Brazil and the Mercosur

Brazil is the core state of South America and sustains an alliance called Mercosur. Mercosur Is a trading zone between Brazil, Argentina, Uruguay and Paraguay, founded in 1991 by the Treaty of Asuncion.
Its purpose is to promote free trade and the fluid movement of goods, peoples, and currency.
Mercosur tariff policies regulate imports and exports and the bloc can arbitrate in trade disputes among its members.
In the longer term, Mercosur aims to create a continent-wide free-trade area, and the creation of a Mercosur development bank has been mooted.
Some South Americans see Mercosur as giving the capability to combine resources to balance the activities of other global economic powers, perhaps especially the United States and the European Union.
There are more than 220 million consumers in this region (South America) and the combined Gross Domestic Product of the member nations is more than one trillion dollars a year.
Mercosur was the focus of much European attention during the 1990s, both politically and economically, attracting large amounts of investment to the region. Mercosur has drawn Brazil closer to the European Union, functioning well as an instrument of Brazil's external ambitions, though also exposing it to the risk of free trade with Europe. For both Mercosur and EU-Mercosur relations to remain useful to current Brazilian ambitions, they must remain short of achieving their final goals and linger in a prolonged state of negotiation. Some EU states also prefer this solution. Faced with the challenge of reviving Mercosur, the president of Brazil might have to make difficult choices with regard to Brazil's own interests. Through an EU-Mercosur agreement Brazil could resuscitate the Argentinean and Uruguayan economies, though this might be at a cost for Brazil. Will Brazil be willing to pay this price in order to preserve Mercosur?

Landless Workers Movement in Brazil

No other sector of Brazil’s society has suffered as much as the rural poor from the country’s insertion into the global economy. Policies responding to international financial institutions and designed to soften trade protections have spelled high interest rates, increased competition from subsidized food imports, the end of government agricultural extension services, and sluggish land reform programs. All of this has institutionalized penury, hunger, and joblessness in the Brazilian countryside. Thousands of families have been forced to abandon bankrupt farms and flee rural violence to join the ranks of the urban poor.
The hardships in the era of globalization come on top of this South American nation’s longstanding problem with its record for one of the worst land distribution patterns in the world. The wealthiest 20% of the Brazilian population owns 90% of the land. Much of that property is not in production, used for ranching that benefits a minority, held for tax write-offs, or occupied in producing export crops; while at the same time millions of families without employment or land for subsistence agriculture go hungry.
The distress in Brazil’s countryside has given rise to one of Latin America’s largest social movements, the Movimento dos Trabalhadores Sem Terra (Landless Workers’ Movement, or MST). Brazil’s Landless Workers Movement, or in Portuguese Movimento dos Trabalhadores Rurais Sem Terra (MST), is the largest social movement in Latin America with an estimated 1.5 million landless members organized in 23 out 27 states.
The MST has won land titles for more than 350,000 families in 2,000 settlements as a result of MST actions, and 180,000 encamped families currently await government recognition. Land occupations are rooted in the Brazilian Constitution, which says land that remains unproductive should be used for a “larger social function."
The U.S. has an important stake in Brazil's continued economic stability. U.S. financial institutions hold a sizable chunk of Brazil's $260 billion public debt, and the nation's 170 million consumers represent a key market for corporations such as General Motors Corp., Whirlpool Corp. and Citigroup Inc.

http://www.corpwatch.org/article.php?id=7713
http://www.mstbrazil.org/?q=about

Carnaval

Carnaval season has officially began in Brazil. It is concidered to be by some the biggest event of the Universe. It is for sure the most famous festival. Carnaval begins on the 13th and for the next four days, Brazil will be immerged in the colorful state of party and extreme happiness that made Carnaval what it is today. Although Carnavil is celebrated all over Brazil, the biggest event is in Rio de Janeiro. The parade in the Sambodromo began on the 14th and continues on to the following day. During this period, twelve first class School of Samba will light up the arena with their magnificent allegoric cars, thousands of "sambistas" marching to the samba-enredo's rhythm and a whole bunch of tradition and history told in the most spectacular way. The judges will grade the many aspects of each school's presentation and a winner one will be chosen.

