 I'd like to welcome you today to our session, Boosting Latin America's Infrastructure. At first, I'd like to introduce our panelists. Georgina Baker is the International Finance Corporation's Vice President for Latin America and the Caribbean, and Europe and Central Asia, a small area of the world. And in this role, she is responsible for a committed IFC portfolio of $22 billion. Joe Kaiser, President and Chief Executive Officer of Siemens, Germany. And Joe has 30 years of experience at Siemens with various leading management positions of business finance and strategy. Hedolfo Spielmann, Managing Director, Head of Latin America at CPP Investment Board of Canada. And Hedolfo is a member of the board's Latin American Regional Investment Committee and leads all investment activities in LATAM. And Mariana Luz, who is the head of the Embraer Foundation, not to be confused with the Embraer Aviation Company. And she's also the head of sustainability, I think, at Embraer Aviation globally. And I'm Joe Lei. I'm the Bureau Chief of the Financial Times here in Brazil. And I would like to say just how timely this session here today is, especially with how long it took me to get to this conference this morning through the traffic. So I think there's a few things that we need to solve here in Brazil. And I've been in Brazil now for seven years, and I can speak mainly of my experience here. And when I first arrived here, I studied Portuguese and Campinas. And for anyone who knows Campinas, it's a relatively small, very modern satellite city of São Paulo. And you can understand how this gave me a completely wrong impression about the infrastructure of Brazil. It's got fantastic highways. It's got a beautiful airport. So it's a bit of an exception. Overall, Brazil's infrastructure is actually quite patchy. If you look at the World Economic Forum's competitive rankings, Brazil ranks slightly higher for infrastructure at 73rd than its overall ranking, which is 80th. Once you look down into the numbers, Brazil's infrastructure is saved a little bit by the high availability of flights and also its strong telephone services. For the quality of roads and ports, Brazil actually ranks beyond 100. So it's actually, and the railroads are not that much better. So with this, I'd like to put our first question to our panelists. How can a new project pipeline of high quality and resilient infrastructure be financed? And I can think of no one better to answer this question than you, Georgina. Thank you very much, Joe. So IFC is very proud to be working for a very long time in Latin America and in Brazil. And we have a number of investments in the infrastructure space here. But what we have been focusing on most recently is how to crowd in other people's money, namely the private sector, namely institutional investors. And we have created a program that if I can talk about for a few minutes, where we have brought in three very large insurance companies, Allianz Prudential, and we're just about to sign finally with AXA, they have given us to lend on to our clients, half a billion each, so it's one and a half billion in total, where they are following IFC's investments. We sat down with them at the beginning and discussed which sectors and which countries they did not want to invest in. And once we had agreed on that, and that took a fair amount of time, once we'd agreed on where they did not want to go, they had to then follow us in every investment we did across our infrastructure book. And that was a big deal for very large insurance companies that no insurance, no infrastructure investment very well, but only in OECD markets. We feel more knowledgeable about infrastructure investments in emerging markets, and this was an area that they were unfamiliar with. So very familiar with infrastructure, very large balance sheets, very nervous about investing in emerging markets. And when they invested alongside IFC, they were much more comfortable. And I can talk about it more later on if you like, but it was for me the most exciting part of this is the demonstration effect. This is demonstrating that for large insurance companies from the West, Allianz and Prudential are in Paris in Germany and Prudential is from Asia, they can come with us to markets where they were very nervous and they're following us. And once they've done it with us, they will do it on their own and they will bring others behind them. And that to me is the most fundamental breakthrough that we've had, that these insurance companies, these institutional investors with very large balance sheets are beginning to look at emerging market infrastructure and realizing that they too can do that. I'll come back to that because I want to ask you why they were so nervous, but Joe, this question, how can a new project finance of high quality and resilient infrastructure be financed? Oh, well, I believe that answer has already been given. The point is to me is a bit different and I will take it on earlier. What does it take to bring infrastructure investment to a country? It takes, it needs a plan. And that plan needs to be set forth by the government. You know, how do I develop my country in infrastructure? What is my energy agenda? What is my mobility agenda? How do I efficiently transport people and goods? And then the financing will come because there is so much money in the world and all those pension funds and insurance companies and which just got mentioned, they are dying to invest but there's got to be a plan for localization, for innovation and then for economic development. And that's I guess been the challenge which Brazil has had in the last several years. They've been busy with other things. China has a plan. Now we can debate about China as much as we want in terms of democracy or the lack thereof but they have a plan. And they have been expanding their plan now from China to the whole Asian-European continent with the One Belt One Road or Silk Road Initiative. India has a plan, reform plan was more reported in place. There's been a few things which they can go the way it should have gone but for the most part it works. Both have 7% GDP growth. So now the first half of the brick, to the tail end seems to work well. First half of the brick, the BR needs to catch up. And that's why yesterday we went together with the government and signed an infrastructure MOU where we said, A, let's make a plan together. How do you develop your country? How can OEMs help with localizing and make it more efficient? And once that plan is in place people will come and invest. And insurance companies will place money to work in infrastructure investment because that's the best you can do because it goes with inflation, right? So