...1. Introduction The purpose of this paper is to analyse the impact of an increase in world’s interest rates in the Brazilan economy. Furthermore the macro exposure of Grendene, a Brazilian shoe manufacturer will be analysed. Grendene’s vulnerability and market exposure will also be accessed. Moreover the level of protection of the company will be approached. 2. Macro effects of an increase in world interest rate on the Brazilian economy Brazil is one of the fastest growing countires in the world and is part of the so called BRIC economies (Brazil, Russia, India and China). Currently the Brasilian Central Bank basis rate SELIC (Brazilian Central Bank’s rate for overnight lending) is at 8,50% p.a. (COPOM - Committee of Monetary Policy). Even if this rate is low compared to historical rates (Figure 1) it continues to be one of the highest interest rates in the world, atracting a high flow of international investments. Due to the large capital inflows, the Brazilian Real has appreciated in the last years diminishing the competitiveness of Brazilian products in the world market. Since 2009, Brazil has experienced high capital inflows mainly due to abundant global liquidity and high interest rates compared to developed countries (OECD, 2011). [pic] Figure 1: Historical interest rates in Brazil (Source: Banco Central do Brasil) In a general point of view, an increase in interest rates will cause a decrease in aggregate demand...
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...Since the great depression, our understanding of what makes an economy grow or contract changed a bit. New macroeconomics concepts became popular, sometimes even taking place of classic ones. Using those concepts, Christopher Sabatini wrote the article “The Rot at the Heart of the Brazilian Economy”, published by the Foreign Policy (FP) website on the last February 10th. In the article, Sabatini tries to explain what went wrong with the once very prosperous Brazilian economy, which in the past years has been diving into a recession that is so deep that many economists already call it a depression. The purpose of this paper is to explain how the Keynesian concepts of aggregate demand and fiscal policy that I learned in the macroeconomics classes...
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...| 2015 | | | [Cultural Analysis - brazil] | MKT 6003 RESEARCH PAPER | Abstract I currently lead a team called Pontonet as part of my responsibilities as Sr. Strategic Customer Manager who is based in Brazil. When I began my job in August I was quickly introduced and held meetings with my manager and a co-worker. I noticed very quickly that our abrasive American ways of communicating was not effective by listening in on conference calls with the three of us. I noticed as well that there was a seemingly deep sense that creating a more relation type of Management/Vendor management style was would make for a clearer and cleaner method than the alternative. I learned in haste that my report Jurandir at Pontonet began to surpass expectations quickly in comparison to other vendors in a surprisingly quick time frame. This paper shall also attempt to analyze the business and social culture of Brazil from an American point of view. In addition my purpose is to help achieve the most success when participating in a leadership activity with Pontonet. By having a better grasp of the cultural norms I believe that it will greater help me to have an advantage as a leader for this 3rd party management role I have accepted as part of my responsibilities. It is my understanding through research that Brazil’s business culture is much more stringent than the United States. In this paper it will be my intent to provide analysis and review the current business culture and...
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...SUMMARY You may find certain aspects of Brazilian culture to be strange and quite different from what you are used to in Canada. One of the major differences is that Brazil is a collectivistic culture as measured on Hofstede’s Individualism Index, in contrast to Canada’s individualistic culture (Hofstede, 2014). Brazil’s collectivist nature will have many impacts on your daily interactions, including the Brazilian importance of family, which will often be place above work priorities (Training, 2012). Brazil is also different in its communication style, which tends to be more informal and indirect than Canada’s formal and direct style. Brazil is also considered a high-context culture, therefore it is important to pay attention to what is said, how it is said, and what is not said (Suderman, 2008). Another major aspect of Brazilian culture is the importance of building relationships before commencing business. Brazilians expect to get to know their business contacts through multiple meetings, in order to establish trust, and hopefully a friendship (DiPaolo, 2006). This process may take some time as it illustrates Brazil’s Polychronic orientation, which is more relaxed (slower) in nature and where the prevailing attitude is that “things will get done in their own time” (Suderman, 2008). Brazil is also very comfortable with inequality as evidenced by their high score on Hofstede’s Power Distance Index (Hofstede, 2014). As a manager in Brazil you will be expected to take absolute...
