pest analysis of brazil

7/23/2019 Pest Analysis of Brazil

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PEST ANALYSIS OF BRAZIL

COUNTRY PROFILE:

Brazil, ofcially known as the Federative Republic oBrazil, is the th largest country in the world, in

terms o both population and area, and the largestcountry in the Latin merica and !outh mericaregion" #ith a population o more than $%% millionpeople, Brazil ranks seventh in the list o the largesteconomies in the world and is home to a variety onatural resources, natural environments and wildlie"

&he country su'ered a recession in $%%(" )owever,tough undamentals have led the country out o thecrisis"

Brazil*s economy is the world*s ninth+largest by

nominal -. and seventh+largest by -. /...0 as o$%12" member o the BR34! group, Brazil until $%1%had one o the world*s astest growing ma5oreconomies, with its economic reorms giving thecountry new international recognition and in6uence"Brazil*s national development bank plays animportant role or the country*s economic growth"Brazil is a ounding member o the 7nited 8ations, the$%, BR34!, 7nasul, 9ercosul, :rganization omerican !tates, :rganization o 3bero+merican!tates, 4.L. and the Latin 7nion" Brazil is a regional

power in Latin merica and a middle power ininternational a'airs, with some analysts identiying itas an emerging global power" :ne o the world*sma5or breadbaskets, Brazil has been the largestproducer o co'ee or the last 12% years"

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&he government is proactive and stable and there isno political instability in the country at the moment")owever, or how long< &his is something whichcannot be predicted, as the modern history o Brazil

indicates things can change overnight, especiallyduring elections, as the political situation tends toheat up a great deal" 4orruption still remains a bigissue in the country and it=s worsening" 3t hasescalated to the e>tent that even opening a small business /at times0 mayre?uire you to make payments to government representatives and ofcials"ccording to a survey by &ransparency 3nternational, Brazil is ranked @$nd out o1A% countries when it comes to corruption" &his is even higher than economieslike &urkey, Bulgaria and 4uba"


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ECONOMIC FACTORS:

&hanks to a large population and F-3 in6ow, Brazil=s potential or growth ise>tremely high" &here is a substantial trend o a growing middle+class and thegap between the rich and poor is declining steadily" dditionally, the 4entralBank has successully reduced the risk o currency devaluation and has alsobrought in6ation under control" )owever, when it comes to the dollar, the

currency is considered to be overvalued, which is adversely a'ecting the e>ports

o the country"

Both domestic and oreign enterprises are treated e?ually and labour costs areconsiderably low" For import duties, a system is in position, which graduallydecreases the tari' depending on the amount o successul importing years"Furthermore, the corporate ta> is set at 12 and there are no incentives orleaving prots in the country" 4ompared to other economies, such as reece and

3reland, the ta> rates are considerably high"


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SOCIAL FACTORS:

&here is economic ine?uality with the population as around $% o thepopulation lives under the poverty line" Looking at the class distribution, thereare a considerable number o wealthy citizens and a huge segment o peoplewith minimal incomes" &he middle class is growing" )owever, there is still timeor it to establish" &his tells as that there is large consumer population /1Amillion0 o ?uite rich individuals that could be successully targeted with ourproduct" Brazilian people are considered as modern and up+to date with ashionmovements in the world" &hey are aware o lu>ury brands and are willing to buye>pensive products"

!outh and southeast region are the most developed parts o the country andhold the best standard o living" &hese areas are the most+densely populated andaccount or the biggest portion o -. per head" !outheast is the home to cities

o Rio de Caneiro and !ao .aolo, where the largest part o population is located" 3naddition, Brazilians are up+to+date in the ashion world and are consideredmodern, as they are aware o big brands and are keen to buy e>pensive andlu>urious products" &he country hosted the F3F #orld 4up $%1D and a ma5orityo the population has a keen interest in ootball"


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TECHNOLOGICAL FACTORS:

4ompared to countries like the 7! and Russia, Brazil possesses a weakertechnological inrastructure, as well as investment, but there are e'orts beingmade to push the development o technology centres all over the country")owever, 3& is a sector in which Brazil has been constantly improving and itcurrently ranks 2Erd in the world"

