clearstream's core business ensures
that cash and securities are promptly
and effectively delivered between
parties, and that customers are always
notified of the rights and obligations
attached to the securities they keep
under the company’s custody.
Clearstream’s Representative
Office in New York maintains strong
links to counterparts in 40 domestic
markets, ensuring the timely and
MAY / JUNE 2006 / VOL. 41 NO. 3
Corporate Profiles
44
CORPORATE PROFILES Continued from page 43
secure transfer of securities ownership and matching payment. Backed
by flexible securities lending and
collateral management services,
Clearstream offers one of the most
comprehensive international securities services available, settling more
than 250,000 transactions daily.
Clearstream maintains strong
long-term ratings from major international rating agencies (AA from
both Standard & Poor's and Fitch),
which demonstrates Clearstream's
focus on risk management and
operational efficiency.
www.clearstream.com
COOKSON ELECTRONICS
provides high-performance materials
as well as chemistry and technology
solutions to the electronics and surface
finishing industries worldwide,
including Brazil. The company
delivers superior value by providing
differentiated products, services and
support through its Alpha, Enthone
and Cookson Electronics businesses.
The company’s products and services
range from printed circuit board
fabrication and assembly products, to
microelectronics packaging materials
and semiconductor fabrication
processes, to high performance
functional and decorative coatings.
Cookson Electronics’ manufacturing
and service centers in São Paulo and
Manaus provide total sales and
process support.
Alpha's superior product technologies and global technical support
meet the changing needs of electronic
assembly companies. The company
offers a full line of products, including solder paste and stencils, wave
flux, soldering alloys, solder preforms,
cored wire, cleaning chemistries,
CoolCap thermal management, and a
complete line of lead-free products.
Cookson Electronics Semiconductor Products is the premier
material supplier to the semiconductor
packaging industry for area array
and flip chip packages. As such, the
MAY / JUNE 2006 / VOL. 41 NO. 3
company is uniquely positioned to
provide total process solutions to
its customers.
Enthone® functional coatings
are critical components on virtually
every car, truck and bike on the road
today. If it rolls, flies, sails or moves,
Enthone is there. The company’s
coatings deliver corrosion protection
and wear resistance on automotive
parts, oil and gas industry equipment,
medical instruments, aerospace and
other industrial components. Enthone
conversion coatings, topcoats and
seals improve the quality, appearance
and corrosion performance of ferrous
metals used for automotive components, building hardware and fasteners.
Enthone® decorative coatings make
trumpets shine and jewelry sparkle.
And as parts become lighter, valueadded Enthone processes become
more popular. From automobile
grills, textile clothing fasteners,
watches, spectacle frames, high
fashion accessories, metal furniture,
household appliances and musical
instruments, Enthone decorative
plating processes make them look
and work their best!
www.cooksonelectronics.com
DELTA AIR LINES, INC., traces
its roots back to 1924, when Huff
Daland Dusters was founded as the
world's first aerial crop dusting
organization. In 1928 the company
became Delta Air Service. On June
17, 1929, Delta inaugurated its first
passenger flights over a route
stretching from Dallas, TX to
Jackson, MS, via Shreveport and
Monroe, LA. In 1941, the company
moved its headquarters from Monroe
to Atlanta, GA.
Since the founding of Delta Air
Lines, the company has stood for
safe and reliable air transportation,
distinctive customer service and
hospitality from the heart. The
company’s vision is to build on its
traditions and always meet its
customers' expectations while taking
service to even higher levels of
[email protected]
excellence. Delta is a leader in the
business it knows best – airline
transportation. Delta intends to be an
even greater company and will focus
its time, attention and investments on
building that leadership. The company
is dedicated to being the best airline
in the eyes of its customers. Delta
will provide value and distinctive
products to its customers, a superior
return for investors, and challenging
and rewarding work for Delta people
in an environment that respects and
values their contributions.
Delta Air Lines (Other OTC:
DALRQ) is one of the world’s
fastest growing international carriers
with more than 50 new international
routes added or announced in the
last year. Delta offers flights to 447
destinations in 96 countries on
Delta, Delta Shuttle, the Delta
Connection carriers and its worldwide partners. In summer 2006,
Delta plans to offer customers more
destinations and departures between
the US, Europe, India and Israel
than any global airline (from the US
based on July 2006 OAG), including
service on 11 new transatlantic
routes from its Atlanta and New
York-JFK hubs. Delta also is a major
carrier to Mexico, South and Central
America and the Caribbean, with
nearly 40 routes announced, added
or solicited since January 1, 2005.
