The Brazilian upgrade to a safe investment place in the world, according to Standard & Poor’s (S&P) risk rating announced on Wednesday (04/30), is seen by Rio de Janeiro’s candidature to host the 2016 Olympic Games as another demonstration of international trust in Brazil. “The investment grade received reinforces the sound path Brazil has been walking through, showing the international trust in the country and in our capacity of attracting new investments and hosting major world events, such as the 2016 Olympic Games and the 2014 Worldcup. We are apt and ready", states Carlos Arthur Nuzman, president of Rio 2016 Candidature Committee.

Standard & Poor’s (S&P) Latin America director, Lisa Schineller, states that the agency decision was based on a set of positive factors of the Brazilian economy. According to the director, the “investment grade” reflects the good level of the economic politics, characterized by a pragmatic attitude, especially concerning the maintenance solid public accounts and freedom for Banco Central (Central Bank) to keep rigorously controlling the inflation. Besides, Schineller highlighted other positive points, such as the high level internal demand, capable of supporting long term levels of growth and improving the distribution of income, and a great effort to keep the investment flow in infrastructure, with the partnership of private entities.

Schineller stated that “the pragmatic economic politics indicates that Brazil has a future stronger perspective of growth that must be sustainable." S&P increased Brazil’s grade from BB+ to BBB-. The agency scale goes from AAA (granted to countries such as the United States, Canada and United Kingdom) up to D (concept for insolvent countries).

Executives and investors expect that businesses in Brazil improve with the inflow of new foreign investments, reduction of financing costs, speedup of mergers, acquisitions and initial public offerings and a larger quantity of private equity transactions. President Luiz Inácio Lula da Silva celebrated the upgrade and said: “It is an achievement of the Brazilian people.” The economic staff of the Brazilian government stated the S&P’s decision is the recognition of the successful economic politics. “Brazil becomes part of the “club” of the most respected countries. And this investment grade is important because it is received at a moment of crisis in the worldwide economy”, said the Brazilian Finance Minister, Guido Mantega. Due to the solid economic politics in recent years, Brazil controls the inflation (around 4% a year), accumulates almost US$ 200 billion of foreign reserves and records a drop in public indebtedness, concerning its Gross Domestic Product, which fell from 50.46% in 2002 to 41.24% in March this year. The economy has recorded positive rates of growth (6.2% in the last quarter of 2007), as well as the productive investments, which ended in 17.6% (gross capital formation on the GDP) in the last quarter of 2007 against 16% in the first quarter of 2006.