Brazilian industry
Brazil has well-developed industries in sectors of agricultural, mining, manufacturing and services.
Brazil is the world's biggest producer of sugar cane and coffee, and a main exporter of soybeans, cocoa, orange juice and tobacco. Brazil is also one of the leading hydroelectric power producers of the world. Brazil's diverse manufacturing range from automobiles, steel and petrochemicals to computers, aircraft, and consumer durables. In the latest years the information and technology sector has gained major position in the Brazilian industry and accounts for around 30% of the country's total GDP.
Location
Due to historical reasons the Brazilian industry is mainly centralized in the southern part of this huge country.
The state of São Paulo has a strong focus on financial, manufacturing and agribusiness ventures, for example. Rio de Janeiro is the hub of the ongoing Oil, Gas and Energy boom taking place in the country, the main location for Shipbuilding and has strong service-oriented business opportunities as well. Although some of these industries are located in both states, there is a growing presence of these same industries, and new ones developed, throughout the country as a whole. Few examples of Brazilian states that developed specialties in certain industries:
- Minas Gerais - Metal mining and Steel industry
- Rio Grande do Sul - Poultry farming
- Santa Catarina - Coal
- Ceara - Textile
Policy of Decentralization
For many years Brazilian governments have been doing intentional activities to decentralize the industry activity to other parts of the country.
Brasilia
The most famous acts of this decentralization policy, was moving the capital of the Brazilian republic from Rio de Janeiro to the rural area of Goias. The building of the city of Brasilia attracted a massive development to an area that previously was uninhabited, deserted and isolated. Nowadays Brasilia and the the Federal state is the third largest commercial center of Brazil.
Free Trade Zones
Free trade zones were created in order to promote the development of sparsely populated and remote areas, by creating special TAX regimes for import and export activities.
The first Free Trade Zone was declared in Manaus at the state of Amazonas on 28th of February 1967. The initial idea of the Manaus Free Trade Zone came from Deputy Francisco Pereira da Silva in 1951. For many years the project had very little national credibility and was realised actually with a single rented warehouse in the Port of Manaus. In 1967, President Castello Branco signed a law redefining the Manaus Free Trade Zone in more concrete terms. Following is the translation of the redefinition:
The Manaus Free Trade Zone is an area in which goods may be freely imported and exported and special fiscal incentives are offered for the purpose of promoting regional development, through the establishment of a thriving industrial, commercial, and agricultural center with the economic and financial conditions to foster local development in response to the area’s particular local factors and considerable distance from the major consumer markets
Decree-Law No. 288 of February 28, 1967
Nowadays, Manaus Free Trade Zone is an area with a radius of 10,000 km comprised of industrial and agricultural centers. The Manaus Free Trade Zone is directly responsible for approximately 100 000 jobs in western Amazonia, and additional estimated 400 000 indirectly related jobs outside the Free Trade Zone.
Following the success of this initiative, additional Free Trade Zones where declared in the northern part of Brazil:
- Brasiléia and Cruzeiro do Sul in the state of Acre
- Bonfim and Boa Vista in the state of Roraima
- Guajará-Mirim in the state of Rondônia
- Tabatinga in the state of Amazonas
- Macapá and Santana in the state of Amapá
Along the years since the Free Trade Zones have been declared , more than 600 companies, including many of the world's largest enterprises, have established production in these states which by all means have some of the most disagreeable commercial locations in Brazil. Between the businesses established in the area, are companies like Nokia, Honda, Pepsi, Coca Cola, Panasonic, Harley-Davidson and many more.
Airports
Brazil’s land area is 8.514.876.599 km2 which obviously makes the distances between the various centers enormous, and even after many years of massive investments, in roads and transportation infrastructure, the country still suffers from poor land connectivity. To overcome this obstacle the brazilian government is in a process of building not less than 800 new industrial airports around the country, to make distance areas accessible.
Brazilian Silicon Valley
In the last decades, due to the increasing costs of living in the main cities, and due to the high demand for professional, high educated human resources, many companies have searched for alternatives to locate their R&D centers. This search had led to the creation of several new high-tech industrial areas, called “Technology Parks” mostly located near technology universities around the
The biggest Technology Park is located at the city of Campinas. A modern city, located just outside of the giant metropolis, São Paulo. It has a vibrant, high-tech university and research environment, Campinas boasts a researcher/population ratio equal to those of the most advanced technology centers in the world.
Other cities have created technology parks, and are all aiming to become the next Brazilian Silicon Valley:
- Araraquara and São Carlos, both at the State of São Paulo, with high technology industries and Universities
- Recife at the state of Pernambuco, with a budding Digital Port and many collaborative ties with the UFP (Universidade Federal de Pernambuco)
- The Vale do Sapucaí and Belo Horizonte both located at the state of Minas Gerais, not properly a Silicon Valley because it has mostly a software industry, but the upcoming BHTec along with possible semiconductor industry developments in its metropolitan area could change this situation.
- Florianópolis at the state of Santa Catarina, also has mostly software industry.
- Rio de Janeiro, Porto Alegre, Curitiba, Blumenau and Londrina, all in the Southeast and South.
Summary
The increased investments in infrastructure and tax incentives in different states, along with the increasing and spreading of the population with more money to spend and consume new products and services around the country, created new opportunities and new locations for foreign companies to invest in, or for them to establish their headquarters in the country. or in other words São Paulo and Rio de Janeiro are not the only Business cities in Brazil.