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Aiko, Soya, Matsuo 1
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The Economy of Brazil
Hidemi Aiko1506213
Takumi Soya1506256
Yumi Matsuo1506301
Soka University
Faculty of Economics
International Program
Economics Lecture B Advanced B
Raymond Yasudas
January 17th
Aiko, Soya, Matsuo 2
The Economy of Brazil
Part 1: Economic Indicators
[You need an introduction to this section.]
Gross Domestic Product (GDP) by ______
1960196319661969197219751978198119841987199019931996199920022005200820112014
0
500000000000
1000000000000
1500000000000
2000000000000
2500000000000
3000000000000
Nominal GDP Real GDP
Year
Figure 1-a. Nominal (current US$) and Real (constant US$ in 2010) GDP. From “The World Bank” 2016. Retrieved on October 3, 2016 from http://data.worldbank.org/indicator/NY.GDP.MKTP.CD?locations=BR
Figure 1-a shows the Nominal and Real GDP of Brazil from 1960 to 2015. GDP
(Gross Domestic Product) indicates that the total economic value of final goods and services
which is produced in a year. The Nominal GDP indicates the total economic value in one year
with by using the price of in that year. On the other hand, the real GDP indicates only the
output in one year with using the base year price. It eliminates the influence of inflation. In
the calculation for real GDP in 2010, the current US$ rate was used in 2010 is used by the
Aiko, Soya, Matsuo 3
real GDP calculation, so the both types of GDP make the interaction point intersected in
2010. Both of the trends of nominal GDP and real GDP kept increasing during the period
[Exactly which period are you referring to?]. Before 2010, the nominal GDP is was below the
real GDP, and this meant that the price level is was higher in 2010 before than in previous
years. The higher price is was caused by strong inflation in Brazil.
To see the Nominal GDP, it rose rapidly from 2002, and it exhibited a became
steeper increasing. The Inflation had kept [Kept what?] since from 2002, then the price level
caught catch up to the GDP in 2010. From 2013 to 2015, the nominal GDP is declined, and it
means that the price level was went going down, which we call the deflation.
To see the Real GDP, it shows constant increasing increase during the period
[During what period?]. in the long term see. [What does this mean?] This means that the
quantity of output of Brazil kept increasing, and the economy was going expansion
expanding. However, from 2013, nowadays, the real GDP has been declining is decline from
2013, because the economy is contracting.1960196219641966196819701972197419761978198019821984198619881990199219941996199820002002200420062008201020122014
-10
-5
0
5
10
15
20
Year
Ann
ual %
Aiko, Soya, Matsuo 4
Figure 1-b. GDP growth rate (annual %). From “The World Bank” 2016. Retrieved on October 3, 2016 from http://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?locations=BR
Figure 1-b shows the real GDP growth rate of Brazil from 1960 to 2015. The GDP
growth rate indicates the change in the real GDP (base is 2010 US$) from the previous year
and its positive or negative indicates growth or contraction of GDP. The graph shows Brazil's
economy expanding or and contracting and as it fluctuated between -4.39 % and 13.98 %
during this period. The fluctuation trend is no the fluctuation is less volatile from 1994 than
before in years prior to 1994, and almost years of rate are expanding [What does this mean?].
From 2012 until now, the GDP growth rate has been contracting Then it is contraction from
2012, nowadays.
There are two main trends in the GDP growth rate. One is from a higher growth rate
in the 1960s and 70s higher growth, and the other is from 1980 the beginning of a shrinking
growth rate began to shrink from 1980. Firstly, the economy continued to be produce a high
growth between 1964 and 1972. The Household consumption was approximately between 67
% and 72 % of GDP during the1960s, so the with consumption continuing continued to rise
constantly (World Bank, 2016) [This citation is not in the reference list. Add this reference to
the list.]. Then [When is "then"?], other parts of GDP started to grow was growing, especially
investment. Capital investment's, percent of GDP was rapidly rising that it changed 16.9 %
changing from 16.9% in1968 into 26.8 % in 1976 (The global economy, 2016) [This citation
is not in the reference list. Add this reference to the list.]. The large scale of capital
investment in infrastructure and industry helped to establish new industries more and more.
