Modern Brazil

Modern Brazil

For almost four and a half centuries, the Brazilian economy relied solely on the production of primary products such as Brazilwood, sugarcane, and coffee. The 1930s in Brazil was a period of consistent political and economic changes that started with the revolution in 1930 that abolished the Old Republic. Developmentalism was the key for these political and economic changes. Developmentalism is a way for Brazil to place economic development at the center of political endeavors in order to achieve economic prosperity. In 1930 Getulio Vargas seized power in Brazil on the grounds of election fraud. This marked the beginning of an era dominated by developmental programs that aimed to unite all Brazilians in the pursuit of a common good. During his first years, Vargas was intent on modernizing the Brazilian economy. After the coffee economy suffered a substantial blow caused by an excess of production in the 1920s and the Great Depression, the government needed to find a way to change Brazil into a modern, industrialized economy. It was clear that Brazil could not solely rely on export goods any longer and a need for economic diversity was imminent. During the late 1930s Vargas and other officials established the first government enterprise, an integrated steal mill. In 1945 Vargas and the Brazilian government then enacted an import substitution industry to help stimulate the economy. This policy raised tariffs on imported goods in an effort to help Brazil out of their reliance on imported goods and encourage economic growth within the country. This led to a large influx of Brazilians into the cities and away from the rural areas. The late 1940s though 1962 marked intense import substitution, particularly for consumer goods. 1962 though 1967 saw the Brazilian economy come to a standstill. There were many problems associated with the import substitution industry in the early years that were compounded with the reforms introduced by the military regime in...

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