BRAZILIAN ECONOMY IS ONE OF THE FASTEST GROWING IN THE WORLD, STEPPING OUT OF THE PERIPHERY INTO THE SPOTLIGHT AND ON ITS WAY TO BECOMING THE COUNTRY OF THE FUTURE. ITS GEOSPATIAL INDUSTRY IS IN SYNC, WITH THE BENEFITS OF THE TECHNOLOGY BEING REALISED BY A WIDE RANGE OF USERS AND IMMENSE SCOPE FOR FURTHER GROWTH. HERE'S AN ASSESSMENT OF BRAZIL'S GEOSPATIAL INDUSTRY – ITS BUSINESS DRIVERS, STAKEHOLDERS, CHALLENGES, OPPORTUNITIES AND THE ROAD AHEAD
Brazil is one of the fastest-growing economies in the world. According to industry estimates, the country has registered a 9 percent growth in the first quarter of 2010. Little wonder then that the world's fifth largest country is outweighing other South American nations by its large and well-developed agricultural, mining, manufacturing and service sectors. Add to it the fact that the country will be playing host to two of the world's most popular sporting events – 2014 Soccer World Cup and 2016 Olympic Games – and the country is all set for exponential growth in the coming years. And with the growing stature comes a more aggressive geopolitical stance.
The country's geospatial industry is matching pace with its economic growth. The industry is passing through a very critical process of gaining maturity. Sustainable development requires balancing economic development with the need to improve and sustain the quality of life, conserve resources and coexist in harmony with nature, thereby protecting the future generations as well. Because geography is a basic element in this quest, geospatial technology plays a key role in ensuring informed decisions aimed at creating sustainable environment. Brazil's decision makers are already using the technology towards this end.
BUSINESS DRIVERS
Brazil is rich in mineral resources: Its steadily rising industrial sector and rapidly growing agricultural sector, coupled with a government that is actively encouraging foreign investment, auger well for the growth of its geospatial industry.
2014 and 2016 sports events: Brazil has made its mark in the international sports arena by securing hosting rights for two premier sporting events – 2014 Soccer World Cup and 2016 Summer Olympics. The events will offer the country an unparalleled opportunity to showcase itself to the world. These events will not only boost Brazil's economy and infrastructure but will also allow it to package itself before the world in a way that would result in immediate and sustained benefits to all segments of the economy. The success of these events will be crucial in determining its emergence as a favoured destination for investors and corporate houses.
As part of its winning bid to the International Olympic Committee, Brazil committed to spend upwards of $14 billion on a vast programme of sports-related infrastructure development.
Infrastructure development: Brazil is investing as much as $229 billion through 2015, with investment levels rising by 18 percent/year. The government's growthacceleration programme, launched in 2007, encompasses building initiatives such as airports and ports throughout the country, repair of highways, development of energy projects in the north and providing housing, water and sewage systems to benefit the poorer Brazilian communities. The programme also consists of measures to improve the investment environment. A quicker turnaround of construction projects is one of the expected outcomes, in addition to encouraging further infrastructure development through oil, gas, transportation and sanitation projects.
Utilities: Utilities, including electricity, water, gas and phones are significant contributors to good quality of life in urban environment and Brazil is no different. The rise of the services sector has also resulted in the growth of the middle class, resulting in stable cash flow in the overall sector. Brazil is leading the way in Latin America in showing significant Smart Grid activity.
Mining and minerals: Brazil has world class resources of minerals including silver, copper, nickel, niobium, zinc, iron ore, manganese, bauxite, tin and gold, not to mention a comprehensive suite of industrial minerals and fuels. The status of Brazil as a top priority region in global allocation of mining investments can be understood by analysing its relative importance in attracting parcels of the flow of foreign capital directed to exploration and development of mining business opportunities. Participation of foreign investors in mineral and energy sectors is also being encouraged by the government.
