São Paulo – Market Securities, a global broker headquartered in London, England, with a branch in Dubai, United Arab Emirates, has ambitious plans for Brazil-UAE investments. With Brazilian executive Celso Filho leading the Special Projects division, the brokerage plans to structure a fund for Emiratis to invest in Brazil’s agribusiness sector and another for Brazilians to invest in the UAE’s real estate sector.
Although the hiring had not been motivated by nationality, Celso’s arrival at the brokerage was the final push Market Securities needed to turn its attention toward Brazil, where its main competitors are already well established. According to Celso, before his arrival six months ago, there were no actions focused on Brazil at the brokerage, but there was an understanding of the country’s importance.
“There had always been an interest in the country—you can’t really ignore Brazil, as its economy is almost the size of the entire Gulf economy,” he says. “Now we will start to put one foot into Brazil,” says Celso, clarifying that this isn’t about establishing an office but rather developing financial products.
To this end, the company has recently become a member of the Arab-Brazilian Chamber of Commerce (ABCC) and has begun developing a strategy focused on the Brazilian market. Market Securities is a wholesale brokerage, meaning it doesn’t operate directly in retail financial services for individuals but caters to institutional clients, such as brokerage firms and banks. In this realm, the company is designing funds connecting the UAE and Brazil that will be offered to the market by other financial institutions.
The product that is furthest along in its development is a fund for Arabs to invest in Brazilian agribusiness. The fund structured by Market Securities will be administered in the UAE, with its assets allocated in agricultural projects in Brazil focused on exporting to the Arab country. The brokerage will work with partners – in Brazil with consultants or specialized agribusiness companies to help assemble the asset portfolio, and in the UAE with a financial distributor for the fund.
Celso says that discussions with potential partners for this fund are already quite advanced. Although everything is moving toward the fund being established in the UAE, the executive doesn’t rule out the possibility of it occurring in another Gulf country and anticipates that the financial product will also attract investors from the region. “Virtually all banks and family offices from other Gulf countries are present in Dubai,” he says. Family offices are entities that manage large family estates.
Regarding the choice of agribusiness projects to establish a fund for Arab investors, Celso says: “Where we see the most opportunity is in the agri sector due to geoclimatic and geopolitical reasons.” He notes that Brazil is a powerhouse in agribusiness and that due to natural climatic conditions, commodity production can’t occur in the Gulf. At the same time, the region has good relations with Brazil. Celso sees that investors from the UAE are less interested in investing in Brazil as a “financial thesis” and more as a “commercial thesis,” focusing on preferential access to its products.
Real estate investment fund
On the other hand, Market Securities aims to set up a fund for Brazilians to invest in the real estate sector of the UAE. “When you look at the sectors that receive the most foreign investment here, real estate is the leading one. That’s why I see it as a good niche to present to Brazilians,” says Celso, referring to Dubai.
In this case, the fund will also be structured by Market Securities but will have its assets in the UAE and will be administered in Brazil to be offered to Brazilians. The brokerage will also work with partners – in Brazil with a bank or financial manager, and in the UAE with one of the main local companies specializing in real estate, which will also manage the assets.
The properties are planned to be both residential and logistical. “I already study this market quite a bit, and the residential sector is the flagship,” says Celso. According to him, as it’s very tourist-oriented, the UAE has many second homes of foreigners who don’t always live in the country. “It’s a good sector, very resilient, and excellent for generating income,” he says. The logistical sector is expected to include assets such as warehouses, distribution centers, and port infrastructure. Celso sees investors as private banking clients and family offices from Brazil.
Market Secutiries
Market Securities has been in operation for 16 years. Although it started operations in London, the financial institution has had a branch office in Dubai for 10 years, located in the Dubai International Financial Centre (DIFC), and is regulated by the Dubai Financial Services Authority (DFSA). The company has 300 employees distributed across New York, London, Geneva, Paris, Hong Kong, and Dubai, and has Arab capital participation.
The financial institution processes USD 1.1 trillion annually, and among its clients are the largest European and US banks, the largest and most sophisticated hedge funds, and major asset owners in Europe and the Middle East. As a wholesale broker, among its primary operations is the execution of large orders in the stock market.
The Special Projects division, led by Celso Filho, is tasked with developing additional opportunities for the brokerage in the financial market. A native of Minas Gerais state, Celso moved to the UAE at the end of last year and, upon arriving in the Arab country, was invited to work at Market Securities. Among his responsibilities are, for example, the opening of new brokerage offices in the Gulf region.
Celso Filho
Graduated in Law from the University of São Paulo (USP), with a master’s degree in both Law and Finance from French business school INSEAD, Celso worked in financial institutions in Brazil such as Itaú BBA, B3 stock exchange, Citigroup, and Credit Suisse before moving to the UAE.
The challenge that the Arab country faces—reinventing its economy in light of the new reality of the oil sector—is stimulating for the executive. “Twenty years from now, the economy will be completely different, and they know it, so they are under a very unique pressure for growth,” he says.
The security in the UAE also influenced Celso’s choice for the country as his place of residence, in addition to the opportunities available for foreigners and the absence of personal income taxes. He observes that this significant foreign presence—88% of the population is non-native—creates a great deal of tolerance in the country.
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Translated by Guilherme Miranda
