Brazil also has multinational

It is a basket of reasons that has no parallel in the history of Brazil. Never, like now, He was spoken much of protectionism in world trade, the new business environment arising from globalization, robustness displayed by considerable part of Brazilian companies, the exchange rate with the gift of making the cheapest assets abroad and saturation of markets. It may not seem, but this assortment of reasons is all about, is very, with the impressive international climbing undertaken by national firms, they are buying companies and opening branches in increasingly remote locations, treading the steps began to be taken, decades ago, Petrobras, revered today as the world's sixth largest oil company, second consultant PFC Energy classification.

Similarly, as highlights John Paul Candia Veiga, political science professor at the University of São Paulo (USP) and researcher at the International Negotiations Studies Center (caeni), the sustained growth of domestic, the heated world economy, favoring surplus in trade balance by exporting commodities, and interest rates that help bring resources to the capital markets encourage companies to internationalize through the capitalization of IPOs (which stands for initial public offerings). “And there is the prospect of rising rating to Brazil, through investment grade, who has just crowned this synergistic process”, Kitchen Apron he.

Until recently resigned to being just a safe haven for companies of more advanced nations, the country is seeing its multinational singrarem with northern and southern seas voluptuousness. An increasing number of them began to adopt active strategies of international insertion through not only export, but the installation of associated companies abroad, explains Professor Antonio Correa de Lacerda, the Pontifical Catholic University (CAN I) from Sao Paulo. Author of Globalization and Foreign Investment in Brazil e denationalization: Myth, Risks and Challenges, he notes that the advantageous side of economic globalization lies in greater access to global capital markets and greater exposure in various regions of the planet, overcoming tariff and non-tariff.

In 2006, by way of direct investment, the Brazil poured abroad US $ 28 billion, according to the United Nations Conference on Trade and Development (Unctad), organ of the General Assembly of the United Nations (HIM), amount that exceeded US $ 9 billion the inflow of capital in the country during the same period and for the same purpose. It is true that this high value was influenced by the disbursement of US $ 17 billion funded by Vale (former Vale do Rio Doce) to take control of the Canadian mining company Inco, the second largest nickel producer in the world and activities in Canada, Indonesia and New Caledonia (French overseas territory located in Oceania) – e, to this opportunity, the largest acquisition ever made by a country emerging company in a developed nation. Brazil has, So, to occupy a prominent position in the group of major global investors, an assault that began to gain momentum in 2004, from fusion between Brazilian Ambev and Belgian Interbrew, agreement that gave rise to the Inbev, one of the most representative beverage industrial branch of conglomerates. “The main line of our trade policy has always been based on the export”, Michel Alaby knee, foreign trade consultant. “We take long to understand that the internationalization of companies should consider installing subsidiaries by building new plants or buying established companies.” Alaby said that there is no government planning for it, contrary, for example, what happened in China, which offered tax and financial incentives and signed promotion agreements and reciprocal protection of investments with more than one hundred countries.

Vale and Gerdau

The decision to settle abroad, advancing like a wildfire and gains an increasing number of supporters, You are coming to market knowledge through headlines that testify to the new reality. Examples abound: “Agrale will produce trucks in Argentina”; “Votorantim buys Prairie, In the USA”; “Tramontina Expands Presence in Dubai”.

“Although each case responds to its own set of factors to explain the internationalization of Brazilian company, some of them seem to gain relevance”, observes Rodrigo Cintra, director of Focus R.I. - Advice & Consulting in International Relations and a professor at the Escola Superior de Propaganda e Marketing (ESPM). He cites the maturity of Brazilian economic-productive system, allowing greater competitiveness of products made in Brazil no external market, and the need to expand the consumer base, which has the virtue of reducing the costs of their own internationalization process.

