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railroad opportunities in Brazil

Friday 14 January, 2011

I was invited to attend this business briefing: Opportunities in Brazil’s Rail Sector: A Business Briefing for U.S. Companies, organized by TERA International Group & sponsored by the U.S. Trade and Development AgencyHere‘s a link to a similar earlier project on which they worked.  After Steve Winkates of TERA welcomed everyone, Gabrielle Mandel of the USTDA gave an overview of their services.  Next Martin Claessens of the US Commercial Service referred people to their website to see what they do & promoted Obama’s National Export Initiative goal of doubling exports in the next 5 years to create 2M jobs.

The meat of the presentations started Britto Rajkumar, of the Transportation Technology Center, Inc., who provided the results of a USTDA-funded Railway Integration Technical Assistance Project (RITAP).  Brazil’s railroad system grew 100% in the last 10 years & is expected to grow 100% again in the next 10 years.  The focus today is on track standards for certification & safety, & so that they can be integrated across the country.  There is a 2 year pilot project & 5 year comprehensive plan to guide privatized railways to meet growing demand.  They are building 60K km in Brazil, of which 700 km are in/around Sao Paulo.  For comparison, the US has 300km of track nationwide.

Brazil’s International Affairs Advisor to the Ministerio dos Transportes, Francisco Luis Da Costa, then described Brazil’s logistical infrastructure.  The 2008 financial crisis has had little impact on Brazil’s economy, & actually increased public investment.  Foreign direct investment is up, & foreign reserves are up.  Their focus is more on internal market growth than export.  They are trying to plot a sustainable growth path:  infrastructure investment has increased 20% in 2010.  Brazil has agreed with the IMF in that infrastructure requires different fiscal treatment than other investments.   Currently Brazil depends more on roads & highways than rail, especially compared with other countries.  Their Plan for Logistics & Transport plans to change the matrix of rail & waterways directly to production areas.  Their focus is on energy efficiency, & reducing fuel consumption & emissions.  Rail is a priority, emphasized by expansion to create a modern integrated high capacity system to optimize:

  • existing network capacity
  • multimodal
  • high speed
  • North-south backbone
  • connect production areas to ports which are served by trucks now

Brazil is converting from large 1.6m gauge to more narrow 1.0m gauge & creating urban bypasses & beltways.

Other association presentations were given by:

Other visiting Brazilian delegate presentations were made by:

  • Antonio Carlos Modesto de Oliveira, Legal & Corporate Affaris Director of Ferrovia Tereza Cristina (FTC)
  • Elvira M B Cavalcanti, CFO & Thiago Rosa Moraes, Procurement Specialist of MRS Logistica SA
  • Flaviana Crus Coelho, Director General of Innovation & Railway Development & Jose Osvaldo Cruz, Office of Institutional Relations for Vale
  • Marcello Barreto Marques, Commercial Executive Officer & Miguel Angelo Barroso Andrade, General Business Development Manager of Transnordestina

I had to leave this event early due to another commitment.  If you want more information, just let me know & I’ll see if I can go back to the sources.

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