1. Brazil is the 5th largest country by area and has a highly advanced economy, with 45% of its energy coming from green sources. It is a major producer of minerals, fuels, foods, and manufactured goods. 2. Brazil's economy has grown significantly in recent decades and is projected to continue growing at 6% annually. Major cities and economic centers are concentrated along the eastern coast near natural resources in the west and central regions. 3. Brazil has developed world-leading innovation clusters in sectors like aerospace, information technology, and green energy such as biomass and hydro power where it is a global leader. The economy is transitioning toward knowledge-based industries and services.

2. Preface: What Does the World’s 5th Largest Country look Like from Space? Why? Source: NASA (United States – National Aeronautics and Space Administration)

3. INTRODUCTION: Brazil Structural Framework and Forward Trends . . .

4. Framework: Structural Determinants of Brazil’s Economic Geography … West Largely Uninhabitable … 80% Population in East A-Cities – Highest Population and FDI Amazon Forest S-Cities – Mid-High Population and FDI Manaus Fortaleza Recife People Salvador Belo Horizonte Rio De Janeiro Sao Paulo Curitiba World’s 5th Largest Country Highly Advanced Economy Porto Alegre Energy Independent, 45% Green Aircraft, Automobiles, Petrochem World’s 3rd Largest Food Exporter Agribusiness & Natural Resources

5. Economy: Growth in Brazil’s Economy IMF Projected Growth Rate at 6% for Next 5 Brazil GDP (PPP Adjusted) (USD, trillion) Host Olympics (2016) Host the World Cup (2014) Global Financial Crisis IMF Forecast USD trillion 2x Actual Source: World Bank, IMF

6. Wealth: Brazil to have 2nd Highest GDP per Capita among BRIC Countries Brazil GDP per Capita: USD 5,700 (2009) … USD8,800 (2020) 2020 Brazil GDP per Capita 2009 Source: ERSUSDA

7. Income: Brazil Per Capita Disposable Income in Tandem with China Per Capita Disposable Income Growing at Average 6% Per Annum Brazil Disposable Income Per Capita (USD per annum) Russia China India Source: GS Global ECS Research

10. 3rd largest manganese reservesSource: US Geological Survey

15. Leading (#1) coffee exporterSource: Food and Agriculture Organization, International Coffee Organization

16. The Future 2020: 1 of 5 Countries Highest Combined - GDP, Population, Resources > USD3 trillion GDP … 100+ million people … > 3 million sq km Over 100 million People Over 3 million sq km Indonesia Philippines Canada Bangladesh Pakistan Brazil US India China Russia Australia Nigeria Ethiopia Mexico Japan Germany France Italy Over US$3 trillion GDP (PPP) United Kingdom

17. Corporate Trends: Structural Optimization – Markets, Resources, Innovation

18. Corporate Burning Platforms: Markets, Resources, Innovation Market Access/Revenue Growth … Global Structural’ Cost Reduction Markets Knowledge REVENUE R&D INNOVATION Sales Engineering IT HR Service Efficiency Efficiency/ Shared Services F&A Procure Distribution Sourcing Innovation/ Knowledge Production /Assembly Resources/ Cost Reduction COST Markets / Revenues Resources DRIVING Shareholder Value

19. 1. Market: Car Sales/Production Proxy for Directional Market Sizing? Leading Position for Car Penetration among BRIC Brazil Car Penetration in BRIC (units per 1,000 people) Russia Car Penetration in Brazil (units per 1,000 people) China India Sources: GS Global ECS Research, Other

20. USD47 billion Market by 2015 … 5th in World 1. Market: Projected to be World’s 5th Largest Pharma Market by 2015 Pharmaceutical Market Size Country Ranking (2000 – 2015f - USD billion) Sources: IMS; GSK, “Assessment of Opportunity for Pharmaceutical Manufacturers in Emerging Markets” JMCP; Monitor Analysis; Exolus

21. 1. Market: High Spending Growth Resumes after Global Crisis Sales Growing at 28% CAGR Retail Sales Growth USD Million Source: EIU, Planet Retail

22. 2. Revenue/Costs: Where are Pareto-Optimal Market/Resource Envelopes? Intersection of Natural Resources (West) … A/S Cities … People (East) Per Capita Annual Income (USD, PPP-Adjusted) Per Capita GDP / A/S-City Overlay Roraima Amapa Para A-Cities Amazonas Maranhao Rio Grande do Norte Ceara S-Cities Paraiba Pernambuco Piaui Alagoas Tocantins Acre Rondonia Sergipe Bahia Mato Grosso Goias Minas Gerais Mato Grosso do Sul Espirito Santo Sao Paulo Rio De Janeiro Parana Santa Catarina Rio Grande do Sul Source: Brazilian Institute of Geography and Statistics

23. 2. Production/Resources: Where are other Key Investment Nodes? Car Investment Proxy for Investment Destinations? Brazil Automotive Production OEMs Suppliers Manaus Fortaleza Recife Salvador Goianis Belo Horizonte OEMs Rio De Janeiro Sao Paulo OEMs Suppliers Curitiba Suppliers OEMs Porto Alegre Suppliers

24. 2. Production/Resources: Sao Paulo State Immense, Larger than the UK Sao Paulo State (248,209 km sq) larger than United Kingdom (243,610 km sq) Sao Paulo (State) (248,209 km sq) United Kingdom (Country) (243,610 km sq) Sao Paulo City Sao Paulo State Sources: Publically Available Information

