Three Causes Of Brazil's Sputtering Economy And How You Can Help


In 2011, Brazil bypassed England to become the sixth-largest economy in the world. Everything seemed rosy, as the nation planned to host two of the world's largest sports events, the soccer World Cup and the Summer Olympics.

Yet, Brazil has sputtered along economically. Why is this? How can those living outside Brazil help?

1. It is A Nation of Economic Contrasts

Brazil has always been a nation of stark economic contrasts, some with wealth, others mired in poverty.  In the colonial past, the North held all the riches, with its sugar plantations. Then, during the Republic years, this power transferred mostly to the South, where the coffee oligarchs ran things.

In the 21st century, this extreme wealth gap persists. Now, it is Sao Paulo, along with Rio and a few others states, that drive the economy; meanwhile, the rest of the nation experiences economic stagnation. In fact, the Southeastern-axis of Sao Paulo, Rio and Brasilia account for over a fifth of the entire national economic production.

2. It is a Large Nation

Brazil is a big nation, the largest in South America and fifth in the world, with over 3.2 million square miles of territory. As such, there are swaths of underdeveloped territory. Infrastructure remains poor throughout the country. Seemingly simple concerns, such as getting goods to markets, are chores in this country.

3. The People Speak Portuguese in a Mostly Spanish Environment

Communication is a problem. Unlike almost all of their neighbors, Brazilians speak Portuguese. In general, while a Portuguese speaker can understand a Spanish speaker, vice-versa is untrue. Brazilians, thus, cannot migrate to other South American nations that are experiencing economic boom in order to get needed jobs. The language barrier proves a problem. Instead, these unemployed people stay home.

Sending Money as a Way to Improve Conditions

Remittances can help. Sending money to Brazil is one way to encourage economic growth, despite the above domestic problems. Relatives who live in the United States are one source of remittances. These people have the potential to sway economic outcomes, as proven in the case of Mexico.

Money sent from the U.S. to its southernmost neighbor amounts to over $20 billion and, along with oil, accounts for much of Mexico's national income.There are over a million Brazilian immigrants in the United States, who can help people at home by transferring money.

Friends are the other source of remittances. Those who have visited Brazil and made acquaintances may want to transfer money to Brazil on a regular basis.



15 October 2015

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