Although Carnaval is directly related to Rio, Sao Paulo also has its good share of the pie. In the northern states of Brazil, particularly in Bahia and Pernanbuco, Carnaval's structure is a little bit different but the feeling and the meaning are pretty much the same. There, people go out on streets and squares where many Axe concerts and events happen simultaneously.

The country stops completely for almost a week and the festiveties are intense, day and night. The consumption of beer account for 80% of annual consumption and tourism receives 70% of annual visitors. Although economically Carnaval turns out to be a gold mine, the informal fun-day-out is really a national passion. The financial matter is little responsible for that. It happens mostly because of its magnetic all-good veil that welcomes whoever wants to be a part of it.

http://www.examiner.com/

Inflation in Brazil

From 1964 through 1994, the accumulated inflation rate in Brazil fetched 1,000,000,000,000,000 % (that´s one quadrillion percent).
Because of the very high inflation rates in the 1980s and early 1990s, the country had to change currency several times: Brazilians were used to dealing with Cruzeiros until 1986; that year, an economic plan cut three zeros from the bills and changed the currency to Cruzado; a few years later, another three zeros were dropped, and Brazilians were introduced to the Cruzados Novos ("new cruzados"). In 1990, the Cruzados Novos were retired, and the Cruzeiros were back; in 1993, the Cruzeiros lost another three zeros and were turned into Cruzeiros Reais.In 1994, after the deployment of a new monetary plan, the new currency, called Real, came to life.
Until 1986, inflation was fought (mostly) by following the Economics books. That year, yearly inflation was running at more than 100% for the second year in a row (1985: 225%), and the government felt the necessity to adopt more extreme measures against it.In March of 1986, the Plano Cruzado was announced, anchored in practically only one idea: all prices of the Economy were frozen (including salaries, but these had an increase first). The President assigned all citizens with the job to control prices in every shop in the country; TV showed supermarkets being closed and managers being arrested, because prices had been raised. The Plan worked fine for a few months, but natural sequels soon appeared: forbidden from changing prices, the producers either refused to sell (creating a black market for several products) or just re-launched "new" products with a "new" higher price. Late in 1986, right after the elections, the government came with Plano Cruzado II, with a general increase of prices and taxes.From 1986 through 1994, a few other heterodox Plans were deployed. The outcome: accumulated inflation for 1987 was 366%. In 1989, the Summer Plan once again froze prices and proposed the privatization of State companies and the dismissal of civil servants; in December alone, the inflation was over 50%. In 1990, the wildest plan of all, the Collor Plan. The accumulated inflation from March 89 to March 90 had been almost 5,000%. In 1991, the sequel: Plan Collor II. This plan attacked the indexation: all short term financial transactions (which paid interest daily) were prohibited; the Plan Collor II failed. In 1993, Real Plan was implemented. Since 1994, inflation has been maintained at civilized levels (2003, consumer prices rose by about 8%; in 2005, the inflation target is around 6%), and the Brazilian citizens had the chance, for the first time in a long period, to get accustomed to a stable currency.
Since then the Brazilian currency has been the Real (plural: Reais), which symbol is R$.There are bills of R$1, R$2, R$5, R$10, R$20, R$50 and R$100.

Formerly, the bills were illustrated with images of Historic characters; problem was, however, that the high inflation caused the bills to loose value too fast, and what was supposed to be a homage turned into a mockery. Nowadays, the bills are illustrated with images of Brazilian animals (the feminine character on one side of all bills is a representation of the Republic).

Coins exist in values of 1 cent (R$0.01), 5 cents, 10 cents, 25 cents, 50 cents and 1 Real. Coins vary in size and color. Since the release of the Real, some coins were discontinued.

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