Sao Paulo

In the latest tests of the OAB Sao Paulo (OAB stands for Ordem dos Advogados do Brasil, Order of Lawyers of Brazil, the counterpart of American BAR Association), 77% of the candidates failed to obtain the minimum level.

In Brazil, after finishing the Course of Laws (which take between five and six years), the students graduate as Bacharel in Laws; as a Bacharel, he/she can assume several juridical jobs (including public offices, all the way to Judges), but can’t represent on behalf of other before a Court. To become a Lawyer (which in Portuguese is referred to as Advogado, i.e., someone who advocates on behalf of others), a bacharel must be approved in tests conducted by the OAB of the respective State.

The high levels of failing at these tests are not uncommon. And if this happens in the richest State (with the best educational infrastructure in Brazil), the situation is even worse in the poorer States.

And the reasons are well known: the schools of Law in Brazil are bad. Until a few years ago, the opening of new institutions of superior learning was strictly regulated; today, it’s much easier to start a new faculty. And the easiest of all faculties to open is the School of Laws: no much need of physical instalations, no need of laboratories, no need of machines, etc.

And the result of this situation shows in the low quality of Brazilian ‘lawyers’ (everyone who finishes a Course of Law calls themselves a lawyer - advogado -, even though they are just bacharéis). The best graduates become successful and usually rich, by either working in private offices or in public offices (Judges and Prosecutors); several take clerical functions in offices and courts. But the vast majority of Brazilian lawyers end up with low paid jobs, often unrelated to the juridical career.

Being a lawyer in Brazil doesn’t have the same status as in other countries.

Credit is a problem in Brazil. Factors like: lack of capitals; a law which overprotectes debtors and underprotects creditors; high interest rates, among others, have been preventing a growth of credit in Brazil.

This week, the total volume of credits in Brazil reached R$ 1 trillion (about US$ 600 billion), the highest volume in the History of the country; that volume amounts to 36% of GNP, also the highest figure ever.

The graph below shows the total credit as percentage of GNP over the past few years.

It is noticeable that credit has been growing very fast. The reasons are the opposite of the factors mentioned in the top paragraph: there is an abundance of capitals (foreign investors are bringing large amounts of money into the country); laws are being passed to safeguard the creditors (for example, specific laws have been giving protection to banks which loan money for purchase of vehicles and real estate); interest rates have been falling.

And, as São Paulo has the biggest economy in Brazil, a good part of that credit was directed to people in the State. And the consequences are visible: the market for cars is hot, and the traffic jams are getting worse; real estate prices are reaching new record levels; the poorer classes (which never had credit before) are buying stuff like computers, TVs and the like, making their lives happier and increasing the popularity of President Lula in the process.

To commemorate the anniversary of the city of São Paulo, the Federation of Commerce of São Paulo prepared a report about the Economy of São Paulo; the report contains some information about the infrastructure of means of transportation in São Paulo.

There are more than 5,500 million vehicles in the city of São Paulo.

The São Paulo Metro (underground) transports more than 2.5 million people per day; the network has four lines, totalling 57.6 km (35.8 mi).

The city is served by 15,000 buses and 30,000 taxis (London has 20,000 taxis); the fleet of helicopters is the second biggest in the world (New York has the biggest one).

There are more than 5,500 street crossings with traffic lights.

The three airports in the city (Congonhas, Guarulhos and Campo de Marte) see 380,000 landings and take-offs per year. Congonhas is the busiest airport in Brazil. Guarulhos is the biggest airport in Latin America.

To celebrate the anniversary of the city of São Paulo, on January 25th, the Federation of Commerce of the State prepared a report with interesting data about the importance of the city in Brazil’s economy, which showed that, measured by the size of the Economy, São Paulo is bigger than 22 American States.

The Gross Product of the city of São Paulo reached R$ 263.2 bn in 2005, or US$ 102.4 bn; for conversion, the study used the average rate of 2005, US$ 1 = R$ 2.57. If the current rate, of about US$ 1 = R$ 1.80 were used, then the Product would be even bigger, about US$ 146 bn.

If the city of São Paulo were a country, its economy would be the 47th in the world, bigger than Egypt and Kuwait, about the same size as Hungary or New Zealand, about 85% of Israel. The economy of São Paulo would also be bigger than 22 of the American States, including Hawaii, Georgia and New Hampshire.

In 2005, the economy of São Paulo was 12.3% of Brazil. It is the second biggest in Brazil, 7% bigger than the State of Rio de Janeiro and 37% than the State of Minas Gerais. It is comparable to the size of Chile, and five times as bigger than Uruguay.

In 2005, the city of São Paulo collected R$ 90 billion in taxes, and the budget of the city spent R$ 15 billion; these figures show that São Paulo contributes to wealthiness distribution.

Other economic and financial information about the city of São Paulo

São Paulo is the biggest city in Americas and the third biggest city in the world, with 11 million inhabitants.

São Paulo has 1,500 bank branches. There are 70 shopping centers. Of all the international companies with business in Brazil, 63% have their head offices in São Paulo.

The Bolsa de Mercadorias e Futuros (Commodities and Futures Exchange) is the sixth biggest in the world, by number of contracts. In the Bolsa de Valores (Stocks Exchange) , R$ 6 billion (US$ 3.5 billion) change hands every day.

There are about 30,000 millionaires living in São Paulo, 60% of all millionaires in Brazil.