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...I. The Brazilian Macro-Environment Investment Climate Analysis Brazil is quite interesting place for investment and many companies are entering this developing market. Its high GDP growth, large economy, developed infrastructure, liberalisation of public sector and many Foreign Direct Investments have turned this struggling country into developing nation that holds 2nd place (China is 1st) in amount of foreign capital invested into the economy. In last 5 years, Brazilian government has been quite stable and it seems that Brazil has a sound strategy when it comes to taking its economy into top performing ones. Government is introducing new, more liberal competition laws and it is introducing new forms of investments, such as PPP, or Private Public Property, where both the investor and government share the risks by holding equal stakes in the investments. But, let us not be blinded by the Brazilian marketing skills and their portraying of real investment climate. There is for sure a lot of space for improvement. We will perform a few analyses, which will give us precise insights into the environmental conditions for investing in Brazil, and through analysing this country; we shall decide what type of investment is the most suitable for Red & Green. PESTL Analysis Investment climate is the economical, institutional, policy, and regulatory environment in which firms operate. A PESTL analysis is an analysis of the external macro-environment that affects all firms....
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...evening soap operas known as telenovelas and sporting events are popular and coveted advertising space (O’Barr, 2008). Since the average Brazilian tends to watch an average of five hours of television per day, television comprises of 59% of the media mix and the Brazilians are overtly loyal to their evening news and telenovelas so to center their time around those events (Millwardbrown, n.d). Other media channels include the newspaper at 18%, magazines at 9%, radio at 4.5%, and internet at 1.5% but growing fast (Millwardbrown, n.d). Millwardbrown (n.d) further advises that Brazilians “don’t usually like comparative ads or ads that denigrate the competitor” and states that advertising investments is 50 times less than U.S or less than 1% of GDP and that the majority is spent with the dominant advertising force at Rede Global de Televisao (television) who owns the majority of the channels in Brazil. Costs for advertising are increasing and as of 2006, R$ 950 million was spent (Millwardbrown, n.d). Acir (2011) points out that it is important to realize that the internet industry is on the rise and changes to advertising in this media mix should be reviewed and not be a missed opportunity for market penetration. Sales promotions customarily used in Brazil include social media groups ‘twitting’ about latest sales as 63 millions Brazilians have access to internet and e-commerce (Global Intelligence Alliance, 2010). Furthermore, Global Intelligence Alliance (2010) state that...
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...Throughout this essay I will be addressing the social, cultural and economic impacts which affect Brazil community. Rio de Janeiro carnival dates back to 1723 it is one of the world’s biggest carnivals, it is a hallmark event. It is known to be one of the most interesting artistic celebrations it involves 4 days of continuous partying and having fun before Ash Wednesday. This event provides an insight into the true culture of Brazil it showcases their beliefs and moralities. It is considered to be a performance of farewell to the pleasures of flesh which is the absence of human temptation and food desires. This event is performed annually 46 days before Easter and the celebration involves dancing, singing, party and having loads of fun with one of the major highpoints being the "samba" music. The purpose of the samba is to signify hedonism also the true celebration of life. It is known in Brazil that 75 % of the population is Roman Catholic therefore the carnival demonstrates all the different cultures and their backgrounds. (Enjoy festivals 2013) Having the Rio de Janeiro carnival it benefits the community by improving social ties and it gives the opportunity for the community that they can pull it together for the greater good. (Perry, S 2010) Rio de Janerio carnival is classed as a hallmark event. A hallmark event is an event that takes place annually in the same place; this will then bring to mind the location of where the event was held. It is also where the event becomes...
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...Economics 1, BUS 121 The economy of Brazil is in the top ten largest economies along with the United States. It is the biggest in Latin America. Actually it is the seventh largest in the world. Brazil has used its newly found economic mechanism to syndicate its outcome in South America and show more of a role in the Global Businesses. The Obama Administration’s National Security Strategy recognizes Brazil as a developing center of effect, and greets the management of the country’s joint and global issues. The United States and Brazil associations mostly have been good in the recent years. But Brazil has other strengthening relations with neighboring countries and expanding ties with nontraditional partners in the South that’s developing. Some foreign policy disagreements have transpired but the United States and Brazil continues to engage on matters such as security, energy, trade, the human rights, and the environment. Brazil is the biggest economy in Latin America with a GDP of $2.4 Trillion. Over the past decade, the country has appreciated average annual growth of 3.7%. This growth has been motivated by a bang in worldwide demand for its product exports and the increase in purchasing power of Brazil’s fast-growing middle class. The country has also been benefitted from a number of policy improvements that have reduced the increase and allowed Brazil to absorb better global blows like the fresh worldwide economic crisis. Brazil is a member of diverse economic organizations...
