This paper provides an overview about Brazil, its economy and recent developments. The following chapter gives an introduction into general information and backgrounds that will serve as foundation for the following chapters. Chapter 3 provides insight into economic policies and show how far politics are intertwined with the economy. This is followed by a short macroeconomic overview and the development of the GDP and inflation over the last years after which the most important economic sectors will be introduced. An insight into international economic relations of Brazil regarding major trade partners as well as commodities will be given in chapter 6. All of this will finally be completed by a conclusion and outlook on potential developments and possible changes in the future.
Brazil has lately been very present in the media and demanded worldwide attention due to hosting main sport events like the FIFA World Cup in 2014 and Olympic Games in 2016. Along with that the media focused not only on the events themselves but also the host country and its condition. It is a common phenomenon that also events that are not related to the sport events gain more attention and are internationally observed closer. That was when I noticed that I hadn’t known much about Brazil, its politics or economy. By following news and also writing this paper I found out that there, of course, is much more about Brazil than Carnival in Rio and a national soccer team Germany beat 7:1.
While working on the paper a relevant political event happened: after the President Dilma Rousseff was impeached earlier this year she was officially replaced by her Vice President Michel Temer on 31 August 2016. This I took as a frame for my country paper and focused on recent events and changes that might come with this change of power.
Table of Contents
1. Introduction
1.1 Motivation
1.2 Structure of Paper
2. Country Background
2.1 General Information and current events
2.2 Social Issues: Poverty and Education
3. Economic Policy
3.1 Development policy approach
3.2 Participation of government in economy
3.3 Fiscal Policy
3.4 Monetary Policy
4. Current Macroeconomic Situation
4.1 GDP growth
4.2 Inflation
4.3 Unemployment
5. Economic Structure
5.1 Agricultural sector
5.2 Industry sector
5.3 Service sector
5.4 Areas/Branches of high importance/competitiveness
6. International Economic Relations
6.1 Foreign trade broken down by major regions/countries
6.2 Foreign trade broken down by commodities
6.3 Foreign direct investments
6.4 Labor exports
6.5 Participation in customs unions/free trade areas
6.6 Foreign exchange policy
7. Major Problems and Potentials of Economy
7.1 Opportunities
7.2 Threats
7.3 Conclusion
Research Objectives and Key Topics
This paper aims to provide a comprehensive overview of the Brazilian economy, focusing on the country's recent political transition and macroeconomic challenges. It examines the structural development of the nation's key sectors, international economic positioning, and the potential impact of ongoing reforms under the post-impeachment administration.
- Political impact of the change in government and fiscal strategy.
- Macroeconomic analysis regarding GDP growth, inflation, and unemployment.
- Evaluation of key economic sectors including agriculture, industry, and services.
- Assessment of international economic relations, foreign trade, and FDI flows.
- Identification of structural opportunities and threats within the Brazilian economy.
Excerpt from the Book
2.1 General Information and current events
The República Federativa do Brasil (Federative Republic of Brazil) is the largest country of the South American continent both by geographical size and population. With 8.5 million square kilometers it makes 47% of South America and because of that borders on almost every South American country: Argentina, Bolivia, Colombia, French Guiana, Guyana, Paraguay, Peru, Suriname, Uruguay and Venezuela except for Chile and Ecuador. To the east Brazil has a 700 kilometer broad coast to the Atlantic Ocean. The climate is tropical to subtropical.
Brazil is inhabited by an estimated 209.6 million people with a yearly growth of around 1% in population over the last 6 years. This makes Brazil the sixth largest country of the world by population. However, the population density is only 25.1 people per square kilometer. It concentrates especially at the coastal area in the east and south east where big cities like Sao Paolo, Brasília and Rio de Janeiro are located. With an urbanization ratio of 86% Brazil lies above the world average of 54% and also above the average of Latin America (80%). 450,000 people live in Brazil’s capital city Brasília. Most of the population is Christian with a majority of Roman Catholics (around 68%), followed by Protestants and a variety of Christian and spiritual groups. The official language is Brazilian Portuguese.
Since 31 August 2016 Brazil has a new president: Michel Temer. In May 2016 the Senate of Brazil started an impeachment trial of Dilma Rousseff who was reelected as president in October 2014. From then on Vice President Temer took over the office and officially became president when the Senate declared Rousseff guilty. 37 charges have been brought in, among them “crime of fiscal responsibility” and budgetary embellishment. Rousseff herself denies all accuses and states herself as victim of a coup.
Chapter Summary
1. Introduction: The introduction outlines the author’s motivation for selecting Brazil as a subject, driven by its recent global exposure and political shifts, and provides a structural overview of the report.
2. Country Background: This chapter provides essential geographical and demographic data, while also summarizing the recent impeachment of Dilma Rousseff and the subsequent transition to the Michel Temer presidency.
3. Economic Policy: The chapter explores Brazil's shift toward austerity measures and privatization as a response to the ongoing economic recession and political instability.
4. Current Macroeconomic Situation: This section details the country's struggle with stagflation, declining GDP growth, and rising unemployment rates, highlighting the dependency on global commodity prices.
5. Economic Structure: The author analyzes the agricultural, industrial, and service sectors, noting the resilience of agribusiness contrasted with the stagnation in industrial and service-oriented domains.
6. International Economic Relations: An examination of Brazil’s trade dynamics, foreign direct investment flows, and the importance of trade blocs like MERCOSUR in the country's foreign trade strategy.
7. Major Problems and Potentials of Economy: The final chapter weighs the opportunities of the domestic market and privatization against the threats posed by political corruption and government interference in economic affairs.
Keywords
Brazil, Economy, Macroeconomics, Fiscal Policy, Monetary Policy, GDP Growth, Inflation, Unemployment, Agriculture, Trade, MERCOSUR, FDI, Privatization, Political Crisis, Austerity
Frequently Asked Questions
What is the core focus of this paper?
The paper provides a comprehensive country analysis of Brazil, specifically examining its economic performance, structural challenges, and the political transition occurring in 2016.
What are the primary themes discussed?
The core themes include the impact of political instability on economic policy, the recent recession, sectoral breakdown of the economy, and international trade relationships.
What is the research goal of this paper?
The goal is to analyze the current state of the Brazilian economy, particularly how a change in executive power and new fiscal strategies might steer the nation toward stabilization and growth.
Which scientific method does the author employ?
The paper uses an analytical and descriptive approach, drawing upon macroeconomic data, institutional reports, and contemporary news coverage to assess the country's economic status.
What topics are covered in the main body?
The main body covers country background, government economic policies, current macroeconomic trends (GDP, inflation, unemployment), sector analysis, international relations, and an evaluation of economic prospects.
Which keywords characterize this paper?
Key terms include Brazil, macroeconomics, fiscal and monetary policy, recession, sectoral analysis, and international trade.
How has the recent change in government influenced the economy according to the text?
The text notes that the new government under President Temer has introduced austerity measures, public sector job cuts, and privatization plans to address the budget deficit and restore investor confidence.
Why does the author consider Brazil an attractive, yet challenging, market?
It is considered attractive due to its vast domestic market and resource wealth, but challenging because of stagnant growth, high inflation, and persistent corruption scandals that create political tension.
- Quote paper
- Lisa Piroth (Author), 2016, Brazil. Order and Progress?, Munich, GRIN Verlag, https://www.grin.com/document/471283
