Economy

Despite widespread poverty, Brazil has the world’s 9th-largest economy. Agriculture remains the largest sector in terms of employment and Brazil is the world’s second-largest exporter of agricultural products, principally coffee, sugar and soya beans. There is also a substantial industrial sector, concentrated in machinery, electrical goods, construction materials, rubber and chemicals and vehicle production.

The country possesses large mineral reserves including iron ore - of which Brazil is the world’s largest exporter. Plans to develop Brazil’s potentially vast oil and gas resources will serve to reduce the country’s large current energy import bill but face opposition on environmental grounds.



After difficulties throughout the 1980s, as the economy adjusted to new liberal economic policies, Brazil recorded a fairly strong economic performance during most of the 1990s. Industrial efficiency and financial management were improved while the government bolstered its coffers through privatization. However, little of this money was directed towards investment and Brazil has suffered the consequences of years of under-investment in infrastructure and public services.

The Lula government, which took office in 2003, enjoys widespread popularity for the combination of its progressive social policies and its sound fiscal management, leading to significant annual economic growth (over 5% in 2007). Unemployment was at 9.8% in 2007, with inflation at 4.1%.