INSTITUTIONAL INVESTORS LEARNING JOURNEY (IILJ) VISIT TO

UNCLAS RIO DE JANEIRO 000580

SIPDIS

SIPDIS

STATE FOR GREG MANUEL
NSC FOR DAVID MCCORMICK
EB/ESC JAMES EIGHMIE AND NEA
NSC FOR FEARS

E.O. 12958:N/A
TAGS: EINV EFIN PREL BR
SUBJECT: INSTITUTIONAL INVESTORS LEARNING JOURNEY (IILJ) VISIT TO
BRAZIL



1. (U) Summary: From September 9-14, a group of pension and
endowment fund managers, accompanied by Commerce DAS Ana Guevara,
FCS and Treasury Brazil personnel, visited Rio de Janeiro and Sco
Paulo on an Institutional Investors Learning Journey (IILJ). The
IILJ was organized by the Brazilian Venture Capital Association
(ABVCAP) and Brazilian Industrial Development Agency (ABDI),and
supported by Commerce ITA. The group, which represented more than
US$300 billion in alternative asset funds, came to learn more about
the Brazilian market for private equity investing. This visit is a
deliverable under the Commercial Dialogue between Secretary
Gutierrez and Minister Jorge, the next meeting of which will take
place on October 11, 2007 in Brasilia. End Summary


2. (U) The delegation visited Rio from September 9-11. Ambassador
Sobel, who had been in the United States, returned specifically to
accompany the delegation, since this visit was an important
milestone to advance goals set in the Commercial Dialogue by
Secretary Gutierrez and Minister Furlan in June 2006.

SIPDIS


3. (U) In Rio, the IILJ delegation participated in a macroeconomic
briefing by the Treasury Attach, a meeting with Rio Governor Sergio
Cabral, a cocktail hosted by ITA with Rio State Secretaries for
Finance and Economic Development, as well as meetings with the
Brazilian Development Bank (BNDES),the Brazilian SEC, and the
Brazilian innovation agency (FINEP). The Ambassador hosted a dinner
for the IILJ participants, which provided an opportunity for
dialogue with representatives from major U.S. investment banks in
Brazil. On September 11, the group visited the Catholic University
of Rio (PUC) for a briefing on a new business incubation/private
equity initiative and participated in a roundtable with high-ranking
executives from the major Brazilian pension funds.


4. (U) While in Sco Paulo from September 12-14, the delegation
visited the Sco Paulo Stock Exchange (BOVESPA),the Commodities and
Futures Exchange (BMF),and held meetings with asset management
companies. The group also attended presentations on public equity
and private equity investments in Brazil, and concluded its visit
with a meeting with the President of Brazilian Central Bank Henrique
Meirelles.


5. (U) The investors were amazed at the opportunities and rapid
growth occurring in Brazil, and several stated that they planned to
return. There was a great deal of interest in possibilities
presented for private equity.


6. (U) This visit will be presented as a deliverable during the
upcoming Commercial Dialogue between Secretary Gutierrez and
Minister Jorge on October 11, 2007 in Brasilia. We expect to see
an increase in visits by US investors, and an eventual increase in
US investment in Brazil - particularly in private equity - as a
result

MARTINEZ