Brazil: South America’s star

Concordia’s faculty of Political Science hosted a conference Sept. 11 bringing students news of the Brazilian economy’s boom-
phenomenon.
The event’s main speaker, Salvador Sandoval, a professor of Political Psychology and Social Movements at Catholic Pontifical University of Sao Paulo, says the country is becoming the rising star of Latin America. According to Sandoval, Brazil’s economy keeps growing, its social programs are exemplary, and the country is even being considered as a candidate for the United Nations Security Council.
This seemingly fast ascent has baffled some people, who did not expect Brazil to emerge as an economic leader in Latin America.
“For a long time, Brazil was under everybody’s radar. Nevertheless, during this time, Brazil was taking key strategic steps to ensure our growth,” said Sandoval.
One of these key steps is forcing transnational corporations who open businesses in Brazil to produce 100 per cent Brazilian products. This means they must use Brazilian products in the production process. Examples of companies that became ‘Brazilian’ in compliance with the country’s regulations are the IBM Corporation and the Ford Motor Co.
“Usually Brazil gives a company time to slowly adapt and become ‘Brazilian’, but they have deadlines. If they do not achieve the switch by then, they have to start paying fines, and these fines are hefty,” said Sandoval. Unlike other Latin American countries such as Mexico, Brazil does not intend to encourage the creation of assembly plants.
“The maquila (assembly plants) by their nature do not allow real growth in the living conditions of those who work in them; if their salaries increase the plants will leave. We are not interested in them,” stated Sandoval.
Brazil also refuses to sign any free trade agreement, unless a member clause is included, meaning that only products made in the participating states would be free of tariffs.
“Brazil does not want to see its markets inundated with products from China and whatnot. If we sign a free trade agreement with the U.S., this free trade should only include items made in the signatory countries, and this is not convenient for them,” said Sandoval.
In addition, Brazil has refused to sign a free trade agreement with states that have agricultural subsidies.
“We do not subsidize our farmers; we cannot expose them to an unfair trade with highly subsidized farmers,” explained Sandoval.
“Clearly Brazil has followed a program that has made it emerge as a leader in Latin America,” said Concordia political science professor Jean Mayer. “The Brazil phenomenon is impressive. They have not followed any specific model. They are just creating their own as they go but it seems to be working,” said Mayer.
According to Mayer, one of the key features of the Brazilian model lies in Brazil’s refusal to privatize key industries.
“The whole world has gone crazy with this neo-liberal model, believing that these industries will be better if they are privatized. This is a myth and Brazil hasn’t fallen for it.”
The 2006 Gertulio Vargas Foundation Survey calculated Brazil’s poverty rate at 22.7 per cent, compared to 26.1 per cent in 2003.
This is the country’s lowest poverty level in 25 years.