Every business day, half a million people go to 25 de Março (photo), a street of popular commerce in downtown. According to Mystery Shopping International, the Rua Oscar Freire is one of the eight most luxurious in the world. São Paulo has a car dealer specialized in Ferrari and Maserati.

The technology of using ducts to transport water has been used for centuries; the Jerwan aqueduct, in today’s Iraq, dates back to around 700 b.C.

In Brazil, there are only 20,000 km (12,500 miles) of aqueducts in Brazil, less than the 42,000 km (26,000 mi) in Mexico and much less than the 440,000 km (273,000 mi) in the USA.

However, the ethanol is gaining so much importance in Brazilian economy that Petrobras and the Government of São Paulo (São Paulo is the biggest producer of ethanol in Brazil) have signed a joint venture to build the first ethanol-duct in the world.

The ethanol duct would be about 1,150 km ( 715 mi) long. It would link the Southern extreme of the State of Goiás to the Port of São Sebastião in the coast of São Paulo, cutting through the Western end of Minas Gerais and all across the interior of São Paulo (see map).

Trucks will be used to move the ethanol from the mills to large tanks, which will feed the ducts. Pumping stations should be built every 200 km (125 mi) to keep the ethanol flowing, at an average speed of 3.6 km/h (2.2 mi/h). Click the image below to see a scheme of the ethanol duct.

Today, the transportation of alcohol is entirely made by trucks; Petrobras estimates that the duct could move a volume equivalent to the load of 1,000 trucks per day. The duct should be in operation by 2011, at a cost of US$ 1 billion; today, the cost of transportation is about R$ 130 (US$ 75) per 1,000 liters, and should drop to about R$ 40 (US$ 23).

The Government of São Paulo is proposing a law which will be a pioneer in Brazil: if a car is stolen, the owner will not have to pay the respective taxes (if he didn’t pay yet) or will have tax refunded (if he already paid the taxes).

In Brazil, the tax on vehicles is called IPVA (Tax on Property of Automotive Vehicles) and is collected by the States (half of the tax must be remitted to the municipality where the vehicle is registered). Each State has autonomy to regulate on IPVA.

Every year, the State establishes a deadline for payment of IPVA; usually, cars with licenses ending in 0 and 1 pay in March, ending in 2 and 3 pay in April and so on. IPVA may be paid all at once, with a discount, or in monthly installments. Today, when a car is stolen, the owner must keep on paying monthly until the DETRAN declares the car is stolen (which may take a few months), or will loose the money, if he paid at once.

After the new law is passed, the owner of the stolen car should go immediately to the Police and file a “Boletim de Ocorrência” (BO), a record of theft. The BO can be filed over the internet, if the car was stolen without violence, or in a Police Department, if the car was robbed with violence (gun point). The BO is automatically passed to the Secretary of Justice, and from there to the Secretary of Finances.

The owner shall pay taxes only until the month that the car was stolen; if the car is recovered, the owner must start pay monthly taxes again. If the IPVA was already paid in totum, then the owner will have to wait for one year to either get a credit or get a refund; if the car is recovered, the credit will be proportional to the months the car was stolen.

See more detailed info (in Portuguese) at this page of the website of the São Paulo State.

Governor of São Paulo José Serra (on the photo, introducing the law) says that it is the obligation of the State to avoid cars being stolen or robbed. If the State fails to acomplish this mission, it is fair that the tax payer be exempted. Cars stolen in other States of Brazil will not be benefited by this law.

SEADE (Sistema Estadual de Análise de Dados - State Secretary for Data Analysis) published a report today concluding that, upon examining data surveyed by the Brazilian Institute of Geography and Statistics, in the year of 2005 (latest data available), the Gross Product of the State of São Paulo grew more than the GNP of Brazil.

The Gross Product of São Paulo grew from R$ 643 billion in 2004 to R$ 727 billion in 2005, a growth rate of 3.6%; the Brazilian GNP grew, in the same period, by 3.2%.

The Services sector grew by 4.4%, with particular strenght in the Services for Corporations (6.6%) and Financial Services (5.1%). The Industrial sector grew by 2.1%. Constructions remained stable, and Agriculture shrank by 3.6%.

The Product of São Paulo grew to 33.9% of Brazil’s GNP in 2005, up from 33.1% in 2004. The graphs below shows that the GNP of São Paulo is bigger than all regions of Brazil (North, North East, South, West Center), except for the South East region, where São Paulo itself is located.

The same SEAD report revealed that the GNP per capita in the city of São Paulo is more than 50% bigger than the GNP per capita of Brazil. In the city of São Paulo, GNP p/c was R$ 17.977, and in Brazil it was R$ 11.568.

More information (in Portuguese): click here.

A new shopping center was opened in São Paulo: Shopping Itaquera.

It is very unlikely that tourists or business people ever come to visit this shopping. Itaquera is the very last station, in the Eastern end, of the West-East metrô line; access to the shopping will be through the station. With nearly 500,000 inhabitants, Itaquera is bigger than most Brazilian cities; most of the residents in Itaquera are of lower income classes, many have emigrated from other States in Brazil.

The opening of the Shopping Itaquera, the first one in the Eastern extreme of the city, shows that the progress is arriving, even in the most distant areas of São Paulo (3,500 jobs were opened). The shopping will have 200 shops, about ten big anchor shops, eight movie theatres, several restaurants.

In the first day, 70,000 people visited the shopping, twice as many as the average of the shoppings in São Paulo. Administrators of Itaquera said that new improvements are expected soon, such as a public Faculty, a regional Court of Justice and an inter-city bus station.