Brazil

Over the past decade, credit markets in Brazil have markedly deepened. Credit as a share of Gross Domestic Product (GDP) almost doubled-from 28 percent of GDP in 2000... Show More + to 49 percent in December 2011, bank spreads almost halved, and access to credit has increased sharply for almost all market segments. This report reviews the performance of Brazilian credit markets over the past decade, which saw macro stabilization and microeconomic reforms with marked effects on credit market outcomes. The report tries to distill the impact of those structural reforms and identify the remaining structural challenges. To address these issues, the report focuses on three main enduring paradoxes of Brazilian credit markets. First, how has the transmission of monetary policy to loan prices and volumes improved over the decade? Second, why have Brazil's interest rate spreads remained so high despite macro stabilization and micro reforms? Third, why did access to credit for consumers expand so much while firms' access did not? Brazil's resilience to the 2008 global financial crisis and so far to the unfolding Euro zone crisis demonstrates that the country's credits markets have come a long way over the past decade; however, much remain to be done to increase resilience, lower prices, enhance competition, and expand access across the board for consumers and firms. This report hopes to provide some insights on those challenges. Show Less -

Urban sources of greenhouse gas (GHG) emissions in Brazilian cities are growing. At the national level, the dominance of greenhouse gas emissions from deforestation... Show More + in Brazil masks the fact that emissions from other sectors, like Energy, Transport and Waste, are growing quite rapidly in cities. Compared to other cities around the world, Brazilian cities have low per capita GHG emissions because of the high level of renewable energy production; but as Brazilian cities continue to grow, the pressure towards higher emissions will persist. The majority of emissions from Energy in Brazil result from the use of fossil fuels and electric power by industry. Industrial processes using fossil fuels will continue to be the largest contributor to emissions growth over the long-term, but electricity generation will produce the highest emissions increase in the period up to 2030. For the past three decades, the trend has been for industries to move away from city centers to peripheral locations that are cheaper and have easier access to distribution networks. However, all the GHG emissions inventories completed to date by Brazilian cities are limited to municipal boundaries, making it difficult to assess the role of industrial emissions at the metropolitan level. One clear trend within city boundaries is that residential consumption of electricity is increasing. As households become wealthier, the size of housing units tend to get larger and the number of domestic appliances increase and residential consumption of electricity is expected to grow drastically in the next two decades.Transport emissions are rapidly growing, especially in urban areas. Fossil fuel–based emissions in Brazil are low compared to other countries due to the prominence of renewable-energy sources for electricity and fuels. In fact, ethanol substitutes for two-fifths of gasoline fuel. However, transport-sector emissions are rapidly growing due to increased motorization and congestion. This is coupled with a tendency for smaller agglomerations to grow in a sprawling manner, which is directly impacting the growth of GHG emissions, since the amount of vehicle travel is linked to urban form, i.e. the location of housing, jobs, commerce and entertainment.
A distinguishing characteristic of Brazilian cities is the high percentage of emissions from waste. The waste sector constitutes about 4 percent of GHG emissions on average in cities.1 A key driver of waste emissions is the amount of waste produced and collected. In Brazil the amount of waste collected has increased by about 4 percent per year since 1970. The amount of solid waste collected in urban areas is expected to continue increasing in the next two decades due to increased generation of waste and improvements in the collection system. This will likely result in an even higher share of GHG emissions for the overall sector.
Climate change impacts are widespread. Climate impacts from global warming in major Brazilian cities have been identified and include flooding from intense storms, increased temperatures, and droughts. Sea level rise is also identified as a concern for Brazil because 25 percent of Brazil‘s population lives in coastal cities. Brazilian cities are taking action against climate change. In response to concerns about global climate change, Brazilian cities have been world leaders in defining GHG emissions reduction targets and adopted local climate change laws. Some cities have completed GHG inventories, established reduction targets, and taken measures to mitigate emissions. Show Less -

