Brazil GDP grows

Tags: economy

Written on Saturday June 5th:
The Financial Times’ article of last week made it clear to which extent BP and the rest of the US offshore drillers will be under the thumb of the Obama administration.
My personal view is that this impact is today calculated into the shares of BP (trading at 37,16) and Transocean (trading at 50,20).  An opportunity in the coming weeks for people with a stomach?

On the more safe side: with this BP event, there will be ever increasing importance placed on reserves which will not be affected by the Obama administration. While pressures from pending U.S. legislation on oil drilling may pressure international governments to apply similar restrictions on offshore drilling, Brazil will not be one of them.  Petrobras will enjoy vigorous drilling offshore on their newly discovered Tupi field. This massive find contains by conservative estimates around 6 – 8 billion barrels of oil and gas.
Actually, last Friday Bloomberg reported Petrobras did yet another oil find at the Marlim fields, adding another 380 million barrels to their reserves.
Petrobras is trading at 36,06, 50% down from its May 2009 72,38 top.
Petrobras will be good for Brazil, no doubt.  And the BP events will add to this.  But will Petrobras be good to its shareholders?  Brazil has made it evidently clear that they intend to use Brazil’s new Tupi oil field as a springboard for their domestic economy. The Tupi oil field will become the platform which Brazil will use to invest in Education, Social Services, Infrastructure, etc.

The bets are out, end July / early August, Petrobras will organize a share offering of between US$ 50 and 60 billion, amongst the world’s largest ever launched.

And there is also…
Total
Repsol
Suncor

To put on your radar.

In my opinion, oil futures will be back at USD 85 – 90 next winter; US slows down drastically all of a sudden.

And did we hear Obama shout “Natural Gas” and “Nuclear Energy” in the same sentence?
UNG +
GAS
CYMGF +
FCG

Let’s put the flag out on a 100 portfolio:
BP: 5 at 37,16
RIG: 8 at 50,20
PBR: 12 at 36,06
TOT: 17 at 45,25
REP: 11 at 19,05
SU: 6 at 32,56
UNG: 15 at 8,18
GAS: 3 at 39,57
CYMGF: 17 at 3,92
FCG: 6 at 16,63

In August 2011 we dig this up again.

Tags: oil brazil, petrobras

BBC video: here.
The Economist video: here.
Financial Times video: here.

Last week the BBC aired a balanced video on the state of the Brazilian economy; they visited the Caixa economica real estate fair on May 27th.   They journalists makes a point on the still massive need of new low class housing to replace the favellas and the need for reforms in labour and tax laws to boost productivity.

Last weekend, The Economist also aired a video with an interview with the Brazilian Central Bank president Henrique Meirelles.  Appointing Meirelles was agood choice of Lula and the man again reassures with his monetary policy.
The latest May figures confirm inflation in Brazil steadying at 5,67% (benchmark: Belgian consumption price index rose to 2,3%, South African consumption price index was at 4,8%, but the producer price inflation in South Africa rose 5,5% y/y (+1,5% m/m) in April after rising 3,7% in March.  Meireless reconfirmed that 2010 inflation target will be met.

Also interesting this interview with Eika Batista by Jonathan Wheatley of the FInancial Times on the upcoming general election in Brazil and the relationship of Eike Batista’s company with China.

Tags: brazil video

Last December Azul started its operations in Florianopolis, with 3 flights daily to Sao Paulo (and quick connection to Rio).
Last AprilAzul also connected Navegantes with 3 daily flights.

And now there are talks to connect also Joinville with Azul flights.  Today residents from Joinville have to go to Curitiba to take a plane to the Sao Paulo hub.
Azul is just waiting for the installation of the ILS (Instrument Landing System) in the Joinville airport.

Tags: azul joinville

Brazil counted 4,8 million tourists in 2009, 4,9% less than in record-year 2008 when 7,2 million tourists visited the country.
In 2010 the number of tourists is expected to be around 7,8 million tourists and by 2014 BMI forecasts that number to grow to 9,2 million.

Last April,, foreign tourists spent US$ 461 million in the country, the largest value ever recorded in the month since 1947. The total for the first four months of the year is US$ 2.116 billion.

In December, the Brazilian government announced its Plano Aquarela 2020 that aims to double the number of foreign visitors in the next ten years. The 2014 World Cup and the 2016 Olympic Games, that will be hosted by the country, should be instrumental to reach this target.  You can find the full presentation here.

Interesting is to see the table of the countries form which tourists growth was fastest in the period 2003-2005 (page 23 and 24).
Belgium ranks lowest, with number of tourists to Brazil growing from 29.237 to 30.037.  Holland only has 1,6x the number of habitants of Belgium, but they have 2,8x the number of people visiting Brazil and also growing at double the growth rate of Belgium (31% to 16%).  Belgium is clearly “onder de kerktoren”.

Also interesting:
60% of all international tourists visit Rio de Janeiro (up from 52%), Florianopolis ranks with 7% (up from 4%), in the same league as Natal (8%), Fortaleza (8%) and Recife (7%), which grow on a much slower pace (1%).  Visits to Salvador plumetted from 21% to 14 % and also visits to Foz do Iguacu go down from 12 to 11%.

And 60% of the incoming international tourists come for the second or more time to Brazil (read: repeat business is high).

31,5% of all tourists visit Rio (going slightly down from 33,9%) and 12,1% visit Florianopolis (going up from 11,9%).  More tourists visit Florianopolis than Salvador (11,5%), Fortaleza (6,4%) or Natal (5,8%).

Tags: tourism brazil