This should explain, partly, the worldwide expansion of Vale, present in more than 30 we countries on five continents, including operations and sales offices and mineral research, and Rio Grande do Sul Gerdau, 14Th largest steel producer in the world and leader in long steel in the Americas. Owner of a vast conglomerate of industrial and commercial units, Besides joint ventures and affiliates, Gerdau operates subsidiaries in Argentina, Canada, Chile, Colombia, Spain, U.S, India, Mexico, Peru, Dominican Republic and Venezuela. With annual production capacity of 24,8 millions of tons, earned $ 34,2 billion in the last financial year. In the USA, where I grew up buying competitors, only with Chaparral Steel - second largest steel producer in North America and one of its most recent acquisitions - disbursed $ 4,22 billion. And what's also southern Marcopolo, manufacturer of bus bodies which launched anchors abroad years ago today and watch your sign shine in ever more distant places? “Operations in Colombia, Mexico, South Africa, Portugal and, last year, Russia, Argentina and India made room for an odd growth of our activities”, knee Ruben Antonio Bisi, International Operations Director of the company. “Production jumped from just over 12 thousand units, in 2003, for almost 18 thousand last year, and must overcome 20 thousand this year.” Bisi says that the growing demand for buses in emerging markets like India and African countries, besides Russia, give support to this increase.

enabling environment

The fact is that the list of companies that are leaving for internationalization continues to gain new participants, making Brazil a respectful investor on the world stage. “The weakness experienced by some economies in Europe and even the United States, and the sharp depreciation of the dollar, It provides a favorable environment to Brazilian companies”, stresses Alex Agostini, chief economist at Austin Rating, rating agency credit risk. He points out that “the recognition of the Brazilian brand worldwide is a trend that should be emphasized going forward, either by increasing demand for commodities, is the financial strength gained by national companies some years ago”. But, as bails Germano Mendes de Paula, Professor of the Economics Institute of the Federal University of Uberlândia (UFU), “a company that choose to gather, before, the conditions necessary to invest abroad never will, because competitors are improving all the time”. Paula Mendes says that, between 1930 e 1980, companies in the domestic market grew by diversifying, since it was easier to enter new markets in Brazil than venturing through the installation of foreign subsidiaries. “In subsequent decades, the main concern was survival, so much so that now only Brazilian companies begin to engage more intensively in the productive internationalization game”, says.

Indeed, never as nowadays the installation of branches abroad has gained so much emphasis. “It will be more competitive the company is present in more countries”, says Henry Lent, Federation Director of Industrial Relations State Industries of Santa Catarina (Fiesc). He warns that, if Brazilian companies do not invest in the field of competitiveness or fail to seek markets in other markets, eventually suffocated by internal competition. “You can no longer think only in the local market. Today, trade companies is the world”, states.

I was thinking how industries such as Santa Catarina WEG expanded their horizons, investing in branches in strategic points of the globe despite the challenges that this type of initiative is. Manufacturer of electric motors and among the first in the industry worldwide, the company owns a bunch of production lines in Brazil and factories in Argentina, China, Mexico and Portugal. “WEG has always felt the need to invest in research and in the foreign market, later, the opening of branches”, clarifies Celso Vili Siebert, company's regional director for South America, Australasia and Africa.

The flight towards the exterior is impressive. Professor Paula Mendes points out that there is strong evidence that, in several cases, internationalization stems from the need to be next to the main customers, tactic usually called follow my customer. This is also thought Álvaro Cyrino, professor and researcher of the Internationalization Core Fundação Dom Cabral (FDC), executive development center, entrepreneurs and companies. According to him, markets are increasingly interconnected and we need to be closer to customers in order to better respond to their demands. “Strategic bidding companies can no longer be seen only from the perspective of a single country”, full. Paula Mendes agrees, stating that this strategy is particularly evident among the companies of the automotive industry.

OR EXEMPLARY da Soap

The case of São Paulo is emblematic Sabó. Important producer of auto parts specialized in the production of seals and gaskets, mechanical seals and training systems, she designed world marked by an expansionary policy that has highly of physical proximity to the customer. “The arrival of globalization, in the late 1990, Sabó found with their feet firmly on the outside thanks to its export programs, that come from the late 1970, when we began to provide for Opel, in Germany”, says Luiz Carlos Vinicius Freitas, the company's marketing director.

