Direct foreign investment doubles in the country in 2007
Valor Econômico 01/09/2008
The flow of direct foreign investment (DFI) to Brazil had the highest increase in the world in 2007, except for an exceptional situation that occurred in Holland, according to the data from the United Nations Conference on Trade and Development (Unctad). The inflow of DFI in Brazil grew 99.3%, from US$ 18.8 billion in 2006 to US$ 37.4 billion. The Unctad attributes the growth mainly to investments on natural resources, stimulated by the high in prices of raw materials. The global flow of DFI is estimated at US$ 1.5 trillion in 2007, surpassing the previous record in 2000. The abundance of liquidity and the strong profits of the companies leveraged the value of mergers and acquisitions until the first half of 2007, when the sub prime mortgage crisis exploded in the United States. Despite the little favorable economic projections for 2008 and the potential for hardening of the rules for foreign investments in natural resources, the Unctad estimates that the global high demand for commodities will continue pushing direct foreign investments, also from Arab and Asian sovereign wealth funds with gigantic Dollar reserves.