Delta's marketing alliances also
allow customers to earn and redeem
SkyMiles on more than 14,000
flights offered by SkyTeam and other
partners. Delta is a founding member
of SkyTeam, a global airline alliance
that provides customers with extensive worldwide destinations, flights
and services. Customers can check
in for flights, print boarding passes
and check flight status at delta.com.
EXTRA COMMUNICATIONS,
LLC publishes Extra Newspaper,
an innovative Portuguese-language
publication based in the US. Founded
in August 2005, the company is led
www.brazilcham.com
45
www.extrausa.net
GEOTEXT TRANSLATIONS Since its establishment in 1997,
Geotext has become the premier
translation company dedicated to the
foreign-language needs of legal
professionals. The company’s focused
approach to serving the legal community has proven successful, as more
than 600 law firms and corporate
legal departments worldwide have
come to rely on Geotext, including
84 of the top 100 firms worldwide.
From its headquarters in New York,
and offices in San Francisco, London,
and Hong Kong, the company handles
the foreign language needs of legal
professionals across the country and
on five continents.
Geotext works exclusively with
translators qualified to undertake the
task of translating for attorneys. In
addition to having a superior command of their languages, all of the
company’s translators specialize in
such fields as law, finance, science
and technology. The company’s
professionals have broad expertise in
the subject matter they are translating,
from intellectual property to investment banking to corporate litigation.
As a result, clients can rely on the
company’s accuracy.
Geotext’s extensive resources,
unyielding commitment to quality and
superior project management have
made it a leader in the industry. It is
the translation company to which law
firms and corporations turn when
faced with the need to provide documentation in multiple languages for a
multi-billion dollar merger or 10,000
pages of discovery documents.
In addition, Geotext takes pride
in its reputation for speed and
responsiveness. Translators, project
managers and proofreaders will
work through the night, over the
weekend, or during a holiday to meet
clients’ needs. Geotext can also
place professional interpreters at
your office or anywhere in the world
on short notice. Over the years,
Geotext has built an exceptionally
strong team of superior Brazilian
Portuguese and Latin American
Spanish translators. Their familiarity
with the cultures and legal systems
of Brazil and Latin America ensures
that the quality of Geotext’s work is
consistently outstanding.
[email protected]
HP FINANCIAL SERVICES
(HPFS) provides seamless and
customized leasing, financing, asset
recovery and financial lifecycle
management services to customers
worldwide. HPFS is the industry
leader in delivering global customized
leasing and financial asset management solutions that simplify customers'
IT lifecycle management, reduce
risk, and increase the return on IT
investments. A wholly-owned
subsidiary of the Hewlett-Packard
Company, HPFS has employees in
51 countries and more than $9 billion
in assets. The company serves all
types of enterprises including banks,
television stations, hospitals, governmental agencies and educational
institutions.
HP Financial Services helps
customers increase their performance
and agility with flexible programs to
help you transition from a legacy
system to a new HP solution, recover
assets, manage your IT infrastructure
and refurbish, recycle or dispose of
assets as required.
HP Financial Services offers a
broad range of leasing and financial
asset management services with critical competitive differentiators such
as the ability to implement seamless
solutions on a global basis. The
company offers an industry-leading
range of highly customizable capabilities and innovative offerings such
as Pay per use, enabling customers
to pay according to their individual
level of usage.
www.hp.com
JONATHAN S. SANOFF is an
international commercial lawyer
with 20 years of experience in Latin
America. He offers large-firm
expertise, with small-firm economy
and personal attention. A specialist
in complex litigation and arbitration,
he has successfully represented
emerging markets participants, venture capital firms, corporations and
individual investors in the US and
abroad. In April 2006, Jonathan
became the New York correspondent
for the leading Brazilian law firm of
Tostes e Associados Advogados, with
offices in Rio, São Paulo and Brasília.
Of particular interest to Chamber
members, Jonathan recently represented the pension fund Aerus in the
Varig reorganization, where he assisted
in arranging an unprecedented joint
hearing held by Brazilian and US
www.brazilcham.com
[email protected]
MAY / JUNE 2006 / VOL. 41 NO. 3
by Eli Nascimento and journalist
Nilza Barros. Extra Newspaper is a
socially-responsible communication
vehicle that fosters community
development. The publication focuses
on diversity and pluralism, developing democratic relationships with a
diverse readership, defending freedom
of expression and ensuring ethical
business practices.
The publication’s content
includes in-depth interviews, political
coverage, Brazilian economic news,
as well as international news,
business, real estate, culture and
entertainment. Extra Newspaper also
includes special editorials, op-eds
and guest articles from a wide variety
of media experts. The publication’s
current readership includes businesspeople and other professionals,
students, artists, intellectuals,
community organizations and others.
