1. Brazil
2013will be an important year for Brazil. Since
taking office in January 2011, President
Dilma Rousseff has seen economic growth contract
by almost 5% during her first year and dwindle to
around 1% in 2012. High business costs and taxes,
indebted consumers, low levels of trade, a tight labor
market and devaluation of the Brazilian real have
combined to create the “Brazil cost,” pushing prices
of Brazilian goods higher than those produced by the
country’s Latin American neighbors.
Rousseff wants to turn Brazil’s fortunes around, and
her economic mission is to push GDP to 4% in 2013.
To achieve her goal, investment will need to rise by
25% to match the investment-to-GDP ratio acheived
by neighbors like Chile and Peru, all of which grew
more than 4% last year. With an economy worth $2.5
trillion, the country brought in over $65 billion in for-
eign direct investment in 2012.
Innovation is widely seen as key to Brazil’s poten-
tial success, harnessing the nation’s creativity to shift
its commodity-based past into a competitive and
technology-driven future. Last August, the president
unveiled plans to spend $66 billion on infrastructure
over the next 25 years, with more than half invested
in the next five to get the country moving. Significant
cuts in interest rates will help fuel credit, and tight fiscal
policy has kept public debt and deficits under control.
The upcoming 2014 FIFA World Cup Brazil and the
2016 Olympic Summer Games in Rio de Janeiro,
the nation’s art and culture capital, have prompted
a regeneration boom in the city. The Rio Negócios
Web portal, created by Hélio Viana, president of
World Sport Business and Júlio Bueno, Secretary
of Economic Development, is an online marketplace
set up to ensure that homegrown businesses supply
global events and earn a share of the spending.
Due to a 250% increase in social spending on key
areas like health and education during the last 15 years,
40 million people escaped poverty in Brazil during the
lastdecade.Recentreductionsinpowerprices,coupled
with record-low unemployment, are giving businesses
and consumers renewed cause for optimism. If Rous-
seff’s policies pay off in 2013, this promises to be anano
maravilhoso or “wonderful year” for Brazil.
PROMOTION // ECONOMIC DEVELOPMENT
Betting on Innovation and Investment in Technology
ReinaldoCóser
The new Petrobras headquarters in central Rio was built by WTorre, which has also preserved more than 20 historical buildings in the city.

2. PROMOTION 2 // ECONOMIC DEVELOPMENT
T
here are two types of successful businesses. There
are companies that study the marketplace, identify
opportunities and deliver something better than
what is already available. And there are those that
go against the flow, strike out in new directions and
release revolutionary products and services consumers never
dreamed of, but suddenly find they need.
Brazil has both types. But three local companies, doing
business in different sectors, exemplify the latter approach:
building neighborhoods of the future, unearthing deposits of
rare metals and even discovering a treatment for cancer by
applying avant-garde methodology and unswerving vision.
“Our slogan is ‘undertake to amaze,’” says Walter Torre,
chairman and founder of WTorre. “We are an innovative com-
pany in every segment: civil construction, basic infrastructure,
shopping malls and hotel chains. In the last 30 years, we
amazed the market with unimaginable projects, like the ship-
yard in Rio Grande do Sul, the biggest dry dock in the southern
hemisphere. We are helping the country flourish.”
Since 1981, WTorre has built a portfolio of over 220 projects,
comprising 5 million square meters, at home and abroad. But,
as Torre notes, that’s just a fraction of what is needed to satisfy
a market that, due to strong economic growth over the last
decade, now has 50 million new consumers.
While conducting research into developing shopping malls,
Torre surveyed cities growing faster than the national average
and says he was surprised to find more than 75 new agricul-
tural, mining and distribution hubs that were expanding twice
as fast as Brazil as a whole.
That potential gives the company the confidence to invest in
large legacy projects that will outlive the current Olympic boom,
including an offshore port at São Vicente in São Paulo state. It
aims to complete that initiative ahead of schedule in two and a
half years, in addition to opening a new private airport.
WTorre is also in talks with Walmart and Intel about “building
neighborhoods where there is a connection among commu-
nity, work and leisure,” Torre says. “It seems obvious, but does
not exist in Brazil. We are trying to build a futuristic neighbor-
hood, which is not classified by social class or wealth but by
cultural level.”
At 81 years old, Olacyr de Moraes is one of Brazil’s best-
known businessmen. He gained the moniker “King of Soy” after
he cultivated the world’s biggest soybean empire. Moraes is
now majority shareholder of Itaoeste Serviços e Participações
Ltda, a mineral research and development company, which in
2011 discovered a deposit of the rare metal thallium that will
help supply global demand for six years.
“I have always been an innovator, from power production
to agriculture, and thrived in all of them,” Moraes says. “I had
a bank, but I sold it and invested in rail tracks and soy pro-
duction, which I had no knowledge of. This pioneering cost
me dearly, but it gave me a feeling of fulfillment, and I am
very happy I pursued it. The country profited from my entre-
preneurism.”
Itaoeste is now benefiting from his experience as it focuses
on scarce commodities such as cobalt, titanium, gold and
other ores in São Paulo, Piauí and Bahia.
“In the mining business, there is obviously a component of
luck,” Moraes says. “But we did very meticulous research. We
sell small portions of very rare, valuable materials with huge
added value, and it works well for us.”
Founded in 1936, União Química is one of Brazil’s biggest
pharmaceutical companies. Its three state-of-the-art factories
and 2,000 employees manufacture 570 successful products,
marketed with 400 brands, in the contraceptive, animal health,
over-the-counter and ophthalmology segments. With 600 rep-
resentatives distributing its drugs via 98% of Brazilian outlets,
União Química is ranked 10th nationwide in unit sales.
Recently, União Química discovered an anticoagulant that
proved very effective in the treatment of melanoma, as well as
pancreatic, lung and kidney cancer metastasis. The company
hopes to fast-track clinical approvals and have the product on
the market in three years.
The global pharmaceuticals market is worth $25 billion and
growing by 4.8% a year, but in Brazil it is expanding by 25%
annually. União Química is uniquely positioned to profit from
that growth, and already works in tandem with global giants
like Novartis and Laboratoires Théa. It is now looking to forge
new alliances.
“We are after partnerships with technological companies
that aren’t globalized, to bring innovation to Brazil,” says
Chairman Fernando Castro Marques.
An Avant-Garde Approach to Business
Laboratory technicians at União Química, one of Brazil’s largest
pharmaceutical companies

