Brazil’s central bank has once again cut its benchmark Selic interest rate as it hopes sharp fiscal reforms will see the country out of one of its worst ever recessions.

The bank said this week it could cut the interest rate by 75 basis points to 12.25 per cent, the second such cut in a row, as part of efforts to improve Brazil’s economy – one which was expected to have contracted by more than three per cent last year.

In positive news for people keeping their eye on Brazil’s forestry investment landscape, the central bank explained in a note outlining its reasons for the cut: “The evidence suggests a gradual recovery in economic activity throughout 2017.”

Brazil’s interest rates are very high for a major economy and cuts to the rate are seen as crucial if the country is to recover from one of its deepest recessions.

The central bank’s rate-cutting strategy began in October after inflation began dropping from a high of 10.7 per cent early last year to end 2016 at 6.29 per cent.

“The committee understands that the convergence of inflation to the target of 4.5 per cent…is compatible with the process of monetary easing,” the central bank said.

The Financial Times reported that a weekly survey by the bank of economists found they predicted inflation would be 4.43 per cent by the end of this year and 4.5 per cent next year.

“The cut was in line with expectations given the country’s floundering economy and rapidly easing price pressures. Looking forward, larger cuts could be in the pipeline if incoming economic data remain weak and if the government continues to make progress with fiscal reforms. Given the poor outlook for the economy, our panel of analysts sees the SELIC rate ending 2017 in single-digits, where it has not been since 2013,” said Angela Bouzanis, a senior economist at FocusEconomics.

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Green energy firm Ecotricity says it will donate up to £50 to a new conservation fund designed to support conservation in England’s woods and forests for every new customer who switches to its service.

The firm, the leading energy firm in the UK, has pledged the money for anyone who signs up to the company’s green electricity and gas using a new Forestry Commission sign-up offer.

The initiative will see Ecotricity partner with Forest Enterprise England, an agency of the Forestry Commission that manages England’s woods and forests.

Ecotricity said thousands of pounds could be raised by the sign-up scheme. It will also give customers switching to its energy service a £10 discount on a Discovery Pass, a membership scheme which offers free parking and other benefits at forests managed by Forest Enterprise England.

Dale Vince, founder of Ecotricity, said: “Trees and forests are really important. Sustainably managed, they can provide vital wildlife habitat, carbon sinks and a great place to visit.

“So to team up with Forestry Enterprise England is something we’re really pleased to be doing.”

Simon Hodgson, Forest Enterprise England Chief Executive said: “Alongside the income we generate from supplying sustainably-grown timber, we look for new business partnerships that offer additional sources of revenue to invest in the nation’s forests we manage.

“The extra funding helps us make them more interesting and exciting places to visit and we can continue with our conservation work. We’ve had great successes over the years including ospreys in north England and purple emperor butterflies in the south.”

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The Common Agricultural Policy may have “shut forestry out” of UK rural policy thinking for years but Brexit offers a chance to change all that, trade body Confor says.

The trade group told a senior minister of Westminster’s negotiating team that a post-Brexit forestry sector could unlock jobs and investment, reduce the impact of climate change and flooding, and provide an array of benefits for wildlife, recreation and leisure.

Visiting a sawmill near Fort William, Robin Walker, Minister in the Department for Exiting the European Union, heard from Confor’s chief executive Stuart Goodall about the issues affecting the country’s forestry and timber sector.

Mr Goodall stressed the importance of the forestry and wood processing sector, which employs almost 80,000 people across the UK and delivers £2 billion in economic value every year.

“I was able to discuss Confor’s emerging thinking on the positive role that forestry can play in a post-Brexit world,” Mr Goodall said.

“As the UK leaves the Common Agricultural Policy, there will be a once-in-a-generation opportunity to design rural policy and funding support that meets local needs.

“The CAP has shut forestry out, but we now have an opportunity to unlock jobs and investment, reduce the impact of climate change and flooding, and provide an array of benefits for wildlife, recreation and leisure.”

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Brazil is battling through tough times and now stands as the “hottest thing in emerging market equity right now”, according to a contributor to Forbes.com.

“Brazil is the best of the BRICs in 2017,” said Kenneth Rapoza, a business and emerging markets writer, drawing on comments from fund managers and financial analysts.

Rapoza argues that lower inflation, an improving economic outlook and other factors were combining to make the largest economy in Latin America a hot ticket.

“[In] 2017 though, Brazil is better than anything else. It’s the “bae” of emerging markets,” Rapoza writes.

