Brazil Infrastructure Report Q3 2010: New research report available at Fast Market Research

New Construction research report from Business Monitor International is now available from Fast Market Research
 
June 28, 2010 - PRLog -- Brazil's construction industry real growth for 2009 was worse than BMI had initially anticipated - construction industry value contracted by 6.26% year-on-year (y-o-y) to reach BRL137.4bn (US$68.83bn) compared to our estimate of -1.5%.

Brazil's construction industry is a dichotomy. There is substantial potential for real growth in value to take off rapidly over coming years, as the country is due to host two of the most high profile sporting events over the next decade - the 2014 World Cup and the 2018 Olympics. However, there are fundamental structural risks which have thwarted investment, and could continue to stymie industry value growth.

Opportunities for growth in Brazil have led BMI to be optimistic for potential industry growth, which we believe will average 6.7% per year between 2010 and 2014, with 7.65% growth forecast for 2010. Over the course of 2009, BMI warned of the impact of private investment drying up in Brazil's construction industry, as it has historically accounted for a high portion of infrastructure investment. It appears government attempts to cushion the blow have been less successful than originally indicated.

This can be traced to the underperformance of the PAC (growth acceleration programme). Planned to funnel BRL642bn (US$353bn) into the construction industry. The government had repeatedly expressed commitment to the plan, and had indicated all was going smoothly. However, data from the Federal government, cited by the Financial Times (FT), show that by the end of 2009 (and 75% of the way through the PAC), just BRL257bn (US$141bn) worth of projects had been completed, or 11% of the 13,330 individual projects listed. This indicates that the plan will fall short of expectations. The PAC not only envisaged public funding, but also a large portion of private investment. The absence of this has also hit investment plans hard.

The failure of the PAC to live up to expectations can be attributed in part to the financial crisis, which rocked Brazil's export led economy, but also to fundamental constraints in the country's business environment. High levels of bureaucracy have slowed the flow of funding and project tenders. A shortage of skilled labour has hindered the progress of projects. Further, a tax structure in need of reform has stymied investment. There is also more the government could do to promote private investment in infrastructure. Since the first public private partnership (PPP) in 2006, Brazil has moved forward at a less rapid rate with privatising infrastructure than some of its regional counterparts - like Chile - and in turn its regulations and legislation has suffered.

Despite the fundamental barriers, there is great potential for future investment in infrastructure, the World Cup and Olympics have created a buzz around Brazil's infrastructure sector. Concerns raised by FIFA about the progress of building stadia, should hopefully kick start the country into action, as we believe the event is too much of a badge of honour to be allowed to fall short of expectations. In South Africa, the World Cup preparations drove construction industry growth into double digits over the past five years - this could potentially happen in Brazil.

Implementing the BRL959bn (US$534bn) PAC II, announced in March 2010, will be a major part of realising this potential; however, if the first PAC is anything to go by, it could fall far short. There is added impetus to realise investments this time around, with the sporting events requiring better transport and a secure electricity supply. However, the 2010 elections to be held in October, present further risks, if the current party does not retain power, then the plans for the PAC II are in jeopardy. A more fiscally cautious attitude to spending could limit public funding for infrastructure, and the private sector will be required to step up to the mark to fill the gap. In order to ensure this, Brazil needs to continue to reform its business environment.

For more information or to purchase this report, go to:
-  http://www.fastmr.com/prod/71139_brazil_infrastructure_re...

Partial Table of Contents:

Executive Summary
SWOT Analysis
- Brazil Infrastructure SWOT
- Brazil Infrastructure Project Finance SWOT
- Brazil Economic SWOT
- Brazil Political SWOT
Market Overview
- Brazil
Industry Forecast Scenario
- Table: Economic and Construction Data
- Construction and Infrastructure Forecast Scenario
Transport Infrastructure
- Table: Transport Industry Data
- Transport Infrastructure Forecast Scenario
- Transport Infrastructure Overview
- Airports
- Roads
- Ports
- Rail
- Major Projects - New and Ongoing Projects
- Airports
- Ports And Waterways
- Road Networks
- Rail Networks
- Major Projects Table - Transport
- Table: Major Infrastructure Projects - Transport
Energy and Utilities Infrastructure
- Table: Energy & Utilities Data
- Energy and Utilities Infrastructure Forecast Scenario
- Energy and Utilities Infrastructure Overview
- Major Projects - New and Ongoing Projects
- Power Plants And Transmission Grids
- Pipelines
- Water Projects
- Major Projects Table - Energy and Utilities
- Table: Major Infrastructure Projects - Energy & Utilities
Business Environment
- Brazil Business Environment
- Limits Of Potential Returns
- Risks To Realisation Of Potential Returns
- Regional Overview
- Latin America Business Environment Ratings
- Table: Regional Infrastructure Business Environment Ratings
Project Finance Ratings
- Brazil Project Finance Ratings
- Design and Construction
- Commissioning and Operating
- Overall Project Finance Rating
- Regional Overview
- Project Finance Ratings: Outlook For Latin America
- Table: Design and Construction Rating
- Table: Commissioning and Operating Rating
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Full Table of Contents is available at:
-- http://www.fastmr.com/catalog/product.aspx?productid=7113...

About Business Monitor International

Business Monitor International (BMI) offers a comprehensive range of products and services designed to help senior executives, analysts and researchers assess and better manage operating risks, and exploit business opportunities, across 175 markets.  BMI offers three main areas of expertise: Country Risk BMI's country risk and macroeconomic forecast portfolio includes weekly financial market reports, monthly regional Monitors, and in-depth quarterly Business Forecast Reports.  Industry Analysis BMI covers a total of 17 industry verticals through a portfolio of services, including in-depth quarterly Country Forecast Reports.  View more research from Business Monitor International at http://www.fastmr.com/catalog/publishers.aspx?pubid=1010

About Fast Market Research

Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available.

For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156.
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