OVERVIEW
• History
• Geography and Climate
• Culture and People
BRAZIL FOR INVESTORS 2009
• Why choose Brazil?
• Facts
• Consumer Market
• Return on Investment
• Growth
• Presence on International Market
• Latest Developments
TO BUY IN BRAZIL
• Ownership in Brazil
• It is safe to buy real state in Brazil
• How much will it cost to buy or sell property?
• Legal matters
• Is it possible to get a mortage
• The land registration system
• Code of ethics
• Licensing requiriments
Overview
The biggest and most influential country in South America is Brazil, which is occupying almost half of the continent. The country grew to one of the world's economic giants and is known for its football powers, coffee production and distinctive music such as samba and bosanova.
The most populated area is close to the coast where two-thirds of Brazil's population live and for this reason great integration between locals and tourists ist taking place here, more than anywhere else in Brazil. Brazil is the homecountry to a multitude of ethnic groups and also of economic status which varies between different areas; but there are some characteristics that everyone shares - energy and passion. Not all reserved for football alone; Brazilians enjoy a good party whatever the circumstances!
Even though that festivals are taking place throughout the year in Brazil, the country's most famous event (and internationally known) is the carneval, which lasts for five days from Friday to Ash Wednesday. It is celebrated all over Brazil and in other brasilian states like São Paulo or Bahia it is almost authentic to the glamour and glitter carneval in Rio. In its sambódromo built for samba parades you can feel and fall into the excitement of the population and join the fever and frenzy when the members of the 16 top samba schools, dancing with fun and enthusiasm as each have their hour of glory. Dancing to the Samba, the beats of the Sambarythm and the summer temperature rises.
All kind of People different ages, cultures and ethnics using the very minimum in beachwear and idle away the days on the tropical sunny beaches. Beachvolleyball or swimming are a few of the activities in which you can indulge. Brazil's landscape varies just as the ocuppants of it.
Only a few tourists really dare the adventure far from Brazil's spectacular beaches. However a trip inland reveals a totally different face of the country altogether. Almost entirely covered with dense rain forest, Brazil's northern interior is split into the vast regions of Amazonas, Pará, Acre and Rondônia. These immense federal states easily outstrip the land resources of many European countries and cover over 3,400,000 sq km (1,300,000 sq miles) of endless jungle, home to lush vegetation and countless species of life. Brazil's vast assortment of people and places offers marvellous sights for everyone and any interest.
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History
The navigator Pedro Alvares Cabral from Portugal discovered Brazil in 1500. The first place he set his foot on, was Bahia. The beach which is today called Cabrá nearby Porto Seguro. Since then the export of goods had begun and dominated Brazil's economic and also cultural development.
Brazils wood was one of the first natural goods to be exported, used to make dyes and paints. In the 17th century, Brazil became the world's largest producer of sugar. Therefore plenty of African slaves were brought into Brazil to work in the sugar cane plantations. Sugar was replaced by gold and diamonds sugar as the country's major export product. By the second half of the 19th century, Brazil became the greatest and strongest coffee exporteur. Today coffee is still one of the major sources of income. In the late 19th-century rubber became the absolute boom, brought prosperity and developed the north of Brazil - the Amozonasregion - and Manaus became one of the big and busy cities with entertainment of international flair, but ignored by the foreign economy.
When Napoleon invaded Portugal in the early 1800's, Dom João VI, King of Portugal, fled to Brazil where the Portuguese colonial rule continued to run the empire. Ports were opened to international (mostly British) commerce, and the colony grew substantially. In 1789 happened one of Brazil's first uprise for independence from Portugal, but it was crushed. Its hero, Tiradentes, became a national symbol of freedom. Independence was finally proclaimed by Dom Pedro I (Dom João's son) in 1822. He became Brazil's first Emperor. His son, Dom Pedro II, reigned for 49 years until 1899 when the country became a Republic. In the year 1888, slavery was finally abolished by Princess Isabell.
1940 began a new phase of industrial development in Brazil. At the same time agriculture and tecnology advances gave further acceleration to the industrial and financial expansion. The internal market in Brasil grew without limit and also in export of agricultural products as well as manufactured items such as heavy machinery, shoes and steel products Brazil was one of the stronges countries.