4. PROMOTION 4 // ECONOMIC DEVELOPMENT
From Ideas
to Reality
I
n 1972, Andreas Pavel, a German-
Brazilian, created a portable cas-
sette player, dubbed the “Stereobelt,”
which he said at the time would “add a
soundtrack to real life.” As he shopped
his invention to financial executives,
many felt that no one would want to wear
headphones in public, and rebuffed his
efforts to mass-produce the device.
Then, in 1979, Sony launched the Walk-
man, and the rest is music history.
That ahead-of-its-time thinking is typi-
cal of Brazilians, who have a history of
inventing ingenious solutions to life’s little
problems, even if sales have not always
matched the scope of their imaginations.
Today, however, some of Brazil’s most
innovative companies are developing
intelligent answers for bigger questions
at the right time and in the right place to
convert creativity into success.
Brazil began to privatize its ports in
2007, and a year later, as the global
financial crisis loomed, Adalberto
Sedlacek, the chairman of Grupo Poly,
saw his chance: “I figured it was the right
time,” he says. “I always learned that cri-
sis is the perfect period to grow. That’s
when opportunity arises.”
Sedlacek’s background in overseas
trade meant he had experienced first-
hand the shortcomings of Brazil’s
existing infrastructure and, given con-
tinued growth, saw a bottleneck coming
when facilities would stop handling the
volume of imports and exports. Thus he
gathered a group of investors to acquire
Itajaí Port in the state of Santa Catarina,
and began to transform its installations
and operations into what would become
Poly Terminais.
“After one month, work began,” Sed-
lacek recalls. “It’s been four years since
we started with more than 480,000
square feet, and now there are over
1 million. We still have two more expan-
sions to do. Once it opened, I filled the
terminal in just eight months.”
Poly Terminais now has one of the three
bonded warehouses in the state and an
impressive client portfolio, including
global tire giants such as Goodyear and
Bridgestone. Currently 30% of Poly’s
clients are international, but Sedlacek
expects that number to grow signifi-
cantly in coming years.
His goals are vertical integration,
increasing efficiency and reducing time
and costs.
“We are working on this new one-stop-
shop system, everything the customer
needs,” Sedlacek says. “He just has to
say where he wants to take it. I’ll get it
from the production plant, deliver to his
distribution center, and do international
logistics, national logistics and distribu-
tion.Heneedstotakecareofhisbusiness.
The rest will be my responsibility.”
To decrease customers’ expenses,
Poly Terminais uses X-ray technologies
to advance container inspection and
ensure that goods move as quickly as
possible.
But Sedlacek’s ambitions go beyond
Brazil’s borders. He is exploring oppor-
tunities offered by Mercosur to invest in
three ships, each able to transport 2,000
containers. These will travel between
São Paulo, Paraná, Pernambuco, Rio
Grande do Sul and Santa Catarina, and
on to Uruguay, Argentina and Paraguay.
And he is also working on a cabotage
deal to Manaus, capital of Brazil’s larg-
est (and landlocked) state, Amazonas.
Realizing a vision
Fluxo Integrated Solutions was estab-
lished in 1970 to provide Brazil’s nascent
petrochemicals industry in northeastern
Poly Terminais in Itajaí, Santa Catarina

5. PROMOTION 5
Bahia with innovative products, first in
the south and then overseas as demand
developed in the 1980s and 1990s. In
2012, it had sales of $150 million, 33%
of which was profit, and it aims to reach
$90 million in profits by 2016.
According to Hideo Hama, Fluxo’s
chairman and founding partner, the
company’s vision and agility enabled
it to introduce cutting-edge technol-
ogy, such as radar tank-inventory
control. It pioneered Swedish-made,
real-time stock calculation via satel-
lite and invented a proprietary digital
valve system that most companies in
the domestic oil industry use today to
automate processes.
Cutting red tape
Established in 1979, Sodré Santoro
is South America’s biggest auction
house, putting everything from cars to
real estate on the block. If its founder
and chairman, Luiz Sodré Santoro,
gets his way, soon it will add signing
soccer players to that list. In what is not
so much a rags-to-riches as a scrap-
to-soccer-stars story, Sodré Santoro
started off selling scrap metal, realiz-
ing double the market price, and then
got into auto auctions. Today, he sells
about 80,000 cars a year.
With the 2014 FIFA World Cup Bra-
zil coming to Rio de Janeiro, Sodré
Santoro’s attention has turned to the
lucrative soccer market, for which he
believes auctions are the best way to
cut out middlemen and allow foreign
clubs to sign players directly.
“I found it was difficult to negoti-
ate abroad, especially because of the
requests to pay extra on the side. What
we need is to get straight to the final
client,” he says.
Pátio Guarulhos in São Paulo, where Sodré
Santoro is currently storing 17,000 vehicles

