Bahia Basics facts

Predictability, good regulation and respect for contracts.

Source: International Trade Statistics-2008

Bahia is a new growth engine

BAHIA INFRASTRUCTURE PROJECTS

BAHIA INFRASTRUCTURE PROJECTS

Brazilian Macroeconomics

BAHIA INFRASTRUCTURE PROJECTS

Liking With the Pacific Puerto Bayovar

PERU

Linking with the Atlantic South Port to the North of the Port of Ilhéus ** - BAHIA

Railroad Transulamericana

International Trade Outlook

Brazil - Merchandise Exports by Region,2009

Source: International Trade Statistics-2008

Strategic Logistic and Transport Plan

Commodities leads the way

Bahia Iron Ore Reserves

Bahia East-west RailroadBahia Port / Caetité Extension: 505 kmCaetité / Luis Eduardo Magalhães Extension: 470 kmTotal Value: R$ 2,8 billionsTerm: 2011

Bahia in The Brazilian Strategy

Space Repercussion and Territoty

Bahia Challenges & Opportunities

Global Development 2010: Shifting Wealth

Perspectives on Global Development 2010The changing dynamics of the global economy over the last 20 years, and the impact of the economic rise of large developing countries, such as China and Brazil highlights the strengthening of “south-south” links – the increasing interactions between developing countries through trade and foreign direct investment.In 2009 China became the leading trade partner of Brazil. As of 2008, developing countries were holding USD 4.2 trillion in foreign currency reserves, more than one and a half times the amount held by rich countries. These are just a few examples of a 20-year structural transformation of the global economy in which the world’s economic centre of gravity has moved towards the east and south, from OECD members to emerging economies, a phenomenonal “shifting wealth”. Perspectives on Global Development shows how developing countries have become important economic actors and demonstrates the dynamism of the new South-South economic ties. Although the process has been ongoing for 20 years, the opportunities and risks for poor countries posed by shifting wealth are only starting to be understood.

The increasing importance of the South to the South• The direct channels of interaction between the emerging giants – such as trade,

foreign direct investment (FDI) – have been intensifying. This trend is likely to continue. Between 1990 and 2008 world trade expanded almost four-fold, but South-South trade multiplied more than ten times. Developing countries now account for around 37% of global trade, with South-South flows making up about half of that total.

• This trade could be one of the main engines of growth over the coming decade, especially if the right policies are pursued. The OECD suggest that, were southern countries to reduce their tariffs on southern trade to the levels applied between northern countries, they would secure a welfare gain of USD 59 billion. This is worth almost twice as much as a similar reduction in tariffs on their trade with the north.

• South-South FDI has also increased. China is the largest developing country outward investor with an investment stock estimated at more than USD 1 trillion. However, the phenomenon is broader, with growing activity from many firms in Brazil, India and South Africa, as well as new smaller outward investors from countries like Chile and Malaysia. South-South investment has enormous untapped potential for low-income countries. Southern multinationals, for example, are more likely to invest in countries with a similar or lower level of development since they often have technology and business practices tailored to developing country markets.

Potential gains from South-South trade liberalisation Billions of USD

A win-win situation?• Improvements in the range and quality of exports, greater

technological dynamism, better prospects for doing business, a larger consumption base – all these factors can create substantial welfare benefits for the whole world.

• That is not to deny the challenges. Environmental sustainability, growing levels of inequality within countries and increased competition are three significant issues raised by shifting wealth. The birth pains of this new economic world order have also been accompanied by enormous global imbalances. These challenges have come to the forefront during the economic crisis, but have been building over the last two decades. Despite these challenges, this report argues that the overall picture is a positive one for development.

Economic policies should:

• Development strategies to cacth the opportunities of shifting world.

• promote South-South foreign direct investment, learning the lessons from successful clusters and Export Processing Zones and using investment links to achieve technological upgrading through national innovation systems;

• ensure appropriate revenue management policies in resource-rich economies and contemplate using sovereign wealth funds to promote growth and investment in the domestic economy;

• respond to the growing demand for agricultural exports to improve agricultural productivity, through greater support to R&D and extension services, and technological transfer.

