Brazilian Newspaper “Valor” Features Council President

Translated from Portugese. The original article is available for download below. 

Brazil is beginning to attract risk capital to finance innovative companies, which is good for economic performance, but a cultural change is still lacking. The elites need to risk and bet on innovation. In addition, universities need to be closer to the market in order to bring value to their discoveries.

Deborah L. Wince-Smith, president of the U.S. Council on Competitiveness, visited the country this past week and met with businessmen and ministers, such as Minister of Development Miguel Jorge and Minister of Science and Technology Sergio Rezende, and with the Armed Forces. The Council is an organization comprised of 180 members who are CEOs, university presidents and labor leaders.

“I know four American venture capital funds that spend substantial amounts of time here investing in energy and sustainability. They are putting money and administrative know-how in early stage developments,” Wince-Smith told Valor. “These funds are enthusiastic about Brazil as an opportunity.”

She insists that nevertheless, the country needs a change in mentality. “There is a lot of wealth in Brazil, but people believe that they will succeed in getting more return on blue chips or CDs rather than investments in creativity and knowledge from universities, and this isn’t good for the country.” For Wince-Smith, there has been a “divorce” between university research and the economic potential of Brazil. She emphasized that the country possesses a very small (reduced) number of patents and took the opportunity to repeat the old appeal of the United States for Brazil to enforce respect for intellectual property rights.

Wince-Smith, who serves on the board of directors for the NASDAQ stock exchange, said that there is investor confidence and consequently a healthy economy due to the control of inflation, and this has attracted a (good) level of investment. She pointed to learning about the development of capital markets and investments in ethanol as the most interesting aspect of her visit.

In the view of Wince-Smith, Brazil is part of an initiative of the two countries for innovation. In June 2007, the first Brazilian-U.S. Summit on Innovation was held in Brasilia. The next will occur in 2009 in Washington.

Wince-Smith said that at the moment, the United States is facing a complicated financial crisis. “We haven’t done a good job with our regulatory environment,” she recognized. “The subprime mortgages and high prices of gasoline are creating a storm.”

The Council on Competitiveness was created 22 years ago. At that time, the country that they were competing against for technological innovation was Japan. The discussion today, said Wince-Smith, is about competition from emerging countries like China, and the secret is to be a leader in innovation and guarantee high skilled jobs. She says she is not worried about acquisitions of American companies by foreign companies, such as the purchase of Anheuser-Busch by the Belgium-Brazilian company Inbev. “It is part of the global game,” she said.

Download the original article in Portugese (PDF).