PERNAMBUCO INVESTMENT OPPORTUNITIES

1. PERNAMBUCO INVESTMENT OPPORTUNITIES

2. State of Pernambuco Capital Recife Population (2010 Census) 8,796,032 ± R$ 10,000 Income per capita (2008) GDP (2010) US$ 52.5 billion

3. Strategic Location 350 km 4 state capitals 3 international airports 2 regional airports 4 international ports 12 million inhabitants Over 35% Northeast GDP 500 km 700 km 7 state capitals 5 international airports 6 international ports 1 river port 20 million inhabitants 90% of Northeast GDP

4. Human Capital in Pernambuco • 5 universities and 5 advanced campi in inner state. • Numerous research institutes and professional schools. • Over 3.000 PhDs and masters. • Over 2.300 National Research Council (CNPq) researchers. LEADER IN THE NORTHEAST

5. PernambucoNortheast region logistic center • 4 Airports (Recife, Petrolina, Fernando de Noronha e Caruaru). • 6 regional airdromes. • 2 ports (Suape e Recife). • 98 distribution centres. • 112 incentivized import centers (2007 – 2010).

6. Pernambuco – GDP Evolution +15,78%

7. Pernambuco GDP x Brazil GDP

8. Jobs generated / Unemployment rate +89,16%

9. Investments in Suape +332,02% +491,33% • In the last 04 years, resources invested in SUAPE doubled total investments in the previous 30 years.

10. ICMS (state service tax) revenue +15,8%

11. Fiscal Incentives – PRODEPESpecial Industrial Group Special Pharma-chemicals – exclusively within the Pharma-chemical Cluster Special steel Industry Special automotive industry Laminated aluminium and flat glass industry

12. Fiscal Incentives – PRODEPEPriority Industrial Group Electro-electronics Nonmetallic minerals (except cement and red ceramics) Metal-mechanical Agribusiness (except sugarcane) Pharmaco-chemical Textile Plastic Beverages Furniture

13. Fiscal Incentives – PRODEPE Priority Industrial Group

14. Fiscal Incentives – PRODEPE Relevant Activities • Encompasssectors not specified among those belonging to priority and special industrial groups. • Sectors that do not receive incentives: Sugar and alcohol agribusiness Quarrying Liquefied gas (LPG) packaging industry Wheat milling

15. Fiscal Incentives – PRODEPE Distribution Centres

16. Fiscal Incentives – PRODEPE Imports Wholesale Commerce

17. Other Incentives • PRODINPE – Pernambuco Naval Industry Development Programme. • PRODEAUTO – Pernambuco Automotive Sector Development Programme. • Oil Refinery. • Polyester Cluster. • Textile Industry. • PRÓ-VINHO – Wine Industry • PRÓ-CALÇADOS – Pernambuco Leather and Shoe Industry Program. • Federal Government incentives.

18. Public Private Partnerships (PPP)Paiva Beach Road System • Purpose: exploit the Paiva Beach access bridge and road system, preceded by works and services. • Modality: sponsored concession. • Term: 33 years. • Cost: R$ 144 million.

19. Public Private Partnerships (PPP) Itaquitinga Integrated Resocialization Centre • Purpose: exploit the Itaquitinga Integrated Resocialization Centre, preceded by works. • Modality: Administrative concession. • Term: 33 years. • Cost: R$ 287.4 million. • Resources: BNDES (70% - 80%) plus successful bidder equity (20% - 30%). • Capacity: 3,126 inmates.

20. Public Private Partnerships (PPP) 2014 World Cup Multipurpose Arena • Purpose: exploit the 2014 World Cup Multipurpose Arena, preceded by works. • Modality: Administrative concession. • Term: 33 years. • Cost: R$ 379,263,314.00.

21. Public Private Partnerships (PPP) Sanitation and Water Resources • Purpose: Recife Metropolitan Region sewerage system expansion. • Investment: over R$ 3.5 billion. • Term: 12 years for the works. • Financial compensation in order not to increase fee charged.

22. Link between Itapissuma and Suape, bypassing Recife. Importance: Will integrate northern areas or Recife Metropolitan Region to Suape Port and Industrial Complex, alleviating traffic congestion and enhancing urban mobility. Investment: R$ 1.8 billion. InfrastructureArco Metropolitano (Metropolitan Arch) Fonte: Agência Condepe/Fidem/AJA Consultoria, 2010.

