Global Business Perspectives

Why do business in Brazil? 

Largest economy in South America, Fifth largest country in land mass and population.  Brazil is one of the fastest growing economies – could rival the economy of the U.S.  However, Brazil is still a developing country with bureaucracy, issues with infrastructure and taxes on imports. 

1.  Understand the Brazilian Culture

• The Brazilian population consists of African, Portuguese and native peoples. 
• The national language is Portuguese and Brazil is the only South American country that does not speak Spanish.  However, when I spent time there, the people often can understand my Spanish and we are able to communicate. 
• Brazilians are very flexible people who often times think outside of the box and like to  bend the rules. 
• They are also a bit less formal than here in the U.S.  Conversation and relationships are very important to them and time is a bit looser as they are often 20 minutes or so late to appointments. 

2.  Issues in Brazilian Logistics and Transportation

• Most of the population is on the East Coast of Brazil due to much of the country covered by the Amazon.
• Unregulated trucking is number one mode of transportation, water and rail is far underused.
• The recent privatization of the rail system provides opportunities 

3.  Issues facing Brazil

• Only 20 years ago Brazil was ruled by a military dictatorship. 
• Currently is rules by Brazil’s liberal and socialist President Lulu who has bought strong economic recovery, improved education, introduced investment programs and has reformed corruption.
• There is still much work to do in all of these areas. 
• Lastly, the disparity between the rich and poor is a problem the government is struggling to fix. 

4.  Costs to keep in mind when doing business in Brazil

• Consider the influence of the very powerful Brazilian labor unions to have a successful business. 
• Minimum wage (as of 2005) is around R$300 monthly and they get 30 days vacation, health insurance and meal tickets/bus passes. 
• Brazil has one of the most complicated tax systems in the world.  Brazil is working on a simpler tax system to make their country more competitive. 

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