Tallys Yunes, an associate professor of management science at the School, moderated the panel discussion, which included several participants who flew in from Brazil for the event. Yunes, who is Brazilian, greeted the crowd in both English and Portuguese; when he asked how many audience members spoke Portuguese, a large portion of hands went up.
The panelists agreed that Brazil’s economy is in a bad place right now. It dropped 18 spots in the World Economic Forum’s Global Competitiveness Index this year – the third year in a row it has lost ground. GDP growth has been negative for several years, with revenues in most sectors falling between 20% and 40%. But the country’s size and previous decades of growth mean, “if you are a global player, it’s hard to ignore Brazil,” noted Luciana Soledade, an attorney with Brazilian law firm Felsberg Advogados.
With the value of the Brazilian real down against so many other currencies, “it’s a good moment … for foreign companies to invest, to buy companies in Brazil,” said João Barbosa, a shareholder in Giraffas and CEO of venture capital firm JBB Par Holding. “For the companies who are selling, it’s a terrible deal, but because of the economic situation in the country, a lot of companies are being forced to bring in partners to survive.” Giraffas, which is 35 years old and based in the Brazilian capital of Brasília, has seen revenue drop and store growth stall. “That ruins all your planning for your cash flow, so you have to bring cash in,” Barbosa said, explaining that Giraffas recently sold part of the company.
Most panelists expect the country to stabilize, both economically and politically, now that former President Dilma Rousseff has been impeached. But they stressed that Brazilians have to start thinking positively about the future. “One very important thing in Brazil is that the negativity stops,” said Alexander Wolf (BBA '04), director of agriculture firm Wolf Seeds do Brasil. “For the past two years in Brazil, things have really gone down, and I think that the worst part is the negativity. We went through impeachment, which was quite an experience. … Now that there’s some stability, we can start to look ahead.”
Ric Scheinkman, founding partner and managing director of Sao Paulo-based investment and advisory firm Harpia Capital, agreed with Wolf. “We’ve moved a chapter,” he said, earning nods from other panelists.
But, Claudio Luiz Lottenberg, president of the Brazilian hospital Sociedade Israelita Brasileira Albert Einstein, cautioned that Brazil’s laws need many changes to make the country competitive and stable in the long-term. More important that new laws, he said, is political reform. “If you’re not going to do the right political reform, those that make the laws are going to have the tools they need to keep doing things the same way,” he explained.
Just before the evening concluded with music and samba dancing (which audience members joined), Yunes noted what was perhaps the night’s biggest lesson: “There is opportunity in bad times, and I hope you learned that here today.”