The great escape: Rio's best-kept secret

Where do the citizens of Rio go to escape the city? They set sail for Ilha Grande – an island idyll with no cars, but plenty of beaches, wildlife and charm, says Ruby Armstrong

Placing your trust in a battered old fishing vessel and a leathery fisherman whose flip-flops are moulded to his feet is but a small leap of faith when bound for an idyllic island. After all, a gently chugging 90-minute boat journey feels like an appropriate method of transport to get to an unknown Brazilian isle: it allows you time not only to acclimatise to a slower pace of life, but also to contemplate what delights might await you.

Ilha Grande, 150km south of Rio de Janeiro, was used as a shelter for pirates and smugglers when the Portuguese first arrived in Brazil, back in the 18th century. Thankfully, access to this laid-back paradise is much safer these days: the island is making a name for itself as a tourist destination due to the extensive Mata Atlantica (Atlantic Forest) that covers much of it. When you arrive in the sleepy harbour of Abraao, the main village, you sense immediately that life moves at a leisurely pace here. This may be partly due to the lack of cars – and, indeed, banks – on the island, but it is more to do with the untouched scenery and absence of high-rise developments.

Beyond the village, a mere 10-minute walk away, the Pousada Naturalia guest house is perched on a hillside, so each room has a stunning sea view. Sunsets don't get better than when seen from your balcony on a gently swinging hammock, with a Brazilian beer in your hand.

Laurent and Henrique, the owners of the pousada, built it with a respect for the environment. Every stone unearthed during the building process has been reused. And the sympathetic way the pousada has been built means that it sits naturally against the hillside. There is, however, a gentle nod to creature comforts: the ample rooms all have air-conditioning and piping-hot showers (thankfully, there's not a TV in sight), and eight out of the 12 rooms have solar-powered water heating. Breakfast is taken in an open-sided "room" in the lush tropical garden, where hummingbirds drink from the hanging feeders and butterflies flutter in and out. A vast array of local fruits is laid out – from the smallest, sweetest bananas to jackfruit – and each day a surprise treat is produced from the kitchen: a lemon mousse one morning, fresh banana loaf the next.

Inspired by the enthusiastic directions of our hosts, we launched ourselves on an "easy two-hour walk" to the Lopes Mendes beach. The trail wound up and over steep rainforest hills, and along deserted pristine beaches.

Many of the 16 trails on the island were originally used by the Tupinamba Indians, the first recorded residents on Ilha Grande. Instead of their previous use – as a means of hunting and survival – they now lead visitors towards indulgence and relaxation. A combination of jet lag, an 11am start, and the heat meant that we arrived at the beach later than expected. But it was worth it. Before us stretched over 2km of pure white sand fringed by shady trees, and sea the colour of jade. Ilha Grande does beaches very well. Indeed, even if you chose a different beach each day, it would still only provide the merest of peeks at the 100-plus on offer.

Abraaozinho beach is a good spot (and a more manageable 20-minute walk eastwards from the pousada). But an even better way to visit a few beaches in one day, and see the coastline, is to charter a sailing boat, or join one of the many organised boat tours leaving the harbour each day to the areas not accessible by foot.

Boat tours are a popular among Brazilians, in particular the Cariocas – the citizens of Rio. They arrive for the weekend armed with beer and accompanied by extended family, grandparents included. Itineraries often include stop-offs at a lagoon, scuba-diving or snorkelling and fishing, with lunch served either on board or in fish restaurants on the shore.

After a hard day's work, small groups of fishermen congregate in the small main square of Abraao to play cards, beer in hand. Their catches find their way on to the tables of restaurants and cafés, in dishes such as the hearty bobo de camarao – a fish stew packed with seafood in a thick sauce made with manioc paste, a Brazilian staple. Lighter dishes include barbecued fish or meat, known as churrasco, with rice and vegetables.

For a body-conscious, beach-loving nation, the Brazilians love their desserts. Every night, two wheelbarrows, each carrying an enormous refrigerated glass container overloaded with treats, is set up at each end of the square. Huge passion-fruit cheesecakes, oozing chocolate cakes, and fudge balls with a caramel centre were just some of the goodies on sale. The less calorific option involves a short stroll to one of Abraao's ice-cream bars, where unusual flavours such as acai berry can be sampled.

