Brazil's Odebrecht plans $8.1 billion landmark investment in Mexico
MEXICO CITY (Reuters) - Brazilian conglomerate Odebrecht ODBES.UL plans to spend $8.1 billion in Mexico in the next five years in what appears to mark the biggest investment pledge yet from a Brazilian firm in Latin America's No. 2 economy.
Odebrecht, one of Latin America's biggest family-owned companies, will invest in petrochemicals, renewable energy, ethanol and sugar production and highway concessions, according to a statement put out by the office of Mexico's president.
Marcelo Odebrecht, the company's chief executive, on Tuesday met Mexican President Enrique Pena Nieto, the statement said.
Odebrecht had no immediate comment on the announcement.
Since taking office in December, Pena Nieto has been pushing a reform agenda to boost growth and investment. Lawmakers are currently debating a bill that would open up the state-run energy sector to greater private investment.
Mexico and Brazil, which are regional rivals for attracting investments from the developed world and Asia, have at times had a patchy relationship marked by economic disputes and the failure to clinch a bilateral free trade deal.
Since 1999, Brazilian firms have invested less than $1.2 billion in Mexico, according to data on the Mexican economy ministry's website. That is less than 0.4 percent of the $335.7 billion of foreign direct investment that flowed into Mexico during the last 14-1/2 years, mostly from the United States.
Odebrecht, headquartered in Sao Paulo and Salvador, Brazil, has enjoyed enormous growth in Latin America in recent years.
Still, according to a recent report by rating agency Moody's, mismanagement of the regulatory environment in Brazil have made it harder for infrastructure firms to raise capital. Continued...