“Inflation continues to decline and is now at 5.35 per cent. It’s down from over 10 per cent a year ago. Lower inflation means lower interest rates and lower interest rates is good for stocks, which is why the iShares MSCI Brazil (EWZ) is up 15.44 per cent this year; better than Russia, better than India, better than China.”

But there are still problems. Brazil could see its sovereign rating downgraded, according to Fitch Ratings’ Shelly Shetty, who told Rapoza that a “failure to slow the pace of increase in the government debt burden…could lead to a downgrade”.

“Policy drift and an inability to implement measures that improve the outlook for growth and public finances could as well.”

So while Brazil isn’t fully on the road to recovery, there are very positive signs.

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Brazil’s economy is to pick up in 2017, kickstarting a glut of IPOs in the process in what represents positive news for people keeping an eye on investment trends in the Latin American country.

The Wall Street Journal (WSJ) reports that Credit Suisse Group’s Brazil unit, one of the largest investment banks in the country, forecasts a return to growth for Brazil, which is currently in recession.

José Olympio Pereira, chief executive of the unit, told the WSJ that Brazil’s economy could be growing at a year-on-year pace of two per cent by the last quarter of 2017, while the number of IPOs this year is likely to stand at 10 offerings, going back to the level of 2013.

Over the course of the year, the economy is forecast to grow up to 0.5 per cent, Mr Pereira said.

The past few years have not been kind to Brazil, with a scarcity of IPOs and the economy in serious financial difficulty.

“In 2016, only one company, medical-diagnostic services provider Centro de Imagem Diagnósticos SA, known as Alliar, went through with plans to raise capital through a primary offering of shares on the Brazilian stock exchange,” the WSJ reported.

“The sale, which took place at the end of October, broke a dry spell which had lasted from June 2015.”

In 2007 Brazil saw its highest number of IPOs when more than 60 companies went public. Mr. Pereira said his bank has a good pipeline of businesses for 2017 and said money was still flowing into the country.

“If even during a difficult time money was still coming to Brazil, imagine how it will be with a more favorable environment?” he commented.

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A Scottish firm has won a £14 contract to use satellite data to help protect rainforests around the world, including Brazil’s.

The news will be of interest to people keeping a close eye on efforts to protect vital rainforest as they consider making timber and woodland investments in Brazil.

Ecometrica will help Brazil, Colombia, Ghana, Indonesia, Kenya and Mexico manage and protect around 300 million hectares of tropical forests, STV News reports.

The three-year Forests 2020 project will see the firm’s software used to process, interpret and manage the vast volumes of data being transmitted from satellites already circling the earth.

Dr Richard Tipper, executive chairman of Ecometrica, said: “We all know how important tropical rainforests are to the survival of the global ecosystem, but most people are only just waking up to the fact that we need to use technology to make sure conservation efforts are effective and properly directed.”

It’s hoped that the project will speed up the interpretation of forest satellite information, so they can produce maps and data about specific areas of forestry for the six countries.

Dr Tipper said governments can struggled to obtain information about the scale of deforestation and forest degradation, particularly in large rural areas.

“The nature of this particular project is to try to help six different developing countries improve their national forest monitoring systems,” he said.

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Ireland’s forestry sector is set to double in size and create thousands of new jobs on the back of a €200 million injection programme in what will be positive news for people interested in forestry investment trends.

Newstalk.com reports that the announcement of two new large-scale investment programmes has the potential to create 5,000 new forestry and woodland jobs over the next 10 years.

The programmes will see the European Investment Bank (EIB) and Ireland Strategic Investment Fund (ISIF) back a new initiative from Dasos, the sustainable timberland investment fund, that aims to support €112 million worth of new investment in privately owned forests across Ireland.

This scheme is supported by a €90m long-term loan from the EIB which will be used to upgrade forests and construct or maintain forest roads and walking paths owned by Coillte, the commercial forestry firm. The money is designed to improve management of forests and increase the supply of wood for commercial use.

Fergal Leamy, Coillte chief executive, said the cash injection was great news for Irish forestry.
“In Ireland we have a real competitive advantage in a few key areas – forestry is one of them,” he said. “We grow our trees a lot quicker than anybody else because of our climate and so this investment allows us to do that.

“The money will be specifically used to plant plantations. It will be specifically used to upgrade cycle tracks and recreational facilities throughout the country and the money will allow us to buy new areas and grow our business and buy new land for afforestation.”

EU agriculture commissioner Phil Hogan said he expects the initiative to give an economic boost to the sector.

“More investment in any sector of course should ultimately lead to more jobs notwithstanding the improving technology,” he said.