it correlates with inflation and that's what you wanna have in your assets in the pension fund. So we need a plan for Brazil. And I truly do hope in conversations I had yesterday, the day before yesterday with the president and some candidates which are up for the running, goes exactly that direction. Get a government, let's go sit together with the ones who can help you and then make a plan for energy and infrastructure and then there is abundant money all across the world to flow into Brazil and there is economic growth. There will be industrialization because Brazil has a fascinating token, a buffer beyond 200 million people, young people and what have you and Samba and all stuff. Brazil's got natural resources. So Brazil sits at the very beginning of any industrial value chain. So you've got your iron, you've got your natural resources and you build the next level of the value chain. That's perfect. Germany can do that because we are sitting in the middle of nothing so we need to find people who've got the natural resources, where we can add technology and what have you. So I'm very optimistic about the country but the government now needs to act first and put the plan in place and then everything else will fall in place. So very optimistic but start at the root cause and don't talk the actions to get there yet. I'd like to come back to the MOU but first, Rudolfo, this question, how can a new project pipeline of high quality and resilient infrastructure be financed? Yeah, we are investors in infrastructure in Latin America with roughly six billion invested, six billion dollars invested in Latin America. Interestingly, we didn't start in Brazil, we started actually in Chile 2006 and these assets were still on today. So as long-term investors, we're very comfortable with the asset class of infrastructure and we buy to hold. Then we expanded into Peru, into Mexico, we're very happy with infrastructure investments there and last year we signed the first investment in renewable energy in Brazil with the Votorantin Group in a partnership. So, but these have been, this is just scratching the surface of what actually Latin America needs and Brazil needs for that matter. And I think typically what we think, there are some countries that have done infrastructure development very well just to pick one is Australia. And if you look at some of these countries what they did well, they do three things well. First, they create a pipeline of scalable projects and it's not just an initiative like for the next 12 months, we put a couple of projects together, put it on a marketing presentation, then you just sell it to the market. It's the whole mindset of bringing together different ministries, transportation, environment, finance and so forth, mining and energy, bring them all together behind a common agenda and create this pipeline of project across different sectors, across different industries and integrate the view and have one common goal of really making this the infrastructure pipeline takeoff and that has to be foreseeable. It has to be a timeline for many, many years. Ideally, exactly. Ideally over more than one government. This cannot be just a government or just a ministry. It has to be almost a conviction of the political class across political parties. So that's number one. Number two is actually these assets have to be available in a de-risk, at least for us in a de-risk fashion, meaning they cannot be green-field anymore because that's where the high risk is and where we as financial investors have no capability of managing those projects. Typically that's a strategic company and operator or even the government at the beginning because you have environmental licenses, you have expropriation, you have rights. So it's relatively complex and of course you have construction risk, you have all sorts of risks that we as financial investors cannot manage. So we typically invest in brownfields but relatively quickly a project of the two, three years becomes from green-field brownfield and that's where we invest and we keep it for 20, 30, 40 years. And there is a concept called asset recycling where you can actually bring in investors like us after the initial development phase so we stay for the long term and the people who have developed, the companies who have developed those assets actually get the new money and develop the next ones. And then have a higher return because it has to have a higher risk of course but that's a very nice concept on how you use different pools of capital for different phases of a project. And I think finally and that's something that is also very relevant in our Latin American markets which is a stable regulatory environment which doesn't always happen this way. So regulatory environment has to be known used. It's stable, it doesn't change, it is with independent regulatory agencies and just constant over time. So these are the three factors that there are easy said but difficult to implement and to act on. But this is the guiding light that we need to see in countries to actually develop and take off in a bigger fashion. And then to your initial question on the pipeline, you know there's different sources for this pipeline. It can be privatizations, it can be new concessions, it can be private to private. It can be asset sales by state owned companies like we're seeing now in some of those bigger corporates like Petrobras. So there's different sources and then of course there's the greenfields, there's new developments. You know without extending further, Chile is a country that has done very well in that area as well just to take one in Latin America. Just to give you an example how the private sector generates their own pipeline. In Chile you have a system that we have a toll road company there, Grupo Costanera. They have an in-house area that develops new projects for toll roads that go proposed to the government and the government is convinced they make a tender, an open tender, so our company might not win but if they don't win they get compensated for the development cost of that project. So there's an incentive for private parties to actually propose even though they might not win to propose new infrastructure projects. Thank you. Mariana, how do you see this question? How can a new project pipeline of high quality and resilient infrastructure be financed? Yes, I would definitely go to the sustainable part of it because we do believe that it needs to be upgraded, it needs to be retrofitted and yes it needs to be financed to get in that front. But our concern in the aviation industry is absolutely committed to the sustainable way that this is done. So we have been focusing on creating commitments within the industry