[Give a specific example of this.] People called this situation “Brazil miracle.”. [The period
comes before the closing quotation mark.] Raising Rising investment impacted the higher
economic growth in the latter half of the 1960s and in the 1970s. The turning point was the
Aiko, Soya, Matsuo 5
lowest point in 1980. In 1980, Brazil experienced its the lowest growth rate is at minus – 4.39
%, and the economy was contracting because of failed policies of policy and high inflation at
that time, Secondly, from 1980, the growth rate improved peaking at 7.95 in 1984 and 1985
but plummeted to is peak [To peak is to reach a very high point. You cannot peak downward.]
to –3.10 % in 1989. This drastic drop, and it was connected to the failure of the policy for
stabilization by policy from 1986 to 1989. This period is explained in more detail in Part 2 of
this paper.
Unemployment by _______________
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
0
2
4
6
8
10
12
14
16
Year
% o
f tot
al la
bor
forc
e
Figure 2. Unemployment rate (total % of labor force). From “OECD” 2016. Retrieved on October 14, 2016 from http://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?locations=BR
Figure 2 shows the unemployment rate of Brazil from 1981 to 2014. The
Aiko, Soya, Matsuo 6
unemployment rate shows the number of unemployed people as a percentage of the labor
force. People include in the unemployment rate are people who have no job, who are looking
for a job, and who are ready to work immediately if a job is available. In genial [Check your
vocabulary. The word is "general" not "genial." Genial means "friendly and cheerful."], the
unemployment is a lagging indicator of economy. The rate is changed changes little after
economic changing change, expansion or contraction. The reason why it is lagging is that
firms do not change the number of their employers employees immediately to adjust to the a
volatile economy. The Labor cost in firms is so difficult to adjust immediately to match
companies’ economic conditions. The Unemployment has fluctuated fluctuation is between
4.85 % in 2014 and [Why are you going backwards?] 14.11 % in 1981 and 4.85 % in 2014.
There are four main trends of Brazil's unemployment rate were four. They are
connected to economy expansion or contraction which was showed is shown by GDP growth
rate. Firstly, the unemployment rate was going down with changing about decreased from 12
% into 6 % between 1984 and 1986. This was the lagging of economic expansion from 1978
to 1980. [Explain this point a little more. What happened in between 1978 and 1980?]
Secondly, from 1989 to 1992, the unemployment rate was rising rose because of economic
contraction continuing from 1985 to 1989, and this period is explained in greater detail in
explanation is in Part 2 of this paper. Thirdly, from 1995 to 1999, the unemployment rate rose
from 8.29 % to 13.49 %. [Briefly explain why this happened.] Finally, from 2000, the has
been going trends became downward. For the job market in the last decade, more the female
labor force has become became stronger. In 1993, 31.8 % of employed people is women in
1993, and it in 2003, the percentage increased to 36.6 % in 2003. The more women who
participated in the job market, the lower less the unemployment rate was.
Inflation by _______________
Aiko, Soya, Matsuo 7
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
0
500
1000
1500
2000
2500
3000
3500
Year
Perc
enta
ge
Figure 3-a. Inflation, consumer prices (annual %). From “The World Bank” 2016. Retrieved on October 14, 2016 from http://data.worldbank.org/indicator/FP.CPI.TOTL.ZG?locations=BR
Figure 3-a shows the annual % percentage of inflation rate of Brazil from 1981 to
2015. The inflation rate indicates that the rate at which the general level of prices for goods
and services is rising. The fluctuation of the inflation rate is between 3.19 % in 1998 and
2947.73 % in 1990. The trend is strange because Brazil has faced the hyperinflation from
1987, and the highest peak of the inflation rate is 2947.73 % in 1990. There are two main
points on Figure 3-a of the inflation graph are two. One is the peak of hyperinflation in 1990,
and the other is the end of hyperinflation in 1995. For the first point in 1990, [Give a brief
explanation of this point.] A detailed the explanation is provided in Part 2 of this paper.
[Explain the second point.]