6. PROMOTION 6 // ECONOMIC DEVELOPMENT
A
ccordingtogovernmentdata,Bra-
zil’sfinancialsectorencompasses
more than 2,300 institutions,
including 150 banks with total assets in
excess of $1.78 trillion. Subject to strict
standards, Brazil’s banks emerged
from the global financial crisis relatively
unharmed, and credit rose by almost
40% in the two years after September
2008. In such a competitive environ-
ment, just being in the marketplace is not
enough. Smaller players need to carve
out niches to survive and grow.
TMG Capital provides consultancy
services to international private equity
funds interested in investing in Brazil.
Its CEO and president, Luiz Francisco
Novelli Viana, had a successful track
record of resuscitating businesses
before starting his own company, which
occurred soon after Brazil’s Plano Real
(Real Plan) economic program con-
quered hyperinflation in the mid-1990s.
“We were probably among the three pio-
neers in private equity in Brazil,” he says.
TMG Capital’s first fund focused on
small and medium-size companies
created during the era of hyperinfla-
tion, when the marketplace was highly
fragmented. Cash was flowing and
shareholders profited, but businesses
became inefficient and uncompetitive.
TMG’s innovative approach revolution-
ized the Brazilian dental care sector, due
toinvestmentintechnology,management
and strategies, and TMG grew even more
when it took one of its companies public.
It has since created two other funds
that invest in emerging markets, and it
now has a portfolio worth $400 mil-
lion. Among its investments is BoaVista
Serviços, a credit bureau that tracks
the spending habits of 90% of Brazil’s
200 million people. Using state-of-the-
art algorithms and cloud computing,
it compiles data from 2,200 points,
allowing BoaVista to offer personalized
financial packages to fuel consumption.
“The predictability of credit behavior is
important for innovation,” Viana says.
Founded in 2009, Banco Gerador
initially focused on Brazil’s booming
northeastern region, where the econ-
omy is growing at the same speed as
China’s and has a unique business cul-
ture. The bank adopted an unorthodox
approach to segmentation, initially offer-
ing affordable banking to low-income
individuals through “financial shops,”
before it started working with global
consultancy firms on high-level mergers
and acquisitions and IPOs.
Luiz Francisco Novelli Viana, CEO and
president of TMG Capital
Smaller Players Think Big

7. ECONOMIC DEVELOPMENT // PROMOTION 7
T
he Brazilian Association of
Technology for Equipment and
Maintenance estimates that while
Brazil accounts for just 4% of the global
equipment market, it represents 40% of
the Latin American market. Machinery
for the civil engineering and construc-
tion industries accounts for more than
three-quarters of the national market.
This is good news for Brasil Máquinas
deConstrução(BMC),establishedin2007
to distribute high-quality machinery from
companies like South Korea’s Hyundai
Heavy Industries. Facing stiff competi-
tion from established brands, BMC has
become the domestic market leader
and the world’s number one distributor
of Hyundai products in just five years. It
recently invested $150 million in a factory
to build Hyundai machinery in Brazil.
Bullish about prospects in the current
climate, BMC’s chairman, Felipe Cava-
lieri, has also invested in new ventures
in mining, finance and construction, and
recently bought 50% of a consulting firm
that specializes in external trade.
“We use our capacity and know-how
to build projects,” he says. “Brazil has
a habit of importing. We want to export
and know our client, too. The objective
is to reach $3 billion in exports by 2015.”
Sóllitta Grupo is another diversified
player with an ambitious growth strat-
egy. Founded two decades ago, the
organization concentrates its efforts
on the development of innovative prod-
ucts for niche markets. A group of five
companies, it is active in high-density
polyvinyl chloride (PVC) piping, anti-
corrosion treatments for steel tubes,
fuel pump and tank installation, and fuel
distribution safety inspections under the
Ecotest brand.
According to Sóllitta’s chairman
Roberto Gadotti, the company is grow-
ing quickly and looking for partners to
help develop new technology solutions.
By 2014, its new factory will begin serv-
ing the offshore oil industry, and in the
next five years, it plans to roll out Ecotest
nationwide.
Construction Boom Helps Build Business
One of BMC’s distribution points
Roberto Gadotti, chairman of Sóllitta Grupo

8. PROMOTION 8 // ECONOMIC DEVELOPMENT
S
ince the 1950s, Brazil’s economic
ups and downs have resembled
a roller coaster. Conducting busi-
ness in the country, let alone becoming
successful, has been tough. Despite
these difficult conditions, three home-
grown companies, with at least half a
century’s history each under their belts,
have not only survived—but prospered.
Agrale, the sole national tractor manu-
facturer to plow its way through Brazil’s
recent economic troughs, celebrated
its 50th anniversary last year. Founded
in 1962, Agrale first made two-wheeled
tractors, and later diversified with
commercial vehicles, buses and four-
wheel-drive vehicles, as well as motors
and generators under its Lintec brand.
When Hugo Zattera became chairman
in 1995, Agrale took over chassis manu-
facturing for Marcopolo’s Volare buses,
and it has made 45,000 units since 1996.
In 1998, it began building trucks for
Navistar International, a manufacturer
and marketer based in the United States,
for whom it now handles all production.
With annual sales of more than $1 bil-
lion, Agrale sells across Brazil and in
10 other nations in South America, the
Caribbean and Africa.
“Agrale is a serious, competitive and
innovative company,” Zattera says. “We
always reached new markets before
competitors. When some only saw
difficulties, we saw opportunities and
focused on our goals.”
Zattera notes that Agrale strives to
“always insert some degree of innova-
tion” into its products, like the company’s
natural gas vehicle, 400 units of which
circle the streets of Lima, Peru, and its
deal with Siemens, the German engi-
neering and manufacturing company,
to develop a hybrid bus.
“To make growth viable, we need to
maintain our former markets,” Zattera
says. “This is our strategy, and we fore-
see growth of just over 20% next year.”
The family-owned Brennand Group
started 80 years ago as a sugar and
alcohol producer before diversifying
into cement, ceramic and glass. In 2000,
it established an energy business that
focused on small hydroelectric power
Established Names, New Directions
TMG is a pioneering and independent Brazilian Private Equity
Please visit us at tmg.com.br
Strategyand
Management
Business Building
SINCE 1997
Hugo Zattera, chairman of Agrale
MarcosRiboli

