This is a best prospect industry sector for this country. Includes a market overview and trade data.
Last Published: 8/10/2017

Overview

Safety and Security in Brazil

 

2014

2015

2016 (estimated)

2017
(estimated)

Total Market Size

$24,000

$26,000

$28,600

$26,240

Total Local Production

$20,400

$23,100

$25,300

$22,270

Total Exports

$180

$170

$187

$170

Total Imports
(Electronic Products)

$3,600

$3,900

$4,290

$3,800

Imports from the U.S.

$1,600

$1,800

$1,980

$1,800

Statistical data are unofficial estimates from trade sources
- Note: exchange rate US$1 - R $3.1
- Unit: US$ thousands


Brazil has an extensive and well-developed security market that should be followed closely by U.S. companies. Despite political and economic uncertainties which have featured over the last two years, Brazil continues to experience double digit growth in this sector.
 
While the current economic recession is projected to continue through 2017, a slow recovery is expected to unfold into the latter half of 2017, as confidence in macroeconomic policies improves. Spending related to the Olympics and the World Cup has prioritized security services and products, and it is set to continue in the near future. Investments have been made in mass transport systems, with funds being spent on both roads and airports to increase their efficiency, security, and capacity.
 
Opportunities for security suppliers will continue to emerge, as the government continues to focus on infrastructure development in order to drive GDP forward. Local analysts anticipate that the market for security technologies across a wide range of critical national infrastructure segments will continue to grow as the country continues this internal development.
 
The 2013 riots in São Paulo, Brasilia, and Rio de Janeiro highlighted the social instability caused by a lack of spending on social projects and the high cost of hosting international sporting events. This instability and threat from organized crime incentivized the Government of Brazil to invest in security infrastructure.
 
Brazil has registered an average annual growth in the security sector of 15 to 20 percent for the last eight years with annual sales around US$26 billion, which includes private security services. The market for electronic security equipment alone, accounts for US$592 million and is expected to more than triple to US$1.8 billion by 2017. Foreign products account for approximately 50 percent of the electronic security total market share, with U.S. products representing half of these imports.
 
The largest clients in the security market are the Government of Brazil (GOB), and financial and commercial institutions. Large investments in the country’s military modernization program are key drivers in the Brazilian security market. Over the next decade, government security programs aim to strengthen border controls, combat organized crime, improve the prison system, create a National Information System for the public security agencies, and reduce crime and the flow of drugs.
 
At the state level, the public security secretariats are also promoting investments in the acquisition of new technologies. Command and control centers have become the “brain and the heart” of the state police agencies, which need to be able to quickly analyze and coordinate responses to ensure the safety of delegations, sports teams, tourists, etc.
 
As in most other industry sectors, to be successful in Brazil foreign manufacturers must either establish themselves in the country or have a local representative. The GOB and the private sector prefer to contact a local representative to handle all import procedures through them, instead of contacting foreign suppliers directly. 
 
Leading Sub-Sectors
 
Below are the areas that currently present the best prospects in the Security market.

Brazil Best Prospects in the Security Market

 

Surveillance Equipment

Access Control

Security Systems

Detection Devices (drug, fire, metal)

Unmanned Aerial Vehicles

Cyber Security (hardware, software)

Personal

Personal security, access control, alarm systems and surveillance circuits

Residential Buildings

 

 

 

Home Security

 

 

 

  •  

Commercial

Personal security, access control, alarm systems and surveillance circuits

Airport Security

 

 

Banking Institutions

 

 

Public Safety & Security

Surveillance equipment e.g. UAVs, emergency response integrators and professional training

Mass Transportation

 

 

 

Government

 

  •  

 
According to the latest Security Industry Association’s (SIA) report, the Brazilian market for electronic security equipment is expected to reach US$2.0 billion by 2018. The current market breakdown is as follows: 

  • Video Surveillance – 39.6%
  • Access Control – 20.8%
  • Intrusion Alarms – 19.2%
  • Fire Detection and Suppression – 10.4%
  • Electronic Surveillance – 10%

 
Geographically, the security market is concentrated in the south and southeast regions of Brazil, where 63.4 percent of security companies and 65.5 percent of personnel can be found. Outside these regions, other states such as Bahia, Ceará, Pernambuco, Goiás and Distrito Federal (due to purchases made by the Federal Government) also deserve some attention.
Anti-virus specialists’ report from Symantec estimates that cybercrime in Brazil accounts for 60 percent of all cybercrimes in Central and Latin America. The total price tag of consumer cybercrime in Brazil is approximately US$8 billion. 
 
Opportunities
 
The Brazilian cybersecurity market is expected to grow from US$2.61 billion in 2013 to US$7.29 billion in 2019, at a CAGR of 17.80 percent for the reported period. The market is primarily driven by huge investments in military modernization programs. Micromarket Monitor produces a Brazilian cybersecurity market report, providing competitive benchmarking of the leading players in the industry as well as market trends, overall adoption scenarios, competitive landscapes, and key drivers, restraints, and opportunities in this market, estimating the current size and the future growth potential across different types, solutions, and services.
 
