Interest of companies in doing business with Brazil declines, says PwC

The interest of the presidents of global companies in doing business with Brazil declined last year, according to the 25th edition of the CEO Survey, carried out by the consulting and auditing firm PwC in 89 countries, with 4,446 executives, in October and November of 2021.

Since 2013, Brazil has dropped seven positions in the ranking that assesses the importance of a country as a strategic market for global CEOs, according to PwC.

The country appeared in third place from 2011 to 2013. It had already dropped to eighth in 2021 and appears in this year’s disclosure in tenth position. Brazil is mentioned by only 4% of respondents, compared to 5% in the previous survey.

Australia and Canada have moved ahead of the country this year, joining the US, China, Germany, UK, India, Japan and France as the most attractive countries.

According to PwC, Argentina, Uruguay, Venezuela and Colombia are now the countries with the most interest in the Brazilian market.

On the other hand, the country lost importance to Peru, USA and Mexico in relation to the previous year. Brazil was cited by 6% of US company executives, up from 9% a year earlier.

The survey also shows that economic instability and social inequality are among the biggest concerns of CEOs of companies operating in Brazil, while executives around the world are more concerned about cyber and health-related risks.

Regarding the threats to their business, Brazilians highlight macroeconomic instability (cited by 69% of respondents) as their greatest concern, with its potential impacts on sales and the ability to raise capital.

Then come cyber risks (50%), social inequality (38%) and climate change (36%). Only 32% cited health risks.

Globally, executives are most concerned about cyber and health risks, cited by 49% and 48% of respondents, respectively.

Marco Castro, managing partner of PwC Brasil, says that there was a change from the previous survey, when the main concerns for Brazilians were related to tax issues, politics and the health crisis.

“This shows an interesting change in the agenda. When we talk about economic instability, it was natural for this to appear as a concern of Brazilian CEOs”, he says.

Castro also highlights the concern with cyber protection, citing a survey carried out in Brazil that shows that these expenses will be significantly high in 2022. “

The survey of executives also shows that the optimism of the presidents of companies operating in Brazil regarding the economy has decreased, but remains high: 77% of Brazilian and global leaders surveyed believe that global economic growth will accelerate in the next 12 months.

Globally, there was stability in relation to the previous survey. In relation to Brazil, there was a drop, compared to 85% in the previous survey.

For 6% of Brazilians, the economy will remain stable, and 17% believe that the global economy should contract, results close to the world average (7% and 15%, respectively).

The survey shows that 63% of Brazilian executives expect an increase in revenue from their companies, above the global percentage of 56%.

In Brazil, the most optimistic segments are agribusiness (74%), consumer companies (68%) and technology, media and telecommunications (67%).

In the world, private equity companies (67%), technology (64%) and real estate, insurance and pharmaceutical companies stand out, all three with 63%.

“This is closely linked to the fact that economies are in fact resuming their activities globally. We notice a trend of reinvestments and new programs. When we talk about this hybrid model, which seems to be prevalent in all developed economies , this requires a lot of technological investment and review of the organizations’ operations”, says the president partner of PwC Brasil.