BRAZIL’S ECONOMIC STATISTICS

Population: 201,032,714.Size: 8,460,307 Sq. KmGDP (Nominal): USD 2.25 trillion Income per capita: USD 11,630(Source: World Bank, 2012 report)Inflation Rate (IPCA): February 2014: 0.63%.Accumulated 2013: 5.91 %

Foreign Direct Investments:December 2013: USD 6.6 Billion Accumulated 2013: USD 63.8 Billion

Exchange Rates: Dollar - 29/Jan/2014 Buy: BRL 2.4390 - Sell: BRL 2.4397Euro - 28/Jan/2014 Buy: BRL 3.3023 - Sell: BRL 3.3038(Source: Central Bank of Brazil)

IBovespa (IBOV) - São Paulo Stock Market Index: 51.507 Points Trading Volume (December 2013): BRL 118.6 billion.

INTRODUCTION

This is a quarterly publication by the Trade Promotion and Commercial section of the Embassy ofBrazil aimed at creating awareness on the existing trade opportunities between Brazil, Kenya and the EastAfrican Community countries. The newsletter will capture trending global business news that will help inform potential entrepreneurs on available business opportunities besides disseminating news on existing businessenvironment within Brazil. Brazil is the world’s seventh largest economy as well as a solid democracy and with a booming business environment. It is one of the rising economic powers together with Russia, India and Chinaotherwise known as BRICS nations - with its economic reforms giving the country new international recognition andinfluence. Over the past few years it has made major strides in its efforts to raise 40 millionpeople out of poverty that now can benefit from one of the world’s fastest growing major economies.

President Dilma Rousseff during the inauguration of Arena de Amazonia - stadium that will host matches during the WorldCup football tournament in Brazil in the summer.

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International Reserves:November 2013: USD 376.096 Billion

Brazilian Exporters is a federal government initiative to promote Brazilian companies on the internet and its products in the international markets. The creation of a new version of Brazilian exports is intended to provide not only a powerful communication tool, but also look for synergies between the various measures taken by government agencies in this area in order to strengthen and unite efforts to greater visibility to Brazilian exporters. Foreign importers interested in doing business can access the Virtual Showroom and send their proposals directly to the participating companies through the form available at the store.

HOW TO DO BUSINESS AND INVEST IN BRAZIL

BUSINESS NEWS ON BRAZILIAN ECONOMY

Brazil is a democratic country with a wide macroeconomic and institutional stability. With an area of 8.5 million square kilometers and a population of over 200 million inhabitants, Brazil has the world’s eighth largest consumer market, besides representing a gateway to MERCOSUR. The investment opportunities in Brazil are diverse and, aiming to facilitate business and investment accomplishment in the country, the Department of Trade and Invest-ment Promotion of the Ministry of External Relations has established a partnership with the American Chamber of Commerce (AMCHAM-BRASIL) to publicize the series How to do Business and Invest in Brazil at Brasil GlobalNet.

AMCHAM Brazil has been developing the How to do Business and Invest in Brazil project for over ten years. The main focus is to support potential foreign investors, professionals, and entrepreneurs who have recently arrived in Brazil, with the intention of promoting business in the Brazilian market. There are guidebooks in English and Mandarin with wide-ranging information on a variety of relevant themes on Brazil and the main Brazilian States. Each edition is the result of partnering by AMCHAM and a company or institution specialized in the subject matter.

Global start up trend for 2014: Consider Brazil (Source: www.nbcnews.com)

It’s time to look beyond the sunny beach-party exterior. More than just a tourism magnet that attracts 5 million-plus visitors every year, Brazil is South America’s largest economy, with gears turning busily in numerous sectors. Brazil’s population has increased from 96 million in 1970 to about 200 million today. As a result of government investment and solid economic growth, 40 million of those people entered the middle class over the past decade. And with two major global events on the horizon - the FIFA World Cup in 2014 and the Olympics in 2016 in Rio de Janeiro - Brazil is poised as a dynamic magnet for entrepreneurial investment.

