Message of Swiss Ambassador to Brazil

Wilhelm Meier

Annual Report 2008; pag. 19
Since autumn 2008, the world economy has been confronted with a deep financial crisis challenging global institutions and governments. The temptation to apply subtle protectionist instruments has increased markedly. The global context has become more complicated, and hardly a country appears to have been spared from the consequences of the economic downturn. Mostly welcome is therefore the strong prevailing political will to reinforce and foster the bilateral relations between Switzerland and Brazil.

Also during 2008, regular high level contacts took place. In March, the Swiss State Secretary of Foreign Affairs, Mr Michael Ambühl, held political consultations in Brasilia. In August 2008, Micheline Calmy-Rey, Swiss Federal Councillor and Minister of Foreign Affairs, paid Brazil a visit and signed together with Celso Amorim, the Brazilian Minister of Foreign Affairs, the “Memorandum of Understanding on a Strategic Partnership between Switzerland and Brazil”. The Memorandum, together with a similar instrument in the economic field, lays the foundations for further development and deepening of our bilateral relations.

In 2008, bilateral trade as well as mutual investments reached new record heights. Swiss exports to Brazil have shown strong resistance against the cooling-off of global trade and grew by 29%, thus exceeding the growth rate of 28% achieved in 2007. Given the Brazilian export structure, it is understandable that Swiss imports were more affected and decreased by 2%. All in all, however, total trade increased by more than half a billion Swiss francs in 2008.

Swiss investments in Brazil were also quite impressive. According to the Swiss National Bank, the stock amounted to nearly 35 billion Swiss francs by the end of 2007, with Swiss companies employing more than 105,000 people. Thus Brazil is the fourth most important destination for Swiss investment abroad, surpassed only by the USA, the UK and Germany. This confirms the ever stronger interest of Swiss companies in Brazil and their confidence in the country’s potential.

Another important fact is that investment has been flowing more and more the other way around too. Major Brazilian companies have found out that Switzerland offers highly attractive conditions for development of their European and global activities, and have, consequently, been operating out of Switzerland. Undoubtedly, Swisscam and the Swiss Business Hub have been playing an important role in making the geographical advantages of Switzerland known in Brazil. The most visible events in this context were the two jointly organized investment seminars in Porto Alegre and São Paulo in October 2008. For the year 2009, two similar events are planned to take place in Joinville and Curitiba.

Swisscam, in cooperation with the Swiss Embassy, also hosted seminars on patents and intellectual property rights with expert keynote speakers from Switzerland and Germany. The events took place in June of 2008 in São Paulo, Rio de Janeiro and Brasilia. Such events are of great importance in today’s hi-tech world!

And what about the Brazilian economy? The beginning of 2008 was very promising: steady growth rates, inflation under control, increasing foreign reserves, a booming stock exchange, and an impressive primary surplus accompanied by a declining public debt. This positive performance has been the result of the stability-oriented economic policy adopted by Brazil, which was reflected in an improved international rating. In the first half of 2008, the world economic crisis still appeared to be far away. Unfortunately, the dramatic downturn of the world economy during the second part of the year also started to affect Brazil. The country’s economic indicators still look better than in most other countries, but the situation at the beginning of 2009 calls for a realistic assessment of the economic outlook. Today, Brazilian policy makers must envisage measures to spare Brazil as much as possible from the negative consequences of the global economic crisis.

Because of the bleak economic situation, strengthening the Swiss-Brazilian ties with concrete steps has become even more important! In line with this, the second meeting of the Joint Economic Commission will take place in Brasilia in March 2009. Furthermore, a bilateral agreement on scientific and technological cooperation is being finalized and is to be signed soon. As a result, direct contacts between our scientific communities are going to be reinforced. Also the agreement on bilateral exchange of trainees, pending for quite a while, is about to be concluded within the next few months. And last, but not least, contacts at the highest levels are expected to take place in the current year.

We are all well aware that we are still going to go through hard times. The Swiss-Brazilian Chamber of Commerce and Swiss companies will, as in the past, surely contribute in a significant manner to overcome the challenges and to further enhance the already excellent Swiss-Brazilian business relations. I highly appreciate these contributions. In these difficult times we shall prove together that “when the going gets tough, the tough get going”!