Between 1956 and 1960 Brazil experienced five years of high economic growth under President Juscelino Kubitschek. In 1960, he made the futuristic city of Brasilia the new capital city of Brazil.
But also Brazil, like many other countries Latin Americas (Argentina, Chile etc.) fell under military rulership from 1964 to 1985. This was the time of the "cold war" between the United States and the Soviet Union. In 1988 were again the first popular elections for President after the Military-Dictatorship. In the late 1985 the country gradually returned to democratic rule. In 1989, direct elections were held for state governorships for the first time since 1965, and in 1990 direct presidential elections took place.
Today, Brazil is a democratic country. The current President, Luís Inácio Lula da Silva, took office in January, 2003. The economy of Brazil has steadily gone upward since he took over from Fernando Henrique Cardoso.
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Geography and Climate
Brazil is the world's fifth-largest country, occupying almost half the South American continent and bordering almost every surrounding country. Much of Brazil is rarely populated, although some regions with previously low population densities, such as the Amazon area.
Brazil is divided into four major geographic regions. The long, narrow Atlantic seastripes has coastal ranges between Rio Grande do Sul and Bahia, but north of Bahia the land is flatter. The large highlands called the Planalto or central plateau, is extended over most of brasils inland.
Most of the country has noticeable seasonal variations in rain, temperature and humidity, but only the south of Brazil has large seasonal changes. The Brazilian winterseason is between June and August. The coldest southern states receiving average winter temperatures between 13°C and 18°C (55°F and 64°F). In summer (December to February), Rio is hot and humid, with temperatures in the high 30°C (80°F). Average temperatures usually are around 25°C (77°F) the rest of the year. The northeast coast becomes hot in the summer but tropical breezes make it less humid. In general, the Planalto Brasiliero is cooler, here happen more summer rainfalls as in the north. The Amazon basin is the wettest part of Brazil, and because of the humidity, temperatures average a reasonable 27°C (80°F).
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Culture and People
Brazil's population is a mixture of Indians (the native American), Europeans, and Africans, which makes it a multicultural and mixed ethnic society. The Portuguese had arrived in 1500, but other Europeans came much later, after 1850. The ancestors of African Brazilians came to Brazil as slaves in the early of mid-1500s. This explains Brazils unique ethnic background. Only the native American population, the Indians, who had been in Brazil first and for a long time, present today the minority group.
By this ethic mix of cultures and of the three races – American Indians, Europeans and African Brazilians gives the country his unique cultural heritage. But the Portuguese culture is still influencing Brazil. The traditions of art and folklore is a result of the mixture of the art of Native Americans, Africans, and Portuguese. Brazil is also birthplace of many poets and is affiliated towards poetry. The painting and pottery also form a part of Brazil's artistic culture. Music was always a part of each and every Brazilian life. The most popular of all being Samba, a mix of blending of rhythm and vocal styles of Native Americans, Portuguese, and Africans.
Brazilians are famous for their love of football, motor races and most of all, Carnival!
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Brazil for Investors 2009
Why choose Brazil?
In comparisment to lots of other destinations, Brazil is still relatively underexplored in terms of its real estate potential - which can bring excellent opportunities for higher returns on property investments when buying properties in Brazil.
But recently the country has experienced a great rise in its popularity abroad, which was also caused by its strong economic performance and a growing active role in the international arena. Brazils image is sometines associated with an easy and healthy lifestyle, friendly people, and this wonderful combination of rain-forest, mountains and sea. The consequence is, that tourism inflows have increased dramatically over the past years and international property investors have realized the huge bargains that can be made in this fast growing emerging market.
Many of the big tourism operators and also hotel chains have started to invest in large scale projects in Brazil, especially in the warm, sunny northeast coast. Practically all major names in the hospitality business such as Marriott, Club Med, Sheraton and many others have invested millions of dollars in exclusive developments around the country, boosting the economies of local communities and increasing values of surrounding properties.
With almost five thousand miles of coastline, Brazil is a prime location for oceanfront properties, and perhaps one of the safest countries - from geographical, climatic and political viewpoint - for a property investor looking at long-term appreciation.
Brazil is under a stable and democratic government, it is self-sufficient what oil concerns and leader in developments of recicle energy sources, such as ethanol and bio-diesel.
