Brazil – Norway Bilateral relations in a new dimension

1. Brazil – NorwayBilateral relations in a new dimension Ambassador Sérgio Eduardo Moreira Lima BNCC, Oslo, February 26, 2008

2. The Brazilian Economy in 2007 • GDP growth of 5.2% (above the Government´s target of 4.5%) • Inflation rate of 4.3% p.a. (under the Government´s target of 4.5%) • Basic interest rate of 11.25% p.a. • International reserves of US$ 177 billion • Exchange rate of R$ 1.80 per dollar at end of year • Trade surplus of US$ 41.5 billion • FDI flows of US$ 34.6 billion

3. Industrial and Agricultural Growth • Industry • Sales in computers expanded 24%, cars 25%, cellphones 32%, trucks 34% and agricultural machinery 42% • Mining, steel manufaturing, oil exploration and durable goods pushed economic growth in 2007 • Expected to perform well in 2008 in view of investments in the PAC • Farming • Rural GDP resumes growth (6.8% in 2007)

4. Brazilian Economic Outlook for 2008 • GDP growth above 5.0% • Inflation rate under 4.5% p.a. • Basic interest rate of 10.75% p.a. (market expectation) • Exchange rate in the range of R$ 1.75 – 1.85 per dollar • FDI flows of US$ 28 billion • Trade surplus of US$ 30 billion • Continued industrial production growth of 5%

5. Some Key Areas • Oil & Gas • Tupi field has estimated reserves of 12 to 30 bnbarrels • Should duplicate known reserves and rank Brazil among 10 largest world reserves • PAC • From 2008 to 2011, R$ 136 bn for investment in new railways, roads, water treatment units and hydroelectric plants • 2/3 should come from private investment, with long term financing by BNDES • Investment grade status

6. Brazil Trade Surpluses(US$ billions) 160 160 137 Exports Imports 140 118 120 120 96 91 100 73 74 80 63 60 58 56 55 56 49 60 48 48 47 40 20 0 1999 2000 2001 2002 2003 2004 2005 2006 2007

7. (US$ billions) INTERNATIONAL RESERVES FEB.08 190 190 170 Increase: over 130 billions 160 150 140 130 120 110 Liquidation of Foreign Debt to IMF 100 90 80 70 mar/06 59,8 60 50 40 30 sep des mar jun sep des mar jun sep des mar jun sep des mar jun FEB 03 03 04 04 04 04 05 05 05 05 06 06 06 06 07 07 08 */ Position at 06/Sep/2007. Source: Central Bank of Brazil

8. 2007 a historical year in bilateral relations • State Visit of President Lula • Visits of the Minister of External Relations, the Minister of Development, Industry and Trade, the Minister of Environment, and 14 governmental delegations • High-level business contacts (´A Meeting of Energy Giants´, CSR Conference, Petrobras, CVRD, Brazil Seminar in Bergen, Breakfast of President Lula with Norwegian CEOs) • Agreements between companies (Petrobras-Statoil) and business federations (CNI-NHO)

9. 2008 follow-up of President Lula’s visit • Visit of Minister Tora Aasland (March) • Visit of Prime Minister Jens Stoltenberg to Brazil with ministerial and business delegation (September) • Visit of Minister Åslaug Haga to Rio Oil & Gas (September) • Visit of Minister Gilberto Gil (November) • Opening of Honorary Consulates in Bergen and Stavanger

10. Bilateral trade flows reach a new record surpassing one billion dollars.

11. Exports to all Nordic Countries increased.Norway kept the position as the main market.

12. Norway as main destination for Brazil`s exports in Scandinavia

13. Norwegian Investment in Brazil

14. ”During my visit to Brazil in 2003, Norwegian businessmen declared that Norwegian investments in Brazil would reach 5 billion US$ in the next 5 years. Today I can confirm that we are reaching this investment level” King Harald V(Sept 13, 2007)”I come to Norway convinced that the present moment opens up new and important opportunities. One of them results from a lasting cycle of sustainable growth in Brazil”President Luiz Inácio Lula da Silva(Sept 13, 2007)