The New Development Bank: The start of a new economic consensus?

July 21, 2014

Erica Kliment – Brazil Institute, 7/21/2014

2014 BRICS Summit in Brazil

The leaders at the 2014 BRICS Summit in Brazil

Is the rest of the world ready for a new order upheld by developing nations? In 2010, when former President Luiz Inácio Lula da Silva invited then-President Mahmoud Ahmadinejad of Iran to the Itamaraty Palace in Brazil, the meeting was highly criticized by the Obama administration. Lula, who had seemed to enjoy international acclaim when dealing with regional politics, was then chastised when he had reached too far out of the western hemisphere. His response was that he was merely attempting to better situate Brazil on the global stage, yet could the criticism have come from the fact that larger power players did not believe Brazil was ready to graduate from the role of regional babysitter?

Four years later, with an unexpectedly successful World Cup under Brazil’s belt and planning on another fruitful mega-event in just two years, the Summer Olympics in Rio de Janeiro, the developed world seems slightly more willing to accept developing nations’ role in the international sphere. Individually, these nations’ global clout is diminishing with slowing economic growth rates, yet collectively, they have the potential to create a new platform upon which they and future developing nations can flourish. Towards the close of the most recent BRICS Summit, five of those countries reached an agreement that, depending on its success, could bring developing nations one step closer to the position they desire – the forefront of international affairs.

During the 2014 BRICS Summit in Fortaleza, the leaders of Brazil, Russia, India, China, and South Africa jointly created the New Development Bank, a multinational fund of $150 billion in capital to provide stability and finance infrastructure for the five developing nations involved in the negotiations as well as future emerging markets. It will be headquartered in Shanghai with its first president from India, on a five-year rotating schedule, and with Brazil taking chairmanship of the board. Read the rest of this entry »

Brazil police occupy drug-infested Rio slum

August 5, 2013

Associated Foreign Press, 08/05/2013

Some 180 elite Brazilian police officers deployed into a drug-infested slum complex in northern Rio on Monday in order to prepare the way for a permanent presence there.

“We are here to stay,” Rio state governor Sergio Cabral told the daily O Dia.

The Mangueirinha complex, located in the Baixada Fluminense district, is home to 25,000 people and comprises the Corte 8, Sapo, Santuario and Mangueirinha favelas.

Read more…

In the Spotlight: Are Brazil’s world class events a catalyst for growth or misallocated public spending?

July 19, 2013

Carolina Cardenas – Brazil Institute, 07/19/2013


Ever since Brazil achieved macroeconomic stability with the implementation of the Plano Real in 1994, the country has come a long way, surpassing the UK to become the 6th largest economy in 2012. Sound economic policy coupled with a recent commodities boom allowed for decreasing poverty levels, rising purchasing power, and an addition of forty million Brazilians to the country’s middle class.  Along with economic growth has come a strong desire for international recognition. As one of the four original “emerging markets,” coined BRICs, Brazil has sought to expand its presence in international organizations. This can be seen in the country’s ongoing request for a permanent seat on the United Nations Security Council and the appointment of Roberto Azevedo as director general of the World Trade Organization in 2013.  This global growing emergence has also translated into a growing tide of hosting world class events.  In an attempt to further elevate Brazil’s world status, the country will be hosting the 2014 FIFA World Cup and the 2016 Olympic Games.

In addition to international expansion, there is a second trend that has emerged as a result of Brazil’s economic growth. Widespread protests that have taken over the country’s streets since mid-June are representative of a Brazilian society that is demanding more from its government. Brazil’s expanding middle class has become more educated and further exposed to examples of transparency and ‘democracy with equity” worldwide, setting this benchmark for itself. Citizens are demanding better public services, infrastructure, education, health care and a change in the framework of Brazil’s democratic system. The government’s decision to host the World Cup followed by the summer Olympics has propelled Brazilian civil society to initiate a necessary debate on public spending priorities.

There are two phenomena taking place concurrently: Brazil’s desire to emerge globally and the citizens’ desire for better public services domestically. Although many consider these to be conflicting, hosting mega events at a time of pressing social need presents an incredible opportunity for boosting development. If used positively, the World Cup and Olympic Games could accelerate investment in infrastructure and improve services to meet international standards. However, perceptions of protesters at the moment are that, “the quality of urban life worsened as precedence was given to internationally prestigious events that ended up absorbing the investments that were supposed to improve transparency, education, and public services in general.”

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Brazil at historic low No.22 in FIFA ranking ahead of Confed Cup; US rises 1 spot to No.28

June 7, 2013

Associated Press – The Washington Post, 06/06/2013

Brazil has dropped to a historic low of No. 22 in the FIFA rankings a year out from hosting the World Cup, and the United States has moved up one spot to No. 28.

