Case Study – Brazil Disparities and Wealth Brazil is the largest country in South America and covers nearly half (47%) of the South American continent.
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Slide 1
Case Study Brazil Disparities and Wealth Brazil is the largest
country in South America and covers nearly half (47%) of the South
American continent. It is currently the fifth largest economy in
the world, is home to the Amazon Rainforest and is a popular
location for tourism. Brazil is also rich in natural resources and
active in world issues such as climate change, giving it
significance on a worldwide scale.climate change
Slide 2
GDP - per capita (PPP): $11,600 (2011 est.) $11,300 (2010 est.)
$10,800 (2009 est.) Life Expectancy 73.1 years - 2010 Source: World
Bank POPULATION 196,655,014
Slide 3
The darkest green have the highest LE (+75); whereas the red is
the lowest (+67) Brazil's literacy rate is 86.4% which is the
lowest of all South American countries. It falls just behind
Bolivia and Peru at 87.2% and 87.7%, respectively. The north-east
of the country which is also the poorest has an illiteracy rate of
17%, the highest, which contrasts with south Brazil where the rate
is 4.7%
Slide 4
Brazil - Origin of Disparities The South-east region is the
economic core region of brazil, has the highest population of 72.4
million Has benefited from spatial flows of labor, raw materials
and capital, last two have come from abroad as well as from
internal sources Region grew rapidly through the process of
cumulative causation, resulted in significant economic growth in
the core but also a negative impact on the periphery, overall
result was widening regional disparity
Slide 5
SE's industries generate large amounts of money for Brazil The
natural environment of the SE provided the region with a number of
advantages for the development of primary industries, warm
temperature, adequate rainfall and rich terra roxa soils have
provided many opportunities for farming, region is important for
coffee, beef, rice, cacao, sugarcane and fruit, large deposits of
iron ore, manganese and bauxite have made mining a significant
industry, gold is still mined, region is energy rich, with large
deposits of oil and gas offshore Hydro-electric power is generated
from large rivers flowing over steep slows, temperate rainforest
provides the raw material for forestry, fishing is important for
many of the coastal settlements
Slide 6
SE contains the main airports and seaports, also has a
significant pipeline network for oil and gas, more transnational
corporation are in the SE, highest population density means labor
supply is plentiful, region also has the highest educational and
skill levels in the country
Slide 7
Car industry is major, Ford, GM, Toyota, WC and Fiat located
there, other industries include food processing, textiles,
furniture, clothing, printing, brewing and shoemaking Raw materials
location in the region and large market have provided favorable
conditions, cheaper imports of shoes, clothes and textiles from
Asia have led to a number of companies in the region closing Other
regions in Brazil - Amazon Rainforest very difficult to develop -
Many shanties on outskirts of cities in Brazil Questions page 79
PG
Slide 8
Origin of Disparities : Brazil, Marching for Real Land Reform
After 10 years of waiting for secure title to the land they occupy
and farm, 35 families in Resende, in SE Brazilian state of Rio de
Janeiro, have joined a huge march to demand effective agrarian
reform - Mario Laurindo protested 14 years ago and for the past 10
years he and his family have lived in the 'Terra Libre' settlement
176 km from the city, he left the 'favela' where he live because he
had no job, food or healthcare and wanted to escape high levels of
urban violence, now he has plenty of food, with his wife and 2
children the family produces enough to subsist on from honey to
bananas, chickens and a few dairy cows, he sells his surplus at a
nearby town
Slide 9
3000 of the activists from Terra Libre are mobilizing in
Brasilia from August 10-19 put on by the MST, the demonstration
includes marches, debates, cultural events in an effort to put
pressure on the government to distribute land within the next 6
months to at least 90,000 families who have been squatting in
different parts of the country since 2003, many camping by the
roadside - The landless movement has carried out land occupations
for the past 25 years, it also seeks better living conditions for
another 45,000 families who have been suffering because they are
still waiting for resources for housing, infrastructure and
production
Slide 10
Terra Libre occupies 460 hectares f an old estate which was
deemed unproductive and which owed its workers the equivalent of $1
million before it was taken over by the MST, they do not have legal
title to the land and the settlers do not have access to credits
and tools from INCRA and many families to whom the government has
granted deeds have not yet received this assistance
Slide 11