Why you should consider Brazil as your next investment is written below:
* Foreigners can own hundred percent of land and property.
* Low real estate prices
* Wide coast line offers incredible beach-front options
* Holds 1/3 of fresh water reserves of the intire world
* Wonderful weather, and sunshine all through the year
* Very high property appreciation potential
* One of the leading emerging market countries
* Actually no risk of international terrorism and war
* Rich cultural variation
* Incredible beauty of nature
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Facts
* Land surface: 8,514,215 km² (the world's 5th-largest)
* Population: 188 million (the world's 5th-largest)
* Gross Domestic Product (GDP): US$ 1140 billion (2008, US$ 1.00 = R$ 1,8660)
* Per capita income: US$ 7.831 (2008)
* 50% of surface area of South America
* 50% of population of South America
* 50% of South American GDP (Mercosul - 65%)
Brazil, the United States, and China are the only three countries possessing certain key factors for sustained growth:
* Surface area of over 5 million sqkm
* GDP over US$ 600 billion
* Population over 188 million
* 188 million consumers
* 92,5 million economically active population
* Low costs of living
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Consumer Market
Brazil is the world’s 7th-largest consumer market:
* Brazil stands as the gateway to Mercosur: it has borders to 9 countries: Argentina, Bolivia, Colombia, French Guiana, Guyana, Peru, Suriname, Uruguay, and Venezuela.
* It is the world's largest producer of regional jets, it ranks third in shoes and soft drinks, fourth in commercial aircraft, eigth in steel, 10th in carproduction.
* It is the home of Latin America's largest forestry-based industry.
* It obtains the 5th-biggest rubber industry, and the seventh-largest paper and pulp industry.
* It is the world's 6th-largest market in cosmetics, with annual sales of US$ 9 billion.
* It has a modern and competitive textile complex, with 30.000 companies and yearly sales of US$ 21 billion.
* It contains 22% of the world's land surface. It has the most advanced banking system and one of the most high-tech telecommunications systems in the world.
* In Brazil, 99% of tax returns are done by the internet.
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Return on Investment
Investing in Brazil is clearly profitable. Over the last few years the rate of return on direct foreign investment (FDI) in Brazil has been 26,4%. There are no restrictions on remittance of profits.
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Growth
Sustained Growth Brazil's GDP (US$ 1.2 trillion in 2008 and still growing 5.1% ) is the 10th-largest worldwide. Brazil is the biggest exporter of coffee, orange juice, sugar, sojabean, beef, poultry, tobacco, and iron. Other key factors of sustainable growth are:
* Consequent fiscal policy
* Inflation is under control
* Deminishing government debt
* GDP ratio, Growing industrial results.
Dominating with large and well-developed agriculture, mining, manufacturing and service sectors, Brazil's economy outweighs all other South American countries and is expanding its presence in world markets.
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Presence on International Market
The very well performing of the economy had a direct influence on trade flows (exports plus imports), which in March 2009 totaled to U.S. $ 4,245 bil (export) and U.S. $ 2,908 (imports). For the end of this year, a large increase of GDP by the Trade flows are expected.
Brazil has established itself as a strong country in the world with a growing number of Brazilian companies established and operating abroad with approval. The investment in South America, the United States and Europe rose to U.S. $ 9.5 billion in just one year. Some of Brazilian companies with international presence are Vale, Empresa Brasileira de Aeronautica, Gerdau, Ambev, Embraco, WEG, CVRD, Petrobras, Marco Polo, and Tigre.
* Between 1994 and 2004 was the highest leap in investment outside of Brazil in the international market: from U.S. $ 700 million to U.S. $ 9.5 billion - (an increase of 1357%).
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Latest Developments
From 2001 to the year 2003 real wages fell and Brazil's economy grew only 2,2 % in average per year. The country absorbed series of domestic and international economic shocks. That Brazil withstood these shocks without financial collapse is a tribute to the resiliency of the Brazilian economy and the economic program put in place by former President Henrique Fernando Cardoso and strengthened by President LULA DA SILVA.
2004, Brazil gained more robust growth that yielded increases in employment and real wages. The 3 pillars of the economic program are a floating exchange rate, an inflation-targeting regime, and a tight fiscal policy, all reinforced by a series of IMF programs.