and supporting both government and industry collaborators and peers in order to make those processes possible and bring the efficiency that we need to these processes. So if you look at the infrastructure for aviation is usually focused on obviously airports which is something that we could see but the huge piece of it is in air traffic and control management systems that we need to implement. So we were talking about how you got here and you were stuck in traffic but all of us as passengers also face that on a flight if you're out and up in the air and you can't land and you can see that the aircraft's going around and around it is because of infrastructure. That is the axis that is our unwilling and capacity to land and that has a huge impact in your lives because it delays your arrival time but also in the environment and the sustainable development that we all want to break to our infrastructure process. So by creating that efficiency we'll be able to actually have a cost effective, more cost effective airport. We'll be able to have a more energy efficient infrastructure and also greater wellbeing for everyone that it's using those infrastructures. So we're very focused on creating that sustainable development approach but also focus on how we are providing the better and most equitable services to the clients and the passengers and ourselves at the end of the day. Thanks. Just to come back, Georgina, you said that investors, these big financial investors are nervous about these markets. I can think of a few reasons myself why they might be but why are they, what are the principal reasons that make them nervous? So if you're well accustomed to investing in infrastructure across OECD markets and you have no resources to put out into emerging markets so you don't know how to assess the credit risk, you don't know how to target returns, you don't know how to assess, to consider asset allocation, it's much easier to stay in the markets that you're familiar in and you partner with someone like IFC who is very familiar with these markets that has people across all these markets that has boots on the ground that understands, can explain the risk to you and you can partner with them. We have our money at risk too so we are sharing, we look after their money as if it's their own and we bring them alongside us and demonstrate that whether you're investing in Mozambique or Mongolia or in Brazil, these are risks that we understand well and by demonstration we can show how we go about it and then hence bring in others behind and to some of the points that my colleagues on the panel were raising, stability is incredibly important and whether it's stability of the government or stability of the institution that you're investing with, knowing that we have been facing the challenges of unstable governments, of unstable regulation that does occur in some of these markets but that we have always been there and we said to our investors, look, you're going to give us 500 million, half a billion of your own money, let's imagine if you'd invested it with us five years ago or two years ago and we played out for them what kind of a portfolio they would have been invested in because the magic of the program that we have is you invest slithers of money in each of our projects so it's not that you put 200 million at risk in one project and 300 in another, you're putting maybe 50 in a slew of projects across an portfolio and you create a portfolio where, yes, one of these projects may have an issue or two is it does happen in infrastructure that things get delayed but if you have a portfolio of 80 projects in 30 countries your risk is obviously minimized, that portfolio approach and you follow an investor that knows these markets and you can then feel much more comfortable about taking that risk. One of my colleagues here talked about Greenfield or it may clearly it's much more, less scary to invest in a Brownfield project where the asset is already performing, we invest in Greenfield and to bring investors into Greenfield projects where clearly the risk is much higher as you're building out the project that's the area we are, is our strength and showing to institutional investors that understand this in other markets but are concerned about emerging markets and particularly with the sustainability, I mean we have performance standards that we stick to religiously, we look at the impact of the investment and that gives insurance companies large investors that have a reputation, comfort that their money is not going to be at risk and they're not going to be on the headlines of heaven forbid, the FT, you know, so people are comfortable working with, no, no, no, no. So that these are some of the concerns that investors can have and some of the ways that IFC can mitigate those concerns. Rudolph, what's your view on that? I mean is no Greenfield only in these markets or is that a worldwide policy? Yeah, maybe it's a little bit nuanced. So our companies or companies who invest in, they would invest of course in Greenfield because they have a portfolio of projects so if they have whatever five highways they would invest in one or two of our three highways new. What we don't do because we don't have the capability on the scale is to actually invest full-fledged in a pure Greenfield. At least not for now, maybe that evolves over time but for now our investment strategy is to actually focus on Brownfields and to focus exactly on that concept of asset recycling. So if someone develops a Greenfield and needs liquidity for the next Greenfield so we give these operators or corporates liquidity so they can actually sell the asset and go to develop the next Greenfield and we keep them the asset once it's become you know, brownish, less green. So in a way, de-risk. So it's nuanced. For instance, with Grupo Costa Red and Chile we constantly develop new highway projects but we have a portfolio project already with them so develop it in-house so it's part of their growth path. So maybe that's a little bit of a difference there between green and brown. Joey, I like green and brown, I like them both because this is all about opportunity, all right? And I believe to de-risk a bit the Greenfield approach I mean is that there's going to be an alliance between public and private partners. And I mean if we, for example, you know you go together with us and an off-taker so you've got all it takes to be successful there's someone who provides the money there's someone who provides the capabilities, the technology to make it work. He takes the operational risks, so to speak and then there's an off-taker typically the customer, if it's energy or if it's oil or gas or somebody else and they bring