Brazil’s development

Given my own view that freer trade is necessary to promote peace and prosperity between competing nations, Brazil provides an important national policy example to Australia (and the world) in social and environmental terms.

After all, Brazil (with its population of more than 190 million) is now the world’s tenth largest economic country in nominal terms (9th in purchasing power parity terms), and represents the fifth largest area with many of the world’s most important forests and ecosystems.

In many aspects, Brazil has done well in recent years. Brazil received an IMF rescue package of $US30 billion in mid-2002, after adopting a floating currency in January 1999, which was repaid by 2005.

Brazil has benefited from a global boom in commodity prices (particularly from beef and soybeans), logging, fishing, and the manufacturing of automobiles, steel, petrochemicals, computers, and even aircraft. Unemployment was 8 per cent in 2008.

In agricultural terms, Brazil is a rival to Australia, despite greater potential being offered by a growing world population and rising incomes in China and India alone. In 2004, though Brazil had its problems associated with foot and mouth disease, it was noted that Brazil’s beef production costs were 15 per cent lower than Australia. There was concern that South Asian markets could open further to Brazil at the expense of Australia and New Zealand.

And in September 2008, the Rabobank Group noted that Brazil was set to challenge New Zealand, the European Union and Australia as the major exporters of dairy products.

Already, the World Trade Organization (WTO) indicates that Brazil has increased its share of world agricultural exports from 2.8 to 4.3 per cent between 2000 and 2007 while Australia’s share declined from 3 to 2 per cent. By 2009, Brazil was the world’s largest exporter of beef, coffee, sugar, soy and grain and the world’s second biggest exporter of poultry and pork.

With funding for basic research coming mostly from government sources, Brazil has also developed major technological centres and the most advanced space program in Latin America.

Better economic times also led Brazil to develop a four-year plan from 2007 to spend US$300 billion to modernise roads, power plants and ports.

And after its experience with military governments (1964-1985) which allowed 1 per cent of the population to control 95 per cent of the wealth, Brazil’s democratic governments have achieved important social goals. The percentage of Brazilians living on less than one dollar a day has declined from 9.5 to 4.2 per cent between 1992 and 2005. Malnutrition in children under five years fell from 13 to 7 per cent between 1996 and 2006. And Brazil’s literacy rate reached 88 per cent of the population by 2003 with the youth literacy rate (ages 15-19) being 93.2 per cent.

Brazil’s Ministry of Health has also provided condoms while giving HIV-AIDS patients free antiretroviral drugs which are either manufactured as low-cost as generics, produced and sold without patent, or purchased at a lower price from foreign pharmaceutical companies.

But Brazil provides a national example that indicates to nations like Australia that it is determined to improve its economic well-being with minimal regard for the concerns of Westerners, whether social or environmental.