The Center of Cybersecurity (CDCiber) began its operations in 2010, and was created within the Brazilian Army in the Ministry of Defense, to study cyberspace threats, establish national doctrine on the subject, improve and monitor the means of defense against these threats, including investments in hardware and software, and to protect Brazilian cyberspace. This organization works in collaboration with other government organizations, including the Office of the President and Federal Police. CDCiber already coordinates projects with universities, as is the case with the agreement with UNB in the operation of the National School of Cyber Defense (ENaDCiber), in addition to maintaining links with government companies, such as Brazilian Federal Service of Data Processing (SERPRO) and private developers of technology.
 
As a result of the continuous reduction in the price of electronic monitoring devices, the Brazilian Association of Private Security Guards noted an increased deployment of such devices, particularly in private security. Electronic monitoring devices are being used in support of private security services, in some cases, replacing the presence of a private guard altogether. Without considering the effectiveness of this market trend, local market experts indicate a potential opportunity in the use of electronic devices in support of local private security companies, especially for those companies that have a good critical mass of customers and could act as "cross selling " dealers of new products and services for their existing clients.
 
The use of non-lethal weapons, such as stun guns, has been growing year after year, indicating a market tendency across both the public and private sectors. Non-lethal technology companies have witnessed revenue increases above 30 percent and the overall government policy towards the use of less harmful devices are expected to prompt more sales.
 
The continuous struggle over the last 20 years in Brazil to effectively address high levels of crime and violence should generate a bigger market for security technologies across a wide range of critical segments.
 
Vehicle surveillance is another market segment that has seen rapid growth over the last few years.  According to the press, more than 500,000 cars are stolen in Brazil every year, and in large cities like São Paulo and Rio de Janeiro, car hijackings occur every few hours.  Additionally, cargo robberies are a problem. 
 
Other promising niches are small businesses and private homes as high crime rates force individual citizens and business owners to increase their security expenditures.  These end-users, however, usually buy less expensive and less sophisticated equipment.  Specialists estimate that Brazil has around seven million homes that should have some type of security device, but only seven percent are equipped with electronic security systems.
 
Financial institutions are the market’s main end-users, and the most sophisticated consumer niche, demanding quality, warranty, and after-sales service. Port and airport security is another high-quality segment, which although they have continuously implemented improved security measures, should continue to offer excellent opportunities for U.S. suppliers as Brazil continues its concession logistic program.
 
Market Entry                                        
 
The largest clients in this market are the GOB and financial/commercial institutions, which supply the national public security sector. As in most other sectors, to be successful in Brazil, foreign manufacturers must either establish themselves within the country or have a local representative.
 
The GOB and the private sector prefer to contact Brazilian representatives and do all the import procedures through them, instead of contacting the foreign suppliers directly. It is also important to have a distributor who can offer post-sales, maintenance services, replacement parts, and repairs.
 
Due to the size of the country, most distributors and system integrators cover only specific regions. They are usually small to medium-sized companies that the lack financial capability to invest heavily in product promotion, technical training, and translation of technical manuals. Therefore, it is often important that U.S. companies provide financial support for some of those activities. U.S. companies who have seen the greatest success in Brazil have worked closely with their agents and distributors, investing heavily in personnel training.
 
The Brazilian Army, through its Supervisory Board of Controlled Products, exerts the control over activities involving the acquisition, transportation, importation and exportation of small arms and light weapons, ammunition, and other related public security products - including non-lethal equipment. Prior to exporting law-enforcement related products, our office advises U.S. companies to contact the U.S. Department of Commerce for information regarding the products that fall into the Brazilian Army control.
 
Limitations on selling U.S. Products and Services
 
Technical literature must be translated into Portuguese. Although there are no official regulations and technical standards for electronic security equipment, the Brazilian Association for Electronic System Companies (ABESE) issues sector-specific certification called the “Yellow Stamp of Quality”. This certification is issued to companies in the electronic security sector, including manufacturers, distributors, and service companies.
 
When signing an agent or distribution contract with a Brazilian firm, it is important to use the services of local law firms that are familiar with Brazilian legislation. Commercial distribution contracts are regulated by general Brazilian commercial laws - not by specific legislation. However, there is a special legislation that regulates the relationship between a foreign company and Brazilian agents or sales representatives. According to this legislation, if an agency contract is broken, the monetary compensation owed by the U.S. party usually favors the local agent.
 
Web Resources

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For more information about export opportunities in this sector, please contact US Commercial Service Industry Specialist: Genard.Burity@trade.gov

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Brazil Safety and Security Trade Development and Promotion