Brazilian businessman demands more government support to encourage investment in Africa

‍An invitation to work for an airline, holding a leadership position in the cargo transport sector, made the gaucho Marcos Brandalise leave Germany, where he lived as a newlywed with a German woman, for Angola, in 1988, in the middle of the civil war that marked the history of the Portuguese-speaking country.

Five years later, he was transferred to East Africa. And it was in Kenya, one of the largest African economies, that he decided to live with his family and, in 1996, set up his own company to present, in this region, solutions that had achieved good results for Brazil in previous years, especially in agriculture. Marcos started representing Brazilian companies here. “We saw what happened in Brazil in the 1970s, 1980s, 1990s, and what is still happening. We imagine and hope that Africa will follow the same path as Brazil. The potential here is phenomenal,” he said. He currently represents around 15 Brazilian companies and sells everything from electric showers to agricultural machinery.

Kenya is facing a wave of protests against the new government over the rising cost of living in the country. But the recent demonstrations are not the first that he has witnessed, and that does not deter one of the oldest - if not the oldest - Brazilian businessmen investing and living in the complex and promising African continent. Self-declared stubborn, he is an enthusiast of the idea that Brazil should look more at opportunities and develop partnerships with the second most populous continent on the planet, despite the challenges of this region that, until six decades ago, was dominated by European colonizers. “The process of getting rid of the colonialists started in the 1960s. So, they are recent democracies or governance. Their process is much younger.

Many realities

This subject was addressed in the interview not only because of the recent protests in Kenya, but because the fear of military coups and the climate of political instability ends up being one of the reasons why Brazilian businessmen are reticent when it comes to the continent that, until 2050, should concentrate 25% of the world's population. Throughout the interview, the Brazilian reinforced the diversity of Africa, which many seem to ignore when looking at this part of the planet in a homogenized way. “There are 54 countries and each country is a culture”, he points out, although he recognizes that there are similarities. “Each country is different, you can't generalize 'Africa'. You have to look at each country in a different way. There are some with much more risk, others with much less risk and others without risk”, he reinforces.

The Brazilian is optimistic when it comes to the new generations of Africans. “The continent is experiencing a super interesting moment. Younger generations, well-educated, locally or internationally, are coming back with good ideas and want to innovate. And agriculture, in recent years, has been an area that they have a lot of interest in,” he said.

With a pragmatic and realistic vision, the Brazilian who has lived in the African continent for more than 30 years does not romanticize his speech to encourage investments in this region. “There are many 'holes': the cultural hole, the political hole. For example, in agriculture, wild animal life is huge here in Africa, in many countries. So, that counts to be careful, not to harm this life, which is an African wealth, but also a challenge for agriculture”, he stressed. The pastoralism that still exists on a large scale is another “hole” highlighted by Marcos to be careful of, as well as land titles. “ One of our advantages is that we understand the culture, and we understand how to deal with communities, wildlife, and other things. You can't ignore this because otherwise, people fail.

Opportunities

Brazil still has excellent internal opportunities, which means that Brazilian businessmen are not always interested in crossing the Atlantic Ocean to take advantage of new investments. But the lack of knowledge and the fact that they are based only on experiences that didn't work out also keep Brazilian investors away from the African continent, in Marcos' opinion.

Something that can stimulate the implementation of Brazilian projects in Africa, it would be for the BNDES to look at the continent again. The Bank's internationalization returns to the center of the debate among specialists now in the Lula government. Although the BNDES was created in 1952, it was in the 2000s that support for the internationalization of Brazilian companies began to be seen. It even had three offices abroad: in Montevideo, London and Johannesburg, opened ten years ago. The three were closed shortly after Michel Temer assumed the presidency. “I met the people who ran the BNDES in Johannesburg. They made a lot of efforts to enter the continent and finance some programs, but they came across an obvious thing: other countries also have similar programs. The initiatives were good, the Johannesburg office was good. The motivation was there to make it happen, but unfortunately,

A subject on which the report also heard the president of the Brazil-Africa Institute (IBRAF), João Bosco Monte, who highlighted two failures. “It's been less than three years of operation on the continent, and the bank hasn't said exactly what its interest in that space was. It is not possible to cover the entire continent with the scarce staff. It wasn't a very generous, very large team. And the second mistake was that Brazilian companies did not know about the existence of a bank financing Brazilian companies in Africa. So, ignorance was perhaps the fatal error, ” he clarified.

The businessman from Rio Grande do Sul pointed out that there is still great potential in this region. “But we have to remember that there are a lot of competitors coming into Africa, especially now. So there has to be a change, maybe. A reassessment of how we provide funding and everything else, which is extremely important and can greatly facilitate Brazilian investment in the continent and the vision of the continent with Brazil (may) improve as well”, he said.

Marcos acknowledged that, in the past, President Lula brought the African continent closer to Brazil, but he criticized the way in which this was done. “He gave a lot of support to big contractors. I think small activities would have had more results”, he pondered.

The president of IBRAF also believes that not only the “champions” can have access to bank financing. “Other medium and small companies can and should also be able to talk and do business in Africa with the BNDES partnership in an objective and direct way”, he reinforced. For João Bosco, it is necessary to rethink government support, through a financing bank so that Brazilian brands, products and services reach African spaces, but also collaborating with the other side. “African companies may also be interested in doing business with Brazil and in Brazil based on our greater representation on the African continent,” he concluded.

When speaking to RFI, Marcos Brandalise said he disagreed with some Itamaraty policies and says that investors from countries like Italy, Turkey and China, for example, have more support from their governments. “Brazil is still at an early stage when it comes to doing international business. They still have an, I would say, archaic vision of how to do business internationally”, he observes, making it clear that “there is still a long way to go for the Brazilian government to improve relations between Africa and Brazil”.

BRICS

President Lula should only make his first trip to the African continent in August, when he will participate in the BRICS summit in South Africa. In the interview, Marcos stated that he thinks the BRICS is a super interesting association, but that it can be better explored. He points out that it is still necessary to be careful with countries in the Northern Hemisphere, which hold hegemony in several aspects. “Brazil has to continue playing its role of neutrality, in several aspects, but it has to see its part in the economy. BRICS can be as important for Brazil as all the other economic blocs that exist in the world. Brazil is and must continue to be a friend of all blocks, ” he said.

The entrepreneur follows the logic of the greater the risk, the greater the profit margin. And he points out that there is “a phenomenal potential” when it comes to Brazil's relationship with the African continent. “Because the African likes the Brazilian and wants to do business with Brazil, but the mechanisms don't really exist”, he pointed out.

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By: Vinícius Assis, RFI correspondent in Addis Ababa