Sam Zell: Brazil Will be ‘Bigger than China’

Real estate billionaire Sam Zell says Brazil is a great long-term investment choice — better even than China, a favorite of investment powerhouses like Jim Rogers and Mark Mobius.

Zell’s surprising answer came in response to a moderator's question on what single investment panelists would make in real estate.

"I'd buy Brazil,” said Zell, who is chairman of Equity Group Investments. "It has the chance 30 years from now of being a bigger economic power than China.”

The extremely successful real estate and (somewhat less successful) media investor was speaking at junk bond king Michael Milken’s annual Milken Institute Global Conference.

Story Continues Below

Brazil is largely self-sufficient, according to Zell. The country benefits from a highly trained work force and arable land supporting production of a variety of crops.

Brazil is also rich in natural resources.

The national oil company, Petrobras, recently announced it might have made one of the world's biggest oil finds. Initial reports suggested the discovery would easily drive Brazil into the realms of the world's top oil exporters.

Brazil's economy has grown for five consecutive years. Gross domestic product rose 5.4 percent in 2007, the fastest rate in three years, led by a surge in investments by companies in new machinery and by consumer demand.

Zell likes the prospects of retailers in the rapidly growing economy of 180 million. And he has put his money where his mouth is, developing the nation’s largest mall.

Zell said Brazil's biggest mall operator was seeing retail sales growth of 10 percent annually.

He also praised Brazil's head of state, President Luiz Inacio Lula da Silva, who has presided over uninterrupted economic growth since taking office in January 2003.

"He's a leftist and we like him,” Zell said.

Providing more insight into his thinking on China, Zell said China's one-child policy, would hurt the country in the long run because it ends up reducing the number of workers.

"I think by 2020 that will come back to bite them big time,” said the blunt-talking billionaire.

Editor's note:
Which Stocks Should You Dump Immediately
Investors now urged to avoid the Euro. Find out why.
Why the Dollar May Have Hit Bottom. New Actions to Take Now.
Capture 10% to 15% Dividend Income Every Month
How to Make Healthy Profits in Sick Economy.
Four Reasons to Own This Medical Devices ETF
Aging World Sets Stage For Healthy Profits
Money Pouring Into Medical Devices Sector. Best ETF to Own Now.