Private Equity and Venture Capital in Brazil - BVCA admin
Private Equity and Venture Capital in Brazil - BVCA admin
Private Equity and Venture Capital in Brazil - BVCA admin
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9<br />
6<br />
3<br />
0<br />
-3<br />
-6<br />
-9<br />
-12<br />
-15<br />
22549-d-092308<br />
III. Challenges <strong>and</strong> opportunities<br />
<strong>Brazil</strong> entered the global recession very late <strong>and</strong><br />
bounced back quickly.<br />
Activity exp<strong>and</strong>ed until 1H11 <strong>and</strong> is now slow<strong>in</strong>g down<br />
ow<strong>in</strong>g mostly to previous monetary <strong>and</strong> credit tighten<strong>in</strong>g.<br />
There are structural deficiencies that play an important<br />
role <strong>in</strong> <strong>Brazil</strong>’s bus<strong>in</strong>ess cycles over the long haul:<br />
lack of credit <strong>and</strong> <strong>in</strong>dustry fragmentation<br />
modest <strong>in</strong>vestment spend<strong>in</strong>g<br />
high asset price volatility<br />
Real wage ga<strong>in</strong>s x unemployment <strong>in</strong> <strong>Brazil</strong><br />
% 3-m/3-m oya<br />
-18<br />
2004 2005 2006 2007 2008 2009 2010 2011<br />
Source: IBGE.<br />
% of labor force<br />
Avg. real earn<strong>in</strong>gs (left) Unemployment (right)<br />
14<br />
13<br />
12<br />
11<br />
10<br />
9<br />
8<br />
7<br />
6<br />
5<br />
25<br />
20<br />
15<br />
10<br />
5<br />
0<br />
% 3-m/3-m oya % 3-m/3-m oya<br />
-5<br />
2004 2005 2006 2007 2008 2009 2010 2011<br />
Source: IBGE.<br />
Real retail sales <strong>and</strong> credit <strong>in</strong> <strong>Brazil</strong><br />
Broad retail Credit outstad<strong>in</strong>g<br />
UPC & bus<strong>in</strong>ess confidence <strong>in</strong> the <strong>Brazil</strong>ian <strong>in</strong>dustry<br />
90<br />
85<br />
80<br />
75<br />
% of total Index<br />
UPC<br />
Last = 83.5%<br />
Máx = 86.7%<br />
Avg. 2005-08 = 84.2%<br />
70<br />
2004 2005 2006 2007 2008 2009 2010 2011<br />
Plant capacity (left) Bus<strong>in</strong>ess confidence (right)<br />
Note(*): UPC st<strong>and</strong>s for utilization of plant capacity.<br />
Source: Fundação Getulio Vargas.<br />
25<br />
20<br />
15<br />
10<br />
5<br />
0<br />
90<br />
80<br />
70<br />
60<br />
50<br />
-5<br />
130<br />
120<br />
110<br />
100<br />
29
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