Aiko, Soya, Matsuo 8
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
0
2
4
6
8
10
12
14
16
Year
Perc
enta
ge
Figure 3-b. Inflation, consumer prices (annual %). From “The World Bank” 2016. Retrieved on October 14, 2016 from http://data.worldbank.org/indicator/FP.CPI.TOTL.ZG?locations=BR
Figure 3-a 3-b shows the annual % of inflation rate of Brazil. The term is after
shrinking hyperinflation from 1998 to 2015 after the period of shrinking hyperinflation. The
fluctuation of the inflation rate is between 3.19 % in 1998 and 14.71% in 2003. The trends
key point of this figure is the peak of the inflation rate in 2003, and it is at 14.71 % because
the new president of Brazil, Lula da Silva, promised that the tight to tighten fiscal and
monetary policies. The reaction of investors who invest in to Brazil was changing a restored
investors' confidence in Brazil, and they felt that the government [I think this is what you
mean. Please confirm.] should allow interest rates to fall further. In a feisty defence [Check
your spelling.] of his record, the central bank's governor, pointed out that recovery began last
July, and that growth reached an annual rate of 6% in the final quarter. Most economists still
Aiko, Soya, Matsuo 9
expect growth of 3-4% this year [When is "this year"? 2016? If this is in a past year, you need
to use the past tense of the verb expect --> expected.], spreading out ranging from booming
exports to domestic consumption and investment. Household consumption fell a record 3.3%
in 2003, while interest payments on the public debt snaffled comprised almost 10% of GDP.
[Explain why this happened.] The GDP growth rate is was down from 3.09 % in 2002 to 1.14
% in 2003. [Explain why.] After [After when or what?], the rate dropped to 6.59 % at once.
[Explain why.]
Major Interest Rates by _______________
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
0
2000
4000
6000
8000
10000
Chart Title
year
%
Figure4-a. Deposit interest rate. From “The World Bank” 2016. Retrieved on October3, 2016 from http://data.worldbank.org/indicator/FR.INR.DPST?locations=BR
Aiko, Soya, Matsuo 10
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
05
1015
2025
30Chart Title
year
Ann
ual(%
)
Figure4-b. Deposit interest rate. From “The World Bank” 2016. Retrieved on October3, 2016 from http://data.worldbank.org/indicator/FR.INR.DPST?locations=BR
Figures 4-a and 4-b shows the deposit interest rate of Brazil from 1985 to 2015. The
deposit interest rate indicates the amount of money paid out in interest by a bank or financial
institution on cash deposits. Banks pay deposit rates on savings and other investment
accounts. For example, a deposit interest rate will often be paid for cash deposited into
savings and Money Market accounts. Saving accounts earn a rather low rate of interest, but
cash deposited in certain other accounts types are also paid a deposit rate by banks and
financial institutions. [Explain why Figure 4-a shows a flat deposit interest rate from 1995 to
2016 while Figure 4-b shows a highly fluctuating deposit interest rate from 1996 to 2015.]
[State how many key points is shown in Figure 4-a and explain each of the key
points.] According to Figure 4-a, from 1985 to 1988, the deposit interest rate of Brazil
fluctuated between 295% and 860%. [Explain why.] However, from 1988 it jumped to about
5,800% and from 1989 the deposit interest rate jumped to about 9,394%. [Explain why.]
After that, in 1991, the deposit interest rate suddenly decreased to 913%. [Explain why.]
From 1992 the deposit interest rate again increased to 1,560% and in 1994 jumped to 5,175%.
Aiko, Soya, Matsuo 11
[Explain why.] Also, from 1995 the deposit interest rate went down to 52%. [Explain why.]
[State how many key points is shown in Figure 4-b and explain each of the key
points.] After that from 1996 to 1999, the deposit interest rate fluctuated between 26% to and
28%. [Explain why.] Furthermore, from 2000 to 2005, the deposit interest rate fluctuated
between 15 to and 21%. [Explain why.]After that from 2006 to 2016, it fluctuated between
7% to and 13%. [Explain why.]
From 2000 to 2003, the deposit interest rate increased 4%. In 1997, the crisis of
money happened in Asia and in Russia. After that, Brazil also experienced crisis of money
because the effect of Asia and Russia is very big, so that is the very huge effect for the market
of Brazil’s capital and money. In addition, a lot id foreign capital became outflow from
Brazil, so the value of real dawn. So, in November 1998, IMF and America decided to give
the 415billion to Brazil, but in January 6, Brazil did moratorium. So foreign investor escaped
their capital from Brazil, and Brazil declined the value of real and desired to change fixed
exchange rate to floating exchange rate. From 1999, the central bank of Brazil, BCB adopted
the system of inflation target. That policy is when inflation increase, the central bank increase
the interest rate. By doing that, inflation can be decreased because the deposit rate increasing.