23. InfrastructureCapibaribe Melhor Project • Purpose:To streamline the urban patch of the Capibaribe river. • Term: 5 years. • Resources: US$ 46.8 million, 70% financed by BIRD.

24. InfrastructureCapibaribe Melhor Project • Urban, environmental and social interventions. • Proposed works: • Parks and green areas. • Water and sewer system. • Drainage system. • Accessibility and urban mobility.

25. InfrastructureNorth-South Route • Implementation of an Integrated Transport Network - North-South Axis. • Exclusive route and hub terminals. • Comfortable vehicles with greater level boarding capacity. • Integration with other important transport axes (subway and transverse bus axes).

26. Infrastructure North-South Route CAJUEIRO SECO IGARASSÚ AERONAUTICA PELÓPIDAS SILVEIRA PE 15 • 300,000 passengers/day. • Bus stations every 500m, approximately. • 5 hub terminals.

27. Infrastructure / East-West RouteBus Rapid Transport (BRT) and Monorail • Exclusive bus lane. • Bus / monorail stations every 500m, approximately. • Ticketing in advance. • Level boarding. • Punctuality. • Vehicles average speed increased. • Accessibility guaranteed for all.

28. InfrastructureCidade da Copa / World Cup City • Construction : 2010 - 2012. • Public interventions: • urban mobility (express way); • infrastructure; and • logistics.

29. NORTH Pharmaceutical cluster Tourism cluster InfrastructureCidade da Copa / World Cup City • Metropolitan Scale • Conurbation (Recife, Olinda, Paulista, Jaboatão, Camaragibe). • CidadedaCopa / World Cup City in São Lourenço, Recife Metropolitan Region’s geographical centre. World Cup City CENTRE Services cluster Tourism cluster SOUTH SUAPE Port and Industrial Complex Tourism cluster Recife Port - 19 Km Airoport - 19 Km Passengers Hub Terminal – 2Km 29

30. InfrastructureTransnordestina Railway Railway linking the Brazilian “cerrados” to Pecém (Ceará) and Suape ports. • Increases Pernambuco’s economic competitiveness. • Strengthening Suape as a Hub Port.

31. InfrastructureTransposition of the São Francisco River 700 km of canals and over 1000 km of reservoirs, rivers and dams.

32. Petrochemical Cluster Main enterprises • Anchor company: Abreu e Lima Oil Refinery which will produce Naphtha, an important raw material for the petrochemical industry. • Purified Terephthalic Acid (PTA) plant, which will produce raw material for polyester production (demanded by Petroquímica Suape). • Polyester Yarn (POY) factory, which will produce important raw material for the textile and clothing industry of Pernambuco. • PET resin industry (Mossi & Ghisolfi – M&G).

33. Abreu e Lima Oil Refinery • Investment: US$ 13.3 billion. • Processing daily capacity: 230,000 oil barrels, meeting most of the diesel demand in the North and Northeast regions. • Products: diesel, coke, coke gas, LPG and naphtha (raw material for the plastic resin).

34. Petrochemical Cluster- Petroquímica Suape • Total investment: R$ 4.94 billion. • PTA plant: R$ 2.40 billion; • Polyester yarn unit: R$ 1.66 billion; • PET resin unit: R$ 882 million. • Installation current stage: • PTA plant: 75.68%. • Polyester Yarn Unit: 54.67%. • PET resin unit: 49.79%.

35. Naval ClusterAtlântico Sul Shipyard • Investment: US$ 1 billion. • Largest naval and offshore building and repairing shipyard in southern hemisphere. • 160,000 steel tons / year. • Area: 1.56 million m². • Dry-dock 400m high, 73m wide and 12m deep.

36. Naval Cluster / Promar Shipyard(PMJR Group & STX Brazil) and MPG Shipyard Promar Shipyard: • Ships building and naval projects. • Investment: R$ 630 million. • Area: 100 hectares. • Job Generation: 1500 direct and 6000 indirect jobs. MPG Shipyard • Offshore modules, ships and wind energy equipment builder. • Investment: R$ 252 million. • Area: 33.5 hectares. • Job Generation: 1200 direct and 6000 indirect jobs.

37. THANK YOU!