9. ECONOMIC DEVELOPMENT // PROMOTION 9
stations. Brennand Energia reached a
total capacity of 356MW by the end of
last year, and is aiming for 600MW by
2015 with new hydro and wind power
plants.
What’s more, the group’s founder has
interests beyond business. In 2002,
Ricardo Brennand, a collector of histori-
cal objects and art, opened the Ricardo
Brennand Institute in Recife, which con-
sists of a museum, art gallery, library
and park, and had a clear goal in mind.
“We built it with the purpose of bringing
education to the population, especially
the poor,” he says.
His daughter Lourdes Brennand
echoes his sentiments. “My father has
always given much importance to edu-
cation,” she says. “So this has been his
contribution, to share knowledge.”
Founded in 1951 by José Carlos da
Silva Jr., now its chairman, São Braz
manufactures over 200 food and bever-
age products, including one of northeast
Brazil’s most popular coffee brands. In
addition to producing corn and coffee
beans,SãoBrazhasbranchedintomedia
and cars, with two TV channels, a radio
station, a newspaper and regional auto
dealerships.
“With competition, you can only suc-
ceed if you have superior quality and are
bold enough to cover all regions, attend
to consumer needs, recognize habits
and develop products that adjust to that
reality,” Silva Jr. says. “We are buying
new land to extend the products we pro-
duce and take advantage of our capital.
The fact that we are a traditional com-
pany gives us credibility; we have had
possibilities to grow, and that is what we
have accomplished.”
+ 55 47 3631 5000
tuper@tuper.com.br
www.tuper.com.br
FROM BRAZIL TO THE WORLD
TRANSFORMING
STEEL WITH THE
LATEST TECHNOLOGY
AND THE HIGHEST
QUALITY
· 41 years of experience
· Brazil’s 5th largest steel processor
· More than 30 market segments
served - Automotive, Construction,
Oil and Gas, Mining, Energy,
Sugarcane-Energy, Agricultural
Implements and Machinery, among
others
· More than 1,248,613 square feet of
constructed industrial area
MAIN PRODUCTS
Structural Steel Tubes and Conduction
Pipes, Electrical Conduits, Structural
Profiles, Steel Roofing, Scaffolding
Systems, Steel Props, Construction
Systems, Automotive Parts and
Components, Exhaust Systems for OEM
and Aftermarket.
The Brennand Institute in Recife features a
collection of historical objects.
Ensuring That
Brazil Stays
in School
L
ast October, the lower house of
Brazil’s Congress approved the
National Education Plan, which
will dedicate 10% of GDP to educa-
tion by 2020. If the Senate passes it,
it will propel Brazil to number one in
education spending worldwide.
Brazil is making a serious effort to
develop a knowledge-based society.
Currently, its literacy, numeracy and
scientific knowledge rates lag behind
those of its rivals in the global market-
place, and only 11% of its people hold
a college degree. But private universi-
ties are booming, representing 75% of
Brazil’s 2,400 higher education institu-
tions, and the government is working
with them to offer subsidized places
for students.
An island of Portuguese speakers in
a mostly Spanish-speaking continent,
Brazil has traditionally favored English
as a second language.
Brasas, a Brazilian company estab-
lished in 1967, is a pioneer in language
education in the country and now
offers in-depth English courses in more
than 50 locations across the nation.
Family-owned Brasas says that it can
help anyone, from eight-year olds to
adults, to learn English in 18 months
due to its high-quality teaching staff
and its unique methodology.
While 70% of its students are profes-
sionals seeking to further their careers,
20% are children whose parents want
an English education for them.
The company also works with corpo-
rations such as oil giant Petrobras to
help hundreds of executives communi-
cate with their overseas counterparts.
“We are very concerned about
quality and the product we sell to the
students,” says Brasas director Peter
George O’Donnell. “People look to us
for our quality and speed; that is what
inspires them to choose us over the
competition.”
ViníciusLinsLubambo

