Brazil is divided politically and geographically into five different regions which share common features in relation to their physical, human, economic and cultural aspects. The borders of each region - North, North-East, South-East, South and Centre-West coincide with the borders of the states which they comprise.
The North region covers the major part of the Brazilian territory, with an area that corresponds with 45.27% of the 8,547,403.5 km2 that makes up the total area of Brazil. Comprising seven states, its area is almost completely dominated by the Amazon River basin. The North-East region may be considered as being the most heterogeneous in the country. Divided into four vast areas - mid-north, forest area, wild lands and backlands - it occupies 18.26% of the Brazilian territory and comprises nine states.
The South-East, Brazil's most important region from an economic point of view, also contains the highest concentration of population - 42.63% of Brazil's total population of 157,079,573 - and industrial production. It is made up of four states and presents major differences in relation to its physical aspect, with a coastal strip, mountains and plains.
The South, Brazil's coldest region which undergoes periods of frost and snow, is the smallest region, occupying 6.75% of the Brazilian territory and comprising just three states. The rivers flowing through this area form almost the entire Paraná Basin and are of great national importance, chiefly because of their hydroelectric potential.
Lastly, the Centre-West region is basically dominated by the Central Brazilian Plateau and may be divided into three portions: Goiano-Mato Grosso Massif, Paraná sedimentation basin and the depressions. Comprising four states, this region has been undergoing significant changes in relation to its vegetation with the cerrado (scrubland) being gradually replaced by plantations or cattle-rearing as a result of the process of occupation that has taken place in this part of Brazil.
Enivronment:
In the early stages, concern for the environment was often confused with the struggle to defend Brazil's forests. During the first four centuries of human occupation, in the Central South and North East regions, development of these regions was at the cost of the destruction of the forests. "Cerrados", rocky plains and bush country ("caatingas") were all considered marginal areas and therefore received marginal attention. Agricultural development demanded the destruction of forested areas. Until the 1950s, coffee accounted for around 90% of Brazilian exports. Coffee bushes are greedy plants which quickly exhaust the soil and require extremely fertile land. Coffee growing on an economically significant scale began in the vicinity of Rio de Janeiro, the city which was made the royal capital by Dom João VI. Later it migrated down the Paraíba do Sul Valley. It spread to São Paulo state, particularly around Campinas, then to the west of the state and into the northwest of Paraná. It also took root in the south of Minas Gerais and parts of Espírito Santo state. In the Northeast region of Brazil, the main agricultural activity was and still is the cultivation of sugar cane for the production of sugar and alcohol, and this has also become very important in the Southeast region. Until the middle of the twentieth century Brazil was basically an agricultural nation.
During and after the First World War, industry began to develop, mainly through the activities of Italian and Italian - Brazilian manufacturers, such as the Matarazzo, the Crespi and the Bardella, as well as of businessmen of Lebanese, Syrian, Portuguese and German descent, among others
Roberto Simonsen was the architect of Brazilian policies of market reservation for manufactured products. It was the era of "similar national products". If there was a "similar national product", Brazil would not need to import the manufactured products of other countries. Dom João VI opened the ports of Brazil to the world. Roberto Simonsen and his followers closed them, by prohibiting or restricting the import of manufactured goods. This was the ideology of Great Brazil, whereby the country was seen as under siege from the other nations of the planet. Market reservation may have been necessary at the time, but it was not a sustainable policy over the longer term. Only after 1980 did Brazilian ports begin to be reopened to the world, a process which continued under the Collor government (1990-1992) and even more under the governments that followed.
Today we live in the age of Mercosul, the age of the global economy, the age of profound respect for the market. Coffee now accounts for about 10% of Brazilian exports. Production has diversified and in many sectors Brazilian products are competitive even in our globalised world.
The features of Brazilian economic evolution summarised above not only had profound consequences in speeding up the country's development but also had an enormous environmental impact.
Economy:
A key feature of technological progress in the last three decades has been the contrast between the accelerated decline in information costs and the relative stability of transportation costs. This disparity fuels the concurrent trends toward the globalization of markets and the regionalization of the productive apparatus, which have characterized the world economy in the recent past. These trends have also redefined the pattern of the integration of national economies into the international economy and the priorities of the multilateral trade agenda.
The new patterns of international competition have increased the importance of the provision of services, technological innovation, and direct investment abroad as supporting pillars of the export performance of national economies. These patterns have reduced the effectiveness of conventional instruments of trade policy, such as tariffs, quotas, and safeguards. They have also added new issues to the multilateral trade agenda, such as the use of domestic regulations to protect industries on the technological frontier and anticompetitive practices of an international scope.