If you do indulge in the sweet trolley, the sure-fire calorie burner is a guided trek to the 982m peak of Pico Papagayo ("parrot peak"), the beak of which can be seen poking out of the rainforest from anywhere in the village. Having learnt our lesson, we forced ourselves to leave the pousada at the break of day in an attempt to avoid most of the roasting heat. We knew it would be tough (it's rated the hardest climb on the island), but having broken ourselves in with a few easy hikes – and by emphasising that we were on holiday to our guide – we got there in the end. The views were outstanding.

Another option is the five-hour round-trip to Saco do Ceu ("bag of the sky") beach, so called because the water is so still at night that the stars are reflected on it. A short detour takes you to a waterfall called Cachoeira da Feiticeira ("witch's waterfall"); and on the beach itself there are plenty of seafood restaurants. Pirates used to hide out in this idyllic spot, but these days, less hostile, more glamorous sailors use it as a stop-off before heading to the crystal-clear waters of the Lagoa Azul (Blue Lagoon).

Rio's best-kept secret rewards those who are prepared to take that first small leap of faith.

http://www.independent.co.uk/travel/americas/the-great-escape-rios-bestkept-secret-837128.html

Brazil Leads World Stock Markets as Valuations Spur Downgrades

Brazil extended its lead over the world's biggest equity markets in May, pushing prices to the highest level relative to earnings in four years and prompting analysts to cut ``buy'' ratings to the fewest since December.

The Bovespa stock index gained 12 percent this year, the steepest advance among the 20 largest markets, on record prices for the nation's iron-ore and oil and rising economic growth forecasts. The Standard & Poor's 500 Index, Japan's Topix, the U.K.'s FTSE 100 Index and China's CSI 300 all fell in 2008. The Bovespa jumped 5.8 percent in May, third behind the 14 percent rise in Russia's Micex Index and 6.1 percent advance in Argentina's Merval Index.

The Bovespa's climb pushed its average valuation to 16.8 times earnings, 61 percent above the level three years ago. Brazil's central bank raised interest rates last month for the first time in almost three years, while the percentage of analysts who recommend buying Brazilian stocks fell to 54.9 percent from 57.5 in April, data compiled by Bloomberg show.

``Brazil's been a great-performing market for quite a while but now when we look around the world we perhaps see more interesting earnings growth and valuations,'' said Deborah Medenica, who oversees $20 billion in emerging market equities at AIG Investments in New York. ``It doesn't make Brazil an unattractive market, just not as attractive as it has been.''

The Bovespa traded for 17.3 times its companies' average earnings on May 19, the highest since September 2004, according to data compiled by Bloomberg. The S&P 500, the benchmark index for American equity, trades at 23.4 times earnings. The MSCI World Index of 1,934 developed-market companies trades at an average 16.6 times profits.

Petrobras Rally

Petroleo Brasileiro SA, the state-controlled oil company, led the Bovespa's advance as Nymex crude futures rose to $135.09 on May 22, the highest since trading began in 1983. Rio de Janeiro-based Petrobras climbed 42 percent from its March low and surpassed Microsoft Corp. as the sixth-biggest company by market value.

Cia. Vale do Rio Doce, the world's biggest iron ore producer, jumped 21 percent since its March 20 low. The Rio de Janeiro-based company reached an agreement with ArcelorMittal, the world's largest steel producer, to increase charges for iron- ore 65 percent. Vale's price-earnings ratio rose to 16.5 on May 19, the highest in at least two years.

Brazil became the best-performing market April 30 after S&P raised its long-term foreign currency debt rating to investment grade for the first time. Four months earlier, Brazil became a net foreign creditor as demand grew for its metals, sugar and soybeans. Fitch Ratings upgraded Brazil's foreign-currency debt to investment grade yesterday.

