1. Is there a Brazilian model
of development?
www.Brazil4Africa.org
#brazil4africa

2. Why is Brazil of interest to African countries?

3. Why is Brazil of interest to African countries?
• Brazil and Africa have a
longstanding relationship,
born out of the slave trade.
• The relationship was
enthusiastically reinvigorated
by President Lula in the
2000s.
• In addition to expanding
diplomatic and economic
links, Brazil has become more
involved in development,
through providing South-
South cooperation.
• These are often based
on innovative policies
and institutions that
have worked in Brazil.

4. What is the International Research Initiative
on Brazil & Africa (IRIBA)?
A three year, £2.2m, DFID funded research programme
Addresses two main research questions:
Phase 1: September 2013 – December 2014
Is there a new Brazilian development model?
Phase 2: January 2015 – December 2016
What lessons might Brazil’s success have for the economies of sub-Saharan
Africa? How could they be adapted?
www.Brazil4Africa.org

5. Research Conducted in Phase 1:
1) The economics of the Brazilian model of agricultural development
2) What explains the intensification and diversification of Brazil’s agricultural production
and exports from 1990 to 2012?
3) Technological catch-up and indigenous institutional infrastructures: The role of
EMBRAPA
4) Antipoverty transfers and inclusive growth in Brazil
5) The Impact of SENAI's vocational training program on employment, wages, and
mobility in Brazil
6) Restructuring Brazil’s national financial system
7) Institutions for macro stability: Inflation targets and fiscal responsibility
8) Brazilian anti-corruption legislation and its enforcement: Potential lessons for
institutional design
9) Infrastructure and its role in Brazil’s development process
10) Tax, redistribution and the social contract in Brazil
11) Explaining the decline in earnings inequality from 1995-2012
12) Synthesis paper: Is there a new Brazilian Development Model?
All available, with accompanying briefings at: www.Brazil4Africa.org/publications

6. Finding 1:
The Brazilian ‘model’ is a blend of consensus and
conjuncture
• Brazil’s transition to democracy and the 1988 constitution forged a
strong social contract.
• This was necessary to push through and sustain difficult and potentially
socially disruptive reform programmes such the Real Plan.
• A desire to address the ‘social debt’ created during military rule was
also key. The resulting social policies have reinforced political support.
• The model wasn’t the result of an overarching strategy or plan, but a
mutually reinforcing set of policies and institutions, implemented with
a medium-term focus and remarkable continuity by different coalition
administrations.

7. Finding 1:
The Brazilian ‘model’ is a blend of consensus
and conjuncture
Social contract /
consensus
Intuitions of economic management
Innovative social policies

8. Finding 2:
Brazil’s development ‘model’ is based on inclusive
growth
Brazil Growth Incidence curve 2001-2012
( Ref. period = initial | Order : s=1 | Dif. = ( Q_2(p) - Q_1(p) ) / Q_1(p) )
I
RIBA yellow tint (background): Red=2248, Green=244, Blue=219 (#f8f4db)
.2 .4 .6 .8
0
0 .19 .38 .57 .76 .95
Percentiles (p)
Confidence interval (95 %) Estimated difference

9. Finding 3:
Macro stability has underpinned progress
The Real Plan - implemented in the mid 1990’s - ended hyperinflation.
There’s been a sustainable expansion of credit to households & businesses.
The national development
bank (BDNS) has played an
active role – particularly
Following the Global Financial
Crisis

10. Finding 4:
Fiscal capacity and responsibility has been vital
Institutional responsibility
was established in the
battle against hyperinflation.
Brazil has benefited from tax
reform and capacity built
from the 1960s.

11. Finding 5:
Agriculture has been transformed
Since 2000, Brazilian agricultural
production and exports have
increased enormously.
The production of crops rose by
over 150%, while exports multiplied
eightfold from 1990 to 2012
Not the result of an overarching plan
– but the product of various
institutions mutually reinforcing
each other.

12. Finding 6:
Brazil shows the ‘resource curse’ is not inevitable
High-valued wood products
Phytotherapics and
phytocosmetics components
Biotechnology
Leading firms re-organize and re-focus their
research activities to face the new economic
and institutional conditions of the 1990s
Electricity and steam
VCP-J
Suzano
Klabin
Leading firms strengthen their internal R&D
after the end of the IPEF/ESALQ external
Aracruz’s breakthrough innovation in
forestry with worldwide recognition
(Marcus Wallenberg Prize)
Suzano completes a six-year
research project
and becomes world’s
first paper maker from
eucalyptus pulp
Leading firms draw on their forestry
innovative capabilities to explore new
technological and market opportunities
Leading firms re-organize their forestry research
activities after the Genolypus project
Leading firms engage in the Genolyptus project
Aracruz structures its forestry R&D centre to tackle
eucalyptus diseases
1950s-1960s 1970s-1980s 1990s 2000s
Brazil is the 4th largest producer of forestry-based pulp and the 9th largest producer of paper

13. Finding 7:
Social policy has focused on inclusion & productivism
Innovative antipoverty
transfers have:
1) Explicitly targeting
human development, rather
than simply acting as a
more traditional safety net
for the sick and old.
2) A productivist element,
concerned with economic
inclusion.
3) A focus on citizenship-and
rules-based transfers,
avoiding clientelism.

14. Finding 8:
Rising tax revenues have been redistributed
The tax system
prioritises revenue
raising over efficiency -
which has funded the
expansion of
antipoverty transfers
and other social policies.
1990
2002 2001
1999 1998
1980
1995
1985
1997
1996
2000
2003
2005
2004
2007 2006
2009
2008
17
16
15
14
13
12
11
10
9
8
7
0.53 0.54 0.55 0.56 0.57 0.58 0.59 0.6 0.61 0.62
Federal Social Spending (% GDP)
Gini Coefficient

15. Finding 9:
Human capital accumulation improved average wages,
while labour market intuitions reduced earnings
inequality
Brazil has invested significantly in formal education – but also ensures that effective vocational
training is provided, particularly through SENAI.
Rises to the minimum wage have helped to
reduce inequality since 2005.
The biggest factors behind the decline of earnings
inequality were reduced gender, racial and
geographical differentials.

16. Finding 10:
There are limitations to the ‘model’
Slowdown in growth since the Global Financial Crisis.
Lack of investment in infrastructure & instability in regulation is stifling
development.
Institutional bottlenecks prevent the
effective prosecution of corruption.
Increasing strain on the social contract.

17. Implications for African counties?
Brazil is a product of unique set of social, political and economic circumstances – so
a ‘cookie cutter’ approach to adapting lessons won’t work.
A strong social contract and inclusive growth has underpinning development.
How to manage the natural resource dividend?
South-South cooperation on particular issues may be useful.
The next phase of the IRIBA project will grapple with these question in much more
detail - working alongside African researchers.
www.Brazil4Africa.org