The worldwide carbon market is a reality. It has contributed to the implementation of projects that aim to reduce Greenhouse Gas (GHG) emissions in many different s... Show More + ectors and it has turned GHGs, represented by carbon, into economic assets that are no longer mere environmental liabilities. In this context, Brazil currently ranks third in the world in terms of the number of projects on the Clean Development Mechanism (CDM). Brazil pioneered the development of the first large scale methodology and registration for the first project in the history of the CDM. Despite Brazil's significant qualitative and quantitative participation in such projects, there is still great potential for the development of other types of CDM project activities. Given the new methodologies for CDM projects approved over the last few years and the programmatic CDM, which intends to reduce bureaucracy and accelerate the registration process for closely related projects, there exists an even greater potential for CDM projects in several sectors in Brazil. The main objective of this study was to identify the existing technical potential for low carbon projects as described above as well as to stimulate the implementation of low carbon projects in Brazil, thus contributing towards reducing and avoiding Brazil's current and projected emissions and inserting Brazil into the new low carbon economy. Generally speaking, the study focused on sectors where there is still a potential for the application of conventional techniques or technologies to reduce or avoid GHG emissions. Show Less -

This report is designed to provide policymakers with estimates of the likely outcomes of an array of potential changes in transportation sector policy. To this end,... Show More + the report uses a variety of economy-wide models to simulate alternative cost reductions and efficiency improvements. A detailed discussion of the various policies that may yield efficiency gains and cost reductions, as well as the specifics of their implementation, is beyond the scope of the report. The report is structured to move from a general description of Brazil's transportation sector to more specific analyses and simulations of individual and concerted changes. The first chapter sets the stage by providing a summary discussion of Brazil's transportation sector that includes both an overview of its historical development and a look at the recent evolution of government policies. In the second chapter, the fiscal and economic effects of shifts in public investment between alternative and competing transportation modes (roads, railroads, and waterways) are simulated using a fixed-price input-output model. The report's third chapter uses a computable general equilibrium (CGE) model to analyze the effects of cost reductions in land transportation on macroeconomic variables and income distribution. The fourth chapter uses a multiregional CGE model to simulate the effects of port efficiency improvements on regional economic development (including short- and long-term growth, employment, and welfare). The fifth chapter uses a similar model to analyze the national and state-level impacts of two federal highway projects in the state of Minas Gerais in terms of economic growth, regional inequalities, employment, and poverty. The last chapter summarizes the findings and provides conclusions and recommendations. Show Less -

This document is part of a series of reports by the World Bank on Brazil's potential to foment more robust economic growth and reduce poverty and inequality. The main... Show More + focus of this report is on the interrelated fiscal circumstances facing Brazil, with an emphasis on public sector spending. The report is divided into two volumes. This first volume distills the essential stylized facts (that are described in detail in volume two) and focuses on key recommendations (discussed in detail in Chapter 5 of the second volume). These recommendations highlight not only areas where improvements could be achieved, but also suggest options on how to go about implementing such modifications, based in part on international experience. The second volume of the report contains: more detail on these stylized facts; a first attempt to compile data for the entire non-financial public sector; quantitative analysis of the fiscal impacts on growth using a dynamic general equilibrium model and a simulation based on that model; specific examples of key budget rigidities; and, as an example, a review of road transport spending with a view to strengthening the impacts of this infrastructure spending. Other related World Bank reports concentrate on social security, health, financial markets, infrastructure, poverty, and the issues surrounding the monitoring and evaluation of public sector services in general. Volume one of this report also reflects some of the preliminary findings in these other reports. Show Less -

This report was prepared in response to the request from the Government of Brazil to evaluate the experiencia de Avaliacao do Plano Plurianual (PPA's) evaluation system... Show More + and propose ways it could be strengthened. In our understanding, the genesis of the PPA as an instrument of government planning and management and its philosophy was circa 1999. It was then that the decision was made to apply a particular planning model piloted with a set of priority projects (Brazil em Acao) in the 1996-99 PPA to the entire set of government activities in the PPA 2000-03. The current state of the PPA reflects a series of evolutionary changes since then, with the improvements in its evaluation framework being one of them. Because of this origin, understanding and evaluating the PPA evaluation system will require placing it in the context of the evolution and the effectiveness of the whole PPA, as envisioned in its original model and its subsequent adaptations. The point of departure is the observation that the primary challenge is to make the PPA effective as an instrument to make the federal administration more performance oriented. Improvements to the evaluation system as such, though welcome and needed, should be a secondary objective for the government, as this is only a limited part of the whole endeavor. Show Less -

