With a devalued real, remittances from Brazilians abroad set a record

BRASÍLIA – Roberlei Cardoso, after retiring as a commercial representative in Cascavel (PR) in 2015, went to London to work in the real estate sector. He and his wife Leila Previati, who works in a restaurant in the British capital, have always considered successful financial life in the land of the pound. But recently, they’re struggling to save every penny — or penny.

The reason? Send as much as possible to invest in Brazil, taking advantage of the strength of the pound against the real to pave the way for a comfortable return to the country.

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Like them, other expatriates are sending more resources to Brazil to buy real estate and invest in businesses, seeing the money they earn abroad is worth more here with the strong and prolonged devaluation of the real.

According to data from the Central Bank, remittances from abroad hit a record in the first half of this year, totaling US$ 1.89 billion, equivalent to R$ 10.16 billion.

It is the highest value in BC’s historical series, started in 2010, and an increase of 24% compared to the same period in 2020 and 36.5% compared to 2019, when a pandemic was not even thought of.

— When the pound was worth R$ 5 between 2018 and 2019, it was already very good. But when it started to reach almost R$ 8, it was time to send everything we had to Brazil — says Cardoso, 58, who has been buying real estate in Brazil with the advantages of someone who earns in a currency that it ended last week at R$7.33 and reached R$7.93 in March.

And adds:

— The goal is, when we return to Brazil, to have a better standard of living than here. Buying real estate is the way to sustain yourself when old age arrives.

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a lot of weak real time

Converting the figure sent by Brazilians abroad in the first half of the year, just over R$ 10 billion is equivalent to the three-month budget for Bolsa Família and emergency aid, which helped to reduce the impacts of the pandemic on the economy.

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Since 2004 in England, immigration lawyer Tiago Soares, from the Ashton Ross Law firm, says that remittances to Brazil tend to increase when the real depreciates, but now the movement is more intense:

– Nobody imagined that the exchange rate would stay so high for so long.

BC data pointed to records between January and June in the sending of funds from three countries that have large Brazilian communities: USA (US$ 946 million), United Kingdom (US$ 370.4 million) and Canada (US$ 27.9 million ).

From Portugal, another popular destination among Brazilian immigrants, came US$ 101.3 million, in the sixth consecutive semester with remittances above US$ 100 million.

For Julia Braga, professor at the Faculty of Economics at the Fluminense Federal University (UFF), this phenomenon is due to several factors. The first is the economic crisis caused by the pandemic, which brought down the income of many families in Brazil and encouraged immigrants to send more money to their relatives.

The second is the devaluation of the real, which creates investment opportunities here for those abroad. Julia also cites the lack of economic prospects in Brazil, which encourages more people to leave:

— There is this volume of people who left in search of new opportunities who, when they earn income, start sending more resources to invest or help relatives in Brazil. I see the Brazilian crisis as an important factor.

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In addition to the real estate market, other investments in Brazil attract the valued money of expatriates. Lúcio Santana, who works in real estate financing in Deerfield Beach, Florida, says that he has just bought 50% of a school in Campo Limpo Paulista (SP), from which he left 23 years ago to live in the USA.

He has no plans to return to live in Brazil, but he saw the strengthening of the dollar against the real as an opportunity to invest in an education business in his homeland. The American currency rose again and ended last week at R$ 5.38.

— I don’t think about going back, but I always dreamed of having a business in Brazil. This investment can make a difference in my city – says Santana.

Lúcio Santana works in real estate financing in Deerfield Beach, Florida Photo: Personal archive
Lúcio Santana works in real estate financing in Deerfield Beach, Florida Photo: Personal archive

It’s easier to help

Mason Sílvio Ramos de Melo, 52 years old, also hasn’t thought about returning to the country since he settled in Cascais, Portugal. Although he prioritizes his nest egg to have more peace of mind in his new life in Europe, with the euro at around R$ 6.30, he has managed to send money to fellow countrymen in difficulties in Brazil:

— Sometimes a brother, a relative or a friend asks for help, asks for R$1,000. Before, I needed almost €250 to spend. Today, I send € 150. It’s a day of work here, worth more than a week for people who stayed in Brazil — says Melo, born in Teresópolis (RJ).

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José Ribeiro, owner of Prima Transfer, in London, mainly serves Brazilians who want to send money back to their homeland. He says that demand has increased a lot since last year to buy real estate and make other investments in Brazil, not only because of the exchange rate advantage:

— Since the country is in crisis, business opportunities increase.

Adilson Goes, who left São Paulo for Boca Raton, in the American state of Florida, and works at Fair USA, another fund transfer company, also says he has seen Brazilian expatriates fulfilling their dreams with a little push from the exchange rate:

— A Brazilian who came here compared the value he had in dollars and realized that he could buy a farm in Brazil, his dream. After the dollar rose further, he still sent the money to buy the heads of cattle.

Adilson Góes left São Paulo for Boca Raton, in the US state of Florida Photo: Personal archive
Adilson Góes left São Paulo for Boca Raton, in the US state of Florida Photo: Personal archive

André Linhares, Florida immigration attorney, corroborates:

— The type of immigrant who is here to play the game and return to Brazil in the future is taking advantage.

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The increase in remittances also creates opportunities in Brazil, where the side that receives the money is located. Daycoval bank has seen the use of DayPay, a service that makes it easy to send international remittances, exceed 50% of its retail foreign exchange business. It opened new stores for cash receipts in São Paulo, Brasília and Goiânia and plans to reach other cities.