`Most Attractive'

``It's still one of the most attractive markets in the world,'' said William Landers, who oversees $8.2 billion in Latin American stocks at BlackRock Inc. in Plainsboro, New Jersey. ``Brazil is still able to grow very well with high interest rates. You can kind of look at Brazil and see a steady 4 to 5 percent GDP grower for almost a decade.''

The median expectation for 2008 economic growth in Brazil increased in the last three weekly surveys of 100 economists by the central bank, rising to 4.7 percent from 4.66 percent. In the first week of the year economists expected 4.5 percent growth, according to the survey.

The Bovespa slipped 1.9 percent to 71,797.54 yesterday. The Dow average rose 0.4 percent, while the S&P 500 Index advanced 0.5 percent.

Higher Rates

Prospects for higher interest rates prompted some analysts and investors to turn more bearish on Brazil. The benchmark lending rate may rise to 13.5 percent this year, according to the median estimate in the central bank survey published May 26, higher than the 13.25 percent estimate in a poll earlier in the month.

Deutsche Bank AG cut its rating on Brazilian shares to ``neutral'' from ``overweight'' in a report dated May 21 on concern higher interest rates and reduced demand from China will slow economic growth.

Wagers that Petrobras American depositary receipts are overvalued jumped in the first two weeks of May to the highest level in seven months, according to Bloomberg data. Short interest, a gauge of bets against a stock, rose to a ratio of 2.64 percent, the highest since the last two weeks of September, the data show. Short sellers sell borrowed shares with the expectation of replacing them at a lower cost.

Petrobras' Sao Paulo-traded shares fetch 17.8 times earnings, more than twice its monthly average during this decade. Vale's ratio is 40 percent higher than a year ago.

``With Petrobras and Vale, we're a bit mindful at these levels and we've reduced holdings,'' Alexandre Vianna, who helps manage the equivalent of $7.2 billion in Sao Paulo at Suladis DTVM, a unit of SulAmerica Investimentos. ``But this is in the short-term. The future here holds a very good story.''

http://www.bloomberg.com/apps/news?pid=20601086&sid=aGm5lxp8T3Ew&refer=news

Brazil: Hidden Pousadas - Pousada Vivenda, Rio de Janeiro

Pousada Vivenda is a dream come true for owner John Hudson. Not only is his eye for design evident everywhere, but also his belief in offering quality, comfort and personal service at all times. The result is a rustic-chic style, with exuberant tropical touches. Although not in the historical centre of Paraty, this has its own advantages. Most of the action is a nice safe 10 minute walk away, along the river, and the pousada, in turn, is wonderfully tranquil.

Vivenda is very small with 2 chalet-type self catering bungalows and one double suite, spread around a delightful swimming pool and bar. Add some gentle background Brazilian jazz to the very personal service and intelligent conversation with John and other guests, and the impression is that you are at a very informal, yet sophisticated, house party. Wonderful!

Paraty

Paraty is a world heritage site, a beautiful cobbled colonial town, with a traffic-free historical centre. Outside festival season at least, it appears to have stopped in time. The original inhabitants were Guaiana Indians, but the present town was founded in 1667.First famous for its sugar mills and its cachaca (sugar cane liquor) production, Paraty really came of age during the gold cycle of the 17th and 18th centuries, when the Caminho do Ouro (Gold Trail) was built. This opened up the interior of the country and more importantly gave the state of Minas Gerais access to the sea. It was through the port of Paraty that much of the gold and precious stones from Minas passed on their way to Portugal.

If Paraty is as well preserved as it is, much is due to its economic isolation in the 19th century, courtesy of the rather efficient pirates hiding out on the neighbouring beach of Trindade, who effectively forced merchants to find different ports. However another reason was the difficulty of access before the 1970s when the coastal road, Rio/Santos BR101, was built. In the last 25 years local tourism has grown substantially and the number of pousadas runs into hundreds, located both inside and outside the historical centre. Many of the original colonial buildings have been refurbished and now house craft shops, restaurants and bars, with live music in the evenings.

