Investor Presentaiton

28 How to INVEST in São Paulo STATES 29 Capital Goods The capital goods sector accounts for the production of a joint complex of machines and equipment used in the production of other assets, maintaining a direct relationship with the production of the other sectors, in addition to playing an important role in the distribution and generation of new technologies. In 2008, according to the Brazilian Institute of Geography and Statistics (IBGE), São Paulo accounted for 59% of the Industrial Transformation Value (VTI) in this sector in the country, which is equivalent to USD 11 billion and to 55% of the employed personnel (214 thousand employees) in the sector. The capital goods sector is among the five main industrial activities in São Paulo State. The communication equipment, computer equipment and peripheral equipment sectors, along with the machines and equipment sector, have higher innovation rates than the transformation industry as a whole. Highlights: •The capital goods sector provides machinery and equipment to all the other industrial sectors; Activity responsible for large technology spillovers; The Institute of Technological Research and Development of the Machinery and Equipment Industry IPDMAQ aims at stimulating entrepreneurial actions in technological research and development, and promoting an environment which supports companies in their effort to create competitive services and products. Financial Services The city of São Paulo is the financial center of Latin America. The main financial institutions operating in the country are headquartered in the city, including the Brazilian Securities, Commodities and Futures Exchange (BM&FBovespa), the fourth largest in the world market capitalization. According to the Brazilian Central Bank, in December 2010, 30% of loans in the country were carried out in São Paulo. São Paulo is also the location of the majority of all financial services provided to the Brazilian market, taking into account bank, insurance and securities operations. Highlights: • Latin America's largest financial center; The world's largest banks are located in São Paulo; • Special credit lines available to companies in specific sectors of the economy. Green Economy São Paulo State was the first in Brazil to incorporate green economy in its political and entrepreneurial agenda. The state has a low carbon economy profile and the cleanest energy matrix in Brazil, with a 54.7% participation in renewable resources and the largest sustainable transport plan in the country. By creating avant-garde laws, São Paulo was the first state to regulate issues such as solid waste (State Law number 12,300 of 2006) and climate change (State Law number 13,798 of 2009). Both laws open opportunities for new business prospects. Major initiatives related to green economy in São Paulo State: Green Economy Credit Line: "Nossa Caixa Desenvolvimento", the development agency of São Paulo State, finances projects for small and medium companies that promote the reduction of greenhouse gas emissions, contributing to a low carbon economy. International Green Economy Business Exchange: An international event in which the São Paulo State Government, representatives of the private sector (entrepreneurs, business people and institutional representatives) and civic organizations, both Brazilian and International, with connections to the green economy, meet. The International Green Economy Conference, The Government with Open Doors (community service) and The Business Exchange (an area for the presentation of technologies, products and services) will all take place simultaneously during the event which will have 2,000 participants from all over the world. Institutions: São Paulo is home to the Green Business Council and to the Brazilian Council for Sustainable Building. The state is also home to the largest basic sanitation (water and wastewater) company in Latin America (Sabesp) and the largest remaining reserve of Atlantic Forest in the world (the 315,000 hectare Serra do Mar Park). The park has reserves for sustainable development, a large quantity of genetic resources and a natural capital of inestimable value. With the recent movement towards a green economy, there are opportunities for the development of markets in all segments of the economy and in all stages of production. São Paulo is investing in the green economy as a development model of the present and of the future. This offers tremendous opportunities for investment, technological development and the generation of employment and income.

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