Brazil’s biggest challenge is overcoming infrastructure bottle necks says Jefferson Michaelis

Jan. 18, 2011 - PRLog -- "After 15 years in the United States, I decided to accept the challenge to temporarily return to Brazil for a special assignment. What I'm experiencing here is that many important improvements have been made by the public and private sectors; however I still see a great number of damaged roads, ports with the same size they had during the 1980s, and is visible that only fewer kilometers of railways were built in the past years, so more than never Brazil is open for international business" Michaelis declared during one of the most important international symposiums in the country.

My job is to assist American companies to invest in Brazil, and vice versa, therefore I’ve to be very clear when working on international strategies. I’m sorry, but what I’m disclosing today is the real (2011) portrait of Brazil, says Mr. Jefferson Michaelis, President of the Brazil-Tampa Bay Chamber of Commerce. “Don’t get me wrong, Brazil offers an amazing opportunity for international companies to profit high returns thanks to these many challenges that the country has to overcome by 2013”, Michaelis commented.

“For instance, if the economy keeps growing in this pace: around 4 to 5% per year, we will have enormous difficulties both internally (domestic market), and with international trade as well,” Michaelis noted.

While the world watches Brazil in its preparation to host the 2014 World Cup, the country’s problems extend beyond getting ready to host this important international event. "See for instance what is happening in Rio right now, look at the amount of solutions they need right now to deal, and to try to avoid future tragedies", a speaker from Argentina said.  

Another important area to pay attention is how Brazil is handling its cargo: About 60% of the country’s cargo is transported via highways, not railway like we have in the United States. Brazil needs an investment of more than R$180 billion (US$108.43 billion) in construction and upgrades so they can handle the flow of traffic. (source: IPEA).

The situation could be even worse if the government hadn’t transferred ownership of 858 kilometers (536.25 miles) of highways to the private sector, which turned them into toll roads, during the second half of the 1990s, according to the study. In most parts of Brazil, tolls are a rip off if compared with the tariffs in the United States. A real case is a short trip from Campinas to Sao Paulo (picture above) can cost drivers about R$13 reais in tolls.

Economic growth = 50% of the largest airports operating over capacity

Air transportation is another sector that needs to be addressed, Michaelis said. Ten of the country’s 20 largest airports already are operating over capacity, and six others are very close to their limit, consequently long delays are very common in most Brazilian airports.

“Economic growth of the C class has incorporated into the air sector thousands of new customers who hadn’t used that kind of transport before, so newcomers like Azul linhas aereas (Jet Blue in the United States) is utilizing  as its hub the Viracopos airport in Campinas, and is experiencing an unbelievable (fast) growth in Brazil. ” there are lots of problems out here, but the country still offers amazing profitable open opportunities for entrepreneurs like David Neeleman who are willing to take the risk, and provide solutions to solve such challenges, completed Mr. Jefferson Michaelis.

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The Brazil-Tampa Bay Chamber of Commerce, BTCC, is a not-for-profit organization. BTCC has emerged as one of the most dynamic bilateral business catalysts in the nation in recent years.