25. 2. Production/Resources: Management Sourced in Sao Paulo, Labor Local Sao Paulo Brazil’s Leading Foreign Investment Destination Sao Paulo State (248,209 km sq) Campinas San Jose dos Campos Osasco São Paulo Mauá Sao Bernardo do Campo Sources: Publically Available Information

26. 2. Production/Resources: Rio State Immense, as Large as Countries Rio de Janeiro State (43,696 km sq) roughly same size Switzerland Rio de Janeiro (State) (43,696 km sq) Switzerland (Country) (41,285 km sq) Rio de Janeiro City Rio de Janeiro State Sources: Publically Available Information

27. 2. Production/Resources: Management Sourced in Rio, Labor Local Rio de Janeiro Region a Leading Investment Destination for Oil and Gas Sector Rio de Janeiro State (43,696 km sq) Sources: Publically Available Information

28. 3. Innovation: Where are Leading Innovation Nodes? Innovation clusters Focus Areas Electronics Life sciences Information technology Sao Luis Fortaleza Telecommunication Manaus Health Microelectronics Recife Nuclear energy Aeronautics Oil technology Agriculture Salvador Bioenergy Belo Horizonte Vitoria Santa Rita de Sapucai SanPaulo Rio De Janeiro Sao Jose de Campos Campinas Londrina Curitiba Florianopolis Sao Leopoldo Porto Alegre Sources: Kirsten Bound, “Brazil the Natural Knowledge Economy”; Isabel Bortagaray, “Innovation Clusters in Latin America”

29. 3. Innovation: The Largest Aerospace Cluster in Southern Hemisphere Anchor: Embraer – World’s 3rd Largest Aircraft Manufacturer Solutions & Design Engineering Tecplas VBJ Engenharia Vectra Technology Rastreal TKA Mikro-Stamp Phoenix Serviços Aeronáuticos Winnproject Fibraforte Engenharia Lima & Bonfá Avionics Lane Design Flight Solutions Flight Technologies GMP Marcatto Gyrofly Lanmar Marcatto Massucato Lacit Winnstal UTEC Pan-Metal Friuli Globo Usinagem Ambra Solutions Geometra BTE Mectron Inbra-Aerospace Aerolane Aeroarte Akaer Brascopter Embrasim EQE ESRA Finetornos Giovanni Passarella Grauna Aerospace Sources: DECOMI, “Brazilian Aerospace Cluster, Believing in Great Ideas”

30. 3. Innovation: A Global Leader in Green Energy - Biomass, Hydro Installed Green Energy: Brazil 45% … OECD Average 7% … World 12% Primary Energy Supply* Green 45% Green 12% Green 8% *For Year 2008 Source: International Energy Agency, Brazil Ministry of Mines and Energy

31. Brazil’s Economic Health

32. Senior Executives Select Brazil as a Top Global Investment Destination Brazil Top 5 Investment Destination in World Top 14 Most Attractive Destinations for Future Investment (2009 – 2011) % Percent of Responses Source: World Investment Prospects 2009 - 2011

34. In 2011 the Central Bank has accumulated over USD 316 billion in foreign reserves, up from USD 50 billion in 2004.

35. The accumulation of large external surpluses means financial system enjoys abundant liquidity.

36. Low External Debt/GDP Ratio and Positive Current Account Balance

37. Healthy external debt to GDP ratio at 14% of GDP in 2010.

38. Federal budget deficit at 2.3 % GDP in 2010; projected to decrease to 1.7% of GDP in 2011.

39. Brazil’s Banking System under Stable and Rapid Expansion

40. Banking deposits grew at CAGR or over 29% during 2002 – 2008 which indicate strong confidence of people to bank system. Moreover, the deposit system remained mostly unaffected through the global credit crunch .

41. Banking sector assets are projected to grow at a CAGR of 10% from 2010 to 2013.Source: Central Bank of Brazil, OECD

42. For a Comparative Perspective with the other BRIC Countries Please Refer to the Following Research Reports Found on Slideshare @ http://www.slideshare.net/contest/worlds-best-presentation-contest-2010/entries http://www.slideshare.net/Exolus/india-2020-what-india-will-look-like-in-the-future http://www.slideshare.net/Exolus/russia-2020-what-will-russia-look-like-in-the-future Download Reports @ www.exolus.com/en/knowledge/research.html Russia 2020 India 2020 China 2020

43. Global Expansion Strategy & Cross-Border Investment Execution (Greenfield, M&A, Joint Ventures, Outsourcing) About Exolus: Exolus is a hybrid management consulting and transaction advisory firm. We work with management teams in the development of their global expansion strategies, across the range of investment formats: Greenfield, M&A, Joint Ventures and Outsourcing. As well, we deploy against global strategies by providing program management across all phases of cross-border investment projects, from candidate searches and evaluation, through investment structuring and negotiations. The founders of Exolushave spent the past two decades in the global service space and have direct experience operating in nearly all of the major investment destinations in the world (40+ countries). The team has served clients of all sizes, both public and private, on projects that ranged in investment size from USD10 million to greater than USD1 billion. We have served clients across all of the following industry segments: Life Sciences, Manufacturing, Automotive, Technology, Retail, Consumer Business, Real Estate, Public Sector. Follow Exolus at: www.exolus.com Need Further Information: info@exolus.com Want Copies of our Reports: www.exolus.com/en/knowledge/research.html

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