Oil and Gas: Sitting upon 12.2 billion barrels of oil reserves, Brazil is one of the world's fastest growing oil producers. As the tenth largest energy consumer in the world, one of the world's largest ethanol producers and the country with the second largest crude oil reserves, Brazil is a critical player in the global energy market. The country continues to welcome foreign investment from international oil companies to increase direct investment in hydrocarbons.
Agriculture and forestry: Self-sufficient in foodgrains, Brazil offers very strong potential in agri-business. It is a leading exporter of a wide range of crops including oranges, soybeans, coffee and cassava. Brazil, unlike most Latin American countries, has increased agricultural production by greatly expanding its cultivated area. The South and Southeast parts of the country are important for forestry as well.
Open mapping policy: A significant contribution in awareness towards GIS-based information systems has been made by Right to information and Open Map Policy. A large portion of map-data is freely available and both government and private organisations are trying to find easier ways to manage, update and publish information for the public. Users are permitted to have their own independent programmes regarding acquisition and management of geospatial data including aerial photography and high resolution satellite images. Another interesting facet highlighted by Gilberto Camara, General Director, National Institute for Space Research (INPE), is that the national remote sensing agency, INPE, has made all its data available on Internet, free of charge, to serve its citizens. This initiative has further been supplemented by providing free open source software known as SPRING which is good enough for elementary usage of satellite images.
Democratic political set up: Brazil is politically stable and organised under a democratic system. It has an optimistic long term outlook as it is largely free from getting locked in conflict with its neighbouring countries. Its economy is more broad-based and so far it has shown no ambition of playing any significant political role on the world stage.
STAKEHOLDERS
Crucial to defining and steering the future direction for an industry are its stakeholders. Some of the key stakeholders of the Brazil geospatial industry are discussed below.
National Mapping and Remote Sensing Programme
The Brazilian Institute of Geography and Statistics (IBGE) is the Federal Government institution responsible for producing, analysing and disseminating statistical information as well as geodetic, cartographic and geographic information and the information related to natural resources and environment. The combination of statistics and geosciences in its activities allows IBGE to optimise resources and maximise the quality of the contributions of each area of the Institute. IBGE is also responsible for systematising information on natural resources and for carrying out regional geography studies.
Brazil also has the National Institute of Space Research (INPE, responsible for the development and application of space technologies in space and atmospheric sciences, research and development in space engineering and technology, remote sensing, Amazonia Program, research and development in meteorology, technologies associated with the field of space and the Earth Observation Project that focusses on scientific and technological knowledge on remote sensing and geoprocessing, natural resources surveying and environment monitoring.
Companhia de Pesquisa de Recursos Minerais (CPRM) is the foremost company in the field of geological mapping. In the year 2000, the company launched a vigorous programme of modernisation in the area of information technology to present its products through the mapping technology of GIS and relational databases, informs Joao Batista V. Dias Junior, Chief of Staff. It began presenting its maps and other cartographic products via GIS and the relational data banks. The project Projeto GIS do Brasil, launched in the same year, constituted a technological milestone for the country as it represented the migration from traditional to digital paradigms. In the year 2000, with the objective of meeting the need for a data structure to support the project, the idea of a corporate data bank was floated, leading to further expansion of the geological data bank, GEOBANK, Dias adds.
CONCAR – The National Commission of Cartography, plays a directive role in setting up technical standards and specifications based on which is the production of geospatial data for the National Catrographic System. CONCAR comprises the majority of the geospatial data producers and maintainers of Brazil's public sector, including one representative of each of the following: 19 Ministries; IBGE itself; the mapping branches of Army, Navy and the Air Force; one association representing the private sector companies which provide air survey and mapping services and five regional forums representing the federation's states.
Linked to the Ministry of Economy and Planning, the Geographical Institute of Cartography – IGC was created to promote knowledge of Paulista territory through the production of cartographic detail and accuracy and geographic studies related to the Administrative and Territorial Division of the State of Sao Paulo. According to Alexandre Iamamoto Ciuffa of Geographical Institute of Cartography, most of the maps available to users are in an unsatisfactory scale and not updated. IGC is responsible for converting existing digital maps and restituting new digital maps of regional scale; developing new methodologies for use of satellite imagery and mapping specific software to produce thematic maps; implementing GIS with information from the database of IGC and other public agencies; conducting studies and field surveys to subsidise the process of changing the territorial-administrative framework of the state and aerophotogrammetric survey.
