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By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – Despite the weak economy, rising inflation and the forecast of a zero or negative GDP in 2015, foreign companies have continued to show interest in investing in Brazil, especially in sectors which have traditionally been controlled by the government, such as health and infrastructure.

Foreign investments in the public health sector may help clinics like this one in Piaui state to be concluded, Rio de Janeiro, Brazil News
Foreign investments in the public health sector may help clinics like this one in Piaui state to be concluded, photo by Almanaque Lusofonista/Wikimedia Creative Commons License.

A recent study conducted by KPMG shows that Brazil is one of the main destinations for U.S. investments this year. “The study shows that 22 percent of companies surveyed stated that they intend to invest in the country,” says Augusto Sales, partner in the strategy area at KPMG Brazil.

“Many investors are planning to invest in the long-term which should maintain the Brazilian market strong and the country in the limelight during the next few years.” According to KPMG, Brazil only lost to China as the emerging economy which most received U.S. capital last year.

Analysts say, however, foreign investments inflows will not only come from our neighbors up North. Companies from far away as China and Spain, and industries as different as construction and health or education have been flirting with the idea of investing in the huge Brazilian market.

Fernando Santiago, a lawyer at Chenut Oliveira Santiago, has opened an office in Paris, France, to help foreign European companies interested to enter the Brazilian market. The sector of health, according to Santiago, is one of the most promising in Brazil’s economy.

Although the sector is primarily the responsibility of the state, the public sphere has not been able to offer its citizens a satisfactory service, according to Santiago. The Brazilian consumer, says the executive, is forced to look for an alternative in the private sector, and that is where the opportunities for foreign companies are. “It is a basic service, consumed by all, and the market demand equals practically the entire Brazilian population,” he adds.

SUS hospital in Brasília, Rio de Janeiro, Brazil News
The SUS hospital in Brasília, photo by Antonio Cruz/ABr.

“I know of companies in the sector which are investigating the Brazilian market at this very moment,” says Santiago adding that foreign investments in the health market, with the exception of the pharmaceuticals industry, is still scarce, which makes its potential even greater.

With the alteration in legislation in January 2015 which authorizes foreign investments in the health area, including hospitals and clinics, Santiago says the sector should receive even more attention from foreign companies.

“The alteration in the legislation will allow for the inflow of new investments and a renewal of a sector which is stagnant in Brazil. A little oxygen in the sector is very welcomed.”

According to UNCTAD’s (United Nations Conference on Trade and Development) Global Investment Trends Monitor although FDI flows to Brazil were said to have decreased by four percent in 2014, there was a significant increase of cross-border mergers and acquisitions of 45 percent, or US$14 billion.

Overall FDI flows to Brazil totaled US$62 billion in 2014 and despite a four percent decrease from the previous year, the country moved up two positions and now is the fifth destination for these types of investments in the world, only behind China, Hong Kong (China), the United States and Singapore.

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