The new patterns of international competition have increased the importance of the provision of services, technological innovation, and direct investment abroad as supporting pillars of the export performance of national economies. These patterns have reduced the effectiveness of conventional instruments of trade policy, such as tariffs, quotas, and safeguards. They have also added new issues to the multilateral trade agenda, such as the use of domestic regulations to protect industries on the technological frontier and anticompetitive practices of an international scope.
From the standpoint of national economies, the pursuit of productive efficiency, encouragement of innovation, and better conditions for the participation of domestic enterprises in the world economy have become complementary elements of a common challenge. For the government, this implies the convergence of the industrial, technological, and foreign trade policies as well as the consistency of these policies with other government initiatives in the sphere of macroeconomic plans and the regulation of competition conditions on the domestic markets.
A further challenge implicit in today's scenario lies in the fact that the World Trade Organization-WTO does not yet have the necessary regulatory instruments to address the prevailing competition patterns. Although the ministerial meeting held in Doha in November 2001 ratified the international community's consensus on the need to strengthen the WTO, in practice this consensus has meant only that the member countries are committed to proceed with the round of negotiations, but does not warrant any optimistic forecast of the results of this endeavor in the near future, given the magnitude of the challenges faced by the WTO at the moment.
A good illustration of WTO's current limitations is the competition policy, which has taken on a key role on the international plane, with respect not only to fighting monopolies and surveying the conduct of transnational corporations but above all to settling conflicts stemming from the protection of high technology industries. The discussion of these issues at the WTO has been intense since December 1966, when the Work Group on the Interaction between Trade and Competition Policy was set up. In the following years, 170 government documents were submitted to the Work Group covering a substantive agenda that went far beyond the relations between trade and competition. Despite active participation by all WTO members that have competition legislation, the debate has been limited to two kinds of restrictions. On the one hand, any multilateral agreement on competition rules will be meaningful only to the extent that all WTO members, or at least their great majority, are able to apply those rules at home. On the other hand, the WTO is an institution designed to deal essentially with government actions while the main focus of he competition policy is the conduct of economic agents.
In sum, it is not likely that WTO's main weaknesses will be overcome in the near future. Nevertheless, Brazil's activity at that forum in the 1990s has shown that despite this—and particularly after the recent surge of protectionist pressures by the United States—it is in the developing countries' interest to promote the multilateral trade system. Cases such as the Embraer/Bombardier occurrence and the controversy about pharmaceutical patents have already become symbols of situations in which well-grounded negotiating strategies can preserve legitimate national interests. In addition to enhancing WTO's credibility, those cases have also proven instrumental in fomenting bilateral dialogue with several major partners, including Japan, China, India, Australia, and South Africa.
In addition to WTO's promotion, another priority of Brazil's foreign policy is the reconstruction of Mercosur, which has played a strategic role in defending Brazilian interests in the multilateral sphere, in the negotiations for the establishment of a Free Trade Area of the Americas-FTAA, and in the dialogue with the European Union. Mercosur is important for reasons of economic geography: current international competition patterns are no ephemeral anomalies; they have been formed in the course of several decades owing to the dichotomy between information costs and transportation costs that was pointed out above. This being the case, unless the current competition patterns are redefined by another technological revolution, regional integration objectives shall remain a priority for Brazil.
Foreign Relations:
Responsible for advising the President of the Republic of Brazil on the formulation and execution of Brazilian foreign policy, the Foreign Office - Itamaraty, as it is known - has three landmarks in its history. The first one was in 1750 with the signing of the Treaty of Madrid, when Alexandre de Gusmão negotiated the borders issue established by the Treaty of Tordesillas. The second was in 1808 with the transfer of the Portuguese Court from Lisbon to Rio de Janeiro as a result of Portugal being occupied by Napoleon's forces; lastly, in the years following independence in 1822, came the process of the recognition of Brazil during the monarchic period.
It was over that period, spanning almost two and a half centuries, that Brazilian diplomacy laid down its fundamental principles, with the peaceful resolution of disputes, non-intervention and then chiefly from 1945 onwards with the creation of the UN and Brazil's close yet unbiased involvement in the most important international forums. From the very beginning, the Brazilian Foreign Office was able to rely on some notable diplomats such as the Viscount of Uruguay, the Viscount of Rio Branco, the Baron of Rio Branco, Oswaldo Aranha, San Tiago Dantas and Araújo Castro.