Not to be missed

- The journey from Rio to Paraty (one of the most scenic in the world)

- Schooner trips round the Ilha Grande Bay

- Walking tour round the historical centre of Paraty

- Walking the Caminho do Ouro, the 17th/18th century gold route

- Shopping for handicrafts, rugs, hammocks, wooden boxes, art, cachaça

- Festivals: Literary (July); Pinga (August); Gastronomy (November)

Getting there without a car

The easiest way is to get the bus from the Novorio bus station in Rio using the Costa Verde bus company. The journey takes 4.5 to 5 hours with a short stop roughly half way. There are usually around 6-8 buses a day in each direction.

From the bus station to the pousada is a 10 minute walk or a 5 minute taxi ride - fixed price R$10 (for anywhere in Paraty).

http://www.gringoes.com/articles.asp?ID_Noticia=2133

Brazil launches US$5 billion program to build ships and oil rigs

Brazil on Monday announced plans to spend at least $5 billion to develop deep water oil finds, building new ships and hiring rigs as soaring world fuel prices boost demand for drilling equipment.

State-run oil company Petroleo Brasileiro SA, or Petrobras, will spend $5 billion to build 146 ships and plans to hire 40 deep-water drilling rigs and platforms, President Luiz Inacio Lula da Silva told shipbuilders in Niteroi, a harbor town near Rio de Janeiro's coast. Analysts said the additional equipment could cost an extra $15 billion.

Petrobras has made a series of large offshore oil finds in the nearby Santos Basin, including a possible 8 billion barrel discovery at the Tupi field in November — the biggest in the Western Hemisphere since 1976.

But as global oil prices soar, competition for equipment to tap that oil is increasing. Petrobras now leases nearly 80 percent of all deep-water drilling vessels in the world, according to local media reports. A Petrobras spokesman declined to confirm that figure or give his name, citing company policy.

The plan to modernize Petrobras' own fleet would employ about 8,000 shipbuilders, at least 70 percent of them Brazilian, and would require an additional 3,800 crew members once the ships are complete in 2017, Petrobras said in a statement.

Silva noted that Brazil's naval industry has grown more than 20 times since he took office in 2003, from 1,900 to 40,000 workers today.

Petrobras, which Silva said has become the world's sixth largest company, announced last week that it had discovered new medium-grade crude deposits in the Santos Basin at a depth of 4.2 miles (6.8 kilometers). It did not estimate the size of the find.

Deep underwater layers of sand, rock and salt make extraction expensive.

http://www.iht.com/articles/ap/2008/05/26/business/LA-FIN-Brazil-Ship-Building.php

Slumming It

Expect to hear the word "poorism" in the future, as modern travelers flock to the developing world's slums and shantytowns, which could soon house one-third of humanity. Author Robert Neuwirth, who lived in and studied these settlements for two years, calls them the "cities of tomorrow."

The proliferation of "slum tours"—part of a growing trend dubbed "poorism" by some—could signal a new interest in learning how people live inside the many favelas, barrios or shantytowns around the planet. Journalist Robert Neuwirth, author of "Shadow Cities: A Billion Squatters, A New Urban World," argues that these communities might be the "cities of tomorrow." Neuwirth spoke with NEWSWEEK'S Ana Elena Azpurua about these settlements and his experience living in Rocinha (Rio de Janeiro), Kibera (Nairobi), Sanjay Gandhi Nagar (Mumbai) and Sultanbeylu (Istanbul).

What prompted you to leave New York to live for two years in different shantytowns around the world?

Robert Neuwirth: In aggregate, squatters are the largest builders of housing on the planet. They are more important for the future of the world than any developer or any government. To me, as a reporter, that's a story.

Why do you think these communities are the "cities of tomorrow"?

No one is building for these people, so they build for themselves. They create urban neighborhoods that, when they have the stability to stay for a while, are every bit as good as the urban neighborhoods in the legal city. In many countries in the world, like parts of Asia and Africa, squatters are a majority in the city.

But the quality of life is far from ideal in these communities.

I believe that these neighborhoods are the neighborhoods of the future. That doesn't mean that they have to stay without public services. It means that we have to find a way of bringing public services into these communities.

How do you think governments or outsiders can help them?

