NOTÍCIAS

On January 26, Brazil’s state-controlled oil company Petrobras announced that its biodiesel unit planned to triple production of tallow, a form of processed fat from cattle, to 158,000 tons a year, helping establish the country as one of the leaders in the production of fuels from animal fats.
However, the announcement was overshadowed by the corruption scandal that has engulfed the country’s most important company over the past few months. The following day, the oil producer dropped a bombshell on investors by admitting it could not calculate the billions of dollars stolen from the company in an alleged bribery and kickback scheme involving Petrobras executives, its suppliers and top politicians.

The company’s shares plunged on the announcement and any excitement over beef tallow was quickly forgotten.

Analysts say that Petrobras, which is widely respected in the oil and gas industry for the advances it has made in deepwater drilling technologies, is the perfect example of Brazil’s innovation problem.

It has the capacity to become a world leader in several industries, but long-running problems such as corruption, excessive bureaucracy, weak infrastructure, short-termism and misguided public policy mean this potential is rarely fulfilled.

While Brazil last year improved its ranking by three places in the Global Innovation Index, it was still placed 61st worldwide, behind Russia, China and South Africa.

The index, which is prepared by Cornell University, Insead business school and a UN agency, pointed out that Brazil was largely let down by its institutions and its general business environment.

Cynthia Serva, co-ordinator of the Centre of Entrepreneurship and Innovation at São Paulo’s business school Insper, says that innovation in Brazil is often held back by economic instability, poor educational performance and a lack of government incentives.

While consistent economic growth over much of the past decade has allowed for a greater focus on innovation, these advances are now at risk, because of the country’s current political and economic problems, she says.

After growing as much as 7.5 per cent in 2010, the economy is faLorem ipsum dolor sit amet, consectetur adipiscing elit. Sed feugiat turpis at massa tristique sagittis. Curabitur accumsan elit luctus nunc condimentum non gravida ipsum blandit. Pellentesque a ante ac nisl porttitor placerat id ac arcu. Phasellus sit amet felis quis velit sollicitudin pellentesque ac ut dui. Ut sit amet dolor vel risus imperdiet placerat at non nisi. Mauris eu nisl non libero semper ornare ut in neque. Donec semper tellus id magna feugiat at eleifend urna volutpat.cing a technical recession this year for the second year in a row. Meanwhile, the Petrobras scandal threatens to engulf the government of President Dilma Rousseff and her PT party and has even led to calls for her impeachment.

Prof Serva says: “Our fear is that the recent movement [towards greater innovation] ends up being paralysed?.?.?.?The government has much more complex problems to solve right now, so once again we have a scenario of instability that makes companies focus on the short-term.” Brazil’s universities are also not in the position to provide enough academic talent to foster innovation in the country’s industries, she adds.

“They produce many research papers and studies but these are often not directed towards problems in the real world?.?.?.?federal-funded institutions in particular have little contact with the market and they just operate within their own walls.” Academics blame low salaries for forcing them to opt for consultancy work rather than independent research — one reason the country’s universities are not highly ranked internationally.

According to Marco Antonio Zago, president of the University of São Paulo, the region of Latin America and the Caribbean accounts for less than 3 per cent of global investment in research and development, while the US and Europe account for 34 and 25 per cent respectively.

Greater government incentives would also help encourage innovation in Brazil, says Prof Serva. “It seems that fostering innovation is not really part of the government’s agenda,” she says.

One example of government barriers to innovation is the ethanol industry. The country has developed one of the most advanced biofuel industries in the world, producing vast amounts of ethanol from sugarcane. Almost all cars sold in Brazil today can now run on any combination of ethanol or petrol.

However, government petrol subsidies introduced to curb inflation over the past few years have made it very difficult for ethanol producers to compete, prompting a wave of bankruptcies across what should be one of Brazil’s most innovative and successful industries.

There are exceptions to the dismal scenario, says Prof Serva. “Technology industries in Brazil have more space for innovation, because it is a sector that changes so quickly. This means companies have to create products and adapt quickly or they won’t survive,” she says.

Much of the innovation in Brazilian industry has arisen through necessity. The challenge now, analysts say, is to provide the conditions so that companies innovate, not out of necessity, but out of opportunity.

Fonte: Financial Times Online – 25/03/2015