Today, Brazilian diplomacy has updated its principles, emphasizing the process of regional integration with Mercosur and other regional and financial bodies. It has also been heavily involved in the discussion of important topics on the international agenda including issues such as the protection of human rights, ecological conservation and the maintenance of peace. At the same time, it has strengthened its links with the Community of Portuguese-Speaking Countries and has structured itself in order to meet the needs of Brazil and foreign policy in as agile a manner as possible. In this regard, Itamaraty is carrying out its activities abroad through 92 Embassies, 6 Missions attached to international organizations, 37 Consulates and 14 Vice-Consulates as well as by means of services such as trade promotion, consular duties and the spreading and communicating of Brazilian language and culture.
Internally, the Brazilian Foreign Office has been improving both its organizational structure and its diplomatic activities as well as the services provided by such areas as the Ceremonial Section. For this, it is supported by a structure that includes its headquarters, the Itamaraty Palace in Brasilia; the Itamaraty Palace in Rio de Janeiro is the former headquarters and present day offices of the Foreign Office with representation for the States of Rio Grande do Sul, São Paulo and Pernambuco as well as support organizations such as the Alexandre de Gusmão Foundation (Funag) and the Rio Branco Institute. The various activities carried on by Itamaraty include the demarcation of Brazilian borders.
Social Policies:
Since the 1980s Brazil has been going through a particularly serious period in relation to her social situation: a very large number of Brazilians are living in a state of poverty and destitution whilst inequality in terms of wealth and income has reached immorally high proportions. This poverty and inequality have their roots in the country's past but their more immediate causes can be found in the process of development based on the replacement of imports carried out by the State between the 1940s and the 1970s; in the crisis of that development pattern ; in the failed attempts at economic adjustment; and in the consequences - still incipient - of the economic restructuring process imposed by globalization.
Without any doubt, the pattern of economic growth based on protected industrialization was responsible for the upturn of an urban industrial economy that was diversified and complex, in terms of both consumption and mass, and on the edge of capitalism. This growth pattern, however, was not able to eliminate poverty and wretchedness although it had contributed towards their reduction at the most dynamic points of its cycle. Neither was it able to reduce the inequalities of wealth and income, having actually accentuated them during recent times. Certain social groups have remained permanently on the margins of its benefits, for example, the mass of rural workers without land, owners of tiny smallholdings increasingly impoverished and falling into debt as well as contingents of marginal urban workers.
The progressive weakening of this pattern of economic growth was accentuated throughout the 1980s, a period that was marked by the debt crisis, the increasing loss of economic dynamism, the mounting public debt and the consequent crisis in the State and Public Administration compounded by recurrent inflation and vicissitudes and uncertainties in relation to unsuccessful attempts to establish economic stability. The situation was made worse during that period by Brazil's social problems: there was once again an increase in the contingent of the poor and destitute, accentuating inequality and increasing the vulnerability of certain sections of the middle and lower middle classes - especially those dependent on the State and its actions.
Brazil moved into the 1990s at the same time as undergoing an economic re-structuring process leading to technical and management modernization as well as to business opportunities, causing sharper competition within the domestic market. These factors have had a profound effect and over the next few years will continue to affect other occupational and social groups, mainly those directly linked to the peripheral pattern of industrial organization. The structural modifications to the economy have had and will continue to have a negative impact on the job-product elasticity and for not inconsiderable sections of the Brazilian people, the problem of employment and the job market could be more acute in the future than it has been in the past.
The recent successful experiment in economic stabilization, represented by the Real Plan introduced in Brazil in mid 1994 marked the beginning of a decline in that trend, especially for the poorest sections of the population. However, with the ending of inflation, certain sections of the population who had been benefiting from it could start to feel more vulnerable.
These various processes are producing a complex structure that is marked by exclusions and social vulnerabilities, as shown in the table illustrating the numbers of poor people and the graph showing the rate of income growth. These issues must be tackled by a varied range of public and government policies. To achieve this, a series of schemes and actions aimed specifically at the social area are being devised and introduced, in an attempt to promote, consolidate or guarantee basic social rights and equality of opportunity, providing protection against situations of recurring risk and making social security available to vulnerable groups.
To this is added the additional challenge to the progress of the Brazilian social issue: the demographic challenge. The demographic transition that has been in progress over the last thirty years has brought about significant changes in the age structure of the population, in family behaviour and the job market.
This has caused a far-reaching overhaul of the social security system involving its expansion and improvement. The challenge involved in carrying out these transformations must respect democratic institutions and give social policies a role in the process of consolidating and strengthening democracy, within that context.
