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Development & Roles of Clusters (Rio)

Rio de Janerio is known for their famous statue of “Christ the Redeemer” and beautiful landmarks,  but they are also known as a city full of growing technology. Information technology has been starting to form with their own variety of clusters that range with federal government support, incubation program, technology parks, and Federal Universities. Rio consists of 6 major universities and 47 private schools for advanced learning.

The incubator program’s goal for Rio de Janerio start-up companies, is to strive for the following:

                                     ■To strengthen start-up companies

                                     ■Provide network assistant

                                     ■Provide affordable office space

                                     ■Establish partnerships with governments or other companies at different levels

One of the incubators that resides in the land of Rio is The Technological Incubator for Popular Cooperatives also known as ITCP, is part of the Rio de Janeiro Federal University that began in 1996 to start the mentoring program for job seekers in need of help.

ITCP continues to grow with partnerships in all variety of levels such as local, national and international. The partnership network consists of other universities and partners with different companies such as 16 Brazilian Universities, 22 American Universities, and 14 other companies throughout Brazil.

●     Financial  (Rio)

Rio de Janeiro holds the second most important and richest city that Brazil holds for wealth after Sao Paulo.  The city holds a variety of headquarters from private and national companies, National Economic and Social Development Bank, federal investment banks, and State Oil Company resides in the Rio metropolitan area. Rio also owns many of the port facilities for import-export goods. .

According to the Brazilian Institute of Geography and Statistics, Rio’s wealth reported at R$ 140 billion in the year of 2007 which is 5.4% of the national total. As the second largest hub of national wealth, oil was discovered in Rio which produces most of the total oil production of Brazil. The three major branches of gas companies are based in Rio de Janerio such as Esso, Shell, and EBX.

Rio’s major income for the city is mostly on retail trade with many shops located in the city include high trade, but their city is also known for a major attraction for tourism such as the famous known beaches of Copacabana and Ipanema. The city attracts many visitors with historical sites, physical land, and museums.

Challenges (Rio)

Technology

The president of the Brazilian IT Industry Association, Antonio Gill, mentioned the struggle in the IT industry is the marketing to the rest of the world. Rio de Janerio is known for a great tourism attraction, but needs to improve their marketing and prove their IT sector is as strong as China and India. Rio de Janerio wants to be taken seriously with their technology sector and is figuring out a way to market themselves better.

Economy

The collection of taxes in Rio de Janerio is 23.38%, which doesn’t include the other taxes that the state government takes away from their residents. The tax is not consistent and changes approximately six months, which could be a challenge for the residents that are trying to start their own company.

Internationalization

Brazil’s Universities is struggling to have academic professors from other countries to teach in their universities. One of the professors points out,“ they think it's an academic wasteland” and Brazil does not have a strong reputation of their outstanding academic program and is not taken seriously. Also, students tend not to pick Brazil for their first choice for study abroad.

BNDES

The Brazilian Development Bank (BNDES) was founded on June 20th, 1952 and headquartered in Rio de Janerio, Brazil. As the second largest bank in the world it is a state-owned company under private law, with their mission stated “To foster sustainable and competitive development in the Brazilian economy, generating employment, while reducing social and regional inequalities.”

The bank supports financial areas such as innovation, local development,  socio-environmental development, foreign trade and covers a variety of company sizes. BNDES also tries to  make the capital and private companies stronger, financing of exports, and capital market developments. Today, the bank has not only branched out among Brazil, but have globalized with other offices around the world such as London and Uruguay.

BNDES system consists of three internal areas that make up the banking system such as FINAME, BNDESPAR and BNDES Limited. FINAME is responsible for exports of Brazilian machinery and equipment, financial operations, and import of goods. BNDESPAR is responsible for the business aspect with distributing the capitalization process under private groups.

●     Requirements for establishing incubators in Rio

○     A supply of interested and qualified entrepreneurs

○     Technical and commercial viability of proposal

○     Partners committed to the enterprise

○     Committed community presence of incubator management

○     Local involvement and political support for the incubator

○     The availability of laboratories and human resource

Further advisable requirements:

                     ■        Adequate physical space

                     ■        Appropriate incentives and a secured line of credit

                     ■        Private - sector management of the incubator and minority Government participant that gradually decrease over time

                     ■        Ideal market timing of tenant projects

                     ■        Sitting incubators inside associated institutions of learning and research (except for traditional industry incubators)

                     ■        Affiliated professionals with a track-record in generating technology -based business (except for traditional industry incubators)

●     Resources shared between tenants

●     Government  Strategy for  Assisting Business Incubators in Rio

○     Selective contribution of resources: federal support would be conditional upon support from the private sector, universities, and resources from state and local government;

○     Sustainability - the incubator will have to prove it has the ability to support itself and to avoid chronic reliance on resources from the government;

○     Coordination among the financing  entities- to ensure optimum allocation of resources and sharing information;

○     Inducements: to trigger the incubators’ demonstration effect, facilitate the adoption of technological innovations, and allow investment in greater number of enterprises;

○     Evaluation: to determine future funding eligibility and needs;

○     Regional socio-economic reality: an incubator must play a role in an overall regional policy, including measures fostering the emergence of a culture of entrepreneurship;

○     Advance probing of events: to facilitate the exchange of information and to ensure allocation of resources;

○     Full service: preferential support to entities that manage incubator resources, passing the benefits along the businesses, while evaluating the results.

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