I visited many companies, which are buyers of a leading Turkish manufacturer, in the cities of Sao Paulo and Campinas between October 8th and 11th.
My personal observation about Brazil is that Brazilians are very colorful and warm, and the most important thing in their life is dancing and football.
Information reports, which are prepared for Brazilian companies in all South America countries contain low ratings and low credit recommendations. However, international meetings where ECAs attend have presentations regarding the noncollectable receivables they have in each country. Despite its low ratings, Brazil does not rank among the worst performers.
Like other South American countries, Brazil has a grey economy and political problems. However, some Brazilian companies are very well-established and financially robust. The short term foreign exchange liquidity is not expected to cause a problem for Brazil. Therefore, the major criterion to assess creditworhiness and to do business in Brasil is the condition of the company that is being evaluated.
Here is my two cents: In a long-term investment plan, you must consider the current political and economic situation of Brazil and must be cautious, but I don’t think there will be any serious problems in the short-term receivables from this country.
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