“But I would hope – as the figure that was mentioned today – that 5,000 new jobs could be created.”

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Norway has announced a $400 million fund, backed by food firms Unilever and Nestle, to help stop deforestation in Brazil.

The Local reports that the country announced the scheme at the World Economic Forum (WEF), held recently in Davos, Switzerland, saying it wanted to help reform small-scale rainforest farming – one of the leading contributors to deforestation in Brazil.

Figures from the WEF show around 2.3 million square kilometres of rainforest were cut down between 2000 and 2012.

According to the WWF, without tropical rainforests the greenhouse effect would likely be even more pronounced, and climate change may possibly get even worse in the future.

Importantly, the fund, which also has support from Carrefour, Marks & Spencer and Mars, will be designed to help rainforest countries meet their commitments under the UN’s Paris Climate Agreement, the deal signed in 2015 to curb global warming.

“The future of the planet depends on our common ability to both protect and restore forests at unprecedented scale,” Norway’s prime minister Erna Solberg said in a statement.

“We applaud the fund as we are a strong believer in governments and companies working together to protect the environment while feeding the world,” said Everton Lucero, Brazil’s junior minister for Climate Change.

The fund will be launched with a commitment of $100 million from the Norwegian government and $35 million from Unilever. It is hoped the private sector will help it reach $400 million by 2020.

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Confor has welcomed new Scottish government plans to increase its annual tree planting target from 10,000ha to 15,000ha by 2025 – a growth from around 22 million to 33 million trees every year.

Confor described the news – revealed to the Scottish Parliament as part of the Scottish government’s draft climate change plan as “enormous ambition” for the forestry and timber sector.

The new targets are: 12,000ha hectares of new woodland from 2020-21 (around 26.5 million trees); 14,000ha of new woodland from 2022-23 (just over 32 million trees); 15,000ha of new woodland from 2024-25 (about 33 million trees).

The government also revealed plans to increase the use of Scottish wood products in construction from the current level of 2.2 million cubic metres to 2.6 million cubic metres by 2021-22 and 3 million cubic metres by 2031-2.

“It is great to see such enormous ambition for forestry and timber displayed by the Scottish government,” said Stuart Goodall, chief executive of Confor.

He said the announcements show how forestry and timber can deliver rural jobs and play a major part in reducing carbon in the atmosphere.

“I am delighted that the potential for the greater use of timber in construction has also been identified,” Mr Goodall added.

“Off-site timber construction can play an increasingly significant role in providing the tens of thousands of warm, high-quality and sustainable homes that Scotland needs.”

The Scottish Parliament will host a debate on how to deliver on its ambitions for forestry on January 24.

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Uber invests R$200m in Brazil

January 24th, 2017

App-based taxi service Uber is to invest R$200 million ($63 million) in Brazil to set up a new tech support centre in São Paulo.

The news, of interest to anyone following investment trends in the Latin American country, will see the firm employ thousands of staff to deal with technical requests from its drivers and customers.

The transportation services company’s investment in its Brazilian business will drive the expansion of the centre, which recently started operations.

The facility will employ 2,000 people in the short-term, of which 700 staff will be hired directly by the company with the remainder supplied by outsourcing partners.

By the end of 2017, it is thought that 7,000 people will be employed at the new tech support centre.

“Our goal is to improve technical support for users as well as for driver partners all over Brazil. 24-hour support, which analyses requests on a case by case basis will continue to be carried out through the app,” the company said in a statement.

Uber currently has approximately nine million users registered across Brazil.

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Brazil is to restore 22 million hectares of its land in what has been described as “the largest restoration commitment ever made by a single nation”.

By 2030, Brazil’s government plans to rehabilitate 12 million hectares of forest currently classed as degraded or deforested, with the restored land used for crops, managed forests and pastures.

Brazil announced the plan at a biodiversity conference in Cancun, Mexico recently.

“We are a country of forests,” said Rachel Biderman, director of the World Resources Institute in Brazil. “The national strategy for the restoration of forests and degraded areas positions Brazil as one of the global leaders in the development of a forest economy.”

“Brazil is once again demonstrating global leadership with its ambitious restoration announcement in Cancún,” Biderman added.

“Restoring 22 million hectares—an area larger than Uruguay€Š—€Šwill absorb huge amounts of greenhouse gas emissions, generate clean and plentiful water, and boost agricultural productivity.”

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The UK’s forestry minister has said she is confident 11 million trees will be planted by 2020, despite concerns from the woodland industry that this target will be very difficult to meet.

