Updated 6 months ago

With a population of more than 200 million and a growing middle class, Brazil represents many investment opportunities. Real estate, tourism, restaurants and bars, and private schools represent some of the possibilities. However, Brazil remains a highly bureaucratic country which is not especially conducive to business. Be sure to do your due diligence before launching any business endeavour here. You can begin educating yourself at the Brazilian Ministry of Foreign Affairs or Ministry of Taxes.

 Good to know: The most common ways to invest in Brazil are via the purchase of real estate in the country, or through the opening of a brick-and-mortar business.

Real estate

Real estate represents the easiest way for the savvy investor to invest in Brazil.

Foreigners have shown keen interest in Brazil in the past 15 years or so. This interest should come as no surprise. Brazil possesses a unique and vibrant culture, and many lovely areas. Its coastline stretches for thousands of kilometres. The weather throughout most of the country is tropical or subtropical. It does not experience earthquakes, hurricanes, and only rarely sees a tornado. Add to this the fact that land and buildings are generally cheaper here than in Europe or North America to see why there has been a real estate boom in Brazil.

Beginning around 2000 and continuing until about 2013, there was unbridled construction in many parts of Brazil, notably in the Northeast, but in other pockets as well. Then the recession hit. The result is that there is now a glut of units on the market, particularly in beachfront areas, very much like what was seen in the US, Spain, and other countries several years back.

There is a buyer's market and opportunities for those who can invest now and wait a bit to see a return. Foreigners can own property, with just a couple of restrictions. Here are a few points to be aware of:

  • While foreigners may own real estate in Brazil, they are prohibited from owning land bordering another country, or owning large farms – restrictions which will not apply to most.

  • Title insurance is not common in Brazil. Therefore, hire a competent real-estate attorney to check for any liens or encumbrances.

  • Financing is difficult for foreigners to obtain in Brazil, and in any case, bank interest rates are quite high. Developers may provide some financing in the current down market, but it's best to come armed with cash.

Opening a company

Opening a business in Brazil is not straightforward, and neither is closing a business should you find that it is not going well. Accordingly, enlist a local attorney and do very thorough research before deciding to open a company in Brazil. Here are a few important points to note:

  • You'll need to have a local partner, who can be either a Brazilian or foreigner with a permanent residency status. In one way this is good – as you'll want a local adviser. But it, of course, means first locating a person you trust.

  • Financing a project can be quite complicated for an expatriate in Brazil, and interest rates are often usurious. Brazil's taxation code is complex, and special assessments common. So consult with a financial adviser who knows Brazil well.

  • Be aware that labour laws strongly favour the employee in Brazil. It is typically neither easy nor inexpensive to fire an employee.

Business opportunities in Brazil

Despite the caveats above, there are solid investment business opportunities in Brazil. Quite often, foreigners choose to open one of these businesses:

  • Language schools. These are a huge business is Brazil today as Brazilians want to learn English, but also French, German, Italian, Chinese, and other languages. An English-speaking foreigner opening an English school automatically has credibility and could do well.

  • Hotels. Many foreigners find an enjoyable life in Brazil living in a tourist location and operating a pousada (small hotel).

  • Nationality-based restaurants or bars. English or Irish pubs are examples of businesses which often fare well here. Australia's Outback restaurant chain has been wildly successful.

The investment visa

For those with the requisite funds to invest, Brazil offers an investor visa which can result in permanent residency. You can learn the details by visiting this website. While this visa can lead to permanent residency, due to the investment required and the complexities of doing business in Brazil, it is not recommended as an avenue if you merely wish to gain residency in Brazil.

 Useful links:

Ministry of Taxes of Brazil
Ministry of Foreign Affairs 
Apex Brazil
Company Formation in Brazil
Brazil citizenship by investment

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