If you go talk with the squatters, they'll tell you, "We want water, we want electricity, and we are willing to pay for it." It is not a question of lack of resources, it is a question of governments not wanting to invest the time and energy and perhaps the money they are diverting for other things. It is not a difficult thing to do. We have the technology to bring water to a community. It is called water pipes, and it is used all over the world.

In your book you mentioned that people have an animosity toward these communities of squatters. Why do you think this is the case?

I'm not sure why. Some of it is based on disinformation. Once I was in the center of Rio de Janeiro at night and I took a taxi back to Rocinha because at that point the buses were not running. It was right around New Year, and everywhere in the city people were lighting fireworks, but my taxi driver thought it was gunfire just because we were in Rocinha. The image of the squatter community that is perpetuated is one of lawless people who shoot guns every day.

What else perpetuates that image?

There is also a lack of knowledge and economic opportunity. No one really engages these communities, so they don't really know who these people are. The economic system conspires to keep them that way. For example, in India people consider the squatters criminals, but they hire them to cook, to drive their cars, to pick up their kids at school, to raise their kids, to clean their houses. How can you have it both ways? Hiring these people at incredibly low wages to do all these household tasks for you but, when they amass, you deride them as criminals.

What was the most important lesson you got from living in these settlements?

The first thing is that squatters are not different from anyone else. They desire to be part of civil society. They want to work with the government, receive concrete benefits and improve their communities. They love their communities. The second lesson is that if we want them to get better and improve, we have to work with the people that are living in these neighborhoods.

What do you think of the "slum tours"?

I have mixed feelings. On one hand I understand the impulse. It is commendable that people want to see the reality of the country they are visiting. On the other hand, I do feel like driving through in a jeep as if somehow you were on a wild animal safari is overdoing it. It is not the way you should meet people. At a personal level, it was very funny that I would be eating lunch at a restaurant in Rocinha and the jeep tour would come through. I thought that if these people taking photographs only knew that the kid they are photographing in the pizza place is from Brooklyn, N.Y., it would break their image of what these communities are like.

What would be a better way to get to know these communities?

If you are staying in a hotel and you get to talk with the staff, you might find that the staff person says, "Why don't you come and visit me, if you are interested?" That seems to me a more legitimate way to go into these communities. You'd probably end up learning more because you really visit a person, rather than just driving through in a large four-wheel vehicle.

Did you at some point feel like you had become an insider?

Oh, yeah. People were amazingly welcoming. Now, I'll be honest, part of that feeling is false, because I'm not a squatter and I could always leave. I had the ability to keep one foot in both worlds, and I was always very conscious of that. But I was welcomed completely into every community, and that transcended language, economics and race.

http://www.newsweek.com/id/137980

Petrobras beats Microsoft in market value

Brazil's state-owned oil and gas company Petrobras has become the third "most valuable" company of the Americas, ahead of Microsoft, consulting firm Economatica said Monday.

Based on the price of its stocks on Friday, Petrobras' market value was estimated at 287.2 billion U.S. dollars, while Microsoft's was at 279.3 billion U.S. dollars.

Economatica said Petrobras' preferential stocks had risen over 110 percent and Microsoft's dropped 3.5 percent in the past one year.

The performance of the Brazilian oil and gas giant was attributed mainly to the discovery of huge deep-water fields that could convert the company into one of the 10 biggest oil and gas producers in the world.

U.S. oil giant Exxon Mobil topped Economatica's list of the American continent's biggest companies, with a market value of 489 billion U.S. dollars, followed by General Electric at 320 billion U.S. dollars.

Apart from Petrobras, other Latin American companies such as Brazilian miner Vale and Mexican telecom company America Movil were also on the list.

http://news.xinhuanet.com/english/2008-05/20/content_8212987.htm

More bounty

Could Brazil become as big an oil power as it is an agricultural one?