those three together and that's the best of all worlds which you can have because you have a capable strategic who knows how to execute. Either way, Brownfield as well as Greenfield you've got somebody, you know, bringing the money and there is a regulatory body who makes sure that the investment climate is somewhat comfortable and doesn't change every other year and there's a new government and that brings it back what I said earlier that's got to be a plan, an economic development plan which goes over life cycle. Not over period of when the next election is going to be it's got to be life cycle, life cycle of energy, life cycle of infrastructure or whatever we are going to invest into. So I actually do believe that in America, Brazil you mentioned Chile which is probably quite ahead of the crowd here, Argentina, I mean we'll see that surely is half in, half out and back to the next one job but we'll see how it develops and Brazil is in the beginning I believe of a new era. After years of stagnation, it could well now take off by such things with public-private partnership. I've met many, many people the last couple of days, private equity people, even state-owned companies who have a very, very clear approach of what needs to be done if they only let them to get the job done. So I have to say I'm very comfortable with the capabilities and the spirit and the power of this country. It is truly that there is a lack of vision, a lack of long-term plan which needs to be put in place and everything else I guarantee you people will come. We are here for 150 years and don't intend to leave and just yesterday I said we are going to invest another five billion in the next few years to help build infrastructure but it's also about small and medium enterprises to build them up, to bring small and medium enterprises to the country so that we have a broad-based economic development, not just a few Petrobras and Embraer and what have you and that needs to have a plan and I tell you everyone will come to invest. Sorry Joe, isn't the problem also though that what you do have these plans but then they keep changing, right? So like you mentioned, I think electricity, the electricity law or whatever has changed, changes every four years or something which is difficult for investors. The good thing is that our customers don't change every time and people don't change. You've got to have sustainable, reliable, affordable electrical power. It gets pretty dark at night if you don't and if you, how would anyone invest into automation? Everyone talks about the internet of things and it's all crap. I mean if you don't have electrical power and reliable logistics, just don't even think about that anyone invests into automation and internet of things if you can do a factory, run your factory in a meaningful way. So I mean you just need to face reality and our customers do face reality and we all do respect also on the economic power policy when Brazil has been having renewable energy when the whole world didn't even know about what this really is, which is hydro. And the good thing about hydro is it goes day and night because the water flows even if the wind doesn't blow and the sun doesn't shine. So they have quite a good starting point. We sure now is climate changes. Although some people believe it's been made up by the Chinese, it's real. And it also even now affects the water flow and the quantities and this very last year we needed to help the country here with a fast track power gen, four cell power gen because they didn't get the energy because the water wasn't there. So there is quite a good base to build and a good brownfield base to build on but then the returns and the attractiveness of investing comes with efficiency, what you say asset management. And so there is again, there is all it takes here we just need to bring people together and make it work and execute and not talk so much about what should have been done and could be done and wasn't done. And the bottlenecks that you're going to be clearing with this MOU, what are those? Well, I will tell, I believe, I said yesterday publicly I said, look, get your government done in October, November, it's time, I hope it doesn't take that long the German needed, but and then let's go sit together and do a B2G or maybe a G2G and come with a 20 gigawatt plan, come with a 5,000 kilometer of grid optimization plan, come with a 10,000 kilometers of roads and an urban mobility management. I mean, look at this great city, it's all great except the traffic, it's a disaster. I mean, a real disaster. And so things need to be done and they can be done. And it's not rocket science to put a few railcars on the ground and make traffic work and also then contain the root causes of inflation. I mean, you can raise interest rates till everyone is blue in the face. All you do is you kill your economy if the root cause of inflation is inefficient operations. If agriculture is inefficient and the goods and then the groceries doesn't make it to the customer, the consumer, there's inflation. And if 30% are rotting between the west of Brazil and Sao Paulo, it's got nothing to do with interest rates. It is about efficiency. So the challenges we've been seeing in this country is no rocket science to be solved. It's a convergent approach to get it done and there is, as I said, enough money, right? For looks, for investors. So I wanted to ask you where the money is coming from because I think it's very important to consider that the fund of money that the government may have and it has a responsibility to use that money as it sees to best serve its population and it's maybe easy from the outside to say these are the issues that need to be solved and here is the plan and get on with it but they have to rationalize the finance and it's, to over-indepth the government, I think, is a... I would not expect the government to finance everything and solve the problem of the private sector. Absolutely not. All I'm saying is there's got to be a framework of a life cycle so that the private sector finds it attractive to invest. I'd be happy to put a billion euro to work tomorrow. You know, if I had a roadmap to get it done and I'm sure I find another billion equity and any insurance company anywhere in the world and then there are a few, you leverage it up so you have a 10 billion thing to get started with but there's got to be an infrastructure in the framework which enables people to put their money to work. That's all we ask for. That's not about getting the job done on operations. It's just about set the framework and let the private sector do the job as it does everywhere in the world. Yeah, there is almost all of these sectors are profitable