Study finds Brazil’s state to be tax-guzzling, inefficient

April 22, 2014

Thalita Carrico – The Financial Times, 4/22/2014

You cannot stay one day in Brazil without hearing someone complain about high taxes and poor public services. According to this narrative, the prices of everything from cars to beauty products are inflated by opaque taxes even as the nation struggles with sub-standard hospitals, inadequate public transport and other services.

Now a study from a consulting company, Brazilian Institute of Planning and Taxation (IBPT), seems to bear out the common perception about Brazil’s tax burden. It ranked Brazil last in a list of the 30 countries judged by taxation versus quality of services.

Topping the list was the US, Australia and South Korea. Among emerging markets, Slovakia ranked 11th and Uruguay 13th. Surprisingly, even Argentina, with its problems with inflation and chaotic economic policies, ranked higher than Brazil.

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Brazil and Argentina clash over auto-export restrictions: top level mission heads for Buenos Aires

April 22, 2014

Merco Press News, 4/22/2014

According to the president of the Automobile Manufacturers Association from Brazil, Anfavea, Luiz Moan, President Dilma Rousseff instructed Minister of Development, industry and foreign trade Mauro Borges to organize a round of urgent formal talks with Argentina to discuss the issue.

“During the meeting with President Rousseff we explained that Argentine measures in the first quarter of 2014 have meant a drastic drop of 32% in automobile exports to Argentina, which is a great blow for the industry” said Moan who added he spent three hours talking about the issue with the Brazilian head of state.

Moan also recalled that Brazil and Argentina signed a memorandum of understanding last March to try and generate financial mechanisms to promote bilateral trade.

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Brazil tourism forecast cools for World Cup

April 21, 2014

Claire Rivé-The Rio Times, 4/15/2014

The tourism sector in Brazil has had to adjust their inflated estimates concerning the expected influx of tourists during the FIFA World Cup in June and July this year, leading to big discounts on local and international flights and accommodation during the tournament.

Following a disappointing 2014 Carnival period, slow bookings for the World Cup has made many of the country’s biggest tour agencies and airlines reduce their prices by up to ninety percent during June and July.

Demand during the World Cup month doesn’t look likely to reach the Ministry of Tourism’s estimated 600,000 foreign visitors and many Brazilians uninterested in the event are also seeing the nation-wide school holiday as an opportunity to dodge the madness and take family holidays to other destinations.

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World Cup to kick up prices in inflation-weary Brazil

April 21, 2014

Alonso Soto – Reuters, 4/21/2014

As if worrying about unfinished stadiums and overcrowded airports wasn’t enough, the upcoming football World Cup will give Brazilian policymakers another headache: an inflation spike.

The arrival of roughly 600,000 foreign tourists for the month-long tournament that starts in mid-June will likely cause substantial increases in the prices of airline tickets, restaurant meals and hotel rooms.

Those three areas account for about a tenth of the weighting of Brazil’s benchmark IPCA consumer price gauge. That could spell trouble for President Dilma Rousseff as the inflation rate is already at 6.19 percent.

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Murders soar in Brazil World Cup city during police strike

April 18, 2014

Silvio Cascione – Reuters, 4/17/2014

A police strike ended on Thursday after unleashing a surge in violent crime in Brazil‘s third-largest city just two months before it is due to welcome hordes of football fans for the World Cup, authorities said.

At least 39 homicides were committed during the two-day strike in and around the north-eastern city of Salvador that added to fears about Brazil’s ability to ensure public safety during the global football tournament.

Violence swept the city after state police went on strike on Tuesday night to demand better pay and other benefits, prompting the federal government to dispatch troops to restore order in Salvador and nearby towns.

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With Brazil’s Petrobras under fire for corruption, have Brazilians had enough?

April 18, 2014

Whitney Eulich – The Christian Science Monitor, 4/18/2014

Brazil’s leading Worker’s Party is under intense scrutiny this week amid Senate hearings and mounting allegations of corruption at Petrobras, the state-run oil company.

