AMBASSADOR SOBEL'S VISIT TO VITORIA - A SEA OF POTENTIAL

UNCLAS RIO DE JANEIRO 000626 SIPDIS SIPDIS STATE FOR WHA/BSC E.O. 12958: N/A TAGS: ECON EINV ENRG PGOV BR SUBJECT: AMBASSADOR SOBEL'S VISIT TO VITORIA - A SEA OF POTENTIAL INVESTMENT OPPORTUNITIES ¶1. Summary: Ambassador Sobel visited Vitoria, the capital of Espirito Santo, on October 25-26, 2007. There he met with Governor Hartung, Mayor Coser and members of the business community, including the American Chamber of Commerce (AmCham). Vitoria is a major hub for international trade and logistics in Brazil (Vitoria's port processes the highest volume of imports and exports in Brazil). Additionally, a close working relationship between the Mayor and the Governor has resulted in an explosion of new infrastructure projects that will be implemented through public-private partnerships under Brazil's Accelerated Growth Program (PAC); making Victoria a potential market for U.S. companies. End Summary ¶2. On October 25-26, Ambassador Sobel met with Espirito Santo Governor Hartung, Vitoria Mayor Joao Coser, and members of the business community, including two of Brazil's multinational companies CVRD and Aracruz. In an October 25 breakfast briefing organized by the AmCham, logistics consultant Marta Ferreira provided the Ambassador an overview of Espirito Santo's largest companies which include CVRD, Aracruz, the National Steel Company (CSN),and Petrobras among others, as well as plans to expand the state's already extensive logistics infrastructure. ¶3. In his meeting with Governor Hartung, the Ambassador expressed admiration for the number of projects planned over the next eight years as part of Espirito Santo's economic development plan ("Project 2025"). Project 2025 includes an expansion of the airport into an international cargo facility, two new supply boat terminals for existing and planned offshore platforms, a new resort, and a new logistics complex at Vitoria Port. Planned investments through 2015 amount to R$55 billion (approximately USD 25 billion). The Ambassador opined that U.S. investors would be very interested in learning about opportunities in the state, and suggested that Governor Hartung accompany him to deliver a short presentation on Espirito Santo at the March 2008 reporting session in San Francisco for Russell 20/20. The Ambassador also suggested that USTDA might be interested in exploring projects for feasibility study grants. (Note: FCS is following up on a possible USTDA visit to Brazil to include Espirito Santo. End Note.) ¶4. The Governor thanked the Ambassador for visiting Espirito Santo, and referenced the visit by former Treasury Secretary John Snow as highly beneficial to the state because it created a great deal of interest and follow-on contacts with the U.S. business and investment community. He shared the surprise felt by members of his party over President Lula's friendship with President Bush and the fact that he has been so open to developing a positive relationship with the United States in the midst of so much anti-Americanism among his peers in other South American governments. Hartung sees this positive relationship as an excellent opportunity to promote increased trade and investment. ¶5. The Governor and the Ambassador also attended a luncheon hosted by the Espirito Santo AmCham. In his remarks, the Ambassador highlighted Vitoria's considerable resources and heightened economic development activities, and possible opportunities to partner with the USG and with Brazilian firms to further Vitoria's economic development. (Note: in a November 7 meeting with the President of the Port of Tampa during Florida Governor Crist's visit to Sao Paulo, the Ambassador suggested that Tampa and Vitoria explore a sister ports agreement. End Note.) ¶6. The Ambassador also traveled to Aracruz for a tour of the cellulose facility, which is currently producing paper, but may soon turn to producing the next generation of lignocelulose ethanol. The Ambassador told his hosts how impressed he was with the facility, calling it one of the best run companies he has visited. Post will look into additional partnerships for U.S. investors and private sector representatives in that state. MARTINEZ