Emerging Markets: Brazil Case Study
Brazil’s agricultural advantage stems from its extensive natural resources. The country’s competitors either utilize more supplies or more time in order to yield an amount that can rival Brazil’s production. Although every other country desires the agricultural production capable of Brazil, Brazil‘s government is determined to invest in industrialization in order to modernize its economy. While Brazil has a large amount of natural resources available for use, its government must provide the funding of the growing industrialization, to include: energy, materials, and increased employee earnings. II. Problem
Brazil’s success in agriculture is attributed to vast lands, diverse climates, and a large population pool for labor (Brazil Agribusiness Report - Q4 2013, 2013). Without regard to its solid base in agriculture, the Brazilian government is attempting to modernize the economy through industrialization. Alongside this movement comes the “Brazil” cost: the increased operating cost of energy, raw materials, and wages. Also, in addition to paying more to industrialize, the government compensates domestic, uncompetitive industries enabling the theory of protectionism. III. Effective Solutions/Strategies
In response to Brazilian President Dilma Rousseff’s desires to become a world-class manufacturing base, the country can reassess its comparative advantage in agriculture and redirect resources solely to those businesses. According to Brazil Agribusiness Report - Q4 2013, its agricultural production is yielding lower than expected numbers with respect to international standards and, therefore, still has potential for growth. Alternatively, Brazil can strategize by addressing agricultural weaknesses via industrialization. First, seize the opportunity to grow and re-attack infrastructure to promote expansion and competition. Then, allow for raised incomes, as they will decrease farmers’ debts and allow...
References: Brazil: Economic background. (2006). (). New York: The Economist Intelligence Unit. Retrieved from http://search.proquest.com.ezproxy.libproxy.db.erau.edu/docview/466598073?accountid=27203
Brazil Agribusiness Report - Q4 2013. (2013). (). London: Business Monitor International. Retrieved from http://search.proquest.com.ezproxy.libproxy.db.erau.edu/docview/1436333107?accountid=27203
Please join StudyMode to read the full document