Brazil is one of South America’s most influential and powerful Countries, and leading its cause to become one of the world’s most influential counties. Brazil is one of the BRICS countries. BRICS refers to Brazil Russia India China and South Africa becoming economic figures due to their newly advanced economic development. Much of brazil’s increase in wealth comes down to the vast amount of natural resources in the country such as Iron ore a resource craved by many large manufacturing nations, furthering this Brazil has recently been able to capitalise on their offshore oil resources allow them to become self-sufficient for energy an area where they previously struggled and relied heavily on other nations.
Gross National Income (GNI) refers to the level of economic activity produced in a country in any one year. Since 2007 Brazils GNI per capita (per person) has nearly doubled, from $6,100 in 2007 to $11,630 in 2012 with a yearly rise around currently around 5% very much likely to continue. (data from http://data.worldbank.org/country/brazil ) This increase in both GNI and GNI per capita shows Brazils continuing success and development. Brazil currently have a GDP (Gross Domestic Product) of $2.45 trillion meaning its ranked 6th in the world charts a massive growth of a once mass poverty stricken undeveloped country (data from http://www.statisticbrain.com/countries-with-the-highest-gdp/ ). The main cause of the GNI increased levels along with its vast levels of natural resources is the increase in industry within Brazil, with the newly discovered resources allowing new sectors and new jobs to be created allowing for more employment leading to higher employment levels. Brazil has areas of mass poverty especially in the capital of Rio de Janeiro however with it’s increased level of output and increase in finance, re-invested has been able to reduce the level of poverty causing poverty headcount at national poverty to decrease from 30.8% (in 2005) to 21.4% (in 2013) once again showing brazils continuing economic and social improvement.
Brazils fiscal policy has previously been very loose allowing for high levels of government spending. Originally intended to combat the 2008 recession, however since the large boom of brazil’s economy, public spending has continued to grow, with public spending at high levels and inflation currently at 6% a full 1.5% above the target level of 4.5%, the fiscal policy has the potential to create major issues for Brazils long-term growth and sustainability. With the need to cut around 2.5% of Government spending in order to continue to have a surplus whilst re-paying loans and interest on its loans Brazil could see its decrease in unequal wealth distribution reversed and actually cause further polarisation by being unable to fund the least