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Invest Minas: Navigating Foreign Direct Investment Opportunities in Minas Gerais, Brazil with Gustavo Almeida

by | Feb 23, 2024

Gustavo Almeida
Chief Operating Officer
Invest Minas
gustavo.almeda@investminas.mg.gov.br

LATAM FDI: Hello. Today we have Gustavo Garcia Almeida with us. Gustavo is the Chief Operating Officer of an organization called Invest Minas. Invest Minas is in Belo Horizonte, Brazil. Gustavo, I’ll let you tell us a little bit about yourself and your organization.

Gustavo Almeida: Thanks for having me. It’s such a pleasure to talk to you. So, a bit about me. I’m deeply passionate about government relations and investments. Over the past 15 years, I’ve had the privilege of working closely with the public and private sectors, helping them navigate through strategic implementation of plans, fostering business development, and promoting investment opportunities. I’m currently, as I said, the Chief Operating Officer at Invest Minas. Invest Minas is the investment promotion agency for the State of Minas Gerais, Brazil. I’m grateful to be here today doing international relations and discussing investment opportunities in Minas Gerais.

LATAM FDI: Well, thank you for that background information. Let’s start today by discussing the type of participation foreign companies are engaged in in Minas Gerais. Can you provide examples of notable foreign companies that have established themselves in Minas Gerais and what factors influenced them to choose your region?

Gustavo Almeida: There are several reasons why companies establish operations in Minas Gerais. Through Invest Minas, we point to factors such as abundant resources, skilled labor, government incentives, and proximity to markets. I think that those factors have influenced companies’ decisions. For example, we have a British company called Anglo-American and an Australian company called Latin Resources here. The availability of minerals such as iron ore attracted them. Recently, Invest Minas has helped Amazon and Mercado Libre, the Argentinian company, establish facilities in Minas Gerais. They chose to install their distribution centers here in Minas Gerais due to its strategic logistics position and the need to reach customers quickly. Nowadays, we all know that people are willing to pay a little more for their purchases to arrive faster, and these companies understand that. Another example is Solaico, which is a Spanish company in the solar energy sector. They decided to set up in the state with the help of Invest Minas because of the availability of natural resources, aligning themselves with the growing global need for sustainability. So, we have many examples of international companies that decided to come to Minas Gerais and have received assistance from Invest Minas. We have Canadian companies, Dutch companies, Danish companies such as Novo Nordisk, Japanese companies, and Italian, French, and Chinese companies as well.

LATAM FDI: You spoke about companies that are involved in mining services, Mercado Libre and Amazon. What other kinds of industry are in Minas Gerais? It’s my understanding that there’s a significant automotive industry. Maybe you could say a little bit about that and others?

Gustavo Almeida: Yes. Minas Gerais is the regional mining land in Brazil today. However, it has a diversified economy with significant contributions from many sectors. I’ll mention three traditional sectors that have worked with Invest Minas, and maybe we can talk about others that I consider to be emerging sectors. The state’s three traditional industries are mining, agribusiness, and auto manufacturing. For example, mining is historically strong, especially in iron ore and its products. It’s important to highlight that the company, formerly known as Vale Doce, one of the world’s biggest mining companies, was founded here in the city of Itabira. Agribusiness is also very strong. I think Minas Gerais is the largest coffee-producing state, with more than 55% of Brazil’s production. We usually say that Minas would be the world’s largest producer if it were a country. And it’s also the largest producer of other products, such as milk and potatoes. It ranks second in sugar cane and beans and third in producing tomatoes, chickens, and eggs. When talking about the auto industry, this is also very relevant. We have a Stellantis factory here. It owns the Fiat brand. It is here in the metropolitan area of Belo Horizonte.

A vast number of supplier factories surround the factory itself. There’s also an Italian Iveco factory in the city of Sete Lagoas. This plant manufactures everything from trucks and vans to military vehicles. Yes, Minas Gerais is growing faster and becoming more and more diversified. Regarding the emerging sectors, we can talk about renewable energy, which in Minas Gerais is the largest in Brazil. The tourism sector has also stood out a lot. Pharmaceuticals and also the logistics segment have been highlighted. Places in Minas Gerais are rapidly running out. And the demand is only growing because the state has excellent logistical advantages. We at Invest Minas can help foreign companies make their investments and establish their facilities.

LATAM FDI: You mentioned logistics in a little more depth just now. What’s the state of infrastructure in Minas Gerais, particularly in terms of transportation, logistics, and connectivity? And how does Invest Minas facilitate operations in your state?

