Another Brazil Essay Research Paper Brazil National — страница 5

Securities Commission(CVM) The process of registration can be very time-consuming. Banking and financing business are regulated by the Central Bank. Major banks in the private sector have been organized into financial conglomerates, and are able to offer full range of financial services through subsidiary and associated companies. A point to note is that Brazil is not an international financial center and offshore banking, trust, and financial services are not allowed. Imports have been generally subject to high tariffs but are starting to fall. The maximum import duty rate would be reduced to 40% by the end of 1994, and the modal rate was projected at 20%. Import procedures were also deregulated. Besides the 26% corporate tax, a 15% tax is also charged on dividends. Although a

corporation can be wholly foreign-owned, participation of local capital is favored by authorities. The director of the corporation must hold a permanent visa and be domiciled in Brazil, though nationality is not a restriction. The labor force is approximately 62 million, or 41% of the population. Women comprise 35% of the total, and this percentage is projected to increase. All employers, with few exceptions are required to employ Brazilians in the proportion of at least two-thirds of their total personnel as regards both number and total remuneration. There is a minimum wage requirement and labor unions have become more active especially after the national two day strike in 1989. Patent and trademark laws are available on a federal level. Environmental awareness has increased

due to international pressure, especially from the US. This has restricted the exploitation of the tropical rain forest. The infrastructure is underdeveloped. There has been no major modernization or improvement of the government-controlled railroad system, though there are plans for some extensions. Hence road transport dominates, but highways are not well maintained and construction of new highways has been slow in recent years. The airline network is well developed and mainly privately owned. Urban transportation poses significant problems especially in major cities. The postal system is well developed. The telecommunication system has made significant progress, but is now lack of further investment. Telexes and electronic mail links are widely used by business and industry.

Canadian Firms in Brazil For Canadian businesses, Brazil offers great opportunities for its vast consumer base, close proximity, and its similarities in language and culture. With the current government’s commitment on economic liberalization, the investment climate is favorable. Interested firms should be prepared to commit a medium to long term investment subject to tight exchange control. Government policy may be unstable. Precautions should be taken when dealing with local government due to the cumbersome and corrupt bureaucracy. Connections with the political scene is advisable. Also, Brazil has much more primitive financial and industrial base, and a much lower standard of labor productivity. Employee training would be a substantial part of investment. Canadian industries

can take advantage of the large labor base for labor intensive manufacturing processes like textile and electronics. There is also large potential in the agriculture, fisheries, and energy sectors. The huge population, combined with those of the MERCOSUL countries will form a gigantic consumer base for almost any product. As inflation and foreign debt under control, Brazil might fulfill the promises it gave in the 1970s as an economic miracle among developing countries. Bibliography "Another Devaluation, Few Tremors." Business Week, (1995), 28. Arraes, Miguel. Brazil: The People and the Power. Middlesex: Penguin Books Ltd., 1972. Doing Business in Brazil. 6th ed. USA: Price Waterhouse, 1994. "Happy Birthday," The Economist, v.336 (1995), 36. Mccluskey, Ian.

"Magic Rio-ism." Time, 146, no. 24 (1995), 16. ________. "Staking Claims." Time, 146, no. 25 (1995), 33. Roniger, Luis. Hierarchy and Trust in Modern Mexico and Brazil. New York: Praeger, 1990. "Survey: Brazil," The Economist, v.335 (1995). "Tax Reform and the Governors," The Economist, v.336 (1995), 39-40. Teixeira, A. S. "The Changing Role of Education in Brazilian Society." In Modern Brazil, 71-95. John Saunders ed. Florida: University of Florida Press, 1971. "The Fiscal Black Hole of Sao Paulo, and others," The Economist, v.338 (1996), 41-42. Trade Policy Review: Brazil. Geneva: GATT, 1993. "Urban Crime: from Rio…," The Economist, v.337 (1995), 37. "Watch my hands," The Economist, v.337 (1995),