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