Freitas reports that these acquisitions started by Argentina, in 1992. “Next year, We assume command of Kako, in Germany (several production units that meet, today, almost 30 assembly lines). In 1997, We opened a branch in Hungary, following the Audi, He was settling in the country by building an engine plant. Then came the US, in order to give attention to the needs of Axle, traditional axes industry, that was having serious problems with quality assurance and the old supplier.” The marketing director says that the Sabó also operates offices in China, England, Italy, France and Japan, and will inaugurate a factory in China, in 2008. “And we are considering the establishment of a production line in India”, confidence.

Increasingly expanding into the overseas market is led by companies providing services. Take the example of Ibope, encastelado among the largest research institutes and branches in Argentina, Bolivia, Chile, Colombia, Costa Rica, Ecuador, U.S, Guatemala, Mexico, Panama, Paraguay, Peru, Portugal, Uruguay and Venezuela. And CPM Braxis, positioned between the big information technology sector (TI) on the continent and hiding not want to expand its global market share growing, mainly, on American soil. “Our expansion in the United States allows better service to customers located in the country, in addition to position Brazil among the major exporters of IT solutions”, says Alvi Abuaf, President of CPM Braxis International. With 5 thousand employees, 200 customers and 14 application development centers, the company also operates in Europe and in much of Latin America. There is also the case of Tito Global Trade Services, provider of services in international logistics and trade with external bases in Argentina, Mexico and the US. “The fact of giving service to importers and exporters in Brazil has led us naturally to offer the same set of services on the tips, suppliers and buyers”, emphasizes Hermeto Bermúdez, Company CEO. According to the executive it is essential that the new knowledge on local bases are “globalized”. Competition abroad, especially in more sophisticated markets, improves the competitiveness of the company as a whole, in that learning is transferred to the headquarters and other subsidiaries, stresses Professor Alvaro Cyrino, da FDC.

Looking into

Decidedly, open branches abroad is not for beginners. “The foreign market is not made for inefficient firms”, Olavo explains Henrique Furtado, International Business Center consultant Trevisan Consulting and professor Trevisan Business School. He says that before seeking any type of foreign operation - either through export or opening branch - the company must look within, unveil its advantages and adjustments that necessarily have to be made. The consultant argues that the internationalization of investment is the rule in the world market, not treating more, therefore, a decision of this or that country or region. “We face all kinds of difficulties”, reports Flavio Balestrin, Director of International Expansion Totvs, company dedicated to the development of enterprise management software and also committed to gaining ground outside. He informs that the first unit of Totvs abroad was born in Argentina, for over ten years, invested pioneer which included, later, associated opening in Chile, Mexico, Uruguay, Paraguay, Puerto Rico and Portugal.

Some of these international forays relied on the help of the BNDES, that provides a specific line of financing for such operations. In the case of acquisition by JBS-Friboi unit of Swift Armor, in Argentine, reports the official bank, It was granted a loan of R $ 140 millions. The same line of credit has been used by Cooperativa Agroindustrial Lar to establish two-storing plants in the Paraguayan districts Mariscal Francisco Solano Lopez and Yguazú, the amount of R $ 6 millions, and the CPM Braxis, for the assembly of a commercial structure and sales abroad by investments of R $ 3,68 millions. Livia Ferrari, the BNDES Communication Area, also mentions funding made Itautec, the amount of R $ 142,6 millions, and had as research destination, the development and innovation of products and processes, the increase in production capacity and the expansion of the international activity of the company through the acquisition of a computer products distributor in the United States. “The country wants to compete in foreign markets must be sized companies to compete”, says Carlos Gastaldoni, Superintendent of BNDES Industrial Area. “And to achieve this dimension, it is necessary that the Brazilian groups become,, actually, International”, ends.

Brazilian Problems Magazine – nº 387 – May / June 2008
Source: http://www.sescsp.org.br/sesc/revistas_sesc/pb/artigo.cfm?= 309 Edicao_Id&breadcrumb=1&= 4825 Artigo_ID&IDCategoria = 5524&reftype=1