Brazil: Economic Mirage or Jewel in the New Global Economy?

Brazil: Economic Mirage or Jewel in the New Global Economy?

Eugene Allevato (Woodbury University, USA) and Joan Marques (Woodbury University, USA)
DOI: 10.4018/978-1-4666-6224-7.ch004


Brazil is globally known for many reasons, varying from its sizzling Copacabana beach to its immense Maracana stadium. It is revered as the birthplace of world-famous soccer players such as Pele, Garrincha, Tostao, Socrates, and Ronaldo, and envied for its eye-popping carnival suits and mesmerizing samba dancers, but there is much more to this country. When considered from a business perspective, Brazil surfaces as one of the four most promising global economies, along with the other BRIC nations of Russia, India, and China, but how much of this vibrant economic picture is true? Having gained independence in the 19th century, there is much to be said about Brazil's current internal economic climate and social system. This chapter takes a less-traveled road in its review of Brazil. By examining this nation from the inside out, a less frequently presented, vulnerable image of this gigantic country is presented. Brazil's relationships with multinationals and with trading partners are reviewed against the backdrop of its lacking growth in national standard of living and its poor primary education system. Brazil is reviewed as the home of impressive industries, its ongoing technological dependency on other nations, and its performance as a supplier of natural resources to many industrial powers.
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The Inconvenient Truth Of The Brazilian Independence

It must be noted that Brazilian colonization was fundamentally different from the North American colonization in that settlers occupied North America with the purpose of adopting to a new country; however, in Brazil the purpose was to exploit quickly while maintaining roots in Europe. In addition, North American settlements were characterized by establishment of families in the New World, while settlement in Brazil was predominantly conducted by Portuguese males. The fact that families did not settle in Brazil the same way as they did in the United States indicates there was no interest in building a Brazilian community for future generations. Rather, the Portuguese settlers merely perceived Brazil as a rapid path to wealth. Due to this dominating mindset of exploitation among the Portuguese colonizers, Brazil’s history marks a more expanded and enduring degree of slave traffic from Africa than does North America.

Key Terms in this Chapter

Dutch Disease: An economy that increasingly rely on the exploitation of natural resources and decline of the industrial sector.

Intermediate Power: A country in transition from under-developed to advanced economy.

Deindustrialization: A process of dismantling the industrial sector due to economic pressures of cheaper products coming from outside sources.

Resources Power: A country that has plenty of natural resources and provides these resources to other countries.

Social Gap: Typical social scenario of under-developing countries caused by economic inequality.

Political Corruption: Politicians and major corporate illegal actions to provide for their own economic benefit and interests.

Resources Exploitation: Brazilian natural resources being utilized by other countries with little or no economic benefit to the general population.

Economic Miracle: A period of extraordinary economic growth in Brazil. A term that was coined during the military government, but that could be easily applied today. In both cases, the driver of the economic growth is due to natural resources exploitation of countries that are fomenting their manufacturing sector, currently mostly dominated by China.

Colonial Stigma: Social, economic and cultural dependence by an outside dominant culture.

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