in themselves unless we go into some marginal solar energy that is still on the brink of becoming profitable but renewable energy, we just invested in wind-park farms, wind-parks, all airports... That's a good idea. Very good idea. So it's hugely profitable. There is enough capital. If we just take institutional investors' money and sovereign wealth funds, it's seven trillion of investments and you know, of course they are mostly government bonds but they are very open to equity and they're very open to long-term. We have a special one, we have a very long-term horizon. Our pension fund that is our limited partner in a way the only investor we have is still on a surplus so we are still getting money to invest and we have to reinvest our returns. So we're not looking for liquidity in many of our investments so we have this long-term horizon. So but it's not so much a matter of capital available, it's much more the availability of projects. You know, where you have this plan as you mentioned, you have the pipeline, you have a stable regulatory environment and then you have the mix of, put it in greenfield and brownfield so that you can actually feel comfortable to invest for the long-term. If you really look at economies which have been, accelerating and expelling, that common ground is they had a plan to develop their infrastructure of their country. They said we're gonna put 10 gigawatt to work over five years, right? And then they went into auctions. So how about just, you know, two of us go together and say five gigawatts in the northeast of Brazil, three cents per kilowatt hour, power out and then talk to the government and say, are you out? That's the type of stuff you put the potato on the fork, as you say. And so you need to be specific and clear and precise and not just try to save the world by talking. Isn't the problem here in Brazil though? I mean, Brazil has had plans. I mean, I almost forget the name of it now, the growth acceleration plan from Dilma. But then they change and then there's another problem which is the elephant in the room that's actually not here, which is BNDS, which for a long time is financing Brazil's infrastructure. You have a lack of long-term finance in Brazil, long-term finance options. Inflation's low at the moment, but it could be a cyclical load. It could come up and back up again. So how do you solve that sort of problem? I don't know. Rudolfo, perhaps it's your university here. Yeah, I think you know that BNDS has been in the past sort of, it's crowded out the private sector, but there is now the belief that BNDS should be more long-term financier by market rates. And if anything, not invest necessarily the big champions that can find alternative international debt markets, a couple of minutes anyway, but more the ones that are more the bottlenecks, that could be basic greenfield infrastructure, could be frontier technologies, could be small and medium-sized enterprises that aren't going long-term financing. So, but that's a different vision of what it could be very well-oriented on how Germany was reconstructed after the Second World War. There were some very good initiatives there. So, but I think that the long-term finance has to actually come from international investors. Absolutely. So that is institutional. The seven trillion doesn't even account for insurance companies, for what banks can put to work, what private equity firms can put to work. So this huge amount of capital that is the long-term. And still, you can develop the capital markets, infrastructure, the ventures is one example that has sort of slowly taken off, but it has potential as well. And then the government doesn't need, you need to put money or capital to work, just a little incentives on the tax side and that could be, that could be even enough to kickstart the process. You're taking some, you've got to be sure about the off-taking. So that's, I think that's important to close the loop, but there have been thousands of examples all over the world. And Latin America too, how that works, it's no rocket science. You also need to be assured of the strength of the local financial system. So Peru has been working on this for the last 15, 20 years of ensuring and setting up the legal system such that foreign investors are treated the same as local investors, that they have access to the same tax regime and that is enabled. I know there's 30 projects recently done in the transport sector because investors understood that they would be treated, the foreign investors felt that they would be treated exactly the same as the local investors. And it's important not only to have your plan and to have projects, but to have a legal system and a financial sector that is empowering to foreign investors. So we are back to having a plan, right? I think we need to move away from just having a plan and thinking about, because if having a plan was all that was needed to bring in institutional investors, I think we would have solved the problem by now. So it's also the regulatory regime of the institutional investors. So my experience is working with the French and the German investors and there the local regulations that the insurance companies have to manage under require investments such as the one I was describing to be investment grade. And most of the investments in the emerging markets are not investment grade. And so you have to bridge that gap. So there are other issues beyond. But doesn't the plan include on how you run your country in terms of the legal system provide comfort to investors that say, whatever you do here, you're legally saved as an international way of dealing with dispute. And that's what I mean is a plan. I don't talk about energy plan or infrastructure, but it's a plan how to develop your country. Above and beyond the four year cycle of election. And there are many examples to that. And all I can say, build that plan and they will come have always come. So on our sector and our industry, we actually have plans. And if you look at the IKO, the United Nations Organizations for Civil Aviation, we are looking at that infrastructure is a huge base of what we do because infrastructure will actually be the base for any development in technology and innovation. And we are a technology driven industry. So IKO has actually been advocating dramatically for PPPs, for the sector and bringing governments and then to share together in order to do that and obviously financial organizations that are gonna be able to give that support and provide the mechanisms. And in Brazil, if you look at the Brazilian scenario and reality, we are obviously a company that are producing regional aircraft and we are advocating for regional integration. But