Currency depreciated badly in 2001 and also in 2002, which contributed to a dramatic current account adjustment. But 2003 to 2005, Brazil ran record trade surpluses and recorded its first current account surpluses since the year 1992.
Productivity gains – particularly for Brazil in agriculture - also contributed to the surge in exports and the country surpassed in 2005 the previous year's record export level.
While the economic management was good, remained still important economic vulnerabilities. The most significant were debt-related: the government's large domestic debt increased steadily from 1994 to 2003 - straining the finances of the government - before falling as a percentage of GDP in 2005, while Brazil's foreign debt (which was a mix of private and public debt) is large in relation to Brazil's small (but growing) export base.
Another challenge is maintaining economic growth over a period of time to generate employment and make the government debt burden more manageable. In October 2006, President Lula (PT) for a second term (2007-2010)was reelected. In the runoff election, he suggested, with 61% of the vote against the candidate Geraldo Alckmin (PSDB, 39%).
In his second term the government plans to Vortsetzung and expansion of social programs of his first term, including the fight against hunger and poverty through the Fome Zero and Bolsa Familia (family grant) and by boosting the economy and creating new jobs. The statutory welfare was actually introduced and reached the end of the first reign of 10 million families, about 25% of the population. In addition, more measures to create employment and incomes, promoting family farms, providing new impetus to the agrarian reform, support schemes in drought, and literacy campaigns are launched. Brazil as the largest country in Latin America (area, population, economy) and an important emerging nation occurs with the self-confidence of a leading regional and global actor, representing the interests of developing countries to industrialized countries and as a promoter of South-South cooperation. Brazil is actively exporting its interests, particularly in its powerful farming. It happens for a freer agricultural trade, with particular regard to the interests of developing countries.
President Lula da Silva unfolded brisk foreign policy activity. He is internationally renowned for biofuels, during their production and use of Brazil is the world leader. Brazil has participated in several G8 meetings as dialogue partners (eg, President Lula at the G 8 summit in Heiligendamm in June 2007).
The main objectives and priorities of Brazilian foreign policy are:
• Strengthening of relations with neighboring South American countries and other Latin American partners, regional integration
• establish an equitable multilateral world order and reform of the United Nations: Brazil is seeking a permanent seat on the Security Council to pursue this interest, together with Germany, India and Japan within the framework of G 4
• boost ties with Entwicklungs-/Schwellenländern and strengthening the voice of developing and emerging economies in world politics
• Strengthening the role of Portuguese Speaking Countries
Brazil acts as a stabilizing factor in Latin America and recognizes the relationship especially on the South American neighbors and regional integration a priority. The principal regional organizations are responsible for the Brazil Mercosul (Spanish: Mercosur) and the 2008 South American states created joint (UNASUL /-R). 2008 Brazil was host of the first Latin American-Caribbean Summit. The regional integration efforts in Brazil are not only the basis for closer economic cooperation in South America, but also for their development of economic resources and infrastructure links of the subcontinent ( "physical integration") and for the fight against political instability, poverty, drug trafficking and terrorism . In addition, it displays the position of the second-largest troop contingent and its leadership role in the UN Stabilization Force in Haiti (MINUSTAH) international engagement.
The relationship with Europe and particularly the EU, the main trading and investment partner, Brazil has gained importance. Under the German EU presidency in the 1st Half of 2007 was the political dialogue EU-Brazil recorded. The EU-Brazil summit in Lisbon in July 2007 decided to form a strategic partnership, which in December 2008 by a concrete action plan was. EU and MERCOSUL aspire to an association agreement. The political exchanges between visitors EU-Mitgliedsstaaten/EU-Kommission and representatives of Brazil is intense. Brazil is working in many areas to work closely with the United States, the U.S. is the largest bilateral economic partner. For the USA, Brazil is a strategic partner in South America. Yet Brazil is the United States independently and with partly divergent views on many global issues compared.
