Brazil

Further settlement and economic development of the Northwest is currently one of the high priorities of the Brazilian government. A special program, POLONOROESTE, has... Show More + been established to help bring order to the large, spontaneous migratory flow to the Northwest and, consequently, at increasing the productivity, incomes, and social welfare of the region's present and future population. The major components of the program include: (i) road reconstruction and improvement, particularly in the areas of greatest agricultural potential; (ii) consolidation of existing settlement projects and establishment of new ones, improvements in physical and social infrastructure and services, and measures to protect the natural environment and interests of the indigenous population; and (iii) establishment of a number of urban support centers in the more remote rural areas. The program entails substantial risks emanating from the region's size and frontier status, its rapidly-growing population, its confused land tenure situation, its fragile and imperfectly known natural environment, its Amerindian population, and its thin administrative structure. The government must be prepared to accept some of the negative effects frequently associated with accelerated development in frontier areas. Show Less -

The capital goods producing industries have played an important role in the growth of Brazil's industrial sector since the earliest stages of its modern development.... Show More + But at the beginning of 1979, these industries were faced with a situation of considerable excess capacity. Further expansion of exports was needed and appeared possible. Financial facilities needed expanding as well, so that more export credit might be made available. In addition, efforts were required to stimulate specialization and avoid dispersion of production both at the product and plant levels. A policy framework encouraging a more open economy was considered desirable. The prevailing system of import protection needed major revision, focusing on exchange rate overvaluation, tariffs on capital goods, prior import deposits, export subsidies, and fiscal subsidies for production. Show Less -

This special report on Brazil focuses on population dynamics and on the development of human resources or, from a somewhat different point of view, the provision of... Show More + basic services in the broader context of development. Its aim is to facilitate the search for effective policies and efficient programs. The specific objectives are: (i) to assess the historical evolution of various socioeconomic indicators; (ii) to relate the evolution of these indicators to a broader historical framework of population and development; (iii) to analyze available data and estimate the quantitative relations between variables pertaining to population dynamics; human resource development; and labor markets, income distribution, and basic macroeconomic variables; and (iv) to articulate these quantitative relations in simple simulation models and to analyze costs and outcomes of selected policy interventions. The report concludes that the benefits of rapid economic growth have not been distributed evenly and that meeting the basic needs of the entire population is a political rather than economic issue. Show Less -

This special report on Brazil focuses on population dynamics and on the development of human resources or, from a somewhat different point of view, the provision of... Show More + basic services in the broader context of development. Its aim is to facilitate the search for effective policies and efficient programs. The specific objectives are: (i) to assess the historical evolution of various socioeconomic indicators; (ii) to relate the evolution of these indicators to a broader historical framework of population and development; (iii) to analyze available data and estimate the quantitative relations between variables pertaining to population dynamics; human resource development; and labor markets, income distribution, and basic macroeconomic variables; and (iv) to articulate these quantitative relations in simple simulation models and to analyze costs and outcomes of selected policy interventions. The report concludes that the benefits of rapid economic growth have not been distributed evenly and that meeting the basic needs of the entire population is a political rather than economic issue. Show Less -

Since the beginning of 1974 the Brazilian economy has been dominated by the problems of adjustment to the changed conditions of the international economy. The major... Show More + dilemma has been to seek a viable compromise between balance-of-payments and growth objectives. Since mid-1976, a gradual but steady tightening of monetary policies has slowed the growth of money and credit slightly. However, recently the rapid growth of credit extended to the private sector and the large inflow of funds on external account have led to a rapid expansion of the monetary base. This has been difficult to control. The statistical basis for making any statement about overall levels or trends in poverty and inequality in Brazil, is lacking, but indications are that distribution is skewed and poverty widespread. For the growth rate to reaccelerate, manufacturing exports must continue their rapid expansion while import substitution must continue its already impressive pace. The underlying dynamism of the Brazilian economy is such that a suitable adjustment could be carried out without causing undue hardship. In addition, long run capital requirements now appear to present much less of a potential problem than they once seemed to. Show Less -