That means people can earn from interest rate with increasing deposited money. So people
deposit their money into the bank and the flow of money can be stopped. So the Real
depreciation means the deposit rate increase. In addition in 2002, the Lula, Brazilian
politician who was decided to become the president. In that time the foreign investor started
sell of real because of anxiety of government of Lula. So the exchange rate was declined and
then the interest rate increased. That happened was called “Lula shocked”. But from 2003 to
2010, the deposit rate declined 13percent. That period was the period of government of Lula.
In that time, the Brazil’s export increased and current account became surplus. So investment
for Brazil increased and increased inflow of foreign capital. That means value of Brazil
Aiko, Soya, Matsuo 12
increased and the deposit interest rate decreased. [Include this information in the explanation
of the key points.]
[Provide a summary of this subsection.]
Government Public Finance by _______________
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
0
200,000,000,000
400,000,000,000
600,000,000,000
800,000,000,000
1,000,000,000,000
1,200,000,000,000
defcit expenditure revenue
US
dolla
r
Figure 5. Government public finance (US$). From “ODA”. Retrieved on October, 5 from https://www.quandl.com/data/ODA/BRA_GGR_NGDP-Brazil-General-Government-Revenue-of-GDP
Figure 5 shows the public finance of Brazil from 1985 to 2015. Public Finance is the
term, which has traditionally been used or applied to the packages of those policy problems,
which involve the use of tax and expenditure measures. As a subject, public finance is a study
of public sector economics. It is about the revenue, expenditure and debt operations of the
government and the impact of these measures on to the society. Public Finance is, therefore,
about fiscal institutions:, that is the tax systems, expenditure programs, and budget
Aiko, Soya, Matsuo 13
procedures, stabilization instruments, debt issues, level of government and etc.
From 1986 to 1993 the government expenditure is relatively high. From 1996 to
2013, the government revenue and expenditure are similar trend. From 2014, the government
revenue suddenly decreased and expenditure increased so expenditure become large than
ever. [State how many main points are shown in this figure.]
[Discuss each of the main points shown in Figure 5. State the point. Explain the
point in detail. Each main point should be discussed in separate paragraphs.]
From 2003 to 2011, Lula, Brazilian politician who served as president of Brazil. In
that time, both of government expenditure and government revenue increased. Government
expenditure increased about 7800 billion. The president of Lula increased social spending on
education, health care, and other programs for more than 11 million households living in
poverty. In addition, that period, also revenue increased about 7000 billion. Term as president
Lula chose fast disinflation as one of the main priority its economic policy. This choice
required the adoption of high real interest rate, which also demanded an increase in the
government’s primary surplus. Consequently, investment in social safety net (the
administration’s other main priority) was financed by the increase in tax revenues. In addition
from 2011 to 2015, the government deficit gradually increased. In 2011, the president became
Dilma Vana Rouseff. She did expansion of financial management of Livelihood assistance
system of “Bolsa familia” but it contributed to expansion of government deficit. In addition,
Petrobras scandal happened. Which involves over $2.1 billion in government kickbacks and
bribes. The Brazilian state-owned oil company accounts for 10% of the Brazilian economy.
Since the scandal has unfolded, Brazil’s debt has been downgraded. The government deficit
rose. The full extent of the scandal’s aftermath and impact on the economy remained. The
state of Petrobras is a far cry from what it was in the past decade. In 2007, the oil giant was
considered among the top ten largest companies in the world, value at $200 billion but
Aiko, Soya, Matsuo 14
Petrobras is now valued at $56 billion. So the government debt increased.
Exchange Rate by _______________
1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 20150
0.5
1
1.5
2
2.5
3
3.5
year
Cru
zeiro
and
Rea
l per
US
$
Figure 6-a. Exchange rate (real and Crozeiro and Real per US$ ) from1970 to 2009. From exchange rates by Quandl. Retrieved from https://www.quandl.com/data/UIFS/FX_BRA-Exchange-Rates-Brazil
Figure 6-a shows the exchange rate of Brazil Real per dollar from 1970 to 2009.
