For many years Brazil was a developing country, however as the international macroeconomic indicators clearly show, this amazing nation’s economy is today a rapidly expanding economic power. There are many objective factors that highlight Brazil as the most viable option for any type of business or investment. The secret, as is the case with all markets, is the volume, sustainability and intensity of the current demand.

According to the International Monetary Fund and World Bank, Brazil in 2009 ranks 10th in terms of Gross Domestic Product (GDP) among the 180 countries surveyed, ahead of Russia and India. The nominal GDP per capita has risen from US$6.937 in 2007 to US$8.449 in 2008, with growth forecasts for 2009, despite the international crisis which in the real estate sector, and in many other sectors, is unheard of in this country.

Public infrastructure, especially roads and airports, educational progress, environmental policy and, ultimately, the modernisation of society by way of structural reforms, of a both legal and economic character, not from risky revolutionary or populist avatars, has led this country into the future which had been for so many years just out of reach.

In transition
On more specific terms, Brazil has a population of 190 million people with a colossal lower class, which is rapidly transforming into a growing middle class. In fact, as has happened in all developed countries, the standardisation of a large middle class has always been the safest and best oiled machine through which to achieve fully developed socio-economic status.

Over the past five years the base salary of Brazilian workers has increased by 55 percent and credit plans, introduced and promoted by the government, have increased exponentially. This has led to something hitherto unknown, the readily accessible mortgage loan tailored to the needs of the population of the aforementioned social fringes. This is enabling the largest segment of Brazilian society access to home ownership. The needs are dizzying and the demand unstoppable: The supply must be consistent to cope with this undeniable social and economic reality.

The economic explosion, and real estate development has already begun, the future of Brazil has already taken off – the specialised sectors, and the savvy investor see this as an invitation to participate in the benefits which this development will produce… is already producing.

My house, my life
While it is true that all capitals and major cities in the country will benefit from this massive growth in the coming years, the North-eastern states are expected to be the main beneficiaries because it is where the country is less developed. The Brazilian Government’s urban development plan, accompanied by the slogan “My house, my life” aims to generate one million homes a year for people in low and middle income to answer, over a period of eight years, to a housing deficit of eight million homes.

Natal is the state capital of Rio Grande do Norte, in the northeast of Brazil, the city where the largest international cargo and passenger airport of Latin America is being built. It is more than predictable that Natal will become a hub for South and Central America, thus increasing the number of tourists from Europe and North America, who are already buying holiday and retirement homes. Natal, selected as one of the 2014 World Cup host cities, where one can allegedly breathe the purest air on earth after the Antarctica is known throughout Brazil as the “city of sun.”

It is not difficult for European investors to benefit from the growth which is taking place because of the factors listed above, but it is necessary to proceed with caution, taking heed of a basic principle: ensure that you carry out your own due diligence on the company with whom you are looking to invest, to ensure that they are not only solvent but that the investment is legally sound and that the company is respected within the sector in which you are looking to invest.

Brazil is light – Brazil is colour, football, partying, samba and carnival… Brazil is beauty, pleasant lifestyle and amazing beaches but that is not all that it is. As the indicators outlined above show us; it is also a world of possibilities, a world of economic development, urban growth, public infrastructure improvements, environmental sustainability, wealth distribution, social re-balancing and overcoming the ancient educational barriers between classes, of modernisation in every respect and economic stability.

The time is now, as the major global economies are shaken, to best take advantage of this exceptional growth and participate in the amazing journey this wonderful country is on to become one of the strongest economies in the world. The future has arrived in Brazil..

With thanks to:
Eugenio de Araujo Gadelha
Managing Partner
Gadelha Abogados

Angel Acedo Penco
LL.D. University Professor
President of the Consortium of Latin American Research and Development Center (IDRC)