Gross Domestic Product (GDP): Economist Intelligence Unit (EIU)
estimated US$775 billion for 1997, as compared with US$387 billion
for 1992. EIU's estimated GDP real growth rate for 1997, 3.7 percent;
and 1998, 4.0 percent. Of 1995 GDP of US$717 billion, 47.3 percent
generated by trade and services, 42.0 percent by industry, and 10.7
percent by agriculture.
Per Capita GDP and Minimum Wage: Per capita GDP US$5,128 (1997).
GDP per capita average annual growth rate, 0.8 per-cent (1985-94).
Minimum wage as of June 1995: US$108.46, or just over R$100 a month
(for value of real--see Glossary), as compared with US$68.93, or
R$70 a month, in July 1994, amounting to an actual increase of only
10 percent because of inflation. Minimum wage raised by 12 percent
in May 1996.
Inflation: Inflation reached 50 percent per month by June 1994
and averaged 31.2 percent a month in 1994, for total of 2,294.0
percent that year. As result of Real Plan, declined to monthly rates
of between 1 and 3 percent in 1995, for an annual rate of 25.9 percent.
In 1996: 16.5 percent; 1997: 7.2 percent.
Employment and Unemployment: Estimated labor force in 1997: 65.5
million. Services sector employed 66 percent of women and 42 percent
of men; industry, 14 percent of women and 23 percent of men; business,
15 percent of women and 15 percent of men; civil construction, 11
percent of men; other activities, 5 percent of women and 9 percent
of men. Men held 61 percent of total jobs. Women's wages averaged
62 percent of those of men but declined to 54 percent in services
sector. Recorded unemployment rate (includes only people actively
looking for work and over age fifteen) in 1997: 5.5 percent.
Agriculture: One of world's leading exporters of agricultural products.
Grain production in 1996: 73 million tons. According to estimates
of Food and Agriculture Organization (FAO) of United Nations, Brazil
produced 79.4 million tons of grains (record crop) in 1995, as compared
with 56.1 million tons in 1990. Center-West and South and Rondônia
account for 90 percent of crops. In 1995, 81.6 million tons of crops
har-vested, but producers saw their income reduced by about US$10.4
billion, or 26 percent, owing to price decreases. Country has 46.5
million hectares under cultivation, 174.1 million hectares in grazing
lands, and 140.6 million hectares in arable land. Crop year runs
from June to May. From 1982 to 1992, total cultivated area fell
by 30 percent, but production of certain grains, in tons per hectare,
increased by 14.9 percent. Agricultural sector employed 29.4 percent
of labor force in 1992. It accounted for 10.7 percent of GDP in
1996. It accounts for almost 40 percent of exports. Except for wheat,
Brazil largely self-sufficient in food. Each farmer feeds 3.6 city
dwellers, whereas 2.5 farmers were needed to feed each city dweller
in 1940. Brazil is world's largest exporter of coffee, orange juice
concentrate, and tobacco, and second largest exporter of sugar and
soybeans. In addition to sugar, Brazil produces a large quantity
of ethanol (mainly used as fuel) from crushed sugarcane. Other important
crops: manioc, corn, and rice. In addition to oranges, principal
fruits are lemons, mangoes, guavas, passion fruit, and tangerines.
Industry: Capital goods (see Glossary) production increased in
1970s with creation of new companies and large capital investments
in transportation, communications, and energy infrastructure. New
technologically sophisticated industries begun in that decade included
weapons, aircraft, and computer manufacturing and nuclear power
production. Industrial growth slowed by economic crisis of 1980s.
After start of Real Plan, industrial production increased vigorously
by 7.5 percent from 1993 to 1994. Manufacturing accounted for 62
percent of exports in 1996. Industrial growth in 1997 was 3.9 percent.
Energy: 94 percent of current energy capacity hydroelectric. Electricity
consumption expanded by 7.6 percent in 1995 (versus 4.2 percent
for GDP) and by 5.7 percent in first half of 1996 (versus projected
GDP growth rate of 3 percent). A dozen hydroelectric and thermal
plants being privatized because electricity demand expected to outstrip
supply by 1999, and state unable to pay off energy-sector debts.
A blackout in April 1997 affecting 20 million people expected to
become an increasingly common occurrence. Predominance of highland
rivers presents great potential for hydroelectric power pro-duction.