10. PROMOTION 10 // ECONOMIC DEVELOPMENT
Value-Added
Innovation
A
ccording to the Merriam-Webster
dictionary definition, innova-
tion means “the introduction of
something new: an idea, a method, or a
device.” But there’s another form of inno-
vation, which involves using an existing
idea, process or tool in a new or improved
way. Let’s call it “Brazinnovation.”
Three Brazilian companies located in
Santa Catarina, Rio de Janeiro and Rio
Grande do Sul have adopted processes
and adapted products already avail-
able in the marketplace, adding value
with the unique quality of Brazinnova-
tion. They now manufacture and market
proprietary brands of footwear, vehicle
exhausts and tubing, and plastic film and
laminates, sold both across the country
and around the world.
Twin brothers Alexandre and Pedro
Grendene established their eponymous
company in 1971 as a family business
whentheyopenedafactoryinRioGrande
do Sul. At first they manufactured plas-
tic baskets for wine bottles, which were
previously wrapped in wicker. Then they
started to produce plastic components
for agricultural machinery, before diver-
sifying into nylon soles and heels for
other manufacturers’ shoes.
In 1978, they made their first pair of
plastic, injection-molded sandals, an
enterprise that led to the production of
thousands and eventually millions more
shoes. While Grendene did not invent
the technology it still uses to produce
180 million pairs of shoes, boots, san-
dals and flip-flops every year, which
generate about $900 million in revenue,
the company is a pioneer in the all-
plastic footwear industry.
“We started experimenting with mate-
rials to make them lighter and began to
imagine that would be possible to insert
air during injection,” Alexandre Grendene
says. “At first we could reduce the weight
by half. Currently, the technology is so
advanced that we can reduce the weight
of the material by five times. It was this
technological development that enabled
the manufacturing of our ‘Rider’ sandals.”
Still sold today, Riders are available
in various colors and styles, and is
just one brand in an extensive range of
men’s, women’s and children’s models.
Grendene’s “Melissa” range for women,
introduced in 1979 and inspired by the
sandals of French fishermen, also con-
tinues to rank among the company’s
most popular products. But that success
spawned cheap imitators and forced the
company to find creative ways to main-
tain market share.
“Our Melissas started being copied
worldwide,” Alexandre Grendene says.
“So we began to innovate in marketing,
advertising on Globo TV. They did not
know how to do merchandising of shoes
during soap operas. We taught them. We
started to bring French couturiers to cat-
walk shows in Brazil when nobody had
done that. We were concerned about
creating a sustainable brand. Our mar-
keting strategy worked.”
Today, collaborations with some of
the world’s most sought-after design-
ers, such as Vivienne Westwood and
Karl Lagerfeld, and tie-ins with famous
brands like Liberty Art Fabrics and the
Muppets, keep the brand fresh, and
Melissa sandals are sold exclusively
in sophisticated boutiques. Last year,
Grendene signed a deal with a Rio-
based retail chain to create dedicated
Melissa stores. The company currently
has 50 outlets, but is aiming for 150 in
the near future.
For now, Brazilian customers buy
three-quarters of the company’s over-
all products, but Grendene exports the
remaining 25% and sells them through
Grendene produces footwear that is sold in 90
countries.

11. ECONOMIC DEVELOPMENT // PROMOTION 11
www.to.gov.br
www..com.br
YourOPPORTUNITY
intheRIGHTPLACE
andTIME
Foundedonly25yearsago,Tocantinsisthenewest
Brazilianstateandalreadyisanexampleofgrowthfor
thecountry.Inadditiontoitsabundantnatural
resources,thestateislocatedincentralBraziland
isstrategicallypositionedforproductionandexport.
Sustainablegrowth
happensthroughstrong
governmentinvestmentin
transportandinfrastructureas
wellasincentivesandcredit
linestobenefitindustrial,
commercialandagricultural
ventures–workingwith
governmentagenciesdedicatedto
thepreservationofnatural
resources.Tocantinsoffersareal
networkofopportunitiesreadyto
connectbigbusinesses.
more than 20,000 points of sale out-
side the country. These include Galeria
Melissa in New York City, with new
concept stores planned to open soon
in London and Shanghai. This is just the
tip of the iceberg, Alexandre Grendene
says, as the company begins to focus
its attention overseas.
“We want to grow abroad,” he adds.
“Here, you can grow, but it’s hard to
double in size quickly. The world is big.
We have always been very competitive
and need to export. We have a motto:
‘few products and huge quantity.’ With-
out a large volume of sales, we would
not have profits. Because of this, we are
focused on very few products and large
productivity. We want our products to
be the same for all countries.”
Reaching new milestones
Vulcan is Brazil’s largest manufac-
turer of plastic film and laminates,
and has been at the forefront of tech-
nological development for more than
six decades. Headquartered in Rio de
Janeiro, with production facilities in São
Paulo, France and the Netherlands, the
company makes a wide array of prod-
ucts under its Con-Tact brand, including
canvas for trucks, automotive uphol-
stery, geomembranes for construction,
and vinyl flooring, as well as pool liners,
home decoration and fashion items,
visual communication and packaging
applications, and adhesive plastics.
Occidental Petroleum owned Vulcan
until 2001, when it was posting annual
profits of about $50 million. In that same
year Grupo Brasil acquired it and since
then the company’s revenue has reached
three times that figure. In mid-2011, it
announced new investments valued at
nearly $160 million over the next five
years. Vulcan plans to open three new
factories in Alagoas to manufacture poly-
vinyl chloride (PVC) products. This would
create as many as 800 new jobs.
According to Jonas Assis, the com-
pany’s chairman, by searching for
inspiration in every market sector, lis-
tening closely to customer needs, and
creating innovative products in its labo-
ratories, Vulcan is constantly pushing
the boundaries of plastics technology.
“We manufacture a mirror that is not
made of glass, but of PVC,” he says. “It
is as good as glass, but lighter, will not
break if dropped, and will not give you
seven years’ bad luck.”
Investing in knowledge
Founded in 1971 to manufacture
aftermarket exhaust systems for
motor vehicles, Tuper has consistently
introduced new lines of business by
leveraging its technical expertise in one
sector to break into another.
“We consider ourselves a technologi-
cal company,” says Frank Bollmann,
“The world is big.
We have always been very competitive and need to export.”
Alexandre Grendene

