Clinton: thumbs up for Brazil
BeyondBrics
At a conference in São Paulo today, former US President Bill Clinton put his money behind Latin America’s biggest economy over China and India.
From Reuters:
“If I were just sitting in a room betting on the future of rising countries, I’d bet on Brazil first,” Clinton said…
Clinton, speaking at a forum of bankers in São Paulo, acknowledged some problems but said Brazil still “looks really good” compared to crisis-ridden economies in Europe and the United States.
He said Brazil also compared favorably to India, which is struggling with a stagnant economic reform agenda, and China, which has tensions with some of its neighbors and is at risk of suffering from water scarcity and other depletion of natural resources, he said.
China “would kill to have the environmental problems you guys do,” Clinton told the mostly Brazilian audience.
It is hard to disagree with him. Brazil does not have the vast populations of India or China and therefore can increase per capita income more easily.
Brazil has 60 per cent natural vegetation cover – a claim that even most small countries could not make, and controls a large part of the world’s fresh water.
Brazil has no real enemies and not much by way of natural disasters.
Latin America’s largest economy is also relatively well governed, is stable and democratic. It has had a centre-left government for the past nearly 10 years that is proving to be pragmatic, recently turning to the private sector to help it develop much-needed infrastructure.
It was ironic, however, that the person who broke this positive narrative at the event, which was held by Itaú BBA and also attended by former British Prime Minister Tony Blair, was Brazil’s former president Fernando Henrique Cardoso.
Of course he has an axe to grind – he is from the other side of politics from today’s government. But Cardoso is widely respected for conquering Brazil’s endemic inflation and stabilizing its currency.
From Reuters:
Cardoso, whose party is now in opposition, said President Dilma Rousseff and her predecessor, Luiz Inacio Lula da Silva, have relied too much on stimulating public and private-sector credit, while slipping on the fiscal rigor that helped his government establish Brazil’s credibility in global markets.
“There’s an impression that things are the same (as in the 1990s) but in reality there has been a lot of change,” Cardoso said.
If there is any message there, it is that there is no room for complacency. Brazil is almost too lucky – after all, it has had many of the advantages listed above for the past 500 years of European settlement. The challenge today is to seize this moment