The design of a new highway, the construction of a hydroelectric power plant, the installation of an industrial complex, decisions on resource planning and manage- ment, as well as the elaboration of public and private policies – all are facilitated with the introduction of the National Spatial Data Infrastructure (INDE). According to Luiz Paulo Souto Fortes, Director of Geosciences, IBGE, users have access by means of an Internet portal, the SIG Brasil. During the next decade, other national organisations – at state and municipal level, for example – will be able to join INDE. The portal will be fed and updated with geospatial information from diverse bodies.
Geospatial companies
According to a survey by Magalhaes & Granemman, there are more than 200 companies working with GIS in Brazil. A market research from Intare Consulting in Information Management pegs the market potential for geotechnology in Brazil at $360 million, taking into account all the data components, software and services, with a growth of 9 percent between 2006 and 2007 and estimated 20 percent for 2008. In Brazil, the data providers have established their business around the failures of the Brazilian mapping agencies to provide basic digital cartographic information, with their business mostly consisting of digitising existing topographic maps as well as high-resolution imagery distribution. In the coming years the private companies are likely to continue to be influenced by the networks of innovators. As the public SDI in Brazil grows, one can expect a reduced market for data providers and an expansion of the market for service providers who will have to adapt themselves to a geospatial information market centered around building corporate applications based on spatial databases.
Users
Municipalities and town planning: The city of Rio de Generio had been grappling with the housing problem for quite some time. To tackle the situation, the Municipality of Rio de Janeiro has implemented the SABREN System for lowincome settlements, with an aim to gather and disseminate information on slums and irregular settlements and other types of illegal squatter settlements in the city, informed Fernando Cavallieri, Director of City Information, Instituto Periera Passos.
In 2004, the Municipal Authority of the commercial capital Sao Paulo, also known as City Hall, decided to acquire high resolution large scale maps of 1:1000 scale and larger scale through aerial photography in partnership with the federal government. According to Luiz Cesar Michienlin Kiel, Development Manager, Prod, PRODAM, Sao Paulo, "While the primary objective was to create an updated large scale map and use the same for multiple purposes by different departments of the Municipality, this initiative also helped to increase revenues and tax collections as it gave a much more detailed information about property and cadastre falling in municipal areas." As of today, the secretariats dealing with human development, government management, finance, production and planning have agreed to use the maps and have created a technical group to assist and cooperate with each other, says Jose Marcos, Director, DIPRO, Prefeitura de Sao Paulo.
Project GeoCONVIAS is the result of a partnership between CONVIAS (Infrastructure and Work Department of city of Sao Paulo) and SABESP (Sao Paulo Waste and Water Company) and extended by association with other companies that operate in the Sao Paulo city area. According to Eng. Antonia Ribeiro Guglielmi, Director, Department of Control of Public Roads, the GeoCONVIAS system consolidates the asset data buried or underground in the municipality areas by using a unique geospatial database. According to Carlos Henrique Gomes de Souza of Municipality of São José do Rio Preto, since the initial deployment of geographic information system, a major obstacle to expansion of the system in the Municipality has been the difficulty in acquiring and maintaining licenses primarily in the acquisition of new licenses for new users. With the signing of the contract ALS, the outlook started to change, expanding the number of users and therefore the applications of GIS in the county.
Utilities: The Brazilian National Water Agency was established with the mandate of enforcing the National Policy on Water Resources. On December 9, 2009, the Brazilian National Water Agency presented the Atlas for Urban Water Supply for metropolitan areas, for North Eastern and Southern Brazil. Marcelo Bitter, Business Development, GeoAmbient, informs that the studies conducted in the Atlas include population forecasts and demand estimates, evaluation of sources referring to water availability and quality, diagnosis of water producing systems and a proposition of technical alternatives for the water supply until the year 2025.