OF ALL the commodities Brazil exports, oil has long been an afterthought. Its oil reserves were reckoned to be relatively modest: about 12 billion barrels at the beginning of 2007, according to BP, or about 1% of the world's total. But last year, Petrobras, Brazil's partly state-owned oil firm, announced the world's biggest oil discovery since 2000: the Tupi field, which it hopes will produce between 5 billion and 8 billion barrels. Now the head of Brazil's National Petroleum Agency (ANP) says another nearby discovery might hold as much as 33 billion barrels, which would make it the third-largest field ever found. That alone would be enough to raise Brazil to eighth position in the global oil rankings—if these estimates are correct.

The ANP, which regulates Brazil's oil industry, was quick to distance itself from the remarks of its boss, Haroldo Lima. He spoke personally, not officially, it said, and reflected past reports in the media. Petrobras and its partners, BG of Britain and Repsol-YPF of Spain, said that they needed more tests to determine exactly how much oil it contained.

But no one dismissed the estimate as preposterous. That, plus the fact that a senior official had given credence to such a dramatic number caused the shares of the three firms to jump, despite the fact that Mr Lima claims he does not even know where the stockmarket is, and certainly did not intend to influence it. At one point, Repsol was up by 14%.

Both Tupi and the field mentioned by Mr Lima, Carioca-Sugar Loaf, lie beneath a thick layer of salt that is some 800km long and 200km wide. José Sérgio Gabrielli, Petrobras's boss, has hinted that there are vast reserves of oil to be found in this “pre-salt” formation. At any rate, Petrobras has struck oil every time it has drilled there. The firm's head of exploration says “there is practically no exploratory risk” in the area. Dilma Rousseff, its chairman, has breathlessly declared that Brazil will soon be on a par with Venezuela or Saudi Arabia.

The government must be thrilled at the prospect of the revenue from the new fields. But they will take many years and huge sums to develop (drilling a single well at Tupi cost $240m). And the extra income may also accentuate many of the weaknesses of the Brazilian economy—including a strong real and an overweening public sector.

http://www.economist.com/displayStory.cfm?story_id=11049391

The Country of the future finally arrives

Sitting in his air-conditioned office in Guarantã do Norte, a remote agricultural town on the edge of the Amazon rainforest, local mayor José Humberto Macêdo looked a contented man.

Thanks largely to the global boom in commodities, this soya-growing region has been transformed into the vanguard of Brazil's march on to the world stage. "This is going to be the new Brazil," Macêdo beamed, explaining how ballooning commodity prices had made his region, Mato Grosso state, into a powerhouse of the Brazilian economy.

Across the country, similar optimism can now be heard among businessmen and politicians, all convinced that South America's sleeping giant is finally waking up. Brazil has long been known as the país do futuro (country of the future). But a series of economic and political crises and 21 years of military rule somehow meant the future never quite arrived.

Now things seem to be changing. Brazil's currency recently hit a nine-year-high against the dollar, inflation is under control and millions of Brazilians are being propelled towards a new middle class. Last week, meanwhile, Brazil was awarded "investment grade" status by the financial rating agency Standard & Poor's, sending the country's stocks soaring to an all-time high.

Following the announcement, Brazil's president, Luiz Inácio Lula da Silva, said: "If we translate this into a language that the Brazilian people understand, it means that Brazil was declared a serious country, that has serious policies, that takes care of its finances with seriousness and because of this we deserve international confidence."

From oranges and iron ore to biofuels, Brazilian exports are booming, creating a new generation of tycoons. Brazil's millionaire club grew from 130,000 in 2006 to 190,000 last year - one of the fastest rates in the world, according to a study by the Boston Consulting Group.

"We are the biggest exporters of meat, coffee, sugar, fruit juices and the second biggest of grains," Brazil's agriculture minister, Reinhold Stephanes, boasted at a conference in Brasília last month.

Meanwhile, Brazil's stockmarket, known as the Bovespa, was one of the best performing in the world last year.

Despite the world economic crisis, the Brazilian government recently raised the projected growth rate this year to 5% - lower than the other so-called BRIC nations of Russia, India and China but impressive for a developing country.

"The future has already arrived," said David Fleischer, a political scientist at the University of Brasília. "Foreign investments coming into Brazil are very strong; inflation is more or less under control; Brazil now has more international reserves than foreign debt, and the commodities are booming."

