Fastest Growing Countries is a series devoted to examining several countries with rapidly expanding economies today, or that at least have the potential to do so. By examining the historical rise of these countries and how it is happening, we can hope to better understand the variety of ways that we might be able to enliven the economies of where we live, and work towards a more sustainable and profitable future for everyone.
Brazil is a country that is at an interesting crossroad. For years, they have enjoyed an explosive growth that has made them one of the most powerful economic nations in the world. However, they are now at a crossroad, due to a recent contraction. Either Brazil has flown too close to the sun, and will now come tumbling down, or they can weather the storm and lay a groundwork to bounce back from their current woes, making them a permanent powerhouse in global economic politics. Here is some information on the current status in Brazil.
Brazil over the past decade
Over the past decade, Brazil has experienced rapid growth that was nearly unmatched by any country. From 2000 to 2012, Brazil’s GDP grew at an annual rate of 5%, which eventually led the country to overtake the United Kingdom and Russia. However, the following few years have led Brazil into the interesting dilemma we have highlighted above, as 2013 and 2014 have brought about contractions to their gigantic boom, by around 3%.
Several powerful industries
What has largely allowed Brazil to maintain the level of growth that they had was the open economy that they embraced in the 1990’s. This liberalization led to a booming private sector, which grew into the growth of several major industries. Agriculture is especially huge in Brazil, with sugar, soybeans, oranges, beef, and coffee being major exports of the country. Oil and mining of natural resources have also led to the country’s explosive rise.
Fears of unsustainability
Due to the rapid growth that Brazil was able to accomplish for so long, there were many who believed that this rapid expansion was unsustainable, in the long run. Quite honestly, there is a lot of truth to this. No country could continue to grow its GDP at the rate that Brazil’s was growing continuously. Eventually, it would begin to slow down. However, fears of many people came true when this slowdown became a harmful contraction of GDP.
The current position of Brazil is one of economic decline. For the past couple years, the economy has contracted by about 3%. However, it doesn't necessarily need to be this way. The current strength of Brazil, which made it the seventh biggest purchasing power economy in the world, was due to the strong middle class that the country was building during the 2000’s. Brazil may not be able to achieve the aggressive growth that they experienced before, nor should they strive for that. However, by focusing on policies that strengthen and maintain that strong middle class, Brazil will be able to regain its footing and achieve a strong, sustainable rate of expansion.