South of Brazil’s Industry Invests US$ 2 Billion in Equipment

Industries from the southern Brazilian state of Santa Catarina intend to invest US$ 2 billion up to the end of 2007. The money will be used for investment in technology, for the purchase of machinery and equipment.

These figures are part of a research by the Federation of Industries of the State of Santa Catarina (Fiesc) with the support of the Regional Development Bank for the Extreme South (BRDE).

Of the total to be invested, US$ 1.2 billion will be turned to industries installed in the state itself, US$ 700 million will be turned to units in other states in Brazil, and US$ 84 million will go to plants abroad.

The food sector is the one where most investment is forecasted, and it should receive US$ 840 million, which corresponds to 42% of the total. Electric material and communications industries, ironworks and mechanical product industries are also among the main investors.

Companies from Santa Catarina export to the Arab countries. The state sales to the countries in the region totaled US$ 60.66 million in the first four months of the year. The main products shipped were meats, ceramics, wood and soy oil. However, the Arabs are not part of the list of main countries to receive investment from Santa Catarina. They are China, Italy, Slovakia and Argentina.

Regarding the domestic market, the states to receive the greatest investment from Santa Catarina are Minas Gerais (SE), Goiás (midwest), São Paulo (SE), Paraí­ba (NE), Mato Grosso (Midwest), Paraná (S), Rio Grande do Sul (S), Bahia, Ceará e Sergipe (all three in the Northeast).

The study shows that 63% of the investment will be made with the funds of the companies themselves, 15.7% will be by investment banks, 13.4% will be financing by domestic banks and the rest will come from other sources.

Industries from Santa Catarina say that they are going to invest outside the state due to the existence of industrial units they own in other states, tax breaks, logistics, infrastructure, availability of qualified labor, identification of new customers and greater proximity to the consumer and supplier market.

Investment abroad, in turn, is to maintain company position on the foreign market. The study was organized by 147 companies in the state.

Anba – www.anba.com.br

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