Disparities and Change : Life Expectancy in Russia One of the
few developed countries where life expectancy has fallen in recent
years, average of 68 years is 15 years behind that of Japan -
Mortality from non-communicable diseases is the main cause of
death, being 3 to 5 times higher than average rates in the EU -
Heart diseases account for 52% of all deaths each year, death rates
from road traffic injuries, cancer, homicide and suicide are all
high and well above the EU average - Mortality for Russian men
(life expectancy :61) is much higher than in other countries with
similar per capita income levels - Situation is different for Women
(life expectancy 74) who live about 13 years longer than men
Slide 12
Reducing Disparities : Bolivia, Resource Nationalization - An
example of a country challenging the free market philosophy,
recently introduced a resource nationalization policy, along with
Cuba and Venezuela it forms the so-called 'radical block' of
nations in Latin America which are concerned about US economic
power in the region and the exploitative action of TNCs in general
- In may 2006, the president nationalized the country's gas and oil
industry, it has the second largest natural gas reserves in Latin
America, but produces only a small amount of domestic use, the
foreign energy companies were told they had 6 months to sign the
new operating contracts or leave the country, overall Bolivia has
taken control of 82% of the oil and gas in the country leaving the
remainder to foreign countries - Bolivia is adopting a socialist
model of regional commerce and cooperation as opposed to what it
sees as 'US-backed free trade', views the concept of the free trade
area as an attempt by the USA to annex Latin America, the
government is trying to attract foreign investment while at the
same time giving the state a larger role in managing the
economy
Slide 13
Reducing Disparities : The Emergence of China as a Major
Trading Nation After the death of Mao Zedong in 1976, China's
economic policy changed significantly. Mao's successor sought to
end the relative isolation of China from the world economy and to
imitate East Asia's export-led success, economic growth increased
by an average of over 10% a year and exports by 15% a year in the
1980s and 90s, during this 20 year period the Chinese economy grew
8 times bigger and between 1990 and 1998 the umber of Chinese
living on less than a dollar a day fell by 150 million, growth has
continued strongly in the first decade of the new millennium - The
value of China's international trade rose to $2562 billion in 2008
compared with only $1.13 billion in 1950, foreign exchange reserves
totaled more than $2000 billion in 2008, China is now the world's
3rd largest economy, per capita incomes have risen significantly as
a result of strong economic growth and trade ($463 yuan in 1980 to
$22,698 yuan in 2008 per capita income)
Slide 14
- Chinese entry into the WTO was an important milestone in its
economic development, On nov. 15th 1999, the USA and China agreed
in principle to a deal that would allow China to join the WTO,
there were other hurdles to get over however this was the most
important - China attracted a record $92 billion in foreign direct
investment in 2008, Chinese government has made it easier for
foreign companies to expand in China since the country joined the
WTO, major attraction to manufacturers is the cheap labor market
where wages are less that 5% of those in the USA
Slide 15
- China now makes 60% of the world's bicycles and over half of
the world's shoes, it accounts for 20% of the world's garment
exports and it is predicted that this will rise to 50% in 2010 -
China's share of the world trade is still only 4% with a trade
surplus of about $30 billion, however it has considerably more
control over its economy than most other countries, its currency is
not freely convertible, the country was therefore not vulnerable to
the speculation and resulting panic that affected to many of its
neighbors in the 1990s
Slide 16
Reducing Disparities : The Trade in Tea - Tea, like coffee,
bananas and other raw materials exemplifies the relatively small
proportion of the final price of the product that goes to the
producers, the great majority of the money generated by the tea
industry goes to the post-raw material states, usually benefiting
companies in developed countries rather than the poorer producing
nations - A report by the Dutch Tea Institute in 2006 drew
particular attention to the problems of falling prices and rising
input costs, the consequent pressure to limit labor costs of tea
production workers and the urgent need for improvement of labor,
social, ecological and economic conditions throughout the tea
sector in the developing countries - Global tea market is dominated
by a small number of companies, about half of all the tea produced
is traded internationally, annual export sales of tea in its raw
material state are worth almost $3 billion, the retail value of the
global tea business is much higher - The large tea companies wield