Hydropower generating potential: 106,500 to 129,046 megawatts/year,
of which 24.4 percent in operation or under construction, 35.8 percent
inventoried, and 39.8 percent esti-mated (1994 estimate). In 1992,
of 233,682 gigawatt-hours generated, 217,782 hydroelectric, 14,454
thermal, and 1,446 nuclear. Nuclear power generation in early 1998
was still negligible. About 60 percent of energy supply derived
from renewable sources, such as hydroelectricity and ethanol. National
oil production surpassed a record 840,000 barrels per day (bpd)
in 1997. Petroleum imports in 1995: 760,000 bpd (442,000 bpd crude;
318,000 bpd derivatives). Brazil relies on natural gas for only
2 percent of energy needs. Produced more than 17 million cubic meters
of natural gas per day in early 1990s.
Services: In 1994 services accounted for approximately 43.6 percent
of work force.
Trade Balance: Total trade in 1997: US$109.4 billion, com-pared
with US$77.3 billion in 1994. In ten years, 1985-95, foreign trade
of Brazil accounted for US$521.8 billion, with surplus of US$129.3
billion. Foreign trade deficit in 1997: US$10.9 billion.
Imports: Totaled US$60.1 billion in 1997, as compared with US$20.5
billion in 1993. Average import duties dropped to 14 percent from
51 percent since 1988. Major suppliers in 1996: United States, 22.2
percent; Germany, 9.0 percent; Argentina, 12.7 percent; and Japan,
5.2 percent. Half of Brazil's imports of manufactured goods come
from United States. Brazil only other major Latin American country
besides Chile to import oil, which in 1996 cost an estimated US$6.4
Exports: Totaled US$49.2 billion in 1997, as compared with US$39.6
billion in 1993. Brazil's strengthened currency has made its exports
less competitive. Brazil exports large part of world's production
of tin, iron, manganese, and steel. Also one of world's largest
exporters of food, mainly sugar, coffee, cocoa, soybeans, and orange
juice. Major markets in 1996: United States, 19.5 percent; Argentina,
10.8 percent; Japan, 6.4 percent; and the Netherlands, 7.4 percent.
Tariffs: Average tariff rate: 14.0 percent; tariff ceiling: 70
percent on automobiles (imposed in mid-1995).
Reserves: International reserves in first quarter of 1998: US$63
Budget Deficit: Current account deficit in 1997: US$32.3 billion.
EIU's current account deficit estimate for 1998: US$33.6 billion.
Internal Debt: Total debt of public sector (federal, state, and
municipal governments): US$77 billion (1994). Totaled record US$213
billion (36.8 percent of GDP) in 1995, according to official figures,
or US$267 billion (46 percent of GDP), if some unregistered existing
debts included. IBGE calculated total domestic debt to be R$304.8
billion in September 1995, or 60.9 percent of estimated 1995 GNP.
Public Sector Borrowing Requirement reached 5.6 percent of GDP in
1996, as compared with 5.1 percent in 1995.
External Debt: US$177.6 billion (public and private) in 1997; US$193.2
billion estimated by EIU for 1998. Total debt service: US$15 billion
(1996). Debt-service ratio: 58.7 percent (1997).
Official Exchange Rate: On July 1, 1994, new currency, the real
(pl., reais), introduced. As of January 31, 1996, government widened
to 7.07 percent range within which value vis-à-vis United
States dollar may vary. Exchange rate on April 13, 1998: R$1.140=US$1.
Foreign Investment: US$52 billion in 1996, US$38 billion in 1995,
and US$25 billion in 1994.
Fiscal Year: Calendar year.
Fiscal Policy: Stabilization program in 1994-96 developed originally
by Fernando Henrique Cardoso (president, 1995- ) as minister of
finance (May 1993 to April 1994). End of inflation in 1994 quickly
increased demand and spending power of poorer Brazilians especially.
Government endeavoring to dampen inflationary pressures. In order
to consolidate stabilization program and put Brazil on path to long-term
sustainable growth, government must implement wide-ranging structural
reforms. Restrictive monetary policy has kept interest rates high
and reduced aggregate demand and inflation, while improving trade
balance. Fiscal position deteriorated considerably in 1995. Expansion
of internal public debt a major threat to government's control over
fiscal and monetary policy. Monetary policy somewhat more flexible
since August 1995 because of lower level of economic activity, declining
inflation rate, and abundance of foreign capital to finance current
Data as of April 1997