BRAZIL ECONOMY |
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| Possessing large and well-developed agricultural, mining, manufacturing, and
service sectors, as well as a large labour pool, Brazil's economy outweighs
that of all other South American countries and is expanding its presence in
world markets. Major export products include coffee, soybeans, iron ore,
orange juice and steel. After crafting a fiscal adjustment program and
pledging progress on structural reform, Brazil received a USD 41.5 billion
IMF-led international support program in November 1998. In January 1999, the
Brazilian Central Bank announced that the Real would no longer be pegged to
the US dollar. This devaluation helped moderate the downturn in economic
growth in 1999 that investors had expressed concerns about over the summer
of 1998, and the country posted moderate GDP growth. |
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Economic growth slowed considerably in 2001 - to less than 2% - because of a
slowdown in major markets and the hiking of interest rates by the Central
Bank to combat inflationary pressures. Investor confidence was strong at
yearend 2001, in part because of the strong recovery in the trade balance.
Highly unequal income distribution remains a pressing problem.
After Luiz Inácio Lula da Silva came to power in 2003, the government has
changed economic policies. The economy is growing again, and is expected to
do so for the forseeable future. |
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