Brazilian investments in foreign countries outstripped inbound ones by 8.5 billion U.S. dollars in 2006 due to major acquisitions, the Central Bank said.

Brazilian businesses invested 27.2 billion dollars abroad in the year, while the country received 18.7 billion dollars in foreign investment. That was the first time that the outbound investments eclipsed inbound ones.

Nevertheless, foreign investments to Brazil recorded the highest level since 2001 when they hit 22.4 billion dollars.

Mining company CVRD alone invested 14.6 billion dollars outside Brazil, as it acquired Canada's nickel giant Inco Ltd. in 2006.

Besides, Brazilian brewery Ambev spent 1.2 billion dollars in acquiring Argentina's beer-maker Quilmes Industrial.

Brazil's biggest private bank Bradesco and textile company Coteminas contributed about 1 billion dollars each in the investments abroad.

Altamir Lopes, head of the Central Bank's economic department, stressed that the unusual flow of investment had nothing to do with the hostile environment to foreign investors in Brazil, but reflected the growing internationalization of businesses headquartered in the country.

Lopes added that he expected that the balance would reverse in 2007, mainly because there is no foreseeable acquisition to be made this year which can match the CVRD deal.

The Central Bank estimates that incoming foreign investments would reach 18 billion dollars in the January- December 2007 period, while outgoing investments would be 10 billion dollars.

(Published by People’s Daily Online, January 26, 2007)