POM in Brazil

Topics: Juice, Brazil, Culture of Brazil Pages: 6 (2078 words) Published: February 15, 2014
Brazil, the largest country in South America, fifth largest country in the world, sixth largest economy in the world, and second largest emerging market worldwide is a vigorous marketplace to enter. Disposable income has increased significantly in recent years, GDP, driven by significant rises in exports and less reliance on imports, has made the country one of the world’s best performers, and investment in infrastructure and services, driven in part by global sporting events, has raised the standard of living not just in major cities but also more rural areas. There is a global spotlight on Brazil right now due to hosting a major U.N. sustainability summit this year, the World Cup in 2014 and the Olympics in 2016. With a population of over 201 million and a forecasted economic growth rate of over 2.5% annually, Brazil looks to be an advantageous market to introduce POM Wonderful to.

Brazil makes up nearly 47% of South America and borders on the Atlantic Ocean. It borders all the other countries in South America, except for Equador and Chile. The climate is mostly tropical except in southern parts where the climate is more temperate. Brazil also hosts dense forests, moutntains and hills in the northern regions while the southern areas have more plains including the world’s largest wetland region with coastal lowlands.

Brazil has many natural resources that has helped in the enhancement of the financial status of the country. The government is making sure to take care of these resources by preserving them as the country is completely dependent on the exports of those natural products. Amongst the major exports of natual products are iron ore, coffee, sugarcane, rubber, and soybeans. Brazil is also the world’s biggest exporter of orange juice, exporting 80% of all orange juice in the world. Additionally, they have begun to be a major exporter of beef and poultry and doubling its international supply of copper over the next three years, or about 1.5% of world supply. (http://topics.bloomberg.com/brazil%3A-the-rise-of-a-natural-resources-superpower/)

In 2010, there was a $2billion loan made by the Export-Import Bank (government run) and secured by JP Morgan from the United Sates to Petrobras, a major oil company in Brazil. This loan has had a massive impact on the oil industry in Brazil and it is this type of activity that has enabled the country to be self-sufficient in oil and a major player in the global energy market. The Campos Basin and the Santos Basin hold massive reserves of untapped oil. Petrograd, the largest company in Brazil, is focusing not just on extraction but conversion and refinement, making oil one of the country’s most attractive job markets. Projections for job growth in oil and gas are showing an increase of almost 16% over the next ten years. This is very important economic information to consider when choosing a country to enter their market place. (http://assets.huxley.com/guides/Brazil_livingandworking.pdf ; http://www.forbes.com/sites/kenrapoza/2011/03/17/dispelling-the-petrobras-loan-myth-as-obama-heads-to-rio/)

Brazil has a multi-party political system, where more than two political parties have a chance to attain political power (either separately or together). During election period, Brazil votes on a president for a four-year term, with no chance for re-election. The majority of Brazil’s legal structure is based on a civil law, or civil codes. These civil codes generally cover areas that involve property and family law, torts, contracts, and wills.

Brazil’s currency, the real, is nonconvertible, so it is not available for trade on the forex market and cannot be bought or sold outside Brazil. The Banco Central do Brasil maintains close control of the Brazilian currency market through Sisbacen, the Central Bank’s information system. The system functions as a virtual environment where currency transactions and operations are officially authorized and conducted. Import...
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