immense power over the industry, as many countries now produce tea
they have to compete with each other in an increasingly competitive
market, global supply is rising at a faster rate than consumption,
keeping prices low - Tea producers complain that the global trading
system prevents them from moving up the value chain by processing
and packaging the tea they grow, this is mainly because they would
have to compete with very powerful brands and would find it
difficult to achieve the economies of scale of the global tea
companies
Slide 17
Reducing Disparities : Local Democracy in Kerala - In 1996 the
government of the Indian state of Kerala launched a campaign to
make the village democracy a major development mechanism - The
'Kerala Model' hailed for its very high rate of political
participation has resulted in high levels of literacy and life
expectancy and low levels of infant mortality and caste
discrimination - Initial concentration was on building and
development of infrastructure, improving public services, creating
jobs, involving local people in planning and decision making and
channelling resources to women and to the poorest castes and
classes
Slide 18
Reducing Disparities : Mauritania, Struggling to Develop The
West African nation, at over 4 times the size of the UK covers more
than 1 million km^2, it borders Western Sahara, Algeria, Mali,
Senegal and the Atlantic Ocean, water is a prime concern not just
in the desert and semi-desert areas but also in those zones where
rain-fed agriculture is possible, agricultural production varies
hugely from year to year because of the unpredictability of the
rains - With a relatively small population of 2.365 million, it is
classed as a least developed country, in 2007 its GDP per capita at
PPP was estimated at $2000, for the same years id HDI ranking was
137 out of 177 countries, net ODA in 2006 was US$93.7 million - A
food crisis hit in 2008 when food prices rose sharply leading to a
big increase in food insecurity levels, the level of malnutrition
is high at 12.6% and exceeding 15% in some regions, the feb 2009
food survey showed that 138,000 people in the country are severely
food insecure and 246,000 are moderately food insecure
Slide 19
When the country gained independence from France in 1960,
slavery still formally existed and under 5% of the population lived
in urban areas, today the urban population numbers over 60%,
although starting from a low base there are significant signs of
economic and social progress such as between 1990 and 2004 the
proportion of people living below the poverty line fell from 56% to
40% and the gross primary enrollment ratio reached almost 99% in
2006, since 1995 the gap between enrollment ratios of boys and
girls had almost closed - Exports have depended almost totally on
two commodities: iron ore and fish, iron ore accounts for almost
50% of total exports by value, the relatively low price of iron ore
on the world market and the depletion of some of the best reserves
have made this dependency risky, fortunately the fishing sector has
developed strongly in recent decade but the problem of overfishing
by foreign boats is now causing considerable concern
Slide 20
Discoveries of other minerals, including gold and diamonds
offer possibilities in the future but further exploration will be
required, like all oil-poor developing countries, they can do
nothing but pay the fluctuating market price for its essential oil
imports, however the discovery of oil off the coast in mid 2001 may
have solved this problem if the reserves prove economic to exploit
- The periodic need to import food is a major obstacle to achieving
a trade balance, a high rate of rural-urban migration in recent
decades has increase the number of people dependent on other to
produce their food, acute periods of drought, notably in the 1970s
and 80s have exacerbated the situation, rice production has been of
particular concern, yields can vary significantly from year to year
depending on rainfall and other factors, thus it is not always
self-sufficient in rice, imported rice is often favored as it tends
to be less expensive, livestock rearing accounts for 15% of
GDP
Slide 21
A number of development programs are in operation : Sustainable
Rural development (objective is to stem the degradation of
vegetation cover and to improve the environment by enabling local
populations to rationalize the use of natural resources), The
Senegal River Valley (objectives are higher agricultural output,
wider crop diversification, a reduction in rural poverty, improved
food security and a better ecological balance), The Oasis
Development Project (objective is to improve the living standards
of the poor people in the oasis zones), Nouakchott (objectives are
to improve water and electricity supply, upgrade educational
facilities and make microcredit facilities available for the
creation of small and medium sized businesses), Tourism (objective
is to avoid mass tourism and its pitfalls and to target special
interest groups and adventure tourists)