Data for 2013 and 2014 are forecast. GAP per capita are in constant 2012 prices FACTS Area Currency Real (BRB = 100 centavos) Location Brazil, the largest country in South America, occupies some two-thirds of the continent’s entire Atlantic coast. It is bordered by Argentina, Bolivia, Colombia, French Guiana, Guyana, Paraguay, Peru, Surname, Uruguay and Venezuela. Much of the country’s Page 1 of 9 climate is tropical but in the south it is temperate. Capital Brasilia GOVERNMENT Head of State Dilemma Van Rousseau (2010) Head of Government Ruling Party The government is formed by the Workers Party (POT) and its allies.
Political Structure Brazil has an executive president elected by popular mandate for a term of four years. She is answerable to a bicameral National Congress. The Chamber of Deputies has 513 members, elected for a four-year term by proportional representation. The Federal Senate has 81 members, elected by plurality vote for eight-year terms, with elections every four years for alternately one-third and two-thirds of the seats. Last Elections A general election was held in October 2010. In the election for the presidency, Rousseau defeated JossГ© Sera in a round run-off with 56% of the vote.
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In congressional elections held at the same time, a total of 22 parties were able to elect at least one representative. The governing coalition holds 359 seats in the Chamber of Deputies and 54 seats in the Senate. The centre-right coalition controls 136 seats in the Chamber and 25 in the Senate. The remaining seats in both bodies went to smaller parties that were not members of either coalition. The seats awarded to most parties mean little, since so many are represented in Congress and they operate without any real form of party discipline. Political Stability and Risks
Brazier’s largest cities are some of the most dangerous in the world. Brazil is regarded as the second largest national market for cocaine in the world. Nationwide protests erupted in 2013. Protesters are angry at corruption and high spending on next year’s World Cup. In response, the government announced a new plan to improve public transport and to channel oil royalties to education. International Issues Brazil has a long-standing disagreement with Argentina over the use of waterways for power generation but keeps its objections muted because both countries are members of Numerous. Government Finance
A stimulus totaling US$I billion was announced in May 2012 to help the car industry and other manufacturers. The stimulus Page 2 of 9 consisted mainly of tax cuts. This was followed in August 2012 by a second stimulus that could inject up to IIS$66 billion into the economy over the next five years. The first part of the plan includes the appropriation of ports, lower energy costs and incentives for industry. Huge investments in the country’s road and rail system are also planned. With all this additional spending, the government was ultimately forced to admit that it only met the fiscal deficit target for 2012 (3. Of GAP) by omitting some infrastructure spending and other financial manipulations. Brazier’s public debt totaled R$3,014 billion in 2012, equivalent to 68. 5% of GAP. In real terms, public debt will rise by 0. 4% in 2013. Spending on social security and welfare accounted for 55. 2% of all government expenditure in 2012, while spending on general public services made up another 19. 8%. Chart 2 public Debt: 2005-2012 Source: Remuneration International from national statistics/Rheostat/MIFF/Octane: Data are in constant 2012 prices ECONOMY Economic Structure and Major Industries
Brazil has a vibrant agricultural sector, employing 15. 1% of the work force. Growth is driven by increases in productivity, improvements in farming practices and expansion of cultivated area. Vast tracts of arable land (up to 50 million hectares) are still not farmed. Yet Brazil produces 40% of the sugar traded on world markets and output is increasing by nearly 20% per year. The country also produces 30% of the world’s ethanol. Finally, Brazil is the world’s top producer of orange Juice and coffee, and ranks second in world production of Soya and meat (beef and poultry) and third or fruits and corn.
Brasilia expects a record harvest in 2013 after a contraction in 2012. Manufacturing accounts for 13. 2% of GAP and employs 13. 3% of the work force. Electronics, computers and software and heavy industries. The automobile industry makes up about one-fifth of the country’s industrial base. Brazil is also one of the world’s leading producers of steel, with a capacity to make 44 million tones per year but there are plans to raise this to 77 million tones by 2016. Manufacturers with export ambitions face some severe challenges. Already inefficient and overpriced after years of protectionist policies, exporters are suffering.
In 2012, Brazil announced US$I billion in tax cuts to help car makers and related industries. The real value of gross manufacturing output fell by 8. 9% in 2012 and the fall continued in the first quarter of 2013. Brazier’s service sector makes up 68. 1% of GAP. Growth increasingly depends on the country’s lower middle class. Tourist receipts (in real terms) grew by 17. 4% in 2012 and gains of 7. 1% are expected in 2013. The future is bright, however, as tourism should benefit greatly from the World Cup in 2014 and the Olympics in 2016.
The three-year build-up to the World Cup is expected to boost the economy by 1. 5% of annual GAP. Brazil expects to spend at least IIS$I,OOH billion on infrastructure associated with the World Cup and Olympics. Retail sales slipped in the first quarter of 2013.. Infrastructure is inadequate. Together, the 2014 World Cup and 2016 ROI De Jeanine Olympics will spur infrastructure investments of IIS$90 billion and IIS$30 billion respectively. In addition, Brasilia has launched a four-year programmer to invest more than IIS$500 billion in logistics, including transportation, energy and social development.
Finally, in August 2012 officials unveiled a plan that granted licenses to private companies to finance and operate badly needed roads and railways. Brazil has an abundance of mineral deposits (for example, bauxite, iron ore, manganese, chrome, lead, zinc, tungsten and nickel) and is the world’s largest exporter of iron. It is also set to become a large exporter of petroleum. In 2012, mining output (in real terms) rose by 9. 4%. Page 3 of 9 Overview of the Economy Brazier’s economy has become much more diversified and stronger in the past few years.