The Brazilian decade

Marc Margolis – Newsweek, 12/30/2012

About 15 years ago, on assignment in Bolivia, I met a pair of local drug-enforcement agents who were kicking back in a hotel bar. The conversation was light and easygoing, until I mentioned I was based in Brazil. “Ah, Braaaazil,” said one of the agents, peacocking for effect. “The land of ‘the biggest in the world.’” I wrote his comment off as Latino envy, that familiar jolt of resentment, which served as the subtext of many conversations about the giant of South America and the neighbors it dwarfed. The comment was also a telling expression of how people viewed the old Brazil, the hemisphere’s large underachiever, a nation that frequently waxed grandiose and then fell short of hype and expectations.

Much has changed in Latin America since then, nowhere more so than in Brazil. Stable, democratic, stylish, and self confident, this $2.5 trillion economy now has some backbone behind its swagger; it still stirs resentment among its neighbors—Brazilians are the new gringos—but not so many jokes these days. Instead, from inflation control to social welfare policies, from the campaign trail to the catwalk, the state of Latin America in 2013, and in years to come, will most likely be shaped by what happens in this restless country of 197 million. Welcome to Latin America’s Brazilian decade.

Brazil, of course, is not the only game in town. Peru leads the hemisphere in economic growth, with GDP set to expand by 6 percent this year, nearly twice the Latin American average. Under the deft leadership of Juan Manuel Santos, Colombia has strengthened trade with China, courted onetime mortal enemy Hugo Chávez of Venezuela, and even resurrected peace talks with guerrilla insurgents, turning the modest Andean nation into a magnet for investment. Chile—the stellar outlier—has practically decoupled from the continent with its established tradition of free-market policies and an aggressive export industry that long ago made the pivot to the Pacifi c. Even Mexico, while bloodied by a six-year, futile drug war, is showing signs of revival with population growth slowing, public spending under control, and a long-awaited boom in manufacturing exports finally kicking in.

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