Scientists in Brazil kick off groundbreaking Covid-19 research

. Jul 13, 2020
Scientists in Brazil kick off groundbreaking Covid-19 research Sirius synchrotron. Photo: CNPEM

This newsletter is for PREMIUM and STANDARD subscribers only. Become one now!

We’re covering this week one of the boldest projects against the coronavirus by Brazilian scientists. The spree of IPOs — despite the crisis. And the workers most affected by job cuts.

Brazilian scientists make progress against coronavirus

The Brazilian Center for Research in Energy and Materials (CNPEM) will open its doors

today to host research projects related to the coronavirus. Located in the southeastern city of Campinas, the center is home to Sirius, the BRL 1.8-billion particle accelerator which is Brazil’s biggest and most complex scientific structure to date.</p> <p><strong>State-of-the-art science. </strong>Sirius is, more specifically, a synchrotron, a particular kind of accelerator which moves particles around a fixed, closed-loop pattern. In addition to providing a great source of energy, synchrotrons can have various scientific and industrial applications. Inaugurated in November 2018, the facility is still in the commissioning stage — which imposes some limitations on researchers.</p> <ul><li>Still, CNPEM decided to go ahead and launch studies in response to the pandemic. The center announced over the weekend that it had completed its first experiment: creating 3D images of essential Sars-CoV-2 proteins.</li></ul> <blockquote class="twitter-tweet tw-align-center"><p lang="en" dir="ltr">The Brazilian Center for Research in Energy and Materials announced over the weekend that it had completed its first experiment: creating 3D images of essential Sars-CoV-2 proteins. <a href="https://t.co/hIxXcmmBxD">pic.twitter.com/hIxXcmmBxD</a></p>&mdash; Gustavo Ribeiro (@gnribeiro) <a href="https://twitter.com/gnribeiro/status/1282636166018355201?ref_src=twsrc%5Etfw">July 13, 2020</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script> <p><strong>Why it matters.</strong> The pictures could help scientists understand how the virus works inside human cells and could be pivotal to support research for drugs against Sars-CoV-2.</p> <p><strong>How the scientists did it. </strong>Using a beamline dedicated to macromolecular crystallography, scientists analyzed the 3CL protein, which is crucial for the virus&#8217; development.&#8221;When we can inhibit these proteins, we can interfere in the replication process,&#8221; says Daniela Trivella, research coordinator of the center&#8217;s Covid-19 task force.</p> <ul><li>According to the researchers, the first anti-HIV drugs were also developed from a deeper knowledge of the virus&#8217; essential proteins.</li></ul> <p><strong>Funding.</strong> Sirius is a rare example of a long-term scientific project in Brazil. It could be an island of state-of-the-art science in a country where funding for research has become so scarce. Some scientists are funding research themselves, as the government is turning down most projects, claiming a lack of money.</p> <div class="flourish-embed flourish-chart" data-src="visualisation/3162868" data-url="https://flo.uri.sh/visualisation/3162868/embed"><script src="https://public.flourish.studio/resources/embed.js"></script></div> <hr class="wp-block-separator"/> <h2>Stock market set for IPOverdose</h2> <p>Despite the challenging economic scenario caused by the coronavirus crisis, Brazil may witness one of the biggest sprees of companies going public this year. So far, initial and follow-on offerings have amassed BRL 40 billion (USD 7.5 billion) in 2020 — already the third-highest in the decade. And the number is set to grow, with environmental solutions provider Ambipar holding its IPO today on the São Paulo stock exchange, pricing its offer on the top of the range and raising BRL 1.08 billion.</p> <div class="flourish-embed flourish-chart" data-src="visualisation/3160349" data-url="https://flo.uri.sh/visualisation/3160349/embed"><script src="https://public.flourish.studio/resources/embed.js"></script></div> <p><strong>More to come.</strong> Two more offerings are expected to be priced in July:</p> <ul><li><strong>Soma.