Brazil’s Economy

A Strong Leader in the South American Economy

Read this article in Portuguese here

Brazil and the United States have the two largest populations and economies in the Western Hemisphere. The two countries have an ongoing relationship dating all the way back to 1824, when the United States was the first country to recognize Brazil’s independence. At the beginning of the twenty-first century, the relationship between Brazil and the U.S. is increasingly an economic one, with the United States being Brazil’s largest individual trading partner.

Brazilian culture is complex and varied, contrary to existing stereotypes. To many outside the country, it is the land of soccer, samba, bossa-nova and the Amazon. While these are culturally important aspects of life in Brazil, others exist which are neglected by the American press, including business. Few Americans realize that Brazil is currently the eighth largest economy in the world, and that during the 1990s the opening up of its economy resulted in markedly increased imports.

Despite a history of economic problems, Brazil is a potentially rich country with a strong industrial sector, large agricultural production, and rich natural resources. Today, Brazilian industry accounts for 20% of the country’s national production, while agriculture and the services sector hold the remaining 20% and 60%, respectively. Like America, the majority of the Brazilian population is concentrated within urban areas, particularly in major cities, which play an increasingly active role in the country’s economy.

With its one hundred and sixty million inhabitants and strong ties to the United States, Brazil is poised to increase its leadership role in the South American market. Today, more than two thousand US companies operate in Brazil and Brazilians purchase 18% of US exports. From the list of the five hundred largest multinationals published in Fortune magazine, four hundred and five have a Brazilian subsidiary. Brazil’s current and potential economic growth indicates that the country will continue to have an increasingly substantial impact on the world economy.