Analyzing the regional alliances and economic integration that Brazil is in, it can be characterized that the country has engaged in both bilateral and multilateral agreements with states and organizations to intensify trade and economic growth. Looking back, Brazil has been part of North American Free Trade Agreement (NAFTA) in 1993, Common Market of the South (Mercosul), and has followed the standards of the Economic Commission for Latin America and the Caribbean (ECLAC) (Country Studies, 2000).
The physical environment in Brazil offers investors a wide variety of structures and industries to invest from. More than an agricultural sector, its huge land capital can offer new infrastructures that can increase markets for oil, telecommunications, and production of raw materials (Moreira, 2004). This then has resulted to the increase of FDI from among trading partners such as the United States, Canada and Western Europe. Looking at Brazil’s current political scenario, the transition of leadership creates the necessary foundations for change. It offers both the political and economic sector greater stability in the region.
It can also create new opportunities for programs aimed for development be created and practiced. However, there must be effective implementation towards social welfare policies and help alleviate high inflation and poverty (TMC News, 2006). Lastly, as far as economic conditions are concerned, it has made significant progress in increasing investments and lowering the level of unemployment. However, due to the current trends of the global economy, GDP have slowed down and resulted to a sharp increase in unemployment and poverty statistics. Likewise, there had been reforms proposed to “improve the business environment and promote more dynamic growth, such as tax reform, strengthening of regulatory agencies and (to a lesser extent) labour market reform” (TMC News, 2006, p.
1).ReferencesCountry Studies (2000) Trade Patterns and Regional Economic Integration. Retrieved April 4,2009 from, http://www.country-studies.com/brazil/trade-patterns-and-regional-economic-integration.htmlMoreira, M.M.
(2004) Brazil’s Trade Liberalization and Growth: Has it Failed? in Inter-American Development Bank. Retrieved April 4, 2009. 1-31.TMC News (2006) Brazil risk: Political Stability Risk.
Retrieved April 4, 2009 from,http://www.tmcnet.com/usubmit/2006/07/20/1722363.htm