Brazil is working within the framework of international organizations are actively involved with and is an important partner of Germany and the European Union. Its objectives include the strengthening of the United Nations to the maintenance of world peace and promoting global sustainable development. At the same time it sets up for a reform of the United Nations - including an expansion of the Security Council - a. With Germany, India and Japan, also a permanent seat in an enlarged Security Council, it works for mutual support in the group G 4 closely together. The country is well under President Lula again stronger in the global environment and climate debate. Lula proposed for 2012, an international "Rio +20 - Conference" in Brazil, called for a socially equitable development to prevent the destruction of the planet, the full realization of the Kyoto commitments by industrialized countries and help developing countries (such as national climate change plans) . In addition, he said Brazil's sovereignty and responsibility for the Amazon forest. The end of 2008, Brazil announced the first time a national climate plan with time-bound targets, including the reduction of emissions from deforestation and Amazon set up a fund.
Brazil supported the efforts to non-proliferation of sensitive technologies. It is a party to the Convention on biological and chemical weapons as well as in the nuclear field of the Tlatelolco Agreement (Nuclear Free Zone Latin America / Caribbean), the four-control pact, the nuclear Non-Proliferation Treaty (NPT) and the Treaty on a comprehensive test ban, although it has the additional protocol to the NPT so far not signed.
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To buy in Brazil
Ownership in Brazil
There are no major restrictions for foreign buyers or sellers concerning residential or commercial property. Only some limits or fees are applicable for specific areas such as marine land, islands, agricultural rural land or areas near Brazil’s international borders.
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It is safe to buy real estate in Brazil!
Brazil is a safe place to buy real estate. Recommended - as with any overseas purchase -to use an approved estate agent and lawyer. Many Americans and Europeans already bought properties in Brazil.
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How much will it cost to buy or sell property?
The average transaction costs (i.e. stamp duty, fees etc) will be around 7% of the purchase price. There might be differences depending on the location (egg beach-front), type of property and also the state were you buy . If a significant amount of administration comes up to establish title and ownership, this will rise the costs. The budget will cover for Government Purchase tax (2%-7%), legal and registration fees.
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Legal Matters
We sure will introduce you to English speaking lawyers who will help you with your purchase.
The lawyers check if the current owners have a correct title to the property, veryfy if there are any charges or liabilities on the property. They will finalize the contract and advise on obligations for both parties. Also they will help through the payment/funds transfer. Ensuring that the property is registered in your name.
There are generally no limits to returning money back overseas if registered with the Central Bank at the time of your purchase.
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Is it possible to get a mortgage?
The mortgage market is in its infancy in Brazil. Mortgage is not very developed in Brazil, since foreigners are not able to obtain it. Buyers usually have other alternatives, such as funding in their own countries. However, we expect that mortgages are available in the near future, provided that interest rates fall and the banks continue to develop its portfolio of services.
Some builders of new buildings and businesses in the plant plans to offer service that vary between 12 and 84 months. The applicable cost varies according to the developer, and the returns are generally related to its indexes. The charges applicable vary from developer to developer and payments are usually indexed.
If you have property in your own country and would like to borrow against this, then we can introduce you to an Independent Financial Advisor who can help you raise finance accordingly.
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The Land Registration
System
Real estate registration in Brazil is carried out by private notary publics, under the form of a public permission, under Justice Control. All real estate registries in Brazil are under control and fiscalization of a State Judge.
The real estate registry system in Brazil is quite developed and safe, in which each property can only be registered at a single registry, which keeps the entire commercial history and the physical identification of each property. The access to all information of a real estate, including those concerning its owners, mortgages and other burdens, is public. In the larger cities, these services this may be automated. It is very important to ensure that any property you buy has clear title.
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Code of Ethics
The Real Estate Agents Law imposes a Code of Ethics for all professionals and companies operating in the sector. There are internal disciplinary processes with sanctions ranging from fines to violator’s license suspension and cancellation. Sanctions are imposed by COFECI, through the CRECIs.
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Licensing Requirements
All of the real estate agencies must have a fully qualified real estate agent partner who is technically responsible. For closing a sale, it is necessary that a public deed will be drafted by public notary, and will be registered in the real estate registration. A sale can be entered into directly between seller and purchaser, but intermediation on such activity can only be carried out by a real estate agent or agencies accredited by the CRECIs. A lawyer is not mandatory, but he can represent any of the parties as attorneys-in-fact.
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