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...business. Here are some facts about Brazilian Cultures’ components. Brazil’s official name is Federative Republic of Brazil but even its citizens do not prefer using whole name. According to last research the population is roughly 200 million and estimated to be growing at about 1.6 percent per year. Young population has a significance share over population. Since 62% of Brazilians are under 29 years of age. Brazil has six climatic regions: tropical rainforest, tropical wet and dry, tropical monsoon, hot semiarid, humid subtropical and subtropical highland. Although most of Brazil lies in the tropics, more than 60 percent of the populations live in areas which are cooled either by altitude, sea winds or polar fronts. While the coastal cities of Rio de Janeiro, Recife and Salvador can get extremely hot, plateau cities such as São Paulo, Brasília and Belo Horizonte have mild climates, and the southern cities of Porto Alegre and Curitiba have mild winters. It is extremely important to know for foreign businessman because climate is as important as culture. For example for housing; people get seasonal work because of climate change. It is also important where you put your business your house. We as a housing team should consider the right place and how deal with climate. Brazil’s official language is Portuguese with the almost spoken rate of 100%. English is the most foreign language used in business cases as well. Lastly, 80 percent of Brazilian believe...
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...Italian Culture in America John Smith Psych 105 Dr. Diop Spring, 2012 Italian Culture in America America is known to be the country where most people from outside immigrate to, not only bringing their families but also their traditions with them. “According to the 2000 U.S. Census, almost 16 million Italian Americans live in the United States” (Quagliata, 2011, p. 1). Most immigrants that come to America lose their heritage; however, that is not the case for the Italian culture. Not only did Italians incorporate a style of living in America, they also brought their traditions into the country as well. Some of the customs they brought with them include their food, their game of bocce ball, their religion, and their way of greeting one another. Italian Food When thinking of the Italian culture, the first thing that comes to mind is their food. Cinotto (2000) states, “Since food is a cultural artifact, imbued with meanings and values, the cross-cultural consumption of Italian cuisine is a significant marker of the way in which others see and imagine Italy and the Italians” (p. 1). Pasta, parmesan, and cannoli’s are probably the most popular and most known Italian foods. With the way many Americans fell in love with the Italian food, it soon became part of the American culture as well. The Italian immigrants brought over their historical foods and formed new eating habits for the Americans, and most of the Italian food was shaped in Little Italy where the...
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...home to Reveillon, a high-spirited New Year’s celebration. Early that day restaurants serve special buffet lunches, and by evening all the citizens gather along the cities beaches to watch a fireworks display at midnight. For people of the Afro-Brazilian religion New Year’s celebrations include dressing in all white, lighting candles, and setting small boats loaded with gifts into the ocean as an offering to the sea goddess Yemenja. In Sao Luis the Bumba-meu-boi festival takes place, the celebration lasts several months and the townspeople act out a folk story about the killing and resurrection of a bull. In Salvador women in traditional costumes wash the steps of Bonfim Church with perfumed water at the end of January. Brazil is rich in festivals and celebrations as well as traditions, from sports to dance to religious rites. Brazil’s enthusiasm for soccer has launched the sport into more of a national obsession rather than tradition. Candomble traditions include offerings to Lemanja during the new year, and in Salvador they have Boa Morte, or beautiful death, which incorporates music and dance. Samba music come from the Bantu people who arrived in Brazil from Angola and it has evolved into Bossa Nova, another traditional form of Brazilian music. Capoeira is a martial art based on self-defense practices brought by African slaves, it was originally necessary to disguise a practice so the art now resembles dancing. Brazil is a melting pot of colors, languages, and customs and its’...
