Companies maintain investment plans
Folha de S. Paulo - 01/27/2008
The turbulence that took hold of the financial markets has not produced significant changes in the planning of the Brazilian companies yet. But it makes the businesspeople remain on alert to its unfolding and to the risk of a recession to be set in the USA. For the executives and analysts heard by Folha, in 2008 the bet is that the domestic market will continue as a locomotive of the growth. The expectation is that the most solid foundations of the economy also protect the country against a possible deepening of the crisis, preventing, for instance, abrupt variations in the exchange rate and in the inflation. According to those analyses, the risk of a possible recession in the USA would also be lessened by the strong profits obtained by the North American companies in the last years and by the vigorous growth of the global economy. Until 2007 the world lived the best economic period in more than 30 years. "Nothing has affected the real world of the non-financial economy yet. We should not precipitate any negative conclusion", affirms Paulo Skaf, the president of the Fiesp (Federation of the Industries of the State of São Paulo). In the opinion of the president of the CNI (National Confederation of the Industry) Armando Monteiro Neto the on-going investment plans should be preserved. "Those who invest look at a broader horizon, and, in 2008, the focus is the domestic market", he affirms. A consultation made by Fiesp between the 15th and the 22nd of this month among 36 large companies of nine sectors shows that this year's plans for production, investments, and job generation were not changed on account of the crisis in the international Stock Markets or the fear of recession in the USA. In January, the sales of São Paulo commerce have also maintained the same rhythm as last December. In the automobile sector, the activity gauge in several areas, sales in the domestic market in the first fortnight of the month went up by 35.5% compared to the same period of 2007.