Expats lured by Brazil’s booming economy
SAO PAULO, Brazil — It just made sense to be in South America’s economic heart, Jonathan Rosenthal reasoned, no matter that he had been working on Wall Street with some of the investment world’s most heady firms.
The fact was, the United States was in a sustained slump and Europe was tanking, but there were promising opportunities in Brazil. So like a growing number of young, highly educated professionals, Rosenthal made the leap to Brazil’s Wall Street, Faria Lima Avenue, to start a hedge fund that has ridden the country’s economic boom.
With an economy that recently surpassed Britain’s to become the world’s sixth largest, Brazil is offering a sunny and often lucrative alternative to the downcast prospects in the United States and Europe. In a sort of reverse brain drain, foreigners are flocking to Brazil.
The number of foreigners residing in Brazil reached nearly 1.5 million last year, up from 961,000 in 2010, said Paulo Abrao, the government’s highest-ranking immigration official. Work authorizations shot up 32 percent in the first nine months of 2011 compared with the corresponding period in 2010. Americans have led the way, with 7,550 receiving work permits in 2010. In addition, 2 million Brazilians who had been living overseas have returned home since 2005.
“While there is crisis in other countries, we have this phenomenon developing here,” Abrao said. “Employment levels are high, and countries that normally were the destination for Brazilians, like Portugal, the United States and Spain, are now sending people to Brazil.”
Those arriving here clearly have an adventurous streak. But they also made their decision based on pragmatic considerations: Brazil is an emerging economic power whose economy has grown by 4.4 percent a year since 2004. It has also received about $200 billion in foreign direct investment in the past six years.
And despite the formidable red tape for foreign workers, this country of 194 million has an increasingly diverse economy with room for those in finance, engineering, Web design, petro-engineering and other highly technical professions.
“When you’re talking about skilled labor, there’s a huge lack of supply, so as a result if you have the courage to come down to Brazil, or you have the language skills, or you’re Brazilian American, it’s a no-brainer to come down here,” said Rosenthal, 31, who runs Newfoundland Capital Management with a Brazilian partner.
In New York, Rosenthal had a golden career. At 22 he joined Morgan Stanley, and he later worked for one of Julian Robertson’s Tiger Cub funds. But the culture of New York’s financial world can be stiff and closed, Rosenthal said, and he was attracted by the investment possibilities in Brazil and neighboring countries.
Here, Rosenthal said he runs into the executives of big firms at the gym, and he is a cab ride away from 80 percent of the firms on the Sao Paulo exchange. “Those interactions are priceless,” he said. “You don’t get that in New York.”
And then there is the music, the spicy cuisine of northeastern Brazil and the ingenious soccer of the nearby team in Santos, which has had to replace Rosenthal’s beloved New York Jets.
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Expats lured by Brazil’s booming economy