Brazil Sees Foreign Spending and Tourism Boost in First Quarter

By Nelson Belen, Contributing Reporter

RIO DE JANEIRO, BRAZIL – In contrast to most of the recent negative financial news from Brazil, on Tuesday, May 24th, the Central Bank released positive figures from the foreign spending sector. According to the Ministry of Tourism, the Central Bank data shows that spending by international visitors grew by 11.47 percent in the first quarter of 2016 compared to the same period last year.

From January to April, foreigners injected US$2.32 billion into the Brazil economy, compared to US$2 billion in the first four months of 2015. In April 2016, the revenue generated from foreigners, US$475 million, was 6.88 percent higher than the US$444 million generated in April 2015. This is the fourth consecutive month in which foreign spending in Brazil has exceeded last year’s figures.

By contrast, due perhaps to the country’s weak economy, spending by Brazilians abroad fell 41 percent, from US$6.87 billion in the first quarter of 2015, to US$4 billion this quarter.

Also, earlier in the week, the Ministry of Tourism released its tourism figures for last year showing that 6,305,838 foreigners visited Brazil in 2015. The number of visitors from South America in particular reached a record high of 3,420,349. This accounted for more than half of all visitors to the country, and Argentina alone accounted for almost a third of all of Brazil’s visitors with 2,079,823 people in 2015.

José Antonio Parente, head of the Brazilian Tourism Institute (Embratur), which uses campaigns such as Discover Brazil and Visit Brazil to promote the country throughout South America said, “This substantial growth shows that we are on the right track, that the actions of Embratur are showing results.” He added, “This scenario increases our expectations that tourism will be the great legacy of the Olympic and Paralympic Games Rio 2016.”

The tourism and foreign spending segment is expected to receive another boost next week when Australian, Canadian, American and Japanese tourists will be able to enter Brazil without a visa. This measure, which was enacted to facilitate the flow of visitors from these four countries leading up to and immediately after the 2016 Olympics, will begin on June 1st and last until September 18th.

“These tourists will move the country’s economy, with spending on hotels, restaurants, car rentals, travel agencies and some fifty other sectors, all affected by tourism,” said Brazil’s Minister of Tourism, Henrique Eduardo Alves. “In this period, our attractions will be on a world showcase, and if we do our part, many of these tourists will come back after the Olympics bringing friends and relatives,” he added.

David Scowsill, the president of The World Travel & Tourism Council (WTTC) praised Brazil’s decision to exempt visas during the Olympics, and added “We encourage the government to extend this policy after the end of the Olympic Games.”

The visa exemption, however, does have limits. It will not apply to foreigners who are visiting to perform paid activities, participate in research, training, studies and social or voluntary work, as well as undertake missionary, religious or artistic activities.

The four countries that will benefit from the visa exemption, the United States, Canada, Australia and Japan, accounted for 759,000 of the over six million visitors to Brazil in 2015.

For the upcoming 2016 Olympics, 500,000 tourists are expected to visit Rio de Janeiro.