Brazil fell three places this month as it continues to play only exhibition matches. They score less than competitive matches in FIFA’s calculations, which have ranked teams since 1993 across a four-year results cycle.

The South American country can make up ground when it hosts the eight-nation Confederations Cup warm-up event this month.

Read more…

In the Spotlight: Brazil’s cocaine epidemic

February 25, 2013

Compiled by Christopher Martin – Brazil Institute, 02/25/2013

Photo credit: Lunae Parracho, Reuters

Photo credit: Lunae Parracho, Reuters

In recent years, Brazil has enjoyed economic success, rising purchasing power, a growing economy, and decreasing poverty levels, which have turned it into a more attractive market for drug trafficking.  As cocaine use in the United States, the world’s largest cocaine consumer, has fallen by an estimated two-thirds in the past thirty years, South American drug traffickers are increasingly turning towards Brazil’s growing market.  This is proving to be an effective and profitable strategy; recent years have seen cocaine consumption quickly rising and health officials say a nation-wide crack-cocaine epidemic is taking hold.  This is obviously not the image the South American giant wishes to project as it prepares to host the 2014 FIFA World Cup, followed by the 2016 Summer Olympics.

With respect to cocaine, Brazil has a border control problem that no other nation in the world has: it shares half of its 10,000-mile-long border with the world’s three biggest cocaine producers: Bolivia, Colombia, and Peru.  To make matters worse, much of this border falls in difficult-to-control, remote, and largely unguarded jungle areas.  Colombia, which was long the world’s top cocaine producer, has seen the amount of land used for coca leaf production, as well as its ability to produce cocaine, tumble in recent years.  However, the decrease in Colombian cocaine production has been eclipsed by Peru and Bolivia, which have seen significantly ramped up production in recent years.

The source of cocaine in Brazil is increasingly landlocked Bolivia, which shares a 2,126 mile border with Brazil, which is longer than the Mexico-U.S. border.  Much of the border lies along the Mamore River, separating Bolivia from the Brazilian state of Rodonia, which is patrolled by federal police agents who are under staffed, ill equipped, and must count on a degree of luck to determine which of the countless boats crossing daily are transporting drugs.  To make matters worse, the river is dotted with many small and isolated ports that can be used by traffickers to evade authorities.  However, according to Sabino Mendoza, an adviser on coca issues to Bolivian President Evo Morales’ government, Bolivia does not consider itself to be a cocaine trafficking country.  Mr. Mendoza said the problem is cocaine originating in Peru that makes its way through Bolivia en route to Brazil.  “For us and for Brazil, obviously it’s a concern,” he said.  “And between the two countries we are resolving it.” Read the rest of this entry »

Guest post: Brazil’s advancing democracy

October 22, 2012

Paulo Sotero – Financial Times, 10/19/2012

Democracy is not for the faint-hearted… It requires hard work, constant attention, takes a lot of time to build and can easily be undermined by political polarization, regressive campaign finance rules and deficient laws on political representation. This month, two major events shed light on both the successes and failings of Brazil’s quarter century old, vibrant democracy.

On October 7, municipal elections brought over 115m voters to the polls to elect mayors and councilors in 5,568 cities and towns. A few days later, the country’s Supreme Court returned guilty verdicts in the largest trial of political corruption in Brazilian history.

The municipal elections were the first since the adoption of a new law barring candidates with criminal records. Cast in electronic ballot boxes, votes were tallied and results were published four hours after voting booths closed. There were no legal challenges. In 50 municipalities, including 17 of the 26 states capitals, where no candidate cleared the absolute majority of 50 per cent plus one, the two top candidates will go into a second round on October 28. The top prize is São Paulo, Brazil’s economic capital and home to the country’s third largest public budget.

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Insight: Taking on the “toga-wearing bandits” in Brazil’s courts

September 10, 2012

Brian Winter – Reuters 9/6/2012

Eliana Calmon takes great delight in provoking people. But even she didn’t realize at first what a bomb she had dropped.

“Look, I use a lot of colorful language, so when I said it, it didn’t seem that bad. But then the interview ended,” she recalled, starting to chuckle, “and I peered over at my aide, and he looked like he had seen a ghost! … And that was when the whole storm started.”

The offending phrase: Calmon, who serves as a kind of ombudswoman for Brazil’s judicial system, said her work was being undermined by “bandits who hide behind their togas” — corrupt judges who, she said, favor special interests and line their pockets with cash while doing as little work as possible.

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