O Vetor de Expansão Oeste é

um programa de

Desenvolvimento Urbano com

forte impacto na mobilidade:

•Redução de distâncias

rodoviárias para BR- 242, BR-

116,BR-101, Baixo Sul,

Itacaré-Ilhéus

•Interligação rodoviária dos

Portos de Aratu / Porto de

Salvador / Novo Porto Sul

•Melhoria da mobilidade em

direção ao Litoral Norte por

diminuição da concentração

do vetor atual de crescimento

da RMS

Vetor de Expansão Oeste Ponte Salvador Itaparica Vetor de Expansão Oeste Ponte Salvador Itaparica

BAHIA INFRASTRUCTURE PROJECTS

Ponte Salvador – Itaparica

Ponte Salvador – ItaparicaPonte Salvador – Itaparica

Ponte Salvador – Itaparica

SISTEMA PONTE SALVADOR-ITAPARICA / BR-116 / BR-101 / BR-242

Railway, Port and Airport Railway, Port and Airport

Intermodal Transport System

Intermodal Transport SystemPort - Airport - Railway - Roads

Industrial Tax Incentives:

Market and supplier access are the main factors affecting investments entry. Also the access to customers and suppliers of inputs are key determinants of FDI inflows.

Our Governments spend large sums of money to entice foreign direct investment (FDI), offering generous tax incentives. We believe that foreign firms will generate positive externalities on domestic firms.

The State fiscal Programs: Desenvolve and Probahia support with tax isention the atraction of foreign direct investment (FDI) .

Industrial Tax Incentives:

Market and supplier access are the main factors affecting investments entry. Also the access to customers and suppliers of inputs are key determinants of FDI inflows.

Our Governments spend large sums of money to entice foreign direct investment (FDI), offering generous tax incentives. We believe that foreign firms will generate positive externalities on domestic firms.

The State fiscal Programs: Desenvolve and Probahia support with tax isention the atraction of foreign direct investment (FDI) .

Incentives for direct investment (FDI)

Free Tax AreasZPE Zonas de Processamento de Exportação

Fonte Nova

World Cup 2014The Brazilian StrategyWorld Cup 2014The Brazilian Strategy

•The sense of urgency created by the advent of the World Cup in 2014 and the Olympics in 2016 can be very positive for Brazil as this stirs the public and private sectors to carry out badly needed infrastructure investments.

•The sense of urgency created by the advent of the World Cup in 2014 and the Olympics in 2016 can be very positive for Brazil as this stirs the public and private sectors to carry out badly needed infrastructure investments.

Projeto Fonte Nova

• The project is under progress as Private Public Partnership

(PPP) to build and operate a new World Cup 2014 stadium.• The stadium will feature seating for 50,000.• Transportation, energy, sanitation, and other infrastructures

of the project will be developed to meet international standards.

• Hosting of the World Football Cup in 2014 and the Olympic games in 2016 will stimulate much response, the construction of roads, airports, and stadiums.

World Cup 2014 Stadium

• The World Bank predicts that if Brazil continues on the path it is on now, it will move from being the tenth largest economy in the world today to the fifth largest by 2016.

• The sense of urgency created by the advent of the World Cup in 2014 and the Olympics in 2016 can be very positive for Brazil as this stirs the public and private sectors to carry out badly needed infrastructure investments.

Why Invest in Bahia?

The choice of industrial leaders:

•Ford Motors Automotive Complex: U$ 1,9 Billion investment. Production capacity for 250.000 vehicles / year.• •Paper and Pulp Industry : Investments of more than U$1,5 billion over the last 5 years

•Oil and Gas Industry: New oil discoveries raising Brazilian reserves from 14th place to 4th place in the world.

The choice of industrial leaders:

•Ford Motors Automotive Complex: U$ 1,9 Billion investment. Production capacity for 250.000 vehicles / year.• •Paper and Pulp Industry : Investments of more than U$1,5 billion over the last 5 years

•Oil and Gas Industry: New oil discoveries raising Brazilian reserves from 14th place to 4th place in the world.

Oil Industry Investments•The oil giant Petrobras had total revenues of $92 Billion in 2008 and a total profit of $14B. Brazil has 12.6 billion barrels of proven oil reserves, the second-largest in South America after Venezuela.

•Petrobras has announced the world’s largest capital expenditure programme, worth $220 billion over the next five years.

The large discoveries of offshore oil made by Petrobrás have made it ease to forget that Brazil is already the world´s largest exporter of coffe, sugar, chickens, beef and orange juice. It also exports vast amount of soya and iron ore, as well as other ores and metals.

Logistic Multimodal Transport Plataform

Investiment: us $ 50 milions. TIR around 18%

Juazeiro Logistic Plataform• Juazeiro has a privileged geographical location in the center

of brazilian northeast, and the radial connection around Juazeiro in addition to its network, facilitate the transport of merchandise and favors the intermodal infrastructure.

• Nearby Petrolina has a good intermodal infrastructure and facilities that connect with those of Juazeiro. Together, the two interact synergistically to create a logistic platform.

• Platforma Logística do São Francisco is a PPPI project to convert Juazeiro into the largest logistic platform in the Brazilian Northeast.

Romeu Temporal

Governo do Estado da Bahia

Secretaria de Planejamento