01/16/2018 14h52

State economy shows signs of recovery according to Investe SPs assessment

Agency reported 33 investment projects assisted and announced in 2017, amounting to R$ 3.6 billion and 7,700 jobs, exceeding the figures reported in 2016

Investe São Paulo

Investe São Paulo, the investment promotion agency of the State of São Paulo, completed the assessment of its activities for attracting and retaining investments in 2017.

The figures reported by December 31 show a significant improvement in the state economy, since the portfolio of projects assisted by the institution totaled 188 projects that day versus 177 at the end of the previous year.

Of this amount, 33 were announced in 2017, amounting toR$ 3.6 billion in investments and 8,063 jobs.The figures exceed those reported in 2016, when 26 projects were announced, which corresponded to R$ 3.2 billion and 4,844 jobs.

The study of the projects announced also points to an increase in the percentage of foreign companies assisted by the agency.They corresponded to 75% of total projects in 2017, compared to only 50% in 2016. As for the investment value, foreign capital corresponded to 94% versus only 59% in 2016. Check the historical series below:

Context

The analysis of the investments announced performed by the National Investment Information Network (Renai), managed by the Ministry of Industry, Foreign Trade and Services (MDIC), shows that the services provided by Investe São Paulo reflect the state economy as a whole.

There has been a peak in the percentage of projects from foreign companies in São Paulo between 2013 and 2014. The year 2015 marked the fall of foreign investments, but with a rapid recovery in 2016 that remained in 2017. In Brazil, this recovery has not consolidated yet.Check the chart below:

It was not only in the investors’ area that Investe São Paulo expanded its scope to foreign companies.The Agency’s new business prospecting team also contacted a larger number of foreign companies in 2017 if compared to the previous year:of the 2,379 institutions surveyed, approximately 52% were headquartered abroad.In 2016, they represented 44% of the 2,052 companies.

Analysis

For the Business Director of Investe São Paulo, Sérgio Costa, the figures show a period in which investments are undergoing a recovery in the state of São Paulo.“We saw several projects that had been interrupted or postponed being resumed by some companies this year,” he says.According to the agency, many projects have evolved from ‘under negotiation’ to ‘under implementation’.

He also explains that, as a result of the crisis, Investe SP re-adapted the service provided by its team over the past two years, and started assisting projects that made lower investments but had high economic impact.And this ended up being reflected in the large number of projects assisted in 2017.

“In our first years of operation, our focus was on providing support to projects that produced investments that necessarily involved large financial contributions.Little by little we adapted our service and started prioritizing both the generation of innovation and the impact that some smaller projects would cause on the local community,” he said.

For Costa, the growing number of projects from foreign companies assisted by Investe São Paulo is mainly due to the agency’s efforts to build good relationships with diplomatic entities, chambers of commerce and business associations.Check out at the following charts that show the percentage of investment projects announced by country in the comparison between 2016 and 2017:

He also mentions the increase in the number of R&D projects assisted over the past year – Avon’s global development and innovation center, the semiconductor prototyping laboratory of Smart Modular Technologies and Pepsico’s R&D center for foods made from ingredients originating in South America.In total, these investments amount to approximately R$ 250 million and 244 jobs.

“Companies have been increasingly relying on our team to guide them within the rich innovation environment of the state of São Paulo, assisting them in the dialogue with research centers, universities and technology parks,” says Costa.

Regions

The division of investments announced by Investe São Paulo by administrative region within the state shows that in 2017 they were more dispersed across the territory than in 2016. Last year, the administrative region of Campinas concentrated 42% of the projects, followed by the state capital, which concentrated 31%.In 2017, the three regions that most welcomed projects were São Paulo, with 31% again, Sorocaba, with 27% and Campinas, with 21%.

Check the figures in the charts below.It is also possible to see how much, in 2017, other regions of the state of São Paulo appeared in the investments announced by Investe São Paulo:

 

Expectations

For 2018, Investe São Paulo expects to continue making efforts to expand the agency’s services across the state of São Paulo.“We are improving our mechanism to contact municipalities, since the support of municipal governments is crucial to ensure that more companies become aware of the services we offer,” said Álvaro Sávio, administrative and financial director of the agency.

He says that 2017 was also the year in which the agency consolidated the first phase of the work carried out as the operational center of Peiex – Industrial Export Extension Project in partnership with Apex-Brazil.Of the 131 companies assisted, 110 completed the satisfaction survey.A total of 88 of them – approximately 80% - considered themselves very satisfied or satisfied with the support received.

The second edition of SP Conecta also took place in 2017, bringing dozens of entities of the state ecosystem of support to innovation to be available to startups within the Technology Park of the State, where the Agency is headquartered.

“In 2018, we will highlight even more the role of Investe São Paulo as a bridge that connects so many institutions that collaborate to promote technological development and innovation throughout the state.And this will start with the Park itself, which has been increasingly becoming an important connection point,” said Álvaro Sávio, Director of Administration and Finance of Investe SP.He is responsible for a project to make the Technology Park of the state more active in hosting events related to startups.

In both his vision and that of Sérgio Costa, who currently coordinate the entire agency team, the year 2018 will represent the continuation of current efforts and growth for Investe São Paulo.

 During a breakfast with the consulates of São Paulo on Wednesday, December 14, Governor Geraldo Alckmin and the Vice-Governor and Secretary of Economic Development, Science, Technology and Innovation ratified the institution’s role in attracting foreign investments to the state.

About Investe SP

Investe São Paulo – the Investment Promotion Agency of the State of São Paulo, associated with the Department of Economic Development, Science, Technology and Innovation, is the gateway for companies that intend to settle their operations in the state or expand their businesses.

The agency provides strategic information free of charge, helping investors find the best locations for their businesses, providing environmental, tax and infrastructure advice, facilitating the relationship of companies with government institutions and public utilities.All this with the purpose of promoting economic development and innovation in São Paulo.

Another important mission of Investe SP is to encourage exports from small and medium enterprises, also for free.The Agency is also responsible for prospecting new businesses for the state around the world, welcoming foreign delegations and promoting the image of São Paulo in Brazil and abroad as the main destination of companies in Latin America.