Not to mention the oil. A series of huge offshore discoveries by the state-owned energy company Petrobras has led many to dub the president "Sheikh Lula" and claim that Brazil may soon become a major oil producer.

In April, when Haroldo Lima, head of Brazil's national petroleum agency, made headlines after claiming that another huge oilfield had been found off Rio's coast, the news appeared to confirm what many Brazilians have long claimed: God is Brazilian.

Lia Valls, an economist at Rio's Getulio Vargas Foundation, said: "We are now living a singular economic situation we have never experienced before. The international situation is very favourable to Brazil."

In February, when the government announced that it had paid off its foreign debt, Lula boasted that Brazil had "taken an extremely important step towards transforming itself into a country taken seriously in the financial world".

"We will transform this country, definitively, into a great economy and a great nation," the president added.

Keen to transform itself from developing nation to world power, Brazil is also presiding over a 1,200-strong UN stabilisation force in conflict-ridden Haiti. Paulo Cordeiro, the country's former ambassador in Port-au-Prince, said the presence of Brazilian troops was a "demonstration of Brazil ... wanting more responsibility.

"I think Brazil has already reached a certain level of development in which the international community starts calling on it to act more," he said.

"Brazil's international leadership has grown a great deal over the last six or seven years," said the University of Brasília's Fleischer, citing Brazil's involvement in the UN mission and its leadership of the emerging nations in the Doha talks. "The tendency is for this influence to keep growing."

For analysts, much of the euphoria sweeping Brazil is down to the ability to control the inflation that plagued the country in the late 1980s and early 1990s. In 1993 inflation reached 2,490%. Today the figure stands at about 4.7%.

"I think now it is difficult to imagine a return to this," said Valls.

Analysts are less certain, however, about the effects that a drop in commodity prices might have. Many believe this could bring a dramatic end to Brazil's boom. Others question whether the infrastructure and education systems are strong enough to maintain the economic momentum.

Valls warned: "All this does not mean you are guaranteed economic growth. Brazil still has serious structural problems; there needs to be lots of investment in infrastructure. There are some serious pitfalls that compromise this growth: education, having a qualified workforce, health."

http://www.guardian.co.uk/world/2008/may/10/brazil.oil

Petrobras Finds Make Stock Most Expensive Oil Company

The biggest oil discovery in the Western hemisphere in three decades and speculation about an even larger deposit turned Petroleo Brasileiro SA into the world's most expensive energy producer.

Petrobras, as the company is known, trades at 17.2 times profits after rallying 87 percent in the past year. The shares are twice as expensive as Russia's OAS Lukoil and Royal Dutch Shell Plc of the Netherlands, and 50 percent more than Exxon Mobil Corp., as investors focus on the Rio de Janeiro-based company's oil finds rather than its falling profits.

``You just never know when they're going to make the next announcement,'' said William Landers, who oversees $8.2 billion in Latin American stocks at BlackRock Inc. in Plainsboro, New Jersey, including shares of Petrobras. ``You don't want to be on the wrong side of that trade.''

The Brazilian government's controlling stake in Petrobras may add to the stock's allure on speculation the company will get favorable treatment in exploiting oil. President Luiz Inacio Lula da Silva's administration pulled 41 exploration licenses from an auction after Petrobras found the Tupi oil field Nov. 8, a discovery that caused the stock to jump 14 percent, the biggest rise in nine years. Tupi, 155 miles (250 kilometers) off Brazil's coast, may have 8 billion barrels of recoverable oil.

Petrobras shares rose another 5.6 percent on April 14 after the head of Brazil's oil agency said the offshore Carioca prospect may hold the equivalent of 33 billion barrels of crude, large enough to be the world's third-biggest field. Chief Executive Officer Jose Sergio Gabrielli said later Petrobras is still exploring to determine Caricoa's size.

Bovespa's Gain

The oil company helped lead Brazil's Bovespa to a 6.3 percent jump on April 30, making it the world's best-performing equity index this year among the 20 biggest markets, after Standard & Poor's assigned the country an investment grade credit rating. Petrobras added 1.9 percent to 43 reais today as the Bovespa increased 2.2 percent.