Alex Nascimento, founder of 7Brazil Consulting in Santa Monica, Calif., has taken dozens ofindividual investors on exploratory trips to his native country. “We’re going to have significant investment from the government as well as new foreign direct investment. If new tax legislation gets passed, that will give a boost to Brazil’s stocks and publicly traded companies. In the coming years, I see Brazil becoming the best it can be.” Nascimento points to real estate and the aforementioned tourism as key

Visit http://www.brasilglobalnet.gov.br for more information.

Visit http://www.vitrinedoexportador.gov.br/ve/en for more information.

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WANT TO IMPORT FROM BRAZIL?

investment sectors. An Olympic host city typically needs 50,000 to 60,000 beds. Cosmetics are another major opportunity. On average, Brazilian women spend 40 percent of their disposable income on cosmetic products. But the hottest sector is technology. Brazilians have increasing purchasing power, but many live in underserved or rural areas where they don’t have access to the goods they want. So e-commerce is booming, estimated to be worth US$ 12 billion annually. The fastest growing Latin American e-tailer, sporting-goods company Kanui.com.br, saw web sales increase a whopping 9,000 percent in 2012, according to Internet Retailer. There is a vibrant accelerator scene funding startups within Brazil, and investors from outside the country are also bullish. California-based SVB Capital invested in Brazilian venture capital firms last year through a US$340 million fund. “The Brazil economy in the next few years will be one of the third or fourth largest economies in the world,” says Aaron Gershenberg, a managing partner at SVB. “If you’re going to look at some diversification in your portfolio, in the innovation economy, Brazil is a very natural geography to have exposure to.” Meanwhile, entrepreneurs from the U.S., Germany and France have already set up shop in Brazil. New tax incentives for tech companies are on the horizon, possibly clearing the way for even more.

Petrobras will invest US $ 220.6 billion between 2014 and 2018

The Board of Directors of Petrobras (Brazilian National Oil and Gas Company) approved on February 25th, the Business Plan and Management of the company for the period 2014-2018 and the Petrobras Strategic Plan 2030. For the first fixed period of 2014-2018 the investments are to be US$ 220.6 billion and focuses on the short and medium term. In the long-term, the goal for the business is, by 2030, to be one of the five largest integrated energy companies in the world.The Petrobras Strategic Plan 2030 provides for the growth of oil production from Petrobras until 2020 and its sustainability in the period 2020-2030, with the potential to produce an average of four million barrels of oil per day (bpd). This production target is founded on the different rhythms of auctions that will be promoted by the government, in which the company provides to the data available today that oil production in Brazil,

One of the oil drills under operation by Brazilian state-run energy giant Petroleo Brasileiro S.A. or Petrobras (PBR).

including that which Petrobras own and others, reach the average 5.2 million bpd over the period 2020-2030.From the growth of oil production, the plan defines strategies for the other segments of the company.The emphasis is on the integrated operation of oil and natural gas, with the expansion of refining capacity to 3.9 million bpd in 2030 and the growing supply of natural gas to the Brazilian market.

Internationally, the Strategic Plan recommends emphasis on the exploitation of oil and gas in Latin America,Africa and the United States. The plan establishes guidelines for corporate activities of the company in the areas of profitability, social responsibility and integrated growth. The statement stated one of the challenges is tomaintain the technological system recognized forproviding technologies that contribute to sustainable growth of the state.

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Brazil sent in 2013, 26.3 thousand tons of rice and beans to 16 countries in a situation of economic and social vulnerability, that suffered from public disasters. Donations provided food and nutritional supplementation to approximately 174 thousand families for a year, which corresponds to a population of around 870 thousand people.In total, there were 26,035 tons of rice shipped which brought benefited to 16 countries and 233 tonnes of beans to Ecuador. The countries assisted were: Algeria (2,170 t), Bangladesh (895 t), Bolivia (300 t), Burundi (2,000 t), Congo (524 t), El Salvador (1,005 t), Ecuador (578 t), Ethiopia (1,513 t), Guatemala (5,056 t), Honduras(7,596 t), Madagascar (1,000 t), Nicaragua (1,694 t), São Tomé and Príncipe (180 t), Somalia (1,575 t), Uganda (118 t) and Zimbabwe (64 t). In quantity per region, Central America received 16,229 t, followed by Africa with 9,144 t and Asia, with 895 t, representing 61.78%, 34.81% and 3.41%, respectively. Brazilian donations occurred through the national supply company (Conab) in cooperation with the ministries of agriculture, livestock and food supply (Mapa) and of Social development and fight against Hunger (MDS).

