Brazil's Terranova finds Lanka suitable for mega investments

Interview with Terranova Participacoes Ltd Managing Director Prof. Gilberto Moreira. Terranova, a global company based in Brazil, is looking for development opportunities to invest billions of US dollars in mega projects in Sri Lanka. Excerpts of the interview.

Q: Could you tell us something about your company?

Terranova, which means, 'new land', has "In Order of Progress" as its motto.

We are a privately owned Brazilian company, based in Belo Horizonte, State of Minas Gerais, in Brazil. Its principals have over 70 years' experience in the implementation of mega projects.

Our goal in making business is to achieve development at its highest level. Through trustful, respectful and transparent dialogue with shareholders and community, we value ethical behaviour to achieve the growth of our businesses. In our belief, the best way of leadership is by proper example, proactivity, ahead of change and 'can do' attitude. Terranova believes that the sustainable way to create wealth to be shared with the community is through economical development. I am confident to say that our technical knowledge and commercial experience are the key aspects of our company success.

Prof. Gilberto Moreira

We do business because it is our passion. There is nothing more rewarding than to see the prosperity being shared with the community. We believe that the only way of doing long-term business is to respect the environment and protect the welfare of future generations.

Just to be a little specific, Antonio Seabra has 35 years experience in the development and operation of mainstream industries. In the company he worked for most of the time was in charge for an annual budget of few billion USD.

As education background, he graduated as Mechanical Engineer from the Catholic University of Minas Gerais, and took several post-graduation courses in management and leadership. Currently, he runs Terranova as its Development Director.

Prof. Gilberto Moreira has extensive experience of 20 years in the solid fuels business, 13 years in project management of grass root and expansions of mainstream industries and additional seven years in sales and market development. He also worked for several years as a Professor at the Federal Center for Technological Education of Minas Gerais, Brazil. As education background, he graduated as a Mechanical Engineer from the Federal University of Minas Gerais, Brazil, and holds a Master of Science from the Oklahoma State University, USA, and took several post graduation courses in Brazil and abroad. Currently, among other business, as its Managing Director, he runs Terranova Participações Ltd, a developer of mega projects.

Talking about our company, we have also to say that we are very much pleased to have joined the right Sri Lankan partner, Asset Holdings, a group with vast experience in the implementation of large infrastructure development projects in your country.

Q: Could you tell us something about your country?

Brazil was discovered by the Portuguese in 1500 and colonized by them. At this point, I have to mention some point in common between Brazil and Sri Lanka because the Portuguese under the command of Lourenço de Almeida were also the first European to visit Sri Lanka and left here their culture and language.

Geographically, Brazil is the world's fifth largest country by area, over 8.5 million km2, almost 130 times the size of Sri Lanka, and by population, with over 200 million people, we are the largest Portuguese-speaking country in the world. Brazil is a multicultural nation formed by the contribution of people from all over the globe. I am pleased to state that all 200 million feel to be only Brazilian and speak the same Portuguese language.

Brazil is a Presidential Federal Republic and the Federation is formed by the union of 26 states and the Federal District, Brasilia.

Brazil is the world's eighth largest economy by nominal GDP and the ninth largest by purchasing power parity at US $ 2.0 trillion. Founding member of the United Nations, the G20, Mercosul and the Union of South America Nations, Brazil is also one of the BRIC countries.

This year, Brazil expects to produce over four million automobiles and become the fourth major automobile producer in the world. In the agriculture sector, Brazil expects to crop over 150 million tonnes. The country is oil self-sufficient. All this development was made in the last 50 years.

Among many technologies produced in our country, I would emphasize the state-of-the-art automobile multi-fuel technology, with which a single car can run on gasoline, ethanol, gasoline/ethanol (at any ratio) and Natural Gas. Biodiesel technology also is one of Brazil's major projects.

Talking about sports, the most popular one is soccer and in that, Brazil already won the World Cup for five times. In 2014, Brazil will host the Soccer World Cup and in 2016, the city of Rio de Janeiro will host the Olympic Games.

Q: Why did your company decide to invest in Sri Lanka?

Because Sri Lanka has a government determined to develop your country to have wealth and welfare to be shared with Sri Lankans. The courageous action, leadership and determination of President Mahinda Rajapaksa to lead the way to a peaceful Sri Lanka built the foundations for a prosperous future of the country.

Many developed countries in the world search for locations far away from their origin mainly due to economic viability. Of course the political stability and the peaceful operating conditions in the country that you invest in are of paramount importance for long term sustainability.

Sri Lanka is very well positioned geographically. Since the ancient times, merchant ships from the Middle-East, South and East Asia and Portugal used to come here for trading. Sri Lanka has a prime geographic position, in the middle of major raw materials suppliers and markets.

Both our nations have many things in common since a long time ago. The similarities between our nations are many, as our passion for sport, good food, music and life-style. Both our countries have a beautiful nature, which we love and respect. Basically, that is why we are confident in investing in Sri Lanka now.

We would like to be the first Brazilian company to join Sri Lanka to invest in mega projects which will be planned and delivered to achieve sustainable development. We expect to make one of the biggest investments in Sri Lanka without any funding from the Government.

Q: What sort of investment does your company have in mind?

As previously mentioned, we have significant expertise in mainstream industry. Terranova's strategy is to look for mega investment opportunities in other countries with a peaceful environment and economic stability.

We will be looking at new business opportunities which would be attractive and suitable for us to invest.

Also, there may be some important projects Sri Lanka has already planned but not implemented due to lack of funds and resources. We would be interested in studying those projects too.

Once we have all the information on various projects, then we will study and select the most suitable project which will be most beneficial to both parties.

We consider that mega projects are fundamental to improving the welfare of communities and providing the economic boost to a nation.

Our experience is that mega projects will support the improvement of education and assist the development of technology together with flow on economic benefits.

The nature of investment would be in the form of foreign direct investment (FDI), which refers to long term participation typically involving participation in management, joint venture, transfer of technology and expertise and the main advantage to the GOSL will be that GOSL will not be spending a single USD for this project but GOSL will be invited to be a partner at no cost to it.

Q: What are the investment incentives you would be looking for?

Globally, there are wide ranges of incentives available, ranging from tax concessions, preferential tariffs, special economic zones, investment financial subsidies, soft loan or loan guarantees, land or land subsidies, relocation and expatriation of profits, training and employment subsidies to infrastructure subsidies.

While the exact nature of any incentives is a matter for later discussion with the Government, to develop new industries and export projects, access to land and expedited approvals are vital to enable developers to be internationally competitive

Q: Do you work with any local partner?

Yes. As I have said before, our Sri Lankan business partner is the Asset Group. Asset Group is presently involved in many mega development projects in Sri Lanka and we have our utmost respect and confidence in them.

We are very happy and most fortunate to have them as our joint venture partner here.

Q: Any other remarks you deem interesting to be commented?

Currently Brazil is a member of the BRIC countries, an acronym for the economies of Brazil, Russia, India and China, which are nations that are speculated to be by 2050 the major economic powers.

We hope that this mega investment Terranova is planning will be the first brick in the foundation of Sri Lanka economical development to add an "S" in the previous mentioned acronym. So, in the future, there will be not just BRIC, but BRICS. So, as our countries have so many things in common, we would like to commence our business operations in Sri Lanka as soon as possible.