Brazil annouces R$3 billion to attract R&D&I centers

 A "public call" has been announced in Brazil to select proposals for attracting, establishing, or expanding Research, Technological Development, and Innovation (R&D&I) Centers in the country. The initiative is led by the governmental agency Finep (Funding Agency for Studies and Projects) and BNDES (National Bank for Economic and Social Development).

The call offers R$3 billion (517 Million Dollars) to support research centers through various means, including credit instruments, equity participation, non-reimbursable funds for cooperative projects between companies and Scientific, Technological, and Innovation Institutions (ICTs), and economic subsidies, all managed by Finep or BNDES. The execution period for the proposals can be up to 36 months.

The projects must involve the establishment or expansion of proprietary R&D&I centers to conduct research, technological development, and innovation activities related to at least one of the missions of the New Industry Brazil (NIB), the federal government’s industrial development policy. Furthermore, Finep specifies that the projects must require credit exceeding R$10 million for centers to be established or expanded in the North and Northeast regions of Brazil, and above R$20 million for other regions.

In addition to Brazilian companies, the public call is open to proposals from foreign companies interested in bringing technological expertise to Brazil, according to Finep. "This is a great opportunity for companies worldwide to look at and invest in the opportunities Brazil offers," the agency states.

According to Finep’s definition, R&D&I Centers are "facilities that include laboratories, pilot plants, demonstration plants, and other installations exclusively dedicated to research, technological development, and innovation activities. These activities encompass basic and applied research, product development, testing, and validation, as well as collaboration with universities and other institutions."

"This is yet another important initiative to encourage investments that promote the country’s technological and economic development," said Finep President Celso Pansera. He believes that R&D centers play a central role in attracting and retaining high-skilled jobs that raise income levels and economic complexity. "Large research centers also attract an entire chain of qualified suppliers, generating a virtuous cycle of growth and innovation," he added.

"The centers accelerate the launch of new or improved products and services, enhancing competitiveness, complexity, and diversification of the Brazilian economy. Brazil has significant scientific expertise, trains qualified professionals, produces knowledge and has physical facilities and a diverse range of research institutes. It ranks 14th in the world (2023), but still has a long way to go in transforming these assets into innovations for companies and retaining talent," said BNDES President Aloizio Mercadante.

The Brazilian Chemical Industry Association (Abiquim) told AgroPages that it "received the announcement from BNDES and Finep with enthusiasm." According to André Passos Cordeiro, Abiquim’s executive president, the association sees this call as a significant opportunity for the Brazilian chemical industry to fully explore its technological, innovative, and economic potential, particularly in decarbonization.

Cordeiro emphasizes that the Brazilian chemical industry operates with clean and sustainable energy, with 83% of its energy coming from renewable sources. Depending on the product, it generates half the CO₂ emissions per ton produced compared to its main global competitors. "We are talking about an economic sector uniquely positioned to build a fairer, more humane country that genuinely contributes, through science and technology, to solving the major challenges humanity faces today," Cordeiro states.

According to him, with its renewable energy matrix and abundant natural resources, Brazil has great potential to lead the green chemicals market. "By offering incentives and subsidies to companies developing clean technologies, the Brazilian government can strengthen its industry and create high-skilled jobs while aligning the country with global environmental demands, ensuring greater safety for the environment and human health. This strategy not only drives sustainable growth but also positions Brazil prominently in the international market, securing its competitiveness in the 21st century," the Abiquim president stresses.

R&D&I Around the World

Government incentives for R&D&I activities play a crucial role in attracting research centers from multinational companies, with significant variations between countries. China and India offer direct incentives focused on specific sectors, such as electronics and pharmaceuticals. Japan and the Netherlands provide tax benefits. In the United Kingdom, companies—especially micro, small, and medium-sized enterprises—can receive R&D&I tax incentives of up to 175%, while large companies receive 130%, with the option to use future credits or receive reimbursements of up to 24% of eligible expenses.

Brazil currently ranks 49th out of 132 countries in the 2023 Global Innovation Index (GII). Despite this progress, the ranking is still considered low relative to the country’s potential, given that it is among the world’s 10 largest economies.

(Editing by Leonardo Gottems, reporter for AgroPages)