The Sao Francisco Hydroelectric Company (Chesf) has recently created a new GIS solution which unifies and shares important information to meet the various business processes of different departments. With its decision to acquire an enterprise GIS platform, the company now boasts of a robust platform that allows the sharing of information from the access to corporate database, said Valeria Carazzai, Engineer Cartographer, Chesf.
Mining and minerals: Companhia Vale do Rio Doce (Vale), the second-largest diversified mining and metal company in the world, is one of the pioneers of the use of geotechnology in Brazil. According to Paulo Fernando Costa, Sr GIS Specialist, VALE, geoprocessing was introduced into the planning and implementation of mineral exploration projects in early 1980s and today it provides support to all phases of the project life cycle. They provide strategic and support tools for defining guidelines for decision-making and efficient operations management.
Codelco applied a GIS-based analysis and classification strategy of satellite data for exploration of copper province of Brazil. Analyses of geological, structural and optimised remotely sensed data of the mining areas aids in identifying some common characteristics of altered rocks and associated porphyry copper ores, informs Alexandre Carnier Nunes da Silva, Geologist GIS Coordinator, Codelco.
Oil and gas: National Agency of Petroleum, Natural Gas and Biofuels (ANP) is an autarchy functioning under the control of the Federal Public Administration. The solution initially adopted at ANP to maintain the data related to oil fields was based on geoprocessing tools. Fernando Gonçalves dos Santos, Regulatory Specialist – Geologist, Superintendent of Collection Management and Technical Data – TDS, ANP points out that challenges pertain to interoperability of data and systems; access, sharing of geospatial data; web (Intra/Internet) geospatial data dissemination; confidence and access speed; geospatial data management and integrity; geospatial data storage; interconnection with other databases and information technologies systems; handling of a great amount of raster data; metadata creation and recovering and in implementing a new geoprocessing structure.
When a GIS solution was first considered at Petrobras Gas Business Unit in early 2003, the situation demanded a reliable and efficient system to support the engineering division responsible for the conceptual design of new gas pipeline projects and management of the existing one. To meet ongoing demands from regulatory and environmental agencies, the Unit started GIS implementation with a different approach that has yielded good results. The implementation cost of this was about $ 268,000. Although the GIS tools require some time to be properly implemented, they guarantee data reliability and integrity and ensure that all professionals linked to the project will have quick access to updated information, says Marksuel Xavier Bastos, Geodesy Engineer, Perobras. Petrobras recently implemented a 3D GIS environment for management of equipment including manifolds, pipelines and platforms.
Environment and Forests: In the Amazonia region of central Brazil, environment management is a major challenge, especially deforestation in the Para region. The Ministry of Environment of Para (SEMA / PA) has been coordinating the Rural Environmental Policy Registration (CAR) of the private property of rural areas with the goal of promoting environmental regulations of economic activities that result in changes in forest cover. In order to give transparency to the outcomes of this policy, the EMS / PA has provided on its homepage, a link to access the map with all the registered properties, informs Gadelha Rodolfo de Sousa, GIS Technician at Para Gadelha Rodolfo de Sousa, Ministry of Environment of Para.
Meanwhile, the Department of Environment, Sao Paulo has recently launched "Environment Paulista: Environmental Quality Report 2010." According to Arlete Tieko Ohata, DIA Director / CPLA, Secretary of State for the Environment, Sao Paulo, the work is a reflection of the environmental status of Sao Paulo, addresses key issues in the environmental area and aims to provide decision makers with relevant information. The various programmes related to environment underway at Instituto Geologica, Sao Paulo with an aim to contribute to the understanding and meeting the demands of mapping and interpretation of geological units of the State of Sao Paulo are evolution of high-grade metamorphic terrains and plutons and geomorphology of the State of Sao Paulo, informs Paulo C Fernandes Da Silva, Executive Technical Advisor, Instituto Geologico. The geotechnical and environmental research underway aims to develop research focused on characterisation of the climatological state of Sao Paulo, especially rainfall, promoting awareness towards differences of the elements of climate in time and space and supporting the integrated study of the environment, said Antonio Carlos M. Guedes from the Institute.
