Emergin Markets_Brazils Quest for Comparative Advantage Essay

1118 Words Jan 24th, 2015 5 Pages
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Case Study 1: Emerging Markets: Brazil’s Quest for Comparative Advantage

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STUDENT ID
JANUARY 2015
Table of Contents: Page Number
Abstract 3
What Makes Brazil’s Economy Competitive 4
Brazil’s Eager to Develop World-Class Manufacturing 5
Shifting Brazil’s Economy 5
On Ethics 6
Conclusion 6
References 7

Abstract
When it comes to Global Business, Strategic/International Trade, among other forms of doing business domestic and internationally, it is crucial to follow on of the most important principles in all economics; comparative advantage. This theory was developed by
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This led Brazilians to realize that the country’s comparative advantage lies in agriculture (Peng, 2014).
However, Brazilian government policies have played an enormous role in the Brazilian economy. The main factor affecting the competitiveness of Brazilian exports is the high cost in manufacturing including labor costs. Skilled labor is in short supply and is one of the most significant growth barriers for Brazil’s labor-intensive manufacturing industry. Industrial surveys undertaken by the most prestigious research institutions in Brazil over the last few years ranked the lack of qualified labor as one of the most critical barriers to manufacturing growth, along with the high tax burden. With the current tax reductions benefiting a broad range of manufacturing industries, the National Confederation of Industry’s latest surveys have shown a decline in the percent of respondents listing the tax burden as one of the major problems facing factories (Sedano, 2013).

Brazil’s eager to develop world-class manufacturing Brazil is today a rising competitor with a strong position in the global scenario, and working to achieve its competitive potential through making feasible changes in its industries. “Brazil has also pursued an industrialization policy centered on replacing imported manufactured products with

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