Brazilian companies step up their investment overseas

A survey by think tank Dom Cabral Foundation shows that the majority of Brazilian companies operating abroad have increased their investments in foreign markets over the last two years. The study was supported by the Brazilian Trade and Investment Promotion Agency (ApexBrasil), linked to the Ministry of Development, Industry, Trade, and Services.

According to a survey released on Tuesday (Sep. 12), 45.1 percent of internationally active Brazilian companies increased their investments abroad, 38.2 percent kept them at the same level, and 16.8 percent reduced them.

Most of the companies interviewed (56.9%) said they had stepped up their investments in Brazil, 38.2 percent had kept them unchanged, and 12.1 percent had decreased them.

The survey heard from 237 Brazilian businesses operating overseas, mainly those that export or have subsidiaries abroad. Among the enterprises surveyed, most are in trade (16.5%), followed by machinery and equipment manufacturing (10.2%), and chemical products manufacturing (7.1%).

Regarding investment, 54.6 percent of the companies said their financial results abroad had improved over the last two years, 27 percent had remained stable, and 18.3 percent had shrunk.

The outcome is very similar to what corporations said about their numbers on the domestic market: 57.9 percent stated their performance had improved, 22.4 percent had remained stable, and 19.7 percent had declined.

Plans for the future

Among the companies interviewed, 64.4 percent said they plan to expand in the next two years in the markets in which they already operate. “The main reasons for this expansion are new possibilities abroad, growth in e-commerce, consolidation of alliances and partnerships, the offer of innovative products, investment in technical and operational qualifications, and greater brand recognition,” the text reads.

Only 10.5 percent of the enterprises said they planned to reduce operations in the foreign markets in which they already operate over the next two years. The reasons are generally attributed to factors such as the impacts of the COVID-19 pandemic, the war in Ukraine, increased freight, high interest rates, and inflation.