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Why Are Companies Choosing Brazil for Expansion in 2025?

Writer: Camila NasrCamila Nasr
Mar 163 min read

Brazil has become one of the top destinations for foreign investments in Latin America. However, unlike in the past when the country was viewed merely as a promising emerging market, companies are now adopting a more strategic and sector-specific approach when expanding their operations. Certain industries have proven to be more receptive and advantageous for international investments, and the ability to adapt to Brazil’s regulatory and cultural complexities has been a key factor for successful businesses.


1. Consumer Market: Opportunity Beyond the Numbers

Brazil is the largest economy in Latin America and the fifth most populous country in the world. However, simply considering market size is not enough. Brazilian consumer behavior has changed drastically due to accelerated digitalization and the rise of fintechs. Companies that understand this complexity are gaining traction.

Amazon, for example, has not only expanded its operations in Brazil in recent years but has also tailored its logistics model to regional specificities. In 2023, the company inaugurated a new distribution center in Minas Gerais to improve delivery times in previously underserved areas, strengthening its competitiveness against local marketplaces.


2. Economic Reforms and Tax Incentives: Real Differentiators or Empty Promises?

Over the past few years, Brazil has undergone structural reforms that promise to improve the business environment, but challenges still remain for foreign companies unfamiliar with the system's nuances. Some of the changes making a real difference include:


  • Ongoing Tax Reforms: Aiming to make taxation more predictable but still complex for those without proper local support.

  • Sector-Specific Tax Incentives: Some industries, such as renewable energy and technology, offer substantial benefits but require a well-defined legal structure to access them.

  • International Trade Agreements: Despite progress, specific sectors still face protectionist barriers.


The automotive sector has particularly benefited from real incentives. Companies like Tesla are exploring entry into the Brazilian market, drawn by the Rota 2030 program, which rewards innovation and sustainability. However, without a detailed plan to adapt their products to local infrastructure, companies may face challenges similar to those experienced by traditional automakers in the country.


3. Strategic Sectors for 2025: Where Should Companies Invest?


Although many industries show growth potential, some offer clear competitive advantages for foreign companies. The key sectors expected to stand out include:

  • Technology and Innovation: Cities like São Paulo and Florianópolis are emerging as technology hubs, but challenges such as a shortage of skilled labor may require investment in local training programs.

  • Renewable Energy: Brazil has become a global leader in solar and wind energy, with auctions attracting major international investors.

  • Healthcare and Pharmaceuticals: The aging population and new regulatory demands require innovative solutions, drawing investments from companies such as Roche, which recently expanded its oncology research in the country.


4. Expansion Challenges and How to Overcome Them with Intelligence

Expanding into Brazil requires more than capital and interest—it demands detailed planning and a deep understanding of local regulations. Large companies that entered the country without an adaptation strategy failed, while those that grasped regional dynamics thrived.

Carrefour, for example, faced regulatory challenges when acquiring the BIG supermarket chain, requiring a detailed analysis of competition laws and approval from CADE (Brazilian Administrative Council for Economic Defense). The company was only able to finalize the acquisition after carefully adapting to Brazilian market requirements.

Brazil remains one of the most promising economies for international expansion, but success depends on more than just good opportunities—it requires strategy, adaptation, and specialized support. At Maldonado, we assist foreign companies at every stage of the process—from legal structuring to regulatory management and compliance. Our key differentiator is our 20 years of experience in Legal Representation, deep understanding of the Brazilian market’s specificities and our ability to tailor strategies for sustainable growth. Contact us to learn how we can support your business with customized solutions.


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