ADIG Plans More Investments in Brazil

Brazil, especially its capital Rio de Janeiro, can expect an investment of more than $19 billion from the Abu Dhabi Investment Group (ADIG), a sovereign wealth fund backed by Abu Dhabi government in the coming days.

During his visit to Brazil three months ago, ADIG CEO Sheikh Zayed Bin Rashid Bin Aweidha Al Qubaisi presented an infrastructure development plan to construct projects including a subway and trains, which could generate high returns for the local government.

This investment includes contributions to pasture restoration, industrial development, export of agricultural products, infrastructure projects and even defence. This promise materialised in an announcement about the creation of a fund with this amount, made last month.

Al Qubaisi presented a plan to Rio de Janeiro Governor Claudio Castro for investing in transportation and the redevelopment of favelas in Baixada Fluminense and São Gonçalo, expanding Metro Line 4. It is a project that could require investments of up to $19 billion.

Mubadala capital already operates in the Rio subway by controlling the concessionaire of Line 4, the ADIG investment group can expand this presence by bringing its expertise in urban development to boost growth in the surroundings of the capital of Rio de Janeiro, further strengthening the country’s investments in the state.

ADIG also promised to invest $500 million in local businessman Eike Batista’s super sugarcane project, which resulted in the creation of the company BRX.

ADIG, which currently manages assets worth over $350 billion, sought out projects around the world and was part of the project that created Malaysia’s new administrative capital, Putrajaya, where the country’s federal government moved in 1999.

In an exclusive interview with local daily Estadão recently, Al Qubaisi sees opportunities in several sectors in Brazil. Excerpts:

What is the UAE’s investment potential in Brazil?

We see opportunities in the infrastructure, oil and gas, and export sectors. For the UAE, Brazil can also bring good cooperation for food security, with investments from other groups, not necessarily from ADIG. I, personally, have been discussing with the governor of Rio de Janeiro some investments for the city of Rio and its surroundings.

I have also discussed the possibility of redeveloping urban areas with subways and high-speed trains, and providing alternative housing for favelas. It is possible to bring roads, subways and high-speed trains to redesign and connect cities near the capital of Rio de Janeiro.

Would it be a long-term project?

It is something that could be done very quickly. We were able to rebuild Putrajaya, the new administrative capital of Malaysia, in four years. With the support of the government, it could be done very quickly in Rio too. We have already seen this in the UAE.

We have revolutionized Abu Dhabi and Dubai, with the rapid development of the cities and major changes. It would also be no small feat for Rio de Janeiro. It could take the region to another level, with the potential to have a major impact on its economy.

How much investment would be needed for Rio de Janeiro?

It could be as much as $19 billion, but that is a number we cannot confirm until there is a more in-depth project. The government must provide us with more precise information so that we can estimate the resource needs.

ADIG was established 66 years ago and in addition to its work in oil and gas, it has developed the entire banking sector in the UAE besides providing the UAE’s entire financing structure, not only through banks but also through sovereign wealth funds, and then began to operate globally.

What was the group’s role in building the country’s infrastructure and can this be replicated in Brazil?

We did a lot of the construction in the UAE, including Abu Dhabi airport, and a subsidiary managed it until the government took over. The Al Dhafra air base, where the US operates was also built by ADIG. The Sheikh Khalifa Medical City was also our work. ADIG played a vital role in the country.

Brazil is a very large country, with many resources and a lot of potential for further development. It could be one of the most important in the world. We are a very small country with a large production.

Despite having a population of 11 million people, our GDP is 25% the size of Brazil’s, at $500 billion. In the 1960s, Abu Dhabi was made entirely of houses built with palm trees. Only one building had a more robust construction, and it wasn’t even made of bricks.

There was only one car in the city and people lived in the same type of buildings as 3,000 years ago. But now we are more advanced than many large developed cities. Our hotels and airlines are among the best in the world.