In The Media

“We are repulsed by this government”: Brazil’s wealthy are fleeing the country

by Miriam Kreinin Souccar (feat. Robert Muggah)

Quartz
April 19, 2016

Protests against the government are raging on the streets of Brazil’s major cities and its president is facing impeachment. High above the streets, in the posh living rooms of gated apartment buildings across Sao Paulo and Rio de Janeiro, upper class Brazilians are talking about leaving the country for good.

Latin America’s largest nation has long had its ups and downs. But the current corruption scandal engulfing the government, coupled with increasing violence and the deepest recession in decades, has tipped some over the edge.

Brazil’s economy is set to contract 2.95% this year after shrinking an estimated 3.71% last year. Consumer confidence is at a record low. At the peak of the crisis in September, the Real went from 2.7 to 4 against the US dollar. Now it is at 3.6. And as if things weren’t bad enough, Brazil is now one of the most murderous countries in the world. One out of every 10 people who are killed anywhere is Brazilian, a murder rate that’s higher than Syria.

“There’s a growing anxiety, pessimism and even despair amongst Brazilians now, and it’s magnified by this idea that it’s not clear when this crisis will end,” said Robert Muggah, a research director at Instituto Igarape, a Rio-based think tank. “For those with the means, there is a sense that it’s time to leave.”

Exact figures of how many Brazilians have emigrated or are in the process of getting a visa, are not available. But analysts, immigration experts, and real estate agents, say large numbers of them are laying down roots in the US, which now offers special visas for foreigners who open businesses or park a sizable amount of assets here. Their city of choice is Miami, which has a Latin culture and is the closest to home. But Brazilians are also moving to other American cities, Canada, and for those in the Jewish community, Israel. (Some 400 Brazilians emigrated to Israel last year, a small proportion of the 120,000 Jews living in Brazil, but more than double the number that moved there in 2011.)

Genilde Guerra, an immigration attorney in Miami, said she has seen an increase of around 30% in the number of wealthy Brazilian clients in the last year, and she expects that number to grow as the political crisis wears on. The majority of her clients are opening businesses or expanding their existing business to the US. Some are also applying for the EB-5 investor’s visa, which requires foreigners to invest $500,000 to $1 million in the US.

“People who had no interest in the past are coming now,” Guerra said. “They don’t trust the government and they want safety and comfort for their children.”

Joao, a Sao Paulo businessman who was only willing to give his first name, is in the process of getting a visa now. He’s expanding his consulting business to Miami and moving his family there. He said all of his friends are filling out paperwork for the EB-5 visa and preparing to move.

“In the US there is justice and rules,” Joao said. “Here we don’t have that. Security is a major issue; the government is going to fall. It’s a mess in Brazil.”

Jennifer Santos Sily, a real estate attorney at Becker & Poliakoff in South Florida, said just a year ago the majority of her Brazilian clients were purchasing vacation homes. In the last six months or so, that has changed.

“Now they are purchasing property for the purpose of relocating here,” Santos Sily said. “And while they used to use financing, now they are paying cash.”

Real estate professionals say they are surprised by the large number of Brazilian buyers now, because the Real is so weak. “They double their expenses to come here, but they are still coming,” Guerra said. “The dollar hasn’t been a deterrent.”

Brazil has ranked as the top foreign nation searching online for South Florida real estate in 17 of the last 18 months, according to the Miami Association of Realtors. And Brazilians were among the top three purchasers of Miami real estate among foreigners, along with Venezuelans and Argentinians last year. Mark Sadek, the association’s chairman, said most of the incoming Brazilians are upper-middle class families. They spent an mean average of $587,700 on Florida real estate last year.

Indeed, the bulk of Brazilian migration to the US and Canada used to come from the working class. Middle and upper class families in Brazil were loathe to give up the live-in maids, cooks, and often multiple nannies that they could easily afford in Brazil. Their kids are chauffeured to after-school activities by private drivers. Hair stylists, manicurists, and massage therapists come to your house. But now they’re willing to give all of that up.

“People who have the conditions to leave aren’t thinking twice about it,” said Myrna Porcaro, a top Brazilian architect and interior designer who relocated to Miami in November, and is now working with around 30 Brazilian families who have recently moved.

Porcaro, who is divorced and bought an apartment near Miami’s design district, said she had grown used to the security issues in Brazil and that wasn’t the overarching reason for her move. For her and most of her friends who are leaving now, it’s because of the political scandal.

“We are repulsed by this government,” she said. “We are discovering now how much they stole from us and how much they lied. In the US you have a lot of taxes, but the government doesn’t steal your money.”


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