The newspaper is distributed in
New York, New Jersey and Connecticut. Currently printing 40,000
copies per month, the company is
finalizing plans to expand distribution to Pennsylvania, Massachusetts
and Florida. Our motto, “Respeito
pelo Leitor – Respect for the
Reader” has become a guiding
principle for the organization.
46
bankruptcy judges. He was a principal member of the team representing
Petrobras in federal court litigation
over the construction and financing
of two of the largest off-shore
production platforms, resulting in the
recovery of approximately $250 million. His close work with the Tostes
firm in both matters was the foundation for their new joint venture.
Jonathan has served on committees of the New York City Bar
Association, holds a master of law
degree in international law, and has
published articles on a variety of
issues related to international arbitration. He is fluent in Spanish and
proficient in legal Portuguese.
[email protected]
LANDAMERICA FINANCIAL
GROUP, INC. is a leading provider
of real estate transaction services.
Headquartered in Richmond, Virginia,
the companies of LandAmerica
Financial Group, Inc. (NYSE:LFG)
have been completing and protecting
the nation’s real estate investments
for over 125 years.
Through its many subsidiaries,
LandAmerica serves residential and
commercial customers, providing
title insurance as well as a broad
range of real estate transaction services. The company operates through
more than 900 offices and a network
of 10,000 active agents in the United
States, Europe, Canada, the
Caribbean, Mexico, Brazil and other
parts of Latin America. LandAmerica
customers include mortgage lenders,
real estate developers and brokers,
attorneys, and homebuyers. LandAmerica maintains some of the largest
title insurance companies in the
industry, such as: Commonwealth®
Land Title Insurance Company;
Lawyers Title Insurance
Corporation®; Transnation® Title
Insurance Company; and Title
Insurance Company of America.
LandAmerica International,
based in New York City, operates as
a seamless resource, providing title
insurance and related services
around the globe to its commercial
customers. The companies that come
together to create LandAmerica are
united by their commitment to making
the real estate transaction more
effective, more efficient, and more
fulfilling for everyone involved.
LandAmerica is recognized on
Fortune magazine’s 2006 list of
America’s most admired companies
and is ranked as a Fortune 500 and
Forbes Platinum 400 company.
www.LandAm.com
PATRINELY GROUP develops
residential and office projects that
incorporate sophisticated building
technology and the highest quality
design details. Since its establishment
in 1983, it has prided itself on
creating buildings that are both
elegant and function at the highest
level of efficiency. Over the past 20
years, the team has completed projects
totaling more than $2 billion and
resulting in some of the most
respected and successful properties
in the nation. The company currently
has projects valued at nearly $1 billion
under development.
The firm selectively creates
luxury residential condominiums in
premier communities and resort
areas. It strives to develop the finest
residences available in each market
in which it operates, creating a true
urban lifestyle where residents enjoy
dining, shopping and entertainment
within walking distance. Patrinely
Group also has a long and successful
track record developing and acquiring
office buildings throughout the
United States, and is renowned for
creating state-of-the-art office complexes for corporate clients such as
American Century, Anadarko, BP,
DHL, FedEx, Halliburton and IBM.
Currently active in Arizona,
Colorado, Florida, Maryland, New
Jersey, Texas and Virginia, Patrinely
Group is a subsidiary of Crimson
Capital, Ltd., a national real estate
merchant banking firm, of which
Mr. Dean Patrinely is Chairman and
Mr. Len O’Donnell is President &
CEO. Both of these principals have
taken an extremely active role in
every aspect of the Saxony project in
Miami Beach and they are committed
to the successful execution of even
the smallest details of the initiative.
www.thesaxony.com
RIBO LLC is an import-export
company with 10 years of experience in the metropolitan New York
area, serving both Brazilian and nonBrazilian clients by providing safe
and efficient transportation of their
goods to any city in Brazil from all
around the world.
With offices and a distribution
warehouse in Rio de Janeiro, the
company’s number one priority is to
offer the best service to its clients.
The company’s staff speaks fluent
English, Portuguese and Spanish to
answer any question you might have.
www.ribollc.com
Newsbulletin Advertise in our bimonthly publication
For information, call (212) 751-4691
MAY / JUNE 2006 / VOL. 41 NO. 3
[email protected]
www.brazilcham.com
47
The company is highly experienced
at providing unmatched individualized attention and building long-term
relationships. The company is
responsive to meeting and anticipating
its clients’ banking and financial
services needs. The organization’s
motto “Our doors are open all the way
to the top,” is more than a slogan. It
is the way Sterling does business.
www.sterlingbancorp.com
WOMBLE CARLYLE is one of the
largest law firms in the mid-Atlantic
and Southeastern regions of the
United States, as well as one of the
most technologically advanced.