Brazilian donations have benefited more than 870 000 people in the world

IMPORT OPPORTUNITIES FOR KENYAN COMPANIES

Kenyan importers have a variety of goods and services to import from Brazil. Brazilian economy has developed over the years and currently Brazil offers a variety of exports to the international market. Brazil mainly exports aircrafts, domestic and industrial appliances, heavy machinery for mining, building and construction, agricultural equipments, machinery and implements, tractors and aluminum wire to Kenya. Brazil has trained its sights on Kenya, seeking investment projects in sectors such as agriculture, heavy machinery, engineering, building and construction, packaging, textiles, fruits, cereals, plastic bags, furniture, lens and optical, shoes, information, communication and technology equipments, automobiles, healthcare products among others.

Infrastructure: The need to develop the northern corridor network that comprises of the road and rail network between the port of Mombasa and Tororo on the Ugandan border, taking in along the way, Nairobi and Kisumu. There are several road construction opportunities in the country for Brazilian construction companies.

Horticulture: This is a special focus on fruits and vegetable production, cut-flowers, french beans, mangoes and other fruits. There is need for processing and packaging of these products for exports to the international markets Attention should be paid on agro-processing and valuation for horticultural and agricultural products.

Tourism: Kenya offers fine natural attractions, combined with a network of hotels and game lodges that give visitors good value for their money, thus Kenya remains a natural tourism magnet. There is need for investing in hotels that will help increase in 35 percent bed capacity demand.

BUSINESS OPPORTUNITIES FOR BRAZILIAN COMPANIES

According to the Kenya Investments Authority, the government parastatal under the former Ministry of Finance in charge of investment promotion, the following areas have been identified as the potential investment opportunity areas:

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Renewable energy: There is need for increased power supply and therefore need to generate affordable power through sources like geothermal, wind, biofuels, etc to meet the high demand for power which is growing at 7 percent per year.

Natural resource extraction: With the discovery of oil, titanium, natural gas and other minerals, this has created opportunities in this sector that needs to be exploited by the Brazilian companies notably in drilling and refining of oil.

Information and communication technologies: The emergence of cutting edge technology and the desire for Kenya to be an ICT hub for East and Central Africa has created opportunities in technological transfers. Konza techno city is such a noble project that Brazilian companies can explore.

Privatization and venture capital investment: With more than 150 companies to be privatized, the government will be issuing bids for foreign companies to express interest to partner with other investors. The companies to be privatized are from the sugar sector, banks, hotels, cement manufacturing, railways, among others.

Merchandise trade: Opportunities exist in leather and leather processing, processing of meat products, honey processing and supply of farm machineries and equipments, fertilizers and certified seeds. There is need for in-vesting in agribusiness in Kenya.

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TRADE FAIRS AND EXHIBITIONS IN BRAZIL (MARCH & APRIL 2014)EXPOPARANAVAÍ(43rd Agricultural and Industrial Exposition of Paranavaí)March 7 – 16, 2014Lines of Products and/or Services: Exhibition and sale of motor vehicles, agriculturalmachinery and implements, equipment and supplies for poultry, tractors, trucks, cattle,horses and food plaza, art shows, rodeo, rural showcase, technical talks on agriculture and artisan. Venue: Parque de Exposição Presidente Arthur da Costa e Silva – Paranavaí – PRWebsite: www.srparanavai.com.brContact: secretaria@srparanavai.com.br

EXPODIRETO COTRIJAL(15th Expodireto Cotrijal International Fair)March 10 - 14, 2014Lines of Products and/or Services: Agrochemicals, fertilizers, machinery and implements, storage, services, education, extension, livestock, environment and financial institutions.Venue: Park Expodireto Cotrijal - Não Me Toque- RSWebsite: www.expodireto.cotrijal.com.brContact: expodireto@cotrijal.com.br