Exchange rate means the price of a nation’s currency in terms of another currency. An
exchange rate has two components, the domestic currency and a foreign currency. In the case
of Brazil, the government changed currency eight times by resolving in attempts to resolve its
hyperinflation, so the currency's denominations changed each time was held on every time. It
is difficult to compare with every each currency with the others because the value of each
currency is different from each other. The chart Figure 6-a shows only the trends of the
exchange rate of Brazil's two main currencies: the Cruzeiro’s trend (1970-1985) and Real’s
trend (1995-present).
Aiko, Soya, Matsuo 15
[State how many main points are shown in Figure 6-a. State and explain each main
point.]
1968 1970 1972 1974 1976 1978 1980 1982 1984 19860
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
year
Cru
zeiro
per
US
Dol
lar
Figure 6-b. Exchange rate (Cruzeiro per US dollar). From 1970 to 1984. From exchange rates by Quandl. Retrieved from https://www.quandl.com/data/UIFS/FX_BRA-Exchange-Rates-Brazil
The Figure 6-b shows only the trend in the exchange rate of the Cruzeiro and US
dollar. Before entering the hyperinflation, Brazil used a currency called the Cruzeiro.
[Explain what the Cruzeiro is.] [State how many main points are shown in Figure 6-b.]
Especially, the oil shock of 1979 and the Mexico currency crisis connected with influenced
the fluctuation of the exchange rate.
First of all, when an oil shock was occurred in 1979, the event hits it hurt the
Brazilian economy because the country relied on the its oil exports by exporting. [Explain
how the oil shock happened. Then, explain it effect on Brazil.] By the effect of lack of low
material, the domestic industries became deft, so brazil’s economy also became week. [What
Aiko, Soya, Matsuo 16
does this mean? "Low material" do you mean "raw materials"? What do you mean by "deft"?
"Deft" means "skillful." By "Brazil's economy also became week" do you mean "weak"?
Check your spelling! Explain each point. What you do mean by lack of raw material? Explain
what happened to the domestic industries. Explain how the Brazilian economy became
weak.] Thus, from 1979, Cruzeiro’s value decreased [from what to what?]. [You need to
support your general statements with details - explanation and facts.]
Furthermore, [State the point. State: Brazil's exchange rate was greatly affected by
Mexico's currency crisis. Then, explain how Mexico's currency crisis affect Brazil's exchange
rate. The pattern is STATE then EXPLAIN.] In 1982, Mexico declared default. The
determination gave Brazil impact because Mexico is one of the South American countries,
and it accomplished high economic growth along with Brazil in 1960s. In 1982, Mexico
declared default. The cause of Mexico's default was that the US increased its interest rate
from ___ to ____[Give the exact rates.]. Mexico had borrowed money from the US, so with
the increased by the high interest rate, it was difficult for Mexico to repay the money to the
US; therefore, it declared default. [Exactly how much did Mexico borrow? With the increased
interest rate how much did it have to pay back after the interest rate hike?] However, Brazil,
and other South American countries faced to the same situation like Mexico. Thus, all over
the world people noticed South American countries faced a were in severe problem. [I don't
understand how Mexico's default weakened Brazil's exchange rate. Explain exactly how
Mexico's default affected Brazil's currency and its exchange rate. Exactly how did Mexico's
default weaken Brazil's currency and affect its exchange rate? Explain.] By the In short,
because of Mexico’s currency crisis, Brazil’s currency become [Use the past tense of this
verb.] week [Oh, come on! Check your spelling! What is the difference between "week" and
"weak"? 「私は太が好きです。」Does this make sense to you? Why not? Because the
Chinese character for "dog" is wrong, right? It is the same thing with "week" and "weak."].
Aiko, Soya, Matsuo 17
1995 2000 2005 2010 2015 20200
0.5
1
1.5
2
2.5
3
3.5
4
year
dolla
r per
Rea
l
Figure 6-c. Exchange rate (Real per US dollar). From 1996 to 2015. From exchange rates by Quandl. Retrieved from https://www.quandl.com/data/UIFS/FX_BRA-Exchange-Rates-Brazil
The Figure 6-c shows only the change of the Real and US dollar from 1995 to 2015.
