São Paulo – The federal government elaborated a study in which it reviews challenges, lists successful cases and presents proposals to promote the expansion of Brazilian companies abroad. Entitled “Term of Reference: Internationalization of Brazilian Companies,” the document was disclosed yesterday (7th) during a seminar on the matter at the Federation of Industries of the State of São Paulo (Fiesp).
The study points out challenges to be met and strategies for preventing capital flight, job exports and reduction of domestic investment compared with investment in foreign countries. On the other hand, it also mentions important benefits for internationalized companies.
“Direct investment by Brazilian companies creates conditions for exports and direct sales of differentiated products in foreign countries, enabling the creation of distribution logistics and making it easier to carry out just-in -time operations [a concept related to on-demand production, by which one sells the product first, and then manufactures or assembles it],” according to the document.
The text also explains that “at the same time, the process of internationalization brings companies and clients together by means of maintenance operations, after sales services, among others. Thus, you may say that foreign direct investment is a key factor for company expansion.”
Addressing the context of internationalization of companies in Brazil, the document also mentions a study by the Boston Consulting Group, made this year, which lists 14 Brazilian companies among the 100 new global challengers. They are: Camargo Corrêa, Coteminas, Embraer, Gerdau, JBS-Friboi, Marcopolo, Natura, Odebrecht, Perdigão, Petrobras, Sadia, Vale, Votorantim and WEG.
Case studies in countries such as South Korea, Taiwan, China and India are listed as examples, with regard to actions taken by local governments to support the internationalization of their companies.
“In 2002, the Chinese government launched the Go Global policy, with measures to promote the internationalization of companies in the country (…) The main actions adopted by the authorities include simplification of bureaucratic procedures, elaboration of guides for investors, promotion of commercial intelligence activities and signing of international agreements for promoting and protecting investment.”
With regard to Brazil, the term includes a list of suggestions made by scholars and businessmen, such as “strengthening of private sector support to research and development, opening of offices and subsidiaries of the Brazilian Development Bank (BNDES) in key markets to promote business opportunities and improve financial support, and increasing the agility of the Brazilian government in actions for guaranteeing the contracts of Brazilian companies abroad when there are changes in legislation in other countries.”
As a conclusion, the document states that it is possible for the Brazilian government to operate with less government interference than the government of China, for instance. “The challenge lies in creating competitive conditions for Brazilian companies to fly farther and longer in the international market, while preventing government action from interfering negatively with the entrepreneurship that Brazilian businessmen have already shown.”
The elaboration of the term took five months and was coordinated by the Foreign Trade Board (Camex), with the participation of representatives of the Brazilian Ministry of Development, Industry and Foreign Trade, the Ministry of Foreign Relations, the Ministry of Finance, the president’s cabinet, the BNDES, the Brazilian Export and Investment Promotion Agency (Apex), the Brazilian Industry Development Agency, and the Institute of Applied Economic Research (Ipea).
The seminar at Fiesp was attended by the ministry of Development, Industry and Foreign Trade, Miguel Jorge, the secretary of Foreign Trade, Welber Barral, the president of Apex, Alessando Teixeira, and other representatives of the government and economic institutions.
*Translated by Gabriel Pomerancblum
