The Federative Republic of Brazil, or simply Brazil, has been mainly known for its soccer aptitude, and it's magnificent surroundings. However, behind this gigantic nation, lays a newly emerged economic powerhouse - currently holding the 6th largest economy by nominal GDP, according to CNN Money. Brazil is also the largest country by territory in South/Latin America and 5th largest country by region in the world. As of now, Brazil is ready to leave its emerging market status and become one of the most developed countries on earth. This paper will explore Brazil's economic growth - by providing details through personal knowledge and extensive research - on recent economic data and future provisions. .
I. Economic Development History .
During the early 1950's, Brazil had just started its industrialization process. It expanded important parts of its economy by investing in the automobile industry, steel, and petrochemicals. Interestingly, during the Second World War, Brazil's Gross National Product was among the highest in the world – with a 7.4%. After the war was over, investments geared towards what seems to be one of the biggest problems the country faces today: infrastructure. With this capital infusion, Brazil started showing signs of becoming a potential powerhouse in the near future. Impressively, it's GDP increased to 8.5% per year, from 1970 to 1980 (Embassy of Brazil in Wellington).
Unfortunately, during the 80's, Brazil wasn't able to invest because of the suspension of capital inflow and high interest rates imposed by the United States. During the 1990's, Brazil faced lots of economic reforms. Such as: deregulation, privatization and trade liberalization. (Embassy of Brazil in Wellington) It also faced a very resilient problem: hyperinflation. According to the San Jose State University, this problem was mainly caused due to the expansion of money supply. In 1990, inflation in Brazil reached an astonishing 30,377%.