This report examines the implications of spatial heterogeneity - the uneven distribution of poverty, growth, and environmental assets - for policy. Its goal is to inform... Show More + a wide set of policies that are either explicitly spatially targeted or may have unanticipated spatial implications. These include poverty alleviation policies targeted on poor municipios; demand-driven poverty alleviation policies; territorial development policies aimed at stimulating growth in a multi-municipio region; growth policies targeted on semi-arid regions; policies to protect environmental assets. The report focuses on clarifying some of the fundamental assumptions and underpinnings of spatially oriented development policies, addressing six questions organized in three sections. Are policies targeted at poor municipios effective in reaching poor people? Do demand-driven policies favor poor people? What explains divergent labor market experiences in rural areas? Are poverty and economic stagnation in the Northeast closely tied to agroclimatic conditions? Is poverty a major determinant of Amazonian deforestation? Is there a steep trade-off between forest protection and agricultural output? The report advances knowledge in each of these areas, but unresolved issues remain for debate and research. Show Less -

During the last century, Brazil was one of the fastest growing economies in the world. Between 1901 and 2000, Brazil's Gross Domestic Product (GDP) per capita grew at... Show More + an average annual rate of 4.4 percent. Brazil's long-run growth has rivaled that of counties such as South Korea, universally praised as a stellar performer. Brazil does not received the same praise. Perhaps one reason is that more has been expected of Brazil, especially by Brazilians themselves. After all the country is richly endowed with natural resources and is blessed with an energetic people. Perhaps is that economic growth in Brazil has been more erratic than in other countries, or it may be that this economic growth performance has been accompanied by high inequality, thus diminishing the "quality" of growth. How is it that the country with the fastest growth in the region also has the highest inequality? Are the two facts related, and if so, what can be done to improve the pattern of future income growth across the social classes, and reduce its extreme inequality and the breadth and depth of its poverty? The first volume summarizes the overall conclusions for policy drawn from the seven background papers presented in the second volume, and other relevant research, as well as giving a historical account of the driving forces behind Brazilian growth since the 1960s. Show Less -

This report finalized in March 2001 constitutes a step toward the objective of designing an integrated strategy for rural poverty reduction in Brazil, The report contains... Show More + an updated and more detailed profile of the rural poor in the northeast (NE) and southeast (SE) of Brazil; identifies key determinants of rural poverty in these regions; and proposes a five-pronged strategic framework in which to couch a set of integrated policies that could effectively help to reduce rural poverty in Brazil. This tentative set of policy options was identified via an analysis of rural poverty determinants complemented with an evaluation of relevant current public programs and six in-depth thematic studies that bear on critical components of the proposed integrated policy approach aimed at reducing rural poverty in the NE and SE of Brazil: 1) the dynamics of the Brazilian small farm sector, 2) rural labor markets, 3) rural land markets, 4) rural non-farm employment, 5) rural education, and 6) rural pensions. While this study emphasizes primarily microeconomic events--such as the impact of schooling, income transfers, and access to land and credit--poverty reduction requires both economic growth (macro-level) and specific anti-poverty policies (micro-level). Show Less -

The study consists of two volumes, the first volume contains a detailed summary of the report findings, and policy implications, and, the second volume, the Policy Report,... Show More + contains discussions on policy recommendations for each of the components of the Brazilian social security system. An overview on the dimensions of the social security challenge, reviews the system components, revealing unsustainable fiscal imbalances, and administrative weaknesses in both the unreformed General Regime for Social Security (RGPS), and the Pension Regime for Government Workers (RJU), with large tax-related distortions, and labor market inefficiency. Thus the goals of Brazil's reforms are to reduce fiscal deficits, lower actuarial imbalances, increase equity and redistribution, reduce collateral inefficiencies, and facilitate growth of funded pensions. The study implies there is no recourse for the country, but to lower the high, uniform replacement rates (experience suggests that rates higher than 40-70 percent, cannot be sustained) and, spells out that the key to effective reform of social security, is widening the debate to include potential winners from these changes, particularly the private sector, the young, and the poor. Policy recommendations suggest, that the adverse equity effects of RGPS reforms, should be widely publicized to generate political support for deeper RJU reform. Show Less -