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...remarkable is the amount of Brazilian nationalism that is expressed in almost all Brazilian songs. The place that we can see this tremendous surge in Brazilian nationalism is in the movie Orfeu which we recently finished watching in class. This movie showed us, not only how important Carnival is to the country of Brazil, but also how much the music that we hear during the Carnival influences the thriving culture that Brazil has today. Throughout the movie, we see the hardships that the people of Brazil are forced to endure, while they live in the shantytowns of Rio de Janeiro during the coming months of Carnival. These people went through life almost as if they had nothing to live for besides the Carnival itself. Every minute of every waking day, these people spent preparing for the Carnival whether it was on their costumes, their music, or their dance routines. During this time of preparation, there we street gangs that ruled the streets during the night and paid off the police so that they would never be held responsible for their actions against the people of Brazil. Since the movie was entirely in Portuguese, I do not remember the exact quote that Orfeu said during the movie, however; I believe that he said something along the lines of this, “it is unfortunate that this country has become overrun by the corrupt and manipulated by the strong” (Orfeu, 1999). With this quote, I believe that Orfeu is trying to point out to his fellow Brazilians that there is a problem with...
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...between the U.S and the Brazilian culture is the individualism. In the United States, individualism is practiced 91% compared to Brazil with 38%. People in the United States think more as “I” compared to Brazil which think and act more as “we”. In Brazil, power distance is practiced a lot because all the individuals in the society are not equal. Also, the power holders have more benefits than the less powerful in the society. In Brazil the power distance is 69 compare to the United States with 40. When it comes to masculinity, the score of Brazil is 49 and the United States 62. Reading with scores the United States is more driven to success, achievement and competition and Brazil has a lower score. For long term orientation, the United States scores lower than Brazil with 26 and Brazil scores is 44. This being said, Brazil takes more pragmatic by encouraging thrift and efforts in modern education as a way to prepare for the future compare with the United States. According to geert-hofstede.com, “At 76 Brazil scores high on UAI – and so do the majority of Latin American countries. These societies show a strong need for rules and elaborate legal systems in order to structure life. The individuals need to obey these laws, however, is weak. If rules however cannot be kept, additional rules are dictated. In Brazil, as in all high Uncertainty Avoidance societies, bureaucracy, laws and rules are very important to make the world a safer place to live in. Brazilians need to have good and...
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...we make investments in a foreign company, we first have to evaluate all the parameters. Why Brazil and India? Brazil and India are one of the fastest growing economies in the world. They are now on the heat map for the investors. Also they are now making its mark in the world politically as well as financially. They are a part of BRIC which is one of the most powerful associations. Hence we selected Brazil and India for comparative study. Objective of Study The objective of our study is to look at various factors which an Investor looks at before investing in a country. Here we have analysed specific sectors and the problems in these countries. Structural Issues in Brazil: Since the mid 1990s, Brazil has enjoyed improved economic and financial stability largely owing to a strengthening of its macroeconomic framework. In order to quickly catch up with other countries, sustainable growth is required. To obtain this Brazil has to identify and deal with the structural problems it faces. Structural Issues Basic Logistic Infrastructure Competitive advantages in the modern world do not only depend on the supply of assets accumulated in the past via public and private investments. They also depend on the efficiency with which the new investments contribute to the rise of the average productivity of the economy. The necessity of their continuity, the performance of regulating agencies in the areas of oil, electric energy, telecommunications, carriers, water, and ports is...
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...presence in international financial and commodities markets, and is one of a group of four emerging economies called the BRIC countries. Although struggling with social inequality and infrastructural deficits we think that Brazil is already a great world power. Also what attracted us to Brazil as a case study for this report is it’s exotic character. Not many people really know the extent of Brazil’s recent growth and improvements in social security and in overcoming poverty. We expect the labor force and operational costs to be low, like in the other emerging countries like China. However we take in to consideration higher costs involving security and bureaucracy. Chapter 1 – Short presentation of the country The Federative Republic of Brazil is the largest country in both South America and the Latin America Region. It is the world's fifth largest country, both by geographical area and by population, with over 193 million people. It is the largest Lusophone country in the world, and the only one in the Americas. Bounded by the Atlantic Ocean on the east, Brazil has a coastline of 7,491 km. It is bordered on the north by Venezuela, Guyana, Suriname and the French overseas region of French Guiana; on the northwest by Colombia; on the west by Bolivia and Peru; on the southwest by Argentina and Paraguay and on the south by Uruguay. Numerous archipelagos form part of Brazilian territory, such as Fernando de Noronha, Rocas Atoll, Saint Peter and Paul Rocks, and Trindade and Martim...
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