Tag Archive: são paulo


By Connection Consulting

After providing consulting for numerous business to start up in Brazil, we have learned that there are a few subjects related to bureaucracy and perceptions about Brazil that catch foreigners by surprise especially when they are planning to set up or already are in the process to open their business in the country.

Based on our experience we decided to write this guide to clarify 4 of the most usual misconceptions that people have when bringing their business to Brazil:

Salaries are Very Low in Brazil

It is easy to think of Brazil as a country with cheap workforce so this may be the most common misconception of all people planning to set up in Brazil. Just to give you an idea of the evolution of the salaries, the minimum wage increased at an astonishing pace in the past years practically doubling if compared to the figures from 2002.

Right now the minimum wage is BRL 465. It is worth to note however that the gap between different categories is huge so you will rarely find any employee with a bachelor degree in engineering that earn less than BRL 3000. Salaries vary a lot from state to state, but for experts the salary may double or even triple.

Top that with high social costs and an extra salary per year (the 13th salary) and will you have a idea of the annual cost of an employee for the company.

Companies can be Opened on a Blink of an Eye

Unlike the process in the US or in most European countries where opening a company is quick and usually require filling out a form or two, the Brazilian company formation process is far more complicated and time-consuming. Different authorities, licenses and taxes are involved depending on the type of company you are planning to open and it can take from one to six months before your company is operating. 

The fact that there is foreigner presence in the company also makes the process slower and more expensive due to extra translations costs.

Rio de Janeiro is the Only City to be

Some people tend to be fooled by the status that Rio de Janeiro has as a vacation destination thinking that such status also applies for business. We are not trying to say Rio de Janeiro is not a good place to establish your business, but you should be aware that there are other places in the country with great potential and that may even offer incentives such as free plots of land for you to build your business or tax reductions. 

São Paulo is still considered the business capital of Brazil and alone corresponds to 15% of the country’s GNP. Also three quarters of the all business events in Brazil happen in São Paulo. Manaus is also an interesting place for electronics manufacturing business due to its free trade zone regulations.

Get your Brazilian Documents in Brazil

Foreigners sometimes get overwhelmed by the amount of documents that are necessary to live in Brazil and the most natural perception is that it will be easier to obtain all documents once they are in Brazilian soil. That is not always true. 

Some documents, for example the CPF, can also be obtained in the Brazilian Consulate so it worth to check with them if they can assist you. You are little likely to get information in English from the authorities in Brazil, so besides of having help in your own language, the Consulate is more used to handle request from foreigners.

Photo by Pedro Kirilos/Riotur

By VICTORIA GOMELSKY, from The New York Times

 

Rio is expected to attract billions in public and private investment over the next few years.

RIO DE JANEIRO — On Alexandra Daly’s most recent visit here in May, she was booked into a hotel across the street from the most happening stretch of Ipanema beach. The perk, however, proved irrelevant. Ms. Daly had not bothered to pack a bikini.

“I had nine meetings in one day,” said Ms. Daly, a hedge fund marketer, whose London-based company, AA Advisors, works with about 35 major Brazilian investors. “I don’t even have days like that in New York. When you’re talking about Rio, people think of samba, Sugar Loaf mountain and the beach — not the billion-dollar investment industry.”

The conventional view of Brazil’s two largest cities is that São Paulo, with its banks, commerce and industry, got the brains, while Rio, with miles of crescent-shaped beaches, Carnival revelers and picturesque bay, got the looks. But the truth is that the “Marvelous City,” as Rio is known, is increasingly a serious destination for business travelers.

Brazil’s growing standing among global financiers is one explanation. Poised to become the world’s fifth-largest economy by 2016, the country has emerged from recession virtually unscathed, earning the envy of its Group of 20 cohorts.

São Paulo is the center of the boom. But Rio brings plenty of opportunities to the table, not only with its core oil and natural gas businesses, but also in financial services, technology and telecommunications.

An August 2009 study, “Decision: Rio Investments 2010-2012,” published by the Rio de Janeiro State Federation of Industries, predicted that public and private investment would pump $60.3 billion into the state over the next three years, not counting the additional $14.2 billion budgeted for the 2016 Olympic Games.

“I would dare to say that, probably, we have the biggest concentration of billion dollars in investment per square kilometer in the world,” said Cristiano Prado, the author of the industry federation’s study. “And more will come together with the Olympic Games in the next years.”

