Brazil Economic Conditions
General framework Only in recent decades, and in forms not yet completed, has the Brazilian economy been freeing itself from its colonial origins. In the past, it has always been based on the exploitation of single products, concentrating in real economic ‘cycles’ on specific sectors: from precious woods (16th century) to sugar cane (17th century), to breeding bovine and pork (18th century), with gold and diamonds (19th century), with coffee and rubber (20th century); especially coffee, in a phase of expansion of the immigration population and of the economic importance of the B, had such an impact as to condition the life of the town. After the Second World War, but still in more or less accentuated phases, the tendency has prevailed both to exploit the entire range of possible resources, and to take advantage of the vast potential market constituted by the population of Brazil (eighth country in the world for number of residents, ninth by wealth produced), encouraging basic industrialization and consumer goods. In spite of the lack of organically efficient planning guidelines, the country has undoubtedly recorded remarkable progress, even if the distinction between the south-eastern coastal regions and the rest of the territory is still drastic.
It should also be emphasized that Brazil is one of the states in which the income gap between the richest and the poorest population is greater and that, consequently, the real internal market is much less consistent than it might appear: 20% poorer than the population, it has around 2% of GDP at its disposal; the richest 20% about 64% (2005 data); 31% of the total population is below the poverty line. Under these conditions it is clear that the figure for the average annual GDP per resident, which also recorded a significant increase in the early 2000s, reaching approximately $ 9,500 in purchasing power parity in 2007, has an exclusively theoretical value. The same structure of the active population (with still 21% of employed in the primary sector in 2005, but almost 60% in the tertiary sector) denounces a development process that is relatively distant from that of the more advanced countries. The limits of industrialization, which allowed the fort, are evident economic growth in the 1960s and 1970s, but only in the Southeast regions, traditionally more populous, more dynamic, more open to trade and richer; moreover, from the point of view of ownership, a very large presence of foreign capital (about 1/3 US) characterizes the basic sectors.
Since the beginning of the 21st century, however, the growth rates of the economic system have always been quite high, despite a series of internal and external financial difficulties; inflation was reduced to acceptable levels, also thanks to a radical monetary reform in the 1990s; exports have started to increase both in quantity and in value; increasing integration with MERCOSUR members, after a start that had penalized Brazil compared to other countries, and the growing trade with the European Union began to dramatically promote some Brazilian production sectors. Among the most serious problems remain the incidence of foreign debt, on which the Brazilian governments have engaged in tight negotiations with international creditors, while some positive results are beginning to be obtained internally, acting on the fiscal lever and public spending, and realizing encouraging primary budget surpluses; and then internal inequalities, generated by distributive inequities of various kinds, starting with access to ownership of arable land as well as social services.
Agriculture and livestock Until a few decades ago, the country’s economic features were almost entirely dictated by the production of few mineral and forestry raw materials and above all by the commercial cultivation of a wide range of agricultural products. These continue to have great importance, of course, especially in some regions, and especially if we consider the impact in terms of cultivated area: the agricultural landscapes of vast Brazilian regions are still marked by soy plantations, of which the country is the second largest producer. worldwide, thanks to the nearly 23 million hectares cultivated; corn, of which it is the third largest producer and fourth exporter (11.5 million ha); of sugar cane (leading producer, 5.8 million ha, mainly in the NE); of coffee (first producer and first exporter, 2.3 million ha, especially in the Southeast and in the Sul); and cotton, citrus fruits (first producer), acajú nuts, cocoa, other tropical fruits. It is interesting to note that the historical stratification of monoculture specializations, experienced by Brazil over the centuries, has ended up differentiating plantation productions, so that as a whole the agricultural sector appears much less vulnerable than in the past to fluctuations in international prices; there was proof of this with the collapse of the price of coffee in the 1980s following the entry into the market of strong African producers, which did not cause the economic cataclysm that occurred at the beginning of the 20th century. for a similar situation. To the productions destined above all for export, are added those directed mainly to internal consumption, for which the Brazil however still imports agricultural commodities:
Breeding is also of great importance, especially cattle: Brazil is the second largest producer in the world of cattle and buffaloes, largely concentrated in southern Brazil and destined for the production of meat and hides rather than milk; but the breeding of pigs (third producer) and poultry (fourth producer) is also very important; the meats are exported widely, after being treated by freezing, salting or canning. Food self-sufficiency is not fully achieved, due to the modest productivity of large estates in the NE and the impact of plantations on the best lands in the southern regions; but it is no longer even sought after, given the growing inclusion of Brazil in the world market as an industrial country.
Agriculture is thriving as a whole, but the problems that the sector poses are above all structural (land ownership, mechanization, extension of arable land) and have no easy solutions. The territory intended for crops does not reach 8%; a little more than 22% is covered by pastures, almost two thirds of the total by woods and forests; the crops expanded to the detriment of the forest areas have almost always been scarcely productive; on the other hand, the cultivation of new lands in the Amazon region only marginally solves the problem (more social than economic in the strict sense) of sem terra, laborers and very small peasants who in recent decades have tried, through an organization capable of persistent political pressure, to obtain reforms that would allocate a portion of the large estates to redistribution; the greater presence of large estates (pasture or extensive cereal growing) and, together, of landless peasants is recorded in the central-southern and eastern regions of the country, where moreover the soils are often already at the limit of productivity and would not support intensive agriculture such as what the poor peasants would need.