The case study examines Brazil's economic challenges stemming from colonialism, which began in 1500 with Portuguese colonization and led to dependency on raw material exports. After gaining independence in 1822, Brazil faced neo-colonial ties to Portugal until the 1950s, when import substitution industrialization policies were implemented to foster local manufacturing. Subsequent economic events, such as the 1970s oil crisis and the formation of Mercosur in 1991, led to increased trade partnerships and diversification of Brazil's economy.

1. Case Study - Brazil:
The impact of colonialism on a
developing economy

2. Case Study:
We will study how Brazil, a country in
the developing world, has:
(a)been impacted by colonialism.
(b)adjusted to the global economy since
independence.

3. Colonialism in Brazil
• In 1500, Portuguese explorer Pedro Alvaras
Cabral was the first person to discover
Brazil. Brazil then became colonised by
Portuguese settlers.
• Slavery fueled the Brazilian economy and
was essential in their sugar cane production
and mining.
• Brazil remained a colony of Portugal until
1822 when Brazil declared it’s
independence from Portugal.

4. Colonialism delayed
economic development
During colonialism all profits from the
export of Brazil’s natural resources went to
Portugal. Brazil was unable to develop its
own industries while it was colonised so the
economic development of Brazil was
hindered.

5. Colonialism affected exports
• During colonialism Brazil’s main exports were
timber, sugar cane and coffee beans.
• After independence, Brazil remained dependent
on the export of unprocessed raw materials for
its wealth which meant that its manufacturing and
service industries were underdeveloped.

6. Colonialism affected
trading partners
• Colonialism badly affected the pattern of
trade in Brazil. While it was a Portuguese
colony most of its exports went to just
three main markets: Portugal, other
European countries and the U.S. This
prevented economic growth in Brazil.

7. After Colonialism
• For over 100 years after independence, Brazil
remained economically tied to Portugal, its former
colonial power. This is called neo-colonialism.
• By the 1950s Brazil began to trade with the rest
of the world. This was possible because of
decisions made by the Brazilian government.

8. Brazilian Government decide to change
exportsand increase manufacturing
• In the 1950s the Brazilian Government began its Import
Substitution Industrialisation (ISI) policy.
• Under this policy, Brazilian industries were set up to
manufacture the goods Brazil used to import.
• MNCs such as Shell and Ford Motors were offered tax
incentives and grants to locate their production plants in
Brazil.
• Under its policy of protectionism, tariffs and bans were
placed on imported goods so that Brazilian industries
could grow rapidly.

9. Brazilian Government decide
to change trading partners
Since the 1970s three events greatly
increased the number of countries
with which Brazil trades:
• The oil crisis
• The debt crisis
• The formation of Mercosur

10. The Oil Crisis of the 1970s

11. The Oil Crisis of the 1970s
• Between October 1973 and January 1974 world oil
prices quadrupled. When oil prices rose Brazil could
not afford to pay for the oil it needed so a new drive
to increase trade with Argentina and other South
American countries began in order to increase
exports.
• The Brazilian government also developed a biofuels
programme which used sugar cane to make ethanol
which could be used as a fuel instead of petrol.

13. The Debt Crisis in the 1980s
• In the mid-1980s the new Brazilian president
managed to bring the economy and debt under
control using a series of Structural Adjustment
Programmes (SAPs).
• SAPs are policies that a country must follow in
order to qualify for World Bank and IMF
(International Monetary Fund) loans.
• The SAPs encouraged greater exports of cash
crops, such as soya.

14. The Formation of Mercosur
• In 1991 the Mercosur (the Southern Common
Market) was created. This allowed the free trade
of goods and services between Brazil, Argentina,
Paraguay and Uruguay. Later, Chile and Bolivia
became associate members of Mercosur.