I may be wrong, but I see a wave of economic opportunity on the horizon for South America's largest country.
The Brazilian economy has been through a lot of ups and downs over the past 16 years. Mostly downs. Former President and current inmate Luiz Inácio Lula da Silva was credited by many with pulling millions of Brazilians out of poverty, but it turns out that he gave them credit cards with a 45% interest rate instead. Gee, obrigado.
Despite all the occasional “miracles” that have been declared about Brazil’s economy, the annual growth rate in gross domestic product over the last 20 years has averaged a paltry 2.3%. Recent results skew much worse.
Today’s Brazil is a sick patient, having suffered from not only negative growth, but high unemployment, losses of entire industries, continued high duties and taxes, and a level of violence that compares unfavorably to some war-ravaged countries in the Middle East.
So why the optimism?
Two words: “economic liberalism.”
Economically free countries enjoy high standards of living without much central planning or government interference. Countries like Hong Kong, Singapore, Switzerland…and to a lesser extent the US and Canada, are extremely productive and have a high per capita GDP. Life expectancy in economically free countries is significantly higher than in economically restrictive countries. Political and civil liberties are higher as well. Did you know that the income of the poorest 10 percent of the population in the most economically free countries is eight times greater than the income of the poorest 10 percent in the least economically free countries? A rising tide lifts all boats.