Brazil: Infrastructure projects, lran and agribusiness
Despite the news one can read in the media about the economic and political crisis in Brazil, the government is still able to push through infrastructure projects with the aim of having private participation in such projects.
Just like any other developing country, Brazil still faces many problems related to infrastructure. The government has made important moves by privatizing several airports in the capital cities of some Brazilian states.
Foreign investors should pay more attention to some specific sectors. The first one is related to energy - the distribution of energy, transmission lines and hydroelectric dams. The National Bank for Economic and Social and Development would be structuring auctions related to state companies carrying out activities in the sanitation/ wastewater system, which is a very specific economic sector. Airports, roads or highways and ports should also be sectors which foreigners should pay attention to for possible investment in Brazil. Such investors could think of Islamic finance structures abroad like Musharakah or Murabahah that could work under Brazilian law.
A very special sector is the one related to the oil and gas industry. Auctions related to onshore areas (small ones) and offshore (pre-salt) have already been scheduled and there are several players in the MENA region with expertise to invest in this economic segment.
Still regarding the oiI and gas industry, Brazil's National Agency of Petroleum, Natural Gas and Biofuels has been contacted by companies from China, India and Iran to invest in oil refining either in partnership with the Brazilian oil and gas company Petrobras or in new projects.
As for Iran, the country is trying to enhance its commercial relationships with Brazil and the Iranian ambassador had a meeting with the minister of the Ministry of Industry, Foreign Trade and Services.
There is an interesting development in the agribusiness segment. Aqua Capital, a manager of funds with equity participation and with its head office in Sao Paulo, has concluded a second investment fund focused on agribusiness. Several investors have participated in the Aqua Capital Agribusiness Fund II with 10% of the fund capital coming from the Middle East.