Case #2 Brazil: Leading the BRICs?
Professor ROBERT A COSCARELLO
Chen Wang ( Cherry )
As of the date of the case and as explained in the case: is Brazil leading the BRICs? Please explain and defend your position. (We will discuss more recent data in class if time.)
From the case I can see that for the past decade, Brazil has experienced greater integration into the global economy which has been characterized by significant growth in economy and reinforcement of the country's weight in international trade negotiations. Brazil played an increasingly important leading role in the BRICs. However, Brazil was the underperformer of the BRICs in many areas. It faced significant obstacles to growth, including rising inflation, high interest rates, an appreciating exchange rate, poor infrastructure, excessive bureaucracy, and persistent crime. Overall, I think that Brazil plays a more and more important role on the international stage but is not leading the BRICs.
Brazil plays a more and more important role on the international stage
Strong economic growth
Brazil had sustained an average annual GDP growth of 4% since 2000. Between 2002 and 2009, inequality and poverty had declined significantly and more than 30 million Brazilians had advanced from lower income strata to the middle class.
Goldman Sachs expected the BRICs to be among the five largest economies in the world by 2030, forecasting a growth rate of more than 5% per year for Brazil.
Intensive international trade and foreign investment
By 2008, Brazil was in the top 20 countries ranked by international trade.
After Brazil joined the WTO, over time, the number of Brazilian firms on a list...