Brazil is the world’s fifth largest country by both population (roughly 210 million) and geographical area (3,287,597 square miles). It is also the world’s eighth largest economy and previously hosted the 2016 Olympics. Despite these feats, Brazil struggles to recover from the worst recession in its country’s history. While Brazil is not poor, the level of people in poverty there is well above the norm for a middle-income country. Here are three answers to the question, “Why is Brazil poor?”
1. Inequality of Land Distribution
According to USAID, inequality of land distribution is a major factor contributing to poverty levels in Brazil. Brazil’s poor have inadequate access to desirable land, and NPR reported in 2015 that one percent of the population controls 50 percent of all the land in Brazil.
This means that 2 million people (out of a total population of 210 million) control half of the country’s entire square footage. The other 99 percent have little access to land ownership, making it difficult to improve their economic status. Brazil is one of the most unequal places in the world when it comes to land distribution.
2. Education
Claudia Gostin, the education secretary for the city of Rio de Janeiro, told the Global Post that Brazil has educational apartheid taking place in its country. Apartheid is a system that separates people on the basis of color, ethnicity or class. Brazilian schools are separated by class and one could also argue race.
According to the Global Post, class divisions in Brazil are ingrained around the age of five. Depending on their economic class, Brazilian children are either sent to rundown public schools that prepare them for mediocrity or they are sent to high quality private institutions that prepare them for upper echelon roles in society. Lower class Brazilians are taught by second rate teachers in under resourced buildings with shorter school days than their peers. These factors lead to several drop outs and graduates who are unprepared to compete for high tech jobs in the white-collar work force.
In addition, Brazilians who identify as black or brown and compose more than 50 percent of the population have income levels that are half of whites. This keeps Brazil’s black and brown population in poverty and at the end of Brazil’s social totem pole.
3. Corruption
According to the World Factbook, Brazil’s economy has been affected by several corruption scandals involving private companies and government officials. Penalties against the companies involved — some of the largest in Brazil — limited their business opportunities, producing a ripple effect on associated businesses and contractors.
In addition, investment in these companies also declined due to scandals. This is in turn has had a negative effect on the country’s poor population because companies involved in the scandals cut jobs. For example, Corporate Compliance Insights states that oil company Pertrobras was the country’s largest company and investor making up 10 percent of Brazil’s economy, but after a corruption scandal within the company, Brazil lost 27 billion (at least 1 percent) in GDP in 2015. The company also reduced its workforce by 34 percent, and fewer jobs equals less opportunities for Brazil’s poor to improve their circ*mstances.
So, why is Brazil poor? A history of inequality that runs deep in the country propels the cycle of poverty for Brazil’s poor. Race, class, education, land and government are all sources of power that dictate where wealth remains in Brazil.
Hope remains for Brazil’s poor despite its past. Poverty has been nearly wiped out for the elderly due to well-funded pensions. What is more, state funded programs such as Bolsa Familia have lifted tens of millions out of poverty and now, more than half of Brazil’s population is considered middle class.
Expanding opportunities for education, access to land and less corruption in government will pave the way for a more equitable Brazilian society.
– Jeanine Thomas
Photo: Flickr
FAQs
So, why is Brazil poor? A history of inequality that runs deep in the country propels the cycle of poverty for Brazil's poor. Race, class, education, land and government are all sources of power that dictate where wealth remains in Brazil. Hope remains for Brazil's poor despite its past.
Why did Brazil become so poor? ›
Brazil is underdeveloped because its economy failed to grow or grew too slowly for most of its history. In the colonial era, sugar, gold and slavery did not create a dynamic economy.
What is the problem with poverty in Brazil? ›
Over 50 million Brazilians live in inadequate housing. In addition to urban slums, rural areas of Brazil also experience significant poverty and lack of quality housing. This means many Brazilians rural dwellers do not have access to sanitation systems like flushing toilets and running water.
When was Brazil poor? ›
Through the 1980s and 1990s, the Brazilian economy suffered from rampant inflation that subdued economic growth. After several failed economic initiatives created by the government, in 1994 the Plano Real was introduced.
Why is Brazil poorer than USA? ›
The population also pays a price because of tropical diseases that take a large toll on labor and health. Brazil is a large plateau that runs all the way up to the coast. This means their coastal cities have no hinterlands to generate food or capital.
How poor is Brazil as a country? ›
Poverty in 2020 was below 2019 levels (18.7 percent and 26.2 percent under the international poverty line of $6.85 a day in 2017 PPP, respectively) largely due to the Auxilio Emergencial program that benefited over 67 million people.
What is the poor part of Brazil? ›
The people who live in favelas are known as favelados ("inhabitants of favela"). Favelas are associated with poverty. Brazil's favelas are the result of the unequal distribution of wealth in the country.
Is Brazil a rich or Poor country? ›
The economy is a middle income developing mixed economy. In 2022, according to International Monetary Fund (IMF), Brazil has the 10th largest gross domestic product (GDP) in the world and has the 8th largest purchasing power parity in the world. $2.081 trillion (nominal; 2023 est.) $4.020 trillion (PPP; 2023 est.)
Does Brazil have low income? ›
Between 2014 and 2016, over 5.6 million Brazilians fell into poverty (defined as living on less than $5.50 per day in 2011 PPP terms) as poverty increased from 17.7 percent to 20.1 percent. The number living on less than $1.90 per day 2011 PPP increased by over 2.5 million to surpass 8 million.
Is Brazil or Mexico poorer? ›
In 2022, Brazil and Mexico were the countries with the largest gross domestic product (GDP) in Latin America and the Caribbean. In that year, Brazil's GDP reached an estimated value of 1.9 trillion U.S. dollars, whereas Mexico's amounted to almost 1.4 trillion U.S. dollars.
Brazil's wealth is its commodities. For it to grow past that, it needs other assets. But it's going to be incredibly hard for it to beat other countries with industry, because its costs are so much higher than elsewhere. And given its historic protectionism, its local industries are not very competitive.
Is Brazil more poor than Mexico? ›
Mexico is the second largest economy in Latin America, after Brazil; and the second Latin American country with most number of poor, after Brazil as well; given Mexico's population is about 80 million less than Brazil.
How did Brazil become wealthy? ›
Brazil is one of the world giants of mining, agriculture, and manufacturing, and it has a strong and rapidly growing service sector.
Why did Brazil's GDP collapse? ›
The reason for Brazil's decline in GDP per capita in the mid-2010s was due to the 2014 Brazilian economic crisis, fueled by both political crisis and the 2014 commodity price shock. You can see the effects of this economic crisis in the change in the value of Brazil's exports during those years.
Why has poverty decreased in Brazil? ›
Education is the key to the intergenerational breakdown of poverty. Brazil has achieved universal primary education since the end of the 1990s with 98% of children between 7 and 14 years of age at school. Since then, all educational indicators have been improved, but, unfortunately, slower than the need.
Is Brazil one of the poorest countries? ›
The economy is a middle income developing mixed economy. In 2022, according to International Monetary Fund (IMF), Brazil has the 10th largest gross domestic product (GDP) in the world and has the 8th largest purchasing power parity in the world. $2.081 trillion (nominal; 2023 est.) $4.020 trillion (PPP; 2023 est.)