Petrobras, now the world's ninth-biggest company, with a market value of $248.3 billion, is still half the size of Exxon, the largest oil producer.

Fourth-quarter profit at Petrobras declined about 3 percent as costs increased faster than sales. The company produced an average 2.34 million barrels of oil, natural gas and natural-gas liquids a day in March, down from 2.35 million barrels a day the month before.

Petrobras isn't earning enough, said Saulo Sabba, who oversees Rio-based Maxima Asset Management's Maxima Participacoes FI em Acoes fund, the best performer among Brazil-based equity and hedge funds last year. Sabba said he's ``very underweight'' Petrobras.

Profits Delayed

``It needs to show production growth today,'' Sabba said. ``This is what's going to influence the results this year and next. To add a long-term position, I don't think this is the time.''

Roberto Koeler, who helps manage the equivalent of $3 billion in assets at Icatu Harford in Rio, has Petrobras as his largest holding even though he says the stock is overpriced. Petrobras's price-earnings ratio was 8.77 a year ago and below 5 in June 2004, according to data compiled by Bloomberg.

The company's valuation surpassed PetroChina Co.'s in November after shares of the Beijing-based oil company posted their biggest monthly retreat ever.

Lukoil, based in Moscow, and Royal Dutch Shell, based in the Hague, trade at 7.77 and 7.6 times earnings, respectively. Irvine, Texas-based Exxon's PE ratio is 11.60. The rest of the world's 10 largest oil producers are also cheaper than Petrobras.

Brazil's biggest company by market value looks less expensive relative to the oil it owns.

Barrel Price

Petrobras trades for the equivalent of 34.91 reais per barrel of proven reserves, or $20.58, according to Bloomberg data. That's cheaper than Exxon's $22.19 a barrel and Royal Dutch Shell's $23.80 per barrel of oil equivalent in reserve. Under this measure, Petrobras is still more expensive than BP and Lukoil, which fetch $14.75 and $4.71 a barrel, Bloomberg data show.

Pumping oil from the Brazilian discoveries, parts of which are 32,000 feet (9,800 meters) below the ocean's surface, will require boring almost twice as far down as the world's deepest offshore well.

``Once Petrobras has the technology to start production on these finds, then we can start looking at the fundamentals,'' Sabba said.

The potential profits make Petrobras a long-term investment and its price relative to potential earnings worth it, said Craig Shaw, who helps manage $6 billion in emerging-market assets at Harding Loevner Management in Somerville, New Jersey.

``It takes a long time to really find out what you got, but early indications are quite striking,'' Shaw said. ``It's a very good company as it stands, and when you throw in the potential of what may be found, yeah, that does add to the valuation.''

http://www.bloomberg.com/apps/news?pid=20601213&sid=axnsTwiqMoF8&refer=home

Latin American Poker Tour kicks off in Rio de Janeiro

The Latin American Poker Tour (LAPT) kicks off today in the Brazilian city of Rio de Janeiro, making it a pretty ideal location for anything, much less a poker tournament.

The LAPT Rio will take place at the Intercontinental Hotel at 1pm tomorrow local time. Pros expected to show their faces include Costa Rican poker pro Humberto Brenes, Gavin Griffin, Chris Moneymaker, Greg Raymer, Victor Ramdin, Isabelle Mercier, Chad Brown and Vanessa Rousso.

The second stop of the LAPT takes place in San Jose, Costa Rica, on May 22-24, and the third stop will be at the Mantra Resort Spa Casino in Punta del Este, Uruguay, from Aug. 7-9.

All three events are have a cap of 300 players, which they are expected to hit, and have a $2,500 buy-in.

Since they are land-based tournaments with a less than $10,000 buy-in, the LAPT tournaments would fall under Bodog's "Player's Choice" promotion.

And we can recommend a couple of these stops as amazing places to visit, so head over to the Bodog Poker room and check out the LAPT online poker qualifiers.

http://www.theonlinewire.com/articleView.aspx?ID=3487