Emergin Markets_Brazils Quest for Comparative Advantage

1140 words 5 pages

Case Study 1: Emerging Markets: Brazil’s Quest for Comparative Advantage

Table of Contents: Page Number
Abstract 3
What Makes Brazil’s Economy Competitive 4
Brazil’s Eager to Develop World-Class Manufacturing 5
Shifting Brazil’s Economy 5
On Ethics 6
Conclusion 6
References 7

When it comes to Global Business, Strategic/International Trade, among other forms of doing business domestic and internationally, it is crucial to follow on of the most important principles in all economics; comparative advantage. This theory was developed by
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Its main products such as beef, coffee, poultry, soybeans and sugar, have given Brazil an advantage in the agro-industry. However, they struggle globally due to rise in the costs of energy, raw materials and wages.

Shifting Brazil’s Economy from Uncompetitive Industries to Competitive Industries
Brazil has high potential on becoming World Economy High Competitive Industries. However the government is affecting tremendously in this to happen. One of the main factors affecting their competitiveness is high manufacturing costs. To make Brazilian market competitive, Brazil needs to reduce their labor costs by work efficiency and automation. Also the government should make adjustments to lower interest rates and taxes. “It is evident that to meet the complexity of our challenges, Brazil needs structural reforms in the most diverse fields. Tax exemptions, foreign trade stimulus, expansion of corporate credit, trade protection measures and incentives for significant sectors are some of the timely measures established by the PBM that need to be incorporated into the essence of a national development strategy” (Deloitte, 2012)

On Ethics
President Rousseff’s has many critics accusing her of lacking of comparative advantage in manufacturing. She also has Brazilians supporting the fact that Brazil does not need dependence of