</strong> The group owns several fashion brands, including luxury ones such as Animale and Farm. With 221 stores in Brazil and two in the U.S., the group posted net profits of BRL 126.8 million. The IPO could raise up to BRL 1.5 billion —&nbsp;which shall be used to pay for debts and dividends, acquisitions, new stores, and tech investments.</li><li><strong>Riva 9.</strong> The company focuses on building homes for medium-income families and could raise up to BRL 1.1 billion with its listing, scheduled for July 30. Riva 9 aims at spending one-third of that money on buying land from its parent company, Direcional, while the rest shall fund new projects.</li></ul> <p><strong>Also in line.</strong> Brazil&#8217;s Securities Commission&#8217;s website shows at least 20 IPO requests in progress. But, according to some estimates, up to 50 companies are getting ready to go public or post follow-on offerings.</p> <p><strong>Momentum.</strong> With benchmark interest rates at their lowest ever, demand for variable income assets is soaring. Plus, companies have been resorting to capital markets to beef up their cash reserves and weather the crisis.</p> <p><strong>Atypical.</strong> Previous years of crisis (2009, 2015, and 2016) didn&#8217;t see the same activity. What sets 2020 apart? According to Pablo Spyer, director at Mirae Asset, “200,000 new investors are joining the [domestic] stock exchange every month,” he wrote. “There is no doubt that there is demand for new stocks.”</p> <p><em>— with Natália Scalzaretto</em></p> <hr class="wp-block-separator"/> <h3>Markets</h3> <p>Latam Brazil was included in its parent company&#8217;s Chapter 11 bankruptcy protection filing in the U.S. last week. Meanwhile, analysts are optimistic about its main competitor, Gol. Investment bank BTG Pactual raised Gol&#8217;s target share price from BRL 20 to 27, with a &#8220;buy&#8221; rating —&nbsp;saying the airline will benefit from low exposure to international markets, strong liquidity, and a better fleet downsizing program. BB Investimentos adds that Gol should gobble up much of Latam&#8217;s market share in the near future.</p> <p class="has-text-align-center"><em><strong>Natália Scalzaretto</strong></em></p> <hr class="wp-block-separator"/> <h2>Which jobs are closing?</h2> <p>In 2018 and 2019, most formal jobs were low-paying ones, of up to BRL 2,000 (USD 375.66) per month. In 2020, however, these jobs were the first to disappear. Over 75 percent of the 1.1 million formal positions that have been closed this year were in this salary range. The retail sector lost the most jobs, being an area that was severely affected by the pandemic.</p> <div class="flourish-embed flourish-chart" data-src="visualisation/3160822" data-url="https://flo.uri.sh/visualisation/3160822/embed"><script src="https://public.flourish.studio/resources/embed.js"></script></div> <hr class="wp-block-separator"/> <h2>Looking ahead</h2> <ul><li><strong>U.S. v. China.</strong> The Chinese and American ambassadors to Brazil exchanged harsh words over the weekend. On Friday, the U.S.&#8217;s Todd Chapman <a href="https://twitter.com/USAmbBR/status/1281731180904058881">posted on Twitter</a>: &#8220;Mass <a href="https://www.businessinsider.com/china-forcibly-sterilizing-uighur-women-xinjiang-abortions-contraception-ap-2020-6">sterilization of Uighur women</a> by the Chinese Communist Party —&nbsp;silence is not an option.&#8221; On the following day, the U.S. Embassy in Brasília took <a href="https://twitter.com/EmbaixadaEUA/status/1281991461337214978">another jab</a>: &#8220;FBI director: &#8216;China pays scientists in U.S. universities to secretly take our knowledge and innovation back to China&nbsp;—&nbsp;including valuable, federally financed research.&#8217; Is that happening in Brazil?&#8221; China&#8217;s Yang Wanming <a href="https://twitter.com/WanmingYang/status/1282164184747319296">replied</a>: &#8220;An ant is trying to knock down a giant tree, ridiculously overestimating its own capacity.&#8221;&nbsp;</li><li><strong>EU.</strong> Foreign ministers from European Union member nations meet today, and among the many items on the agenda is the bloc&#8217;s strained relationship with Latin America. They will discuss how the EU has provided support to the region. However, <a href="https://brazilian.report/newsletters/brazil-daily/2019/09/19/austria-veto-eu-trade-agreement-mercosur/">intense trade disputes</a> and growing skepticism with Latin American leaders, especially Brazil&#8217;s Jair Bolsonaro, continue to prevent rapprochement.