Looking back at Brazil’s contemporary economic data of the 1980s, it is hard to imagine Brazil’s climb as a premier emerging economy today. From 2001 to now, Brazil is a middle-income country in the BRICS alliance. Also, its enormous continuous discoveries of rare earth minerals has pushed Brazil to the top of emerging economies. Given its large rare earth mineral finds, Brazil will be positioned to become a maverick of advanced technological applications. Today, Brazil ranks seventh (7th) in the world with foreign exchange reserves sitting at $376 billion as of July 2014 and its nominal GDP sitting at 2.2 trillion and ranked 7th again.
In the area of alternative energy sources for its large consuming population, Brazil has implemented proactively the use of its huge sugarcane product and converted it into ethanol to produce non gasoline based fuel.
Brazil is a country that does not rest on its laurels. For instance, it decided in the late 1970s that it would not allow itself to become a permanent hostage to future Arab oil embargos after the Arab Oil Embargo of 1973-74. Back in the late 1970s was a time when the Brazilian government began working on alternative energy solutions for its consumer and industrial bases. For Brazil the continual work on alternative energy solutions has paid off in very good dividends. For example, it has become very cost effective and efficient for Brazil to produce their ethanol based product in Brazil as it produces more agricultural jobs for Brazilian farmers.
It is also a BRICS economy that purchased $10 billion bonds from the International Monetary Fund (IMF) in 2009. This was a strategic move as Brazil proved it can turn around and make IMF a small time debtor entity of Brazil. This was also very important because, in the past, Brazil was so accustomed to borrowing from IMF and the US and being put on an austerity budget.
Brazil has very good bilateral relationships with other countries – especially with its fellow BRICS alliance members of Russia, India, China, and South Africa. Brazil has also proven it can talk directly and geopolitically to Iran when the US and other Western nations could not. Currently, Brazil is seeking permanent membership on the UN Security Council. This would increase BRICS country membership from two to three BRICS members on the Security Council if Brazil’s application is accepted and approved by other members – particularly approved by the US.
Brazil enjoys a very good trade relationship with China as China imports a large supply of Brazilian soy beans and iron ore; thus, intensifying intra-trade between two BRICS economies. Presently, China is the number one trading partner to Brazil not the US, and China sends a weekly trade mission to Brazil. In 2013 at the BRICS meeting in South Africa, both Brazil and China agreed to a yearly 30 billion USD in currency swaps.
In the world of economics, Brazil is dancing a successful and well watched BRICS Samba of economic prosperity. Also, global investors are eyeing Brazil very closely as it continues to have the status of an emerging economy.