The exchange rate seems is not constant because of external factors in early 2000s, the
change of oil prices in 2014 and the cost of preparing for the Olympics from 2010 to
______[To when?].
Firstly, the chart explain the exchange rate was affected by external factors in early
2000s. Figure 6- shows that the exchange rate became higher in 2001 and 2002 because of
vote election of a new president, Luiz Inácio "Lula" da Silva. From 1995 to 2002, Fernando
Henrique Cardoso, the presidents was the president of Brazil from 1995 to 2002 and was
popular in both domestically and overseas. However, when the time came to elect a new
change the president came, Luiz Inácio "Lula" da Silva, the a leftism politician, entered the
Aiko, Soya, Matsuo 18
race election. A lot of foreign investors felt anxious by his da Silva made many extreme
remarks during his election campaign, which made a lot of foreign investors anxious about
Brazil's future economic development, so the Real became week in 2001 and 2002. In the
vote, Luiz Inácio "Lula" da Silva won and assumed the presidency in 2003. Thus, the week
Real came to peak at 3.7 Real to 1USD, 1dollar=3.7 real in the period between ____ and
_____[Give the exact years that this occurred.].
Secondly, [State the main point first.] From 2014 to 2015, the value of the Real real
[What is the difference between "real" and "Real"? "Real" is Brazil's currency. "real" means
"actual, genuine or true." This is a big difference!] was down immediately. It was influenced
with dropped greatly because of the decreasing oil prices. [What was the price of oil before
2014? How much did it decrease in 2014 and then in 2015? Give specific statistics.] The
price has decreased since 2014. By the effect of Decreasing oil prices increased the, value of
the US dollar become higher. A higher US dollar results in a lower Brazilian Real. Brazil is
one of the largest strongest oil exporters in the world, so low oil prices and a strong US dollar
reduced the revenue Brazil receives from oil sales, and this hit the Brazilian economy.
[Exactly how did this "hit" the Brazilian economy?] Thus, the value of the Real depreciated
from _____ to ________depreciation has occurred.
The third factor influencing the fluctuation of the Real's exchange rate is the cost of
preparing for the 2016 Rio summer Olympics. [State the point and then explain!!!]
Furthermore, During the period of 2010 to 2015, Brazil spent the money a large sum to
building Olympic stadiums, and facilities and infrastructure. [Exactly how much did Brazil
spend? Be specific! How much did they spend in total? How much did they spend for
stadiums? How much did they spend for facilities? How much did they spend for improving
their infrastructure? How did all of this spending influence the value of Brazil's currency and
its exchange rate?] That’s why week Real was unfavorable conditions because the country
Aiko, Soya, Matsuo 19
had to import many product to make them. [Revise this to better match your explanation of
the costs of preparing for the Olympics, its influence on the Real and how the decreased
value of the Real increased the cost of the preparation for the Olympics.]
Balance of Trade by _______________
Figure 7. Balance of trade in export and import in Brazil from 1960 to 2015. From “export and import” by world bank(n,d). Retrieved from http://www.worldbank.org/
Figure 7 shows the balance of trade in export and import of Brazil from 1960 to
2015. Trade balance indicates how much the country imports and exports each year.
Furthermore, the chart figure illustrates explain the gap between exports and imports.
Especially, the chart donates Three major events have especially influenced the balance of
trade: influence of trade liberalization in 1995, discovery of new oilfields in 2000s [This does
not match your explanation. In your explanation, Brazil continuously discovered oil fields in
1950 1960 1970 1980 1990 2000 2010 20200
50000000000
100000000000
150000000000
200000000000
250000000000
300000000000
350000000000
400000000000
import export
Aiko, Soya, Matsuo 20
the 1990s and a large one in 2008. Change this date to match your explanation.], and the
expenditures for the 2016 Rio of Olympics.
First of all, one major event in Brazil's balance of trade is the government enacted
enacting trade liberalization in 1995. Before 1995, the country had acted the policy of import
substitution industrialization, so it imposed duties on for foreign exporting goods to protect
domestic products. However, by the changing policy, cheaper and better-made foreign cheap
and high skillful commodities came to entered the Brazilian market. [What happened with
these commodities entered the market? How did people respond to these commodities?]
