A New Contender in the Global Economy? Throughout the latest research, newspaper or political science journal articles Brazil has been termed “an upcoming global power” or “international player”. This being seen specifically in Brazils global economic position. Brazil is the largest national economy in Latin America, the worlds seventh largest economy at market exchange rates and the seventh largest purchasing power parity, according to the international Monetarty Fund and the world bank.
Brazil has a mixed economy with abundant natural resources. Brazil is rapidly becoming a large contender in the Global economy partly due to being one of the 17 mega diverse countries in the world, home to a variety of wildlife, natural environment and extensive natural resources in a variety of protected habitats. O’Neil sees Brazil as a powerhouse “because of its economic strength, its hemispheric leadership and its growing strategic role through multilateral international forums” (O’Neil 2010). The economy of Brazil is the worlds seventh largest by nominal GDP.
Brazils economy is the largest in Latin American nations and comes in second best in the western hemisphere. With an average annual GDP growth rate over over 5 percent, Brazil comes in as one of the fastest- growing major economies in the world. In Brazilian real’s, Its GDP was estimated at R$4. 403 trillion in 2013. The Brazilian economy is predicted to become one of the five largest economies in the world in the decades to come. This is due to many factors including brazils involvement in a number of diverse economic organizations such as the mercosur, Unasul, G8+5, G20, WTO and the Cairns group.
Its trade partner’s number in the hundreds, with 60 percent of exports mostly of manufactures or semi manufactures goods. Brazils main trade partners in 2008 were: Mercosul and Latin America (25. 9 percent of trade), EU (23. 4 percent), Asia (18. 9 percent), the United States (14. 0 percent), and the others (17. 8 percent). “Brazils economy has yet again become an object of fascination and speculation for international investors, academics, pundits and policymakers in the United States and Europe.
As a country replete with natural resources, endowed with a large internal market and home to dynamic and increasingly global corporations, Brazil has been famously anoints as a ‘BRIS’- thus identified along with Russia, India and China as one of the four very large, rapidly emerging economies that are key growth engines of the global economy. ” (Brainard 2009) Brazil is the largest economy of Latin America and its trade with the EU accounts for 37% of the EU’s total trade with the Latin American region (2011). As regards investments, Brazil holds 43% of the entire EU Investment stocks in Latin America.
The EU is Brazil’s first trading partner, accounting for 21. 7% of its total trade (2010). During the last 5 years bilateral trade between the EU and Brazil has grown on average by 8. 4% per year, showing the dynamism and complementarity of our trade relationship. EU imports from Brazil are dominated by primary products, in particular agricultural products (41%) and fuels and mining products (31%). But manufactured products such as machinery, transport equipment and miscellaneous manufactured products are also important: they represent around one fourth of Brazilian exports to the EU.
Brazil is the single biggest exporter of agricultural products to the EU. EU’s exports to Brazil consist mainly of manufactured products, such as machinery, transport equipment and chemicals. In goods, the EU runs an overall trade deficit with Brazil but has a surplus in commercial services trade. The EU is the biggest foreign investor in Brazil with investments in many sectors of the Brazilian economy. Around 50% of the FDI flows received by Brazil during the last 5 years was originating from the EU.
Dilma Vana Rousseff born 14 December 1947) is a Brazilian politician who has been the President of Brazil since 1 January 2011. She is the first woman to hold the office. In October 2010, Rousseff was included in the Forbes’ list of the most powerful people in the world, at the 16th position. Rousseff powerful leadership has continued to keep Brazil a strong contender in the global economy since her election in 2011. “And perhaps most impressive, she has maintained a remarkable approval rating even with a three percent drop in economic growth.” (Freeman, 2012) It can be seen that Petrobras discovery of the lula oil field in 2006 was the concrete set up for Brazils global economic uprise. The Lula oil field (formerly Tupi oil field) is a large oil field located in the Santos Basin, 250 kilometres off the coast of Rio de Janeiro,Brazil The field was nicknamed in honor of the Tupi people and later named after former Brazilian president Luiz Inacio da Silva. It is considered to be the Western Hemisphere’s largest oil discovery of the last 30 years.
“BRAZIL’S discovery of oodles of offshore oil in 2006 felt like a transformative moment. ” (Paulo 2012) The Lula field was discovered in October 2006 by Petrobras, with the well flowing 4,900 barrels per day of sweet 30 degrees API crude oil, 0. 7 sulphur content and 4. 3 million cubic feet per day (120,000 cubic metres per day) of gas from a deep sub-salt reservoir on a 16 mm choke. The former president of Brazil, Luiz Inacio Lula da Silva called the field second independence for Brazil. The field was originally named Tupi but in 2010 it was renamed Lula.
The name ‘Lula’ means a mollusc in Portuguese but also refers to Luiz Inacio Lula da Silva. The upper estimate of 8 billion barrels (1. 3 billion cubic metres) of recoverable oil would be enough to meet the total global demand for crude oil for about three months at the 2008 global extraction rate of around 85 million barrels per day. In January 2008 Petrobras announced the discovery of the Jupiter field, a huge natural gas andcondensate field which could equal the Lula oil field in size. It lies 37 kilometres east of Lula.
Block BM-S-11, which contains the Lula field, is operated by Petrobras with a 65% controlling stake while BG Group holds 25% and Galp Energia has the remaining 10% interest. According to Bear Stearns estimates, the value of the oil in the block ranges from $25 billion to $60 billion. BM-S-11 also includes Tupi Sul, Iara and Iracema fields. REFERENCE LIST Brainard, L, 2009. Brazil as an economic superpower. 1st ed. Washington DC: The Brookings institution. Medeiros, V, 2010. Interview: Jim O’Neil. Interview: Jim O’Neil, 62, 1-4. Roett, R, 2010. New Brazil.1st ed. Washington DC: The Brookings institution. Hay, D. A, 2001. The Post-1990 Brazilian Trade Liberalisation and the Performance of Large Manufacturing Firms. The Post-1990 Brazilian Trade Liberalisation and the Performance of Large Manufacturing Firms: Productivity, Market Share and Profits, 111, 620-641. Freeman, M, 2012. Brazil Pres. Dilma Rousseff a Model of Leadership U. S. Politicians Should Follow. Brazil Pres. Dilma Rousseff a Model of Leadership U. S. Politicians Should Follow, 1, 1. Paulo, S, 2012. Oil in Brazil. The perils of Petrobras, 1, 1.