According to the UNCTAD’s World Investment Report, released yesterday, the perspective of economic growth in 2017 (0.3% according to the World Bank and 1.6% according to the OECD) made Brazil move up one position, in relation to 2016, among the world’s preferred destinations for foreign investment.
The mining and automotive sectors are two areas where foreign investment has significantly raised in Brazil, whereas the service sector has experienced a decrease in foreign investment. Also according to the UNCTAD’s report, the economic growth experienced by digital multinational companies has been far superior to that of other multinationals.
With its main legal bottlenecks being its labor and tax systems, Brazil has a labor legislative reform on the way, which promises to simplify employment relationships and ease the burden on employers. Its candidacy as a member of the OECD (made last week and having been well-received so far) may have as a side effect the harmonization of Brazilian transfer pricing rules with OECD standards and, the amplification of the Brazilian tax treaty network.