12. PROMOTION 12 // ECONOMIC DEVELOPMENT
Tuper’s chairman. “To become strong in
technology, it is necessary to form your
own team of technicians. We invest in
people and knowledge. There is a lot of
freedom to create. We make our own
machines and tools, and always have
ongoing projects. This helps us grow
over 20% every year.”
After a decade of making its name
in mufflers, Tuper began produc-
ing welded carbon steel tubes and is
now Brazil’s leading carbon steel tube
manufacturer. Ten years later, Tuper
diversified into steel sheet roofing and
profiles. In 2000, it consolidated its
exhaust business with original equip-
ment manufacturer (OEM) parts for auto
assemblers.
In 2009, Tuper acquired Vanzin Auto-
motive, reinforcing its presence in
aftermarket exhaust systems. As part of
the same deal, it acquired Vanfix Plásti-
cos, which makes 18 million plastic
components every year, and a haulage
firm to handle logistics. The following
year, it began production of galvanized
Developing
Sustainable
Energy
A
s Brazil’s economy has
expanded, demand for energy
has risen. In petroleum and
ethanol production, the nation ranks
third in the Americas, after Venezuela
and the United States. These two fuels
account for almost 40% of consump-
tion,buthydroelectricity,whichprovides
29%, and other renewables—including
biomassfromsugarcane,whichcontrib-
utesover 20%ofthemix—haveseenthe
greatest growth in recent years.
Strong private sector investment in
renewables has produced dividends:
Revenues in 2011 topped $104 bil-
lion, due to an increase of 2.5% per
annum since 2007. According to Edi-
son Lobão, Brazil’s minister of Mines
and Energy, the country will attract
another $235 billion over the next
decade—enough for 36 hydro plants,
12 gigawatts of biomass and 11 giga-
watts of wind power.
Last September, President Dilma
Rousseff introduced tax cuts across
Brazil’s electricity sector to improve
prices for consumers and businesses
while seeking to boost growth.
“The reduction of energy costs
generates a systemic effect, which
will impact the economy as a whole,”
Rousseff says. “It will promote inter-
national competitiveness, reduce
inflation and stimulate investment.”
Founded in 2005, Diferencial Ener-
gia has carved out a niche by selecting
projects carefully, streamlining opera-
tions and calculating risk-to-reward
ratios well. Working with other sup-
pliers, it built an innovative energy
marketing portal that cuts costs, saves
time and streamlines its operations. In
2012, the company turned $60 million
in profit with a workforce of 30 people.
Diferencial Energia is involved in
natural gas and funds biomass proj-
ects using eucalyptus, and constantly
monitors technological advances
and prospective fuel sources to stay
cutting-edge.
As its chairman, Eduardo Lanari
Prado, says, “We have to find value
and an equation that is different from
the competition’s to succeed. As the
market becomes more sophisticated,
we become more sophisticated and
innovative.”
The newly inaugurated Tuper Oil and Gas plant, in São Bento do Sul, Santa Catarina.

13. PROMOTION 13
ESPÍRITO SANTO
TheBrazilianStatewiththebestopportunities
foryoutoinvest,workandlive.
tubes at Latin America’s most advanced
plant and created Tuper Commercial to
handle its sales and distribution.
Last year, Tuper launched another
venture from a new 370,000-square-
foot state-of-the-art factory, which will
manufacture large diameter tubes for
structural applications and the hydro-
carbons industry. The company is
ready to expand operations in the oil
and petroleum industry internationally
with the establishment of a new distri-
bution office in Houston, Texas, and it
has research and development partner-
ships in Germany, Italy, Austria and the
United States.
Throughout its history, the company
has invested in technology, people and
product quality, but Bollmann says the
real secret of Tuper’s success “is to
work, work and work even harder.”
Spotlight on Innovation
Geociclo is a technology-based
company that applies biotechnology
to develop innovative and sustain-
able solutions to increase efficiency.
Although it’s a major world food sup-
plier, Brazil currently imports 70% of
its fertilizers. With an eye to the future,
Geociclo collects readily available
waste and turns it into slow-release
fertilizer pellets to increase agri-
cultural production at a lower cost.
Headed by Olavo Monteiro de Carv-
alho (pictured above), the company is
building the world’s largest “organo-
mineral” fertilizer production plant.
This report is the fifth installment
of a series on Brazil.
For more information, please contact:
Gabriel Guttierrez at g.guttierrez@forbes-cm.com
Brazil project director: Florence Lilti
Project coordinators:
Gavin Thwaites, Eduarda Ribeiro and Rosie Venn

14. PROMOTION 14 // ECONOMIC DEVELOPMENT
B
razilians are notorious for their
flamboyant and fun fashion
choices, from the micro-bikinis
seen on Rio de Janeiro’s beaches to
Ipanema flip-flops, worn almost every-
where and with everything from jeans
and T-shirts, to evening gowns, making
the country’s colorful creations must-
wears in wardrobes worldwide.
The homegrown fashion industry has
also earned the right to strut its stuff on
coveted catwalks, as designers, manu-
facturers and retailers have taken giant
steps to transform Brazil into the world’s
fifth biggest textile producer and fourth
largest manufacturer of finished cloth-
ing. Two major fashion events—São
Paulo Fashion Week (SPFW), Latin
America’s hottest style ticket, and Fash-
ion Rio—define trends for the continent.
Despite global sales of $63 billion in
2011 and internationally known brands
like Issa, Pedro Lourenço and Osklen,
Brazil’s fashion fortunes depend on
the domestic market. According to the
Brazilian Textile and Apparel Industry
Association (ABIT), only 5% of produc-
tion is currently destined for export.
However, one recent arrival to the local
fashion firmament has already started to
explore markets overseas. Founded in
2002, La Estampa produces a dazzling
array of high-quality fabrics, creating
colors and prints used by some of the
country’s leading designers and the
world’sbiggestretailers,includingSpain’s
Inditex, the company behind Zara.
La Estampa explored partnerships
with European brands before finding a
Spanish, family-owned company that
understood its philosophy and wanted
to grow outside Europe. Their partner-
ship has made La Estampa one of the
biggest suppliers for Inditex. La Estampa
also has its sights set on the U.S. market,
where it is looking for partners who share
its DNA.
From showrooms in Rio de Janeiro
and São Paulo, as well as via a national
sales network, La Estampa combines
a talented creative team, personal-
ized service, world-class logistics and
cutting-edge technology to deliver
made-to-measure solutions. The com-
pany now sells 12 million meters of fabric
every year to 1,800 wholesale clients.
“Our competitive advantage is based
on the number of fabrics we sell,” says
Marcelo Castelão, La Estampa’s man-
aging director. “We have more than 150
different types.”
La Estampa is also at the forefront of
digital printing, which has revolutionized
the industry in recent years. Producing
four times as much fabric as cylinder
printing and capable of more detailed
designs, for some time digital printing
remained the sole domain of high-end
brands due to its high cost. But as
chains started to demand its benefits,
Castelão found a supplier working on
the next generation of digital printing.
“With this, we can produce in two and
a half days what used to take a month,”
Castelão says. “We can process an
order with less cost and a smaller envi-
ronment impact.”
With annual growth of 30% to 35%
and ambitious plans to triple revenue by
2016, La Estampa is poised to explode
onto the global stage.
“What we do today is the tip of the ice-
berg compared with what we can do,”
Castelão says. “If we continue investing
in marketing, operations and customer
service, this is just the beginning.”
Retailer TNG is anotherBrazilian fashion
giant that has shown spectacular growth
over the last 25 years, and retains massive
scope for further expansion. Its motto is
Distribute your brand
throughout Brazil?
Yes we can.
55 11 3036 4000
www.brasilmaquinas.com
COMPLETE CONSTRUCTION AND MATERIAL HANDLING SOLUTIONS
Brazil’s Emerging Fashion Market
Gets High Marks for Style