even within Brazil, if you look at the number of airports for the size of our economy, for the size of our demographics and even the distance between the regions, we need lots more airports. So the truth is that if you compare the Brazilian reality with others, even within the region, you see this, it's not a very good reality for the size that we have and the number of airports that we can provide. So there's great room. There's a huge need and the stakeholders in this sector are actually talking and advocating for it. But yes, the plan is there. We're still up to execute it. I just wonder if there's, I wanna come back to the environment as well, because that's a key thing in Brazil. Being the Guardian of the Amazon, the Matat Lanchika of these forests. But I just wonder if there's anyone in the audience because I know there's quite a few infrastructure experts here who wants to make a comment as Paolo here in front. It's just a question, Paolo Sotel from the Brazil Institute at the Wilson Center. We hear a lot of, we read a lot of news about Chinese investments in infrastructure in Brazil. I believe that they are mostly concentrated in the electric sector. What the Chinese don't know that you do or vice versa is I wanna, your expert opinion about the significance of this move by China that was before completely buying things here, but now they seem to have a more important presence in being old players in this space in Brazil. Help us understand what the Chinese are doing. So to my mind, it's about risk appetite. It's about risk appetite. So they come from an emerging market, they understand emerging markets and they have a risk appetite that is different to other investors and they are able to put large sums of money to work and they understand that the investments that they make here can make them a return that is commensurate with the risk because they understand the risk. And so that's, but they have a large, large amount. I mean, so the program that I was describing was actually begun by $3 billion investment that $3 billion allocation that PBOC, Public Bank of, People's Bank of China made to IFC and they did the same for Inter-American Development Bank and DBRD and others. They allocated $3 billion and we created our platform in order to enable them to learn from IFC but it was an enormous allocation. So they have a lot of money with which they can work and they have a risk appetite that is commensurate with how they see the risk. That would be my opinion, I don't know about mine. Well, there might be a buff and beyond financial capabilities understanding markets better. That could also be a strategic interest. Right? And I would actually put the investment of China into Brazil and Africa, more into the strategic category of a global view of things. And I mean, Brazil and Africa are developing economies, unlike Australia. So in order to avoid and there's debates with a developed economy like Australia. And now if you're China, you would rather go to areas where you can bring a lot of money and get your strategic interest in return. That's what you would do. The Chinese are very smart. They're very long-term oriented. They don't talk so much. And if they do the thing first, and then act and therefore plan. And that plan is not by the quarter. A plan is not by the year, not by the decade. That plan is about a long view of things. If you talk to Chinese companies and leaders, they say, look, in the last 200 years has just been a minor deterioration of long-term development, which we need to correct. And if you try to think about this a little bit, I think we understand why they've been trying to invest so much into agriculture, into natural resources. They don't invest into other things. Those are the two areas where they do. And that's actually not that big of a risk because government to government is about strategic interest. So we need to, especially financial investors, need to have a more short-term view about returns than they have. And that's why I, and the strategists like us are somewhat in the middle. And that's why I believe we better also think about this together with those countries where strategic investors invest into because at some point in time, we may not want to be caught flat-footed with a single option. If I may just compliment us, I think we have just different type of Chinese investors, of course. There's the strategic, like you've seen in Brazil with Southern Grid, the St. George's. We have seen in Chile, we have seen in China, Southern Grid, so it's great here in Southern Grid in Chile. But there's also the institutional investors in China that have been investing abroad. And there, I would say, are more like-minded, like international institutional investors that are also long-term. And I think what we still need to learn how to work is with Chinese SOEs because they're strategic, they are long-term, as was said here. But we don't think, even for us, we don't think we know yet how to team up well with them. And we're learning that even as long-term investors how to work together because it's a new reality. And you might say, well, if a CPFL is sold to a Chinese, it's just a Chinese company. But sometimes we share control, like in the case of the Chilean company now where we have invested. And it's a learning process for us as well as institutional investors to learn how to work with them. And I would concur, very patient, very, very industrious in laboratories in terms of learning the industry and not being too quick to come to conclusions or to jump to conclusions and take decisions. So it's a long-term learning process that they're doing. And I would even say it might have a financial interest, but it looks like, at least, that most of that is really long-term strategic interest rather than just financial results. Just on our side, Paula, the, actually, if you look at China, there are great opportunities to my previous point as well. So there is a huge opportunity there to grow. And China is actually investing both in infrastructure with the characteristics that my previous colleagues just mentioned. So they're focused on the long-term. This is an industry that works with the huge cycles. So you're talking about 15, 20-year cycles. And, but also in the production and industrialization process, they're also investing in, and they have the means, and they have the plan, and they're entering the market. So we are, we're looking at that carefully. Thanks, Susan. You have a comment you'd like to make over here in the front. And you've talked quite a lot about the different. So I should have asked you to introduce yourself. Susan Gray from S&P Global. You've talked a lot about the institutional, financial, regulatory