Not since 1808, when the Portuguese monarchy sailed into Guanabara Bay, fleeing Lisbon ahead of Napoleon’s army, has Rio seen such a spectacular influx of wealth. And not since 1960, when Rio ceded its capital status to Brasília, setting off an exodus of businesses and a half-century of urban decline, have Cariocas, as Rio’s residents are called, had a reason to believe the wealth would return.

“There is hope that with a government that is more pro-business, more things will happen in Rio,” said Ronaldo Veirano, founding partner of Veirano Advogados, a Rio-based law firm that worked on the federation’s study. “Hotel chains are now thinking seriously about their capacity and authorities are investing in infrastructure. I don’t think Rio will ever be another São Paulo but I think it could recover some of its glamour.”

The most conspicuous hurdle is an epic crime problem that has branded Rio one of the world’s most dangerous cities. On Oct. 17, for example, drug-trafficking gangs inside a favela, or slum, shot down a police helicopter in a series of clashes that left three police officers and at least 23 others dead.

Government leaders are eager to project a different image to the business community. “Clearly, the model we have is Barcelona,” said Felipe Góes, Mayor Eduardo Paes’s secretary of development.

Like the Spanish city, which cleaned up in time to be host for the 1992 Olympics, Rio hopes to reinvent itself for the Games. Presiding over the transformation is the billionaire Eike Batista, a mining magnate whose EBX Group has interests in real estate, energy, oil and tourism.

One of Batista’s pet projects is the deluxe restoration of the venerable Hotel Gloria, a 1920s landmark five minutes from the city center, where two of the largest corporate players in Brazil, Petrobras and Vale, still have their headquarters. The opening of the refurbished hotel is planned for 2011.

Other hoteliers have taken notice. Rio’s grandest property, the 86-year-old Copacabana Palace, introduced its sleek new Bar do Copa in March.

Meanwhile, the two-year-old Hotel Fasano in Ipanema boasts the stylish Baretto-Londra Bar designed by Philippe Starck.

Another newcomer is the year-old Hotel Santa Teresa, set in an acre of gardens in the artsy, hilltop enclave of the same name, just 10 minutes from downtown but far away in atmosphere.

“The advantage is we have only 44 rooms, 4,000 square meters and 150 tropical trees on the property,” the general manager, Mark Birchall, said. “You feel almost as if you’re in the mountains.”

In general, Rio’s accommodation capacity, currently 28,000 hotel rooms, is expanding at the rate of 1,000 rooms a year, said Paulo Senise, executive director of the Rio Convention & Visitors Bureau.

“The idea is to increase that to 1,500 to 2,000 per year for a total addition of 14,000 hotel rooms by the Olympics,” Mr. Senise said.

Overcoming its reputation as a parochial party town looks to be Rio’s biggest challenge domestically. In São Paulo, the locals, known as Paulistas, have long derided Rio for its supposed lack of sophistication. Many recent visitors, however, insist that Rio offers plenty of fashionable dining and nightlife options, from the baroque antiquarian bars and clubs of Lapa, near downtown, to the posh beach cafes of Ipanema, Leblon, and Barra da Tijuca.

“In terms of service, you are not lacking in Rio at all,” said Ted Rogers, a Washington-based venture capitalist who has done business in Rio since 2006 and blogs about it at http://www.vc-brazil.com. “I’d argue that the way the city is laid out, you have easier access to the places you want to go than in São Paulo.”

International access is set to improve Dec. 15, when US Airways begins direct service to Rio from its hub in Charlotte, North Carolina, the largest banking headquarters in the United States after New York City.

For all its current mojo, however, Rio faces one inescapable deterrent to sober-suited business development. Riotur, the government-owned tourist office, spells it out in its colorful introductory guide: “It is very difficult for anyone who visits Rio to resist the appeal of its 86 kilometers of beaches.”

That is more than 50 miles of beaches.

Mr. Rogers, for one, doesn’t even try. He said his best business days began with a run on the beach, followed by a quick swim. The routine, he said, puts him “in a relaxed but energized mind-set.”

“It’s hard to stress about business when on the beach in Rio,” he said, as he planned a return trip to the city at the end of October. “And by the end of the weekend, it is equally hard not to feel rejuvenated.”