Giuliana Napolitano
São Paulo – Brazil receives little investment from Arab countries, but the volume may rise "if an operation for resource attraction is put in practice". This is the evaluation of Fernando Ribeiro, chief economist in the Brazilian Society of Transnational Corporations and Economic Globalization (Sobeet).
Recent data supplied by the Central Bank shows that, in 2000, there was little more than US$ 13 million in Arab investment in Brazil. This represents 0,01% of total foreign investment in the country over that period (around US$ 103 billion).
According to the Brazilian Central Bank (BC), this capital has come from only three countries in the Middle East: Qatar, Jordan, and Lebanon. Lebanon alone answered to 76% of the total investment, almost US$ 10 million invested in the country. Qatar invested around US$ 1.7 million and Jordan US$ 1.4 million.
To Ribeiro, the reason for Lebanon to be the largest investor in Brazil is immigration. The Lebanese – together with the Syrians – were the first Arab immigrants to arrive in the country in around 1880. Today, Brazil has the largest Lebanese colony in the world, at over 6 million people. The contingent is, incidentally, larger than the total population of Lebanon, 3.6 million inhabitants.
Oil producers
"The investment level is low, but there is opportunity for growth", states Fernando Ribeiro. He has identified, for example, that the largest oil producers – located mainly in the Arabian Gulf region – are not included in the list of investors.
These countries include Saudi Arabia and the United Arab Emirates, for example. Apart from having two of the largest oil reserves in the world – Saudi Arabia is the leader, with 261 billion barrels, and the Emirates come in third, with 98 billion barrels, guaranteeing both countries repeated trade balance surpluses -, both countries have recently been going through processes of opening their economies.
Apart from that, after the September 11 terrorist attacks, it is estimated that between US$ 300 and US$ 400 billion in Arab capital have left the North American market. And the investors are looking for new destinations for this investment.
"Steps may be taken to attract this investment", says the Sobeet economist. To him, the tour president Luiz Inácio Lula da Silva is going to make of the Arab countries in December "should help".
Saudi Arabia has already invested in the country. In 1995, according to the Central Bank, the stock of Saudi funds in the country was US$ 873,000. That year the Arab investment volume in the country was larger: US$ 28.5 million. Lebanon was still the highest ranking Arab investor, at US$ 27.6 million, followed by Qatar, with US$ 1 million, and then by Saudi Arabia.
Trade is the starting point
Another "rout" to increase Arab investment, pointed out by Riberiro, is trade partnerships. "Trade partnerships are also the first step for partnerships in the investment area", he states. "And trade between Brazil and the Arab countries has been rising", he points out.
Last year, Brazil sold to the Middle East and North Africa the equivalent to US$ 2.6 billion and bought US$ 2.3 billion, a volume that totaled less than 5% of total Brazilian transactions abroad.
In export, though, there was a 73% expansion over the 2000 result. The result is that last year Brazil had one of the first trade surpluses with the Arab countries, totaling US$ 300 million.
Perspectives are also positive. A study by the Arab Brazilian Chamber of Commerce (CCAB) shows that Brazilian sales to the region may rise 170% and arrive at US$ 7 billion before 2006.