Gustavo Almeida: Okay, that’s a great question. Infrastructure is always a priority. Like the United States, Brazil relies heavily on roads to transport people and goods. Minas Gerais has the largest road network in Brazil. It accounts for around 16% of the country’s total. There are over 272,000 highways. This includes federal, state, and municipal roads. And in terms of road conditions?  Most federal and state highways are paved, but there are still unpaved municipal roads, especially those in more remote areas. So, the state is actively investing in improving infrastructure, including improving airports and regional flights through partnerships with airlines. For international travelers, for example, reaching Minas Gerais right now is relatively straightforward. For example, there are direct flights from Orlando and Fort Lauderdale to Belo Horizonte from the United States. From here, travelers can easily access other parts of the state and the country.

LATAM FDI: Regarding the investment environment for foreign companies that might want to make a foray into Minas Gerais, are there government initiatives or policies in place to encourage and support both foreign and domestic investors?

Gustavo Almeida: That’s a good question. There is, and there are. Minas Gerais’s investment environment is diverse, and it has a supportive government. In general, the environment in Minas Gerais is considered one of the prime business locations in Brazil. As I mentioned before, the process of opening and operating companies is straightforward, with a skilled workforce readily available, the land offered at fair prices, and logistical advantages. There is also abundant energy and the second-largest consumer market in Brazil. The government right now is a very investor-friendly offering. For example, various tax incentives are in place to attract and support both domestic and foreign investors. The State Department of Finance, for example, provides benefits to over seventy sectors. For example, deferral of VAT tax. With the acquisition of inputs within the state, VAT rates and even zero rates for specific sectors are reduced. Numerous credit lines are also available to support investment endeavors, particularly through the State Development Bank. The government actively promotes investment through Invest Minas, which serves as a comprehensive support center for investors. We are a one-stop shop for investors. We offer unified assistance, collaborating with public agencies and private entities to ensure the project succeeds throughout all operations and development stages.

This includes, for example, providing market intelligence to help identify suppliers and potential clients and assistance with projects. Yes, that’s it. Minas Gerais presents excellent investment opportunities. As a result, many Brazilian and foreign companies are choosing the state as their headquarters.

LATAM FDI: Tell us a little bit about the workforce. How would you describe it regarding skills, education, and overall productivity?

Gustavo Almeida: Well, the workforce is very well-educated. The state has consistently ranked among the best performing, and the main education quality index is called IDEB. Moreover, Minas Gerais stands out for its abundant federal universities, which hold the highest concentration in the country. Just as a fun fact, Brazilian federal universities are recognized as elite institutions renowned for their excellence in research, development, patent production, etc.

LATAM FDI: Are there specific workforce advantages, such as a skilled labor force or a competitive wage structure, that make Minas Gerais an appealing destination for investors?

Gustavo Almeida: Yes, there are. Due to the state’s vast size, many different skill sets are available. Universities actively develop these skills according to the strengths in various economic sectors. For example, the state’s central region, specifically in Belo Horizonte and its metropolitan area, strongly emphasizes biotechnology, startups, and services in general. The Federal University of Minas Gerais in Belo Horizonte is a hub for this, along with many technology centers in our capital city. We have been recognized to be in the top ten of the best startup ecosystems in Latin America, and Belo Horizonte ranks in the top three cities with the most startups in Brazil. Here, there are over five hundred startups. I just spoke about the center of the state. In the south of the state, a robust region focused on technology development encompasses cities like Itajubá, São Tiago, and Sapucaí. These cities concentrate on sophisticated educational institutions and house technology centers specializing in electronics, such as the Federal University of Itajubá (UNIFE) and also INATEL, the National Institute of Telecommunications. There are also significant hubs in the agriculture sector, especially in the triangle region that includes cities like Uberaba and Uberlândia, and also in the south of the state, which produces the best doce de leite in the world.

So, these regions offer a skilled label force and also feature competitive wage structures, making them attractive to investors seeking opportunities here.

LATAM FDI: Well, we’ve covered a lot of ground in a short period, Gustavo. What inevitably happens after our listeners tune in to our podcasts is they produce questions that haven’t been addressed during these conversations. We would like to provide contact information so that people with questions can contact you directly. How would people contact you?

Gustavo Almeida
: Yes, they can contact me by email, which is the best way. My email is: gustavo.almeida@investminas.mg.gov.br.

LATAM FDI: At the top of the transcript section on our podcast pages, we have links to the organization websites of the speakers that join us, and we’ll also include a link to your LinkedIn profile so that people can contact you in that way as well. Would that be okay?

Gustavo Almeida: That’s perfect.

LATAM FDI: All right, thank you very much for joining us.

Gustavo Almeida: Thank you so much. Thank you for the opportunity to present information on investment opportunities in Minas Gerais. I hope your listeners may visit us someday and be in touch. Thank you so much.

LATAM FDI: Okay, thank you.

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