Thus, imports have generally exceeded exports from 1990.
A second major event in Brazil's balance of trade is the discovery of new oil fields
in the ____________. Secondly, development of drilling the oil skill contributed Brazil’s
trade from 2000s. [Is it that Brazil discovered new oil fields or is it that Brazil's skill in
drilling for oil contributed to its trade? It is not clear what you mean.] In 1953, the Brazilian
built government enterprise of digging oil called established Petrobras, an oil-drilling
enterprise in 1953. The government used Petrobas the power to discover oil, but it was not
successful in finding oil could not find until the late 1980s. [What did they find? How much
oil could they extract or produce?] Nevertheless In the 1990s, the company continuously
succeeded in detecting to detect oilfields continuously in 1990s, and in 2008, the largest oil
field was found. [How big was the oilfield? How much oil could they extract? How much
more oil could Brazil export with this oilfield find?] Although overall exports decreased
because of the influence of the US subprime mortgage crisis, as a result of this large oilfield
find, Brazil's the exports recovered and increased rapidly by thank to oil development, and its
balance of trade was able to recover. In addition, Brazil joined tied Mercosur which is duty
alliance composed of the South American countries in1995. In 2000s, not only South
American companies, but also other area’s countries enter the alliance such as India, and
Aiko, Soya, Matsuo 21
South African countries. Thus, from 2000 both export and import jumped up immediately.
[How is this related to the 2008 finding of a new and large oilfield? If there is no connection,
delete this information.]
Finally, a third major event in Brazil's balance of trade is the increase of imports of
raw materials necessary to prepare for the 2016 Rio Olympics. Because of this preparation,
recently imports have become lager than exports because of Olympic. By preparing to hold
the on Olympics in 2016, Brazil has had to build built many stadiums and facilities and
improve its infrastructure. These projects require low [Really? Low? I think you mean "raw."]
material that are was imported from foreign countries. [Give specific details of what exactly
Brazil had to import and the amount that Brazil import. Then, give details on Brazils overall
imports and the amount that they imported.]
Table 1.
Brazil's Export Goods
1970 1985 1995 2005 2011No1 Coffee 34.6 Coffee 9.2 Iron ore 5.5 Iron ore 6.2 Iron ore
16.3No2 Iron ore 7.7 Iron ore 6.5 Beans 4.4 Beans 4.5 Oil 8.4No3 Cotton 5.7 Oil product
6.3Coffee 4.2 Oil product
4.1Beans 6.4
No4 Beans 8 Beans 4.7 Sugar 3.1 Automobile 3.7
Sugar 4.5
No5 Fruit 5.6 Fruit 3.1 Wood 3.1 Oil 3.5 Oil product 3.7
Figure 7-a. brazil’s exporting goods. From 1975 to 2011. Mexico and Brazil’s strategy byTsusho hakusho. Retrieved fromhttp://www.meti.go.jp/report/tsuhaku2014/2014honbun_p/pdf/2014_02-02-03.pdf
Aiko, Soya, Matsuo 22
The figure 7-a Table 1 shows what kind of products Brazil exported. This illustrates
change of exporting products. Before liberalization in 1995, the main exporting goods were
primary products such as coffee beans, and sugar. However, from 1995, Brazil exported
primary products plus resource like iron ore, and processed goods. Recently, exports of oil
and industrial products become strong have increased because of the finding new oilfields
and high economic growth. [Explain how this compares with the amount of what Brazil
imports and how it has affected the balance of trade.].
[You need a summary paragraph for this subsection.]
[You need a concluding paragraph for this section of the paper.]
Aiko, Soya, Matsuo 23
Reference [Center this heading.]
[In the reference list, include ONLY those sources which you have cited in the paper. If you
cite a source in the paper, it MUST be listed in the reference list. The reference list MUST be
organized alphabetically.]
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Exchange rate. [Use the title of the article if there is no author, not the web page name.]
Investopedia (2016). Exchange rate. Retrieved from
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Aiko, Soya, Matsuo 24
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Where is the citation for the following sources cited in the paper?
World Bank, 2016 on page 4 of this paper?
The global economy, 2016 on page 4 of this paper?
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