</li><li><strong>GDP.</strong> On Tuesday, the Central Bank publishes its Economic Activity Index for May. The numbers are <a href="https://brazilian.report/newsletters/brazil-daily/2020/07/09/trust-brazil-post-reopening-recovery-amazon/">expected to be positive</a>, reflecting an improvement in the country&#8217;s industrial results and retail performance.</li><li><strong>Tax reform.</strong> House Speaker Rodrigo Maia and Senate President Davi Alcolumbre have given the government its last chance to submit its tax reform proposal. If the Economy Ministry doesn&#8217;t send its bill by the end of the month, Congress will disregard its input and go ahead with designing its own proposal to overhaul the <a href="https://brazilian.report/podcast/2019/05/01/tax-system-brazil-complex/">country&#8217;s super-complicated tax system</a>.</li><li><strong>Labor.</strong> The Senate is expected to vote on the provisional decree altering labor rules during the pandemic as a move to avoid layoffs —&nbsp;regulating comp time, remote work, bringing forward holidays, and collective vacations. The matter has already passed in the House and must be approved by the Senate before July 19 —&nbsp;otherwise it will expire. On another front, Congress is expected to strike down a presidential veto barring payroll bonuses until the end of 2021.</li></ul> <hr class="wp-block-separator"/> <h2>In case you missed it</h2> <ul><li><strong>Coronavirus 1.</strong> After months belittling the severity of the coronavirus, President Jair Bolsonaro announced he had <a href="https://brazilian.report/podcast/2020/07/08/explaining-brazil-podcast-bolsonaro-is-one-in-a-1-6-million/">contracted Covid-19</a> last week, and has tried to use his diagnosis politically — doubling down on every talking point he has used since the beginning of the pandemic. He once again promoted controversial antimalarial drug chloroquine — stating he is taking it regularly to positive effect — and said social isolation measures are useless, as most Brazilians will get the virus anyway. Political scientists believe the <a href="https://brazilian.report/power/2020/07/07/bolsonaro-wont-be-able-to-make-lemonade-of-covid-19-diagnosis/">strategy won&#8217;t work</a>.</li><li><strong>Coronavirus 2.</strong> Meanwhile, Brazil has recorded over 1.86 million infections and 72,100 deaths from Covid-19. The real tallies, however, are likely to be much higher, as Brazil has struggled with data reporting problems and low levels of testing. In ten states, <a href="https://brazilian.report/coronavirus-brazil-live-blog/2020/07/11/once-again-brazil-confirms-over-1000-deaths-in-one-day/">death numbers are on an upward trend</a> —&nbsp;which hasn&#8217;t stopped governors from continuing to reopen non-essential activities.</li><li><strong>Environment.</strong> VP Hamilton Mourão met with the major international investment funds that threatened to pull their money from Brazil unless the government actively starts curbing deforestation. On the same day of the meeting, official data showed that June had a record-setting number of deforestation alerts. Over the first half of the year, there was a 25-percent increase in destroyed forest area when compared to 2019. But if deforestation is going up, sanctions by authorities are down 60 percent under Jair Bolsonaro. Experts warn of an &#8216;environmental blackout.&#8217;</li><li><strong>Education.</strong> After three weeks and two botched nominations, President Jair Bolsonaro finally picked a new Education Minister: presbyterian preacher Milton Ribeiro. The choice was highly controversial, even though Mr. Ribeiro has previously served as vice-rector at the prestigious Mackenzie University in São Paulo. That&#8217;s because he has already defended inflicting physical punishment on children, and said universities teach students to engage in &#8220;limitless sexual practices.&#8221;

Our content is protected by copyright. Want to republish The Brazilian Report? Email us at contact@brazilian.report