This is the second high-profile corruption scandal to plague the ruling party in the past decade. The landmark 2005 Mensalão case, where 38 national politicians were accused of crimes ranging from money laundering to tax evasion in a vote-buying scandal, ended in the conviction of 25 people in 2012. In recent weeks, pressure on the Worker’s Party (PT) has mounted amid allegations that Petrobras paid nearly triple the market rate for a refinery in Texas, and that management accepted millions of dollars in bribes from a Dutch oil-rig supplier.

Latin America has long been associated with widespread corruption and impunity – seen in everything from tax evasion to the flaunting of red lights at intersections. As corruption cases become more visible in Brazil, however, laws to battle them have been passed and political representatives have pushed for public inquiries into wrongdoing. Yet while the issue is garnering attention, attitudes are changing only slowly.

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Brazil’s Campos targets taxes, Petrobras to boost economy

April 17, 2014

Brian Winter & Jeferson Ribeiro – Reuters, 4/17/2014

Eduardo Campos, the centrist former state governor running third in Brazil‘s presidential race, plans to lower the tax burden and set a formula to automatically raise fuel prices at state-run oil company Petrobras if he wins the October election.

In a wide-ranging interview, Campos defended those and other reforms championed by Brazil’s business community, which has largely soured on left-leaning President Dilma Rousseff after three-plus years of slow economic growth.

Recent polls show Rousseff with a clear lead as she seeks a second term. She has around 40 percent support thanks to strong backing from poorer Brazilians who are happy with government welfare programs and unemployment still at record lows.

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Brazil: a role model for development?

April 17, 2014

Armando Barrientos & Ed Amann – The Guardian, 4/17/2014

Brazil isn’t getting the best press at the moment, with ongoing problems with the construction of the World Cup stadiums and protests about public services. Recently economic growth in the country has slowed, with some commentators arguing the recent government response sounds “the death knell for Brazil’s economic strategy“.

It’s remarkable how far and fast Brazil has fallen from grace. Only a couple of years ago, the IMF and others were lauding the country for its resilience to the global financial crisis and its sound economic management.

We need to get this into perspective, because behind the hyperbole, there’s much for other developing countries to learn from Brazil’s recent experiences. Countries such as Zambia, which has seen positive growth rates that haven’t translated into poverty reduction, or Nigeria, which has seen inequality dramatically widen over the past 20 years.

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Farmers seeking heat relief signal Brazil climate peril

April 17, 2014

Raymond Colitt – Bloomberg, 4/17/2014

Brazil may see a mass migration of crops and farm workers from huge swaths of currently tillable lands to more temperate zones as global warming takes hold, according to leading climate experts in the country.

Longtime Brazilian climate researcher Hilton Silveira Pinto points to the drought that’s cutting grain and coffee output this year as an indicator that rising global temperatures may already be impacting the country’s crops.

“This is a taste of what is to come in the future,” said Pinto, a professor at theCenter for Meteorological and Climate Research Applied to Agriculture at the University of Campinas.

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Brazil’s anti-FIFA protests: not little, but definitely late

April 17, 2014

Kenneth Rapoza – Forbes, 4/16/2014

As ironic as it may sound, the kingpin of FIFA World Cup soccer has managed to stage the biggest anti-FIFA protests ever.

This is Brazil, land of contrasts, where a small five cent bus fare hike last June turned into a hate fest against all that was once holy in the Land of Pele. With less than two months to go before the “beautiful game” commences in a match between Brazil and Croatia in São Paulo, millions of Brazilians want you to know that you shouldn’t come to their country to see these games. In the local and global press, word is Brazilians now hate soccer.

First some brief soccer history for American readers. Brazil is the only country not to have missed a World Cup, meaning its national teams have always won qualifying rounds every four years when the games are held. They have five World Cup championship titles and have won three in the last four decades, more than any other country. They are home to world famous footballers like Kaka, Ronaldinho and of course Pele.

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