CHALLENGES AND CONSTRAINTS
As the geospatial industry in Brazil is in its nascent stages, it has its own set of challenges.
Immature geospatial industry: The industry requires a lot of nurturing before it can reach a stage of maturity. A historical perspective to its development reveals that it has been concentrated in pockets and is being driven by few disconnected drivers. This fragmented development has resulted in a lopsided development of the geospatial industry and has been a constraint for overall industry growth, opines Alexandre P. Cabral, Business Line Manager, Fugro Brazil.
Paucity of large geospatial companies: For a country which is home to almost 200 million people with approximately $5000 per capita income, Brazil has no geospatial company worth the name with local origins. Most of the geospatial business in the country is carried through a network of distributors. Distributors catering to the whole country are a rarity. Also, a single distributor handling two or more rival manufacturers is not rare.
Price driven market: In a price sensitive Brazilian geospatial market, demand is disproportionate to price and the number of professional dealers is very limited. Professional dealers bid for the products and then fix prices not as per the cost price of the product but on projected demand for the product.
Market-makers quote prices at which they are prepared to buy or sell, up to some quantitative limit, says Eng. Marcos Guandalini, Sales Director, Alezi Guandalini. They adjust the prices according to the supplies, implying that the prices will increase if the stocks are ill supplied and vice-versa.
| 'Brazil is in the right direction' | |
Kindly highlight the dynamics of the South America market Hexagon group has been investing consistently in the South American continent for a long time and both Leica Geosystems and Hexagon Metrology as a whole have 11 offices and 26 local certified partners with a significant participation in this region. What are the key benefits offered by Hexagon? What are the potential sectors for business in Brazil? What are the main challenges faced in Brazil? Leica Geosystems has very comprehensive range of products. How do you propose to integrate them and position them in South America? For Leica Geosystems, South America is the smallest territory in terms of revenue, if we look at the whole scenario. Only 3- 4 percent of the annual revenue comes from this region whereas the opportunities are quite high. So how do you plan to tap the market? What are your future plans for Brazil? Would you be investing more time in getting solution for clients? Do you see any threat from low-end markets? |
Poor coordination and cooperation: The industry suffers from a lack of inter-organisational cooperation, coordination and collaboration. Numerous agencies working in the field pursue their work in an independent fashion, with very little cross-agency coordination on a formal, accountable basis. Governments are traditionally immature in their thinking and actions, hindering industry development and the roll-out of pragmatic solutions for stakeholders.
Heavy taxation and import duties: Tax burden is heavy across Brazil in terms of tax rates and administrative complexities. Heavy taxation, the huge variety and complexity of tax categories as well as the conflict and contradiction among one another poses significant challenges to the companies, says Eng. Marcos Guandalini, Sales Director, Alezi Guandalini. In addition to federal tax, state tax and city tax, enterprises also need to pay for various types of social expenditures. Typically, taxes amount to 71.1 percent of the gross profit per year for a medium sized enterprise.
Challenges faced by users: Users have their own set of challenges. Since the country took to mapping very late and not very sincerely, the quality of maps for vast areas of the country is very poor, particularly for ecologically sensitive areas like the Amazonia region (for which there are no maps available in any scale). Lack of updation is also a challenge, with most of the maps being approximately 30 years old and professionals such as planners, engineers and geographers needing updated documents to develop their work. Also, being a relatively new industry, there is an understandable lack of trained manpower. Initially the manpower may be brought from outside but in the long run the need for trained manpower needs to be met locally. While manpower demand is sufficient for low and medium levels, the paucity is more pronounced at high levels.
Other key challenges faced by users are interoperability and standardisation and lack of data centralisation. Organisations regularly use spatial data collected from a variety of sources; they often face the need to re-format and re-standardise data to make the information compatible with existing systems. The country faces a lack of effort in efficiently integrating and managing centralised data. Lack of centralised data can result in significant inefficiencies and suboptimal operational and long-term management strategies.