frameworks that are important. Could you please just comment on governance and how you are looking to set the governance standards of counterparties that you're dealing with and how you're looking to, if you like, improve those governance and transparency standards over time, please. So from the IFC perspective, that's very core to the way that we invest. We have standards for the environment, social aspects and the governance of any project that we look at. And, but it's always a journey. As long as you are, you know when you look someone in the eye and you're working with them that they understand what you are trying to achieve, whether they're there on day one or they're going to be there in a year's time, you can work with them to implement the best standards in corporate governance. And certainly from the IFC perspective as an international development institution, it's integral to what we do and the projects have the highest standards. But we recognize that they are not necessarily in place the moment we invest, but they will be within a short time. We bring those standards to our investing companies. Yeah, for us, it's key, I think, in that same sense, is you know, it's compliance, it's one of foremost, it's almost a gating item. That's not negotiable, governance you negotiate, but I think there is some compliance aspects in this environment that is not negotiable. It's either there or not. You can of course evolve, but it has, it's a core due diligence aspect of any investments that is even short, medium or long term that we actually are comfortable with how compliance is managed, how transparency is done. It goes as long as far as business culture values, et cetera. So that has to be in place. It can of course be developed and adjusted. I think compliance in Brazil is not that old concept. So the last years have brought that to every boardroom, to every executive suite. There is a lots of advisors now advising on compliance. So it has, but there is a big, big openness to improve that and to develop that. But the core values have to be in place. I think then you can formalize it and in terms of compliance. And on governance side, it's key as well. So I think the governments, the independence of boards, the qualification of boards. So there's a whole set of criteria that we apply in our investments. And I think that's part of our value addition as well to our investments, is to bring this institutionalization to invested companies. I just wondered, is it hard to attract money to Brazil? Given Lava Jartu and just about every construction company of a certain size, seem to have had something to do with that. So how do you convince people to invest here now? You know, we are constantly working internally to explain what is happening in Brazil and to see the medium and long term. And actually my, our view is not just mine, is that Brazil has improved. You know, if you think five or 10 years ago, it was looking good at the surface and it was totally rotten inside. Maybe I'm exaggerating to make the point. Now I think we just seen how rotten it was and it's being addressed. So the patient in a way, we're taking out the cancer and it's taking time. We'll take time for the patient to cure as well, but at least we're addressing. We're seeing, we're seeing, I don't know if we're seeing the whole problem, but we're seeing part of the problem and we're addressing it as a country. What is core through institutions. So not through a central Politburo or some central decision-makers, institutions, independent institutions, working to improve the process. And that's the most important thing. So you know, you could make good investments 10 years ago, but you were not really clear what was behind that. I think it's much clearer now, there's more transparency, there's more consciousness on what's really happening in this company. So that trend, of course, is just a start. It's a long journey, it's not just for Brazil. It's Latin America as a whole and I'm not qualified enough to talk other emerging market, but certainly there as well. So but certainly for Brazil, this is a journey that has started and it started in the right direction. You might be under this, just on the compliance still. There's a lot of talk about environmental licenses being really hard in Brazil, but also that it sometimes doesn't seem very effective because you still get the environmental damage that comes from projects. So what can be done about that? Yeah, I think that, you know, the compliance matter is something that it's here to stay. So we're just gonna have to deal with that and I think it's a good thing for every company, for every government, for every industry. And we as an industry that do have a lot of commitment to this have actually been advocating under the World Economic Forum that regard. When it goes to the environment, we are an industry that are focused on the environment. We're really committed. We actually have a formal commitment to reducing climate change. So we don't do this on a Brazil basis or an Embraer base is not a company one. It's a global effort because the whole point that we're trying to make as an industry is that we can't have this individual. We can't have systems to take place individually or regionally even. We are a global industry with global impact and capacity so we need global process to be implemented in the environmental and sustainable development site even in infrastructure. So for instance, when you talk about the commitment, the formal commitment that we have to reduce climate change, you're talking about an industry that said that by 2050 it's gonna reduce 50% of its CO2 emissions with the baseline of 2005. How are you gonna do that? You're gonna do that through a four pillar strategy and that is technology, which is for us as an OEM, it's the highest investments that we make because we're talking about billions of dollars that are being deployed to build a new aircraft. But if you go forward to the other stakeholders of the industry, you get into logistics and then you get into infrastructure and you get into the market-based measure which is a different thing that entangles an offsetting carbon trade program to actually achieve those goals. But infrastructure has to be the core and all of this involves the environmental and the governance and eventually that all the compliance matters. I think we've got a couple of more questions just here in the middle. If you could introduce yourself. Hi, Flavia Cardoso with American Tower. I was wondering if the panel could comment a little bit on the telecom, information, communications, infrastructure, state of, and reviews and how to bridge some of the gaps there. It's not very informative. So