The Central-West Region of Brazil contains one of the world's last great agricultural frontiers. The major constraint on agricultural development appears to be soil... Show More + quality, which can be alleviated through modern technology. Also, the wide spectrum of settlement patterns in the region, which results in highly unequal distribution of land and rural incomes, raises complex issues for policy formulation. The major question is how to manage the process of frontier settlement to achieve a balance between efficiency and equity considerations. Although agricultural development in this area could play a major role in alleviating rural poverty by accommodating migration from poor areas of the country, the Government has tended toward maximization of the rate at which new lands are brought into cultivation, a strategy that largely overlooks the smaller producers. Although frontier agricultural development will involve various settlement approaches, the critical tasks are to design policy instruments and an institutional framework to promote land use patterns that yield the greatest social and economic benefits. Show Less -

After the very rapid growth in the period 1967-74, when GDP growth in real terms averaged 10 percent per year, and per capita incomes registered a gain of sixty percent,... Show More + the growth of the Brazilian economy decelerated considerably in 1975. Severe balance of payments difficulties experienced in 1974 were compounded by a combination of adverse climatic conditions and policy-induced factors in 1975. In spite of this, actual export performance was quite impressive. Intensification of the balance of payments pressure through 1975 brought growing realization that drastic and effective domestic policies were needed to prevent further deterioration in the overall economy even at the cost of growth. Stabilization of the external payments position finally became accepted as a principal short-term objective. While growth and balance of payments prospects for the medium- and long-term hinge on the success of short-term stabilization measures and maintenance of high rates of export growth, the general outlook is favorable. The current account deficit will require substantial external financing, but sound economic management should produce a significant decline in the debt service ratio. Show Less -

This economic memorandum examines how Brazil has been affected by recent changes in the world economy, describes how the authorities have adjusted policies to cope with... Show More + these changes, reviews the near term outlook, and finally discusses the longer term prospects for the Brazilian economy. Measures to cope with the new external situation began in March 1974, and efforts are being made to reduce the current account deficit of the balance of pyaments to more manageable levels. In recent years, Brazil has become more closely integrated into the world economy, and its growth has become more dependent upon and vulnerable to changes in the world economic situation. There has been a remarkable broadening and deepening of the country's productive base and of its infrastructure as well as a considerable strengthening of its external sector. nevertheless, unequal distribution of income and extensive absolute poverty remain serious problems. To alleviate this, government is focusing on regional development, provision of social services, and wage policy. Show Less -

Increased flows of iron ore, steel products, and agricultural products in Brazil will require drastic improvement of the transport sector. Upgrading of the existing... Show More + Belo Horizonte-Rio de Janeiro railline, construction of a new line - Belo Horizonte-Volta Redonda, and provision of an efficient rail transport outlet to USIMINAS should remove current transport bottlenecks. Recently completed port expansion works. The increase in petroleum prices in the last year has led the government to review its transport investment policies. The 1975-79 Plan includes: (i) progressive diversion of heavy long distance transport flows from road to rail and water transport, and railway electrification; (ii) emphasis on suburban rail and bus transport; (iii) adoption of a realistic pricing policy of petroleum derivatives with no subsidy; and (iv) implementation of measures to save fuel. In coming years the country should address the need to adjust capacity to meet demand, sound planning of capital investments, improved maintenance, efficiency of operations and better knowledge of costs to improve pricing policy. Show Less -

Despite an impressive growth rate over the past three years, Brazil remains a poor country with a very unequal income distribution and extensive absolute poverty. The... Show More + government is convinced that the poverty and dualism that afflict the country can be ameliorated only if high rates of growth are sustained, although external factors may necessitate transition to a slower growth rate. Urbanization and industrialization have placed a particularly heavy strain on social and economic infrastructure in Sao Paulo. Investment strategy 1973-75 aims to decentralize economic activity, and programs have been designed to broaden distribution of the benefits of economic growth, particularly in education, housing, and sanitary services. Regional development programs are heavily oriented toward transport infrastructure and provision of credit to commercial agriculture and agroindustry. Rapid regional growth should continue, but unless high levels of investment are sustained, population pressure will outstrip gains. Volume III discusses Sao Paulo in detail. Show Less -