HORTIFRUTI BRASIL SHOW(2nd Agroindustrial Complex Fair of Vegetables, Fruits and Flowers Chain Production)March 13 - 15, 2014Lines of Products and/or Services: Vegetables, fruits and flowers.Venue: Ceasa Curitiba - Curitiba - PRWebsite: hortifrutibrasilshow.com.brContact: comercial-01@pjeventos.com.br

ABRADILAN FARMA E HPC(10th National Fair of the Pharmaceutical Sector)March 19 - 21, 2014Lines of Products and/or Services: Pharmaceuticals and cosmetics, nutritional products, herbal to apiterápicos, personal hygiene, perfumery, medicines and hospital doctors. Venue: Centro de Eventos do Ceará - Fortaleza - CEWebsite: www.dinamicaeventos.com.brContact: dinamica@dinamicaeventos.com.br

EFAPI(42nd Agricultural, Industrial and Commercial Exhibition Fair)March 21 - 30, 2014Lines of Products and/or Services: Machinery, farm implements, equipment and supplies for poultry, vehicles, tractors, trucks, cattle, food court, shopping and amusement park. Venue: Parque de Exposições Dr. Alício Dias dos Reis - Santo Antônio da Platina - PRWebsite: efapiexpo.com.brContact: atendimento@srnortepioneiro.com

EXPOAGRO AFUBRA(14th Agricultural Technologies, Products and Services Exhibition)March 25 - 27, 2014Lines of Products and/or Services: Dynamics of agricultural machinery,agricultural products, supplies, tools and equipment, animals, lectures, demonstration farms,agricultural technical meetings business, agribusiness, production of ethanol and biodiesel and mobile sawmill. Venue: Parque de exposições - Rio Pardo - RSWebsite: afubra.com.brContact: expoagro@afubra.com.br

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EXPO ABIÓPTICA(12th Latin America Optics Exposure)April 2 - 5, 2014Lines of Products and/or Services: Sunglasses, frames, lenses, accessories andequipment. Venue: Expo Center Norte - São Paulo - SPWebsite: www.expoabioptica.com.brContact: abioptica@abioptica.com.br

BRASIL ALIMENTA(9th Industry and Food Processing Technology Fair)April 8 - 11, 2014Lines of Products and/or Services: Technology, products and services for familyagriculture, manufacturing and food processing. Venue: Fundaparque Parque de Eventos de Bento Gonçalves – BentoGonçalves – RSWebsite: www.brasilalimenta.com.brContact: caex@newtrade.com.br

HAIR BRASIL(13th Beauty, Hair and Aesthetics International Fair)April 12 - 15, 2014Lines of Products and/or Services: Products, services and equipment for beautysalons, beauty clinics, spas and other beauty establishments. Venue: Expo Center Norte - São Paulo - SPWebsite: www.hairbrasil.comContact: hairbrasil@hairbrasil.com.br

SUCRONOR(6th Northeast Sugar-energy Exhibition)April 22 - 25, 2014Lines of Products and/or Services: Equipment for the production of sugar and ethanol, renewable and non-renewable. Venue: Centro de Convenções de Pernambuco - Olinda - PEWebsite: www.sucronor.com.brContact: contato@reedmultiplusnews.com.br

AGRISHOW(21st International Agricultural Action Technology Fair)April 28 - May 2, 2014Lines of Products and/or Services: Machinery, equipment and agriculturaltechnology. Venue: Rodovia Antonio Duarte Nogueira Km 321 | Ribeirão Preto - SP Website: www.agrishow.com.brContact: agrishow@btsmedia.biz

Compiled by the Trade Promotion and Commercial Section, Embassy of Brazil, Nairobi, Kenya. Tanar Center,UN Crescent road, P.O. Box 30754 - 00100 Nairobi. Tel: +254 20 712 5765/6 Cellphone: +254 733 606460 Fax: +254 20 7125767

Email: secom.nairobi@itamaraty.gov.br Website: www.nairobi.itamaraty.gov.br