15. PROMOTION 15
TNG is a Brazilian fashion brand that has been in business
for 28 years. Initially TNG marketed primarily to the male
consumer, however in 2000, due to popularity, it started to also
cater to the female customer.
TNG has been increasing its presence considerably on the
Brazilian fashion scene, appearing at ‘Fashion Rio’ as well as
other important events on the national fashion calendar.
Today, TNG has 170 stores and works with 600 retail brands
selling a total of 5 million items each year.
Such numbers makes TNG one of the most important players in
the Brazilian fashion market.
HOW DO YOU SPELL SUCCESS IN FASHION? TNG.
www.tng.com.br
“outsidetheordinary,”anditwasfounded
by CEO Tito Bessa Jr., who dropped out
of college to open his first menswear
store in São Paulo in 1984.
Noticing the women coming to his
stores, Bessa added a women’s line to
TNG’s catalog in 1999 and has show-
cased his collections during Rio’s annual
fashion week since its inaugural edition
in 2002. Women now account for over
a third of total sales of close to $200
million, and in Brazil, TNG’s market pres-
ence rivals that of global chains like H&M
and Zara.
TNG has a national network of 170
shops and operates an e-commerce
site, but research from IBOPE Intelli-
gence estimates that the brand has the
potential to open up to 700 wholly owned
stores and to sell its products through
1,800 multi-brand outlets. Accord-
ing to Bessa, this growth is in addition
to expansion into children’s clothing,
accessories and other segments.
Bessa has already been in talks with
prospective investors about raising
additional capital to take his business
to the next level. TNG has traditionally
opened 10 to 15 stores a year financed
by profits alone. But he says that with
outside investment, “we want to set up
50 to 60 stores per year in the next four
or five years.”
Tito Bessa Jr. and Brazilian actress Isis
Valverde closing the TNG show at Fashion Rio.

16. PROMOTION 16 // ECONOMIC DEVELOPMENT
States of the
Nation
B
razil is the world’s fifth-largest
nation by area. It is divided into 26
states as well as the federal district
and capital, Brasília. The largest states,
Amazonas and Pará, occupy territories
larger than neighboring nations such as
Peru and Colombia, while the six most
populated are each home to at least 10
million residents, with more than 40 mil-
lion calling the state of São Paulo home.
The top six states in terms of popula-
tion—São Paulo, Minas Gerais, Rio de
Janeiro, Bahia, Rio de Grande do Sul
and Paraná—collectively contribute
around two-thirds of Brazil’s total GDP.
Some of the country’s smaller states,
however, are among its fastest-growing,
and as their populations transition to the
middle class, they are boosting both
Brazil’s consumption and its economic
expansion.
Espírito Santo, which lies along Bra-
zil’s southeastern coast, bordered by
Bahia and Minas Gerais to the north and
west and by Rio de Janeiro to the south,
is one of the country’s success stories.
Modestly proportioned and ranking
23rd nationwide by territory, it boasts a
population of about 3.5 million and an
economy that grew 9.2% in 2011, on par
with China’s growth and well above the
national 2.7% increase.
That booming economy was founded
on agriculture, primarily coffee and fruit
processed for juice, but has become
increasingly diversified, expanding into
offshore oil and gas, mining and steel-
making, as well as housing one of Latin
America’s largest ports. Eighty percent
of Brazil’s ornamental rock exports
originate in the state. Espírito Santo is
pushing revenues and federal funds into
road and rail networks, education and
sanitation projects.
The state has also secured close to
$50 billion in investment through 2016
to drive development in hydrocar-
bons, build a new port and support
the burgeoning service sector. “I want
investors to find clarity and transpar-
ency in relationships,” says Espírito
Santo’s governor, Renato Casagrande,
“and good opportunities for business.”
But Casagrande is just as concerned
about ensuring that the state’s progress
continues, and he recently launched
PROEDES, a statewide sustainable
development program focusing on
domestic and global competitiveness.
“I also want people to think of Espírito
Santo for its quality of life,” he says.
“Our development has to be sustain-
able economically, environmentally and
technologically. The concept of sustain-
ability has to be distributed throughout
the whole territory and be efficient, so
our quality of life remains at a high level.”
Paraíba
As the easternmost point in the Amer-
icas, Paraíba is another territorially
compact state that is beginning to punch
above its weight economically. Located
on the country’s northeast seaboard,
between Rio Grande do Norte, Ceará,
and Pernambuco, Paraíba is home to
Governor Renato Casagrande recently launched
PROEDES, Espírito Santo’s sustainable
development program.
Victoria, Capital of Espírito Santo