PRECAUTIONS AND DIRECTIONS
Challenges notwithstanding, Brazil has a lot going for it and is all poised to emerge as a key geospatial destination to reckon with. A few investments would go a long way towards this end.
Land of opportunities: The opportunities in Brazil are vast, particularly considering that there is no one vendor who is a leading seller in more than two segments out of major market segments, namely government, education, environmental management, agriculture, oil and gas, mining, forests, water resources and utilities. According to a report by Intare Consulting in Information Management, in the last few years, growth in the number of companies operating mainly in services associated with data and software with various solutions for different segments of market has been more than 40 percent, indicating that growth can be achieved by increasing the ability to offer solutions for integrated services.
High growth potential: The outlook for the geospatial industry in the coming years remains bright. As far as software vendors are concerned, according to Iara Musse Felix, Director, Santiago e Cintra Consultoria, there are significant differences when one considers GIS solutions and systems for image processing.
But the path to achieving this kind of growth is slightly complicated. In this context, the initial route may be that of providing free promotional software designed to aid the ongoing projects, thereby establishing credentials and trust, Iara adds. After securing public trust and appreciation and establishing some sort of recognition, the more formal market strategies may be implemented in the market.
The growing demand for integration between GIS systems and corporate management systems in national and international context is highly sensitive to quality requirements and performance. This realisation highlights the need for strategic partnerships so that the needs of increasingly complex and demanding users are met, opines Marcos Covre, Executive Director, Imagem.
Second mover advantage: Brazil is well placed to secure the second mover advantage in the geospatial field and be spared the false starts and unprofitable ventures. Helder Carvalhais, Director, Threetek opines that the advantages of the geospatial technologies are already well understood and the progress path of the industry is already well laid out.
Long term strategies: One of the primary roles of the industry is to be innovative and consistently bring new and better solutions to the market place. The best possible way is to think long term and bring solutions to markets rather than just products. It is important to play a responsible role by creating a level of education and knowledge about geospatial technology and not merely to work towards increasing the turnover.
Investment in understanding market dynamics: Studying, analysing and understanding a specific market is necessary to consider the dynamics of the market, its level of maturity and evaluate trends and changes. It is also important to consider the needs of different users of different segments to guide them.
Localisation of manufacturing and product development: As in any other market, the success or failure of any business enterprise in this region will be decided by the ability of the companies to give solutions to the challenges of the local industry.
At this juncture the uniqueness of the country may also be emphasised. Therefore the customisation of solutions to the needs of the people constitutes an important step towards the development of the industry in Brazil, says Heber, Chief Executive Officer, Geoja.
HUMAN RESOURCE CAPITAL
In Brazil, education and training in geo-information started in the beginning of 1970s, with the National Institute for Space Research-INPE starting a Masters programme in remote sensing.
Today, cartography engineering courses are being offered by the Federal University of Pernambuco-UFP in Recife (NE region), two courses in Rio de Janeiro, at the State University of Rio de Janeiro-UERJ and at the Engineering Militar Institute-IME. There is also a course in the State University of São Paulo-UNESP, in Presidente Prudente Campus and other in the Federal University of Paraná-UFP in Curitiba. All these institutions are involved with cartography, remote sensing, photogrammetry and GIS, mainly the UFP and IME. Marcos Covre informs that Imagem offers courses for GIS students.
CONCLUSION
Brazil as a country is poised to grow and grow to its true potential. In addition to its natural resources, the country has unparalleled human resources with a unique distinction of cultural values and co-existing spirits. Democratic political set-up and visionary leadership has made its mark and intent to play a key role in world politics and economy. Successful bid to host World Cup in 2014 and Olympics in 2016 is an indication of the quest of Brazilians to find their due position and role in world affairs. What is often considered as laid back attitude of Brazilians can be an asset instead of weakness as it allows process of consultation and paves the way for consistency. Being a democratic country, it is very important to have consensus building through consultation with different stakeholders and the same needs time and consistency. Undoubtedly speed is important, but what is more important is collective view and consistency of direction.
Senior Manager – Conferences, [email protected]