While giving evidence to a recent Environment, Food and Rural Affairs (Efra) Committee inquiry into forestry in England, Dr Coffey said she thought the 11 million trees target would be “comfortably hit” during the lifetime of the 2015-2020 parliament ,

But trade body Confor has calculated it will take until 2027 for this to happen.

“2010-15 saw an increase in tree planting on the previous five years, but we have seen a drop since we moved to the new Countryside Stewardship scheme, introduced last year – but in the second round of applications, we have seen an increase,” Ms Coffey told Efra.

The introduction of the £1m Woodland Creation Planning Grant and the £19 million Woodland Carbon Fund – both following requests by Confor – would make a real difference to planting figures, she told the committee.

“[There were] complaints about complexity on approvals but that’s working better,” the Minister said. “I’m confident we will be planting more trees and comfortably hit the target we set ourselves by the end of this parliament.”

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Brazil slashed its interest rate with a larger-than-expected cut this week as the country’s government continues to try and stimulate its flagging economy.

In news to be welcomed by people interested in forestry investment in Brazil, the central bank’s nine-member monetary policy committee unanimously voted decided to cut the benchmark Selic rate by 75 basis points to 13 per cent.

The move, following two straight cuts of 25 basis-points each, surprised some analysts who had forecast a rate cut of 50 basis points. Only a handful predicted the aggressive easing handed down by the committee.

“The surprise decision could help President Michel Temer breathe new life into the economy amid lingering political tensions, following last year’s impeachment of President Dilma Rousseff, and a corruption investigation involving his own party,” Reuters said in its analysis of the rate cut.

The move, the latest in a line of stimulus measures designed to boost Brazil’s economy, could spur greater confidence among investors looking to put money into the country’s woodland.

In a statement the central bank said it had considered a 50 basis point cut but opted for something more severe, based on disinflation and a stuttering recovery.

“The extension of the cycle and possible revisions of the pace of easing will continue to depend on inflation forecasts and expectations,” the bank said.

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Great news for anyone keeping an eye on Brazil’s fortunes – the country welcomed a record number of tourists in 2016, boosted by the Summer Olympic and Paralympic Games.

Figures from the Latin American economy’s tourism department show 6.6 million international visitors last year as its big-ticket sporting events proved a huge draw.

That number is nearly five per cent higher than the number of international tourists that visited Brazil in 2015, in news bound to be welcomed by people watching investment trends, like forestry, in the country.

Those tourists spent money too: $6.2 billion last year, 6.2 per cent more than the $5.84 billion they parted company with in 2015.

The record visitor numbers is a spot of welcome good news for Brazil, which is currently in recession and trying to pull itself out, with supportive moves and measures being made by its president, Michel Temer.

So who is visiting? Well, Argentinians led the charge, with more than 2.1 million visiting, followed by Americans (600,000). Visitors from Chile, Paraguay, Uruguay, France, Germany, Italy, England, Portugal and Spain were also received.

“We still have a lot to do to benefit in an efficient manner from the image legacy of the Olympic Games,” Brazil’s Tourism Minister Marx Beltrão said in a statement.

Of those who visited Brazil last year, 95 per cent intended to return, according to a survey by the tourism ministry.

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Renova Energia SA, Brazil’s renewable power generation company, is in discussions to sell its wind farm Alto Sertao II to the Brazilian unit of AES Corp for as much as 700 million reais, it has been reported.

Reuters said a source with direct knowledge of the matter confirmed that AES Corp, known as AES Brazil, submitted a formal proposal for the sale last week, with due diligence work also having taken place.

The Alto Sertao II wind farm has been in operation since 2014. It is thought that Renova could also use part of the proceeds to repay debts; the rest may go towards finishing construction of 400-megawatt wind farm Alto Sertao III, which is 90 per cent complete.

After Reuters reported the deal, shares in Renova accelerated, rising 22.5 percent to 7.35 reais.

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The Brazilian state of Sao Paulo is inviting private companies to pitch to run some of its state parks, it has been reported, in what could be good news for people thinking of investing in Brazil’s forestry sector.

Mongabay reports that Sao Paulo governor Geraldo Alckmin has signed a bill turning over the concessions of 25 state parks that represent a large spread of the Atlantic Forest to the private sector.

It means the company will manage and profit from ecotourism and other park activities. Commentators are concerned, however, about the impact on timber exploitation.

Governor Alckmin has assured the public that the 25 state parks are not being privatised. “Privatisation is when we sell something,” he was quoted as saying. “What we want is to make a concession for a time, bring a private partner in to improve maintenance issues, custody, preservation and use.”