17. ECONOMIC DEVELOPMENT // PROMOTION 17
3.75 million people and attracted more
than a million visitors in 2012 thanks to
its pristine Atlantic beaches and historic
colonial capital, João Pessoa.
Tourism will likely remain one of the
pillars of Paraíba’s economy and an
important contributor to the growing
service sector, while industrial develop-
ment is focused on the country’s second
largest cement plant and a $500 million
canal that will irrigate almost 40,000
acres of agricultural land.
The federal government committed
nearly half a billion dollars to the larg-
est highway program it has undertaken
in Paraíba, which will pave almost 1,200
miles of roads and provide access to
50 cities by 2014. And last November,
Governor Ricardo Coutinho signed a
$250 million deal with the National Bank
for Economic and Social Development
(BNDES) to fund a wide range of infra-
structure projects.
TheseprojectsincludeoneofCoutinho’s
priorities: education. Paraíba already has
21citieswithhighereducationinstitutions,
but it is opening 15 new state technical
schools and has cut illiteracy by a third
in just two years. The governor believes
that an educated workforce is essential to
attracting business to the state.
“Paraíba is open for investment,” says
Coutinho. “It has a clear policy for pub-
lic and private investments. This is what
really matters, that the investment works
out, because when the company suc-
ceeds, the state succeeds as well.”
Piauí
More than four times the size of
Paraíba, but with a population of just
over 3 million, Piauí has traditionally
ranked among Brazil’s least developed
states. Mostly inland, with only 40 miles
of coast in the north, it is located in the
northeast and borders five other states.
In recent years, however, due to rich
natural resources and strong institu-
tional support, Piauí has been firmly on
course for a brighter future.
Government programs to alleviate
poverty have reduced the number of the
poor from 40% to 7% in a decade. With
five hydropower plants and wind farms
located in the north and south, almost
three-quarters of the state has easy
access to energy, and Piauí is a leader
in biomass. The state will soon be self-
sufficient in terms of energy, according
to Governor Wilson Nunes Martins, a
neurosurgeon by trade who was elected
in 2010 and is a descendant of Piauí’s
first governor.
The agribusiness sector is flourish-
ing. Soybeans, corn, cotton, cashews
and honey are its primary cash crops,
alongside seed production and livestock
Serra da Capivara National Park, Piauí

18. PROMOTION 18 // ECONOMIC DEVELOPMENT
rearing. Piauí also has Brazil’s third-
largest iron ore mine and possesses
phosphate, nickel and precious stone
deposits. Tourist attractions, includ-
ing its 100 miles of Atlantic and fluvial
beaches, the Parnaíba River Delta, and
the UNESCO World Heritage–listed
Serra da Capivara National Park, are
quickly diversifying the state’s economy.
“Piauí has great potential,” says Nunes
Martins. “We took big steps in the last
decade, having an annual revenue of $3
billion and annual growth of around 10%.”
Tocantins
Tocantins is Brazil’s youngest state,
created in 1988 after it split off from
Goiás to the south. Landlocked and bor-
dered by six other states, and home to
less than 1.4 million people, it covers an
area of over 275,000 square kilometers
in the heart of the country, on the border
between the Amazon rain forest and the
coastal savanna.
The Araguaia and Tocantins rivers
feed the region’s fertile pastures, and
it contains the world’s largest river
island, Ilha do Bananal. And the stun-
ning tropical savanna of Jalapão State
Park—the location for the 18th season
of Survivor—is becoming popular with
adventure seekers and ecotourists alike.
Governor José Wilson Siqueira Cam-
pos, a leader in the separatist movement,
has acted as Tocantins’ first, third, fifth,
and now eighth governor since the state
was created. In his career, he has helped
his state prosper, and in 1989 he oversaw
the construction of the Belo Monte hydro-
electric dam, Brazil’s first private-public
partnership. He also was instrumental
in paving over 3,000 miles of road and
extending 23,000 miles of transmission
lines statewide.
Inhiscurrentmandate,thegovernorhas
signed off on a $2.5 billion manufacturing
plant for Brazilian cellulose giant Braxcel.
The plant is projected to be producing 1.5
million tons of cellulose a year by 2018. He
has also authorized a Spanish company
to begin feasibility studies for a $375 mil-
lion surface transportation network in the
state capital of Palmas, and he recently
toured Spain to promote Tocantins’ envi-
able environment for development of
renewable energy projects.
Siqueira Campos has set up an envi-
ronmental and sustainable development
department to ensure that Tocantins
retains its place as the least deforested
state in the Amazon, while still furthering
economic progress.
“Our people are engaged in the pro-
cess of searching for innovation,” he
says, “because that way we do not hurt
future employment or economic com-
petitiveness. We have to promote social
sustainability.”
Velha waterfall in Jalapão State Park, Tocantins
Paraíba colored cotton is internationally recognized. Initially developed
by Embrapa (Brazilian Enterprise for Agricultural Research), the product
has been commercialized mostly by cooperatives, conquering national and
international markets. The c olored cotton appeals to the consumer market
that demands organic, environmentally friendly, hypo allergenic materials.
Paraíba aims to foster sustainable tourism. Paraíba
has 75 miles of breathtaking coastline as well as
Dinosaur’s valley, and archaeological sites. João
Pessoa, the state capital, is one of the oldest
cities in Brazil. Its beautiful historical downtown is
considered a heritage site by IPHAN (Historic and
Artistic National Heritage Institute).
PARAÍBAB E A U T I F U L A N D S U S T A I N A B L E