Brazil An Economy Recovering From Chaos
Brazil earned the reputation of being a "miracle economy" in the late 1960s when double-digit annual growth rates were recorded and the structure of the economy underwent rapid change. Since 1981, however, Brazil's economic performance has been poor in comparison to its potential. The country's dramatic reduction in output growth, which averaged an annual GDP growth of only 1.5 percent over 1980-93, reflected its inability to respond to the events of the late 1970s and 1980s. Some events that took place during this period were: the oil shock, increases in real interest rates, the debt crisis, and the resulting cutoff of foreign credit and foreign direct investment.These shocks, in combination with poor management of public finances and heavy state intervention, resulted in large fiscal deficits at state and federal levels. Even if the fiscal deficits were reduced after 1990, deviating policies generalized indexation, and exchange rate management contributed to keeping inflation high and increasing. Monthly inflation skyrocketed from 3 percent in the late 1970s to 50 percent in mid-1994. The country's income distribution, already poor, worsened drastically in the 1980s. Against these conditions, the success of the Real Stabiliz
By mid-1999 it had an estimated population of 166 million (Levine 200). Opening their market to the world will contribute to the economic welfare of the country. The share of its primary sector in the gross national product declined from 28 percent in 1947 to 11 percent in 1992. While the economic changes since 1947 raised the country's per capita income above US$2,000 in 1980, per capita income in 1995 was still only US$4,630. 5 million television sets, and 3 million refrigerators. Significant changes began occurring only late in the eighteenth century, when slavery was eliminated and wage labor was adopted.
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