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Brazil Risk Analysis

In: Business and Management

Submitted By feguedes
Words 2988
Pages 12
Executive Summary
Investing in Brazil, as with any country, entails exposure to a variety of political, social, economic, and other risks, but also entails potential benefits for multinationals corporations. Political Risk- Brazil has been a stable democracy for 25 years. Despite some unique risk as corruption, Brazil has been rating overall medium risk for dynamic risks, governance framework, political violence and business and macroeconomic environment.

Financial Markets in the country & Sources of Capital for the multinational corporation Brazil is now the eighth-largest economy in the world and will continue to seek a growing international role. The country has also been considered a confident player on the world stage and also seat temporary at the UN Security Council. The Brazilian Bovespa index of the Sao Paulo Stock Exchange has been doing very well with several shares from different sectors which are providing steady growth to the Bovespa index.
There are many financial service as the private multi-purpose commercial banks, universal banks, play the leading intermediary role in the country’s financial sector. Public financial institutions are also among the leading intermediaries, promoting rural economic activity and agricultural production through the provision of subsidized loans.

Tax Structure & Investment Incentives for which foreign based companies are eligible
Brazil’s Tax Laws and system, Brazil's corporate tax rate for 2010 around 34%. The tax consists of a basic tax of 15%. There is also a surtax of 10% for annual income of over BRL 240,000, about $ 110,000. Additional, all corporations are subject to a social contribution tax at rates ranging from 9 % are added on net profits
Firms may effectively reduce income tax liability by investing part of the tax due in government-approved incentive projects or by purchasing

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