Founded in 1876, the firm employs
more than 500 lawyers in ten offices.
Womble Carlyle’s commitment
to the zealous representation of its
clients has been the driving force
behind its international development.
The firm’s International Practice is a
natural consequence of the dramatic
growth of the Southeastern region of
the United States. Many of the states
in the region are working aggressively
to attract foreign business and trade,
and Womble Carlyle’s development
has paralleled those efforts.
The firm’s International Practice
draws upon substantial resources:
years of international experience;
foreign language skills; commitment
to its clients’ businesses; state-ofthe-art technology; and secure
extranets which permit clients to
access documents and communicate
with the firm 24 hours a day from
any time zone.
The firm’s client base is growing
in Latin America and particularly in
Brazil. Womble Carlyle lawyers,
fluent in Portuguese and Spanish,
regularly assist clients in Argentina,
Brazil, Chile, Mexico and other
Latin American countries in matters
such as market entry/strategic
alliances; joint ventures/cross-border
investment; global contracting;
mergers & acquisitions; capital
markets; intellectual property; data
privacy; and the sale and distribution
of goods.
www.wcsr.com
NEW MEMBERS Continued from page 42
KINSALE ENERGY LLC
6 Mead Point Drive
Greenwich, CT 06830
Tel: (203) 622-4110
Fax: (203) 622-4510
MICHIGAN FINANCIAL &
INTERNATIONAL TRADING, LLC
38908 Dequindre Road
Sterling Heights, MI 48310
Tel: (586) 268-5756
Fax: (586) 268-4007
RIBO LLC
147 West 35th Street, Suite 303
New York, NY 10001
Tel: (212) 216-9068
Fax: (212) 216-9069
www.ribollc.com
Is your printing company
Killing you with.....
Quality Issues,
Late Deliveries,
Additional Charges.....
Our customers do business with us because they get
quality, on time deliveries, no pricing surprises and
someone who ALWAYS calls you back.
GALVANIC PRINTING & PLATE CO., INC.
and No One calls you back?
www.brazilcham.com
50 Commercial Avenue • Moonachie, NJ 07074
201 939-3600 201 460-7866 fax
Visit our website at www.galvanicprinting.com
[email protected]
i nting company?
Tired of the same old runaround from your pr
MAY / JUNE 2006 / VOL. 41 NO. 3
STERLING BANCORP (NYSE:
STL) is a financial holding company
with assets of $2 billion, offering a
broad array of banking and financial
services products. Its principal banking subsidiary is Sterling National
Bank, founded in 1929. Sterling
provides a wide range of products
and services, including business and
consumer loans, commercial and
residential mortgage lending and
brokerage, asset-based financing,
factoring, trade financing, equipment
leasing, corporate and consumer
deposit services, trust and estate
administration, and investment
management services. The company
has operations in New York, New
Jersey, Virginia and North Carolina
and conducts business throughout
the US.
Sterling Bancorp's mission is to
create long-term value for its shareholders. The organization has
delivered on that mission statement
by building an outstanding financial
services company capable of delivering premium services, with a personal
touch, to its customers and clients.
Brazilian-American Chamber of Commerce, Inc. – NEWSBUL-
SAVE THE DATE
AUGUST 2 BUSINESS NETWORKING RECEPTION
Proskauer Rose LLP
New York City
SEPTEMBER 8 BRAZIL INDEPENDENCE DAY RECEPTION
The Racquet & Tennis Club
New York City
SEPTEMBER 18 2006 BRAZIL ECONOMIC CONFERENCE
The Capital Tower
Singapore
OCTOBER 14 MASS IN CELEBRATION OF THE PATRON SAINT OF
BRAZIL, NOSSA SENHORA DA APARECIDA
St. Patrick’s Cathedral
New York City
DECEMBER 8 ANNUAL HOLIDAY GALA DINNER DANCE
The New York Palace
New York City
DECEMBER 18 HOLIDAY RECEPTION FOR MEMBERS ONLY
The Racquet & Tennis Club
New York City
IF YOU ARE INTERESTED IN SPONSORING AN EVENT,
CONTACT THE CHAMBER EXECUTIVE DIRECTOR SUELI BONAPARTE
([email protected]) FOR ADDITIONAL INFORMATION.
Brazilian-American Chamber of Commerce, Inc.
509 Madison Avenue, Suite 304, New York, NY 10022

Person of the Year Awards - The Brazilian

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