NGOs think the move will lead to more deforestation but the government has said it will create a “close relation between people and the green”, Mongabay said.

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More and more countries are sending licensed timber products to the UK under a scheme designed to stop the sale of illegal timber in the EU.

Indonesia’s first shipment of wood licensed under the Forest Law Enforcement, Governance and Trade (FLEGT) scheme is currently on its way to the UK, and many other operators are following suit.

The FLEGT scheme requires that certain timber and timber products imported from partner countries are covered by a licence.

Timber firms including Plaut International, James Latham and Falcon Panel Products say they are excited about receiving the first shipments, due to arrive on January 3rd, the Timber Trades Journal reported.

Brentwood-based Wood International Agency Ltd has also revealed that it will also be placing FLEGT-licensed plywood from Kayu Lapis Indonesia Group (KLI) that is on the first shipment.

Will Lindenberg, Wood International’s director, said the introduction of FLEGT-licensed plywood to the Wood International portfolio only served to further strengthen its offer.

“To have our products included in this first shipment of FLEGT-licensed timber is a proud moment for my company and for Indonesia,” said Buniadi Makmur, marketing director of KLI.

“We understand the importance of proof of legality through the supply chain. To now be able to supply our products with a FLEGT licence will give even greater confidence to our customers that our products meet all legislative requirements.”

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Global sales of softwood are forecast to show growth of nearly 15 per cent for 2016, a significant rise on market expectations.

Data from the Wood Resource Quarterly (WRQ) suggests that as the year draws to a close, worldwide trade in the lumber will have jumped about 14 per cent, some way up from the 1.7 per cent forecast by the World Trade Organisation’s September economic forecast.

Softwood, a wood from gymnosperm trees like conifers, makes up about 80 per cent of the world’s timber production.

TTJ Online reported the growth in trade as being driven by higher demand for wood from the US and China.

Global demand for lumber increased in 2015 (+10.2 per cent) and 2016 (predicted 13.6 per cent rise).

“The slow and steady improvements in the US housing market in 2016 have resulted in both higher production domestically and an increase in lumber imports, with the latter up 3.6% compared to the same period in 2015,” TTJ Online said.

“Prices for lumber surged in late 2015 and throughout 2016, with southern yellow pine prices jumping over 35 per cent in 12 months.”

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Forest operators are being asked to give their views on the current state of the harvesting resource in forests across England, Scotland and Wales.

Forest Research, the research agency of the Forestry Commission, has published details of its forest machinery census, which seeks to gather “valuable data” about forest resources and services in the UK.

The survey, seeks to understand the nature, size and capability of the harvesting resource throughout England, Scotland and Wales.

The anonymous polling will be used to better-target research and training and other support to the forestry sector. With the last census taking place over 10 years ago in 2011, there has no doubt been much change in the sector.

Duncan Ireland, Forest Research’s technical development project manager, said: “The harvesting sector has undergone a great deal of change since the last survey was done.

“Silviculture and market conditions have evolved and the type of machinery used today has responded, becoming more sophisticated and diverse. Efficiency and capacity have also increased.

“Updating our insight about the forest machinery in use today will help us to gauge the strength of the sector and its ability to meet future needs throughout England, Scotland and Wales.

“I would urge anyone who owns or operates forest harvesting machinery to spend a few minutes doing the survey. It will benefit everyone working in the forest harvesting sector.”

The census is online and contains 21 questions. It will run until February 2017, with a report containing the results published in spring 2017.

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The Scottish government has a much better understanding of the importance of forestry to the country’s economy than it has for decades, industry body Confor has said.

Its chief executive, Stuart Goodall, said forestry is now regarded as a”high political priority” with its scale and importance well understood.

After giving evidence to the Rural Economy and Connectivity Committee at Holyrood, Mr Goodall said he was “optimistic” about the £1 billion sector’s future in Scotland, expressing hope the same will happen in England.

Stuart Goodall said: “It was great to hear the committee say that forestry is a priority and that they understand its scale and importance as a significant rural enterprise delivering £1 billion in annual economic value and providing more than 25,000 jobs.”

He added: “I will be giving evidence to the EFRA committee at Westminster on 6th December. We have highlighted the potential for forestry to deliver 7000 new jobs and to reduce carbon emissions in our evidence and in an earlier Confor report – as well as its potential to reduce flood risks, encourage biodiversity and provide tremendous social and recreational opportunities.

“Scotland has really grasped the nettle and understood the wide-ranging benefits of forestry – and we are working hard to ensure that Westminster politicians do the same.”

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