you want to know it? No. Would you like to comment? I would actually comment, but we actually have a project to, with the Brazilian government, Embraer and Telebras' partner to build a satellite and we were on the path of launching it formally, but it's already started. We had the first launch in the French Ghana last year and it's not my scope of activity, but it's a project within the defense organization and it's with that purpose. It has a civilian purpose, it's a strategic project for the Brazilian government, obviously, for Embraer and it's under Viziana, which is one of our subsidiaries. Maybe I will comment a little bit just since you asked. It should be part of the plan, I guess it's part of the comment. There is a significant under-investment. If you look at, relatively speaking, all these infrastructures will depend on communication, telecommunications, all the technologies that will connect things and bring efficiencies, productivities, et cetera. I think there's a gap in the vision and typically it's not discussed enough. It's left to some companies and significantly taxed, but not part of this more over-encompassing plan of the long-term vision. Absolutely agree with you, I mean, infrastructure is also about connectivity and all that great stuff with the internet of things and force industrial pollution and all that stuff. Not gonna work if you don't have connectivity. 4G, it looks good here, but maybe it doesn't look that great if you leave the suburban environment and there's no autonomous driving without connectivity. There's no autonomous driving in Sao Paulo anyway, because you're in traffic. It better be autonomous flying, I have to tell you. Traffic change, traffic change all the time, but absolutely agree with you, connectivity matters a lot, but otherwise there's no progress on exchanging information and optimise things. And you just signed a digital alliance as well, seeming signed a digital alliance with ICC? Of course we have, because we can contribute a lot on that one and the way we do it is not talk so much about how great software and cyberspace is, the way we look at it is that we connect the physical world with the virtual world. That's what many people forget at times if they talk about next generation of manufacturing and engineering, the next generation of industrialisation. Many people, some people try to make us believe there is no physical world anymore, there is no hardware, there is no molecules, it's all cyber. Thanks God, the facts of the matter is there is physical world, there is woods and plastic and chocolate and cars and carpets and clothes and what have you. Hopefully also humans. So connecting the physical world with the capabilities of simulation and analytics and bring that knowledge which we generate up there in the virtual world back into the physical process. That's the recipe. And make the physical world more efficient, resource efficient, faster by connecting the data, understand what they mean and bring them back into the physical processes of whatever that is, flying aircraft or connecting people or anything of that. And that's what I think we figured out over time and that's been the recipe why we actually almost every quarter when we report our numbers in the digital factory, the gap actually increases between us and the next in line. And we work really hard to continue that way, it's not that simple as it looks like and it's by no means arrogant because it's really hard to convince the customers also to let the data flow and bring them back into the physical world. But yeah we did that and we also said we would do is we actually bring that automation to universities to students, learn those young people on how what that actually is all about. And that learning the physical world is not out of fashion. It actually becomes more in fashion as we speak because the physical world will be better world supported by and enabled by the virtual world and not the other way around. And that's, we need to talk to young people about train them in a man machine interfaces in what automation is all about and not that dirty work and oily greasy stuff anymore. You know you work with your brain and your hands together. And so that's very important to us and that's why we said we invest a lot also into education and training those young people and get them off the street and show them a way and future and make them buy into it that this is something which is good for them because if you don't get the society to buy into the next generation of industrialization there will be a revolution that's gonna be on the street with burning cars and not self-driving cars. Because digitalization splits society and the last thing you want to split it even further as we have split it already. So we need to integrate it. And so that comes back to infrastructure and societal responsibility more than any other talk about how great we are in connectivity and cyberspace. People don't understand that. If people don't understand what they're talking about they are scared and they don't believe you. And they don't want to change anything because they say well I mean today's safe at least not as could be worse. And that's what we need to overcome also as a societal barrier. And then we can make it work. Technology is not the hold up. The acceptance of society going forward and giving people a perspective that's what we have at stake and that's what we need to do together also as part of a plan of a government of society economic and political and societal leaders like science and universities. I think that's what we really have at stake here. Thanks very much. We had a couple of questions here but I think we've run out of time so I apologize for that. But just to sum up quickly Georgina told us about your program to bring in these big institutional investors into emerging markets and create confidence. I think Joe you spoke a lot about the need for a plan. You're fine. Economic development plan. Economic development plan consists of. The rest will take care of. The rest will sort of follow. Iridolfo that one of my takeaways from what you said is that these plans they need to endure across governments and I think the regulatory regimes somehow you have to convince every new government that comes in to respect what's there and not change it too much. And Mariano I think you spoke a lot about what the airline industry is doing as well to try to make infrastructure more sustainable. So because I'd like to thank you very much. Can I just say one last thing because I didn't realize this. So before there was a plan IFC our very first investment ever was in Brazil in a project in Siemens 61 years ago. So we did it together then.