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Foreign Publishers in Brazil Still Optimistic Despite Slowdown

In Growth Markets by Iona Teixeira Stevens

By Iona Teixeira Stevens

brazil flagIt could be argued that the 2000’s were Brazil’s decade in the sun, one that went full circle — starting with the economic crisis 2002 and ending with next World Cup and Olympic Games. Same goes for the publishing industry. In 1994, the first time Brazil was a Guest Country at the Frankfurt Book Fair, the country had just come out of many years of exorbitant inflation rates that had undermined publishers and literary production. Today Brazil is ranked as the 9th biggest publishing market in the world, according to the latest Global Ranking of Publishers. All the major international digital platforms — Google, Apple, Amazon — have launched in Brazil, while a new middle class is enjoying tech gadgets and expanded reading possibilities.

Publisher Thomas Nelson arrived in Brazil in 2006, at the height of economic growth. According to Senior VP & Group Publisher Tod Shuttleworth, expectations were that “the economic situation and Brazilian demographics afforded the publisher an opportunity to grow in a new market with local publishing operations. The opportunities and growth have pleasantly outpaced our expectations.”

Tod Shuttleworth, Thomas Nelson

Tod Shuttleworth, Thomas Nelson

Another major foreign publishing group, Spain’s SM, specialized in education titles, arrived in Brazil nine years ago. Back then, says the group’s VP Luis Fernando Crespo Navarro, “our main difficulties were understanding the local culture, establishing a presence in children’s, youth and education segments. At the time Brazil was beginning to consolidate itself, that is, beginning processes of ‘fusions and acquisitions’ and IPOs of some companies in the education sector. In this scenario, starting from scratch, building a catalog in a brand new language was a very brave decision taken by SM.”

Alas, recent indicators point out that Brazil’s latest golden age might be coming to an end. Exchange rate swings and the expectation of lower GDP growth (ranging from 0%, for the most pessimistic, to 3%, for the utterly optimistic opinion, i.e. the Finance Minister) have shaken businesses across sectors this year, including publishing. Spain-based literary agent Adriana Navarro believes that “Brazilian economic slowdown and rise of dollar/euro discouraged Brazilian editors to buy European titles. On the other hand, I don’t think it affected sales of Brazilian titles in Europe – Brazil is so much in evidence lately that they rose.”

But, in general, foreign publishers are not worried about recent economic turbulence. “Our growth and profitability in Brazil are better than ever. So if there is an economic slowdown in Brazil, I guess it has had little impact on our business,” said Mr. Shuttleworth. And for SM, José Henrique Del Castillo Melo, Brazil Director for the company, says the group’s 70 years in the international market “gives us experience to evaluate and develop strategies beyond that. So Brazil’s economic situation has not affected our investment plans.”

Jose

José Henrique Del Castillo Melo of SM

In any case, it seems at last that Brazil is finally overcoming the curse of always being dubbed “the country of the future.” As Hegel Braga, Brazil Country Manager for Wiley, says: “Brazil has already proven itself. There are still many issues that need to be tackled, like infrastructure investments, for example. But Brazil has proved that it can survive external economic crisis without suffering as much as other economies around the globe.”  He adds that “in general terms, especially in the business where Wiley is in, the numbers here are telling a good story.”

About the Author

Iona Teixeira Stevens

Iona was an editor for PublishNews in Brazil before moving to London where she now works as a rights manager at HarperCollins UK.