&echnological research in Brazil is largely carried out in public universities andresearch institutes, with the ma5ority o unding or basic research coming romvarious government agencies" Brazil*s most esteemed technological hubs are the:swaldo 4ruz 3nstitute, the Butantan 3nstitute, the ir Force*s erospace

&echnical 4entre, the Brazilian gricultural Research 4orporation and the 38."&he Brazilian !pace gency has the most advanced space program in Latinmerica"

7ranium is enriched at the Resende 8uclear Fuel Factory, mostly or researchpurposes /as Brazil obtains AA rom its electricity rom hydroelectricity0 and the


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country*s rst nuclear submarine will be delivered in $%12 /by France0" Brazil isone o the three countries in Latin merica with an operational !ynchrotronLaboratory, a research acility on physics, chemistry, material science and liesciences" nd Brazil is the only Latin merican country to have a semiconductorcompany with its own abrication plant, the 43&4"

LEGAL FACTORS:

Brazilian law is based on Roman+ermanic traditions and civil law conceptsprevail over common law practice" 9ost o Brazilian law is codied, although non+codied statutes also represent a substantial part, playing a complementary role"4ourt decisions set out interpretive guidelinesG however, they are seldom bindingon other specic cases" -octrinal works and the works o academic 5urists havestrong in6uence in law creation and in law cases"

!upreme Federal 4ourt o Brazil serves primarily as the 4onstitutional 4ourt othe country"

&he legal system is based on the Federal 4onstitution, which was promulgatedon 2 :ctober 1(AA, and is the undamental law o Brazil" ll other legislation and

court decisions must conorm to its rules" s o pril $%12, there have been 2Eamendments" !tates have their own constitutions, which must not contradict the


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Federal 4onstitution" 9unicipalities and the Federal -istrict have Horganic lawsH/leis orgInicas0, which act in a similar way to constitutions" Legislative entitiesare the main source o statutes, although in certain matters 5udiciary ande>ecutive bodies may enact legal norms" Curisdiction is administered by the

5udiciary entities, although in rare situations the Federal 4onstitution allows the

Federal !enate to pass on legal 5udgments" &here are also specialized military,labor, and electoral courts" &he highest court is the !upreme Federal 4ourt"

&his system has been criticized over the last ew decades or the slow pace odecision+making" Lawsuits on appeal may take several years to resolve, and insome cases more than a decade elapses beore denitive rulings" 8evertheless,the !upreme Federal &ribunal was the rst court in the world to transmit itssessions on television, and also via Jou&ube" 9ore recently, in -ecember $%%(,the !upreme 4ourt adopted &witter to display items on the day planner o theministers, to inorm the daily actions o the 4ourt and the most importantdecisions made by them"

ENVIRONMENTAL FACTORS:

s a developing or newly industrialized nation, Brazil is notable or taking a leadin environmentally riendly initiatives" 3n the eld o biouels, Brazil is the second+largest producer o ethanol in the world" 3t is also home to two sustainable cities"8evertheless, environmental issues remain a ma5or concern in Brazil"-eorestation in Brazil is a ma5or issueG the country once had the highest rate odeorestation in the world" By ar the most deorestation comes rom cattleranchers that clear rainorest /sometimes illegally, sometimes legally0, so as tomake room or sowing grass and giving their cattle the ability to graze on thislocation" n important route taken by cattle ranchers and their cattle is the

&rans+mazonian )ighway" -eorestation has been a signicant source opollution, biodiversity loss, and greenhouse gas emissions worldwide, butdeorestation has been Brazil=s oremost cause o environmental and ecologicaldegradation" !ince 1(@%, over K%%,%%% s?uare kilometres o mazonianrainorest have been destroyed and the level o deorestation in the protectedzones o Brazil*s mazon rainorest increased by over 1$@ percent between $%%%and $%1%" Recently, urther destruction o the mazon Rainorest has beenpromoted by an increased global demand or wood and soybeans"

:ther environmental issues in Brazil include illegal wildlie trade, illegal

poaching, air and water pollution, land degradation and water pollution causedby mining activities, wetland degradation and severe oil spills, among others" sthe home to appro>imately 1E o all known species, Brazil has one o the mostdiverse collections o 6ora and auna on the planet" 3mpacts rom agriculture andindustrialization in the country threaten this biodiversity"

pest analysis of brazil

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